Sitting of 15 January 1987

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

  BRITISH RAILWAYS (STANSTED) BILL (By Order.)
  Order for Third Reading read.
  To be read the Third time upon Thursday 22 January

  YORK CITY COUNCIL BILL [Lords] (By Order)
  Order for Second Reading read.
  To be read a Second time upon Thursday 22 January

Oral Answers to Questions
  NORTHERN IRELAND

    Anglo-Irish Agreement
    Mr. Stephen Rossasked the Secretary of State for Northern Ireland if he will report on his assessment of the results of the implementation of the Anglo-Irish Agreement.
    Mr. Nicholas Bakerasked the Secretary of State for Northern Ireland if he will make a statement on the progress of the Anglo-Irish Agreement.
    The Secretary of State for Northern Ireland (Mr. Tom King): Steady progress is being made, not least in the area of security co-operation. Experience has clearly demonstrated how views reflecting the interests of the minority can he taken into account without threatening the position of the majority or undermining United Kingdom sovereignty.
    Mr. Ross: As one who is strongly in favour of the agreement, which is constantly being misrepresented by Unionist politicians in the Province, may I urge the Secretary of State to take the initiative himself and, with the aid of television, spell out to the citizens of the whole of the United Kingdom the exact terms of the agreement and how they could be developed if only the politicians in Northern Ireland would sit down and work together for the common good?
    Mr. King: I am grateful to the hon. Gentleman for his consistent support for the agreement and I take serious note of his point. There is no doubt that the best hope for the defeat of terrorism, which is so important to everybody in Northern Ireland, must be in closer and more effective co-operation with the Republic of Ireland. Everybody in Northern Ireland knows that, and this agreement offers us the best prospect of that being achieved.
    Mr. Nicholas Baker: Is my right hon. Friend aware that many of us who support the general Unionist position
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    believe that this agreement is the only practical instrument for greater co-operation between Northern Ireland and the Republic, and that it can bring as great benefits to the Unionists in Northern Ireland as can greater co-operation between the communities there? Will my right hon. Friend urge the Unionist parties to come back to this Chamber to discuss democratically the way in which the agreement is working for their benefit?
    Mr. King: I hope that they will recognise the need to return to this Chamber and make a constructive contribution here. If they do not, their arguments will not be listened to with any great respect. In looking at the progress of the agreement, I note that it offers the opportunity for the minority tradition to be respected and for minority views to be taken into account. It is greatly in the interests of the majority in Northern Ireland that the minority should feel that their views are fairly respected as well.
    Mr. J. Enoch Powell: When does the Secretary of State now expect that the European convention on terrorism will be ratified by the Irish Republic? That was held out as one of the prizes of the Anglo-Irish Agreement 14 months ago. Will he take a £100 bet with me on this?
    Mr. King: I shall not take up the offer in the second part of the right hon. Gentleman's question. I do not intend to speculate on exchange rates. I have enough problems with other matters in Ireland without taking on that issue as well. I understand that, as the right hon. Gentleman will know, the convention has been signed by the Minister of Justice in the Republic of Ireland. It has passed through the lower House and we hope that it will make the further progress necessary for ratification. The right hon. Gentleman will also have noted the encouraging news about a more effective response to the issue of extradition. Indeed, an item of news this morning tends once again to reflect the improved relationship and the improved attitude that flows from the agreement.
    Mr. Gow: Does my right hon. Friend accept that it is possible to acknowledge and respect the Nationalist tradition and the Nationalist position in Northern Ireland without being a supporter of the Anglo-Irish Agreement? Does he not understand that to give the Irish Republic responsibility for representing Nationalists in discussions with Her Majesty's Government is intensely divisive and, in some ways, insulting to the Nationalists in Northern Ireland?
    Mr. King: I respect my hon. Friend's views, and I agree that it is perfectly possible to respect the Nationalist tradition without being a subscriber to the Anglo-Irish Agreement. However, an awful lot of people in Northern Ireland have not been very good at doing that in recent years. The agreement enshrines the point that if there is to be greater harmony in Northern Ireland, it is important to recognise that within the Province there are people who hold a different point of view from that of the Unionist majority. It is in the interests of the Unionist majority that that should be recognised more publicly. If I understood correctly my hon. Friend's question, I hope that he will seek to urge the Unionist majority to recognise the proper rights and the respect that is due to the Nationalist minority.
    Mr. Archer: I revert to the Secretary of State's answer to the hon. Member for Isle of Wight (Mr. Ross). Does he

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    agree that the Anglo-Irish Agreement is an abstract concept which exists, and can only exist, in the minds of human beings? Does it not follow that its importance lies wholly in what it leads human beings to do? Will the Secretary of State consider publishing a list of the things that it has led him and his Department to do which otherwise they probably would not have done, so that we may all make a rational judgment about it?
    Mr. King: I shall certainly look at ways in which we might more effectively list the achievements and the effects of the Anglo-Irish Agreement. As for the progress of the Anglo-Irish Agreement, I note that there are many people in Northern Ireland, certainly in the majority community, who believe that security is overwhelmingly the most important aspect of the agreement. I could list improved performance on the seizure of arms, the apprehension of mortars, the recovery of explosives and more effective extradition procedures. I rest mainly on the judgment of the Chief Constable of the RUC. He says that the agreement provides him and his force with the best opportunity that they have had to improve security and co-operation. I pay attention also to the entirely opposite point of view. It is quite clear that the IRA regards the agreement as a serious threat to its operations.

    Northern Ireland Assembly
    Mr. John Mark Taylorasked the Secretary of State for Northern Ireland what representations he has received concerning the revival of the Northern Ireland Assembly.
    The Minister of State, Northern Ireland Office (Mr. Nicholas Scott): The Government have offered a round table conference on devolution and in advance of this are ready to facilitate informal talks among the parties. There is a wide measure of support for a return of greater responsibility to Belfast from Westminster and we have received a number of representations to that effect.
    Mr. Taylor: I thank my hon. Friend for his reply. Bearing in mind that Northern Ireland has no system of local government to compare with that in Britain, does he agree that it is unfortunate that there should not be a domestic forum in which Northern Ireland political activity could be induced in preference to the politics of the street and the politics of the courtroom?
    Mr. Scott: I agree wholeheartedly with my hon, Friend. As he knows, we established the Assembly and encouraged and co-operated with it. We should like conditions to be created in which it could again play a constructive role in the affairs of Northern Ireland. It was only when the Assembly refused to undertake any of the work that had been laid on it by Parliament that we decided to dissolve it.
    Mr. Bell: Will the Minister confirm that there is no question of returning to the status quo ante that existed prior to the signing of the Anglo-Irish Agreement and that there will be no return to the Protestant ascendancy in Northern Ireland? Does he agree that the Anglo-Irish Agreement provides sufficient scope for devolution for all the people of Northern Ireland? Is it not a fact that those who have ears should hear?
    Mr. Scott: I assert once again that the Government believe that devolution remains the right objective for us to pursue, and as far as possible we shall pursue that
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    objective. As for the hon. Gentleman's first remark, it is absolutely clear that the only basis on which such arrangements could be introduced would be on what was acceptable to the representatives of constitutional politics who reflect both traditions in Northern Ireland.
    Mr. Budgen: Will my hon. Friend make it plain that it is not necessary to resurrect the Assembly in order to reintroduce a greater measure of local government in Northern Ireland?
    Mr. Scott: That is certainly true, but perhaps my hon. Friend will remember what I have just said about the need for widespread acceptance of any changes in arrangements for Northern Ireland. The Government believe that devolution rather than increasing the powers of local government is more likely to achieve that.
    Mr. Hume: In view of the call of the Secretary of State earlier this week for talks between the parties in Northern Ireland without preconditions about devolution, may I tell the Secretary of State that my party is ready to participate in such talks?
    Mr. Scott: I am sure that my right hon. Friend will welcome that assurance as warmly as I do.
    Mr. Cash: Will my hon. Friend agree that until those on the Unionist side of this problem appreciate that it is absolutely essential for them to participate locally, whether it is in an Assembly or in any other chamber, including this Chamber, it really will be impracticable to have revivals of Assemblies such as the Northern Ireland Assembly? We would all like to see it happen. The question is, will they let it happen?
    Mr. Scott: The Government clearly understand the feelings of the Unionist community and their political representatives about the Anglo-Irish Agreement, but I believe that it is folly for them to boycott this House and contacts with British Ministers on all of this. The sooner they get back to proper relationships in these matters, the better.

    Street Marches and Demonstrations
    Mr. Mallonasked the Secretary of State for Northern Ireland what assessment he has made of the amount of police time devoted to policing street marches and demonstrations over the past 12 months.
    Mr. Scott: Last year, between May and September, when the majority of such events occurred, it is estimated that a total of 334,000 man-hours were devoted to policing street marches and demonstrations.
    Mr. Mallon: Will the Minister confirm that the Social Democratic and Labour party is the only party in the north of Ireland which recognises that there is a policing problem and that, because of this, it is the only party which has not caused problems for the police or put them in danger in the way that was outlined in the Minister's reply?
    Mr. Scott: I very much hope that the party which the hon. Gentleman represents will be able to continue to develop its expressions of support for the Royal Ulster Constabulary in Northern Ireland and continue to support all those who believe that parades and marches should be conducted in a way which facilitates the efforts of the police to maintain law and order on these occasions.
    Sir Eldon Griffiths: Does my hon. Friend agree that in grappling with these problems the RUC's men and women have conducted themselves in a wholly non-partisan, non-sectarian fashion; in short, that there is no such thing in Northern Ireland as Catholic policemen or Protestant policemen, but just policemen under the law? So is it not sad that there are those in high places, political or ecclesiastical, who refuse to encourage young men and women to join that non-political police force in the national interest?
    Mr. Scott: I find it difficult to overstate my respect for the skill and professionalism of the RUC and the way in which it has handled these parades, marches and other public order situations in recent months. I would certainly encourage everyone in Northern Ireland who wants a peaceful society to give his wholehearted and unequivocal support to the RUC.
    Mr. Spencer: Will my hon. Friend accept that those of us from constituencies from which are recruited the regiments which presently serve in Northern Ireland are dismayed at those pleas from politicians in Northern Ireland for people to assemble in large numbers, thereby increasing the risk to our troops serving there?
    Mr. Scott: I agree wholeheartedly with that. I can only reiterate that whether it is the security forces, the Army or the police who are involved, they deserve the support and co-operation of all those who hope for a peaceful future in Northern Ireland.

    Sampson Report
    Mr. Tony Lloydasked the Secretary of State for Northern Ireland what representations he has received concerning the Sampson report.
    Mr. Tom King: I have received a number of inquiries about the progress of Mr. Sampson's inquiry and the contents of his reports. As the House is aware, the first part of Mr. Sampson's report is now with the Director of Public Prosecutions for Northern Ireland. The second part is expected to be completed by Mr. Sampson shortly. As I informed the House, I shall wish to make a statement as soon as possible on any aspects of the report that fall within my responsibility.
    Mr. Lloyd: Is the Secretary of State aware, however, that there is a degree of impatience at the fact that this report is always promised as coming shortly? When does he expect to make the statement that he promised over three months ago? During Mr. Sampson's inquiries, did he get round to interviewing the Chief Constable of the Royal Ulster Constabulary and his deputy, as was the intention of the deputy chief constable of Greater Manchester when he was involved?
    Mr. King: With regard to the seond half of the question, my understanding is, yes, Sir. In regard to the first part, I clearly gave the information available to me in my answer. That is a matter for Mr. Sampson, who, I know, has been anxious to make the most thorough but speedy completion of his inquiries. I fully share the impatience that the hon. Member feels. It is obviously very important for the RUC and its good name that these matters are resolved at the earliest possible moment.
    Mr. Merlyn Rees: The Secretary of State said that he would make a statement eventually on those parts of the report which fell within his responsibility. Will he explain to the House what those responsibilities are?
    Mr. King: As I made clear in an earlier reply, aspects of the report which involve allegations of criminal offences, on which criminal charges may be brought, will have to follow the normal procedure. In so far as they affect organisation, management structure and wider policing issues, there may be aspects which fall clearly within my responsibility.
    Mr. Meadowcroft: I appreciate the sensitivity of the matter for the Secretary of State. Does he intend to publish the report as far as possible? Will he contemplate publishing as much of it as possible on the lines of other reports relating to Northern Ireland which have been published in the past?
    Mr. King: The hon. Gentleman must understand that the report was commissioned by the Chief Constable of the RUC. He has forwarded the first part to the Director of Public Prosecutions for Northern Ireland. Clearly, the Director of Public Prosecutions, and conceivably my right hon. and learned Friend the Attorney-General, will be concerned with aspects of it. Police reports of this kind would not normally be published, but I hear what the hon. Member says. Obviously, I am anxious that everything possible should be done to clear the matter up fully and to deal with it effectively, but I am in some difficulties in replying fully because I have not myself seen the contents of the report.
    Mr. Archer: In view of the disclosure earlier this week by Mr. Stalker that he would have remained in the police force had he been permitted to continue the inquiry into the RUC, is it not vital in the interests of everyone that, irrespective of the Sampson report, the public should be told quickly what inquiries Mr. Stalker was making and what conclusions he had reached, otherwise is speculation not inevitable that he was investigating something important and that some people in high positions wanted to prevent his investigation?
    Mr. King: The right hon. and learned Gentleman's question illustrates all too clearly the importance of getting as much as possible established in the public domain at the earliest opportunity and of resolving the matters as early as possible, otherwise such rumour and speculation will spread. The House should remember that the question whether Mr. Stalker was or was not available for the inquiry was not a matter for me but for the chief constable of Manchester, who advised the Chief Constable of the RUC that Mr. Stalker was no longer available, so alternative arrangements had to be made. Having said that, I certainly recognise that while Mr. Stalker was not able to continue, the whole of his team which was working on it did continue its work, albeit under the direction of Mr. Sampson.

    Intergovernmental Security Divisions
    Mr. Dubsasked the Secretary of State for Northern Ireland if he will make a statement on meetings he has had with Ministers in the Government of the Republic of Ireland on co-operation on security matters.
    Mr. Scott: A special meeting of the intergovernmental conference was held on 31 October last year to discuss cross-border security co-operation. In addition, my right hon. Friend the Secretary of State and I frequently discuss this subject with members of the Irish Government at regular meetings of the intergovernmental conference. My right hon. Friend also met the Taoiseach on 28 November. It would not be appropriate to disclose details of those discussions, but both Governments are determined to press ahead in further developing security co-operation.
    Mr. Dubs: Will the Minister confirm that there is now excellent co-operation from the Republic on security and that those Unionist politicians who say otherwise are deliberately and mischievously misleading their supporters?
    Mr. Scott: All I can say is that there is improved security co-operation. The foundations have been laid for further improvements, but it will be the implementation of the reports which have now been agreed between the RUC and the Garda and which have been discussed by Ministers, that will lead to that further improvement that we all wish to see.
    Sir John Biggs-Davison: If there is this improvement—and any improvement in security co-operation is welcome—why is it that even the smallest infringement of the border by our forces in pursuit of those whom the Taoiseach has called the common enemy is built up into an international incident in Dublin?
    Mr. Scott: There is another question on the Order Paper on that subject, so I imagine that it would not be proper for me to go into great detail now. Our troops are warned about incursions into the Republic of Ireland and genuinely do their best to avoid such incursions. However, when they are in pursuit of terrorists there are occasionally incursions. We regret those and I can understand the sensitivity of the Irish Government about other troops being on their territory.
    Mr. McNamara: If Her Majesty's subjects in Northern Ireland conspire to make incursions into the Republic of Ireland and plead guilty to unlawful assembly, are they guilty of an offence within Northern Irish law for committing a conspiracy to invade a foreign country?
    Mr. Scott: That would be a matter for the courts to decide.
    Sir John Farr: While everyone welcomes the cooperation north and south of the border, has my hon. Friend analysed the situation that may arise shortly with a change of Government in the Republic?
    Mr. Scott: We have signed an agreement with the Government of the Republic of Ireland and embarked on the work of an international conference in which cross-border security co-operation is an important aspect. It is not for me to speculate about the possible results of a change of Administration. However, I hope that the co-operation which benefits everyone within the island of Ireland will be continued.

    Political Leaders (Discussions)
    Mr. Canavanasked the Secretary of State for Northern Ireland what recent discussions he has had with political leaders from Northern Ireland and the Republic of Ireland.
    Sir John Biggs-Davisonasked the Secretary of State for Northern Ireland what meetings he has had since Christmas with Northern Ireland political leaders.
    Mr. Tom King: I maintain regular contact with the leaders of the Social Democratic and Labour party and the Alliance party of Northern Ireland, but not at present with the leaders of the Unionist parties, who have unfortunately not felt able to have talks with me or my ministerial colleagues. On 28 November 1986 I met the Taoiseach and on 8 December presided as joint chairman over a regular meeting of the Anglo-Irish Intergovernmental Conference.
    Mr. Canavan: Has the Secretary of State taken the trouble to sound out Opposition politicians in the Republic as to what is likely to happen to the so-called Anglo-Irish Agreement in the event of a change of Government in the Republic in the forthcoming general election?
    Mr. King: The hon. Gentleman may not have been listening to the answer given earlier by my hon. Friend the Minister of State. It may come as a shock to the hon. Gentleman, but I entirely agree with the reply by my hon. Friend the Minister of State.
    Sir John Biggs-Davison: In the absence of withdrawal or revision of the Anglo-Irish Agreement, how does my right hon. Friend propose to end the deadlock in cooperation and communication with the political leaders of the overwhelming majority of the population of Northern Ireland?
    Mr. King: I entirely recognise, as my hon. Friend has emphasised, the importance of re-establishing a sensible dialogue. The absence of such dialogue has not been to the advantage of the Unionists of Northern Ireland in the past year or to the advantage of those for whom they seek to speak. I have made it absolutely clear that the evidence is now before them that the agreement has not threatened their position or undermined the position of the majority, nor has it infringed the sovereignty about which they are concerned. I hope they will recognise that after the sterile futility of past months there is now good sense in seeking to engage in talks on some basis. I have made it clear that I am willing to enter into any discussions without any preconditions respecting the opposition and hostility that many may feel to the agreement.
    Mr. Alton: Arising from the discussions which the Secretary of State has had with politicians in Northern Ireland, in how many local authorities Unionist politicians are fully playing their part despite their original opposition to the Anglo-Irish Agreement? Does he accept that politicians on the Alliance Benches join him in hoping that the Unionist majority in Northern Ireland will play its part here in the Chamber again as quickly as possible?
    Mr. King: I welcome the hon. Gentleman to his new responsibilities. I very much endorse the second part of his question. However, I am afraid that I am unable to help him in answer to the first part of his question, because it is very difficult at the moment to know the answer to that. The picture is very confused at the moment. However, it is quite clear that the policy of abstention, adjournment or whatever alternative versions are given to it in local authorities, has been utterly pointless. It has achieved nothing except to disadvantage local government electors and ratepayers in those areas. That point is becoming increasingly clear to sensible people in Northern Ireland.
    Mr. Cormack: Are not members of the majority population in Northern Ireland aware of how many friends, and how much influence, are being lost by the boycott on the part of their leaders both of Parliament and of my right hon. Friend and his colleagues?
    Mr. King: There is a strange concept among some people in Northern Ireland of loyalty to the Queen but of not ascribing loyalty to Parliament and any Government. People must understand that under our constitution the Queen in Parliament means that the Parliament of the United Kingdom is, in our finest tradition, the place where ultimately grievances or concerns can be raised.
    Mr. Campbell-Savours: Have political leaders in Northern Ireland ever raised with the Secretary of State the allegations of Captain Holroyd and Mr. Colin Wallace? Is it true that those allegations were communicated to the Prime Minister in 1984? Is there any substance to those allegations?
    Mr. King: The answer to the first part of the question, on which the rest of the question hangs, is no, Sir.
    Mr. Holt: Does my right hon. Friend recall that we had a debate upstairs lasting all of one minute, in which the American £50 million donation was given to this country, whether we wanted it or not? What discussions have so far taken place with the leaders of both sides in Northern Ireland on the disposition and spending of that money?
    Mr. King: The structure under which the international fund is set up is that of an independent board. It is separate from Government, and the board is about to embark on its task. I know that a number of people have made applications to it and I am sure that it can make a most useful contribution. We recognise it as a most remarkable gesture made in a spirit of goodwill and appreciation by our ancient ally, and by good friends of both the United Kingdom and the Republic of Ireland.
    Mr. Hume: Is the Secretary of State aware that had I met him since Christmas I would have raised with him the fact that the Western area health board has introduced a 12-hour working day for nurses and told them that if they do not accept they will be sacked? Is this not outrageous, and will he take steps to correct it?
    Mr. King: I am not sure how the hon. Gentleman's supplementary follows from the main question, but I shall look into the point.
    Dr. Blackburn: Will my right hon. Friend not only confirm that his door is open for discussions with members of all political parties in the Province, but make a positive step to encouraging such dialogue, because it is only through dialogue that any success will be achieved?
    Mr. King: I agree with my hon. Friend. I am grateful for what he says. If people had any doubts about it, the events of the past year have proved that alternative routes offer no prospects of a sensible outcome. People can learn only from their experiences, and I hope they will realise that it is possible to have sensible talks and that they need not be afraid that, by talking to me, they will somehow undermine the principle of their position. We shall see whether, as sensible people, we can sit down and find a better way forward that will benefit all the people of the Province.

    Prison Officers Association
    Mr. Tom Coxasked the Secretary of State for Northern Ireland when he last met the Prison Officers Association of Northern Ireland; and what issues were discussed.
    Mr. Scott: In view of my day-to-day responsibility for prisons in Northern Ireland, I normally represent my right hon. Friend at meetings with the Northern Ireland Prison Officers Association. I last met national and Northern Ireland Prison Officers Association representatives on 4 October 1985, when we discussed future employment of prison officers and their roles, prison regimes, operational matters, and the programme for opening Maghaberry prison and amalgamating the two prisons at Maze.
    Mr. Cox: In view of that answer, which shows that some 18 months have passed since the Minister met prison officers in Northern Ireland, may I suggest that he should, as a matter of urgency, seek to meet them soon? Is he aware of their deep concern as to their security and that of their families, in view of threats often made against them? Is he further aware of the complaint by them about the lack of modern facilities when on duty in prisons in Northern Ireland? As these are urgent matters, should not the Minister give them his attention soon?
    Mr. Scott: I am always ready to meet representatives of the Prison Officers Association. They have only to ask to have a meeting. There may be an early opportunity to meet their representatives.

    Anglo-Irish Agreement
    Mr. Parryasked the Secretary of State for Northern Ireland if he has any plans to visit the Republic of Ireland to discuss the Anglo-Irish Agreement.
    Mr. Flanneryasked the Secretary of State for Northern Ireland what recent talks he has had with representatives of the Government of the Republic of Ireland on negotiation of the Intergovernmental Conference.
    Mr. Tom King: We regularly meet representatives of the Government of the Republic of Ireland within the framework of the Intergovernmental Conference. The last meeting was on 8 December and I have placed the joint statements issued after this and other meetings of the conference in the Library.
    Mr. Parry: Does the Secretary of State agree that the agreement legitimises the border for the first time in history and that it is the cause of a wave of violence by paramilitary groups? Does he also agree that the conduct of the hon. Member for Belfast, East (Mr. Robinson) and his colleagues recently bears out the fears of Labour Members who voted against the agreement?
    Mr. King: I note what the hon. Gentleman said about the agreement legitimising the border and I know that that is a view advanced by many. It confirms the position of the majority in Northern Ireland, in that they are not at any risk of being dragooned into a united Ireland against their wishes. That reassurance of the majority is an important component of the agreement, and, coupled with respect for the traditions and interests of the minority, is the right basis on which a better long-term understanding can be reached within Northern Ireland.
    Mr. Flannery: Was the question of the unsatisfactory nature of the Diplock courts or the question of having three judges instead of one, which surely would be more satisfactory, raised? What is transpiring in that general direction?
    Mr. King: The Diplock courts and the problems of terrorist trials which must be conducted without a jury, as is the position in a current case in Dublin, have been discussed. I made clear the Government's position on those matters in an earlier reply, to which I draw the hon. Gentleman's attention.
    Mr. Gow: Do Her Majesty's Ministers and Ministers of the Government of the Irish Republic believe that it is possible to govern one part of the United Kingdom differently from the rest, save with the consent of a majority of the people who are to be governed differently?
    Mr. King: My hon. Friend will know that there has been no change in the arrangements for the government of Northern Ireland during the course of this Government. It is precisely one of the strengths of the agreement that it does not affect the method of government of Northern Ireland, while at the same time respecting the interests and traditions of the minority.
    Mr. Winnick: There is certainly a curious alliance in the House against the Anglo-Irish Agreement. Has it occurred to the Secretary of State that there might be a case for having a referendum on this unique situation, both in the Republic of Ireland, if that was the wish of the Irish authorities, and in Britain and Northern Ireland? If that referendum secured, as indeed it would, a large majority, would it not strengthen the agreement?
    Mr. King: I agree that there can be curious alliances in matters affecting Northern Ireland, and perhaps I know that as well as anyone. The hon. Gentleman makes a serious point, because he will know that there have been suggestions of an application for some form of referendum, and one of the questions that it would raise is what should be the constituency for that referendum.
    Mr. Bell: Will the Secretary of State confirm that the Anglo-Irish Agreement had the full support of this House, as it had the full support of the Irish Dail? Therefore, it has the full support of two sovereign peoples. Is it not a fact that the Anglo-Irish Agreement provides as much opportunity for the Unionist community to reflect its traditions and history as it does for the Nationalists? There is something in the Anglo-Irish Agreement for both traditions. Is that not the case?
    Mr. King: I am grateful to the hon. Gentleman for his comments, and I certainly endorse his remark that the overwhelming majority both in this House and in the Parliament of the Republic, and the much wider international community, welcomed this measure. The tragedy is clearly that at present Unionists do not recognise that the real beneficiaries of a more willing acceptance and understanding of the fairness of their position in relation to the minority community would be the majority community in Northern Ireland.
    Mr. Alton: Does the Secretary of State agree that the reconciling process which the Anglo-Irish Agreement is about is not helped by inflamatory language such as that deployed earlier this week by Viscount Brookeborough when he described Cardinal O'Fiaich as "an evil prelate"?
    Mr. King: There is a responsibility on all people in positions of influence to take care not to inflame passions. It is the easiest thing in the world to excite hatred in Northern Ireland, which often leads in other circumstances to extremely nasty acts and incidents. Everyone in positions of responsibility needs to exercise great care in the language that they use.

    Harland and Wolff (AOR Contract)
    Mr. Nicholas Brownasked the Secretary of State for Northern Ireland if he will make a statement on his monitoring of the auxiliary oiler replenishment vessel contract at Harland and Wolff.
    The Parliamentary Under-Secretary of State for Northern Ireland (Mr. Peter Viggers): Construction work on the auxiliary oiler replenishment vessel is scheduled to commence later this year. Harland and Wolff's performance and costs in building this ship will be subject to a stringent system of financial and performance controls which will be monitored by independent consultants.
    Mr. Brown: As the Northern Ireland Office is not impartial in this matter will the Minister name the independent consultants that his Department is using to monitor the contract and tell the House what arrangements are being made for independent scrutiny of that contract?
    Mr. Viggers: The consultants are Touche Ross management consultants. The hon. Gentleman inquired about the availability of the report. The terms of reference given to the consultants extend beyond the specific question of AOR monitoring and it is not appropriate to release what is effectively a commercially confidential contract. However, I can confirm that Harland and Wolff's performance and costs in builiding AOR will be monitored strictly in accordance with the terms of the Secretary of State's announcement on 24 April 1986.

    Anglo-Irish Agreement
    Mr. Archerasked the Secretary of State for Northern Ireland when he will next meet the leaders of the political parties in Northern Ireland to discuss the operation of the Anglo-Irish Agreement.
    Mr. Soleyasked the Secretary of State for Northern Ireland what representations he has received from Unionist parties in Northern Ireland on the Anglo-Irish Agreement; and if he will make a statement.
    Mr. Tom King: Unfortunately, the leaders of the Unionist parties feel unable to have discussions with me, but I am obviously aware of several concerns felt by members of the Unionist parties and I remain ready to discuss with them the Anglo-Irish Agreement, or any other matters, at any time. I meet the leaders of the Social Democratic and Labour party and the Alliance party regularly and hope to meet them again soon.
    Mr. Archer: As the whole purpose of the Anglo-Irish Agreement was to facilitate discussions with the Republic, would it not be pointless if it led to the termination of discussions with everyone else? Will the Secretary of State confirm that any proposal emerging from the Intergovernmental Conference will be the subject of consultations with any party or group in Northern Ireland

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    which wishes to express a view on the merits? For that purpose, will it be made known in good time before the proposal is implemented?
    Mr. King: I am more than ready completely to endorse what the right hon. and learned Gentleman has said. One of the least truthful statements in Northern Ireland is that somehow the Unionists are debarred from putting forward their views and opinions. I have made it absolutely clear that I would welcome them at any time, and I hope that they will take up those opportunities.
    Mr. Soley: When the Secretary of State next meets the Unionist parties, will he reiterate that no agreement jointly negotiated between the British and Irish Governments can be destroyed by threat of force or undermined by a veto applied by any group or political party? Can he make it absolutely clear to them that the will of two democratically elected Parliaments of Britain and Ireland is sovereign in these matters?
    Mr. King: Of all the people in Northern Ireland, I would have thought previously that it was least necessary to remind Unionists that the United Kingdom Parliament is sovereign and that its views should be respected.

    Border Incursions
    Mr. Peter Bruinvelsasked the Secretary of State for Northern Ireland what advice is being given to the security forces concerning recent incursions into Southern Ireland.
    Mr. Scott: Police and Army commanders are well aware of the importance of avoiding incursions. Policemen and soldiers, particularly those belonging to newly arrived units, are advised frequently of the need to avoid incursions into the Republic of Ireland when operating close to the border.
    Mr. Bruinvels: While thanking my hon. Friend for his detailed reply, may I ask him to confirm that it is not just a matter of troops from Northern Ireland going into the South, but of troops from Southern Ireland crossing the border into the North? We should have a give and take policy, and it is rather unfair that some legal authorities in Southern Ireland are promoting the fact that some of our troops have lost their way on the border.
    Mr. Scott: It is important to recognise that in effectively carrying out their duties the security forces of both jurisdictions have to operate right up to the border. The troops are, of course, forbidden to cross the border, but incursions into both jurisdictions take place from time to time as a consequence of the joint pursuit of the common enemy of both security forces—the terrorist. I should mention that this matter was discussed at the last meeting of the Intergovernmental Conference.

  PRIME MINISTER

    Engagements
    Mr. Chris Smithasked the Prime Minister if she will list her official engagements for Thursday 15 January.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in this House I shall be having further meetings later today.
    Mr. Smith: Is the Prime Minister content that her Government preside over a society in which the chairman of Guinness can earn £350,000 a year while thousands of pensioners—[Interruption.]—are freezing because they cannot afford to heat their homes? Is such a gulf between the rich and poor not an inevitable consequence of the Prime Minister's and her Government's philosophy and system of values?
    The Prime Minister: With regard to the first part of the question, the hon. Gentleman knows that we are to have a reply to a private notice question later today.
    The way in which this Government have looked after the needs of pensioners in severe weather is greatly in excess of the services and amounts that any other Government have previously given. The severe weather payments are on top of the scale rates for heating in the supplementary benefit payments, and on top of the heating additions that are paid regularly throughout the year.
    Mr. Couchman: In the present dreadful spell of cold weather, perhaps Kent has suffered as badly as anywhere. Many shops in my constituency are virtually out of food and access to the Medway towns is almost impossible. Movement is very difficult indeed. Will my right hon. Friend give urgent consideration to whether we should declare a state of emergency? That could help the situation. Will my right hon. Friend further consider giving permission for the unfettered use of troops, without consideration of budget?
    The Prime Minister: I do not consider that a declaration of a state of emergency would be appropriate. Of course, we shall see how help can be brought in to move in food and necessary supplies to people who are without them.
    Mr. Kinnock: Has the Prime Minister's attention been drawn to the commendable view expressed in the Financial Times this morning that self-regulation can work only if people who are supervised have a sense of obligation towards the system and if that is greater than the desire to win their way in any particular case? In view of the widespread disquiet about financial dealings, including in the City itself, will the Prime Minister now take steps to make the Securities and Investments Board a statutory body with powers to investigate and prosecute any cases of abuse during mergers and takeovers?
    The Prime Minister: I think not at present. Most people will accept that action has been taken very quickly indeed in setting up inspections under the Companies Act by Board of Trade inspectors. We must await the result of the report. It is far too early to go from the present voluntary self-regulation and conclude that we should go to a full statutory system. The right hon. Gentleman referred to the Financial Times. He will find that there were leaders in overseas papers, including in the United States, saying that the speed at which action has been taken under the voluntary system has sometimes exceeded the swiftness of action under any statutory system.
    Mr. Kinnock: From the Prime Minister's answer, are we to believe that if the current evidence of gross abuse were to continue we would, in a short time, have the introduction of a statutory system so that full force could be brought to bear against those who are abusing their knowledge and office in the course of mergers or takeovers, or are we to believe that because statutory

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    schemes have not been introduced elsewhere there is no circumstance in which the Prime Minister would wish one to be introduced in Britain?
    The Prime Minister: The right hon. Gentleman concludes too much. Insider dealing was not even a criminal offence under the Labour Government, yet it is now. But then, he is always expecting something totally different from us. We have made insider trading a criminal offence and, the right hon. Gentleman knows, criminal prosecutions are a matter for the appropriate authorities and not for the Government. Board of Trade investigations are implemented under the Companies Act and come under the responsibility of the Secretary of State for Trade and Industry. Inspections have been implemented very quickly, and they are now under way.
    Mr. Kinnock: The value of mergers and takeovers has multiplied tenfold during the time that the Prime Minister has been in office, so these matters are of great importance to hundreds and thousands of people, both inside and outside the City. The Prime Minister introduced deregulation and is now having to clean up the mess left by the abuses of that system. Will she make the SIB statutory in order to help with that process?
    The Prime Minister: I answered that question in my initial reply to the right hon. Gentleman. There are two factors. First, insider trading is now a criminal offence although it was not a criminal offence under a Labour Government. Secondly, there is now voluntary regulation, and I believe that there are powers in statute eventually for Ministers to take over if voluntary regulation turns out not to be right. However, it is much too soon to judge. Action has been taken very quickly by Board of Trade inspectors under the present system. They are in the process of establishing the facts. Indeed, if the right hon. Gentleman thought about it, he might agree that it is as well to establish the facts before drawing any conclusions.
    Mr. Hanley: My right hon. Friend has shown her great concern for those most in need by acting swiftly to help to provide the additional heating allowance. Does she not therefore utterly condemn the actions of staff at the main post office in East Sheen in my constituency in closing their doors for the past five working days because, they claim, it is too cold to work? They have thereby locked out claimants, including pensioners, thus ensuring that they cannot cash their benefit cheques. As a result, those people cannot buy food or fuel——
    Mr. Speaker: Briefly.
    Mr. Hanley: Those people are therefore having to trudge in the snow and slush to sub post offices that are prepared to open.
    The Prime Minister: My hon. Friend has made his point very effectively. However, we would all wish to praise and thank those who have gone to work, despite the difficult circumstances. They have been determined to carry on with their jobs and to get medical help, supplies or cash to those who need them. Perhaps that serves to highlight those who have not made such efforts.
    Dr. Owen: In view of the widespread concern about the young single homeless, which will go on long after the cold weather snap, will the Prime Minister reconsider the board and lodging regulations as well as the possibility of giving special help to local councils for emergency programmes
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    to help young people? It is no answer to say that council houses are still standing vacant, because under the Act councils do not have responsibility for the young single homeless. There is a major gap in our social provision, and some action would be very welcome.
    The Prime Minister: I think that it is an answer to say that there is a good deal of council house property standing vacant. If housing is not being used, it could obviously be put to use for homeless families. It is because the right hon. Gentleman knows that that is an answer that he tried to avoid it in his question.
    Sir Peter Tapsell: Will my right hon. Friend please bear in mind that although the existence of a statutory body in the form of the Securities and Exchange Commission in the United States did not prevent the Boesky scandal, some of us have felt for some time that the increasing internationalisation of financial markets, with all the complexities and difficulties for national regulation that they bring, means that we should now look towards a statutory body to help with these matters?
    The Prime Minister: It is too soon to conclude that we should change the present system, which has been in operation for only a short time. As my hon. Friend knows, there is provision for my right hon. Friend the Secretary of State for Trade and Industry to take statutory powers. However, we should go further with the present system before we conclude that we should go to a statutory one.
    Miss Maynardasked the Prime Minister if she will list her official engagements for Thursday 15 January.
    The Prime Minister: I refer the hon. Lady to the reply that I gave some moments ago.
    Miss Maynard: Does the Prime Minister agree that it is a scandal that, 15 months after her Government promised to review the case of the six men convicted of the Birmingham pub bombings, the Home Office still prevaricates? Does she further agree that nothing undermines the rule of law more than keeping innocent people in gaol because authorities do not have the courage to admit that they made a mistake? Will she reassure the House today that her Government are conducting a genuine investigation and not a cover-up?
    The Prime Minister: My right hon. Friend the Home Secretary continues to review that case carefully and will inform the House of his conclusions when he has reached them.
    Mr. Neil Hamiltonasked the Prime Minister if she will list her official engagements for Thursday 15 January.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Hamilton: Is there any country in which unmployment is falling faster than in the United Kingdom?
    The Prime Minister: Suffice it to say that, on a seasonally adjusted basis, unemployment has fallen here for the fifth successive month. That is good news. We hope that that will continue, although we are bound to have problems. It is also good news that unemployment is falling in the north, the north-west, the west midlands and Wales. I hope that the whole House will welcome that news.
    Mr. Norman Atkinsonasked the Prime Minister if she will list her official engagements for Thursday 15 January.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Atkinson: Has the Prime Minister seen this morning's report by the Royal Institute of Public Administration, which dubiously clears her of politicising the top echelons of the Civil Service? In view of that report and all the implications, together with the criticism that has been made of her decision not to allow civil servants to appear before Select Committees and truthfully answer questions without the permission of the Secretary of State, will she now reconsider her previous answer and allow civil servants the openness that is recommended in the report?
    The Prime Minister: I do not wholly accept the underlying premise of the hon. Gentleman's question. The Select Committee asked how far civil servants could properly answer for their own conduct in a particular case. There are certain strong traditions in relation to that. I am sure that people would not wish to undermine those traditions or in any way to turn the House into a kind of conduct court when they have their own disciplinary procedure. With regard to what the Royal Institute of Public Administration said, we should pay tribute to the impartial administration and the traditions and standards of the Civil Service.
    Mr. Hayward: Will my right hon. Friend consider today the comments made recently by a senior political analyst on local radio in Bristol to the effect that the loony Left is damaging the Labour party, that the economy is in reasonable shape and that the Conservatives will win the next election? The senior political analyst concerned was the right hon. Member for Bristol, South (Mr. Cocks).
    The Prime Minister: The point in that most excellent dissertation with which I wish to quarrel is that it is not the loony Left but the Left in power in local authorities. That is the way in which the present Labour party acts when in power.
    Mr. Terry Davisasked the Prime Minister if she will list her official engagements for Thursday 15 January.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Davis: As the Prime Minister is so pleased with the latest unemployment figures, will she now confirm that the cumulative effect of the past five months has been to reduce the unemployment rate from 11·4 per cent. a year ago to 11·3 per cent. in December? As she is so easily pleased with the figures, is she aware that my constituents think that it is because she does not really care?
    The Prime Minister: Hon. Gentlemen have been mouthing the phrase "people care", but we know that that is not the case from the record of Opposition Members on many social service issues and by the way in which they did not hesitate to reduce the value of pensioners' savings by inflation. I would have hoped that the hon. Gentleman would be pleased that unemployment has fallen for the fifth month running and that over 1 million more jobs have been created in the past three years. That is a good record and the prospects for the economy look good for the coming months.
    Mr. Thurnhamasked the Prime Minister if she will list her official engagements for Thursday 15 January.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Thurnham: Will my right hon. Friend take time during her busy day to observe how the number of building society depositors has increased since she came to power? Does she agree that those 28 million investors set a good example of thrift and that their savings would be whittled away by the inflationary policies advanced by Opposition Members?
    The Prime Minister: Yes. The number of building society investors has increased enormously. It is part of the wider distribution of property in terms of housing, personal savings and possibly shares. That is part of the Conservative party's and the Government's fundamental philosophy. I wholly agree with my hon. Friend that under this Government savers, who are so important because without savings we do not have the means of the investment that we wish to see, have had a good deal and will continue to do so, and that under a Labour Government they would have a very bad deal because of the Labour party's inflationary policies, which would rob the savings of their value.

Guinness plc
3.32 pm
Mr. Robin Cook(by private notice) asked the Secretary of State for Trade and Industry if he will extend the investigation into the affairs of Guinness in the light of recent events at that company and its corporate advisers.
The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Michael Howard): The inspectors appointed to look into the affairs of Guinness already have wide terms of reference which enable them to investigate any matter concerning Guinness and to require any persons, including its corporate advisers, whom they consider to have relevant information to give evidence to them. As and when I receive any material suggesting misconduct in a matter not concerning Guinness, I will consider it and take any appropriate action. I shall certainly not hesitate to make a further appointment, of inspectors if the circumstances justify it.
Mr. Cook: Is the Minister aware that it is believed in the City that as many as 90 million shares in Guinness may have been bought during last year's bid on the basis of improper indemnities by Guinness? Is he aware that the trail of the slush fund with which they were financed leads through some of the most hallowed and established names in the City? Is it not now clear that we are in the middle of the biggest City scandal for a generation, so big that even the public relations talents of Sir Gordon Reece could not keep it under wraps?
Does the Minister recognise that the blame for those events cannot be shuffled off on to a few individuals who have been thrown overboard? Does he recognise that the Government have encouraged the takeover stampede by their relaxed attitude to such bids, of which today's announcement about Pilkingtons is merely the most astonishing? Does he recognise that the Government have achieved only a trickle of prosecutions for fraud in the City in stark contrast to their attitude to fraud in the social security system? Is it not clear that the Government have created a climate in the City in which anything goes?
Can the Minister assure the House that the Department of Trade and Industry inquiry was not discussed when the Prime Minister attended a private lunch last week at the London office of Bain and Co. which employed the financial director who has just been dismissed by Guinness?
Given the scale of the scandal and the £200 million of improper share dealing, why did the public authorities apparently not detect anything wrong until tipped off nine months later by the American authorities? Surely this week's events must have shaken even the Minister's complacency about leaving the regulation of the City to self-regulation by the City? Why does not the Minister admit that we desperately and urgently need an independent public watchdog to restore law and order in the City of London?
Mr. Howard: The House will not expect me to comment on the circumstances presently being inquired into by the independent inspectors who have been appointed to look into the affairs of Guinness. I would not wish to take any step that would be likely to impede their investigations. However, of one thing there can be no doubt: there is no
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question of keeping anything under wraps. If anything merits investigation, it will be investigated fully, properly, thoroughly and effectively.
The hon. Member for Livingston (Mr. Cook) has come out with the hoary and entirely misconceived assertion that prosecutions for insider dealing are inadequate. He knows that the record of prosecutions that have taken place since insider dealing was made a criminal offence by this Government leaves something to be desired. That is precisely why we have taken powers of an unprecedented nature in the Financial Services Act 1986. Those powers require people to answer questions put to them by investigators, even if such questions will incriminate them, on pain of punishment for contempt of court. That is a measure of the Government's determination to root out malpractice and misconduct in the City whenever evidence of it comes to our attention.
Sir Alex Fletcher: I congratulate my hon. and learned Friend on the expeditious use he has made of the new powers available to Companies Acts inspectors. As the major question raised by this sordid affair is the legality of the Guinness takeover of Distillers, a matter that may well involve the Director of Public Prosecutions and the courts for many months, what steps does my hon. and learned Friend propose to take to protect the interests of the shareholders involved against any actions by Guinness that may further prejudice their interests as shareholders?
Mr. Howard: I cannot comment on the affairs of Guinness. However, my hon. Friend will appreciate that it is now under new direction and I have no doubt that those responsible will take his comments to heart.
Mr. Ian Wrigglesworth: Does the Minister agree that there is already sufficient information in the public domain to make it quite clear that the whole affair stinks and is leaving a dreadful aroma over the whole of the City? Does he also agree that we have seen enough information already to cause deep offence to many people in the City and other parts of the country and, therefore, will he tell the House what resources are being made available to carry out the investigation with the utmost expediency? Can the Minister give some indication as to when he expects the investigation to be completed and say that he will make a full statement to the House when it has been completed and reported to him?
Mr. Howard: The investigations are being conducted by independent inspectors who are not subject to any constraints on the resources available to them. They are well aware of the need to complete the investigations as soon as possible, subject only to the need to carry out a full, thorough and effective inquiry. I fully expect that, as soon as they report, the report will be made public.
Sir Edward Gardner: Does my hon. and learned Friend agree that it is offensive in principle and injurious in practice that a famous company such as Pilkingtons that can promise to revive the prosperity of the north of England should be put in peril by the predatory activities of another company such as BTR?
Mr. Speaker: We should have questions about Guinness, not Pilkingtons.
Mr. Robert Sheldon: Is the Minister aware that we are talking not about a few individuals who have done something wrong but about

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some of the most prominent names in the City of London, such as merchant banks and solicitors, as well as those who have responsibilities for the stockbroking aspects of this matter? Dealing with such prominent names is rather different from dealing with a few individuals who might be castigated at some stage in the future.
Is the Minister aware that many of us suspect that none of this might have come out had it not been for information gathered from the United States that set off the whole investigation? Will the hon. and learned Gentleman accept that we are not talking about small matters? We need proper regulation of such problems if the City of London is to hold anything like the place that many of us expected for it when deregulation started.
Mr. Howard: I cannot comment on the source of the information which led to the appointment of inspectors in this case, but I can say that as soon as that information came to the attention of the Department we acted speedily and promptly to appoint independent inspectors to investigate matters.
As for the more general regulation of the City, the regime provided for under the Financial Services Act 1986 will prove to be effective. However, we shall scrutinise with care the report of the Guinness inspectors, and we shall be anxious to learn any lessons from it that we can.
Several Hon. Members rose——
Mr. Speaker: Order. I remind the House that a private notice question is an extension of Question Time. We have a further private notice question on Pilkington. I shall allow two questions from either side.
Mr. Bill Walker: I congratulate my hon. and learned Friend and his inspectors on the way in which they have conducted their duties thus far. Does my hon. and learned Friend agree that I was the first Member in the House to raise the matter of how Guinness and Morgan Grenfell were behaving? Does he also agree with the comments that I made on 25 July 1985 regarding that, and the way that the takeover panel had fallen far from the standards required for self-regulation? I support self-regulation, but when one finds that the individuals who are carrying out the duties are falling short, it is right that it should he commented on.
I also draw my hon. and learned Friend's attention to the fact that one of the few hon. Members——
Mr. Speaker: Order. The hon. Member should ask questions, not make statements.
Mr. Walker: Does the Minister agree that the hon. Member for Livingston (Mr. Cook) is one of the few Opposition Members who have been consistent in this
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matter and is to be congratulated, unlike others, such as the Leader of the Opposition, who supported Guinness, and who are now being noisy about it?
Mr. Howard: The Opposition have been far from consistent in their approach to these matters, but I can confirm that my hon. Friend has been vigorous in drawing material to the attention of the Department.
Mr. Tom Clarke: In view of the potential for further job losses if Guinness continues with its present programme, especially in Scotland, will the Minister—or better still the Secretary of State—use his influence to invite Guinness to withdraw its notorious rationalisation programme, especially since it flies in the face of all the pledges that were given by Mr. Saunders during the takeover campaign?
Mr. Howard: These are matters for the company. I am sure that it will take all the circumstances into account in making its decision.
Sir Anthony Grant: As during many years of Labour Government absolutely nothing was done to legislate against such scandals, will my hon. and learned Friend reject as humbug what the Opposition say? Nevertheless, does he agree that in recent years some people have entered the City who are long on cunning but short on morals? Is it not a great pity that some of the energy and talent used in shuffling paper in takeover deals is not used to increase existing productive business?
Mr. Howard: For the most part, standards in the City remain high. It is important that we should acknowledge the great contribution which the City makes to our economy, earning £7·5 billion for Britain in net foreign exchange in the latest year for which full figures are available. That makes a significant contribution to our productive economy.
Mr. Dick Douglas: Will the Minister accept that the House is not really persuaded by his argument that this is a little local difficulty involving only insider trading? Will he give us, particularly in Scotland, some assurances on the possibility of going down the line and looking at the activities of the Saunders syndrome in relation to the takeover of Bell's? Many Labour Members, including myself, who were anxious about those activities and received some assurances on headquarters, employment opportunity and so on—I have a substantial Bell's plant in my constituency—would like to know the Government's intention in that regard.
Mr. Howard: I have already described to the House the inspectors' terms of reference, and they are very wide.

