Sitting of 7 December 1988

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

PRIVATE BUSINESS
NEWCASTLE UPON TYNE TOWN MOOR BILL [Lords]
Considered; to be read the Third time.
AVON LIGHT RAIL TRANSIT BILL [Lords]
Order for Second reading read.
To be read a Second time on Thursday 8 December.
CITY OF GLASGOW DISTRICT COUNCIL ORDER CONFIRMATION BILL
Considered; to be read the Third time.

BUSINESS OF THE HOUSE
Return ordered,
for Session 1987–88 of—

1

2

3

4

5

6

Date when Closure claimed and by whom

Question before House or Committee when claimed

Whether in House or Committee

Whether assent given to Motion or withheld by the Chair

Assent withheld because, in the opinion of the Chair, a decision would shortly be arrived at without that Motion

Result of Motion and, if a Division, Numbers for and against

and
(2) in the Standing Committees under the following heads:

1

2

3

4

5

Date when Closure claimed, and by whom

Question before Committee when claimed

Whether assent given to Motion or withheld by the Chair

Assent withheld because, in the opinion of the Chair, a decision would shortly be arrived at without that Motion

Result of Motion and, if a Division, Numbers for and against

and
(b) applications of Standing Order No. 28 (Powers of Chair to propose question) during Session 1987–88:
(1) in the House and in Committee of the whole House, under the following heads:

1

2

3

4

5

Date when Closure claimed, and by whom

Whether in House or Committee

Whether claimed in respect of Motion or Amendment

Whether assent given to Motion or withheld by the Chair

Result of Motion, and, if a Division, Number for and against

and
(2) in the Standing Commitees under the following heads:
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(1) the total number of Questions to Ministers or other Members which stood on the Order Paper, distinguishing those set down for oral, written answer priority and written respectively, the number of days upon which replies to Questions for oral answers were given in the House; and the total number of Questions for oral answer to which such answers were given in the House;

(2) the total number of Notices of Motions given for an early day;

(3) the number of Members ordered to withdraw from the House under Standing Order No. 42 (Disorderly conduct) showing separately the orders given in the House and those given in Committee; and the Members suspended from the service of the House under Standing Order No. 43 (Order in debate) or otherwise, distinguishing whether the offence was committed in the House or in Committee, the period of such suspension, the number of occasions on which more than one Member was so suspended having jointly disregarded the authority of the chair, and the number of occasions on which the attention of the House was called to the need for recourse to force to compel obedience to Mr. Speaker's direction; and

(4) the number of public petitions presented to the House distinguishing separately those brought to the Table at the times specified by Standing Order No. 133 (No debate on presentation of petition).—[The First Deputy Chairman of Ways and Means.]

BUSINESS OF THE HOUSE

  CLOSURE AND ALLOCATION OF TIME
  Return ordered,
  Respecting—
  (a) applications of Standing Order No. 35 (Closure of debate) during Session 1987–88:
  (1) in the House and in Committee of the whole House, under the following heads:

  1

  2

  3

  4

  Date when Closure claimed, and by whom

  Whether claimed in respect of Motion or Amendment

  Whether assent given to Motion or withheld by the Chair

  Result of Motion, and, if a Division, Numbers for and against

  —[The First Deputy Chairman of Ways and Means.]
  and
  (c) the number of Bills in respect of which allocation of time orders (distinguishing where appropriate orders supplementary to a previous order) were made under Standing Order No. 81 (Allocation of time to bills), showing in respect of each bill—

  (i) the number of sittings allotted to the consideration of the Bill in Standing Committee by any report of a Business Sub-Committee under Standing Order No. 103 (Business sub-committees) agreed to by the Standing Committee, and the number of sittings of the Standing Committee pursuant thereto; and

  (ii) the number of days or portions of days allotted by the allocation of time order and any supplementary order to the consideration of the Bill at any stage in the House or in committee, together with the number of days upon which proceedings were so taken in the House or in committee.—[The First Deputy Chairman of Ways and Means.]

  DELEGATED LEGISLATION
  Return ordered,
  Of the number of Instruments considered in Session 1987–88 by the Joint Committee and the Select Committee on Statutory Instruments respectively pursuant to their orders of reference, showing in each case the numbers of Instruments subject to the different forms of parliamentary procedure and of those within the Committees' orders of reference for which no parliamentary procedure is prescribed by statute; setting out the grounds on which Instruments may be drawn to the special attention of the House under Standing Order No. 124 (Statutory Instruments (Joint Committee)) and specifying the number of Instruments so reported under each of these grounds; and of the numbers of Instruments considered by a Standing Committee on Statutory Instruments, &c., and by the House respectively, in Session 1987–88, showing the number where the Question on the proceedings relating thereto was put forthwith under Standing Order No. 101(5). —[The First Deputy Chairman of Ways and Means.]

  PRIVATE BILLS AND PRIVATE BUSINESS
  Return ordered,
  Of the Number of Private Bills, Hybrid Bills, Bills for the confirmation of Orders under the Private Legislation Procedure (Scotland), Act 1936, and Bills for confirming Provisional Orders introduced into this House, and brought from the House of Lords, and of Acts passed in Session 1987–88, specifying also the dates of the House's consideration of the several stages of such Bills;
  Of all Private Bills, Hybrid Bills and Bills for confirming Provisional Orders which in Session 1987–88 were reported on by Committees on Opposed Bills or by Committees nominated by the House or partly by the House and partly by the Committee of Selection, together with the names of the selected Members who served on each Committee; the first and also the last day of the sitting of each Committee; the number of days on which each Committee sat; the number of days on which each selected Member served; the number of days occupied by each Bill in Committee; the Bills of which the Preambles were reported to have been proved; the Bills of which the Preambles were reported to have been not proved; and in the case of Bills for confirming Provisional Orders, whether the Provisional Order ought or ought not to be confirmed;
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  Of all Private Bills and Bills for confirming Provisional Orders which in Session 1987–88 were referred by the Committee of Selection to the Committee on Unopposed Bills, together with the names of the Members who served on the Committee; the number of days on which the Committee sat; and the number of days on which each Member attended;
  Of the number of Bills to confirm Orders under the Private Legislation Procedure (Scotland) Act 1936, distinguishing those proceeded with under section 7 and under section 9 respectively; specifying, in the case of Bills proceeded with under section 9 against which petitions were deposited, whether a motion was made to refer the Bill to a joint committee, and if so whether such motion was agreed to, withdrawn, negatived or otherwise disposed of; and stating for each joint committee to which a Bill was referred the names of the Members of this House nominated thereto, the first and last day of the committee's sitting, the number of days on which each joint committee sat for the consideration of the Bill referred to it, the number of days on which each Member of the committee served, and whether the committee reported that the Order ought or ought not to be confirmed.
  And of the number of Private Bills, Hybrid Bills, Bills for the confirmation of Orders under the Private Legislation Procedure (Scotland) Act 1936, and Bills for confirming Provisional Orders withdrawn or not proceeded with by the parties, those Bills being specified which were referred to Committees and dropped during the sittings of the Committee.—[The First Deputy Chairman of Ways and Means.]

  PUBLIC BILLS
  Return ordered,
  Of the number of Public Bills (other than Bills to confirm Provisional Orders and Bills to confirm Orders under the Private Legislation Procedure (Scotland) Act 1936) distinguishing Government from other Bills, introduced into this House, or brought from the House of Lords, during Session 1987–88, showing: (1) the number which received the Royal Assent, and (2) the number which did not receive the Royal Assent, indicating those which were introduced into but not passed by this House, those passed by this House but not by the House of Lords, those passed by the House of Lords but not by this House, those passed by both Houses but Amendments not agreed to; and distinguishing the stages at which such Bills were dropped, postponed or rejected in either House of Parliament, or the stages which such Bills had reached by the time of Prorogation.—[The First Deputy Chairman of Ways and Means.]

  SITTINGS OF THE HOUSE
  Return ordered,
  Of the days on which the House sat in Session 1987–88, stating for each day the day of the month and day of the week, the hour of the meeting, and the hour of the adjournment; the total numbers of hours occupied in the sittings of the House; and the average time; showing the number of hours on which the House sat each day, and the number of hours after the time appointed for the interruption of business and specifying, for each principal type of business before the House, how much time was spent thereon, distinguishing from the total the time spent after the hour appointed for the interruption of business.—[The First Deputy Chairman of Ways and Means.]

  SPECIAL PROCEDURE ORDERS
  Return ordered,
  Of the number of Special Procedure Orders presented in Session 1987–88, the number withdrawn; the number annulled; the number against which Petitions or copies of Petitions were deposited; the number of Petitions of General Objection and for Amendment respectively considered by the Chairmen; the number of such petitions certified by the Chairmen as proper to be received, and the number certified by them as being Petitions of General Objection and for Amendment respectively; the number referred to a Joint Committee of both Houses; the number reported with Amendments by a Joint Committee, and the number in relation to which a Joint Committee reported that the Order be not approved and be amended respectively; and the number of Bills introduced for the confirmation of Special Procedure Orders:
  Of Special Procedure Orders which, in Session 1987–88, were referred to a Joint Committee, together with the names of the Commons Members who served on each Committee; the number of days on which each Committee sat; and the number of days on which each such Member attended.—[The First Deputy Chairman of Ways and Means.]

  STANDING COMMITTEES
  Return ordered,
  For Session 1987–88 of (1) the total number and the names of all Members (including and distinguishing Chairmen) who have been appointed to serve on one or more of the Standing Committees showing, with regard to each of such Members, the number of sittings to which he was summoned and at which he was present; (2) the number of Bills, Estimates, Matters and other items referred to Standing Committees pursuant to Standing Order No. 102 (Standing Committees on Statutory Instruments, &c.), or Standing Order No. 103 (Standing Committees on European Community Documents) considered by all and by each of the Standing Committees, the number of sittings of each Committee and the titles of all Bills, Estimates, Matters and other items as above considered by a Committee, distinguishing where a Bill was a Government Bill or was brought from the House of Lords, and showing in the case of each Bill, Estimate, Matter and other item, the particular Committee by which it was considered, the number of sittings at which it was considered (including, in the case of the Scottish Grand Committee, the number of meetings held in Edinburgh, pursuant to a motion made under Standing Order No. 95(3) (Scottish Grand Committee)) and the number of Members present at each of those sittings.—[The First Deputy Chairman of Ways and Means.]

  SELECT COMMITTEES
  Return ordered,
  For Session 1987–88 of statistics relating to the membership, work costs and staff of Select Committees with so much of the same information as is relevant to the Chairmen's Panel and the Court of Referees.—[The First Deputy Chairman of Ways and Means.]

Oral Answers to Questions
  TRADE AND INDUSTRY

    Household Domestic Appliances
    Mr. Sumberg: To ask the Chancellor of the Duchy of Lancaster what action has been taken by his Department over the past two years to ensure greater safety in the use of domestic household electrical appliances.
    The Parliamentary Under-Secretary of State for Industry and Consumer Affairs (Mr. Eric Forth): Effort has been directed to two main sectors.
    First, regulations have been prepared which set constructional requirements aimed at ensuring the intrinsic electrical safety of household appliances and accessories. Last year, the Plugs and Safety Sockets etc. (Safety) Regulations 1987 were introduced to improve the safety of those items. Consultation has also been carried out on the Low Voltage Electrical Equipment (Safety) Regulations, intended to implement the low voltage directive, which I expect to lay before the House early in the new year. More generally, the Consumer Protection Act 1987 also introduced a new general safety requirement for all consumer goods not covered by specific regulations to be reasonably safe.
    Secondly, promotional campaigns have been undertaken, in conjunction with industry, to heighten awareness of the hazards associated with the use of certain electrical equipment and the ways to minimise those risks. Particular examples have concerned the proper use and maintenance of electric blankets and the enhanced protection against electric shock provided by residual current devices.
    Mr. Sumberg: Does my hon. Friend agree that it is hardly helpful to safety in the home to oblige the disabled, the elderly and the plain incompetent, among whom I number myself, to fit plugs to electrical appliances? Is it not time that we followed the practice on continental Europe and obliged manufacturers to fit moulded plugs on all electrical appliances?
    Mr. Forth: I am charmed, if not seduced, by my hon. Friend's confession of weakness. There is no evidence that safety problems arise in domestic use from plugs not being attached to flexes by manufacturers, so I should be reluctant to make that compulsory. I remind my hon. Friend that 5 to 10 per cent. of households still use the old round-pin plugs, which could give rise to problems.
    Mr. Thurnham: Is my hon. Friend aware that Britain is one of the few countries in the world in which any Tom, Dick or Harry can set up as an electrician? No doubt any Frank, Fritz or Sebastian will soon be able to do so as well. Will my hon. Friend encourage householders to use only qualified electricians? Will he acknowledge the work done by the Electrical Contractors Association in setting high standards of training and encouraging the installation of residual current breakers in every house?
    Mr. Forth: I welcome what my hon. Friend has said. It is of the greatest importance that consumers generally— certainly in the sector that we are discussing—should always try to ensure the competence of a contractor. I

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    encourage the industry to go further in its efforts to ensure that potential users of its services use only the competent and qualified.
    Mr. Kennedy: I listened with interest to the Minister's first response, but something was lacking. Why is he so against making the attachment of plugs compulsory?
    Mr. Forth: I am sorry that I did not carry the hon. Gentleman with me. Not only are we generally against compulsion where it can be avoided, but there is no evidence that plugs not compulsorily attached to electrical flex cause any safety hazard in the home. The hon. Gentleman must concede that some housholds in his constituency may still use the old two-pin plugs. Making the use of square-pin plugs compulsory would thus give rise to problems, perhaps among people on low incomes.

    Rolls-Royce 211-524L Engine
    Mr. Richard Page: To ask the Chancellor of the Duchy of Lancaster when he expects to make an announcement on possible launch-aid for the Rolls-Royce 211-524L engine.
    The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Robert Atkins): Discussions are continuing with Rolls-Royce on its launch-aid application for the RB211-524J and 524L engines. I expect the Government to be in a position to make an announcement on the application early next year.
    Mr. Page: I am disappointed that an announcement will not be available today. I remind my hon. Friend that this engine application will produce the most powerful civil aviation engine in the world, one that will have considerable world markets. As our manufacturing base, although growing and expanding, is still regretfully rather small-as witnessed by our balance of payments problems will my hon. Friend use his considerable charm, influence and persuasion to ensure that, however it is funded, the application goes ahead?
    Mr. Atkins: I am delighted by my hon. Friend's question. My hon. Friend, along with me and those who appreciate the value of Rolls-Royce, recognises that the potential for this engine is not in doubt. Rolls-Royce has a deserved reputation for excellence, which this derivative will enhance. I agree that Rolls-Royce has found the right market. I hope that the engine will be successful.
    Mr. Greg Knight: Will my hon. Friend confirm that, with or without launch-aid, this is an excellent engine and that Rolls-Royce has an excellent safety record?
    Mr. Atkins: Of course I agree with my hon. Friend. I paid a visit to Rolls-Royce in his constituency and recognise the importance of the work force. As usual, my hon. Friend puts the case for his constituents and for Rolls-Royce with the persuasion that we have come to expect.

    Employment, Training and Inner-City Policy
    Mr. Rowe: To ask the Chancellor of the Duchy of Lancaster what discussions he has held concerning employment and training and inner-city policy; and if he will make a statement.
    The Chancellor of the Duchy of Lancaster and Minister of Trade and Industry (Mr. Tony Newton): The measures available under the DTI's enterprise initiative already recognise that some areas of the country require additional assistance to encourage enterprise and growth.
    Mr. Rowe: My right hon. Friend will be aware of some of the evidence given recently to the Select Committee on Employment about the lack of provision for training in some of the urban development corporations. Will he give an assurance that he will take into account some of the excellent suggestions made in that evidence and elsewhere for improving the position, because the need is urgent?
    Mr. Newton: My hon. Friend knows the importance that we attach to employment and training issues in relation to inner-city policy. They are the subject of frequent discussion. I shall certainly take account of my hon. Friend's comments in considering the points made.
    Mr. Vaz: When the right hon. Gentleman considers future inner-city policy, will he learn from the mistakes that were made with the establishment of the inner-city task forces? Will he ensure that local authorities, such as mine in Leicester, are consulted fully before any of these policies are put into effect? Will he also consider extending the inner-city initiatives to the outer areas of cities, which suffer from similar problems to those in inner-city areas?
    Mr. Newton: As it happens, I was in Leicester yesterday and visited the task force area with which the hon. Gentleman is concerned. It seems to be doing very good work. I must say gently that it takes two to achieve the degree of co-operation that the hon. Gentleman and I would like to see. I hope that it will be possible to work as co-operatively as both of us would like.
    On the hon. Gentleman's other point, of course there are other places which suffer significant problems and that is one point that we shall bear in mind as we consider the deployment of the task force effort.

    Investment Media
    Mr. Dykes: To ask the Chancellor of the Duchy of Lancaster when he next intends to meet his European Community counterparts to discuss the equalisation of funding conditions for unit trusts and similar investment media throughout all the European Community member states.
    The Parliamentary Under-Secretary of State for Corporate Affairs (Mr. Francis Maude): I regularly meet my European Community counterparts to discuss matters of mutual interest and concern. These include the sorts of matters indicated by my hon. Friend.
    Mr. Dykes: May I eschew the ghastly phrase "level playing fields" and ask my colleague whether he will work hard from now on to achieve the equalisation and harmonisation of conditions for these unit trust groups, both British and foreign? Does my hon. Friend agree that there should be equalisation of distribution and marketing provision in all member states as soon as possible? Does he agree also that insurance groups launching unit trusts and other similar instruments should not be able to conceal the real net charges from unit trust purchasers, but should reveal the same charges as other genuine unit trust groups?
    Mr. Maude: All unit trusts, whether produced by insurance companies, specialised unit trust companies or anyone else, have to meet the same terms and conditions. I am delighted that my hon. Friend did not talk about level playing fields. In the time that I have been doing this job, I have heard a great deal about playing fields but have never come across one which people agreed was level.
    We must ensure that such products are readily marketable across Europe. Under the directive that comes into force next October, it will be possible for a unit trust which is authorised in one Community country to be marketed throughout the Community, but it will have to be marketed subject to the rules of the country in which it is being marketed. There would therefore be no question of products authorised elsewhere but marketed in the United Kingdom being subject to a laxer regime.
    Mr. Teddy Taylor: Is my hon. Friend aware of the very real concern for the safety of the investing public if foreign financial intermediaries can operate in this country without qualifying under the Securities and Investments Board or FIMBRA? Can he assure the investing public in Britain that any financial intermediary operating in the United Kingdom will have to meet the high qualifications and standards of FIMBRA?
    Mr. Maude: Certainly. As I indicated, under the directive which covers unit trusts and collective investment schemes it will be essential for those products to be marketed in a country subject to the marketing rules of that country. There can therefore be no question of intermediaries, no matter where they are based, selling those products in the United Kingdom being subject to anything other than the United Kingdom rules.
    There is a further directive which affects investment services more generally. As I understand it—it is still in an early stage of negotiation—it will have the same broad division, so that services being promoted in one country will be subject to the conduct of business rules for that country.

    Regional Assistance
    Ms. Armstrong: To ask the Chancellor of the Duchy of Lancaster if he has any plans to announce new measures to boost the economies of Britain's regions.
    Mr. Newton: There is already a range of such measures which we shall continue to pursue vigorously. They are contributing to the economic revival which is clearly taking place in the regions.
    Ms. Armstrong: Does the Minister recognise that there is still a great difference between regions in terms of economic prosperity and deveopment and that, in some regions, there is almost over-capacity, whereas in others we are desperately looking for ways in which we can become self-sufficient? Self-sufficiency demands productive industries, research and development and skill-based industries. What does the Minister intend to do to ensure that we have that base from which we can then properly grow?
    Mr. Newton: I certainly recognise that there are still substantial differences between regions, but those regions that have had a particularly difficult time are now showing signs of a very strong revival. It is, of course, right that they should have the appropriate economic and industrial
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    base, but the mix of that base will be different from that upon which they have traditionally depended, because the world has changed. In the case of the hon. Lady's region, the north-east, it seems to me that what is happening—notably but by no means only as a result of the arrival of Nissan—is generating exactly the sort of new skill base through its effects on training, for example, that we want to see.
    Mr. Andy Stewart: Did my right hon. Friend read The Independent on Monday where he would have seen, listed constituency by constituency, the drop in unemployment? If he did, he would see that Sherwood, my constituency, was second from the bottom. That is due to an unprecedented reduction in manpower in the mining industry. We do not yet qualify for Government or EEC aid. Will he reconsider advising the EEC that we need such aid in the constituency of Sherwood? Better still, would he care to visit my constituency at the earliest possible opportunity to see what can be done about improving our prospects?
    Mr. Newton: I did read the tables in The Independent on Monday and they were indeed interesting. Although I did not visit my hon. Friend's constituency yesterday, I visited Leicester and Nottingham and discussed a numbr of those problems with Nottingham city council and Nottinghamshire county council. I am very much aware of the problems being created by the decline of mining employment and the British Government have indicated their support for some of the proposals put forward in respect of the point raised by my hon. Friend.
    Mr. James Lamond: Does the Minister recognise that certain industries are heavily concentrated in some regions, such as textiles in the north-west? Now that the textile industry is facing difficulties once again, does the right hon. Gentleman have any special measures that he intends to put into operation—such as additional finance to Inward, the development agency in the north-west—to enable any temporary difficulties which may arise because of the decline of certain industries to be overcome?
    Mr. Newton: I have no specific additional measures in mind of the sort that the hon. Gentleman suggested. As I said in the main answer, there is a range of measures—including regional selective assistance—designed to encourage the development of new industries in the regions. Our record in attracting and encouraging new inward investment in all parts of the country is already considerable. We shall seek to build further on that.
    Mr. Conway: Will my right hon. Friend take it from a former board member of the North of England Development Council that any colleague in this place who visits the assisted areas will see a marked improvement on the days when the Labour Government were implementing their broad-brush policies? Since the Government introduced their policy of targeting help, which is designed to create employment, there has been a vast improvement, as Labour Members well know.
    Mr. Newton: I agree with my hon. Friend. As I have said in answering earlier questions, I have been visiting some of the regions. There is no doubt that the sense of confidence and optimism is far greater than it was even a year or two ago.
    Mr. Caborn: Is the Minister aware of the report on the regional impact of the single market of 1992 which has been produced by the department of applied economics at the University of Cambridge? One of the conclusions reads:
    "Regional policy needs to be significantly strengthened if 1992 is not to be disastrous for the regions".
    The report's conclusions have been endorsed by the regional policy director of the Community. Is the Minister telling the House that we are leaving regional policy in 1992 to market forces?
    Mr. Newton: I am not saying any such thing. We have a substantial range of measures and we shall continue to press them vigorously. There are undoubtedly implications for the regions in 1992. For example, they will need to have good transport links with the markets of Europe, and my right hon. Friend the Secretary of State for Transport is actively pursuing that aspect.
    Mr. Batiste: Does my right hon. Friend agree that the best way to stimulate the economies of the regions is through the creation of genuinely local enterprise cultures, and that the most effective way of starting those cultures in areas of high unemployment where the economy is dominated by local authorities is for the authorities to put out to genuine tender as many of their services as possible?
    Mr. Newton: I am sure that that approach could make a contribution. Also important is the work of local enterprise agencies, in many of which local authorities play an important part. I welcome the growing number of private sector initiatives which are directed at producing exactly the sort of culture that my hon. Friend rightly advocates.

    British Engineering
    Ms. Quin: To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the prospects for British engineering, in the light of the proposals to complete the European internal market in 1992.
    Mr. Newton: The creation of the single European market is opening up opportunities for all sectors of United Kingdom industry, including engineering. Our "Europe Open for Business" campaign is designed to assist firms of all kinds to take advantage of those opportunities.
    Ms. Quin: Given the importance of engineering to areas such as the north-east, and the enormous trade deficit in manufactured goods between the United Kingdom and the rest of the EEC, will the Government take every measure to ensure that British engineering derives some advantage from 1992? Or will engineering be allowed to go the way of so many other older industries, especially those in the north-east at this time?
    Mr. Newton: There is no question of our allowing the engineering industry, or any other, to go into decline for want of anything that the Government can do to help it to have a competitive and viable future. The range of our policies has greatly contributed to an overall increase in the competitiveness of British industry, and the engineering industry, amongst others, is gaining from that.
    Mr. Dickens: Does my right hon. Friend agree that British industry has a chance of walking tall in 1992 when we move into the single European market? Has this chance
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    not been based on the marvellous training schemes that we have introduced? People have been given new skills that can lead towards meaningful jobs. We no longer have the stupid overmanning that was to be found under the Labour Government. Is it not a fact that industry now delivers goods on time, of the the right quality, at competitive prices, with good after-sales service?
    Mr. Newton: I think that the answer to all those questions is yes. I only wish that I could imitate the style with which my hon. Friend put the points.
    Mr. George Howarth: Does the Minister accept that even with expansion of opportunity in the engineering industry there will be a severe skill shortage, which will create difficulties?
    Mr. Newton: There are problems of skill shortages in that and other industries, including the construction industry. The proposals put forward by my right hon. Friend the Secretary of State for Employment earlier this week are directed at precisely such problems.
    Mr. Bowis: Does my right hon. Friend agree that for engineering firms to do well in 1992 and beyond there is a great need for more young people to come into engineering? Will he encourage firms to keep close to the world of education—schools, colleges and higher education—so that, in particular, more women come into the industry and more poeple take joint courses in engineering and modern languages?
    Mr. Newton: Yes, those are among the objectives of the industry education compacts, which we are taking a number of steps to encourage, and very much in line with the proposals that my right hon. Friend the Secretary of State for Employment brought forward a couple of days ago.
    Mr. Henderson: How does the Minister explain the deterioration in the trade gap with the EEC in engineering products from £350 million in 1979 to a deficit of £2 billion in 1988? What specific steps will he take to prevent a further deterioration by 1992 and beyond?
    Mr. Newton: I attribute much of that problem to the economic policies that were pursued prior to 1979, and I expect there to be continuing advantage to the engineering industry, as to others, from the policies that have been pursued since then.
    Mr. Riddick: Does my right hon. Friend agree that the prospects for British engineering will be further improved with the privatisation of British Steel? With a privatised steel industry, we can expect prices to be stabilised, or even reduced, as the industry becomes more efficient and competitive.
    Mr. Newton: I hope that that forecast is right. I am certain that my hon. Friend's analysis that the prospects for British Steel have been improved is correct.

    World Trade
    Mr. Robert Hughes: To ask the Chancellor of the Duchy of Lancaster how much Britain's share of world trade has changed since 1979.
    The Minister for Trade (Mr. Alan Clark): Since the beginning of the decade our share of world trade in manufactures has held steady. Our share of trade in invisibles continues to increase.
    Mr. Hughes: Is not the true state of affairs that Britain's share of world trade has dropped from 9·1 per cent. in 1979 to 7·9 per cent. in the first quarter of this year? Whatever twisted logic the Minister may use, he cannot disguise his failure. What does he intend to do to improve British competitiveness?
    Mr. Clark: I do not need twisted logic, because the hon. Gentleman circulated the text of the supplementary question that he has just declaimed fairly widely. It begins "Dear Bob" and is headed "Your question 11 tomorrow." It is signed by the hon. Member for Norwich, South (Mr. Garrett), and says exactly what the hon. Member for Aberdeen, North (Mr. Hughes) should do. I tried to get hold of the hon. Gentleman to help him with his figures because I did not think that the House would consider that a fall from 8·1 to 7·9 per cent. was of seismic proportions. The hon. Gentleman will be glad to know that the figure has now gone up from 7·9 to 8·2 per cent.
    Mr. Robert Hughes: On a point of order, Mr. Speaker. I wonder whether you can make inquiries about whether the Minister has been reading private correspondence which has not been properly handed on.
    Mr. Clark: Further to that point of order, Mr. Speaker. The hon. Gentleman is presumably not aware that he shares both Christian name and surname with my hon. Friend the Member for Harrow, West (Mr. Hughes). Due to over-profligacy, I assume, in circulating the text, it was sent to everyone who carries his name—or was it?
    Mr. Beaumont-Dark: Does my hon. Friend agree that one of the great problems that we face in world trade is the fact that the pound continues to go higher? If the pound is allowed to continue its rise against the currencies of our competitor countries, is it not possible that we may return to the position of 1979 to 1981, which would be hugely damaging to manufacturing industry? [HON. MEMBERS: "Hear, hear."]
    Mr. Clark: My hon. Friend has his view, which seems to be widely shared by Opposition Members. The paradox is that Opposition Members and others declare simultaneously that the balance of payments deficit will lead to a sterling crisis, by which I assume they mean that the value of sterling will fall, not rise. That paradox may benefit from the attention of Lady Antonia Fraser's think tank.
    Mr. John Garrett: Will the Minister confirm that the Chancellor's Autumn Statement forecast that this year British non-oil exports would increase by less than the growth in world trade and that we would continue to lose our market share? What representations have he or his colleagues made to the Chancellor about his policy of forcing up interest rates and thus further damaging our international competitiveness in manufacturing?
    Mr. Clark: Industry is largely united in its view that it prefers increased interest rates to increased inflation. I did not know that my right hon. Friend had forecast that in his Autumn Statement, but I draw to his and to the hon.
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    Gentleman's attention the fact that, as I told the hon. Member for Aberdeen, North, in the first six months of this year our share increased from 7·9 to 8·2 per cent.

    HOTOL
    Mr. Jack: To ask the Chancellor of the Duchy of Lancaster what measures he has taken to promote and encourage overseas participation in the HOTOL project.
    Mr. Atkins: It is for Rolls-Royce and British Aerospace to determine jointly which pattern of international collaboration they wish to explore and we will support them in that endeavour. Following a visit that I made recently to Washington, where I met Dr. Graham, the President's science adviser at the White House, I am pleased to tell the House that avenues have been established for the companies to pursue discussions with their American counterparts.
    Mr. Jack: In welcoming my hon. Friend's positive statement about future developments in respect of HOTOL, may I ask him to confirm that the only real future for the project depends upon putting together international consortia with a vested interest in launching satellites? While he encourages that development, will he ensure that the companies participating in the materials development, technology and avionics associated with the project have sufficient encouragement from his Department to continue the work? We must not allow the project to wither on the vine.
    Mr. Atkins: My hon. Friend is right. I can do no better than quote from a recent report in the United States by a group of people from the United States and other nations. It concluded that it was
    "economically and technologically impossible for any single country or company to develop an HSCT aircraft."
    Collaboration must be the order of the day.
    Mr. Wood: Bearing in mind that HOTOL holds the prospect of a reduction by a factor of four in the cost of satellite launches, which would benefit broadcasters, telecommunications networks and defence departments, is it not extremely important that the industries involved should co-operate internationally in this venture?
    Mr. Atkins: As my hon. Friend knows, it will cost many billions of pounds to develop HOTOL. The early stages of such activity will require relatively small sums of about £2 million to £3 million a year, which it is well within the capability of the companies involved to provide. My hon. Friend is right to say that this is an innovative project that deserves consideration, and we are doing just that.

    Exporters (Support Scheme)
    Mr. Cran: To ask the Chancellor of the Duchy of Lancaster if he will report on the progress being made with his Department's review of support schemes for exporters; and when he expects the review to be completed.
    Mr. Alan Clark: Good progress is being made. My right hon. and noble Friend expects to announce the results of the review in the new year.
    Mr. Cran: Does my hon. Friend agree that a strong case can be made for encouraging exporting companies to use sources of market information other than those provided

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    under the aegis of his Department, if for no other reason than that, although companies appreciate the service, they have complained about the variability and quality of the service that they receive?
    Mr. Clark: I have heard no complaints, but I hope that my hon. Friend will let me know if he does. Of course, it is open to companies to use the private sector. As part of the enterprise initiative, we are actively enrolling the private sector in a consultancy role.
    Mr. Cryer: Would not any support scheme for exporters, which is vital in view of our massive balance of payments and trade deficit, be subject to Commission interference? Is it not particularly important that there should be export schemes to assist manufacturing industry in view of the £11 billion deficit with other EEC countries? Are not our membership of the EEC and high interest rates forced up by the Chancellor of the Exchequer sounding a death knell for yet more jobs in manufacturing industry, over and above the 2 million already destroyed by the Tory Government since 1979?
    Mr. Clark: Straight export subsidies, as the hon. Gentleman knows, are banned under article 16 of the GATT and article 9 of the subsidies code. I admit that there is a grey area within the European Community and practices there. Right hon. and hon. Members must weigh—and this is reflected in their correspondence—the relative advantages that their constituents can sometimes derive from Community grants as producers against the threats and dangers to which they may be subjected from their Community competitors, who also benefit from them.
    Mr. Ian Bruce: Will my hon. Friend comment on the way that his Department works with the Foreign and Commonwealth Office in supporting the efforts of British embassies? Does he agree that simple measures to monitor what is needed in export markets are often more cost-effective than grand dinners and soirees, where most of the money is spent rather than on practical measures?
    Mr. Clark: My hon. Friend is right in his implication that the bulk of the £100 million a year spent on export promotion is disposed of by the Foreign and Commonwealth Office. The relative merits of entertaining and hard fact finding depend on one's viewpoint.
    Mr. Cryer: And on one's taste buds!
    Mr. Clark: On every occasion that I visit a foreign capital, I make a point of calling on our commercial section there, and I am impressed by the increasingly rising standards of service, dedication and efficiency of the commercial sections of our posts overseas.
    Ms. Short: The Minister will remember the terrible effect on our exports and on manufacturing employment— which is now showing in our balance of payments problems—of the recession following 1979, largely caused by high interest rates. Is he not worried that with the high interest rates that we have now, the prospect of their increasing still higher, and 1992—when, senior British industrialists predict, one in two factories will close—we shall see another mammoth recession unless the Government act on interest rates?
    Mr. Clark: Interest rates are principally a matter for my right hon. Friend the Chancellor of the Exchequer. Many reasons have been advanced for the 1974–75 crisis.
    Ms. Short: I was speaking of 1979.
    Mr. Clark: It is generally accepted that it is a matter of cause and effect and that at that time high interest rates were a consequence of developments such as high oil prices. At present, we have a fall in oil prices.

    1992 Hotline
    Mr. Jacques Arnold: To ask the Chancellor of the Duchy of Lancaster how many calls have been received by his Department's 1992 hotline; and if he will make a statement.
    Mr. Maude: DTI's 1992 hotline has received over 105,000 calls since it opened on 18 March.
    Mr. Arnold: Does my hon. Friend consider that it is important that the hotline should bring to the attention of business men the significance of the enterprise initiative and of the many ways in which they can be given assistance in responding to 1992?
    Mr. Maude: My hon. Friend is right. There are a number of ways in which help and advice can be given to businesses as they adapt for the changes coming with the completion of the single market. No business in the length and breadth of the United Kingdom will be wholly exempt from the changes, and every one of them needs to look to its laurels to ensure that it is able to take advantage of the opportunities that will be forthcoming.
    Mr. Harry Greenway: Is my hon. Friend aware that many businesses all over the world are considering coming to this country as a means of building a bridge into Europe with 1992 in prospect? Is he in favour of that as a means of inspiring more business and more employment in this country, and if so, what is he doing about it?
    Mr. Maude: We have always had an open attitude to businesses which seek to establish themselves in this country. We have welcomed that and it has been enormously beneficial to us. It is a process that works both ways. The United Kingdom is now the second largest holder of external assets in the world, second only to Japan. That is a consequence of our having that open attitude to investment flowing both into and out of the United Kingdom.

    Airbus Industrie
    Mr. David Evans: To ask the Chancellor of the Duchy of Lancaster when he last met representatives of Airbus Industrie.
    Mr. Atkins: My right hon. and noble Friend the Secretary of State for Trade and Industry and I last met representatives of Airbus Industrie at a meeting of Airbus Ministers from the four partner countries held on 17 November 1988.
    Mr. Evans: Is my hon. Friend aware that the president of Airbus Industrie is German and that the managing director is French? In an important meeting on 15

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    December, will he support the view that the financial director should be a British subject, in the interests of British Aerospace and the British people?
    Mr. Atkins: Yes, Sir.
    Mr. Hoyle: Has the Minister discussed with Airbus Industrie the disappointment over the fact that British Airways went to Boeing in America rather than to Europe and that it is now the only major national carrier not using the European Airbus to any great extent? That disappointment is felt even when taking into account the Airbus orders that it inherited from British Caledonian.
    Mr. Atkins: I understand the hon. Gentleman's point. However, Rolls-Royce engines will be used on a variety of—
    Mr. Hoyle: Not on 737s.
    Mr. Atkins: No, not on 737s, but on a variety of the aircraft that have been purchased. In an industry that is as collaborative as the aerospace industry, a wide variety of British companies are already involved in a wide variety of Boeing aircraft, not least, for example, Shorts and Rolls-Royce. The hon. Gentleman's point is well taken.
    Mr. Bill Walker: When my hon. Friend next meets the members of Airbus Industrie, will he draw to their attention the way in which Britain has brought about financial discipline in the market place by requiring companies to show clearly how they operate and how they are funded? That is important because Airbus Industrie, which is an essential part of European aircraft collaboration, must be seen in the United Kingdom and elsewhere as a company whose accounts can be noted and accounted for.
    Mr. Atkins: My hon. Friend is correct in his assessment. Obviously, those in the industry know how successful the recent versions of the Airbus have been, particularly in competition with American manufacturers. It is all the more important, therefore, that we ensure that administratively and financially the company has a secure long-term future to offer customers and employees.
    Mr. Stott: Further to the point raised by my hon. Friend the Member for Warrington, North (Mr. Hoyle), given the fact that the British taxpayer has paid millions of pounds in launch-aid for the Airbus A320, that many thousands of jobs in British Aerospace depend on future sales of that aircraft, and that British Aerospace has decided to buy the Boeing 737 400 series, which does not have the Rolls-Royce engine, can the Minister quantify what that purchase will mean to the balance of payments?
    Mr. Atkins: The hon. Gentleman will not be surprised to know that I cannot do that off the top of my head. However, I emphasise what I said earlier. The aerospace industry is a collaborative industry involving a wide variety of manufacturers, in a wide variety of aspects, whether they be airframe, engines or avionics. In those circumstances, although I was as disappointed as many other people that British Airways felt that it could not buy the A320, the reason behind its decision was that it wanted a range that was not available by the purchase of the A320. That is a commercial matter for a company which is already involved with a variety of British companies in other aspects of Boeing aircraft, not least Rolls-Royce engines on the rest of its fleet.
    Mr. Grylls: Further to the good point made by my hon. Friend the Member for Tayside, North (Mr. Walker) about the organisation of Airbus, following the report by Sir Jeffrey Sterling, when will Airbus Industrie be turned into a company that actually has a balance—that would be a step forward—and when will it have a finance director? I understand that it does not have one at present.
    Mr. Atkins: In the context of Airbus ministerial meetings, we are working hard to ensure that we can achieve the ideal to which my hon. Friends have drawn the attention of the House. 1 hope that we can achieve it sooner rather than later.

    House Prices
    Mr. Michael: To ask the Chancellor of the Duchy of Lancaster what assessment he has made of the impact on the housing market, and on would-be first-time housebuyers in particular, of house price rises during 1988; and what proposals he has to regulate estate agents and others involved in that market as a consequence.
    Mr. Forth: I am pleased to see that home ownership in 1988 has continued to increase and that the proportion of homes in owner-occupation is at record levels. However, I am aware that some prospective home buyers experienced difficulties during the very active market conditions in July of this year and that the operation of the property transfer systems remains a matter of some public concern. Therefore, I have been conducting a wide-ranging programme of discussions with the leading estate agency bodies and other interested parties to consider the practices of estate agents in the operation of the property transfer system and the possible scope for self-regulation by estate agents.
    The Government's interim conclusions on the relevant issues were outlined in a recent speech given by my right hon. Friend the Chancellor of the Duchy of Lancaster. I have placed copies of the text of his speech in the House Library for reference.
    Mr. Michael: Does the Minister accept that his tears are meaningless in the context of inactivity and that those who were hurt in the scramble of house prices earlier this year were new and would-be house buyers? Discussions with estate agents do nothing to bring in regulation of the market, which is what the Minister should do as part of the Government's acceptance of their responsibilities.
    Mr. Forth: I am not entirely sure what the operation of estate agencies has to do with any difficulties that first-time buyers might have. It is instructive to note that the ratio of average income of first-time house buyers to the average price of houses has scarcely changed over the past 10 years. We should be careful before we rush to any conclusions about regulating a market which, generally speaking, has operated successfully and brought us to a position in which over two thirds of the people of this country are proud owner-occupiers.
    Mr. Andrew MacKay: Does my hon. Friend agree that there is a silver lining to the high increases in house prices in the south-east, namely, that market forces are now working? As employers cannot find labour in the south-east, they are seriously considering moving to areas

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    where house prices are much lower and labour is more plentiful, which will obviously help employment throughout the country.
    Mr. Forth: Yes, I agree with my hon. Friend. He and I know, but I doubt whether Opposition Members will ever learn, that the operation of the market overall and in the longer term is always to the benefit of the people of this country.
    Mr. Andrew F. Bennett: Does the Minister accept that there is not only a record number of home owners but a record number of repossessions? Does he accept also that there is concern that estate agents do not get the best possible prices for repossessed houses? The individual not only loses his home but ends up in debt. As repossession often occurs because of high interest rates and the problems of having to live on benefits, will the Government do something at least to make sure that estate agents get the full market value for repossessed homes?
    Mr. Forth: I congratulate the hon. Gentleman on his elevation to the Back Benches. I hope that his knowledge of estate agency matters will soon match his knowledge of education. If the hon. Gentleman has any specific cases that he wants to bring to my attention I should be grateful to know about them, because I will then be able to add them to the evidence that I have been gathering about the operation of estate agents over the past few months.

    CBI (Merger Policy)
    Mr. Ian Taylor: To ask the Chancellor of the Duchy of Lancaster what discussions he has had with the Confederation of British Industry regarding the proposed reform of the law on mergers.
    Mr. Maude: I have had no such discussions recently. However, the improvements to merger control procedures that we are proposing arose from our review of mergers policy, to which the CBI submitted views.
    Mr. Taylor: When my hon. Friend next has discussions with the CBI, will he remind it that many of its members are now successfully making acquisitions in other countries and that, rather than introduce protectionism in the domestic market and tinker with the takeover code, the way forward is for it to back my hon. Friend's efforts to remove restrictions in other countries, particularly within the European Community?
    Mr. Maude: It is worth pointing out that for the last 12 months for which figures are available, till September of this year, the value of acquisitions by United Kingdom companies overseas was slightly more than double the value of acquisitions in the United Kingdom by overseas companies. The policy of openness that we have espoused has been beneficial for the United Kingdom. My hon. Friend is absolutely right in saying that barriers to takeovers are being mounted in other countries within the European Community. I have asked the European Commission to bring forward proposals to address some of the barriers, and I have had an encouraging response.
    Mr. Austin Mitchell: Why does the Minister not admit that the Government's merger policy has been a total disaster? It has been diluted, it takes no account of jobs, industrial logic or the national interest and it has encouraged an orgy of speculation and takeover, rather
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    than investment, which has reached record heights in the last quarter. All the research shows that there has been not overall benefit, but overall harm, from those takeovers, yet the Government have dithered on with their review of policy. Why does the Minister not come out with the truth and tell us that the Government's only mergers policy is a great big "for sale" notice over British industry?
    Mr. Maude: It is difficult to know which of the hon. Gentleman's propositions is more wrong. He has got it wrong all the way down the line. We have made clear our policy. We shall refer mergers when a competition issue arises. We would not ordinarily refer mergers on any other basis, although it is not an exclusive criterion. As the figures that I have just given show, the fact is that we have been benefiting enormously from having a broadly open policy towards acquisitions. The result is that we have United Kingdom externally owned assets which are higher than those of any other country, except Japan. I should have thought that that would make the hon. Gentleman, with his well-known nationalism, rather proud.

    Shorts of Belfast
    Mr. Cash: To ask the Chancellor of the Duchy of Lancaster what is the extent of the financial interest of the Department of Trade and Industry in Shorts of Belfast.
    Mr. Atkins: I want my hon. Friend to listen carefully. The issued share capital of Short Brothers plc comprises 3,600,000 ordinary shares of £1 each, 7,710,000 A preference shares of £1 each and 79,700,000 B preference shares of £1 each. Of these, my right hon. Friend the Secretary of State for Trade and Industry holds 342,000 ordinary shares and 4,840,000 A preference shares. That adds up to about 10 per cent.
    Mr. Cash: Does my hon. Friend agree that Shorts has an extremely bright future and that it is a company that some of us wish to campaign to privatise? Does he further agree that if my right hon. Friend were prepared to accept such a proposal, it would lead to Shorts having an extremely bright future in the European Community for the next 20 years?
    Mr. Atkins: My hon. Friend is right. Shorts has contributed greatly to British Aerospace success. That is what it is and the House should be aware of it. Its plans for the future, which include privatisation and a new aircraft which it hopes to launch, suggest that its future will be as bright as it has reason to expect on the basis of its past achievements.
    Mr. Cryer: Is not the truth that the attempt to privatise Shorts produces uncertainty, and has not our experience of privatisation shown that it always leads to sackings under the guise of slimming down and improving competitiveness? Surely, in a place like Northern Ireland, it is better to have certainty to reduce the level of unemployment, which must contribute to the sectarian strife there. The Government's recipe is a recipe for disaster.
    Mr. Atkins: The main plans for privatisation will be controlled by my right hon. Friend the Secretary of State for Northern Ireland. As I said, our shareholding is relatively small. I disagree with the hon. Gentleman. I believe that privatisation has proved a success story in the

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    aerospace industry. British Aerospace and Rolls-Royce clearly show what that success has been, and Shorts deserves the same consideration.

    EC (Trade Statistics)
    Mr. John Marshall: To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the growth of United Kingdom trade with the European Economic Community.
    Mr. Alan Clark: We welcome the growth in trade with the European Community. Increased trade widens buyers' choice, encourages greater efficiency, and stimulates growth in the economy as a whole.
    Mr. Marshall: Does my hon. Friend agree that the fact that the European Community takes 50 per cent. of our exports underlines both the potential for 1992 and the folly of those who sought at the 1983 election, and subsequently, to take Britain out of the European Community?
    Mr. Clark: My hon. Friend's point is well taken. I am glad to add another statistic. The value of our exports of manufactures to the European Community is growing at an annual rate of 17 per cent.
    Mr. Wilson: How does the Minister view the prospects for the Scotch whisky industry in the European Community?
    Mr. Clark: Very favourably—as they are throughout the world.
    Mr. Soames: With his well-known enthusiasm for the European Economic Community, does my hon. Friend agree that, although British business has done well in the Community recently, a limiting factor to developing our business is the poor language skills of British managers? Does he agree that the Government should take steps to ensure that companies are much better geared to promote their goods in the countries to which they are trying to sell them?
    Mr. Clark: My hon. Friend is entirely right. One problem is that so many of our customers speak English —of a kind. That sometimes deludes British exporters into thinking that they can reply at length, deliver technical specifications and issue sales literature in English. In fact, the sooner they realise that it is essential to circulate their literature and to converse in, if possible, the language of their customers, the better their prospects.

    Manufacturing Industry (Investment)
    Mr. Tony Lloyd: To ask the Chancellor of the Duchy of Lancaster by what percentage in constant value terms investment in manufacturing industries has changed from 1979 to the latest date for which figures are available.
    Mr. Atkins: Investment in manufacturing industry, including leased assets, in the first three quarters of 1988 is provisionally estimated to have been only 1·5 per cent. below the 1979 average level in constant value terms. However, it was 10 per cent. greater than in the same period a year earlier, and this strong growth is forecast to continue.
    Mr. Lloyd: Given those rather pathetic figures. will the Minister speculate whether the failure of manufacturing industry to invest in its and our future has any relationship with the massive and growing balance of payments crisis facing this country? What do the Government intend to do to stimulate investment?
    Mr. Atkins: The hon. Gentleman has been here long enough to be aware that there was a world recession. in 1980–81. We were not unique in suffering from that recession. The fact is that investment is at an all-time high. The CBI forecasts a rise of 14·5 per cent. this year and a further rise of 9 per cent. next year. That appears to fly in the face of what the hon. Gentleman is suggesting.

    Enterprise Initiative
    Mr. Harris: To ask the Chancellor of the Duchy of Lancaster how many applications have so far been received for consultancy projects under the enterprise initiative.
    Mr. Forth: My hon. Friend will be pleased to hear that a large and growing number of firms are improving their competitiveness by taking the enterprise initiative. Since January, 15,000 applications have been received for the self-help package of assistance with consultancy projects —2,500 of them in the last six weeks.
    Mr. Harris: Does my hon. Friend agree that this scheme has special value for small firms? Can he give any information about the number of applications made by small firms?
    Mr. Forth: My hon. Friend is right. The initiative is aimed primarily at small firms. We have been delighted with the take-up. I shall tell my hon. Friend what I probably do not need to tell him: we have already received 288 applications for consultancy projects from Cornwall, and 128 projects have been approved for assisted consultancy. I am sure he will agree that this is encouraging. We hope to see this greater progress maintained.

    EH 101 Helicopter
    Mr. Mans: To ask the Chancellor of the Duchy of Lancaster if he will make a statement on progress on the development of the EH 101 helicopter.
    Mr. Atkins: The Anglo-Italian EH 101 helicopter programme is approaching the end of its fifth year of full development. The flight-testing programme has been in progress for over a year and three development aircraft have now flown. Aircraft performance has generally been good, with problems no more than would usually be expected with such a development.
    Mr. Mans: I thank my hon. Friend for that reply. Will he elaborate on the progress of the RTM322 engine built by Rolls-Royce, which will be put in the aircraft at a later date?
    Mr. Atkins: As I have already said, the participation of Rolls-Royce in engine manufacture is proving highly successful, and the RTM322 is no exception. We hope that provision will be made for that engine to be available for the super version, but it is for customers to decide what they want.
    Mr. David Winnick: On a point of Order, Mr. Speaker.
    Mr. Speaker: Order. I shall take the statement from the Chancellor of the Duchy of Lancaster first.

North East Shipbuilders Ltd.
3.30 pm
The Chancellor of the Duchy of Lancaster and Minister of Trade and Industry (Mr. Tony Newton): With permission, Mr. Speaker, I wish to make a further statement about British Shipbuilders.
In my previous statement on 14 November, I was able to report good progress towards a successful sale of most of the remaining elements of British Shipbuilders, following that of Govan earlier in the year. That progress has continued. Agreement is now close for the sale of Clark Kincaid in Greenock and of the Appledore yard in north Devon, and negotiations for the sale of the Ferguson yard at Port Glasgow are under way.
I can additionally report today that I have accepted British Shipbuilders' advice that the preferred bidder for Marine Design Consultants should be the team led by the managing director. Subject to securing further new orders, its bid envisages work being continued in both its Sunderland and Dundee offices. I have asked British Shipbuilders to press ahead with detailed negotiations.
As I said on 14 November, the yards and other facilities that I have mentioned account for five of the six owned by BS, and nearly two thirds of those employed by them, when the process of seeking private sector purchasers was started by my predecessor last April.
The remaining undertaking is, of course, North East Shipbuilders Ltd. at Sunderland.
On 14 November I told the House that, although none of the original bids for NESL had proved acceptable, BS had received three new expressions of interest. To allow time for those to be explored, I was therefore giving until the end of November to establish whether proposals could be developed that gave a firm basis for negotiation. That would entail a clear statement of the work envisaged for the yards, evidence of the technical and financial capacity of the bidder, and the prospect of arrangements likely to be compatible with the European Community sixth directive concerning state support for shipbuilding.
In the event, two of those who had expressed interest prior to 14 November did not submit proposals. The third did so, and two other new proposals also came forward. All three have been carefully considered by British Shipbuilders and its independent financial advisers, against the criteria that I set out.
As a result of that examination, British Shipbuilders' clear advice to me is that none of these proposals could form the basis of a viable future for merchant shipbuilding in the Sunderland yards. None provides evidence of sufficient financial resources, given the major uncertainties of the shipbuilding market. None gives evidence of sufficient work for the future.
Mr. Bob Clay: Nonsense.
Mr. Newton: All would entail levels of subsidy which, in one case in particular, could have faced difficulties under the sixth directive.
Mr. Clay: This is an utter disgrace.
Mr. Newton: Reluctantly, and with great regret, I therefore—[Interruption.]
Mr. Speaker: Order.
Mr. Bob Cryer: The right hon. Gentleman is sacking people. How can we remain silent?
Mr. Speaker: Order.
Mr. Newton: Reluctantly, and with great regret, I therefore have to tell the House that I see no further realistic prospect of maintaining NESL in its present form, and its shipbuilding yards will therefore progressively close as the current work load runs out. [Interruption.]
There remain possibilities, which I have asked—[Interruption.]
Mr. Speaker: Order. Those hon. Gentlemen who have points to make may make them from a standing position when they are called.
Mr. Newton: There remain possibilities, which I have asked BS to make every effort to explore, of selling Sunderland Forge Services, which currently employs nearly 400 people, and interest has also been expressed in one of the yards for purposes other than shipbuilding.
Both my predecessors and I have made it clear that, should it not prove possible for shipbuilding to continue on Wearside, we would bring forward a range of measures to assist those affected and to promote alternative employment in the town.
There will be three main elements. First, we propose a new enterprise zone for Sunderland. [Interruption.]
Mr. Speaker: Order. Let us have the details.
Mr. Newton: As with existing zones, this would mean relief from rates for 10 years for all new developments, a simplified planning regime to help speed up such developments, and 100 per cent. capital allowances on new industrial and commercial development. My right hon. Friend the Secretary of State for the Environment is urgently undertaking the necessary consultations with the European Commission and will give details as soon as possible.
Secondly, I have asked English Estates to start work immediately towards the early provision of over £7 million of advance factory space, over and above its existing commitments in the north-east. This will provide around 220,000 sq ft of high quality factory space for new or expanding businesses.
Thirdly, some £10 million will be made available over the next three years for a programme of measures to encourage new enterprise and employment opportunities in Sunderland. About half will be used to give financial support to new or expanding businesses. The other half will be used to assist the present employees of NESL to develop new skills and find new jobs. My right hon. Friend the Secretary of State for Employment will provide services on the shipyard site to advise the work force on opportunities for jobs and training, including help for those who wish to apply for immediate retraining.
Taken together, the measures that I have announced have a total cost of some £45 million. They will significantly reinforce what is already being done to promote economic development in the area through the enterprise initiative, regional assistance, and the work of the Tyne and Wear urban development corporation, which will itself be announcing a number of new projects shortly as a result of the additional funding of £11 million

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announced on 25 November. I hope that they will also further support and encourage the private sector initiatives that are under way or being considered.
The House will share my regret that, despite every effort, it has not proved possible to find a way forward for NESL. But it must now be right to concentrate on securing a new industrial future for the town, and I believe that we shall have the support of the House in what I have announced to that end.
Mr. John Garrett: The Minister may talk about the failure of bids for NESL, but the fact is that he has just announced a devastating closure. Is the Minister aware that, for no reason other than dogma, he has just announced the destruction of the Sunderland economy and the death of British merchant shipbuilding? What does he think of his Government's Christmas present for families in Sunderland?
Does the Minister accept that this announcement is humiliating evidence of his failure to reverse the policies of his boss? Does he understand that this act of industrial vandalism not only brings to an end 600 years of shipbuilding on the Wear but destroys an essential British industry with a major contribution to make to our industrial and trading future?
Why has privatisation been given priority over the urgent practical need to secure vital orders? Why have months been wasted in finding private owners when all efforts should have been concentrated on obtaining the orders that would have safeguarded the yard's future? Why is the Government's obsession with the dogma of private ownership so much more important than the thousands of jobs on Wearside and the survival of a great British industry?
Why has the Minister ignored the incontrovertible evidence of an upturn in world shipping demand? Why has he chosen this moment to deliver the fatal blow, just when orders are becoming available and this modern and efficient yard is well placed to take advantage of the upturn?
Does the right hon. Gentleman agree—he did not mention this—that a Cuban order worth at least £110 million is available now and that it would secure the future of the yard? Does he further agree that Britain has already sacrificed more shipbuilding capacity than any other EEC country? Does he agree also that this will mean a total loss of about 5,000 jobs in an area of 20 per cent. unemployment and the loss of skills and experience that are essential to the Sunderland community and the nation?
As for the proposed grants, why is the right hon. Gentleman making unemployment worse before doing something about it? Does this event not add to the record of DTI incompetence? Is it not yet another example of a privatisation bungle, along with that of Girobank and the National Engineering Laboratory? Will he even now think again, swallow his prejudices—or rather, those of his master in another place—and concentrate on providing a future for Wearside and British merchant shipbuilding?
Will the Chancellor also reflect on the contrast between the Prime Minister's warm concern for the threatened workers at the Gdansk shipyard and the callous treatment of Sunderland—or does that explain his prevarication? Will he tell the noble Lord from us that this closure is a wilful act of destruction?
Mr. Newton: Far from dogmatically pursuing a particular policy, we have sought to overcome the problems left behind by a period in which British Shipbuilders, as a nationalised concern, has cost the taxpayer almost £2 billion, including losses of about £650 million, of which at least £100 million was lost by NESL in the past three years merely by fulfilling contracts to build ships.
Against that background, it was clear to my predecessor and to me that a solid future for the yards depended on finding new owners who could run them in a viable way. We are on the verge of succeeding in doing that, as I said in my statement, for five out of the six undertakings owned by British Shipbuilders at the outset of the process, covering about two thirds of the work force.
It is a great and genuine regret to me that we have not managed to find a comparable solution for NESL, and it would be manifestly unfair to the people of Sunderland to pretend that proposals that are manifestly not viable, are viable. I am not prepared to bank on hopes of an upturn in world shipbuilding, which are constantly being revised downwards and which have been further revised downwards in the past few months by the Association of West European Shipbuilders, which suggests that any real upturn will come at best in the latter half of the 1990s, not in the first half as it predicted before.
No one can dispute the fact that if £l2 billion had been spent in the past 10 years on providing alternative employment rather than on propping up this industry to make losses we should now be in a better position. I have decided that the right thing to do is to end the uncertainty with the statement I have made this afternoon, and to get on with the job of building a new future for Sunderland.
Mr. Michael Grylls: Does my right hon. Friend accept that his statement detailing the successful privatisation of five of the six remaining yards will bring comfort to those five yards, which will have a more secure future in the private sector? Obviously, for NESL this is a sad day, but will my right hon. Friend remind the company that Corby also had a sad day when the steelworks closed? Today, it is a thriving town with many different firms, large and small. British Steel Corporation (Industry) Ltd. the subsidiary of the then state-owned British Steel, made great efforts to bring new firms to Corby. What was done in Corby can be done in Sunderland, and I am sure that it can be with the help of the measures that my right hon. Friend has announced.
Mr. Newton: My hon. Friend speaks about what has happened in Corby. Consett is another example of a place where comparable proposals have been brought forward to seek to create secure employment for the future. They have met with immense success in recent years and I am determined that we shall have a similar success in Sunderland.
Mr. Chris Mullin: Sunderland has been murdered today, in the same way as Jarrow was murdered by a predecessor Government in 1934. Before today's announcement, male unemployment in Sunderland was running at over 20 per cent. There are whole streets where almost no one is working and generations of children are growing up who may never work. This closure was not inevitable. Orders could have been obtained—the Cuban order, for example—but no

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serious effort was made to obtain them. Will the Minister tell the House why the yard could not be permitted to remain under the existing ownership and management, and why a serious attempt could not be made to obtain the work that we know is available? What will happen to the assets? This is one of the most modern shipyards in Europe. Will its assets be looted, or mothballed against the day when, perhaps, it is possible to revive shipbuilding on the Wear?
Mr. Newton: As I said in my statement, apart from the possibility, which will be pursued vigorously, of selling Sunderland Forge Services, which accounts for about 15 per cent. of the work force at Sunderland, interest has been expressed in at least one of the yards for purposes other than shipbuilding. That, too, will be explored. When those possibilities have been explored, we shall have to consider the future of the yard if it does not prove possible to find such an alternative use.
We were not prepared to do what the hon. Gentleman suggests in the second part of his question. That was because, against the background that I have described of record and persistent heavy losses on almost all shipbuilding contracts made by the yard over many years, we did not think it sensible to continue to proceed with the present structure and management.
May I also say to the hon. Gentleman, without, I hope, too much aggression, that he is doing no service to the people whom he seeks to represent by using the kind of language that he used at the outset of his question. It is no more true that my statement has, to use his words, "murdered Sunderland" than it would be true to say that the arrival of Nissan in Sunderland suddenly overcame all problems. However, it is clear from the arrival of Nissan and other firms that the prospects in the north-east are good. It is worth noting that Nissan alone expects to create 1,900 new jobs in Sunderland in the next few years.
Mr. Neville Trotter: Does my right hon. Friend agree that the people who have murdered shipyards in Europe are the Koreans? They set the world prices for ships and are under-cutting the European yards by 40 per cent. While it is of little comfort to Sunderland, the same thing has happened, and is happening, all over western Europe. It is a matter of deep regret that the sincere and lengthy attempt by my right hon. Friend to save this yard and provide it with a viable future has not been successful. May I ask him for an assurance that there will be speedy action to provide alternative employment in other industries and that further funds will be made available if the initial allocation is insufficient?
Mr. Newton: I assure my hon. Friend that we shall take speedy action and keep the measures that we are taking under constant review to ensure that they are achieving the results that we want. I am grateful to my hon. Friend for what he said about what I have sought to do in the past two or three months, albeit, as things have turned out, I was unsuccessful.
I acknowledge what my hon. Friend said about Korean industry. The arrangements for subsidising European shipbuilding, which have been agreed in the Community, are in part directed at that problem. The difficulty with NESL and, more widely, with British Shipbuilders is that, even with subsidies extending up to 28 per cent. of the cost of a ship, they have still made losses over and above that permitted level of subsidy.
Mr. Clay: Is the Minister aware that four years ago, at a previous time of difficulty, one of his predecessors told shop stewards from NESL and myself that it was not his fault, but the Government's? Sadly, today's announcement is a tragedy as well as a farce. The Minister knows that the Cubans are anxious to place an order with Sunderland yards for 10 mixed-cargo ships and 10,000 containers. They are offering the yard a five-year co-operation deal to plan other work with it. How can the Minister say that no work is immediately available? The truth is that the privatisation on which the Government insisted has turned out to be a shambles.
Does the Minister recognise that it would be logical to allow the yard to take the available order, thereby securing jobs, not murdering them, tearing the heart out of the town and wrecking and frustrating any possible future for British merchant shipbuilding? He has destroyed the work of the past 600 years and any possible future for Sunderland. Shipbrokers and builders know that there will be an upturn in the market. Will he stop the murder of the yard, which is on the point of benefiting from that upturn, and prevent the murder of the town?
Mr. Newton: As to one or two of the hon. Gentleman's latter points, I cannot add to what I said earlier, except that I am told that the Japanese share our view about the diminution in the immediate prospects for an upturn in shipbuilding—a view that I reported as being held by the Association of West European Shipbuilders, which confirmed my doubts.
I hope that the hon. Gentleman will allow me to say that I have the greatest repect for the efforts that he has made in recent weeks to bring forward a package that would enable us to secure a future for the yard, which we both wanted. It is as much a matter of sadness to me as it is to him that I have not felt able to judge that the proposals that the consortium with which he was associated put forward constituted a viable basis for the future of the yards.
Part of that judgment—apart from doubts about its financial strength, based on advice that I received—rested on two facts about the Cuban order. First, there could be no certainty that the order could be secured in the face of international competition. Secondly, such indications as we had about the price that the Cubans would be likely to want to pay for those ships left it doubtful, to put it mildly, that anyone could build the ships without incurring losses. That is not a sensible basis on which to proceed.
Miss Emma Nicholson: I thank my right hon. Friend for the successful conclusion of the Appledore sale. I know that that must be small comfort to Opposition Members, but to my constituents it means much. I join my right hon. Friend in what I know to be sincere sadness and regret at the failure to sell NESL. Anyone who knows and loves the north-east must regret it deeply, and anyone who knows or has worked with my right hon. Friend must know that his regret is genuine and sincere.
Does my right hon. Friend agree that it is wrong to narrow the working futures of our young men and women to declining, huge industries that are rapidly becoming more difficult to continue? We need, most honestly, to offer proper training, proper new work and fresh working