BTR and Pilkington Bros.
3.45 pm
Mr. John Evans(by private notice) asked the Secretary of State for Trade and Industry if he will make a statement on his decision not to refer the bid by BTR for Pilkington to the Monopolies and Mergers Commission.
The Secretary of State for Trade and Industry and President of the Board of Trade (Mr. Paul Channon): I decided, in accordance with the recommendation of the director general of Fair Trading, not to refer the merger between BRT plc and Pilkington Brothers plc to the Monopolies and Mergers Commission under the provisions of the Fair Trading Act 1973.
I accepted the director general's advice that the merger did not raise significant competition issues. Like the director general, I gave careful consideration to concerns expressed about the effect of the proposed takeover on Pilkington's management philosphy and commercial direction. While accepting that these are important issues, I believe that the shareholders of Pilkington are best placed to make a judgment on them.
Mr. Evans: Is the Secretary of State aware that his decision not to refer the bid has been greeted with widespread dismay by the entire Pilkington work force throughout Great Britain? Will he accept that the involvement of Morgan Grenfell in the bid, which is already deeply involved in the Guinness scandal, means that it would have been in everyone's best interest, particularly the right hon. Gentleman's, if the bid had been referred to the Monopolies and Mergers Commission, particularly in view of the 20p surge in Pilkington's share price last night?
The right hon. Gentleman informs the House that there is no competition policy involved. He also states that Pilkington's management philosophy and the commercial direction of the company are best left to the shareholders. Who then speaks for the national interest and for the interests of the work force and its jobs? Pilkington's work force throughout Great Britain intends to step up its compaign against the bid by BTR because it recognises that the bid has no industrial logic. Why cannot the right hon. Gentleman recognise that?
Mr. Channon: I understand and respect the hon. Gentleman's views. Indeed, he came with a deputation to discuss the matter with me and I listened with great care to the arguments that he presented. What I have decided today is entirely consistent with the policy announced as long ago as July 1984 and applied ever since—that references are made primarily on competition grounds. I express no views on the merits of the BTR bid for Pilkington, but I am sure that the hon. Gentleman's influence and the influence of those for whom he speaks will be powerful in convincing people on how to vote.
Mr. Kenneth Hind: Does my right hon. Friend appreciate the disappointment of many of the Pilkington employees in the north-west at the non-referral of BTR's bid to the Monopolies and Mergers Commission? However, some Conservative Members appreciate that there was a major lack of a monopoly element that would have provided him with the major ground to do so. Will he bear in mind that, through research and development and hard work, a loyal work
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force in Pilkington has made that company the premier glass manufacturer in the world? That loyalty will not easily be transferred to a conglomerate run by BTR? Will he ensure that the Pilkington shareholders will, having seen the impressive profit forecasts and long-term stable investment, be allowed to maintain their investment free from the sort of interference that we saw in the Guinness bid for Distillers in the recent past?
Mr. Channon: I understand my hon. Friend's views, and I know that he has strong feelings about this matter. I am sure that he will make his views widely known. It is now for the Pilkington shareholders to weigh up the arguments. They will have to decide on the best long-term prospects for the future of the company. The whole House accepts what my hon. Friend says about the great achievements of Pilkington. The shareholders have an important decision to take about the best long-term prospects for the company.
Mr. David Alton: Does the Secretary of State accept that this decision is inconsistent with the decisions about the Royal Bank of Scotland and Sothebys which were referred to the Monopolies and Mergers Commission? Does he agree that other factors should be taken into account and that the rules should be changed so that matters of this sort can be considered? This takeover would be a calamity in an area where already one person in five is out of work. Does he also agree that, when a company has made itself vulnerable because of its investment in research and development, it is unacceptable to allow it to be preyed on by a predator like BTR?
Mr. Channon: The cases cited by the hon. Gentleman were before July 1984. I recall that years ago there were many complaints about the unpredictability of reference policy and a wish to have a predictable set of criteria on which one could judge whether cases were likely to be referred. As I have told the House, what I have said today is entirely consistent with the policy announced in July 1984 that references are made primarily on competition grounds. There have been almost no exceptions to that rule.
Sir Anthony Meyer: Whatever the difficulties facing my right hon. Friend—and they are real difficulties—is he aware that he, the Government and the Conservative party will bitterly rue the day when they seemed to be washing their hands of the future of a firm so outstanding for its technical achievement, its care for its work force and for its contribution to regional policy?
Mr. Channon: I understand my hon. Friend's feelings. He must understand that had a reference to the Monopolies and Mergers Commission taken place it would not necessarily have prevented the takeover of Pilkington by BTR. If the commission makes a recommendation that such a takeover is not against the public interest, I have no power whatever to stop it.
Mr. George Park: Does the decision not to refer the BTR bid to the Monopolies and Mergers Commission indicate a preference for expansion by acquisition rather than growth through good research and development, good industrial relations and good marketing?
Mr. Channon: It shows no preference whatever. All these factors are relevant to the Pilkington shareholders in weighing up what they should now do.
Mr. Mark Carlisle: Even if the bid does not come within the narrow confines of a reference to the Monopolies and Mergers Commission, does my right hon. Friend agree that it would be a great pity if a great manufacturing company like Pilkington which has played such a major part in the industrial life of St. Helens and the whole of the north-west should cease to remain an independent company?
Mr. Channon: It would not be right for me to express a view about its merits. It would also be quite wrong for me to express a preference for one of the two courses that are offered. My right hon. and learned Friend has mentioned an important series of issues which the Pilkington shareholders will have to consider. I am sure that they will weigh carefully what he says.
Mr. Eric S. Heffer: All hon. Members from the north-west are well acquainted with Pilkington and know about the work that has been done by its workers and management. Will the right hon. Gentleman reconsider his earlier answer? Will he put the interests of the community and the people of the northwest before the rather strange concept that competition must decide everything? Is it not clear that some shareholders may think that it is better to get a financial killing than to take account of the interests of local people?
Mr. Channon: I had to decide whether to refer this matter to the Monopolies and Mergers Commission. I cannot reconsider the decision that I have announced. [HON. MEMBERS: "Why not?"] Pilkington's shareholders must weigh up all these arguments and the strong feeling in all parts of the House and outside. I have not announced today that BTR has taken over Pilkington, or that it is likely to do so. All that I have decided to do is not to refer the matter to the commission.
Mr. Michael Grylls: Is this not a further example of the merger mania that seems to be rife? I believe that my right hon. Friend has shown wisdom in deciding to have an immediate review of competition policy. It should also consider the preservation of research and development and the future security of many small and medium-sized firms, which are suppliers to the big ones.
Mr. Channon: I agree that it is right to review competition policy in relation to mergers and restrictive trade practices. My hon. Friend's points and the evidence he gives to that review will be of value in helping me to decide on the issues involved.
Mr. James Callaghan: I venture a guess that there is a majority opinion in this country, and probably in the House, against the takeover. If the Minister feels that he is under a disability in expressing an opinion about it because of his responsibilities as Secretary of State for Trade and Industry, why cannot the Prime Minister call in the chairman of BTR, tell him what the view is and invite him to withdraw his offer?
Mr. Channon: The House has heard what the right hon. Gentleman has said. Surely he will accept that it would be quite wrong for any Secretary of State for Trade and
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Industry to express a view from this Dispatch Box as to the merits of one side or another when a bid has been made.
Mr. William Powell: Does my right hon. Friend accept that, notwithstanding his decision, it will be greeted with dismay by many thousands of Pilkington workers, including those in my constituency? Does he also accept that the views that have been expressed on both sides of the House make it perfectly plain that it is very much in the national interest that companies with a strong regional base should be allowed to flourish and that companies that put maximum effort into research and development and their long-term future should also be allowed to flourish? Will he take an early opportunity to make it perfectly plain to the Pilkington shareholders and others that the Government have considerations of that kind very much in mind?
Mr. Channon: I agree with my hon. Friend that it is important that companies with a strong regional base should flourish and that it is also important that companies with a strong research and development base should flourish.
Mr. Jim Craigen: What does the Secretary for State have to say to the 2,500 employees of Barr and Stroud in the Glasgow area whose jobs are geared to research and development and defence contracts? Does he believe that BTR's management philosophy recognises the long-term potential of high-tech as against the short-term advantage of profit?
Mr. Channon: Those involved have to decide. It is not for me to make a judgment between those two management philosophies, if they have been accurately so described by the hon. Gentleman.
Mr. Gerald Bermingham: Does not the Secretary of State agree that there comes a point when the state or the Government have a responsibility? There comes a point when the balance between commercial interests and those of the state has to be taken alto account. Does not the Secretary of State agree that we have here a takeover bid which makes little or no industrial sense? I agree that it is not a competition point, but it is certainly a point in the public interest. Does he not feel that he has some duty to interfere in this apparently competitive situation so as to ensure that an independent company which has both local and regional interests should be given some protection from the predators that now exist in our industrial society?
Mr. Channon: It is very difficult to reach a decision in a case of this kind. I had to weigh all the factors involved before coming to the decision that I took. It was wholly consistent with decisions taken over many years—that references should be made primarily on competition grounds. It is only reasonable and right that there should be some element of predictability and consistency in these decisions, and I am satisfied that what I have done today is in accordance with that, and is right.
Mr. Speaker: I made a mistake in calling in succession two Members from the Opposition Benches, so I will call two on the Government Benches.
Mr. Tony Favell: Will my right hon. Friend beware of the call from Socialists for control over every takeover bid because that is the first step to bureaucratic

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control over the City and over the country's savings? Having done so, will my right hon. Friend point out to investment managers that they have a responsibility beyond what is described by my right hon. Friend the Chancellor as "short-termism" and have to look to industry, the community and the country when considering whether to back a bid? Will he also point out to the newspapers that by not referring a bid such as Simons only last week to the Monopolies and Mergers Commission he is not giving the green light to those seeking to take over the company?
Mr. Channon: I agree with everything that my hon. Friend says, and I am grateful to him for pointing out these facts. It is now up to the shareholders of Pilkington to weigh up all the arguments put in front of them and to come to a decision as to their best course for the future.
Mr. Anthony Nelson: Does my right hon. Friend agree that it is a very dangerous route for any Secretary of State to use the mechanism of referral to the Monopolies and Mergers Commission for seeking to frustrate a takeover bid for reasons other than the national interest, as clearly defined in the Fair Trading Act 1973? Should there not continue to be a clear presumption that shareholders know best how to dispose of their assets?
Mr. Channon: I entirely agree with my hon. Friend.
Mr. Robin Cook: Surely the dominant share of the glass market that Pilkington at present enjoys is itself a ground for referring on grounds of competition policy any bid to take over the ownership of that company. Does the Secretary of State accept that large parts of British industry these days will regard as outstandingly naive his view that shareholders take any other than the short-term view of what affects their share price?
Does the right hon. Gentleman appreciate that Pilkington provides many jobs in regions where the Government have created large numbers of unemployed and that it has a proven track record in developing high technology? It is his job to protect British jobs and British technology. Why, then, is he standing aside to let a predator pounce—a predator with a proven track record of selling off British technology to foreign companies?
May I press the Secretary of State on the point made earlier by my hon. Friend the Member for St. Helens, North (Mr. Evans) that the market plainly knew about his
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decision yesterday? Is it not clear that, despite the brave talk of his colleague about stamping out insider dealing, his Government have not yet succeeded in stopping the leaks from his own Department?
Mr. Channon: As to the latter part of the hon. Member's question, I have no evidence of that whatsoever. If he has evidence of it, of course I will look at it and refer it to the inspectors.
As to the earlier part of the question, of course I recognise—the whole House does—that Pilkington's record on high technology is extremely good. I also recognise that the company employs a large number of people in the north-west. It is for the shareholders to decide what is in the best long-term interests of the prosperity of Pilkington. I am sure that they will bear very much in mind the excchanges in the House.
Mr. Norman Atkinson: On a point of order, Mr. Speaker.
Mr. Speaker: Arising out of questions?
Mr. Atkinson: Yes, Mr. Speaker. I should like your advice. You will recall that, in answering questions about Guinness, the Minister of State, in answer to a point put to him by the hon. Member for Edinburgh, Central (Sir A. Fletcher), who asked him to look after the interests of the shareholders of Guinness, nodded approval. Similarly, the Secretary of State, throughout his answers on Pilkington, has replied in a similar way by agreeing that he and, indirectly, the House have a responsibility to ensure the integrity of shareholders' interests——
Mr. Speaker: Order. I am not responsible for movements of the head or for questions or answers given from the Back Benches or the Front Benches.
Mr. Atkinson: Indeed, Mr. Speaker. I am seeking your advice as to what responsibility the House has when it comes to guaranteeing anything to shareholders. It is under no obligation to them whatsoever, and the Minister of State ought to reconsider the nod that he gave.
Mr. Speaker: I have no doubt that there will be debates on this matter and that these are legitimate points to raise, but they are not matters of order.
Mr. Bill Walker: On a point of order, Mr. Speaker. In my question I suggested that the Leader of the Opposition had supported Guinness. I should have referred to the leader of the Liberal party.

Business of the House
4.7 pm
Mr. Neil Kinnock: May I ask the Leader of the House to tell us the business for next week?
The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): Yes, Sir. The business for next week will be as follows:
MONDAY 19 JANUARY—Progress on remaining stages of the Local Government Finance Bill.
TUESDAY 20 JANUARY—Opposition Day (5th Allotted Day). There will be a debate on an Opposition motion entitled "The Divided Nation—Failure of the Government's Economic Policies".
Debate on a motion on EC documents relating to broadcasting. Details will be given in the Official Report.
WEDNESDAY 21 JANUARY—Completion of remaining stages of the Local Government Finance Bill.
THURSDAY 22 JANUARY—There will be a debate on the Royal Air Force on a motion for the Adjournment of the House.
FRIDAY 23 JANUARY—Private Members' Bills.
MONDAY 26 JANUARY—Opposition Day (6th Allotted Day). There will be debate on an Opposition motion, the subject for debate to be announced.
[Tuesday 20 January
Relevant European Documents

(a) 8227/84 A Common Market for Broadcasting

(b) 6739/86 Proposed harmonisation of Member States' Legislation affecting broadcasting

Relevant reports of European Legislation Committee

(a) HC 5-iv (1984–85), para 3

(b) HC 21-xxiv (1985–86), para 2]

Mr. Kinnock: Following the most recent exchanges in the House, will the right hon. Gentleman not accept that national trading and industrial interests are not best served by conglomerates gobbling up productive and technologically progressive British companies, and that the matter is a fitting one for reference to the Monopolies and Mergers Commission? It is, in any event, a suitable subject for debate, and I wonder whether the Leader of the House could give an undertaking now that the Government will shortly provide time for consideration of this and related issues?
As the right hon. Gentleman has just announced, the House will give two days next week to the remaining stages of the Local Government Finance Bill, which is obviously very complex, which will provide further dictatorial powers for the Government, breaks promises about rights and safeguards given by previous Ministers and which seeks to set the Secretary of State above the normal process of the law. All that surely justifies proper provision for discussion in Committee, not the indecent and inefficient haste with which the Government are trying to shove the Bill through the House. Will the Leader of the House at least give an undertaking now that further days in future weeks will be given to this Bill so that some semblance of proper consideration can be given to the complex matters within it?
We note that next week time will be made available for a debate on the Royal Air Force. Will the Leader of the House give an indication of when we may expect a debate on the Royal Navy, especially in view of the considerable concern about the implications for defence of the
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continuing reduction of the British merchant fleet which has occasioned much comment in the House and elsewhere?
Does the right hon. Gentleman recall that yesterday the Minister for Social Security and the Disabled rightly advised that in these savage and unprecedented winter conditions people should keep their heating on and keep warm? Is the Leader of the House aware that if they are to take that advice in practice, the poorest people must have their fear of big bills removed? Will he make provision for a Government statement next week to give assurances that they will obtain from the gas and electricity boards a guarantee that poor people, such as pensioners, who keep their heating on in these severe conditions, and who have difficulty in paying their bills for the current quarter, will not be disconnected as a consequence of their difficulty in meeting the cost for weeks like this?
Mr. Nicholas Winterton: The information is already available.
Mr. Kinnock: No, it is not, you ignoramus. I was not referring to you, Mr. Speaker, but to the ignoramus on the Government side.
On a related matter, while we welcome the Government's recently announced support for charities which are helping the homeless, will the Leader of the House now provide time for an urgent debate on the general plight of the homeless, both in the current arctic conditions and in less inclement weather, and on the provision that is necessary to help them?
Finally, on this week's business, since we have the opportunity, there are strong indications that the payroll vote will be called out tomorrow to try to defeat the Bill being put forward by my hon. Friend the Member for Walsall, North (Mr. Winnick), which is intended to provide help for pensioners who are having difficulty in meeting their licence fee. Can the right hon. Gentleman, whom we recognise to be truly a right honourable man, give an undertaking that he will make all efforts to discourage the mobilisation of the Government's official forces against a private Member's Bill?
Mr. David Winnick: Last point first, please.
Mr. Biffen: Of the six points that were put to me by the Leader of the Opposition, I shall happily take the last one first. Of course, I note what he says about tomorrow's voting arrangements. He alerts me of arrangements which I have no doubt may have existed in a complex fashion over many years. I dare say those who study the Crossman diaries can get the most authentic exhibition of their working. What has been said will have been heard, and tomorrow we shall see.
As to the fifth point, the matter concerning the homeless, that can be considered through the usual channels. The right hon. Gentleman also sought a statement on the policy of gas and electricity authorities in respect of disconnection for those who will have incurred extra high payments during recent days. I shall refer his anxiety that there should be a statement on the point.
Of course, I understand his concern that we should have a debate reasonably soon upon the Royal Navy. Perhaps more than any other of the service debates it

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would enable one to consider the nuclear question of British forces. I think I can assure him that a day will be available fairly soon.
Perhaps experience of next week will show us that the Local Government Finance Bill is a wise and constructive piece of action on the part of my right hon. Friend, which will rescue local authorities from what would otherwise have been an embarrassing situation. I hope that my generosity will prove more valid than the right hon. Gentleman's gloom-laden analysis of the future of that legislation. May I say once again that, through the usual channels, we can reconcile any anxieties on that point.
On the matter that he raised initially about monopolies and mergers within British industry and commerce, that will clearly be covered by the debate next Tuesday but I understand that he is anxious about it in a wider context. Again, perhaps that is something that we could consider through the usual channels.
Sir Edward du Cann: Since we are in the season of debates about the armed services of the Crown, will my right hon. Friend consider allocating a day for a discussion about what is often called the fourth arm of our national defence, the Merchant Navy? There is great anxiety in all quarters of the House, from the point of view both of defence and of the economy, about the proportion of it that is owned and registered in the United Kingdom.
Mr. Biffen: My right hon. Friend, with great authority, makes a point on the Merchant Navy. He will have heard the Leader of the Opposition suggest that the debate on the Royal Navy was important precisely because it could embrace those considerations. I shall certainly take that into account.
Mr. David Steel: When does the Leader of the House intend to announce the date of the Budget?
Secondly, will he note that the answers that the Prime Minister gave to me on Tuesday and to my right hon. Friend the Member for Plymouth, Devonport (Dr. Owen) today about empty houses in London being an answer to the problem of the homeless require further investigation by Ministers to establish the legislative and administrative barriers against their being occupied? What is needed from the Government, in addition to the welcome funds, is the release of heated public buildings to deal with the immediate crisis.
Mr. Dennis Skinner: Hear, hear.
Mr. Steel: Perhaps we could start with county hall across the way.
Mr. Biffen: I note the alliance that has already been picked up by the right hon. Gentleman on this point. I am sure that he is now seeking to ditch the alliance, but we all understand his difficulties. Of course, I shall see that the points made by the right hon. Gentleman are related to the relevant Members of the Treasury Bench.
As to the first point, I am not in a position to make an announcement this afternoon but I appreciate that there is concern that the date is known as soon as possible.
Mr. Nicholas Winterton: Ignoramus or not, it is my understanding that gas and electricity boards have already given an assurance that they will not disconnect the supplies to pensioners between November and March.
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Irrespective of the response from the Leader of the Opposition, may I support him in making a call to my right hon. Friend the Leader of the House for a debate at an early date on the takeover mania that has seized the country? My right hon. Friend the Secretary of State for Trade and Industry said that the decision now lay with the shareholders. Bearing in mind that institutions in the City, sadly, are major shareholders, and that their perspective is the short term rather than the long term, the sooner we discuss the best interests of the country and of manufacturing industry, the better.
Mr. Biffen: Of course, I take account of my hon. Friend's anxiety that there should be a debate upon monopolies and mergers. For myself, I would be happy to be called a Tory ignoramus. I would be fearful if I were called a Tory intellectual.
Mr. Doug Hoyle: In regard to the request by my right hon. Friend the Leader of the Opposition, and by the Tory ignoramus, for an early debate on mergers, does the Leader of the House agree that there is even more urgency following the pusillanimous and lamentable display of the Secretary of State for Trade and Industry in relation to Pilkingtons, which is a world leader in its industry? Does he not agree that there is urgency, as we cannot afford to lose firms that are world leaders, because we have not got many of them?
Mr. Biffen: I strongly repudiate the hon. Gentleman's description of my right hon. Friend. I believe that my right hon. Friend set out to the House the framework which governed his decision in a way that was courageous and helpful in the consideration of the argument. As to the wider request for a debate upon monopolies and mergers, I take note of it.
Sir Ian Lloyd: May I first reassure my right hon. Friend that in respect of the House his intellect competes only with his wit? He will know that within the last three or four years the Select Committee on Science and Technology in another place produced a most important report, as a result of which there is now an annual report to Parliament on civil research and development. He will also be aware that within the past two days that same Committee has published a most disturbing report on civil research and development in the United Kingdom in which it called for enlarged understanding and attached importance to the whole question of science and technology at all levels of Government. As one of those levels is undoubtedly this House, may we have an early opportunity to discuss an office of technology assessment? Could not that best be debated in the context of a general debate on the annual report to Parliament?
Mr. Biffen: I will most certainly consider that point.
Mr. Robert Parry: The Leader of the House will have seen early-day motion No. 162.
[That this House congratulates The International Liaison Committee for the Peaceful and Independent Reunification of Korea in organising the International Conference in Pyongyang for the declaration of the Korean peninsula as a nuclear free peace zone; notes that the basing of 40,000 United States troops and the deployment of nuclear missiles on Korean soil is a major obstacle for peace talks in the area; calls for the withdrawal of all American troops and nuclear missiles; and calls upon Her Majesty's

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Government to support the campaign for the de-nuclearisation and peaceful re-unification of the Korean peninsular.]
and early-day motion No. 163:
[That this House deplores the further repression of human rights in South Korea by the arrest of 1,400 students at Konguk University, the invasion of the University Campus by 7,000 members of the military and police forces and the wounding of 70 people, many of them mysteriously; and calls upon Her Majesty's Government to protest at this violation of freedom to the South Korean Government and to seek the release of Mr. Kim Dae Jung, the leader of the democratic opposition.]
As the Government support both these motions in principle and Her Majesty's warships have recently visited South Korea, is that not an example of double standards? Can we have a statement from the Secretary of State for Defence on that issue?
Mr. Biffen: The hon. Gentleman might be prepared to try his hand at Foreign and Commonwealth Office questions next week.
Mr. Patrick McLoughlin: My right hon. Friend will have heard me refer before to early-day motion No. 310, which refers to small dairy farms.
[That this House believes that should a reduction in milk quotas be necessary, the first 200,000 litres of a United Kingdom holding should not be included in any calculations, thus helping to ensure the future of the small family farms which have done so much for the British countryside.]
Can he give some idea when the final decision will be made on the dairy inspection charges? When will we get an opportunity to debate them in the House?
Mr. Biffen: I cannot provide the information that my hon. Friend understandably seeks. However, I shall contact my right hon. Friend the Minister of Agriculture, Fisheries and Food to see whether he can be more forthcoming.
Mrs. Renée Short: In view of the massive concern about the Government's policy on the care of mentally ill and mentally handicapped patients in the community and in view of the fact that the Select Committee on Social Services report was presented a year ago, will he provide time for a debate on the report at the earliest opportunity?
Mr. Biffen: I will certainly consider that matter and how that can be considered in the context of the Government's response to the report and decide whether there is time available for such a debate.
Dr. Alan Glyn: Will my right hon. Friend give priority to the introduction of the resolution on short speeches from Back Benchers because that would be a great benefit? Will he do that at an early opportunity so that it can be quickly promulgated, with or without the amendment?
Mr. Biffen: My hon. Friend will have noted that the motion to provide for that now stands on the Order Paper. It has been amended and I hope that a debate can take place quite soon.
Mr. D. N. Campbell-Savours: Has the Leader of the House read the report of the Select Committee on Members' Interests which deals with the declaraition—or, rather, lack of a declaration—of
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interests by the right hon. Member for South Down (Mr. Powell)? Can we not have a debate on the matter so that the House can take a decision and secure the fullest possible enforcement of the register?
Mr. Biffen: I have only just received a copy of the report. I shall study it and consider how it will stand with the other matters that compete for the attention of the House.
Mr. Tony Marlow: We all know how concerned my right hon. Friend is for the welfare of all right hon. and hon. Members of the House. The House is becoming increasingly concerned about the Leader of the Opposition, not only indulging in a punch-up outside a Pakistani chippy in Ealing, but seeking yesterday to mug my hon. Friend the Minister for Social Security arid the Disabled. I know that my right hon. Friend the Leader of the House is subject to much greater pressures and provocations. Perhaps he has some advice or assistance for the——
Mr. Speaker: Order. Is the hon. Gentleman asking for a debate on this matter?
Mr. Marlow: Perhaps we could have a debate on this matter and my right hon. Friend could then give his views in much greater detail than he can now.
Mr. Biffen: I have a kind of institutional affection for the Leader of the Opposition and he and I are both great admirers of Aneurin Bevan. I remember Aneurin Bevan once describing Hugh Gaitskell as a "desiccated calculating machine." I am sure that the Leader of the Opposition is anxious to persuade us that he is not in that tradition.
Mr. George Foulkes: Will the Leader of the House arrange for the Foreign Secretary to make a statement next week on the outcome of the discussions in the United States of America between British and Argentine officials on the future of the Falklands?
Mr. Biffen: I will most certainly convey the request for such a statement to my right hon. and learned Friend.
Mr. Michael Fallon: In view of the postponement of this week's Opposition debate on the so-called north-south divide, will my right hon. Friend consider whether there should be some minimum period of notice beyond which the subject for an Opposition day ought not to be changed?
Mr. Biffen: Clearly, that is a factor for consideration. However, I thought that we did rather well out of that one.
Mr. Skinner: Is the Leader of the House aware that on Tuesday, during Social Service questions. the Minister's announcement on cold weather payments resulted in a kind of change of legislation? In view of the fact that it may not be as clear each week whether the minus 1·5 deg C point will be reached for the whole week, will it not be necessary—in light of the precedent that has been set by the Minister of State—for a weekly statement to be made by the Government, preferably on a Monday, to tell the House exactly what will happen in respect of weather payments? If not, it means that what happened last week was a farce. It means that legislation has been disrupted for only one occasion when it was uncomfortable for the Prime Minister and the Government.

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Can we have an assurance from the Leader of House that a Minister will make a statement on weather payments, one way or the other, every week so that the House can be clear, and that the precedent will be proceeded with?
Mr. Biffen: No.
Mr. Winnick: Is the Leader of the House aware that the answer that he gave to my right hon. Friend the Leader of the Opposition is bound to confirm the strong impression that Ministers have been told to be present tomorrow to destroy my Bill? Is he further aware that such a manoeuvre is deeply offensive to many pensioners on low incomes who believe that the rights and wrongs of my Bill should be debated? They see no reason why Cabinet Ministers on very large salaries should be told to come here and destroy the measure.
Mr. Biffen: The very nature of the hon. Gentleman's remarks persuades me that there is nothing that I can say that would change his mind.
Mr. John Heddle: In the light of the publication yesterday by the Law Commission about the possibilities of eradicating gazumping, does my right hon. Friend agree that that is an obnoxious practice and that a debate, if not next week, then at the soonest possible opportunity, on the Law Commissioners' report would be greatly welcomed by many first-time buyers?
Mr. Biffen: I understand the importance that my hon. Friend attaches to this topic and that feeling is widely shared in the House. I cannot guarantee that there will be Government time available in the near future for such a debate. Perhaps he might consider trying to raise the matter on the Adjournment.
Mr. Eddie Loyden: In view of the Government's delayed identification or recognition of the north-south divide, and in spite of whatever economic debates take place in the House next week, will the Leader of the House make room for a debate on that question, which has been highlighted again today by the decision taken in the House with regard to Pilkington?
Mr. Biffen: The Leader of the Opposition has underlined the significance of a debate upon merger and monopoly policy more generally and that has been echoed in all parts of the House, including the Conservative Benches. I will add the voice of the hon. Member for Liverpool, Garston (Mr. Loyden), to those voices.
Mr. Peter Bruinvels: As we have all suffered yet another petrol price rise, does my right hon. Friend think that the time is now right to have an urgent debate on what is obviously price collusion and a price cartel operated by the petrol companies? Does he accept that there is a need for the matter to be referred to the Office of Fair Trading? We cannot shop around if the prices that all the petrol companies are charging are the same.
Mr. Biffen: I shall refer the anxieties expressed by my hon. Friend to my right hon. Friend the Secretary of State for Trade and Industry.
Mr. John Evans: Has the Leader of the House seen early-day motion No. 434?
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[That this House urges the Secretary of State for Trade and Industry to refer the BTR bid for Pilkingtons to the Monopolies and Mergers Commission.]
That early-day motion has ben signed by 76 hon. and right hon. Members from all parts of the House. As hon. Members have expressed strong views about the bid, will the Leader of the House make time available in the next fortnight for a debate about the principles involved in the bid so that all hon. Members can make their feelings plain to the shareholders of Pilkington and say what they think that they should do about the BTR bid?
Mr. Biffen: I note what the hon. Gentleman has said and his point is very much on the lines of the question originally put by his right hon. Friend the Leader of the Opposition. I will take account of the depth of feeling that exists on this matter.
Mr. Eric Forth: In view of the number of references to self-regulation, can my right hon. Friend arrange a debate on that subject and, in doing so, will he invite the Leader of the Opposition to lead off the debate, giving examples from his personal capacity for self-regulation, including on the pavement outside Indian restaurants and his recent behaviour in the House?
Mr. Biffen: Some topics have such a durability that I shall be dealing with them as we approach the months of Heaven knows what towards the end of the year. I take note of what my hon. Friend says.
Mr. Greville Janner: Ignoring all the ignorami, can the Leader of the House, at a time when we are considering the plight of the elderly, consider the plight of those men who are not quite so old but who are suffering unnecessarily because they are not permitted voluntarily to retire at the age of 60? Are we to have a debate on this extraordinary anomaly of our system which forces men to remain in jobs when they are desperate to retire, while so many of our constituents are desperate for the jobs that they are occupying?
Mr. Biffen: The hon. and learned Gentleman raises a matter that has great economic and social implications. I cannot guarantee Government time to debate it soon, but the House would enjoy listening to the hon. and learned Gentleman in an Adjournment debate.
Mr. Harry Greenway: Is my right hon. Friend aware of the refusal of the Department of Trade and Industry to refer the takeover of the Ault and Wiborg paint factory in my constituency by Berger, where 220 jobs are involved? Will he accept that it is important to have a debate on competition policy? Failing that, could we have an early statement about the Government's position on competition policy as a result of their current review?
Mr. Biffen: I can understand my hon. Friend's anxiety, particularly in the light of his zealous concern for his constituency interest. I shall see what my right hon. Friend the Secretary of State for Trade and Industry knows of that anxiety.
Mr. Gerald Bermingham: Does the Leader of the House recall that, shortly before Christmas, in a series of business questions, I asked for a debate on the prison system, and he showed some sympathy with my point of view? Since then, we have had yet another riot in a Scottish prison. Have not imprisonment and the terms

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and conditions in prison, both in Scotland and in England and Wales, become a matter of public concern? Should not the House debate the subject soon?
Mr. Biffen: I have sympathy with the hon. Gentleman, which I manifested before Christmas. My sympathy grows, but the prospect of a debate in Government time tends to diminish as we go through this time of the year. I shall refer the matter to my right hon. Friend the Home Secretary.
Mr. Edward Leigh: Given that the official Opposition are being granted their second Supply day debate in seven days, and that we are debating the RAF next week, and bearing in mind my right hon. Friend's well-known charitable disposition, would it not be fair to grant the alliance a Supply day so that we can debate its defence policies and give it an opportunity to climb out of the trough demonstrated in an ITN poll, which shows them winning not a single Conservative seat seven years into a Conservative Government?
Mr. Biffen: I note my hon. Friend's interest that the alliance parties should have more formal political time than at present, and as he is in a position to monitor how effective that is in reducing their impact, I shall be guided by him.
Mr. Richard Holt: My right hon. Friend is aware, as all of us are, that this week bureaucracy has been beaten by ministerial action. Can he bring forward a debate so that we can see how the workings of the DHSS in the applications for mobility and attendance allowances could be eased in the same way, so that those who are ill and sick, whose letters fill our postbags regularly, do not have to wait the average length of time, between nine months and one year, between application, medical examination, adjudication and result?
Mr. Biffen: I suspect that my postbag is not dissimilar from that of my hon. Friend, so I can understand what motivates his point. I shall refer this matter to my right hon. Friend the Secretary of State for Social Services.
Mr. Derek Spencer: Is my right hon. Friend aware that Labour councils are using town halls as political headquarters from which they are already waging the next general election campaign, using ratepayers' money? Can we have another local government Bill quickly to outlaw this practice once and for all?
Mr. Biffen: If all that is implied by my hon. and learned Friend is true, there is not much value for money in the context of current political fortunes, but I shall consider carefully what he says and refer it to the relevant Minister.
Mr. James Couchman: Has my right hon. Friend had an opportunity to read early-day motions Nos. 400 and 414?
[That this House notes that the United States Government intends to impose a punitive 200 per cent. tariff increase to kill Beefeater, Tanquaray and Bombay gin exports to the United States whilst also threatening many hundreds of United Kingdom jobs; notes that the origins of the dispute with the European Community are with grain and other agricultural products; and calls upon all Governments involved to solve this dispute within the framework of the General Agreement on Tariffs and not destroy three famous British export brands which United States citizens wish to purchase.]
[That this House expresses its deep concern at the proposal from the United States administration to impose a 200 per cent. increase in duty on a number of products imported from the European Economic Community; fears in particular that this would have an adverse impact on exports from the United Kingdom of Tanqueray and Beefeater gin; believes that the consequences on price, export levels, and employment would be severe; and urges Her Majesty's Government to do everything in its power to ensure a reconsideration by the United States within the next three weeks.]
These draw attention to the threat posed to the British gin industry by the United States Government, which proposes to put a 200 per cent. increase in tariff on imported gin if the EEC does not make concessions to the United States grain industry. Will my right hon. Friend give time for an urgent debate on this matter, which poses such a serious threat to important British exporters?
Mr. Biffen: The Treasury Bench would immediately be at one with my hon. Friend in being anxious not merely about gin but about the wider issue of a trade war between north America and western Europe. I shall refer my hon. Friend's remarks to my right hon. Friend the Secretary of State for Trade and Industry, but again this could feature as an Adjournment debate.

Orders of the Day

  Coal Industry Bill
  Not amended (in the Standing Committee), considered. Ordered,
  That the Bill be considered in the following order, namely, new Clauses, Clause 1, Schedule 1, Clauses 2 and 3, Schedule 2, Clauses 4 to 10, new Schedules and Schedule 3.—[Mr. David Hunt.]

  Coal Industry Bill
    New Clause 1

      REMOVAL OF MONOPOLY
      '(1) In subsection (1) of section 1 of the Coal Industry Nationalisation Act 1946 there shall be substituted for subparagraph (a) the words "working and getting coal in Great Britain"
      (2) In subsection (2) of that section the words "to the exclusion of any other person" in subparagraph (a) shall be deleted.
      (3) Subsection (1) of section 36 of that Act shall be deleted.
      (4) Subparagraphs (a) and (b) of subsection (2) of that section shall be deleted.'.—[Mr. Fallon.]
      Brought up, and read the First time.
      4.36 pm
      Mr. Michael Fallon: I beg to move, That the clause be read a Second time.
      New clause 1 seeks to remove the monopoly that the National Coal Board enjoys, and has enjoyed for 40 years since the original nationalisation Act of 1946. That Act charged the board with the duty of securing the efficient development of the industry, and 40 years on it should be obvious to everyone that the record is not good. Almost every year of the NCB's existence has seen pits close and miners made redundant. During all that time the NCB has lurched deeper and deeper into debt and become more and more dependent on the goodwill of the Government and the support of the taxpayer. A whole series of Bills such as this have been enacted to transfer more and more of our taxes to the NCB, in return for which the taxpayer has seen little.
      The NCB is not simply financially bankrupt, but is politically and socially bankrupt as well, and the reasons for this deserve some examination. It should be obvious to any student of the coal industry that the board has been living, since 1946, and certainly up to the recent strike, almost in a world of its own, protected from the real world, indifferent to, and oblivious, even contemptous, of the real disciplines of the energy market place. Had it not been so, we would have seen, long before the tragic strike of 1984–85, much better management, much more modern industrial relations and, above all, greater security, certainty for those who work in the industry, the miners, who for 40 years have been denied the opportunity to work in a successful and profitable industry and the chance of any share in that success and in profits.
      The monopoly has insulated the Coal Board from reality. It is the privilege of the board alone to work and extract coal in the United Kingdom, and nobody else shall be allowed to do so other than with its permission, and that is at the heart of the industry's failure. Such a monopoly and privilege is not only wrong in principle, but has been disastrous in practice. There are no such monopolies in other countries. Private mining exists, and
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      other countries do not have to bail out their mining industries or coal boards. During the past 20 or 30 years they have not had to divert resources to finance Hobart House which might otherwise have been spent on roads, schools and hospitals. Indeed, the mining industries of those countries have made a contribution to roads, schools and hospitals, as have our other extractive industries, instead of diverting resources away from them.
      It is high time that the privilege and monopoly of the board was reviewed by the House and, after such a review, removed. I only regret that the Bill promulgates, yet again, the conspiracy between the Department of Energy and Hobart House further to defraud taxpayers of resources which they would wish to see spent on what is most needed, such as roads and hospitals, rather than on keeping uneconomic pits open for social reasons.
      I regret that the Bill does not establish the basis of a new Act to supersede the 1946 Act and lay down the lines on which a restructured industry might be made ready for the 1990s and opened up to fresh opportunities, new investment and, above all, wider ownership.
      The objective of removing the monopoly is threefold. First, it would allow private investment in the industry. It is clear that the industry, as constituted after the strike, will require substantial capital investment for several years. Yesterday's White Paper showed that capital investment of £648 million will be required in the next financial year, and £698 million in the two subsequent years up to the end of 1990.
      Even if the board becomes profitable, it is still, because of its monopoly position, denied access to the private capital markets and is not encouraged even to consider the possibility of joint ventures with private industry.
      We are speaking, not of selling parts of the industry or profitable investments, such as Selby, but of seeking ways to finance the Selbys of the future and to encourage fresh private capital into the industry through joint ventures and partnerships and through the sort of Phoenix schemes that we have devised for the steel industry.
      The second purpose of removing the monopoly is to encourage the existing private opencast sector. That is a small but important sector, employing 1,500 people. My hon. Friends the Members for Erewash (Mr. Rost) and for Tatton (Mr. Hamilton) will, if they catch your eye, Mr. Deputy Speaker, make a powerful case for saying that the limits on this sector, which are at present imposed and controlled, not by the Department of Energy or the county councils on planning grounds, but by itself, should be removed, and that further opencast development should take place, providing cheaper coal and a continuing competitive stimulus to the Coal Board.
      The third aim of removing the monopoly is to encourage the private small mines sector. It is not generally known that small private mines are allowed to flourish in the Coal Board's back yard, provided that they employ not more than 30 men, rather as private agriculture is tolerated in the Soviet Union. There are 160 small mines in Britain and, interestingly, they are in areas of high unemployment. There are 90 small mines in Wales, 29 in the north-east and 20 in Scotland. They produce a formidable output of 800,000 tonnes of coal a year and employ about 2,000 people, but the cardinal point that also applies to the private opencast sector is that it would like to employ more men. It is willing and ready to employ more.
      It is extraordinary that in areas of high unemployment, under a Government who favour the development of small

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      businesses, there is a Coal Board structure which denies other mines and operations the opportunity to employ more men, even when they are already successful.
      It is the view of the small mine owners, given in evidence to the Select Committee on Energy, that employment would expand significantly and considerably if this monopoly restraint were lifted. Anyone who is in any doubt about that should read memorandum 33 to the Select Committee on Energy, which is a damning indictment of the evils of monopoly and an eloquent testimony to the possibilities and opportunities that exist if this great industry is opened up to greater and further competition.
      4.45 pm
      The question is not whether the Opposition will defend this monopoly—obviously they will defend it, just as they defended the monopoly of the National Union of Mineworkers—but whether the Government have the courage and the vision to tackle the monopoly of the Coal Board in the same way as the Bill tackles the monopoly of the NUM.
      Mr. Ian Wrigglesworth: I do not support the provisions of new clause 1, but this is a welcome debate for the House and I am pleased that the hon. Members for Darlington (Mr. Fallon) and for Tatton (Mr. Hamilton) have tabled the new clause.
      The issue needs to be opened up and examined. No one in this House or in the country would want to protect a monopoly unless there was an absolutely overwhelming case for doing so. I am not sure that the case for a monopoly in the coal industry is any longer justified, but a debate on that should take place and we should examine the matter carefully. No doubt when the Act was put on the statute book against the background of private exploitation that had taken place in the preceding decades, the case for a monopoly was overwhelming. In the atmosphere and circumstances of that day we can understand and support what brought the industry into the modern, post-war era.
      The National Coal Board has undoubtedly made a major contribution to Britain's industry and to the communities in which it has operated. However, if we look at the wording of the 1946 Act, which the hon. Member for Darlington and his colleagues seek to amend, we see that it is a product of the 1940s and of the atmosphere and circumstances that existed at that time. The Act states
      "working and getting the coal in Great Britain"
      will be carried out
      "to the exclusion…of any other person…searching and boring for coal in Great Britain"
      shall be carried out
      "to the exclusion of any other person."
      There could not be a more abrupt and crude description of a monopoly than those words.
      The Act then mentions the provision of licences. I wish to dwell on that for a moment, because it appears that putting the power to give licences in the hands of the National Coal Board is quite inappropriate. Oil licences are issued and the royalties are paid to the Government. The appropriate body to issue licences should be the Government, not an operator. That does not mean that the Government should give licences to anyone and everyone. It seems wrong that an operating business should have the royalties and the right to give licences in this way, even if it is a monopoly. The Government may
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      decide to give what will be British Coal a monopoly to operate in this sphere, but it is no longer appropriate that that body should have the power to give licences and take royalties, even if it was appropriate in 1946. Therefore, I see a case for changing the provision to give the Government the right to do that.
      Opposition Members who have had the association with the co-operative movement that I have had will believe that there are forms of ownership other than state ownership which could and, indeed do, make a success of running industrial enterprises in many spheres. Some hon. Members may even want to see co-ownership for organisations carrying out mining activities. During the dispute it was often suggested that some loss-making pits should be given to those who work in them. I was not in favour of that. If we give pits to anybody, let us give profitable pits to those who work in them, so that they can make a success of them. At present the Government do not have the power to do that because they do not issue the licences.
      I can see a case for considering that argument seriously and for transferring the power to give licences and to fix and take royalties to the Government. That would be more consistent with the provision for issuing licences for extracting minerals in other spheres and, certainly, for extracting oil. The country has benefited from that system in other spheres and I see no reason why that provision should not be transferred.
      I hope that the debate will continue. There is no inherent reason why the coal industry should be a monopoly industry. Because of its set-up, it could be argued that every pit should operate as a separate commercial entity. I would not go anything like as far as that, but certainly there could be three state enterprises. If Labour Members do not want the coal industry to go into private ownership, we could have different public sector corporations, and in that way we could have competition and compare the operation and efficiency of different parts of the mining industry.
      We have seen mining succeed in much more difficult spheres, such as in tin. That has been carried out successfully and efficiently and it may be helpful to have that sort of competiton in coal mining.
      Mr. Kevin Barron: The hon. Gentleman spoke of different types of public competition. Is he aware that every colliery in the British coalfield works on the basis of price per tonne at that particular colliery and is in competition with other collieries, and has been since vesting day in 1947?
      Mr. Wrigglesworth: That is a different consideration because it does not take into account the full free-standing commercial set-up of the sort that I am suggesting. Now is not the time to discuss that.
      The coal industry has been in considerable turmoil in recent times. From both the national and industrial point of view now is not the time to embark upon a major change such as is being proposed. That does not mean that the 1946 statute should be set in concrete for ever and a day. Therefore, I welcome the opportunity to widen the debate and hope that it will proceed further and that we shall have many more discussions on this issue.
      Mr. Peter Rost: I support the amendment and the way in which it was proposed, and hope that my

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      hon. Friend the Member for Darlington (Mr. Fallon) will press it to a vote. My only regret is that the debate is necessary.
      It is extraordinary that, after six years of a Government who believe in and have put into practice policies of competition, private enterprise, incentives and lower energy costs, they should have evaded amending the Coal Industry Nationalisation Act 1946, which provides such a stranglehold over what limited private sector mining has been allowed to persist. The Government should and could have removed the worst abuses of the Coal Board's monopoly long ago.
      As my hon. Friend mentioned, there are about 160 small pits, producing about 1 per cent. of the deep-mined coal and employing about 2,000 people. Many are miners' co-operatives. They produced a great deal more in 1960, but since then the restrictions of the statutes have held them back. The Energy Select Committee's memorandum, for which evidence was taken from the Federation of Small Mines of Great Britain, is a most damning indictment of and explanation why the private sector has been so clobbered. For years the FSMGB has argued for the removal of the worst restriction in that Act—that a deep mine in the private sector should be allowed to employ only 30 men.
      I visited one of those small pits in Staffordshire for a day to find out exactly what the problems were. It came to light that, because it was allowed to employ only 30 miners, it could operate only two shifts. It wants to work three shifts to optimise its potential and, indeed, employ more miners. There are plenty of miners looking for jobs since the board has been closing pits, but they cannot be employed in such pits. It is not practicable for the mine to split its 30 work force over three shifts as it would not be viable to operate a shift with only 10 men; at least 15 are needed. The result is that the pit is restricted from increasing its output, providing additional jobs and getting on with it.
      Plenty of other small mines and sites could and would employ 40 or even 100 men. Those jobs could be created, many of them in workers-miners' co-operatives, but the Act prevents that.
      Mr. Alec Woodall: How many miners made redundant by the Coal Board are working at the small mine that the hon. Gentleman visited?
      Mr. Rost: I understand that British coal miners are only too willing to be employed in the mining industry, if they have the opportunity.
      The Government are achieving a massive transformation of the British economy, creating new jobs and encouraging small enterprises, but in this case we are reluctant to set free an industry which could make a bigger contribution to the national economy than it is at present. Those small mines, many of which are co-operatives, wish to reduce their operating costs by operating more sensibly, but they are prevented from doing so by this stupid 1946 monopolies legislation that states that they should be allowed to employ only 30 men.
      There is evidence that whole areas of potential coal mining are being artificially sterilised by that restrictive legislation.
      Mr. William O'Brien: Will the hon. Gentleman give way?
      Mr. Woodall: Will the hon. Gentleman give way?
      Mr. Rost: I hope that Opposition Members will allow me to make my brief speech so that they may then have the opportunity to make theirs.
      There are whole areas with mining potential that the Coal Board does not want because they are too small. They could be developed as small and medium-sized mines if private enterprises were allowed to employ more than 30 men, but they are not. That is restricting the coal industry's economy and job opportunities. How can Government—this Government of all Governments—justify the fact that they have ignored this abuse that should have been dealt with long ago?
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      There is evidence on record of pits which the Coal Board has closed but which the private sector would have liked to have taken over, or existing miners or management would have liked to have taken on. Such pits would have been made viable and economic if the private sector had been given that opportunity, but because it would have involved the employment of more than 30 miners they were not allowed that opportunity.
      Mr. Geoffrey Lofthouse: Where is the evidence of those pits being offered to the miners who would have taken them over and made them profitable? The only time when miners wanted to do that they were refused. I am aware of the small mine that the hon. Gentleman has visited, but can he tell us how many present small mining operations do not employ 30 men even though they are allowed to do so?
      Mr. Rost: The hon. Gentleman has proved my case. They do not employ that number because they are not given the opportunity—[HON. MEMBERS: "Of course they are."] If the hon. Member for Pontefract and Castleford (Mr. Lofthouse) wants evidence from me he may study some of my voluminous files afterwards if he wished to do so.
      There are other restrictions that ought to have been removed long ago and not just restrictions on the numbers employed. I refer to the issue of licences, which the hon. Member for Stockton, South (Mr. Wrigglesworth) referred to so eloquently. The issuing of licences to the private sector is under the patronage of its major monopoly competitor, the Coal Board. The board exercises that patronage in an arbitrary and rather restrictive fashion. It is the judge and jury. What is even worse is that there is no independent right of appeal when there is an abuse or alleged abuse. The private sector wants a licence but can be stopped by the Coal Board. That is unjustifiable and should have been amended long ago.
      A third restrictive factor should have been removed long ago. It is bad enough that the private sector is inhibited and restricted by the original statutes, but on top of that it must pay royalties per tonne, not to the Government or the Department of Energy but to the Coal Board—its major competitor.
      In the deep mine sector that royalty works out as the equivalent of £1 per tonne. That is really quite extraordinary. The Government and not British Coal should be the custodian of coal reserves and all mines should pay a royalty to the Government in the same way as the oil and gas exploration agencies pay a royalty. There should be no restrictions on output or manpower.

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      I believe that if we study the past 40 years it will be clearly seen that there has been an abuse of monopoly and that that has been condoned by Government. I am ashamed to say that Government have failed. They should have put this right long ago.
      In its 1983 report the Monopolies and Mergers Commission said that private operations provided a valuable element of competition and should be encouraged as a means of increasing the efficiency of the NCB. We have moved a little since then but certainly not in the right direction.
      The royalties that the private sector has to pay to the Coal Board out of its profitable operations provide part of the subsidy for the board's loss-making operations. That is quite unacceptable.
      The other area of the private sector coal industry that has been graciously allowed to continue in a modest little way is opencast mining. Private opencast sites provide about 10 per cent. of our opencast coal—about 1·4 million tonnes—and employ about 1,500 people. That is only a fraction of the opencast coal produced. The rest is mined by the Coal Board. Over the years we have had voluminous evidence to suggest that the private sector has the potential to produce more and employ more people if it were allowed to mine the smaller opencast reserves that the Coal Board and the Opencast Executive do not want to know about. Once again, there is a restriction because the licensing power is under the patronage of the Coal Board. The main complaint that the National Association of Licensed Opencast Operators has put to Government over many years is that the monopoly producer, the Coal Board, is also the regulator for the other producers.
      The 1983 report of the Monopolies and Mergers Commission recommended that the limit of production for opencast mines in the private sector—standing at 25,000 tonnes a year—should be raised to at least 100,000 tonnes. We now have some flexibility but it is still up to the Coal Board to decide whether to allow a licence to exceed the 25,000 tonnes. That is a ludicrously small amount. In practice it means that potential opencast mines that the Coal Board does not wish to operate because they are too small but which nevertheless could be developed by the private sector are not tapped because the limit on private sect or production has not been increased to at least 100,000 tonnes a year.
      What is even worse is that private sector opencast mines have to pay a royalty, not to the Government or to the Department of Energy but to the Coal Board. That royalty is about £16 per tonne. The royalty that the private opencast mine industry has to pay to the Coal Board is higher than the Coal Board's profits per tonne from its own opencast operations. That says something about the relative efficiency of the two sectors.
      How can such monopolistic restrictions be justified by the Government? The royalty penalty that the private sector must pay to the Coal Board also limits the number of potential sites that can be exploited. There are many potential sites in the private sector that could be profitable but are not developed because the £16 royalty must be taken into account.
      I ask the Minister to consider how much coal the Coal Board could profitably produce if it did not receive these payments from the private sector or instead had to pay a £16 per tonne royalty on its production. I shall be interested to hear his answer.
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      Private opencast operators are afraid to complain—this this is one of the worst abuses of the monopoly—because they fear that they will be victimised and refused further licences from the board if they do not accept the few crumbs that are given to them under the patronage scheme. The private sector has to take this lying down. There is evidence to support that. That position is quite unacceptable.
      I cannot understand why nothing has been done to amend the Coal Industry Nationalisation Act 1946. That measure has represented a shameful restriction on competition and employment opportunities for miners. It is holding back the production of cheaper coal and preventing a further addition to the creation of wealth in Britain, which our economy desperately needs. I suggest that the time for action is long past.
      Mr. Neil Hamilton: Next year it will be 50 years since a Conservative Government nationalised the coal industry in Britain. I greatly appreciated the spirited defence of capitalism by the hon. Member for Stockton, South (Mr. Wrigglesworth), but, despite what he said, it was a Conservative Government who nationalised this country's coal reserves in the Coal Act 1938, which set up the Coal Commission. Thus, it is 50 years since we began nationalisation, although it is only 40 years since the 1946 Act replaced the Coal Commission with the National Coal Board.
      People are bound to admit that nationalisation has proved to be a failure, even on the basis of the arguments put forward for it at the time. For example, it has manifestly failed to guarantee employment in the industry, as only 15 per cent. of the manpower needed at the time of nationalisation remains. It has also manifestly failed to provide the cheap coal on which industry depends, and imports are kept out only by hole-in-the-corner and backdoor agreements that are forced on the Central Electricity Generating Board. Moreover, nationalisation has failed to protect our market share in the energy industry. By contrast, the consumption of coal as a proportion of the total amount of energy consumed has increased in other parts of the world during the last 10 years.
      Nationalisation has also failed to produce a social return. Billions of pounds have been wasted. Before the strike the figure was £1 billion per annum, and in the 10 years from 1974 to 1984 the figure was £6·5 billion per year. In addition, the taxpayer provides £700 million each year for investment. The NCB has been a great ball and chain round the ankles of British industry because it has kept our power prices at least 10 per cent. higher than they would otherwise have been if the CEGB had been able to buy its coal on a free market.
      Even more obviously, nationalisation has failed to bring about good labour relations. When nationalisation took place, the great hope was that the old battles between the owners and the workers would disappear, but that has not happened. In 1972 and in 1973–74 there were great strikes. Most damagingly of all, there was the Scargill strike of 1984–85. Thus, in the past 10 years in particular, the coal industry's record has been worse than that of the Arabs when it comes to interrupting energy supplies.
      Conservative Members see, and want to see, a great future for our coal industry. I am astonished that Opposition Members do not want to give more support to our proposals, which attempt to secure that advance. The

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      new clause invites my hon. Friend the Minister and my right hon. Friend the Secretary of State, who is the Government's great privatiser, to give the coal industry the benefits that this Government have given in other areas since 1979 through their privatisation programme.
      As I always do in such debates, I shall declare an interest, in that I have a connection with the National Association of Licensed Opencast Operators. However, what I have to say is no different from what I have said in virtually every coal debate since becoming a Member of Parliament and prior to acquiring that interest. Privatisation is successful in other areas, and there is no reason why that success should not be repeated in the coal industry. Unlike the NUM, which pursues solely political goals, Conservative Members seek to pursue social and economic goals that will benefit those who work in the industry as well as the whole nation—taxpayers and consumers alike—through the increased efficiency that privatisation will bring.
      I wholeheartedly support what my hon. Friend the Member for Erewash (Mr. Rost) said about the necessity for liberalisation in advance of privatisation. That could be done very simply. I shall not rehearse those arguments, however, as I put them on Second Reading. Nevertheless, I hope that on this occasion my hon. Friend the Minister will reply to some of the points that I made. The 1983 report of the Monopolies and Mergers Commission made recommendations to liberalise the small private sector regime. I hope that my hon. Friend the Minister will give us some convincing reasons today to show why the Government have not yet found legislative time to make the small changes necessary.
      5.15 pm
      It is vital that Britain should have an efficient coal industry that is capable of providing for our expanding energy needs in an acceptable way. A monopoly is a disadvantage, because in the present structure there is a means of manipulating the price to the consumer. Happily, we now see less of that because, under the direction of my hon. Friend the Minister and my right hon. Friend the Secretary of State, the Government have made immense advances in securing a stable and expanding future for the coal industry, but the pressure would always be on the Government—particularly if we should ever have the misfortune to have a Labour Government—to protect a nationalised industry against the forces of competition and efficiency.
      The economy of scale arguments that are normally advanced for such nationalised arrangements cannot really, in all logic, be applied to this industry. It is unlikely that we need a single monolithic entity to secure economies of scale in coal. Moreover, there are more likely to be difficulties with an industry that is organised on its present basis. I say that because of the complexity of organisation, administration and so on, and all the competing claims that are made, for example, on managers' time in having to lobby Ministers and provide the detailed reports required by the Department of Energy.
      The coal monopoly is not by any means a natural monopoly. Indeed, it is a political monopoly that has been imposed by statute. As the hon. Member for Stockton, South said, there is no reason why we could not have competition within the industry in a variety of different
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      forms, whether by co-operative or joint ventures, individual mines or groups of mines, or whether it be that the industry is broken up by area on a profit-making basis. A huge variety of opportunity is open to us.
      Thus, we could end the conspiracy against consumers and taxpayers that has gone on for the past 40 years. I hope that my hon. Friend the Minister will assist the coal industry in achieving its statutory obligation to secure the efficient development of a coal mining industry in this country. Before 1979 that was not achieved, and it is only in the past two or three years that we have made significant strides towards that.
      I believe that denationalisation and privatisation will bring immense benefits to the industry and to us all, as taxpayers and consumers. Moreover, I can see enormous opportunities for efficiency gains and expansion. Opposition Members often say that they want new coalfields to be developed, but they deny us the means of doing that. The Coal Industry Act 1980 imposed an injunction on the NCB to break even by 1983–84. There is now an injunction for the industry to break even by the end of this decade. I hope that the date will not be postponed yet again.
      The necessity for Government to act is brought about only by the artificial statutory regime in which the industry has to operate. If it was in private hands, it would be profitable and would operate in the interests of the whole country. The cost of electricity to consumers would be greatly reduced, as Lord Marshall said during the strike, possibly by 10 or 15 per cent., if we had the freedom to purchase coal in the cheapest market.
      There is no reason why Britain should not have the cheapest market. Efficiency is not the enemy of the miner, as can be seen from the increase in earnings of those still in the industry. The tragic number of job losses in recent years would not have occurred if the industry had become more efficient earlier on. There would be a bigger market for coal in Britain if it were not for the likes of Mr. Scargill, who has frightened industrialists off coal, because they feared that their supplies could be interrupted at crucial moments. They were frightened off because they did not want to build up stocks as an insurance against the possibility of a strike and incur the cost of keeping coal idle as a result. The cost fell on the whole nation, because mothballed oil-fired stations had to be kept in operation against the possibility of a strike. The huge cost of the oil burn during the coal strike would not have been necessary were it not for the backward-looking, dinosaur attitudes of Opposition Members and their supporters.
      According to Opposition Members, the coal strike of 1984–85 started because of the failure of the Coal Board to observe the guidelines for pit closures. If there were the opportunity for private market investors to put their money into pits, there would be no need for colliery review procedures. The market would be the review procedure. If a pit was inherently profitable, people would put money into it and keep it in operation. That would involve a more hard-headed decision than the bureaucratic self-serving one that the industry takes at the moment.
      Mr. Stanley Orme: The hon. Gentleman has said it all.
      Mr. Hamilton: That is certainly true. All of us have said it all. The right hon. Gentleman has said it all before as well. I shall continue to say it all until the right hon.

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      Gentleman agrees. I suggest that he addresses his remarks to my hon. Friend the Under-Secretary of State. The sooner the right hon. Gentleman agrees with me, the sooner I shall keep quiet.
      There are many benefits of privatisation. Technical progress would become more rapid and relevant to different scales of operation, as we have seen in the North sea, where advances in the development of big oilfields have accompanied the ability to exploit smaller, previously inaccessible deposits. We would thereby achieve a greater security of supply with competitive suppliers. Above all, we would depoliticise the economic decisions that we have been obliged to take. There would be pressure to reduce costs, keep down prices and raise efficiency.
      The Government's role would then be the proper role of the Government, not that of a Department interfering in the day-to-day management of the industry. The Government's role would be to maintain competition and to internalise the external costs of mining which otherwise would fall upon the community, and that would be wholly admirable. I counsel my hon. Friend to take to heart the words of my right hon. Friend the Secretary of State for Transport, who was the architect of the privatisation programme during the last two Parliaments. In a recent publication he is reported as saying:
      "It is already clear to me who mainly prospers through privatisation. The shareholders of the companies we have sold prosper. the employees prosper, and most of all the customers and the whole Nation prosper. That is why privatisation in the United Kingdom has been such a success and why the programme will continue until all state-owned commercial industries are returned to where they belong—to the private sector."
      I emphasise the last few words,
      "all state-owned commercial industries."
      I hope that this legislation clearly presages the return of the coal industry to the private sector, so that it and we can prosper together.
      The Parliamentary Under-Secretary of State for Energy (Mr. David Hunt): I am grateful to the hon. Member for Darlington (Mr. Fallon) for raising this issue, which is important to his party. His colleagues are known for their enthusiasm in this matter. They will not be surprised at my response.
      I must, however, dissociate myself from the comments of my hon. Friend about an alleged conspiracy between my Department and Hobart House to defraud the electorate. Perhaps he went a little over the top.
      The hon. Member for Stockton, South raised some important points concerning the power to fix royalties. My hon. Friend the Member for Erewash (Mr. Rost), who has always robustly argued his case, made some important points about the private sector in the coal industry, both the licensed opencast sector, to which much reference is made, and the private deep mine sector, to which perhaps insufficient reference is made.
      My hon. Friend the Member for Tatton (Mr. Hamilton) clearly laid out the social and economic goals which he considers will benefit all those in the industry, as well as the taxpayer and the country. I am advised—I do not rest on this argument—that the new clause would not have the effect that some hon. Members seek because, under schedule 1 to the 1946 legislation, the residue of coal will remain with British Coal.
      My substantive response is that there is scope for the private and public sectors effectively to work together. The opencast sector is a prime example of how best that can
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      be done. In 1983 the Monopolies and Mergers Commission reported private sector output of 700,000 tonnes a year. By 1985–86 output had risen to 1·4 million tonnes, which is about 10 per cent. of the UK's annual opencast output.
      My hon. Friend the Member for Erewash rightly mentioned the subject of royalties, which is a matter for negotiation between private sector operators and what will be British Coal. He mentioned the figure of £16 a tonne. He will know that many companies do not pay that level of royalty.
      My hon. Friend will be aware also, I hope, that in 1981 my predecessor, the Under-Secretary of State, as a result of meetings with the National Coal Board and the National Association of Licensed Opencast Operators, laid down five clear guidelines. The so-called five principles of 1981, which were agreed between the National Coal Board and private operators, and endorsed by the Government, have allowed arrangements to work well. The fourth guideline states that the NCB agreed
      "to set royalties at levels which will permit efficiently-managed operators to develop their business profitably."
      That is an important guideline for the private sector.
      The other guidelines, under which the NCB agreed to license opencast sites with up to 35,000 tonnes of workable reserves to resume the practice of considering a second licence for adjacent sites, bringing the total tonnage of contiguous reserves under licence to around 50,000 tonnes, to exercise the greatest possible flexibility on the maximum size of licensed deep mines, to phase out the practice of requiring many opencast licensees to deliver their coal to the board by offering all new licences free from any delivery requirements, and to reduce royalties for new licences in any case in which accounting evidence was provided which demonstrated that profit expectations would otherwise be cut to unreasonably low levels, are important and have worked well.
      This is not an area in which the Government have closed their minds. It is important to ensure that the relationship between the private and public sectors and between private opencast mines and private deep mines is encouraged. I do not think that my hon. Friend the Member for Erewash, despite his usual efficiency, has visited all the 160 privately operated deep mines or the 75 private licensed opencast sites. This private sector already has an important share in the coal industry. I repeat that the private sector is an important part of our great coal industry.
      The Bill is the wrong vehicle for a lengthy and major debate on the issues that have been raised, although I recognise their importance. My hon. Friends will know that on many occasions I have said that there are no plans for privatisation. Equally, my right hon. Friend the Secretary of State and I have said that we shall support any move to give the work force—men and management in the industry—a more direct stake in their industry. With this Bill we recognise that, over the past two years, there has been a massive process of restructuring. It has resulted in a stable, viable industry that is capable of offering secure, long-term employment and of contributing positive benefits to the nation.
      There will always be restructuring in an extractive industry such as coal mining. The important news for the industry in this legislation is that the major restructuring

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      of recent years is drawing to a close with the end of the redundant mineworkers' pension scheme at the end of March this year.
      The legislation is designed to assist those final steps by which management can achieve its goal and, for the first time, run a great industry independent of handouts from the taxpayer. Our coal industry is the only one in Europe that has that possibility within its grasp, and it is the only coal industry in Europe that is improving productivity. Surely that is justification, if any were needed, of the path that management, with Government support, has taken and the response that it has had from the men.
      In those circumstances, I ask my hon. Friend the Member for Darlington (Mr. Fallon) to withdraw the new clause.
      5.30 pm
      Mr. Fallon: With the leave of the House——
      Mr. Deputy Speaker (Mr. Harold Walker): Order. The hon. Gentleman does not need the leave of the House.
      Mr. Fallon: We have had a useful debate, perhaps more useful than I could have anticipated. If I understood the hon. Member for Stockton, South (Mr. Wrigglesworth) correctly, alliance Members suggest that they no longer support the monopoly in principle and that they favour transferring the licensing power from the board to the Secretary of State. I pay tribute to the hon. Gentleman because he is well ahead of his alliance colleagues in recognising the importance of markets and competition. His understanding that state regulation and state licensing do not necessarily also mean state provision should be better known on Teesside and also in Stockton, South.
      I welcome also the contributions of my hon. Friends the Members for Erewash (Mr. Rost) and for Tatton (Mr. Hamilton), who have supported my case—one with great eloquence and the other at great length—and who made the case against monopoly. Nobody could seriously defend the monopoly that was enshrined in the Coal Industry Nationalisation Act 1946.
      The reply of my hon. Friend the Under-Secretary of State did not surprise me as much as it disappointed me. I hope that one thing will result from the debate—perhaps my hon. Friend the Minister can help me in this—and that is that news of the debate can be leaked back to his Department. Perhaps it could be conveyed, not only to his Department, but by some agency to Hobart House so that those who preserve the monopoly and operate its restrictions can be made a little more aware of the spread of competition and the removal of monopoly that has taken place, not only in other industries, but in other Departments in Whitehall.
      I make it clear that in the new clause we were not proposing the privatisation of the coal industry. We were not even suggesting——
      Mr. Deputy Speaker: Order. The hon. Gentleman must not seek to elaborate on the speech that he made when he proposed the new clause to the House.
      Mr. Fallon: We were not proposing privatisation or the transfer of ownership of existing assets. However, we suggested that the industry should be opened up to change, private investment, joint ventures and to the competition that could be provided by an expanding independent sector.
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      It is clear from the debate that that discussion has only just begun and that it will continue. For that reason, I do not wish to press the new clause to a Division, despite much encouragement to do so, because it is clear that, if leave to withdraw the new clause is refused and it is negatived, Opposition Members will be shown to be the defenders of monopoly, privilege and restrictive practice. I beg to ask leave to withdraw the new clause.
      Motion and clause by leave, withdrawn.

    Clause 5

      COAL INDUSTRY TRUSTS
      Amendment made: No. 4, in page 5, line 20, at end insert—
      '(5A) Where any functions relating to a trust are exercisable by more than one body of trustees, for the purposes of subsection (1)(b) above the Charity Commissioners may disregard or have regard only to the members of one of those bodies.'.—[Mr. David Hunt.]

    Clause 6

      OTHER SOCIAL WELFARE BODIES
      Amendment made: No. 5, in page 6, line 45, at end insert—
      '(6A) The fact that a provision relating to the constitution of a body has been added or amended by an order under this section shall not preclude its subsequent alteration or deletion in accordance with any relevant powers.'.—[Mr. David Hunt.]
      5.33 pm
      The Secretary of State for Energy (Mr. Peter Walker): I beg to move, That the Bill be now read the Third time.
      I have watched the progress of the Bill with interest, because when it was announced in the Gracious Speech that the Bill would proceed there appeared to be considerable hostility to it and cries of how passionately the measure would be opposed. On Second Reading we saw the decision to introduce a major amendment. As has been pointed out, it was a strange amendment, because it totally ignored most of the main clauses. Then we were told that great changes would take place in Committee. Therefore, fearing a long Committee stage with strenuous debates, I asked my hon. Friend the Parliamentary Under-Secretary of State if he would conduct the proceedings with his usual skill and patience. He did so, but we discovered that we had to deal with only seven minor amendments and one new clause.
      Looking at the Bill in its completed stages, intact from any hostility that Opposition Members have expressed, it is interesting to recognise the positive and good things that the Bill carries into operation.
      Clause 1, which was strangely opposed by the Opposition, changes the name of the organisation to British Coal. That request was made by the industry because it considered that the marketing of its product would be substantially improved by having such a title, which would appeal to people because they would know that they would be buying a product that was made in this country. That would be clearly understood and would be far better for advertising purposes than the more complicated title of the National Coal Board.
      However, that request by the marketing side of the industry was, strangely, totally opposed by Opposition Members who considered that it was an extraordinary plot

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      to privatise the industry. If in the near future we were to privatise the industry, we could easily and speedily give the organisation any name that we wish. However, the title of British Coal is welcomed by the marketing side of the coal industry.
      Of course, we hope that the marketing side will be extremely successful in the years to come. It is involved in a wide range of new products and technologies, especially in the domestic market. I wish that marketing drive every success. Those concerned will appreciate that my hon. Friends are sympathetic to their application that the title of British Coal should be granted, and will be appalled by the manner in which the clause has been attacked by Opposition Members.
      Clauses 2, 3 and 4 of the Bill set out a series of financial arrangements. Once again, nobody can but claim that the financial arrangements put into place by the Bill are exceedingly beneficial to the industry as a whole, and that they express very firmly the Government's confidence in the important place that the industry will have in the future.
      No other coal industry in Western Europe can look forward in the next three years to £2 billion of capital investment. While the coal industries in the rest of Western Europe have declined, especially in countries that have recently been under Socialist control, in this country the industry will enjoy £2 billion of further capital investment to improve its productivity and the way in which it can produce coal at a price that can compete with other energies and fuels in the market.
      The financial background is generous in carrying on the provisions for those who have become voluntarily redundant during a period of major rationalisation of the industry. Anybody with an interest in the industry must consider the degree of rationalisation that has taken place. After the considerable change in manpower that has occurred, present levels of coal production are close to what they were before rationalisation, but are achieved at far lower cost and with far higher productivity.
      Mr. A. J. Beith: I hope that the Secretary of State will not forget that that rationalisation, which includes the closure of Whittle colliery in my constituency—which was accepted on geological grounds by the National Union of Mineworkers—involves major social problems for the areas concerned, and that he cannot leave solely to other Ministers, who decide matters such as development area status, the responsibility for the consequences in those areas.
      Mr. Walker: I am sure that the hon. Gentleman will know that some of the financial provisions that we are making in the Bill have enabled financial support to be given to the enterprise company that has done such remarkable work in bringing jobs to coal mining areas where pits have had to close. It is a new concept. A total of 168,000 men were made redundant during periods of Labour Government and there was no such enterprise company in operation. On present trends, that enterprise company, with substantial financing, will produce, I hope, about 25,000 new jobs in mining areas. Those jobs will be far better than working in a declining mine and they may well produce expansion in the future.
      The clauses of the Bill that were significant and important in every sense were clauses 5, 6 and 7. They gave the Union of Democratic Mineworkers, among others, its
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      proper right to representation on the various social funds and pension funds to which it has every entitlement. Conservative Members expressed their surprise at the negative approach taken by the Labour party when we discussed that on Second Reading. I referred to it as the "Scargill silence". I must say that the silence continued in Committee. In debate after debate on clauses 5, 6 and 7 the Opposition Members sat silent. When they were given an opportunity to vote and express their view, they decided on a policy of abstention on this vital issue. Therefore, there are tens of thousands of mineworkers who know that the Labour party had no wish for the men to have proper representation on the administration of the pension funds concerned.
      The Labour party wishes to continue the ban on the Union of Democratic Mineworkers. That ban was first imposed by the Labour party, which refused to have any political affiliation with the union, and it was also imposed by the Trades Union Congress, which refused to allow it to be part of the TUC. Through the Bill's various stages, we have seen the Labour party's determination not to recognise a perfectly democratic union. In fact, it was the UDM that maintained the old tradition of the National Union of Mineworkers to have a democratic vote before taking industrial action.
      I know that later today the finances of the NUM will be disclosed. That will reveal the considerable financial problems it faces. It will reveal that its own statements, made at its own meetings, show the great difficulty being experienced in meeting its obligations. There will be a suggestion that the union will need substantially increased contributions if it is to maintain solvency. The NUM's leadership did much damage to the mining industry by not giving proper democratic rights to the UDM. It was the NUM's actions that resulted in the creation of the UDM. I hope that miners throughout the country will recognise that the "Scargill silence" of the Labour party is bad not only for that party but for the NUM.
      The Bill provides appropriate financial arrangements. It helps the Coal Board to provide better marketing activities and gives a democratic right to a democratic union. I believe that the coal industry and the country will judge it to be a fine piece of legislation and will be shocked at the Labour party's attitude to it.
      5.44 pm
      Mr. Orme: Since April 1985 there have been more than 55,000 redundancies in the coal industry, 59 pits have closed or merged, and colliery capacity has fallen to 90 million tonnes of deep-mined coal. Unmployment in coalfield communities has gone sky-high, and 14 of the 22 travel-to-work areas that saw the highest rise in unemployment between January 1985 and April 1986 were coal communities. The Bill is the Government's response to that devastation. It is a pathetic and unsatisfactory response. It will do nothing for the industry. It will not improve morale or restore good industrial relations.
      On Second Reading and in Committee, we argued that this is a pit closure Bill. We maintain that that is the case. The Bill sets the pre-conditions for a further round of pit closures and redundancies. The financial provisions are totally inadequate to provide a secure and expanding future for the industry. Indeed, they are mainly to cover redundancy, redeployment and pit closures.
      The Government have no vision of an expanding British economy. Therefore, they have no vision of

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      increased electricity demand. They are sanguine about the run-down of a basic British industry that provides the fuel for manufacturing, hospitals, schools, heating homes and electricity generation. The Government's complacency, so vividly shown in yesterday's debate, is once again reflected in the financial provisions of this Bill. We have received no satisfactory answer to our anxiety that the provisions will not even cover those categories for which it is designed. We remain unconvinced that the Bill does not pave the way for the privatisation of the industry. We have just had an interesting debate on that point. Privatisation is certainly popular among Government Back Benchers, as we have witnessed, and Ministers' denials have become increasingly vague, not least the reply that we have just heard from the Under-Secretary of State. Already, ancillaries such as Associated Heat Services have been sold off in what can be only a trimming exercise. The accelerated sale of NCB houses at auctions at the Kensington Hilton has not provided the NCB with a vast amount of revenue and it has caused great distress and confusion in many coalfield communities. I understand that even today many of my hon. Friends have been to see the NCB about those outrageous sales.
      The Bill will do nothing to restore morale in the industry. As the Secretary of State pointed out, in Committee we did not argue or vote against clauses 5, 6 and 7. However, we did argue that they would not solve the very real industrial relations problems throughout British coalfields. To rectify that, we introduced a new clause to cover every pit in the coalfields. The Secretary of State did not even mention that clause in his speech. We believe that trade unions have a right to recognition and that they must have the right to represent and negotiate on behalf of their members. That is currently being denied to minorities in British coalfields.
      In Committee, the Minister seemed to be under the impression that members of minority unions were not discriminated against and, in some cases, victimised when carrying out legitimate union activity. In Committee, I gave some specific examples of that. I should like to put on record a letter that has been sent to me by Mr. Richardson of the Nottinghamshire area NUM. It is a copy of a letter that was sent by Mr. A. A. Searle of the NCB, who is the manager of the Bolsover pit. The letter states:
      "Dear Mr. Wright, I refer to your interview in my office on Wednesday 17th December 1986 and write to confirm the remarks I made at that time. You were observed in the Colliery Canteen on the evening of Tuesday, 16th December, 1986 between 9.30 pm and 10 pm talking to the night shift. I warned you that you must not repeat this exercise at any time in the future and any recurrence will lead to your instant and summary dismissal. You must not, either during or outside of your shift, conduct NUM business on British Coal premises whilst the union is not recognised at the Bolsover colliery."
      Mr. Dennis Skinner: It is worth recording that at the Bolsover colliery the NUM has the majority membership. The incident mentioned in the letter followed the one in which Geoffrey Poulter, the branch secretary of the NUM at Bolsover, was sacked only a week or 10 days before the letter went to the branch delegate, Stephen Wright, who is one of my constituents. This smacks of a big brother attitude by the management at Bolsover, and it is being supported by those Ministers who are happy to
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      talk about minorities, freedom and justice, provided it is for one particular section. They are quite happy to see the thought police of the Coal Board operating against the NUM.
      Mr. Deputy Speaker (Mr. Harold Walker): Order. The hon. Member should be brief.
      Mr. Orme: My hon. Friend the Member for Bolsover (Mr. Skinner) makes the case for our new clause. We put it to the Under-Secretary in Committee that that sort of victimisation and discrimination was taking place, and he denied it. Here is an instance of trade union members being denied basic human rights within the mining industry at present.
      Mr. Martin M. Brandon-Bravo: I appreciate that some words and phrases are unparliamentary. However, will the right hon. Gentleman dispel the impression that we had upstairs and say something downstairs, if he is allowed to use the phrase, about the Union of Democratic Mineworkers?
      Mr. Orme: We said that we were moving the new clause, and that if the Government accepted it we would accept without qualification clauses 5, 6 and 7. This clause—this is the important point—will give minority rights not only to the NUM in Nottingham or elsewhere, but also to UDM members in other parts of the British coalfields. Examples such as the one I have just given led us to introduce our new clause in Committee—a new clause that would ensure fair play for all unions. The Government's response proved that that is the last thing that they are interested in.
      We are opposed to the terms that the Government have put forward. They would not accept a democratically drawn up new clause. It is upon that basis that we are right in our opposition and right in the case that we have put for the British coal industry. I therefore urge my hon. Friends to vote against the Bill tonight.
      5.52 pm
      Mr. Andy Stewart: I support the Third Reading of the Bill. This 18th Coal Industry Bill will have greater significance in terms of future security and prosperity for the industry and its employees than all its predecessors. I include the original nationalisation Bill of 1946. That Bill heralded so much promise for the country and its miners. In hindsight, we know that it failed on both counts. The coal barons were replaced by a highly motivated political trade union, more interested in political domination than in its duty to ensure its members' continuing prosperity.
      This Bill, by comparison, brings the coal industry ultimately into the 20th century and sets the course to make it one of Britain's most successful industries in the 21st century. British coal is a sunrise industry with reserves that will last almost 300 years. The usage of coal will gradually change from mainly power station burning and domestic use to replacing our oil and gas requirements, whose known reserves will last no more than 25 years. To replace today's oil and gas requirements from coal, we will need to mine 180 million tonnes. Our European partners have few workable coal reserves left, so there is also an export potential. Derivatives from coal will be used for the raw stock of many of our chemical manufacturers. At the moment, 25 derivatives are used, and in time this number must rise.

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      During the passage of this Bill, like its predecessors, we heard more of the history of the coal industry than its future from the Opposition. Let the past be a guide to the future, but do not let the Opposition's political dogma cloud the prospects of the exciting future of this great industry.
      What some people describe as "blighted reserves" will in time be gasified underground for direct use, leaving the more accessible seams to be brought to the surface. This Bill will guarantee not only the miners' prosperity, but also their security of employment for years to come. Accepting the scientific evidence available, no miner need fear the competition from nuclear energy. There will be no conflict, because coal will be required for other purposes, and in the not too distant future will be too valuable to contemplate burning. That is why I am confident of the long-term prospects for the coal industry. That, coupled with the other clauses in this Bill, will give the Union of Democratic Mineworkers its rightful place in representing its members' interests socially and industrially.
      In my maiden speech I said that I was proud to be the Member of Parliament for Sherwood, Britain's largest mining constituency. That is nothing compared with how I feel towards my mining constituents and their families today. Their fight for survival during the year-long dispute, and the birth of trade union democracy, was won through their determination and guts for survival, despite the collusion between the Labour party and the NUM for their destruction. The UDM is here to stay. Its leaders' professionalism and adherence to democratic principles will ensure that, and in time it will be the only union representing mineworkers, because the ramshackle organisation in Sheffield called the NUM is bereft of principles and money.
      I can speak only for my own constituents. I do not speak for the miners of Ashfield, because the hon. Member for Ashfield (Mr. Haynes) is in the Chamber. Nevertheless, I hope that I speak on this occasion for all the other Nottinghamshire miners in thanking my right hon. Friend the Secretary of State and the Under-Secretary, my hon. Friend the Member for Wirral, West (Mr. Hunt), for bringing this Bill forward, guaranteeing the rights and freedoms of the UDM, and securing the future of British Coal. So far the Labour party has not recognised the UDM. Do you intend to do so today? I shall give way——
      Mr. Deputy Speaker: Order. The hon. Gentleman must not bring me into these matters. He is bringing the UDM into these matters a little too much. On Third Reading we must confine ourselves to what is in the Bill. I do not find any reference to that organisation in the Bill.
      Mr. Stewart: I apologise, Mr. Deputy Speaker. Does the Labour party intend to recognise the UDM?
      Mr. Deputy Speaker: Order. The hon. Gentleman will neither give way nor find it necessary to invite anyone to give way because the Bill is not about the matters to which he is addressing himself.
      Mr. Stewart: Will the Opposition recognise both trade unions working in the mining industry?
      I remind the House and the country that there is no substitute for coal, but coal can be substituted for any other fossil fuel and its derivitives. That is the long-term guarantee of security for Britain's greatest industry.
      Mr. Deputy Speaker: We have about 50 minutes left and about 15 right hon. and hon. Members are seeking to catch my eye. The difficulties will be obvious.
      5.59 pm
      Mr. Wrigglesworth: May I begin by picking up two points made by the Secretary of State? First, he referred to the opposition to the Bill from the Opposition Benches. For the record, I think that he will concede that that is not entirely accurate. The Opposition on the Benches occupied by my right hon. and hon. Friends have given the Bill fullhearted support from Second Reading through Committee and will do so again on Third Reading.
      Secondly, the Secretary of State referred to NCB (Enterprise) Ltd. I do not want to pursue the point at any length, but he will recall that my right hon. Friend the Member for Plymouth, Devonport (Dr. Owen), myself and others pressed him to establish that body for a long time before he eventually got round to doing so. We are delighted that it is succeeding in the way that it is, and we are delighted that he has increased its funding so that it can carry out the excellent work that it is doing in the areas where collieries have been closed. I only wish that even more could be done.
      We support the Bill because it continues to give the financial support which the industry rightly deserves and needs.
      Mr. Jack Thompson: Will the hon. Gentleman give way?
      Mr. Wrigglesworth: I must not give way to the hon. Gentleman, otherwise I shall prevent others from speaking.
      The Bill gives much needed financial support to the industry and therefore deserves the support of the House. It also deserves support for the rights which it gives to the UDM to be represented in the trusts and welfare bodies from which it has been excluded by the NUM. Despite the efforts that have been made and the negotiations that have taken place, the union has not been able to obtain the places which any reasonable person would accept were its right. Substantial bodies of workers are represented by the new union and they have every right to be represented on the bodies that are there to serve the people in the mining industry.
      Mr. Thompson: Will the hon. Gentleman give way?
      Mr. Wrigglesworth: I shall give way, but it will prevent other hon. Members from speaking.
      Mr. Thompson: I am grateful to the hon. Gentleman for giving way. When the hon. Gentleman says "we", is he describing the Social Democratic party or the alliance?
      Mr. Wrigglesworth: I am speaking for the alliance in this debate as, indeed, in other debates.
      If the Labour party has the true interests of the mining industry at heart, it will reject the dog-in-the-manger attitude which the NUM's leadership has adopted since the strike ended. The sooner the divisions that exist within the mining industry are overcome, the better for everyone. They will not be overcome—they would take a long time to be overcome in any case—unless there is an attempt by those within bodies, not only in the mining industry but outside, to help to bring about reconciliation.
      If the Labour party continues to give Canute-like support to Mr. Scargill and the NUM's leadership, there

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      will never be any move in the direction of reconciliation between the warring factions in the mining industry. It is in no one's interests that that battle should continue for ever and a day. It will be impossible to overcome the fierce antagonisms and feelings that arose from the violence and intimidation that occurred during the dispute. I have condemned many times the lack of criticism during the dispute from the Labour Benches of the violence and intimidation that took place at that time.
      But life goes on, and if we are to have a successful industry and prosperity in the mining areas, it is in everyone's interests, and in the national interest, that attempts should be made to achieve reconciliation. That will not be achieved by excluding the UDM and hoping that it will go away. It will not. It will continue to represent, courageously and well, its members, not only in the Nottinghamshire area, but in many other areas. Undoubtedly, if it continues with the guts and determination that it has shown since it started, it will go from strength to strength. The sooner that the Labour party acknowledges that fact, the sooner there will be a hope of some reconciliation and change in the future.
      I hope that the more sensible Members of the House will acknowledge that view. My hope may be in vain. Indeed, if the Bill's proceedings have been anything to go by, I certainly do hope in vain. The Labour party sat on its hands and said nothing on the relevant clauses in Committee. As has been said, it is disgraceful that Labour Members made no comment whatever.
      Finally, I want to pay, as will all hon. Members, a great tribute to the management and workers, both in the NUM and the UDM, in the mining industry for the way in which they have worked and succeeded since the strike ended. I hope that the Bill will enable them to build on the success that they have achieved—productivity levels that have never been achieved in the coal mining industry before. I hope that the Bill will help to bring about even further success in the industry and that is why we shall give it our full support tonight.
      6.5 pm
      Mr. Richard Ottaway: I start by expressing my thanks to the Government for fulfilling their pledges in introducing the Bill. Those thanks come not just from me, but from the miners of Nottinghamshire, whose pensions, welfare and social rights are so much affected by the Bill, and also from the residents of Nottingham who experienced many difficult months during the miners' strike.
      The need for the Bill came about when the UDM split from the NUM in 1985 because it could not accept the new rule book which it had supported for 40 years before the split. It was simply because the NUM became undemocratic. The NUM had ignored the role of the ballot box during the miners' strike and had changed the majority which was needed for a strike from 55 per cent. to 50 per cent.
      The changes in the rule book also removed autonomy from certain areas. A disciplinary rule was brought in and in Durham 400 men were expelled, many of whom were members of the UDM. All those changes were introduced in one block vote at the NUM conference in 1985. As a
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      result of that, from which came the need to introduce the Bill, the UDM decided to split from the NUM in the summer of 1985——
      Mr. Deputy Speaker: Order. I have been tolerant and flexible about the debate so far, but the hon. Gentleman is really going too far. None of those matters is germane on Third Reading.
      Mr. Ottaway: I am only trying to demonstrate why we have the Bill and why I am grateful to the Government for introducing it.
      Mr. Deputy Speaker: Order. That might have been appropriate on Second Reading, but not on Third Reading. We have the Bill and it has been debated by the House.
      Mr. Ottaway: The truth of the matter is that the TUC is not prepared to recognise all the miners' unions in Britain——
      Mr. Deputy Speaker: Order. I have been tolerant and we have had a wide debate, but, as far as I can see, there is no reference in the Bill to the TUC. It really is going too far to start bringing it in. I hope that the hon. Gentleman will deal more closely with what is in the Bill.
      Mr. Ottaway: I am merely trying to refer to the situation that resulted in the need for the Bill.
      Mr. Deputy Speaker: Order. I am trying to tell the hon. Gentleman that he is departing from what is permissible on Third Reading. If he persists in doing so, I shall have no option but to instruct him to resume his seat.
      Mr. Ottaway: I shall abide by your wishes, Mr. Deputy Speaker.
      The Opposition opposed the Bill on Second Reading and that is an affront to democracy and the mining unions in the Nottinghamshire area. The Opposition have sought to deny the UDM's participation in the pension, social and welfare funds of the coal industry.
      The only contribution made by the Opposition in this debate about the other union in the industry was an amendment in Committee which the right hon. Member for Salford, East (Mr. Orme) spoke about on Third Reading. He said that he was prepared to barter across the Dispatch Box certain rights affecting representation and contributions in the various British Coal committees. For him to say that is a disgrace, and the people of Nottinghamshire will find it a disgrace. The only objective of the new clause was to give rights to the NUM in the Nottinghamshire coalfield.
      Apart from 30 seconds from the right hon. Member for Salford, East on Second Reading, we have had complete silence from the Opposition. That silence has spread from the House. Just the other day I received a challenge from my opposition, the Labour party candidate in the forthcoming general election. He challenged me to a debate on any issue that I cared to name. I said to him, "There is a brave lad." I challenged him to a debate on the future of the Union of Democratic Mineworkers. I found that the disease of lockjaw which has hit the Opposition in this debate had spread to Nottinghamshire, because since I accepted his challenge I have not heard a word from him. This demonstrates the Labour party's hostility to the people of Nottinghamshire and the UDM.
      This is almost certainly a general election year, and I do not deny that I will have a difficult time in that election

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      because mine is a marginal seat. Whatever the outcome of that election, as I campaign in the streets in Nottinghamshire and in Bulwell in the weeks leading up to the election at least I will be able to hold my head high and say that, unlike the Labour party, I was prepared to stand up for the people of Nottinghamshire. This is a sorry episode for the Labour party and I can assure Opposition Members that their actions will not be forgotten in Nottinghamshire.
      6.11 pm
      Mr. Skinner: I am pleased that my hon. Friends raised the matter of minorities as it affects the NUM in the Nottinghamshire coalfield. I should like to put on record the fact that the NUM has been making a great impact on that coalfield and the minority is getting larger all the time. To that extent I have no doubt that they will find some favour with the Minister.
      I am worried that this Bill could be regarded as a prelude to privatisation and has nothing to do with the cries that we have heard in this debate. We heard cries from Conservative Members, some of whom have now left the Chamber, when debating new clause 1 and the Minister found himself in something of a quandary in responding to the catcalls. If the Government are reelected, the National Coal Board, or British Coal, as it is soon to be called, would be a prime object for privatisation.
      The Tory Government are hell bent on destroying British Coal and on attempting to destroy the NUM in the process. The Government have been engaged in that exercise for the past two or three years and are now getting the industry ready for the spivs and racketeers.—[Interruption]—most of whom are represented on the Government Benches. The matter of privatisation has already been touched upon in the debate.
      Mr. Deputy Speaker: Order. Privatisation was debated in the course of our earlier proceedings when there was an amendment before the House. At that time it might have been appropriate for the hon. Gentleman to make the speech that he is seeking to make now. However, we are now on Third Reading.
      Mr. Skinner: We are on Third Reading of a Bill containing sums of money to enable British Coal to operate. Many of us think that that sum is insufficient to meet the needs of the industry on a long-term basis. If that is our argument, it follows that that shortage of money can lead to a change in ownership of British Coal. That could mean privatisation and we say strongly that we are against that. The road that I have just trod was long and tortuous, but it has brought me to anti-privatisation. If the smart Alecs on the Government Benches had been sharp enough to understand that, they too might have been able to prepare better speeches than the ones from which they read.
      Mr. Andy Stewart: What is the hon. Gentleman doing?
      Mr. Skinner: I am not reading, I have had to sort out my speech on my feet and that is not always easy.
      We are worried about the future of the industry and this Bill does nothing for its long-term future. It is all about doing something for today, for the moment, to try to get this Tory Government over another hump for another 12 months. We have argued throughout the passage of the
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      Bill and before that our aim for the industry from which we come is to see our 300-year supply of coal developed in a way that maximises its potential energy.
      Mr. Ottaway: On a point of order. Is there any difference between what the hon. Member for Bolsover (Mr. Skinner) is saying and what I was saying? You told me, Mr. Deputy Speaker, that I was out of order.
      Mr. Deputy Speaker: The hon. Gentleman must not challenge my ruling in that way. I am listening carefully to the hon. Member for Bolsover (Mr. Skinner) and I am glad that his latter remarks were a little nearer to the substance of what is proper in this debate than were his earlier remarks.
      Mr. Skinner: If we argue that in the Bill insufficient money is being allocated to the mining industry, then we can argue that from a long-term point of view the money is insufficient to meet its needs. We argue that there should be no redundancies and that mines should be kept open. Some of us would argue that some of the mines that were closed ought to be reopened. A future Labour Government will exploit those 300 years of reserves and produce the money that is lacking in this Bill in order to ensure that more people are employed.
      With a view to dealing with the after effects of this Bill and other Bills, this morning some of us went to see British Coal about the scandalous way in which it is selling off houses in which many miners with more than 40 years experience of working underground live. [Interruption.] Housing is mentioned in the Bill. At that meeting the British Coal representatives were as hard and stony faced as Conservative Members. They do not care about the housing of those miners and are not worried about the pensioners. Their only concern is to sell off the houses to the spivs and the Rachmanites and the racketeers who sit like leeches on the periphery of the coalfields waiting to make a big fat killing. Many such people are represented by Government hon. Members. We want to put that right and when we get back to government we will change that part of the Bill because it is obnoxious to those who have served the industry so well.
      The Bill provides insufficient money to meet the needs of widows and others who still do not receive concessionary coal, even though some pits were closed before 1968. I notice that the hon. Member for Amber Valley (Mr. Oppenheim) is missing. I have raised this matter time and time again. The Bill does not provide compensation for those people, and the Opposition want to have the opportunity to put that right.
      6.20 pm
      Mr. Spencer Batiste: During the passage of the Bill many of my colleagues and I have been puzzled about the Labour party's ambivalent attitude towards those provisions that would lead to fairness in representation on the superannuation schemes and in the industry's institutions. I refer in particular to the provisions of clause 7.
      I suspected during the passage of the Bill, particularly in Committee, that we were hearing not about the real reasons for opposition but about a cover-up being perpetrated by the leadership of the National Union of Mineworkers. My fears have been fully vindicated. A document has come into my possession that arouses real concern for all those pensioners in the industry who have

      453
      been represented thus far by the NUM in the industry's superannuation schemes. Is my hon. Friend the Minister satisfied that clause 7 will protect adequately the rights of individuals and that it will ensure that unsuitable people are not appointed as representatives on the boards of superannuation schemes?
      I refer to the financial report that was presented to the finance and general purposes sub-committee of the NUM on 13 November 1986. Its implications are stunning. As time is short, I shall refer only to short extracts, but I shall make a full copy of the document available as soon as the debate is over. It reveals that the NUM has a deficit of nearly £1·85 million and that it has no resources with which to meet it. The report is relevant to clause 7, because it reveals that the NUM is about to default on its superannuation schemes. These passages must be brought to the attention of the House so that my hon. Friends——
      Mr. Deputy Speaker: Order. It is difficult to see how the internal finances of the NUM are relevant to the provisions of the Bill.
      Mr. Batiste: This is a matter of the gravest importance, Mr. Deputy Speaker. From the brief extracts that I wish to read to the House, it is quite clear that the NUM is about to default on its superannuation payments and that it has no money with which to make them.
      Mr. Deputy Speaker: Order. The hon. Gentleman must tell me why that is relevant to the provisions of the Bill.
      Mr. Batiste: I shall, Mr. Deputy Speaker. Clause 7(4) of the Bill says:
      "References in this section to participation by an organisation include participation by any person as a nominee or on behalf of the organisation."
      There may be grave cause for investigation of the way in which certain persons have exercised their judgment in relation to the NUM's superannuation scheme. I am not sure that there are sufficient powers in the Bill to prevent such unsuitable persons from being nominated by the trade union as representatives on the boards of the industry's superannuation schemes.
      Mr. Deputy Speaker: Order. These are factors that the Secretary of State will undoubtedly take into account when exercising the discretion that the Bill confers upon him, but I am not sure that it is appropriate for the House to go into the internal affairs of another organisation.
      Mr. Batiste: I raise the matter now, Mr. Deputy Speaker, because I am not at all clear, having read the clause, whether the Secretary of State has such a discretion. I seek that assurance by raising these very important matters, albeit very briefly. One brief passage will give you clear evidence of my concern and why I think that the matter is relevant. It says:
      "The National Union has an obligation to pay approximately £450,000 per year to the Officials and Staff Superannuation Scheme."
      Unless action is taken, the superannuation scheme could be in very serious difficulties. The report states specifically that the union's ability to operate is threatened and that it is not in a position to meet its continuing obligations. The union is in arrears to the superannuation scheme and is unable to fulfil its financial commitments to its retiring officials and staff.
      Mr. Deputy Speaker: Order. I am not clear whether the references that the hon. Gentleman is seeking to draw to the attention of the House are references to the internal superannuation scheme of that organisation or whether they refer to the scheme that is dealt with in the Bill. I suspect that they are different schemes.
      Mr. Batiste: In that respect you may be right, Mr. Deputy Speaker. There is an internal scheme, but there may be people who are involved with both and the rights of those people will be intertwined.
      Mr. Deputy Speaker: Order. The House is discussing a Bill that refers to a statutory scheme for the industry. If the hon. Gentleman is seeking to draw the attention of the House to a scheme that relates entirely to the staff and members of the NUM, that has nothing to do with the House and it is out of order.
      Mr. Batiste: I was not seeking to do any such thing. However, I am trying to draw the attention of the House to the fact that the Bill must provide some interpretation of what is meant by clause 7(4). I repeat that it says:
      "References in this section to participation by an organisation include participation by any person as a nominee or on behalf of the organisation."
      If a person under the general law of trust is unfit as a trustee to run one superannuation scheme, there has to be a power——
      Mr. Deputy Speaker: Order. The hon. Gentleman is seeking to show that there are internal developments within an organisation that is entitled to nominate people under the Bill that make that organisation unsuitable. That is not an argument to which the House can listen on Third Reading. I hope that the hon. Gentleman will get away from that point.
      Mr. Batiste: Without in any way wanting to challenge that point, Mr. Deputy Speaker, which I fully accept, the fact remains that as it stands the Bill contains powers to permit the appointment to the boards of the industry's superannuation schemes of people who, by virtue of the points that I should like to raise, if I were permitted to do so, would be manifestly unsuitable. Can any organisation nominate whomsoever it wishes, irrespective of investigation——
      Mr. Barron: On a point of order, Mr. Deputy Speaker. May I pass to you a copy of the notes on clauses that the hon. Member for Elmet (Mr. Batiste) was given at the Committee's first sitting? Clause 7 says nothing about who will represent the organisations.
      Mr. Deputy Speaker: The hon. Gentleman is not being as helpful as he wished to be. However; the hon. Member for Elmet (Mr. Batiste) is straining the patience of the House. He is certainly straining mine and he is abusing the limits of the conventions of debate on Third Reading. I hope that we can get away from the internal affairs of an organisation and discuss the Bill. If not, I hope that the hon. Gentleman will resume his seat, because in the very limited time that is available a large number of hon. Members wish to make a contribution to the debate.
      Mr. Batiste: I shall not intrude upon the patience of the House, because I shall release this document and will not quote further from it. I have already made the points that I wished to raise.
      Mr. Brandon-Bravo: Will my hon. Friend give way?
      Mr. Batiste: I hope that my hon. Friend will forgive me for not doing so, as time is short.
      I hope that my hon. Friend the Minister will take on hoard the point that it is necessary to have the power to prevent unsuitable people from being appointed by organisations to these boards. I am not sure whether the Bill contains that power. I seek guidance on that point.
      Mr. Brandon-Bravo: I appreciate that my hon. Friend is not referring to a commercial organisation, but, if he were, would he be using the word "bankrupt" in this context?
      Mr. Deputy Speaker: Order. Again I must remind the House that we are discussing the Third Reading of the Coal Industry Bill. This is an inappropriate time to discuss matters that may or may not have been included in the Bill and that are not relevant to the Third Reading debate. I hope that the hon. Member for Elmet will either deal with relevant Third Reading points or allow other hon. Members who are anxious to take part in the debate to do so.
      Mr. Batiste: Mr. Deputy Speaker, I will intrude no further on your patience in this matter, save to make what is a perfectly germane and proper point in the context of the debate on Third Reading. One of the most important things that any person who has worked hard throughout his life is concerned with is that, in the management of his pension fund or superannuation scheme, he will be properly represented. That lies at the core of what we have been proposing in clause 7 of this Bill.
      I am seriously concerned that this Bill—and it is on this that I seek advice—may not have sufficient powers within it to ensure that the Secretary of State can reject nominees who are, by any reckoning, unsuitable on the basis of the way in which they have managed other superannuation schemes. That concerns the constituents of hon. Members on both sides of the House and it is a matter to which I shall return in great detail as this document is made public later.
      6.30 pm
      Mr. Peter Hardy: I shall be both brief and relevant. That will be quite refreshing after the speeches that we have heard from hon. Members on the Government side today. From the beginning of this afternoon's consideration of this Bill, we have heard dogma and attempts to fuel division. Remarkably little attention has been paid to the coal industry about which we are supposed to be concerned. The hon. Member for Sherwood (Mr. Stewart) seeks to extract himself from criticism, but when he looks back at his speech he will see that he has sought to capitalise on division rather than pursue a course which would serve the future of the industry and promote healing within the industry. I accept that the hon. Member did refer to the important markets which must exist for coal, and it is that to which I wish to draw attention.
      The Minister will accept that the answer that he gave me today to a question that I put down because of the Third Reading of this Bill is a cause for enormous concern, a concern which I hope will be shared by every hon. Member on the Government side. After the serious consideration that the Government are supposed to have given to the Bill I get this answer to the question that I asked today.
      I asked the Minister to say
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      "from which countries coal has been imported during the past 12 months; and what information he has in each case as to the extent to which the United Kingdom price of that coal properly reflects the cost of the production, marketing and distribution."
      The answer is that we have imported coal in the past 12 months not only from Australia and the United States but from South Africa, Poland, Canada, West Germany——
      Mr. David Ashby: What has this got to do with the Bill?
      Mr. Hardy: It has a lot to do with the Bill, as will demonstrate. Coal also has come from the Netherlands, Belgium and Colombia.
      The Minister will argue that the Government have put money into the industry. The Minister will argue that the Government have provided money for the industry to meet national need. Yet we are paying not the slightest attention to whether our industry is exposed to unfair competition because of dumping by other countries. These countries include South Africa, which allows mining activities that are grossly unsafe. I hope that in the next few days the Minister will look at the example set by West Germany, where the Government and the mining trade unions appear to be moving towards concerted action to respond to the grossly unsafe activity at collieries in South Africa. It would be rather nice if the European response was one of unity.
      A few months ago—and this is very relevant to the Third Reading because it follows a point made by the hon. Member for Sherwood—the Minister said that Sleipner gas should not be landed in Britain because we had discovered more gas offshore and could maintain our self-sufficiency. The other reason was that the Government did not want to be in a position of having to pay good money to foreign countries to import gas. Although some Government Members believe, and have said several times recently, that we can easily import cheap coal over the next 20 or 30 years, I suggest that it would be as foolish for us to get into a position of dependence on imported coal as it would have been to get into a similar position with imported gas. We have a great opportunity to build on the reserves to which the hon. Gentleman referred. If we are to do so, the Government must go further and recognise the logic of the enormous increases in productivity that have been achieved in recent months. If those increases in productivity are to have any logic, if the Government are to pursue any degree of consistency, they should make it clear to the country that our future is based on British coal rather than on developing the level of imports which some hon. Members on the Government Benches might like to see.
      6.34 pm
      Mr. Richard Alexander: I intervene in the debate briefly and, I hope, relevantly to underline one point, which is that the Bill recognises that there is now more than one major union in the mining industry. It is significant that it took the Government and this Bill to enable this to be done. It is significant that the Opposition have denied that it should be done. I tried to intervene earlier during the speech of the right hon. Member for Salford, East (Mr. Orme) to ask him his intentions as regards the union which we are not allowed to mention because it is not in the Bill. I asked whether he and his

      457
      party believed that it had a right to democratic decisions on matters in that industry. I have so far heard nothing from the Opposition to indicate that they are supportive of people's democratic rights in the industry.
      Listening to the barracking of some of the Opposition Members, who suggested that my hon. Friends were spivs or city slickers or somehow in the pay of dishonourable people, I found it a little rich, coming as it did largely from hon. Members who themselves are paid and sponsored by the National Union of Mineworkers. They did not declare their interests when they spoke for the mining industry, and I find it a bit thick that they should unjustifiably accuse my hon. Friends of being dishonourable in the things that they said and wanted to do.
      If Opposition Members believe in democracy, I hope that their spokesmen will say so in the few moments left for the consideration of this Bill. The Bill is designed to give greater democracy. We on the Government side believe in democracy. We have yet to hear anyone on the Opposition Benches say that this is what the Bill is about and that they support it.
      6.37 pm
      Mr. Geoffrey Lofthouse: This Bill is purely a stage in preparation for the privatisation of the mining industry. At no time during the Second Reading or in Committee or today has anyone flatly denied that. I am pleased to see the Secretary of State take his place again. Earlier on he seemed very pleased about the achievements of the mining industry in recent months. If people want to crow about 59 pit closures, about 55,000 redundancies since the miners' strike, about wiping out mining communities, they can do so, but I do not believe that these can be called successes. Whatever they are, the Government have created on this run-up to privatisation, on the run-up to this Bill, unemployment and misery in these communities.
      The Secretary of State referred to the enterprise scheme. I do not wish to knock that scheme and I never have done, but it is a fact that in my own area, which has suffered severely through the pit closure programme, I have been able to indentify only two jobs created by the Coal Board's enterprise scheme. After my speech during the Second Reading of the Bill, a high-ranking official of the Coal Board took it on himself to write to the local press and question my figures. It was obvious that he had not read my speech. Would I investigate with that senior official? Because, he said, his figures differed from mine: he thought that there were four jobs, 100 per cent. more.
      The Government have continued to pile on the agony. To enable the industry to break even by 1988 they are savagely attacking the housing stock of the Coal Board. I went recently to the Kensington Hilton when houses were being auctioned. What I saw was repulsive. There were racketeers and property speculators; you name it, they were there bidding. I recognise that the Government have done all this to the mining people in an attempt to run down the industry rapidly so as to prepare for privatisation.
      Mr. Barron: On the housing stock, I understand that the Coal Board has temporarily suspended sales. This morning I received a letter sent on behalf of a Mr. T. Ward, 21 Coronation Avenue, Kiveton Park, whose house
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      was sold late last year. It has now been resold to someone in London. Utter confusion has been created because people do not know from one month to the next who their landlord is or what protection they have.
      Mr. Lofthouse: That is the case. One lady, the wife of a disabled miner, attempted to purchase her property but could not get a mortgage before the closing date. She then went to the auction to try to buy the house. She was unsuccessful because a speculator or racketeer bought the whole block. Within two days someone was knocking at her door, offering her the house for a profit of over 30 per cent. That is what the Government have done to the mining community, the miners and their families.
      The hon. Member for Sherwood (Mr. Stewart) talked about 300 years of reserves. If the Government continue to rape the mining industry, the reserves will be down to 50 years.
      6.42 pm
      Mr. David Ashby: I welcome the Bill, which will be particularly welcome in south Derbyshire and to the UDM at Rawdon and Ellistown collieries. The most amazing thing has happened. We have heard a great deal of opposition to the Bill on Second Reading, on Report and now. It is said that the reason for the opposition is that the Bill is a prelude to the privatisation of the Coal Board. Of course, the true reason for the opposition has been exposed today. A rearguard action is being fought by Opposition Members with close affiliations to an association which we now know to be bankrupt. We know that people in that organisation have been acting in breach of trust and that the organisation should be the subject of an inquiry. The funding of the NUM should be inquired into. The Labour party has tried desperately to keep the NUM as the sole and supreme union in the mining industry and to exclude the UDM. That is why it has opposed the Bill.
      The local leader of the UDM in my constituency, someone by the name of Horace Sankey, has been trying to do a deal with the local Labour party which has said that it is not opposed to the Bill nor to the UDM. I have said several times that the miners are being misled by the local UDM leader because he has close affiliations with the Labour party. The true picture is that the Labour party is opposed——
      Mr. Deputy Speaker: Order. The hon. Member has heard me chide other hon. Members for straying beyond the limits of a proper debate on Third Reading. There is nothing in the Bill about the Labour party. I hope that the hon. Gentleman will get back to what is in the Bill.
      Mr. Ashby: There is opposition to the Bill from the major Opposition party, which I believe is known as the Labour party. People in my constituency should know the reason for that opposition. The opposition relates entirely to the fact that the Labour party knows the precarious state that the NUM is in and is trying to maintain a bankrupt union.
      We heard the hon. Member for Bolsover (Mr. Skinner) refer to my hon. Friend the Member for Amber Valley (Mr. Oppenheim) who has been fighting a long action in support of the extension of the concessionary coal allowance, an action on which I have supported him. Not for the first time have we heard the hon. Member for Bolsover try to claim for himself a campaign in which he

      459
      had no interest. Time and time again I have challenged him to say that he was in the least bit interested in concessionary coal allowances. Belatedly, realising his position, he has started to claim for himself something that he has no right to claim. I notice that he is not in the Chamber now. He made his allegation and disappeared, which is typical of him.
      Mr. Walter Harrison: On a point of order, Mr. Deputy Speaker. Is it not right that, when an hon. Member intends to attack another hon. Member, he gives notification to that hon. Member that he will do so?
      Mr. Deputy Speaker: That is a convention of the House.
      Mr. Ashby: The hon. Member for Bolsover came in, made a number of ridiculous allegations, used the foulest language in respect of hon. Members and then disappeared. He does not deserve to be told of any proposed attack.
      Mr. Phillip Oppenheim: Does my hon. Friend agree that to be railed at and insulted in such a way by the hon. Member for Bolsover (Mr. Skinner) is probably the surest sign that a Member is an honourable Member and is doing his duty properly?
      Mr. Ashby: I agree with that observation.
      I end my speech as I began. I welcome the Bill which introduces a large measure of democracy and which will give the UDM a voice in areas where it has a right to be heard. Indeed, it is essential that the UDM should have a voice in those areas because of the revelations we have heard about the NUM.
      6.48 pm
      Mr. Alexander Eadie: On Second Reading we warned the House of the great difficulty we would have in Committee of trying to make a job of the Bill because of its political and electioneering aspects. We should not be cynical about it. In Committee we did the best job we could.
      When the Secretary of State opened the debate he referred to clause 1. It was right that the House should have some discussion as to why the name of the National Coal Board has been changed to British Coal. We understand that there was no consultation about that. However, we understood from clause 1 that the Government were changing the name and that was that. We therefore had a debate on the subject.
      We had a very long debate in Committee about housing. The importance of that topic has been borne out by the scandals that have been revealed about the sales of National Coal Board housing. Indeed, my hon. Friend the Member for Bassetlaw (Mr. Ashton) raised the subject in an Adjournment debate in which he exposed the scandal about the sale of National Coal Board houses. We had a worthwhile discussion in Committee on that subject.
      We have heard little today about the financial provisions in the Bill. Some hon. Members will know that when a money resolution is moved in the House it is very difficult to discuss the financial provisions. Nevertheless, we did as well as we could in Committee on that topic. We tried to warn that even within the NCB there is doubt as to whether the financial provisions in the Bill will be adequate to deal with the problems in the coal industry.
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      The Opposition must place a marker on that. We have grave doubts as to whether the financial provisions in the Bill will meet the problems in the industry.
      The Secretary of State referred to clauses 5, 6 and 7 and how the Opposition sat on their hands and allowed Government Members to articulate their case about giving rights to minority unions. We had good reason to do that. My right hon. Friend the Member for Salford, East (Mr. Orme) made it perfectly clear that we would cover that point in a new clause. We would test whether Conservative Members were democrats and libertarians like the hon. Member for Stockton, South (Mr. Wrigglesworth), who represents the alliance. We proved that they were not libertarians. Under the new clause, all registered trade unions in the mining industry would have rights to bargaining, conciliation and consultation. We received a strange reply from the Minister. He said that it was a Scargill type of amendment despite the fact that my right hon. Friend the Member for Salford, East said that the amendment was based on the convention of the International Labour Organisation. It stretches the imagination to claim that Mr. Scargill drafted the ILO convention. We won the argument and the debate in Committee. I invite any hon. Member to read the reports of the Committee stage. We wiped the floor with the Government. We emerged as the libertarians and democrats because we wanted rights for all, not rights for one particular section.
      The Government are impaled to some extent on a Bill that has great political content. It is an electioneering Bill and a pit closure Bill. It will do nothing for the mining industry, and I invite my hon. and right hon. Friends to join me in the Lobby to vote against it.
      6.53 pm
      Mr. David Hunt: The hon. Member for Midlothian (Mr. Eadie) has made many contributions in coal industry debates over the years. However, on reflection, he will consider the contribution he has just made as his worst. He in no way addressed the important issues of the industry. In many ways his spech followed that of his right hon. Friend the Member for Salford, East (Mr. Orme), who went over the top almost in his first sentence when he described the financial provisions of the Bill as a pathetic response. If he deems as pathetic a Bill that provides at least £1·1 billion for the future of the coal industry, but, much more important, a three-year investment programme of £2 billion following on from an investment programme under this Government of £5 billion, his use of the English language is to be greatly deplored.
      We should not just deplore the way in which the right hon. Member for Salford, East used the English language. His lack of use of the English language in Committee is also to be deplored. He and his hon. Friends sat silent on the crucial clauses 5, 6 and 7. That must attract the condemnation of this House.
      In relation to the financial provisions, I can tell my hon. Friends the Members for Sherwood (Mr. Stewart), Nottingham, North (Mr. Ottaway), Elmet (Mr. Batiste), Newark (Mr. Alexander) and Leicestershire, North-West (Mr. Ashby) that they are correct to recognise that morale and productivity in this great industry are high as the men look to the future with greater confidence than ever before. It is far better for the future of this great industry for us to look to the future now and grasp the opportunities.