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horizons, or those young men and women will not only not thank the Government, but will most sincerely not thank Her Majesty's Opposition.
Mr. Newton: I am grateful to my hon. Friend for her remarks. I share her pleasure at the prospect of a successful sale of the Appledore yard. I agree that we would be doing no service to anyone by pretending that something provides a future for employment when, in our judgment, it does not.
Dr. Norman A. Godman: Speaking as a former shipwright and, more important, as a Member who represents what was once a famous shipbuilding constituency, may I say how deeply sorry I am for the people of Sunderland. Will not the effects of this closure be felt far beyond that town's confines, as much of the equipment and materials used in the construction of a new ship are produced far away from the shipbuilding community?
To be parochial for a moment, will the Minister give the House an assurance that the Government will continue to support British Shipbuilders' bid for a ferry for Mauritius, irrespective of the negotiations on the takeover of Ferguson in Port Glasgow? Many people will regard the Minister's words vis-a-vis an enterprise zone with deep suspicion, given what has happened to my community following the closure of Scott Lithgow and the sleekit words offered in so-called condolence by his predecessor.
Mr. Newton: On the last point, I cannot add to the emphasis that I have given. The number of extensions of the period for the bids to be considered, and so on, shows clearly how concerned I was to explore every realistic possibility of selling those yards successfully.
On the hon. Gentleman's more specific points, the position with Ferguson is that the bid is not dependent on our obtaining the Mauritius ferry order, but, as I made clear to the Mauritius Government when I was in Mauritius six or eight weeks ago, we would very much like to secure the contract for that ferry. Again, as with the Cubans, there is no doubt that there is intense international competition for that order, as with any other shipbuilding order, and I can make no promises that it will be secured.
Mr. Neil Hamilton: Does my right hon. Friend accept that the Opposition do no service to the people of Wearside by trying to keep a hopelessly unviable enterprise going, any more than the right hon. Member for Chesterfield (Mr. Benn) did the workers of the Meriden motorcycle co-operative a service in trying to keep it going in the 1970s? The only result was that jobs were not secured and many workers lost a lot of money. Is it not far better to concentrate on getting jobs in the industries of the future than to be wedded to those of the past?
Mr. Newton: Over quite a period in Britain, the attempt to prop up industries that were unable to sell their products at a price which other people were prepared to pay and which guaranteed a profit has proved counter-productive to the interests of employment of many of our people. I accept that it is right now to concentrate on building secure jobs for the future, and that is what we are concentrating on.
Mr. John McAllion: The Minister said that the preferred bid for Marine Design Consultants was to that by Sunderland-based management-led buy-out. The right hon. Gentleman and I know that that will eventually lead to closure of the Dundee operation. The right hon. Gentleman knows also that a buy-out plan from the Dundee workers was recently modified following discussions with British Shipbuilders and a proposal by British Shipbuilders to the workers in Dundee. That plan has been submitted to the Minister's Department. Why is he not backing it? Why is he refusing to back the workers in Dundee in trying to keep their jobs and future in the city? Is the right hon. Gentleman content to sell Dundee and Sunderland in the same afternoon?
Mr. Newton: I have agreed with the advice that I was offered by British Shipbuilders, following consultation with its advisers, Lazards, that what I have named as the preferred bidder for Marine Design Consultants offers the best prospect for the future of the operation as a whole. The alternatives appear to have been three interlinked bids, over one of which at least there was considerable doubt about finance. I accepted the advice which I was offered, which seems to make sense as the best way of securing a future for MDC.
Mr. Bowen Wells: Although this was obviously a painful and difficult decision for my right hon. Friend to take, may I congratulate him on concentrating first on those in Sunderland, and their families, who will lose work? Will he either go himself or send one of his colleagues to Sunderland to explain to those people the future which he hopes will be bright and will provide employment and opportunity for them and their children?
Mr. Newton: I can assure my hon. Friend that, quite apart from the visit that I specifically paid to the yards early on in assuming these responsibilities, and the more recent visit only last month to the north-east, I intend to visit the area at an appropriate time when we have had the opportunity to do the further work that will be required on the details of the package that I have announced today.
I have no doubt that we had no real alternative to what I have announced today, but, equally, I have no doubt of our determination to carry through the task of ensuring a good industrial future for Sunderland.
Mr. Charles Kennedy: Further to the question put by the hon. Member for Greenock and Port Glasgow (Dr. Godman), may I confirm to the Minister that Ross-shire is another example of an area where a massive closure has been followed by the creation of an enterprise zone? What proportion of the £45 million package that he has announced for Sunderland is represented by that enterprise zone? Is he aware that the lesson of other enterprise zones, certainly that at Invergordon, is that if too much time and money are devoted to set-up costs, inevitable damage is done to attracting new business? Is the right hon. Gentleman further aware that the economic experience of enterprise zones, particularly in the wake of a closure such as this, which tears the economic base out of a community, is that there is a much more substantial case for them when the local economy is flourishing than when it has suffered the hammer blow that the right hon. Gentleman has announced today?
Mr. Newton: The hon. Gentleman raises two points. First, that part of the £45 million to which I referred, which is represented by the estimated costs of the enterprise zone, is about £25 million spread over a number of years.
On his final point, he second-guessed what I was going to say in reply to him when I had heard only half of his question. Surely the point about the position in the north-east now—I believe this is incontrovertible and would be understood by anyone who has been there recently, as I have on a number of occasions—is that there is already a degree of economic expansion and a greater degree of confidence and optimism, on which the enterprise zone and the other measures that I have announced today will build.
Mr. Phillip Openheim: Although no one can have anything but the deepest sympathy for the people of Sunderland because of the situation that they face, have not a large number of jobs in the shipbuilding industry been lost over a number of years and under a series of different Governments? Is it not true that, even in Japan, shipyards are closing because of the situation in the industry? Is it not further true that it is not in the long-term interests, either of the local economy in Sunderland or of our economy nationally, to keep open unviable and unprofitable industries and to try to compete with producers in the far east, who have proved that they can do the job better than we can?
Mr. Newton: My hon. Friend makes an important point in saying that these problems are by no means confined to Britiain or, indeed, to Europe. Employment in shipbuilding in Japan has fallen by very nearly half in the past 10 years, and in the past four or five years it has fallen faster in a number of European countries than in this country.
Mr. Ted Leadbitter: The Minister will recognise that, after 41 years' public service in the northern region, I have some experience of what the closure of a shipbuilding yard does to a town: it literally murders it. Does he understand that, for the very first time in many years, I have come here with a real sense of anger at this calculated statement? It is convenient after the visit of the Prime Minister to Poland and Gdansk—we know the calculation.
Is the Minister aware that the £45 million package to which he referred would go a long way towards keeping the heart and soul of Sunderland alive, rather than using it to implement this deviating exercise that he has put before the House today? Does he understand that the cost of closure, or the loss of assets and the loss of labour, is sufficient for me to say to him now that if he had the will to keep this yard open he would have done it?
Mr. Newton: I have already said that far more than the £45 million to which I have referred today has been put into North East Shipbuilders, and that ten times that amount has been put into British Shipbuilders as a whole over the past 10 years without producing a situation in which ships could be profitably built and sold. Many people in the House will share my view that, with hindsight, it might have been better if some of that money had been applied to creating alternative employment much earlier.
Mr. John Marshall: How does the £2,000 million that has been poured into the bottomless pit
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of British Shipbuilders compare with the cost of attracting Nissan to Sunderland? Will my right hon. Friend confirm that Nissan will produce, both directly and indirectly, well over 10,000 jobs? Is it not more important to attract sunrise industries than to prop up industries on which the sun set many years ago? Will he also confirm that jobs are safeguarded, not by the Government, but by industry producing the right goods, at the right time, at the right price?
Mr. Newton: I generally agree with my hon. Friend's remarks and, as I have said on several occasions. we are determined that that is precisely what will happen in Sunderland. We shall build on the north-east's success in attracting major inward investment, not only from Nissan, to ensure that jobs in the north-east and in Sunderland in particular will last and produce the goods that people want to buy, at the price they want to pay, and thus give real employment in the long term to the people whom we want to help.
Mr. Roy Beggs: My sympathies go today to the work force and families in Sunderland. I must criticise the Government for the insensitive way in which they have made this announcement, two weeks before Christmas. It is absolutely ridiculous. The same thing happens time and again. The Government should set an example and give a little thought to people's feelings, especially at this time of year.
Has Sunderland been sacrificed to secure the already privatised yards? May I have an assurance that the reasons outlined for the closure of the Sunderland yard will not be parroted off within the next few days to justify the closure of Harland and Wolff in Belfast?
Mr. Newton: The hon. Gentleman will know that my right hon. Friend the Secretary of State for Northern Ireland is making every effort to secure a future for Harland and Wolff. I can certainly assure him that there is no question of the proposition that he put in his question being the case or of Sunderland somehow being sacrificed for the other privatised yards. The reason for my making the announcement today, rather than at an earlier date, as some had pressed upon me, is simply that we gave a considerable extension of time because of our determination to try every possibility.
Sir Giles Shaw: Does my hon. Friend accept that, although I welcome the progress in the disposal of the other assets of British Shipbuilders, no one can possibly welcome the decision that he has announced in respect of NESL? I know some of the facts of the case, and I know that he has made prodigious efforts, including extending the period, not only for the offers and the statement, but to enable late-running offers to be considered, and has given every possible consideration to finding a favourable outcome.
Does my right hon. Friend accept that the consequences of the loss of NESL will be felt throughout the north-east and in Yorkshire, including Darlington and towns in the West Riding, many of which are suppliers, and that this will greatly concern many of us? Does he also accept the general feeling that, although the closure is a catastrophe, it is due to world forces very much beyond the control of the Government and has forced the

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Government to make a £45 million investment to diversify an economy in an area that sorely needs diversification to survive in the future?
Mr. Newton: I agree with my hon. Friend's concluding remaks and I am grateful to him for what he said at the outset of his question. The point that he made in the middle of his question echoed the remarks of an Opposition Member in an earlier question. I hope that Opposition Members and my hon. Friends will not exaggerate the effects of what I have had to announce today on other firms throughout the country. The work that is now going on at NESL will be sufficient in a few weeks to employ only about 100 to 150 people. It follows from that that many of the effects on other suppliers throughout the country will have been felt already.
Ms. Joyce Quin: Is the Minister aware that only this morning it was confirmed to me by the responsible official in the European Commission that the Government never reached the stage of making a final and formal presentation in support of any of the bids to keep the yards open, or in support of any rescue plan for them? Given that fact, is it not the case that the Government have failed to explore every avenue to keep the yards open, and have failed signally in the EEC to stand up for British merchant shipbuilding?
Mr. Newton: No, it is not. It would be necessary to obtain the agreement of the European Commission, under the sixth directive, to any proposal, but the first essential is to have a proposal to put to it that we believe provides a viable future for the yards. We have no such proposal, and that is what I have had to tell the House today.
Mr. Barry Field: It is not true that Conservative Members do not understand the import of my right hon. Friend's statement. When Samuel White yard shut in Cowes, 5,000 jobs went down the road. We on the Government Benches understand these matters. I understand that yesterday, despite the high level of unemployment in my constituency, at least one of the yards within it was endeavouring to recruit shipbuilding skills in the north-east. Will my right hon. Friend liaise with the Department of Employment to set up a temporary special unit to identify the shipbuilding shortage skills in yards with heavy order books and put them in touch with the men in Sunderland?
Mr. Newton: As part of the arrangements that I announced in my statement, we shall explore any means of finding alternative employment, whether in shipbuilding or in any other industries, for those who, unhappily, will become redundant at Sunderland.
Mr. Frank Doran: It will be small comfort for workers and others in Sunderland, who will be devastated by today's news, but I am pleased to say that Hall Russell of Aberdeen received a lifeline today in the form of a short-term agreement between the yard's receiver and the Overseas Development Administration. I say to the Minister and to Conservative Members such as the hon. Member for Torridge and Devon, West (Miss Nicholson), who welcome the prospect of privatisation of
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the yards in their constituencies, that the history of the Hall Russell yard since privatisation has been one of lurching from crisis to crisis.
The yard has a history that goes back 125 years, the last 20 of which showed substantial profitability. It is believed in Aberdeen that the Government wish to wash their hands of shipbuilding. Will the Minister tell us which of our indigenous industries are safe and will obtain Government support? It is difficult to believe that any industry will receive support from the so-called Department of enterprise.
Mr. Newton: I note the hon. Gentleman's remarks about the latest news at Hall Russell. I share his pleasure at what he has reported. The rest of his remarks bore little relation to reality. The Government have made huge subsidies available to the shipbuilding industry and have maintained the position in which help is available under the intervention fund within the terms currently agreed. There is no suggestion that that help should be withdrawn. We want to see industries and firms, whether old or new, that can provide secure employment. That is what my statement is directed towards.
Mr. James Cran: Does my right hon. Friend agree that his decision and the results of it will be ameliorated by the package of measures which he has announced, on which I congratulate him, and by the existence of the Northern Development Company, which is the job-attracting agency for the north of England? If Opposition Members examine the facts, they will find that the company is funded to greater extent than most of the other job-attracting agencies in the other regions of the United Kingdom. They will find also that it has been immensely successful in attracting jobs to the north of England. I want to hear my right hon. Friend say that its work will continue after the closure.
Mr. Newton: Yes. I met representatives of the Northern Development Company when I was in Newcastle last week. I discussed some of these matters with them and assured them that the Government would continue to be as helpful as they could be in respect of their activities. From what they said, I doubt whether they will share the overstated pessimism that has been expressed in some questions today. They know how much success has been achieved in attracting new jobs to the north-east in recent years and months. With their efforts, and those of others to which I have referred, I believe that there is no reason, in the longer run, for the pessimism that some Opposition Members have expressed.
Mr. Frank Cook: I should be able to accept the Minister's protestations of concern and anxiety if I could see more than one of the eight Tory Members who represent north-east constituencies in their places ready to question him on his statement. I know what happens to a community when a shipyard closes. I was living in Hartlepool—it is my home town—when the Sir William Gray yard closed. The effect of that closure was drastic, but the platers, welders, burners, boilersmiths, shipwrights, electricians and fitters were able to go to the Tees. They went to Furness and Smith's dock. Since then, Furness has closed. We are awash with shipyard trades in that area. Following that, Smith's dock closed. Those closures were followed by others. Where will all the trades go? It is no good the hon. Member for Isle of Wight (Mr.

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Field) telling us that someone from the Isle of Wight is trying to recruit among the trades that are represented at Sunderland. Where will the 2,000 men go? It is no good giving us promises. Give us reality.
Mr. Newton: I hope that the hon. Gentleman will refer back to what I said in my statement about the efforts that will be made to seek alternative employment where that is available and, perhaps more to the point, to offer retraining and training to assist those with particular skills to acquire new skills if their existing skills are not wanted in the future. We are aware of their considerable abilities. No one would pretend—I would not pretend to the hon. Gentleman—that the closure of the yards presents other than a significant problem. That is not to say, as he rather implied in his question, that pretending that the problem is not there is an answer in the longer run for the men who are involved. As I have said, our aim is to provide them with good and secure employment for the future.
Mr. Kenneth Hind: Does my right hon. Friend agree that this is clearly a sad day? Will he accept that many of his hon. Friends believe that no one could have tried as hard as he has to restore the yard? My right hon. Friend will no doubt agree that Conservative Members such as myself have faced similar problems to those that are now being experienced by Sunderland Members. Under the Labour Government, Dunlop, Thorn EMI and Courtauld closed in Skelmersdale, with the loss of over 7,000 jobs. We have now recovered, and as a consequence of guidelines similar to those that he is offering Sunderland, there is not an empty factory in Skelmersdale. The town is booming.
Mr. Newton: Yes. It has been an inescapable fact for many Members on both sides of the House that the decline of some older industries has presented comparable problems in many other parts of the country. The experience of many places, some of which have been mentioned this afternoon, is that of the creation of new jobs and an entirely different feeling after a relatively short time from what was understandably felt at the time when the change occurred.
Mr. Jim Cousins: Will the Minister accept that what will cause continuing controversy after his statement is the fact that alternative bids which people, industry, capital and labour in the north worked hard to put together were available? It is simply not true for the Minister to say that there were no alternatives. The north has produced alternative bids for running these yards. It is the Minister's judgment of those bids that has caused the closure. Will he tell us whether the interest rate rises caused by the Chancellor of the Exchequer over the past six months have proved to be a fatal extra element in the evaluation of those bids? Will he also tell us whether the public expenditure costs of those bids were greater, or smaller, than the £45 million of public expenditure for enterprise zones and the other proposals that he has announced this afternoon?
Mr. Newton: The question whether the cost of any particular proposition is greater or smaller than £45 million does not arise in circumstances in which we did not judge that any of the bids would provide a viable future for the yards.
I have no reason to suppose that the factors that the hon. Gentleman mentioned were a significant factor in
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what has happened—and it is not merely a question of my judgment. I considered the advice that was given by British Shipbuilders, on the basis of independent financial advice that it had received, and it seemed clear that the proposals that had been put forward were not sufficiently strong financially to provide a secure future for NESL. There was even some doubt about where the money that was to be paid for the yards was to be found.
Mr. Peter Thurnham: There is a long tradition of shipbuilding on the Wear. Will my right hon. Friend confirm that, if there is any prospect of its profitable continuation, there is nothing to stop a new enterprise being formed to bid for the £48 million of maintenance which he has just announced? Should the people of the north-east not take heart from the outstanding achievements of British Steel in Cleveland, which was the winner yesterday of the Institution of Mechanical Engineers Willis Faber prize for manufacturing efficiency?
Mr. Newton: In general, the turnaround in many of the areas that have been affected in previous years by substantial steel closures is certainly an encouragement to those who, understandably, will feel depressed by today's announcement.
Mr. Bill Michie: May I first express my sympathy to the workers in Sunderland? I say that because I spent my working life in Sheffield in steel and engineering and saw the trauma and misery created by the demise of the steel industry there. I listened to the Minister this afternoon saying that other enterprises will come forward, other investments will take place and people will be retrained. We had skills in Sheffield and Sunderland. We shall finish up with opportunities to man turnstiles at football stadiums and to sell ice cream in the summer. The young, who should have had skilled jobs, will operate in Macdonald's, selling hamburgers. How can the Government justify the youth training scheme on the grounds that there is a shortage of skills, when the skills are there now in Sunderland? The will is there and the power is there, but the problem is that the Government do not have the guts to fight international pressure.
Mr. Newton: I do not believe that the hon. Gentleman would have put his question in that way if he had recently been to the north-east, seen the new factories going up, spoken to the people who are undergoing training for the new jobs and talked to those in the Northern Development Company or the urban development corporations, or to those who are concerned with the Newcastle initiative. They can see the effects of their efforts on the ground.
Ms. Hilary Armstrong: Many of us have personal knowledge of the skills, the development of those skills, the learning of those skills and the practice of those skills by many workers in the yards. The town of Consett is in my constituency, and it suffered a similarly devastating blow. The Minister knows that the jobs that have been created in Consett—welcome though they are—have not replaced or redeveloped a skill base, and have therefore not given the town and its surrounding area the confidence that there is skilled and productive work for the next generation. That is what the people of the north-east want and what the people of the north-east deserve. They have given their all to build this country. [Interruption.] The hon. Member for Stockton, South

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(Mr. Devlin) may not think that they have given their all, but I know that they have and that they have the work and the skills to be proud of. What will the Government do to ensure that we receive such development? Throwing money is not enough. Proper planning and development and Government orders to that region are needed.
Mr. NewtonThe hon. Lady is obviously right to say that the mix of jobs that comes in the wake of changes of this kind, and the mix of skills that they require, will not be precisely the same as those of the jobs that they have replaced. That is an inescapable part of the process of change. I do not believe that the general point that she sought to make stands up against the background of experience of the north-east in attracting new industries, such as motor cars, electronics and many others. They may not be the old skills of shipbuilding, for example, but they are the skills and products that will be in demand in the future.
Mr. Elliot Morley: Whatever new industries may be attracted, the closure of the Sunderland yard strikes at the very bedrock of our manufacturing industry and the impact goes much further than Sunderland. Towns such as mine that have steel plate mills will be affected. Now that the steel industry has been privatised, the Government appear to have washed their hands of its future role but what surprises me is that the Government can write off billions of pounds in privatisation programmes—£5 billion for British Steel alone—yet cannot find the money to protect the jobs in the important industry of shipbuilding in Sunderland.
Mr. Newton: Perhaps it tells one something about some of the economic difficulties that this country experienced, especially during the 1970s, that the hon. Gentleman can describe as the bedrock of the economy, of this or any other area, an undertaking that has persistently lost money, to the extent of hundreds of millions of pounds overall, and £100 million at NESL alone, in a short time. That is no basis for employment in an area.
Mr. Roland Boyes: Will the Minister accept that his disgraceful statement today is a devastating blow to Sunderland? Conservative Members have demonstrated that the Government simply do not care. Several Conservative Members have made me angry by talking about it being a sad day for Sunderland. For between 2,000 and 5,000 workers, it may be a sad lifetime. Many of them will never work again.
The Minister said that a number of jobs would be created. I ask him to investigate that. Every pit in my constituency has been closed—two quite recently. How many jobs have been created in the Houghton end of my constituency by British Coal Enterprise Ltd. to absorb the jobs of people who have been made redundant and who are on the dole queue? Has the Minister any idea of the magnitude of youth unemployment in the borough of Sunderland? Month after month, 6,000 or more youngsters have no proper jobs and the three unemployment offices have had between 40 and 50 vacancies. What will happen to children in Sunderland? Where will they obtain jobs when another 2,000 jobs have been taken away?
I never expected to hear the Minister's statement today. I wrote him a letter about the matter recently. I pay tribute to my hon. Friends who have shipyards in their constituencies for their efforts in trying to retain them. They have swallowed a lot in accepting some form of privatisation, yet the Minister declares the death of the yards in Sunderland. That is unacceptable, and the Minister should be ashamed of himself.
Mr. Newton: The main thrust of the hon. Gentleman's question was about the prospect of future jobs. The best thing that I can do is to repeat that the Nissan investment alone has already created well over 1,000 jobs, with nearly 2,000 more expected during the next few years, which is roughly the number of people employed in NESL, excluding Sunderland Forge Services. I do not suggest that there is a neat equation for the people involved, but it is a good illustration of the scope for new jobs and it is only one example of the current growth in the north-east.

North East Shipbuilders Ltd.
4.30 pm
Mr. Bob Clay: I beg to ask leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the decision by the Government announced today to close North East Shipbuilders Ltd."
The matter is obviously specific in the light of the Minister's statement. It is urgent because, unless the House can call the Government to account within the next few hours, the orders that could come to that yard will no longer be available. The statement should not be allowed to stand. We must also try to stop the devastating demoralisation that is already flowing rapidly through the area that I and other hon. Members represent.
The House should examine carefully some of the statements made by the Minister. It is not true that the recent bids for privatisation were properly examined. I know from personal experience that one bidder was refused meetings with the Minister's financial advisers and accountants, despite the fact that for weeks previously the other bidders had plenty of opportunity to discuss the matter and plenty of information. How can he say that there was a serious assessment?
How can the Minister say that none of the bids would have been acceptable to the European Community when the Government never put a formal proposal to the EC? The House should debate the matter in detail. If, as the Minister says, the EC would have closed the yard, the Government should have told the EC that they were not prepared to close it.
Many specific matters about the conduct of this case should he discussed. For example, advice given in good faith by a civil servant to a bidder turned out to be wrong, but it was too late for the bidder seriously to revise his proposal. This afternoon the Minister rubbished British Shipbuilders and said that it was incapable of running the
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yard any longer, yet he relied on its judgment—rightly or wrongly—to assess whether the yard should stay open. It is nonsense.
This is a wicked decision that should he debated by the House immediately. We should not allow the Government to run away from the decision that they have made. They should be called to account, and we should be able to debate the shambles and the tragedy that they have perpetrated this afternoon.
Mr. Speaker: The hon. Gentleman asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he believes should have urgent consideration, namely,
"the decision by the Government announced today to close North East Shipbuilders Ltd."
I have listened with concern to what the hon. Gentleman said and to the exchanges in the House this afternoon, but, as he knows, the Standing Order prevents me from giving reasons to the House. I regret that his application does not meet the criteria laid down under Standing Order No. 20 and I cannot, therefore, submit his application to the House.
Mr. Alan Williams: On a point of order, Mr. Speaker. Of course, I do not challenge your ruling, but you will have heard the depth of feeling about this catastrophe for the people of the north-east. As the Leader of the House is present, and as this is a Government decision, may I prevail upon you to ask him to allow time early next week for us to have a full debate? Perhaps he can make a proper statement announcing the time of that debate in tomorrow's business statement.
The Lord President of the Council and Leader of the House of Commons (Mr. John Wakeham): Further to that point of order, Mr. Speaker. I recognise the importance of the issue and the strength of feeling. I undertake to have discussions, through the usual channels, to see whether we can find a way of proceeding that will be satisfactory to hon. Members on both sides of the House.

SS Mediterran Frigo
4.33 pm
Mr. Paul Flynn: I beg to ask leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the decision of the authorities to allow the vessel SS Mediterran Frigo to leave Newport docks following a drugs raid."
The matter is urgent because that vessel is now on the high seas, without a customs officer on board, after only one of its three holds was searched. About 48 hours ago, a quantity of drugs with a street value of £2 million was discovered on board the vessel. It is the third time that drugs have been discovered in Newport docks without a single arrest having been made.
The matter is specific because customs officers are inhibited by present laws from seizing any vessel with a weight of more than 250 tonnes and from conducting thorough investigations because they are liable to pay compensation for perishable cargoes that deteriorate. That ship has a cargo of bananas, which will deteriorate rapidly.
The matter is important because of the terrible damage done to many lives by those who traffic in drugs. By allowing customs officers to be inhibited in this way, we have created a position whereby the ship is heading for a port in Belgium, from which there is great difficulty in extraditing suspected offenders—we have had recent experience of that—and which is soft on drug traffickers, with a maximum sentence of two years for such an offence. Are we not encouraging drug trafficking by encouraging people to use big ships carrying perishable cargos heading for ports in Belgium and Holland?
In the Gracious Speech the Government said that they would
"continue the fight against international terrorism and against trafficking in drugs."
By allowing that vessel to leave swiftly after such a brief investigation in Newport, are we not creating a charter for drug traffickers?
Mr. Speaker: The hon. Gentleman asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he believes should have urgent consideration, namely,
"The decision of the authorities to allow the vessel SS Mediterran Frigo to leave Newport docks following a drugs raid."
I listened with great concern to what the hon. Gentleman said about this matter, but I do not consider that it is appropriate for discussion under Standing Order No. 20 and I cannot, therefore, submit his application to the House.

Ministerial Statements
4.36 pm
Mr. Tim Devlin: On a point of order, Mr. Speaker. The statement that we have just heard was timed for 3.30, and at exactly the same time the Government announced, at a press conference across the road in the Department of Health, the results of the inspection of Cleveland social services department. Members from the north such as myself and my hon. Friend the Member for Langbaurgh (Mr. Holt) would
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have liked to be present for both. Will you use your good offices to ask the Government not to put on important business relating to the north-east in two locations at the same time? If they do, Opposition Members will be able to raise spurious points about our absence in the House.
Mr. Speaker: I have considerable sympathy with what the hon. Gentleman has said, but it is no part of my responsibility to dictate to the Government whether they should have made two statements or one statement, or what they should do outside the House. I am sorry that I cannot help the hon. Gentleman.
Later—
Mr. Frank Cook: On a point of order, Mr. Speaker. You will already be aware that there was a press conference at 3.30 pm this afternoon relating to the social services inspectorate's report of the arrangements in Cleveland concerning child abuse. I am a Member of Parliament representing Cleveland constituents, yet I was informed of that press conference only at 26 minutes past three today, when I was planning to be in the Chamber for the bright and breezy announcement concerning North-East Shipbuilders. As the custodian of the proceedings of the House, are you not of the opinion that such matters should be brought to the House rather than be announced at press conferences, of which relevant Members are informed only four minutes before they begin?
Mr. Speaker: If I were drawn into giving my opinion on such issues I should be in serious trouble. I am not responsible for matters of that kind.

Civil Servant (Letter)
4.37 pm
Mr. David Winnick: On a point of order, Mr. Speaker. May I ask your guidance on a matter of public interest. The background to the matter is the letter that appeared in The Guardian today from an official in the information department of the Foreign and Commonwealth Office. I understand that that official has been suspended. As this is undoubtedly a matter of public interest, what steps can be taken to get the Prime Minister or the Foreign Secretary to answer the serious valid allegations made in that letter? Now that the official has been suspended, we should have a statement as soon as possible from the Prime Minister or the Foreign Secretary.
Mr. Speaker: That may be, but I cannot give the hon. Gentleman tactical advice on how to approach these matters. He knows the form himself.
Mr. Tam Dalyell: Further to that point of order, Mr. Speaker. Is it entirely a question of tactical advice? Is it not more that the House of Commons should be treated properly? It is most extraordinary for a senior official—we have looked him up in the Foreign Office list and he seems to be a second secretary—to write such a letter, giving not a private address but the address of the Foreign Office information department. In the circumstances, should not the House of Commons at least be told the background before other people rush to judgment? There is also an element of urgency about this case, so why should the House wait and wait?
Mr. Speaker: It may be a matter of great public interest, but it is not a matter of order for me. I feel sure that the hon. Gentleman's comments have been heard by the Leader of the House.
Mr. Dennis Skinner: Further to that point of order, Mr. Speaker. There is another way of examining the matter. At the weekend, the press were informed of the junior Health Minister's views about eggs and salmonella poisoning. As a result, at the earliest possible opportunity on Monday the Secretary of State for Health had to come to the Dispatch Box to explain away his junior Minister's comments.
That matter may or may not be as important as the issue that has been raised in The Guardian today. It is true that the official concerned is not an elected Member of the House and that he is not a junior Minister. One thing is certain—he never will be now. Nevertheless, the fact remains that he is a servant of the state, working in a Government Department, and has said something of great importance regarding the Prime Minister's conduct. If it is right that a Secretary of State must be trotted out every time his junior Minister opens her gob, is it not right that a Minister should explain to the House why it is that a senior official of his Department has said important things about the way in which the Government are running their business?
Mr. Speaker: It is, as I have said, a matter of considerable interest but not a matter of order for me.
Mr. Alan Williams: Further to that point of order, Mr. Speaker. You, Mr. Speaker, may not have a copy of the letter published in The Guardian, but it comes from the Ministry's information department. The Minister is responsible to the House for the activities not only of junior Ministers but the whole of his Department. When a Ministry's information department issues a statement as unusual and as important as the one in question, the Minister concerned surely has a duty to the House to explain it.
Mr. Speaker: That may be so, but it is a matter for the Leader of the House and the Government, not for the Chair.
Mr. Bob Cryer: Further to that point of order, Mr. Speaker. On one last point—
Mr. Speaker: Order. No, not one last point.
Mr. Dalyell rose—
Mr. Speaker: Order. No. About 50 right hon. and hon. Members wish to take part in today's Second Reading debate, and I shall have to place a limit on the length of speeches. The hon. Member for Bradford, South (Mr. Cryer) has not put down his name for that debate, although he may hope to catch my eye, and he is therefore taking time away from his right hon. and hon. Friends. However, I shall hear his point of order if it is important and if it is a matter for me.
Mr. Cryer: You, Mr. Speaker, urged the Leader of the House to make a statement on the matter. The Leader of the House is present and could do so immediately.
Mr. Speaker: I certainly did not urge the Leader of the House to make a statement. I said that the Leader of the House will have heard what had been said.

Orders of the Day

  Water Bill
  Order for Second Reading read.
  Mr. Speaker: I repeat that about 50 right hon. and hon. Members have asked to take part in this debate. I propose limiting speeches made between 7 and 9 o'clock to about 10 minutes, but I hope that right hon. and hon. Members called before 7 o'clock will also have regard to that time limit.
  4.44 pm
  The Secretary of State for the Environment (Mr. Nicholas Ridley): I beg to move, That the Bill be read a Second time.
  The main purposes of the Bill are to establish a National Rivers Authority responsible for the control of water pollution, water resource management, flood defence, fisheries and navigation; to provide a new statutory framework for setting river quality objectives and other standards, and set out effective means of enforcing these standards; to transfer the utility functions of the water authorities to new limited companies, and to provide for the terms of their appointment, and for the sale of shares to the public towards the end of 1989; to provide for the appointment of the 29 statutory water companies to continue supplying water in their existing areas, and to allow them to convert to plc status if, with the support of their shareholders, they so choose; to provide a clear legal framework for the duties, functions and powers of appointed companies, updating and amending water and sewerage law; and to provide for the appointment of a director general of water services to keep the provision of water and sewerage services under review, and to protect the interests of customers.
  The Bill applies to England and Wales. It is the Government's intention to introduce on Report a limited number of amendments relating to drinking water and the protection of the water environment in Scotland. The Scottish Office has consulted on those proposals. They will not change existing arrangements for the ownership and regulation of water supplies in Scotland.
  Preparing for privatisation of the water industry convinced us that we needed the National Rivers Authority. There is a distinction between the utility services of the water authorities—trading activities that can be better managed in the private sector—and the need to regulate in the public interest. Regulation should not be done by those who have a financial interest in the matters to be regulated. As the Select Committee on the Environment said,
  "Gamekeepers should not be poachers as well."
  It has been a glaring defect hitherto that water authorities combine the regulatory and utility functions. Those responsible for the treatment and disposal of sewage effluent should not also have the task of regulating pollution and prosecuting their own customers. This major advance puts right an inherent weakness in current arrangements. In this case, public ownership has disguised the truth and failed to protect the public interest. It is another nail in the coffin of that flawed ideology of the Labour party.

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  There has been general welcome for our proposals for the NRA, and I will say a few words about its powers and role as set out in the Bill. The water authorities have been drawing up schemes of organisation for the regional bodies which will, with the passage of the Bill, become part of the NRA. They are well on course to set up those bodies by 1 April 1989. I congratulate the water authorities on the work that has gone into those schemes of organisation, and I am grateful for the expert advice and assessment contributed by the NRA advisory committee, under the chairmanship of my noble friend Lord Crickhowell.
  The NRA will be a strong and effective body, comprehensively equipped to regulate all discharges to rivers, estuaries and coastal seas up to three miles out. The Bill provides a statutory framework for water quality objectives. The NRA will advise on statutory quality objectives that I, as Secretary of State, will set. The authority will monitor and enforce them. It will be able to grant or refuse effluent discharge consents. It will be able to set up water protection zones to protect water sources in designated areas from pollution by such substances as nitrates and pesticides. It will have powers to prevent and remedy pollution. On the "polluter pays" principle, it will be able to charge for discharge consents and to recover the costs of dealing with pollution incidents.
  That regime of improved standards, which the NRA will supervise, will be transparent and public. I shall be accountable to the House and to Parliament as a whole for the standards set for the authority to achieve. For the first time, the public will have a clear measure of what those standards are.
  The NRA is widely acknowledged as a major advance. Even the Opposition grudgingly support it. It is a product of our move towards privatisation. It comes as no surprise when the opponents of the Bill turn round and say: "In that case, since you've got the NRA, why privatise the water and sewerage undertakers?" I shall give the House four good, detailed reasons why that is the right thing to do.
  First, private ownership has long been a feature of the water industry. The statutory water companies have been in existence for a long time. There are 29 of them, responsible for one quarter of our water supply. They are privately owned. There have been few complaints about them. If the private supply of a public utility is anathema to the Labour party, why did it not take the opportunity to nationalise it during its periods in office? I assure the hon. Member for Copeland (Dr. Cunningham) that it will not have another opportunity.
  Dr. John Cunningham: That is such a boring old canard that it is barely worth a response. The Secretary of State gave the game away in his opening comments when he described them as "statutory water companies". He knows that they are not private enterprises. They simple act as agents for the regional water authorities and their activities are heavily circumscribed in law. That is why we did not nationalise them.
  Mr. Ridley: The hon. Gentleman is stretching logic too far. They are owned by private shareholders. The capital is supplied by the private sector. They are statutorily limited to the geographical areas in which they operate and
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  they are statutorily controlled as to their dividends and the amount that they can put to reserve. In every other respect, they are totally analogous with private sector companies. They have been privately owned for a long time, so that is not much of a point.
  Mr. Tim Devlin: In view of the objects of the Bill, if at the end of the process we create a number of privately owned water companies which are statutorily defined, will that not be acceptable to the Opposition?
  Mr. Ridley: I am sure that the hon. Member for Copeland (Dr. Cunningham) would have risen to say no if he had wanted to deny my hon. Friend's sensible proposition.
  The Bill provides a procedure for statutory companies wishing to convert to plc status.
  Mrs. Ann Taylor: They are not ordinary private companies.
  Mr. Ridley: The hon. Lady is wrong. Whether they are private companies or plcs is a separate matter.
  Economic regulation based on price control, rather than dividend limits, will provide them with a stronger incentive for efficiency and a stronger basis for comparative competition. However, the statutory water companies have performed their functions in private ownership without it even being an issue hitherto.
  The Government will announce later their decisions about any special shares which may be required in the water industry. However, the conditions which enable competition in management to take place must not also allow undue concentration. It is vital that people should feel that they have a local water company, with those running it living and working locally. It is also vital to maintain yardstick comparisons. If the regulator is to know the scope for efficiency improvements and the possibilities for the best management to deliver exacting environmental and water quality standards at a lower price, there must be an adequate number of independently owned and managed companies to afford a range of comparisons. That is what comparative competition means.
  The water plcs will be directly comparable with each other in the services that they provide. Shareholders, financial markets, commentators, the director general of water services and the customer will be able to make comparisons between each of the companies. Privatisation will clarify the costs that each company faces in order to meet its measured objectives.
  Mr. Bob Cryer: What about the French?
  Mr. Ridley: From those comparisons, it will be possible to judge performance and for the regulator to get his price control more accurate. Therefore, I shall later be bringing forward proposals, in conjunction with my noble Friend the Secretary of State for Trade and Industry, to ensure that our arrangements take full account of the need to preserve comparative competition.
  The third reason for privatising the water authorities is to give them scope for innovation and diversification. That is exemplified by the French water companies, which the hon. Member for Bradford, South (Mr. Cryer) just mentioned and which seem to cause such alarm to Labour

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  Members. Why do the French want to buy our water companies? Perhaps they have been successful worldwide because they have practical experience of water supply in the private sector and have successfully diversified from that base.
  Perhaps there is a lesson for the future of our water companies in that the strengths and diversity of the privately owned French companies has enabled them to dominate the world market. Some have an annual turnover as great as £5 billion. In addition to water supply and water treatment, they compete successfully, among other things, in markets for municipal services, housing, communications, construction, manufacture and cable television.
  Our nationalised water authorities have not been able to develop their expertise and experience in the same way. We have missed out on that world market hitherto. No Government have ever allowed—or could allow—nationalised industries such freedoms. By providing a home base which encourages enterprise, diversity and initiative, I believe that we have the opportunity to create companies which can even outdo the French in capturing the world market in water supply.
  Mr. Richard Livsey: The Secretary of State is making great play of the position of French water companies. Is he aware that there is huge variation in water prices throughout France? In Dax in south-west France water costs FF2·90 per cu m, in Paris it is FF5 per cu m, and in Angers it is FF10·50. Surely such an intolerable situation should not be used as an example. Does he feel that those disparities could occur in Britain with the plcs?
  Mr. Ridley: I am afraid that I cannot confirm the hon. Gentleman's prices. He obviously has more opportunity to check out such matters on the ground. I cannot answer for the French system of price regulation, but what I am proposing to the House is a system of price regulation which will ensure that the prices in each area reflect the economics of supply and the need for investment in improvements. Therefore, privatisation will, for the first time, give an incentive to innovation and efficiency and a new freedom to allow companies to follow the industrial logic of their own development both vertically and horizontally and to compete overseas.
  Dr. Cunningham: Is the Secretary of State happy about the depths of the penetration of French water industry companies into the British water industry in view of his hopes for the future? Is it true, as has been reported in the newspapers, that Mr. Patrick Brown of the Department of the Environment has been hinting in the City and elsewhere that further penetration by French water interests is unacceptable? If that is so, on what legal authority have such indications been based?
  Mr. Ridley: That is not so.
  I shall now give the fourth reason why privatisation must be right. If we are to enable our companies to innovate and diversify, they must have access to capital markets for the capital investment needed. Until this Government took office, nationalisation had constantly restricted and restrained that. Between 1974 and 1979, when the Labour Government gave up control of the economy to the International Monetary Fund, the water authorities suffered an overall reduction in capital
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  spending of one third in real terms. Within that total, the Labour Government halved expenditure on sewerage and sewage treatment. Since then, we have conducted a considerable catching up exercise. Investment has increased by more than 50 per cent. in real terms since 1980. We have doubled the programme in cash terms to £1·2 billion this year, and will increase it to £1·43 billion next year.
  The dirty man of Europe is indeed sitting on the Opposition Front Bench. To some extent, I exonerate Opposition Members. It was not deliberate—it was not because they meant to, as the hon. Member for Bootle (Mr. Roberts) admitted a few weeks ago—but because their financial incompetence prevented them from achieving even that basic water cleanliness that we all seek. The proof that public ownership cannot generate the necessary capital investment to protect the environment has been supplied in ample measure by the Labour party.
  Dr. Cunningham: In view of his extraordinary claims about expenditure, how does the Secretary of State explain the fact that in 1977–78, the last full year of the Labour Government, total capital expenditure by English and Welsh water authorities was £1,064 million? On the public works deflater, a decade later—after 10 years of the present Government—it was £1,187 million, a slight increase, but in each of the intervening eight years the figure was lower than it was in the year when Labour left office. The right hon. Gentleman has got his figures very wrong.
  Mr. Ridley: If the hon. Gentleman wants somebody to arbitrate between us about figures, I suggest that it be the hon. Member for Bootle, who was a member of the Select Committee on the Environment which published the figures in its report and showed quite clearly —[Interruption.] My hon. Friend the Member for Hornsey and Wood Green (Sir H. Rossi) has a copy. If the hon. Gentleman disputes the figures, I inform him that I am only quoting them.
  Sir Hugh Rossi: As attention has been drawn to the Select Committee's report—
  Dr. Cunningham: I did not mention the Select Committee's report.
  Sir Hugh Rossi: My right hon. Friend did. It might be awkward for the hon. Gentleman to be referred to ii, but the peak year on the chart is 1970. Until then, the decline occurred during the hon. Gentleman's term in office, and the figure did not begin to climb until 1980.
  Mr. Ridley: Perhaps it would be a help if we were to have visual aids in the Chamber. Opposition Members clearly do not understand figures, and they cannot read them.
  Mr. Peter L. Pike: If the Secretary of State reads the chart in the Select Committee report, he will recognise that, although the figure dropped during the period stated, it is still only two thirds of the peak figure of 1974. After nine years of Tory Government, that is appalling.
  Mr. Ridley: That is not correct. It is an interesting admission that the two periods of highest water investment

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  in the hon. Gentleman's history are 1974 and 1988—both under Tory Governments. That rather bears out what I said.
  Mr. A. E. P. Duffy: Will the Minister give way on that point?
  Mr. Ridley: Although Mr. Speaker appealed for brevity, I shall give way to the hon. Gentleman, but then I must make progress.
  Mr. Duffy: If we may refer to water authorities such as the Yorkshire water authority, does the Secretary of State recall that in recent years his Department squeezed the borrowing rules for water authorities to such an extent that, although investment has taken place as he has stated, it has had to be borne by water charges? The chairman of the Yorkshire water authority is recorded as saying in recent weeks that even before privatisation he may have to consider a water charge increase of 27 per cent. next year, which is three and a half times the present level.
  Mr. Ridley: If the hon. Gentleman believes that there has been a shortage of capital, I am sure that he will join the Government in the Lobby tomorrow night to support the privatisation of authorities so that they can get access to capital markets.
  The forward financial planning of the privatised industry will not be affected by any future Labour Government having to make their usual cuts, or bound by the yearly limits of public expenditure planning. The industry will have free access to capital markets, to raise the finance that is essential to investment in higher standards, to diversify, or to compete overseas. The investment programmes will indeed be large. They will start from a raised base, the 20 per cent. increase in investment in the water industry next year, which brings it to £1·43 billion, which was announced in the autumn statement. The privatised industry will have to sustain and increase those levels of investment.
  To demonstrate the scale of the environmental improvements that we are planning, I will go through the investment plans for the three main clean-up programmes.
  First, water authorities are already planning accelerated capital programmes over the next four years. The programmes will bring almost all sewage treatment works into full compliance with their consent limits by March 1992. We should make the fastest practical progress to getting all treatment works to meet the standards for sewage effluent already laid down in United Kingdom law. At each plant which is prone to failure there will be a costed timetable leading to compliance. As the Government confirmed in response to a question from my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) earlier this afternoon, the total cost of those remedial programmes will be between £900 million and £1,000 million over the four years to March 1992.
  Secondly, the industry is also spending £70 million each year on improving bathing waters in areas where they do not come up to standard. About 400 bathing waters are within the scope of the European Community bathing water directive, and 60 per cent. of them already meet the quality standards on coliform bacteria. We are discussing with water authorities a substantial acceleration of that programme, targeted to bring the remainder up to scratch
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  by 1995. The estimated total cost is in excess of £1 billion over the seven years, which represents more than a doubling of the present rate of spend.
  Thirdly, the Bill provides a new and greatly strengthened legal framework for setting standards for drinking water quality. For the first time, exact and numerical standards for drinking water quality will be set down in United Kingdom law and approved by Parliament. Those standards will include all those in the European Community drinking water directive, including that for pesticides. All water undertakers will have a duty to comply with the standards and to undertake specific sampling and monitoring procedures. Standards apply to private as well as public supplies. In addition, there will be a new criminal offence of supplying drinking water unfit for human consumption, punishable by fines or imprisonment.
  As part of my powers to assess compliance with the standards, I shall be able to require information to be published. This will help to make the new companies more accountable. I will also appoint technical assessors to monitor drinking water quality. As in other areas, water authorities and water companies are preparing programmes of improvement where existing water supplies do not meet one or more of the exacting standards in the European Community drinking water directive. It will be one of the main tasks of my technical team to ensure that the programmes progress satisfactorily.
  All the programmes for improving water supplies will be agreed with the Government before privatisation. Investors will have to know, and will know, the extent of financial commitment involved, and the work that I have described will enable that to be spelled out. Our provisional estimate is that additional expenditure on drinking water quality over the next 15 years or so will be about £1·5 billion. That is on top of existing capital expenditure levels and plans on water supplies.
  The three clean-up programmes, taken together, come to £2·4 billion on top of existing plans. They are only an estimate of the extra funds necessary to achieve the three known requirements going beyond present plans. They can be only broad-brush estimates, and I give them merely to show the magnitude of the cost increases involved. Without prejudice to decisions yet to be taken on the RPI-related price control formula, increased capital expenditure of the order of £2·4 billion to the end of the century would indicate costs in real terms of 7·5 to 12x00B7;5 per cent. higher than they would otherwise have been. That shows how wide of the mark the hon. Gentleman is in talking of doubling or trebling water charges.
  The water companies will also be investing in other activities and diversifying, just as the French have done so successfully. There has been talk of price increases to meet taxation and pay dividends. Like any other private company, the water service will be subject to corporation tax and will be eligible for capital allowances. The effect of clause 88 is to enable the regional water businesses to benefit significantly from these allowances.
  As for dividends, the companies will face the normal choices whether to finance particular activities by borrowing, by increases in equity, from profits or from cash flows. How they decide to finance particular investment will affect their costs. But, as things are now, the water authorities, as well as paying interest on their borrowing, are required by annual orders to earn a rate of return on their assets, which is reflected in their current

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  charges. What will change when they become public limited companies is that they will substitute for these capital finance costs, the costs of remunerating equity and debt in a new capital structure.
  Mr. Andrew F. Bennett: There is a great deal of concern about clause 7 and the prospect of the water bodies charging for access to the countryside. It has been suggested that there may be charges for rock climbing and getting on to countryside that has open access. Does the Secretary of State expect much money to be raised from that? Can he set people's minds at rest that he does not envisage a new policy of charging for the recreational uses that are at present provided free?
  Mr. Ridley: I do not envisage any such policy, and the matter can be pursued to better advantage in Committee. For many years, water authorities have been asked to sell land and they are selling surplus land all the time. Any land which remains and which their successors want to sell will be subject to the strict planning controls which exist particularly in national parks and areas of outstanding natural beauty. We shall go into the question of access in great detail, but I see no reason why the water companies which retain land would want to change rights of access, nor why they should want to charge for right of access. They charge for many facilities, such as car parking, fishing and yachting.
  Mr. Devlin: Where there is a common law right of way over a piece of land, is it not right that that right of way should continue to exist whether or not ownership changes?
  Mr. Deputy Speaker (Mr. Harold Walker): Before the Secretary of State replies, I wish to point out that many right hon. and hon. Members wish to take part in the debate and, the frequency of interventions will have to be taken into account in determining who shall catch the eye of the Chair.
  Mr. Ridley: My hon. Friend is right. Where there is a right of way it is impossible to charge for access. Where there is not a right of way and it is technically a trespass, it is not possible to charge for access. Access can be charged only where facilities are provided specially.
  The water companies' core activities will be regulated. Regulators will be under a duty to ensure that they can finance their core functions, including a reasonable rate of return on capital. Their ability to pay a reasonable return will depend on their efficiency. The regulator will not ensure rewards for any inefficient company.
  There is much more work to be done before we can take a view on the initial price formula. I have spent some time on cost increases to show why the figures that the hon. Member for Copeland was parading are absolute rubbish. These increases are entirely due to environmental improvements which the Bill facilitates and are in no sense due to privatisation.
  The hon. Member for Dewsbury (Mrs. Taylor) seemed to be getting the wrong end of the stick again in her comments on the statutory water companies in the newspapers this morning. First, they are privately owned and, secondly, their prices are not controlled by the Government. Thirdly, their dividends and reserves are controlled by the Government and, fourthly, the Government have told them that they must stay with the present law and we intend to make no changes. The
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  improvements which this Bill brings will be that these privately owned companies are brought within the price control formula which they are not at present.
  Although the environmental improvements represent extra cost, they are good value for money for the customer. He will be compensated through the benefits of privatisation, the possible lower cost of finance and the greater efficiency which we expect private ownership to deliver.
  In addition, the customer will benefit from higher standards of service and improved safeguards in the delivery of those services. To ensure that customers can rely on the maintenance and improvement of service standards once the industry is privatised, the director general will monitor each company's overall performance against standard indicators of service. As a condition of their appointment companies will be required to set targets for at least three key performance indicators—water pressure, interruptions of supply and foul flooding.
  If the director general thinks that a company is not doing well enough, and cannot agree the necessary improvements, he will be able to ask the Secretary of State at the time to make regulations to specify mandatory performance requirements and a timetable for their achievement. That will ensure that investment is well directed to the localities and aspects of performance which most need attention, and that companies give value for the charges that customers pay. This is a good Bill for consumers, for future shareholders, for taxpayers. for workers in the industry; above all, it is a good Bill for the environment. I commend it to the House.
  5.17 pm
  Dr. John Cunningham: Water is our country's largest natural monopoly. It is the people's most fundamental resource on which their health and well-being depends. We in the Labour party believe that this natural resource and the water industry's assets should be publicly owned and controlled. They should be managed openly and efficiently in the public interest, and the management should be democratically accountable at regional and national levels. Unlike the Tories, we do not believe that an essential resource such as water should be managed and sold for private gain. For us public health and hygiene are not matters to be dealt with by market forces.
  We know that the overwhelming majority of British people share our values on these matters. That was confirmed as recently as last weekend when The Sunday Times recorded the results of a MORI poll, which showed that, by 5:1, people are opposed to the sale of their water to private ownership, with only 15 per cent. supporting Government policy. We know that Ministers take that information seriously, because they have just engaged MORI to advise them on public attitudes to water privatisation.
  Try as he may, the Secretary of State cannot disguise his real motive for this Bill. It is to prepare the nation's water resources for sale and to create circumstances in which water will be sold to every household in England and Wales for private profit. People will have no choice about from whom they must buy their water. Some 99 per cent. of all households will be connected to private monopoly suppliers. Some 94 per cent. of all households are connected to the present public sewerage system. There will be no competition.

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  The Bill sets out to create the most far-reaching private monopoly powers ever conceived by a Government. I make it clear that a Labour Government will not hesitate to eliminate private monopolies to ensure that essential fundamental services are controlled and managed in the national interest—balancing the powers among consumers, employers, Ministers and Parliament. That is the only way to ensure that national interests are served and developed and that consumers have a real voice, real powers and effective protection against natural monopolies.
  Mr. John Maples rose—
  Dr. Cunningham: I shall give way in a moment.
  The Secretary of State lamely excuses private monopoly powers under the Bill by saying that water supply and sewerage disposal will be subject to the disciplines of the private sector—comparative competition, I believe, is the euphemism for that.
  Everyone in the House knows that such disciplines in the private sector exist only where there is competition. They come from the working of market forces. However, under these proposals, there will be no market, no choice and no option. For consumers, no market forces will exist in the supply of domestic tap water or sewerage services. The Secretary of State's argument is built on a transparently false premise. His ridiculous answer to this is, "Let people buy Perrier," which is another sign of his failure to understand the reality of the lives and circumstances of millions of our fellow citizens. Indeed, we understand that Perrier is ideologically unsound in 10 Downing street.
  Mr. Maples: The hon. Gentleman said that it would be inappropriate for the water industry to be under private ownership. He started a paragraph with the phrase, "A future Labour Government would not hesitate", but then he waffled a bit. Is he saying that a future Labour Government would renationalise this industry and, if so, on what basis?
  Dr. Cunningham: I say, without any hesitation, that a Labour Government would not allow private monopolies in water to exist—and we shall take them into public ownership.
  Sir Anthony Grant: rose—
  Dr. Cunningham: No, I shall not give way.
  These proposals are a betrayal of the consumer and of every household in England and Wales.
  Sir Anthony Grant rose—
  Dr. Cunningham: I shall not give way.
  Under this Government, average domestic water bills have already increased by 150 per cent.
  Sir Anthony Grant: Will the hon. Gentleman give way?
  Dr. Cunningham: I have said no.
  That is according to the water industry's own publication, "Water facts".
  Mr. Ridley rose—
  Dr. Cunningham: I am dealing with the point made about prices by the hon. Member for Lewisham, West (Mr. Maples). I shall give way in a moment. I am reminding the hon. Gentleman that prices have already gone up by 150 per cent. as this Government fatten up water for privatisation.
  Even more revealing is the fact that, since the Government made the decision in principle to sell off the water resources, there has been a deliberate policy of increasing water charges well above the rate of inflation. Between 1983 and now, the index of water price charges has increased by more than 20 per cent. above the retail price index. The consumer, indeed, has already been made to pay for Tory dogma and will be forced to do so again.
  Mr. Ridley: I believe that I can stand proxy for my hon. Friend the Member for Cambridgeshire, South-West (Sir Anthony Grant), who was trying to ask the hon. Gentleman whether his recent pledge means that he will nationalise for the first time the statutory water companies which have always been in private ownership. Perhaps the hon. Gentleman could help my hon. Friend, as he did not have the courage to give way to him.
  Dr. Cunningham: As the Secretary of State well knows, it is unlikely that those private statutory water undertakings will even be in existence in a few years' time. It is likely that there will be seven or eight major conglomerates owning and controlling our water resources. Far from there being more competition, there will be even less than there is now—if that is possible.
  Sir Anthony Grant rose—
  Dr. Cunningham: No. I shall not give way.
  Prices will again rise sharply even before privatisation, as a major act of Government policy. We know this from a leaked letter from Ernst and Whinney, the accountants advising the water companies and the Department of the Environment. It was writen on 1 December, marked "Urgent—for immediate attention", and was addressed to the general managers of the water companies. It points out that tariff increases should be planned immediately to the maximum possible level. It says:
  "under the existing regulatory formula prior to the introduction of price cap control"—
  that is prior to that which the right hon. Gentleman proposes—
  "as envisaged by the draft licence. Companies should therefore ensure that the next tariff setting process takes full account of the consequences of future asset management plans and the costs of these, which we envisage may well mean each company raising its tariffs to the maximum permitted under the existing regulatory formula."
  On page 2 it goes on to say:
  "Companies are strongly advised not to suggest that privatisation as such makes these tariff increases necessary."
  That is what is happening in the right hon. Gentleman's Department. That is what he is trying to hide from the public about prices.
  Mr. Ridley rose—
  Dr. Cunningham: I shall give way in a moment.
  I read that from an authentic copy of the letter from the right hon. Gentleman's own advisers.
  Mr. Ridley: The hon. Gentleman does not understand. The private water companies are not allowed to increase their prices for any other purpose than investment. That letter is not a leak. It is from the water companies'

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  accountants and not mine. The water companies have been to my Department and they have been told that they are not allowed to increase their reserves or their dividends. That letter is asking them, therefore, to increase the prices by the maximum possible to finance the investment in environmental improvements. The hon. Gentleman is wrong again. Now he wants to nationalise them, and they will not be able to get the capital from the private sector.
  Dr. Cunningham: The right hon. Gentleman reminds me of a character in Chaucer's "The Canterbury Tales" the Fraudulent Alchemist.
  This letter says:
  "Following a meeting arranged by The Water Companies' Association today with the Department of the Environment".
  It is following the meeting that they are advised. The right hon. Gentleman is now suggesting that somehow all this has nothing to do with privatisation. Frankly, we do not believe him. The letter makes it clear that water charges must increase because the privatisation proposals demand it.
  The preferred method for charging consumers under the Government's proposals appears to be water metering. The full consequences for people involved in water metering trials were revealed to me this morning in a letter from a consumer—or perhaps I should say, a victim—of the proposals who is a resident of Brookmans park in Hertfordshire, which is a metering trial area. He said:
  "I am part of the water meter trials in the Lee Valley area. From next April my water will be metered on a two part tariff basis. Peak rates will occur at 7 am-10 am and 6 pm-9 pm, exactly the time when one uses water for personal hygiene…
  Lee Valley have admitted to me … that because people use less water when metered, they have already raised the charges between 10 and 15 per cent. They also admit that if people are very frugal with their water consumption, prices will be increased further to maintain an 'adequate' revenue.
  By next April I will be paying between 15 per cent.—20 per cent. more for my water and the overall water bill will probably increase by 25 per cent. All this before privatisation. What will the charges be after? Frankly I can only agree with you and say that it will be a 'huge rip-off."
  Presently, the industry makes negligible real profit. There is almost no scope to reduce operating costs. Water supply and sewage disposal offer only low growth prospects in most areas. The bulk of investment will not be revenue-earning. Privatisation will increase the buyers' indebtedness. Companies will be liable to corporation tax, top salaries will rocket, as will management costs and expenses. Shareholders demand dividends, but who foots the bill? The consumer, of course.
  Even water industry chairmen—it is significant that the Government have not appointed a single woman to one of those posts—admit to charges increasing in the range of 50 to 80 per cent. In view of all that has already happened and all the evidence, we stand by our claim that, if this squalid Bill proceeds, domestic water charges will, effectively, at least have doubled as a result of Government policies and almost certainly risen much higher than that.
  The Secretary of State has made another bogus claim by suggesting that the reason for past price increases has been the need, not contested by us, to increase investment in the water industry. But what does the record show? As I said in an intervention, if we compare 1977–78—the last full year of the Labour Government—with the expenditure for 1987–88 and using the water authorities' own figures and the GDP deflator on a 1987–88 price basis, we see that total capital expenditure by English and Welsh water authorities was £1·164 billion in 1978 and £1·187
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  billion in 1988. In every one of the intervening years, however, under this Government, investment was lower than in 1977–78. So much for the boastful record that the Secretary of State mentioned. If the comparison is done using the public works deflator as an alternative, the result is effectively the same.
  Huge conflicts of interest run right through the Bill. The positions of the Government's dogma and of private profit are elevated above the interests of the consumer and the environment. The National Consumer Council shares our view that the arrangements for the protection of consumers in the Bill are "inadequate".
  What of the interests of the taxpayer? The public water authorities are holders of massive assets of buildings and land. Often those public assets are in prime town and city centre sites. We, the people, own an estimated 500,000 acres of land, much of it in national parks and areas of special interest or outstanding natural beauty. Under this Bill, it is all to be sold. What is its cash value? No one knows. I shall come to the incalculable heritage and environmental values later.
  We are aware that the Secretary of State has appointed, at public expense, Schroder Wagg to quantify those public assets, yet he denies Parliament and the people that information. So much for his claim that he puts "evidence before emotion" when deciding policy.
  With the scandal of the Royal Ordnance losses to the taxpayer fresh in our minds, the House is asked to approve proposals to rip off the taxpayer yet again by approving the Bill in complete ignorance of the capital value of our own assets that are to be sold. We simply should not do so.
  Our water industry assets are many times greater than those involved in the Royal Ordnance sale, of which the Public Accounts Committee of this House said:
  "In any similar sales in the future, any feasible planning permissions likely to increase property values should be obtained before offers are invited."
  The Government intend to ignore that advice. Why? How does that decision fit with the Tory claims to protect the taxpayer? If fits like the glass slipper on the Ugly Sisters —it does not fit at all. Of course Ministers know that their defence of all this is simply a fairy story. They intend the public assets to be the prize to induce buyers in the first place.
  Asset-stripping—
  Mr. Ridley: Will I turn into a pumpkin?
  Dr. Cunningham: Wicked Uncle Ebenezer, more like.
  Asset-stripping will be the name of the game. It has been tacitly agreed, and it is inherent in the Bill. Small wonder that the French are falling over themselves to buy into British water along with other predators such as the apparently Australian Mr. Duncan Saville. He has been doing deals with Southern Water and we have discovered that his company, Associated Insurance Pension Fund, is registered, not in Australia, but in the Cook Islands in the Pacific.
  In some places asset-stripping is already taking place. The Countryside Commission, the Council for the Protection of Rural England, the Ramblers Association, the Royal Society for the Protection of Birds, the Royal Society of Chemistry, the National Anglers Council, the National Trust and dozens of other sporting and leisure organisations have all expressed their deep concern, if not open hostility, to the plans. They are rightly alarmed

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  Of the land held by North-West Water, 53 per cent. of it is in a national park or areas of outstanding natural beauty. Northumbria Water holds 37 per cent. of such land, Severn-Trent Water holds 64 per cent. of such land and 30 per cent. of South-West Water land is in a national park or an area of outstanding natural beauty.
  In many cases public access to water authority land has been extended beyond the legal rights of way. That has been achieved through the establishment of permissive paths or access agreements with local authorities. In the Peak District, for example, where 15 per cent. of the land is owned by water authorities, more than 40 miles of permissive paths have been created. In another area, owned by Severn-Trent, more than 50 miles of footpaths run through it, of which only one third are public rights of way.
  Mr. Frank Dobson: Bryngwyn.
  Dr. Cunningham: Yes, my hon. Friend is correct.
  Mr. Edward Leigh rose—
  Dr. Cunningham: I shall give way in a moment.
  After privatisation, the majority of the water authority estate will be transferred to the new private water companies, which may in turn transfer it to subsidiary companies with responsibilities for leisure and recreation or land development. Alternatively, land surplus to requirements may simply be sold of. Both possibilities could jeopardise the continuation of public access and conservation on water authority land.
  Mr. Leigh: In view of the hon. Gentleman's comments about the National Anglers Council expressing its concern about the Government's proposals, it is important to set the record straight. If that is true, why, in a brief to hon. Members, does that organisation say:
  "The National Anglers Council welcomes the proposals to establish a National Rivers Authority".
  Dr. Cunningham: Of course I accept what the hon. Gentleman says. It is true that that council says that, but it goes on to say that it is deeply concerned about access and asset-stripping opportunities in the Bill.
  Specific threats include the intensification of agriculture, afforestation, the establishment of inappropriate recreation developments, the curtailment of existing access provisions and the withdrawal of conservation management.
  The Secretary of State proposes the incredible and bizarre theory that to protect the Lake District we must sell it, to safeguard the Peak District we must "flog it off" and to enhance Dartmoor, we should hand it over to private enterprise.
  That stupefying nonsense undermines national policy to protect our heritage and environment pursued by successive Governments and their agencies throughout the past 50 years. The thought horrifies millions of people of all political persuasions. The results will be to reduce access to the countryside, to increase charges for leisure, recreation and sporting activities and to remove environmental safeguards.
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  The Minister of State bleats like a herdwick about the planning system, but areas such as the Lake District are already under tremendous pressure, and last year 45 per cent. of planning appeals there were successful—higher than the national average for appeals at 38 per cent.
  The planning system, even in designated areas, will not on its own be adequate to guard against those threats. Agricultural improvements, afforestation and some recreational developments are already outside the planning system, as the Minister should know. Similarly, the curtailment of existing access provision and the removal of positive management by new owners fall outside the scope of development control.
  The Water Bill sets out the environmental duties of the water industry after privatisation. Both the National Rivers Authority and water plcs will have a duty to further conservation and have regard to public access in carrying out their functions, as the Secretary of State says. But there are no safeguards covering the activities of subsidiaries —those companies outside the core activities of water supply and pollution control. The Bill provides an open invitation to developers to exploit those assets—our countryside and our green spaces.
  Speaking on "London Plus" on 26 October Michael Carney, secretary of the Water Authorities Association, said it all when he said:
  "If there's something surplus it will be got rid of."
  That sums it up. Private companies will go all-out to ensure the quickest possible return and the taxpayer, the water consumer and the environment will pay the price.
  South-West Water has already sold Brent moor in Devon to a private developer. Planning applications followed. The site was resold and planning appeals are likely to persist. The National Trust offered to buy the land to save it for those who enjoy it at present, but it has simply been priced out of the market.
  In Hertfordshire, Thames Water is cashing in on land at Hemel Hempstead near a reservoir where housing is planned. In the Peak District national park, North-West Water has been disposing of land without any discussion or consultation with the planning board.
  In his vision of the future for privately owned water supplies, Mr. Roy Watts of Thames Water gives the game away. No doubt with the track record of privatised industry bosses in mind—a 160 per cent. wage increase bonanza—he looked into his crystal ball and said:
  "I see a lot of fun—playing hard, working hard—I see a sports ground—I see a training centre—I even see an executive helicopter."
  In other words, he sees large rewards at the taxpayers' and consumers' expense for less responsibility than he has now.
  The most incredible of all the Secretary of State's claims for the Bill is his apparent discovery that the best possible reason to sell off the nation's water and land assets is to protect the environment. The claim is based primarily on the establishment of a National Rivers Authority. The creation of a powerful environmental protection agency, which has long been Labour party policy, would have our support, but like many other of the Government's proposals, something with more appropriate powers could and should be established. It is simply not necessary to sell off the water industry to achieve those objectives. To facilitate the privatisation of water the Secretary of State is proposing an act of nationalisation—the establishment of a National Rivers Authority—the equivalent of a water

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  Property Services Agency, the kind of organisation that all his Back Benchers have been pressing him to get rid of ever since he came to office.
  The National Rivers Authority proposal is a means of taking away from the 10 water authorities their non-profit-making, environmentally necessary functions which, if they had remained with the water authorities, would have deterred investors and prevented a successful flotation.
  Having removed non-profit-making environmental concerns from the sale—destroying in the process the important environmental concept of river basin management—so as to make the sell-off more attractive, the Secretary of State now expects us to believe that he will re-impose those environmental concerns on private owners by regulation. The Blue Book that the Secretary of State has published on the new authority makes it clear that it will be heavily funded—yes, by the taxpayer. So much for freeing essential environmental expenditure from the confines of the PSBR.
  First, the Secretary of State looked for an experienced independent chairman for his powerful new body. He found none other than Lord Crickhowell, an "indepedent" friend of the Prime Minister and former Tory Cabinet Minister. The latter quickly described the existing levels of staff and obligations as "a problem". He confirmed the Government's intention to slim down the authority and contract out much essential work. In other words, redundancies already loom in an area where oversight, scrutiny and control of pollution is woefully inadequate.
  The claims for a powerful new agency are further undermined by the reality that the National Rivers Authority will contract services back to the privately owned water companies. As the very effective report "Liquid Assets" from the Council for the Protection of Rural England and the Royal Society for the Protection of Birds makes clear, private water companies would then be monitoring and analysing their own effluents—the very situation that the National Rivers Authority is said to be intended to avoid.
  The report concludes that the safeguards written into the Bill are not adequate to counter potential threats to the environment. We agree with that. A Greenpeace report entitled "Poisoning the System" demonstrates convincingly that, far from improving the law on pollution control, the Bill is a step backwards. Once the water industry is in private control it will be able to use the same legal loopholes as industry currently uses to avoid detection let alone prosecution. The transfer of sections of the Control of Pollution Act in the Bill ensures that outcome.
  The public register system provides information on all consents to discharge effluent from sewage works and on direct industrial discharges. Data from the public register may well show an industry to be consistently acting illegally, yet the public would be unable to prosecute on that evidence alone. Private water companies would be subject to the same legal loopholes that currently protect industry from prosecution. The Bill will make it almost impossible for an individual to bring a private prosecution against a private water company.
  Throughout the 1980s we have been witnessing a rapid decline in the quality of the United Kingdom's rivers for the first time since national records began being kept in the 1950s. More of our rivers than ever before are simply dead. Yet the Government and the water authorities have a lamentable record on prosecuting in the event of any of those offences.
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  The number of reported pollution incidents on rivers in England and Wales rose from 12,500 in 1980 to 23,000 last year. Yet in 1986 only 254 prosecutions were taken out by water authorities out of a total of more than 20,000 pollution incidents—an enforcement rate of 1 percent.
  In 1985, too, water authorities acting in concert with the Department of the Environment and the Secretary, of State, relaxed many of the existing consent conditions. The Secretary of State revealed that 1,800 sewage treatment works discharge consents were relaxed between 1984 and 1986. The water authorities were thus legally allowed to discharge higher levels of effluent. That, in turn, led to pressure from industrial dischargers to have their consents revised— as happened in the North-West Water area. And in the runup to privatisation the Government are considering requests known as variation orders which would relax consents for about 300 sewage worksin which water authorities are breaking the law.
  The Select Committee on the Environment recommended in 1987 in its report on pollution of rivers and estuaries that subsections of the Control of Pollution Act 1974, dealing with the protection of rivers' flora and fauna from polluting discharge, be implemented. The Government refused to implement that section of the Act.
  There are no integrated proposals in the Bill to deal with the problem of deteriorating water control in England and Wales, and the Secretary of State has no clear national objectives. The Bill contains no river and drinking water quality standards, nor any commitment, in the near term at least, to meet European Community standards.
  Faced as they are with the priority of making profits, it is extremely unlikely that the vigorous policy of environmental improvement that is urgently required will appeal to privately owned water industries. It is also unlikely that a Secretary of State for the Environment who said in a recent "Panorama" programme that it was not worth prosecuting water companies will take the tough stance that is required.
  Nor is it likely that a Secretary of State who has stood by in the face of all the evidence of more than 20,000 people being poisoned by their water supply at Camelford in the south-west—and who has done nothing when he should have set up a public inquiry—is a person who will safeguard, let alone enhance, the environment. That is an appalling omission—
  Mr. Nicholas Baker: On a point of order, Mr. Deputy Speaker. I have the greatest respect for the hon. Member for Copeland (Dr. Cunningham), but he has now exceeded the time for which the Secretary of State spoke. Mr. Speaker said that he was anxious to—
  Mr. Deputy Speaker: Order. Mr. Speaker said that he was invoking the power vested in him to impose a 10-minute limit on speeches from 7 pm to 9 pm, and expressed the hope that before that right hon. and hon. Members would make brief speeches, but there is no power to curtail speeches, and the hon. Member for Copeland (Dr. Cunningham) is under no time limit.
  Dr. Cunningham: The Parliamentary Under-Secretary of State for Health has said a word—or perhaps more than a word—about all this. A little while ago, urging people to adopt better eating and drinking habits, she said:
  "Instead of drinking Coca Colas, turn on the tap and drink what the good Lord gave us."