      461
      The past few years have not been easy for the industry. At least now the possibility exists for the first time of ending the long-standing preoccupation with pit closures and manpower rundown and of replacing that with optimism for the future. I readily grasp that opportunity and, under my right hon. Friend the Secretary of State, I am proud to be the Minister responsible for coal with such exciting opportunities lying ahead.
      However, I want to return to the points made by the hon. Member for Stockton, South (Mr. Wrigglesworth) which were ignored by so many Opposition Members—the provisions for fair representation in the industry. As my hon. Friends have explained, unlike the Labour party and like on this occasion the alliance, the Government are committed to the basic principles of democracy that led to the birth of the UDM during those dark days of the miners' dispute. The successful efforts of the working miners to sustain the coal industry——
      Mr. Barron: Sponsored by the NUM.
      Mr. Hunt: The hon. Gentleman should not ignore this point. I know who is sponsored by the NUM. Let him not follow their line on this point.
      Mr. Barron rose——
      Mr. Hunt: The hon. Gentleman should recognise that the successful efforts of the working miners to sustain the coal industry through that evil and unnecessary strike must never be forgotten. I am afraid that Opposition Members too readily pretend that the efforts of the working miners, now represented through the UDM, will be forgotten. They hope that the UDM will go away. As other hon. Members have stressed, the UDM will not go away.
      Mr. Barron: Will the Minister give way?
      Mr. Hunt: I will give way in a moment.
      My hon. Friend the Member for Elmet has revealed the scandalous state of affairs that will need urgent examination, in particular, by the miners in the industry. The report to which my hon. Friend referred—and of which the hon. Member for Midlothian is aware—states that those dominated by Scargill have done tremendous damage not only to their industry but also to their union. It is important now to preserve and enhance democracy in the mining industry. Sadly, in Committee, the Labour party was silent and running scared of Scargill. I described Labour Members politely as parliamentary puppets on the Scargill string. By opposing the Bill on a three-line Whip on Second Reading, and by failing to support the vital clauses on fair representation, the Labour party has reneged on the basic principles of union democracy on which the trade union movement was founded.
      There is only one explanation for the silence of Labour Members—subservience to Scargill and opposition to the UDM. Of course there is a great future for all those working in the coal industry. However, it must be a fair future—fair for the industry and for its employees.
      Question put, That the Bill be now read the Third time:—
      The House divided: Ayes 220, Noes 126.

      Division No. 54]

      [6.59 pm

      AYES

      Aitken, Jonathan

      Goodhart, Sir Philip

      Alexander, Richard

      Goodlad, Alastair

      Alison, Rt Hon Michael

      Gow, Ian

      Alton, David

      Grant, Sir Anthony

      Amess, David

      Gregory, Conal

      Ancram, Michael

      Griffiths, Peter (Portsm'th N)

      Ashby, David

      Ground, Patrick

      Ashdown, Paddy

      Gummer, Rt Hon John S

      Atkins, Robert (South Ribble)

      Hamilton, Hon A. (Epsom)

      Atkinson, David (B'm'th E)

      Hamilton, Neil (Tatton)

      Baker, Nicholas (Dorset N)

      Hampson, Dr Keith

      Baldry, Tony

      Hanley, Jeremy

      Batiste, Spencer

      Hannam, John

      Beith, A. J.

      Hargreaves, Kenneth

      Bellingham, Henry

      Harris, David

      Benyon, William

      Haselhurst, Alan

      Best, Keith

      Hawksley, Warren

      Biffen, Rt Hon John

      Hayhoe, Rt Hon Sir Barney

      Biggs-Davison, Sir John

      Hayward, Robert

      Blackburn, John

      Heddle, John

      Boscawen, Hon Robert

      Henderson, Barry

      Bottomley, Peter

      Hickmet, Richard

      Bottomley, Mrs Virginia

      Higgins, Rt Hon Terence L.

      Bowden, Gerald (Dulwich)

      Hind, Kenneth

      Braine, Rt Hon Sir Bernard

      Hirst, Michael

      Brandon-Bravo, Martin

      Hogg, Hon Douglas (Gr'th'm)

      Bright, Graham

      Holt, Richard

      Brinton, Tim

      Howard, Michael

      Brooke, Hon Peter

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

      Browne, John

      Howarth, Gerald (Cannock)

      Bruinvels, Peter

      Howell, Ralph (Norfolk, N)

      Buck, Sir Antony

      Hubbard-Miles, Peter

      Burt, Alistair

      Hunt, David (Wirral W)

      Butcher, John

      Hunter, Andrew

      Butterfill, John

      Jackson, Robert

      Carlisle, John (Luton N)

      Johnson Smith, Sir Geoffrey

      Carlisle, Kenneth (Lincoln)

      Jones, Gwilym (Cardiff N)

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

      Jones, Robert (Herts W)

      Carttiss, Michael

      Jopling, Rt Hon Michael

      Chalker, Mrs Lynda

      Kennedy, Charles

      Chapman, Sydney

      Kershaw, Sir Anthony

      Chope, Christopher

      Key, Robert

      Clark, Dr Michael (Rochford)

      King, Roger (B'ham N'field)

      Clarke, Rt Hon K. (Rushcliffe)

      Knight, Greg (Derby N)

      Colvin, Michael

      Lang, Ian

      Coombs, Simon

      Lawler, Geoffrey

      Cope, John

      Lawrence, Ivan

      Cormack, Patrick

      Lee, John (Pendle)

      Corrie, John

      Lennox-Boyd, Hon Mark

      Couchman, James

      Lightbown, David

      Currie, Mrs Edwina

      Lilley, Peter

      Dorrell, Stephen

      Lloyd, Sir Ian (Havant)

      Douglas-Hamilton, Lord J.

      Lloyd, Peter (Fareham)

      Dover, Den

      Lord, Michael

      Durant, Tony

      Lyell, Nicholas

      Edwards, Rt Hon N. (P'broke)

      McCurley, Mrs Anna

      Eggar, Tim

      MacGregor, Rt Hon John

      Emery, Sir Peter

      MacKay, Andrew (Berkshire)

      Evennett, David

      MacKay, John (Argyll & Bute)

      Eyre, Sir Reginald

      Maclean, David John

      Fallon, Michael

      Maclennan, Robert

      Farr, Sir John

      McQuarrie, Albert

      Favell, Anthony

      Major, John

      Finsberg, Sir Geoffrey

      Malone, Gerald

      Fletcher, Sir Alexander

      Marland, Paul

      Forman, Nigel

      Marshall, Michael (Arundel)

      Forsyth, Michael (Stirling)

      Meadowcroft, Michael

      Forth, Eric

      Merchant, Piers

      Fowler, Rt Hon Norman

      Mitchell, David (Hants NW)

      Fox, Sir Marcus

      Montgomery, Sir Fergus

      Franks, Cecil

      Moore, Rt Hon John

      Freeman, Roger

      Neale, Gerrard

      Fry, Peter

      Neubert, Michael

      Galley, Roy

      Nicholls, Patrick

      Gardiner, George (Reigate)

      Onslow, Cranley

      Gardner, Sir Edward (Fylde)

      Oppenheim, Phillip

      Garel-Jones, Tristan

      Osborn, Sir John

      Glyn, Dr Alan

      Ottaway, Richard

      463

      Owen, Rt Hon Dr David

      Stradling Thomas, Sir John

      Pattie, Rt Hon Geoffrey

      Sumberg, David

      Pollock, Alexander

      Tapsell, Sir Peter

      Portillo, Michael

      Taylor, Teddy (S'end E)

      Powley, John

      Temple-Morris, Peter

      Raffan, Keith

      Thomas, Rt Hon Peter

      Rhys Williams, Sir Brandon

      Thompson, Donald (Calder V)

      Ridley, Rt Hon Nicholas

      Thompson, Patrick (N'ich N)

      Rifkind, Rt Hon Malcolm

      Thorne, Neil (Ilford S)

      Roberts, Wyn (Conwy)

      Thurnham, Peter

      Robinson, Mark (N'port W)

      Tracey, Richard

      Roe, Mrs Marion

      Twinn, Dr Ian

      Ross, Stephen (Isle of Wight)

      Waddington, Rt Hon David

      Rossi, Sir Hugh

      Wakeham, Rt Hon John

      Rowe, Andrew

      Waldegrave, Hon William

      Sackville, Hon Thomas

      Walker, Rt Hon P. (W'cester)

      Sainsbury, Hon Timothy

      Waller, Gary

      Sayeed, Jonathan

      Wardle, C. (Bexhill)

      Shaw, Sir Michael (Scarb')

      Watts, John

      Shelton, William (Streatham)

      Wells, Bowen (Hertford)

      Silvester, Fred

      Wells, Sir John (Maidstone)

      Skeet, Sir Trevor

      Wheeler, John

      Smith, Tim (Beaconsfield)

      Wiggin, Jerry

      Soames, Hon Nicholas

      Winterton, Mrs Ann

      Speed, Keith

      Winterton, Nicholas

      Speller, Tony

      Wolfson, Mark

      Spencer, Derek

      Wood, Timothy

      Stanbrook, Ivor

      Wrigglesworth, Ian

      Steel, Rt Hon David

      Yeo, Tim

      Steen, Anthony

      Young, Sir George (Acton)

      Stern, Michael

      Stevens, Lewis (Nuneaton)

      Tellers for the Ayes:

      Stewart, Allan (Eastwood)

      Mr. Francis Maude and

      Stewart, Andrew (Sherwood)

      Mr. Richard Ryder

      NOES

      Adams, Allen (Paisley N)

      Caborn, Richard

      Ashton, Joe

      Callaghan, Jim (Heyw'd & M)

      Atkinson, N (Tottenham)

      Campbell-Savours, Dale

      Banks, Tony (Newham NW)

      Canavan, Dennis

      Barron, Kevin

      Carter-Jones, Lewis

      Beckett, Mrs Margaret

      Clark, Dr David (S Shields)

      Bermingham, Gerald

      Clarke, Thomas

      Bidwell, Sydney

      Clay, Robert

      Blair, Anthony

      Clelland, David Gordon

      Boothroyd, Miss Betty

      Clwyd, Mrs Ann

      Boyes, Roland

      Cook, Frank (Stockton North)

      Bray, Dr Jeremy

      Cook, Robin F. (Livingston)

      Brown, Gordon (D'f'mline E)

      Craigen, J. M.

      Brown, Hugh D. (Provan)

      Crowther, Stan

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

      Cunliffe, Lawrence

      Brown, Ron (E'burgh, Leith)

      Davies, Rt Hon Denzil (L'lli)

      Buchan, Norman

      Davies, Ronald (Caerphilly)

      464

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

      Morris, Rt Hon J. (Aberavon)

      Deakins, Eric

      O'Brien, William

      Dixon, Donald

      O'Neill, Martin

      Dormand, Jack

      Orme, Rt Hon Stanley

      Dunwoody, Hon Mrs G.

      Park, George

      Eadie, Alex

      Parry, Robert

      Eastham, Ken

      Patchett, Terry

      Evans, John (St. Helens N)

      Pike, Peter

      Fatchett, Derek

      Powell, Raymond (Ogmore)

      Field, Frank (Birkenhead)

      Prescott, John

      Fields, T. (L'pool Broad Gn)

      Radice, Giles

      Flannery, Martin

      Raynsford, Nick

      Foster, Derek

      Redmond, Martin

      Foulkes, George

      Rees, Rt Hon M. (Leeds S)

      Freeson, Rt Hon Reginald

      Richardson, Ms Jo

      George, Bruce

      Roberts, Allan (Bootle)

      Gilbert, Rt Hon Dr John

      Robinson, G. (Coventry NW)

      Godman, Dr Norman

      Rogers, Allan

      Golding, Mrs Llin

      Rooker, J. W.

      Hardy, Peter

      Rowlands, Ted

      Harrison, Rt Hon Walter

      Shore, Rt Hon Peter

      Heffer, Eric S.

      Short, Ms Clare (Ladywood)

      Home Robertson, John

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

      Howarth, George (Knowsley, N)

      Skinner, Dennis

      Hoyle, Douglas

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

      Hughes, Roy (Newport East)

      Snape, Peter

      Janner, Hon Greville

      Spearing, Nigel

      John, Brynmor

      Stewart, Rt Hon D. (W Isles)

      Kaufman, Rt Hon Gerald

      Stott, Roger

      Kinnock, Rt Hon Neil

      Strang, Gavin

      Leadbitter, Ted

      Straw, Jack

      Leighton, Ronald

      Thomas, Dafydd (Merioneth)

      Lewis, Terence (Worsley)

      Thompson, J. (Wansbeck)

      Litherland, Robert

      Thorne, Stan (Preston)

      Lloyd, Tony (Stretford)

      Tinn, James

      Lofthouse, Geoffrey

      Wareing, Robert

      Loyden, Edward

      Weetch, Ken

      McCartney, Hugh

      Welsh, Michael

      McDonald, Dr Oonagh

      Wigley, Dafydd

      McKay, Allen (Penistone)

      Williams, Rt Hon A.

      McWilliam, John

      Wilson, Gordon

      Madden, Max

      Winnick, David

      Marek, Dr John

      Woodall, Alec

      Marshall, David (Shettleston)

      Young, David (Bolton SE)

      Maxton, John

      Maynard, Miss Joan

      Tellers for the Noes:

      Meacher, Michael

      Mr. Frank Haynes and

      Michie, William

      Mr. Sean Hughes.

      Question accordingly agreed to.
      Bill read the Third time, and passed.

  City of London (Various Powers) Bill
  Order for Third Reading read.
  7.11 pm
  Sir Geoffrey Finsberg: I beg to move, That the Bill be now read the Third time.
  I undertake this task for several reasons, first, because my hon. Friend the Member for City of London and Westminster, South (Mr. Brooke) is a Minister, so is debarred from speaking. Secondly, he has been a close colleague and personal friend for more than 20 years and has asked me if I would help him out in this capacity. It also gives me an opportunity to repay some of the great kindnesses shown to me by his late father who was a distinguished Member and Minister in this House.
  My City connections are that I am a member of the Guild of Freemen of the City of London and that I went to the City of London school. Therefore, I have always taken a great delight in what is done in the City. Tonight is somewhat unusual because the Bill had an unopposed Second Reading, has now come back from Committee and we are having this debate because the hon. Member for Newham, North-West (Mr. Banks) tabled a blocking motion. Because we are now on Third Reading, which is a different debate from Second Reading, I shall just describe briefly the Bill's three main proposals. I shall not weary the House with descriptions of a vast number of other useful but less important items.
  First, I shall talk about the Billingsgate fish market. The City has had rights over Billingsgate for about six centuries. In 1982 the market moved to the Isle of Dogs and that was an example of the City's support for the regeneration of docklands, of which it was a pioneer. The City is a tenant in the Isle of Dogs of the Tower Hamlets borough council with which it has an amicable working arrangement. The market provides about 700 jobs for local people.
  As the development of docklands has proceeded, new developments have come along and new schemes and roads have been required. The boundary of the present market may need to be adjusted to fit in with those proposals. Part of the Bill allows for that adjustment and it is proposed to achieve that by what seems to be the best solution, which is an exchange of land. That will also give an opportunity for straightening an irregular site. The City has had discussions with the market traders and the Transport and General Workers Union. As a result, certain amendments will be proposed in the other place to specify the clause's objectives in terms of land exchange. The proposals have the full support of the traders and of the union.
  Secondly, there is the question of street trading, which is covered in clauses 5 to 15 and basically covers what Londoners know as Petticoat lane. When in about the mid-1960s there was a major road improvement scheme in Aldgate, several stall-holders with pitches in the Sunday market in that part of Middlesex street which is now in Tower Hamlets were displaced. I am sure that I am not alone in being among those who have gone happily to Petticoat lane. I do not share the experience of some people of having their own watch sold back to them at the other end of the market but it was a pleasant visit.
  The City agreed to accommodate the traders and a system of licensing was provided under the City of London (Various Powers) Act 1965. Under that Act each of the
  466
  then displaced traders was entitled to a licence and also to nominate a successor to his pitch on his death. The legislation did not provide for further nominations or for granting street trading licences to others. If that position continued, the Middlesex street market—Petticoat lane—would die. The traders did not wish that to happen and they asked for the City's help. Although it was not obliged to do so, the City agreed to remedy that defect under this Bill and a new code was provided to enable the City to grant further street trading licences. The traders strongly support the Bill's proposals.
  I should perhaps put one gloss on street trading, and that is to be found in clause 15, which deals with street photographers. Many of those who operate around Petticoat lane are a nuisance. They operate with pet monkeys and parrots and they let the monkeys hop on to people's shoulders and frighten them. It is considered that there should be licensing of photographers such as the licensing that exists in a vast number of other Acts. There is a clause similar to the one in this Bill in the Greater Manchester Act 1981, the West Midlands County Council Act 1980, the County of Merseyside Act 1980 and the Clwyd Act 1985. So there would be by no means any precedent being created. I stress that the licensing will not affect those undertaking legitimate business, such as journalists.
  In the third part of the Bill additional powers are needed for sanitation and drainage because of the type and density of buildings in the square mile and the problems caused by the immense daytime population. These proposals are supported by the Royal Institution of Chartered Surveyors and many others who must undertake certain works. The rest, as I have said, is a miscellaneous collection of worthy items which I could explain, if necessary.
  I do not know what to explain because, most unusually, the hon. Member for Newham, North-West has failed to respond to requests from either the City of London corporation or its parliamentary agents to say what is worrying him. That gave them no opportunity to try to assist him with any problem that he has. Equally, I would like to have assisted him but, not knowing what he wants to say, I have had to confine myself to the major items in the Bill.
  I will, if I may, ask the leave of the House if need be to respond at the end to any matters that are raised, but I hope that the House will give this Bill its Third Reading.
  7.18 pm
  Mr. Tony Banks: I must tell the hon. Member for Hampstead and Highgate (Sir G. Finsberg) that I tabled a blocking motion on the Bill to secure a short debate. I fully understand and appreciate that it would have been more appropriate for that to have been done on Second Reading, but for a variety of reasons it was not. I had an opportunity of getting a short debate on Third Reading and I am most surprised, indeed gratified, to see such a large attendance for a Bill that I should have thought would have gone through fairly quickly. I do not intend to detain the House long, but there may be some points which Conservative Members wish to make.
  The Bill has not been debated on the Floor of the House. It was not opposed on Second Reading, but was passed as unopposed private business. While I realise that the Chairman and hon. Members on the Committee of the

  467
  unopposed Bill will have scrutinised it, there is no substitute for a good free-ranging debate on the Floor. I appreciate that I cannot have a truly free-ranging debate today because we are now on Third Reading, so I shall stay close to the provisions of the Bill.
  No Bill involving the City of London should pass easily through the House. The title of the Bill, City of London (Various Powers) Bill, reflects the great range of powers, abilities and responsibilities that the City of London retains. As all hon. Members know, the City of London remains a highly controversial body in local government terms. It is amazing that it has managed to survive every local government reorganisation this century. I wish that that could be said of the late Greater London council, of which I had the great honour to be chairman. Perhaps we could learn from the City how to survive against the odds.
  The Herbert Commission report of 1957–60, which led to the London Government Act 1963, states:
  "If we were to be strictly logical we should recommend the amalgamation of the City and Westminster. But logic has its limits and the City lies outside them."
  One understands that the City can defy logic, but from the Bill it is clear that it not only defies logic but has responsibilities which lie well outside its geographical boundaries. The Bill demonstrates that in marked respects.
  I agree with the hon. Member for Hampstead and Highgate that the overwhelming part of the Bill is to be welcomed, so it would not be opposed this evening. Certainly the amendments in respect of Billingsgate are welcome and, as I know, were the result of lengthy discussions with the Billingsgate traders and the TGWU. I should like to pay tribute to my hon. Friend the Member for Bow and Poplar (Mr. Mikardo) who played a significant part in initiating those discussions and reaching an agreed solution for amendments to be tabled in another place.
  Similarly, Clauses 5 to 13 are undoubtedly urgently needed to provide for the continuation of that part of the Middlesex market which is in the City. I pay tribute to my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) who interested himself greatly in those clauses.
  I have reservations about three clauses in particular, the first of which is clause 19. As hon. Members will see, the clause would allow the City to make byelaws under the Animal Health Act 1981 in respect of the animal quarantine station at Heathrow airport without the approval of the Minister. We should not agree to that extension of powers, especially as it does not involve ministerial agreement. The Act is enforced by the corporation and one may say that the City is, in effect, a strategic authority in that respect for 14 London boroughs.
  The London Government Act 1963 made the Corporation of London responsible for the Diseases of Animals Act 1950, which related to imported animals throughout the whole of Greater London, including Heathrow airport. Following an outbreak of rabies in 1969 the legislation on the importation of animals was strengthened and under the terms of the Rabies (Importation of Dogs, Cats and Other Mammals) Order animals can be landed only at ports with an approved holding facility. Heathrow is by far the busiest port in the United Kingdom for animal movements and, as a consequence, the corporation decided to build the animal quarantine station, which was opened in 1977. It is the
  468
  most sophisticated portal animal station in the world and is concerned with preventing disease entering the United Kingdom and safeguarding animal welfare.
  More than 500,000 animals and birds pass through the station each year. The House will wish to be associated with a big "Thank you" to the staff at Heathrow airport who do such an excellent job in protecting our livestock from the importation of animal diseases, especially rabies. I should like to be on record as having thanked the staff for the work that they do.
  However, that function should be carried out by a strategic regional authority and perhaps the GLC should have been responsible for it. That leads me to an important point. When the GLC was being broken up Ministers said that it was being broken up so as to relate services much more closely to the communities for which the services were afforded. It was difficult to do that for animal health and it was certainly difficult to do so for transport, the Thames barrier, the fire service and road traffic management. Therefore, the services were transferred either to Government Departments or to indirectly elected boards.
  If the Government were being absolutely consistent in their local government changes in London, they should have placed the quarantine section at Heathrow under the responsibility of a Government Department. Perhaps the Department of Agriculture, Fisheries and Food would have been the most appropriate. Clause 19 demonstrates, interestingly, the inconsistency of the Government's proposals for the structure of local government and its functions in London. Why should the City of London be responsible for activities at Heathrow airport which is on the other side of the Greater London area? That is why I cannot agree to clause 19, and, if the hon. Gentleman is given an opportunity to reply, perhaps he will explain precisely why that clause is required.
  Mr. Sydney Chapman: I question whether the hon. Gentleman is being logical about the quarantine station at Heathrow airport. Heathrow is the greatest international airport in the world and it is our national airport. If we are to be logical, the Government should take responsibility for that and, indeed, the hon. Gentleman said that. The City of London is contributing nationally £400 million a year or more through rates distribution and is responsible for earning more than £7,000 million a year in trade, so surely it is a question
  Mr. Deputy Speaker (Sir Paul Dean): Order. The hon. Gentleman should relate his remarks to the Bill.
  Mr. Chapman: I apologise, Mr. Deputy Speaker. I am saying that in practice it is perfectly consistent that the quarantine station at Heathrow airport should continue to be managed by the City of London.
  Mr. Banks: Perhaps now the hon. Member for Chipping Barnet (Mr. Chapman) will appreciate the difficulties that I have in speaking on this Bill and staying carefully within the confines of its clauses. I would dearly love to enter into a debate with the hon. Gentleman about the role and function of the City of London in respect of the Greater London area, local government structure, its contribution to the wealth of the nation and so on. However, I would be caught out by you, Mr. Deputy Speaker, in much the same way as the hon. Gentleman. On a more suitable occasion we should get to grips with these problems.
  Mr. Jeremy Hanley: Perhaps the hon. Gentleman can tell us exactly what body he proposes should take over this facility at Heathrow given that, on his admission, it has worked perfectly well over the years and has involved no cost to central Government.
  Mr. Banks: I said and repeat that it has worked admirably but the same could be said of the London fire brigade, the Thames barrier or London Regional Transport. Yet all those services were taken away from the Greater London council. Those functions were taken away, according to Government argument, to rationalise local government structure. If we apply that same, so-called logic to local government structures, why is the City of London—I do not deny it does a good job—still in charge of something that is not only outside its boundaries but unrelated to anything that it does?
  Mr. Patrick Cormack: If the hon. Gentleman thought that the Government were wrong before, he must therefore think that they are right now.
  Mr. Banks: One can be consistent as to whether one is right or wrong. I am not accepting the political arguments advanced for dismantling the Greater London council, but I can see the logic in that argument and all I am saying is that it should be extended to the City of London's functions. One is involved at two levels—one is trying to find logical structures and one is also influenced by political feelings.
  My feelings towards the City of London are biased. I am totally opposed to its continued existence because it is an anachronistic institution which should have been abolished many years ago. I could continue but there will be an opportunity—not tonight—to pursue that strand of the argument to a greater degree.
  I shall try to move with haste as I do not wish to detain the House. Clause 22 of the Bill seeks to amend the Epping Forest Act 1878. I wish to declare an interest straight away. I live in the district of London that is known as Forest Gate. It is on the edge of Epping Forest and Forest Gate is in my constituency of Newham, North-West. Epping forest covers some 6,000 acres. Those hon. Members who have not had the great pleasure of exploring the forest will not be aware that it is situated in the east of London.
  I immediately appreciate and indeed approve of the 19th century reasons for the City of London securing the forest, but in view of the Local Government Act 1985 it would be consistent with that Act if the forest were run by a joint committee of the boroughts and districts in which it lies.
  The clause—I realise that I must talk about that—relates to the register of commoners. The register was for those who were eligible to vote for the verderers section 30 of the Epping Forest Act 1878. I know that my hon. Friend the Member for Blackburn (Mr. Straw) has many family links with the history of Epping forest and perhaps if he catches your eye, Mr. Deputy Speaker, he can find an interesting way to tell us about it.
  The verderers sit on the City's Epping forest committee. Paragraph 5 of the fourth schedule of the 1878 Act says:
  "where a commoner is under age or of unsound mind or a married woman, his or her guardian, committee or husband shall be entitled to be on the register in his or her place."
  I find it intriguing since it is linking those of an unsound mind with married women. It goes to show the great depth
  470
  of sexism that existed in Victorian Britain. Obviously, when a woman married she became nothing more than the chattle of her husband. Clearly this must be changed and that is what the proposed clause seeks to do.
  In all honesty I must report to the House that when I got up at 5 o'clock on Tuesday morning to get to the House for a ten-minute Bill, my wife said that she must have been mad to marry me. [HON. MEMBERS: "Hear, hear."] As a matter of fact, I could not think of anything to say at 5 am except that, if she thought that, she would have been ruled out on two counts from being included in the list of commoners for Epping forest. My wife was not impressed by the argument. However, I told her that when this Bill goes through the House married women would be allowed to be included on the register of commoners——
  Mr. Jack Straw: I wonder whether my hon. Friend can tell us whether he met with success in his ten-minute Bill.
  Mr. Banks: Yes, indeed. I was successful. Who else would get up at 5 o'clock in the morning? The Bill will be on the subject of fixed Parliaments for a five-year period. I include that as an advertisement if hon. Members wish to support me on 4 February.
  In clause 22 the City is seeking to rectify this peculiarly sexist image but it has not done so yet and this is something about which I wish to ask the hon. Member for Hampstead and Highgate.
  This bit of Victorian nonsense will not be removed until 1991 because the appointed day means 1 September 1991. I assume that is the next date for voting verderers on to the committee because the last election for verderers of Epping forest was a year ago. I would like to know what happens if a verderer decides to take the equivalent of the Chiltern Hundreds or if a verderer was trampled by one of the herds of grazing cattle. That in itself is a problem. Many households in the area of Newham, North-East have had cattle wander in from Wanstead flats, which are part of Epping forest and start munching up the gladioli and other herbaceous borders that are common in the area.
  Obviously there is always a danger from stray cattle. Indeed, people in the area like to see this bit of rural England coming down their front paths. I suggested that the grazing rights should be stopped in Epping forest, but I encountered a fairly resilient degree of public opinion expressing the contrary view. Being a good democrat, I decided that the cattle should be left to adorn the constituency of my next-door neighbour the hon. Member for Newham, North-East (Mr. Leighton).
  Qualification for voting for the verderers is still based on owning or occupying half an acre of unbuilt land. This means a property qualification is still involved in a partially democratic process of the City. Of course, the City has maintained practices that have long been abolished in other boroughs and in local government. For example, it still has a business vote and it still has aldermen—a practice that has long since disappeared elsewhere. But the City is always able to defy logic and the reorganisation of local government. Clause 22 again demonstrates that. However, as it goes, I must support it. Nevertheless, it certainly does not go far or fast enough.
  Mr. Hanley: Does the hon. Gentleman feel any gratitude towards the City in that in 1985–86 it cost the City £1·5 million to maintain Epping forest? That is to the

  471
  benefit of all those who use that excellent area, but it costs local ratepayers absolutely nothing and is all at the expense of the City.
  Mr. Banks: I am for ever grateful to the City for its contribution to the ratepayers of Newham, Waltham Forest or, indeed, Epping urban district council. They benefit, but I am talking about logical local government structures and about relating services to the local authority in which they are provided. I am just being logical, and it seems to me that there can be no logic in the City running Epping forest, Wanstead flats, Chingford golf course, West Ham park, Burnham beeches—the one that Hammer Horrors always used—the Kent and Surrey commons or Highgate woods. I quickly slipped those into my speech to demonstrate that we are not just talking about Epping forest. The City has acres of green land throughout the whole of the Greater London area. No doubt all those who use those recreational areas are grateful to the City, but the question is whether it is logical. It is logical to be grateful, but is it logical for the City to run them still?
  Clause 24 relates to the Central London Railway Act 1892. I have secured a copy of that Act. Section 28(5) refers to Mansion house station and says:
  "Except as regards any entrances facing the Royal Exchange the Commissioners or the Commissioner of the City police shall have powers to close all public entrances to the station or subways at such times and for such purposes as they may deem necessary."
  I do not understand why the entrances facing the Royal Exchange could not be closed, unless they had to stay open for people dashing out in order to get out of Czarist bonds and into other stocks.
  Mr. Hanley: I am sorry to intervene so often in the hon. Gentleman's speech but perhaps it will help to bring his comments to a close. I believe that that entrance had to remain open because there was a public convenience there, to which the public needed ready access. I am sure that the hon. Gentleman would welcome that as something provided by the City for people from all parts of the country who happen to be visiting the City.
  Mr. Banks: I would always defer to the hon. Gentleman when it comes to a knowledge of public conveniences around London. Indeed, I am very grateful for that piece of information. In many ways it demonstrates how useful this sort of debate can be, because one can, at times, exchange incredibly useful information.
  Why does clause 24 seek to give similar powers to the corporation and to the Commissioner of Police in respect of the entrances to Bank underground station for whatever purposes "they may deem necessary"? Enormous powers are being given to the City corporation. Why should the City corporation be granted those additional powers by the House? I should certainly like to oppose the clause.
  Clause 2(1) talks about the Commissioner of Police for the City. That is another anachronism. The City has its own police force, and that is unique to London. Ministers jump up and say that it is nonsense for London boroughs to want to become involved in the democratic accountability of the Metropolitan police, but they never refer back to the City, which has had responsibility for policing its own area for many years. This is another perfect example of how the City is always made the
  472
  exception to the rule when it comes to democratic structures, democratic processes or London local government.
  I heard what the hon. Member for Richmond and Barnes (Mr. Hanley) said, and I do not wish to detain the House further. I was, of course, thinking of calling a Division on Third Reading, but clearly we are not particularly well equipped for that. All those who promised me their attendance have clearly failed, and so on this occasion I shall not push the debate to a vote. Nevertheless, the Bill exemplifies the City's illogical position in respect of its powers and responsibilities within the structure of local government. It is an institution long overdue for change, and that will be the task of the next Labour Government.
  7.45 pm
  Sir John Biggs-Davison: I always enjoy listening to my hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg), and it is a pleasure to support the Bill's Third Reading which he so agreeably moved.
  If the Labour party has its way, there will not he many more such private Bills. The hon. Member for Newham, North-West (Mr. Banks), for example, is eager to destroy the ancient traditions and institutions of the City of London. But, although they offend his logic, they are cherished at home and honoured abroad. Indeed, I think that Tory Members would be inclined to say blow logic if illogicality gives efficiency and satisfaction. It is apparent from the hon. Gentleman's speech that the Opposition's hostility to the City arises in part from their fury that the GLC is no more, and is so little lamented.
  I was glad that my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) intervened. I have no interests in the City, but I salute the City corporation in their capacity of Conservators of Epping Forest, whose northern parishes I have the honour to represent. The hon. Member for Newham, North-West had something to say about clause 22. He is un-English in his addiction to logic, and he spoke of the City corporation as a strategic authority. He mentioned, in particular, the animal quarantine arrangements and animal welfare provision at Heathrow airport. Hon. Members will want to echo what he said in generous praise of the staff there. But the difference between him and me, and no doubt my hon. Friends, is that when the public obtain a service at no cost to the taxpayer, we are glad and he is sorry.
  My experience of the City's extra territorial responsibilities in connection with Epping forest has been a happy one. Indeed, when the GLC was being abolished, I proposed that the Lord Mayor and the corporation of London should thereafter not only serve as a unifying symbol and focus of loyalty for Londoners, but also provide a framework for those common services that fell outside the responsibility of the London borough councils. The Friends of Hainault Forest, under my presidency, also proposed that the City corporation should take on Hainault forest, which once formed part of the great forest of Waltham or forest of Essex, or, as we usually call it now, Epping forest. Unfortunately, we did not succeed.
  The purpose of clause 22 of the Bill was explained by the hon. Member for Newham, North-West. Clearly, the schedule in the Epping Forest Act 1878, which he quoted, is offensive. Any commoner in the forest parishes may he registered as an elector for the choice every seven years of

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  the four verderers. Verderers provide local representation in the management of the forest, which is run extra-territorially by the City corporation through the Epping Forest Committee.
  Contrary to the belief of the hon. Member for Newham, North-West, who wanted to bring in a greater measure of local control of Epping forest, the fact that, for more than a century, it has been under a remote authority has preserved it from the increasingly powerful pressures of local builders and developers.
  A certain member of the public noticed that the offensive terms of the schedule appeared in the literature that was circulated for the election of verderers. As a result of that, the Equal Opportunities Commission wrote that, in its view, the provision was:
  "harmful to the status of married women and certainly against the spirit of the anti-discrimination legislation."
  As far as I can determine, there is no example of an occasion on which a husband decided to exercise the right to register himself in place of his wife, but the right is offensive. I rather like anachonisms, but I do not like this one.
  The Sex Discrimination Act 1975 does not right the wrong because of a provision which states that the Act does not render unlawful
  "any act done by a person if it were necessary for him to do it in order to comply with a requirement of an Act of Parliament passed before this Act."
  Clearly, the Epping Forest Act 1878 was passed before the Sex Discrimination Act 1975. The House will welcome the steps being taken by the City of London Corporation to remove this obsolete and offensive disfranchisement.
  7.52 pm
  Mr. Sydney Chapman: I wish to make three comments about clauses 7, 19 and 22 of the Bill. Even if the hon. Member for Newham, North-West (Mr. Banks) voted against clause 19, he would not in any way solve the problem. Other legislation would be needed. As you correctly said, Mr. Deputy Speaker, that debate will have to wait for another day. I echo the point that the quarantine service at Heathrow is a splendid service provided free by the City of London for the benefit of the nation.
  I listened with a great deal of sympathy to the criticisms implicitly made by the hon. Member for Newham, North-West about the sexism contained in clause 22, the reasons for which have been explained by my hon. Friend the Member for Epping Forest (Sir J. Biggs-Davison). My surname, Chapman, twice contravenes the provisions of the Sex Discrimination Act 1975. I should like to see that measure reorganised to accommodate at least my political embarrassment on that score.
  My hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg) made an excellent point about the trading licences in Middlesex street. Although we have abolished the county, thank goodness we are not abolishing the street which is sometimes colloquially known as Petticoat lane. Again, my surname plays a modest part in clause 7. I admit that, according to Chaucer, a chapman is a pedlar of cheap, down-market goods.
  Mr. Tony Banks: That is a good description of the Government.
  Mr. Chapman: Perhaps there is hope for me in it, then. I should add that I have no interest in Middlesex street, or that part of it which is in the City of London, but it is right to pass clause 7 because it honours a commitment that was given in good faith. It is no fault of the City corporation that it would act outside the law if it were to grant these licences to these people and their successors.
  I welcome clause 7 and the Bill as a whole. Although this matter is for another day and another debate, Londoners in particular and the country in general should acknowledge and put on record the great contribution that the City makes to our life and to the revenue of the Government and local authorities. I pay tribute to the City corporation and wish it well in the future.
  7.55 pm
  The Parliamentary Under-Secretary of State for the Environment (Mr. Christopher Chope): It may be helpful if, at this point, I intervene to give a brief explanation of the Government's view on the Bill. Before I do so, I thank my hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg) for bringing the Bill before the House. It is apparent that the narrow scope of the Bill causes a sense of frustration amongst hon. Members, especially when the short title looks so promising for a continuation about the great debate about London government. I must admit to sharing the sense of frustration at not being able to debate the wider issues tonight.
  It is a pleasure to see my hon. Friend the Member for the City of London and Westminster, South (Mr. Brooke) in the Chamber. I served as his PPS for a happy period until last September. I am delighted to see him here, and I am sure that he is disappointed at not being able, by reason of the office that he holds, to participate in this interesting debate.
  It is traditional that, on private Bills, the Government take a neutral stance, and this Bill is no exception to that rule. The Government have considered the content of the Bill and have no objection in principle to the powers sought by the corporation. It is for the promoters to persuade Parliament that the powers they are seeking are necessary and justified. My Department and my right hon. Friend the Home Secretary are still negotiating with the promoters on some outstanding points, and I hope that these will be cleared up satisfactorily.
  The Bill was unopposed in Committee in March last year. In the Government's view, none of the matters raised tonight is of sufficient importance to warrant further delay to the progress of this Bill, and I recommend that it be allowed to proceed.
  7.57 pm
  Mr. Jeremy Hanley: I echo the views of my hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg) and others in supporting the Bill and in refuting an argument raised by the hon. Member for Newham, North-West (Mr. Banks). The hon. Gentleman said that it was inconsistent Government policy to allow the City of London to look after the quarantine station at Heathrow, as it has done for many years and with great success, and also to allow it to retain its rights, powers and generosity over Epping forest and so many other areas within Greater London. It is not inconsistent to allow an authority to continue to run these matters if it does so with due care, proper frugality, and proper economy and provides an excellent service to all

  475
  who use its facilities. It is not against Governments policy to allow a fully democratic authority that has been nothing but of benefit to the nation. It also is not against Government policy to allow a Bill that has involved consultation in the widest sense. The Bill relates to an organisation in the City of London that has the acquiescence of all the people who have been interested in its various parts.
  Mr. Tony Banks: Will the hon. Gentleman explain how he can claim that the City of London is truly democratic when, for example, the aldermen of the City are elected for life and have a business vote?
  Mr. Hanley: It is not undemocratic to allow a vote to people who have a direct interest in the area concerned. If 99 per cent. of those who occupy the City happen to be those who run businesses in that area, surely it is democratic to give those people a vote. It would be undemocratic to remove the vote in other areas, but that debate is outside the ambit of this evening's discussion. Therefore, I shall not be drawn on that.
  It is wholly within the Government's policy to allow a successful organisation, such as the City of London Corporation, the powers which show how it is successfully dealing with changing situations, for example, the way in which it is dealing with Middlesex street market, Billingsgate market, the drainage and sanitation problems, and the large population within the square mile where the type and density of buildings are always changing and the buildings are getting ever higher. The powers would also allow the corporation to show the way in which it deals with the problems faced by tourists in London, for example, the problems that have occurred because of the use of animals by photographic traders, and the way in which it deals with the City walkways.
  The hon. Member for Newham, North-West will remember the way in which the corporation helped to fund the Museum of London. I know that the hon. Gentleman has great confidence in that musem because he has deposited some valuable items there, to be exhibited to the general public for all time.@@
  I know that all hon. Members are grateful to the corporation for the work that it has done for many hundreds of years—indeed, for a considerably longer time than the Greater London council existed.
  Mr. Tony Banks rose——
  Mr. Hanley: If the Greater London council had carried on its business with the responsibility that is shown by the City of London Corporation, it might still be in existence.
  8.3 pm
  Mr. Patrick Cormack: As I listened to the pertinent and felicitous intervention of my hon. Friend the Under-Secretary, I could not help but think, would that the Government's neutrality was always as benevolent as tonight, and would that ministerial interventions were always as brief and to the point.
  I shall he brief, but I should like to do something that no hon. Member has yet been charitable enough to do, and that is to thank the hon. Member for Newham, North-West (Mr. Banks) for giving us the opportunity to put on record the value of the City of London. The hon. Gentleman has performed a signal service and we are all much in his debt. As a freeman of the City and a resident of it, I believe that it functions with great distinction.
  Mr. John Wheeler: My hon. Friend is also a voter within the City.
  Mr. Cormack: If the House ever embraced the doctrine that logic should be our master in all things, we should be in for real trouble. Logic is a good enough servant, but it is a bad master. I am happy that there should be certain illogicalities. I recognise that there are some in the City of London, but, despite that, it does work. It is a proud flagship for Britain. Long may it sail into the future, and long may we support it.
  8.6 pm
  Mr. Jack Straw: Like the hon. Member for Staffordshire, South (Mr. Cormack), my hon. Friends and I are grateful to my hon. Friend the Member for Newham, North-West (Mr. Banks) for affording us the opportunity of this short debate on certain aspects of the operation of the City of London.
  As you have made clear, Mr. Deputy Speaker, this is not the occasion for a debate on the constitution of the City. However, I should like to add that the Labour party is about to state, in its discussion document on the future policies of a Labour Government, that it would review the position of the City of London, because the City's present constitution reflects the time when the City was extremely populous. Many people—not just those in the Labour party—take the view that the constitution should be modernised.
  It is also worth reflecting upon the fact that on many occasions in previous centuries the City of London corporation, the common council, adopted a radical stance and was opposed to the Government. For example, in the 18th century arguments on whether the then hon. Member for Middlesex should be allowed to take his seat——
  Sir J. Biggs-Davison: And the 17th century——
  Mr. Straw: Indeed, there were similar arguments in the 17th century.
  Our concern is not in any way to throw away the goods because much that the City of London does is good, but to bring the City and its constitution up to date.
  I should also like to comment on the percentage over grant-related expenditure assessment, and expenditure increases. You will recall, Mr. Deputy Speaker, that no debate on the problems faced by good Labour authorities is ever complete without a reference to the fact that under the curious system of block grant—rate support grant—that the Government have established, the authority that shows the greatest increase in expenditure in the past seven years is the City of London with an increase of about 300 per cent. The authority that shows the greatest percentage increase over its grant-related expenditure assessment is also the City of London. However, somehow the City always manages to escape rate-capping, while authorities with far more moderate increases in expenditure, for example, Islington and Newham, are somehow caught.
  I shall turn now to the merits of the Bill. As my hon. Friend the Member for Newham, North-West recited, my hon. Friend the Member for Bow and Poplar (Mr. Mikardo) and my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) were heavily involved in those parts of the Bill that relate to Billingsgate market and those that relate to the Middlesex street market. My right hon. Friend and my hon. Friend are

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  anxious that those provisions, as they now appear in the Bill, become law as quickly as possible. I pay tribute to both of them for their work in ensuring that those matters are included in the Bill as it is cast at present.
  The other part of the Bill that has aroused discussion relates to the verderers of Epping forest. My hon. Friend the Member for Newham, North-West spoke about my family connections with Epping forest. I shall not go into all those connections, except to say that in the previous century my family were among the villagers in the then agricultural village of Loughton who, along with many other people, fought the lords of the manor to prevent the enclosure of the forest.
  Sir J. Biggs-Davison: Hear, hear.
  Mr. Straw: I am glad that I am joined in that by the hon. Member for Epping Forest (Sir J. Biggs-Davison). The first consequence of that great battle, in which much was at stake because the villagers had the rights of lopping and grazing in the forest, was the founding of the Commons Preservation Society—not the House of Commons but green commons. The society weighed in in support of the villagers. Legal actions were brought against the lords of the manor and, some time later, the City of London agreed to run the great forest for the benefit of the people of Essex and London. That was confirmed when Queen Victoria came to open the new forest.
  As I have said, I disagree to some extent with the way in which the City is run. I speak as somebody who was brought up almost in the forest. The concrete playground of my primary school was exactly opposite the forest. My family still live there, and I cannot say that I can recollect any serious arguments about the way in which the City have administered the forest.
  The Bill is a modest amendment and it is important within the context of equal opportunities legislation. I hope that it is agreed to.
  8.9 pm
  Sir Geoffrey Finsberg: I am not sure if the hon. Member for Blackburn (Mr. Straw) is related to Herne the Hunter in that he played in the forest. I seem to remember that Herne came to a rather strange end. The hon. Member implied that in the year 2005 the future of the City may be reviewed. All I would say is that the future of the City was reviewed not long ago. It was reviewed following the Royal Commission that produced the London Government Act 1963. However, I should remind the hon. Gentleman that his comments on GREA were an echo of a parliamentary question tabled by his hon. Friend the Member for Copeland (Dr. Cunningham). The hon. Member for Copeland was shot down in flames by my right hon. Friend the Member for Wanstead and Woodford (Mr. Jenkin) and we heard no more from him on that subject.
  We have had a strange evening. We have all been debating one subject while behind that facade was another much greater and more contentious issue champing at the bit. However, with your help, Mr. Deputy Speaker, it was not allowed to come under starter's orders. I look forward to that occasion. On a previous occasion I have defended the City against the philistines on the Opposition Benches who wish to abolish it. I am sure that that time will come
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  again. I doubt if the hon. Member for Newham, North-West (Mr. Banks) and I have ever had such an agreeable confrontation. Perhaps that should happen more often.
  I found it difficult to help my hon. Friend the Member for Chipping Barnet (Mr. Chapman) to remain within the terms of the Equal Opportunities Commission except perhaps to address him as, "Person, person" because I cannot think of a colloquialism for, "chap". However, it may come to me.
  The immortal words on neutrality read out by my hon. Friend the Under-Secretary of State struck a familiar note. I have read such words on many occasions with great unhappiness. I am sure that perhaps on this occasion my hon. Friend would have liked to contribute more to the discussion.
  I thank my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) for his contribution and for helping me to obtain the information that I needed to answer some of the questions.
  My hon. Friend the Member for Staffordshire, South (Mr. Cormack) chided me for not having praised the City. I did that deliberately because I thought that if I praised it too much it might have a counter-effect on other hon. Members which, in turn, might have made the debate more contentious. I yield to no one in my admiration for the City and I am delighted that my hon. Friend put that fact on record.
  The hon. Member for Newham, North-West made clear his reason for the debate. He said it was because of his hatred—I do not think that I use the wrong word—for the City of London as a local authority. I do not approve, but I understand. However, I must remind him that it has survived by virtue of various Royal Commissions. He gave us the pleasure of quoting from paragraph 935 of the Herbert report. It is sad that he did not quote the paragraph before. For the sake of completeness, because I know that he is a rounded person and likes to be complete, I shall quote paragraph 934. It states:
  "It will be seen that we propose that the City of London should remain as a separate entity within its present limits. This is an anomaly but we recommend that this anomaly should continue and we make this recommendation as a definite, not a provisional recommendation."
  I shall now deal with the quarantine and animal health facilities at London airport. The question of the hon. Member for Newham, North-West was fair but wholly illogical. The City was doing that work long before the GLC was established. Therefore, the argument that the function should have gone to central Government or elsewhere when the GLC was rightfully abolished does not hold water. It was carefully considered and it was decided that the GLC should not undertake that function. If it was not undertaken by the City, the cost would fall on central Government or the London boroughs. At present it is paid for by the City. There is no Government grant or subsidy. If the hon. Gentleman would like to fight a campaign to charge the London boroughs for carrying out that service and make them pay for it, I do not think that he would be popular with the London Labour party. He certainly would not be popular with the London Labour boroughs. I suggest that he should gulp hard and let sleeping dogs lie.
  Under the present legislation byelaws have been placing a difficult and heavy administrative burden upon the Department of the Environment. It recognises it as such

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  and accordingly has decided that it is not necessary for the Department to confirm any byelaws. Therefore, the change has the consent of the Department.
  My hon. Friend the Member for Epping Forest (Sir J. Biggs-Davison) gave a long explanation of clause 22 to the House. Therefore, I can be brief, because he has given the salient facts. However, as the House knows, the City saved Epping forest from enclosure in the 19th century. It now maintains it at no expense to the ratepayer or taxpayer. Does the hon. Member for Newham, North-West wish those costs to fall upon the London ratepayers? If he does, which is the logic of his proposal, I shall ensure that that fact is known and added to the other costs that he wants to put on them. I do not think that he will be too popular with his colleagues. Like his predecessor—I say this pleasantly—he may have difficulty in reselection.
  Mr. Tony Banks: I can assure the hon. Gentleman that I will have no difficulty in reselection. In fact, I have already been reselected. However, the national executive of the Labour party has not approved the reselection because of the involvement of black sections. We shall pass quickly over that. I am sure that I will be imposed on the constituency in the end. I would expect to see the charge for Epping forest fall on the ratepayers of Greater London. However, it would be done on a reorganisation that would free all the City cash and assets for use by Greater London as well. Therefore, we would not be depriving ourselves of City cash but using it more generously around the rest of London.
  Sir Geoffrey Finsberg: If the hon. Gentleman deprived the City of its cash, that would be a once-and-for-all operation. The annual revenue costs would be rather like
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  the goose that laid the golden egg. If one whips the goose away, the golden eggs do not last much longer. Therefore, the hon. Gentleman's suggestion is a little illogical.
  Sir John Biggs-Davison: Presumably, if the city corporation was deprived of the management of Epping forest it might be that the ratepayers of Epping Forest would be asked to contribute. They certainly would not wish to do so.
  Sir Geoffrey Finsberg: Had the good burgesses of Newham, North-West known that the hon. Gentleman wanted to put the extra burdens upon them, he might not have been reselected. However, we will leave that point.
  The hon. Member for Newham North-West raised a helpful point on the 1991 issue. I shall see that it is looked at. The problems that might come up if there were a vacancy need to be looked at. It will not come into effect until 1991 because, as he rightly summised, there will not be a general election of verderers until then. They have a fixed term. However, the hon. Gentleman is clearly an advocate of fixed terms. There are lengthy needs of publication. When one places notices on trees they may be eaten by wandering cattle, butted by deer and may have to be replaced. Therefore, it takes a certain amount of time.
  The Bill is useful and, as has been said, the debate has been interesting and pleasant. It has fully justified the existence of the City because it has proved how the City can do a large number of things at no cost to the ratepayer or taxpayer and that it can provide a remarkably good service. I hope that the House will give the Bill its Third Reading.
  Question put and agreed to.
  Bill read the Third time, and passed.

  Double Taxation Relief
  8.19 pm
  The Minister of State, Treasury (Mr. Peter Brooke): I beg to move,
  That an humble Address be presented to Her Majesty, praying that the Double Taxation Relief (Taxes on Income) (Mauritius) Order 1986 be made in the form of the draft laid before this House on 5th December.
  I suggest that it will be for the convenience of the House if we also discuss motion No. 3:
  That an humble Address be presented to Her Majesty, praying that the Double Taxation Relief (Taxes on Income) (France) Order 1986 be made in the form of the draft laid before this House on 5th December.
  The House might find it helpful if I begin by saying a few words about double taxation conventions generally before turning to the orders themselves.
  The United Kingdom has an extensive network of bilateral double taxation treaties. Their purpose is to give relief from the burden of international double taxation which would otherwise result when income arises in one country, flows to another and is taxed in both.
  Broadly speaking, and depending upon the nature of the income and laws of the country concerned, relief is usually provided by the country in which the income arises, reducing its rates of tax, and in some cases giving up the right to tax altogether. In addition, where income remains taxable in both countries, the country in which the recipient is resident will give credit against its tax on that income in respect of the tax paid in the country of source, or will give relief from double taxation by exempting that income from tax in the country of residence.
  Double taxation agreements, amongst other things, lay down rules for the taxing of income flowing between the two treaty partners. They also provide rules for taxing a resident of one country who carries on business in the other country.
  Another important function of a double taxation agreement is to fix maximum rates of tax that may be applied by the country of source to certain categories of income—for example, dividends, interest and royalties. These rates will remain unaffected by any subsequent increase in domestic tax rates in either country. Double taxation conventions help to create a stable fiscal framework within which international trade and investment can develop to the mutual benefit of the two countries.
  We already have comprehensive double taxation conventions with France and Mauritius. The protocol with France adds an entirely new article to the existing provisions, setting out clearly defined rules for taxing certain offshore activities. The protocol with Mauritius amends the existing convention by substituting a new article covering the taxation treatment of dividends. I shall deal with the main provisions of each order in turn, starting with France. This order concerns the taxation of income from offshore oil and gas activities on the continental shelf.
  It is generally recognised by countries around the North sea and English channel, and many others, that special rules are needed to take account of the special circumstances arising in offshore exploration and development. France, although having little offshore oil of its own to date, agreed that the terms of the existing convention needed to be modified to take these special considerations into account.
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  This offshore protocol is not to be confused with another protocol which deals, inter alia, with certain tax matters relating to the Channel fixed link. The terms of this protocol have been agreed in principle, but the final text is still being discussed. My right hon. Friend the Financial Secretary announced these arrangements on 10 July 1986 in reply to a parliamentary question.
  The protocol before us follows the pattern of similar amendments made in recent years to conventions with Canada, Finland, the Netherlands, Norway, Sweden and the United States. Basically, the general rule is that an enterprise of one country carrying on activities relating to mineral exploration or exploitation on the continental shelf of the other country may be taxed in that other country on profits from those activities. Any double taxation is to be relieved by credit in the country of residence. The taxation of profits from the transportation of supplies or personnel, however, follows the normal rules which apply to the taxation of international shipping. These provide for taxation solely in the country of residence of the operator.
  This protocol is not essential for the taxation of profits from offshore oil and gas production, which are taxable in the producing country under the normal rules. The reason it is needed is to overcome uncertainties surrounding the tax treatment of the various exploration, service and support activities of contractors engaged by the oil companies, particularly where these activities take place on board, or from, mobile vessels. The provisions of the present convention were not devised with these activities in mind.
  The protocol will have effect in the calendar year following that in which it comes into force. It cannot come into force until both countries have notified one another of the completion of their legislative procedures.
  I now come to the order with Mauritius. This contains the text of a protocol which amends the existing dividends article in the convention. The 1984 Mauritian Finance Act introduced substantial changes to the taxation of company profits and dividends. An unintended consequence was that the provisions of the dividend article of the existing convention effectively prevented Mauritius from charging tax on dividends flowing to the United Kingdom. Mauritius requested an amendment to the existing convention so that their taxing rights could be restored.
  In the new dividend article, Mauritius has agreed to rates of tax which are not excessive and which compare favourably with those contained in broadly similar agreements that the United Kingdom has with other developing countries. The rate for direct investors is 10 per cent—that is, where the beneficial owner of the dividends is a company controlling at least 10 per cent. of the voting power of the company paying the dividends. In all other cases, Mauritius will be able to apply a rate not exceeding 15 per cent. of the gross amount of the dividends.
  The protocol will have effect in relation to dividends paid on or after 1 July 1986. In practice, this means that dividends paid to a United Kingdom resident would be taxed in Mauritius only from the year of assessment beginning 1 July 1987. Mauritius has forgone its taxing rights on dividends flowing to the United Kingdom until the protocol takes effect.
  I commend these two draft orders to the House on the basis that they strike a fair balance between the interests of the various countries concerned and the United

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  Kingdom, and, indeed, between the interests of the residents of those countries and those of the United Kingdom. I shall be happy to deal, so far as I can, with any points on them which may concern hon. Members. Subject to that, I hope that the House will approve the two orders.
  8.24 pm
  Mr. Tony Blair: The purpose of the double taxation conventions is to ensure, first, that there is no double taxation of an unfair nature, and, secondly, that there are no opportunities for fiscal evasion.
  I shall deal first with the order in relation to France. The order inserts effectively a new article in the convention of 1968. I can be brief in dealing with it, but there are one or two minor points that I should like cleared up.
  The new article 29A does a number of different things. First, in paragraph 1, it ensures that where an enterprise of one country conducts offshore activities under the jurisdiction of the other, it is deemed to be carrying on business through a permanent establishment in that other country. The effect would be that if a United Kingdom company were conducting offshore oil exploration in French territory it would be liable for tax in France.
  I want to make sure that the effect of the new article 29A, taken in conjunction with the articles that already exist, will ensure that there is double taxation relief for the liability to French tax of that United Kingdom company. The effect of article 29A will be that the United Kingdom company exploring on French territory is treated as liable for tax in France. Presumably, under the other articles of the convention, relief is given for any double taxation element.
  Secondly, paragraph 3 of the new article 29A provides that independent professional activities carried on in connection with the oil or gas exploration or exploitation in the other contracting state is deemed to be performed from a fixed base in the country where those activities are carried on. In other words, it is similar to offshore activities in connection wth oil or gas exploration. I assume that, for example, canteen facilities on a French oil rig provided by a United Kingdom company would be liable for French tax.
  As the Minister said, the exception arises in circumstances where profits are derived from the transportation of supplies or personnel. That follows the normal rules of international shipping and they are taxable only in the state in which the taxpayer is resident. I assume that a United Kingdom helicopter company transporting personnel to a French oil rig is still taxed as a United Kingdom resident. I simply wanted confirmation that I have understood the effect of the order relating to France.
  The protocol in the order relating to Mauritius amends the 1987 convention with Mauritius on double taxation. As the Minister said, it follows changes in the law of Mauritius on the taxation and distribution of company profits and distributions. Therefore, in principle, since it involves changes in the law, or is consequent upon changes in the law of Mauritius, I assume that, in principle, the treatment of dividends flowing from a United Kingdom company to a Mauritius resident or shareholder is unchanged.
  As I understand it, at present, dividends coming from a United Kingdom company to a Mauritius resident or shareholder will be taxed in Mauritius. The Mauritius resident is entitled to a tax credit in the United Kingdom.
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  But where he is entitled to a tax credit, he is also taxable in the United Kingdom on the aggregate of the dividends and the tax credit, but at a rate not exceeding 15 per cent.
  I notice one slight change. To be entitled to a tax credit in the United Kingdom, the Mauritius resident under the new article 10 must, in order to be entitled to a tax credit in the United Kingdom, be
  "the beneficial owner of the dividend",
  whereas previously I think that the words were
  "subject to tax in Mauritius".
  I assume that that is merely a technical change and has no significance.
  The main item in the order relating to Mauritius is the change in the treatment of dividends coming to United Kingdom residents from a Mauritius company. I have one point that I should like the Minister to elucidate because I have not entirely understood the effect of the order. As I understand it, previously, under the old paragraph 4 of article 10, for which the order substitutes a new paragraph, where a United Kingdom shareholder received a dividend from a Mauritius company and corporation tax was charged in Mauritius, the dividend would be taxed in the United Kingdom, but there would be no tax on the dividend in Mauritius. What has happened now is that the United Kingdom shareholder who receives a dividend from a Mauritius company will be taxed in the United Kingdom, but also in Mauritius—up to 10 per cent., if the United Kingdom shareholder is a controlling company of more than 10 per cent. of the voting power of the Mauritius company, or otherwise up to 15 per cent.
  This is important in case there are any consequences to United Kingdom residents. I rather assumed that Mauritius might previously have applied a sort of classical system of taxation and dividends would be distributed on the after-tax profits of the Mauritian company, and had changed to some sort of imputation system so that dividends were distributed through the pre-tax profits, as with our advance corporation tax, and that that was why it was necessary to introduce an ability to tax dividends in the United Kingdom and in Mauritius. If I am wrong about that, perhaps I could be told.
  In general terms, can the Minister tell us what the implication will be for United Kingdom residents? Has he any financial estimate of the order's implications? Will the United Kingdom's revenue be adversely affected? The same applies to the order relating to France. Can the Minister tell us in general terms what the revenue implications will be? Will they be adverse for the United Kingdom tax holder?
  I am aware that these are complicated measures. I do not need to detain the House further, but since the orders are before us I thought it right to raise these queries.
  8.34 pm
  Mr. Brooke: With the leave of the House, I shall be delighted to respond to the questions of the hon. Member for Sedgefield (Mr. Blair).
  The hon. Gentleman asked about double taxation relief on the French order. I can give him a complete assurance that there will be no change in the relief available against United Kingdom tax on the same income under article 24 of the convention. Similarly, in the hon. Gentleman's example of a United Kingdom company transporting personnel to a French oil or gas rig, I can confirm that that would be taxable in the United Kingdom along the lines that he suggested.

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  On the Mauritian order, the hon. Gentleman made a correct assumption about the situation before 1984. The Mauritian element has come in because, as I said, of the changes that Mauritius made to its domestic tax law in 1984 when, inadvertently, it precluded itself from taxing dividends that were flowing to the United Kingdom.
  Before the changes that were made in 1984, dividends were allowable as deductions in computing a company's chargeable profits, and were treated as taxable income in the hands of the shareholders—whether or not such persons were residents. Rates of Mauritian tax have varied, but at the time of the change a public company was taxed at a rate of 50 per cent. and a private company at a rate of 60 per cent. In addition, a surcharge of 10 per cent. of the tax payable was also imposed, making the effective rates 55 per cent. and 66 per cent. respectively. Individuals were taxed progressively, and in some years the maximum rate was as high as 80 per cent. The terms of the existing convention allowed Mauritius to apply its domestic rates without restriction. Since 1984, dividends have not been treated as allowable deductions. There is no provision for withholding tax when dividends are paid, and so dividends are taxed like any other income, but where a non-resident company derives dividends from a resident company, Mauritian tax is payable by the shareholding company at a rate of 35 per cent. Where a shareholder is an individual, tax is applied on a progressive scale, ranging from 5 per cent. to 35 per cent.
  I do not want to go through an elaborate arithmetical calculation but, before the 1984 changes, a subsidiary of a United Kingdom company in Mauritius, which wished to remit profits entirely as a dividend, would have nil taxable profits in Mauritius. The Mauritius income in the United Kingdom was charged so that in total the dividend after Mauritius tax was 45 per cent. of the original profit of, say, 100. In the United Kingdom the foreign dividend of 100 was charged at 50 per cent., according to United Kingdom tax law in 1983.
  There was a further overseas tax of 55, of which 5 was unrelieved because of the Mauritian tax of 55 per cent. Therefore, the United Kingdom tax payable was nil.
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  Under the post-1984 changes under the convention, as amended by this protocol, the subsidiary of the United Kingdom company in Mauritius will have a Mauritian income of 65, after the deduction of 35 of Mauritian tax. But there will then be a Mauritian tax at the treaty rate of 10 per cent. Therefore, there will be a further 6·5 per cent. of tax, producing a net income of 58·5 per cent.
  In the United Kingdom the foreign dividend would be grossed up for underlying relief. If one assumes a United Kingdom tax of 35 per cent., the overseas tax on the dividend will be 6·5, as I described a moment ago, and the tax on the profits will be 35. Of the overseas tax, 5 was unrelieved because of the Mauritian tax of 55 that I have described. Whereas we previously had an unrelieved figure of 5 per cent., we now have an unrelieved figure of 6·5 per cent. Again, no United Kingdom tax will be payable. Those are complicated figures and I shall not take the House through what would have happened if we had not amended them. It will be clear to the House that the changes are not of great significance but they are helpful to Mauritius. The flow of finance between Mauritius and the United Kingdom is traditionally confidential, but we are not talking about large sums of money.
  Question put and agreed to.
  Resolved,
  That an humble Address be presented to Her Majesty, praying that the Double Taxation Relief (Taxes on Income) (Mauritius) Order 1986 be made in the form of the draft laid before this House on 5th December.
  Resolved,
  That an humble Address be presented to Her Majesty, praying that the Double Taxation Relief (Taxes on Income) (France) Order 1986 be made in the form of the draft laid before this House on 5th December.—[Mr. Brooke.]

  AGRICULTURAL MARKETING
  Ordered,
  That the provisions of pargraph (2) of Standing Order No. 84 (Constitution of standing committees), paragraph (1) of Standing Order No. 86 (Nomination of standing committees), and Standing Order No. 101 (Standing Committees on Statutory Instruments, &c.)all apply to the draft Amendments of the Potato Marketing Scheme 1955, as amended, as if they were a draft Statutory Instrument; and that the said draft Amendments be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Portillo.]

  Talbot Green, Mid Glamorgan
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Portillo.]
  8.41 pm
  Mr. Brynmor John: I rarely take advantage of this procedure, but I am grateful for the opportunity to address the House on an issue which has caused a great deal of local anxiety. It would be of assistance to the House if I explained the position of Talbot Green. It is situated at the mouth of the Ely valley and has been growing commercially and residentially. Many of its inhabitants travel to work to Bridgend in the west, to Pontypridd in the east, to Tonyrefail and the Rhondda in the north or, most likely, to Cardiff in the south. Because of the town's position at a junction, a large volume of through traffic uses the main roads.
  The growth of the town as a residential and commercial centre is evidenced by the development there of the Newpark site. On this enclosed site has been placed a Tesco superstore and petrol filling station, a shopping precinct which is attached to the Tesco store with a precinct of smaller shops, and a CRS furniture superstore. These stores have their own car parks catering for about 500 to 600 cars with an average occupancy per day of about 400 to 500 cars. Houses have been built on the site, sheltered accommodation has been provided and there is a John Groom Association home which, as all Members will know, is a home for quite severely disabled people.
  There is one access to the site from the A473 and one main egress on to the A4119. Elsewhere in the township of Talbot Green there are a large number of other stores and a bus station which carries passengers along the main routes of travel. It is quite clear that such a busy township will have a certain amount of traffic congestion anyway, and to that congestion has been added an open air market which by a typical error in the inspector's report is described as being at Pontyclun. That open air market operates on the south-west side of Talbot Green and in recent years has added considerably to the traffic congestion.
  The market is in itself controversial, but what is beyond controversy is that it attracts customers in numbers which overwhelm its car parking facilities and the on-street car parking facilities in the immediate vicinity. On its own that market generates an extensive amount of pedestrian and vehicular traffic in the area.
  To this already volatile situation has been added a proposal to establish a second market on the Newpark site about half a mile from the existing market. Very properly, the local authority rejected that proposal on planning grounds, but the appeal against the rejection was allowed by the Welsh Office inspector. To put it mildly, his decision caused consternation, anger and outrage. It seems to the people there to be explicable only as an abandonment by the Welsh Office of its duty to help secure a balanced community and it is seen as an abandonment of the residents.
  I shall try to explain just how bad the Welsh Office decision was. The inquiry was defective both in the procedure followed for its convening and in the conclusions to be found in the report. The procedural defects were unfair to the public. People in the area immediately affected should have been given five days'
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  notice of the hearing, but no one that I have spoken to had that. A very few had two days' notice but the vast majority of people living on the site had no notice at all.
  None of the residents of Green park, Maestrisant, Llys Illtyd, Oak road, Ash walk or Cherry Tree walk was informed. Therefore, they had no chance to put in written submissions, and when one or two of them discovered the existence of the inquiry and attended and asked to be allowed to give oral evidence, they received a dusty reply from the inspector. Having thus excluded almost all the residents likely to be directly affected, the inspector arrived at wrong conclusions. That is not a mere matter of opinion, because there were errors on the face of the report and subsequent events have shown other errors in findings.
  The inspector was rightly concerned about traffic congestion and traffic flows. His theoretical calculations are impressive, but, as the late Aneurin Bevan said, why should we look in a crystal ball when we can read the book. If my constituents had been given the opportunity to give evidence, such academic calculations would have been unnecessary. If the inspector had heard from the lady who telephoned me the other Saturday to tell me that because of street parking associated with the existing market it had taken her half an hour to cover the one mile between her home and her shop in Pontyclun, he would have known that. If he had read the letter from another lady who now must allow 20 minutes extra for her journey to Tonyrefail on a Wednesday to get to work and is often late, he would have realised that and would know that, whatever the theoretical pattern of traffic, in practice traffic dislocation in this township is now very great.
  I appreciate that the Minister may well respond to that by saying that it is not too bad because the inspector has taken care to prevent the two markets from opening on the same day. In paragraph 12 of his report the inspector rules out the new market opening on a Saturday because the present one is open on that day. He describes dual opening as unacceptable and grants to the new market the opening days of Wednesday and Thursday. What he did not know or knew but overlooked is that, though the existing Yemms market then opened only on a Saturday, it had the power, if it chose to use it, to open on another day of the week. Since the report appeared it has, surprise, surprise, chosen to open on a Wednesday, and that is the reason for the extra time that my constituent must now allow to get to work.
  If the dislocation that I have described arises when one market opens on Wednesdays, it will also apply when the new market is open on Thursdays and will be double when, as is now permitted, the two markets are simultaneously open on Wednesdays. Can the House imagine the chaos, the misery and the frustration that will occur when both open air markets are decanting their customers on to the same roads on the same day and mostly at the same peak times?
  A market or markets will now be held on three days of the week and life in Talbot Green will be significantly dislocated. The effect of the ignorance or the oversight of the inspector in this vital matter renders his calculations largely valueless. His report is thereby fatally flawed. In paragraph 12 the inspector says that the existing market is to provide additional car parking, as he describes it, "to ease traffic problems". For a variety of reasons, that has not proved to be the case since the hearing. Indeed, less car

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  parking is now available than when the inquiry was held. That is another point on which the inspector's report is wrong.
  None of the parties to the inquiry could have foreseen another flaw. The appellant asserted, and it appeared to play a part in the inspector's decision, that the imminent construction of the Talbot Green bypass would halve traffic congestion in the village. Last week put paid to that assertion. The Welsh Office withdrew its grant of £8·5 million for the first year of construction of the new bypass. Also it asked whether it was necessary to build the bypass as the railway line was to be closed. Quite apart from the planning decision, that is a major blow to this area. It is a recipe for chaos. Once again, subsequent events have illustrated the unsoundness of the inspector's report.
  The major argument is not about convenience but about danger to life and health. I was born in the town that I now represent. It has had an open air market since at least the 19th century. It is enshrined in an Act of Parliament. This is not the cry, therefore, of somebody who is unused to open air markets. I am thoroughly used to them. However, it cannot be denied that open air markets in villages result in people parking in the surrounding streets, often on both sides, even though car parking is provided.
  The greater traffic flow into and out of the Newpark site for the new market means that the emergency services would be faced with a desperate problem if there were a fire on the site, or if somebody were taken seriously ill. Such incidents are even more likely where sheltered accommodation is provided. Indeed, incidents of that kind are highly likely at places like the John Groom home. There are far more emergencies to be dealt with, and the physical immobility of the residents means that they are vulnerable if there is a fire. Can it honestly be said that the inquiry took these factors into account? It contains no reference to the problem. It is a glaring omission in what I hope the Minister will agree is an unsatisfactory report.
  Any planning authority, including the Welsh Office, must pay regard to shoppers' preferences. It has an equal duty to pay regard to the preferences of the residents. It must strike a balance between shops that open on six days a week and provide services as well as goods and those which operate on only one or two days a week and who can close at short notice. If the trading activities of the shops that open six days a week are weakened, the community is weakened. That is doubly the case when a market has a maximum life of only four years.
  The inspector—an outsider and, because of procedural flaws, without knowledge of the views of local people—said that in his view the market would not weaken local traders. He could not have held that view for a moment if he had heard what local traders say. The existing market has hit trade hard on precisely the day when traders hope to do well. They will now be hard hit on two days when they hope to do well, but they will be particularly hard hit on Saturdays. Two markets would force some traders to close, while others would have to cut back.
  Who would replace those traders? To whom could the local authority look for lost rating income? Who would serve the population on Mondays and Tuesdays when trade is as much a public as a commercial service? The decision to allow a second market, even for a limited
  490
  period, would impose an intolerable strain on the community. It is the worst of decisions. The local community has not been adequately represented. The decision was based on grounds that were either wrong at the time or falsified by subsequent developments.
  In the case of opencast mining in his constituency the Secretary of State has shown that he will not allow mere commercial considerations to despoil an area. What is good enough for Pembrokeshire is good enough for Talbot Green. A fresh look at this question and at the protection that my constituents feel has been denied to them so far should now be undertaken by the Welsh Office.
  8.54 pm
  The Parliamentary Under-Secretary of State for Wales (Mr. Mark Robinson): Individual local planning applications and the decisions made on them often give rise to concern on the part of interested parties, and I fully understand the wish of the hon. Member for Pontypridd (Mr. John) to seek to raise in the House tonight the subject of recent planning decisions on Talbot Green in Mid Glamorgan which are of concern to his constituents. It is perhaps best to start by explaining to the House the background to the planning appeal that is at the centre of the issues which the hon. Gentleman has raised in the course of his speech.
  In December 1984 Excrest Ltd. applied to Taff Ely borough council, as local planning authority, for planning permission to use an area of land at Newpark, Talbot Green, Llantrisant for two days per week as an open-air market with 80 pitches.
  In a letter accompanying the application, the applicant's agent noted that the land was owned by the borough council, which had agreed to let it to Excrest, subject to planning permission being obtained. It was later explained that there was space for 220 cars to be packed, with an access point from the entry road to the district shopping centre, which includes a large Tesco supermarket. The application did not say on which two days of the week the market would open—this would be decided later.
  The local planning authority then consulted various bodies about the proposal. They received a direction of refusal from the Mid Glamorgan county engineer and surveyor in the following terms:
  "The development would result in a material increase in the volume of traffic entering routes A473 and A4119 and leaving route A473 and be detrimental to the safety and free flow of traffic using the aforementioned classified highways."
  Those familiar with the area will know that the application and the later appeal relate to an island site surrounded by the two main roads mentioned by the county engineer and the internal road serving the district shopping centre. In response to public notices, a large number of local residents wrote to the borough council expressing their opposition to the proposal. Some of them submitted a petition. Objections also came from the Tesco and Homeworld stores, which felt that very severe traffic and parking problems could occur if the permission were granted.
  After due deliberation, the borough council decided to refuse permission. The notice of refusal, which was issued on 15 April 1985, contained four reasons, the first of which gave effect to the county engineer's direction. The second and third reasons, also suggested by the county engineer,

  491
  related to lack of adequate car parking and possible danger to pedestrians. The final reason given was that the proposal was considered to be detrimental to the residential amenities of occupiers living in the vicinity of the site.
  On 29 July 1985, the applicant appealed to the Secretary of State and indicated that it wished to exercise its right to be heard by a planning inspector. On a point of procedure, I should explain that, generally speaking, appeals against a refusal of planning permission are prescribed by regulations for determination by an inspector. My right hon. Friend, of course, has the power to direct that a planning appeal should be determined by him rather than by an inspector, but that power is used sparingly, where for instance, the proposal is for significant development or development of at least regional or national importance. This appeal was not considered to come within any other criteria for recovering jurisdiction over an appeal and so it was left to an inspector to determine. The decision in such cases is the inspector's alone.
  Agreement was reached between the parties in November 1985 that a local inquiry into the appeal would be held in Pontypridd, commencing on 18 March 1986, the earliest date convenient to everyone. A Welsh Office letter to the borough council enclosed a copy of a notice of the inquiry and asked the council to give information about it to owners and occupiers of nearby property and to others who were considered by the council to be affected by the proposed development. The letter also indicated the Department's view that the press should normally be notified of local inquiries. I have no reason to believe that the council did not act accordingly. Indeed, correspondence received at this time indicated that the appeal was adequately advertised in accordance with standard procedure.
  The inquiry opened as arranged on 18 March 1986. It was resumed on 24 and 25 April and again on 8 and 9 May. A great many documents were submitted to the inspector, including a letter from the hon. Member for Pontypridd, dated 17 December 1985. I have already given the hon. Gentleman a specific assurance in correspondence that this letter was taken into account by the inspector in arriving at his decision, and I am happy to repeat that assurance now. Indeed the letter, although not specifically listed, is contained in the bundle of documents numbered 16 by the inspector in his list of documentary evidence.
  One of the matters raised in that letter was the special attention that should be paid to the needs of disabled people living at the Maestrisant home—the John Groom complex to which the hon. Gentleman has referred—a point which the hon. Gentleman came back to in his letter of 10 September 1986. In that letter, he said that he did not believe that this matter
  "was at all properly conducted and considered at the Inquiry".
  While I accept that it was not specifically referred to in the council's refusal notice or in the decision letter of the inspector, the inspector was aware of the home's existence, and had regard to it in arriving at his decision. Reference to it is contained in the documents of evidence which are part of the public record and it is, of course, covered by the general reference to concern expressed by local residents in paragraphs 9 and 20 of the inspector's letter.
  The hon. Gentleman made a further point in his second letter relating to the absence of any comment from the
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  police authority about the application. As I said to the hon. Gentleman in my letter of 6 November last, it is entirely for the local planning authority to decide who needs to be consulted at the application stage. Official advice about the display of site notices and the scope for consultation was given in Welsh Office circular 134/73, which has stood the test of time and is still Government policy. If the police authority was not aware of the application for an open-air market, I can only suggest again that the hon. Gentleman should approach the borough council for an explanation.
  At the appeal stage, a site notice was displayed and all the standard procedures were followed. As I said earlier, the council was reminded that the press should normally be notified of the arrangements for holding local inquiries. Certainly, I note that there were reporters present from two local newspapers. The inquiry was adjourned twice and, in accordance with the rules governing procedures to be followed at inquiries, the details of the reopening date and venue were announced by the inspector before each adjournment. In view of this, and the fact that the inquiry lasted for five days spread over a long period, I find it difficult to understand the suggestion that local people were not aware of it. With all this in mind, I find it hard to accept the hon. Gentleman's contention that people did not have an adequate opportunity to give evidence to the inspector.
  Another point which the hon. Gentleman made was that another market operator had decided to hold his market on a Wednesday, one of the days mentioned in the permission given to Excrest. That decision by the market operator in question, who was not party to the appeal, has no bearing on the planning merits of the matter we are considering tonight, as the observations of the inspector in this or any other case do not, of course, bind persons not a party to the applications.
  Mr. John: I apologise for interrupting; I realise that this is an Adjournment debate. That is not the point that I was making. The point I made was that the inspector specifically took account of the unwisdom of having two open-air markets on the same day and thought that he had avoided it. It now turns out that on one of the two days for which he gave permission another market is already open, so we will have the very thing that he counselled against.
  Mr. Robinson: I am sure that the hon. Gentleman will realise that inspectors hearing appeals can deal only with situations as they find them at the time. If circumstances change afterwards, that is not a matter that can lead to a reopening of an appeal decision.
  I turn now to the inspector's decision on 22 July 1986. As far as procedures are concerned, I have carefully considered the hon. Gentleman's remarks but I ant not satisfied that there is any reason to alter the view I expressed during Question Time in the House on 8 December in response to his supplementary question, which is that I am not aware of any shortcomings in the procedures which were followed in this case.
  The inspector's decision to grant planning permission for the use of this land as an open-air market for a period of four years was one for him alone to take, on the merits of the particular case. Planning legislation provides that an inspector must have regard to
  "the provisions of the development plan and to any other material considerations."

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  He must, of course, give reasons for each decision. The expression "material consideration" brings me to the question of planning policies—which are for the most part to be found in departmental circulars—and their relevance to the Excrest appeal.
  I do not propose to read out all of the reasons given by the inspector in his letter of 22 July last. That letter is a public document which has been made freely available and it has to be left to speak for itself. Any impartial observer reading the letter would, I believe, be impressed with the thorough way in which the inspector approached his task. It is apparent from the second paragraph of the decision letter that the question of access and traffic conditions at Talbot Green was one of the primary concerns of the inspector. He considered that one of the main issues was whether the additional vehicular and pedestrian traffic movements likely to be generated by the proposed open-air market would have so serious an impact on the existing traffic conditions as to warrant a refusal of planning permission.
  After weighing all the evidence on traffic and highway matters and observing the traffic flows at the site on the five days during which the inquiry was held, he formed the opinion that any increase in traffic congestion during the morning and evening peak flow periods at Talbot Green roundabout would be most undesirable and would not be in the best interests of the local community and road users. He referred to the traffic circulation pattern on the Newpark housing estate in which a home for the elderly is situated, and to the fact that the estate is served by a one-way traffic system in from the A473 Talbot road and out on to the A4119 highway. The question of access for emergency service vehicles was raised at the inquiry by both written and oral submission for consideration by the inspector in reaching his decision.
  The inspector reached his conclusion that if market trading is restricted to between the hours of 9 am and 4 pm, and was permitted only on Wednesday and Thursdays, it would not generate customer traffic that would significantly intensify the traffic problems that occurred during the peak hour flows at the Talbot Green roundabout.
  I note that there is concern about the risk of cars parking on both sides of the road but it will be seen from paragraph 5 of the inspector's decision letter that a car
  494
  park for 100 cars is proposed for market customers and that the whole of the field adjoining the proposed market stall area could be used, if required, to cater for around 220 car spaces. The use of the field for non-operational car parking has been reserved by condition No. 9 of the planning consent.
  These, then, were the inspector's conclusions on the operational aspects of the proposed development. He also dealt at some length with the implications of local and national policies. There is no time for me to go into all of these but I would draw the hon. Gentleman's attention to Welsh Office circular 38/85, which emphasises that there is always a presumption in favour of allowing applications for development, having regard to all material considerations, unless that development would cause demonstrable harm to interests of acknowledged importance. In the last analysis, each decision involves a balancing act, setting one argument against another and trying to arrive at a fair decision.
  During his speech the hon. Gentleman referred to the proposed Talbot Green bypass. I think it would be helpful if I make it clear that the Welsh Office has not reached a decision about the principle and merits of the proposal. I assure him that it will be considered for grant along with other schemes in Wales if Mid Glamorgan county council include it, as I believe it intends to, in its bid for transport supplementary grant for 1988–89.
  The hon. Gentleman has, of course, received a copy of the inspector's decision. With that letter the parties received a leaflet explaining the procedure for challenging the decision in the High Court on a point of law. The period of six weeks within which such a challenge has to be made has long expired. As I have already explained in correspondence, once a decision on an appeal has been made, neither the Secretary of State nor his inspector has any further jurisdiction.
  I have done my best in this debate to cover all the detailed points which the hon. Gentleman has gone to some trouble to raise in his remarks. I appreciate that my response does not meet his wishes but I must emphasise that this is essentially a local matter which an inspector was perfectly competent to deal with, and that even after listening very carefully to the hon. Gentleman's speech as I have done this evening, I see no justification for questioning either the inspector's judgment or his handling of the inquiry. Certainly there is no question of re-opening the inquiry or of taking action to revoke the decision.

  Drugs (Wales)
  9.9 pm
  Mr. Keith Raffan: I welcome the opportunity of this Adjournment debate to discuss the drugs crisis and particularly its Welsh dimension, a crisis which the Select Committee on Home Affairs has rightly described as
  "the most serious peace-time threat to our national well being."
  The number of drug addicts registered with the Home Office is currently rising at the rate of 25 per cent. a year, and the figure currently stands at more than 9,000. In north Wales in 1978 there were 292 offences relating to drugs, none of which involved heroin. In 1984 there were 956 such offences, half of which involved heroin.
  Even the Home Office admits that the figures for registered addicts must be multiplied by five to give an accurate and real picture. Others working in the field go as far as to claim that the figures must be mutliplied by a factor of 10 to get close to the mark. Mr. Dave Turner, the co-ordinator of the Standing Committee on Drug Abuse, estimates the total to be between 60,000 and 70,000.
  The serious problem in north Wales is worsened by the fact that the heroin epidemic has raged for five years in the Wirral area, adjacent to my constituency. The heroin problem there is second only to that in Glasgow and it is three times worse than the average for a United Kingdom borough.
  In Birkenhead—known locally as "smack city"—a quarter of 16 to 24-year-olds have some involvement with heroin, with "chasing the dragon". Other areas in Merseyside may be as little as 18 months behind the Wirral and parts of north Wales not far behind that.
  The scale of the problem is also revealed by the record number of 30,500 drug seizures by Customs and police in 1985. That figure was 8 per cent. higher than the 1984 figure, which, in its turn, was 9 per cent. up on the 1983 figure. However, and this is an extremely important point, the continuing low price and high quality of heroin shows that the available supply on the street has not been dented to any considerable extent. The rule of thumb is that for every seizure nine go undetected. The incentive for traffickers is huge in spite of the passing in the last Session of the Drug Trafficking Offences Act 1986.
  A kilo of cocaine worth £5,000 in Bolivia is worth as much as £180,000 on the streets of the United Kingdom. As if the situation is not already serious enough, my hon. Friend the Minister of State, Home Office has warned of the new threat approaching our islands, namely, the threat of cocaine. The lucrative American market for that drug is already reaching saturation point. The danger of cocaine is multiplied many fold through the use of "crack", the cheaper, more immediately powerful and more addictive form of pure cocaine.
  The drugs problem cannot be narrowly defined. It affects many Whitehall Departments: the Home Office, with its responsibility for the police, the Treasury, with its responsibility for Customs, the Department of Health and Social Security, with its responsibility for treatment, and the Department of Education and Science, with its responsibility for education. Of course, in addition, it affects the two territorial Departments, the Scottish Office and the Welsh Office.
  Two years ago the ministerial group on the misuse of drugs was set up to co-ordinate Government strategy and
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  action. That was an eminently wise decision. The Government have taken strong action to deal with the two dimensions of the problem, supply and demand. I pay tribute to the Government for their efforts to stem the supply of drugs into this country through their contribution of £3·4 million to the United Nations scheme aimed at the eradication of opium in Pakistan and its contribution of £1·5 million to reduce coca production in South America. Although there has been a sharp fall in the amount of heroin coming from Pakistan, large quantities are still coming through India.
  After the eradication at source, the second block is at our borders, first through the Customs and Excise. The Government have acted here—although they have come in for much unjustified criticism. The number of customs officers whose main priority is drug detection will by April this year be 500 up on the April 1985 figure. The number of specialist intelligence investigators in the same period will have risen from 121 to 297.
  Last year, we saw the clear success of the Government's actions with the breaking up of more than 80 trafficking gangs, most recently and perhaps most dramatically, with Operation Fulman, which broke up the Dye drug ring.
  But despite the increase in customs officers, heroin is still coming in in large quantities, mainly through freight imports rather than personal luggage, and that makes it particularly difficult to detect. Organised crime syndicates are estimated to be making more than £500 million a year from drug trafficking. With the cocaine threat looming, the Government will have to consider putting more resources into the customs service. I know that my hon. Friend the Minister of State, Home Office has given reassurances that he is keeping a close watch on the number of customs officers and will not hesitate to decide to increase them if necessary.
  The block at our borders depends not only on customs but on the police. There are only 60 on the drugs wing within the regional crime squad covering the whole of the north-west and only 10 covering North Wales. In London, where half of the country's hard drug problems are concentrated, there are only 57 officers specialising in drug offences, although that is 19 up on the 1985 total. More resources are needed. This would be an investment in the health of the nation, and we would do well to follow the example of the President of the United States and his anti-abuse programme.
  A further way to try to stem the supply of drugs is through deterrence. In the Session before last I was able to steer through the House the Controlled Drugs (Penalties) Act as a private Member's measure. It was supported by all parties, indeed by all factions within parties, including hon. Members from the Militants to the moderates in the Labour Party and from the arid dries to the saturated Wets in our party. It had universal support. That measure increased the maximum sentence for trafficking in hard drugs from 14 years to life. That was followed in the last Session by the Drug Trafficking Offences Act, which will enable the confiscation of assets of those convicted of drug trafficking.
  The effectiveness of that measure in the face of the sophistication and professionalism of the criminals trafficking in drugs, particularly in the laundering of the assets of their evil trade, depends on international co-operation. I know that my hon. Friend the Minister of State, Home Office emphasised that point when he chaired the meeting of Community Ministers on drugs misuse on

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  20 October 1986. I believe that there is a need for international co-operation beyond the confines of Europe, and I look forward to further progress on a United Nations convention.
  I have discussed in some detail past efforts and current measures by the Government to stem the supply of hard drugs, but we have to face the fact that they are still coming into the country in large quantities. The Government are also rightly trying to remove demand—this is the second dimension, after supply—and to dissuade young people from experimenting with drugs through their advertising campaign. Some £2 million was spent in 1985 on anti-heroin publicity and a further £2 million is being spent in the current financial year on the second phase of that campagn, aimed particularly at parents. I know that £200,000 of that campaign publicity money has been devoted specifically to Wales. Market research shows that the campaign is being successful. Before the campaign was started, 83 per cent. of youngsters said that they would reject an offer of heroin and now that has risen by 10 per cent. to 93 per cent.
  All this is encouraging, but there is still a need for more localised advertising campaigns. Professor Geoffrey Pearson, the professor of social work at Middlesex polytechnic, has compiled a report on drugs in the north of England, and he has questioned whether "a blanket advertising campaign" is the best way to deal with the problem. He feels that the Government's campaign should be more geared to local needs, and this has been endorsed by Dr. Howard Parker of Liverpool university, following his work in the Wirral area. I believe that there is room for a distinctly Welsh initiative to put us in the vanguard of education on drug misuse.
  During the debate on AIDS on 21 November my right hon. Friend the Secretary of State for Social Services announced the strengthening of the Health Education Council by reconstituting it as a special health authority with increased resources. This special authority will assume the current responsibilities of the Health Education Council and will be given the major executive responsibility for public education on AIDS. It will be an integral part of the National Health Service within England.
  During that debate my right hon. Friend said that the exact relationship of the new agency to health education arrangements in Wales had yet to be settled and he indicated that arrangements may vary in different parts of the United Kingdom. This gives us a great opportunity. The increased resources, the flexibility of the new health education arrangements and the tragic connection between the injection of drugs and AIDS gives us the opportunity, which I hope my hon. Friend the Minister will take, for further health education measures on drug misuse in Wales.
  Such an initiative should start in our schools with formalised drug education classes on the harmful effects of drug misuse and on the techniques of resisting what is called "peer pressure"—the pressure from older pupils who say to younger ones, "Come on, try it." That initiative must involve teachers, parent-teacher associations and the police.
  I believe that it is worth looking at the example of the United States Department of Education's campaign, "What works: schools without drugs".
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  In the United States, 72 per cent. of primary and secondary pupils now receive some sort of drugs education. One of the more comprehensive programmes is DARE, Drug Abuse Resistance Education, which was begun in Los Angeles three years ago and has since been copied in 62 school districts in the United States. The programme allows for police officers to go into schools on a regular basis for a period of 45 minutes to one hour. They go into a class, with the teacher still there, perhaps up to 17 or 18 times in the academic year.
  The education programme must be central to any attack on drug misuse. As Tom Adams, the national director of the "Just Say No" programme in the United States, has put it:
  "The kids under 10 in the States are the only group in which non-use of drugs and alcohol and tobacco is the norm."
  We, too, in Britain, must grasp the opportunity to keep that age group free of drugs as they enter the temptation-ridden teens.
  When dissuasion and prevention tragically fail, we have to fall back on treatment and rehabilitation. An extra £5 million has been allocated by the DHSS to health authorities in England from 1986 to expand the treatment of drug misuse. That is on top of the £17 million already available for local projects such as telephone help lines and counselling services.
  I hope that when the Minister replies he can give the comparable figures for Wales. I must confess to being unhappy about the way in which the Government are funding treatment and rehabilitation in Wales at present. In England and Scotland, short-term pump-priming funds have been established, but not in Wales. Instead, the Welsh Office has extended the scope of existing funds for developments in mental health care provided through the NHS to embrace schemes to combat misuse of drugs.
  That has aroused the suspicion of health authorities that it is not new money which is being made available but diverted money. I know that the Government have taken the extra scope into consideration and increased the fund from £1 million to £1·5 million, but only £215,000 of that has been specifically allocated for drug misuse. In 1985 in England and Scotland the figures were significantly higher—£6 million and £2 million respectively.
  I agree strongly with the Government that primary responsibility for the provision and development of treatment and rehabilitation services must remain at local level. Health authorities will be willing to develop such services if they are given central funding, but they are less willing, almost unwilling, to give priority to combating drug misuse in competition with other local priorities. The Welsh Office should reconsider the funding of drug treatment within the Principality.
  In conclusion, William Jones once said:
  "The deadliest enemies of nations are not their foreign foes; they always dwell within their own borders."
  Drug misuse is the most insidious, all-pervasive, of enemies. It knows no boundaries of class or geography. It is no longer an inner city, a city, an urban, or even a suburban problem; it is prevalent throughout our villages and countryside.
  As Brian Arbery, chief executive of the charity Turning Point which runs the Hungerford drug project, says:
  "The current Government has done far more than any other in giving money and high priority to dealing with drug abuse".
  This debate follows on from yesterday afternoon's debate and it is worth pointing out, sadly in the absence of any

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  Opposition Members, that the Government have once again been in the vanguard of dealing with this national crisis, just as they have been in the vanguard of helping old-age pensioners in the severely cold weather that we have experienced of late. That has already proved that this Government is a caring Government.
  Sadly—the Minister may agree with me—the Government sometimes fall short on presentation of what they are doing. That is an understandable mistake because we are doing so much, but we must broadcast what we have done even more. I hope that I can count on the Minister's support in doing that, particularly in the Principality. If we can get the message across, we shall show, as Lord Woolton once said of another Conservative Government: "We not only cope; we care." I know that the Minister may follow that last point in his opening sentence, but I hope that he will also acknowledge, perhaps as a conditional clause of that opening sentence, that he recognises, as I recognise, that if we are to defeat this deadliest of enemies still more must be done.
  9.26 pm
  The Parliamentary Under-Secretary of State for Wales (Mr. Mark Robinson): I welcome the fact that my hon. Friend the Member for Delyn (Mr. Raffan) has called this debate tonight. He has gone to considerable lengths and trouble to address the House and to draw attention to an important subject. I particularly welcome the initiative because I share his and the public's concern that new threats to public health do not deflect our determination to defeat the racketeers and pushers.
  At the same time, we must do all in our power to help those suffering from drug misuse and those who are in danger or being ensnared by it. That resolve remains undiminished in Wales, as in the rest of the United Kingdom. The effort that forms part of the overall strategy that is not within my departmental responsibilities is nevertheless of direct benefit to Wales, particularly in reducing supplies and thereby protecting our people from its evils.
  My hon. Friend referred to the work of the inter-ministerial group on the misuse of drugs under the chairmanship of my hon. Friend the Minister of State, Home Office. I serve on that group and its work is challenging and extremely important. The work we do in Wales is in the context of the overall strategy co-ordinated by my hon. Friend and I am closely involved in it. There is a comprehensive and developing Government strategy aimed at reducing supplies, improving international action against traffickers, stepping up deterrence, improving the security of illicit drugs and assisting prevention and treatment.
  The Welsh Office's place in that relates to health education, treatment, rehabilitation and the security of drugs. Notably, the Department has participated fully in the national public information and education campaign, including the production of media material and leaflets in the Welsh language as well as in English which have been widely distributed to parents and young people. Extensive video training and education aids, for example, have been distributed to professional workers and schools, a high proportion of whom have accepted a free copy of the double tape video.
  Those national educational activities have greatly assisted specific Welsh Office action which takes the following forms. First, at the Welsh Office's request, each
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  county in Wales now has an active drugs advisory committee led by the local district health authority and composed of all the statutory professional and voluntary groups interested in combating drug misuse. The Department has kept in close touch with those committees and my impression is that for the most part they are working well together, particularly in Clwyd under the chairmanship of Michael Griffith.
  Local planning is the second important aspect. Each drug advisory committee has been asked by the Welsh Office to produce a strategic plan for tackling drug misuse in each county. All plans have been submitted in draft and the Welsh Office has produced detailed comments on each. The counties are now in the process of preparing final versions and my right hon. Friend the Secretary of State will be able to provide a firm basis for concerted local action over the next three to five years.
  My hon. Friend the Member for Delyn referred to improved educational resources, and in the current financial year and the next some £150,000 will be made available to each county in Wales. With regard to health education, the Welsh Office has funded the appointment in each county of a health education officer specialising in drug misuse. They will be encouraging activities in the community aimed at alerting young people to the dangers of drug misuse.
  A significant investment has been made in providing advice, guidance and counselling to people suffeing from or in danger of drug misuse. Particular initiatives include centres at Swansea, Bangor, Bridgend, Cardiff and Newport.
  As regards treatment, the emphasis has been on education and counselling. In the years ahead, one can expect the development of clinical treatment facilities. Community drug teams have been established, with Welsh Office funding, in Clwyd and Cardiff and they are the out-patient arms of hospital services.
  We attach great importance to crisis intervention. We are concerned to provide easy access to help for those people and their relatives and friends who experience a drug misuse crisis. Welsh Office funding has enabled a nationwide Welsh drugs line to operate 24 hours a day. It reaches out to every town, village and hamlet. Although it is still in its early stages, the drugs line handles some 200 calls a month from all over Wales.
  We believe that the voluntary sector complements the work of the statutory authorities. It is often in the best position to cater for the needs of drug misusers. In virtually every county the Welsh Office has funded the provision of voluntary sector services. In that regard, the leadership shown by the churches in north Wales and their work with the statutory authorities is especially encouraging. They are being helped by the Department.
  All these developments are important in the context of national co-ordination. It is important to ensure that each drugs advisory committee shares its experiences—that is helpful in providing services—and that they co-operate to solve mutual problems. It is also important to ensure that the Welsh Office is well briefed on the experiences and views of those working in the field. Service planners must have ready access to information on Government initiatives.
  All those functions are performed by the Welsh committee on drug misuse that met for the first time last month and I was pleased to attend that meeting. The committee is chaired by Dr. John Evans. It has a wide and

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  expert membership, including the secretaries of the Clwyd drug advisory committee and the Clwyd council on drug misuse.
  My hon. Friend the Member for Delyn went to considerable length to talk about funding. The comprehensive range of initiatives has relied upon the energy and commitment of a relatively small number of people in each county, and I should like to pay tribute to the effort that they have made. Their work has been made possible by the considerable financial investment from the Welsh Office. As my hon. Friend pointed out, in the past two financial years, the Department has spent almost £1·5 million on national and local initiatives. Much of that money has enabled local services to be provided that are of direct help to drug misusers, their families and friends.
  The Department's commitment will continue. Currently we are considering further requests for the
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  funding of local projects, including schemes in Clwyd. I hope to make an announcement about that when the detailed appraisal has been completed and the Welsh committee on drug misuse has been consulted.
  In addition to training and information material for teachers, parents and pupils, the Welsh Office has made available £150,000 from the education support grant in 1986–87 and 1987–88 for the appointment of a special adviser on drug misuse in each county. They will be encouraging and assisting the work of teachers in schools.
  I assure the House and my hon. Friend that the Welsh Office remains fully committed to the Government's fight against drug misuse. It is working closely with a wide range of service providers to ensure that young people and their parents are aware of drug misuse and that those entrapped by this evil are given the help that they need and deserve.
  Question put and agreed to.
  Adjourned accordingly at twenty-six minutes to Ten o'clock.

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Preamble
The House met at three of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Derby.

Air Transport: EC Internal Market
Baroness Burton of Coventry: My Lords, I beg leave to ask the Question standing in my name on the Order paper.
The Question was as follows:
To ask Her Majesty's Government whether they will make a Statement on any decisions taken at the meeting of EC Transport Ministers on 15th December affecting European air fares.
The Parliamentary Under-Secretary of State, Department of Transport (Lord Brabazon of Tara): My Lords, as my noble friend explained to the noble Baroness on 17th December, a majority of states supported our proposals for the content of a three-year first step towards full liberalisation by 1992. Only two states remained totally opposed to our ideas for making cheap fares more widely available. We have assured the new Belgian presidency of our full support in finalising agreement of our package.
Baroness Burton of Coventry: Yes, my Lords, but that does not deal with the Question on the Order Paper, which asks what happened at the meeting of Transport Ministers on 15th December. However, perhaps when the noble Lord replies to my supplementary questions he can remedy that.
May I ask additionally what steps the European Commission has taken following receipt of replies from 10 European airlines and whether all these have now been received? Is it correct that British Caledonian has been removed from the list? If so, I am very glad. However, can the Minister tell the House the reason for that so that other airlines can profit from the information.
Lord Brabazon of Tara: My Lords, in answer to the first Question of the noble Baroness, the Council secretariat did issue a press release reproducing my right honourable friend's summing up at the December Council. That press release was made available throughout the Community and I understand that copies are available in the Library. As regards the action of the Commission against the 10 airlines, I am not at present aware of the current state of progress in that matter. It is a matter for the Commission. However, I do understand that British Caledonian was removed from that list.
Baroness Burton of Coventry: My Lords, that has not advanced us at all. First, may I thank the Minister for sending me a copy of the report to which he referred? However, surely he should know whether the Commission has taken any action. That is what is
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wrong; we never can find out who has done what. Furthermore, may I ask whether the Minister can tell us why British Caledonian has had the good fortune—and, I think, the justification—of having its name withdrawn from that list?
Lord Brabazon of Tara: My Lords, I am afraid that I do not have the answer to that question. I shall look into the matter and write to the noble Baroness.
The Earl of Lauderdale: My Lords, can my noble friend say which two countries are opposed to the proposition?
Lord Brabazon of Tara: My Lords, no, not the two countries with which we ended up and to which I referred in my original Answer. I do not know which they were.
Lord Underhill: My Lords, the question which has just been asked is one that I was going to ask. I note that in the reply to the noble Baroness given by the noble Viscount, Lord Davidson, on 17th December reference was made to the fact that seven states completely support the views of the Government on cheaper fares and that only two are totally opposed. Surely the noble Viscount knew the two countries then and surely the noble Lord must know them now. What are the two countries?
Lord Brabazon of Tara: My Lords, I have already said that I do not know at the moment. I shall certainly find out which they are and write to the noble Lord.
Baroness Burton of Coventry: My Lords, I have no wish to be rude to the Minister but I think that he should know when questions are put down on the Order Paper. I am not at all amused and I am getting rather tired of it. Is it not right that whoever provides the brief for the Minister should take the trouble to see what replies are likely to be necessary? As he has just told the House that he does not know about British Caledonian, does not know the reason and does not know the action which the Commission has taken, we have gleaned no information at all. Is he further aware that a letter to me on that subject will not satisfy me and that I proposed to put down the same Question a few weeks hence when he will perhaps know the answer?
Lord Brabazon of Tara: My Lords, as I said originally, that was a matter for the Commission. I am now in a position to tell noble Lords that the two countries which totally oppose us are Spain and Portugal.

Waterloo and City Line Service
3.9 p.m.
The Earl of Buchan: 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 when, following the scheme they supported for capital expenditure on Network SouthEast, travellers on "The Drain" (the railway from Waterloo to the Bank) can expect an improved service.
Lord Brabazon of Tara: My Lords, British Rail is preparing plans for new rolling stock and signalling equipment for the Waterloo and City Line. We hope to have its proposals later this year. I am sure this investment will significantly improve the quality of service for rail passengers.
The Earl of Buchan: My Lords, I thank the noble Lord for that most encouraging reply, bearing in mind that the last letter I had from British Rail said that there was no money for rolling stock or new equipment.

Dental Services for the Armed Forces
Lord Graham of Edmonton: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will make a statement on the future organisation of dental services for the armed forces.
The Minister of State, Scottish Office (Lord Glenarthur): My Lords, as a result of a recent trial we have concluded that the main requirement for the provision of dental appliances should be met by commercial laboratories, while a certain number of uniformed dental technicians should be retained to meet an important war role. Twenty-two civilian dental technicians were therefore informed on 7th October that they were to be made redundant, although special efforts are being made to find them alternative jobs in other specialisations.
Lord Graham of Edmonton: My Lords, I thank the Minister for that reply. However, is he aware that the trade unions concerned—namely, the IPCS and USDAW—have received representations from their members stating that the savings which are alleged to be made in the proposals are not cost-effective and will result in a diminution in the quality of the service? Why have the Government refused to allow sight of this trial report to those who are most affected—the dental technicians who have been dismissed as a result of a review in which they were not involved and who were not consulted about the matter during its compilation?
Lord Glenarthur: My Lords, the important point is that the review was extremely thorough. It covered some 6,500 cases, and an analysis of the results confirmed that commercial laboratories could undertake the main tasks with a reduction in overall costs. It is important that in matters such as this costs are carefully scrutinised.
Lord Graham of Edmonton: My Lords, do we not have the worst of all worlds? There is to be a traumatic change, allegedly to save public money, but it will cost more, and there is no evidence to back up the need for it. The Minister has seen the evidence. The trial report has been produced but those who are affected have not seen it. Is the Minister aware that I have details in my possession, as he must have, of eight of the individuals
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who are affected and have been dismissed? They have a total of 101 years of service in uniform and collectively 116 years service as dental technicians. Many of them rendered relief to the wounded in the Falklands. Is it not a disgrace that such individuals are treated in this way? Is the Minister aware of the case of a Mr. B. Finch, who has given a total of 32 years' public service? He tells me that the warrant officer who will replace him will cost £20,000 in capitation, while his salary is only £10,000, and his replacement will have service commitments as well. Will the Minister be prepared at least to consider making the report available to convince those who are losing their jobs in this disgraceful way?
Lord Glenarthur: My Lords, no one disputes the valuable service to the Armed Forces which these people have provided. I am afraid that I cannot go into individual cases now, but I think that the operational needs of the service must remain paramount, and putting out this work to contract, which effectively is what has been done, was the cheapest option. As I said, the operational requirement dictated that 92 uniformed technicians had to be retained to meet identified war appointments in medical support. There is therefore no basis for a reconsideration of the case of these civilian dental technicians.
Lord Graham of Edmonton: My Lords, will the Minister tell us whether he has the view of the heads of the three services and of the people involved in dentistry? I wonder whether they actually wanted this change, or has the whole motivation for it simply been one of reducing public costs and, more importantly, reducing the size of the role of civil servants?
Lord Glenarthur: My Lords, as I said, the trial was to see whether or not the work could be done more effectively and cheaply in another way. What has come out of the working party report is that it can be done better and more cheaply in the way that is being suggested. The important point to bear in mind is that some uniformed dental technicians will need to be retained because of the war role.