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  In the light of this Bill, the hon. Lady will have to revise her advice to the people of Britain.
  Shakespeare, on the other hand, wrote in "The Merchant of Venice":
  "There be land-rats and water-rats, land-thieves and water-thieves".
  This Bill is designed for them.
  There is a wide gulf between us and the Government. Tories are legislating today to create private monopolies, and to introduce profit-making into domestic water supply. We reject that idea absolutely. Tomorrow, Tories will vote to put the interests of private monopolies before the interests of families and the environment. They will vote tomorrow to undermine the foundations of policy on our national parks and common heritage.
  More than a century ago William Wordsworth—[HON. MEMBERS: "Oh, no."] Oh, yes. William Wordsworth foresaw the need to create a national park in the Lake District, when he wrote that the British people
  "by their visits, often repeated, to the Lakes in the north of England, testify that they deem the district a sort of national property, in which everyone has a right and interest."
  The people's feelings and the poet's vision were made reality by a Labour Government with their National Parks and Access to the Countryside Act 1949. This Bill erodes that right and denies that interest.
  No resource is more fundamental to the health of the people than water. We stand by our view that a plentiful supply of wholesome water should be available to every household in Britain at the lowest possible cost to consumers and the nation. We believe that there are irreconcilable conflicts between that objective, the demands of good public health and the interests of shareholders and market forces in water provision. It was exactly these conflicts and crucial national issues of water purity—public health, coherent policies for sewage disposal, pollution control, environmental protection and the strategic investment necessary to secure these vital national interests—that led to water becoming a public utility and monopoly in the first place. for us they remain the most fundamentally important objectives, far outweighing the interests of Tory dogma, of private owners and of private gain. That is why we oppose the Bill.
  5.57 pm
  Sir Hugh Rossi: I shall vote in favour of the Bill tomorrow because it contains some of the most advanced measures for the protection of water quality in this country since those of the Control of Pollution Act 1974, in which I was involved as a junior Minister.
  I welcome the fact that the Government have now accepted the need to establish a single independent regulatory authority. It has been wholly unacceptable that the water authorities—owned by the public—have acted in such a way that, for example, in 1986, 22 per cent. of all water treatment plants were polluting water for 95 per cent. of the time. They could not prosecute themselves, and the Department of the Environment could not prosecute another public authority. So it is necessary to devise an arrangement under which the water authorities become subject to the law in exactly the same way as the private sector, and privatisation is one way of ensuring that.
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  The hon. Member for Copeland (Dr. Cunningham) quoted in aid some dubious figures that his research assistants produced for him about capital expenditure. I refer him to a document that he did not want mentioned—
  Dr. Cunningham: I resent the hon. Gentleman's use of the phrase "dubious figures found by my research assistant"; I hope that he will withdraw it—[Interruption.] I understand that Conservative Members are not interested in the truth. My figures were produced by the statistical section of the House of Commons Library and are based on the expenditure figures of the English and Welsh water authorities. I said that when I quoted them. Now I have said it again, so I hope that the hon. Gentleman will withdraw his slur.
  Sir Hugh Rossi: In that case, I suggest that the hon. Gentleman has the figures checked. He was not at all interested when I intervened and tried to suggest that he should look at the report by the Select Committee on the Environment. The figures in that report were carefully examined by that all-party Committee; his hon. Friend the Member for Bootle (Mr. Roberts), who is now sitting at his side, accepted them and was a signatory to the report in which they are contained.
  Let us look at public sector investment in sewerage and sewage disposal in England and Wales between 1958–59 and 1989–90 in the context of 1985–86 prices. If the hon. Member for Copeland looks at that he will see that the peak shown on the chart in the Select Committee report was reached in 1973–74, when the annual investment was approximately £850 million. From then on, under a Labour Administration, there was a precipitous decline to a trough in 1979–80. That was agreed by the Select Committee, which said:
  "As the chart shows, there was a steady drop from the mid-'70s until the early '80s in investment by the water authorities in sewage and sewage disposal.
  Because of the lead time required for investment we are now suffering today".
  That is why the water authorities are in such trouble, with 22 per cent. of them discharging polluted water for 95 per cent. of the time.
  I should like to address some questions to my right hon. Friend the Minister on some aspects of the legislation that cause me a little concern. He has suggested that the National Rivers Authority should be responsible, not only for pollution control, but for flood defence, fisheries, recreation and navigation. We should like to see that authority as a powerful and effective body dealing with water pollution. Is it necessary to lump in these other activities, which would only muddy the water of its main work?
  When the Select Committee considered these matters, it said that either an independent new body should be created to see to these matters or that the inspectorate of pollution should be increased in size, power and responsibility and should be given executive responsibilities for water monitoring and prosecution. Quite clearly, the water authorities were incapable of carrying out those functions because, as they could not control themselves, it was hard to expect them to prosecute the private sector.
  We have heard in recent weeks that the inspectorate of pollution is in some kind of difficulty. In a short time we have seen the resignation of two chief inspectors, which does not bode well for the way in which we monitor water

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  pollution. Can the Minister tell the House about the relationship between the National Rivers Authority and the inspectorate? Will the inspectorate be absorbed into the National Rivers Authority, or will it be outside it? If it is outside the NRA, what will be its function?
  I spoke earlier about my experience in the Department when I was responsible for these matters. At that time, in 1973–74, I was tremendously impressed by the calibre of work and the quality of what was then known as the alkali inspectorate. It had been established for about 125 years and was manned by scientists, people of the highest calibre, who achieved such a relationship with industry that Britain was able to boast of being in the forefront of nations dealing with environmental problems. That was the case under the Clean Air Acts, the Water Acts and many other Acts. We owe the inspectorate a great deal.
  Shortly after I left the Department, in fact in 1975, for reasons that I do not know, under a Labour Government the chief inspector's post was downgraded from under-secretary to grade 4. If the Opposition attach such importance to such matters, why did the Labour Government starve the water authorities of the necessary investment and at the same time downgrade the post of the chief officer in the Department? That downgrading had a tremendous impact on the morale of the Department.
  I understand that the Department is currently reappraising the status and grading of the inspectors and the chief inspector. My right hon. Friend should have regard to the tremendous reputation of the inspectorate. The work that it has done over more than 125 years has been recognised by one Royal Commission after another and it would be a great pity if the ethos of that small unit in the Department were destroyed.
  I find it a little difficult to understand why the person in charge of that unit is an administrator and not a chief inspector. Perhaps some of the problems that we have heard about arose because of a difference of approach and attitude between the scientists, the people at the coal face looking after pollution problems, and administrators in the Department. These are internal matters, but they are within the remit of my right hon. Friend, and I am drawing them to his attention because it is within his power to put them right. I hope that he will do so.
  At the time that my Select Committee reported, there were 11 water inspectors for 10 water authorities. That is 1·1 inspector for each authority. That is totally inadequate in a system where monitoring will be done from outside the water authorities themselves. Within each of the 10 water regions I should like to see a regional office of pollution inspectors who would be responsible for the constant monitoring of waters and rivers within their geographical area. They would need to have the necessary laboratory back-up to test water quality, trace discharges and determine the pollutants going into the rivers. They would also need a legal staff to ensure that prosecutions were followed through from the results of their monitoring.
  I do not know whether my right hon. Friend envisages such a scheme within the National Rivers Authority, or what use he intends to make of the inspectorate. If thoughts along those lines are not already in his mind, I hope that I have put them there.
  The other matter with which I wish to deal was mentioned by the hon. Member for Copeland—the need to have national water quality objectives. The Committee suggested that they were a prerequisite for a planned and
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  costed programme. It suggested that we should have regard to the effects of effluents on flora and fauna when considering water quality.
  I am a little disappointed that under clause 97 the first requirement for water quality—when the mechanism to monitor it is set up—will be to have regard to the purposes for which the water will be used. That is an old-fashioned, cheap approach. The only way in which we can ensure good, clean water in our rivers is to ensure that nothing is put in them that damages life. That must be the aim and final objective. When my right hon. Friend considers the water quality objective, as he will have to before the Bill is enacted, I hope that he will have more regard for life in rivers.
  I shall curtail my remarks, in view of what Mr. Speaker has said, but I should like to mention the loopholes to which the hon. Member for Copeland referred. I draw the House's attention to evidence that the Select Committee received when preparing its third report. We received evidence from the Severn-Trent water authority, and paragraph 102 of the report says:
  "It is possible for a discharger to introduce some new contaminant not envisaged when the consent was granted, and hence not limited, to cause serious pollution and then to claim this protection. Protection should apply only to those components of the effluent which are governed by specific conditions."
  If an industrial plant is given permission to discharge a chemical into a river, but adds another chemical, it is able to say, "I cannot be prosecuted." As the law stands, it has a licence to discharge, and the fact that the chemical that it is discharging is not mentioned in its licence gives it a measure of protection.
  I can give specific examples of where that is happening. My attention has been drawn to this problem by the Yorkshire Post, which has carried out an assiduous campaign. It gives specific incidents of a company discharging cadmium into the River Aire. Cadmium is one of the two most poisonous substances known to man, but a company is discharging 12 kg of it per annum under a licence that does not refer to it. The water authority is unable to prosecute. Clause 100 will make it an offence knowingly to permit any poisonous or polluting matter to enter controlled water. An exception is given in clause 101 for those who have consent.
  I ask my right hon. Friend whether the combination of those two clauses will block the present loophole. I agree with the hon. Member for Copeland that this is a serious matter, which causes great concern. I hope that my right hon. Friend has addressed himself to this problem and will find a solution to it.
  Dr. Cunningham: The hon. Gentleman and I had a disagreement before, but I join him in praising the Yorkshire Post and other newspapers which have drawn attention to the flouting of pollution control law. It is my understanding—I am pleased that the hon. Gentleman asked the Secretary of State this question—that nothing in the Bill will change those circumstances. I should be grateful if the Secretary of State would answer his hon. Friend's question.
  Sir Hugh Rossi: That is the view put forward by Greenpeace. On occasion, the Committee had to question the evidence given by it. It is an effective pressure group, but it tends to get rather excited and, at times, to overstate

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  its case. It has sent me a copy of the document to which the hon. Member for Copeland referred, but I have not had an opportunity to read it in detail.
  Part of the object of Second Reading is to ventilate matters so that when they are considered in Committee and on Report the Government can close any loopholes in the legislation. I should like to think that the Government have directed their attention to these problems and that they may already be covered. Nevertheless, there is no reason why a marker should not be put down, because it is a very serious defect in the law. The problem is that polluters are not acting illegally, If they were, certain consequences could follow. We must therefore ensure that such behaviour is made illegal.
  I hope that I have not kept the House too long. I only wished to ask two or three questions about pollution. I think that there can be a tightening and close examination of pollution controls, and I hope that my remarks will commend themselves to my right hon. Friend. Subject to that, he will receive my support in the Lobby. I shall wait with interest to see how the matter is dealt with.
  Several Hon. Members rose—
  Mr. Deputy Speaker: Order. I remind the House that Mr. Speaker has appealed for brief speeches.
  6.16 pm
  Mr. Richard Livsey: I commend to the House large parts of the speech of the hon. Member for Hornsey and Wood Green (Sir H. Rossi), especially that part relating to pollution control and the pollution inspectorate. I am certain that he is right in saying that powers need to be improved and expert personnel need to be available on the ground.
  The objective of the Bill is quite clear—to dismember the 10 water authorities, which are successors to local authority control, of water resources and supply. They were created to improve standards of public health. We must recognise that, before they were taken into local authority control, there were horrendous problems related to health. In short, the water industry has always been regarded as a service, not an industry suitable for privatisation. We will therefore vehemently oppose the Bill.
  The size of the industry has increased enormously, especially since its reorganisation in 1973. It now has an annual turnover of £3 billion. Water authorities supply water to 75 per cent. of the population and sewerage facilities to 96 per cent. It is a large industry and employs 48,500 people. None the less, it is a service industry and should remain in the public sector.
  The industry's present functions, especially those of river basin management, are important. The effectiveness of its river basin management is admired throughout the world. Its sewerage and sewage disposal responsibilities have been shown to be unsuccessful at present, and it is reckoned that 20 per cent. of sewage disposal units are ineffective. This is a serious problem and will require much more public money if the system is to be effective. It is therefore doubtful whether the private sector will be able to find sufficient resources to bring about more effective pollution control.
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  The water authorities have functions in respect of fisheries, flood protection and drainage—that is especially important for agriculture—navigation, recreation and conservation. Over the past 10 or so years there have been massive efforts to reduce costs in order to improve the efficiency of the water authorities. They are now leaner and fitter. There is no more scope for further cost cuts. This is part of the problem with privatisation of the industry. Profits will come only by increasing the price of water to the consumers and selling off the water authorities' assets.
  The transfer from a public monopoly to a private one does not introduce competition, and that is surprising. The Bill does not apply to Scotland, and we see no reason why it should apply to Wales. The splitting of functions between the National Rivers Authority and water services companies could have been achieved while the water industry was still in the public sector, and we see no reason why that should not have happened.
  Mr. Allan Roberts: What does the hon. Gentleman have against England? He has exempted Scotland and Wales. Why should we suffer?
  Mr. Livsey: I am sure that the hon. Gentleman is well able to make the case for England.
  We are in danger of having a toothless National Rivers Authority, unable to cope with the voracious demands of the water plcs for more profit at the expense of consumers and the environment.
  We are worried about the financial arrangements for the National Rivers Authority. First, there seems no logical reason why the money which the Treasury will pocket from the sale of the water authorities should not be used to meet the set-up costs of the NRA. Secondly, we are worried that the NRA will not be properly financed to meet its day-to-day duties. The NRA's remit and powers are generally satisfactory, but the authority can only be as effective as its budget will allow. It is dependent on the Treasury to fund activities beyond those that its income allows it to undertake. The NRA's regulatory functions rest in the Chancellor's hands.
  We know that the Department of the Environment does not envisage the NRA receiving substantial state support. That will result in a clear conflict of interest. The Chancellor wants to raise as much as possible from the industry's sale, but knows that the greater the regulation through the NRA the lower the industry's value will be. There is a direct incentive for the Treasury to under-fund the NRA. In its general information pack, the DOE said:
  "The general policy of the NRA would be to maximise its cost recovery from charges so as to minimise its dependence on Exchequer grant."
  In a speech on 12 November, Lord Crickhowell, chairman of the NRA advisory committee, said:
  "It cannot be healthy for the NRA to be dependent on hand-outs from the Government."
  Clearly, there is a conflict.
  Thirdly, there is concern about the NRA's long-term financial position. The authority is classified as "non-departmental public body"—presumably, that is Treasury terminology. The authority will have no long-term borrowing powers. I should like the Minister to take serious note of that point. The present water authorities have borrowing powers and massive problems occur in drainage and flood control which require additional finance, often at short notice. In the past, the water authorities have borrowed a great deal.

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  We are worried about the NRA's structure, because we do not want it to become over-centralised. Lord Crickhowell touched on that point in his speech to the national water conference, saying:
  "Within the framework of national policies laid down by the NRA, the regional units shall have the greatest practical degree of independence."
  The NRA should be independent. That point was made by the hon. Member for Hornsey and Wood Green.
  The flotation of the water companies seems to be far removed from consumers and consumer interest. We are not sure why the Government will not consider the consumers' interests more in those areas covered by the plcs, why there should not be participation in share ownership by consumers and why should there not in certain cases be co-operative arrangements with consumers. Surely we need bodies that have consumer interests at heart.
  Dr. D. E. Thomas: On the point about consumer control, my hon. Friend will be aware that the Minister for Water and Planning is a respected fellow countryman. I am certain that he will have carefully considered whether it would be appropriate for the functions of the Welsh water authority to be transferred into the hands of Welsh consumers, should such a co-operative be established. I am certain that my hon. Friend will agree.
  Mr. Livsey: I certainly agree that Welsh consumers should participate in the ownership functions carried out by their water authority. It is questionable whether the functions of the Welsh water authority should be hived off at all, unless it happens in those circumstances.
  Mr. David Ashby: How does the hon. Gentleman propose to ensure that only Welsh people apply for the shares?
  Mr. Livsey: I am sure that, if the Government wished, such a facility could be given in the Bill to the Welsh people. We shall certainly test the Government on that aspect.
  Water consumers are worried. I hope that, at the very least, the Government will make provision in the Bill for the Government to hold a golden share, to ensure that the plcs remain in Britain's hands rather than sold to foreign investors. I am sure that the Government agree.
  It is clear that under the Bill there is no competition. When, on the BBC programme "On the Record", it was put to the Minister for Water and Planning that the consumer would have no extra choice as a result of privatisation, he replied:
  "Yes, that is probably right."
  The Minister admitted that there would not be much competition. The consumer will not have in his house six taps providing water from six plcs. Water is four times more expensive in some parts of France than in others. I trust that the Government will not allow that to happen when the Director General of Water Services is appointed.
  We are worried about what will happen in the Principality of Wales, because water from Wales services the midlands and other parts of England. We hope that the future arrangements will bring us adequate compensation for the export of that water, and that we will be properly reimbursed and not under-sold. That is important.
  The infrastructure of the water industry is in a very bad state in some parts. Many Victorian sewers need to be
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  repaired and new water pipelines installed. That is a massive task. Most estimates of bringing water quality up to EEC standards show that the work could be done at a cost of about £6 billion. We are concerned that the Secretary of State today mentioned a figure of £2·4 billion to put matters right, which is less than half the current estimate. We hope that the Government will reconsider that matter.
  We are also concerned about the current massive land assets of the water authorities. They own 450,000 acres of land and we are not certain what will happen to that land when the industry is privatised. They own 97,000 acres in Wales alone and, in my constituency of Brecon and Radnor, there are 21,000 acres of water authority land in the national park. That is an extremely valuable asset and we should like to know what will happen from the point of view of access and recreation.
  Many farmers on that land are tenants of the water authority. What will be their security of tenure? What will happen to their rents when water is privatised? Will they be able to continue in their traditional farming activities, or will they be priced out? Those are important issues which should be discussed in detail in Committee.
  We regard the Bill as unsatisfactory. Water is not suitable for privatisation. Many hon. Members are involved in the recreation aspects —I am a keen angler—and are anxious to know whether the fishery aspects will be protected and developed at a cost that everyone can afford. We hope that angling, which is the most popular sport in the British Isles, will not be priced out for the ordinary person as a result of the privatisation of the industry.
  We must remind the Minister of the consumer interests that are at stake, particularly in the disconnection of consumers from their water supplies. Last year, disconnections reached an all-time high of more than 9,000. As water is a basic, natural resource, vital for life, consumers should not be cut off in that way.
  The poor and lower income groups are particularly exposed to that problem. Low-income families and individuals have to pay rates and water rates from benefit, and those rates are taking increasingly large proportions of their benefit. In the past six months, the standing charge for those consumers with water meters has risen by 33 per cent. I have been shown such cases, and they are very worrying. We hope that the consumer interest will be taken into account in the Bill. The director general must be effective. I do not believe that the estimate of 80 staff in his office is sufficient to protect the industry and the consumers' interests.
  1 hope that the Minister will take those points into account. The Bill needs amending substantially if it is to make a worthwhile impact. We oppose the principle of the privatisation of water and are glad to say so.
  6.34 pm
  Sir Charles Morrison: In considering the transfer of a utility from the public to the private sector, it is worth remembering that there are two reasons for the existence of the public sector, the one Socialist and the other pragmatic. My right hon. Friend the Secretary of State referred to the Socialist reason when he opened the debate. It is the continuing Socialist conviction that only as a result of the nationalisation of the means of production, distribution and exchange, coupled with all-embracing state provision, can the public good be

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  served. I totally disagree with such ideology. It provided some dream of a solution to the ills of the late 19th and early 20th centuries, but it never succeeded in practice.
  The second reason for the existence of a public sector is the pragmatic one that, at one moment or another in our history, it was seen or believed that the private sector would not, or could not, meet a public need. That is why I do not believe it is a self-evident truth that, automatically, everything in the public sector must be bad or badly run, and everything in the private sector must be good or well run. I hope that the Government do not believe that either. If they do, they should beware, because they would then be in danger of becoming as ideological as the Opposition. Instead of judging issues on their merits, issues would be judged according to the theories of some doctrine or dogma. In my judgment, common sense and pragmatism should be the basis of our thinking about the future of the water industry.
  It is against that background that I want to deal with the Bill, while remembering that water first came under public control, as we were reminded in a letter to The Times earlier this week, as a result of the determination of a leading Conservative. That does not mean that the time has not arrived for water to be transferred from the public sector back to the private sector, but I again emphasise that it is important to adopt a pragmatic approach to the question of how water should be organised.
  The Bill creates a new strategy for water. Given the nature of water and its supply, I cannot see how the Bill can be claimed to provide competition. My right hon. Friend the Secretary of State referred to the concept of "comparative competition." That is all very well, given the 10 water authorities and the 10 plcs that will exist. Standards may be adequately set as a result of their existence, but there will be no competition in any normal sense of the word. The Bill therefore creates the opportunity for public monopolies to become private monopolies. However, as we have heard, those private monopolies will be freed from the financial constraints that they currently suffer as a result of being part of the public sector.
  Undoubtedly, most of the existing water authorities have, at some time or another, been at the receiving end of justified public criticism, but most of the problems that have given rise to that criticism in respect of poor supply, poor water quality, pollution and inadequate sewerage systems have fundamentally stemmed from Treasury meanness, as a result of which water authorities have not been able to invest as much as they would have wished. Privatisation will certainly overcome that difficulty, because the water plcs will be able to go direct to the market to obtain the capital that they believe is necessary. Thus, it should be possible gradually for the water industry as a whole to become more efficient and less open to many of the criticisms that have been aimed at it in recent years.
  None the less, the industry will not be operating as a free agent. It will be subject to regulation by the Director General of Water Services and the National Rivers Authority. It occurs to me that the director general will have to be some sort of Solomon, especially in the early years of his existence. That is if he is to be seen to protect the customer from price rises at the same time as the plcs
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  are investing considerable extra capital to meet the requirements of the director general and of the NRA. No doubt such a paragon can be discovered and appointed.
  The concept of the NRA as a regulatory body is admirable. It will remove the conflict of interests that currently exists, with water authorities being responsible for discharges to water, especially of sewage, and for the control of discharges. I should be happier if the NRA were to be a purely regulatory body, without any functional responsibilities. Fortunately, the Government have decided to retain the existing system river basins as the basic structure for the plcs. It seems, however, that there will be some overlap between the responsibilities of the plcs and those of the NRA. If that is so, the opportunity is created for the buck to be passed—I suspect, particularly from the plcs to the NRA—when a necessary expense arises that can give no extra return to the plcs. I hope that my hon. Friend will be able to allay my fears on that score.
  The interests of anglers must be recognised, and I happen to be a president of their national council. It is clear that fisheries are to be a major responsibility of the NRA, and that is right. Fishing is a major recreation along rivers and around reservoirs, and it seems that there is no safeguard for specific recreational activities that are currently enjoyed on water. It appears that, within the meaning of the Bill, a plc may abandon one recreation in favour of another. As major users, that could be to the disadvantage of anglers. I accept, however, that it could be to the disadvantage of other users of certain stretches of water. I hope that my hon. Friend will be able to reassure me.
  Anglers are concerned about high water quality. Credit can be given to anglers and their various organisations for the way in which they have stressed the importance of water quality in the past. This has resulted in many improvements being made. Anglers fear that the Bill might lower standards of quality.
  Previous legislation promoted a national policy to restore the wholesomeness of rivers. My hon. Friend the Member for Hornsey and Wood Green (Sir H. Rossi) said that clause 97 refers to the classification of quality of waters. Apparently, water quality standards are to be related to the use of water. It is felt strongly by anglers, and no doubt by others, that there should be public consultation before water quality standards in any given area are agreed; otherwise, a lowering of standards might occur for cost-cutting purposes, regardless of the interests of users, and anglers especially.
  Given such a consideration, would it not be sensible to have two members representing fisheries on the NRA board, with at least one other representing water recreation? There are 2,700,000 freshwater anglers, and water recreation in its various forms involves about 6 million people.
  The Government should take careful note of the concern that has been expressed about what will happen to the 450,000 acres that are currently owned by water authorities.
  Mr. Cranley Onslow: Before my hon. Friend moves on from his comments on angling, which he has been making so admirably, would he care to add that many anglers are puzzled about why flood prevention committees are to have executive responsibility, whereas regional fisheries committees are not, given that a great deal of the moneys will come from anglers?
  Sir Charles Morrison: My right hon. Friend makes an important additional point, which I did not mention because I was trying to limit myself in time. What he has said is of great importance and I hope that my right hon. and hon. Friends on the Treasury Bench will take careful note of it.
  I was referring to land in the ownership of water authorities, and was about to mention that there is concern about access to it. I shall not expand on that issue, because it has been mentioned several times already. I merely say that it is essential that the Government view the matter sympathetically.
  Overall, anglers welcome the proposals for the NRA. The authority will act effectively, however, only if it has adequate financial resources. Here there is a contradiction in the Bill, and it was referred to by the hon. Member for Copeland (Dr. Cunningham), who spoke from the Opposition Front Bench. The new pies will be freed from Treasury constraints, but the new NRA will be subject to them. I have to admit my worry when I read that grant in aid to the NRA will be paid to the authority
  "subject to the Treasury's approval".
  What guarantee is there that the Treasury will be less mean than usual?
  Mr. Nicholas Soames: Oh!
  Sir Charles Morrison: I know that the NRA will receive income from direct charges, but it was only last week that I was told of a story concerning the grandfather of my hon. Friend the Member for Crawley (Mr. Soames), who always referred to the mean Treasury. I hope that the grandson will learn from the grandfather, rather than seek to correct me when I refer to Treasury meanness.
  The NRA will receive income from direct charges, such as navigation and rod licences, from water extraction and from discharges, but without adequate grants it will not live up to the expectation that many have of it. As a reassurance, the NRA should have a guaranteed grant, which should not be reduced. Without that, and even with the best will in the world, the NRA may not be able to live up to its responsibilities, especially in monitoring the effect of pollution along the 25,000 miles of rivers, in coastal waters, on ground water and in estuaries, for which it will have responsibility.
  The Bill is a mammoth piece of legislation that includes a mass of matters of substance and of detail. It is heading for lengthy consideration in Committee. I hope that my right hon. Friend the Leader of the House will take account of the recommendations of the Procedure Committee and very early on introduce a timetable motion for its consideration in Committee. Only in that way will there be a reasonable time for every part of the Bill to be discussed. Only in that way shall we ensure that it is not only the other place that deals with a great deal of the Bill. I am sure that the Bill will receive a Second Reading tomorrow night. When it is deliberated upon thereafter, I hope that there will be adequate opportunity for consideration of all major aspects of it and time to reassure those who now have reservations about it.
  6.49 pm
  Mr. Peter L. Pike: The Secretary of State for the Environment and the hon. Member for Hornsey and Wood Green (Sir H. Rossi), the Chairman of the Select Committee on the Environment, mentioned the figures for investment in sewerage and sewage disposal functions in
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  England and Wales from 1958–59 to 1989–90. Those figures have been used in a misleading way, as is shown by chart 1 of the Select Committee report, to which they referred. Although it is clear, in constant 1985–86 prices, that spending reached a peak in 1974–75, it is also clear that it is still far below that peak, despite the fact that the Conservative Government have been in power for nearly 10 years.
  It is completely misleading for the Secretary of State and the hon. Gentleman to talk of a long lead-in period when they are considering the present situation. If that were true, they must also accept that the figure that they claim was the peak in 1974–75 was planned during the period of office of the Labour Government under the leadership of Lord Wilson. The Government cannot have it both ways. Although the forecast shows an increase in the next few years, investment will still only reach two thirds of that peak figure. They must put the figures in that perspective.
  I want to refer briefly to an editorial in the Lancashire Evening Telegraph on 1 December which shows the problems of this appalling Bill. There was an article in that paper on the same day about the conflict between the chairman of North West Water and his deputy chairman, who happens to be the chief executive as well. I must point out that the deputy chairman has been involved in the water industry for considerably longer that the chairman. Like many others, George Mann, the previous chairman, was removed because he would not have been politically in favour of the privatisation of water. The Government have ruthlessly removed almost everybody they could from the water industry who might have opposed its privatisation. They have done that extremely skillfully and ruthlessly over the past few years in preparation for their privatisation proposals.
  The deputy chairman of North West Water is quoted as saying that the sell-off is "a waste of time". The chairman of North West Water says that we can disregard that because the deputy chairman is due to retire. The deputy chairman, Bryan Oldfield, has long experience in the industry. It is true that he will retire in a year's time, but Dennis Grove, the chairman, has a short experience of the industry and has been dedicated from the start, like many other chairmen, to carry out the Government's will. Many chairmen and members of water authorities believe that they have the right to make that political decision, and many have played an active part in propagating the Government's views. They have not merely sat back and said that they had to carry out the Government's will, but they have been preparing for privatisation in advance of the Bill, and even in advance of the paving Bill.
  The editorial in the Lancashire Evening Telegraph says:
  "When it comes to the looming privatisation of the water industry, what choice will the public have?"
  I emphasise the word "choice", which is the in-word of the Conservative party at present. The editorial continues:
  "Water, after all, is the stuff of life—a vital commodity that people have no choice other than to use. In essence, it is a natural monopoly and, so, will be seen by millions of people as a fundamental service that should not be cast into the arena of free enterprise, where the making of a profit for investors is the bottom line and where the notion of improved efficiency and service to the customer is inevitably blunted because there will be no risk of them taking their business elsewhere … This is one piece of the Government's privatisation programme that is sure to run into choppy waters. And, at this stage, it would seem that it would have done well to leave the water industry off its list."

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  Those are true words and, even tonight, the Government should think again and drop this nonsensical proposal of privatising an industry that is so vital to all.
  I have said on previous occasions that I would be prepared to support the concept of the National Rivers Authority with a publicly owned water industry. If the National Rivers Authority is given adequate powers and staffing, and is organised on a regional basis to carry out its duties properly, it can play a vital role. I have no objections to the establishment of that body, but I am doubtful that the Government will give it those powers. The Association of District Councils, which is always Tory dominated, also expressed reservations that the National Rivers Authority will have those powers and the teeth to do its job because that may not be in the Government's interests.
  North West Water has the biggest landholding of all —more than 150,000 acres, of which over 53 per cent., 79,519 acres, is in national parks. That land is crucial. Many of us are worried about the possible destruction of our heritage by disposals of land. We all know that it is difficult to value that land. As a water catchment area, it has very little commercial value, but if a small section of land is disposed of and given planning permission, its value could change overnight.
  The Minister says that land will not be allowed to be sold, but the Bill says that land that is considered to be surplus to requirements can be disposed of. It has also been said that land in a national park would not receive planning permission for development. People who say that have more confidence than I have. I am fairly certain that it will be the financial interests of the water industry to find ways, with their Conservative friends in certain positions, to dispose of some of its land to make money out of it and, at the same time, destroy some of our heritage. These are extremely important matters.
  Clause 79 allows the Secretary of State to write off the authorities' debts. The Government are remaining very quiet about their intentions. When I met the chairman of the water authorities who came to the Labour party conference at Blackpool to lobby Members of Parliament —I am sure that they did the same at the Conservative party conference—they told me that they were expecting the Government to wipe off as much as possible of their debts because they would have a new debt, the shareholders' capital within the industry.
  They said that they believed that it was right that if the Government received the money for the shareholdings the debts should be wiped off as well. That is a stupid argument. At present, the Government own the assets of the industry and also the debts. When the debts are repaid by those water authorities, the Government will receive the money. We shall be giving something away just to allow people to make money. I am worried that, in the end, privatisation is about making money and that the quality of water and the problems associated with that will become secondary.
  Many voluntary organisations, such as the National Trust, the Ramblers Association, and other conservation bodies, have considerable reservations about the Bill. They are worried about access to the countryside and about the possibility of charges. Even if access is maintained, there is a duty on the water authority to earn an income from it if
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  possible. My hon. Friends and I believe that access to the countryside should be available to all people and should be available free of charge wherever possible.
  If we do not defeat the Bill tomorrow, we shall have to debate many matters at great length. I doubt whether the Government will recognise the folly of their ways, so the Bill will have to be amended if we are to safeguard some of those important matters.
  Several Hon. Members rose—
  Mr. Deputy Speaker (Sir Paul Dean): Order. I remind the House that the 10-minute limit on speeches is now in operation and I appeal for the co-operation of hon. Members who are called during this period.
  7 pm
  Sir Anthony Grant: During the past year, I have had several meetings with chairmen of water authorities and I assure the hon. Member for Burnley (Mr. Pike) that, far from being docile slaves of the Department of the Environment, they are extremely lively people. I understand that some of the discussions that they have had with Ministers could be described as extremely stimulating. But, like men of sense, they agree with me that there is a powerful case for the Bill.
  My right hon. Friend the Secretary of State made the case devastatingly in his opening speech. The point that I stress most powerfully is investment. After the lamentable failure of investment by the Labour Government, there is now an opportunity to free the industry from all restraints to enable it to compete for investment throughout the market and thereby to increase its efficiency, instead of standing in a dreary queue before the Treasury behind all sorts of other bodies. In addition, we must increase standards of water purity and reduce pollution. The creation of the National Rivers Authority is immensely important in that regard.
  The area that I know best is covered by the Anglian water authority. It is not the north-west authority, but Anglian authority which has the largest land area of the 10 water authorities. It is the fourth largest in the number of customers and in turnover. It has the fastest population growth of any authority, with about 500 new houses every week being connected to the water supply and 600 new houses a week linked to the sewerage system. It used to have the greatest problem with coastal defences, but happily that will become the responsibility of the NRA.
  There is great anxiety in the area of the Anglian water authority concerning nitrates in soil, but the fears have been vastly exaggerated. They are as ludicrous as some of the fears about eggs. On Monday, the hon. Member for Greenwich (Mrs. Barnes) said that the chances of getting salmonella were the same as being hit by a meteorite. The chances of contracting stomach cancer from nitrates in the soil in East Anglia is about the same as my hon. Friend the Under-Secretary of State for Health being struck dumb.
  In my area, water has been supplied excellently for many years by the private Cambridge water company. I tried to intervene in the speech of the hon. Member for Copeland (Dr. Cunningham). Eventually, my right hon. Friend the Secretary of State managed to ask him whether, in the remote event of a Labour Government being elected, they would renationalise the private water companies. The hon. Gentleman dismissed it by saying, "Probably there will be none." The hon. Gentleman would

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  not give way to me. When the Opposition spokesman replies to the debate I hope that he will tell us point blank what would happen to the private water companies in the event of a Labour Government taking office. Perhaps the hon. Lady would like to tell me now. If so, I gladly give way.
  Ms. Joan Walley: I am grateful for the opportunity to answer. The hon. Gentleman said clearly that there will be a Labour Government. Our commitment is clear. Because of this Bill, a Labour Government would ensure proper public control over water, which is God-given.
  Sir Anthony Grant: I assume, therefore, that the hitherto free private water companies will be taken over. We shall take that message back with us.
  The Anglian water authority approaches privatisation with enthusiasm, but it says that the regulatory regime is heavy and complex. It is heavier than that for any previous privatisation, but it says that it will make it work. The regime will certainly deliver the improvements in quality and environmental standards that my right hon. Friend has promised, and any fears to the contrary are entirely fallacious. But costs will be high and can be met only by increased charges. That would have happened irrespective of privatisation. Customers must recognise that higher standards mean higher charges.
  I beg the Government to ensure that the price control mechanism allows those increased costs to be recovered. Absolute clarity on cost time scales and recovery through charges is imperative if the companies are to be floated successfully. Much of the debate has centred on the environment, but we should remember that this exercise is primarily about establishing efficient and profitable public limited companies—[HON. MEMBERS: "Ah!"] That is what it is all about.
  Is it rather naive to assume that there is tremendous scope for offsetting the extra costs by savings made in operational costs. Anglian Water will continue to increase productivity, but since 1980 it has reduced its manpower by 22 per cent. against an increasing work load. All those factors must be taken into consideration.
  I am very much in sympathy with what my hon. Friend the Member for Devizes (Sir C. Morrison) said about the National Rivers Authority. It would be a great pity if the NRA became the poor relation of this exercise. In Anglia we believe that a highly professional, properly resourced NRA will be an essential part of the package embodied in the Bill, and I hope that Parliament will be careful to ensure that the Bill achieves those aims.
  Another reason why I strongly support the Bill is that it is a step along the path towards a wider share-owning democracy. I was a founder member of the wider share ownership movement longer ago that I care to remember —even before it became fashionable in the Conservative party. I have welcomed all the steps that have been taken, of which this is another example. I rejoice that there are now 9 million private shareholders. I hope the Government will ensure that privatisation of water will involve the largest possible circle of investors, so that many people can participate in a vital industry. It is important that the water industry is owned by those who are interested in and wish to be associated with it, rather than by a faceless bureaucracy. I feel sure that that will be the case.
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  I wish the Bill well. It is a formidable document. I weighed it at the post office and it came to about 600 or 800 grams—the post office no longer deals in avoirdupois. It is certainly one of the biggest Bills I have seen, running to 180 clauses. My hon. Friend the Member for Devizes (Mr. Morrison) made the important point that proper arrangements should be made to debate the Bill in Committee, if necessary with a guillotine, at an early stage. The Bill will improve and spread share ownership throughout the land, raise water quality, and increase efficiency. It deserves a resounding Second Reading.
  7.10 pm
  Mr. Gareth Wardell: In the Welsh language there is the phrase "asgwrn cefn", meaning determination, steadfastness, spine and a willingness to do that which is right. For a Government who supposedly pride themselves on their "asgwrn cefn", pulling the plug on the water industry must be one of the most hypocritical acts they have contemplated.
  First and foremost, the sell-off of water is a sell-off of Government responsibility. The Government are shedding responsibility for their policy of imposing such unrealistic financial targets and external financial limits since 1981 that water authorities have been unable to keep up with required levels of maintenance and investment needed to repair and improve basic water functions. Our network of sewage works is old, overloaded and often badly operated. In 1986, 22 per cent. of them poured into our rivers effluent dirtier than regulations allow. Reported river pollution incidents rose from 12,500 in 1981 to 23,253 last year. One sixth of all sewage is poured untreated into the sea and 69 per cent. of outfall pipes are at or near the low water mark.
  The Select Committee on Welsh Affairs, of which I am proud still to be Chairman, conducted an inquiry into coastal pollution. During our investigation, we saw one polluted beach after another. In the United Kingdom as a whole, only 70 per cent. of beaches meet EEC minimum pollution standards, and according to the European Environmental Bureau, only one in eight of Britain's beaches meet the EEC's full pollution standards over the complete range of 20 tests. I make the point that its definition of a beach is not that used by the Department of the Environment for many years to circumvent the EEC's bathing waters directive. According to the Department's definition, not one Welsh beach has a sufficient number of bathers using it to qualify for the tests.
  By imposing artificially low ceilings on water authorities' capital investment and borrowings, the Government have created a backlog of remedial works that will cost enormous amounts of money to clear. The Bill, financially and morally, sells off that responsibility. The Government see the spending forced on us by EEC directives—it is estimated that it will cost about £6 billion to meet EEC standards for drinking water affected, for example, by nitrates, aluminium, lead and chlorine.
  Over the past two months, Mr. Nick Carter, editor of the South Wales Evening Post, has spearheaded a battle to have Swansea bay cleaned of gross pollution so that it may again safely be used for swimming, surfing, fishing and water sports. That campaign has exposed thoroughly and in depth the cause and effect of pollution and the remedies. The campaign has the support of 36,000 residents who have signed the South Wales Evening Post petition, which is not lightly to be dismissed.

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  In response, Welsh Water points out that, for the past five years, it has spent £1 million annually on the bay, which was all it could afford while tackling higher priority pollution at locations such as Tenby and Porthcawl and improved water supplies for drought protection. The chairman says that Welsh Water has been informed that it must bring forward £28 million of planned investment to improve the bay by between one and six years, to 1995. The investment needed to clean up just that one small part of Britain's coastline is £90 million. The scale of pollution there, although totally unacceptable, is not as gross as in areas such as Askham, Cleethorpes or Blackpool.
  While the Department of the Environment has decided to spend £93,000 on much-needed research into the link between infectious diseases and the dangers of bathing in grossly polluted sea water, one is still tempted to say that the evidence is not there. The answer can always be given that no one has undertaken the necesssry research. Meanwhile, the results of a university of Sussex survey undertaken this summer offer good advice. That survey found that bathers who keep their heads above the water while swimming are far less likely to contract various diseases than those who swim with their heads below the waves. I feel sure that the Department of the Environment will confirm that that is good advice.
  Since the Government imposed external financial limits in 1981, water charges have risen from £165 million in 1981–82 to £620 million in 1987–88. Yet, with all those works in the pipeline and growing increasingly urgent, the Government claim that water charges will not increase. That must be double-speak. The Secretary of State really means that it will be water plcs which increase costs and not the Government, because the Government will have sold off their responsibility. Privatisation itself will increase charges. Accountants Arthur Collins and Company put the bill for privatisation at about £850 million per year. Water companies will need about £350 million for corporation tax, £400 million annually for shareholders, and another £100 million for higher management salaries, directors' fees, share registration, services to shareholders, and the National Rivers Authority. That will mean a 20 per cent. increase in charges just because of privatisation.
  The Water Authorities Association does not dispute that estimate. Several estimates, including those made by the chairman of the association, and of Welsh Water, conclude that water charges will increase by another 50 per cent. to meet the costs of improved water quality—and that was before the Government announced their new timetable for improvement works and £3 billion of increased debts for the water plcs to take on board.
  The Government say that they are environmentally aware and point to the National Rivers Authority as proof of a new, responsible approach to environmental issues. It is ironic that the Government can establish such a body only when someone else will pay for it. Polluters will, rightly so, pay—and the water plcs will pay the rest: directly as their share and indirectly, through corporation tax, as the Government's share. The NRA will cost the Government nothing, so their talk of concern for the environment is cheap.
  The Government's talk of being concerned about many thousands of private home owners who unwittingly
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  bought new homes having unadopted or unadoptable sewers is also cheap. The Minister of State, Welsh Office assured me that the Government were concerned that, because of the difference in standards between current building regulations and the conditions of sewers belonging to water authorities, and the inadequate powers of local authorities to insist on section 18 agreements from developers, many householders face potentially huge bills for repairing sewers that water authorities will not adopt. There are more than 2,500 such households in one local authority area in my constituency alone.
  Before privatisation, the Government have talked about introducing new measures to prevent further problems. The Bill makes no such provisions and is a missed opportunity.
  The Government will make a major error of judgment if they go ahead with the Bill, which is ridiculous, unnecessary and expensive. As they are wrapping themselves in their new green cloak, the Government should shoulder their responsibility for restoring our water industry—once the envy of the world—to its premier position as a public utility.
  7.20 pm
  Mr. Martin M. Brandon-Bravo: Of all the privatisation measures, in the public's perception water privatisation is the most difficult to understand and accept. However, its concept is just as right, and it is as much in the long-term public interest as the denationalisations that have gone before and are still to come. British Telecom, steel, gas and so on are easily perceived as commercial enterprises that can be best run and managed in the private sector with parliamentary scrutiny exercised at arm's length, just as we do with the rest of the commercial and industrial life of this country.
  There seems to be some mysticism about water. It is looked on as life itself, which makes it seem to many a sacred trust in the hands of the public sector. I cannot see it that way. Also, it cannot be said that that sacred trust —if it be that—has been so well looked after these past years that another look and approach might not better serve the public interest.
  Before the last general election, before the Secretary of State had a chance to study the feedback on consultation, we did not have a Bill remotely as good or sound as that before the House now. I welcome the fact that my right hon. Friend the Secretary of State has realised the seriousness of the concerns expressed. I fear that much of the present worry is based on hangover impressions of the supposed Bill of the previous Parliament and has not taken into account the fundamental changes that have been made in the Bill now before us.
  Rightly, in recent years, the public have not only realised the need to address green and environmental issues but, happily, have also recognised that such issues have a cost. They may not like paying, but at least the recognition is there.
  The fundamental change in this revised Bill, which answers most, if not all, of those earlier fears and concerns, is the creation of the National Rivers Authority. Those who expressed fears sought public and parliamentary control over water resources, river management, pollution, flood and sea defences, water-based recreation, amenity and conservation. The Bill achieves that aim through the National Rivers Authority. The commercial

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  and industrial aspects of the current scene—water treatment, distribution and supply, and similar functions for sewerage, with some recreation and conservation—are being put into the company framework.
  I am sure that when the public recognise that we are privatising only that which is rightly commercial, and leaving the public sector that which is rightly left there, the Bill will have at least the same measure of support as the other, more obvious privatisation measures that have come before the House.
  Even though we have made the division of function and responsibility, there still remains for me the worry over what landholdings will transfer to the water plcs and what longer-term protection will be in place to ensure that there are no large-scale financial windfalls for the new companies that belong rightly to the public. The new companies will be valued as going commercial concerns with calculations based on return on capital with values for landand buildings at current user values.
  If a company finds that it has a few bits of land or a few buildings that it does not want and makes a few bob by selling them off, I have no objection. However, if those holdings are large, were previously in public ownership and were sold at current user value, there is real public concern about the preservation of the land for its original purpose. 1 would not want to leave it to the whim of a future planning application to protect those landholdings and, in so doing, give the new plcs a reserve pot of gold on which to draw. Surely that is not our purpose and I hope that my hon. Friend the Minister will be able to give a clear steer on that aspect of genuine disquiet.
  There are other points of public concern that we should address. However, I should like to draw the House's attention to some of the more outrageous criticisms in a recent television programme called "Open Space". It might have been fairer had the programme indicated fully that it had been produced by the anti-privatisation lobby. We would then have had the right to claim equal time on which to show the other side of the coin.
  We were treated to graphic examples of what was wrong with the current water authorities. We were told how financial starvation by successive Governments—none worse than the Labour Administration—caused collapsing mains and sewers. We were told that local authorities were allowing dreadful abuses of discharge licences without prosecuting, as they are entitled to do under the present law. We were told about unclean beaches and of rivers being downgraded from category 1 to category 4. The programme was supposed to be a justification for leaving the water industry in the public sector. If that is what happens when it is left to the whim of Government or a particular Chancellor, what is the objection to letting private capital have a go?
  An ex-senior executive of one of the water authorities complained that there would have to be a massive input of investment if we were to meet the aspirations of the public and EC directives. He said that, as a consequence of privatisation,
  "the wretched consumer will have to pay".
  I have to ask: who else? It is dishonest to argue for better standards and the enforcement of those standards and then expect the cost to be borne by others. What we consume, we must pay for and the improvements that we as parliamentarians call for in legislation must also be paid for.
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  The companies meeting the new criteria must have the right to include the cost of those imposed improvements in their charges. It follows that the new companies must have the ability under proper and tight watchdog control imposed by the Bill, to finance the measures to put right what is clearly wrong now and to charge for what we decide the public want in the way of improvements in the future. That cannot be done without a commercial margin of profit. The arguments against profit simply ignore the realities. That is what Greenpeace sought to do in that television programme. Greenpeace has a good case on the quality of life and it should not undermine it with such nonsense as sneering at profit as if it is a great evil.
  Also, it is no good for Labour Members to claim that the costs should be borne through taxation. When taxation was at an all-time high with the standard rate of income tax at 37p in the pound, investment in the water industry was being cut and cut.
  In his opening remarks my right hon. Friend the Secretary of State gave four reasons for privatisation. He spoke about the 25 per cent. of our water that already comes from private sector statutory undertakings. He spoke of less centralisation and the independence of the new bodies. He spoke also about innovation, efficiency and access to capital.
  I shall add a fifth point. In recent years, we have recognised that our state pension has no investment base. An additional or second pension must have a sound raft of gilt-edged or semi gilt-edged stock in its portfolio. My hon. Friend the Member for Cambridgeshire, South-West (Sir A. Grant) spoke of wider share ownership. I entirely support his remarks. But our major privatisations, particularly this one, will provide the blue chip investment base that should be and most certainly will be in all pension fund portfolios, giving future generations confidence in those pensions as the percentage of population of pensionable age increases over the coming years. For those reasons, it is a proper and right decision. Happily, I believe that the Government have got their priorities right.
  7.30 pm
  Mr. Nigel Spearing: For several reasons, I am pleased to follow the hon. Member for Nottingham, South (Mr. Brandon-Bravo). I agree with half of what he said and fundamentally disagree with the other half. I hope that that remark provides the basis for a good debate. The hon. Gentleman was right to be worried about the disposal of land. In London, near the Thames and on the River Lea, large areas of land are owned by the Metropolitan water board, and the Thames water authority or Thames plc might sell that land. That action must be resisted.
  The hon. Gentleman was right, too, about the National Rivers Authority. We needed it for some time. The Secretary of State's argument that it justifies the Bill is nonsense. We should have it, and we should have had it even with the present structure. There is no reason why the proposed national regulatory authority, which we should have had under a central water council or authority, should not regulate existing regional authorities. If it were to do so, many of the Secretary of State's green objectives would be secured without privatisation.
  We are discussing the privatisation of only part of what was public. As the hon. Member for Cambridgeshire,

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  South-West (Sir A. Grant) pointed out, the supply side has partly been in the private sector for some time, and it has been considerably constrained. But the disposal side has never been in the private sector. The worthy Victorians who built the system in London would not have dreamt that it ever should be. Victorian virtues said, "No public ownership of water disposal and purification." That has been the case right from the beginning. The service has been municipally owned—publicly owned—as it should be. Water disposal services and, in some respects, sewerage services are absolutely fundamental for public health, and they determine the purity of our rivers and coasts, or their non-purity as the case may be.
  Conservative Members have not understood what the privatisation of sewerage means. There are drains and sewers under every road in their constituencies. If they, including the hon. Member for Nottingham, South, vote for the Bill, they will put into potential private ownership every sewer and drain in their constituencies. I do not know whether they have thought of that. I have not seen it reported in the papers, and it has not been mentioned by Conservative Members, but that is what the Bill will permit.
  Mr. Leigh: So what?
  Mr. Spearing: "So what?" the hon. Gentleman asks. I shall explain.
  Until 1974, every drain and sewer in the land was managed by local councils and they were integrated with the management of highways and public health. Public health and sewerage go hand in hand. At the moment, many sewers are still run by elected local bodies, to which ratepayers and electors turn, but on agency terms from regional water authorities. They are owned by RWAs, but they are run under contract by district councils. Will that be the case in future?
  I asked the Secretary of State a question earlier today, and he said that he would answer the question shortly. He should do so tonight. Unless there are exclusive powers of contract, the responsibility of running sewers under our towns, cities and villages will be dispersed to private ownership. Conservative Members ask, "So what?" Sewerage is intimately concerned with public health. There might be 3,000 sewerage blockages a year in an outer London borough. Some sewerage system maps are complex and difficult. We must always bear those points in mind when considering disposal.
  I now refer to the structure that we shall have if the Bill is passed without singular amendment. I am glad that the Secretary of State is present, as I shall give way if he wishes to correct anything that I get wrong. We are to have a three-decker structure. The supply side will be partly the responsibility of statutory water companies and partly that of other water enterprises, broken up or wholly run by what was the RWA. If a body wishes, disposal contracts can be split. It is up to RWA plcs, which will initially be Crown-owned, to dispose of them as they so wish, and if they can.
  Above all—Mr. Roy Watts of Thames Water has been clear about this—there will be a regional water authority holding company, which will be the holding company for various subsidiary enterprises. Holding companies—the Secretary of State hinted at this in his opening speech—
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  will not be confined to water services. They can go abroad and they can float all sorts of enterprises because they will have the capital to do so. If there is any restriction on that, I invite the Minister, even within my 10 minutes, to tell me that I am wrong.
  If I am right RWA holding companies will become part of the national and international machine of the movement of capital moneys. They will be quoted on Tokyo, Frankfurt and New York stock exchanges. Their shares will be traded—[Interruption.] So the sewers in every Conservative Member's constituency can be owned by gentlemen in Chicago, Tokyo, or anywhere else in the world. Is that what Conservative Members are saying? The Secretary of State may be quite content for the sewerage structure of Cirencester, Tewkesbury or Lewisham to be traded on international stock exchanges and to be subject to takeover bids. He may be content to have dawn raids, for management to be booted out by some takeover body which sits, perhaps, in a South American capital city. Is that what Conservative Members are saying? Apparently, they are saying that. If that is what they are saying, the British public will not put up with it.
  I doubt whether, at the moment, the British public understand what Conservative Members are about. If they wish to intervene, I shall give way. They do not understand that that is what the Bill means, or could mean. Although bodies such as Thames Water in the south-east might be sold off to people abroad, bodies in the north-west, where things are different, might not be. That is a possibility, but it is in the hands of the Secretary of State and the chairman of RWA plcs to sell off bit by bit.
  How can profits be made? They can be made only by charges. Charges for sewerage, as distinct from water supply, will be linked to meters. It is possible that our water disposal services will be run by a patchwork of private companies whose control can be changed overnight and whose shares are quoted in Tokyo, Berlin, or Moscow. If Conservative Members will permit a flight of fancy, why not Kremlin Overseas Investments plc? That may not be too far away.
  Mr. Leigh: It is a good idea.
  Mr. Spearing: The hon. Gentleman says that it is a good idea. At least the possibility exists. The potential for damage to public health services—that is what our sewerage system is—is enormous, and beyond what the British public have understood so far.
  This Bill is not about providing fresh, pure water. It is about providing worldwide capitalist interests with yet another card that they can play on the international Monopoly board. They will be playing not only for waterworks, but for our sewers and drains which were built by our Victorian forefathers as Victorian virtues. Even they believed in public ownership, and so should we.
  7.39 pm
  Mr. Alastair Goodlad: I welcome the Bill as one of the most important advances in environmental legislation that has yet happened. The framework for quality standards and the provisions for reforming the industry will enable those who work in it to make enormous advances in building on what has been achieved hitherto. It can only be in the interests of consumers to end the present need for water authorities to compete with other public services for limited resources and to finance

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  the enormous investment needed with uninhibited access to capital markets backed by improved private sector efficiency.
  The statutory water companies supply about a quarter of consumers and I should like to deal with the effects of the Bill on those consumers, the people who work in the industry and the shareholders. By and large, these provisions should be beneficial to the companies. They will be subjected to the same forms of regulation as the privatised authorities. Their financial restrictions are to be removed in so far as that is necessary to give shareholders the same protection as they have in a Companies Act company, and they are to be given the opportunity to convert to a public limited companies. These changes are of fundamental importance to the statutory water companies. Because of their system of regulation the interested shareholders hitherto have been limited and the companies have always thought of themselves as being customer-oriented. With the removal of dividend limitation there will be a considerable culture change. The customer will remain all important, but the shareholder will become of increasing significance.
  I am most concerned that in making these historic changes the existing and future employees, shareholders, and consumers have their interests protected by the creation of a regime which allows competition with the authorities on fair and level terms. We are legislating for a unique industry in which a monopoly exists with 25 per cent. of that industry already in private hands. It would be most unfortunate if we were to disadvantage those already in the private sector by our proposals to bring the authorities into the private sector too. We must ensure that in creating the new structure and framework we do not create a situation where the authorities compete unfairly with the companies. We should do so during the passage of the legislation as there is to be no right of appeal against the licences.
  With regard to existing debts, the Bill contains a provision which would enable the Secretary of State to write off or restructure authority debt so as to enable authorities to be floated on the market. Statutory companies, on the other hand, will have to continue to bear their current debt and its consequences. I hope that my right hon. Friend will bear in mind the importance of balancing the interests of the companies with those of the authorities.
  It is likely that if large amounts of authority debt were written off the companies would be placed in a much less favourable position for capital raising than the authorities. It is all very well to argue that on conversion to plc status the authorities will have their capital structures and debt equity ratios in their own hands. There will be a period before which they will have convetred to plc status and there may be great difficulties in achieving that status.
  I hope that my right hon. Friend will be careful to ensure that there is a level playing field at all times. The same argument applies to the terms of flotation of the authorities. It is in the Government's interests that the terms on which the shares are offered fully reflect the prospects of the undertakings, but in setting the flotation terms I hope that my right hon. Friend will ensure that the authorities are not in any way disadvantaged as against the companies.
  That brings me to the question of protection from takeover bids following the flotation. In some privatisations, there have been protections from takeovers. It is
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  undesirable that the authorities should be given protection from takeovers. What is certainly true is that it is not possible to give statutory water companies protection from takeover and that to give it to the authorities would obviously put the statutory water companies at a disadvantage in seeking to defend themselves against acquisition by water authorities. If my right hon. Friend seeks to give authorities some protection against takeover, a restriction should be placed on the ability of the water authorities to acquire statutory water companies. It is inherently undesirable to fetter the market, and I should prefer to see no restrictions whatever.
  Hitherto, the authorities and companies have operated under different financial regimes, both agreed by Parliament. That has led to the authorities having high levels of self-financing and high charges while the companies have had low levels of self-financing and low charges. The system of price increase control proposed in the Bill means that unless some way can be found of enabling the companies to increase their prices to a base comparable with that of the water authorities, they will be in a much worse position to earn a return on their assets in the new environment. That would be most unfair.
  To increase prices for the purpose of achieving comparability with the authorities would be contrary to the law under which statutory water companies operate at present. It follows that a mechanism must be found through the proposed price increase formula which is currently being negotiated. There will have to be a substantial increase in the level of charges levied by the companies which is attributable to the change in form of the regulation and profit control currently operative to the price control envisaged in the Bill for the new plc environment.
  With regard to the timing of the flotation of the authorities and the possible conversion of the companies to plc status, it would be wholly unacceptable if, for whatever reason, there was a period after the authorities were floated but before the statutory water companies were brought into full regulation and could achieve plc status. An even playing field in capital raising could not exist in such circumstances. There would also be serious implications for takeover activity in such a period. Yet under the Bill a small minority of a class of stock in a statutory company could hold up the conversion to plc status for a significant period, if not frustrate it altogether.
  It is likely that the time between Royal Assent to the Bill and the flotation of the authorities will be short. There could be serious consequences if the procedures for converting the statutory companies to plc status took longer. We must consider carefully whether small minorities of classes of stockholders in statutory companies should be able to frustrate the intentions of the legislation and deny the vast majority of stockholders their rights. We should examine whether the Bill can be improved so that such stockholders are entitled to receive financial compensation only if they can be shown in some way to have been unfairly treated.
  At present, water company employees enjoy a pension scheme which was set up under the provisions of the Water Act 1973. It is proposed that, as a consequence of privatisation, that statutory basis should be removed. It seems strange that current statutory water company employees should have their pension rights so fundamentally affected by a measure which is essentially intended to bring the authorities into the private sector. If employees

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  of the electricity supply industry are to continue to have a statute-based pension scheme, it is strange that there should be a difference between the treatment of employees in the two industries. I hope that my right hon. Friend will reconsider that.
  Many of these matters can be addressed in Committee, but the House should bear them in mind, particularly as the licences will not be subject to appeal. The new plc regime will enable the industry to broaden its activities.
  Finally, I should like to mention two ancillary aspects. The first, which is of great interest to many in the industry, is Water Aid. Water Aid began in 1981 as a response to the current Water Decade but intends to carry on after the decade. Currently a million people throughout the world are getting improved water and sanitation from projects supported by Water Aid, some complete and some still under way.
  The necessity of massively improving the availability of clean water needs no repetition. Suffice it to remind the House that whereas in this country 1·2 per cent. of children die before the age of five, the figures in other countries are horrifying. In Sierra Leone, the figure is 30 per cent., in Gambia 29 per cent., in Ethiopia 25 per cent. and in India 15 per cent. The contribution of Water Aid in applying the funds raised from appeals to consumers, community groups and lotteries among water industry staff, together with overseas development agency and European funds, has been significant and something in which the industry can take pride.
  The contribution is being made in rainwater harvesting, tube wells, bore-hole pump refurbishing, sewerage systems and the like, and it means the difference between life and death for many people. Many of the organisations which have created Water Aid, whose income now approaches £2 million a year, will disappear with this legislation. Hitherto, water authorities have been unable to support water aid through their funds. Under these privatisation proposals there will be enhanced opportunities for the work of Water Aid to expand. It is a cause which means a great deal to many who work in the industry.
  Secondly, and finally, it would be open to the industry to set up a jointly owned consultancy organisation, perhaps on the lines of British Electricity International —an enormous commercial and technical success—to bring British expertise in water and sewerage management to a wider and needier world. That could be achieved on an entirely commercial basis with the assistance, where necessary, of the World bank, and European and ODA development funds. I hope that the industry will give this suggestion some consideration.
  I wish the Bill every success.
  7.49 pm
  Mr. David Hinchliffe: The Bill is the most evil measure so far brought before the House by this profoundly evil Government. It strikes at the most basic and crucial of human needs—the need for water. We have been on this slippery slope for a number of years. The passing of the Water Act 1983 was significant in removing democratic involvement in local water provision and, instead, stuffing the water authorities full of Government stooges and enabling them to meet, as they do now, in
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  secret, without the press being present. That is all part and parcel of the problems that have built up in the provision of water and the effects on our environment.
  We have seen, too, the subsequent Government directives to water authorities, such as those lowering the levels of capital spending and borrowing for investment, which has major implications for the environment and pollution. The Government set artificially high profit targets in order to ripen the industry for privatisation and the way in which financial targets, but not targets for services and standards, have been imposed on water authorities certainly worries my constituents.
  The results of those Government policies can clearly be seen. An example is the Yorkshire water authority, which I mentioned in a debate on river pollution about three weeks ago. Yorkshire Water is considered to be one of the most attractive investments for the individual entering into private ownership of water. In the past year, more than three quarters of Yorkshire Water's treatment works failed to meet EC standards, its sewerage works broke pollution inspectorate consents no fewer than 83 times, and it had 811 known breaches of consent. Alongside that must be put the fact that there has been a 40 per cent. increase in its profits, to £81·5 million. That is the contrast between what the Government are aiming for and what is really happening at local level, with the consequential effects on our environment.
  Yorkshire Water's record clearly evidences what the Bill is all about. The Secretary of State's attempt to wrap up the Bill in environmental packaging is like the emperor's new clothes. We can see straight through them and we do not like what we see.
  The idea of the National Rivers Authority was an afterthought, as the Government must concede. It was forced upon them because, with the 1986 White Paper, they were bringing in self-regulation. What absolute nonsense. It was forced on them by the EC, because it was frightened of what the extremists in the Government were proposing.
  For the Government, the Bill is all about one thing, the big "P"—profit. I shall refer to one area that has scarcely been touched on so far, the small "p"—proverty, which does not feature on the Government's agenda.
  I believe that the Bill is probably the most serious attack on the poor by the Government. Conservative Members are laughing, but the implications for low-income families are frightening. In Yorkshire, within the past three years, there has been a twentyfold increase in disconnections. Last year, 560 families had their water cut off. If Conservative Members find that amusing I feel very sad, because the families concerned did not.
  That has not happened only in the north of England. For example, in Bath, in the area of Wessex Water, 35 families were cut off in one day in September including a family with five children—one of them an eight-week-old baby—and a pensioner with a 17-year medical history of depression. That is the reality of what is happening in the water industry, and the situation will clearly worsen under the ownership of private companies.
  Gordon Jones, the chairman of the Yorkshire water authority, who also chairs the national body of water authorities, said:
  "Water bills to double to an average of £200 per annum by 1993."

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  That is under private ownership. The fact is that the 7,000 cut-offs last year will be nothing compared to the number that will be cut off under private ownership, which worries me.
  What will happen to the huge numbers of people on low incomes, who need more water than most, when we have metering, which we surely will shortly after the Bill is passed? What will happen to low-paid industrial workers who, as my father did, come home in their muck and need to use a lot of water at home after carrying out a dirty job? What about those who before April would have had an automatic benefit increase when water rates were increased? What about the 50,000 sick and disabled who receive extra money for laundry and bath costs because of their individual problems? What about the 73,000 one-parent families who previously received assistance? What about the 139,000 pensioners, and the others of the 400,000 people, who received help before it was stopped by the Government?
  As I know from being involved in social services work for many years, it is bad enough to be without heating and lighting, as many families sadly are—living with calor gas and candles is no fun and to see children living in that environment is deeply worrying—but how will those people manage when they do not have water?
  I am sorry that the Secretary of State and the Minister have left. I wonder whether the Secretary of State or the Minister have had young children or have cared for them. Are they aware that babies and young children occasionally soil themselves and need regular baths? Have they ever been concerned with looking after an incontinent disabled or elderly relative, who has needed regular bathing and whose clothes and bedding needed to be put in a washer several times a day? All those examples involve a large consumption of water. If Ministers had that experience they would not be proposing this legislation.
  The Bill is the ultimate in Tory complacency and callousness. It is about people washing less often, cleaning themselves less often and flushing their toilets less often. [Interruption.] That is what metering will mean. Conservative Members laugh because they do not know the realities for many people. It is about people being deprived of their right to the most basic amenity—water. It is about profit and about pollution. It is about dirt, disease and above all, about Tory dogma—free market dogma—which was dead and buried a century ago.
  7.58 pm
  Mr. Roger Knapman: The Opposition Front Bench spokesman, the hon. Member for Copeland (Dr. Cunningham) and the hon. Member for Wakefield (Mr. Hinchliffe) have both said that the Bill is about Tory dogma. Fortunately we have also heard something about Labour dogma. Public control might have something to do with it, but we are not too sure any more about public ownership.
  We have learned enough about Labour dogma, however, to know that the Labour party will be occupying the Opposition Benches for many years to come, especially since the hon. Member for Copeland has suggested that the statutory water companies are not in the private sector. That came as something of a surprise to the Minister and myself, but it will be even more of a surprise to the French water companies which have already invested several millions of pounds in those particular companies. The
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  French are now unique, because they are the first people to want, voluntarily, to invest in a British public sector concern. I believe that Opposition Members are now pro-European Socialists. Therefore, I cannot understand why it is all right in France to have private water companies, but that our services must be administered by a nanny state.
  As has been said, about 25 per cent. of the water industry is in private ownership. In my constituency, the water in one part is controlled by a water authority and in another by a water company. Housewives in Stroud high street may congregate and say, "Gosh, you are lucky, you get your water from the water authority, but I am obliged to have mine from the water company." I do not believe, however, that that is the case.
  I congratulate my right hon. Friend on substantially adopting the 1973 structure of integrated river basis management. That was a great step forward compared with the hundreds of companies that then made up the water boards. I applaud the decision to carry out the privatisation of water on substantially the same geographical basis.
  I have no objection to privatisation—I do not believe that we have enough of it.
  Mr. Allan Roberts rose—
  Mr. Knapman: No. I shall not give way, because we are restricted to 10 minutes.
  I do not believe that we have enough privatisation. We have had a long string of successful privatisation issues, including, of course, the much-quoted Jaguar. If more privatisation had taken place earlier we would not just be talking about Jaguar Cars plc, but MG Cars plc also.
  The objections to the Bill might be summarised by a reference to the briefing from the Council for the Protection of Rural England. That organisation is not run by a bashful crowd, because it says that it forced the Secretary of State to create the National Rivers Authority. I suspect that it was pushing at an already open door. Nevertheless, if the council wishes to put it like that, so be it; at least it says in its briefing:
  "The creation of the National Rivers Authority is an important and greatly desired reform. The CPRE's long-held view is that the water authorities frequently fail to reconcile their role as water and sewerage undertaker with that of water regulator".
  Quite so.
  The first concern mentioned by the CPRE relates to the viability of local authority land assets:
  "very substantial areas of unspoilt land in the countryside and towns are potentially vulnerable to new pressures".
  It does not seem to recognise the Government's record of doubling the size of the green belt in the past few years. It also seems to be unaware that, in due course, a statutory code of practice will be introduced. The water authorities are already subject to the usual planning procedures and their operations in national parks are subject to the scrutiny of the national park committee. I believe that the CPRE's fears are unfounded. If we are not careful it will soon be believed that land must be publicly owned to ensure that it is "safe". That impression is already held by a few, but I do not accept it.
  The CPRE's second concern relates to infrastructure provision and back-door development:
  "Water PLCs may use their control of water and sewerage infrastructure to influence the location and pace of new development".