Business
3.15 p.m.
Lord Denham: My Lords, at a convenient moment after four o'clock this afternoon, my noble friend Lord Lucas of Chilworth will, with the leave of the House, repeat in the form of a Statement an Answer to a Private Notice Question that is to be made in another place on the investigations into Guinness.

Territorial Sea Bill [H.L.]
The Minister of State, Foreign and Commonwealth Office, (Baroness Young): My Lords, I beg to introduce a Bill to provide for the extent of the territorial sea adjacent to the British islands. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—
(Baroness Young.)
On Question, Bill read a first time, and to be printed.

London Underground (Goodge Street) Bill [H.L.]
Read a third time, and passed, and sent to the Commons.

Business of the House
The Lord President of the Council (Viscount Whitelaw): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the debates on the Motions in the names of the Lord Bottomley and the Lord John-Mackie set down for 21st January shall each be limited to 2½ hours and that Standing Order 35 and paragraphs 10 to 13 of the Rules for the Conduct of Short Debates shall apply to each debate.—(Viscount Whitelaw.)
On Question, Motion agreed to.

Family Law Reform Bill [H.L.]
3.17 p.m.
Report received.
Clause 1 [Parents not being married to have no effect in law on relationships]:
The Lord Chancellor (Lord Hailsham of Saint Marylebone)The Lord Chancellor (Lord Hailsham of Saint Marylebone) moved Amendment No. 1:
Page 1, line 11, leave out from ("appears") to ("who") in line 15 and insert ("—

(a) references to a person whose father and mother were married to each other at the time of his birth include; and

(b) references to a person whose father and mother were not married to each other at the time of his birth do not include,

references to any person to whom subsection (2A) below applies, and cognate references shall be construed accordingly.
(2A) This subsection applies to any person").
The noble and learned Lord said: My Lords, perhaps I may speak to this and the following amendment together. They arise out of a suggestion made by my noble and learned friend Lord Brightman from the Cross-Benches when we discussed the clause in Committee. The amendments split the present Clause 1(2) into two separate provisions. In no way, I am advised, do they alter the effect of the subsection but they may make it easier to comprehend. I beg to move.
Lord Kilbracken: My Lords, I feel that this amendment is an improvement on the existing subsection because it makes it easier to understand. I should like to take the opportunity to point out that in my opinion it has a couple of defects which were already in the Bill and which it has not eliminated. As I understand it, this subsection is operational only if the father of the child dies before birth takes place.
The two points I want to make are these. First, if we look at subsection (3), either as it is now or as it would be if Amendment No. 3 were agreed, we see that references to the time of a person's birth are to be taken to include any time during the relevant gestation. However, this extension of meaning must be taken into account not only when the time of birth is
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mentioned in paragraph (a) but also when it is mentioned in paragraph (b). I am sorry; I should not have referred to paragraphs (a) and (b) but should have said in,
"references to a person whose father and mother were married to each other",
and,
"references to a person whose father and mother were not married to each other."
In the former case this clearly means that a couple who married at any time during the gestation are to be regarded, if the father dies before the child is born, as having been married at the time of the child's birth. But by precisely the same token, if we apply the extension of meaning required by subsection (2) to the,
"references to a person whose father and mother were not married to each other at the time of his birth"
we find that the same couple are to be regarded as not having been married at the time of birth because they were not married for that part of the gestation that preceded their marriage, however long or short it may have been.
That is because under subsection (3) the time of birth is taken to include any time during the part of the gestation when they were unmarried as well as the remaining gestation when they were married. They must therefore be considered to have been both married and unmarried at the same time.
My second point is that subsection (3), in both versions, is said to be solely and specifically for the purpose of construing references falling within subsection (2). However, it will be seen that subsection (2) relates only to the position under the Bill, and future enactments, of legitimated or adopted persons who are, incidentally, most unlikely to have been affected by the death of the father during gestation. On my reading of it, therefore, subsection (3) does not extend the meaning of the words "the time of his birth" in all the many other passages where they occur in the Bill; and surely they are intended to.
The Lord Chancellor: My Lords, I was given no advance notice of this matter. I am instructed, and believe, that the amendment to which I am speaking does not alter the sense of the Bill as it stands. I will look into what the noble Lord said and see the draftsman's comments on it. That is the best I can do in the circumstances.
Lord Kilbracken: My Lords, before the noble and learned Lord sits down, may I say that about 10 days ago I gave notice of this matter to an official in his department.
The Lord Chancellor: My Lords, I can only say that I am rather puzzled, but I will do as I promised to do.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 2:
Page 1, leave out line 23.
The noble and learned Lord said: My Lords, this is part of the same subject, and I therefore beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 3:
Page 2, line 3, leave out from ("period") to end of line 5 and insert ("beginning with—

(a) the insemination resulting in his birth; or

(b) where there was no such insemination, his conception, and (in either case) ending with his birth").

The noble and learned Lord said: My Lords, again, this is basically a drafting amendment and does not alter the effect of Clause 1(3). It is intended to meet two criticisms of the drafting made in Committee.
The first criticism, voiced on the Cross-Benches by my noble and learned friend Lord Simon, was that it is uncertain whether the provision covered the case of fertilisation in vitro. Such a case was intended to be covered and the amendment makes the position clear because as it is now drafted conception without insemination can only refer to the creation in a test tube. The second criticism was that the period of time referred to in Clause 1(3) should be framed in chronological order; that is, in time beginning with the moment of insemination and ending with the child's birth. That is effected by the amendment and I ask your Lordships to accept the amendment for those reasons. I beg to move.
Lord Kilbracken: My Lords, your Lordships will
notice that my Amendment No. 4 seeks to amend the same passage as would be amended by Amendment No. 3. I should therefore like to consider both amendments together with Amendment No. 5, which goes hand in glove with Amendment No. 4, in the hope that I will convince your Lordships, however optimistic that might be, that my own amendment is preferable.
The first point to which I draw your Lordships' attention is the use of the word "insemination" in the amendment tabled by the noble and learned Lord. It is true that "insemination" means the injection of semen or seed and therefore it is perfectly correct to talk about the normal act of intercourse that takes place between a husband and wife—unless the husband is fashionable and wears a condom—as an insemination.
However, I have searched the statutes via Lexis in the Library and I find that there is no previous use in any statute of the word "insemination" in this instance. The word frequently occurs when it is "artificial insemination" and usually refers to cattle and pigs. If "insemination" is used without the word "artificial" it is because someone has been careless and left it out. When I first read the amendment I thought that the noble and learned Lord was actually referring to artificial insemination, and of course that did not make much sense. I find that the use here of the word "insemination", however correct technically, is a little misleading.
Secondly, it is clear that this amendment is intended to cover cases of in vitro fertilisation. I agree with the noble and learned Lord the Lord Chancellor that it is desirable that cases where fertilisation takes place in vitro should be considered in this Bill without waiting for the Warnock Report because there will be a time-lag between consideration of the report and subsequent legislation. In the meantime, the provisions as laid down by this Bill, however they may he interpreted, are the ones that will be operative.
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The important thing to bear in mind with in vitro fertilisation, and what makes it different from any kind of impregnation, is that theoretically there may be an indefinite delay of many years between the fertilisation of the ova in vitro—that is, in the dish in the hospital—and their subsequent implantation in the womb. The fertilised ova may be put in the deep freeze and removed from it at any future date and inserted in the uterus of the woman. In the interval between conception (because conception takes place in the dish at the moment when the egg is fertilised) and birth, the husband who provided the semen may have died and the wife who may have remarried and have had several children by her second husband may well think, "Well, Tom was not such a bad old fellow and I think I shall now have another of his children". So she has the frozen ova thawed, and whether or not her second marriage is still continuing she can have herself implanted with ova that were fertilised by her first, long dead husband.
Under the amendment of the noble and learned Lord the Lord Chancellor the child resulting from such an implantation would still be regarded as one whose biological father and mother (the first husband and the wife) were married to each other at the time of its birth because conception took place in vitro at the time they were married all those years before. Yet the father is long since dead and buried and the mother may be married to someone else and perhaps has children by him. I suggest that my amendments will avoid those problems.
Amendment No. 4 is the same amendment that I tabled at Committee stage. It would cut out all the details in Amendment No. 3 and simply substitute:
" between his conception and birth".
That amendment was not accepted by the noble and learned Lord, the Lord Chancellor, the only reason being a suggestion of the possibility that the father dies between the time of intercourse and the time of conception. There is always a short delay, and there may be a delay of two or three days between intercourse and conception. This, if I may so maintain, is a completely irrelevant objection. One cannot imagine any circumstance in which, should a child be born a certain length of time after the father's death, anyone could possibly know, or would ever think of suggesting, that the father had died before conception had taken place. There is no way in which that could be established except perhaps under laboratory conditions and no one would ever dream of suggesting it. If the child were a couple of days late it would just be said, "Well, the gestatory period was a couple of days longer than usual." It would never be suggested that there were a couple of days' delay before the child was conceived.
I would therefore maintain that, in this case, it is only necessary to have the simple words:
"between his conception and birth".
That is why I shall he moving my amendment as an alternative to the amendment of the noble and learned Lord.
3.30 p.m.
Lord Renton: My Lords, I welcome Amendment No. 3. I think that I was the first to suggest that we

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should not have things in the wrong chronological order. The amendment of the noble and learned Lord the Lord Chancellor has put the matter right in that respect. However, it is significant that he has not referred again to "intercourse" but has preferred to use the word "insemination". I am sure that that word is appropriate, although, as I understand the matter, there could be intercourse without insemination. However, it is insemination that matters, and therefore the amendment seems to me to be right.
I shall not speak to the amendment to which the noble Lord, Lord Kilbracken, has referred, although I shall be interested to hear what the noble and learned Lord the Lord Chancellor has to say about it. Because of the manner in which the noble and learned Lord kept me informed, I believe that the House should be grateful to him. He has taken an immense amount of trouble to try to get this rather complicated Bill right. Even if one finds it difficult to follow some of the abstruse scientific factors which arise, nevertheless we should be grateful to him.
Lord Campbell of Alloway: My Lords, I should—
Lord Simon of Glaisdale: My Lords, I apologise to the noble Lord for interrupting, but he was on my blind side. Perhaps I may be allowed to make four points. The first, of course, is to thank my noble and learned friend on the Woolsack for meeting the point to which I have drawn attention. It was certainly in doubt as to whether fertilisation. in vitro was covered. Anyone reading the original draft would probably have concluded that it was not covered.
My second point concerns a purely typographical matter. The last words:
"and (in either case) ending with his birth"
are typographically in the wrong place. They were in the right place in the letter that was written on behalf of my noble and learned friend to the noble Lord, Lord Kilbracken, a copy of which was courteously sent to me. It is a matter that the draftsman himself puts right automatically before the next printing, and I merely draw attention to it for that purpose.
As to specific terms, we have not heard from my noble and learned friend on Amendments Nos. 4 and 5 of the noble Lord, Lord Kilbracken. But, subject to what he has to say, I must confess that I prefer the way in which the noble Lord, Lord Kilbracken, deals with the matter to Amendment No. 3. The short reason is that Amendment No. 3 uses the words "insemination" and "conception" in a way in which they are not generally used. The word "insemination" is normally limited to artificial insemination, but in paragraph (a) it is obviously intended to cover both artificial insemination and normal intercourse. It is because it does so that "conception" covers fertilisation in vitro.
Of course, when one talks of conception, the normal sense is that of conception in the womb—fertilisation in the womb. That is the way the dictionaries deal with the word and it has a strong and beautiful Biblical overtone. So, although I certainly do not oppose this amendment, I hope that my noble and learned friend will keep an open mind about the drafting. As I said, subject to what he has to say, I prefer Amendments Nos. 4 and 5.
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My last point is that on the Motion in Committee that the clause should stand part of the Bill, the noble Lord, Lord Renton, drew attention to the fact that Clause 1(1) carried out an intention of the Renton Committee that there should be drafting in general terms. When I came to speak in the debate I drew attention to the evidence that had been submitted to the Renton Committee by my noble and learned friend the Lord President of the Court of Session and my noble and learned friend Lord Wheatley, who was then Lord Justice Clerk. It provides a good example of what they pointed out and it was endorsed by the Renton Report, paragraph 6.5 of which states:
"Most of the problems encountered by the courts flow directly from the tendency of Parliament to ignore the virtue of enacting broad general rules in which the principle and overriding intention can be readily seen, and to try to legislate in principle for particular aspects of mischief which presumably the statute is intended to curb. It is an eternal truth"—
say my two noble and learned friends—
"that one can seldom foresee every combination of circumstances which may arise".
My feeling is that the draftsman did not envisage sufficiently fertilisation in vitro. That demonstrates the advantage of taking the advice of the Renton Committee which is so constantly flouted; namely, instead of trying to deal with a number of particular foreseen instances, to draft in broad terms.
Lord Campbell of Alloway: My Lords, I wholly support Amendment No. 3, paragraph (a),
"insemination resulting in his birth".
I am puzzled and, with respect, seek some clarification, in the meaning of "conception" in paragraph (b). In this I would wish to share in the tribute already paid to the noble Lord, Lord Kilbracken, and to share some of the misgivings of the noble and learned Lord, Lord Simon of Glaisdale.
I hope that it is in order to speak to Amendment No. 5 which has been spoken to and which is clearly affected by this amendment. As I understand the position, under the Legitimacy Act a child may not be legitimised if both parents knew at the time of intercourse that the marriage was void. That relates to the intercourse resulting in birth. The Legitimacy Act obviously did not take on board the question of in vitro fertilisation.
It appears again, with the qualification, as I understand the position, that ova are fertilised in vitro; that they may be put in a type of freezer and then subsequently implanted in the womb. Your Lordships may well think that the crucial point is the time when such implant results in birth. That is the relevant concept, and is, I think, with respect to the noble and learned Lord the Lord Chancellor, the meaning of "insemination" in paragraph (b).
It is at such time—the time of the implant—that knowledge of either parent that the marriage is void should prevent legitimacy under the Legitimacy Act, because there may be years between conception in vitro—in the dish, or whatever it is—and the time of the implant. Neither parent may know that the marriage is void at the time of conception in the dish but they may well so know years later at the time of the implant which results in birth.

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I therefore genuinely seek clarification and assistance on that point. I support the spirit of the amendment moved by the noble Lord, Lord Kilbracken, as I understand it, because it seems to take into account the crucial point of in vitro fertilisation with reference to the relevant time without any ambiguity, a matter with which the 1976 Act was not concerned but with which your Lordships are now concerned.
The use of the word "conception" where there is no act of intercourse, as appears in paragraph (b), may not be—I say this guardedly—wholly satisfactory, as it is understood that medically and technically conception takes place when the ova are fertilised in vitro and not when the implant in the womb which results in birth is made.
The Lord Bishop of Birmingham: My Lords, before the noble Lord sits down, may I ask him whether he is aware of the new technique commonly known as GIFT, whereby an ovum is fertilized in the fallopian tube and not in vitro? That is a technique which is rapidly gaining ground, and it would not therefore be fully correct to speak of the embryo in cases of assisted insemination always being formed in vitro.
Lord Campbell of Alloway: My Lords, with the leave of the House, may I admit that I was unaware of that matter? I am most grateful to the right reverend Prelate for having drawn it to my attention. I do not think that it wholly disposes of the problem on which I was seeking some clarification. I agree that it is another aspect of the matter. As I understand the position—this is an overall qualification because I am no expert—I do not think that it disposes of it.
3.45 p.m.
Lord Kilbracken: My Lords, before the noble Lord finally resumes his seat, may I ask him whether he is aware that I have not yet spoken, or do not regard myself as having spoken, to Amendment No. 5 on the meaning of the word "conception", and that I intend to do so when that amendment is called?
Lord Hylton: My Lords, it seems clear that we are trying to navigate in deep and complicated waters. Modern technology has opened up possibilities which fly in the face of received ideas of family life. Reference has already been made to cold storage. All those things point us forward along the list of amendments to Amendment No. 20 in the name of the noble and learned Lord, Lord Denning, and Amendment No. 22 in the name of the right reverend Prelate the Bishop of Birmingham.
The Lord Chancellor: My Lords, if noble Lords have all quite finished I shall do my best to deal with the points that have been raised. First, I was going to deal with the rather complicated point raised by my noble friend Lord Campbell of Alloway when we came to Amendment No. 23, when I hope to give him and possibly even the noble Lord, Lord Kilbracken, satisfaction. I was going to say, if the House will permit me to do so, that there is now a defect in Clause 28. If when he comes to move Amendment No. 23 the noble Lord were to withdraw it at my request, I will put right
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that point on Third Reading. It is a rather technical point. On the whole, I should prefer to deal with it in that way.
I do not know that I followed everything that the noble Lord, Lord Kilbracken, was saying. However, I am advised by my noble friend who sits quietly on the Bishops' Bench, at the moment below the right reverend Prelate the Bishop of Birmingham, that if I succeed in persuading your Lordships for the time being to accept Amendment No. 3 I shall not be able to call Amendment No. 4. But there is a basic objection to Amendment No. 4 when and if it were to be considered. That is that when we debated precisely the same amendment in Committee the argument revolved, possibly naturally at that time, around the maximum time between the relevant act of intercourse in what I might call the good old-fashioned way of engendering children and the actual moment at which the two gametes come together. I was then able to tell noble Lords that the maximum time might be as much as 48 hours and, in extreme cases, even 72 hours. This was a matter with which all your Lordships except me were already familiar.
Lord Simon of Glaisdale: My Lords, would the noble and learned Lord allow me—
The Lord Chancellor: My Lords, no, not at this moment. Let me finish a sentence.
Lord Simon of Glaisdale: My Lords, I am sorry.
The Lord Chancellor: My Lords, let me finish a sentence and then I shall give way because I have to explain a rather difficult point and I cannot take more than one at a time. I am sorry to be so firm with my noble and learned friend.
Unfortunately I have discovered yet a further fact about these matters, and I confine myself at the moment to what I have called the old-fashioned way of engendering children. To my astonishment—and as I grow older, as the poet Solon said, I learn more and more—there is a minimum time between the act of intercourse before which conception cannot take place—I can see that the right reverend Prelate is better informed than I was until I read my brief yesterday—which is about six hours from the act of intercourse.
If I were to accept Amendment No. 4 on its merits a situation might arise which does not apply in the rather complicated cold-storage system which the noble Lord has unveiled to the House but in the ordinary course. There is a minimum time of six hours between intercourse and conception. Suppose that a husband dies in that minimum time. The child would be rendered illegitimate if Amendment No. 4 were accepted. This is a fatal objection to that form of words.
The fact of the matter is that on these rather recondite matters I am a relatively simple person. I do not think that we need worry too much about the situation which might arise if the united cells were put in cold storage for a number of years. I think that perhaps that is too unlikely a set of circumstances to envisage. We have to get this as right as we can at the present time. At a later stage there will certainly be

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further time to consider the situation. I shall of course consider everything that my noble and learned friend and other noble Lords have said. However, at the moment I am sticking to Amendment No. 3 as the best way through the maze at the present stage, with the promise which I have contingently given of a change to Clause 28 when Amendment No. 23 comes up for consideration.
I am afraid that I took more than one sentence to say all that. I now very willingly give way to my noble and learned friend on the Cross-Benches, who had a separate point to make.
Lord Simon of Glaisdale: My Lords, I must apologise to my noble and learned friend for interrupting him when he was in full flow. The point I wanted to raise at the time was on his argument about the delay in fertilisation between the act of intercourse and the fertilisation of the egg. My noble and learned friend said that it might be 48 hours. He said in Committee that it might even be 72 hours. Would that not merely mean that the child was three days late and the law would unhesitatingly presume it to have been conceived in wedlock?
The Lord Chancellor: My Lords, my noble and learned friend with his special experience is almost certainly right, but I referred to the possibility of 72 hours again a moment ago. I was pointing out that there is not only a maximum period after the act of intercourse; there is also a minimum period. This was what rendered the prospective Amendment No. 4 an unsuitable vehicle for changing the Bill.
I suggest that the best plan is for me to reflect upon the various rather complicated sets of circumstances which have been put forward by those who are better informed than me and to see whether any change in the Bill is recommended as a result. In the meantime, I am sticking to Amendment No. 3. It does two things which seem to me to be very much needed and no one has really challenged that it makes these provisions. First, it makes it clear that the Bill is intended to cover in vitro fertilisation. Secondly, it puts right the defect in draftsmanship to which my noble friend Lord Renton drew attention in Committee. I think therefore that the House could be quite safe in accepting this, subject to my undertaking, first, to alter Clause 28 when we come to Amendment No. 23, if we do, and also subject to further consideration of the rather complicated methods of engendering children to which we are being introduced stage by stage.
Lord Kilbracken: My Lords, before the noble and learned Lord sits down—I have to put it in that way—may I ask him this? Will he agree, in view of the fact that I do not have the right to speak now—and quite a lot has been said about my Amendments Nos. 4 and 5—that if his amendment is agreed I shall be able to speak again briefly to my Amendments Nos. 4 and 5 when they are called after the acceptance of his amendment?
The Lord Chancellor: My Lords, if my Amendment No. 3 is accepted the noble Lord will not be able to talk on Amendment No 4. It is not possible—so my noble
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friend advises me—to call Amendment No. 4 if Amendment No. 3 is accepted. Amendment No. 5 is only another way of putting the provisions in Amendment No. 3. I fancy that the same applies to that, and I am so advised.
I think that the best plan is to let Amendment No. 3 go through. I have been as accommodating as I can. It provides what I was asked to do in Committee. I shall consider the rather more complicated situations which have been envisaged in the light of better informed scientific opinion than I am at the moment able to command from my own mind. In those events, I beg to move.
Lord Kilbracken: I do not know whether I can raise a point of order.
The Lord Chancellor: This is not Committee.
Lord Kilbracken: My Lords, that is why I raised it as a point of order; otherwise I would simply get up and speak. My point is that I have not spoken to Amendment No. 5. I feel that the amendment is necessary as a definition of conception which will appear in the noble and learned Lord's own amendment to the Bill. It is therefore still necessary and I should be able to move it.
Lord Elwyn-Jones Lord Elwyn-Jones My Lords, perhaps I may intervene; I hope to be helpful. My noble friend Lord Kilbracken can move an amendment at the next stage of these proceedings, but not today.
The Lord Chancellor: My Lords, I am very much obliged to the noble and learned Lord. I was going to say much the same myself, but he is obviously right. I cannot call Amendments Nos. 4 and 5 if Amendment No. 3 is passed. But I am not going to withdraw it. I see that I was wrong—I can call Amendment No. 5, but not Amendment No. 4. If I can, I shall call Amendment No. 5. I am advised quite confidently that I cannot call Amendment No. 4. If I therefore call Amendment No. 5 the noble Lord can speak to it; if I cannot, then he cannot.
On Question, amendment agreed to.
The Lord Chancellor: My Lords, I am advised that I cannot call Amendment No. 4. I shall call Amendment No. 5, but only after my noble friend—who I see is getting restive on the Front Bench—has made his Statement about Guinness.

Guinness plc
4 p.m.
"The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Lucas of Chilworth): My Lords, for the convenience of your Lordships, and with your Lordships' permission, I should like to repeat a Statement that has been made in another place by my honourable friend the Minister for Corporate Affairs in response to a Private Notice

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Question on the subject of Guinness. The Statement reads as follows:
"The inspectors appointed to look into the affairs of Guinness already have wide terms of reference which enable them to investigate any matter concerning Guinness and to require any persons, including its corporate advisers, whom they consider to have relevant information to give evidence to them. As and when I receive any material suggesting misconduct in a matter not concerning Guinness. I will consider it and take any appropriate action. I shall certainly not hesitate to make a further appointment of inspectors if the circumstances justify it."
My Lords, that concludes the Statement.
Lord Williams of Elvel: My Lords, we are most grateful to the noble Lord for repeating as a Statement the Answer given by his honourable friend in another place to a Private Notice Question.
I am sure that the noble Lord will realise that the whole matter of Guinness is now developing into a major financial scandal, and that is something that we have not seen in the City of London for at least a decade and more.
Two quite different issues are raised by the noble Lord's Statement. The first issue is whether or not there should be some form of interim report from the inspectors. The state of the market at the moment is that rumour is feeding on rumour. Almost every day some new and rather extraordinary turn of events takes place which is reported in the press, and there is nothing that the market likes worse than uncertainty.
I understand, and I hope that the noble Lord will be able to confirm, that the auditors of Guinness—Price Waterhouse—were commissioned by the board of Guinness to study the whole matter which is under review; that they reported to the board; and it was on the basis of that report that the board yesterday took the action that it did. In the light of that, is it not proper that the findings of Price Waterhouse should be made more generally available to make absolutely certain that all that is contained in this particular part of the Guinness activity should be seen to have been dealt with, and that there are no further shocks that the market may have to sustain?
There is a second question on the interim report. I understand the reticence of the noble Lord's honourable friend in agreeing to make any kind of commitment about this, but there is the question of whether there might be, as a result of the inspectors' report or investigations, any question of prosecution against any member of the company, or any of its advisers. I understand that it is not appropriate to make an interim report on that basis. Nevertheless, I come back to the first point and I feel that the question of whether this is an end which makes a full-stop to the rumours that are circulating round the City of London is a question to which the noble Lord may wish to address himself. If an interim report can be made I think that would serve the purpose.
The second major point to which the Statement gives rise concerns a wider issue. Of all people, the noble Lord will be aware that on 29th July last year I raised the whole question of the takeover of Distillers
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by Guinness and the statements that had been made by Guinness in the course of that. In replying to my remarks the noble Lord said that in his understanding, the Takeover Panel had the matter under review. It is clear that at that time this curious support operation for the Guinness share price was under way. It is therefore clear that the Takeover Panel, whether or not they had the whole matter under review, failed to pick up that this was happening. The Takeover Panel, as I argued at the time—and as a number of other noble Lords argued—can only work if everybody agrees to abide by the spirit and the rules of the code. Enough is now known about the matter to see that a number of people, some of them very highly respected names in the City of London, failed to do so. I should like to ask the noble Lord whether he would not even now consider taking some measures which would ensure that the Takeover Panel code and rulings should have some measure of statutory backing.
The second problem as regards the wider issues is whether this marks the end of self-regulation. At the time of the Financial Services Bill we made our position absolutely clear. We wished to see a system of practitioner-based regulation with a strong statutory superstructure. In my view the statutory superstructure is now more necessary than ever. I quite simply ask the noble Lord whether he and his department will not now bring forward the Financial Services Act (Amendment) (No. 1) Bill which will bear out some of the points that the Opposition were making during the passage of the Bill last summer.
Lord Wigoder: My Lords, the affairs of Guinness are very natuarally and properly a matter of considerable public discussion at the moment. They are a matter of very lengthy investigation in the press and it is not entirely surprising that there are members of political parties who think that there may be, in some way, some electoral advantage to be gained out of discussing them in considerable detail.
However, is it not the simple fact, as the noble Lord, Lord Lucas, has said, that there are inspectors appointed who have complete powers to pursue a thorough investigation? Is it not also the fact that those inspectors, under the Companies Acts 1948 and 1981, have the power, if they think it right, wise and sensible, to issue an interim report, and that at this stage the matter ought to be left there? Is this not a situation in which it would be quite wrong to keep calling for interim statements and interim reports before the investigations are completed, and when those interim statements and reports can only be prejudicial and unfair to some of the people involved? I suggest that it is very much in the public interest that we do not pursue this matter, that we do not make demands of that kind, and that we all control our impatience.
Lord Lucas of Chilworth: My Lords, I am greatly obliged to the noble Lord, Lord Wigoder, for his extremely wise words and the advice that he gives not only to your Lordships' House but, I hope, to a very much wider audience. I can add nothing further in response to his comments.
As regards the noble Lord, Lord Williams, I feel obliged, notwithstanding what I have said in answer to the noble Lord, Lord Wigoder, to respond to the

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specific points he makes. In so far as an interim report is concerned, officials in my department are of course in touch with the inspectors, who at this juncture agree that an interim report would be an unnecessary diversion of effort from the investigation. As regards the Takeover Panel, I believe, as I said last year, that taken together with the statutory powers the self-regulatory system is the best system to deal with the matters that are the subject of the Statement this afternoon. Obviously we shall take into account any matters which are relevant when we receive the inspectors' report.
With regard to underlining the position as we see it today, I think that noble Lords will agree that as soon as evidence came to our attention warranting the appointment of inspectors, the Government took immediate action to exercise the very strong and very wide-ranging powers that are available to them under the Companies Act 1985.
Lord Diamond: My Lords, while fully supporting every word that my noble friend Lord Wigoder has said, may I ask the noble Lord the Minister whether he takes the view that it would be unwise to base an alteration in the law on one incident, and terribly unwise to base it on that incident when one does not even know where the incident is?
Lord Renton: My Lords, could not that matter be regarded as both hypothetical and premature?
Lord Lucas of Chilworth: My Lords, in response to the noble Lord, Lord Diamond, and underlining what my noble friend Lord Renton has said, I think that, in fact, I answered when I said in response to the noble Lord, Lord Williams, that we would certainly be taking account of any matters that are relevant when the inspectors' report is to hand. That will be the time for us to give proper consideration to any matters of that kind.
Lord Williams of Elvel: My Lords, will the noble Lord not recognise that in the meantime there will be a lot of press speculation and a lot of rumour, and that there may be further developments about which we do not know that will create continuing uncertainty and prejudice the future of what is, after all, a great British company, one that we want to encourage? What measures can the Government think of that would reduce that uncertainty and allow the company to get on with its business?
Lord Lucas of Chilworth: My Lords, again, I have really answered, although I cannot stop speculation whether in the press or anywhere else. The Government took immediate, very strong powers as soon as evidence was brought before them and will not hesitate to take any action that is necessary in matters of this kind.
Lord Orr-Ewing: My Lords, will my noble friend not consider that the restructured board of Guinness will surely take every opportunity of giving information to its shareholders and the public as it becomes available? Would it not be unwise—as suggested from
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the Liberal Benches, endorsed by my noble friend Lord Renton—to rush into legislation which, as we have learnt time and again, is much less flexible and much slower to react than a self-regulatory authority such as that now being tried? Is it not far too early in this trial to pass judgment on a case which, as was said from the Liberal Benches, has not yet even been decided? I do hope that the Minister will abide by what he has said so far and will not be too swayed and rushed into any consideration of legislation yet awhile.
Lord Lucas of Chilworth: My Lords, my noble friend Lord Orr-Ewing raises two points. First, I think that he would recognise, as would other noble Lords, that it is not for me to suggest to the board of the company what it should or should not do. As to the second matter, I give my noble friend the assurance that the Government will not be rushed into any premature decision or premature consideration of the matters currently before them.

Family Law Reform Bill [H.L.]
4.14 p.m.
Consideration of amendments on Report resumed on Clause 1.
Lord Kilbracken Lord Kilbracken moved Amendment No. 5:
Page 2, line 5, at end insert—
("(4) In subection (3) above, conception shall be taken as occurring at the time when an ovum is fertilised, or, if fertilisation took place in vitro, at the time when an ovum is implanted.").
The noble Lord said: My Lords, Guinness was very good for me because it enabled me to put my papers in order. If this amendment had been called immediately, I should probably have been struck dumb and unable to respond.
I am grateful to the noble and learned Lord for agreeing that I should be permitted to move this amendment. It attempts to define the word "conception", and I believe that it would be necessary to do so even if the amendment that we have just agreed became part of the statute in its present form.
I ought to mention that in the Marshalled List this should be shown as being new subsection (4). It was so numbered when it first appeared in the printed paper this week but, since then, in the preparation of the Marshalled List that has been omitted from the beginning of the line.
I think that it is necessary to include some definition of the word "conception", as it is something that has become a great deal more complicated than it used to be. This is a somewhat profound matter because we are, after all, talking about the very precise moment at which human life, or indeed any form of life, begins.
Through all the centuries and millenia I do not think that anyone until quite recently knew anything about this at all. It was known that intercourse took place; then it was said that subsequently conception took place, gestation took place and eventually a child was born. Although it may be possible under laboratory or hospital conditions to ascertain the precise, or nearly the precise, moment when conception takes place, it is not so on any other occasion. If a woman conceives,

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she knows only that it occurred anything up to one week perhaps after the act of intercourse. Of course in the case of in vitro fertilisation, conception takes place in the dish and birth may not take place for 10 or 20 years, as I have said before.
If we try to decide when conception takes place, I do not know that there is any existing phrase or criterion by which it can be decided. As I understand it, conception could be one of a number of moments after intercourse has taken place. It could be at the moment of the inception of organogenesis; it could be at the inception of the embedment of the cell cluster in the uterus wall; it could be on the completion of the self-organisation of a group of cells into an embryonic plate; it could be on the development of a primitive streak in the embryonic plate or it could be on the completion of the embedment of a cell cluster in the uterus wall. I do not know which of those it is, and I do not think that anyone has tried to find out.
It could also be what I have covered in my amendment; that it is at present the unknown moment in the case of ordinary intercourse when an ovum is fertilised. I think that it is necessary to specify this even if it is something we will never know in the case of our own wives or our own daughters. We have to decide at what moment conception takes place. I think that, unless it takes place in a dish, it should be at the moment when an egg is fertilised.
I have stated in the amendment that, if fertilisation takes place in vitro, then for the purpose of the Bill and in future enactments conception should be considered as taking place at the moment when the ovum is implanted. Although that is not when conception takes place, for the purpose of the Bill, that is what should be considered. When implantation takes place five, six, eight, 10 or 20 years after the eggs have been fertilised in vitro, I think the moment of implantation of the fertilised egg in the womb should be the time on which the appropriate decision is based. In other words, my amendment would mean that if a child is to be taken as one whose parents were married at the time of his birth, implantation in the case of in vitro fertilisation would have to have taken place before his father's death. That is how I believe it should be. I beg to move.
The Lord Bishop of Birmingham: My Lords, I wonder whether in moving this amendment the noble Lord, Lord Kilbracken, is aware that it is several days after an embryo reaches the womb before it becomes implanted. The noble and learned Lord the Lord Chancellor pointed out that a gap of time was unfortunate and could have unfortunate results if someone died between the two. I did not realise that your Lordships' House would be discussing the complexities of the Warnock Report. Indeed, my amendment is definitely concerned with preventing that, so I have not revised my homework as I might. However, my memory is that it is normally about six days before the fertilised ovum is implanted in the womb. Therefore, there seems to me a long gap here. I should have thought that the kind of objections that the noble and learned Lord the Lord Chancellor brought previously would apply particularly in this matter.
Lord Campbell of Alloway: My Lords, having regard to the somewhat enigmatic scope of the definition of conception in paragraph (b) of Amendment No. 3, on which assistance is still sought, I wish very shortly to support the spirit of this amendment for the reasons I gave on Amendment No. 3—basically to ensure that in the case of in vitro fertilisation conception is related to the time of the implant in the womb.
With respect to the right reverend Prelate the Bishop of Birmingham, a gap of six days is neither here nor there. It is in fact about that time of implant, as distinct from the time of fertilisation in vitro, which could on one concept of conception mean conception. It is that differential for which I contend for the later point of time. That is all that it is. Whether or not this takes place in some tubes to which the right reverend Prelate referred (or in any other way) does not seem to be wholly material. I know that the noble and learned Lord the Lord Chancellor will consider the merit of the argument whether he agrees with it or not. One should put the time back as far as one can on the definition of conception.
The Lord Chancellor: My Lords, of course I will consider everything that has been said so learnedly from whatever quarter. I think we are in danger of muddling ourselves. We must start with the proposition that the very largest majority of children are born as a result of an ordinary act of sexual intercourse between a man and a woman, done in the old-fashioned way. The very elaborate suppositions of the noble Lord, Lord Kilbracken, and even those of my noble friend Lord Campbell of Alloway are the exception rather than the rule. Some of them are extremely unlikely to occur at all.
I had hoped that I had made things plain by Amendment No. 3, which clearly shows that we do include within the ambit of the Bill fertilisation in vitro. I explained proleptically the objections to the amendment I was unable to call, Amendment No. 4. The objections were based on a fact of which I had previously been unaware; namely that there is always a period of delay between the act of ordinary intercourse and the moment of conception—a minimum period of six hours.
Suppose a husband comes home to his wife after working abroad and dies perhaps from sheer joy immediately after their first and only act of intercourse which ultimately results in the birth of their child. The effect of Amendment No. 4 would have been (and I am advised that is is also the effect of Amendment No. 5) that the poor child would then be born illegitimate. This is something which is not to be borne. It is something up with which we cannot put.
There is a further reason which has to be stated. It is right that Clause 1(3), and the Act as ultimately passed and as it ultimately is, should refer to the act of intercourse or insemination because in the overwhelming majority of cases that will remain the means of procreation of a child. It is right that the subsection should recognise this by express reference. The reference to conception is included only to cater for the very small minority of cases of artificial insemination.

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Frankly, I had hoped that the noble Lord, Lord Kilbracken, would not think it right to move this amendment, though I now understand that he wished to say what he has said and therefore I am very glad that I was able to call it. I hope that the noble Lord, having heard my undertaking to consider the rather elaborate sets of circumstances which have been postulated, will not press the amendment further.
Lord Mishcon: My Lords, I wonder whether I may ask the noble and learned Lord the Lord Chancellor to consider at least one aspect when he is looking at the speeches that have been so learnedly delivered today. I speak as one so ignorant on these matters that it may be that my question is not even a material one. However, it seems from a practical point of view that if one defines in a statute that the time has got to be precise when certain things occur—namely, the ovum being fertilised, and if fertilisation takes place in vitro the time when an ovum is implanted—presumably there will be a need for certificates from some medical or other authority certifying precisely what that time was. One cannot go blandly thinking about scientific evidence being available post facto.
Therefore I wonder whether one of the considerations that the noble and learned Lord the Lord Chancellor will bear in mind is the practical question. One could envisage a birth certificate being accompanied by the most weird and wonderful medical certificates in regard to timing and a matter which will obviously be extremely new in the family life of the world and certainly of this country.
Lord Simon of Glaisdale: My Lords, the noble and learned Lord the Lord Chancellor has said that he will consider all these matters. It seems to me that we have to leave the matter in his hands at this juncture. I indicated during discussion on Amendment No. 3 that I preferred Amendments Nos. 4 and 5 as a way of dealing with the matter. Now that your Lordships have accepted Amendment No. 3, Amendment No. 5 will simply not work. The question of implantation time is raised in the last phrase. This is a very serious matter which no doubt my noble and learned friend will be considering along with all the other matters.
The Lord Chancellor: My Lords, if I may obtain the leave of the House to say just a word, it was very largely for the kind of reason that the noble Lord, Lord Mishcon gave that I suggested that we had better do what my noble and learned friend has suggested we should do; that is, leave the thing as far as possible in my rather ignorant hands. My hands may be ignorant, but I have available very good advice, which I shall take. I think that would be best. One has to remember the sort of practical question which the noble Lord, Lord Mishcon, put forward. How is one to verify these facts? In the end, they would have to be verified by the courts, and when anything has to be verified by the courts there is the prospect of litigation. The definition which we have accepted in Amendment No. 3 at least makes things rather easier for those who come after us, and I hope we shall stick to it.
4.30 p.m.
Lord Kilbracken: My Lords, I agree with both the noble and learned Lord, Lord Simon of Glaisdale, and
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the noble and learned Lord on the Woolsack that we should not take this matter any further. Certainly, it would be quite impossible for this amendment to be accepted in view of the acceptance of that of the noble and learned Lord. Before withdrawing it, however, there are one or two points which I should like to make.
The noble and learned Lord on the Woolsack spoke of much prefering the good old-fashioned way of engendering children. I absolutely agree with him on that point. My immediate reaction was to feel that that was all very well, but with the good old-fashioned way there are no problems; no problems arise of definition. It is precisely with the new-fangled ways, when AID, AIH, in vitro and all the other methods are employed, that the difficulties arise, and we have to consider them and they have to be in the Bill.
Then I found that the good old-fashioned way was not so very straightforward, because the noble and learned Lord came up with the case of a man who had been out of the country for a time who came back for a bit of the good old-fashioned way and promptly expired with excitement at the moment of ejaculation. The noble and learned Lord felt—he may be quite right—that that would create all kinds of difficulties. I agree that it could happen. He quoted Murphy's law at the Committee stage, and under Murphy's law it almost certainly would happen, but who is going to know that it happened, and when is it ever going to be relevant?
Is it ever going to happen that a child is conceived in those circumstances and nine months or more later someone comes along and says, "Oh, there was an inquest in this case. The poor unfortunate fellow died when he was on the job", if that is not too vulgar a phrase for your Lordships' House, "and because he died at that particular moment, he died before conception had taken place. Therefore, the poor unfortunate child has to be treated as being illegitimate". That is an absolute flight of fancy. It is a scenario which I think it is quite unnecessary to consider.
Another point I should like to make before I sit down arises from the remarks of my noble friend Lord Mishcon, who complained, quite rightly I suppose, that conception is something we cannot pin down. We can never say when it took place. It is vague to talk about conception. But if we talk about an act of intercourse—and we keep referring to acts of intercourse in the Bill—by a young married couple all around the time that they got married and a child is conceived, I cannot tell you when that child was conceived. Can any of your Lordships tell me which act of intercourse was responsible for that child? Suppose it was four or five times a day for a fortnight, or maybe 50 acts of intercourse, you can be far less exact on the question of which act of intercourse was responsible than when the conception took place.
I feel there are some rather complicated questions in this whole matter. I gave it a lot of thought over the Christmas period, and I think that other noble Lords and noble and learned Lords should do the same. In the meantime, I shall let this gestation go on. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 2 [Construction of enactments relating to parental rights and duties]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 6:
Page 2, line 17, leave out ("section") and insert ("sections").
The noble and learned Lord said: My Lords, this amendment corrects a typographical error. It substitutes a plural for a singular. I beg to move.
On Question, amendment agreed to.
Clause 9 [Consents to marriages]:
Lord Kilbracken Lord Kilbracken moved Amendment No. 7:
Page 5, line 32, at end insert ("AND THE CHILD HAS NOT BEEN LEGITIMATED OR ADOPTED")
The noble Lord said: My Lords, in order to understand the purpose of this amendment, which concerns page 5, line 32, you would have to have a copy of the Marriage Act 1949 which this clause in the Bill amends. I do not suppose that any of your Lordships have seen it, but the second schedule of the Marriage Act lays down those who have to give their consent under different circumstances in the case of the marriage of an infant.
There are two sections in the second schedule to the Act. The first is headed,
"I. WHERE THE INFANT IS LEGITIMATE",
and the other is headed,
"II. WHERE THE INFANT IS ILLEGITIMATE".
That is a word which we do not want to use any more in this Bill. If your Lordships turn to Clause 9 of the Bill, it will be seen that Part II of the schedule is replaced by the passage in the Bill headed,
"II. WHERE THE PARENTS OF THE CHILD WERE NOT MARRIED TO EACH OTHER AT THE TIME OF HIS BIRTH",
and then the details. That would mean that in the schedule to the Act one section is headed,
I. WHERE THE INFANT IS LEGITIMATE",
and one section is headed,
"II. WHERE THE PARENTS OF THE CHILD WERE NOT MARRIED TO EACH OTHER AT THE TIME OF HIS BIRTH".
That would mean that in the case of children who have been legitimated or adopted, those children are legitimate and would therefore come under Part I of the schedule; but without my amendment they would also come under Part II because their parents were not married to each other at the time of their birth. I am therefore maintaining that instead we have to say in Clause 9:
"II. WHERE THE PARENTS OF THE CHILD WERE NOT MARRIED TO EACH OTHER AT THE TIME OF HIS BIRTH AND THE CHILD HAS NOT BEEN LEGITIMISED OR ADOPTED".
I beg to move.
The Lord Chancellor: My Lords, the purpose and effect of this amendment are mainly drafting, but it is totally unnecessary. Section 78 of the 1949 Act, "Interpretation", to which the noble Lord has drawn attention, is amended by paragraph 10 of Schedule 2 of the present Bill, so that it is made clear in the 1949 Act itself that references in that Act to the parents of a child being, or not being, married to each other at the time of his birth shall be construed in accordance with Clause 1 of this Bill, if it becomes law.
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Clause I makes it plain that a reference to a child whose parents were not married to each other at the time of his birth includes a reference to a child who has not been legitimated or adopted. The amendment is therefore unnecessary, and it is also contrary to the general way in which the draftsman of the Bill has sought to avoid labelling illegitimate children. I would therefore urge the noble Lord not to press his amendment.
Lord Kilbracken: My Lords, the noble and learned Lord sometimes complains that I do not notify him in advance of what I am going to say, although in fact I have done so. Of course he never has to notify me in advance of what he is going to say. I am afraid that without studying what he has said I cannot comment further on this matter. Therefore, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 22 [Declarations of parentage]:
Lord Kilbracken Lord Kilbracken moved Amendment No. 8:
Page 14, line I, leave out subsection (1) and insert—
("(1) Any person may apply to the court for a declaration that a person named in the application is or was his parent.").
The noble Lord said: My Lords, this is purely a drafting matter. Subsection (1) of Section 56 of the Family Law Act 1986 is amended by this subsection. I put down this amendment for one reason, and one reason only, and that is that I think that, although the substance of Bills is of supreme importance, it is also of value to use brevity and clarity; and I feel that often legislation is much more complicated and occupies a great deal more space than it ought to do. As a journalist and author I know that I feel that every word is precious, sometimes even every letter, and that attempts should be made where possible to make any passage as short as it can be.
In this amendment your Lordships will see that new Section 56(1), at the top of page 14, occupies eight lines. My amendment occupies one and a half lines. In my opinion my amendment says everything that the existing subsection says. The subsection says:
"Any person may apply to the court",
and then,
"for one or more of the following declarations with respect to his parentage, that is to say".
I say that all that is unnecessary. My amendment says:
"for a declaration that a person named in the application is or was his parent".
I do not think that I have left out anything from those eight lines, and I have at the same time incorporated Amendments Nos. 10 and 11, because I put in "is or was" instead of "is". In the interests of brevity and clarity, I beg to move this amendment.
Lord Renton: My Lords, I think that the noble Lord, Lord Kilbracken, is to be congratulated on attempting to express in two lines what appears in eight lines in the Bill. I do not think that he has altered the effect. I do not think so, although there is just one point which the Lord Chancellor may or may not take. I am not going to put it into his head in case he has not thought of it. I think that this is a commendable effort on the part of the noble Lord.