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  The council must have a low opinion of local councils and councillors, who would resent any such interference. Water authorities can only advise the local authorities where the water and sewerage capacity already exists. That is the present system and it will be the system in the future.
  The third concern of the CPRE is
  "under-investment in sewerage facilities and pollution control."
  Pollution, of course, is the responsibility of the National Rivers Authority. With regard to sewerage there is, at present, more than £5 billion of collective debt. There is a massive debt and no equity. It is hardly surprising that Opposition Members approve of that because that is what they specialise in. I have a letter from the chairman of Severn-Trent Water who points out:
  "debt conversion is bound to be a significant factor … our capital structure, which at present is entirely composed of debt and no equity, already requires the payment of some £90 million per annum in interest".
  The fourth concern of the CPRE is the lack of commitment and control of agricultural pollution. Unfortunately for the council, that fear was put in print just before the announcement from my right hon. Friend the Minister of Agriculture, Fisheries and Food that he would remedy the situation and change the system of grant.
  Over-abstraction of water is another CPRE concern. We are having metering tests in certain areas and no doubt that will be the subject of a contentious debate in due course. It is precisely the investment from private sources that will help to replace pipes in some areas where substantial leaks already occur. That is the best solution to the problem of the over-abstraction of water.
  The most substantial benefit for the industry must be the creation of strong regional companies with a strong regional identity. There is a common thread between the privatisation of the water supply industry, the electricity supply industry and, in due course, the privatisation of, I hope, British Rail, on a regional basis. As a result of the water privatisation, we shall have 10 companies spread around the country and the privatisation of electricity will create 12 new companies. I hope that when British Rail is privatised, four or five more companies are created. All those companies will help to cure one problem about which I constantly hear in my constituency—the feeling that too much wealth and too much influence has gone to the south-east and especially to London.
  I believe that strong regional companies will help to redress that balance. I support the Bill and congratulate my right hon. Friend on the way in which he has put it across.
  8.6 pm
  Mr. Jimmy Wray: Nobody is fooled by the Bill, which is a national disgrace. The robbers of our national resources are sitting on the Conservative Benches. I would not like to be left in the desert with a pail of water and the Conservatives. We know exactly what would happen.
  It is clear to me that no Government would sell for nothing a resource with assets worth £27 billion, 435,000 acres of prime land and an income in 1987–88 of £3 billion
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  gross with a profit of £740 million. Those assets and income are the reason why the Government want to privatise the industry.
  Who are the big buyers? The hon. Member for Stroud (Mr. Knapman) has already said that the French are investing, but what are they investing? Three French companies have already started to invest before the Bill becomes an Act. Générale has already bid £57 million for two of the regional water authorities. Of the 29 private companies in the statutory sector, it has invested in 10.
  Lyonnaise has made a £67 million bid for Essex and East Anglian water companies plus £60 million for the Newcastle and Gateshead and Sunderland and South Shields water companies. SAUR has invested in a joint venture with Trafalgar House. That investment tells a story. If those companies were really interested on British consumers, why have they sold two of the four London companies that they bought not long ago to Générale at a handsome profit? They have agreed to offer another bid of £68 million for three more water companies.
  The hon. Member for Cambridgeshire, South-West (Sir A. Grant) asked what a Labour Government would do. We shall nationalise the water industry and the gas industry. Anything that has been privatised by the Government will be returned to those to whom it belongs.
  The Council for the Preservation of Rural England represents those people with the most experience of the land and it is worried about the Bill. It knows that the private developer will rape the unspoiled landscape of the Welsh valleys and sell out for profit. The National Rivers Authority will have less power than the IRA by the time the private companies have finished with it. They will use the back door methods and the way in which they will do that can be seen when one looks closely at the Bill. They will set up subsidiary companies to which to transfer the land and then sell them off.
  The Central Council of Physical Recreation is also worried about the Bill. Clause 7 says that the Water Bill places a duty on every relevant body. Clause 7(6) defines "relevant body" as the National Rivers Authority, a water undertaker, a sewerage undertaker or an internal drainage board. It says nothing about subsidiary bodies. That is the loophole that the private companies will use.
  The protection of public rights of access is further eroded in clause 7(5), which gives the National Rivers Authority and private water companies an overriding power to charge. That is what this is all about. People will have to pay to go to every park and golf course. All the luxuries of the beautiful rivers and parks will be for the rich—for those who can afford them for themselves and their children.
  I hope that the Central Council of Physical Recreation will be consulted on the environmental and recreational code of practice. It is worried about the lack of consultation so far and it wants to discuss clause 9.
  Another organisation. and one dear to my heart is the National Anti-fluoridation Campaign, which is worried about the standard of drinking water and who will be responsible for it. We now realise why the Government had a large majority when it decided to fluoridate the public water supply. It knew that in two or three years' time a few bucks would be made and that Fisons would be breathing down the necks of the private companies to pollute the water with fluoride. What answers can we give that society about fluorocylisic acid and its dangers and diseases such as skeletal fluorosis, dental fluorosis and

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  chronic fluorine poisoning? Who will be the underwriter? Who will indemnify the consumer? The Bill says nothing about that.
  We recently read in the newspapers of the danger of cancer from London's drinking water and from polycylic aromatic hydrocarbon. Cleaning up would cost £1 billion and who will pay for that—the taxpayer? Nobody wants to privatise the non-profit-making side of water, so we shall end up with the bill.
  The Consumers Association is worried that the Director General of Water Services has insufficient power. The association is worried about the consumer. The Government have proposed a staff of 80, which also includes the support staff for the customer service commmittee. That is not sufficient to enable the director general to investigate consumers' complaints.
  We are worried about the monitoring of pollution in public water supplies. The director general will give that work to private enterprise and we do not trust private enterprise to do the job properly.
  The Bill should end where is belongs—in the dustbin. It is a thieves' charter. It allows the nation's resources to be stolen.
  8.16 pm
  Mr. Keith Raffan: It would not be surprising if, after the over-the-top speech to which we have just been treated by the hon. Member for Glasgow, Provan (Mr. Wray), Glasgow, Provan goes down the drain and joins Glasgow, Govan at the next general election.
  Water, as one may have gathered from the debate, is a highly political and contentious issue in Wales. I am glad to see that colleagues from the Principality are present. In the Principality we sometimes describe it as a "burning" issue.
  The work of the Select Committee on Welsh Affairs in the 1979–83 Parliament was dominated by a two-and-a-half-year inquiry into water in Wales. Water also played a significant part in the Committee's work during the last Parliament when we undertook an inquiry into coastal sewage pollution in Wales.
  During that inquiry in December 1984, following a discussion on the Welsh water authority's capital programme, I asked the chairman:
  "Perhaps you would rather be in the position of a private company so that you would then be able to borrow according to your needs?"
  Mr. John Elfed Jones, the chairman of the Welsh water authority, replied:
  "The proposition has immediate appeal."
  The water industry has for far too long been prevented from raising capital to meet heavy capital expenditure programmes to improve the quality of water and sewage treatment. Privatisation will free the water authorities from the constraint of the Government's external financing limit, enabling them to borrow more money as required, so that they will be able to accelerate their capital programmes.
  That is particularly important for the Welsh water authority. It has the longest coastline of any water authority in the country—1,300 km. It has 130 sea outfalls discharging into coastal waters—over 25 per cent. of the total in England and Wales. Of those 130, only 42 are deemed satisfactory. Only 6 per cent. of them are under 10
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  years old—these figures are well known to hon. Members from Wales—75 per cent. are over 20 years old and 40 per cent. are over 40 years old.
  The virtue of the infrastructure that the water authorities are now providing is its longevity. There is an ongoing benefit of 50 to 100 years from the capital expenditure undertaken. Therefore, there is a strong argument that they should be able to borrow more. Privatisation will allow them to do so.
  Government interference and constraints are not limited to finance. The water authorities are not allowed to engage in profitable business activity unless it is incidental to their main statutory responsibilities. As my right hon. Friend said when opening the debate—other hon. Friends have also mentioned it since—the French water companies have diversified and developed new lines of profit. They have diversified into communications, construction, waste disposal, supplying water internationally, industrial heating, leisure, health services and even funeral services. They have developed worldwide interests in North America, Africa and the far east.
  Privatisation will give the water authorities commercial freedom and allow them to exploit commercially their skills, expertise and experience. In that regard, the Welsh water authority has nothing to fear. It is the only authority with a tidal waters unit, and one of only two with a virological laboratory. It has also developed several computer software packages.
  Privatisation will lead to a new approach based on an imaginative enterprise culture, rather than a stagnant, stale public sector culture such as the present one. There is tremendous scope for international consultancy, especially in the United States, where the water industry is so fragmented. There is scope for international water contracts, and for more local services, particularly in leisure.
  Water authorities must think more commercially about property and about freeing surplus assets. What is so wrong about that? Assets such as old sewage works on the edges of towns may allow houses to be built which might otherwise have to go up in greenbelt areas. Water authorities should also make their remaining assets work harder. Before 1974 the water authorities were responsible for monitoring pollution and the district councils' predecessors were largely responsible for sewage discharges. After reorganisation, the water authorities became responsible for both roles. That prompted the 10th report of the Royal Commission on environmental pollution, which was recently echoed by the Environment Select Committee, to say that water authorities were becoming poachers as well as gamekeepers.
  When the committee of Welsh district councils gave evidence to the Select Committee on Welsh Affairs during the coastal sewage pollution inquiry, it called for an independent authority to assess the discharges that were taking place. That is precisely what the Government are providing by setting up the NRA to take over water authorities' regulatory functions.
  One of the great fallacies of public ownership is the assumption that because an industry is nationalised it will automatically look after the public interest. Labour cuts in the middle of the last decade gave the lie to that. Capital spending in Wales in 1976–77 by the Welsh water authority was £32·9 million. The then Labour Government had to crawl, humiliated, to the IMF, and the hon. Member for Alyn and Deeside (Mr. Jones), who was a member of that

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  Government, tried pathetically to apologise for their bankruptcy in the Welsh Grand Committee and the House.
  By 1987–88, the water authorities' spending had risen to £67·8 million. That is the difference between Labour "caring" and our action, which is action for the people to ensure that they have a clean water supply and that sewage is treated properly. As my right hon. Friend the Secretary of State said, we are making up for the neglect of the last Labour Government—
  Mr. Elliot Morley: Will the hon. Gentleman give way?
  Mr. Raffan: I have no time.
  There will be competition under privatisation—competition for investment funds and competition between water companies to prove which is best. Whatever it may be called—competition by comparison or yardstick competition—it is still competition. Privatisation will achieve an efficient balance between controls and incentives. All the Opposition scares are given the lie by the 29 privately owned statutory water companies, which are both efficient and safe.
  The Opposition have indulged in scaremongering. Yet I was intrigued to read in the newsletter put out by Wrexham Water, one of the 29 companies, the following item:
  "Praise from MPs … Three Clwyd MPs"—
  all of them Labour and one of them a Front-Bench spokesman—
  "praised Wrexham Water Company for the work it does in maintaining the quality and safety of its water supplies to customers."
  If privately owned statutory water companies can be efficient and safe, why cannot the new plcs? If Labour Members are satisfied with the present private water companies, why can they not be satisfied by the highly regulated new water plcs?
  Accelerated capital programmes, greater environmental protection under the NRA, and more commercially minded entrepreneurial water authorities are all sufficient reasons for Conservative—indeed, all sensible—Members strongly to support water privatisation. Nationalisation never served the consumer well, especially under the Labour party, which slashed expenditure on capital programmes for water infrastructure when in power. Privatisation will serve the customers of Britain and of Wales much better.
  8.26 pm
  Mr. Andrew F. Bennett: I was interested to note that the hon. Member for Delyn (Mr. Raffan) did not answer the question of how far the Bill would help to allay the continuing resentment in parts of north Wales about the way in which certain communities were destroyed by drowning their valleys to provide water for the big English cities. The Bill will increase the resentment of many of those communities. Now their homelands will be used not only to provide water but to provide profits. I should have liked to hear how the hon. Member for Delyn would avoid fuelling that resentment.
  I am a little disappointed, Madam Deputy Speaker, to see you in the Chair; I had hoped to see the Chairman of Ways and Means because I wanted to remind him that as
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  a youngster he larked about around the Audenshaw reservoirs in my constituency. The reservoirs there were a monument to the municipal enterprise of Manchester, which developed them and went on to create reservoirs in Longendale at the turn of the century and, just before the second world war, the reservoirs in the Lake district. The other cities and towns around Manchester also developed a series of municipal water undertakings, all of them a monument to the public-spirited investment of local authorities of that time. They provided high quality pure water for the cities and towns.
  Interestingly, those water supplies have lasted well as good investments, but they would not have offered the short-term return that private companies want. Their returns have come in over a long time. In most of those cities, the pure water supply is far better than the sewerage systems, many of which were provided by the local builders who put up the houses. They went for the cheapest systems that they could find and the systems are now in a sorry state because the builders did not share the enthusiasm for long-term investment as opposed to short-term profit.
  I also note that the water undertakings in those big cities protected large parts of the Pennines and Lake district from being built over, and from factories and pollution. It is regrettable that the water authorities did not open up the land sooner to public access for recreation and enjoyment. I understand the problems: at one stage the water was collected and had to be kept as pure as possible because there were no treatment works. Now, in the north-west particularly, and in other parts of the country, the water undertakings protect large tracts of land. About 150,000 acres in the north-west are held by the North West water authority; half of those acres are in areas of outstanding natural beauty or national parks. A considerable number of recreational amenities in the north-west are provided by the water authority. There are many permissive footpaths, picnic areas, viewing points, and so on.
  In the Peak district, about 15 per cent. of the national park is held by the water authority. Around Thirlmere about 10,000 acres of land are held by it and the same pattern applies in Wales around the reservoirs of Brenig, Elan valley and Lake Vyrnwy. The Countryside Commission—I remind the Minister that it is a Government body—is concerned, as are a large number of voluntary bodies, that areas which have been protected by water undertakings will no longer be protected.
  Some hon. Members have spoken about whether we will suffer through intensive agricultural use of the land. I am not sure how much will be intensively cultivated, but I am sure that there will be increasing pressure to afforest much of the land and that much effort will be devoted to getting the trees to grow as quickly as possible. We have seen the indiscriminate use of fertiliser from the air in many afforested areas. If the profit motive enters into the management of the land, it may be spoiled for public enjoyment.
  There will also be pressure to create money-making recreational areas. It is difficult in such areas to separate the recreational demands, but it is likely that the profit-making activities will be high on the list. There will also be pressures to reduce conservation and access. I am worried about clause 7 and I would like the Minister to give a clear undertaking that the Government do not

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  intend to reduce access to areas now owned by water authorities. Perhaps he will explain the meaning of the following words in clause 7(2)(a):
  "to have regard to the desirability".
  We should insist on something much stronger to preserve public rights of way and guarantee access to woodlands, mountains, moor, heath, down, cliff and foreshore. The Bill should not use the wavy word "desirability".
  The Bill puts charges in the negative and says that there will be no requirement to provide items free of charge. When I intervened on the Minister he said that there was no intention to impose charges. He should put on the face of the Bill that there will be no charge for the things that are presently provided. As soon as the profit motive is introduced, there will be a temptation for companies to charge for all sorts of things, and without payment, access to the countryside may be reduced. If the fears expressed by ramblers and members of other organisations are totally unfounded, it would be simple for the Minister to say that an amendment will be made at the earliest possible moment to make it clear that there will be no charges and no restrictions on access. From the way that the Bill is worded, I fear that that will not be the case.
  When I was a youngster, walkers and climbers resented the water authorities which kept people off their land. I should not like to see that conflict returning to the countryside around Greater Manchester in which I walk and climb. It will be a sad day if that happens. At one time when people saw notices saying "Keep out" and were told by the water bailiffs that they were not allowed to walk over certain areas, they took it out on the water authority. They did not stage grand demonstrations, but they showed their resentment of the water authority in what were perhaps silly and petty ways. When I was a kid I was often turned off rock climbing areas by water bailiffs, but as soon as the bailiff's back was turned we returned and made defiant gestures which certainly did not help the purity of the water supply.
  That sort of resentment could easily return to such areas if the new water authorities start to restrict access. I know that they will not do that on a grand scale to start with, but there will be a little erosion here and there. We shall see the removal of the traditional right for people to walk over an area although such an area is not a public footpath. The Minister should get rid of those areas of doubt at the earliest opportunity. He should give an undertaking that there will be no powers in the Bill to allow the new companies to charge for access to their land and that people can continue to use such land for recreation. The Government should say that they will not allow those bodies to restrict access to areas that people have traditionally used and should make it clear that they want to see an expansion of access to water authority land for recreation.
  In our crowded country we need to use every available bit of land for recreation. To have people making profits out of such land is totally wrong. I agree with my hon. Friend the Member for Newham, South (Mr. Spearing), who spoke about what might happen if water companies speculate in international markets. Who will be responsible for sewer rats? Are they to be bought and sold? That could be a major problem, because if people are making profits out of their management there will be a temptation to take short cuts and someone else will be left with the problems. We know that many problems are developing because of decaying sewerage systems. The
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  Minister should make sure that the water companies do not take the profit and leave the local authorities and public health authorities to deal with the problems.
  8.36 pm
  Mr. Dudley Fishburn: Perhaps it is because I am a new boy in the House that I often find that it is Opposition speeches which convince me most about the correctness of the policy pursued by the Government. That has never been truer than on this occasion, given the content of the speech by the hon. Member for Copeland (Dr. Cunningham) on the Opposition Front Bench. He made four points, all of which are splendidly wrong. The first was that because water is a public and universal commodity it should be publicly controlled and supplied. It is precisely because it is so universal a commodity that it should be privately and competitively controlled and supplied.
  There is a case for a Government seeking to control something that is unique or rare, which comes into the country only at great cost and difficulty to the Government. However, there is no case for a Government to seek to control the supply of so natural a commodity as water. The Roman Senate once tried to control the monopoly supply of glass. The policy was not very effective, but at least it had more logic to it than the policy put forward by the Opposition to control the supply of water.
  The second argument advanced by the Opposition is that water is unique in that it is important for the health and well-being of the community—and therefore also should be controlled by the Government. I agree that water is unique in so far as it is essential for the health and welfare of our people. It is for that very reason that its supply should not be under the control of a monopoly. One has only to have a slight sense of history to remember the appalling decision by this House a generation ago to seek control of the supply of salt, a vital commodity in India, and then to tax it. The great Mahatma Gandhi then led his famous march to the Indian ocean to privatise salt by scooping it up with his own hand away from Government control.
  The third Opposition argument was that profit was somehow inherently wrong. How does the hon. Member for Copeland wish our water undertakings to be run? Are they to incur a loss or are they to break even? Does he not realise that a loss by a Government monopoly is a subsidy paid for by a tax on somebody else's profit? When the water undertakings are privatised and are public limited companies, we shall see them making profits, and the Government will reap the benefit in corporation tax. That will be more money to the Exchequer than even the most rapacious Opposition Members could wish for. Nearly £22 billion has been reaped into the coffers of the Exchequer from companies that have been privatised since 1979.
  The hon. Member for Copeland argued that the water industry should remain a public monopoly. He conveyed the feeling that somehow the Government should control the water industry and that the man who sits on the Government Front Bench should be the controller and chief executive of one of Britain's great industries. We well remember Conservative and Labour Governments interfering with British Steel, repeatedly making political judgments, which did so much harm to the company in the 1960s and 1970s.

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  I have great respect for my hon. and learned Friend the Minister for Water and Planning. He is a distinguished barrister, a distinguished parliamentarian and, not least, a distinguished resident of my constituency. He does not have among his skills, nor would he say that he did, the ability to be chief executive of the country's water undertakings. The quicker he talks himself out of that job— I am delighted that he will be doing so over the coming months—the better it will be for us all.
  Finally, we heard about the Opposition's discovery of open spaces and nature. The hon. Member for Copeland quoted, in a hackneyed way, Shakespeare and Wordsworth. It says something of the self-importance of politicians that they do not turn to Evelyn Waugh on such occasions. The great naturalist, Scoop, recalled how
  "feather-footed through the plashy fen passes the questing vole."
  Perhaps these days it should read "passes the quest for votes".
  A bucolic charm has come into this water debate. But I come from an inner-city area, through which no sylvan waters flow. The Kensal canal inks its way along the border of my constituency as a demilitarised zone between the hon. Member for Brent, South (Mr. Boateng) and the Socialist republic of that borough. Yet we, who live in tower and mansion blocks, have as great an interest in clean and pure water being cheaply delivered to our community.
  We are delighted with the increased efficiency of Thames Water as it moves to privatisation. As it does so, we shall have a company that we know about; that we can go along and kick; that as hon. Members we can lobby to ensure not least that those who cannot afford water do not have it cut off; and to make it part of our community. When Thames Water is floated on the stock market, one of the first things that I will do is to request that it supports another float—a float in my constituency's famous Notting Hill carnival.
  8.42 pm
  Mr. Clifford Forsythe: At one time I might have had to declare an interest because I used to be a plumbing contractor. Perhaps the House will forgive me, therefore, if I speak in practical terms.
  Having listened to Conservative Members, the logic of giving a public utility to private companies escapes me. It is a sad reflection on the Secretary of State and the Department of the Environment that they believe that by transferring public utilities to private companies they will be able to make a profit. Why could not the Government get the economics of the public utilities right, and therefore give money to the Exchequer? If the private companies make a profit, they will do so at a cost to some of their other operations.
  As a former plumber, I wonder from where the competition will come. Water mains and service pipes are already in place underground. Will there be different coloured water to show that it is coming from different firms? Will the private companies build new reservoirs or fit new water mains? There will be no competition if there is only one set of water pipes.
  It is at least heartening that a number of restrictions will be placed on the private companies. From a practical point
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  of view, they will need to be tightly controlled. It is also heartening to know that on 1 January 1989 the model byelaws will be implemented by the Government.
  Many new plumbing operations will be introduced. It has been suggested that there will be no more storage tanks and that the single-pipe system will be supplied off the mains. If a private company's water main bursts and is losing a lot of water, what will happen if it decides, to guard its profits, to turn off the water mains to prevent an even more serious leak, leaving householders without water? That possibility must be considered carefully and seriously.
  Plumbing contractors in Northern Ireland formerly came under the control of the Belfast water commissioners. All plumbers working under its auspices had to be licensed. If a plumber did not have a licence he could not work on the water supply. It amazes me that that is not the case in the rest of Britain. There is no compulsory list of plumbers, so private companies supplying water will be entitled to employ anybody to fit plumbing. If there is no compulsory list of plumbers who can show that they know what they are doing, many of the problems of the past will become worse in the future.
  Mr. Ashby: Is the hon. Gentleman aware that the Bill does not apply to Northern Ireland?
  Mr. Forsythe: I am entitled, as an hon. Member, to speak. [Interruption.]
  Mr. Ashby: I do not want to discuss the matter; I merely felt that the hon. Gentleman might be reassured by that knowledge.
  Mr. Allan Roberts: On a point of order, Madam Deputy Speaker. The Government have said that they intend to introduce these measures in Northern Ireland.
  Madam Deputy Speaker (Miss Betty Boothroyd): The hon. Member for Antrim, South (Mr. Forsythe) is perfectly in order to speak on the Bill. He is an hon. Member of the House.
  Mr. Forsythe: I am most disappointed, in this democratic House, that an hon. Member should question another hon. Member's right to speak.
  I was saying that there must be a compulsory register of plumbers or those entitled to work on water undertakings. To put the matter in context, I ask the Minister to give the meaning of clause 180(5), which says:
  "This section and the following provisions of this Act shall extend to the whole of the United Kingdom, namely—

  (a) Schedules 2 and 5 and sections 3, 11 and 22 so far as relating to any scheme under either of those Schedules;

  (b) Section 88; and

  (c) any amendment or repeal by this Act of any provision contained in the Parliamentary Commissioner Act 1967, the House of Commons Disqualification Act 1975 or the Northern Ireland Assembly Disqualification Act 1975."

  8.49 Pm
  Mr. Henry Bellingham: It is a pleasure to follow the hon. Member for Antrim, South (Mr. Forsythe), not least because my party is the Conservative and Unionist party. We should applaud the fact that the hon. Members for Antrim, East (Mr. Beggs)

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  and for Londonderry, East (Mr. Ross) are listening to and participating in the debate. I hope that they will join us in the Division Lobby tomorrow night to support the Bill.
  The Bill has given rise to great interest in west Norfolk, not least because it is the land of Vermuiden. Much of my constituency is land that was reclaimed in the 17th century and drained. Much of it is below sea level, so coastal and sea defence aspects are important. My constituency is dominated by the River Ouse, which has many tributaries. It is part of a large river basin which will form the key to the new local companies.
  Originally, there was some suspicion about the water privatisation proposals. My constituents were under the impression that crucial functions, such as coastal drainage, coastal defence and water pollution control, would be part of the functions of the plcs and were afraid that there would be a conflict of interests. That is why I welcome the Government's moves to separate the two functions, to set up the National Rivers Authority and to take out that part of the industry that can be profitable and sold to the public and to put the other into a new framework. I find that there is now broad support for the Bill and great support for the NRA.
  It is interesting that most, if not all, of those groups and bodies that Opposition Members have cited as opposing the Bill have welcomed the creation of the NRA. This is a move in the right direction. Pollution control is far from perfect. My hon. Friend the Member for Hornsey and Wood Green (Sir H. Rossi) said that 20 per cent. of the sewage plants breach the discharge consents laid down by the Department of the Environment. That is a disgrace. The number of reported pollution incidents has increased from 12,000 in 1982 to 23,000. In 1986 there were only 250 prosecutions. The penalties are far too low.
  We have heard about fishing. I understand that the eels caught in 31 rivers were so contaminated by pesticides that they could not be eaten by anyone. My right hon. Friend the Secretary of State is a keen fisherman and is concerned about river pollution and angling. Some rivers are a disgrace. Obviously, the Control of Pollution Act 1974 is not working. If the NRA is to work, it must have sufficient funding and staff, and have deadlines to which to work.
  I am slightly worried about sea defences. Under existing arrangements, borrowing powers can be assumed in a low rateable area. I hope that my hon. Friend the Minister will address himself to this point. What will happen under the new arrangements? We have heard much about the greenhouse effect. If the sea level increases by 2 ft or 3 ft, my constituency will disappear.
  Mr. Paul Boateng: That is the best argument that the hon. Gentleman has made all night.
  Mr. Bellingham: The hon. Gentleman is being unfair. Those psychedelic socks of his are putting me off.
  Most of my constituency would disappear, as would a great deal of the Queen's estate at Sandringham. Water would lap up the front door at Sandringham. That would be a disaster. That is why we must get our sea and tidal defences right. I hope that my hon. Friend the Minister will address himself to those important points. The NRA can work. I hope that those powers vested in the Secretary of State under the Control of Pollution Act will be vested also in the NRA.
  We have a long way to go, but separating these two functions is a crucial move in the right direction. I urge the
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  Government to adopt a more radical stance and to consider the new structure carefully. Her Majesty's inspectorate of pollution is to be restructured and put on a regional basis. There is a strong argument for a new, integrated, pollution control structure. This would mean creating a body along the lines of the United States Environmental Protection Agency. We could have a national EPA, but one with regional centres which would be advised by not only the NRA but by that part of HMIP that deals with air pollution and toxic waste.
  The waste disposal authorities would be integrated into the regional centres. The WDAs have not served this country well. Many have refused to file reports to HMIP. Many are not properly funded, which may be partly the Government's fault. This is an opportunity to set up a more radical structure, whereby functions such as air pollution control and waste disposal are under one roof on a regional basis. I hope that my hon. Friend the Minister will comment on that suggestion.
  Surely, with HMIP being restructured and the WDAs, which are part of local authorities, coming under increased pressure and criticism, the time has come to take these functions from local authorities and give them to regional organisations. That will leave local authorities free to concentrate on planning and on vetting planning applications.
  The new water authorities will have control over the licensing of new waste disposal facilities and will be able to say whether sites may go ahead. They will be able to impose a veto if they are worried about leachates or geological factors. Why not give them more say and control and take that function from the WDAs? Local authorities will be able to concentrate on what they are best at doing—imposing planning controls and considering planning aspects. I hope that my hon. Friend the Minister will take those points on board and put them to our right hon. Friend the Secretary of State. I hope to be a member of the Standing Committee, where there will be opportunities for us to pursue those points. A number of Opposition Members feel equally strongly that this opportunity to introduce an integrated approach is not to be missed.
  I well remember that every time I met the chairman of Anglian Water, Mr. Bernard Henderson, CBE, he said, "We are hamstrung by Treasury controls. Every time we want to invest, we cannot. We have a negative external financing limit. When we want to borrow money for new investment or to put money into new infrastructure and plant, we cannot. When we can, we are hidebound in terms of how much we can borrow and the extent of our capital expenditure." He, among many other water authority chairmen, may welcome water privatisation and these new privatised plcs being let off the leash and able to serve the public as they want by spending sufficient funds on capital investment and, at the same time, not having to worry about some of the other functions that will rightly remain in the public domain.
  I support the Bill because it represents an excellent way forward and a unique step during the Government's tenure in making major progress on the environmental front and, above all, in presenting to the public a better service and a cleaner environment.
  8.58 pm
  Mr. Dafydd Wigley: I agree very much with the hon. Member for Norfolk, North-West (Mr. Bellingham) about the need for a regional, co-ordinated structure. My real fear for Wales—although we look on Wales as a national unit, we regard it in regional terms from an organisational point of view—is that the rivers authority will impose centralisation. We shall lose the river functions that exist on an all-Wales basis and we are far from happy that there are sufficient provisions in the Bill to deal satisfactorily with rivers in Wales.
  The hon. Member for Norfolk, North-West spoke of obtaining more capital, but whether the plcs concerned will be able to afford to attract that capital and at what price will be central to the argument. The hon. Member for Delyn (Mr. Raffan) said that water was a burning issue in Wales. It certainly is and, many years before he came and graced our presence in Wales, we had a very difficult time there.
  The hon. Member for Denton and Reddish (Mr. Bennett) mentioned the considerable controversy involving cities such as Liverpool and Birmingham which took over valleys in Wales to provide reservoirs, as a result of which people were moved out. Legislation was enacted in Parliament, against the united opposition of all Welsh Members, across party lines, but there was still considerable controversy. In the 1960s, there were episodes of water pipelines being blown up. That was a difficult time.
  It is difficult to imagine how much change there has been in perception and understanding since that time. Although Members on both sides of the House will criticise the Welsh water authority from time to time—no doubt there are times when they are right to do so—over the intervening two decades new harmony and planning has come about in the provision of one of the most basic services of the community—the provision of water, including sewerage, flood control and pollution control.
  I fear that we are now moving backwards, not to Victorian times but to a pre-Victorian time. One of the first most exciting steps in municipal development was the provision of water and sewerage services in some of our large cities. I am gravely concerned about the effect of the Bill in Wales. The balance sheet of the Welsh water authority shows that the current cost net asset value is about £2,000 million and the turnover is about £223 million. If we wanted to obtain a return of 10 per cent. on that £2,000 million in the market place, we should be looking for £200 million profit. In other words, we should be looking to increase the turnover from £223 million to about £423 million, which represents a doubling of the total charges. Clearly, that is not on and I am not suggesting that charges will increase by that much, although I have real fears that they are bound to go up a considerable amount.
  If the charges do not go up by that much, the assets of the water authorities, which have a book value of just under £2,000 million, will be sold off for a fraction of that sum. If I understand the position correctly, the Welsh Office is looking for a figure of £250 million to £300 million for those assets. That is one sixth or one seventh of their book value. That is giving away public assets which have been paid for by the water ratepayers of Wales. On what grounds can that be justified?
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  It may be possible to have a write-off which makes it practical to appear to have a reasonable return. Perhaps the £27 million profit last year can be pushed up to £30 million or £40 million and a reasonable return appear on the cost of the shareholding. When we look for additional capital to undertake the sewerage replacement works and all the other works that are needed, there will be no write-up or grant provision. The system will have to stand on its own two feet. That is where the valid comparison comes in for a return on the £2,000 million equivalent that we are now discussing. However, if we dress this up for a one-off sale, to justify increased capital in the future—that is the argument advanced by Conservative Members in favour of privatisation, and I accept the need for additional capital—there will have to be a substantially higher profit margin. That must mean higher prices, and it will hit some of the most vulnerable people very hard.
  The question of answerability and control has also led to much discussion in Wales. At present, we have a quango. I should be much happier if the Welsh water authority were answerable directly to an all-Wales elected body, but that is not on the agenda at the moment, although we are hoping to work in that direction again before too long. In the meantime, if privatisation is to take place—we are unlikely to stop it with the balance of power in this Parliament—what safeguard can be provided to ensure that water consumers in Wales have a dominant part of the equity capital? This issue was raised by the hon. Member for Brecon and Radnor (Mr. Livsey). I understand that the Welsh Office, with the Welsh water authority and institutional investors, has been considering various options.
  Mr. Leigh: Will the hon. Gentleman give way?
  Mr. Wigley: No, I shall not give way as there is a 10-minute limit on speeches.
  Perhaps 60 per cent. of the equity shareholding could be in the form of A shares and designated for consumers. I and others are worried that after consumers have bought the initial share-out the shares will pass into the hands of institutional investors. We know that the television company for which the Minister of State, Welsh Office, formerly worked—HTV—introduced share restrictions to ensure that the shareholding reflected tight control of the company so that the company could maintain the policy which had led to its securing its franchise.
  The Government should find a way of ensuring that a mechanism is found to enable consumers, even those with small incomes, to secure a share so that the overall control of Welsh water is at least indirectly in the hands of Welsh people. Is it practical and feasible—this is an issue that I raised as a member of the Welsh Grand Committee this morning, in response to which the Secretary of State indicated some sympathy—to have a form of a golden share in the Welsh Office to ensure that issues of public concern in Wales are subject to a longstop and are not determined merely by pure market considerations?
  Many bodies have made representations to us on these issues, including those representing anglers, farmers, ramblers, those with an interest in bird life, outdoor educationists and consumers. The Countryside Commission is a specific example. Welsh constituency Members are well aware of the range of problems which arise, including those associated with the water charges, cut-offs, floods, pollution, sewer replacements, inadequate

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  pipes, fish farms and coastal erosion. All these matters will have to be dealt with by the proposed new bodies. My heart tells me that an organisation that is geared to commercial profit only cannot meet the problems that we and our constituents come up against week by week and month by month.
  If I am lucky enough or unlucky enough to be a member of the Committee which considers the Bill—an enormous amount of work will face those Members—I hope that those on the Government Front Bench will be flexible in their response to practical amendments tabled to protect the interests of those who might suffer if purely commercial considerations alone are taken on board. We must not slip back into the days of contention of the 1950s and 1960s in Wales. There must be a structure which ensures that the necessary safeguards are provided.
  9.8 pm
  Mr. David Ashby: I welcome the Bill, and I think that there are many who take the same view. They are unhappy that regional authorities have not fulfilled all that was expected of them. They expect and demand higher standards, and we all recognise that those standards are required regardless of whether there is privatisation. I agree with my hon. Friend the Member for Cambridgeshire, South-West (Sir A. Grant) that fundamentally the Bill is directed to raising standards as well as privatisation. It provides for a massive raising of standards, and we must understand and accept that there is a cost to raising standards. If we are to improve the environment, we must spend more. That is a cost which I am sure we all willingly accept because we want to improve the environment and our standards.
  The Bill recognises the necessity of environmental and regulatory controls. It reflects the need for those controls to remain in the public sector. That need will be met by the National Rivers Authority and the Director General of Water Services.
  I want to speak briefly about the National Rivers Authority. The fight against the pollution of water courses too often makes the headlines only when a disaster occurs. Pollution is a chronic phenomenon and is produced by a combination of sources, as a result of our way of life. In consequence, the fight against pollution must not be limited to ad hoc measures designed to repair extensive and sometimes irreversible damage at great expense. Instead, it must take the form of long-term action to tackle the causes of pollution.
  The pollution of water courses is not caused solely by large industries. It is caused also by the citizens of this country, as consumers and producers of products, or by activities that result in that pollution. The solution must be that we consider not only sanctions, but the education of those people who are involved in activities that could pollute water courses.
  Therefore, I hope that the Minister will take on board the point that the National Rivers Authority must be able, not only to prosecute or impose sanctions, but, equally important, to raise public awareness of these problems. It must have a role in advertising and a role to educate. It must be able to put on exhibitions and to provide advisory services for those who are involved in activities that might cause pollution.
  That is the most important point that I wanted to make. I promised that I would not speak for 10 minutes and I
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  said that if I was called, I could say what I wanted to say in three or four minutes. That is the message that I wanted to put over.
  9.12 pm
  Mr. Paul Boateng: The surest sign of a poor advocate defending an even poorer case is the large number of character witnesses that are traipsed before the court as a sign of the worth of the indefensible. In the course of this debate, we have seen a number of character witnesses traipsed before our eyes in defence of the indefensible. One of those witnesses, bizarrely, was the grandfather of the hon. Member for Crawley (Mr. Soames)—that is, an early right hon. Member for Woodford, Winston Churchill. We were told that, were he alive, he would be a great supporter of water privatisation. His own knowledge of clear white liquids—like that of his distinguished grandson—was limited to those clear white liquids that are produced in vats in Warrington rather than those that descend from heaven.
  Juxtaposed even more bizarrely with the late right hon. Member for Woodford was a contemporary—none other than Mahatma Gandhi. We were told by the hon. Member for Kensington (Mr. Fishburn)—who is now in his place —that the Mahatma, were he alive, would be a supporter of water privatisation. The hon. Member for Kensington has got his gurus somewhat mixed up. The only guru of water privatisation is Professor Milton Friedman. Privatisation is a product of his philosophy and the idea that Gandhi can be prayed in aid as a supporter of this squalid little measure is complete nonsense. The point of the march to the shores that the Mahatma led was to say that salt belonged to the people. He said that salt should not be usurped by the state through the imposition of taxation.
  In opposing the Bill, root and branch, we say that water belongs to the people and should not be given away by the state for the benefit of private enterprise. We say that it belongs to the people and that the true purpose of the Bill is not the greening of England. There is nothing more ludicrous than the suggestion by the Secretary of State in the leaks and press conferences before the presentation of the Bill that it was all about protecting the environment. We were told that this is a green measure. The British people may be getting increasingly greener, but we are not so green round the gills as to believe one word of the Secretary of State's ex post facto justification for the Bill.
  The true purpose of the Bill came out clearly in the speech of the hon. Member for Cambridgeshire, South-West (Sir A. Grant). He had had enough of all this talk about the environment and he reminded everyone that the bottom line was efficiency and profits. We are glad to hear about efficiency, but it is strange to hear the hon. Gentleman talk in glowing terms about the Anglian water authority being a model for private enterprise and attractive to the French, when 35 per cent. of the Anglian authority's consented sewage treatment plants are in breach of their discharge consents. But, above all, the purpose is profit. The interests of the environment and of the consumer will be subjugated to the overwhelming interests of profit. That is the bottom line.
  The select Committee on the Environment has been prayed in aid by people who should know better—I do not include the Secretary of State in that category. In my early days as a member of that Committee, we visited a toxic

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  waste dump in the north country. A man who had been in the business for a long time put his hand on my shoulder and said, "You know, son, where there's muck there's brass." On this Bill, Conservative Members believe, "where there's water, there's dosh". The French would call it "leauds and leauds" of dosh. We must put aside this pretence about care for the environment because it does not feature on the Government's agenda.
  I am glad that the Minister for Water and Planning is in his place because I have several questions to ask him about the role and resources of the National Rivers Authority. An alarming fact that came out from the press conferences, leaks and subsequent statements was that the NRA will be subject to a Treasury regime in terms of staffing and resources. It will also be subject to Department of the Environment guidance in terms of staffing.
  We all know the Department's record in respect of those responsible for monitoring, controlling and trying to abate pollution. During the past four months, two Department inspectors have disappeared from the scene because they were so disgruntled and dissatisfied with the state of staffing and the priority given to adequate resources for the control of pollution. We are supposed to trust our rivers and our patrimony to the tender mercies of the Department of the Environment. We cannot do so. The record of the past nine years is that Conservatives are not up to the job of giving water pollution the priority it deserves.
  As to what is expected of the NRA, it is not only Greenpeace—which has wrongly been subjected to some calumny in this debate—that is concerned about the environment. It is not often that one feels compelled to call on the advice of the Country Landowners Association. Unlike the hon. Member for Norfolk, North West (Mr. Bellingham), I do not wake up in the night in a cold sweat over the interests of country landowners—perhaps I ought to. However, I am interested that the association expresses concern about the NRA's financing:
  "The Country Landowners Association is therefore strongly opposed to the provisions of the Bill which would make the NRA dependent upon Exchequer grant aid to carry out its function and which would prevent it from borrowing to finance capital works."
  That is interesting, and when the Minister responds, I hope he will answer the associations's concerns. If he is not so concerned about the views of Greenpeace or of other groups well known for their work in protecting the environment, perhaps he will answer the concern expressed by the Country Landowners Association, and that of the hon. Member for Norfolk, North-West, which I share, in relation to what will happen to our coastal defences. We do not want to see the hon. Gentleman's constituency disappear under six inches of water—at least, not in the course of this Parliament.
  We must consider also the concerns of the consumers. We have been told that this measure will benefit the consumer. To give Jack his jacket, the Secretary of State has always made it crystal clear that the consumer will have to pay for protecting the environment. There is never any question of the polluter or of those who have profited from the creation of waste having to pay. Let us take it as read that the consumer will pay, because that is entirely
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  consistent with the political philosophy of Conservative Members. Let us instead ask what protection the consumer will have under the new regime.
  The House has been told, and is entitled to clarification of this point, that there will be two parallel and separate committees charged with responsibility for protecting the consumer interests. They are the rivers advisory committee and the customer services committee. May the House be given the assurance that has also been sought by the Consumers Association and by other consumer protection bodies, that both committees will be properly resourced and funded; above all, that they will be given the requisite power for dealing with the problems that the industry has faced in ensuring that those responsible for pollution are brought to book?

  In conclusion, I ask for one further point of clarification. The Secretary of State will understand the confusion that exists in the minds of observers of the environmental scene. At one moment, the Secretary of State makes it clear that it is no part of a water authority's responsibility to impose a level of fine or to prosecute large numbers of defaulters, arguing that in such a situation, money that could be spent on improvements would be spent on implementing fines.
  On the other hand, the acceptable face of the Department of the Environment, in the form of the Secretary of State's junior Minister, tells us that it is important that there be a greater readiness to prosecute and to make more effective use of powers that already exist. Which is the true voice of the Department of the Environment? Let us hear it tonight and let it stop speaking—as we have heard it, and many Conservative Members speak tonight, and as various Ministers have over the past few months—with a forked tongue.
  9.24 pm
  Mr. Edward Leigh: I am grateful to the hon. Member for Brent, South (Mr. Boateng) for allowing me five minutes at the end of the debate in which to say few words.
  I want to say a little about the presentation of the Bill. We must be honest—even among those who are not motivated by party spite there is some concern about the provisions of the Bill. There is bound to be concern about any new aspect of legislation and it has been expressed about many privatisation measures that we have introduced. There is no doubt that, as usual, the Opposition have not attempted to use reasoned argument but have resorted to scaremongering, as my hon. Friend the Member for Pembroke (Mr. Bennett) said.
  I shall return to first principles, as I did to an audience of about 100 people in my constituency last Friday. If one looks at the present situation and what can be done about it and clears one's mind of all the alternatives, one ends up with something remarkably similar to what my right hon. Friend the Secretary of State has suggested.
  The first thing one asks when one talks to ordinary people is, "Are you satisfied with the present water industry?" Of course, the answer is no. Earlier in the debate we heard that the Labour Government cut spending in the water industry by a third. They would have liked to spend more and, if they returned to power and renationalised the industry, they would not want to cut capital spending.

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  Government language, however, is the language of priorities. It is about roads versus pensions. There are no votes in sewerage and water when compared with roads, pensions and social security. That has been the problem underlying public dissatisfaction with the water industry. We cannot deny that. Despite the fact that we have increased capital spending by half, we are still not spending enough. A village in my constituency, Claxby, has been denied an adequate sewerage scheme for 20 years. I have a sheaf of correspondence about that on my desk. My predecessor tried to deal with it and I have tried, but the buck has been passed from the local authority to the water authority and nothing has been done. The present facilities are inadequate.
  If we ask ourselves what to do about the situation, we might come forward with a simple solution. First, why not set up for the first time in our history an environmental protection agency with real teeth? Why not, for the first time, ensure that the gamekeeper is no longer employed by the poacher? That is what is being done in part III of the Bill and it is something of which we should be proud. That is a matter not of presentation but of fact.
  If we were starting from square one and asking what we could do to make privatisation work, the answer might be to create powerful, strong, regionally based water companies free from the day-to-day interference of Ministers, free to invest and attract private capital and to provide villages such as Claxby and others with adequate sewerage systems. That is contained in part I of the Bill.
  Finally, we might say that overlaying that we should ensure that we have the tightest, strongest and most closely regulated industry in the world, which will ensure that despite the monopoly that water companies must have, they will not abuse the monopoly by overcharging, discriminating against certain customers, reducing services and so on. That is all in part II of the Bill. So even if one were not motivated by dogma, as the Opposition say we are, and if one approached the matter from first principles, one might come to the House with something similar to the Bill.
  There are bound to be one or two worries. The National Anglers Council welcomes the Bill but is concerned about representation on the National Rivers Authority. I have no doubt that its concerns will be listened to. There are fears about allowing the water authorities to get on their feet. The golden share has been mentioned and there may be some mileage in that. However, while we ensure that there is a tight regulatory framework, we must remember that water is, and always has been, a business. For all our sakes we have to allow the water companies to invest in the future. They are determined to make privatisation work and I am sure that the Bill provides an excellent way forward. I give it my full support.
  9.29 pm
  Mr. Allan Roberts: The Select Committee report has been quoted at some length to illustrate that the last Labour Government cut capital expenditure on the water and sewerage industry. We accept that that is the case. However, we claim two things: first, that this Government have continued to reduce capital expenditure; secondly, the last Labour Government were in power for five years, and since then this Government have been in power 10 years. Nearly every recommendation in the Environment Select Committee's report is an
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  indictment of the Government's record over the past 10 years. We quote in aid the Select Committee's report. We recommend that greater scope should he given to water authorities to borrow commercially. In the light of the report—an all-party one—such scope does not depend on the privatisation of the water industry.
  The Bill will introduce momentous changes to the management of the water environment. Although the Government have sought to defuse the potential time bomb standing in the way of privatisation, they face major environmental controversies about sewage discharges, the quality of drinking water, and the industry's land assets. It is a 340-page monster, containing 180 clauses and 24 schedules. The Bill must receive Royal Assent next June if the flotation of water authorities, which is currently intended to be at the end of 1989, is not to interfere with the Government's plans for the sale of the electricity industry. The Government want the Bill to be pushed through with unparalleled haste. Opposition Members will not co-operate with their intention.
  In recent weeks, Government and water industry sources have insisted that an extremely tough regulatory regime will be ushered in by the Bill. However, the industry and the Government have been anxious to head off extra controls that could prejudice the chances of a successful flotation. If the National Rivers Authority is to be an effective force in improving environmental standards, it must strengthen its technical, monitoring and scientific capabilities. The National Rivers Authority already faces significant extra responsibilities, before it is properly established. I refer to the need to prepare plans to implement the decisions of last year's North sea conference and the 1990 national river quality survey, and extra monitoring of "red list" substances, all of which could rapidly erode the real value of its resources.
  The Government are yet to work out how to deal with the major threat—it is a major threat—to their privatisation proposals. Ironically, that threat is entirely home-grown. It is posed by the water authorities' own sewage treatment works. The recent public debate about such facilities involved the failure of more than 850 works —or over 20 per cent. of those with numerical discharge consents—to comply with their consent conditions.
  Illegality—and it is illegality—on that scale is a significant obstacle to flotation. Lawyers have already advised senior executives in the water industry that they must not sign prospectuses if their businesses are knowingly committing criminal offences. To date, the Government have responded in two ways. First—the Opposition welcome it—they have provided extra funds for capital investments which, according to different ministerial statements, are intended to ensure that all, or almost all, non-complying works operate within the law by October 1992. Opposition Members doubt that that can be achieved with the amount of extra capital that the Government have allocated.
  They have also said—we regret it—that non-complying works may be given interim relaxed consents to facilitate privatisation, provided that credible improvement programmes are in hand. In preparation for privatisation, more, not less, damage will be done to the environment, which gives the lie to the Government's claim.
  Organisations such as Friends of the Earth and Greenpeace are prepared to apply to the High Court to test any dubious Government decisions. Anything but a small-scale relaxation exercise would certainly drive a

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  coach and horses through the long-established principle of even-handedness, as British industry has never received relaxations for its discharges on the scale now being sought by some parts of the water industry and granted by the Government to facilitate privatisation.
  The Government's arguments pull the Bill in opposite directions. One argument is to provide firm assurances that the Bill contains genuine additional environmental safeguards, and the second argument is to convince the City that there are no destabilising uncertainties about costs attached to environmental controls. That is the Government's dilemma.
  On the first of those counts, the Government are heavily burdened by recent history. Broadly speaking, this is an enabling Bill. Many environmental clauses have to be fleshed out in regulations before they can have any practical effect. Many of the clauses characterised as new by the Secretary of State have been carried forward with some simplification or amendment from the Control of Pollution Act 1974. Developments since 1974 do not inspire confidence that the Government, with a successful flotation uppermost in their mind, will look rapidly to give effect to these provisions. The powers in that Act to introduce protection zones and to impose controls on the storage of dangerous substances have never been invoked. The Government are continuing to display little haste about introducing statutory controls on nitrogen fertiliser applications to agricultural land, using the water protection zone powers that they already have in the Control of Pollution Act. They are backsliding all over the place.
  Last year, the Department of the Environment said that the Bill would give backing for the first time to river quality objectives and provide for deadlines to be set for their achievement. But the Department also said that these would be in place when the Bill was enacted. Now the intention is not to introduce them until 1992. The conflicts are inevitable and the Government's record on the environment is clear.
  One of the Government's main arguments for privatisation is that it will release the water authorities from public sector borrowing requirement controls, but the Government are nationalising many functions of the water industry and giving them to the National Rivers Authority. That does not release water resource planning and licensing, abstracting and monitoring of licences, environmental quality and pollution control, land drainage and flood protection, the maintenance, improvement and development of fisheries and inland waters, conservation and recreation, navigational responsibilities and functions of three water authorities, the functions of Her Majesty's inspectorate of pollution, research, and flood and sea defences.
  None of those will be released from PSBR restrictions. They will be the functions of a National Rivers Authority, and that will not solve any problems. The revenue consequences of all those functions will be paid for by additional, higher charges—it says so in the Government's document—and by taxation. That is not releasing the evironmental functions of the water industry from PSBR constraints. At a stroke, and without privatisation, the Government could release the water industry from the stupid and ridiculous PSBR control.
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  We were asked whether a Labour Government would take the water industry back into public ownership. The answer is yes. We will not nationalise it. It is this Government who are doing the nationalising by setting up the NRA.
  This is absolute nonsense. Let us look at the logic of it. The same organisation, whether in public or private ownership, will borrow the same money on the market from the same people to spend on the same projects. One is bad for the nation's economy because the public sector is doing it, and the other is good for the nation's economy because the private sector is doing it. We are talking about the same money from the same sources for the same purposes. What economic nonsense. If that is the only justification for privatisation, no wonder the public have seen it for what it is—asset stripping.
  Conservative Members laughed when my hon. Friend the Member for Wakefield (Mr. Hinchliffe) spoke about poverty. They think that compulsory water metering and charging people per second per gallon per squirt is good. They do not think that an old-age pensioner will worry about the bill and will continue to flush the toilet as often as now. They do not believe that large families in the poverty trap will stop bathing their children as often as now because they will be worried about how much water they are using and their water bills.
  I would not mind if water metering saved significant sums. The lowest estimate for putting water meters into people's houses is £2 billion—others have been about £3 billion or £4 billion. Having put the meter into a house, it does not matter whether that household uses twice as much or four times less water than it was using before it had the meter, it will still cost the water authority the same to deliver it. Conservative Members do not understand that water is not the same as electricity. Electricity is expensive to produce, but cheap to distribute. Water is cheap to produce—it droppeth, as the quality of mercy, from the heavens—but expensive to distribute.
  Once the pipe has been laid from the reservoir to the house, the cost has been paid. It does not matter how much water is used or is not used, the cost will be the same. If people economise with water—unless there is a drought and people economise on a voluntary basis—the water authorities save nothing, because any water that is saved flows out of the reservoir, back into the rivers and into the oceans. Water—that God—given asset—is freely available, but must be paid for by the gallon and by the pint once the reservoirs have been built and the pipes have been laid to the households.
  Sir Anthony Grant: If that is the case, why did the Labour party, when it was in government, not abolish the water rate?
  Mr. Roberts: What has the water rate to do with water metering?
  I predict that compulsory water metering will be an inevitable consequence of water privatisation. Many members of the public have not realised that, in the interim, while the meters are being fitted—they will be fitted in all commercial and industrial premises in the north-west almost immediately, and automatically into any new dwellings—we shall get rid of water rates and have a water poll tax, which will not be related to the ability to pay, the size of the household or its consumption. That will be on top of the poll tax, and they will be

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  introduced, as they say in the music hall, at one and the same time. The water poll tax, along with the poll tax, will be the end of the Government. The Bill will put another nail in their coffin because water metering—as is the privatisation of water and making a profit from it—is opposed by the public.
  The Government are keen to sell off water, and they do not care who buys it. They do not care if the French buy it. They tell us that the French system is excellent. Some 99·2 per cent. of British households are connected to mains water supplies. In the United States it is 75 per cent.; in West Germany it is 86 per cent.; and in France—where the system is so good—under French privatisation it is only 56 per cent. When I visit France, Spain and many other countries, I must buy my water in bottles, because the tap water is not drinkable. That is becoming the state of affairs in many parts of this country because of the Government's neglect and their ignoring of EEC directives.
  The Australians want to buy into British water. The Australians are interested, and they do not give a triple X for our environment. They certainly do not give a triple X for providing cheap wholesome water for the British people.
  Mr. Roger King: Four X, actually.
  Mr. Roberts: It is the same thing. The Australians are interested in profit, and that will apply to everyone who buys into the water industry.
  It is said that costs will not rise, but there will not only be the extra costs—as the Minister admits—of any pollution control that may be imposed on the water industry by the National Rivers Authority, but there will be the costs arising directly from privatisation. There will be higher directors' fees and top managers' salaries. So far, there have been 85 per cent. increases in managers' pay in the first two years of any privatisation.
  In addition to the National Rivers Authority, there will be the cost of shareholders' registrations and servicing, dividends for shareholders, and corporation tax, which the consumer will have to pay because that will not come out of the profits. An expert on water authority finance has calculated that there will be an increase of 29 per cent. on existing costs. That will inevitably lead to higher charges. After announcing a 39 per cent. increase in profits, British Telecom put rentals up by 8·6 per cent. Many other costs will also he involved.
  What should be done? All the Government's stated aims for privatisation could be achieved without privatisation. The Government could free the authorities from their tight borrowing limits and the stupid restrictions of the public sector borrowing requirement. We will, and the Government could, democratise the water industry and put some accountability back into the way in which it is run regionally. At present the Government contribute no money to water authorities' operating costs, but they take out an increasing amount. That should stop. The present problems that the Government rightly highlight could be dealt with adequately.
  The Labour party and most of the British people are totally opposed to the privatisation of water. We recognise that water is even more essential than food. It should not be subject to the free market or to the profit motive. It
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  should be free and readily available, in public ownership, providing a plentiful supply to all who need it. and it should not be related to people's ability to pay.
  9.45 pm
  The Parliamentary Under-Secretary of State for the Environment (Mr. Colin Moynihan): I have never heard such a fundamental misunderstanding of an industry from a Front Bench spokesman as I have this evening from the hon. Member for Bootle (Mr. Roberts).
  To say that water just trickles down from the sky and appears, without cost, in the pipes and through the taps is a nonsense. It is a highly expensive industry, requiring highly expensive inputs for treatment and preparation. It is also subject to many European directives and many quality objectives. When the hon. Gentleman is on the Committee I only hope that he will pay as much attention to the importance of producing first-rate quality water as he has to the pipes and the supply works that provide water to homes.
  Mr. Allan Roberts: If water is so expensive to produce, why do the Government not take action to stop 30 per cent. of it leaking out of our aging system? From leaving the reservoir to reaching the tap, 30 per cent. of water is lost. How will water metering solve that problem? Will the Minister admit that the major cost to the water industry is distribution and not production?
  Mr. Moynihan: We accept that major capital expenditure is required and that is why we are investing in it, unlike the Opposition who slashed expenditure when investment was required.
  Tonight has also revealed another interesting point that emerged from an earlier and excellent speech from my hon. Friend the Member for Cambridgeshire, South-West (Sir A. Grant). Through his lucid description of the importance of his statutory water company, he identified that we have an interesting framework for the water industry—private companies under public regulation. My hon. Friend challenged the Opposition to inform the House whether it was their intention to nationalise the statutory water companies and to remove, as the hon. Member for Copeland (Dr. Cunningham) had stated, their present private monopoly status.
  The Opposition did not go as far as saying that they want to nationalise the statutory water companies. They accepted that there should be private companies and they welcomed the fact that, if one had private companies, they should be subject to proper and effective regulation. That is what we understood to be their argument. If the Opposition are unhappy about that summary of their argument, I shall give way.
  Mr. Allan Roberts: My hon. Friend the shadow Secretary of State made our position clear. We will take the water industry back into social ownership. That does not mean that a nationalised body will run all the water industry. If nothing has changed and the private statutory companies, which are regulated, still exist, they will not necessarily be taken back. But we predict that they will not, because powerful conglomerates will be running the water industry, and then they will be taken into social ownership.
  Mr. Moynihan: So if they continue to exist they will be private companies under public control and regulation. That is precisely what we are proposing in the Bill.
  We have come before the House with a Bill to create private companies within a strong regulatory regime to protect the customer against general abuses such as excessive charges, reduced service levels and the neglect of assets. Under that regulation individual customers should be entitled to rights and protection. We recognise that on the one hand the water industry can be given tremendous opportunities through the private sector and on the other hand that we need an important regulatory framework to protect customers. That is precisely the position being espoused by the Opposition on statutory water companies and that is exactly what we have produced in the Bill.
  Mr. Allen McKay: Will the hon. Gentleman give way?
  Mr. Moynihan: No. Many other points were mentioned and, out of courtesy to the House, I should like to deal with as many of them as I can.
  We are now halfway through the debate and many important points have been made about the National Rivers Authority. First, let me pay tribute to the work of the Select Committee on the Environment under the Chairmanship of my hon. Friend the Member for Hornsey and Wood Green (Sir H. Rossi). It was its report on the pollution of rivers and estuaries in May 1987 that drew attention to the anomaly that the present arangements for the control of water pollution involve water authorities having the dual role of poacher and gamekeeper. That anomaly has been central to our decision to create the National Rivers Authority.
  Let me try to allay the worries that many hon. Members have raised about the structure and organisation of the National Rivers Authority. We are confident that the proposals for the National Rivers Authority combine the best features of the existing system of unified control of the river basin while providing the essential separation of the regulatory functions in the new national body. The National Rivers Authority will retain control over river catchments because it will have all the functions associated with the management of natural waters—abstractions, discharges, pollution control, land drainage, flood protection and conservation.
  Hon. Members have raised an important issue relating to the staff and resources of the National Rivers Authority, a point rightly raised by the Select Committee in its third report. I can assure hon. Members that the Government are fully committed to ensuring that the authority has adequate staff and resources.
  But hon. Members will want me to go further than that. I hope that in the first stage hon. Members will have already drawn comfort from the fact that in the summary schemes of organisation that are now available in the Library it is clear that our commitments at the Dispatch Box are backed up by actions. The National Rivers Authority will have the vast majority of its 6,500 staff in the regions. The schemes show that pollution control and other functions will be carried out by same people who are currently carrying out those functions in the water authorities.
  The National Rivers Authority will inherit from the water authorities the staff needed to carry out all the functions, but—this is an important but—instead of being
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  a small part of a water authority whose primary function is water supply, it will represent the main function of an important national environment body. The creation of that new body is a major component of the Bill which recognises the great importance that we attach to pollution control and the environment.
  Important issues have also been raised on conservation and recreation. The first important point is to promote the good practice that exists already. Over recent years, numerous and varied practices and strategies have been adopted by water authorities in respect of conservation and recreation, some successful, others less so. The time has now come to identify and promote best practice to ensure that the industry learns from experience and to give more meaning and substance to the general duties placed upon it—hence, a code of practice for the first time, to which I shall return.
  The second is to seize the opportunities for conservation and recreation created by the restructuring of the industry. The creation of the NRA is an important milestone. It can take on tasks and functions which could not so readily have fallen to the water authorities, and some of its functions will be new. I shall return to that subject, too.
  Our brief should be twofold: to promote good practice and to seize the opportunities for positive steps forward in conservation and recreation. I shall follow through three aspects of the legislation, the first of which are statutory duties. The Bill imposes on the NRA and the plcs the duties to further conservation, having regard to landscape, natural beauty and public access, and to put their rights and properties to good use for recreation. These are broad and positive duties, which will set the tone for the privatised industry. I know that many people did not believe that we would preserve in a privatised regime the present duty to further conservation—but we have. So the Government are not going back on what has been achieved.
  Secondly, I turn to the code of practice. I hope that hon. Members on both sides who are concerned about the important issue of sport and recreation and conservation will carefully examine the implications of the code and benefit from the discussions about its detailed context that will take place. Early on in our privatisation proposals we suggested that the general statutory duties should be supplemented by a code of conservation and recreation practice. As is clear from much correspondence that I have received, that has received a wide welcome in the sporting world, and clause 9 provides for it.
  We shall shortly publish a first discussion draft of the code so that it can be taken into account at the relevant stages of the Committee proceedings. It will provide guidance on how the general duties, which are enforceable by the Secretary of State, are to be interpreted and applied. The Secretary of State will have to take account of the code and of any failure to observe it when exercising his enforcement powers. We hope that it will provide effective practical guidance to the companies on how the conservation and recreation duties are to be discharged. It will certainly provide them with a clear warning about the essential standards to be observed in this area—on matters concerning recreational duties, ramblers and anglers, canoeists and oarsmen. I have found in discussions with the bodies that represent anglers that they believe the NRA will enhance and protect their interests.

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  Another point mentioned by several of my hon. Friends concerned the importance of not segregating pollution control from recreation duties in the NRA. The two are intermingled in their effects. Anglers and, to a lesser extent, canoeists and oarsmen need pure water, so it is important for the recreation and conservation committees to ensure that all these interests are represented so that we can see the water course in the round and ensure that we enhance the conservation and recreation interest and improve the quality of the waters, thereby reducing the pollution risk.
  The hon. Member for Wakefield (Mr. Hinchliffe) raised one of the most important issues of the debate—disconnections—and I want to allay concerns about them. We shall discuss with the industry how the existing code of practice applying to customers who have difficulty in paying their bills could be strengthened to include additional safeguards. The existing arrangements, whereby debts may be paid off by instalments and people in receipt of income support may have serious debts deducted from benefit by the DSS and paid direct to the water undertaker, will continue. The new companies will be required to prepare or adopt a code of practice on disconnections at least as extensive as the present one.
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  [Interruption.] Opposition Members may laugh, but disconnections are a serious issue and I regret that the Opposition do not regard them as important. We do.
  My hon. Friend the Member for Norfolk, North-West (Mr. Bellingham) asked why there are so few prosecutions for pollution. I agree that there are too few prosecutions of those who pollute our water courses. We shall look to the National Rivers Authority to develop more rigorous and consistent national enforcement policies. Other measures are also needed and that is why we propose new regulations governing the construction of silage and slurry stores and oil storage installations in order to reduce the pollution risks about which my hon. Friend spoke.
  The hon. Member for Copeland spoke about drinking water standards not being in the Bill.
  It being Ten o'clock, the debate stood adjourned.
  Debate to be resumed tomorrow.

  Water Bill

    NEW PARLIAMENTARY BUILDING
    Ordered,
    That this House agrees with the Select Committee on House of Commons (Services) in its First Report of the last Session of Parliament on New Parliamentary Building (Phase 2): The Next Steps (House of Commons Paper No. 561 (1987–88)).—[Mr. David Hunt.]

  Midwives (Grading Review)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. John M. Taylor.]
  10 pm
  Mr. David Alton: I am indebted to you, Mr. Speaker, for this opportunity to raise the manner in which the regrading of midwives has been undertaken. I intend to examine the particular problems that this has caused in the Merseyside area. I am pleased to see that the Minister of State, Department of Health, is in his place to reply to the debate. I am sure that he will not be offended if I say that it might have been more appropriate if his hon. Friend the Parliamentary Under-Secretary of State were present. I understand that she was born in the Oxford street maternity unit which serves much of Liverpool. I am also pleased to see in the House the official Opposition spokesman. Anyone reading the debate will realise that in an Adjournment debate it is not possible for all hon. Members who are present to take part. However, I am glad to see so much interest.
  It is no bad thing to remind the House that 76 per cent. of us were brought safely into the world by midwives acting alone and assuming total responsibility for life and death decisions. Ministers are no exception, and while stridently asserting their claim that the National Health Service is safe in their hands they should pause to reflect that from the moment of birth many of us are safe in the hands of any one of the 32,000 members of the Royal College of Midwives.
  I want to use my time today to do three things. First, I shall set out the background to the present crisis, then I shall rehearse the grievances and finally I shall explore some of the ways forward. For just over 30 years between 1870 and 1902 midwives waged a national campaign to see themselves established as a separate profession and to create better maternity facilities for women. Thirteen Bills were required to be laid before Parliament before their much-prized autonomy was finally conferred. It is that hard-fought-for professional standing that is at the heart of the present dispute, not an avaricious love of money.
  The present Prime Minister established the pay review body for nurses, midwives, health visitors and the professions allied to medicine. In its third report, the review body conceded that the RCM had put forward a well argued case for a separate pay and grading structure for midwives. Unfortunately, both management and staff sides opposed any such development and midwives were simply lumped into the general regrading exercise. Only one of the eight seats for negotiators on the staff side is held by an RCM representative, so the unique and distinctive arguments of the midwives have been pushed to the margins and given a Cinderella status.
  As recently as 30 November, in reply to a letter from me, the Under-Secretary of State was still hiding behind the fig leaf of an agreement. Although midwives were a party to that agreement, it was never directly discussed with their professional body on a bipartisan basis. Two days ago, in answer to a parliamentary question which I tabled, the Secretary of State said:
  "I suspect that much of the sense of grievance felt by some midwives in Merseyside is caused by misunderstanding of the basis of the grading exercise which the Royal College of Midwives and other trades unions agreed to."—[Official Report, 5 December 1988; Vol. 143, c. 86.]
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  I repeat that midwives were never entirely happy about the basis on which the regrading exercise was begun, and as the row simmered over the summer period their unhappiness turned to anger and dismay. The other organisations which made up the staff side understandably concentrated on important issues such as the definition of supervision and continuing responsibility. The midwives were treated as an obscure minority interest.
  What are the midwives' grievances? Guidance on prime care providers was given by the Department to general managers in May and July 1988. The original agreement made between staff and management stated that one of the criteria for being placed on scale E was a requirement
  "to take responsibility as the prime care provider for one or a defined group of patients/mothers, in the hospital setting. He/she works with minimal supervision in the assessment of all relevant care needs, the development, implementation and evaluation of programmes of care. The post holder is able to supervise and teach junior staff including basic and/or post-basic students."
  Subsequently, in evidence to the pay review body on 5 January 1988, the staff stated in paragraph 4.3 that
  "the definition of the prime care provider at Scale E(2) was intended to cover those nurses and midwives carrying high levels of responsibility in relation to patients, clients or mothers, but whose work is so organised that they do not normally take charge of a ward or supervise other staff. There is no dispute that such jobs should be graded on scale E rather than D because of the level of their direct care responsibilities."
  When the Department's guidance to general managers was published, it sought first to limit and then to prevent the use of those criteria for midwives. It inserted double-talk in the form of an interpretative note, which was never agreed with staff, stating that
  "this is a 24 hour responsibility even though delivery of care is assigned to another nurse or midwife when the prime care provider is off duty."
  Clearly, in the context of midwives dealing with women whose labour may be less than eight hours, let alone 24 hours, and who may be discharged within hours of being admitted to the hospital, this is a deliberate exclusion clause. Yet the mother will have been cared for by one midwife throughout, who will have to make critical life-or-death decisions and a series of crucial judgments. The midwife is unarguably a prime care provider.
  The Department proceeded to compound its felony in supplementary management guidance which advised health authorities that the prime care provider criteria applied to a few authorities where primary nursing had been introduced. By implication, it did not include midwives. I hope that the Minister will confirm that health authorities may apply those criteria for midwives, and that he will arrange for written guidance to general managers clarifying this apparent misunderstanding and the 24-hour rule.
  Another grievance concerns the lack of fairness and consistency applied to the regrading exercise. Why has one staff midwife in 10 in England and Wales been placed on scale D, but only one in 500 in Scotland? Why have half the staff midwives in Wales been placed on scale F, but only one in eight in England? Why have 25 per cent. of midwifery sisters in Scotland and England been placed on scale F, but only 8 per cent. in Wales? There are many examples of hospitals where all or virtually all the hospital-based midwifery sisters have been placed on scale F, while in some areas every midwifery sister has been placed on scale G.

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  Funding restrictions are given as the reason for not having graded in accordance with the agreed criteria. Perhaps when the Minister replies he will say what differences exist between the five districts in the Mersey region. Will he say what consideration has been given to the consequences for recruitment and retention of midwives in the Mersey region and when it will be possible for them to move to north Wales and have their clinical skills recognised by higher grades and salaries? The problem cannot be minimised in a profession that already has an 8 per cent. vacancy rate at the sister-midwife level and a 17 per cent. shortfall of sister midwives.
  The Minister will no doubt state, as have his right hon. and hon. Friends, that the sheer size of the award should satisfy midwives. If he or representatives of the regional health authority had been present at a meeting that I addressed on 18 November at the Liverpool Institution, he would realise that the inconsistencies and confusion caused by the grading implementation have far outweighed any so-called benefits. The 130 midwives present at that meeting—even those who had benefited —signed a petition, which I subsequently presented to the House on 23 November, registering their unanimous dismay at the block grading, which they believe has been determined by cash constraints and not clinical considerations. In early day motion 79, my right hon. and hon. Friends and I emphasise our support for their case.
  Midwives at that meeting gave an example of a midwife with 10 or 12 years' service who was still on E grade. She will remain there until she either votes with her feet to leave the area or decides to go back into general nursing or into health visiting. To get to G grade is a near impossibility. Some sisters of 30 years' standing are not on G grade. The midwives told us at that meeting about students cancelling places at training schools. Although in October the Department stated that nurses opting for midwifery training need not be worse off during their training, the ludicrous situation still applies that, once they complete their training, they will be forced to apply for posts at the lower grade D. What sort of incentive is that? No one with a mortgage will be able to afford to take that option, so expenditure on such training will be of no avail. Taxpayers' money will be used to train people who will not be able to afford to take up posts.
  The Merseyside midwives gave an example of one woman who had trained another, yet the trainee had ended up on a higher grade than the trainer. One midwife said, "The Minister seemed to think that just because Lofty could deliver a baby on EastEnders anyone could do it," and that midwives' worth had effectively been downgraded. Experience in other countries shows that fewer midwives leads to more deliveries by doctors, more intervention and more caesarian deliveries—in other words, serious long-term shortages of midwives will be detrimental to care of mother and child and carry grave consequences for maternity services.
  What needs to be done? It is no good the Minister simply telling us that midwives in Merseyside and elsewhere should appeal. For a start, in many authorities the watchdog is too closely identified with the burglar, with the appeals mechanism weighted in favour of the health authorities. It is also a gruesomely long drawn out process, the length of which will turn this issue into a running sore. Before they consider the appeals, the Minister needs to tell the House what instructions he will give health authorities over issues such as prime care
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  provider criteria and on what basis appeals are to be settled. Are they, for instance, to be heard against the agreed grading criteria, or will authorities be expected to apply management guidance which grossly distorts those agreed criteria? The Minister needs to say what funds will be available if authorities decide to set aside their earlier decisions.
  The Government also need to change their attitude. They appear to believe that midwives do not understand the grading structure and that that is responsible for much of the unhappiness in the profession. As midwives see it, the problem is very much the other way around.
  Mr. Nigel Spearing: Does the hon. Gentleman agree that despite the 25 per cent. reduction in staff at Newham general hospital the midwives' diagnosis of the problem is virtually the same as the one that he is outlining, which, I dare say, is found throughout the country? It appears to the staff that the Department does not understand their job or profession.
  Mr. Alton: I am grateful to the hon. Gentleman for that intervention. The Merseyside problem is a microcosm of the difficulties faced all over the country and experienced by hon. Members on both sides of the House.
  It is important for us to recognise that midwives are not arguing that they should all be on the same grade. They believe that those midwives with identical responsibilities should be on the same grade. They cannot accept that it is right for an arbitrary distinction to be made between midwives doing precisely the same jobs. Many are on the sister scale, not because of supervisory duties but because of their clinical expertise and responsibilities. They will not accept being told that only a limited number of them can be paid on the scale appropriate to those skills and responsibilities because the regional health authority Will allow them only a limited number of posts at that grade. They strongly resent that, whether the district authority has selected certain midwives for the higher grade or whether they are all asked to compete for the limited number of scale G posts.
  Similarly, those midwives working in hospitals in ante-natal and post-natal areas cannot understand why they should be graded on lower scales than their colleagues doing similar work but based in the community. Midwives working in the community have a minimum of scale G, yet the Health Department has been advising that, although scale G posts may be in such areas as delivery suites and special care baby units, lower scales are appropriate for those hospital-based midwives who have responsibilities similar to those of their community-based colleagues. That is clearly nonsense. Each and every midwife, wherever she works, is legally accountable as an individual for the decisions that she makes and the actions that she takes. Hospital-based midwives are making crucial decisions without reference to other midwives or doctors every working day. If those decisions turn out to be mistaken, the midwife is liable to be struck off the professional register and be unable to practise. Community midwives find those arbitrary distinctions just as difficult to understand or support as do hospital-based midwives.
  What midwives such as Lorna Muirhead, a local RCM representative who organised the Liverpool meeting to which I referred, cannot understand is how a health department which supports integrated maternity services and therefore flexibility within maternity units and

  413
  flexibility between hospitals and the community can be seeking to enforce gradings which are having the effect of preventing that.
  All concerned agree that the operation and extension of that flexibility is desirable and in the interests of mothers and babies alike. I hope that I have said enough for the Minister to realise that, on Merseyside and in the country at large, midwives feel a deep sense of grievance and that we owe it to them and to mothers-to-be to come up with something better than the present grading hotchpotch. I hope that the Minister understands that they and their professional body, the Royal College of Midwives, which has today met the Secretary of State, will be awaiting his reply tonight with hopeful anticipation.
  10.15 pm
  The Minister of State, Department of Health (Mr. David Mellor): I am grateful for the opportunity to set the record straight about the grading of midwives both nationally and in the Mersey region because the hon. Member for Liverpool, Mossley Hill (Mr. Alton) is only the last in a long, but perhaps not altogether distinguished, line of people who have said some pretty extraordinary things about this exercise.
  Claims that the midwives have done badly out of this exercise quite simply do not stand up. This is the best deal ever for midwives and the biggest ever pay award for their profession, worth well over 20 per cent. on average. This award gives the profession the highest ever level of real terms pay, higher than the previous high point set by the Halsbury report in 1974 and the Clegg award in 1979. This is a larger award than that enjoyed by any other major staff group in the public sector this year. Midwives have done even better than nurses in the regrading exercise, which reflects their qualifications.
  I should like to bring some figures into this debate that will demonstrate that. As I have said, the average pay award for midwives this year is over 20 per cent. and, for staff midwives, it is over 25 per cent. In each case, these figures are exclusive of the London supplements which will add another 5 per cent. to 9 per cent. for those individuals who work in midwifery in London. Staff midwives have done particularly well. Nine out of 10 have gone on to the higher grades with increases this year of around £2,000, a quite unprecedented sum. The bulk of staff midwives have gone on to scale E with basic pay now of £9,200 to £10,650 a year and almost £2,000 a year more than that in inner London. With additional payments for working unsocial hours and overtime, the average earnings on this scale are likely to rise to £12,500 in the country generally and to around £14,500 in inner London.
  About one in eight staff midwives has been graded at F and received even larger increases of 40 to 45 per cent., an utterly unprecedented sum; that is to say, £2,900 to £3,900 this year. The hon. Member for Newham, South (Mr. Spearing) finds that funny, but he was a supine Back Bencher in the days when Labour Governments were cutting the real pay increases of nurses and midwives by 20 per cent.
  The minority of staff midwives—about one in 10—who have gone on to the lowest grade of D have still received increases this year of 7 to 10 per cent. and have still seen
  414
  their pay go up in real terms by 30 per cent. since 1979, an arresting contrast with what happened in the preceding years.
  Three out of four midwifery sisters have gone on to the higher grades and will receive increases of £2,000 to £3,000 this year. Their new scales are from £12,025 a year to £13,925 a year with additional payments for unsocial hours and overtime. Earnings for this grade are likely to rise to an average of £16,000 or almost £18,000 in inner London.
  A minority of midwifery sisters who receive smaller increases this year will nevertheless have seen their pay go up by over one third in real terms since 1979. Midwives have gone into the higher grades in even larger numbers than nurses at both levels. This reflects the additional qualifications that midwives must have.
  At staff midwife level, no fewer than 77 per cent. are on grade E, compared with 66 per cent. of staff nurses, and 12 per cent. have gone into grade F compared with 9 per cent. of staff nurses. As for midwifery sisters, 74 per cent. have gone into grade G compared with 58 per cent. of nursing sisters.
  It is not true that midwives have been treated badly during the exercise. Indeed, the exercise will give the nursing profession the greatest shot in the arm that it has had since the National Health Service was founded.
  Mr. Spearing: Will the hon. and learned Gentleman give way?
  Mr. Mellor: No, I shall not give way. If the Opposition want to debate the matter, they have their parliamentary time. I can assure them that my right hon. Friend the Secretary of State and I are only too willing to debate it at greater length, but this is not the occasion to do so. I want to get a few facts on the record in response to what the hon. Member for Mossley Hill said.
  Mr. Spearing: I wanted only to ask a question.
  Mr. Mellor: I understand that there is some misunderstanding in certain quarters within the profession. That is inevitable when a major change is instigated by the unions concerned, which were pressing for regrading. They did not want an across-the-board pay increase. They wanted a regrading that gave nurses and midwives an incentive to stay in clinical medicine rather than go into administration to improve their lot. When half a million people are being regraded in six months—perhaps the most massive industrial relations exercise that has ever been undertaken in Britain—it is inevitable that there will be some misunderstanding. That is why I want to deal with some of the issues that have been misunderstood. A number of points arise from what the hon. Member for Mossley Hill has said.
  We are talking about the greatest change in the way in which nurses and midwives are graded and paid in the history of the NHS. It is clear that some do not fully understand the thinking behind the change, and that is inevitable. We have a task before us to ensure that the reasons for the change are plainly understood. The old grading system was based on qualifications. Under the new structure, posts are graded on the basis of duties and responsibilities. In other words, the basis of grading has been overturned. It follows that some of the issues raised by the hon. Member for Mossley Hill, such as length of time in post and qualifications held, are not in themselves

  415
  factors that decide grading. That was commonly agreed after two and a half years of negotiations between unions and management.
  Mr. Spearing: Not midwives.
  Mr. Mellor: Midwives absolutely, yes. As usual, the hon. Gentleman is wrong on his facts. The Royal College of Midwives was a party to the agreement, along with the Royal College of Nursing. The colleges actively sought a regrading exercise and sought to persuade the Government that it was not sufficient to think in terms of pay increases. They argued that it was necessary to change the basis of grading, which was entirely archaic. A staff nurse was on one grade and a sister was on another. There was a low plateau of achievement in clinical medicine in terms of salaries and awards. It was time to do better, and I believe that history will show that that is what we have done.
  Inevitably, there is dislocation. The unions and the royal colleges knew when they embarked on the exercise that the basis of the regrading structure made it certain that some who were similarly graded in the past would find themselves in different grades and receiving different pay increases. That was inherent in the scale of the change.
  I appreciate that there are some concerns that are specific to midwives, and I am happy to address them. We know that midwives have long had the ambition that they should have a separate pay and grading structure. They have sought unsuccessfully to persuade the management side and the rest of the staff side of the nursing and midwifery staff negotiating council to accept that. They failed to impress the staff side and they took their case to the review body, which also rejected the idea that midwives, valued though they are—and they are valued enormously within the service—should have an entirely separate grading structure.
  The review body is another innovation of this Administration. Needless to say, the Labour Government were always in far too much economic jeopardy ever to agree to allow anything so radical as nurses' and midwives' pay to be recommended by a wholly independent body, recommendations which the Government would accept unless there were exceptional reasons not to do so. It was an innovation of the Conservative Government in recognition of the services nurses and midwives give to the community, and in recognition also of the happier economic times that allow us to fund increases of a sort that could not have been contemplated previously.
  In its fifth report, the review body said that the new structure, to which the Royal College of Midwives as part of the staff side agreed, would
  "provide a satisfactory basis on which to determine the grading of midwives, taking account of their training, qualifications and the particular responsibilities they carry."
  In determining that midwives should be on the same grading structure as nurses, we were acting on the clear endorsement of the independent review body, which has been established to consider those matters. I understand that the Royal College of Midwives remains attached to its opinions, notwithstanding the fact that it has, thus far, been unable to persuade anyone else, not least its colleagues on the union side, to join it on that point.
  Of course, the vast majority of midwives have to undertake midwifery training after they have completed training as general nurses and some midwives say therefore that they should have a higher level of grading as soon as
  416
  they have qualified. The management side's view is that the minimum level for midwives should be D—the same as the minimum level for registered nurses although, of course, only a small minority—one in 10—of staff midwives actually start on D. Nothing in the analysis of midwifery posts that was carried out during the grading review indicated that newly qualified midwives were working in a significantly different way from newly qualified nurses. We have to accept that in the modern Health Service of today, with high technology medicine a commonplace, there are many sophisticated practitioners of the arts of nursing and midwifery. Midwives, although vital to the service, are only one of a range of groups that bring additional qualifications and specialisms to the Health Service and that are equally entitled to be graded under this new grading structure, with unprecedented levels of salary and prospects. A sister who was earning £96 a week maxim um less than 10 years ago under the benevolent rule of the Labour Government now stands to earn at least £270 a week and, usually, on higher grades, much more than £300 a week. We would hardly have dared in 1979 to have said that that would be the improved condition of nurses and midwives, but that is what we have achieved.
  I conclude by dealing with the specific problems in Mersey. The hon. Gentleman very properly ranged more widely and I am glad to have had a chance to say something about the national picture. Turning to the outcome of the exercise in Mersey, the grading outcomes are very much in line with the national figures. A large majority of staff midwives and midwifery sisters have gone into the higher grades. That is hardly surprising because, of course, the exercise in Mersey has been carried out in line with the national guidelines. There are 190 different health districts in England and each of them is an independent decision-taker. It is inevitable that there will be differences between one district and another and the only alternative to that is for the man in Whitehall to do the whole job himself, which would lead to an equal range of protest, not more. I can imagine the outcry from the Opposition if there were more attempts by Whitehall to say that each district should come into line with another. We are caught in a Morton's fork. On the one hand, if we intervene too much we are criticised, and if we allow some districts to go their own way, we are criticised for that. It is a no-win situation and we must take much of the criticism with a substantial grain of salt. My hon. Friend the Parliamentary Under-Secretary of State for Health assures me that salt in excess is bad for health.
  To the extent that the pattern of grading differs from that elsewhere, this is likely to be explained by the fact that, under the old grading system, there were 60 per cent. more midwifery sisters than staff midwives in Mersey. That compares with a national pattern where there were about 10 per cent. more midwifery sisters. That is good news for Mersey because it means that the number of experienced midwives in the region is somewhat higher than elsewhere. It also means that sisters in Mersey were doing some of the jobs that staff midwives were doing elsewhere and vice versa, and this will, very properly, be reflected in the grading outcome, which analyses existing jobs and not individuals.
  The newly appointed regional nursing officer in Mersey is keen to develop the educational strategies for midwives in the Mersey region. Plans are in hand for a direct entry midwifery training programme which will deal with some of the problems and anomalies that the hon. Gentleman

  417
  has identified. It will allow students to follow a three-year course without first having to undertake nurse training and we hope that it will commence in the autumn of next year and will be well supported in the Mersey region.
  There are also plans to extend professional development programmes for qualified midwives and to develop links with universities for an advanced diploma in midwifery course. Work is also beginning in Mersey on an examination of work loads and activity, linked to skill mix, to ensure the best utilisation of valuable midwifery resources. All these developments are to be welcomed and should serve to boost the morale of midwives in Mersey and aid their recruitment and retention.
  418
  We hope that we have demonstrated in the most practical way possible the high regard in which we hold the midwifery profession. Midwives' pay stands at its highest ever in real terms. The new grading structure is the biggest change in the grading and pay of midwives since 1948. The agreement was reached after very hard negotiations with the trade unions. It provides a structure capable of recognising and rewarding the exciting developments in the maternity services—
  The motion having been made at Ten o'clock and the debate having continued for half an hour, MR. SPEAKER adjourned the debate without Question put, pursuant to the Standing Order.
  Adjourned at half-past Ten o'clock.

DEFENCE

  United States Chemical Munitions
  Mr. Redmond
  To ask the Secretary of State for Defence what United States chemical munitions or components of chemical munitions are(a) stored, (b) transported or (c) deployed within the United Kingdom.

  Mr. Freeman
  None.

  Argentina
  Mr. Cohen
  To ask the Secretary of State for Defence how many United Kingdom defence contracts have been concluded with Argentina since June 1982; and when export sales organisations of his Department resumed their efforts to promote the sale of military equipment to Argentina.

  Mr. Sainsbury
  No United Kingdom defence contracts have been concluded with Argentina since June 1982, and currently there continues to be no promotion of defence equipment sales to that country by my Department.

  Nuclear Tests
  Mr. Cohen
  To ask the Secretary of State for Defence whether there have been any British nuclear tests in 1988; and if he will make a statement.

  Mr. Sainsbury
  No.

  Procurement
  Mr. Wigley
  To ask the Secretary of State for Defence what is his estimate of the annual procurement costs within his Department; and what proportion of this is obtained from(a) Wales and (b) south-east England.

  Mr. Sainsbury
  I refer the hon. Member to the answer I gave him on Tuesday 29 November at columns 570-71 and the answer I gave to the hon. Member for Meirionnydd Nant Conwy (Dr. Thomas) on 18 April at column 334.

  Mr. Menzies Campbell
  To ask the Secretary of State for Defence how many persons are employed in the procurement division of his Department who are legally qualified.

  Mr. Sainsbury
  I will write to the hon. Member.

  Staff Dispersal
  Mr. Pawsey
  To ask the Secretary of State for Defence what consideration is being given to the relocation of Ministry of Defence procurement staff away from central London.
  158
  Mr. Sainsbury
  Studies are already in hand into how best to rationalise the location of staff in the sea systems controllerate of the Procurement Executive, most of whom already work at sites in the south-west. Initial studies are now being launched into the feasibility of relocating the work of the land and air systems controllerates, which together employ over 3,000 people, the bulk of them in central London. As has already been said, Ministers are currently considering the results of an investment appraisal concerning the future location of the directorate general of defence quality assurance.

  VAT
  Mr. Heddle
  To ask the Secretary of State for Defence what assessments he has made as to the likely effect on(a) his Department's capital building programme and (b) the rent the Department will pay under occupational leases, of implementation of the European Court of Justice's judgment on value added tax on non-domestic buildings.

  Mr. Freeman
  Implementation of the European Court of Justice's judgment on VAT will have no effect on my Department's capital building programme, since compensating adjustments have been made to the relevant expenditure provisions. At this stage, before landlords have decided whether to exercise their option to tax rents, it is not possible to offer meaningful estimates of the effects of the judgment on rental costs.

  Aldermaston and Burghfield
  Mr. O'Neill
  To ask the Secretary of State for Defence how many projects were examined in the independent programme audit of the capital works programme at Aldermaston and Burghfield carried out by British Nuclear Fuels; what was the number of staff engaged to carry out this audit; and what was the total cost of the audit.

  Mr. Sainsbury
  The BNFL programme audit reviewed four major projects and was carried out by a seven-man team representing 218 man days' effort. It is not the practice to reveal the details of individual contract costs for reasons of commercial confidentiality.

  Trident
  Mr. O'Neill
  To ask the Secretary of State for Defence how long a delay in a Trident-related programme must be before it is considered significant enough to report to the Defence Committee in the course of its annual examination of the Trident programme.

  Mr. Sainsbury
  It is the MOD's aim to provide the Select Committee on Defence with information concerning the progress of all significant aspects of the project. In reaching a judgment as to the significance of a projected delay in a part of the programme the MOD will consider aspects such as prospects for recovery and possible consequences of any overruns. Judgments are then made on a case-by-case basis.

  Mr. O'Neill
  To ask the Secretary of State for Defence where those elements of the Trident warheads that are purchased from the United States will be serviced and maintained.
  159
  Mr. Sainsbury
  Servicing and maintenance of the British warhead for Trident will be undertaken in this country, regardless of the source of any particular elements.

  Mr. O'Neill
  To ask the Secretary of State for Defence what is the proportion of non-fissile elements in the Trident warhead that will be produced in the United Kingdom.

  Mr. Sainsbury
  It has been the policy of successive Governments not to reveal detailed information of this nature, for security reasons. I would, however, refer the hon. Member to the broad indications given in the recent report of the Defence Committee (third report, Session 1987–88, page 22, Q26).

  Non-nuclear Defence Research Establishments
  Mr. O'Neill
  To ask the Secretary of State for Defence when he expects to finish his considerations of the conclusions and recommendations of the report of the defence research study team into the feasibility of establishing the non-nuclear defence research establishments as an executive agency.

  Mr. Sainsbury
  Shortly.

  Defence Statistics Organisation
  Mr. O'Neill
  To ask the Secretary of State for Defence whether he intends to order a feasibility study into the potential for using the private sector in the work of the Defence Statistics Organisation.

  Mr. Sainsbury
  I am still considering what action should be taken on the report on the potential for using the private sector in the Defence Statistics Organisation.

  Contractors
  Mr. Menzies-Campbell
  To ask the Secretary of State for Defence what contractual arrangements his Department makes when placing orders with defence contractors to ensure that deliveries are made on time and up to specification.

  Mr. Sainsbury
  [holding answer 6 December 1988] : The Ministry's policy is to negotiate taut contract terms and conditions which define the requirements in terms of specification and delivery and which enable redress to be sought where appropriate.

TRANSPORT

  Lorries
  Mr. Cohen
  To ask the Secretary of State for Transport if he will introduce regulations to control the shedding of stones and gravel from lorries; and if he will make a statement.

  Mr. Peter Bottomley
  Effective legislation for enforcement already exists in the Road Vehicles (Construction and Use) Regulations, as supplemented by the Department's code of practice on the safety of loads on vehicles.

  Road Accident Statistics
  Mr. Hinchliffe
  To ask the Secretary of State for Transport how many children under the age of five years have been killed in traffic accidents in which the vehicle driver was found to be intoxicated with alcohol.

  Mr. Peter Bottomley
  In 1986, two children under the age of five years were killed in accidents where at least one of the drivers involved had a blood or breath alcohol content above the legal limit. In 1987, three children under five years were killed in accidents where a driver involved failed a roadside breath test. The accidents where a driver was killed and found to have a high blood alcohol content have not yet been completely indentified for 1987.

  Mr. Hinchliffe
  To ask the Secretary of State for Transport how many fatalities and serious injuries concerning children under five years travelling in vehicles involved in traffic accidents took place in the years 1980 to 1988; and how many of these children were travelling in car safety seats.

  Mr. Peter Bottomley
  The table shows the numbers of children under five years who suffered fatal or serious injuries in road accidents while they were travelling in cars or other motor vehicles. It also shows the percentage of these child casualties who were recorded as using a child restraint or seat belt.

  Casualties (fatal and serious) among children aged 0-4 travelling in motor vehicles: Great Britain: 1980–1987

  Year

  Vehicle type

  Percentage of (a) restrained

  (a) Cars

  (b) Other motor vehicles

  1980

  329

  39

  6

  1981

  306

  48

  9

  1982

  330

  36

  11

  1983

  310

  34

  15

  1984

  381

  33

  19

  1985

  357

  33

  15

  1986

  390

  30

  19

  1987

  403

  28

  20

  It is obvious that the numbers are influenced by the spreading family use of cars and the percentage by the growing installation and use of restraints by child passengers.

  Motor Cycles
  Mr. Alton
  To ask the Secretary of State for Transport how many motor cycle accidents there have been in each of the last 10 years.

  Mr. Peter Bottomley
  Too many. The trend is downwards.

  The table attached shows the number of motor cycles involved in accidents in Great Britain between 1977 and 1987. The total number of motor cycle accidents is lower, since some accidents involve more than one motor cycle.

  Motor cylce involved in accidents: Great Britain: 1977–1987

  Year

  All Severities

  1977

  73,676

  1978

  71,382

  1979

  69,173

  1980

  73,054

  1981

  70,949

  161

  Year

  All Severities

  1982

  73,033

  1983

  65,962

  1984

  65,340

  1985

  57,822

  1986

  53,562

  1987

  47,024

  Motor cycles include all two-wheeled motor vehicles.

  Mr. Alton
  To ask the Secretary of State for Transport if he is considering restricting the power of motor cycles bought for road use in the United Kingdom; and if he will make a statement.

  Mr. Peter Bottomley
  There are existing and proposed limitations on the size of motor cycles that some riders may use. Motor cycle importers follow a voluntary maximum limit of 125 bhp for motor cycles brought into this country for use on the road.

  The 1981 Transport Act restricted learner riders to machines of 125cc. Research indicates that this has reduced learner rider casualties by one quarter. The move up from a 125cc motor cycle to a large high performance machine can be too big a step for newly qualified riders. I therefore announced in February that we propose to introduce a new licence category for motor cycles in excess of 400cc. Progress to these larger machines will be linked to two years riding experience on a full licence. This will bring us into line with the relevant European proposals for harmonisation of driving licences. We have no plans to restrict the power of motor cycles sold in this country.

  Road Signs
  Mr. Jack
  To ask the Secretary of State for Transport if he will list in the Official Report the locations on motorways and trunk roads of variable message signs, the number of signs currently in use on each road, the costs involved in installing them and details of their running costs; and if he will make a statement about his future intentions to extend the use of this type of sign and give details of the roads on which they will be installed.

  Mr. Peter Bottomley
  The detailed information requested is not readily available. I shall write to my hon. Friend.

  Roads and Pavements (Reinstatement)
  Mr. Bowis
  To ask the Secretary of State for Transport what steps he is taking to ensure the reinstatement of roads and pavements to their original standard by the utilities following work undertaken by them.

  Mr. Peter Bottomley
  The breaking open and reinstatement of streets by public utilities is regulated by a general code in the Public Utilities Street Works Act 1950. Reinstatement is either carried out entirely by the utility, or the highway authority may elect to do all or certain portions of it themselves. In cases where the highway authority does not elect to reinstate a street, the utility is under an obligation to carry out the reinstatement in accordance with any reasonable requirements of the highway authority and to reinstate openings up to the original surface level.

  We accepted in our response to the Horne report on the review of the Public Utilities Street Works Act 1950 that new primary legislation is required. It is proposed that
  162
  utilities should be made entirely responsible for reinstating the highway following their excavation work. They would have to comply with new national specifications for reinstatement and meet objective standards of performance for the repaired road surface. Work to prepare these specifications and standards is well advanced. Utilities would be required to make good, at their expense, any reinstatements which fell outside these standards during a warranty period.

  Legislation will be introduced as soon as a suitable opportunity can be found.

  Manchester Airport
  Mr. Alfred Morris
  To ask the Secretary of State for Transport if he will make a statement on the progress of the talks, involving representatives of his Department and of the United States Government, on the licence applications for Manchester routes by three United States airlines; and if there is any further action he will be taking.

  Mr. Peter Bottomley
  The two sides explored a number of new ideas from which an appropriate basis for agreement may be found. A further round of negotiations will be held this month or early in January. Precise dates are currently being considered.

ATTORNEY-GENERAL

  Patrick Ryan
  Mr. Gow
  To ask the Attorney-General whether he is satisfied that the request for extradition of Mr. Patrick Ryan from Belgium was accompanied by the appropriate legal documents prepared properly in accordance with Belgium law; what information he has as to the grounds on which that request was refused; and what steps he is taking to secure the extradition of Mr. Ryan from the Irish Republic.

  The Attorney-General
  I am satisfied that the documents were prepared properly to meet the requirements of Belgian law. The advice of the Belgian prosecuting authorities themselves was sought, given and followed in the preparation of the extradition request.

  The request was refused by the Belgium Government on the grounds that:
  "it would appear from examination of the case that the imprecise charges contained in arrest warrants delivered by the British legal authorities and retained by executing order of the chamber of indictments and investigation of the Appeal Court do not constitute the necessary elements for the offence of conspiracy in Belgian law, the only grounds on which, according to the executing order, extradition to the United Kingdom could have been agreed by Belgium".

  The court of first instance and the Court of Appeal of Brussels had both upheld the extradition request in relation to the conspiracy charges.

  As regards the steps taken to secure Ryan's extradition from the Republic of Ireland, I refer my hon. Friend to the answer I gave to the private notice question tabled by the right hon. and learned Member for Aberavon (Mr. Morris) on 1 December. The Irish Attorney-General's Office sent to my Office in the late afternoon of 1 December a letter requesting clarification and further information on certain matters set out in the statements of facts and law sent to him on 25 November. A full response

  163
  answering all the questions was transmitted to the Irish Attorney-General's Office during the afternoon of 2 December.

PRIME MINISTER

  Ministers (Public Statements)
  Mr. Maxwell-Hyslop
  To ask the Prime Minister whether she will take action to discourage Ministers from making public statements outside the remit of their own Department.

  The Prime Minister
  Ministers will continue to speak on Government policy as appropriate.

  Mr. Maxwell-Hyslop
  To ask the Prime Minister whether the duty of making public statements concerning the safety of agricultural produce for human consumption reposes in Ministers of the Ministry of Agriculture, Fisheries and Food, or in the Department of Health.

  The Prime Minister
  The safety of foodstuffs consumed in this country is a matter for Health and Agriculture Ministers acting jointly. By arrangement, the Department of Health leads on matters concerning food hygiene and microbiological contamination of food which are likely to pose public health risks whereas Ministry of Agriculture, Fisheries and Food leads on all other food issues and associated health risks. In either case there is close liaison between Health and Agriculture Departments and consultation with relevant outside interests.

WALES

  Welsh Development Agency
  Mr. Geraint Howells
  To ask the Secretary of State for Wales if he has any plans to alter the operation of the Welsh Development Agency; and if he will make a statement.

  Mr. Peter Walker
  I refer the hon. Gentleman to the reply I gave to the hon. Member for Alyn and Deeside (Mr. Jones) on 26 October 1988, at column 224.

  Hospital Waiting Lists
  Mr. Geraint Howells
  To ask the Secretary of State for Wales what progress he is making in reducing hospital waiting lists in Wales; and if he will make a statement.

  Mr. Grist
  Responsibility for the management of waiting lists in Wales rests with district health authorities within their allocated financial resources which (in terms of recurrent revenue provision and after taking account of inflation) have risen by 34 per cent. in the period 1978–79 to 1988–89. As part of the Department's efforts to reduce waiting times, £1 million of additional moneys have been made available to health authorities in each financial year from 1986–87 to 1988–89 to tackle specific problem lists. In 1988–89 this extra help should generate an estimated additional throughput of 10,300 new out-patients and 1,400 in-patients.

  The Welsh Office is keeping the activities of DHAs under close scrutiny. In addition to the annual reviews of health authorities' performance, which include their efforts to tackle waiting lists, officials have recently completed a round of meetings with all authorities to discuss their plans for reducing waiting times.
  164
  At March 1988 72 per cent. of urgent in-patient waiting lists 61 per cent. of non-urgent in-patient waiting lists and 46 per cent. of out-patient waiting lists were within the waiting times targets. I am none the less concerned that many patients have to wait over-long for treatment, and the drive to reduce waiting times will continue.

  Health Service (Grading)
  Mr. Corbyn
  To ask the Secretary of State for Wales if he will indicate the date on which he first received grading projections from each health authority on the new clinical structure for nurses, midwives and health visitors.

  Mr. Grist
  Provisional returns for Welsh district health authorities were received by the Department during the first two weeks of September 1988.

  Mr. Corbyn
  To ask the Secretary of State for Wales if he will publish a breakdown of the new grading structure for nurses, midwives and health visitors broken down by grade, type of hospital including psychiatric, geriatric and acute, by district and region.

  Mr. Grist
  I refer the hon. Gentleman to the replies I gave to my hon. Friend the Member for Vale of Glamorgan (Sir R. Gower) on 30 November, at columns 244-46, and 1 December at columns 349-50. Information by area of work is not available centrally.

  Cervical Smear Tests
  Mr. Nicholas Bennett
  To ask the Secretary of State for Wales what is the average time taken by each Welsh health authority to process cervical smear tests and provide the results for the patient and her general practitioner; and if he will make a statement.

  Mr. Grist
  I refer my hon. Friend to the reply I gave him on 14 June 1988, at column 85, which contains the latest comprehensive information available centrally.

EDUCATION AND SCIENCE

  Free School Transport
  Mr. Harry Greenway
  To ask the Secretary of State for Education and Science if he has any plans to review the free transport limits for school pupils; and if he will make a statement.

  Mr. Butcher
  My right hon. Friend has no such plans at present.

  Disabled Persons (Staff)
  Mr. Sean Hughes
  To ask the Secretary of State for Education and Science what percentage of his Department's staff are classed as disabled.

  Mrs. Rumbold
  2·5 per cent. of the Department's staff are registered disabled persons.

  It is the Department's policy to encourage applications from disabled people. All those who apply with the necessary qualifications, or pass the alternative written test, are invited for an interview.

  VAT
  Mr. Heddle
  To ask the Secretary of State for Education and Science what assessments he has made as to
  165
  the likely effect on (a) his Department's capital building programme and (b) the rent the Department will pay under occupational leases, of implementation of the European Court of Justice's judgment on value added tax on non-domestic buildings.

  Mrs. Rumbold
  Implementation of the European Court of Justice's judgment on VAT will have no effect on my Department's capital building programme, since compensating adjustments have been made to the relevant expenditure provisions. At this stage, before landlords have decided whether to exercise their option to tax rents, it is not possible to offer meaningful estimates of the effects of the judgment on rental costs.

  Teachers
  Mr. Fatchett
  To ask the Secretary of State for Education and Science what information he has as to the salaries of grades of teachers comparable to those in the United Kingdom in each member state of the European Community.

  Mrs. Rumbold
  Some information on European Community teachers' salaries in 1985 is published in a detailed research report "The Conditions of Service of Teachers in the European Community", published by the European Commission in 1988 (pages 133 to 160). A copy is available in the Library.

  Mr. Fatchett
  To ask the Secretary of State for Education and Science if he will take steps to ensure that the pay of supply teachers takes account of their length of service and experience.

  Mrs. Rumbold
  The schools teachers' pay and conditions document 1988 already provides for local education authorities when determining the pay of a supply teacher to have regard to any qualifications or experience which they consider to be of value in the performance of his duties.

  Science and Engineering Research Council
  Mr. Dickens
  To ask the Secretary of State for Education and Science whether he has received the annual report of the Science and Engineering Research Council for 1987–88; and if he will make a statement.

  Mr. Kenneth Baker
  The annual report of the Science and Engineering Research Council for 1987–88 has been submitted to me under the requirements of the Science and Technology Act 1965, and a copy is being laid before the House today.

  I was most interested to study the report on what has obviously been an exciting year for the council in fields ranging from fundamental work in astronomy to areas of great potential for future exploitation. I was particularly encouraged to note:

  (i) the increase in the proportion of the council's expenditure applied to grants for core sciences and engineering research in higher education institutions—from 30·9 per cent. in 1986–87 to 33·5 per cent. in the year under review;

  (ii) the development of the interdisciplinary research centre (IRC) concept, with the announcement of the first four centres during the year, at a cost of £25·7 million over six years;

  166

  (iii) the rapid response of the council and its academic and industrial committees to the fast-moving developments in high temperature superconductivity—including the choice of this subject for the first of the council's IRCs and in addition the allocation of some £700,000 in grant awards, with the later commitment of a further £2 million early in the 1988–89 session;

  (iv) the council's participation, jointly with the Department of Trade and Industry (DTI), in the first collaborative LINK programmes in molecular electronics; advanced semiconductor devices; eukaryotic genetic engineering; and industrial measurements systems–the total SERC contribution to these programmes totalling £14·3 million over five years; and

  (v) the deployment for high quality research by British scientists of sophisticated equipment such as the Liverpool university electron microscope capable of beam control over atomic dimensions; the high brightness lattice on the synchrotron radiation source at the council's Da resbury laboratory; transputer equipment at the national and regional centres, jointly funded with the DTI; and the 4.2 million William Herschel optical telescope on La Palma.

  I look forward to seeing what progress has been achieved with these new initiatives and equipment in next year's report.

TRADE AND INDUSTRY

  Inner-city Task Forces
  Mr. Knowles
  To ask the Chancellor of the Duchy of Lancaster what further progress has been made in the 16 inner-city task forces.

  Mr. Simon Hughes
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the progress achieved by his Department's inner-city task forces.

  Mr. Newton
  Since the task forces first began their work in 1986, they have supported over 1,000 projects, committing over £33 million of Government funds to stimulate the regeneration of their areas.

  At the last count, as I indicated in my answer to my hon. Friend the hon. Member for Lancashire, West (Mr. Hind) on 26 October, task forces projects have been approved that are expected to generate or safeguard at least 4,000 jobs, and to facilitate more than 20,000 training places. Over 400 companies have been involved in the task forces' work.

  Mr. Favell
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the progress of the inner-city task forces in the north-west.

  Mr. Forth
  The inner-city task forces are central to the Government's action for cities programme. Their objectives are to secure more jobs for local people, to improve their employability, to encourage and facilitate local enterprise and to support environmental and crime prevention initiatives which also contribute to these objectives.

  All three inner-city task forces in the north-west have made excellent progress towards achieving these aims. To

  167
  date, the Moss Side and Hulme (Manchester), Preston and Rochdale task forces have supported 141 projects which, among other things, have helped to create or safeguard 214 jobs and 1,315 training places.

  All three have established development funds in co-operation with private sector institutions to help the start-up or strengthening of small businesses. They have sought to improve residents' employability by, for example, sponsoring courses in English as a second language, with particular reference to job-seeking skills. Training courses in skills relevant to industries such as textile and knitting, construction, computing and the banking and finance sectors have also been established.

  Takeovers
  Mr. Tim Smith
  To ask the Chancellor of the Duchy of Lancaster what was the value of takeovers by overseas companies in the United Kingdom for the latest convenient period; and what was the corresponding figure for overseas takeovers by United Kingdom companies.

  Mr. Maude
  The value of cross-border acquisition and mergers by overseas companies in the United Kingdom in the 12 months to September 1988 was £5·8 billion. The corresponding figure for cross-border acquisitions and mergers by United Kingdom companies was £11·7 billion.

  Mrs. Ray Michie
  To ask the Chancellor of the Duchy of Lancaster when he next plans to meet the chairman of the Monopolies and Mergers Commission to discuss takeover policy.

  Mr. Maude
  I have no plans at present to meet the chairman of the Monopolies and Mergers Commission to discuss merger policy. The chairman of the Commission meets my right hon. and noble Friend the Secretary of State for Trade and Industry and myself from time to time to discuss matters relevant to the work of the commission.

  Mr. Butterfill
  To ask the Chancellor of the Duchy of Lancaster what action he is taking to ensure a level playing field for takeover bids within the European Economic Community.

  Mr. Maude
  The Government raised the issue of barriers to takeovers in Europe at the Internal Market Council on 18 November.

  Mrs. Mahon
  To ask the Chancellor of the Duchy of Lancaster what is the current level of company spending on takeovers.

  Mr. Maude
  In the 12 months to September 1988 United Kingdom industrial and commercial companies' expenditure on acquisitions of United Kingdom companies was about £20 billion and their expenditure on acquisitions of overseas companies was about £6 billion. Further information is published in Business Monitor MQ7 "Acquisitions and mergers by industrial and commercial companies".

  EC (Trade Balance)
  Mr. Ron Brown
  To ask the Chancellor of the Duchy of Lancaster what he expects the impact of 1992 to be on the trade balance with other European Economic Community countries.

  Mr. Alan Clark
  The single European market will create opportunities for increased trade with the European 168
  Community as the barriers are removed. Realising the potential gains to the economy, including improved competitiveness against third countries, will depend on the flexibility of United Kingdom firms in responding to the new opportunities and challenges.

  Mr. McAvoy
  To ask the Chancellor of the Duchy of Lancaster what he expects the impact of 1992 to be on the trade balance with other European Economic Community countries.

  Mr. Alan Clark
  The single European market will create opportunities for increased trade with the European Community as the barriers are removed. Realising the potential gains to the economy, including improved competitiveness against third countries, will depend on the flexibility of United Kingdom firms in responding to the new opportunities and challenges.

  Information Technology (Research)
  Mr. Ian Bruce
  To ask the Chancellor of the Duchy of Lancaster what he is doing to encourage collaboration between universities and industry in the field of information technology research.

  Mr. Forth
  The Alvey programme successfully brings together industry and universities in collaborative IT research, and will continue until 1991–92. Support for collaboration between industry and universities will continue through further national and European IT research programmes, particularly Esprit and our new advanced technology programme, launched by my predecessor in July 1988, to which there has already been a most encouraging response.

  Civil Research and Development
  Mr. Eadie
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the level of expenditure by British industry on civil research and development.

  Mr. Forth
  Expenditure by United Kingdom industry on industrial research and development amounted to about 1 per cent. of GDP in 1986, just slightly above the proportion for 1985. The economic climate established by Her Majesty's Government should encourage United Kingdom industry to raise its level of R and D expenditure further.

  Competitiveness
  Mr. Meale
  To ask the Chancellor of the Duchy of Lancaster which measures of competitiveness have shown an improvement since 1979; and which have shown a deterioration.

  Mr. Newton
  The two main measures of international competitiveness are relative unit labour costs and share of world trade. Compared with our major competitors United Kingdom relative unit labour costs for manufactured goods fell by 5·8 per cent. between 1979 and 1987. Our share of the volume of world trade in manufactures has been broadly stable since 1981, after many years of decline. The signs are that our non-price competitiveness, which covers factors such as quality, reliability and after-sales service has also improved.

  Departmental Official History
  Mr. Dalyell
  To ask the Chancellor of the Duchy of Lancaster if he will commission Sir Brian Hayes to write the official history of his Department for the period 1985 to 1986.

  Mr. Newton
  "Shoes and Ships and Sealing Wax", a history of the Department published in 1986, covered the period from 1786 to 1986. A copy was placed in the Library.

  CBI
  Mr. Oppenheim
  To ask the Chancellor of the Duchy of Lancaster when he last met the Confederation of British Industry; and what matters were discussed.

  Mr. Newton
  I last met the CBI on 24 November when I spoke at its conference "Business Opportunities in Urban Regeneration".

  Company Headquarters
  Ms. Mowlam
  To ask the Chancellor of the Duchy of Lancaster how many of the headquarters of Britain's top 100 companies are outside the south-east; and if he will give comparable figures for 10 and 20 years ago.

  Mr. Atkins
  I regret that this information is not available.

  EC (Trade Deficit)
  Mr. John Garrett
  To ask the Chancellor of the Duchy of Lancaster with which European Economic Community countries Britain is running a trade deficit.

  Mr. Alan Clark
  In the 12 months to October the United Kingdom had deficits on visible trade with Belgium/Luxembourg, Denmark, Federal Republic of Germany, France, Italy, the Netherlands and Portugal.

  EC (Research and Development)
  Mr. Worthington
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the future of the European Community framework programme of research and development.

  Mr. Forth
  There has been welcome progress in implementing specific research programmes within the current framework programme. The Commission is itself conducting a review and is expected to put forward its own ideas for the future of Community research next year. At this stage it is not possible to anticipate what its conclusions may be. The United Kingdom will play an active part in the subsequent discussions. We shall, however, insist that any proposals for revision of existing Community research activity must be fully justified.

  Barlow Clowes
  Mr. Sedgemore
  To ask the Chancellor of the Duchy of Lancaster when he last met representatives of Barlow Clowes investors.

  Mr. Dunnachie
  To ask the Chancellor of the Duchy of Lancaster when he last met representatives of the Barlow Clowes investors.
  170
  Mr. Maude
  I met representatives of the Barlow Clowes Investors Group on 24 November.

  Mr. Bellingham
  To ask the Chancellor of the Duchy of Lancaster if he will make a further statement on the Barlow Clowes affair.

  Mr. Maude
  Copies of Sir Godfray Le Quesne's report were passed to a number of regulatory and professional bodies. Action being taken by the Securities and Investments Board and the Financial Intermediaries, Managers and Brokers Regulatory Association was set out in my answer of 10 November at column 261. The Institute of Chartered Accountants in England and Wales has set up a team to examine the work of the auditors involved in the case, which has been asked to report by the end of the year.

  I understand that the joint liquidators of Barlow Clowes International and Barlow Clowes Gilt Managers continue to make progress on recovery of investors' funds and towards distribution of recovered funds, as described by my right hon. Friend the Chancellor of the Duchy of Lancaster in his statement on 20 October.

  Contract Industrial Research
  Dr. Bray
  To ask the Chancellor of the Duchy of Lancaster what estimates he has made of the growth of the contract industrial research market in the United Kingdom and worldwide.

  Mr. Forth
  Figures published in the 1988 annual review of Government-funded research and development show a rising trend of expenditure on extramural contract research and development by United Kingdom industry. In 1985 the figure was £332 million rising from £464 million in 1986. Independent forecasts suggest that this trend is likely to continue and that contract research and development expenditure is growing faster than intramural expenditure, the latter growing appoximately in line with GDP. There are no published worldwide figures.

  Action for Cities Campaign
  Dr. Twinn
  To ask the Chancellor of the Duchy of Lancaster how the private sector is responding to his Department's action for cities campaign; and how he plans to increase its involvement.

  Mr. Newton
  The private sector response has been excellent. Our series of seven breakfast presentations, completed in the east midlands on 6 December, has already led to over 300 offers of help or expressions of interest in urban regeneration from local business people. Chambers of commerce are becoming increasingly involved in planning the renewal of their cities. At national level the CBI, Business in the Community and Phoenix have joined in a forum to promote and assist the development of local business leadership. Above all, the growth of activity and investment in inner cities shows that the private sector is taking the business opportunities which action for cities is helping to generate.

  The £3,000 million that the Government are spending on inner cities this year will do much to encourage more businesses to become involved in the inner cities. We shall also continue to make clear the commercial benefits of doing business in inner cities.

  Merger Policy
  Mr. Hoyle
  To ask the Chancellor of the Duchy of Lancaster if he has any plans to meet Sir Gordon Borrie, Director General of Fair Trading to discuss merger policy.

  Mr. Maude
  I have no plans at present to meet Sir Gordon Borrie to discuss merger policy. Sir Gordon meets my right hon. and noble Friend the Secretary of State for Trade and Industry, and myself from time to time to discuss matters of mutual interest including mergers policy.

  Manufacturing Industry (Output)
  Mr. Pike
  To ask the Chancellor of the Duchy of Lancaster what are the figures in constant value of the output in manufacturing industries in the north-west(a) in 1979 and (b) at the latest date for which figures are available.

  Mr. Maude
  Gross value added, at constant (1980) prices, for manufacturing industry in the north-west is estimated to have been £9,171 million and £7,453 million in 1979 and 1986 repectively.

  Mr. Watts
  To ask the Chancellor of the Duchy of Lancaster what are the latest figures for the output of manufacturing industry; and what was the comparable figure one year ago.

  Mr. Maude
  In the third quarter of 1988 manufacturing output was at a level of 115·8, based on 1985 equal to 100. This is 7 per cent. higher than the level of 108·3 for third quarter of 1987. Manufacturing output is at its highest ever level.

  Mr. Ernie Ross
  To ask the Chancellor of the Duchy of Lancaster what is his forecast for the growth of manufacturing output in 1988.

  Mr. Maude
  In his Autumn Statement, my right hon. Friend the Chancellor of the Exchequer forecast that manufacturing output would be 7 per cent. higher in 1988 than in 1987.

  Single Market
  Mr. Win Griffiths
  To ask the Chancellor of the Duchy of Lancaster if any attempt has been made to monitor the effectiveness of the advertising campaign of 1992 and the completion of the single market.

  Mr. Andy Stewart
  To ask the Chancellor of the Duchy of Lancaster what monitoring he has undertaken of the level of awareness among business men of the single European market achieved by his Department's Europe Open for Business campaign.

  Mr. Maude
  DTI has a substantial evaluation exercise to monitor the effectiveness of the campaign and the level of business response. This includes a detailed survey of 100 different companies each week.

  Mrs. Gillian Shephard
  To ask the Chancellor of the Duchy of Lancaster what response there has been to his Department's Europe Open for Business campaign.

  Mr. Maude
  The response has been enormous. DTI has received more than 160,000 requests for information since 172
  March, including over 105,000 calls to our 1992 hotline. DTI Ministers and officials are speaking at some 500 conferences and seminars on the single market in the second half of this year.

  Mr. Redmond
  To ask the Chancellor of the Duchy of Lancaster what response has been made by firms in(a) south Yorkshire and (b) the Doncaster area to the campaign on the single European market; what particular action has been taken by his Department to bring this awareness to firms in south Yorkshire so that this area benefits equally as other parts of Britain; and if he will make a statement.

  Mr. Maude
  Since DTI's Europe Open for Business campaign opened in March, we have recorded more than 2,220 individual inquiries from the south Yorkshire area, including 345 from Doncaster. More than 200 senior business representatives attended DTI's regional conference held in Sheffield on 15 November.

  DTI's regional office is active throughout the Yorkshire and Humberside region in arranging and supporting conferences and seminars. Staff from the regional office have been involved in 16 such events in south Yorkshire since 1 September.

  British Coal (Accounts)
  Mr. Harry Barnes
  To ask the Chancellor of the Duchy of Lancaster if he will use his powers under section 11 of the Competition Act 1980 to order an independent investigation by the Monopolies and Mergers Commission of British Coal's accounts with special reference to payments for coalmining subsidence.

  Mr. Maude
  The Monopolies and Mergers Commission has recently completed an inquiry under section 11 of the Competition Act 1980 into British Coal's investment programme. I also understand that the recommendations of the Waddilove committee which examined the corporation's subsidence compensation arrangements are still being followed through. I therefore see no present case for a further section II inquiry.

  EC (Anti-dumping Powers)
  Mr. Teddy Taylor
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the recent decisions of the European Economic Community to impose levies under its anti-dumping powers; and what representations he has received from United Kingdom firms on the issue.

  Mr. Alan Clark
  Since 1 April 1988, six investigations by the European Commission into the alleged injury to Community producers caused by the dumping of goods in the Community have been formally closed with the imposition of definitive anti-dumping duties. Provisional anti-dumping duties have been imposed by the Commission in a further six investigations in the same period.

  Ministers receive representations from time to time both from firms supporting dumping complaints and from those likely to be affected by anti-dumping duties on goods they import.

  USSR
  Mr. Chapman
  To ask the Chancellor of the Duchy of Lancaster if he will give the latest annual figures of the value of exports to and imports from the USSR.

  Mr. Alan Clark
  For the 12 months ended December 1987 exports to the USSR were £491·6 million and imports £875·4 million.

  Interest Rates
  Mr. Turner
  To ask the Chancellor of the Duchy of Lancaster what is the estimated cost to industry of the rise in interest rates since 9 May.

  Mr. Newton
  Bank base rates fell from 8 per cent. to 7½ per cent. on 18 May and have since risen in stages. The cost to industrial and commercial companies to date compared with the cost if base rates had remained at 8 per cent. since 9 May is estimated at about £700 million. The hon. Member should bear in mind that a 1 per cent. interest rate increase, even if sustained for a full year, costs industrial and commercial companies far less than a one percentage point increase in pay settlements.

  Takeovers and Mergers
  Mr. Rooker
  To ask the Chancellor of the Duchy of Lancaster if he has any proposals to change the criteria upon which takeover bids and mergers are referred to the Monopolies and Mergers Commission.

  Mr. Maude
  No. As recently as March this year we published the results of a thorough review of mergers policy and we have no plans for a further review. We concluded that the potential effect on competition should remain the chief criterion for referring mergers and proposed mergers to the Monopolies and Mergers Commission.

  Hotol
  Mr. Wood
  To ask the Chancellor of the Duchy of Lancaster what discussions he has had with the aerospace industry about Hotol.

  Mr. Atkins
  My Department has continuing contacts with industry on this issue.

  Japanese Liquor Tax System
  Mrs. Ewing
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement on progress being made towards the reform of the Japanese liquor tax system as it affects the Scotch whisky industry.

  Mr. Alan Clark
  The intentions of the Japanese authorities to introduce a single rate of tax for all whiskies is well on course for implementation on 1 April 1989.

  Staff Dispersal
  Mr. Cyril D. Townsend
  To ask the Chancellor of the Duchy of Lancaster what is his Department's policy on dispersing staff to the regions; and what proportion of his staff now work outside London.

  Mr. Newton
  The Government's policy is that Civil Service work should be located where it can be done most 174
  cost-effectively and provide the best service to the public. The Government's urban and regional policies are taken into account at an early stage when considering each possible relocation, in consultation with territorial departments and my Department's regional offices.

  The Department has some 12,550 staff in post and about half of them will be working outside central London when the laboratory of the Government chemist completes the move to Teddington which is currently in hand.

  We have taken decisions on moving about a thousand more jobs out of central London. We are also carrying out a thorough review to assess the extent to which other units of the Department may operate more cost-effectively out of London.

  Monopolies and Mergers Commission
  Mr. Wallace
  To ask the Chancellor of the Duchy of Lancaster when he last met the chairman of the Monopolies and Mergers Commission; and what subjects were discussed.

  Mr. Maude
  My right hon. and noble Friend the Secretary of State and I met the chairman of the commission in the course of the year and have discussed matters relevant to the work of the commission.

  Miss Widdecombe
  To ask the Chancellor of the Duchy of Lancaster what action he will take to stop companies who make bids which are referred to the Monopolies and Mergers Commission buying further shares in the market.

  Mr. Maude
  My right hon. and noble Friend has already made clear that in future cases, where mergers are referred to the Monopolies and Mergers Commission and in the past he would have sought undertakings regarding further share purchases, voting or other matters, he proposes to safeguard the conduct of the inquiry by making an appropriate order to come into effect when the reference is announced.

  However, this entails making a new order on each occasion. As the prohibition on further purchases of shares by the bidder is to apply in all appropriate cases, it is proposed to put the prohibition on a permanent footing. It is therefore our intention to include such a prohibition among the provisions relating to mergers in the forthcoming companies legislation.

  Steel Industry
  Mr. Tom Clarke
  To ask the Chancellor of the Duchy of Lancaster when he next expects to meet the Trades Union Congress to discuss the future of the British steel industry; and if he will make a statement.

  Mr. Atkins
  I have no plans at present for such a meeting.

  Latin America and the Caribbean
  Miss Lestor
  To ask the Chancellor of the Duchy of Lancaster what steps he has recently taken to promote trade between the United Kingdom and Latin America and the Caribbean; and if he will make a statement.

  Mr. Alan Clark
  We should like to see a substantial increase of trade with the region and my Department's full range of export services is available to help United Kingdom companies to export there. In the past 12
  175
  months we have supported 23 outward trade missions to, three inward trade missions from and seven exhibitions in, the area. We also give financial support to the Latin American trade advisory group and the Caribbean trade advisory group, which are two of the Department's area advisory groups and do valuable work in promoting United Kingdom exports to Latin America and the Caribbean.

  Small Businesses
  Mr. Harry Greenway
  To ask the Chancellor of the Duchy of Lancaster how many new small businesses have started up in each of the past five years; how many people they employ in(a) Ealing and (b) in total; and if he will make a statement.

  Mr. Atkins
  The latest available estimates provided by the Department of Employment in respect of the numbers of new businesses first registered for VAT are:

  Year

  United Kingdom

  Ealing

  1983

  180,000

  929

  1984

  182,000

  1,090

  1985

  182,000

  1,057

  1986

  191,000

  1,131

  1987

  205,000

  1,311

  Although most of the new businesses are likely to be small the numbers of people they employ is not recorded. Over the period the total numbers of businesses registered in the United Kingdom increased by 11 per cent., while for those registered in Ealing the increase was 38 per cent.

  Consumer Protection
  Mrs. Ann Taylor
  To ask the Chancellor of the Duchy of Lancaster if he has any plans for seeking to extend consumer protection.

  Mr. Forth
  Part III of the Consumer Protection Act 1987 comes into force on 1 March 1989 making it an offence to give misleading price indications. We shall be making regulations under part III governing price indications at bureaux de change and the resale of electricity and gas by landlords. An order will be introduced under the Prices Act 1974 to implement EC directives on unit pricing and price marking of food and non-food products.

  We plan to amend the law on the sale and supply of goods following the Law Commission's report and to amend the Consumer Credit Act and related legislation as detailed in the recent White Paper "Releasing Enterprise" (Cm 512). We shall also introduce revised regulations on pyramid selling.

  In the field of consumer safety, we shall soon be introducing regulations with strict requirements for domestic gas cookers. Regulations on toy safety are being prepared to implement and EC directive. Safety standards for a wide range of consumer products are being updated for the purposes of the general safety requirement in the Consumer Protection Act 1987.

  Car Market
  Mr. Galloway
  To ask the Chancellor of the Duchy of Lancaster what has been the change in the United Kingdom share of the British car market so far in 1988.
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  Mr. Atkins
  In the first 11 months of 1988 the United Kingdom share of the British car market was 43 per cent., compared with 48 per cent. in the same period of 1987.

  North-west (Investment)
  Mr. Hind
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the role and extent of foreign investment in the economy of the north-west.

  Mr. Alan Clark
  I refer my hon. Friend to the reply I gave the hon. Member for Warrington, South (Mr. Butler) in the House on 13 July this year.

  Manufacturing Industry
  Mr. Nellist
  To ask the Chancellor of the Duchy of Lancaster what is the latest figure for the balance of trade in manufactured goods; and what was the comparable figure in 1979.

  Mr. Alan Clark
  Figures for trade in manufactures on a balance of payments basis and seasonally adjusted are:

  £ billion

  Exports

  Imports

  Balance

  12 months to October 1988

  64·5

  78·3

  -13·8

  1979 Year

  30·9

  28·3

  +2·7

  Post Office (Letter Monopoly)
  Mr. Gerald Bowden
  To ask the Chancellor of the Duchy of Lancaster what examination has been undertaken of the Post Office monopoly on the delivery of letters; and if he will make a statement.

  Mr. Newton
  The last public review of the future of the Post Office monopoly on the delivery of letters took place in 1980 and resulted in the suspension of the monopoly until 2006 in respect of letters carried for a charge of not less than £1. We naturally keep the issue of the letter monopoly under review but have no present plans for further change.

  EC (Merger Directives)
  Mr. Grylls
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement on his policy towards the formulation in the European Economic Community of merger directives.

  Mr. Maude
  The Government have reserved their position with regard to the EC Commission's proposals for a merger control regulation. The United Kingdom continues to participate constructively in discussions on the proposal.

  Overseas Companies
  Mr. Maples
  To ask the Chancellor of the Duchy of Lancaster how many overseas companies have set up operations in Britain; and what is his estimate of how many jobs such overseas investment has created and is sustaining.

  Mr. Alan Clark
  Since my Department's Invest in Britain Bureau started formally recording individual investment projects in 1979, there have been 2,463. These
  177
  include the establishment of a new business, the expansion or acquisition of an existing business, and involvement in joint venture. Altogether, from the information provided by the companies themselves, these have been responsible for the creation of over 185,000 jobs and, since 1983, are known to have safeguarded some 95,000 others.

  European Community (Monopolies, Mergers and Restrictive Practices)
  Sir David Price
  To ask the Chancellor of the Duchy of Lancaster what progress is being made in the Council of Ministers of the European Community in determining and then implementing a common policy towards monopolies, mergers and restrictive practices.

  Mr. Maude
  A European policy towards monopolies and restrictive practices is already in place. Discussions on the European Community Commission's proposals for a European merger control regulation were held at the Internal Market Council on 18 November. Some progress was made, but much still remains to be decided. Further discussions will be held at the Internal Market Council on 21 December.

  British Petroleum (Kuwait Investment Office)
  Sir Peter Hordern
  To ask the Chancellor of the Duchy of Lancaster if he has any plan to review his decision that the Kuwait Investment Office should sell its shares in British Petroleum, which amount to more than 9·9 per cent. of the company, within 12 months; and if he will make a statement.

  Mr. Maude
  The report of the Monopolies and Mergers Commission recommended that the Government of Kuwait should be required to reduce their shareholding in British Petroleum over a period of some 12 months. However, in order to promote an orderly disposal of the shareholding, the report also recommended that this period should be subject to some flexibility in the light of market conditions. My right hon. and noble Friend the Secretary of State accordingly asked the Director General of Fair Trading to consult the Kuwait Investment Office on this basis with a view to obtaining undertakings to reduce the shareholding in British Petroleum to not more than 9·9 per cent. and to advise him further on the appropriate time scale for divestment.

  Disabled Persons (Staff)
  Mr. Sean Hughes
  To ask the Chancellor of the Duchy of Lancaster what percentage of the Department of Trade and Industry's staff are classed as disabled.

  Mr. Forth
  The percentage of the Department's staff who are known to be disabled is 1·7 per cent. This figure includes both registered and unregistered disabled officers.

  Data Protection Act
  Mr. Cohen
  To ask the Chancellor of the Duchy of Lancaster why members of his Department are on the interdepartmental group looking at the workings of the Data Protection Act; and whether he will define the concerns of his Department in respect of the Data Protection Act.

  Mr. Forth
  The Department of Trade and Industry's several concerns in the Data Protection Act are reflected 178
  by including in the group reviewing its working officials from the market division for the information technology industry, the division responsible for the protection of consumer interests in domestic and trade policy, and the enterprise and deregulation unit which co-ordinates action across Government to remove unnecessary burdens on business.

  Companies Act 1985
  Mr. Campbell-Savours
  To ask the Chancellor of the Duchy of Lancaster what progress has been made on investigations into alleged offences under the Companies Act 1985 in respect of Messrs. Lewis and Tucker of 16 Hanover square, London W1.

  Mr. Maude
  I am not aware of any Companies Act offences committed by Lewis and Tucker but I shall consider any information the hon. Member may have.

  Mr. Campbell-Savours
  To ask the Chancellor of the Duchy of Lancaster (1) what progress has been made on investigations into alleged offences under the Companies Act 1985 in respect of Wisland Investment Group Ltd.;

  (2) what progress has been made on investigations into alleged offences under the Companies Act 1985 in respect of Bestwood Property Ltd.;

  (3) what progress has been made on investigations into alleged offences under the Companies Act 1985 in respect of Chelwood Holdings Ltd.

  Mr. Maude
  Wisland Property Group Ltd., Bestwood Property Ltd. and Chelwood Holdings Ltd., are overseas registered companies and not subject to United Kingdom company law.

  Mr. Campbell-Savours
  To ask the Chancellor of the Duchy of Lancaster what progress has been made on investigations into alleged offences under the Companies Act 1985 in respect of Royel Investments.

  Mr. Maude
  When Royel Investments Ltd. was incorporated in the style of Growish Ltd. it used the trading name Royel Investments and I refer the hon. Member to my reply yesterday to his question about Growish Ltd.

  Mr. Campbell-Savours
  To ask the Chancellor of the Duchy of Lancaster what progress has been made on investigations into alleged offences under the Companies Act 1985 in respect of Platemede Ltd.

  Mr. Maude
  There is no United Kingdom company registered as Platemede Ltd., but I will consider any information the hon. Member may have.

  Mr. Campbell-Savours
  To ask the Chancellor of the Duchy of Lancaster what progress has been made on investigations into alleged offences under the Companies Act 1985 in respect of Cemetery Assets UK.

  Mr. Maude
  I assume the hon. Member refers to Cemetery Assets UK Ltd. which is currently in default in filing annual accounts and returns. The Registrar of Companies is taking action to strike the company off the register.

  Mr. Campbell-Savours
  To ask the Chancellor of the Duchy of Lancaster what progress has been made on
  179
  investigations into alleged offences under the Companies Act 1985 in respect of Clive Warren Lewis of Lewis and Tucker, 16 Hanover square, London W1.

  Mr. Maude
  I am not aware of any Companies Act offences committed by Mr. Clive Warren Lewis but I shall consider any information the hon. Member may have.

  Multi-fibre Arrangement
  Mr. Kirkwood
  To ask the Chancellor of the Duchy of Lancaster what progress is being made in the negotiations to renew the bilateral trade agreement with China under the terms of the multi-fibre arrangement; and if he will make a statement.

  Mr. Alan Clark
  Negotiations were still in progress in Brussels this morning. They may conclude this afternoon.

  Nissan Vehicles
  Mr. Dykes
  To ask the Chancellor of the Duchy of Lancaster if he will hold urgent talks with his Spanish counterpart concerning delays at the docks in Spain affecting imports of United Kingdom manufactured Nissan motor vehicles.

  Mr. Alan Clark
  My right hon. and noble Friend is pursuing this matter vigorously with the European Commission and the Spanish Minister concerned. We are determined to see the rules of the treaty respected.

  Shares (Disclosure of Interests)
  Mr. Cran
  To ask the Chancellor of the Duchy of Lancaster if he proposes any changes to the law on disclosure of interests in shares following the recent consultation by the Government.

  Mr. Maude
  The Government intend to make two major changes to the law on disclosure of interests in shares, which will be included in this Session's Companies Bill. The level at which interests in shares of companies have to be disclosed will be reduced from 5 per cent. to 3 per cent. The deadline for such disclosure will be shortened from five days to two days.