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While I am on my feet and we are considering Clause 22, let me thank the noble and learned Lord the Lord Chancellor for so courteously and kindly writing to me during the parliamentary recess in answer to two points that I made about the application of that clause. I accept what he told me, and I am grateful.
4.45 p.m.
The Lord Chancellor: My Lords, I am grateful to both noble Lords. The addition of the words "or was" in the amendment is of course an improvement, but it is carried into effect also, and alternatively, by my Amendments Nos. 9 to 12 in the appropriate places.
Of course I do not claim to be an expert parliamentary draftsman but I think I understand the draftsman's preference for his own language rather than that of the noble Lord, Lord Kilbracken, although I would wholeheartedly agree with my noble friend Lord Renton when he says—as the noble Lord also said—that if you can put something into two lines it is better to do so than to spell it out in ten, or words to that effect.
But one never knows what courts will do unless things are rather spelled out for them. It is possible that the amendment of the noble Lord would work in the way he expects, but the whole of Part III of the Act of 1986, as amended by the present Bill, is drafted in a particular way. That way is to spell out what is intended in very full terms. One can see that if one looks at Section 56 of the Family Law Act 1986, which is already law.
The draftsman suggests that the somewhat compressed nature of the noble Lord's amendment would be out of keeping with the provisions surrounding it in the Act it is intended to amend. I would on the whole stand by that, without in any way depreciating the value of the noble Lord's suggestion. If the old Act had been altered in this way and drafted in this way, perhaps it might have been a good thing, but I think it might mystify the courts if this new style amendment were inserted into an Act which has already been passed. I would therefore stand by the draftsman without claiming any superior knowledge of my own.
Lord Mishcon: My Lords, I wonder whether the noble and learned Lord would be courteous enough to agree that he has defended many people in his time and done it very ably, but on this occasion he does not appear to me, at least effectively, to lave defended the parliamentary draftsman. If we had listened to one single reason as to why this amendment was not acceptable, or if one had heard one single difficulty with which the court might be faced, it would be different. This is a sensible amendment, as it seems to me, which compresses into simple language and a couple of lines what is spelled out here in my view—and I know it is the noble Lord's view too—in quite unnecessary individual heads.
Section 56(1) asks for leave of Parliament—and it gets it—for a person being able to apply for a certain declaration. What is that declaration? If you look at paragraphs (a), (b) and (c) it all amounts to the fact that it is a declaration that a person named in the application is or was his parent.
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We sit here as a revising Chamber. I know that the noble Lord, Lord Renton, is beloved by all of us because he always puts us right when it comes to a question of parliamentary draftsmanship, and his committee once deliberated and gave opinions and recommendations some time ago on certain principles.
There has to be a good reason why we do not accept one and a half lines in the place of about seven or eight. If the noble and learned Lord would kindly give one good reason I, at all events, should listen to him, but if he cannot, I hope that the House will accept the amendment.
Lord Renton: My Lords, if I may with leave of the House speak again briefly, when we are having to reenact, wholly or in part, previous legislation, we should not be debarred from improving it, except in those circumstances where a particular phrase has been the subject of judicial interpretation. That was the secretive point that I had in my mind when I spoke earlier. My noble and learned friend the Lord Chancellor did not take that point. If, on the other hand, he can assure us that there are particular phrases in the first eight lines as they stand which have been judicially interpreted and which therefore we must not touch then I should go along with him. Otherwise I join with the noble Lord, Lord Mishcon, in hoping that the splendid effort of the noble Lord, Lord Kilbracken, may one day prevail.
Lord Simon of Glaisdale: My Lords, I hope my noble and learned friend the Lord Chancellor will reconsider this matter before the next stage. The only reason that was put forward was that previous legislation was done in a different way. If we are going to stand on that we shall never improve our statutory procedures.
Again I draw attention to the very wise words put forward by two great judges, Lord Elmslie and Lord Wheatley that I quoted on an earlier amendment. I hope my noble and learned friend will see the advantage of this economical way of drafting. Speaking for myself, I cannot conceive any court being misled in any way by the draft of the noble Lord, Lord Kilbracken.
The Lord Chancellor: My Lords, of course I shall consider what has been said; but I am not wholly convinced by all this. We are not acting as a revising Chamber for the purpose of redrafting an Act which has already been passed.
Section 56 of the Act in which it is designed to insert a new clause is intended to be an insert into an existing Act of Parliament. Part III of the Act of Parliament, of which Section 56 is an example, is drafted in a particular way. I am afraid the section which it is intended to insert is inserted in the same style and in the same manner as the other parts of Part III.
Of course I cannot give my noble friend Lord Renton any assurance that the matter of Part III has not been the subject of judicial interpretation. I could find out and probably let him know, but we are now at the Report stage of a Bill. If this had been put forward in Committee I should have very happily said that we would consider it again on Report; but we are now on

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Report and the draftsman advises me that there is a real danger that the insertion of what looks like an ingenious improvement, but may not necessarily be, will cause confusion when the rest of Part III is considered. There is no suggestion whatever that there is anything wrong with Part III of the Family Law Act as it stands. What it is proposed to do is to revise an Act of Parliament and not to revise a Bill. We are a revising Chamber, but we are a revising Chamber when we enact Bills not when we consider Acts of Parliament which have already been passed.
There is a question of principle here. I consider that we are acting a little in a headstrong way if we disregard professional advice that we have had about an Act of Parliament, the other sections of which in the relevant part of it have not been examined in context. Although I am perfectly prepared to have this considered again, I am not altogether persuaded that the noble Lord, Lord Mishcon, is not being a bit headstrong and a bit hasty in what he said to the House.
Lord Elwyn-Jones: My Lords, do those final words indicate that the noble and learned Lord is willing to consider this again before Third Reading? That would seem to be the solution in view of the strength of opinion.
The Lord Chancellor: Yes, my Lords, it does. But I feel we are making rather a meal of this. I have already unequivocally said that I shall consider it, but I do think that at Report stage we had better get on.
Lord Kilbracken: My Lords, I am very grateful for the powerful support that I have had for this little amendment, not only from the Government Benches and from my own Front Bench, but also from the Cross-Benches from the noble and learned Lord, Lord Simon of Glaisdale. This is not a matter of importance. It does not affect the meaning of the Bill in any way. It is simply an attempt to show how eight or nine lines can be expressed equally well within a line and a half. All the noble and learned Lord on the Woolsack seems to have said is that it cannot be accepted because the rest of the Act it amends is so badly and verbosely worded—
The Lord Chancellor: My Lords, I did not say that.
Lord Kilbracken: My Lords, the noble and learned Lord says that he did not say it; but what I gathered from what he was saying was that if my subsection were inserted into it it would be in such a contrast with the rest of the Act because it was well written instead of being badly and verbosely written that it could not be accepted. I had not intended to withdraw this amendment, but I would have said "Content" rather softly. In view of the undertaking of the noble and learned Lord on the Woolsack that he will consider it between now and Third Reading, I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
The Lord Chancellor The Lord Chancellor moved Amendment No. 9:
Page 14, line 1, leave out ("one or more") and insert ("either or both").
The noble and learned Lord said: My Lords, with this amendment, I shall speak to Amendments Nos. 10, I 11 and 12, if the House will allow me to do so. These points have already been dealt with, and the noble Lord, Lord Kilbracken, inserted the word "was" in his former amendment. I think I can move the amendments formally. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendments Nos. 10, 11 and 12:
Page 14, line 5, after ("is") insert ("or was")
Page 14, line 6, after ("is") insert ("or was")
Page 14, leave out lines 7 and 8.
On Question, amendments agreed to.
Clause 23: [Provisions as to blood tests]:
The Lord Chancellor: My Lords, before I call Amendment No. 13, perhaps it would be convenient for the noble Lord, Lord Kilbracken, if I tell him in advance that I intend to accept his amendment.
Lord Kilbracken Lord Kilbracken moved Amendment No. 13:
Page 14, line 39, leave out ("subsection") and insert ("subsections").
The noble Lord said: My Lords, I think that is a bit unfair to tell me in advance. I knew perfectly well that the noble and learned Lord would have to accept it, and that is why I put it down. When I was working on this Bill over Christmas I came upon four or five mistakes so trivial that probably only retired chief subeditors such as myself would ever have noticed them. All but one of these were so trivial that changes could be made when the Bill went for printing. But I saved one.
Even though the Lord Chancellor's stonewalling technique refused to agree to any of my other amendments, this one he will be forced to accept because it is a typographical error. If he had not told me in advance that he would accept it, I would have told him that if he resisted this I should personally have presented him with a pair of white gloves. I now cannot do that, but I beg leave to move the amendment.
On Question, amendment agreed to.
5 p.m.
The Lord Chancellor The Lord Chancellor moved Amendment No. 14:
Page 14, line 49, leave out ("blood samples") and insert ("samples of blood or tissue").
The noble and learned Lord said: My Lords, I may say for the convenience of the noble Lord, Lord Kilbracken, that I am going to accept this amendment in principle, but I would ask him to withdraw it until I can propose another amendment on Third Reading.
Lord Kilbracken: My Lords, I must say that I find this rather improper. I am very grateful for what the noble and learned Lord said, but when he calls amendments he is supposed to allow the person moving the amendment to get up to say what he was going to say and he can make his comments afterwards. For him to get up first and say that he thinks I may have a point is very nice to know, but it is the normal and invariable practice in your

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Lordships' House that the Minister should give his opinion after the mover of the amendment has spoken.
However, in view of what the noble and learned Lord has said, I shall only mention that certainly in Clause 23, which refers to blood testing, as it is called in the Bill, there are changes which should be made because of progress which has been made in recent years in ways to establish paternity by means of medical tests.
The clause as at present worded refers only to blood tests and blood samples, whereas the more important and more reliable tests nowadays involve tissue typing and DNA analysis, and in order to carry these out—and they are carried out, as the noble and learned Lord mentioned at the Committee stage—it is necessary to take samples of tissue and to have tests of blood and tissue. In addition to this amendment, it would be necessary to make an amendment on page 14, line 45, and on page 15, line 3, where there are references to blood tests and also in many places in Part III of the Family Law Reform Act of 1969. So I beg to move and will listen with interest to what the noble and learned Lord now has to say.
The Lord Chancellor: My Lords, I make no apology for trying to save the time of the House by telling the noble Lord in advance that he is pushing at an open door. The reason why I would ask him to consider withdrawing the amendment is that it does not go far enough. He is perfectly right in saying that his amendment has revealed a lacuna in Clause 23, but it does not go far enough because it will not cover bodily fluids such as saliva or semen.
Further, a second reason is that it is necessary to make a further consequential amendment to Part III of the Family Law Reform Act 1969 which deals generally with the topic of blood testing. If the noble Lord agrees to withdraw his amendment, I undertake to table at Third Reading an amendment to cover the point.
Lord Kilbracken: My Lords, I am most grateful to the noble and learned Lord, and of course I shall do as he asks. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Kilbracken Lord Kilbracken moved Amendment No. 15:
Page 14, line 49, leave out from ("from") to end of line 51 and insert ("that person and any party to the proceedings who is alleged to be his father or mother;").
The noble Lord said: This matter relates to the persons from whom blood tests may be ordered. I want to extend this to,
"that person and any party to the proceedings who is alleged to be his [the child's] father or mother".
As the Bill is drafted at present, any person who is alleged to be the father or mother may be ordered to have blood taken for testing, although they are not parties to the proceedings. I do not think that anyone who is not a party to the proceedings ought to be forced to have a blood test.
It has been pointed out to me that my amendment might not be suitable because of a case which happens
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quite frequently in which the biological father of a child may be one of two men who both had intercourse with the wife, or indeed three of four men who had intercourse with the wife during the period when conception might have taken place. In the case where there are two possible fathers and one could be rather more likely than the other for various reasons, it could happen that that likelier father was out of the country and could not be a party to the proceedings and could not be ordered to have blood tests. But then it would contribute to identifying the child if the less likely of the two fathers were tested. But if that were to be the case, under my amendment it would only be necessary to make that less likely father, for the purposes of eliminating him, a party to the proceedings and to allege him to be the father. I think that is all I can say on this amendment. I beg to move.
Lord Meston: My Lords, I was only going to say that again the noble Lord, Lord Kilbracken, has given a great deal of thought to this. Certainly on one reading of Clause 23 as drafted, it might be thought, and this is certainly my interpretation of it as a humble lawyer, that it was necessary for the person alleged to be the father or mother to be already a party to the proceedings. I think that is implicit in the words at the end of Clause 23(1)(b),
"any other party to the proceedings".
But as the noble Lord says, Clause 23 as drafted might be taken to entitle the court to direct blood tests against any person alleged by anyone to be the father or mother of the child, irrespective of whether that person is a party to the proceedings. In so far as there may be any doubt about that, the noble Lord, Lord Kilbracken, is right to try and have that doubt cleared up.
That is not just a matter of a dry, legal argument. To require people to undergo blood tests can at the very least be an embarrassment and inconvenience and certainly can be an infringement of personal liberty. It must be quite clear who can be required to take a blood test. In the typical case one comes across in my squalid sort of practice, the woman accuses her boyfriend of being the father of the child. The boyfriend says, "I doubt it, our relationship was going through a bad period, and anyway I saw her kissing the milkman", or "smiling at the postman", or "I heard that she was holding hands with a man in the pub". In the usual course of events the court would not require the milkman or any other innocent third party to be tested.
"The party to the proceedings" has a strict legal sense. I think its is defined in the Supreme Court Act as someone who is served with notice of the proceedings or who otherwise intervenes. But in certain circumstances of course it would be right for third parties to be made parties to the proceedings in the strict legal sense where they are strong candidates for paternity. But the court must have its discretion unfettered in that respect.
At Committee stage, the noble and learned Lord the Lord Chancellor, I think, referred to the husband, for example, in a case where the lady is still married and the husband still on the scene. There are other circumstances where either one or other of the parents

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may have died and there is a brother or a sister to be tested. However, I venture to suggest that the noble Lord, Lord Kilbracken, has put his finger on an important point in saying that the circumstances in which potentially innocent third parties should be subjected to blood tests, and indeed other sorts of tests as they are now to be introduced into the law, should be clearly circumscribed.
Lord Campbell of Alloway: My Lords, perhaps I may briefly rise to support the amendment. It may well be said that it is unnecessary on one view and on one interpretation of the statute. But it serves as an aid to clarification and I respectfully suggest that it is appropriate and worthy of consideration.
Lord Silkin of Dulwich: My Lords, my difficulty with the amendment of my noble friend is that, while it may very well, as has been suggested, clarify a possible deficiency in the clause as it exists, it seems to create another deficiency. The existing clause provides that the power to order the taking of blood samples should apply to the person making the application or,
"any party who is alleged to be the father or mother of that person"—
which is the point dealt with by my noble friend—
"and any other party to the proceedings".
Those final words are omitted from my noble friend's amendment.
In Committee I raised the question of who could be a party to the proceedings, with particular reference, for example, to a brother or sister. The noble and learned Lord the Lord Chancellor has kindly written to me on that point and assured me that rules will be made to indentify people who can be party to the proceedings and that they may well include brothers and sisters. If accepted, this amendment would rule out that possibility so far as the taking of blood samples is concerned. At the moment I am not clear why that should be so.
The Lord Chancellor: My Lords, I agree with every word which has fallen from the noble and learned Lord on the Front Bench of the Opposition. I believe we are all agreed that the court should only be empowered to give directions as to the taking of blood samples from persons party to the proceedings for the reason given by the noble Lord, Lord Meston, that it is an intrusion to take blood samples compulsorily and therefore persons should be party to the proceedings before they are taken. They should be either the applicant or certain other parties to the proceedings. The effect of the present amendment of the noble Lord, Lord Kilbracken, which I thought we had discussed fairly fully in Committee, is in fact to rule out parties to the proceedings (either the applicant or others) who are not alleged to be parents of the child, who of course must be parties to the proceedings.
A simple example, which I think the noble Lord, Lord Meston, and possibly the noble Lord, Lord Kilbracken, have in mind, is this. Suppose a person who wants to apply for a declaration as to parentage knows the identity of his mother (which is usually the case) but knows also that his father must be one of two men. I use that simple example, though the number may be more than two. However, suppose that person
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knows that his father must be either Abraham Alpha or Benjamin Beta and that both of them are known to have had intercourse with the mother.
If the applicant suspects that Benjamin Beta was the father but he is abroad and cannot be made party to the proceedings, blood tests could be ordered from Abraham Alpha if he was a party to the proceedings. If those showed negatively that Abraham Alpha could not be the father of the applicant, it might well be the case that the court would find that Benjamin Beta, though absent and though no blood tests had been taken from him, was by process of elimination the true father. That might be desirable. I think that was largely the point made by the noble and learned Lord, Lord Silkin, and I think it is a good point. Therefore I would ask the House not to accept this amendment.
5.15 p.m.
Lord Kilbracken: My Lords, I am grateful to all noble Lords who have taken part in this debate. I must say that I found the comments of the noble and learned Lord to be rather mysterious. I stated on two or three occasions that certainly no one should be ordered to have blood tests who is not a party to the proceedings. He emphasised that. If your Lordships will consider the wording of the Bill at present in paragraph (b) at the bottom of page 14, you will see that it states:
"for the taking, within the period specified in the direction, of blood samples from all or any of the following, namely, that person"—
which means the child—
"any party who is alleged to be the father or mother of that person and any other party to the proceedings".
The use of the word "other" is very misleading because it makes it look as though other parties to the proceedings have already been mentioned. However, they have not, because the paragraph says:
"any party who is alleged to be the father or mother of that person and any other party to the proceedings".
My point is that the Bill as drafted at present includes persons who are not party to the proceedings. Furthermore, I suggest to the noble and learned Lord on the Woolsack that in the example he gave the man he called Abraham Alpha (who is the less likely father), who stayed at home, rather than Benjamin Beta, who has gone to the Continent, could under my amendment perfectly well be ordered to give blood simply by making him a party to the proceedings and having someone allege that he is the father.
We have the phrase,
"alleged to be the father or mother".
We do not know who has to allege that or where they have to allege it; presumably the wife can allege it and make him a party to the proceedings. In any case, that is not going to stop Abraham Alpha from being forced to have a blood test.
I do not intend to press this matter to a Division. But I think it is a matter that requires attention and perhaps will awaken an interest in the subject in other noble Lords. In those circumstances I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 24 [Registration of father where parents not married]:
Lord Kilbracken Lord Kilbracken moved Amendment No. 16:
Page 15, line 31, leave out from ("birth") to end of line 15 on page 16 and insert—
("the father shall not be required to give information concerning the child's birth; and the registrar shall not enter his name in the register as the child's father except—

(a) at the joint request of the father and mother, in which case they shall sign the register together; or

(b) at the request of the father or mother on production of—

(i) declarations by both of them in the prescribed form stating that they are the parents; or

(ii) a certified copy of a relevant order; and

(iii) in either case, if the child is over sixteen, the written consent of the child.

(2) Where the father makes a request to the registrar under paragraph (b) of subsection (1) above—").
The noble Lord said: My Lords, I am glad that the noble and learned Lord took a little time to call the amendment because it has given me time to sort out my papers and get my breath back. I must say that my stamina is beginning to flag. I shall try to do my best because I feel that this is the most important amendment I have put down and I very much hope that some of your Lordships will feel the same.
Clause 24 is about the registration of births. It amends Section 10 of the Births and Deaths Registration Act 1953. It lays down the action necessary if the natural, unmarried father of the child is to have his name entered on the register. I feel strongly about this for two separate reasons. First, all through the Bill, right up until Clause 24, the unmarried father has been treated in a way completely different from any preceding legislation. That is an important feature and is part of the Bill's much more enlightened attitude towards people born out of wedlock.
Until now, in clause after clause of the Bill, when there has been reference to an unmarried father, rather to my surprise he has always been described simply as "the father". It took me some time to realise that that is what the Bill meant in every case, because there may be the biological father, the legal father and the adoptive father. But in clause after clause right up to this point, when there is a reference to the natural father he is described simply as "the father". That is the way it should be and I welcome it.
When we come to this clause about entering the father's name on the register he suddenly becomes "that person", "the person stating himself to be the father", and so on. Unlike the rest of the Bill the whole of this clause reaks of the old-fashioned thinking and assumption that an unmarried father is a shadowy figure somewhere in the background, that very often he has made himself scarce and his whereabouts is not known or indeed that his identity may not be known. While this is sometimes, or perhaps often, still the case, I feel that it is completely wrong and a great pity that alone in the Bill this clause should be drafted as though that were the typical and usual position.
More and more couples are living together without the benefit of clergy. They are in stable relationships, with children, and fathers are increasingly acknowledging and taking some responsibility for their
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children whether or not they are involved in such stable relationships. Therefore I tried to redraft this subsection in about half the length that it presently occupies so that, although it is an amendment to another Act and might stick out in that Act as being drafted in a literate way, it would be clear and concise.
I should like to go through the clause in a moment but there is a separate point that I wish to raise first. I refer to the question of whether or not the child in the case should be allowed to object to the insertion of the natural father's name on the register. On page 15 of the Bill your Lordships will see the different conditions that are necessary if a father's name is to be entered on the register—first, if the father and mother go along together; secondly, if the mother goes along with the consent of the father; and thirdly, if the father goes along with the consent of the mother. However, only under paragraph (d) at the top of page 16, at the request of the mother or the father and on production of a copy of a relevant order—"relevant order" is defined lower down the page at line 31—for some very strange reason the written consent of the child is required if the child has attained the age of 16.
I think that is perfectly right, but I also think that in any case the written consent of the child over 16 should be required except possibly if it is one of those cases where the father and mother are such great pals that they go along together and sign the register together; and then I think that they should not have to get the child's permission. But in all other cases, where the father goes along by himself with a written statement from the wife, or vice versa, I feel strongly that the consent of the child is essential.
Let us remember that very often the child has a deep resentment of his natural father. The child may resent the fact that that father did not marry his mother and he may have suffered throughout his life from the stigma attached to what we used to call illegitimacy. Yet if the father has a relevant order, which is any of the orders listed, he can go along on his own initiative and have his name entered on the register without the consent of the mother or the child. The child may resent that very much. I feel that it should be laid down that in all such cases where the child is over 16, or 18 if your prefer, the child's consent should be obtained.
All that it remains for me to do, and I shall not go right through the clause, is to point out to your Lordships that the passages in the Bill and the passages I have rewritten do not differ in intent apart from the question of written consent of the child. The same is said but in half the number of lines.
5.30 p.m.
As regards the consent of the child over 16 being necessary, that is included in paragraph (b)(iii) of my amendment. Unless the father and mother go along together to sign the register either the father or the mother must produce,
"declarations by both of them in the prescribed form stating that they are the parents"
or
"a certified copy of a relevant order"
and
"in either case, if the child is over sixteen, the written consent of the child."
The Bill as it stands states that,
"no person shall as father of the child be required to give information".
Why does not the Bill just say,
"the father of the child shall not be required to give information"?
The Bill says in subsection (1)(a), at line 35,
"at the joint request of the mother and the person stating himself to he the father of the child".
Why does the Bill not just say,
"at the joint request of the father and mother"?
I shall not go through it line by line, but I feel that it is a terrible pity that there is this reversion to the language and attitude of mind towards this problem in this clause when it does not occur anywhere else in the Bill. It is with some depth of feeling, therefore, that I beg to move.
5.30 p.m.
Lord Campbell of Alloway: My Lords, I shall be brief. I regret that I cannot support the point concerning the father. I understand what is being said but it ignores totally the drafting of the 1953 statute which it is intended to amend. One must keep some symmetry between the original form of the statute and the proposed amendment to it. To some degree, that cuts across the other point taken previously. Although one could say that old statutes should be better drafted, this is hardly the occasion on which to improve on the drafting as there should be some symmetry between the amendment and the original Act. Therefore I cannot support the amendment as it stands.
However, as regards the consent of the child being obtained, if the child is over 16 my noble and learned friend may well think that there is something in this. For example, in affiliation proceedings under the Children Act 1975 the consent of the child, if over 16, is always required. Perhaps my noble and learned friend could consider that point
The Lord Chancellor: My Lords, I find some difficulty in understanding the reasoning behind this amendment, which I only saw rather late. On the first point, a person cannot be described as the father of the child until the proceedings are at an end. Therefore, to call him the father of the child in advance is to beg the question which the proceedings are about. In fact, in new Section 10 of the Births and Deaths Registration Act 1953, which this clause intends to insert in that Act, the words, "that person" where they occur in, say, subsection (1)(b)(i) are used as a shorthand expression for the person stating himself to be the father or the person whom the mother states to be the father and who himself in subparagraph (ii) makes a statutory declaration to that effect. I do not know any other way of doing it, because the fact of his paternity is only to be established after the proceedings are complete. Therefore, this is a question-begging amendment on the first point made by the noble Lord, Lord Kilbracken.
The issue of the child's consent was dealt with by the Law Commission in its 1982 report on illegitimacy.
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My understanding is that it came to the same conclusion as is now in the Bill. May I say to my noble friend Lord Campbell of Alloway that it is, of course, true that in affiliation proceedings, which are abolished by the Bill as such, the child's written consent to the registration is required under present law if the child is over 16. This rule was originally introduced, as noble Lords probably know, by the Children Act 1975. It reflects the fact that in affiliation proceedings, being designed primarily for financial support, the child's interests would not otherwise be considered in the context of a finding of paternity and subsequent birth re-registration. Accordingly, it is provided in the new Section 10(1)(d) that if the child is of such an age that it would be appropriate to take his views into account—and 16 is taken as such an age—his consent is required to be in writing.
That seems to me to be absolutely sound, but in paragraphs (a)(b) and (c) registration or re-registration is effected as a matter of fact and on the evidence prescribed by agreement between the father and the mother. It is question of fact. One cannot say that consent is required to register a fact, if it proved to be a fact. What is required is proof of the fact. Therefore, the clause as drafted seems to me to prevail and I am unable to advise the House to accept the amendment.
Lord Kilbracken: My Lords, I did not think that the noble and learned Lord would accept the amendment, but I want to reply to the point that he made. In such a case there is no question about the identity of the father and the mother. If the identity of the father is in doubt—and it almost always is the father—he must undergo blood tests, and so on. But what is happening here is that two people present themselves and say, "I am the father and this is the mother and we want to register the child." Alternatively, one says, "I am the father and here is a declaration by the mother stating that I am the father and I want to register myself as being the father." After all, that is what happens if a married couple have a child. The father or the mother registers the child. The man may not be the father but she probably is the mother. The father may be someone quite different, without any use of AID. The husband may not even know that someone else is the father. However, if he goes along and fills in the register then his name will be put down as the father and the wife's name registered as the mother and no one asks any more about it.
I see no reason at all in a case like this, where two people declare that they are the parents, why that should not be accepted. I realise that this proposal is probably too radical to have any hope of acceptance by the noble and learned Lord on the Woolsack and therefore, though I feel strongly about it and would much like to see the amendment accepted, in the hope that what I have said may have generated some thought among your Lordships, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Lord Chancellor: My Lords, we now come to Amendment No. 17, tabled in the name of the noble and learned Lord, Lord Denning. The noble and learned Lord is not present and so the amendment is not moved. That saves me a certain amount of bother.

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There now follows Amendment No. 18, also in the name of the noble and learned Lord, Lord Denning, which is likewise not moved.
[Amendments Nos. 17 and 18 not moved. ]
Clause 27 [Artificial insemination]:
[Amendments Nos. 19 and 20 not moved. ]
Lord Meston Lord Meston moved Amendment No. 21:
Page 18, line 28, at end insert—
("( ) In this section "artificial insemination" shall include any form of assisted insemination whether inside or outside the womb and whether using donated semen or donated ova.").
The noble Lord said: My Lords, I am conscious of the fact that it is intended by the right reverend Prelate to have a wider debate on Clause 27 and therefore I shall not detain your Lordships at any length on my amendment.
Assuming that Clause 27 remains in this Bill, I suggest that my amendment is necessary. Until the noble and learned Lord the Lord Chancellor moved Amendment No. 3 there was no indication in the Bill that it was specifically intended to cover children born as a result of in vitro fertilisation by donated sperm. We now know that the Bill in general is intended also to recognise in vitro techniques, and for that of course we are grateful. I shall have to consider perhaps at a later stage whether or not it is now necessary specifically to refer to in vitro births in relation to Clause 27 alone.
However, the concern of this amendment is frankly wider. It is to ensure that Clause 27 should cover all forms of assisted birth undertaken consensually by a married couple. The logic of the noble and learned Lord the Lord Chancellor, with which, if I may say so, he has argued forcibly both at Second Reading and at Committee stage in support of Clause 27, is, I suggest, quite unaswerable. His argument is that it is simply unfair not to give status to children born consensually in wedlock with the full agreement of both parties to the marriage.
I simply invite the House to extend the logic of his argument and allow Clause 27 to cover all children produced by any technique whose genetic inheritance in fact only comes from one or other of the couple who intend to bring up the child. The report of the committee under the chairmanship of the noble Baroness, Lady Warnock, certainly took the view that egg donation should be covered, and as I understand it that was the purpose of what I think was one of the least controversial amendments in the name of the noble and learned Lord, Lord Denning; namely, the second part of his Amendment No. 19.
I invite the House to allow the logic of the noble and learned Lord to be extended to all forms of assisted birth so that it is not necessary to legislate piecemeal in this difficult area. I beg to move.
Lord Robertson of Oakridge: My Lords, there may well be much merit in this amendment but I should like to point out one fact; namely, that this is one of the specific subjects on which the DHSS consultative paper that was published only last month, Legislation on Human Infertility Services and Embryo Research,
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called for views at paragraph 28. It would seem wrong for your Lordships' House to anticipate the collection and study of those views.
5.45 p.m.
The Lord Chancellor: My Lords, it seems that no other noble Lord has risen to speak. The noble Lord, Lord Meston, always talks very good sense, if he will allow me to say so, and I have considerable sympathy with this amendment; but I shall tell him why I am rather reluctant to accept it and I hope that he will believe it is a valid reason.
I had to tread a rather delicate path in this Bill, as must have been obvious both at Second Reading and at Committee stage. I reached the conclusion, with which I was happy to note the noble and learned Lord, Lord Silkin, agreed, that I could not very well propose a Bill on illegitimacy without clarifying to some extent and at least provisionally the case of the child born as a result of AID, and I have been happy to make it quite clear that I also intended to include in vitro fertilisation.
It was the noble Lord, Lord Robertson of Oakridge, I think (I am so shortsighted that I cannot be quite sure), who, from the Cross-Benches pointed out that there were people who thought I was jumping the gun on the question of the Warnock Committee. Frankly, I agree that this is a delicate path to tread. I thought that I must introduce Clause 27, despite a very respectable body of opinion that said that I should not do so, out of a sense of sheer justice to the children born of artificial insemination.
I myself am not necessarily opposed to extending this principle to children born as a result of egg or embryo donation. I do not want to prejudge that question but I am not necessarily hostile to it at all and I have a great deal of sympathy with it. As the noble Lord, Lord Meston, quite accurately said, such was the Warnock recommendation. However, I have to consider the views of those who think that I am jumping the gun on the Warnock Report. I have been trying not to do so more than was absolutely necessary in justice to the child born of AID or in vitro fertilisation, and I think that I should be going too far if I accepted this amendment.
The Government have recently sent out a consultative document on the Warnock Report entitled Legislation on Human Infertility Services and Embryo Research. Having sent out that document for consultation they have asked for other people's views on the subject before they legislate. I must point out that in neither of the draft Bills attached to the Law Commission's reports was there a provision on the lines now proposed in this amendment. I know that what I am treading is a delicate path, but the view which I am asking the House to accept is that I was right to include some provision in relation to children conceived by AID and in vitro but that if I went this further stage, which it certainly can be argued is a perfectly logical extension, I should be pre-empting the consultative document and the legislation on Warnock.
I know that it is a difficult road to tread, but it is the path that I have chosen. I would ask the House and the noble Lord, who always talks such good sense, to back

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me on this. It is a matter which is open to argument—whether I was right or wrong. No one claims to be infallible in this House, least of all me. There it is. I think that I have gone as far as I can.
Lord Renton: My Lords, we should take note of what the noble and learned Lord has said. It is not only he but all of us who are in this somewhat embarrassing position because, on the one hand, we want to fulfil the purposes of the Bill as expressed in the Long Title and in Clause 1(1); but, on the other hand, we know perfectly well that there may be legislation following Warnock which will conflict with some of the matters dealt with in the Bill which would accordingly have to be amended if that legislation were passed.
I mention only the possibility that certain kinds of surrogate motherhood may be decided by Parliament to be illegal. In that case, there would have to be consequential amendments to this Bill. We cannot help that. We must try to fulfil the declared purposes of the Bill without, as my noble and learned friend has said, going too far. For that reason, if I may respectfully say so, I support the view that he has taken on this amendment.
Lord Meston: My Lords, I am grateful to the noble and learned Lord the Lord Chancellor for his sympathy. I had hoped to push him a little further down the delicate path he described himself as having trodden. This Bill has the intention of providing a broad framework for children who are born after the Bill becomes law. Science is not standing still. As always, the law must try to catch up. I of course accept what the noble and learned Lord says. It may mean that there will have to be amendments to the Bill at a later stage, possibly after we have considered further legislation resulting from the Warnock Report. However, with a certain degree of reluctance, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Lord Bishop of Birmingham The Lord Bishop of Birmingham moved Amendment No. 22:
Leave out Clause 27.
The right reverend Prelate said: My Lords, unlike most noble Lords who have spoken on Report, I am not a lawyer only a bishop; nonetheless, it seems to me appropriate to bring this amendment before your Lordships' House again on report as there was no Division on the subject when it was considered briefly in Committee.
Secondly, there are some important considerations which were not mentioned in Committee. Thirdly, since then the consultation paper which the noble and learned Lord the Lord Chancellor has mentioned on legislation on human infertility services and embryo research has been issued, which, as I understand it, greatly alters the situation and makes it impossible to walk as delicately as Agag in this matter with the Bill as it now stands.
I must begin with an apology. I was unavoidably absent when the matter was discussed in Committee. I thought it right to keep an engagement made previously to entertain in my house all the Roman Catholic and Church of England bishops in the West
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Midlands to discuss important matters with them. I knew that amendments standing in my name were in the capable hands of the noble and learned Lord, Lord Denning. I must admit that I was a bit distressed when I read the Official Report to find that the noble and learned Lord the Lord Chancellor had seen fit to describe my absence as the absence of the chairman of the "board of social irresponsibility".
The Lord Chancellor: My Lords, I immediately tender an unreserved apology if I caused any distress. I am afraid that my levity was unsuitable and I apologise.
The Lord Bishop of Birmingham: My Lords, I am grateful to the noble and learned Lord on the Woolsack for his courtesy in withdrawing that remark. I would wish him to call me irresponsible whenever I am, but not the board which I happen to chair.
When the noble and learned Lord spoke at that time he said that the consultation document would be issued in connection with the proposals of the Warnock Committee. That consultation document may not be in all your Lordships' hands. It came to me as chairman of the Board for Social Responsibility. I shall therefore have to quote a little from it. It deals at length with matters of AID among others. It deals with them on two counts. The first concerns access to genetical information about an AID birth, and secondly it concerns the registration of that birth.
Those matters are not unconnected. If there is no information available about the details of the donor, there is no information to which the person born in such a way can have access. I appreciate that the noble and learned Lord informed the right reverend Prelate the Bishop of London on Second Reading (and repeated it in Committee) that Clause 27, if passed as it stands, would not prejudice questions of access to be discussed when the Warnock proposals come to legislation. As I have said, however, it is impossible entirely to disconnect the two matters of access and registration.
I feel that I must quote parts of the consultation document which I note comes from the Department of Health and Social Security but which has been presented to Parliament by the noble and learned Lord the Lord Chancellor as well as other Secretaries of State. It states:
"There was little support in the response to the Warnock Report for the proposal for an optional 'by donation' annotation of the birth register. It was recognised that the child must have a birth certificate which concealed the facts about his conception but there was a strongly held view that the legal father should be allowed to enter his name on the birth register only if the entry could be linked by the Registrar General with a central record of AID births (which could be the responsibility of a statutory licensing authority)."
That was thought to be essential, first, to maintain the integrity and reliability of the birth register as a record of biological fact; secondly, to ensure the child's right of access as an adult to an accurate record of the biological facts of his birth and to the information about the donor held on a central record; and, thirdly, to give an AID child who wished to marry the opportunity to ensure that there was no prohibited relationship with the intended spouse. That would only be possible if the donor's name were recorded in the central record.

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Your Lordships will know that that deals with an alternative to the addition of "by donation" on the original record of birth; that is to say, a central record of AID births. It seems to me that it is not possible to consider adding "by donation" to the original record of birth unless we also consider the alternative put forward in this consultation paper. For that reason I have not brought forward my earlier amendment which today stood in the name of the noble and learned Lord, Lord Denning, and which has not been moved. Surely those matters must be discussed together as the Law Commission suggested. They must be discussed when we come to legislate about matters concerned with the Warnock Report as a whole.
How can we agree to Clause 27 unless we are assured of the accuracy of the birth register as a record of biological fact? Here again, I fear that I must quote from the consultation document. This passage is in heavy type:
"The Government would find it helpful to have further views on the way in which a system of registering and recording children born as a result of AID or egg or embryo donation might be set up which (a) would best meet the child's need for access to the truth about his genetic origins and some information about his genetic father and satisfy the family's need for privacy and take account of the donor's wish for anonymity".
The Government have said that they would welcome views upon the information which should be held at the point of treatment by any statutory licensing body—by the Registrar-General. They would also welcome views about whether information on donors should be anonymised in all records or whether the donor's identity should be recorded, and, if so, whether it should be made available in any circumstances to the Registrar-General and to the child should he or she, on reaching maturity, wish to know. This is not very satisfactorily expressed. A child born through egg or embryo donation would not need to know information only about his genetic father, but about his genetic mother in the one case and about both his genetic father and genetic mother in the case of embryo donation. Again, the verb "to anonymise" is unknown to my dictionary. I suggest that it should continue to be unknown in the English language. Nonetheless, the sense of the passages which I have quoted is clear.
The consultation paper is asking for views on the subject of registering and recording the births of children born through AID. We are legislating today as though no consultation were to take place. I say this with great respect. It seems to me that this brings into disrepute the process of consultation. I am even tempted to say that the left hand does not perhaps know what the right hand is doing. It is not for me to say whether this is a sinister development or simply the result of governmental dexterity, but they seem a little confused. If Clause 27 stands part of the Bill then surely the noble and learned Lord the Lord Chancellor, together with the other Ministers in whose name the consultation paper is issued, ought to withdraw that part of the paper which asks for views about the registration of births of children born through AID.
There are also other considerations. The noble and learned Lord the Lord Chancellor said on Committee, and repeated today, that it would be a matter of gross injustice to deal with the case of a child born out of
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wedlock but not to deal with the position of a child born in wedlock by AID with the consent of the married couple. We have not wholly dealt with the case of a child born by AID. There are three modes: by artificial insemination through syringe; by in vitro fertilisation; and by the method which is mentioned in the consultation paper and which I saw today taking place in a hospital, known as GIFT: gamete intra fallopial transfers. We have not dealt with the last method.
Obviously the noble and learned Lord the Lord Chancellor makes a very powerful point which commands our sympathy about justice being done to a child born in AID. But what about a child born through egg or embryo donation? I watched this happening today. This procedure is taking place, and children are born. There is no law to prevent it because we have no legislation brought forward in connection with the Warnock Report. People are free—most of them do it very responsibly—to preside over procedures which bring to birth a child through egg and embryo donation. To legislate for children born through AID but not to legislate for children born as a result of egg and embryo donation is—to use the words which have already been employed—committing a gross injustice against them. We could be said to be setting a precedent by legislating for AID children, for those born through egg and embryo donation. It seems strange to register a child in the names of a social father and a social mother, neither of whom has contributed anything genetic towards the child, as would be the case in embryo donation. This legislation seems to be setting a precedent.
These are very complex matters. It seems to me that we ought to know more about the medical techniques and possibilities before we start legislating. Surely we must look at all these factors together. If the DHSS has asked for consultation, surely the process of consultation must run its course before Parliament begins to legislate. Surely we ought to legislate for children born by AID and egg and embryo donation together. Surely we ought to consider matters of access and registration together, because the two are intimately connected.
I appreciate the need for appropriate privacy on the part of a child born in this way. I should have thought that the shorter birth certificate gave quite sufficient privacy for practical purposes to him or her and his social parent. But surely it is the duty of your Lordships' House to reject legislation which destroys the integrity and reliability of the birth register as a record of biological fact. I am somewhat shocked to find that your Lordships' House, if it passes this legislation, seems to be inviting people to act against the spirit of the Perjury Act. Surely we ought to take the advice of the Law Commission and wait until all the Warnock legislation is before us so that we can consider it as a whole. Those are the reasons I am glad to move that Clause 27 be left out of the Bill.
Lord Renton: My Lords, the right reverend Prelate has drawn attention to a number of risks, biological, social and legal, which he fears as a result of what he calls "this legislation" although he is referring to Clause 27 in particular.

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We ought to take note of the risks to which he refers. There is no doubt that the Bill does not purport to deal with all of them. The Bill is attempting to deal with various situations which have already arisen and trying to drive some legal sense into what many of us would regard as unwelcome human practices. That is true though. However, the question we have to decide is whether leaving out Clause 27 will overcome those risks, or any of them. I seriously doubt whether it will.
I mention one very serious risk to which we ought at some time to apply our minds with great care. That is the biological risk that, through artificial insemination or its indirect results, a child may be born in or out of wedlock to parents who should not be causing the birth of such a child because their association is within the prohibited degrees of consanguinity, as recognised in the Church of England of which the right reverend Prelate is a bishop.
However, leaving out this clause would not overcome that problem. I do not wish to make a long speech, although it is tempting to do so because the right reverend Prelate has made a great deal of ground and we should regard what he has said with great seriousness. However, on this particular point I am quite sure that we should leave this clause in the Bill.
Lord Simon of Glaisdale: My Lords, obviously the argument is very nicely balanced. On balance, I am persuaded by the right reverend Prelate, and I should like to see the clause left out. That is obviously the preference of the Law Commission, on which my noble and learned friend on the Woolsack has so greatly relied.
Perhaps I may say that what the clause does is really much less momentous than had been sometimes supposed: it applies age-old common law and canon law rules to the new practice of AID. If a child was born possibly as a result of an adulterous union, the husband would have to prove that fact affirmatively. What is more, there would be a presumption that he had consented, and it would be for him to prove that there was no consent on his part. I know that those rules have been abrogated by the 1969 legislation, now consolidated, although, to my mind, not to the improvement of the law generally. However, applying those rules, all the clause really says is that it is for the husband to prove that he did not consent; and that unless he proves that, this child, like any child born in wedlock, will be presumed to be a child of the marriage. Although the clause is less momentous than has been pretended, nevertheless, if the right reverend Prelate should divide your Lordships' House I shall follow him into the Division Lobby because I think that on narrow balance he has made out the case.
Lord Meston: My Lords, I urge your Lordships to allow Clause 27 to stand. Indeed, I hope that it is a clause which sets a precedent. I remind your Lordships that the Bill in general, and this clause in particular, is concerned with the welfare of children. It provides a legal framework only and it attempts to remove unnecessary legal disabilities. The Law Commission recognised that it ought to tackle AID and AID children, but again only in the context of providing a legal framework.
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At page 170 of its first report the Law Commission said this:
"In this report we are only concerned to make limited proposals to deal with the legal status of a child who, though conceived with the assistance of AID, is in social reality the child of the mother and her husband".
The Warnock Committee approved the recommendations of the first Law Commission Report and gave its own clear suggestions. At Second Reading and in Committee the noble and learned Lord the Lord Chancellor forcefully argued that it would be unfair to single out AID children for disadvantageous treatment by the law.
Of course, where one has an anonymous donor there will be problems of registration and access, and again the Warnock Committee made specific recommendations in that regard. Frankly, the problems of registration can be overcome. At the end of the day, I suggest that the welfare of the child, and in particular the security and legal status of that child, are more important than the integrity and the mechanics of the registration of births.
I venture to agree with the noble and learned Lord, Lord Simon of Glaisdale, that what is proposed in Clause 27 is not as momentous as might be suggested. It is a form of antenatal adoption, as I read it. It is certainly right that the law must recognise and secure the status of such children. Indeed, the law should not put obstacles in the way of such children.
This is not a Bill to regulate AID or any other artificial techniques. As was said at the beginning of the afternoon, it is a Bill in broad and general terms as to the status of children. The fact is that AID is practised and it is lawful. It does not matter to the child, who is the outcome of that technique, whether the AID was regulated or unregulated. It does not matter whether or not the regulations governing AID were mandatory. The fact of the matter is that the child must have its status protected and secured so far as the law can achieve that. That is not to say that sooner or later—I hope that it is sooner rather than later—the proper regulation in accordance with the Warnock recommendations will not come into force. Meanwhile, Clause 27 does not hinder further legislation in accordance with the Warnock recommendations and, if anything, I suggest that it helps the process.
6.15 p.m.
Lord Mishcon: My Lords, it is my pleasure to follow the noble Lord, Lord Meston, largely because I agreed with everything that he said. I therefore do not intend to repeat his speech, which I am sure was warmly received by the House. I say with him that the welfare of the child is pre-eminently in our mind, as it is in all our recent legislation dealing with children. The whole purpose of the Bill is the eye that the law now casts—which is a very different look from the previous aspects of the law—upon the protection that the law can give to the dignity of a child born illegitimately through no fault of its own.
As has been said, we are dealing here with a very narrow area indeed. We are dealing with people who have married and are still married. We are dealing with one of the parties who finds it impossible to have a child: the blessing of children. How appropriate that the word "donation" was used in various amendments

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and various speeches! They have been deprived of the donation of a child through ordinary means. As a result, they have done what is perfectly legal in our law as it stands at the moment: they have decided to take advantage of artificial insemination.
Furthermore, in this clause we are dealing with two parties to that marriage who are ad idem as to what they want to happen. That is, that they wish to be regarded in society, and in their relationships with that child, as the proper, lawful parents of that child. So far, in sheer humanity and with the aspect, as I have said, that the law now wishes to adopt in regard to children, how right it is that the law should now say: "If this be the parents' wish in regard to that child, we shall so regard it".
When dealing with the Bill are we to say that we are not to look at the matter because of the debate which is going to take place generally in regard to the Warnock Report? I think that we would be failing in our duty if this clause was not included. To deprive these children of the protection of the Bill would be very wrong.
May I take the discussion a little further? I believe I am right in saying that this point was raised in Committee. If I remember correctly, the noble and learned Lord the Lord Chancellor placed some emphasis upon it. I wish also to place some emphasis upon it. The law, in my humble view, must never create a situation where the law is placed in contempt or where the law is not enforceable against decent citizens because it would be wrong to enforce it.
What is to be the position in regard to registration and generally in regard to declarations made by parents who come within Clause 27? Are we to say, in certain circumstances when a statutory declaration is made about parenthood or statements are made to the registrar of births, that they are guilty of perjury? Which of us sitting in a Director of Public Prosecutions' office, which of us sitting as a prosecuting solicitor, would ever advocate a prosecution of that kind? Indeed, even if it were advocated, where would be the proof that the prosecution would want or would be able to bring before the court?
The clause ought to be included. It would be wanting in duty for the House not to have such a clause as Clause 27 in the Bill.
Lord Kilbracken: My Lords, I am sorry to disagree with my noble friend on the Front Bench, but I should like to support the right reverend Prelate for all the reasons he has expressed and, therefore, I do not propose to repeat.
I want to draw attention in particular to a certain point in the clause that I think underlines the need to withdraw the clause so that it can be more fully considered. It is a matter that should particularly concern your Lordships because I want to talk about the effect, or lack of effect, of Clause 27(3). As your Lordships know, it states:
"Nothing in this section shall affect the succession to any dignity or title of honour or render any person capable of succeeding to or transmitting a right to succeed to any such dignity or title".
We are talking about artificial insemination, in particular AID. I want to put to your Lordships the
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case of a hereditary Member of your Lordships' House who, for whatever reason, is incapable of fathering an heir. In such a case, he and his wife may decide to avail themselves of AID. They go along to the hospital in complete confidentiality; the semen of a donor is inseminated; and, in due course, a child is born. In such a case, if the husband is not a hereditary peer, there can be no doubt that the child is registered and regarded and accepted as the legal, natural and absolute son of his father. The husband and wife are counselled that, if they have intercourse around the period when conception would be expected to take place and when insemination does take place, they will never really know—although the husband has been proved to be impotent or sterile—and the public will certainly never know that the child is not in fact the biological son of the husband.
This question was raised in Committee on a different matter by the noble Lord, Lord Robertson of Oakridge. He pointed out that it would be very easy in such cases to establish whether the husband was in fact the natural father by taking blood tests, by tissue typing or by DNA analysis. However, your Lordships will remember that that suggestion was most severely censured by the noble and learned Lord on the Woolsack who described it (I cannot quote him verbatim) as a very serious infringement of personal liberties. Therefore, when a child is conceived in this way in any other case, if he happens not to be a hereditary peer or the heir apparent to a hereditary peerage, it is considered a great infringement of personal liberties to insist upon a blood test to establish the identity of the child.
What happens in this case? What happens when Lady X has this baby—it has nothing whatever to do with her husband's ancestry—and presents him, as all other mothers and fathers do in these circumstances, as heir to a peerage in your Lordships' House? The answer is that she simply says, "This is my son"; and the husband, the peer of the realm, says, "This is my son, he is registered as such". In due course, he comes and sits in your Lordships' House, and good luck to him.
I ask only whether that is the intention of subsection (3). There is no believable way in which his right to sit in this House can be disputed. This gives a new meaning to the word "affect" in line 26:
"Nothing in this section shall affect the succession to any dignity or title of honour".
It may be that this is happening all the time, and that lots and lots of AID babies, after they have grown up and their fathers have died, come and sit in this House. I would not mind a bit. I am just drawing attention to it. But the subsection states,
"Nothing in this section shall affect the succession".
This means that they can go on doing it and that it is perfectly all right. I just wonder what the subsection means. If that is not the meaning, it seems to mean that to use AID to father a future hereditary peer is wrong, and people have to stop doing it, but there is no way in which they can be stopped doing it.
It is no good saying that they have to apply for a writ of summons and that the new peer has to provide documentary evidence that he is the son because, as far as he knows, he is. His father and mother are not

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going to come along and say, "Look, Charlie, sorry, but you are not really your father's son at all, you are the son of a donor". They are never going to reveal that he is not a true son and heir. He thinks he is. Of course he is going to apply for a writ of summons, which he will get. If that is challenged, what happens then? No one can take a blood test from his father at this stage because his father is dead and buried—perhaps cremated. They could exhume him if he had not been cremated and take a posthumous blood test or tissue sample. They are hardly likely to go to those lengths.
If this happens, even if it is disputed, there is no way it can be proved one way or the other. If he is sitting in this House, his father has to be dead. So he comes and sits here and ends up on the Government Front Bench. I think that is fine. There is a whole area that has not been explored and that ought to be explored. Until it has been explored, I think the whole clause should be removed from the Bill.
6.30 p.m.
Lord Hylton: My Lords, I shall not follow the noble Lord, Lord Kilbracken, into the highways and byways of Peerage law. However, I should like to support the right reverend Prelate in his amendment. I suggest that the deletion of this clause will force the Government to think again and to come back with a better text than the one we have now, in particular taking into account the very important points that were made in Amendments Nos. 18, 19 and 20 but which we have unfortunately not been able to discuss this evening.
The right reverend Prelate made one most important point about access to the biological truth being provided for the child when it comes of age. I suggest this is in the interests and for the welfare of the child. If your Lordships can think back to the Children Act 1975, a very similar provision was made for adopted children when they come of age to be able to discover their true parents. It is on those grounds that I support the right reverend Prelate. I hope the Government will have second thoughts.
Lord Houghton of Sowerby: My Lords, I have not said a single word on this Bill throughout all its stages so far. That is not because I was not interested in what it was proposing to do, but because I was so warmly in support of the ethos of the Bill. I congratulate the Government on their courage and the comprehensive way in which they have tried to amend the cruel laws of illegitimacy. How cruel the Church can be. How cruel moralists can be on matters of this kind. I deplore the attempt to remove this clause from the Bill.
If noble Lords wish to consider this amendment in relation to other amendments that have not been discussed today, there is still a further stage at which it can be done. I have listened to all the debate. I have been here all day, and there is nothing that has been said which discourages me from supporting Clause 27 of the Bill. After all, whose interests are we trying to serve? It is the interests of the children, the interests of their desire for security and stability in their lives and to be able to face social prejudice and religious doctrine which often comes into matters of this kind.
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I support the noble and learned Lord the Lord Chancellor wholeheartedly in his remarks on the Committee stage that this is not a religious matter. It is always somewhat misleading, if I may say so with great respect, when right reverend Prelates on the Bishops' Bench rise to speak on matters which are not religious matters and use their authority as bishops of the Church of England to express a point of view. We have to be careful. In principle, this is a layman's matter. Maybe it is a lawyer's matter on the intricacies of the situation.
I do not accept that there is any divine law or any fundamental law in our system of the registration of births. The registration of a birth is what society wants it to be. Mostly it wants it to be a record of the parentage of a person who is born in wedlock. We have done some cruel things to children who are not born in wedlock. When I think of the struggle that some people have made throughout their lives against the stigma of illegitimacy I wonder what board of social responsibility ever condoned what they were made to suffer. Ramsay MacDonald, Ernest Bevin and J. H. Thomas all had to fight against this stigma throughout their lives.
It is much more important that a child should feel secure in its home and in its parents than that it should know in every case what is described by the right reverend Prelate as the biological fact. It is not fundamentally important that a child should know the biological fact if the registration of birth gives him or her a clean bill of legitimacy within the law and within the family. That is what children want. They do not want AID put against their names or a separate register of those who are born in some peculiar way. They want to feel that they were born properly of their mothers. After all, the mother is the person in birth. Social law and social habits have not worried too much in the past who the fathers were. The important thing was that a child should have a mother and a mother's care. The mother will be there under this proposal.
I sincerely hope that we are going to regard the interests of the children and free them from doubt, difficulty and stigma. I do so support what I thought was the most persuasive case put by my noble friend Lord Mishcon.
All through the history of these social and moral issues we have had to resist prejudicial and religious dogma. One considers that a Bill to remove the ban on the marriage of a man to his deceased wife's sister had to pass 11 times through the House of Commons, and was blocked 11 times in this Chamber. Gilbert and Sullivan wrote a ditty about it: "The Annual Blister, the Deceased Wife's Sister". Asquith decided that this nonsense should end, and it was passed in your Lordships' House when the right reverend Prelates walked out and let the heathens pass that into law.
In the circumstances we have to regard with some suspicion the source from which objection comes. This is a common or garden matter affecting children. It is their happiness and their sense of security that we must place first. That is my verdict. I am sorry I did not come in on this Bill before but I have read it and I was present during the Committee stage. The same noble Lords appear, saying the same things on these

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issues. I shall be surprised if we do not get more of it before this debate has come to an end.
For my part I say, leave it alone. This is the best solution to a complicated matter. When life is complicated by scientific and biological research and development one has to protect the innocent people of new processes of human relationships from the awful consequences that can ensue. I feel strongly about this matter.
Lord Elwyn-Jones: My Lords, lest my silence be misunderstood, I rise to support the retention of Clause 27 in the Bill. There was one moving observation expressed by the noble Baroness, Lady Faithfull, earlier in the discussion on this Bill. The noble Baroness said that the Bill makes all children equal, including the children that come within the category of artificial insemination. It is a basic thought and a basic approach. If we look at the matter from that point of view, Christians must surely be in favour of that proposition, of which I am sure the founder of our faith would have approved.
Lord Robertson of Oakridge: My Lords, the main question before us is how the children's interest is best served? I fear that it is not best served if we go out of our way to deceive the child concerned about its parentage. That is not the way to build a sound parent-child relationship. I dread to think what would be the effect on the child if and when he or she finally discovers that he or she has been deceived about his or her parentage.
The Lord Chancellor: My Lords, we have had a fairly full debate I defended Clause 27 on Second Reading, and I was supported by the noble and learned Lord, Lord Silkin. I supported Clause 27 in Committee, and I believe that the sense of the Committee was then in my favour. I rise to support it again without apology for what I have done.
I do so partly on moral grounds, which have been well expressed—better expressed than in any words I might choose—by the noble Lords, Lord Mishcon and Lord Houghton of Sowerby, neither of whom belong to my own party or to my own Church, which is that of the right reverend Prelate. He said he was only a bishop. Well, I am only a layman, and I do not know that it puts me in a superior position to him. I feel strongly on moral grounds, but I also intend to approach this on a more practical ground. A great mistake has been made, I believe, by those who support this amendment in thinking that we are dealing with a new problem created by the marvels of science and AID.
Let me pose a case to the right reverend Prelate. A man has been married for 20 years to a wife whom he loves. She has been guilty of perhaps a single act of infidelity. A child is born of whom the husband knows that he is not the father. I wonder how many people have read some recent biographies, for instance Mr. Ziegler's biography of the late Diana Cooper, a personal friend of mine. He said quite plainly that her true father was not the father who was registered. But her father, who was a duke, no doubt registered that child with himself as the father. I wonder whether any-
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one has read the recent biography by my honourable friend Mr. Robert Rhodes James, the Member for Cambridge, of Anthony Eden, the Prime Minister, to whom we paid legitimate tribute. He places the true paternity of that child not as his baronet father, if I may say so to the noble Lord, Lord Kilbracken, but to a certain George Wyndham, and says that Anthony Eden himself believed it. I wonder how many of us have read the Ampthill case that went on for a very long time and was ultimately decided by your Lordships' Committee for Privileges, on which my father appeared on one side and I, about 30 years later on another.
We are not facing a new problem because these children are engendered by AID. I would say firmly to the right reverend Prelate that a man who registers a child which he knows is not his own, born in wedlock, but still allows his name to be put forward as the father of that child, may be committing a technical offence under the Perjury Act. It is not perjury in the theological sense because he does not take an oath. But he is committing a technical offence which, as Lord Chancellor, I cannot condone. However, as a layman of the Church of England I may think very differently. I may think that he is doing a compassionate and Christian act.
I must remind the right reverend Prelate that the festival of Christmas has just passed. One of the Gospels during that festival is the first few chapters of St. Matthew. There was a man there who took his affianced wife to Bethlehem and found that she was with child of which he was not the father. He brought up that child as his own child and the child was commonly accepted as the child of the marriage. I am now talking to a prelate of the Church of England. Did he do right, or did he do wrong? He was minded at first to put her away privily but decided not to in order to save himself the publicity because he was warned in what was called a dream that the child was to be brought up as his own child. I am not prepared to say, as a Christian, as a member of the Church of England, that man who, by the ordinary process of generation, puts himself down as the father of a child whom he knows not to be his, but who chooses to continue to be married to the woman he loves and has perhaps lived with for 20 years, is necessarily committing a moral sin. Of course, I cannot condone a technical offence against the Perjury Act. Has anyone read the biographies of Scawen Blunt, for instance, or Harry Cust? There are all these well-known people. The children of those encounters were all allowed to be registered as children of the marriage. The age-long doctrine of the Church has been that the presumption is that a child born in wedlock should be treated as legitimate unless the contrary is absolutely proved.
I am not persuaded that when these children are born of the new presence of donation, we are necessarily dealing with a new problem. We are dealing with a very old problem. What is happening in these cases, dealt with by Clause 27 of the Bill, is that both parents have consented to what has been done.
I must tell the right reverend Prelate, and urge the House to believe, that this is going on legally every day of the week; the children are in fact being registered as children of the marriage. Therefore, technical offences are being committed. Is the right reverend Prelate