  I believe that the changes we propose to make will significantly improve market transparency, and will in particular give investors an early indication when a potential offeror purchases a large interest in a company. The Government's policy is to leave merger decisions to the market unless they raise overriding issues of public interest. It is, therefore, important that adequate information should be publicly available as a basis for the market's assessments and decisions. The changes will enable the market to make a fully informed assessment, especially during the vital period prior to the launching of a formal offer. The Government believe that relying on the operation of the market mechanism to assess the merits of takeovers is in the best interests of industry. It is no part of our policy to afford extra protection to the management of companies which are the subjects of takeover offers.

  A further improvement to disclosure would be a change to certain stock exchange rules. These rules limit the ability of companies to restrict the rights of shares when inquiries into share ownership are frustrated. Our consultation has shown that there is significant support for a relaxation of the constraints in this respect that the stock exchange
  180
  places upon listed companies. I am in sympathy with that view. I, therefore, welcome the fact that the stock exchange has agreed to consider changing its rules. The exchange has assured me that it will make an announcement as soon as it has completed its own consultations with interested parties.

  Pirate Radio
  Mr. Evennett
  To ask the Chancellor of the Duchy of Lancaster what representations he has received concerning interference with independent local radio broadcasts by pirate radio operators; and if he will make a statement.

  Mr. Atkins
  [holding answer 6 December 1988] : Several recent representations have been received concerning interference to one independent local radio broadcast station in London.

  My Department's radio investigation service has already acted to remove the source of interference causing a particular problem and it will continue to act vigorously to clear the radio frequencies of unlicensed broadcasters that cause interference, though they always give first priority to dealing with interference to radio systems upon which emergency services depend.

CIVIL SERVICE

  Non-departmental Bodies
  Mr. Baldry
  To ask the Minister for the Civil Service how many non-departmental bodies are currently in existence; and when the annual list of such bodies will be published.

  Mr. Luce
  On 1 April 1988 there were 1,648 non-departmental public bodies. This represents a net increase of five over the previous year, although there are 519 bodies fewer than in 1979. The bodies are listed in "Public Bodies 1988" published today. A copy has been placed in the Library of the House.

  As the Prime Minister announced on 28 January 1988 at column 313-14, the Government will continue to resist proposals for new non-departmental public bodies unless it can be clearly demonstrated that they are the most appropriate and cost-effective solution, and will keep existing bodies under review.

SOCIAL SECURITY

  Family Credit
  Mr. Colin Shepherd
  To ask the Secretary of State for Social Security how many applications for family credit have now been granted since the inception of the scheme; and how many applications are currently awaiting determination.

  Mr. Scott
  By 2 December, 280,986 claims for family credit had resulted in awards and a further 47,925 claims were awaiting determination. In addition, 206,279 family income supplement recipients were awarded family credit without having to make a claim.

  Mr. Allen
  To ask the Secretary of State for Social Security how many individuals claim family credit from each of his Department's offices in Nottingham; and how many individuals are entitled to claim family credit in Nottingham.
  181
  Mr. Peter Lloyd
  Family credit claims are dealt with centrally and information is not available on a local basis.

  Mr. French
  To ask the Secretary of State for Social Security what is the average length of time it takes to process a family credit claim from a self-employed applicant.

  Mr. Peter Lloyd
  [holding answer 2 December]: Just under 34 working days in respect of self-employed cases cleared during November. Of this, less than 11 working days was for work within the family credit branch. The other 23 days were taken up by waiting for responses to inquiries.

  Social Fund Officers
  Mr. Flynn
  To ask the Secretary of State for Social Security (1) how many social fund officers he has nominated under section 32(10) of the Social Security Act 1986; and for what areas;

  (2) what matters relating to the social fund he has specified as matters about which the social fund officer nominated for an area may issue general guidance to other social fund officers in the area.

  Mr. Peter Lloyd
  A total of 454 officers have been nominated under this section. These are the managers or temporary managers of local offices, excluding national insurance offices, who are authorised to issue guidance to other social fund officers on the nature, extent and urgency of the needs in the areas served by their local offices.

  Pensions
  Mr. Andrew Bowden
  To ask the Secretary of State for Social Security what plans he has to abolish the earnings rule for retirement pensions.

  Mr. Peter Lloyd
  None.

  1978–79

  1979–80

  1980–81

  1981–82

  1982–83

  1983–84

  1984–85

  1985–86

  1986–87

  Widow's allowance

  Average number of beneficiaries (thousands)

  36

  37

  34

  34

  33

  32

  31

  30

  30

  Expenditure (£ million)

  65

  75

  80

  84

  80

  83

  84

  84

  87

  Widowed mother's allowance

  Average number of beneficiaries (thousands)

  123

  119

  117

  114

  110

  105

  100

  93

  88

  Expenditure (£ million)

  156

  165

  188

  207 (including £1 million AP)2

  215 (including £3 million AP)2

  222 (including £5 million AP)2

  219 (including £8 million AP)2

  215 (including £11 million AP)2

  214 (including £13 million AP)2

  Death grant (by calendar year)

  Awards (thousands)

  583

  593

  593

  591

  597

  600

  1600

  601

  1600

  Expenditure (£ million)

  16

  16

  16

  17

  17

  17

  17

  18

  18

  Maternity grant

  Awards (thousands)

  622

  659

  654

  1640

  653

  662

  1700

  694

  1560

  Expenditure (£ million)

  16

  16

  16

  16

  16

  17

  18

  17

  14

  1 Estimates.

  2 Records of expenditure on widowed mothers allowance include amounts of additional Pension payable.

  Mrs. Beckett
  To ask the Secretary of State for Social Security if he will publish in the Official Report (a) the most recent figures for numbers of claimants and levels of expenditure, (b) the anticipated end of the year outturn on numbers of claimants and levels of expenditure and (c) the
  182
  Mr. Andrew Bowden
  To ask the Secretary of State for Social Security if he will identify those countries in which annual increments are paid to United Kingdom pensioners without a reciprocal social security agreement existing between the United Kingdom and the country concerned.

  Mr. Peter Lloyd
  Outside the European Community and Sark, pension uprating increases are paid to United Kingdom pensioners only in those countries with which we have a social security agreement that specifically provides for such increases to be paid. Pensions payable to EC nationals living in the Community are uprated by virtue of Community rules. Pensions payable in Sark are increased in line with United Kingdom rates by virtue of a separate provision of the Social Security Benefit (Persons Abroad) Regulations 1975.

  Mr. Bowis
  To ask the Secretary of State for Social Security if he will list the benefits in cash and kind received by pensioners in the United Kingdom and in each country of the European Community.

  Mr. Peter Lloyd
  I refer my hon. Friend to the tables of social benefit systems in the European Communities, a copy of which is in the Library. The tables set out, for the principal schemes, the rates payable from 1 January 1988. Comparative statistics on benefits in kind are not available.

  Allowances and Grants
  Mrs. Beckett
  To ask the Secretary of State for Social Security if he will publish in the Official Report the expenditure and number of claimants for each of the years 1978 to 1987 for (i) widow's allowance, (ii) widowed mother's allowance, (iii) death grant and (iv) maternity grant.

  Mr. Peter Lloyd
  [holding answer 1 December 1988]: The information requested is as follows:

  anticipated numbers of claimants and levels of expenditure for 1988–89 for (i) widow's payment, (ii) widowed mother's allowance, (iii) death grant and (iv) maternity grant.

  Mr. Peter Lloyd
  [holding answer 1 December]: The information is as follows:
  183

  Most recent figures available,1987–88

  Anticipated end of year 1988–89 Figures

  Number of awards

  Levels of expenditure (£ million)

  Number of awards

  Levels of expenditure (£ million)

  Widow's payment

  1n/a

  1n/a

  55,000

  55

  Widowed mothers allowance

  82,000

  210 2(including £15 million AP)

  78,000

  210 2(including £20 million AP)

  Death grant (information is given by calendar year)

  3n/a

  33

  4Nil

  4Nil

  Maternity grant

  4Nil

  4Nil

  4Nil

  4Nil

  1 Widow's payment was introduced in April 1988.

  2 Records of expenditure on widowed mother's allowance include amounts of additional pension payable.

  3 The expenditure on death grant in 1987–88 represents awards for people who died before then but that were paid in the 1987–88 financial year.

  4 Both maternity grant and death grant were abolished from April 1987.

HEALTH

  Pharmaceutical Industry
  Mr. Michael Morris
  To ask the Secretary of State for Health what was the annual return on the pharmaceutical industry's average historic capital employed on National Health Service business in 1987; and what comparable figures he has for the average for United Kingdom private sector industry.

  Mr. Mellor
  I have written to my hon. Friend.

  Hypothermia
  Mr. Andrew Bowden
  To ask the Secretary of State for Health if he will list the number of cases where hypothermia was mentioned on the death certificate for each of the last 10 years for which figures are available; and how many of each annual total were people aged(a) 65 years and over and (b) 80 years and over.

  Mrs. Currie
  The table shows the number of death registrations which contained any mention of hypothermia, by year of registration.

  Number of death registrations with any mention of hypothermia on the death certificate, all ages, aged 65 and over, and aged 80 and over, 1978 to 30 November 1988

  England and Wales

  Year

  All ages

  65 and over

  80 and over

  1978

  708

  597

  327

  1979

  863

  688

  374

  1980

  596

  497

  237

  1981

  685

  574

  326

  1982

  664

  541

  319

  1983

  538

  450

  261

  1984

  555

  462

  257

  1985

  827

  709

  417

  1986

  837

  698

  439

  1 1987

  559

  448

  277

  2 1988

  363

  302

  165

  1 Provisional.

  2 Registration 1 January to 30 November 1988.

  Number of deaths registered in six month periods from 1 April 1978, persons aged 60 to 69, 70 to 79 and 80 and over years

  England and Wales

  Period

  Age group in years

  60 to 69

  70 to 79

  80 and over

  1 April 1978 to 30 September 1978

  54,448

  87,894

  82,065

  1 October 1978 to 31 March 1979

  61,382

  104,655

  103,526

  1 April 1979 to 30 September 1979

  52,658

  88,841

  83,997

  Congenital Abnormalities
  Mr. Cran
  To ask the Secretary of State for Health whether he will make available figures comparing the number of babies suffering from congenital abnormalities born to girls under 16 years of age at the date of delivery with those born to women between the ages of 18 and 35 years.

  Mrs. Currie
  The information is shown in the table for the latest years available. Figures are derived from a voluntary system of notification of congenital malformations observed at birth or up to seven days after birth. They are therefore likely to be an incomplete measure of the total number of affected babies.

  Number of babies notified as being born with congenital malformations by age of mother, England and Wales, 1978–87

  Number of babies

  Year of notification

  Age of mother under 16 years

  Age of mother 18-35 years

  1978

  153

  11,563

  1979

  153

  12,282

  1980

  118

  12,886

  1981

  117

  12,226

  1982

  115

  11,987

  1983

  127

  12,560

  1984

  139

  12,545

  1985

  121

  11,902

  1986

  99

  11,747

  1987

  116

  12,212

  Elderly People (Deaths)
  Mr. Andrew Bowden
  To ask the Secretary of State for Health what was the number of deaths among those aged(a) 60 to 69 years, (b) 70 to 79 years and (c) 80 years and over for each complete six-monthly period from 1 April 1978 to 31 March 1988 for England and Wales.

  Mrs. Currie
  The information is Shown in the table.
  185

  Period

  Age group in years

  60 to 69

  70 to 79

  80 and over

  1 October 1979 to 31 March 1980

  58,348

  101,304

  100,062

  1 April 1980 to 30 September 1980

  52,526

  88,774

  85,433

  1 October 1980 to 31 March 1981

  57,706

  101,403

  104,203

  1 April 1981 to 30 September 1981

  51,003

  87,722

  86,298

  1 October 1981 to 31 March 1982

  57,808

  104,422

  110,338

  1 April 1982 to 30 September 1982

  51,151

  88,023

  88,605

  1 October 1982 to 31 March 1983

  57,482

  103,202

  110,941

  1 April 1983 to 30 September 1983

  50,765

  88,331

  90,264

  1 October 1983 to 31 March 1984

  54,512

  98,956

  106,859

  1 April 1984 to 30 September 1984

  49,190

  87,007

  91,720

  1 October 1984 to 31 March 1985

  55,657

  102,670

  117,664

  1 April 1985 to 30 September 1985

  48,927

  88,249

  96,511

  1 October 1985 to 31 March 1986

  54,149

  102,276

  121,568

  1 April 1986 to 30 September 1986

  49,216

  87,831

  96,419

  1 October 1986 to 31 March 1987

  51,524

  93,959

  109,480

  1 April 1987 to 30 September 1987

  48,083

  84,043

  96,212

  1 October 1987 to 31 March 19881

  54,028

  95,145

  120,229

  1 1988 data is provisional.

  Nurses
  Mr. Macdonald
  To ask the Secretary of State for Health when he next plans to meet representatives of all the nursing unions to discuss the regrading of nurses' pay.

  Mr. Wallace
  To ask the Secretary of State for Health whether he has any plans to meet representatives of the nursing profession to discuss the issue of staff regrading.

  Mr. Mellor
  I refer the hon. Members to the reply to the hon. Member for Peckham (Ms. Harman) by my right hon. and learned Friend the Secretary of State for Health on 5 December at column 82.

  Mr. Meacher
  To ask the Secretary of State for Health how many appeals have so far been heard by region, district health authority, and nationally against gradings issued to nurses; how many have succeeded; and how many have failed.

  Mr. Kenneth Clarke
  We do not hold information on the numbers of appeals heard at health authority level centrally. No appeals against gradings issued as a consequence of the clinical grading exercise have yet been heard at regional appeals committee or Whitley council level.

  VAT
  Mr. Heddle
  To ask the Secretary of State for Health what assessments he has made as to the likely effect on(a) his Department's capital building programme and (b) the rent the Department will pay under occupational leases of implementation of the European Court of Justice's judgment on value added tax on non-domestic buildings.

  Mrs. Currie
  Implementation of the European Court of Justice's judgment, on VAT will have no effect on the Department's capital building programme, since compensating adjustments have been made to the relevant expenditure provisions. At this stage, before landlords have decided whether to exercise their option to tax rents, we cannot offer estimates of the effects of the judgment on rental costs.

  Residential Care Homes
  Mr. Frank Field
  To ask the Secretary of State for Health if he will request his Department's Social Services 186
  inspectorate to carry out a study of the arrangements for health care in non-statutory residential care homes similar to its review of arrangements for health care in local authority residential homes for elderly people carried out in 1986.

  Mr. Mellor
  The social services inspectorate carried out an exercise to examine the use made by local authorities of guidance issued by the Department some years ago. Such guidance has not been formally issued to non-statutory homes and we therefore have no plans to carry out a similar exercise there. We are now considering, in the light of the report on local authority homes, what further action we need to take to ensure good standards of health care in all residential care homes, including those in the non-statutory sector.

  Resources (West Midlands)
  Mr. Snape
  To ask the Secretary of State for Health if, following the publication of the National Health Service management board review of the national allocation formula in July, he intends to implement the resources allocation working party formula such as to reduce future allocations to the west midlands region by approximately £23 million; and if he will made a statement.

  Mr. Mellor
  The Government are considering the recommendations of the National Health Service management board's review of the resource allocation working party formula in the wider context of the National Health Service review.

  Dentists
  Mr. Sean Hughes
  To ask the Secretary of State for Health (1) if he will give the figures for the number of practising dentists(a) joining and (b) leaving the dental lists of family practitioner committees in the latest available five-year period;

  (2) what information he has on the number of general dental practitioners who have left the National Health Service for private dentistry during the last five years.

  Mr. Mellor
  The number of general dental practitioners in England and Wales who joined or left the lists of family practitioner committees in the 12 months up to 30 September of each of the last five years are as follows:
  187

  Year

  Entries

  Exits

  1984

  1,199

  793

  1985

  1,176

  880

  1986

  1,137

  957

  1987

  1,181

  892

  1988

  1,161

  838

  We do not hold information on the number of practitioners who withdrew from an FPC list to practise privately.

  Horticultural Therapy
  Mr. Bowis
  To ask the Secretary of State for Health what financial and others steps he is taking to encourage horticultural therapy; and if he will make a statement.

  Mrs. Currie
  The Department has grant-aided the Society for Horticultural Therapy since 1984. The current grant of £52,000 a year towards the society's project advice and training services was awarded in April 1988 and supports a range of activity including the promotion and dissemination of good practice in the therapeutic rehabilitation of hospital patients.

  NHS Staff (Pay)
  Mr. Corbyn
  To ask the Secretary of State for Health if he will indicate the date on which he first received grading projections from each health authority on the new clinical structure for nurses, midwives and health visitors.

  Mr. Kenneth Clarke
  I first received preliminary and provisional projections during the first two weeks of September.

  Mr. Corbyn
  To ask the Secretary of State for Health if he will publish a breakdown of the new grading structure for nurses, midwives and health visitors broken down by grade, types of hospital including psychiatric, geriatric and acute, by district and region.

  Mr. Mellor
  For the grading breakdown by district and by region, I refer the hon. Member to the answer given to my hon. Friend the Member for Staffordshire, Moorlands (Mr. Knox) on 28 November at column 147-48. We do not hold information on the outcome by type of hospital centrally.

  Salmonella
  Mr. Nicholas Bennett
  To ask the Secretary of State for Health how many cases of salmonella poisoning caused by infected eggs have been reported in each month of 1988; and what percentage of total egg sales these figures represent.

  Mr. Kenneth Clarke
  Reports of food poisoning do not normally identify the food stuff causing the illness. However, in England and Wales, there were 46 outbreaks involving 1,141 people in the first 10 months of 1988 in which the most likely source of infection was uncooked or partially cooked eggs. Recent studies indicate that some sporadic cases of salmonellosis have also been caused by eggs. We also have reason to believe that these figures underestimate the total number of people affected. The monthly breakdown of 1,141 cases is as follows:188

  Number

  January

  27

  February

  —

  March

  —

  April

  60

  May

  302

  June

  159

  July

  207

  August

  145

  September

  114

  October

  127

  Figures of egg sales are not available but the number of eggs produced each year in the United Kingdom is between 12,000-13,000 million. The percentage of reported cases to egg sales is clearly very small.

  Although the risk of harm to any healthy individual from consuming a single raw or partially cooked egg is small, it is advisable for vulnerable people such as the elderly, the sick, babies and pregnant women to consume only eggs which have been cooked until the white and yolk are solid.

  General Practice Finance Corporation
  Mr. Boswell
  To ask the Secretary of State for Health when the Government intends to invite offers for the purchase of the General Practice Finance Corporation.

  Mr. Mellor
  Hambros Bank, on behalf of the Government, will tomorrow issue an information memorandum to those financial institutions and others who have expressed an interest in acquiring the operating business of the General Practice Finance Corporation. The GPFC provides family doctors with a source of funds for the purchase, construction and improvement of their surgery premises in the form of fixed and variable rate loans and acquisition and lease finance.

  An agreement has been reached with the general medical services committee of the British Medical Association providing for its participation in the management of the successor company to the corporation once it is transferred into the private sector. The object is to preserve the ethos of the existing business, maintain its sensitivity to the needs of family doctors, and ensure the operational integrity of the new company in its early years within any group of which it might become part.

FOREIGN AND COMMONWEALTH AFFAIRS

  Disabled Persons (Staff)
  Mr. Sean Hughes
  To ask the Secretary of State for Foreign and Commonwealth Affairs what percentage of his Department's staff are classed as disabled.

  Mrs. Chalker
  In the diplomatic wing of the Foreign and Commonwealth Office 0·3 per cent. of staff are registered disabled people. In the aid wing of the Foreign and Commonwealth Office 1·4 per cent. of staff are registered disabled people.

  Viacheslav Uspensky
  Rev. Martin Smyth
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will raise with the Soviet authorities the case of Viacheslav Uspensky, on
  189
  hunger strike in protest against the refusal of the Soviet Government to grant a visa for himself and his parents to emigrate; and if he will make a statement.

  Mrs. Chalker
  We regularly make representations to the Soviet authorities on behalf of those, such as Viacheslav Uspensky, who are refused permission to leave the Soviet Union. We last raised the case of the Uspensky family at the bilateral consultations in Moscow on 23 June. We shall continue to raise this case at every suitable opportunity including during Mr. Gorbachev's forthcoming visit.

  VAT
  Mr. Heddle
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessments he has made as to the likely effect on(a) his Department's capital building programme and (b) the rent the Department will pay under occupational leases, of implementation of the European Court of Justice's judgment on value added tax on non-domestic buildings.

  Mrs. Chalker
  Implementation of the European Court of Justice's judgment on VAT will have no effect on the Department's capital building programme, since compensating adjustments have been made to the relevant expenditure provisions. At this stage, before landlords have decided whether to exercise their option to tax rents, it is not possible to offer meaningful estimates of the effects of the judgment on rental costs.

  Gibraltar
  Mr. Amos
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will announce the details of the agreement reached on 1 December with the Chief Minister of Gibraltar on the future of the Gibraltar social insurance fund.

  Mrs. Chalker
  Her Majesty's Government and the Government of Gibraltar have established that the state of the social insurance fund is such that it is no longer financially viable. Payments will continue to all beneficiaries at existing cash levels for a further five years. At the end of that time, the fund will be dissolved, and the balance paid out to all past and present contributors, taking account of their accrued rights. Under these arrangements, all beneficiaries will be treated in an equitable and non-discriminatory manner. Her Majesty's Government have agreed to make available the necessary funds to make up any shortfall in the SIF for the duration of these arrangements. The details of dissolution and distribution will now be worked out on the basis of a thorough analysis of the fund's contribution records.

  Internal Market (EC)
  Mr. Redwood
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) if he will list the measures required to complete the internal market for 1992;

  (2) if he will list those of the items identified by the European Commission as being essential to complete the internal market in Europe which have to date been incorporated in (a) European Community and (b) United Kingdom law;

  (3) if he will list those items identified by the European Commission as essential to complete the internal market where agreement has not yet been reached.
  190
  Mr. Maude
  I have been asked to reply.

  I refer my hon. Friend to the reply I gave to the hon. Member for Newham, North-East (Mr. Leighton) at column 440. Since then the following measures have also been agreed by the Council of Ministers:

  Control of Goods
  Directive amending Directive 77/93 on protective measures concerning entry into Member States or organisms harmful to plants or plant products. [adopted]

  Removal of Technical Barriers
  Food for particular nutritional use (amendment).[common position]
  Food labelling (amendment). [common position)
  Two (concerning proprietary and immunological medicinal products) of a package of four proposals on the extension of directives to medicinal products not already included. [common position]
  The following measures are either currently in force in the United Kingdom or legislation has been made or administrative action taken to bring them into force by the required implementation dates.

  Control of Goods
  Duty-free admission of fuel contained in the fuel tanks of commercial motor vehicles: lorries and coaches*.
  Single Administrative document (SAD) third country aspects.
  Simplification of Community transit procedure: amendment to Reg 222/77.
  Abolition of customs presentation charges.
  Elimination of customs formalities in the framework of the TIR Convention and the Introduction of common border posts—"banalisation".
  Live animals of the bovine species: amended eradication directives to provide for final eradication of brucellosis, tuberculosis and leukosis.
  Eradication of classical swine fever in the Community as a whole and swine fever.
  Hormone growth promoters.
  Medical examination of Personnel.
  Antibiotic residues.
  Control of residues.
  Swine fever.
  Control of foot and mouth disease.
  Amendment to Directive 77/93 (plant health).
  Maximum levels for pesticide residues in cereals and foodstuffs of animal origin.
  Amendment of Directive 79/117/EEC on the prohibition of certain plant protection products (ethylene oxide).
  Proposal for Directive on the fixing of guidelines for the evaluation of additives used in animal foodstuffs.
  Modification of Directive 72/461 on health problems affecting Intra-Community trade in fresh meat and Directive 72/462 on health and veterinary inspection problems upon importation of bovine animals and swine and fresh meat from 3rd countries.
  Acceptance for breeding purposes of purebred breeding animals of the bovine species.
  Amendment to Directive 80/215 on animal health problems affecting Intra-Community trade in meat products.
  Amendment to Directive 74/63 on undesirable substances and products in animal nutrition (maximum pesticide residues in animal feeding-stuffs).
  Semen of animals.

  Control of Individuals
  Sixth Directive relative to exemptions in international travel: increase to 350 ECUs.
  Tax reliefs to be allowed on the importation of goods in small consignments of a non-commercial character.

  The Removal of Technical Barriers
  Proposal for the extension of information procedures on standards and technical rules (amendment to Directive 83/189)
  Type approval of motor vehicles and their trailers, Directive 70/156

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  Directive on the approximation of laws relating to weights and dimensions of certain motor vehicles
  Modification of tractors framework Directive 74/150
  General Directive on sampling and methods of analysis Emulsifiers (modification)
  Coffee extracts chicory extracts (modification)
  Proposal for Directive concerning the placing on the market of high-technology medicinal products including those derived from biotechnology
  Proposal amending Directive 75/318/EEC concerning the testing of medical specialities
  Proposal amending Directive 81/852/EEC concerning veterinary medicinal products
  Proposal for a Council Directive amending Directive 65/65/EEC concerning medical specialities
  Council Directive relating to restrictions on the marketing and use of PCB's (polychlorinated biphenyls)
  Council Directive relating to "Restrictions on the marketing and use of asbestos"
  Non-ionic detergents (modification of existing Directive)
  Tyre pressure gauge
  Hydraulic diggers (noise)
  Good laboratory practices—non-clinical testing of chemicals

  Free Movement for Labour and the Professions
  Comparability of vocational training qualifications
  Co-operation between higher education and industry for advanced training relating to new technologies (COMETT)
  Co-ordination of provisions in respect of certain activities in the field of pharmacy
  Mutual recognition of diplomas in pharmacy

  Common Market for Services
  Collective investment undertakings for transferable securities UCITS Directive: special measures concerning certain investments.

  Transport
  Fares for scheduled air services.
  Air transport: sharing of passenger capacity and market access
  Air transport: application of Articles 85 and 86 (rules of competition).
  Maritime transport:

  1. freedom to provide services in the sea transport sector: between Member States and between Member States and third countries.

  2. application of Articles 85 and 86 of Rome Treaty to maritime transport.

  3. unfair pricing practices.

  4. co-ordinated action to safeguard free access to cargoes in oceanic trades.

  Road transport: organisation of the market (Community quota) for the carriage of goods by road between Member States: transitional and final stages [except in so far as all Community quotas and bilateral quotas between Member States will not be abolished until 1 January 1993].

  Capital Movements
  Liberalisation of units in collective investment undertakings for transferrable securities.
  Liberalisation of operations such as transactions in securities not dealt in on a Stock Exchange, admission of securities of the capital market and long-term commercial credits.
  Liberalisation of capital movements

  Other Areas
  Legal protection of micro circuits.

  Fiscal Measures
  13th VAT Directive concerning tax refunds to persons not established in the Community.
  17th VAT Directive concerning the temporary importation of goods other than means of transport.
  In addition the following measures do not require implementation by the United Kingdom because they are recommendations, or action is for other Member States or the Commission.
  192
  Control of Goods
  Live animals of the porcine species: eradication of African swine fever in Portugal.
  Live animals of the porcine species: eradication of African swine fever in Spain.

  The removal of technical barriers
  Proposals for a Council Recommendation concerning tests relating to the placing on the Market of medical specialties.
  Membership of the European Pharmacopeia
  Membership of the European Agreement on detergents
  Protection of hotels against fire

  New technologies and services
  Recommendation on a European Code of Conduct relating to electronic payment (relations between financial institutions, traders and service establishments and consumers).
  Establishment at Community level of a policy and plan of priority action for the development of an information services market.

  Fiscal measures
  Harmonisation of the structure of excise duties on alcoholic drinks (FOD Rum)

  Mr. Redwood
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list those items in the internal market programme which he intends to oppose in the Council of Ministers.

  Mr. Maude
  I have been asked to reply.

  The Government strongly supports the aim of completing the Single Market. We attach priority to many of the proposals made by the European Commission, but have difficulties with some others—as do other Member States. Many measures in the Single Market Programme are complex and all involve detailed negotiation. It would not therefore be possible to present the information in the form requested.

ENERGY

  Nuclear Reactors (Decommissioning)
  Mr. Hinchliffe
  To ask the Secretary of State for Energy what progress he has made towards the production of safety specification guidelines for the decommissioning and disposal of British nuclear reactors operated by the United Kingdom Atomic Energy Authority in the event that such decommissioning and disposal becomes necessary; and if he will make a statement.

  Mr. Michael Spicer
  The United Kingdom Atomic Energy Authority determines the need for the decommissioning of its reactors as part of its overall technical programme and addresses the safety of such operations within well established procedures for safety management.

  Mr. Angelo Casfikis
  Mr. Flynn
  To ask the Secretary of State for Energy if he will list details of the occasions when he, or other Ministers in his Department, met Mr. Angelo Casfikis to discuss the reopening of Central Electricity Generating Board coal-fired power stations.

  Mr. Michael Spicer
  Mr. Casfikis has met Ministers here on five occasions:10 February 1987, 19 January 1988, 17 March 1988, 15 April 1988, and 30 September 1988.

  Mr. Flynn
  To ask the Secretary of State for Energy if he will list all communications made by his Department to
  193
  the Central Electricity Generating Board concerning the proposal by Mr. Angelo Casfikis and the I.P.E. Company to generate electricity under the terms of the Energy Act 1983.

  Mr. Michael Spicer
  My Department has been in regular touch with the CEGB, in particular in response to points raised by the hon. Member.

  Coal-fired Power Stations
  Mr. Flynn
  To ask the Secretary of State for Energy what steps he has taken to vary the environmental conditions required to operate new or reopened coal-fired power stations and to encourage other responsible bodies to vary these.

  Mr. Michael Spicer
  None. It is the responsibility of Her Majesty's inspectorate of pollution to determine the level of atmospheric emission control equipment to be fitted to such stations.

  Electricity Generation
  Mr. Flynn
  To ask the Secretary of State for Energy what is his estimate of the proportion of the future supply of electricity he expects to be generated under the terms of the Energy Act 1983 in(a) 1990, (b) 1995 and (c)

  Mr. Michael Spicer
  My Department does not publish such estimates. Experience of the energy market has shown that changes in the future composition of energy production cannot be forecast with any certainty.

  Mr. Flynn
  To ask the Secretary of State for Energy if he will consider amending the Energy Act 1983 to ensure the appropriate firm safeguards are required of future aspirant power generating companies to provide(a) security of the power supply, (b) high standards of pollution control and (c) financial security and propriety.

  Mr. Michael Spicer
  Clause 15 of the Electricity Bill will impose an obligation to supply on the public electricity suppliers, instead of the generators as now. Privatisation will make no difference to the environmental standards which the electricity industry has to meet. It will be required to meet United Kingdom emissions standards and will be subject to an amenity obligation similar to section 37 of the 1957 Electricity Act. Clause 3 of the Electricity Bill gives the Secretary of State and Director General of Electricity Supply a duty to secure that licence holders are able to finance the carrying on of the activities which they are authorised by their licences to carry on.

  Mr. Flynn
  To ask the Secretary of State for Energy if he will list the approaches that have been made by his Department in(a) 1986, (b) 1987 and (c) 1988 to the Central Electricity Generating Board to encourage the implementation of competition in electricity generation as envisaged in the Energy Act 1983.

  Mr. Michael Spicer
  The CEGB is fully aware of its statutory responsibilities under the 1983 Energy Act.

  Mr. Flynn
  To ask the Secretary of State for Energy what information he has as to the number of new electricity generating units that(a) have been introduced or (b) are planned to be introduced as a consequence of the Energy Act 1983.
  194
  Mr. Michael Spicer
  The number of private generators selling to area boards has almost doubled from 59 to 103 since the 1983 Energy Act. We are aware of some 16 new proposed private generation projects which would total over 6GW of new capacity; most of these have come forward since the Government's intention to privatise the industry was announced.

  Electricity Transmission
  Mr. Patrick Thompson
  To ask the Secretary of State for Energy whether he has received the Central Electricity Generating Board's second response to the report by the Monopolies and Mergers Commission on the efficiency and costs of transmission of electricity.

  Mr. Michael Spicer
  The Central Electricity Generating Board has sent me its second response to the report which was published on 26 June 1987. Copies of the response have been placed in the Library.

  The board's response summarises the action which the board has taken and is continuing to take. Of the five areas identified by the commission requiring priority action, progress has been made as follows:

  1) Clear Definition of Board Responsibilities

  The board will continue to ensure that the responsibilities of executive board members are clearly defined and understood up to the vesting of the CEGB's successor bodies. The CEGB has also identified the senior management of the successor bodies. It is important, particularly in view of the period of change that the industry is presently undergoing, that board members' responsibilities remain clearly defined.

  2) Future Management of the Five Centre Grid Control Project

  The board announced in June 1988 that it had awarded the contract for its five centre grid control project to Control Data Corporation. The CDC system will provide a single fully integrated computer system to support the operation and control of the high voltage grid transmission system. When operational the system will continuously collect, display and calculate information about power flowing through the network and the state of the network itself. The system will provide an effective mechanism with which to manage the grid.

  3) Year to Year Changes in Transmission Plans, and

  4) Fluctuations in estimated Plant and Equipment Requirements

  Initial work on reviewing the board's last five transmission plans is expected to be complete by the end of this year. My Department will keep in touch with the progress of the review.

  5) Approach to Budget Setting

  The board has introduced a new project appraisal system which ensures that all projects are carefully analysed and re-examined. To ensure compliance with tight financial disciplines the board has increased the size of its audit function.

  The board has responded positively to the recommendations made by the MMC and has made good progress in the fields of system operation and planning. I welcome the board's response and the progress it is making towards meeting the recommendations of the commission.

  Since the board's first response the Government have announced their proposals to privatise the electricity supply industry, under which the board's transmission

  195
  system will be managed by a new transmission company. These proposals represent major changes in the organisational structure of the industry, including the management of the transmission system, and the board's second response takes account of these proposed changes. In view of these impending changes it is unlikely that the board will be called upon to produce a third response although my Department will keep in touch with the board on progress towards meeting the MMC recommendations.

NORTHERN IRELAND

  Plastic Bullets
  Ms. Short
  To ask the Secretary of State for Northern Ireland how many plastic bullets have been fired each year since they first came into use in Northern Ireland.

  Mr. Ian Stewart
  Since the introduction of plastic baton rounds in 1973, the security forces have fired 54,234 (to 31 October 1988). The annual figures are:

  Numbers of plastic baton rounds fired

  Year

  Number

  1973

  42

  1974

  216

  1975

  3,556

  1976

  3,464

  1977

  1,490

  1978

  1,743

  1979

  1,271

  1980

  1,231

  1981

  29,695

  1982

  500

  1983

  661

  1984

  1,768

  1985

  1,172

  1986

  1,785

  1987

  2,575

  1988 1

  3,065

  54,234

  1 to 31 October 1988

  Rathlin Island
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland what plans he has to provide mains electricity to Rathlin Island; whether the survey report prepared by Northern Ireland Electricity is available; and if he will make a statement.

  Mr. Viggers
  Northern Ireland Electricity has been evaluating methods of supply for Rathlin and is presently studying the results of a hydrographic survey, the implications of which, when known, will be discussed with representatives of the islanders.

  Prisons
  Mr. Peter Robinson
  To ask the Secretary of State for Northern Ireland what staff and medical care facilities would be required for an industrial or commercial business of comparable size and work force to that of each of Northern Ireland's prisons; and how far short of that level are the staffing and facilities of each of those prisons.

  Mr. Ian Stewart
  Regulations made under the Health and Safety at Work (NI) Order 1978, require employers to provide certain minimum levels of first aid facilities for 196
  employees who are injured or become ill at work. The first aid facilities provided in each of Northern Ireland's prisons exceed the minimum requirements.

  Business Plans
  Mr. Beggs
  To ask the Secretary of State for Northern Ireland if he will publish the names of accountancy firms in Northern Ireland which have submitted business plans or proposals in each of the last three years to the Local Employment Development Unit and the Industrial Development Board on behalf of clients.

  Mr. Viggers
  Information in the form requested is not readily available and could only be compiled at disproportionate cost.

  Mr. Peter Clifford
  Mr. Tony Banks
  To ask the Secretary of State for Northern Ireland (1) what explosive substances were found in the car in which Peter Clifford was a passenger on 8 November; and what checks were made on his clothes;

  (2) why Peter Clifford was arrested near Long Kesh on 8 November; what charges were made against him; and for how many hours he was detained;

  (3) what happened to the finger-prints taken from Peter Clifford in Gough barracks on 8 November; and what records are kept of his arrest and interrogation;

  (4) what questions were asked of Peter Clifford during interrogation at Gough barracks; and what documents he signed.

  Mr. Ian Stewart
  [holding answers 25 November 1988] : A routine Army patrol operating close to Her Majesty's prison Maze near Lisburn, on 8 November stopped and searched a vehicle in which Mr. Clifford was a passenger. Traces of what was thought to be an explosive substance were found in the vehicle. The vehicle's occupants were subsequently arrested and the vehicle was taken for further examination. Following forensic examination of the vehicle and Mr. Clifford's clothing, it was established that the material discovered was not an explosive substance.

  Mr. Clifford was initially detained under section 14 of the Northern Ireland (Emergency Provisions) Act 1978 for a period of four hours and subsequently arrested under section 12 of the Prevention of Terrorism (Temporary Provisions) Act 1984.

  He was detained at 1409 hours on 8 November and released at 1300 hours on 9 November and therefore remained in custody for just under 24 hours. He was released without charge.

  Whilst he was in custody, Mr. Clifford's fingerprints were taken and in accordance with normal procedure these have now been destroyed. Procedural records of his arrest and detention have been retained. During police interview Mr. Clifford was asked a number of questions about the substance found, his identity and the reasons for this presence in that particular area. Before his release Mr. Clifford signed a number of official forms relating to his detention. I now understand that Mr. Clifford has lodged a formal complaint in relation to his detention and this is being investigated by the police.

ENVIRONMENT

  Radon
  Mr. Redmond
  To ask the Secretary of State for the Environment (1) how many households in Yorkshire have been recorded as being over the recommended safety limit in respect of radon; and if he will list their locations;

  (2) if he will list any sites in Yorkshire that have been identified as being over the safety limit in respect of radon; and what radiation levels were recorded.

  Mrs. Virginia Bottomley
  The National Radiological Protection Board surveys in the three Yorkshire counties have led to the discovery of one house, in west Yorkshire, with a radon concentration at the action level at 400 bequerels per cubic metre. In the county as a whole, concentrations are almost exactly the national average.

  Pollution Control (Self-Regulation)
  Mr. Hinchliffe
  To ask the Secretary of State for the Environment if he intends to allow private industry to self regulate pollution control methods; how he would monitor such voluntary actions; and whether he will consider the application of stricter legislative controls on environmentally hazardous emissions.

  Mrs. Virginia Bottomley
  Legislative controls over hazardous emissions already exist. Where monitoring is undertaken by industry as part of the control system, it is policed by the pollution control authority. Proposals currently being developed on an integrated system for controlling industrial pollution will make this framework more efficient and effective.

  Radioactivity
  Mr. Allen
  To ask the Secretary of State for the Environment if he will list the premises in Nottingham which are authorised under the Radioactive Substances Act 1960.

  Mrs. Bottomley
  A list of all premises in England and Wales authorised under the Radioactive Substances Act 1960 was published by the Department in April 1988 and a copy was placed in the Library of the House.

  Mr. Allen
  To ask the Secretary of State for the Environment what is the function of the RIMNET station at Watnall, Nottingham.

  Mrs. Virginia Bottomley
  The function of the RIMNET station of Watnall is to measure gamma dose rate.

  Mr. Alton
  To ask the Secretary of State for the Environment whether RIMNET stations can detect(a) particulate radioactivity, (b) gaseous radionuclides and (c) radionuclides with short half-lives.

  Mrs. Virginia Bottomley
  The RIMNET monitors detect particulate and gaseous radionuclides which emit gamma radiation. They are able to detect both short and long-life radionuclides.

  Mr. Alton
  To ask the Secretary of State for the Environment if he will list the monitoring equipment used by RIMNET; and if he will make a statement on the future of RIMNET.
  198
  Mrs. Virginia Bottomley
  RIMNET sites are currently equipped with Geiger-Muller gamma dose rate monitors. The proposals for the development of RIMNET are set out in the DOE booklet "Nuclear Accidents Overseas—The National Response Plan and Radioactive Incident Monitoring Network (RIMNET). A Statement of Proposals", a copy of which has been placed in the Library of the House.

  Mr. Allen
  To ask the Secretary of State for the Environment if he will list the sites where his Department conducts random monitoring for radioactivity in Nottingham other than at premises authorised under the Radioactive Substances Act 1960; and if he will make a statement.

  Mrs. Virginia Bottomley
  Nottingham's drinking water is monitored regularly by HM inspectorate of pollution under the national environmental radioactivity monitoring programme. The effects of all liquid discharges in the Nottingham area are monitored by sampling the river Trent. No other monitoring for radioactivity is warranted.

  Homelessness
  Ms. Quin
  To ask the Secretary of State for the Environment what new proposals he has developed to tackle homelessness.

  Mr. Trippier
  A review of the current homelessness legislation is under way. As yet, it is too early to say whether this will result in any new, national initiatives.

  Single Market
  Mr. Blunkett
  To ask the Secretary of State for the Environment what plans his Department has to give advice and guidelines to local authorities on the implications for them of the introduction of the single European market in 1992; and if he would make a statement.

  Mrs. Virginia Bottomley
  The Department will shortly be discussing this matter with representatives of the local authority associations.

  Global Developments
  Mr. Harry Barnes
  To ask the Secretary of State for the Environment if he will publish an annual progress report on how his Department's policies, programmes and spending are directed towards global sustainable developments.

  Mrs. Virginia Bottomley
  I refer the hon. Gentleman to the answer I gave to the hon. Member for Southport (Mr. Fearn) on 30 November 1988 at column 283.

  Planning Appeals (Hampshire)
  Sir David Price
  To ask the Secretary of State for the Environment how many planning appeals relating to Hampshire were made to his Department in 1987; how many were determined; how many were allowed; and what has happened to those not determined.

  Mr. Howard
  A total of 1,124 planning appeals relating to Hampshire were lodged in 1987, but 186 of these have been withdrawn. Of the remainder, 351 were allowed, 570
  199
  were dismissed and 17 are still to be determined. Those appeals still to be decided are either in abeyance (at the request of the parties) or are in the final stages of processing.

  Clay Pigeon Shooting
  Sir Nicholas Bonsor
  To ask the Secretary of State for the Environment if he will annul the General Development Order 1988 to ration permitted days use of land for clay pigeon shooting to 28.

  Mr. Chope
  The General Development Order 1988 came into operation on 5 December. We intend to consult shortly on whether to amend it so as to increase from 14 to 28 the maximum number of days in a year on which land may be used for clay pigeon shooting without planning permission.

  Rating Reform
  Mr. Rooker
  To ask the Secretary of State for the Environment if he will make a statement on progress on his consultations regarding the draft poll tax regulations.

  Mr. Gummer
  We are currently consulting the local authority associations and other bodies on draft regulations covering the administration and enforcement of community charges. Consultation on further regulations will follow shortly.

  Housing Statistics
  Mr. Simon Hughes
  To ask the Secretary of State for the Environment what are the most recent figures he has for the number of dwellings owned by(a) the London residuary body, (b) the Inner London education authority, (c) central Government Departments and (d) housing associations, which are unlawfully occupied in each London borough.

  Mr. Trippier
  This information is not held by the Department.

  Sewage Works
  Mr. Hanley
  To ask the Secretary of State for the Environment whether he is yet in a position to make a further statement on his policies for improving the performance of sewage treatment works in England and Wales.

  Mr. Howard
  Yes. There will be capital programmes involving expenditure of £900 million to £1,000 million designed to bring substandard works into compliance with their legal limits by March 1992. But in some cases, because of the scale of the design and construction work which is necessary, it will not be possible to complete the work by this date. In those cases, completion will be achieved as soon as practically possible thereafter. The Government will be discussing with water authorities the detailed timetables for their programmes.

  Applications for temporary variations in consent conditions will be considered in cases where improvement works are programmed for completion by March 1992. This is the best way of securing rapid completion of major investment programmes while protecting river quality.

  Upper tier conditions in time-limited consents will also be introduced as a new maximum limit for effluent
  200
  standards. These will be set at levels which ensure the protection of the receiving waters against excessive discharges. Water authorities exceeding their limits will be at risk of prosecution.

  Direct Labour Organisations
  Mr. Hind
  To ask the Secretary of State for the Environment what amendments he will be seeking to make to the regulations made under the Local Government, Planning and Land Act 1980 relating to direct labour organisations, in the light of consultation.

  Mr. Gummer
  My right hon. Friends the Secretaries of State for the Environment and Wales have now decided, in the light of a consultation exercise carried out earlier this year, that all building and maintenance work other than highways and sewerage work should be subject to competition from October of next year and that the present exemption for direct labour organisations with not more than 30 employees should be reduced to 15 employees.

  We are also prohibiting authorities from renewing maintenance contracts with their direct labour organisations without first going out to tender. We are examining the scope for restricting the kinds of emergency work which can be carried out by direct labour organisations without open competition.

  The present regulations, made under part III of the Local Government Planning and Land Act 1980, have been in force since 1983 and the Government feel that there is no longer a case for any competition-free allowance for this work. Some authorities already expose all their maintenance and minor construction work to competition.

  We estimate that an extra £400 million of work would be exposed to compulsory competition each year. A 30-employee de minimis threshold no longer seems justified. This could allow an authority to carry out work worth £600,000 a year without competition.

  Local Authority Rents
  Sir Ian Gilmour
  To ask the Secretary of State for the Environment if he will publish a table showing average local authority rents at 1987–88 prices, for each year since 1967–68.

  Mr. Trippier
  [holding answer 6 December 1988]: Average weekly unrebated rents for English local authorities, revalued to 1987–88 prices using the retail prices index, are as follows:

  £per week

  1967–68

  11·23

  1968–69

  11·63

  1969–70

  12·01

  1970–71

  12·49

  1971–72

  12·33

  1972–73

  12·75

  1973–74

  15·01

  1974–75

  13·51

  1975–76

  12·24

  1976–77

  12·18

  1977–78

  12·15

  1978–79

  11·85

  1979–80

  11·26

  1980–81

  12·22

  1981–82

  15·43

  1982–83

  16·97

  201

  £ per week

  1983–84

  16·75

  1984–85

  16·81

  1985–86

  16·77

  1986–87

  17·14

  1987–88

  17·36

AGRICULTURE, FISHERIES AND FOOD

  Fish (Contamination)
  Mr. McTaggart
  To ask the Minister of Agriculture, Fisheries and Food what measures his Department is taking to monitor the level of contamination of fish landed at British ports; and if he will make a statement.

  Mr. Donald Thompson
  Scientists from my Department carry out a regular monitoring programme to assess the quality of fish and shellfish in terms of contaminant concentrations. Results of this programme are published at regular intervals in aquatic environment monitoring reports which are available in the Library of the House.

  The information gathered over almost 20 years has shown that levels of contaminants are low and that the quality of our fish complies fully with European Community environmental quality standards and national guidelines.

  Fishing Vessels
  Mr. Austin Mitchell
  To ask the Minister of Agriculture, Fisheries and Food what EEC funding for the buying up of fishing vessels is available under regulation 4028/86; how many British vessels have been able to take advantage of this; and what proposals he has for allowing more British fishing vessels to do so.

  Situation at 1 January 1987

  Reduction required at 1 January 1987

  Situation at 30 June 1988

  Reduction required at 30 June 1988

  United Kingdom

  GRT

  151,823

  -10,203

  168,806

  -27,186

  KW

  789,241

  -40,996

  863,199

  -114,954

  Denmark

  GRT

  136,488

  -17,088

  130,554

  -11,154

  KW

  571,996

  -56,696

  555,212

  -39,912

  France

  GRT

  192,953

  -5,930

  195,488

  -8,465

  KW

  988,418

  -92,698

  1,037,220

  -141,500

  Netherlands

  GRT

  77,500

  -12,704

  1

  1

  KW

  462,900

  -80,622

  443,620

  -61,342

  1 Information not yet available.

  Potato Marketing Board
  Mr. Redmond
  To ask the Minister of Agriculture, Fisheries and Food what has been the overall response to his consultation paper regarding the Potato Marketing Board; and whether he proposes to accept the majority or minority views expressed on the options suggested.

  Mr. Ryder
  The period for the response to the consultation paper on future potato market policy in Great Britain does not expire until 31 December 1988, and there are clearly many replies yet to be received.
  202
  Mr. Donald Thompson
  The Commission has allocated 100 mecu (£65 million) over a five-year period from 1987 to 1991 under regulation 4028/86 for the buying up (decommissioning) of fishing vessels. The United Kingdom has not implemented this particular measure and at present we have no plans to do so.

  Mr. Austin Mitchell
  To ask the Minister of Agriculture, Fisheries and Food how many Spanish-owned vessels are currently on the register of British fishing vessels; what ports they fish from; and in which quota sectors they operate.

  Mr. Donald Thompson
  There are at present approximately 150 fishing vessels on the British register which are believed to be beneficially Spanish owned. Of these 97 are licensed to fish for stocks subject to quotas.

  The vessels operate mainly in Western waters (ICES areas VI, Vb, VII and VIII) taking substantial quantities of hake, megrim and anglerfish. They also catch significant quantities of haddock and saithe from areas VII and VIII plus some whiting from area VII (exc VIIa), cod VII (exc VIIa) and VIII and sole VIIfg.

  Whilst the majority of the vessels are nominally based in the ports of Milford haven, Plymouth or Fleetwood, the majority of their catches are landed and sold at ports in Northern Spain.

  Mr. Austin Mitchell
  To ask the Minister of Agriculture, Fisheries and Food what reduction of number of fishing vessels and what proportion of the reduction has been secured to date in the multi annual guidance programmes for fishing for(a) the United Kingdom, (b) Denmark, (c) France and (d) Holland.

  Mr. Donald Thompson
  The information requested is only readily available as follows:

  Aldrin
  Mr. Alton
  To ask the Minister of Agriculture, Fisheries and Food if he will ban the use of the pesticide Aldrin immediately; and if he will make a statement.

  Mr. Ryder
  Three minor pesticide uses of aldrin are currently permitted until the end of 1992, when approval for these uses will be revoked. This interval is intended to permit alternative treatments to be developed and growers' stocks to be used up safely. No further opportunity can be allowed.

NATIONAL FINANCE

  Domestic Credit
  Mr. Austin Mitchell
  To ask the Chancellor of the Exchequer whether he will publish in the Official Report a table showing for each quarter since 1 January 1986 the contribution made to the expansion of domestic credit by the overseas sector.

  Mr. Lilley
  I refer the hon. Member to my reply to his earlier question on 9 November 1988 at column 240.

  Smokeless Fuels
  Ms. Walley
  To ask the Chancellor of the Exchequer if he will take steps to provide a tax incentive in favour of premium smokeless fuels; and if he will make a statement.

  Mr. Lilley
  Premium, smokeless fuel, like other forms of fuel and power, are zero-rated for VAT purposes. They are not liable to any other form of indirect taxation.

  Disabled Persons (Staff)
  Mr. Sean Hughes
  To ask the Chancellor of the Exchequer what percentage of Her Majesty's Treasury staff are classed as disabled.

  Mr. Brooke
  The current figure for the Treasury is 1·4 per cent.

  Overseas Assets
  Mr. Yeo
  To ask the Chancellor of the Exchequer what are the latest figures for the stock of net overseas assets.

  Mr. Major
  At the end of 1987 the United Kingdom's net stock of overseas assets was worth £89½ billion, or 21 per cent. of GDP. These assets generated earnings of £5½ billion in 1987. The surplus on invisibles in 1986 and 1987 was the largest in the world.

HOME DEPARTMENT

  Civil Defence
  Mr. Redmond
  To ask the Secretary of State for the Home Department (1) which local authorities have applied for grant-aid for the purpose of establishing, equipping or maintaining emergency centres, pursuant to regulation 4(1)(b) of the Civil Defence (General Local Authority Functions) Regulations 1983, since 2 December 1985;

  (2) which local authorities have been given grant-aid for the purpose of establishing, equipping or maintaining emergency centres, pursuant to regulation 4(1)(b) of the Civil Defence (General Local Authority Functions) Regulations 1983, since 2 December 1985; and what was the amount of such grant.

  Mr. John Patten
  The local authorities which have applied for and been given grant aid for this purpose are listed. Details of grants paid in respect of these centres, for each local authority and over the particular period quoted, could be obtained only at disproportionate cost.

  Counties and fire and civil defence authorities which have applied for and been given grant are as follows:
  Avon, Bedfordshire, Berkshire, Buckinghamshire, Cambridgeshire, Cheshire, Cleveland, Clwyd, Cornwall,
  204
  Cumbria, Derbyshire, Devon, Dorset, Durham, Dyfed, Essex, Mid Glamorgan, South Glamorgan, West Glamorgan, Gloucestershire, Greater Manchester, Gwent, Gwynedd, Hampshire, Hereford and Worcester, Hertfordshire, Humberside, Isle of Wight, Kent, Lancashire, Leicestershire, Lincolnshire, London, Merseyside, Norfolk, Northamptonshire, Northumberland, Nottinghamshire, Oxfordshire, Powys, Shropshire (Salop), Somerset, Staffordshire, Suffolk, Surrey, East Sussex, West Sussex, Tyne and Wear, Warwickshire, West Midlands, Wiltshire, North Yorkshire.

  Mr. Redmond
  To ask the Secretary of State for the Home Department (1) which local authorities have applied for grant-aid for the purpose of establishing, equipping or maintaining emergency centres, pursuant to regulation 5(1)(c) of the Civil Defence (General Local Authority Functions) Regulations 1983, since 2 December 1985;

  (2) which local authorities have been given grant-aid for the purpose of establishing, equipping or maintaining emergency centres, pursuant to regulation 5(1)(c) of the Civil Defence (General Local Authority Functions) Regulations 1983, since 2 December 1985; and what was the amount of such grant.

  Mr. John Patten
  Civil defence grant is normally claimed by county authorities and fire and civil defence authorities on behalf of district level authorities. The local authorities which have applied for and been given grant in respect of district level emergency centres are listed. Details of grant paid in respect of these centres, for each local authority and over the particular period quoted, could be obtained only at disproportionate cost.

  Counties and fire and civil defence authorities which have applied for and been given grant are as follows:
  Avon, Berkshire, Buckinghamshire, Cambridgeshire, Cleveland, Clwyd, Cornwall, Cumbria, Derbyshire, Devon, Dorset, Durham, Dyfed, Essex, Gloucestershire, Greater Manchester, Gwent, Gwynedd, Hampshire, Hereford and Worcester, Hertfordshire, Humberside, Isle of Wight, Kent, Lancashire, Leicestershire, Lincolnshire, London, Merseyside, Norfolk, Northamptonshire, Northumberland, Nottinghamshire, Oxfordshire, Shropshire (Salop), Somerset, Staffordshire, Suffolk, Surrey, East Sussex, West Sussex, Tyne and Wear, Warwickshire, Wiltshire, North Yorkshire.

  Mr. Redmond
  To ask the Secretary of State for the Home Department (1) if he will list the annual spending on civil defence research and development over the past four years;

  (2) what plans he has for future expenditure on civil defence research and development.

  Mr. John Patten
  Home Office expenditure on civil defence research and development (including scientific staff costs) for the past four years was as follows:

  £ million

  1984–85

  0·560

  1985–86

  1·192

  1986–87

  1·028

  1987–88

  1·293

  The estimate for 1988–89 is £1·015 million; proposed expenditure for future years is about £1·3 million per annum.

  Mr. Redmond
  To ask the Secretary of State for the Home Department what are the numbers of members of staff employed for emergency planning in district authorities whose salary costs are funded either wholly or partly by Home Office civil defence grant.
  205
  Mr. John Patten
  The total numbers of grant-aided local authority staff employed for emergency planning in England and Wales at 30 September 1988 were 499 emergency planning officers and 147 administrative and support staff. The great majority of these staff have some involvement in emergency planning in district authorities. The numbers employed directly by district authorities are 35 emergency planning officers and 10 administrative and support staff.

  Mr. Redmond
  To ask the Secretary of State for the Home Department when the report of his Department's review of the United Kingdom warning and monitoring organisation will be published; and whether he has considered the case for a moratorium on capital expenditure by the United Kingdom warning and monitoring organisation until the review report is available for consideration.

  Mr. John Patten
  We expect to publish shortly an account of the main findings of the review. During the course of the review, new capital expenditure on warning and monitoring was limited to items essential to the maintenance of the organisation's effectiveness and readiness for operation. Future capital programmes will be considered in the light of the review, taking fully into account the results of consultation with interested parties on its findings.

  Mr. Redmond
  To ask the Secretary of State for the Home Department how many members of staff are employed by each county council and fire and civil defence authority(a) as emergency planning officers and (b) as emergency planning team administrative and support staff.

  Mr. John Patten
  The numbers of civil defence grant-aided staff employed in England and Wales at 30 September 1988 were as follows:

  Emergency planning officer

  Emergency planning team administrative and support staff

  Avon

  5

  2

  Bedfordshire

  4

  1

  Berkshire

  10

  2

  Buckinghamshire

  6

  2

  Cambridgeshire

  9

  2

  Cheshire

  13

  4

  Cleveland

  5

  2

  Clwyd

  10

  2

  Cornwall

  10

  2

  Cumbria

  8

  2

  Derbyshire

  6

  3

  Devon

  18

  8

  Dorset

  10

  2

  Durham

  8

  1

  Dyfed

  8

  2

  Essex

  8

  3

  Mid Glamorgan

  6

  2

  South Glamorgan

  5

  3

  West Glamorgan

  7

  3

  Gloucestershire

  9

  1

  Greater Manchester

  13

  3

  Gwent

  9

  2

  Gwynedd

  5

  2

  Hampshire

  9

  2

  Hereford and Worcester

  6

  2

  Hertfordshire

  7

  3

  Humberside

  8

  6

  Isle of Wight

  4

  —

  206

  Emergency planning officer

  Emergency planning team administrative and support staff

  Kent

  11

  3

  Lancashire

  6

  2

  Leicestershire

  6

  2

  Lincolnshire

  9

  2

  London

  34

  7

  Merseyside

  13

  5

  Norfolk

  4

  1

  Northamptonshire

  6

  4

  Northumberland

  8

  3

  Nottinghamshire

  9

  2

  Oxfordshire

  5

  1

  Powys

  5

  —

  Shropshire (Salop)

  7

  1

  Somerset

  8

  3

  Staffordshire

  7

  3

  Suffolk

  4

  1

  Surrey

  9

  4

  East Sussex

  6

  —

  West Sussex

  6

  1

  Tyne and Wear

  12

  3

  Warwickshire

  7

  3

  West Midlands

  14

  5

  Wiltshire

  9

  2

  North Yorkshire

  10

  4

  South Yorkshire

  12

  3

  West Yorkshire

  11

  3

  Total

  464

  137

  Adults (Arrests)
  Mr. Pendry
  To ask the Secretary of State for the Home Department what percentage of the adult population in England and Wales were arrested in 1987.

  Mr. John Patten
  This information is not available in the form requested. The latest available information relates to arrests of those aged 17 and over in England and Wales, excluding the Metropolitan police district, in 1987. There were 1·3 million such arrests among a population of the same age group of 33·5 million.

  VAT
  Mr. Heddle
  To ask the Secretary of State for the Home Department what assessments he has made as to the likely effect on(a) his Department's capital building programme and (b) the rent the Department will pay under occupational leases of implementation of the European Court of Justice's judgment on value added tax on non-domestic buildings.

  Mr. Hurd
  Implementation of the European Court of Justice's judgment on VAT will have no effect on my Department's capital building programme, since compensating adjustments have been made to the relevant expenditure provisions. At this stage, before landlords have decided whether to exercise their option to tax rents, it is not possible to offer meaningful estimates of the effects of the judgment on rental costs.

  Wild Birds
  Mr. Hinchliffe
  To ask the Secretary of State for the Home Department when he last consulted the Royal Society for the Protection of Birds over the use of its
  207
  database to identify prosecution cases including the killing, sale and smuggling of British birds of prey and other wild birds; and if he will make a statement.

  Mr. Douglas Hogg
  The Royal Society for the Protection of Birds wrote to the Home Office in July 1988 to seek assistance with the maintenance of its database. We consulted the Association of Chief Police Officers about this request. We understand from ACPO that the police service only rarely consults the RSPB database and we have informed the RSPB that in those circumstances Home Office assistance could not be justified.

  Lindholme Prison (Disturbances)
  Mr. Harry Greenway
  To ask the Secretary of State for the Home Department what inquiries will be undertaken into the disturbances in Her Majesty's prison Lindholme in July by(a) Her Majesty's chief inspector of prisons and (b) the prison's board of visitors; and when reports will be produced.

  Mr. Douglas Hogg
  A full inquiry into the incident was conducted by the deputy director general of the prison service in July and a copy of his report is in the Library. Her Majesty's chief inspector of prisons has not been invited to make any new inquiry, and I understand that Her Majesty's prison Lindholme board of visitors has no plans to do so.

  POA (Deduction of Subscriptions)
  Mr. Beith
  To ask the Secretary of State for the Home Department why he has withdrawn the facility for allowing the voluntary deduction of Prison Officers Association subscriptions from members' pay.

  Mr. Douglas Hogg
  The facility was suspended because the association, after due warning, has failed to take genuine steps to draw up and agree with prison service management a firm programme for ending national industrial action which has been taking place since 13 January 1988.

  Women Police Surgeons (South Yorkshire)
  Mr. Redmond
  To ask the Secretary of State for the Home Department what is the establishment requirement for women police surgeons in the South Yorkshire police force; and how many are in post.

  Mr. Douglas Hogg
  Police surgeons are appointed by police authorities, which determine their own establishment requirements. No central record is maintained.

  Passports (Cabinet)
  Mr. Redmond
  To ask the Secretary of State for the Home Department which members of the Cabinet have been issued with the new common format passport.

  Mr. Renton
  United Kingdom passports in the European Community common format are at present held by the Home Secretary and the Foreign and Commonwealth Secretary.

  Asylum (Singhalese and Tamils)
  Mr. Cohen
  To ask the Secretary of State for the Home Department if he will take steps to review the current level 208
  of political and inter-racial violence in Sri Lanka with regard to the application of criteria for granting of asylum to Singhalese and Tamils; and if he will make a statement.

  Mr. Renton
  The situation in Sri Lanka is kept under constant review. Applications for asylum from Sri Lankans, as for all nationalities, are considered on an individual basis and refugee status is granted to those who meet the criteria established by the 1951 convention. The Government remain of the view, however, that membership of any particular ethnic group in Sri Lanka does not of itself provide the basis of a claim to refugee status under the convention. Asylum applicants who fail to meet the requirements of the convention are liable to be returned to Sri Lanka. Exceptional leave to enter, or remain, in the United Kingdom may be considered taking into account all the individual circumstances of a case, including in particular an applicant's personal acceptability, the length of time he has been in the United Kingdom and any compassionate factors.

  Driving While Disqualified
  Mr. Hunter
  To ask the Secretary of State for the Home Department how many convictions there were in England and Wales in 1987 for the offence of driving while disqualified; and what assessment he has made of the actual incidence of driving whilst disqualified which remains undetected.

  Mr. John Patten
  The number of findings of guilt for driving while disqualified is published annually in Home Office statistical bulletins, "Offences, relating to motor vehicles, England and Wales" (table 9 of issue 32/88 gives figures up to 1987). Further information is given in a companion volume of supplementary tables; the issue for 1987 will be published soon.

  Information on the level of undetected offences of driving while disqualified is not available.

  Vietnamese Refugees
  Mr. Foulkes
  To ask the Secretary of State for the Home Department if he will give a breakdown of Vietnamese refugees from Hong Kong admitted to the United Kingdom by each year, for the last 10 years.

  Mr. Renton
  The total numbers of south-east Asian refugees accepted for settlement in the United Kingdom in the years 1978 to 1987 and in the first half of 1988 are published in table 18 of "Control of Immigration: Statistics United Kingdom 1987" (Cm. 415) and in table 3 of Home Office statistical bulletin "Control of Immigration; Statistics—Second Quarter 1988" (Issue 27/88). Separate figures are not available for the number of these refugees who have come from Hong Kong.

  Prisoners (Repatriation)
  Mr. Bowis
  To ask the Secretary of State for the Home Department if he will list the countries with which the United Kingdom has a reciprocal arrangement for the repatriation of prisoners to serve their sentences in their home countries.

  Mr. John Patten
  Austria, Canada, Cyprus, Denmark, Finland, France, Greece, Luxembourg, the Netherlands, Spain, Sweden, Switzerland, Turkey, the United States of
  209
  America; and the following overseas territories: Anguilla, British Indian Ocean Territory, British Virgin Islands, Cayman Islands, Falkland Islands, Gibraltar, Hong Kong, Montserrat, Pitcairn, Henderson, Ducie and Oeno Islands, St. Helena, St. Helena Dependencies, and the Sovereign Base Areas of Akrotiri and Dhekelia in the Island of Cyprus.

  Broadcasting
  Mr. Fisher
  To ask the Secretary of State for the Home Department, further to his White Paper, "Broadcasting in the 1990s," whether he will specify the criteria which will be used in assessing the diversity of programming.

  Mr. Renton
  The positive programming requirements will be spelt out in general terms in legislation, and it would be for the new Independent Television Commission to decide precisely how to apply them in practice.

  Mr. Fisher
  To ask the Secretary of State for the Home Department how many items of news reporting and current affairs which were broadcast on(a) BBC 1, (b) BBC 2, (e) ITV, (d) Channel 4, (e) independent local radio, (f) BBC Radio 1, 2, 3 or 4 and (g) BBC local radio have been affected by the order on restrictions on reporting from Northern Ireland.

  Mr. Tim Renton
  My right hon. Friend has given general directions to the BBC and the IBA requiring them to refrain from broadcasting direct statements by Northern Ireland terrorist organisations and their apologists. It is now for the BBC and the IBA to apply those directions. They are not, of course, required to make returns to my right hon. Friend about the effect of the directions. In any case, the directions do not prevent the second-hand reporting of events, only the coverage of direct broadcast statements.

  Extradition
  Mr. Nicholas Bennett
  To ask the Secretary of State for the Home Department how many extradition requests have been received from the Republic of Ireland in each year since 1968 for(a) terrorist and terrorist-related offences and (b) other offences; and how many in each category have been refused in each year.

  Mr. John Patten
  The readily available information for extradition requests from the Republic of Ireland to England and Wales is given in the table. It is based on statistics provided by police forces.

  Requests received

  Requests refused

  1982

  9

  —

  1983

  15

  —

  1984

  31

  —

  1985

  29

  —

  1986

  15

  3

  1987

  20

  —

  1988

  1

  1

  1 Not yet available.

  Mr. Nicholas Bennett
  To ask the Secretary of State for the Home Department how many extradition requests have been received from Belgium in each year since 1968 for(a) terrorist and terrorist-related offences and (b) other offences; and how many in each category have been refused in each year.
  210
  Mr. John Patten
  Since January 1968 the Belgian Government have made extradition requests to the United Kingdom in respect of 50 persons. Of these 26 were charged in connection with the Heysel stadium riot. No requests were for terrorist or terrorist-related offences. Requests relating to other offences were made in the following years:

  Numbers of requested persons

  Refused

  1968

  3

  3

  1971

  1

  1

  1972

  1

  1

  1973

  2

  1

  1975

  1

  —

  1977

  2

  —

  1979

  1

  —

  1980

  2

  —

  1981

  4

  1

  1983

  2

  1

  1984

  1

  —

  1985

  1

  1

  1986

  28

  2

  1987

  1

  —

  50

  11

  Mr. Nicholas Bennett
  To ask the Secretary of State for the Home Department what was the total number of extraditions requested in each year since 1968 from Belgium for(a) terrorist and terrorist-related offences and (b) other offences; and how many requests in each category were refused in each year.

  Mr. John Patten
  Since January 1986 the Government have made extradition requests for 14 persons to be returned from Belgium. Only one request, made in 1988, was for terrorist or terrorist-related offences and this was refused. Requests relating to other offences were made in the following years:

  Number of requested persons

  Refused

  1969

  2

  —

  1971

  1

  —

  1972

  3

  1

  1978

  1

  —

  1981

  1

  —

  1983

  1

  —

  1985

  2

  —

  1986

  2

  —

  13

  1

  Mr. Nicholas Bennett
  To ask the Secretary of State for the Home Department what was the total number of extraditions requested in each year since 1968 from the Republic of Ireland for(a) terrorist and terrorist-related offences and (b) other offences; and how many requests in each category were refused in each year.

  Mr. John Patten
  The readily available information for extradition requests from England and Wales to the Republic of Ireland is given in the table. This is based mainly on information provided by police forces. Requests involving terrorist offences are specified where known.
  211

  Requests made

  Requests refused

  1982

  41

  1

  1983

  31

  —

  1984

  29

  —

  1985

  23

  —

  1986

  112

  11

  1987

  5

  2

  1988

  27

  —

  1 includes 1 case involving terrorist offences

  2 includes 2 cases involving terrorist offences

SCOTLAND

  Public Bodies
  Mr. Home Robertson
  To ask the Secretary of State for Scotland if he will make a statement on his policy on ministerial appointments to public bodies; if he will publish an up-to-date list of the quangos to which he nominates members, showing the level of public funding for each body and listing the individual members appointed by himself and showing any renumeration that they receive in connection with such membership; and if he will indicate any political allegiance that has been drawn to his attention in the nomination of candidates for such positions.

  Mr. Rifkind
  In making appointments to public bodies, I seek to draw from all sections of the community candidates who will be able to make a significant personal contribution to the body to which they are appointed. In all cases I expect to appoint the best person available.

  The list of non-departmental bodies to which I make appointments is contained in the Cabinet Office publication "Public Bodies", a copy of which is available in the Library. A new edition is to be published shortly. The list includes information about the public funding of each body and the remuneration paid to members. No consistent record is kept of the political affiliation of persons nominated for or appointed to public office.

  The list of individuals appointed is too long for publication in Hansard. I will write to the hon. Member with the information requested and place a copy of my letter in the Library.

  Greater Glasgow Health Board
  Mr. Galbraith
  To ask the Secretary of State for Scotland why officials of the Greater Glasgow health board came to London to meet the Scottish representatives of the Royal College of Nursing and Royal College of Midwives; what was the cost to public funds; and if he will make a statements.

  Mr. Michael Forsyth
  These are matters for the health board, and I am asking the chairman to write to the hon. Gentleman.

  Mr. Galbraith
  To ask the Secretary of State for Scotland pursuant to his answer of 30 November, if he will instruct Greater Glasgow health board, under section 2 of the Health Services (Scotland) Act 1974, to provide him with the information requested in order that it can be made available to Parliament.
  212
  Mr. Michael Forsyth
  There is no such Act. I understand that the information that the hon. Gentleman is seeking was made public by the health board through a press release on 28 November.

  Water Research Council
  Mr. Allan Stewart
  To ask the Secretary of State for Scotland (1) what will be the effects on the work in Scotland of the Water Research Council of the privatisation of the water industry in England and Wales;

  (2) what representations he has received concerning the future role of the Water Research Council in Scotland; and if he will make a statement.

  Lord James Douglas-Hamilton
  The organisation and work of the Water Research Centre is determined by its members, among them the Scottish water authorities and river purification boards. Arrangements are being made for the WRC to continue to serve the water industry, Government and other customers and for its work in Scotland to be maintained. No representations on the future role of WRC in Scotland have been received.

  Health Service (Grading)
  Mr. Corbyn
  To ask the Secretary of State for Scotland if he will publish a breakdown of the new grading structure for nurses, midwives and health visitors broken down by grade, type of hospital including psychiatric, geriatric and acute, by district and region.

  Mr. Michael Forsyth
  This information is not held centrally and could be gathered only at disproportionate cost. I would, however, refer the hon. Member to the answer I gave to my hon. Friend the Member for Tayside, North (Mr. Walker) on Thursday 1 December 1988, at column 342.

  Mr. Corbyn
  To ask the Secretary of State for Scotland if he will indicate the date on which he first received grading projections from each health board on the new clinical structure for nurses, midwives and health visitors.

  Mr. Michael Forsyth
  Health boards' interim returns were received in the latter part of August and in September.

  Domestic Assaults
  Mrs. Ray Michie
  To ask the Secretary of State for Scotland if he will instruct police forces to produce separate figures on the number of reported domestic assaults each year; and if he will make a statement.

  Lord James Douglas-Hamilton
  This matter is currently under consideration in consultation with the Association of Chief Police Officers (Scotland).

  Schools
  Mr. Allan Stewart
  To ask the Secretary of State for Scotland whether he will publish details of his proposals for allowing parents to take schools out of local authority control.

  Mr. Michael Forsyth
  A paper is being issued today entitled "Self-Governing Schools—Extending Choice for Scottish Parents" describing proposals expected to provide
  213
  the basis for forthcoming legislation. It is being made available to education authorities representative bodies. school councils, parent-teacher associations and the general public. Copies have been placed in the Library.

  These proposals represent another major step towards greater choice in education. Opting for local self-management in place of central control by the education authority will create a new form of school. The school will remain in the public sector but will enjoy freedom to develop its own ethos under local management and to tailor provision to the needs of its pupils and the expectations of the local community.

  The decision whether to seek self-governing status will be entirely for the parents at each individual school: there will be no pressure or obligation on any school to take this route against the wishes of parents. The paper we have now issued to education authorities and others provides fuller details of what would be involved. The main features are:
  A self-governing school will remain part of the mainstream of education provision, publicly funded, open to all without qualifying examination or fees.
  Self-governing schools will be subject to inspection to ensure that they provide a satisfactory standard of education.
  The school will be managed, and its staff employed, by a board of management consisting of parents, staff and representatives of the wider community.
  Funding will be by direct Government grant, set to match the resources which the school could reasonably have expected to receive if it had stayed under the management of the education authority.

EMPLOYMENT

  Skill Training
  Mr. Blunkett
  To ask the Secretary of State for Employment by what means he ensures that the needs of industry for a properly trained work force are met.

  Mr. Cope
  I refer the hon. Member to the White Paper "Employment in the 1990s" and the statement by my right hon. Friend the Secretary of State of 5 December 1988.

  Skills Shortages
  Mr. Andrew Smith
  To ask the Secretary of State for Employment what measures his Department is taking to counteract the skills shortage in the south-east.

  Mr. Cope
  I refer the hon. Member to the chapter on training in White Paper "Employment in the 1990s" published by my right hon. Friend the Secretary of State on Monday 5 December.

  Tourism
  Mr. Robert G. Hughes
  To ask the Secretary of State for Employment if he plans to meet the chairman of the English Tourist Board to discuss the expansion of the tourist industry; and if he will make a statement.

  Mr. Lee
  My right hon. Friend has no plans for a meeting with the chairman of the English Tourist Board on this Subject.

  Employment Training (Liverpool)
  Mr. Bary Field
  To ask the Secretary of State for Employment if he will make a statement on Liverpool city council's participation in the employment training scheme.
  214
  Mr. Nicholls
  Liverpool city council is not taking part in employment training. Indeed, the council decided to punish local voluntary organisations and employers which did want to participate and the High Court has now ruled that this action is unlawful. Unlike Liverpool city council, the Government will continue to provide help through the quality training opportunities offered through employment training.

  School Leavers
  Mr. McCrindle
  To ask the Secretary of State for Employment if he will estimate the numbers of young people leaving school and being available for work in each of the next five years; and if he will make a statement.

  Mr. Cope
  The most recent projected numbers of school leavers in Great Britain available for employment for academic years from 1988–89 to 1992–93 are as follows:

  Projected number of school leavers in Great Britain available for employment1

  Academic year ending 31 August

  Thousands

  1988–89

  520

  1989–90

  490

  1990–91

  460

  1991–92

  440

  1992–93

  420

  1 Rounded to the nearest 10,000.

  Careers Service (Funding)
  Mr. Cummings
  To ask the Secretary of State for Employment what is the proposed allocation for the revised careers service strengthening scheme for 1989–90 and for 1988–89 for all local education authorities based on the current method of funding for specific posts.

  Mr. Cope
  The available information is given in the table below. For 1989–90 under the revised scheme, the figures are of provisional cash allocations; 1988–89 figures show the number of posts allocated. Grants to LEAs in 1988–89 depends on the number of posts allocated, the extent to which those posts are filled, the salary level of careers officers filling the posts and the level of grants payable for posts under the scheme. Estimates of the actual cash grants which will be paid to each individual authority as a result of these factors are not made. Allocations in 1989–90 are designed to provide a contribution to all careers service costs and are not related to numbers of posts.

  Local education authority

  Allocated posts 1988–89

  Cash allocations 1989–90

  ILEA

  52·0

  920,000

  Barking

  2·5

  43,000

  Barnet

  3·0

  42,000

  Bexley

  3·0

  41,000

  Brent

  4·0

  78,000

  Bromley

  3·5

  49,000

  Croydon

  4·0

  70,000

  Ealing

  5·0

  63,000

  Enfield

  4·0

  50,000

  Haringey

  5·0

  92,000

  Harrow

  1·0

  22,000

  Havering

  2·5

  37,000

  Hillington

  2·0

  29,000

  215

  Local education authority

  Allocated posts 1988–89

  Cash allocations 1989–90

  Hounslow

  2·0

  38,000

  Kingston

  1·0

  13,000

  Merton

  0·5

  26,000

  Newham

  8·0

  122,000

  Redbridge

  2·5

  47,000

  Richmond

  0·5

  13,000

  Sutton

  1·0

  19,000

  Waltham Forest

  5·0

  73,000

  Bedfordshire

  9·0

  123,000

  Berkshire

  9·0

  113,000

  Buckinghamshire

  6·0

  78,000

  Cambridgeshire

  9·0

  133,000

  East Sussex

  8·0

  122,000

  Essex

  21·0

  303,000

  Hampshire

  24·0

  358,000

  Hertfordshire

  11·0

  139,000

  Isle of Wight

  4·0

  50,000

  Kent

  26·0

  370,000

  Norfolk

  15·0

  218,000

  Oxfordshire

  8·0

  101,000

  Suffolk

  10·0

  126,000

  Surrey

  8·0

  101,000

  West Sussex

  5·0

  65,000

  Avon

  18·0

  227,000

  Cornwall

  11·5

  152,000

  Devon

  20·0

  290,000

  Dorset

  8·0

  108,000

  Gloucestershire

  10·0

  126,000

  Somerset

  9·0

  113,000

  Wiltshire

  10·5

  132,000

  Birmingham

  41·0

  667,000

  Coventry

  15·0

  196,000

  Derbyshire

  25·0

  384,000

  Dudley

  9·0

  133,000

  Hereford

  13·0

  185,000

  Leicestershire

  0·14

  217,000

  Lincolnshire

  14·0

  178,000

  Northamptonshire

  10·0

  126,000

  Nottinghamshire

  29·0

  446,000

  Sandwell

  13·0

  190,000

  Shropshire

  12·0

  151,000

  Solihull

  5·0

  82,000

  Staffordshire

  26·0

  383,000

  Walsall

  9·0

  141,000

  Warwickshire

  11·0

  139,000

  Wolverhampton

  14·0

  188,000

  Barnsley

  11·0

  172,000

  Bradford

  16·0

  234,000

  Calderdale

  5·5

  69,000

  Doncaster

  15·0

  192,000

  Humberside

  34·5

  440,000

  Kirklees

  11·0

  160,000

  Leeds

  22·0

  330,000

  North Yorkshire

  12·0

  178,000

  Rotherham

  11·0

  160,000

  Sheffield

  23·0

  402,000

  Wakefield

  10·0

  168,000

  Bolton

  8·0

  126,000

  Bury

  6·0

  75,000

  Cheshire

  26·0

  386,000

  Cumbria

  13·0

  169,000

  Knowsley

  17·0

  214,000

  Lancashire

  33·0

  494,000

  Liverpool

  37·0

  467,000

  Manchester

  18·0

  317,000

  Oldham

  6·0

  90,000

  Rochdale

  6·0

  94,000

  Salford

  9·0

  138,000

  Sefton

  13·0

  164,000

  St. Helens

  10·0

  126,000

  Stockport

  6·0

  88,000

  Tameside

  6·0

  91,000

  Trafford

  6·0

  75,000

  Wigan

  12·0

  187,000

  Wirral

  13·0

  182,000

  Cleveland

  30·0

  379,000

  216

  Local education authority

  Allocated posts 1998–89

  Cash allocations 1989–90

  Durham

  25·0

  315,000

  Northumberland

  11·0

  139,000

  Gateshead

  11·0

  139,000

  Newcastle

  16·0

  202,000

  North Tyne

  10·0

  126,000

  South Tyne

  12·0

  151,000

  Sunderland

  17·0

  219,000

  Job Vacancies
  Mr. Bradley
  To ask the Secretary of State for employment if he will publish an analysis of known job vacancies in Greater Manchester by skill category required.

  Mr. Lee
  the following information is in the Library. The table shows the number of unfilled vacancies analysed by occupation at jobcentres in the Greater Manchester county on 7 October 1988.

  Recent research has confirmed that, nationally, about a third of vacancies are notified to jobcentres.

  Job vacancies analysed by occupation in Greater Manchester as at 7 October 1988

  Occupation description

  Vacancies

  Managerial

  478

  Nursing

  139

  Typing and Secretarial

  245

  Clerical and Machine operators

  1,648

  Selling—Distribution

  1,159

  Selling—others

  493

  Security and Protective services

  244

  Catering

  1,367

  Cleaning and personal services

  1,158

  Farming and Fishing

  29

  Materials Processing—Textiles/Cloth

  14

  Materials Processing—Food

  121

  Metal Processing

  13

  Metal Processing—Others

  14

  Making/ Repairing/Textiles/Cloths

  522

  Making/Repairing—Others

  273

  Machine operator (Engineering)—Skilled

  120

  Machine operator (Engineering)—Unskilled

  19

  Toolmakers/Fitters

  44

  Installation/Maintenance

  230

  Electricians

  166

  Electronic Technicians

  36

  Welding/Fabrication

  231

  Painting

  80

  Assembling/Packaging/Inspecting

  306

  Construction—Skilled

  211

  Construction—Unskilled

  34

  Mining and Quarrying

  2

  Transport Operators—HGV and PSV

  173

  Transport Operators—Others

  509

  Miscellaneous

  380

  Total

  10,504

  Mr. Bradley
  To ask the Secretary of State for Employment if he will list the number of vacancies which exist by industrial classification in each of the constituencies in Greater Manchester; and if he will list other vacancies according to whatever similar criteria his Department uses for the same area.

  Mr. Lee
  The table gives the available information which is also in the Library. It shows the number of unfilled vacancies analysed by industry at jobcentres in the county of Greater Manchester on 5 August 1988, the latest
  217
  available date. Vacancy statistics are collected by jobcentre area, and it is not possible to allocate the figures accurately by parliamentary constituency for Greater Manchester.

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Altrincham jobcentre

  Ashton-under-Lyne jobcentre

  Atherton jobcentre

  Agriculture, forestry and fishing

  3

  0

  8

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  4

  0

  0

  Extraction of other minerals and ores

  0

  0

  0

  Metal manufacture

  0

  0

  0

  Manufacture of non-metallic products

  0

  1

  0

  Chemical industry

  0

  3

  0

  Production of man-made fibres

  0

  0

  0

  Manufacture: of metal goods

  4

  12

  1

  Mechanical engineering

  15

  16

  4

  Manufacture: office machinery/D.P. equipment

  1

  0

  0

  Electrical and electronic engineering

  8

  5

  2

  Manufacture of motor vehicles

  1

  0

  2

  Shipbuilding and repairing

  0

  0

  0

  Manufacture: aerospace/transport equipment

  0

  0

  0

  Instrument engineering

  0

  0

  0

  Food, drink and tobacco

  1

  3

  3

  Textiles

  1

  8

  4

  Leather, footware and clothing

  1

  16

  12

  Timber and furniture

  3

  3

  10

  Paper, printing and publishing

  5

  2

  0

  Other manufacturing

  6

  2

  4

  Construction

  25

  14

  8

  Wholesale and distribution

  9

  7

  1

  Retail distribution

  101

  32

  5

  Hotels and catering

  80

  24

  3

  Repair of consumer foods and vehicles

  4

  1

  1

  Transport

  13

  11

  14

  Telecommunications

  2

  1

  1

  Insurance, banking etc., business services

  49

  25

  8

  Public administration and defence

  19

  33

  5

  Medical and other health services

  14

  88

  3

  Other services—NES

  38

  11

  7

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  407

  318

  106

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Beswick jobcentre

  Bolton jobcentre

  Bury jobcentre

  Agriculture, forestry and fishing

  0

  0

  1

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  0

  7

  0

  Extraction of other minerals and ores

  0

  0

  0

  Metal manufacture

  0

  0

  2

  Manufacture of non-metallic products

  0

  1

  5

  Chemical industry

  7

  2

  9

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  5

  10

  5

  Mechanical engineering

  16

  40

  8

  Manufacture: office machinery/D.P. equipment

  2

  0

  0

  Electrical and electronic engineering

  1

  4

  3

  Manufacture of motor vehicles

  4

  1

  1

  Shipbuilding and repairing

  0

  0

  0

  Manufacture: aerospace/transport equipment

  0

  0

  0

  Instrument engineering

  0

  1

  0

  Food, drink and tobacco

  3

  1

  2

  Textiles

  0

  23

  10

  Leather, footware and clothing

  4

  41

  17

  Timber and furniture

  2

  7

  8

  Paper, printing and publishing

  2

  7

  8

  Other manufacturing

  0

  17

  13

  Construction

  6

  38

  28

  Wholesale and distribution

  18

  21

  14

  218
  Recent reaserarch has confirmed that, nationally, about a third of vacancies are notified to jobcentres.
  219

  Industrial classification

  Beswick jobcentre

  Bolton jobcentre

  Bury jobcentre

  Retail distribution

  15

  119

  28

  Hotels and catering

  16

  62

  18

  Repair of consumer foods and vehicles

  1

  11

  5

  Transport

  7

  11

  14

  Telecommunications

  2

  1

  0

  Insurance, banking etc., business services

  5

  60

  15

  Public administration and defence

  13

  78

  29

  Medical and other health services

  1

  20

  13

  Other services—NES

  5

  37

  31

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  135

  620

  287

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Denton jobcentre

  Didsury jobcentre

  Droylsden jobcentre

  Agriculture, forestry and fishing

  0

  0

  0

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  1

  0

  0

  Extraction of other minerals and ores

  0

  0

  0

  Metal manufacture

  0

  0

  0

  Manufacture of non-metallic products

  0

  0

  0

  Chemical industry

  0

  0

  0

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  0

  0

  2

  Mechanical engineering

  5

  0

  0

  Manufacture: office machinery/D.P. equipment

  0

  0

  0

  Electrical and electronic engineering

  5

  3

  1

  Manufacture of motor vehicles

  1

  0

  0

  Shipbuilding and repairing

  2

  0

  0

  Manufacture: aerospace/transport equipment

  0

  0

  0

  Instrument engineering

  0

  0

  0

  Food, drink and tobacco

  0

  6

  1

  Textiles

  0

  0

  1

  Leather, footware and clothing

  8

  0

  0

  Timber and furniture

  3

  1

  2

  Paper, printing and publishing

  1

  2

  0

  Other manufacturing

  1

  2

  3

  Construction

  3

  8

  1

  Wholesale and distribution

  1

  1

  1

  Retail distribution

  10

  32

  3

  Hotels and catering

  7

  35

  12

  Repair of consumer goods and vehicles

  0

  2

  0

  Transport

  5

  1

  1

  Telecommunications

  1

  5

  0

  Insurance, banking etc., business services

  9

  24

  2

  Public administration and defence

  2

  16

  2

  Medical and other health services

  0

  20

  0

  Other services—NES

  7

  32

  2

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  72

  190

  34

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Eccles jobcentre

  Failsworth jobcentre

  Farnworth jobcentre

  Agriculture, forestry and fishing

  0

  0

  0

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  0

  0

  0

  Extraction of other minerals and ores

  0

  0

  0

  Metal manufacture

  0

  0

  1

  Manufacture of non-metallic products

  0

  0

  0

  Chemical industry

  0

  1

  0

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  1

  4

  0

  Mechanical engineering

  3

  1

  5

  Manufacture: office machinery/DP equipment

  2

  0

  0

  Electrical and electronic engineering

  0

  4

  5

  220 221

  Industrial classification

  Eccles jobcentre

  Failsworth jobcentre

  Farnworth jobcentre

  Manufacture of motor vehicles

  1

  0

  4

  Shipbuilding and repairing

  0

  0

  0

  Manufacture: aerospace/transport equipment

  0

  0

  1

  Instrument engineering

  0

  1

  0

  Food, drink and tobacco

  1

  0

  1

  Textiles

  0

  0

  2

  Leather, footware and clothing

  5

  3

  19

  Timber and furniture

  4

  2

  6

  Paper, printing and publishing

  0

  2

  2

  Other manufacturing

  5

  4

  10

  Construction

  11

  16

  18

  Wholesale and distribution

  9

  3

  4

  Retail distribution

  23

  12

  26

  Hotels and catering

  23

  14

  12

  Repair of consumer goods and vehicles

  0

  0

  0

  Transport

  10

  2

  13

  Telecommunications

  0

  0

  1

  Insurance, banking etc., business services

  20

  9

  10

  Public administration and defence

  20

  3

  41

  Medical and other health services

  8

  0

  11

  Other services—NES

  6

  3

  12

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  152

  84

  204

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Heywood jobcentre

  Hindley jobcentre

  Horwich jobcentre

  Agriculture, forestry and fishing

  0

  0

  0

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  0

  0

  0

  Extraction of other minerals and ores

  0

  0

  1

  Metal manufacture

  0

  0

  0

  Manufacture of non-metallic products

  1

  0

  0

  Chemical industry

  1

  0

  0

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  0

  0

  3

  Mechanical engineering

  1

  0

  3

  Manufacture: office machinery/DP equipment

  0

  0

  0

  Electrical and electronic engineering

  3

  11

  1

  Manufacture of motor vehicles

  0

  0

  0

  Shipbuilding and repairing

  0

  1

  0

  Manufacture: aerospace/transport equipment

  0

  0

  0

  Instrument engineering

  0

  0

  0

  Food, drink and tobacco

  0

  1

  3

  Textiles

  7

  3

  2

  Leather, footware and clothing

  0

  3

  5

  Timber and furniture

  0

  2

  1

  Paper, printing and publishing

  0

  0

  4

  Other manufacturing

  2

  0

  0

  Construction

  5

  3

  4

  Wholesale and distribution

  10

  0

  2

  Retail distribution

  5

  3

  5

  Hotels and catering

  5

  11

  17

  Repair of consumer goods and vehicles

  1

  0

  0

  Transport

  8

  3

  0

  Telecommunications

  0

  0

  0

  Insurance, banking etc., business services

  17

  0

  4

  Public administration and defence

  4

  2

  6

  Medical and other health services

  1

  0

  3

  Other services—NES

  7

  10

  4

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  78

  53

  68

  222 223

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Hyde jobcentre

  Irlam jobcentre

  Leigh jobcentre

  Agriculture, forestry and fishing

  0

  1

  0

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  0

  0

  1

  Extraction of other minerals and ores

  1

  0

  0

  Metal manufacture

  0

  0

  0

  Manufacture of non-metallic products

  0

  0

  0

  Chemical industry

  2

  2

  0

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  5

  1

  0

  Mechanical engineering

  16

  8

  8

  Manufacture: office machinery/DP equipment

  0

  0

  0

  Electrical and electronic engineering

  4

  1

  4

  Manufacture of motor vehicles

  0

  0

  1

  Shipbuilding and repairing

  0

  0

  0

  Manufacture: aerospace/transport equipment

  1

  0

  0

  Instrument engineering

  0

  0

  0

  Food, drink and tobacco

  6

  1

  3

  Textiles

  5

  0

  1

  Leather, footware and clothing

  7

  1

  7

  Timber and furniture

  2

  3

  1

  Paper, printing and publishing

  6

  0

  7

  Other manufacturing

  0

  0

  4

  Construction

  12

  8

  31

  Wholesale and distribution

  3

  2

  2

  Retail distribution

  11

  2

  17

  Hotels and catering

  11

  2

  19

  Repair of consumer goods and vehicles

  4

  1

  2

  Transport

  4

  4

  33

  Telecommunications

  0

  0

  0

  Insurance, banking etc., business services

  8

  9

  11

  Public administration and defence

  1

  4

  12

  Medical and other health services

  4

  1

  10

  Other services—NES

  4

  0

  13

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  117

  51

  187

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Levenshulme jobcentre

  Manchester jobcentre

  Marple jobcentre

  Agriculture, forestry and fishing

  0

  0

  0

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  1

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  8

  5

  0

  Extraction of other minerals and ores

  0

  0

  0

  Metal manufacture

  0

  1

  0

  Manufacture of non-metallic products

  0

  0

  0

  Chemical industry

  0

  0

  0

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  0

  9

  2

  Mechanical engineering

  10

  14

  1

  Manufacture: office machinery/DP equipment

  1

  2

  0

  Electrical and electronic engineering

  0

  11

  1

  Manufacture of motor vehicles

  0

  1

  2

  Shipbuilding and repairing

  0

  1

  0

  Manufacture: aerospace/transport equipment

  0

  0

  0

  Instrument engineering

  0

  1

  0

  Food, drink and tobacco

  7

  5

  0

  Textiles

  6

  43

  2

  Leather, footware and clothing

  17

  78

  7

  Timber and furniture

  2

  8

  0

  Paper, printing and publishing

  1

  16

  0

  Other manufacturing

  3

  7

  0

  Construction

  2

  32

  5

  Wholesale and distribution

  2

  100

  0

  Retail distribution

  40

  269

  5

  Hotels and catering

  12

  237

  7

  Repair of consumer goods and vehicles

  1

  15

  1

  Transport

  13

  31

  5

  224 225

  Industrial classification

  Levenshulme jobcentre

  Manchester jobcentre

  Marple jobcentre

  Telecommunications

  1

  13

  0

  Insurance, banking etc., business services

  12

  209

  3

  Public administration and defence

  5

  129

  2

  Medical and other health services

  3

  21

  1

  Other services—NES

  32

  102

  22

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  178

  1,361

  66

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Middleton jobcentre

  Moss Side jobcentre

  Mossley jobcentre

  Agriculture, forestry and fishing

  0

  0

  0

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  0

  0

  0

  Extraction of other minerals and ores

  0

  0

  0

  Metal manufacture

  0

  2

  2

  Manufacture of non-metallic products

  1

  0

  0

  Chemical industry

  1

  5

  2

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  2

  0

  2

  Mechanical engineering

  3

  1

  8

  Manufacture: office machinery/D.P. equipment

  0

  0

  0

  Electrical and electronic engineering

  2

  0

  0

  Manufacture of motor vehicles

  0

  1

  0

  Shipbuilding and repairing

  0

  0

  0

  Manufacture: aerospace/transport equipment

  0

  5

  0

  Instrument engineering

  0

  0

  0

  Food, drink and tobacco

  5

  1

  0

  Textiles

  0

  0

  2

  Leather, footware and clothing

  11

  12

  1

  Timber and furniture

  0

  1

  0

  Paper, printing and publishing

  5

  1

  1

  Other manufacturing

  1

  0

  0

  Construction

  6

  11

  5

  Wholesale and distribution

  1

  8

  0

  Retail distribution

  15

  8

  3

  Hotels and catering

  5

  16

  0

  Repair of consumer goods and vehicles

  1

  9

  0

  Transport

  9

  5

  2

  Telecommunications

  1

  0

  0

  Insurance, banking etc., business services

  14

  24

  4

  Public administration and defence

  5

  27

  2

  Medical and other health services

  0

  7

  2

  Other services—NES

  3

  22

  5

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  91

  166

  41

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Newton Heath jobcentre

  Oldham and Chadderton jobcentre

  Prestwick jobcentre

  Agriculture, forestry and fishing

  0

  0

  0

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  0

  2

  0

  Extraction of other minerals and ores

  1

  0

  0

  Metal manufacture

  2

  0

  0

  Manufacture of non-metallic products

  3

  0

  0

  Chemical industry

  0

  6

  0

  Production of man-made fibres

  0

  0

  0

  manufacture of metal goods

  11

  11

  0

  Mechanical engineering

  8

  17

  0

  Manufacture: office machinery/DP equipment

  0

  6

  0

  Electrical and electronic engineering

  3

  15

  1

  Manufacture of motor vehicles

  1

  6

  0

  Shipbuildings and repairing

  0

  0

  0

  Manufacture: aerospace/transport equipment

  0

  0

  0

  226 227

  Industrial classification

  Newton Heath jobcentre

  Oldham and Chadderton jobcentre

  Prestwick jobcentre

  Instrument engineering

  0

  1

  0

  Food, drink and tobacco

  4

  33

  0

  Textiles

  6

  9

  0

  Leather, footware and clothing

  16

  19

  4

  Timber and furniture

  3

  14

  4

  Paper, printing and publishing

  1

  5

  1

  Other manufacturing

  0

  21

  2

  Construction

  5

  36

  8

  Wholesale and distribution

  9

  12

  13

  Retail distribution

  11

  59

  15

  Hotels and catering

  9

  44

  11

  Repair of consumer goods and vehicles

  3

  6

  0

  Transport

  4

  20

  2

  Telecommunications

  1

  1

  0

  Insurance, banking etc., business services

  7

  29

  11

  Public administration and defence

  3

  42

  7

  Medical and other health services

  46

  28

  6

  Other services—NES

  5

  41

  15

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  162

  483

  100

  Unfilleld vacancies analysed by industry—5 August 1988

  Industrial classification

  Radcliffe jobcentre

  Rochdale jobcentre

  Royton jobcentre

  Agriculture, forestry and fishing

  0

  0

  0

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  0

  0

  0

  Extraction of other minerals and ores

  0

  0

  0

  Metal manufacture

  0

  0

  0

  Manufacture of non-metallic products

  0

  2

  0

  Chemical industry

  0

  4

  0

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  1

  5

  5

  Mechanical engineering

  5

  18

  7

  Manufacture: office machinery/DP equipment

  0

  0

  0

  Electrical and electronic engineering

  7

  4

  4

  Manufacture of motor vehicles

  0

  1

  0

  Shipbuilding and repairing

  0

  0

  0

  Manufacture: aerospace/transport equipment

  0

  0

  0

  Instrument engineering

  0

  0

  0

  Food, drink and tobacco

  1

  3

  4

  Textiles

  1

  3

  4

  Leather, footware and clothing

  6

  8

  3

  Timber and furniture

  1

  7

  2

  Paper, printing and publishing

  2

  1

  1

  Other manufacturing

  3

  3

  0

  Construction

  9

  33

  7

  Wholesale and distribution

  2

  2

  9

  Retail distribution

  14

  45

  8

  Hotels and catering

  5

  26

  6

  Repair of consumer foods and vehicles

  1

  9

  0

  Transport

  1

  22

  2

  Telecommunications

  0

  17

  0

  Insurance, banking etc., business services

  6

  38

  3

  Public administration and defence

  0

  48

  5

  Medical and other health services

  2

  1

  1

  Other services—NES

  5

  14

  8

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  73

  334

  86

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Salford jobcentre

  Stalybridge jobcentre

  Stockport jobcentre

  Agriculture, forestry and fishing

  0

  0

  2

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  228 229

  Industrial classification

  Salford jobcentre

  Stalybridge jobcentre

  Stockport jobcentre

  Gas, electricity and water

  0

  1

  4

  Extraction of other minerals and ores

  0

  0

  0

  Metal manufacture

  1

  1

  0

  Manufacture of non-metallic products

  0

  4

  2

  Chemical industry

  1

  0

  16

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  2

  5

  10

  Mechanical engineering

  9

  4

  32

  Manufacture: office machinery/DP equipment

  4

  0

  10

  Electrical and electronic engineering

  7

  0

  27

  Manufacture of motor vehicles

  0

  0

  3

  Shipbuilding and repairing

  0

  0

  0

  Manufacture: aerospace/transport equipment

  0

  0

  3

  Instrument engineering

  1

  0

  2

  Food, drink and tobacco

  4

  0

  16

  Textiles

  0

  2

  11

  Leather, footware and clothing

  26

  3

  33

  Timber and furniture

  4

  0

  12

  Paper, printing and publishing

  0

  1

  17

  Other manufacturing

  5

  1

  17

  Construction

  26

  2

  68

  Wholesale and distribution

  18

  1

  27

  Retail distribution

  39

  6

  163

  Hotels and catering

  23

  8

  82

  Repair of consumer goods and vehicles

  5

  0

  19

  Transport

  5

  0

  38

  Telecommunications

  1

  0

  2

  Insurance, banking etc., business services

  31

  6

  116

  Public administration and defence

  16

  2

  70

  Medical and other health services

  11

  0

  38

  Other services—NES

  12

  4

  61

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  251

  51

  901

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Stretford jobcentre

  Swinton jobcentre

  Westhoughton jobcentre

  Agriculture, forestry and fishing

  1

  0

  1

  Coal extraction

  0

  0

  0

  Mineral oil and natural gas extraction

  0

  0

  0

  Mineral oil processing

  4

  0

  0

  Nuclear fuel production

  2

  0

  0

  Gas, electricity and water

  3

  0

  0

  Extraction of other minerals and ores

  0

  0

  0

  Metal manufacture

  2

  1

  0

  Manufacture of non-metallic products

  3

  0

  0

  Chemical industry

  8

  2

  2

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  17

  0

  2

  Mechanical engineering

  22

  3

  4

  Manufacture: office machinery/DP equipment

  1

  0

  0

  Electrical and electronic engineering

  10

  3

  0

  Manufacture of motor vehicles

  4

  0

  0

  Shipbuilding and repairing

  0

  0

  0

  Manufacture: aerospace/transport equipment

  5

  0

  2

  Instrument engineering

  3

  2

  1

  Food, drink and tobacco

  10

  0

  0

  Textiles

  2

  2

  0

  Leather, footware and clothing

  3

  0

  2

  Timber and furniture

  2

  0

  4

  Paper, printing and publishing

  1

  0

  0

  Other manufacturing

  4

  0

  1

  Construction

  40

  13

  12

  Wholesale and distribution

  34

  0

  1

  Retail distribution

  60

  13

  7

  Hotels and catering

  27

  16

  18

  Repair of consumer goods and vehicles

  11

  3

  2

  Transport

  21

  2

  0

  Telecommunications

  2

  2

  0

  Insurance, banking etc., business services

  43

  8

  1

  Public administration and defence

  80

  131

  4

  Medical and other health services

  15

  7

  0

  Other services—NES

  39

  5

  8

  Speculative placings/transfers/inputs

  0

  0

  0

  230 231

  Industrial classification

  Stretford jobcentre

  Swinton jobcentre

  Westhoughton jobcentre

  TOTALS

  479

  213

  72

  Unfilled vacancies analysed by industry—5 August 1988

  Industrial classification

  Wigan jobcentre

  Worsley jobcentre

  Wythenshawe jobcentre

  Agriculture, forestry and fishing

  0

  0

  0

  Coal extraction

  1

  0

  0

  Mineral oil and natrual gas extraction

  0

  0

  0

  Mineral oil processing

  0

  0

  0

  Nuclear fuel production

  0

  0

  0

  Gas, electricity and water

  0

  0

  0

  Extraction of other minerals and ores

  0

  0

  0

  Metal manufacture

  0

  0

  0

  Manufacture of non-metallic products

  4

  0

  0

  Chemical industry

  1

  6

  0

  Production of man-made fibres

  0

  0

  0

  Manufacture of metal goods

  5

  2

  0

  Mechanical engineering

  14

  22

  3

  Manufacture: office machinery/DP equipment

  0

  0

  0

  Electrical and electronic engineering

  6

  17

  12

  Manufacture of motor vehicles

  6

  2

  0

  Shipbuilding and repairing

  0

  3

  0

  Manufacture: aerospace/transport equipment

  2

  0

  0

  Instrument engineering

  1

  0

  0

  Food, drink and tobacco

  9

  0

  7

  Textiles

  2

  2

  0

  Leather, footware and clothing

  21

  9

  1

  Timber and furniture

  8

  4

  10

  Paper, printing and publishing

  5

  1

  0

  Other manufacturing

  6

  0

  1

  Construction

  35

  7

  4

  Wholesale and distribution

  3

  9

  3

  Retail distribution

  43

  13

  16

  Hotels and catering

  34

  13

  37

  Repair of consumer goods and vehicles

  6

  0

  0

  Transport

  16

  11

  41

  Telecommunications

  1

  1

  1

  Insurance, banking etc., business services

  49

  7

  14

  Public administration and defence

  30

  8

  30

  Medical and other health services

  14

  4

  13

  Other services—NES

  22

  8

  45

  Speculative placings/transfers/inputs

  0

  0

  0

  TOTALS

  346

  149

  243

  Coal Industry (Accidents)
  Mr. Illsley
  To ask the Secretary of State for Employment whether, in view of the accident rates of contractors to British Coal, he will take any measures to improve safety records of those companies through stricter enforcement of the relevant legislation.

  Mr. Nicholls
  The Health and Safety Executive (HSE) enforce the Health and Safety at Work Etc. Act 1974 and other legislation as it applies to contractors and their employees within mines. This Act and the Mines and Quarries Act 1954 also require British Coal and its managers to ensure the safety of contractors. British Coal has also recently taken action with its major contractors to improve safety standards and safety awareness.

  Children (Insurance Cover)
  Mr. Archer
  To ask the Secretary of State for Employment if he has any plans to seek to amend section 2 of the Employers Liability (Compulsory Insurance) Act 1969 so as to provide for compulsory insurance cover for children employed by their relatives; and if he will make a statement.
  232
  Mr. Nicholls
  My right hon. Friend has no plans to seek to amend section 2 of the Act.

  Mining Industry (Accidents)
  Mr. Illsley
  To ask the Secretary of State for Employment what is the rate of fatal and major injury accidents of(a) British Coal employees and (b) employees contracted to British Coal expressed as a ratio of accidents to total numbers employed in each category.

  Mr. Nicholls
  The information is not available in the form requested.

  Mr. Meacher
  To ask the Secretary of State for Employment what has been the rate of (i) deaths and (ii) serious accidents in the mining industry per 100,000 workers in each year since 1970.

  Mr. Nicholls
  The information requested is listed in the table:
  233

  Year

  Number employed (1,000's)

  Fatal rate per 100,000 employed

  Serious injury rate per 100,000 employed

  1970

  304·4

  29·9

  210·8

  1971

  297·7

  24·2

  215·8

  1972

  289·7

  22·1

  179·6

  1973

  270·1

  29·6

  204·8

  1974

  256·7

  18·7

  194·1

  1975

  259·2

  24·7

  226·2

  1976

  254·5

  19·7

  210·6

  1977

  252·6

  15·9

  198·8

  1978

  248·1

  25·4

  199·2

  1979

  243·5

  18·9

  194·6

  1980

  242·6

  17·3

  211·6

  19811

  232·4

  15·1

  351·3

  1982

  220·5

  17·3

  393·2

  1983

  206·3

  14·6

  400·0

  1984–853 4

  175·4

  12·6

  216·0

  1985–863 5

  154·6

  18·2

  464·3

  1986–872 3 5

  125·4

  12·0

  761·6

  1987–883 5

  104·4

  8·6

  702·9

  Source: Health and Safety Executive and British Coal.

  1 NADOR Regulations 1980—introduced 1 January 1981.

  2 RIDDOR Regulations 1985—introduced 1 April 1986.

  3 Average number employed during the year.

  4 Covers 15-month period January 1984-March 1985—not comparable with earlier calendar year data.

  5 Excludes licensed mines.

  Opencast Mining
  Mrs. Golding
  To ask the Secretary of State for Employment if any investigation has been made of health problems arising from the close proximity of people to opencast mining; and if he will make a statement.

  Mr. Nicholls
  I am not aware of any authoritative survey or investigation into links between opencast mining and illness in people living nearby. There is no firm evidence that such a study would be worthwhile. However the Health and Safety Executive will continue to monitor the position and will take account of any new evidence that may emerge.

  Labour Statistics
  Mr. Tony Lloyd
  To ask the Secretary of State for Employment if he will give details of the impact of changes in the method of calculating unemployment figures since 1979 on the figures for the Stretford constituency.

  Mr. Lee
  The information requested is not available for areas smaller than standard planning regions.

  Mr. Bradley
  To ask the Secretary of State for Employment if he will publish a table showing what information he has for Greater Manchester as to the average weekly wage for(a) full-time male employees, (b) part-time male employees, (c) full-time female employees and (d) part-time female employees in both cash terms and real terms based on 1987–88 prices, for each year since 1979.

  Mr. Lee
  The available figures of average gross weekly earnings of employees in Greater Manchester are given in the table.234

  Average gross weekly earnings—Greater Manchester metropolitan county (gross earnings of adult employees whose pay was not affected by absence)

  April (£ per week)

  Males1

  Females2

  Full time

  Full time

  Part time3

  Cash terms

  1979

  98·8

  60·7

  26·7

  1980

  120·0

  74·3

  33·5

  1981

  136·6

  88·2

  36·5

  1982

  147·1

  93·8

  39·4

  1983

  160·1

  101·7

  43·4

  1984

  171·5

  110·9

  45·9

  1985

  183·5

  119·6

  48·8

  1986

  198·6

  130·6

  52·0

  1987

  214·4

  140·6

  55·7

  1988

  231·4

  154·8

  NYA

  At April 1988

  prices4

  1979

  192·5

  118·3

  52·0

  1980

  192·1

  118·9

  53·6

  1981

  195·1

  126·0

  52·1

  1982

  192·1

  122·5

  51·4

  1983

  201·0

  127·7

  54·5

  1984

  204·7

  132·4

  54·8

  1985

  204·8

  133·5

  54·5

  1986

  215·1

  141·5

  56·3

  1987

  222·8

  146·1

  57·9

  1988

  231·4

  154·8

  NYA

  Notes:

  1 Aged 21 years and over.

  2 Aged 18 years and over.

  3 Figures from 1984 onwards estimated from those on adult rates.

  4 Cash figures revalued using April 1988 retail price index (all items).
  NYA denotes not yet available.
  Figures for part time males are not available.
  Source: New Earnings Survey.

  Mr. Allen
  To ask the Secretary of State for Employment if he will publish in the Official Report the unemployment figures for each quarter from 1971 onwards, calculated on the same basis as last week's figures and publish alongside them the figures released at each quarter by his Department.

  Mr. Lee
  The table shows the latest seasonally adjusted unemployment figures consistent with the current coverage, together with the seasonally adjusted unemployment figures as published at the time for the United Kingdom, quarterly from January 1971.

  United Kingdom

  Seasonally adjusted unemployment consistent with current coverage Total

  Seasonally adjusted unemployment as published at the time1 Total

  1971

  January

  538·2

  647·7

  April

  604·3

  718·7

  July

  670·2

  794·2

  October

  721·5

  852·6

  1972

  January

  760·1

  900·1

  April

  782·7

  911·9

  July

  718·3

  846·4

  October

  686·9

  814·8

  1973

  January

  609·4

  738·6

  April

  552·9

  647·7

  July

  512·1

  606·3

  October

  461·5

  538·8

  235

  Seasonally adjusted unemployment consistent with current coverage Total

  Seasonally adjusted unemployment as published at the time1 Total

  1974

  January

  473·8

  565·1

  April

  504·1

  573·0

  July

  517·4

  605·5

  October

  546·1

  636·8

  1975

  January

  594·6

  712·9

  April

  691·2

  798·3

  July

  825·4

  968·2

  October

  944·6

  1,088·7

  1976

  January

  1,032·5

  1,196·9

  April

  1,081·8

  1,251·5

  July

  1,103·6

  1,285·6

  October

  1,110·3

  1,305·9

  1977

  January

  1,123·6

  1,345·1

  April

  1,130·4

  1,322·6

  July

  1,180·4

  1,402·2

  October

  1,201·3

  1,433·4

  1978

  January

  1,180·8

  1,419·2

  April

  1,161·2

  1,387·1

  July

  1,147·7

  1,371·4

  October

  1,127·7

  1,359·6

  1979

  January

  1,102·3

  1,339·1

  April

  1,089·1

  1,327·4

  July

  1,066·1

  1,278·7

  October

  1,053·9

  1,282·0

  1980

  January

  1,073·8

  1,336·7

  April

  1,185·9

  1,458·1

  July

  1,342·6

  1,605·7

  October

  1,596·4

  1,892·6

  1981

  January

  1,861·1

  2,228·3

  April

  2,068·0

  2,452·3

  July

  2,226·8

  2,582·3

  October

  2,342·2

  2,728·9

  1982

  January

  2,425·8

  2,828·9

  April

  2,477·7

  2,850·3

  July

  2,553·4

  2,926·4

  October

  2,641·4

  3,059·5

  1983

  January

  2,718·0

  2,984·7

  April

  2,766·8

  3,021·2

  July

  2,810·2

  2,963·2

  October

  2,822·0

  2,941·2

  1984

  January

  2,853·4

  2,975·1

  April

  2,878·7

  3,012·3

  July

  2,917·3

  3,053·9

  October

  2,972·2

  3,101·2

  1985

  January

  3,000·6

  3,126·4

  April

  3,037·2

  3,177·2

  July

  3,033·3

  3,175·4

  October

  3,050·7

  3,174·8

  1986

  January

  3,081·3

  3,204·9

  April

  3,114·6

  3,201·8

  236

  Seasonally adjusted unemployment consistent with current coverage Total

  Seasonally adjusted unemployment as published at the time1 Total

  July

  3,133·2

  3,224·0

  October

  3,096·3

  3,167·6

  1987

  January

  3,051·3

  3,119·4

  April

  2,953·9

  3,020·1

  July

  2,812·6

  2,877·6

  October

  2,663·9

  2,714·9

  1988

  January

  2,519·4

  2,563·1

  April

  2,402·9

  2,455·0

  July

  2,267·3

  2,313·9

  October

  2,160·2

  2,160·2

  1 These are the figures first published at the time. They therefore do not allow for all the various changes in coverage. Nor do they take account of the later more accurate assessments of the seasonal variations.

  Tourism
  Mr. Butterfill
  To ask the Secretary of State for Employment what plans the Government have to increase employment in the tourism industry in(a) the United Kingdom and (b) the south; and if he will make a statement.

  Mr. Lee
  The Government will continue with the sound economic policies that have helped to establish an enterprise economy which is generating sustained growth. The Government's role in developing the tourism industry in England is being considered as part of the review announced by my right hon. Friend the Secretary of State on July 18.

  Mr. Butterfill
  To ask the Secretary of State for Employment what information he has on the total amount spent on tourism and leisure developments in the first six months of 1988; what are the figures compared with those for the previous six month period; and if he will make a statement.

  Mr. Lee
  The English tourist board's "Tourism Investment Report" shows that the total amount spent on projects with a value of £0·5 million or more which were completed in the period January to June 1988 was ·247 million. Investment in projects under construction during the periods January to June 1988 and July to December 1987 amounted to £1,737 million and £1,005 million respectively.

  VAT
  Mr. Heddle
  To ask the Secretary of State for Employment what assessments he has made as to the likely effect on(a) his Department's capital building programme and (b) the rent the Department will pay under occupational leases, of implementation of the European Court of Justice's judgment on value added tax on non-domestic buildings.

  Mr. Cope
  Implementation of the European Court of Justice's judgment on VAT will have no effect on my Department's capital building programme, since compensating adjustments have been made to the relevant expenditure provisions. At this stage, before landlords have decided whether to exercise their option to tax rents, it is not possible to offer meaningful estimates of the effects of the judgment on rental costs.

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

South Africa: Membership of IAEA
Lord Hatch of Lusby Lord Hatch of Lusby asked Her Majesty's Government:
What is their policy towards the continuation of South Africa's membership of the International Atomic Energy Agency.
The Minister of State, Foreign and Commonwealth Office (Lord Glenarthur): My Lords, we oppose moves to suspend South Africa from the rights and privileges of membership of the International Atomic Energy Agency.
Lord Hatch of Lusby: My Lords, is it not the case that, following the last meeting of the agency, the South African Foreign Minister boasted that South Africa now has the means of building atomic weapons? Is it not further the case that the South Africans have refused to sign the non-proliferation treaty? Does not their continued membership of the agency supply them with technological and scientific information which is valuable to them as regards the building of atomic weapons?
Lord Glenarthur: My Lords, yes, I am aware of the claim made by Mr. Botha. There is no firm evidence that South Africa has either conducted a nuclear test or that it possesses nuclear weapons. We welcomed President Botha's statement in September 1987 that South Africa was willing to begin negotiations on the possibility of acceding to the non-proliferation treaty. We have urged South Africa to accede to that treaty and place its nuclear facilities under the full scope of the IAEA safeguards.
Lord Cledwyn of Penrhos: My Lords, can the noble Lord say what South Africa's response has been to the pressure brought to bear by Her Majesty's Government? Is there a likelihood that South Africa will sign the nuclear non-proliferation treaty, as Her Majesty's Government have indicated that they believe South Africa should do? Does the noble Lord agree that it is an extremely serious matter? While not dissenting from the basic proposition in his initial Answer, I must ask whether he will agree that it is an extremely serious matter that South Africa refuses to do this.
Lord Glenarthur: My Lords, we hope that South Africa will sign and accede to the non-proliferation treaty. However, it is not the only country that does not accede.
Lord Cledwyn of Penrhos: My Lords, with respect, when the noble Lord says that, he implies that there
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is a large number of countries which have not signed. Is it not the case that there is only one other country apart from South Africa which has not signed the treaty?
Lord Glenarthur: My Lords, the fact is that South Africa has indicated that it may be willing to begin negotiations to that end. I cannot forecast whether or not the negotiations will be successful but we hope that South Africa will sign.
Lord Cledwyn of Penrhos: My Lords, the noble Lord has not answered my question again. Is it not the case that South Africa is only one of two countries which have not signed the nonproliferation treaty?
Lord Glenarthur: My Lords, I should have thought that one or two countries were one or two too many.
Lord Hatch of Lusby: My Lords, the Minister says that there is no firm evidence that South Africa has atomic weapons. Is he not aware that according to very widespread scientific evidence, including that at the highest level in the United States of America, the South Africans tested a nuclear weapon in 1979? Will the noble Lord answer the latter part of my first supplementary question? So long as South Africa remains a member of the agency, are not the South Africans being given technological and scientific information to assist them in building nuclear weapons?
Lord Glenarthur: My Lords, whatever the noble Lord says, there is no firm evidence about South Africa's possession of a nuclear weapon, despite the noble Lord's belief that he has such evidence. As regards the IAEA, we firmly believe in and support South Africa's membership of that agency. We do not imply by that our approval of the South African regime, nor do we believe that it gives rise to the kind of concerns which the noble Lord suggests.
Lord Hatch of Lusby: My Lords, it is not a question of my words; it is the studied research done at the highest scientific levels, including those of the Administration in the United States. That research has shown that it is at least extremely probable that the South Africans tested a nuclear weapon as long ago as 1979. Again I ask: is it not the case that the South Africans are being given important technological and scientific information to assist them to build nuclear weapons? If that is the case, why is the noble Lord saying on behalf of the Government that they approve of the continued membership? Why do they approve of it?
Lord Glenarthur: My Lords, the noble Lord used the words "extremely probable". That does not amount to firm evidence. I have said that there is no firm evidence that South Africa has nuclear weapons. As regards the application of IAEA safeguards in South Africa, the Koeberg nuclear power station is covered by the safeguards, as is Pelindaba nuclear research reactor, and any safeguarded fuel submitted for reprocessing. No agreement has yet been concluded with the agency on the application of

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safeguards to the Valindaba pilot and semicommercial uranium enrichment plants. But I stand by what I said earlier; we do not have the concerns which the noble Lord expresses.
Lord Orr-Ewing: My Lords, will the noble Lord the Leader of the House—
Noble Lords: Next Question.
Lord Orr-Ewing: My Lords, I am not speaking on this Question. I am sorry; I give way to the noble Lord.
Lord Zuckerman: My Lords, while not wishing to controvert the noble Lord, Lord Hatch of Lusby, I wish to add my support to the Minister's Answer. There was no incontrovertible evidence that tests had been carried out by South Africa. I was in close touch with the inquiries which were then being made. The answer was totally dubious. No one to this day knows what that one pulse was about. In saying that, I obviously cannot say whether or not South Africa has or has not got nuclear weapons.
Lord Glenarthur: My Lords, I am grateful to the noble Lord. He points to the difficulty of obtaining this evidence.
Lord Orr-Ewing: My Lords, will my noble friend remind the House how many supplementary questions are allowed for each Question? What sanctions are there against those Members of the House who totally disregard that generally agreed instruction?
Lord Glenarthur: My Lords, apparently there is an almost endless number of supplementaries.
Lord Elwyn-Jones: My Lords, the answer depends on the quality of the Ministerial Answer, does it not!
Lord Glenarthur: My Lords, that presupposes, of course, that those who ask the questions agree with the Answer that has been given. In this case, apparently, they do not.
Lord Nugent of Guildford: My Lords, it also depends on the quality of the questions.

Government Departments: Relocation
2.45 p.m.
Lord Dormand of Easington Lord Dormand of Easington asked Her Majesty's Government:
What progress is being made in relocating government departments in the regions.
The Parliamentary Under-Secretary of State, Department of Transport (Lord Brabazon of Tara): My Lords, the 1979 programme is nearing completion—5,560 posts have been dispersed, and planning is in hand for more. Over 6,000 further posts have been relocated from the South-East at departmental initiative.
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Departments are now observing Treasury guidelines to review their work locations, seeking sites offering operating advantages. Locations subject to the Government's regional policy and urban programme will be considered. Relocations require careful planning and sensitive implementation, which take time. Most major departments have substantial reviews in hand and Parliament will be kept informed of progress.
Lord Dormand of Easington: My Lords, if the Government really believe in decentralisation and in bringing jobs to the regions—the Government frequently repeat those criteria—presumably the Minister would agree that movement to the regions reduces costs considerably. Why do the Government not do more of this relocation? Does the Minister not agree that the transfer of the national savings certificates division, for example, to Durham has been a resounding success?
Lord Brabazon of Tara: My Lords, I think the noble Lord is right. There have been some very successful moves. Departments will continue to look for sites which offer easier labour markets, reductions in accommodation and other costs, and increased operational efficiency.
Lord Glenamara: My Lords, can the noble Lord say how many government posts have been transferred to Northumberland, Durham and Cumbria under this Government?
Lord Brabazon of Tara: My Lords, as regards the northern region, which I think includes those areas—if it does not, I do not have the relevant figures—a substantial number of Civil Service jobs are in that region. At 1st April 1988 there were 34,000 jobs in the region. In terms of civil servants per 1,000 of population, the northern region scores almost as high as the South-East, despite the latter including the national capital and the seat of government.
The noble Lord will be interested particularly in Newcastle, where the DHSS created 600 new posts last year. In Darlington, the Department of Education and Science is now transferring work which will create 30 new jobs.
The Earl of Lauderdale: My Lords, can my noble friend give similar figures for Scotland?
Lord Brabazon of Tara: My Lords. I cannot give figures for Scotland, but I know that certain departments have transferred substantial parts of their operation to Scotland, including the Overseas Development Agency. That was a successful move.
Baroness Seear: My Lords, the noble Lord gave us the overall figures of posts that have been transferred. Can he give us the percentage of the total strength of the Civil Service that has been transferred? The global figure does not tell us very much in terms of progress.
Lord Brabazon of Tara: My Lords, I understand that in total some 45 per cent. of the Civil Service is located outside the South of England.
Lord Cledwyn of Penrhos: My Lords, I am sure the noble Lord will have anticipated my question. Will he be good enough to say how many government units have been relocated in Wales, and how many jobs have been created there during the past 10 years?
Lord Brabazon of Tara: My Lords, I am afraid that I cannot give the noble Lord details as specific as that. From my own personal experience in the Department of Transport, I know that the largest unit of all within that department, the DVLC, is located at Swansea. It is very happy there.
Lord Glenamara: My Lords, the noble Lord made no attempt to answer my question. The departments he mentioned were transferred to the North by Labour Governments. The DHSS was transferred by the post-war Labour Government and the national savings certificates branch by the Wilson Government. Will the noble Lord say how many jobs have been transferred to the North-East by this Government during their term in office?
Lord Brabazon of Tara: My Lords, the noble Lord obviously was not listening to my answer, because I quoted an example from last year.
Lord Sefton of Garston: My Lords, in 1978 the Labour Government decided to move 3,500 jobs to the North-West and that move was in progress. Can the Minister tell us whether it is now the Government's intention to restore that move?
Lord Brabazon of Tara: My Lords, the Government's policy on that subject has been announced by my right honourable friend the Paymaster General. The policy is that it is now for departments to decide in their own interests what moves to make and therefore there is no central target. However, as I have attempted to indicate, there are plans under way and a number of moves are taking place.
Lord Sefton of Garston: My Lords, does that mean that the Government are relinquishing power to make such transfers? Will the Minister tell us whether the Government intend to take powers to tell departments to move to the regions?
Lord Brabazon of Tara: No, my Lords. I am not quite sure how the noble Lord distinguishes between the Government and the departments which represent the Government.
Lord Sefton of Garston: My Lords, the Government are elected by the people of this country. The politicians are supposed to tell the civil servants what to do; the civil servants are not supposed to tell the politicians what to do.
Baroness Seear: My Lords, the Minister gave me the percentage figure for jobs in the region. What I asked for was the percentage which had been transferred. That is what we are interested in: how many are being moved out of London? We know that there are many jobs in the regions. What percentage has been transferred from the centre to the regions?
Lord Brabazon of Tara: My Lords, in my original Answer I gave the total since 1979, which was approaching 12,000 jobs. What that represents as a percentage of the total I am afraid I cannot say.
Lord Mottistone: My Lords, will my noble friend say when a government of either party will transfer some large government office to the Isle of Wight?
Lord Brabazon of Tara: My Lords, I am afraid that I know of no plans at present which would involve such a transfer.
Lord Glenamara: My Lords, the Minister did not listen to either of my questions. Is he not aware that the departments of the DES which are now based in Darlington were transferred when I was Secretary of State? Will he please tell us how many Civil Service jobs have been transferred from London to the North-East during the tenure of this Government? Will he consider transferring the whole of the DES to Sunderland to make up for the Government's wanton closure of the shipyard there?
Lord Brabazon of Tara: My Lords, I listened very carefully to the noble Lord's questions. I gave examples of further moves which have taken place: last year the DHSS moved 600 jobs to Newcastle and there was a further move by the Department of Education and Science to Darlington. Those are new moves which have occurred since this Government came to power.
Lord John-Mackie: My Lords, have the Government any plans to move private offices out of London? One of the biggest insurance companies has its headquarters in Perth in Scotland and I understand that it does very well.
Lord Brabazon of Tara: My Lords, we certainly have no plans to force people to move out of London. I am sure that the noble Lord is quite right and that there are advantages in transfer. I should point out that when the Overseas Development Administration moved a part of its operation to East Kilbride my right honourable friend the Secretary of State for Scotland confirmed that, taking account of all the quantifiable costs and benefits, the dispersal is estimated to have produced a significant saving in national resource terms of some £14.9 million. Furthermore, the overwhelming majority of the staff who transferred expressed the opinion that the quality of life was higher in East Kilbride and preferred their new location.
Lord John-Mackie: My Lords, I point out that I did not use the word "force"; I used the word "encourage".
Lord Dormand of Easington: My Lords, the original Answer given to me by the Minister seemed to consist of half promises. When can we have something firm about future policy on dispersal?
Lord Brabazon of Tara: My Lords, in my original Answer I said what the policy was, as the noble Lord will see if he cares to read what I said.

Radiation: Exposure Volunteers
2.56 p.m.
The Earl of Halsbury The Earl of Halsbury asked Her Majesty's Government:
Whether they intend to accept the offer of 100 elderly retired Fellows of the Royal Society and of the Fellowship of Engineering to volunteer for exposure to radiation hazards in the event of a nuclear emergency.
The Parliamentary Under-Secretary of State, Department of Energy (Baroness Hooper): My Lords, the Government very much appreciate the interest shown by the Royal Society and Fellowship of Engineering volunteers. However the nuclear industry is required as a condition of its operating licences to have detailed emergency plans in place and would be expected to rely on its own well-trained experts to deal with any incident. I understand that the CEGB has declined the offer on that basis.
The Earl of Halsbury: My Lords, do the Government appreciate that the offer was a well-meant morale booster? It was a gesture from the older generation, which started nuclear power, towards the safety of the younger generation, which has a greater chance of being exposed to its hazard. Does the Minister recognise that it is very disappointing to feel that the bureaucracy—and it is no more than that—is full of dismal complacency? It could perfectly well have taken the trouble to take names, addresses and telephone numbers and note the willingness of the individuals in question to go on courses and be trained as a morale booster for their juniors.
Baroness Hooper: My Lords, as I said, the Government very much appreciate the offer which was made. I have no doubt that the commitment and specialised knowledge of the volunteers could be useful in some way in the very unlikely event of an emergency. I understand that it is in that spirit that the Atomic Energy Authority has responded to the gesture.
Lord Zuckerman: My Lords, as one of the potential guinea-pigs perhaps I may ask the Minister whether she would agree that there is an enormous amount of uncertainty about the levels of radiation which are noxious. Will she also agree that the experiment which the elderly Fellows of the Royal Society and the other institutions have said that they would be prepared to undertake might provide some information which would reduce the enormous disparity which now exists between what people believe to be safe and unsafe environmental radiation?
Baroness Hooper: My Lords, I believe that our job in government is to reassure people both as to the unlikelihood of such a situation arising and as to the minimising of any effects. Our first priority must be just that: to minimise the effects of an emergency. The procedures which are in place exist to do just that. Nevertheless, as I have said, the Atomic Energy Authority has, I believe, accepted the offer in the spirit in which it was made.
Lord Grimond: My Lords, is the noble Baroness aware that to some of us this noble gesture is rather alarming? Is she aware that many so called elderly, retired Fellows of the Royal Society are well worth preserving, including at least one who is here today? Personally I would much rather have them than the Mappa Mundi. Does she agree that if elderly guinea-pigs are to be found for that purpose such rather useless guinea-pigs as myself might be more suitable than Fellows of the Royal Society?
Baroness Hooper: My Lords, I do not think that any willing volunteer will be rebuffed by the Government. I fully agree with the noble Lord that there are many Fellows of the Royal Society, both retired and present Fellows, who are well worth preserving.
Lord Molloy: My Lords, does the noble Baroness agree that what we have to try to achieve is to remove altogether any possible risk of a nuclear war and to do that we might continue exerting pressure on both the United States and the Soviet Union and encourage the co-operation which now exists between our Government, the United States Government and the Government of the Soviet Union via Mr. Gorbachev?
Baroness Hooper: My Lords, the Question does not, I believe, refer to nuclear arms or nuclear war; it relates to the civil uses of nuclear energy.
Lord Peston: My Lords, can the noble Baroness tell me whether I am right in assuming that people are made Fellows of the Royal Society because of their intellectual achievements and achievements in research and not for their ability in practical matters or because they have any common sense? Is it not likely that such people, admirable though the offer seems to be, will be much more of a nuisance than of any use in those circumstances? If we are looking for volunteers for exposure to radiation perhaps younger people—for example one or two junior Ministers—might feel able to come forward.
Baroness Hooper: My Lords, I take the last part of the noble Lord's question as an unfestive remark. Nevertheless, it is true that the first priority in the very unlikely event of such an accident would be for immediate action. That means that emergency workers would have to wear protective equipment, including self-contained breathing apparatus, and they could be subjected to extremes of heat and humidity. They might be required to undertake very active service. It is for that reason that the emergency plans that are in place concentrate on experts, in effect, in fire fighting.

London Hospitals: Proposed Merger
3 p.m.
The Earl of Halsbury The Earl of Halsbury asked Her Majesty's Government:
When they will reach a decision on the planned merger of the Westminster Hospital and St. Stephen's Hospital onto a single site in Fulham.
The noble Earl said: In asking this Question I draw your Lordships' attention to a drafting error at the end: "in Fulham" should read "facing the Fulham Road".
The Earl of Arran: My Lords, my right honourable friend the Secretary of State is currently considering the proposal to build a new teaching hospital on the site of St. Stephen's Hospital in Fulham and to close the Westminster, Westminster Children's, St. Mary Abbott's and West London Hospitals. He is examining the implications for patients and giving a thorough assessment to all aspects of the scheme, including financial issues. A decision will be announced when this consideration is complete. I regret that I cannot give a date today.
The Earl of Halsbury: My Lords, does the noble Earl realise that that was a very disappointing Answer from the standpoint of the doctors in the hospitals concerned? Quite recently I have had letters on this matter from a consultant at Westminster and a consultant at St. Stephen's. From a retired consultant from St. Mary Abbott's, I also received a Christmas card on which were written the words:
"Poor St. Stephen's! Nothing is being maintained. Nobody knows whether it is going to be pulled down tomorrow or not."
Morale is at a very low ebb. The junior hospital doctors, I am told—I hope that the Minister is aware of this—are on contract only until 31st December this year. They do not know what employment they will get. Does the Minister think that this is the way to run a National Health Service—in a state of perpetual indecision?
The Earl of Arran: My Lords, I take seriously the remarks and comments of the noble Earl, Lord Halsbury. At the same time I say unequivocally that the Department of Health is well aware of the need to make a decision as soon as possible. Any change has major implications for patients and staff. We want to keep to a minimum the uncertainty for everyone involved but this is a major scheme and it is important that it should be carefully considered.
Lord Ennals: My Lords, does the noble Earl accept that uncertainty is not a good reason for taking the wrong decision? Does he further accept that there is tremendous opposition in Westminster—and that includes a petition bearing the signatures of over 100,000 people—to this proposal for the closure of four hospitals, including the major hospitals of Westminster and Westminster Children's which are internationally famous? Moreover, does he accept that there is tremendous opposition to the proposal to move to a thoroughly unsatisfactory and indeed dangerous site for those wishing to have emergency treatment in what would be a very large hospital? Who in fact supports this unwanted, unsatisfactory and expensive project?
The Earl of Arran: My Lords, my right honourable friend the Secretary of State is considering all the views given about the proposals. Your Lordships will be aware that although the media concentrate on opposition to them, there is also very considerable support for the scheme—for example, from the
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medical executive committee of the Westminster and Westminster Children's Hospitals, from the Riverside district medical committee and from the Charing Cross and Westminster Medical School.
Baroness Strange: My Lords, is my noble friend aware how grateful I and my noble relatives were for the proximity of the Westminster Hospital casualty unit when this morning we drove a Portuguese lady there from Parliament Square, where she had been knocked down by a bus? Does he not consider that the six traffic-jam packed miles to Fulham might be very inconvenient for casualties?
The Earl of Arran: My Lords, obviously I am very pleased to take my noble friend's point, as mentioned in the first part of her question. However, I should also like to point out that there is always St. Thomas's Hospital just across the River Thames.
Lord Northfield: My Lords, will the Government be sure to bear in mind two factors that have been mentioned in this House before? First, not very long ago, in the time of the chairman of the governors, the noble Lord, Lord Reigate, Westminster Hospital spent a lot of money on a new wing which is, so to speak, hardly out of date or needing replacement. Secondly, will they bear in mind the degree of local protest in the St. Stephen's area at the congestion that this huge hospital is bound to create by undue concentration in that part of London?
The Earl of Arran: My Lords, the brief and scope of the examination that is currently being undertaken by my right honourable friend the Secretary of State are very intense and very profound. He will certainly take into account every aspect of this proposal.
Lord Auckland: My Lords, while in no way wishing to prejudge the results of the inquiry, is my noble friend aware that I know Fulham quite well and that the road journey from Westminster to Fulham, in the event of a major casualty exercise, can be very long and congested? Will his department consult with the Department of Transport as to the traffic problems between Westminster and Fulham before a decision is finally taken?
The Earl of Arran: My Lords, I rather thought that I had already given a reply to that question. I say again that although Fulham is some way off, it is the responsibility of the ambulance driver and his decision. Once again I repeat that St. Thomas's is only a minute from your Lordships' House or the Palace of Westminster.
Baroness Hylton-Foster: My Lords, in order to keep the record straight, will the noble Earl accept that although St. Stephen's Hospital is in the Fulham Road, it is in fact in the Royal Borough of Kensington and Chelsea?
The Earl of Arran: My Lords, that may be the case but once again I am sure that that is well understood and perceived by my right honourable friend the Secretary of State.
Lord Cocks of Hartcliffe: My Lords, would the noble Earl care to reflect on the remarks of his colleague in another place, the Minister for Roads and Traffic, who recently said that a small number of people sitting down on Westminster Bridge could bring traffic in the whole of central London to a standstill? Does not this negate his remarks about St. Thomas's Hospital?
The Earl of Arran: My Lords, I think we are doing a considerable disservice to St. Thomas's Hospital. Obviously it is hoped that nothing of the magnitude proposed by the noble Lord will happen at the Palace of Westminster. If so, however, there is St. Thomas's and there is also the journey to Fulham.