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seriously telling us, as chairman of the Board for Social Responsibility, that they will stop going on if we do not pass Clause 27? What we shall be doing, if we do not pass Clause 27 is encouraging them to go on doing it because no-one will ever know. Is the fact that there are other methods now of creating children (of which neither parent is the biological author, whose being is the biological author, like surrogate motherhood which is dealt with by Warnock in the consultation paper) going to deter us from doing our manifest duty under the Bill? For there are further complications, and no doubt science will proceed. I frankly tell the House it was I who did it; I persuaded my colleagues and they followed me. It is quite true that a different view was put forward by the Law Commission, but I thought it was my duty to put this clause in the Bill and I have done so. So far as I am concerned, I am going on doing so.
6.45 p.m.
The Lord Bishop of Birmingham: My Lords, I have listened with as much care and attention as I can muster to what people have said against my amendment. I have tried to listen as sympathetically as I can. I must make clear that I did not argue on religious grounds. I argued on grounds of ethics, and I should be sorry to think that a bishop of the Church of England in your Lordships' Chamber may not argue on terms of ethics. Perhaps I could inform the noble Lord, Lord Houghton, that the Board for Social Responsibility recorded its view several years ago that it was against illegitimacy. I expressed my view in response to the gracious Speech from the Throne giving a welcome to this Bill with this one problem that I am raising. If it is of any interest to your Lordships' House my brother is married to his deceased wife's sister.
If I felt that either of my two arguments had been refuted, or if I felt that I was not suggesting something for the welfare of a child, I can assure your Lordships that I should withdraw my amendment. The noble and learned Lord, Lord Elwyn-Jones, said that we want all children to be equal. I understood him to say that. I hope I have quoted him correctly. So do I in moving this amendment. I want equality to be shared with children of egg and embryo donation as much as from AID.
I am actually in favour of AID in particular circumstances. I have said nothing against it. I am concerned about legislation for AID without legislation for those children born by other means. It seems to me to be a matter of gross injustice that one should be taken and the other should be left. I wish that I could have heard someone address himself to the moral point that I was trying to make in this respect.
I also referred to the process of consultation. No one has addressed himself to the process of consultation. Is it the case that the consultation is not really required, though it has been asked for? If I felt that those two points had been met I should certainly withdraw this amendment.
I do not want to get involved in this subject, and your Lordships' House would not wish me to be involved in it, but the person to whom the noble and
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learned Lord the Lord Chancellor referred in his speech did not, so far as I know, pretend that he was the father of the child of whom he was speaking.
The Lord Chancellor: My Lords, I think that the right reverend Prelate is wrong. It is clearly stated in the Gospels that the child was brought up as child of the family, with the other brothers and sisters, according to one view, of a previous marriage, and according to another view of that marriage. St. Paul in his Epistles clearly referred to, "after the manner of the flesh, of the seed of David". I think that the right reverend Prelate is wrong on his Gospels, too.
The Lord Bishop of Birmingham: My Lords, I must thank the noble and learned Lord the Lord Chancellor for his intervention, and I fear that we must agree to differ on this matter.
I am not convinced that anything I have suggested is contrary to the welfare of a child. As the noble and learned Lord the Lord Chancellor said, and indeed as the DHSS actually suggest in its leaflet—as the noble and learned Lord, Lord Denning, read out last time—the parents of an AID child are encouraged to have sexual intercourse during the period concerned and to register that child as their own. The noble and learned Lord said that this was a technical offence, as indeed I am sure your Lordships' House will agree, and that he was not convinced that that was a sin: and nor am I.
But it does not seem to me to be intolerable to continue this situation—as it has continued now for a considerable number of years—for a year or so further until we can deal with them all as a whole and not just take one particular category and say, "Oh, we won't bother about egg and embryo donation", which, as I said, I saw taking place today.
I appreciate that the Church has been cruel in the past, and so have other institutions, but I do not think that in this particular matter it is. In my experience I cannot see that the present situation in which an AID child is registered as the child of its social parents, or its social father and genetic mother, is a technical offence, and is against the welfare of a child in any way.
It would seem to me—and my judgment may be at fault; it often is—that it would be fairer just to let the matter go on for another year or so until the Warnock Report legislation is before us, so that we can deal fairly with the whole class, since there is no question of illegitimacy at the moment for those born of AID because they are registered as the children of the husband and wife.
It may be that what I say does not find favour in your Lordships' House. However, I feel that I must in honesty express the viewpoint that I hold and try to show to your Lordships the reasons why I am putting this amendment forward. I believe that it is not against the welfare of the children and that we need to consult further about this. It may not seem like that to your Lordships, but that is the reason that I put forward this amendment.
On Question, amendment negatived.
Clause 28 [Children of void marriages]:
Lord Kilbracken Lord Kilbracken moved Amendment No. 23:
Page 18, line 30, leave out from ("marriages)") to end of line 32 and insert ("for the words "the act of intercourse resulting in his birth" there shall be substituted the words "his conception or, if fertilisation took place in vitro, of the implantation that resulted in his birth" ").
The noble Lord said: My Lords, although this amendment has the dreaded asterisk beside the No. 23, I tabled it over a week ago and the asterisk is only because I made a small and insignificant change in it.
Clause 28 is concerned with amending the Legitimacy Act 1976. I want to consider it for a moment in the light of the question of in vitro fertilisation. Section 1 of the Legitimacy Act 1976, which I fortunately hold in my hand, is about the children of void marriages.
To abbreviate it a little, what it says is:
"The child of a void marriage … shall … be treated as the legitimate child of his parents if at the time of the act of intercourse resulting in the birth (or at the time of the celebration of the marriage if later) both or either of the parties reasonably believed that the marriage was valid".
If the mother thought that the marriage was valid at the time that intercourse took place and then it turned out that it was not valid, the child is still legitimate.
Under Clause 28 of this Bill that is changed by inserting the words:
"or, where there was no such act, his conception".
Therefore it would read:
"The child … shall … be treated as the legitimate child of his parents if at the time of the act of intercourse resulting in the birth (or, where there was no such act, his conception"
et cetera. The use of the word "conception" again would mean, in the case of in vitro fertilisation, where conception takes place at the time the sperm and the ova meet in the dish, that conception then takes place at that moment.
Under the Bill as at present drafted, in the case of in vitro fertilisation, because conception takes place at that moment, if the fertilised ova are implanted after the mother or the father knows that the marriage is invalid the child will still be legitimate. What should matter is not the time—My Lords, I cannot talk against you. I cannot do it; I am tired.
A noble Lord: So are we all.
Lord Kilbracken: I appreciate that. I shall leave it at that, as I believe I have made my point. I beg to move.
7 p.m.
The Lord Chancellor: My Lords, I made it clear at an earlier stage of this debate that there is a point behind this amendment. It is a worthy point. If the noble Lord will withdraw his amendment, I shall undertake to table appropriate amendments to cover this matter at Third Reading. The objective of this amendment, as I understand it, is to ensure that a child born as a result of fertilisation in vitro is within the ambit of Section 1 of the Legitimacy Act 1976, which in certain circumstances legitimates the children of void marriages.
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It is the Government's intention that such a child should be brought within the scope of the provision. When I moved Amendment No. 3 I had precisely that objective in mind. However, I am grateful to the noble Lord for having moved this amendment because it has revealed that Clause 28 needs amending in the light of a previous amendment. This drew a distinction between insemination and conception, thereby making it clear that the latter could refer to creation only outside the mother's body, whether in vitro or by means of another technique. If the noble Lord will agree to withdraw, I shall undertake to table appropriate amendments at Third Reading.
Lord Kilbracken: My Lords, I am most grateful to the noble and learned Lord, and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 2 [Minor and consequential amendments]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 24:
Page 49, line 44, at end insert—
("91. At the end of section 60(2)(c) of that Act (supplementary provisions as to declarations) there shall be added the words "and on persons who may be affected by any declaration applied for".").
The noble and learned Lord said: My Lords, in the debate in Committee my noble and learned friend Lord Simon of Glaisdale asked whether Clause 23, which refers to provisions as to blood tests, covered a person who is cited to see the proceedings. That occurs, for those who are interested, in col. 1281 of Hansard.
The question prompted me to consider whether there should not be a rule-making power. This amendment is the result of it. It amends Section 60(2) of the Family Law Act 1986 to provide for rules to be made enabling the court to order that certain persons be given notice of application for declarations as to parentage, legitimacy and legitimation. These persons would not become parties to the proceedings unless they wished to do so. They would, however, be given an opportunity to become parties if they wished to do so.
The power created by this amendment is analogous to that contained in Section 47 of the Administration of Justice Act 1985, which revived the old and useful concept of citation to see proceedings. It is limited to probate and trust cases. However, a number of proceedings for declaration will in substance relate to a future right of inheritance. In some cases, it may be proposed that a blood test be carried out on a person, such as a testator, so that an issue of parentage may be resolved before his death. In such cases, it is right that persons who may have an interest in the proceedings, such as other potential beneficiaries, should have an opportunity to become involved parties. This amendment confers that opportunity upon them. I beg to move.
Lord Simon of Glaisdale: My Lords, all that falls for me to say is to thank my noble and learned friend. He has dealt with this matter entirely appropriately, if I may say so with respect. I am glad to have been the occasion, but I cannot claim any credit for the amendment, which I heartily support.
On Question, amendment agreed to.
Social Security Benefits Up-rating (No. 2)Order 1986
Social Security (Contributions, Re-rating)(No. 2) Order 1986
Social Security (Treasury Supplement to and Allocation of Contributions) (Re-rating)Order 1986
Statutory Sick Pay (Rate of Payment) Regulations 1986
Family Income Supplements (Computation) (No. 2) Regulations 1986
Supplementary Benefit Up-rating (No. 2) Regulations 1986
7.7 p. m.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Baroness Trumpington): My Lords, I beg to move that the draft orders in the six social security motions standing on the Order Paper in the name of my noble friend Lord Hesketh be approved.
These statutory instruments put into effect the third up-rating of social security benefits within 16 months. They complete our transition from a November to an April up-rating timetable, by way of the interim increase which was implemented last July. The instruments also propose changes in the statutory sick pay scheme; in national insurance contribution brackets; and in the level of the Treasury supplement to the National Insurance Fund for the forthcoming tax year. It will be the first time since the debates on what became the National Insurance Act 1974 that the House has had the opportunity to discuss together both the increase in benefits and the changes in national insurance contributions which fund over half the total cost of the increase—nearly £500 million out of some £720 million in 1987–88.
It seems extraordinary that Parliament has so rarely been able to discuss social security finance and expenditure together. Our changes in the up-rating timetable, which these instruments conclude, mean that in future it will always be possible to consider these issues at the same time. I feel sure that the House will welcome this sensible development.
The details of the social security benefits up-rating were announced by my right honourable friend the Secretary of State for Social Services in another place on 22nd October, and were repeated in your Lordships' House. It will be for your Lordships' convenience if I briefly run over the details. The up-rating of all benefits is based on this occasion on the movement of the relevant price index between January and September 1986. Over this period, the retail price index showed an increase of 2·1 per cent., and this is accordingly the increase in retirement pensions, widows' and invalidity benefits and the other weekly national insurance benefits.
Retirement pensions will go up by 80 pence a week for a single person, from £38·70 to £39·50, and by
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£1·30 for a couple, from £61·95 to £63·25. Child benefit will also increase in line with inflation, from £7·10 to £7·25, and the non-contributory benefits such as mobility allowance, attendance allowance, severe disablement allowance all increase by 2·1 per cent. War pensions and war widows' pensions go up similarly.
Since 1982, the normal index for the uprating of supplementary benefit has been the retail price index minus housing costs. Over the eight-month period measured for this up-rating, the change in this index was 2 per cent., and the corresponding increase in supplementary benefit is thus less than for the contributory benefits. Supplementary benefit additional requirements are up-rated by the appropriate specialised part of the retail price index and have been increased where the relevant index warranted it.
I have already said that this up-rating is the third in 16 months as we move to a new up-rating timetable. It thus covers price rises only over an eight-month period. An eight-month increase is inevitably less than one which covers a full 12 months, and the increase is obviously smaller when annual inflation is at its current low level. It perhaps puts next April's rise into context if I point out that the increase of £1·30 means that between November 1985 and April 1987 the basic pension of a couple will have gone up by a total of £5·95 and a single pension by £3·70. That amounts to some 10·3 per cent. extra over the whole 16-month transitional period. When we last had a debate on social security up-rating in July 1986 the noble Baroness, Lady Jeger, expressed doubts about whether the retail price index adequately measured the price increases affecting elderly people. I hope that she will acknowledge that a total increase of over 10 per cent. in 16 months is not bad.
Although the April up-rating of benefits is unusual in being only eight months after the last one, there is very little that is remarkable about the detail of the increases before the House. We have adhered to our pledge to maintain the purchasing power of pensions and other linked long-term benefits, and this at a time when we are paying pensions to almost 1 million new pensioners since 1978. I hope also that now that we have the figures for the April up-rating, your Lordships will be happier about the effect of moving up-ratings from November to April.
The change of up-rating date means that beneficiaries will have extra money at the same time as other major financial changes take place, such as in taxes, rates, local authority rents and, of course, national insurance contributions. It means that pensioners will no longer receive a tiresome change of tax coding in the middle of the year, as was the case with November benefit increases. Now that the benefit rates are clear, we know that inApril a single pensioner will get a basic pension of £39.50, 15 pence a week higher than if his benefit had been increased by the RPI on the old November timetable. I hope that this will relieve the concern expressed by the noble Lord, Lord Banks, on the last occasion an up-rating was debated here.
I turn now to the Statutory Sick Pay (Rates and Payment) Regulations. As your Lordships will be aware, there are at present three rates of statutory sick pay, depending on an employee's average weekly

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earnings. However, as many as 85 per cent. of all SSP payments—that is, 4.8 million—attract SSP at the top rate. This leaves only 15 per cent. of payments where the middle or the lower rate is applicable. It is clearly not a sensible structure to retain two rates for such a small percentage. It overcomplicates the scheme and increases the administrative task for employers. The regulations accordingly merge the middle and lower rates with effect from 6th April, producing a simple two-band system. This logically reflects the current situation, while at the same time providing a welcome easement on the operation of SSP for employers.
The regulations provide that the standard rate of SSP will increase to £47.20 and will be payable to all employees whose average earnings are £76.50 a week or more. The lower rate will be set at £32.85 and will go to employees whose average earnings fall between £39.00—the new lower earnings level for the payment of national insurance contributions—and £76.49.
After that canter through the increases in social security benefits, I now turn to the second main element in these instruments—the means by which national insurance benefits such as pensions, unemployment benefit, invalidity benefit and others are actually financed. Noble Lords will recall that my right honourable friend the Secretary of State announced the Government's proposals for national insurance contributions in another place on 6th November. I hope that your Lordships will particularly acknowledge the Government's achievement in keeping the employee's Class 1 contribution rate unchanged for the fourth successive year. As required by statute, the lower earnings limit for Class 1 contributions will be £39 per week from next April, because it is linked to the weekly rate of basic retirement pension rounded down to the nearest pound. The upper earnings limit, which may be between 6½ and 7½, times the basic retirement pension, will be £295 per week from next April, nearly 7· times the basic pension level.
The regulations dealing with the upper and lower earnings limit for Class 1 contributions cannot be laid before the House until the draft benefits up-rating order has been approved, because of the statutory link with pension levels. However, I mention them now because they are an integral part of the Government's proposals on contributions.
I should like to look first at some of the detailed proposals in the draft Social Security (Contributions Re-rating) (No. 2) Order 1986. Noble Lords will recall that the Government reduced the Class 1 contribution rates paid by lower paid workers and their employers in 1985 but did not affect their benefit entitlement. The net annual cost of these changes, reflected in lower receipts from national insurance contributions, is expected to be £500 million in the current year, which is the first full year of operation.
The Government propose to maintain the value of the earnings brackets at which lower contribution rates are paid by increasing their respective earnings limits. The lowest earnings bracket on which contributions will be payable at the 5 per cent. rate will run from £39 to £64.99 per week. The 7 per cent. earnings bracket will run from £65 to £99.99 per week, and the 9 per
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cent. earnings bracket will start from £100 per week and end at £149.99 for employers' contributions and at £295 per week, the proposed upper earnings limit, for employees' contributions. Employers will pay contributions at the 10.45 per cent. rate where a person's weekly earnings are at or above £150. The proposed increases in the earnings brackets are greater than strict inflation indexing would have required.
These proposals for the Class 1 contribution are of greatest interest to most workers, but a growing number of people are now self-employed. The Government as a whole attach great importance to the self-employed and to their contribution to the economy. We took steps to assist them in 1985 by abating the level of the flat-rate Class 2 contribution they pay. We are continuing that abatement in 1987, and the Class 2 rate will therefore rise by only 10p to £3.85 a week. Self-employed people also pay profits-related Class 4 contributions if they have profits above a certain level. The Class 4 contribution rate itself will remain unchanged at 6.3 per cent. The profits limits will go up from £4,450 to £4,590 and from £14,820 to £15,340. The upper limit is exactly 52 times the proposed Class 1 upper earnings limit.
The changes mean that Class 2 contributors will pay only an extra £5.20 per year in 1987–88. That is a very modest rise. For those self-employed people with profits at or above the proposed upper profits limit of £15,340, annual Class 4 contributions will increase by £23.94 a year in 1987–88.
The remaining category of national insurance contributions is the voluntary Class 3 rate, which noble Lords will be aware protects the long-term benefit rights of those people with breaks in their contribution records who are not otherwise protected by credits of various kinds. The rate is being set at the customary 10p per week less than the weekly Class 2 rate, and the voluntary Class 3 rate will therefore be £3.75 per week from next April.
I mentioned earlier that national insurance contributions pay for only a proportion of all social security benefits. Almost half of all expenditure on social security benefits is expected to be met by general taxation in 1987–88. This changing balance between the cost of contributory benefits, such as pensions, and the cost of non-contributory benefits, such as child benefit, or income related benefits, such as supplementary benefit, leads to our proposals for changes in the Treasury supplement to the National Insurance Fund.
The Treasury supplement dates back to the start of the national insurance system, when a direct subsidy from general taxation to the cost of contributory national insurance benefits was thought appropriate. However, over the years the number and cost of benefits financed directly from taxation has grown. Even between 1981–82 and the current year the share of total social security expenditure financed wholly from tax revenue has gone up from 40 per cent. to 46 per cent. The Government have in these circumstances to strike a balance between revenue from contributions and from taxation.
We decided that the taxpayer should pay less to the National Insurance Fund in recognition of the growth of expenditure on non-contributory benefits which has

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been met wholly by the taxpayer. Our proposal is therefore to reduce the level of the Treasury supplement to the National Insurance Fund by 2 per cent., from 9 per cent. to 7 per cent. from April 1987. This does not mean that any contributor has to pay higher contributions. This is because of our proposals for changes in the small share of contributions going to the redundancy fund and from employers only to the maternity pay fund.
Since August 1986 the redundancy rebate has ceased to be paid from the redundancy fund to employers with more than nine employees. As a result, there are now lower demands on the redundancy fund, which has recently moved into surplus after a long period of deficit. The Social Security Act 1986 provides for the winding up of the maternity pay fund as a result of the introduction of statutory maternity pay, and for the transfer of its assets and liabilities to the National Insurance Fund. We therefore propose to abolish the allocation of employers' contributions to the maternity pay fund from next April and to cut substantially the allocation that is paid to the redundancy fund. The employment protection allocation, as it is called, will thus reduce to 0·07 per cent. for employees and to 0·06 per cent. for employers from next April.
I now come to the report by the Government Actuary on the financial effects of the Government's proposals. In 1987–88, the National Insurance Fund is expected to receive income of some £26·3 billion; this includes contributions, the Treasury supplement, and other income including income from investments. Total outgo from the National Insurance Fund is expected to be £25·6 billion in 1987–88, including the additional costs of the proposed benefit uprating and expenditure on administration. On current estimates, the fund is expected to be in surplus by some £742 million in 1987–88, and the expected balance in the fund is expected to rise by the same amount to £6.4 billion by April 1988.
I must stress that these estimates are uncertain. At this stage, about three months before the start of the financial year and some 15 months before its end, it is clearly difficult for anyone to be certain that the fund's income and outgo and its surplus will turn out as the actuary presently estimates. Uncertainty is one reason for the fund to keep a balance as a working reserve against any unexpected increases in benefit expenditure or falls in contribution income. An operating margin is also required to fund the payment of benefits by the Post Office on time. We expect that the accumulated balance in the fund will be equivalent to nearly 13½ weeks' benefit expenditure. We regard the size of this balance as sensible.
To sum up, we ale proposing to increase social security benefits by 2.1 per cent. from April 1987, giving pensioners and others the third increase in 16 months. We are increasing supplementary benefit scale rates by 2 per cent., which is the amount of increase in the retail price index less housing costs—the relevant index for this purpose. Supplementary benefit additional requirements are being increased by the movement in the appropriate specialised index, where it has gone up over the relevant period. Statutory sick pay is being simplified
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from three payments rates to two. And this is being achieved so far as benefits financed from the National Insurance Fund are concerned while we hold employees' contribution rates steady for the fourth successive year and redress some of the balance between the contributor and the taxpayer in meeting the cost of benefits.
Social security expenditure will cost some £46 billion in 1987–88, accounting for over 30 per cent. of public expenditure. The up-rating we propose will in itself add over £700 million to the current bill, on top of the £420 million provided for in July. This is a good record on both benefits and contributions. I commend the proposals to your Lordships.
Moved, That the Social Security Benefits Up-rating (No. 2) Order 1986 laid before the House on 2nd December [3rd Report from the Joint Committee]; the Social Security (Contributions, Re-rating) (No. 2) Order 1986 laid before the House on 25th November [3rd Report from the Joint Committee]; the Social Security (Treasury Supplement to and Allocation of Contributions) (Re-rating) Order 1986 laid before the House on 25th November [3rd Report from the Joint Committee]; the Statutory Sick Pay (Rate of Payment) Regulations 1986 laid before the House on 2nd December [3rd Report from the Joint Committee]; the Family Income Supplements (Computation) (No. 2) Regulations 1986 laid before the House on 25th November [3rd Report from the Joint Committee]; and the Supplementary Benefit Up-rating (No. 2) Regulations 1986 laid before the House on 2nd December [4th Report from the Joint Committee] be approved.—(Baroness Trumpington.)
7.30 p.m.
Baroness Jeger: My Lords, I begin by saying that on the Order Paper the noble Lord, Lord Hesketh, was to propose these draft orders tonight. The fact that he is poorly at home and that we have the pleasure of having the noble Baroness here to deal with these proposals shows that women are much stronger than men. This is a difficult debate because all these measures were passed in the other place before the end of the year and we are now asked to rubber stamp them. We shall not vote against them but we should like to deal with one or two aspects. All the instruments for the up-rating of benefits within the existing system are quite unacceptable because they lack the fundamental changes for which we, on this side of the House, are working. Because the base is wrong, the up-rating cannot be right; but we have to try to deal with some of these questions.
We agree that the April up-rating is acceptable. We welcome the introduction of closer changes in benefit and changes in contribution and we look forward to bringing those changes closer to income tax changes. The total cost of the consolidated fund and the national insurance fund which reached 30 per cent. of public expenditure involves us in considerable thought. When we look at the higher cost of fuel, which is part of the up-rating, we have to wonder from which date the fuel costs are calculated. Most benefits are to be increased by 2·1 per cent. This is based on price increases between January and September. But average earnings during that period have increased by more than 7 per cent. The Labour Party believes that

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increases in benefits should be related not to increases in prices but to increased in earnings. We must ensure that benefits are related to increases in living standards.
Supplementary benefit is to be increased by about 2 per cent., but that figure excludes housing. There are many changes to housing benefits and these will mean a reduction of £28 million in a full year. The maternity pay fund is being wound down and this will save the Government £335 million. With regard to social security pay, will the abolition of the middle rate mean that 400,000 lower paid people will be worse off? I am told that £19 million will be saved. These points have to be considered along with the changes being made.
What would the increases be if they had been linked to earnings rather than prices, as happened under the previous Government? I am told that in 1978 a couple with two young children on supplementary benefit would receive about 46 per cent. of an average wage. This is now down to 43 per cent. If I am wrong, I should like to be told.
The Government Actuary's report shows that a 1 per cent. increase in earnings produces an extra £220 million a year for the fund. We are now told in these figures that there is to be a reduction in the Treasury contribution of 7 per cent. This cannot be right. If we reduce the contribution to the fund, income tax payers will get some reduction and insurance contributors will have to pay more. The child benefit increase in these figures is 15p but it ought to be 50p to make up for the 1985 cuts.
Perhaps I may, with some hesitation, talk about supplementary benefit and heating additions. How much are the increases about which the Government have boasted due to higher costs rather than warmer hearts? Are heating allowances based on fuel prices between May 1985 and January 1986, as I have been told? These figures will continue until April 1988. Our heating allowances are not being kept in line with present prices but with the old prices.
I want to ask the noble Baroness about the present £5 allowance. I hope she will not mind, and I have already mentioned the matter to her. I am glad that the Government have taken this initiative to try to get ahead with the £5 allowances without a great deal of bureaucracy. I am a little worried about the advertisement tonight in the London Evening Standard which I believe is to be reproduced all over the country. The advertisement asks several questions. It asks:
"Are you or is your partner a householder?"
What is a householder? Is someone living in a bedsitter using a meter for the gas fire a householder? What is a lodger? What is the position? We know that many of the poorest and coldest people in the country are lodgers, using gas meters or electricity meters. It would be of great help—I ask this question because I know that the noble Baroness will want to be helpful—to let people know whether or not they are householders and what is their position within these rules.
The advertisement asks:
"Are you or is your partner 65 or over?"
Does that mean that if a woman is 60 she does not qualify. Do both people have to be over 65? I ask these
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questions not with any enmity but in order to make the position clear. Are the heating allowances based on fuel prices which do not now apply?
As regards retirement pensions, I am concerned in many respects, but I raise only one query. I had to read through the report by the Government Actuary on the drafts of the Social Security Benefits Up-rating (No. 2) Order that we are discussing. In paragraph 14, he said that almost the whole of the remaining increase in the surplus is accounted for by a reduction of £101 million in the anticipated expenditure attributed to retirement pensions. I have heard a great deal about what the Government are doing in respect of increases in looking after people. However, when I read in this very estimable document that there is going to be a £101 million decrease in retirement pensions, then I feel that it is quite fair to ask the Minister about it.
At paragraph 15, the Government Actuary refers to the money that would be gained by the abolition of the death grant. I find that the maternity pay fund will cease to exist. In paragraph 18, the Actuary says that liabilities will become part of the National Insurance Fund and that there will be a saving of £35 million.
If these savings to the Government are made, it can only be because they are taking money from recipients. I think it is very important, without going into too much actuarial detail, that the Minister should tell us exactly why these deductions are being made. Taking away £35 million from the maternity pay fund and all the other amounts that I have mentioned must surely make us aware that the Government are not concerned with making things better for the poorest people in this country but are making them worse.
7.45 p.m.
Lord Banks: My Lords, I should like to thank the noble Baroness. Lady Trumpington, for her explanation of the content of these orders. I have made clear on previous occasions that we on these Benches approved the change to April as the up-rating month and I am glad that we have now come to the end of the series of special up-ratings which were necessary to bring that about.
At first sight this would appear to be a fairly routine up-rating to take account of a 2·1 per cent. inflationary increase. The noble Baroness said that it would cost £700 million extra per year. Said like that, it seems to be a large sum, but we see it in perspective when we realise that, as she made clear, the total cost of social security is expected to be in the region of £46 billion. What is now being spent, or will be spent, as a result of this up-rating is not increasing the real value of benefits but preserving the real value of benefits.
National insurance benefits account for 54 per cent. of social security spending and they are of course largely financed by earnings-related contributions. Earnings are increasing faster than prices. Contributions are based on earnings. Benefits are linked to prices. Therefore we should expect a buoyant review and the money should be there to meet the up-rated benefits, certainly so far as concerns national insurance benefits. Therefore we see that the spending of the £700 million, welcome as it is, is not really an act of government largesse.

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While, as I say, this is a fairly routine up-rating, as the noble Baroness, Lady Jeger, pointed out, there arc slipped in a number of minor but significant reductions in benefit. We know that £68 million is to be cut from housing benefit, though we are not directly concerned with that this evening. The noble Baroness, Lady Jeger, referred to the fact that there will be a saving of £19 million as a result of the merging of the two lower rates of statutory sick pay; and there will be losers as a result of that.
I am aware that there will be protection for those who are actually on benefit at the time when the change takes place. Nevertheless, future claimants will be at a disadvantage as compared with current claimants. I understand that the number likely to be involved is in the region of 400,000. Perhaps the Minister can confirm that that is the estimated figure.
The noble Baroness, Lady Trumpington, referred to the further reduction in the Treasury supplement to the National Insurance Fund from 9 per cent. to 7 per cent. That represents a reduction in the National Insurance Fund's income of £581 million, as the Government Actuary's report makes clear. But we have to bear in mind that the Treasury supplement has been reduced since 1979 from 18 per cent. to 7 per cent. If it had been maintained at 18 per cent. then during the year 1987–88 the Treasury supplement would have amounted to £5,225 million instead of the projected £2.032 million at the 7 per cent. figure, again according to the Government Actuary's report.
Therefore as a result of that cut in the Treasury supplement there has been a reduction from that source in the revenue of the fund by £3,193 million per annum. That is 12½ per cent. of the cost of the benefits which are projected for the year 1987–88. A 12½ per cent. cut in national insurance contributions, for example, would mean that the contribution for a contracted-in person of 19.45 per cent. for an employer and employee combined could have been reduced to 17.02—a reduction of nearly 2½ per cent.
We must also remember that employees' contributions have risen from 6½ per cent. to 9 per cent. since this Government took office. While we congratulate the noble Baroness on the four years of no increase to which we referred, some of the gilt is taken off the gingerbread when we recall the 2½ per cent. increase in earlier years. Had the Treasury supplement not been reduced from the level at which it stood in 1979, that 2½ per cent. addition need not have been paid by contributors as it is at the moment—except for the mitigation provided for those at the very bottom of the scale—or the £3,193 million per annum could have been spent in providing better national insurance benefits; for example, higher pensions.
The fact that it was not spent on increased benefits or on national insurance contribution reductions but diverted to pay for non-contributory benefits, as the noble Baroness explained, is surely a way of making contributors pay for non-contributory benefits. That cannot be right.
I am glad that child benefit is increased in line with prices, but the 1985 cut in real value has not been restored. I ask again, because I do not think we have had a direct answer on this point, whether it is the intention of the Government to restore that particular
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cut at some time in the future. The noble Baroness, Lady Trumpington, will be aware that we on these benches are very concerned that the Government will not undertake to maintain the real value of child benefit in the future.
Finally, in 1979 the Government said that pensioners and other long-term beneficiaries could look forward to sharing the increased standards of living in the country as a whole. It is true that there has been some increase in the real value of the pension since 1979, but it is not clear just how much of that is due to the link with earnings which operated when the Government came to power but which they subsequently broke. The pension has fallen as a percentage of national average earnings, and with earnings rising faster than prices and this trend assumed by the Government to be going to continue, pensioners are falling behind and will fall still further behind.
I therefore ask the question: when will they share as promised in the increased standards of living? When I put a similar question in this House on the 22nd October last to the noble Baroness, she said in reply:
"It would not he responsible to move to a system which would result in substantial increases in real terms in future years irrespective of the country's ability to pay for them". [Official Report, 22/10/86; col. 308.1
That is what the noble Baroness said. Perhaps I may put this question to her: is that not the exact principle on which the Government's policy with regard to SERPS is based? If it is all right in one case, why is it not all right in the other?
While talking about the basic retirement pension, it is relevant to refer, as did the noble Baroness, Lady Jeger, to the discussion about extra payments for heating during exceptionally cold weather such as we are experiencing at the moment. The problem is that the benefit is too difficult to trigger and too selective. To have a retrospective benefit defeats its object, however short the triggering period. The only way to avoid a retrospective benefit is to increase the regular benefits either during the depths of winter only or throughout the year. Of course that would involve a redistribution of income, which regrettably the Government do not seem prepared to consider.
A large part of the money required could be found by replacing allowances against income for tax purposes with allowances against tax. These allowances would be worth the same to those on higher rates of tax as those on the standard rate. Thus, an allowance of £1,000 against income would be replaced by an allowance against tax (that is, a deduction from tax) of £290, the same as the value of an allowance of £1,000 against income to a standard rate taxpayer. But this figure of £290 would apply at all higher rates of tax. This is one method of redistribution which the Government could use.
From what I said earlier the House will appreciate that, while we are not opposed to the general purpose of these orders, they have certain features about which we have the strongest reservations.
Baroness Turner of Camden: My Lords, I do not want to add very much to what has been said by my noble friend Lady Jeger and the noble Lord, Lord

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Banks, who has just made a contribution to the debate, but I should like to make a few comments about the statutory sick pay provisions.
I can remember being a member of a TUC committee when SSP was first introduced, and the committee was very apprehensive about it at that time. Eventually we were told by the then Minister that we should watch to see how it worked and last year we were told that there were no problems with it. Indeed, this statement was repeated by the Minister in another place when these regulations were discussed. This afternoon we have been told that, because of administrative complications, the levels are to be cut to two instead of three. I must say that the effect of this step on the lower paid could very well be quite disastrous.
As has already been pointed out, £19 million is to be saved in this way. That seems to me to be a very mean kind of saving, because substantial savings are being made by the Government in other areas. A sum of £35 million is being saved as a result of the maternity pay fund: the noble Baroness herself made reference to savings that would be made on the redundancy fund as a result of the passage last year of the Wages Act, and there are other savings that have been mentioned by both my noble friend Lady Jeger and the noble Lord, Lord Banks.
This is all very well for those employees—I happen to be one, and there are numbers of other better paid employees in this category—who are covered by collective agreements, where their employers undertake to pay full pay for the first six months of sickness and half pay thereafter. There are a number of agreements of that kind which in the main cover higher paid workers. The SSP is not for such workers. Here we are talking about the very poorest of low paid workers. I should like to question why it is thought necessary to introduce this two-level arrangement. As has already been pointed out, it will have an effect on future workers and it seems to me that the amount of saving is really quite niggling. In the context of these figures, £19 million is a very small amount indeed.
I should like to suggest that this proposal should be reconsidered. It seems very mean indeed to say to people at the lowest end of the earnings chain that so far as they are concerned their sick pay can be reduced in this way. That is what is meant. That £19 million has to come from somewhere and it will come from those people.
Lord Kilmarnock: My Lords, I shall intervene only very briefly in this debate. With his usual expertise the noble Lord, Lord Banks, has covered almost all the points about which I should have spoken if he had not been here. I agree with him that it is good that we have moved into the last stage of shifting the up-ratings from November to April. I think that it has been a very confusing process for the public and that they will be relieved that the shift has now entered its final phase. They will at least be in a better position to evaluate the real value of benefits and to judge whether they are being treated fairly.
I want to make only one specific point. In the debate on AIDS which was held in your Lordships' House
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and which 1 introduced on the 10th December last year, I asked the noble Baroness about the social security arrangements for AIDS victims. The point that I was making then was that there was no special benefit for AIDS victims, who, like those with terminal cancer, notice the cold more and require special diets. Moreover, the continual doses of antibiotics which they require devitaminise the body and often require additional expenditure of up to £10 a week on vitamin supplements and medicaments of that nature. Also, because of the heavy sweats with which such patients are afflicted, frequent changes of bed linen and clothing are required, which lead to much higher laundry bills.
I said in that debate that a single person's sickness benefit of £29 a week, even when brought up to £30 or so by heating and laundry allowances, was a very inadequate sum with which to get by in those appalling circumstances. Of course in these orders we find that the sickness benefit rate for a single person has been uprated to £35·5, as the noble Baroness explained, but the basic problem to which I drew attention then remains.
I now want to ask the noble Baroness whether she is aware—and I expect she is—that the length of spells in hospital undergone by AIDS patients is reducing somewhat, which I suppose is owing to increasing experience in the treatment of opportunistic diseases arising from AIDS. This situation is to be welcomed, but it is unlikely to continue if AIDS patients in the community do not have the means to maintain themselves in a reasonable state of health.
With the projected increase in numbers on a very large scale—whether a pessimistic or even an optimistic scenario is adopted, the increase will be on a very large scale—it will surely be desirable both on grounds of humanity and of cost to enable AIDS victims to spend as much time as possible out of hospital. I therefore simply want to ask the noble Baroness whether she will reconsider her earlier reply. I should perhaps have said that in the earlier debate she gave me rather a dusty answer.
I want to ask the noble Baroness whether she will reconsider her earlier reply. I am not seeking to press her to make any commitment this evening other than to bring the matter to the attention of her colleagues in her department, to discuss it with them and possibly to write to me when she has had the opportunity of comparing notes with them. That is the only request I make of her this evening.
8 p.m.
Baroness Trumpington: My Lords, although the debate has been short, the subject is of enormous interest to everyone in the country as actual or potential beneficiaries or as contributors to national insurance. I am not sure whether your Lordships have appreciated being able to consider both sides of the benefit balance sheet together but I hope that you may do. It is a sensible procedure and reduces the burden on the House by making one debate out of two. By the time we next debate these annual instruments we shall be faced with fewer Motions. When the up-rating legislation contained in the Social Security Act 1986 comes fully into force it will incorporate all benefit up-ratings in one order.

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I shall try to answer as many of your Lordships' points as I can, and will of course write to noble Lords should I fail to pick up any matters. I noted what the noble Baroness, Lady Jeger, said about possible difficulties in understanding the advertising about the exceptionally severe weather payments. I will pass her remarks to my right honourable friend, but I feel sure that the publicity about that issue will encourage the majority of those entitled to claim for payment. On the point about age, the payment is available where either one of the couple is aged 65.
The noble Baroness asked in the same context what a householder is. A householder for supplementary benefit purposes is essentially someone who has responsibility for his or her own housing expenses and care of domestic tasks. It is a common-sense definition. It is a matter for the independent adjudication authorities to decide in any individual case whether someone is a householder. An old person living in a bed-sitter, paying rent and catering for him or herself would be a householder. Someone living in a granny flat in the house of a son or daughter probably would not be.
The noble Baroness referred to the Treasury supplement being cut to provide scope for income tax cuts. That is not true. We are merely trying to balance the interests of the taxpayer, who pays for noncontributory benefits, and the interests of the contributor. My right honourable friend the Chancellor of the Exchequer will decide what scope he has for adjusting the burden of taxation after considering many pieces of information more important than the expected annual surplus on the National Insurance Fund.
The dates of fuel cost calculations were also brought up by the noble Baroness, who asked what the basis of the increase in fuel costs was. All the benefits covered by the uprating were increased by the relevant index from January to September 1986. During that period the fuel section of the retail prices index fell by 0.1 per cent. That is why the supplementary benefit heating additions are not being increased on this occasion. The higher rate heating addition paid to very elderly people went up in July to £5.55 a week.
The noble Baroness also referred to the winding up of the maternity pay fund and the savings that will accrue from that. As I said, the fund is being wound up because of the introduction of statutory maternity pay from next April. As your Lordships will be aware, statutory maternity pay will be paid by the employer and he will be able to recover all those payments from the national insurance contributions he pays to the Inland Revenue. That will lead to reduced income for the National Insurance Fund. It is therefore wrong to suggest that the winding up of the maternity pay fund will result in a saving.
The maternity allowance did not meet its objectives. The new rules will ensure that it goes to women who have given up work to have a child, and 20,000 women with recent work records will be brought into benefit for the first time by the revised scheme.
The noble Baroness made some comparisons with what benefit levels might have been had they been increased consistently in line with earnings. I accept
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that benefit levels would have been higher if they had been linked with earnings, but that measure is not one that the Government can accept in current economic circumstances.
The noble Lord, Lord Banks, will note with interest that if we look more generally at pensioners' incomes we find that over the period 1979–1985 their net incomes rose in real terms by 2·7 per cent. a year, whereas the incomes of the population as a whole rose by 1·3 per cent. only.
We must take account of the changing balance of social security expenditure between contributory and non-contributory benefits. Over the past decade the growing level of non-contributory benefits has meant that the burden of social security expenditure would have fallen on the taxpayer had we not cut the Treasury supplement. We think that the cut in the Treasury supplement is only fair and reflects the changing balance of social security expenditure.
With regard to the question asked by the noble Lord, Lord Banks, about child benefit, his interest in child benefit is well known. I cannot give him the assurance that he seeks about the restoration of the 1985 value. The up-rating of child benefit is something which must be considered on each up-rating occasion in the light of all the circumstances.
The noble Lord referred to real increases in pensions. The real value of retirement pensions has increased by several percentage points ahead of inflation since 1978. We expect that increase to be maintained. I dealt with the earnings link in reply to the noble Baroness, Lady Jeger. I believe that the point I made about the increase in pensioners' total net incomes over the period 1979 to 1985 is an adequate answer to the noble Lord's concern about the pensioners' share in rising living standards. As I said, they have done better than other members of the general public.
The noble Baronesses, Lady Jeger and Lady Turner, asked me some questions about statutory sick pay and the effect of the reductions in rates from three to two for employees. About 7 per cent., or 400,000 spells, of SSP a year are currently paid at the middle rate, which will be abolished under these regulations. I should make it clear that it by no means follows that those employees will find their income reduced during sickness, although I acknowledge that there will be a public expenditure saving of £19 million.
In the first place of course we are providing that all employees on the middle rate at the changeover date will continue to receive that rate while their current spell of incapacity lasts or until their SSP entitlement runs out, if that comes sooner. No one will receive a cut in the SSP that they are already receiving at 6th April.
On top of this, account must be taken of employers' own occupational sick pay schemes. We know that as long ago as 1977 some 80 per cent. of all full-time employees were covered by such schemes, and there is evidence to show that since the introduction of SSP occupational sick pay coverage has continued to grow. Many employers top up the SSP they pay under their own schemes. Thus the overall income of the

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employee during sickness will not reduce. I acknowledge that some employees will not have the benefit of occupational sick pay arrangements, but we need to view this in perspective.
In 90 per cent. of cases spells of sickness are over within eight weeks. Indeed, over half the spells are over within two weeks, with the average duration working out at three weeks. Most employees will not therefore be significantly affected by the merger of the middle and lower rates, but where appropriate supplementary benefit will of course be available.
The noble Lord, Lord Kilmarnock, raised the point about social security and AIDS. There is no special and separate social security for AIDS sufferers, but the supplementary benefit system provides a range of special assistance for disabled people, which includes, for example, provision for meeting the full cost of special diets where they are very expensive. Under the reformed income support scheme from 1988 a variety of help will also be available for disabled people including AIDS sufferers. But for all that, I shall bring the remarks of the noble Lord to the attention of my right honourable friend.
In my opening remarks I summed up the main proposals in these instruments. I remind your Lordships again that the Government's proposals increase benefit expenditure by £720 million in 1987–88, on top of some £420 million arising from the up-rating which took place only last July. Our proposals for contributions protect the lower paid, mean no increase in Class 1 contribution rates (which are the concern of most employees) and provide for a fairer balance beween the taxpayer and the contributor in paying for national insurance benefits. I commend the orders and regulations to your Lordships.
On Question, Motions agreed to.

Industrial Training Levy (Construction Board) Order 1987
8.15 p. m.
Lord Lucas of Chilworth Lord Lucas of Chilworth rose to move, That the draft order laid before the House on 8th December be approved. [4th Report from the Joint Committee.]
The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper.
This order requires parliamentary approval because one part of it—that covering labour-only subcontracting—involves a levy exceeding 1 per cent. of emolument. I do not think that noble Lords will need any reminding of the importance of the construction industry which last year accounted for about eight per cent. of gross domestic product. Protecting the skill base of the industry therefore is clearly vital. That is why it is essential that this order should be approved. Money is then available to the construction industry training board to enable it to encourage firms to train within the industry.
The levy proposals are structured in the same manner as those approved by both Houses last year and are expected to raise about £50 million.
The levy is made up of three parts. First, there will be an occupational levy on directly-employed
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construction workers in the main industry. A set amount will be raised for each occupation. This is of course subject to an overall limit of 1 per cent. of employers' wage hills. The rates vary according to the type of cratfsman trained and reflect the training costs of each craft. The rates are in the main the same as last year but increases are proposed in five occupational areas. These affect fewer than 10 per cent. of the total directly employed workforce in the main industry. The increases are judged necessary to enable the board in particular to increase its contribution to the YTS it operates on behalf of the industry.
Secondly, with continuing strong support from the industry, the board proposes to retain the 2 per cent. levy on payments made by firms in the main industry for work done by labour-only subcontractors. This rate has remained unchanged since 1981. It reflects the board's continued judgment that labour-only subcontractors in the main undertake an inadequate level of training, but rely on obtaining skilled manpower trained by other employers.
For the sectors covered by those two measures, companies with payrolls of £15,000 or less will not be required to pay levy, and this will exclude around 37 per cent. of all construction firms coming within the board's scope.
Thirdly, for the smaller brick manufacturing sector, the board proposes a rate of 0.05 per cent. of payroll. This is a reduction on last year's rate. All employers with emoluments of £10,000 per annum or less will not be required to pay levy. This is unchanged from last year.
These proposals have been unanimously approved by the board. Noble Lords will recall that the board comprises representatives of employers and employees through the trade unions—UCATT, TGWU. EETPU—and education. The proposals are supported by the employers' associations in the industry. Noble Lords will wish to know in particular that the proposals are supported by the Federation of Master Builders, which two years ago expressed some concern about the proposed method of calculating levy. At the same time, other employer organisations spoke equally strongly in favour of keeping the current system. As a result the board set up a working party—including the federation—to examine this concern and it has been agreed that the issue needs to be re-examined when the board can evaluate the financial implications of participating in the new two-year YTS. I am pleased that the industry has been able to come at least to an interim agreement on this matter, which we have always said is one essentially for the industry to resolve. I believe that the proposals therefore have the necessary level of consensus support required under the provisions of the 1982 Industrial Training Act.
Perhaps I should add that during the year the board has continued to work hard to develop training in the industry. It is pleasing to note that in April it signed a contract with the Manpower Services Commission for the new two-year YTS. The board currently has some 17,000 young people undergoing training in the scheme and this is making a central and important contribution to training in the industry. In addition, the board is piloting practical skill tests for trainees seeking to qualify as building craftsmen. This

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represents a major step toward the objective of obtaining a more coherent and relevant structure of vocational qualifications, alongside the provisions that were set out by the Government in the recent White Paper Working Together—Education and Training. The board will be playing a leading role in following up the White Paper's recommendations on vocational qualifications.
I commend the order to your Lordships. The proposals have been agreed by the board. I believe that they are necessary for it to continue its important work to extend and improve training in the construction industry and to play a significant part in the Government's training initiatives. I beg to move.
Moved, That the draft order laid before the House on 8th December be approved. [4th Report from the Joint Committee]—( Lord Lucas of Chilworth.)
Lord Dean of Beswick: My Lords, let me first express my appreciation to the noble Lord, Lord Lucas, for the clear explanations and the objective way in which he moved this industrial training order.
I believe that it is two years since I stood at this Dispatch Box when he moved the earlier orders. I am glad to see that, while there was no area of conflict between the larger building employer associations and the smaller ones, there is some optimism that the area of conflict as to how the levy is to be raised is in the process of being resolved. That is of benefit to everybody. My party supports training initiatives. They are essential. If the building trade industry picks up again it will be essential that adequate training of young people is made available in the crafts which are required. However, I think the Minister will understand that I wish to make one or two points.
This training board has quite a record of success. My view and the view of my party is that it seems a pity that the other training boards were done away with, against the advice of much broadly based political thinking, because we thought that they were also doing a good job. Although we accept the training schemes at present in being in other industries, we think that the retention of those which have been lost would still have been of benefit.
Yesterday during the debate the noble Lord, Lord Ezra, drew attention to the fact that there is a regional imbalance in the necessity for training building operatives. I know that in regions outside the South-East there is available a reservoir of skilled building labour workers who are at present unemployed. As I understand it, there is a shortage in the South-East of these skilled trades. The imbalance cannot be made up because there is no way that building trade workers in the North, in the numbers deemed necessary to make up the shortage, can move South because of the tremendous imbalance in the cost of housing, etc.
I should like to ask the Minister to give some indication that the training board will direct its attention to trying to deal with this regional imbalance, and correct the situation if possible. I know that is asking for an answer to a difficult question, but nevertheless I think the situation has to be corrected if we are to get out of the present troubles. My information is that there is a cash surplus of approximately £60 million at present available to the industry. This might
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have been better used in broadening the training schemes themselves or finding some way to use this not inconsiderable amount available for the purpose of resolving the regional problem about which I have spoken.
I accept in the broadest sense the introduction of the two-year training period, and it is a good thing. Nevertheless, there are people with the future interests of the building industry at heart who think that while it is a very good scheme, it falls a little short of producing the in-depth craftsmen required. I make the point on the basis that for a long time I, in both local and national government, have been interested in local authority building; houses, schools, etc. It is incumbent on the Government, or on the training boards through the Government's initiatives, to try, if they possibly can, at the first available time to increase the two-year training period to three years. Therefore, at the end of that three-year period we shall he getting a better finished product that could move straight into the labour market and produce highly finished goods. It is a fact of life in the building industry, as in most other artisan industries, that while the training schemes such as the ones we are now discussing are absolutely desirable and welcome, they are not a complete substitute for on-site training. I, and I know that other Members of your Lordships' House, learnt our trades by working alongside skilled men most of the time.
With those few general remarks, we welcome the spirit in which the Minister moved the order and the objective and frank way in which he explained it. So far as we are concerned, there are areas which need to be kept under review where we may improve things and prevent any slippage.
Baroness Seear: My Lords, I apologise to the Minister for not being in my seat when he began to speak on these measures. As the sole occupant of these Benches at this time I should like to welcome this order and say how glad we are that it is going through and that the building industry is putting this money into training. We particularly welcome the reference to the money being put into the two-year YTS. It cannot be said too often that the future of the trained manpower in this country depends on the success of the second year of YTS. The first year is a foundation year but it is in the second year that trainees will learn the techniques and specific skills required to begin to be effective in the building industry. Therefore, we greatly welcome the Government's commitment to the second year of YTS.
I am sure the Minister will agree with me on the following point, even though he may not see any way of dealing with the matter. All the evidence is that employers in this country are still far from being aware of the full requirements for a proper trained labour force. The adult training strategy put forward by the MSC is not getting the response that many of us hoped it would. The excuse put forward is that a great deal of the effort and money is going into YTS. But that is no alternative to putting resources also into adult training, especially when we have such a large number of people in our adult labour force who have never had any training. We all know now that with modern

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training methods older people can be trained if the resources are there.
There is abundant evidence, of which I know the Minister is well aware, that employers in other countries—our successful competitors—are putting a much higher proportion of their profits into the training of adult people. Until we do the same it does very, little good for us to congratulate ourselves on the development of YTS, important though that is, when our competitors are going ahead at a very much greater rate. It is not my work to be unduly critical, but employers in this country have simply not woken up to the importance for their own and our future survival of putting more of their money into training.
8.30 p.m.
Lord Lucas of Chilworth: My Lords, I am most grateful to the noble Lord, Lord Dean of Beswick, and to the noble Baroness, Lady Seear, for their contributions to our quite short debate tonight. I feel, as does the noble Baroness, that training is important, and it is sufficiently important for me to spend, if your Lordships will permit, a few minutes taking up some of the points which have been made.
I know that the noble Lord, Lord Dean of Beswick, does not expect me to rehearse the discussions which we had in 1982 when we wound up 16 of the training boards. Let us deal with matters as they are today. That takes me quite naturally to respond to the comments made by the noble Baroness. I could not find anything in what she had to say this evening with which I could disagree.
The Government have always felt that, with some exceptions, the responsibility for training rests with employers. It is certainly true that employers cannot rely entirely on the YTS, however good that is. There is undoubtedly—and we have proof in industry—a correlation between training, whether of young or older people, the acquisition of new skills and profit. It is from profit that wealth is created. We need the wealth to sustain those other parts of the economy that require money. I agree with, and am grateful to, the noble Baroness for underlining, as I do, the importance of employers recognising not only their general responsibility but their responsibility to their particular industries to train and sustain training.
It is interesting that in the construction industry, from a 1980–81 high of 21,874 apprentices, we dropped in 1984–85 to 14,000 only. In 1985–86 we now have some 16,000. I think this is very encouraging. About 13,000 of the young people on the Construction Industry Training Board's 1985–86 YTS have completed training and about 90 per cent. of those young people have been placed in employment.
The noble Lord, Lord Dean of Beswick, commented briefly on the reports of certain skill shortages. There
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is evidence that in some parts of the country some firms are finding it hard to recruit certain kinds of building craftsmen, in particular bricklayers and carpenters. My honourable friends the Minister for Housing and the Parliamentary Under-Secretary for Employment discussed this subject with senior figures from the industry on Tuesday. One of the apparent reasons for the shortages is that there is a spread of labour-only sub-contracting, and this has narrowed the general training base of the industry. However, the board has set up a working party to examine how training can be protected, given the prevalence of this labour-only sub-contracting. We hope that the working party will suggest practical ways in which this can be done. This includes the point that the noble Lord made regarding on-site training. All of us will look forward to seeing the outcome of that working party's deliberations.
The noble Lord mentioned the fact—I think this is quite important—that a considerable amount of surplus was shown in the training board's balance sheet. He mentioned £60 million. I do not have the report in front of me, but I do not quarrel with that.
Lord Dean of Beswick: My Lords, I may be slightly wrong, but it is something like that.
Lord Lucas of Chilworth: My Lords, in approving the board's proposals the Manpower Services Commission expressed concern at the level of the board's reserves. Indeed, the Government shared this concern. The board has given assurances that it will take steps to bring its income and expenditure more closely into line in future.
My honourable friend the Parliamentary Under-Secretary of State for Employment has been having discussions with the chairman of the Construction Industry Training Board expressly on the subject of how these reserves can be better used to provide the skills that many in the industry say they are having difficulties in recruiting.
Those are the points that have been raised—they certainly are important—and those are the answers. I am glad that noble Lords will agree to the order, which I commend to them.
On Question, Motion agreed to.

Pilotage Bill [H.L.]
Reported from the Public Bill Committee with amendments.
House adjourned at twenty-five minutes before nine o'clock.