Business
3.7 p.m.
Viscount Davidson: My Lords, after the end of the short debate on the high level of consumer debt and before the short debate on assistance available to people with mental illness or mental handicap, my noble friend Lord Strathclyde will, with the leave of the House, repeat a Statement that is to be made in another place on British Shipbuilders,
With the leave of the House, I should like, as usual, to say a word about the two short debates standing in the names of the noble Baroness, Lady Ewart-Biggs, and the noble Lord, Lord Carter. It is customary in short debates that the mover is allowed approximately 15 minutes, and that the Minister should rise to reply not less than 20 minutes before the scheduled end of the debates. In the case of the short debate in the name of the noble Baroness, Lady Ewart-Biggs, this means that all other speeches should be limited to a maximum of nine minutes and in that of the noble Lord, Lord Carter, to 11 minutes. If any noble Lord should speak at greater length, it would be at the expense of subsequent speakers in the debate.

Civil Aviation (Air Navigation Charges) Bill [H.L.]
Lord Brabazon of Tara: My Lords, I beg to introduce a Bill to enable charges imposed under Section 73(1)(a) of the Civil Aviation Act 1982 to be prescribed in units of account defined by reference to more than one currency. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time—(Lord Brabazon of Tara.)
On Question, Bill read a first time, and to be printed.

London Local Authorities Bill [H.L.]
The Chairman of Committees (Lord Aberdare): My Lords, I beg to move the first Motion standing in my name on the Order Paper.
Moved, That the Promoters of the Bills which originated in this House in the last Session of
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Parliament but had not received the Royal Assent shall notwithstanding anything in the Standing Orders or practice of this House have leave to introduce the said Bills in the present Session and the Petitions for the Bills shall be deemed to have been deposited and all Standing Orders applicable thereto shall be deemed to have been complied with.
Every such Bill shall be deposited in the office of the Clerk of the Parliaments not later than 5 o'clock on the 12th December next with a declaration annexed thereto signed by the Agent concerned stating that the Bill is the same in every respect as the Bill at the last stage of the proceedings thereon in this House in the last Session of Parliament.
That the proceedings on such Bills shall in the present Session be pro forma only, in regard to every stage through which the same shall have passed in the last Session of Parliament, and that no new fees be charged to such stages.
That all Standing Orders complied with in respect of any Bill which originated in the House of Commons in the last Session of Parliament shall be held to have been complied with in respect of any Bill presented in that House in the present Session provided that the Bill is the same in every respect as that which was presented in the last Session and where the Examiner has already reported that the Standing Orders have been complied with in respect of any such Bill, he shall report only whether any further Standing Orders are applicable.—(The Chairman of Committees.)
On Question, Motion agreed to, and it was ordered that a message be sent to the Commons to acquaint them therewith.

Deputy Chairmen of Committees
The Chairman of Committees: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, That, as proposed by the Committee of Selection, the following Lords be appointed the panel of Lords to act as Deputy Chairmen of Committees for this Session:—

Airedale, L.

Alport, L.

Ampthill, L.

Aylestone, L.

Cathcart, E.

Cocks of Hartcliffe, L.

Cox, B.

Cullen of Ashbourne, L.

Davidson, V.

Denham, L.

Elliott of Morpeth, L.

Grantchester, L.

Hayter, L.

Listowel, E.

Llewelyn-Davies of Hastoe, B.

Murton of Lindisfarne, L.

Nugent of Guildford, L.

Ponsonby of Shulbrede, L.

Strabolgi, L.

White, B.

—(The Chairman of Committees.)
On Question, Motion agreed to.

Hybrid Instruments: Select Committee
The Chairman of Committees: My Lords, I beg to move the third Motion standing in my name on the Order Paper.
Moved, That, as proposed by the Committee of Selection, the Lords following, with the Chairman of Committees, be named of the Select Committee on Hybrid Instruments:—

Brandon of Oakbrook, L.

Cawley, L.

Cork and Orrery, E.

Dilhorne, V.

Fletcher, L.

Irvine of Lairg, L.

Lloyd of Kilgerran, L.

Prys-Davies, L.

Teviot, L.

Thurlow, L.

Wise, L.

—(The Chairman of Committees.)
On Question, Motion agreed to.

Murder and Life Imprisonment: Select Committee
The Lord Privy Seal (Lord Belstead): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That a Select Committee be appointed to consider

(a) the scope and definition of the crime of murder in England and Wales and in Scotland;

(b) the question whether imprisonment for life should remain a mandatory rather than a maximum penalty for murder; and

(c) the working of the arrangements for reaching decisions on the release of those serving life sentences for murder;

this consideration to include such matters as the sentencing judge's power to recommend a minimum period of detention and the means by which the Home Secretary and the Secretary of State for Scotland take judicial advice on individual cases where a life sentence has been imposed.—(Lord Belstead.)
On Question, Motion agreed to.

Consumer Debt
3.9 p.m.
Baroness Ewart-Biggs Baroness Ewart-Biggs rose to call attention to the high level of consumer debt; and to move for Papers.
The noble Baroness said: My Lords, while I am grateful to see so many distinguished names on the list of speakers today, nevertheless, without meaning any disrespect to the noble Lord who will reply to this Motion, I much regret that the Secretary of State for Trade and Industry has not found it possible to be here this afternoon in order to reply to a Labour Party debate. I believe that this subject before the House this afternoon is an important one. It is
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considered important both within the House and by many outside it.
For my part I should like to present the background to the debate by producing some facts and figures, first about sources of credit and, secondly, about the variety of ways in which individuals and families incur debt. Lastly, I should like to say something about the distressing social consequences of such indebtedness.
First, it is important to underline the distinction between credit use on the one hand and indebtedness on the other. Indeed, on looking at the consumer credit market in 1971, the Crowther Report said:
"Consumer credit is beneficial—it makes a useful contribution to the living standards and the economic and social well-being of the majority of the British people".
How right this was when one thinks of the many examples of people being assisted, such as children who will receive their winter coats at the beginning of the winter rather than halfway through because their parents are able to spread the payment over several months on a mail order. Alternatively, a working mother can buy a washing machine on hire purchase to help her in her dual role of paid worker and housewife. Consumer credit of this kind can be regarded only as a social good.
Since the late 1970s the level and very nature of consumer credit and debt has entirely changed. People find it quite natural to borrow but, unfortunately, often do not understand the full consequences of doing so. There is little doubt that they are increasingly encouraged to do so. By an extraordinary coincidence this morning when I was considering this debate, I opened my mail and one envelope contained a letter from Barclaycard introducing a new scheme called "Profiles". The heading stated, "Another chance to get something for nothing". This is rather the refrain that is coming from many quarters. It is attacking vulnerable people who believe that they will be able to get something for nothing.
The number of lending institutions and sources of credit have multiplied out of all recognition. An increasing proportion of aggregate household income is now accounted for by debt service payments. Establishing credit-worthiness by lenders has gone by the board as granting credit is so lucrative that a few bad risks can easily be absorbed. This has brought about a dramatic rise in the growth of personal credit. According to the president of the Chartered Institute of Bankers in a speech as recently as 7th October this year, it stood at over £39 billion. That is an average of about £1,800 per household. This means that since 1983 the amount of credit outstanding has doubled. It must be remembered that this does not include borrowing for house purchase. The amount of mortgage lending outstanding at the end of June 1988 was over £203 billion. Thus consumer debt as a proportion of consumer spending has risen from 7·4 per cent. in 1977 to 13·3 per cent. in 1986. It has just about doubled.
Unfortunately, figures on the other side of the balance sheet show that between 1977 and 1987 the saving ratio halved from 10 per cent. to 5·5 per cent.,

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and the personal sector surplus of £5 billion 10 years earlier was transformed into a deficit of £7 billion. Those are some of the very bald statistics.
Let us now consider the lending institutions and the many different sources of credit that exist. There are the building societies and banks who offer mortgages on house purchases. These loans represent as much as 80 per cent. of credit use. This explosion has occurred for a variety of reasons. First, housing now represents very important investment. Secondly, the Government's accelerated programme of council house sales has increased the demand for mortgages, and as the housing stock diminishes then many more people who otherwise would have taken rented accommodation have no alternative but to buy their home. How difficult the situation must be for first-time buyers when one considers that they now face an interest rate of 12·75 per cent. from building societies and 13 per cent. to 13·2 per cent. from banks. Figures from the National Association of Citizens' Advice Bureaux show that these owner-occupiers are in many cases facing serious problems. For instance, 59 per cent. of owner-occupiers are in arrears with mortgages, and 31 per cent. are behind with a second mortgage or secured loan. Building society repossessions show a steady upward trend with 2,530 repossessions in 1979, but in 1987 this has increased to 23,244. That is a staggering increase.
Let us look at credit cards—another source of credit. Interest rates vary. Save and Prosper charges 19.19 per cent., and Barclaycard's increased rate is 26.8 per cent. The citizens' advice bureaux report that only between 3 per cent. and 7 per cent. of debt problems coming to them were accounted for by bank credit cards. But despite this very low figure, coupled with the positive fact that banks show responsibility in the inquiries they make about applicants, credit cards are a source for incurring heavy debt because the possession of a bank credit card is taken by other lenders as a justification for extending additional credit without proper evaluation. This can certainly apply to the acquisition of a store card, of which the number in circulation has increased to 10·6 million now compared with 5 million in 1982.
On these, the interest rates are very high. Littlewoods charge 34.9 per cent. We know that the Retail Credit Group has published guidelines on the issuing of credit to stores. However, those of us who read the Sunday Times last Sunday may have wondered whether these guidelines have been accepted. Other noble Lords may have read the very scary-sounding story about a 19-year-old secretary who went to 10 high street multiple stores asking for credit for Christmas. To her surprise she was offered as much as £4,700 to spend immediately, with a promise of even more after her applications had been processed. Her only identification was a cheque guarantee card. When replying, I hope that the Minister will comment on this press report. It must have worried a great number of people.
The last source of credit that I have time to mention is the moneylenders and loan sharks who operate in the big cities. The August edition of Which? gave a staggering picture of the APRs they
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charge and of the very aggressive methods of harassment that they employ. For example, the magazine cites a case of one firm trading with a credit licence who offered a loan with an APR of 4,822 per cent. This surely points to the need to strengthen the consumer credit measure of 1984 which states that credit bargains should not be extortionate. Unfortunately, it does not put a figure on what counts as extortionate. My noble friend Lord Bruce of Donington has on many occasions asked the Government to look at this with a view to strengthening the position of the borrower, who after all was very much better protected under the 1927 Moneylenders Act.
Will the Minister also say whether he agrees that one way of weeding out unscrupulous applicants for licences would be for a better liaison between the OFT and the local trading standards officers, whereby the OFT could refer applicants to officers before granting licences? In view of the fact that some moneylenders operate illegally without licences, perhaps the Minister may tell the House how successful the police are in dealing with them and how often criminal proceedings have been brought against the utterly despicable loan sharks.
One knows full well that it is always the poorest families, already up to their ears in debt, which fall back on local moneylenders. Families such as these need all the protection that they can get. It would be hard to describe the suffering and family disruption caused by the harassment and anxiety which result from falling into the hands of moneylenders.
Lastly, I should like to comment on what the citizens' advice bureaux report about the debts which they handle. They handled 500,000 debt inquiries this year, and it would seem that they can not continue to increase their staff in sufficient numbers in order to carry on. They say that 70 per cent. of those who went to them had incomes of below £100 per week. In many cases they were in debt simply because they did not have enough money to pay the bills. But the causes of severe indebtedness, they say, come when a family, with a budget which is already very stretched, suffers a crisis such as redundancy of the breadwinner, sickness of a member of the family or marital breakdown. The fragile structure then comes tumbling down and multiple debt occurs, mainly as a result of their effort to extricate themselves from the original debt.
An increasing number of CAB applicants have problems with their fuel and water bills. Gas disconnections showed an alarming upturn in 1986, the privatisation year. They jumped from 2.9 per cent. in 1975 to 23.2 per cent. in 1986. They continued to rise in 1987 when the increase in disconnections rose to 30.3 per cent. The National Association of Citizens' Advice Bureaux is particularly worried about the figures for water supply disconnections. They have gradually risen since 1982 and showed a sharper upturn of 24 per cent. last year. The association believes that the rise is due to the increases in water charges which have been imposed on water companies prior to privatisation. It is also due to the fact that claimants must meet water rates from benefits rather than as they did prior to the April social security changes when they received

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separate allowance for those rates. The CABs are worried that there may be a repeat of the gas industry's soaring rate of disconnections following water privatisation.
That is a superficial picture of the scenario surrounding the rising level of debt in Britain. I have tried to show how the original advantages of consumer credit are, in many ways, being eroded through the emergence of indebtedness and the social consequences. The CABs have some heartrending case studies of individuals and families who have been drawn inexorably further and further into the quagmire of debt from which they have become powerless to extricate themselves.
A typical example of the spiral effect of debt is of a man in his mid-thirties who went to his CAB. He had had an accident at work and the resulting drop in his income put him into debt. His marriage broke under the strain and he became homeless, which he still is. He now suffers from extreme depression which will probably bar him from work or a home for ever.
This year the Jubilee Centre published a thoroughly-researched paper entitled Families in Debt. It shows how debt puts intolerable strains on the family structure and how those affected suffer from all kinds of problems. They range from mental problems, social withdrawal, physical ailments, marital and family problems. The paper also describes the consequences for the children who grow up under the dark cloud created by debt. It makes their parents fight, brings disruption to the home and deprives them of the things which other children have by way of Christmas and birthday presents and so forth. An American research paper suggests that there is a correlation between child abuse and the financial status of the family.
The Chancellor of the Exchequer has expressed his concern about the effect that increased interest rates will have on families during the coming year. However, that has not manifested itself in policy. He has rejected credit controls on hire purchase and credit sale agreements saying that they would be evaded. However, I cannot understand how banks and finance houses would evade them. Perhaps the Minister can explain that statement. It appears that the Chancellor would be supported by many people if he introduced some controls. The Jublilee Centre research shows that people believe that it should be harder to obtain credit and they accept the fact that restrictions should be imposed.
One can be left only with the impression that the Government disclaim social responsibility and that they are content to stand back and allow the continuing pursuit of profit from credit to continue because that is what best pleases their supporters in City circles and elsewhere
Besides bringing some order to the field of consumer credit, surely the Government should be moving away from placing their whole focus on consumerism and instead promote a philosophy which includes other values. After all, no one is asking the Government to establish a "nanny state". However, in the same way as government action reduces risks to members of society in so many fields,
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they have a responsibility to reduce the risks which so many poorer families and young people run of becoming enveloped and smothered by debt. Let us remember that letting the credit market rip may have been effective in creating competition but it has also led to the unattractive spectacle of a growth in human misery and exploitation.
I should like to end by repeating what was said by Sir Gordon Borrie, the Director General of Fair Trading, in his annual report published last month. He quoted a sixteenth-century sage who said:
"Who goeth a-borrowing, goeth a-sorrowing".
I end on that rather sombre note. My Lords, I beg to move for Papers.
3.27 p.m.
Lord Jenkin of Roding: My Lords, the House will be grateful to the noble Baroness, Lady Ewart-Biggs, for giving it the opportunity to debate a subject which has attracted a great deal of attention among commentators and the press. It gives noble Lords the opportunity not only to share the concerns which she has rightly mentioned but also to dispose of a few of the myths which appear to have grown up about the subject and which should be put right.
Many of us were brought up years ago in an atmosphere in which it was considered disreputable to accumulate debts and it is tempting to become alarmed by the increase in personal debt. I did not disagree with any of the figures which the noble Baroness quoted. I was brought up with the stern warnings about my Uncle Charlie. He had been a prominent juvenile lead on the West End stage. He had enjoyed lavish parties at Claridges and ended up being supported by his family. That spectre was hung over me throughout my youth.
When one is told that personal credit has doubled since 1983—the latest figures that I have show that it was £41 billion by the end of September and that it has risen from the June figure which the noble Baroness mentioned—it is not at all surprising that we in the older generation shake our heads, purse our lips and mutter that it will all end in tears. The noble Baroness is right because for a few people it does end in tears and I shall come on to that in a moment. However, it is important to get the facts into perspective.
I was a Minister in the Treasury when we introduced the historic document Competition and Credit Control. It was the start of a process which has blown the fresh winds of competition and innovation through our whole financial system. When one bears in mind that during the past nine years there has been added the abolition of the corset on bank lending, the ending of hire purchase controls, the ending of exchange controls, new banking legislation and building societies' legislation and the new consumer credit legislation which the noble Baroness mentioned, not to speak of the huge changes brought about by "big bang" it is hardly surprising that the older relationships between income, assets and indebtedness should have changed and should still be changing quite dramatically. Therefore, attitudes have also changed. The noble Baroness mentioned the huge expansion of mortgage lending. That has

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actually made borrowing more respectable and given it a much more favourable image. I believe that she would recognise that the high rates of inflation in the 1960s and 1970s made waiting before buying very unattractive. She quoted Sir Gordon Borrie. I shall also do so from his 1987 report. He said:
"two-figure inflation made debt both economically sensible and respectable since more and more people adopted it as a means of buying not only their homes but the increasing range of consumer products which filled them".
That process has continued. But should we be alarmed? I believe that we should not be alarmed. If one looks at the figures, particularly of the latest trends, it seems that some cries of disaster may appear to be exaggerated. In the few moments I have I shall just make five short points.
As the noble Baroness said, mortgage lending is by far the biggest element in total personal indebtedness; namely, £202 billion, which is about 83 per cent. of the total of personal debt. As the vast majority of mortgages are either repayment or endowment mortgages, that indebtedness is matched by saving on a very big scale. Obviously there are problems for some people who fail to keep up their mortgage payments, but without doubt that has been a hugely beneficial social trend. It is accompanied by some dissaving which was pointed out by the noble Lord, Lord Williams of Elvel, in his speech in the debate on the Address on 29th November. However, as he rightly recognised, higher interest rates will do a good deal to discourage that process. I entirely endorse his verdict when he said:
"I do not think that I would be especially worried".—[Official Report, 29/11/88; col. 173.]
The second point is that bank lending via credit cards has been blamed, quite wrongly, for all the problems of the consumer boom and growing indebtedness. In fact, that only accounts for some 2⅛ per cent. of all consumer borrowing. Around half of all credit card holders pay off the debt during the free credit period so that they are not borrowers at all. The banks' latest figure is that probably about 1 per cent. of borrowers have difficulty in repaying their debt. In the last 12 months the growth of bank card debt outstanding has done little more than keep pace with the growth in the number of cardholders and the rise in retail prices. In any event, they are now the subject of a Monopolies and Mergers Commission investigation, so perhaps we should await the result of that. However, I ask the question: why only bank cards and not other forms of plastic credit like store cards?
That brings me to the question of retailers' credit. That too is an even smaller part of total consumer credit—around 1 per cent. of consumer borrowing if mortgages are included, or 5 per cent. if they are excluded. That is also slackening off. Figures announced last week by the Retail Credit Group show a slowdown in the rate of growth of retail credit during the summer. Although the number of credit accounts continues to grow strongly, the average amount outstanding per account, which is now about £157, is down from a figure of £166; namely, a 5½ per cent. reduction. That tallies with the CBI's recent Distributive Trades Survey of 14th November which
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shows that the earlier strong growth in retail sales is starting to fade. That is entirely in line with my right honourable friend the Chancellor's policy of using interest rates to curb the rate of inflation.
This debate is about consumer debt. Do the banks and stores encourage irresponsible borrowing? That has certainly worried some people. Of course, that matter needs to be watched carefully. However, it is right to point out that the banks refuse some 30 per cent. of the applications made to them or their credit card companies, while the Retail Credit Group tells me that their members' rate of rejection is about 25 per cent. Clearly a good deal of care is exercised there.
The noble Baroness mentioned a report in the Sunday Times. I am sure that many noble Lords in all parts of the House will have read that. It certainly caused me some concern. Therefore, I took the opportunity to check the facts with the Retail Credit Group. The House will remember that that was a case of a young lady of 19 with an income 01111,000 who, the paper said, was allowed to run up £4,700 worth of credit in a couple of hours in a number of West End stores.
The House may take some comfort from the fact that happily, the story turns out to be wildly inaccurate. Time forbids me from giving all the details, but the simple fact is that she was offered credit facilities rather than credit, and not of £4,700 but £1,200, and even then how much use she made of those facilities was up to her. Of course, had she asked for actual credit there would have been the usual references to the credit reference agencies. None of the counter staff in any of the stores with which the young lady dealt had any authority to give her credit and nor did they. They indicated what the sort of limits might be. In fact, references are made to the credit reference agencies only when there is a substantive credit inquiry.
In the light of the facts—and there are a great many more facts—perhaps the Sunday Times owes those retailers, all of which were mentioned by name, some apology and correction.
What about the few people who become overstretched? As the noble Baroness said, it is clear that the vast majority of cases are those where family misfortune overtakes what would otherwise have been perfectly sensible borrowing—illness, unemployment, divorce, separation and events of that sort which overwhelmingly trigger the serious social problems which she described.
Perhaps I may mention to the House that there is a solution which is not widely used; namely, credit insurance. That was suggested by the president of the Chartered Institute of Bankers in the speech mentioned by the noble Baroness. It would be wrong to put limitations on credit. There needs to be a much wider use of credit insurance, and his suggestion was that this is a case where some of the attitudes to inertia selling might be a way of overcoming that. It would be totally wrong, despite all the points made by the noble Baroness, to start putting restrictions on credit. Sir Gordon Borrie has made it clear that he would be totally opposed to anything of the sort.
3.38 p.m.
Lord Ezra: My Lords, I agree with the noble Lord, Lord Jenkin of Roding, that we owe a positive debt to the noble Baroness, Lady Ewart-Biggs, for introducing this debate on the high level of consumer debt. This is an extremely timely debate. As the noble Lord, Lord Jenkin, reminded us, on 29th November we had a debate on the Government's general economic policy, but in some respects this is the social aspect of that economic policy.
There is little doubt that the level of consumer debt is now becoming a pressing social problem. Yesterday I spoke to my noble friend Lord Winstanley, who for many years presented a series of broadcasts on personal problems on Granada television. He told me that in the early years of this decade the most pressing problems were those of unemployment and housing but in the most recent months the question of indebtedness has come to the forefront. From his personal anecdotal view, this is now a very serious problem.
I am glad to note that this matter is being taken much more seriously. The Office of Fair Trading, to whose report reference has already been made, has produced a guide on debt called Debt: A Survival Guide. That is a rather awe-inspiring title. When one sees what that guide regards as the priorities for indebted families it is a bit horrifying. It mentions four priorities: rent and mortgage arrears—you could lose your home; rate arrears—you could land up in court; fuel debts, to which I could add water debts—you could be cut off; hire purchase debts—if you have paid less than one-third, the goods could be repossessed. Imagine the position of people in that situation with those problems standing over their heads.
I am glad to say that this has not only been identified as a problem but that action is being taken in an endeavour to deal with it. Since the middle of this decade there have been many money advice services operating through the citizens' advice bureaux and in other ways. The Policy Studies Institute has recently published a report on the activities of these services and the ways in which they operate. Indeed, a money advice association was founded in 1984 to co-ordinate their work.
However, what slightly alarms me is that we do not seem to know the size of the problem. We know from experience that it is an important problem, but that same institute, the Policy Studies Institute, is launching a study into the whole question of who is borrowing, how many people are in debt and what happens to them. That will take two years to find out, which worries me. Here we have an important social problem, and an independent institute, independently financed, is going to spend up to two years ascertaining the size of it.
There is not the slightest doubt that this is a serious problem. As has been pointed out, the amount of money borrowed for domestic purposes since 1980 has doubled in real terms. The reasons for that have been mentioned—the massive expansion of credit facilities and the consumer boom during the latter part of this decade which has swept many along in its slipstream who have been unable to cope for
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themselves. Without any question, the position has been made worse by the dramatic increase in interest rates.
The noble Lord, Lord Jenkin, pointed out all sorts of reasons why the increase in interest rates is a desirable remedy for the problems that we face, and that was debated by this House on 29th November, but for people who are in debt it has added enormously to their problems. We have had interest rate increases from 7½ per cent. to 13 per cent. since June of this year and that is a massive increase for people who obviously did not expect it to happen.
Therefore, I conclude—and I keep my remarks within a limited time to allow plenty of time for others—by making the following three proposals to deal with the problem. First, I urgently recommend that the Government endeavour to find out the size of the problem. It is all very well to have an independent survey over two years, but we need to find out much more quickly what is the size of the problem. Secondly, we should review the measures already taken to deal with the problem. Are they or are they not adequate? Should we be doing more? How can we identify those case which are really deserving and those cases of indebtedness which simply arise through improvidence? There must be a number of those.
Thirdly—and this comes on to economic policy—I have to say that from the point of view of those in debt, from the point of view of those in manufacturing and from the point of view of those who are trying to export, one of the most urgent priorities is to bring interest rates down. Having brought down interest rates we ought to seek to deal with the credit expansion boom in other ways, as was mentioned in our debate on 29th November. We must give positive encouragement to personal savings and build up the ratio which has fallen to such a low level.
I believe that if those three measures are taken this important and growing social problem can be effectively dealt with.
3.45 p.m.
The Lord Bishop of Guildford: My Lords, like other speakers I am grateful to the noble Baroness, Lady Ewart-Biggs, for introducing this debate because it is recognised by all that this is a matter of growing concern. As I represent an organisation which has many people working at ground level, so to speak, perhaps I may report that it is clearly becoming a widespread concern of the clergy, who are in contact with all sorts of people, that debt is an increasing social problem.
However, as the noble Lord, Lord Jenkin, said, we need to keep a sense of proportion and there is, as I see it, a sort of balance of payments in this matter of consumer credit. On the one hand, we have to acknowledge that credit facilities are of high value to those with the strength of mind and the experience in managing money; but, on the other hand, we must recognise that for those readily attracted by the glitter of advertisements and bamboozled by mysteries like the APR, credit can be a highly priced trap.

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We have lost the Victorian value of thrift. What was left of it was eaten away by the high inflation of the 1970s. It then became economically imprudent to save. Since then, although inflation has been brought under control (for which we are extremely grateful) thrift has now been replaced by credit. The trouble with credit is that interest charges can take on a life of their own. When they are small they can be comfortably suckled, but when they grow they get hungrier and hungrier. The danger point for many individuals and families is that appalling moment when they recognise that their debt charges are increasing faster than income. That is the moment of human despair.
In spite of what the noble Lord, Lord Jenkin, said, I think that it is generally recognised that instant credit is too easily obtainable. I remain to be convinced that the article in The Sunday Times can be so easily and readily dismissed as it was by the noble Lord, Lord Jenkin. Surely the fact is that many people, including young people, can walk into high street stores and obtain credit with hardly a question being asked. Certainly they are given that impression. I believe that they need to recognise that what they are obtaining is not instant credit but instant debt. If we could change the words, that might even indicate to people the direction in which they are heading.
Greatly daring, I raise the question of whether the banks are being as helpful as they should be. I understand that a number of banks are moving over to performance-related pay for their staffs. There is no doubt good and sound reason for doing that, but it seems to be the cause of a significant shift in the approach of the banks to their customers and the basis on which they offer loans. Loans were offered essentially when there was a reasonable assurance that they could be repaid. Customers were advised about the wisdom of taking out loans. However, I am told that some banks are now gratutitously offering overdraft facilities to customers who have not even asked for them. The emphasis, therefore, is shifting from not so much what is wise for the customer but more to what will get business for the banks.
I draw attention to that aspect because the Judaeo-Christian tradition has always been cautious about interest charges. It was called usury in the early centuries and it was forbidden until the 13th century. With the rise of capitalism a shift took place in moral thinking and it then became appropriate to lend money for wealth creation. But there was still great caution as regards the morality of lending money for consumption. That is not an easy distinction to maintain today but nonetheless there seems to be residual wisdom in it.
I wish to draw attention in particular to the human tragedy which results when debt begins to take its effect. It is almost an inevitable constituent part of marriage breakdown and of the other social problems that we have. One essential weapon in the battle against consumer debt is keeping inflation under control. I believe that we need to recognise our gratitude to the present Administration for achieving that. I have no doubt that we should also recognise the importance of people being encouraged to take
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responsibility for their own decisions. If they make unwise credit arrangements, in one sense they have only themselves to blame.
In my view it is not satisfactory to leave the matter there because we have a responsibility for those in the most exposed positions in our society. I hope that there are other actions which can be taken to protect the unwise from falling victim to the advances of the moneylenders and the credit companies.
3.52 p.m.
Lord Diamond: My Lords, I express my gratitude to the noble Baroness. I start by reminding your Lordships that the British people are to be distinguished from all others on this one count. Since the beginning of this century they have displayed a propensity to borrow more and to eat more of their seedcorn than any other competitive nation. That is a deeply ingrained pattern of which we should be aware. If the strength of the nation is based on investment to secure increased living standards in the future and investment supported by saving and not spending and borrowing, then what this nation needs is to be aware the whole time of its propensity to eat its seedcorn and its need to save more and more.
Ever since this Government came into office what has been happening is the encouragement of borrowing and spending. I cannot do better than quote what the Prime Minister said very recently—that too much buying is paid for by too much borrowing. This matters to the nation as well as to the individual. I am very grateful to all those who have taken part in the debate for underlining the difficulties with which certain individuals are faced. That leaves the ground clear for me—if I may put it in those terms—to concentrate rather more upon the impact on the nation. What is good for the individual in total is also good for the nation; that is, to save and not to borrow unless there is an absolute necessity.
I do not share the view that the old lady who needs a coat for the winter and cannot afford it should borrow the money at twice the rate of interest at which I can borrow. I see no reason why that old lady should borrow money at those rates in order to buy what she is entitled to. It is a matter for social security and the conscience of the nation. It is not a matter for encouraging financial institutions to spread their lending net ever wider. As we know from the figures, fortunately the amount of borrowing that is done at that level is almost minimal. It is very small indeed. The reason for the enormous increase in our consumer debt is the amount that has been borrowed by the categories that we call A1, B2, and so on. They are well above category D, which was no doubt in the mind of the noble Baroness when she referred to the difficulty of buying a warm coat.
It is very important that we should have regard to what the Prime Minister said about too much buying being paid for by too much borrowing. It has its economic impact. Excessive borrowing fuels inflation at home and produces balance of payments deficits abroad. I am absolutely clear in my own mind—I see no reason why I should not express this opinion in your Lordships' House—that it destroys moral fibre. To me, financial integrity means earning first and

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paying second; earning first and spending later. There has to be a good reason to depart from that other than in terms of buying a house, where the issue is different because one is really converting spending into rent which is the alternative available to people who want either to buy or to rent.
I take a clear view on that matter. I recognise that it is difficult, when the Joneses are setting the pace on easily borrowed money, for the Browns not to follow them although it will be against their normal instincts to do so. Therefore there is the whole time reason for discouraging credit and not encouraging it. There should be a discouraging of consumer credit which is not based on anything other than desire to spend first and earn later. That is my message.
This situation has arisen, as the noble Lord, Lord Jenkin, made clear, through the Government giving the message from the moment they came into power that the restrictions on borrowing should be removed and that full and free rein should be given to the propensity of this nation to continue to eat more and more of its seedcorn. Every instrument that came to the hand of the Government to control that propensity has been removed. I exclude foreign exchange controls because they were the subject of wise and confidence-making decisions.
I ask whether the present policy of the Government will suffice; but clearly it will not. In the past year there have been 11 variations in interest rates and that is the only policy that the Government are prepared to have regard to. Seven or eight of those variations have been upwards. Inflation has continued at exactly the same pace throughout the year, paying no regard whatever to the interest variations. It is not surprising. We are talking about the hundreds of thousands of ordinary individuals who buy things in shops. The ordinary consumer is not an economist and he does not read the details in the Financial Times leaders. The ordinary consumer gets a general message from the Government. That general message in the Budget was "Everything is fine; taxes are reduced and that means you can spend more".
The general message from these interest rate variations is nil as regards the consumer. How could it be otherwise? The variations have not been made in order to shock the consumer into a realisation of overborrowing and overspending; they have been hidden and muffled. The variations have been 0.5 per cent. most of the time, or 1 per cent. Imagine the aforesaid Mrs. Jones saying to her husband when he comes back from his office in the City, "What does this mean about the Chancellor increasing interest rates?" He explains, "Well, dear, instead of having to pay 25 per cent. on your borrowing for the costume you have just bought at the store you will now have to pay 25½ per cent." She replies, "Oh, isn't that terrible". I am bound to tell your Lordships that Mrs. Jones does not immediately commit suicide. She goes back to the store and buys the pair of Italian shoes that goes with the costume in order to make up the complete wardrobe.
That is how the public have been misled by these tiny and regular interest rate variations into believing that it just does not matter. It does matter, and there
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are various suggestions which, on another occasion I regret to say, I shall hope to put before your Lordships.
4 p.m.
Baroness Phillips: My Lords, first, I should like to say that the Government can rest content. I shall not blame them for everything. We are in danger of blaming the wrong people. I work with retailers and I am constantly amazed that they are blamed if people steal from them. They display the goods and people are tempted and they steal. It is the same with credit. We have always had credit and there is nothing wrong with it. What is wrong is when people do not pay for it.
I grew up in an age when the only way in which one could buy certain things was by credit. However, it was not called credit; it was called hire purchase and co-operative mutuality. But one borrowed before one actually paid for the goods. Nowadays people seem to have the idea that they do not have to pay. I am sorry for the people mentioned by my noble friend on the Front Bench. They get into trouble when they become unemployed. But let us face it, many people know exactly what they are doing when they obtain credit. We have to be careful that we do not support the wrong philosophy. I repeat that there is nothing wrong with credit.
I grew up in a working class street where we had simple values. First, one paid the rent and then one paid for food. If anything else was left one paid for the other things. But one never feared being turned out of one's house or flat because one had not paid the rent.
Where has the idea grown up that when one does not pay for things one can still be supported? The right reverend Prelate is right. I try to carry out my own Christian belief but we have somehow to reassert the whole Christian philosophy in our society. We have allowed it to slide.
The noble Lord, Lord Jenkin, mentioned the Retail Credit Group. It is quite true that its spending, borrowing and credit accounts for a small percentage—about 1 per cent.—of the total. I am fascinated by the ease with which people can obtain credit. I was in a House of Fraser shop one day. The little assistant said to me, "Do you have a credit card?'. I said that I did not. She asked if I would like one. I said, "Will it do you good?" She said, "Yes, I shall get a percentage if I sell it to you'. I said, "Okay, I shall have a credit card". I filled in three pages of detailed information. I had to wait six weeks before it was decided that I could have credit. It may be that the store was suspicious of Baronesses. I do not know. Perhaps I do not look the part.
I am astonished by the stories of how easily people can obtain credit, but that is not my experience. I was suspicious of the story in the Daily Mirror. I have followed it up. The shops did not offer the young lady credit in the way that she described. Why do we quote the press? For heaven's sake, every time the press have quoted me they have been wrong. Why should I believe what they say about anything else? I am astonished that noble Lords should stand up and quote something from the press.

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Credit is with us. Let us train people how to use it sensibly. I am president of the Money Advice Centre. I also helped to write a book on women and money. It may be sexist but women are really much better with money than men. We wrote the book with the support of a bank. I come back to this point. Let the banks and the retailers give more instruction and more attractive leaflets on how to use credit. Credit is with us and therefore I do not take a negative view. We need more training.
I listened to the chairman of the Consumer Council recently. She gave a good speech in which she gave examples of the kind of promotions we do not want. She said that an advertisement for a certain store said, "Up to £2,000 no fuss instant credit. Spend it today". She did not say which store it was so I cannot mention the name. She said that the sales staff could not explain it anyway, so perhaps people will not be stupid enough to take out this credit. Obviously the borrowers must understand the credit agreement and what it will cost in cash. Why is it indecent to mention cash now? Credit is the thing. If people understood the agreement when they obtained credit there would be no danger. Surely they should know exactly what they are doing.
The Money Management Council has simple aims and objects—to exercise a responsible influence on the development policies affecting the financial interests of consumers both locally and nationally. The banks and the credit card companies—we must give them due credit, if that is not a terrible faux pas—are trying to tell people what they are doing when they take out credit. That is what we want. We want information and education on how to use the system.
There is nothing wrong with credit. It is only wrong if one does not pay. Loan sharks are a different matter but the debate today refers specifically to consumer credit. The retailers, banks and credit card companies could start with the women's organisations which are always the leaders of thought. They do not get credit for it but they are always the leaders of thought and information. Let us make sure that our citizens understand how to use something that is with us. Those who get into trouble are a different kettle of fish and the noble Baroness has rightly drawn attention to the matter. However, many people know exactly what they are doing. Let us underline that and make sure that they get the best advice.
4.8 p.m.
Lord Rippon of Hexham: My Lords, we are rightly grateful to the noble Baroness, Lady Ewart-Biggs, for having raised an important topic which has social and economic consequences. On 15th July this year my noble friend Lord Beaverbrook rejected out of hand my plea that the Government should take some action to control the credit boom as part of the battle against inflation. I hope that tonight we shall see that the Government are more aware of the dangers. High interest rates cannot be the only weapon in the Government's armoury. Indeed it can be said that, at least in the short term and until they bring about
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some kind of recession, they actually fuel inflation. The Government should now take some action to stop the banks and others generally encouraging borrowing at excessive rates of interest.
It is worth noting that those countries which have the lowest rates of inflation and the lowest interest rates are countries like Germany and Japan where the people are accustomed to paying as they go. It is the failure to control credit which underlines the Chancellor's present predicament. The problem is not just house mortgage advances. Indeed it can be argued that those are wise in the sense that the borrower is making a long-term investment for himself and his family. What I believe is having such a devastating effect is the rapid rise in personal debt—day-to-day consumption—urged on by every means in their power by the banks and every other supplier of credit.
My wife, who fortunately for me is not a plastic money addict, was not impressed by a letter she received a week or so ago from the Midland Bank offering, presumably in addition to the Access card, a Midland Flexiloan. The letter, which is addressed to "Dear Customer", says:
"Imagine, the benefit of having a cash reserve available for your Christmas shopping, or the joy of taking a winter break at short notice. Flexiloan can help you with necessities or luxuries alike and even the odd emergency… You decide your limit from £500 to £3,000".
It is only fair to add that the supporting documents make it clear that the current APR is 20.9 per cent.—although they add that the figure may vary. That is a relatively modest percentage compared to some of the examples given by the noble Baroness. Is this the sort of action that the banks should be taking at present? Is it desirable that people should be urged to do their Christmas shopping by borrowing at 21 per cent. per annum?
According to this month's issue of Lloyds Bank Economic Bulletin, lending to persons has grown at almost the same pace as sterling bank lending to the economy as a whole, but that of the banks has grown faster—namely, 31 per cent. in 1981–87—and that of the building societies more slowly, at 17 per cent. Even so, the banks themselves account for no more than half of the total of consumer credit; retailers, and others, are in the business as well.
As Mr. Alistair Graham, the director of the Industrial Society, said at the annual conference last month of the Consumer Credit Trade Association:
"It has become like a bizarre religious ritual for some to collect as many cards as possible and then these are produced in the office or pub like a war veteran parading battle medals".
In the process, of course, the young are being trapped in a spiral of debt. I believe, as other noble Lords have suggested, that at the very least, much more needs to be done to explain the basic ground rules regarding the use of credit cards. As the former government Minister for consumer affairs, Mrs. Sally Oppenheim-Barnes, has said:
"Credit firms give many customers no idea at the outset what the final cost of their borrowings will be".
I commend to the Government her suggestion that there should be a full explanation of the cost added to all credit agreements.

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Credit cards are all very well for those who use their cards for payment on demand. They in effect get an interest-free loan at the expense of the poor and the young. The damage is done to those who, when they receive their account, meet only the minimum that is asked for. This is a very clever situation. You get your credit, then in comes the bill and you need only pay £5—and then you are hooked. I think that there should be a higher minimum initial payment.
The Lloyds Bank Economic Bulletin goes on to give some of the reasons for this revolution in bank loans to persons. The first reason is that personal lending is more profitable to the banks than lending to large companies. I suppose that the banks, having done their best to ruin the third world, are now starting on our children. I find it horrifying that it is estimated that one in five younger credit users are now having repayment problems.
Another reason given for the rise in personal debt is that qualitative guidance to the banks by the Bank of England was first relaxed and then finally abolished. I think that that was a mistake; I think that it should be restored. In my view a great deal could be done without legislation, or credit control; for example, by the Bank of England telling the clearing banks that they must stop lending so much money and that they must behave responsibly in the national interest and restrict credit to necessary purposes. That is the key: credit to necessary purposes.
There may be something to be said for a loan to buy a winter coat or, much more sensibly, to buy a consumer durable like a washing machine. But there is no justification, in my view, for banks at a time like this to urge people to borrow money for a winter holiday break in the sun—hopefully in the sun.
In the present circumstances I think that we must also have regard to the way in which some people are being literally conned into rates of interest well beyond those imposed upon bank credit card holders or by retail shops. I think that there are strong grounds for urging the Government to introduce a new moneylenders Bill. Indeed, it might be called a usury Bill. It is interesting to note that in Texas, in the United States, the maximum rate of interest is still 15 per cent. and anything above that figure is usury. Indeed, I think that it is still usury today.
The combination of high interest rates and the credit boom is doing great damage at present both to our economic and to our social structure. I think that the young have a right to be protected from the worst excesses of quite dreadful loan sharks. I compare them to Mafia loan sharks. Indeed, the Mafia loan sharks look like charitable institutions compared to some of the people who are acting in this field today. I do not think that it is good enough just to say that people have a choice and ought to know what they are paying for the credit which they are being induced to seek. I hope that the Minister replying to the debate will have something constructive to say about the way the Government intend to tackle this increasingly serious economic and social problem.
4.16 p.m.
Baroness Lockwood: My Lords, I share the concern of my noble friend. Her Motion refers to the high
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level of consumer debt. The problem is both a personal and a national one. It is a strange irony that the nation facing, as it does, a severe balance of payments problem can probably find the cause in the increasing credit boom which we are now experiencing.
Some distinguished economists claim that the imbalance in our trading accounts stems not from overseas investments—as others would claim—nor from a growth in the import of capital goods to re-equip our industries, but from the City borrowing from abroad in order to fund loans to British consumers to purchase consumables imported from our overseas competitors. What a world turned upside down this is!
It is a real national problem, but for many it is also a very severe personal problem. Plastic cards are a new method of exchange, but because we are not handling hard cash this method of exchange is more difficult to manage. Some of us, as the noble Lord, Lord Rippon, has indicated, take advantage of the free loan on our credit cards. But others, less fortunately placed, become burdened by high rates of interest over a long period of time. Therefore help in the form of education in money management is very seriously needed.
I should like to say at this point that I welcome the announcement I saw from the DTI a couple of days ago that it is issuing a video for the young on how to manage loans and lending. I think that such a video can play a most important role. However, the problem is wider than that: adults also need help, education and information about the whole problem.
One method of education and information could be through advertising if, as my noble friend Lady Phillips indicated, all the conditions of the loans were made known. It is this area of the problem upon which I should like to concentrate. I must declare an interest as a member of the Advertising Standards Authority. Advertising for credit is governed by the advertisements and quotations regulations under the Consumer Credit Act 1974. Enforcement of the regulations lies with the local trading standards departments and the Office of Fair Trading. Advice on the interpretation of the regulations can also be obtained from these bodies. The Advertising Standards Authority is a self-regulatory watchdog of advertising standards. It has no statutory powers; it is concerned with the content of advertisements. However, through its complaints and monitoring procedures it has been involved in credit advertising. Its experience—widely shared by those involved, I believe—is that the present regulations are exceedingly complex and difficult to police.
The ASA has been particularly concerned about advertisements for credit based on secured loans. This is especially important in view of the figures that my noble friend Lady Ewart-Biggs gave in relation to repossession of houses currently mortgaged. In a recent exercise in which the ASA monitored a selection of print credit advertisements—I must underline that print credit advertisements are not television advertisements because that is a responsibility of the IBA—the ASA found it necessary to give advice to more than half the

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advertisers. The problems encountered in the advertisements revealed that a large number of those offering secured loans used words such as "secured loan" in very small print, "sorry, no tenants", or "home owners and mortgage payers only". In the view of the ASA, these advertisements, although technically correct were not sufficiently clear. The ASA feels that, because advertisements for secured loans are concerned with such an important issue for would-be borrowers, the advertisement should state without any ambiguity that the loan is based on the property.
I understand that some steps are being taken to try to deal with this problem. Indeed, in 1987 the Department of Trade and Industry issued a consultation paper on the current regulations. In March this year it issued draft regulations and invited interested parties to comment by 20th May last. The draft regulations seemed to be a vast improvement. The explanatory memorandum states:
"The main aim … has been to simplify the Advertisements Regulations, while at the same time providing additional safeguards for consumers".
Some of the problems raised by many noble Lords are covered in the draft recommendations. I welcome them. In particular, I welcome the statement that:
"In the case of a loan to be secured on a borrower's home, a statement in the following form must be included in both intermediate and full advertisements:—
'Your home is at risk if you do not make repayments on a secured loan' ".
No one could misunderstand a statement like that if it were clearly stated in the advertisement.
Can the Minister say what has happened to the draft regulations? A recent telephone call to the DTI confirmed that the department is still examining the responses. Surely there is much urgency about the matter. I would welcome a reply from the noble Lord. Advertising is only one aspect of the problem that we are discussing this afternoon, but a firm lead from the DTI on the advertising regulations would contribute to a better informed public both on the advantages and the disadvantages of credit.
4.26 p.m.
Lord Brocket: My Lords, I am grateful to the noble Baroness, Lady Ewart-Biggs, for bringing this subject to the attention of the House. With Christmas round the corner and inflation being the prime concern at present, I think that the debate could not have been called at a more opportune moment.
The problem of consumer credit and the trail of problems that it leaves in its wake are social and economic issues that I think are not being given the attention that they deserve. The Government, quite correctly I believe, have changed the country's thinking in that it is admirable to be successful, and one's natural inclination to accumulate wealth is neither perverted nor in any way wrong; in fact, it is to be encouraged. If this success is to be reflected by purchases that would otherwise previously not have been possible, then more power to your elbow.
The down side of all this of course is that those who have not yet reached that degree of affluence, who are
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too young or quite simply less able see these outward signs of affluence, want them and are delighted to find that banks, credit card companies and stores fling money literally at them and offer them credit facilities to assist them to obtain what otherwise they would not be able to obtain. Who can blame them for accepting this? It is not a case of, You can lead a horse to water but you cannot make it drink"; it is more a case of, "You can lead a horse to water but you cannot blame the poor animal if it does drink".
Among my staff I have pathetic examples of people who have been given credit that they have no hope of financing and who are now reduced to nervous wrecks in their inability to face literally an insurmountable problem. In some cases this has led to excessive drinking and extreme resentment against the system that they see at fault for landing them in this mess in the first place. I think that we are being extremely irresponsible in allowing this state of affairs to continue unabated.
High street stores are giving credit sometimes up to £1,000. I note what was said about the article in the Sunday Times, and I know that this is a fact certainly here in London—with few or no questions being asked. The ability to pay seems of little or no interest to them. The applicant's name and proof of identity are often the only questions asked. Credit card companies give out plastic cards like Christmas cards. There is no proper check on the facts that are given on the application forms. Shops display misleading and confusing signs about credit arrangements. Such signs as "free credit" should read "absurdly ridiculously high credit". There is currently a major high street electrical chain that is offering credit advertised as "free credit" which is in fact 40 per cent. per annum. If the small print is noticed on that sign, most people would not understand it anyway.
Lastly, banks far too readily give loans in the form of mortgages to the absolute maximum that their clients can afford, so that a slight change in circumstances tips the balance and puts well-meaning but naive people and their families into appalling straits. Quite simply, we owe it to these people, especially the disadvantaged, whether from skills or living in a depressed area, to take simple measures which are well within the Government's power to lessen the consequential economic and social problems, particularly that of inflation.
It is in the area of inflation that I have to admit I have a total and utter mental block. The Chancellor tells us that it is consumer spending that is rising too fast and that is causing the dreaded curse of inflation. Bearing in mind the problems regarding credit that I have illustrated, it would appear to me that we have an even stronger reason for taking measures to curb easy credit. However, the Chancellor has elected to use the blunt weapon of general interest rates to curb spending. This means that entrepreneurial businesses, small and large, that always have large borrowing and are the lifeblood of the economy and the power behind Britain's recovery, are hit extremely hard. But it is not the businesses that are buying new machinery that are causing the inflation. It is common or garden consumer spending.

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This interest rate measure appears to me to be like going to the noble Lord, Lord Colwyn, complaining of toothache and the noble Lord hitting the patient over the head with a truncheon and knocking him unconscious. While I admit that that measure would cure the toothache for a while, as the patient would not feel a damn thing, it does not go to the source of the problem. There is no disrespect intended to the noble Lord, Lord Colwyn, as I am sure he does not advocate the use of truncheons in his surgery. Furthermore, we are repeatedly told that a strong pound will reduce inflation. This one has me competely stumped.
I have to declare an interest in that I manufacture in America and export to the United Kingdom, and a further interest in that I manufacture in the UK and export to Europe and America. It will come as no surprise to anyone in this House that it is the American company that is doing well and the UK company that has its costs rising and its exports falling. Lower corporate tax rates are of little consolation because we, like most companies, gear up as much as we can anyway.
It is possible that I am being extremely thick, but I have bluntly to admit that the logic of the Chancellor's measure seems totally to have escaped me and many others as well, including my professional advisers. I am sure that there is a good reason for his solution, but I wish that he would let me in on the secret. I am told that the Government are against controls involving consumer spending and I hear mutterings about individual freedom being infringed. Freedom of choice of goods will not be affected. The price of the goods will remain the same and all controls will achieve is the prevention of many people's misery and a great benefit to the economy.
In particular, first, I should like to see the minimum age for credit raised to 18 years and rigidly enforced by law, with stiff penalties for breaches. Secondly, credit notices in retail outlets should have the actual interest rate clearly displayed in the same size writing and not in the jargonised small print that the average buyer quite plainly does not understand because he is not a trained accountant or lawyer. Thirdly, credit facilities should be granted only when confirmation of bank liquidity, present commitments and the applicant's earnings are received. Lastly, and most important, there should be a legal minimum deposit on goods of not less than say, 30 per cent. That could be altered at the Chancellor's discretion.
I believe that this treatment, rather than the Chancellor's present treatment, would attend not only to the right area of the patient but to the right tooth. The truncheon would therefore not feature in the inventory of any dentist's surgery.
4.35 p.m.
Lord Cocks of Hartcliffe: My Lords, I, too, should like to thank my noble friend for introducing this debate and I should also like to reinforce the remark she made about how easy it is for young people, particularly when they move away from home, to sink swiftly into a morass of debt through the enticements which are offered. But we live in a borrowing society. The noble Lord, Lord Diamond,
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said that people do not relate their borrowing behaviour to such matters as interest charges. I believe they also do not relate their spending behaviour to matters like interest charges because our balance of payments problem, which has led to the recent increases in interest charges, has been largely fuelled by the purchase of imported goods.
On the radio this morning I heard that the latest figure for imported cars will be some 58 per cent. of the total purchased. If that is so, I believe that people are making a conscious decision which contributes to the economic problems facing this country.
The noble Lord, Lord Jenkin, said that happily few people became overstretched when borrowing. Would, that that were really true. The old ethos has faded where one saved before one spent and one did not fall into debt. In many working class homes it was a matter of honour that the family owed no debts and that there was always money to pay for the inevitable funerals. That ethos has unfortunately faded. I was interested in the remarks of the right reverend Prelate because, on the one hand, he said that those who take unwise decisions have only themselves to blame and, on the other hand, a little later in his remarks he said that we have a duty to protect the unwise.
One has to balance those two remarks because there are many in society who do not understand the ways of finance. I was very much at one with the noble Lord, Lord Rippon, when he spoke about the people who were preyed on by loan sharks who charge exorbitant interest rates which are quite astronomical and who use unscrupulous methods of collection. They even go so far as to impound people's benefit books so that they can go with them to the post office and collect the money which is owing as they emerge. It is a great social evil and a scandal. Much of this borrowing behaviour stems not simply from the fact that people are needy and deprived; it stems also from the fact that there is this borrowing ethos in society.
In the Bristol area much concern has been expressed about this matter. In the last two years the local Evening Post paper has taken a great interest in it. My attention was drawn to it by a former colleague of mine on the city council, Councillor Hicks, who drew my attention to inordinate pressure on council house tenants to purchase their properties. Noble Lords will be aware of the opportunities that have been opened by recent legislation, but that is being taken advantage of by the kind of people to whom the noble Lord, Lord Rippon, referred. Leaflets have been pushed through people's doors on the big council estates inviting them to purchase their homes and suggesting the following. It is easier if I were to quote words which I mentioned in another place:
"You can afford it with no cash outlay whatsoever and no obligation".
If one is foolish enough to fill in one of those leaflets and return it or to contact the telephone number, somebody will come to the door to press the matter further. Although rebuffed, he may well return later for a second and even a third call.
People in robust health can deal with such a situation without difficulty, but for the elderly living alone that kind of pressure is extremely worrying.

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Their main concern is to have a roof over their head and anything which disturbs the normal tenor of their lives is of great concern. That sort of abuse is going on. I echo what the noble Lord, Lord Brocket, said about the problems of people reading the small print and understanding fully their obligations. I should like to hear from the Minister that the Government are prepared to put much more effort into providing credit advice and debt counselling services which some progressive authorities are already getting off the ground. Those services are extremely important. Busy councillors cannot cope with the flood of queries they receive; with the best will in the world they often do not have the necessary specialised knowledge. A small amount of funding into the debt counselling services would pay very good dividends in terms of benefit to society.
In addition, since the Secretary of State for Education and Science is producing his national curriculum, surely these matters should be explained in the schools. If it can be explained in the schools just what is implied by borrowing at certain rates of interest, if the rackets going on can be exposed then the children will go home and talk about it so that there will be a fertilisation upwards. The information will spread very quickly. I urge the Government to look into these matters because the current climate of borrowing in society is having these unfortunate effects, particularly on those least able to look after themselves.
4.41 p.m.
Lord Meston: My Lords, I intend to speak only about the operation of the Consumer Credit Act 1974 and how it affects the most hard-pressed debtors. The forerunner of that Act was of course the Crowther report, which looked at the whole matter of modern consumer credit in its widest context. It echoed J. K. Galbraith when he stated what we now realise to be the obvious. He wrote that consumer demand comes to depend more and more upon the ability and willingness of consumers to incur debt. He pointed out that advertising and emulation which create demand operate both on those who can afford to incur debt and on those who cannot. That is the price we pay for a higher standard of living. However, there is also a price to be paid, for example, as a result of increasing house values. Houses cease to be seen as homes but are portrayed as a source of cash. That is a very dangerous trend.
It is not just a problem for the affluent; research shows that those on the breadline get into debt not just because of fecklessness or extravagance but as part of the struggle to meet the necessities. Health and marriages suffer and matrimonial financial litigation—with which I am familiar—can be little more than a debt clearing exercise. When a family is together, there is just enough to provide one home and provide for one household. But there is rarely, if ever, enough to provide for two homes, two households, if the family splits up. The burden falls upon the diminishing public housing sector.
The most hard-pressed are the most vulnerable to the so-called loan sharks; the people who have to borrow from Peter to try to repay Paul. Short-term
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unsecured loans become all too easily long-term secured loans. To take up a point made by the noble Lord, Lord Jenkin, it may well be right that banks and the more respectable lenders are increasingly careful about those to whom they are lending. The more careful they are, the more people will have to be attracted to the less scrupulous lenders.
The expression "loan shark" is colourful but somewhat imprecise: the range is from the backstreet lender to the high street bank, particularly if we have a sufficiently unfavourable view of our bank manager. Mine, I hasten to say, is a saint. The unlicensed lenders are outside the law. They are the people who take the social security book away to use as a form of security. In looking a t the Consumer Credit Act and how it works, one is concentrating on licensed lenders and the protection that is meant to be given by the modern legislation. However we must not overlook the point made in the article appearing in Which? in August this year, to which the noble Baroness, Lady Ewart-Biggs, referred. The point made in that article was that the present licensing system for lenders needs a careful overhaul.
I wish to take up a matter which has been mentioned on previous occasions by the noble Lord, Lord Bruce of Donington, as to the effectiveness of the Consumer Credit Act 1974. In theory the Act gives those who would otherwise be easily led into debt an opportunity for a second thought. It gives them advance information about the terms on which they are to borrow, assuming that they understand the terms "APR", "total charge for credit" and "secured debt". In fact few people really understand those concepts. Lawyers and accountants themselves have to fight through a mass of regulations and interest tables to try to discern the reality of the transaction.
Having got into debt in this way, it is not particularly easy under the scheme of the Act to get out of debt. If one wants to repay early one must grapple with the early redemption regulations, which could not be accused of simplicity. However it is the workings of Sections 137 to 140 of the Act which seem to me to be a cause of the greatest concern. This is not a particularly technical matter; those provisions enable the courts to reopen extortionate credit bargains. The old Moneylenders Act used the expressions "excessive interest" and "harsh transactions" which were quite easily understood. It provided a presumption that 48 per cent. interest was excessive. The Crowther report recommended retention of the 48 per cent. presumption, but the 1974 Act did not follow that recommendation. We have the new terminology in the 19'74 Act. Its main phrase is "extortionate credit bargain" and it does not take a great deal of thought to realise that something which might have been excessive under the old law will not necessarily be found extortionate under modern law.
However it is worse still, because there is a definition of "extortionate" in the 1974 Act. It is defined as meaning "grossly exorbitant" or "grossly contrary to the principles of fair dealing". In other words, it is not enough for the court to say that a loan is exorbitant; it must be found to be grossly exorbitant before the law can begin to intervene. It is

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not easy to persuade a judge that something which is or might be exorbitant is grossly exorbitant. Even then the court is allowed a discretion as to whether and to what extent it will intervene. Of course the high risk lender is entitled to reasonable protection, but I suggest that the law in this area is weighted too heavily in favour of the lender.
Time is not available to mention all the other abuses which are prevalent. I wish to mention some of them, such as the abuses used by the secondary lenders. These are abuses which ensure that such lenders make their money early and make that money, come what may. A borrower goes along; he wants £2,000. Before he knows where he is he has been landed with a bogus arrangement fee charged by the lender, another bogus fee charged by the broker, who is very often the lender under a different corporate hat, and he is being lent £3,000. He is too hard-pressed to resist and signs the agreement.
Another abuse is for the secondary lenders to pretend to be doing the borrower a favour by taking over his mortgage arrears or his existing mortgage itself, whether or not the mortgagee wants that to be done. When the borrower gets into trouble—as he very often does—the benevolent lender offers to reschedule the loan, recycling the whole transaction and effectively charging interest on interest. As the right reverend Prelate said, the indebtedness feeds upon itself.
Of course there is a limit to which the law can go to protect people from themselves, but I suggest that we have not reached that limit. As the noble Baroness went back to the 16th century and reference has been made to the Usury Act, I venture to give the Government a suggested precedent. In 1545 Henry VIII repealed his father's Usury Acts. The preamble to the 1545 Act had an amazing level of candour. It said that the existing laws were so:
"obscure and dark in sentences words and terms",
that the law was of little effect, and that offenders had actually been encouraged to use the law. I suggest that the Government would do well to take a leaf out of Henry VIII's statute book.
4.50 p.m.
Lord Graham of Edmonton: My Lords, I am very pleased indeed to have the opportunity of speaking in this debate, which was so ably opened by my noble friend Lady Ewart-Biggs. On reflection, I think we have had a very well balanced and well informed debate. I wish to declare an interest in the form of my association with the co-operative movement. When that movement was established about 150 years ago, one of its cardinal principles was that no credit should be given. The success of the co-operative movement in those early years was partly due to the experience of those who were pioneers of the movement who recognised that working people, poor people, unemployed people and defenceless people were the greatest victims of the use of credit.
The Truck Acts, which gave to employers the right to pay wages in the form of food, bound workers forever in the grip of landlords and shopowners in a terrible way. The co-operative movement recognized
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that credit was an evil in those times. But in 1988 the co-operative movement, like many others, has recognised the important part that credit plays in its affairs. In 1988 the co-operative movement took more than £5 billion over its counters. I imagine that a sizable proportion of that money was taken in the form of credit trading.
I liked very much the contribution of the noble Lord, Lord Rippon of Hexham, who I thought not only spoke good sense, as he always does, but who put before the Minister who is to reply some very important questions. He suggested that it was no good the Government wringing their hands about the problem of debt or credit unless they were prepared to do something about it. One of the themes that has emerged during this debate from all around the House, but especially from this side, is that there is an overwhelming demand for consumer advice and advice upon the management of money. One of the things I want to hear the Minister say is that he is prepared to help to reverse the Government's trend over the past 10 years, which has been in effect to downgrade consumer advice centres.
Ten years ago, when I was happy to serve at the Department of Prices and Consumer Protection, one of the great things that the then Labour Government did was to encourage the establishment of consumer advice centres. Many councils in the 1980s have not only had to abandon them, but through Government action, they have been given very little financial support to maintain them. I want to hear the Minister say something about the provision of centres which are non-political, which are dependent upon resources from the Government, and which, give the kind of advice to which, I believe, consumers are entitled.
Reference has been made to those individuals who by fecklessness, if not recklessness, get themselves into difficulties. The tag which comes to my mind is caveat emptor—let the buyer beware. I do not think it is an unreasonable proposition to assume that people who seek credit should at least have some idea of what they are letting themselves in for. Certainly legislation has been provided over the years which lays down responsibilities and duties upon retailers, the providers or the givers of credit, to make certain that there is an understanding about the terms and conditions and other matters involved in the giving of credit.
One of the interesting things that has emerged from this debate is that while we are looking at consumer credit, what we are really talking about is credit that is given by retailers in shops. What emerges is the stark fact that 3 per cent. of consumer credit is in the form of mortgages for housing. I want to hear the Minister address himself to how he intends to reduce the burden of consumer debt in the form of the cost of housing, which represents 83 per cent. of total consumer debt. The Government have a great responsibility, not only as regards interest rates in general, but especially as regards the high cost of borrowing in respect of housing.
I was also interested to hear of the very small amount of debt which is accounted for by retail credit accounts. I understand from the figures that it

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amounts to £157 per account. That sum is not, in the context of the current debate, chicken feed, but we must recognise that that amount is coming down. I was interested in the references that the noble Lord, Lord Jenkin of Roding, made in rebuttal of a general premise that was allowed to be given in an article in the Sunday Times last week. I shall be interested to read what the Sunday Times writes next week in the light of the information which it now has. I understand that the newspaper could quite easily have obtained that information, if it had done its homework well in advance at the time.
The young lady referred to in the article was called Helen Davis. The article stated that in Dixons:
"Davis was granted £1,500 of instant credit when she opened her Dixoncard account."
Like many people I considered that to be an irresponsible action. Yet a retail finance organisation has informed me and other people that Helen Davis:
"Filled in a postal application—not instant credit—for a credit limit of £240. The monthly sum payable was £10. Identification was provided with a cheque guarantee/debit card."
In the light of the conflict as regards, first, what happened and, secondly, what the facts are according to Dixons, we are not being very well served by some people who have a boat to push out on this issue. One must recognise that the incidence of credit is real and important, that it will not go away and that there are organisations which undoubtedly make it far too easy for the consumer to take advantage of what they have to offer.
I wonder whether the Minister will say something about the increase in the debt which is now hanging around the neck of owner occupiers who, of all classes of people, have been encouraged by the Government to trade up in respect of the houses they occupy. I hope that the Minister will say something about council tenants who are being encouraged to buy their houses. When one sees the great increase in debt that has occurred over recent years, which has, in effect, been generated by Government policies, I think the Government have a great deal to answer for.
I have an illustration from the citizen's advice bureau at Stoke-on-Trent. When it analysed the queries of 200 of its clients, 59 per cent. of the owner occupiers among them had problems as regards arrears with their mortgages. Of the council tenants who came to them, 44 per cent. had problems with rent arrears. When the figures were analysed further, 31 per cent. of the owner-occupiers were in arrears with a second mortgage or secured loan.
I know that my speaking time is almost up. I think that the Government must not be glib; they must not say that we are in a marketplace in which people are entitled to choose—although choice is the flavour of the month for this Government. I say that the Government have some responsibility to people who need protection not only from themselves but from some elements in our commercial community who are making it very easy indeed for ordinary people, who are desperate to maintain some standard of living, to get into trouble.
5 p.m.
Lord Peston: My Lords, we are indebted to my noble friend Lady Ewart-Biggs for introducing this debate. I am impressed not only by the debate in general but also by its non-partisan character. There have been a great many contributions from all parts of your Lordships' House with some or all of which I am able to agree. I expect that that is also true for other noble Lords. But that is not surprising. As noble Lords will recall, in the debate on the humble Address last week the noble Lord, Lord Vinson, said that many of your Lordships would share the universal anxiety that much money being spent is not consumers' own money but money which they have borrowed. Last week he went on to ask the Government—who after all are his friends—to examine and not to dismiss other forms of sensible control of personal credit. Similar points have been made by noble Lords this afternoon.
I am not opposed to credit or debt per se. I shall not moralise on that matter. It happens that personally I find being in debt quite horrible. I cannot cope with it, and on the whole I am not in debt. However, many of my friends seem to be perfectly happy being perpetually in debt and living on an overdraft without any other visible means of support. So I do not moralise. Credit is part of an advanced industrial society. It is a matter of degree, of control, and of its effect in terms of the behaviour of the economy.
We must not be naive about what is going on. The banks and the financial institutions find the provision of personal credit enormously profitable. They are in the business of offering personal credit. The retail firms are in the business of selling goods and services and they do it to make money. In so far as they offer credit, that is the reason why they do so. We should not be naive about that. It is perfectly clear what the forces at work are.
To be set against that we have heard suggestions that it would be better if consumers understood these things rather more; it would be better if the advertisements were clearer; it would be better if more advice were on offer. My noble friend Lady Lockwood referred to the DTI video. Of course we are in agreement with such measures; but in view of the force of sheer profitability on the other side, much as I support the suggestions, I do not believe that such measures will be other than quite minor in their effects on the problems—both economic and social—which have been mentioned.
That takes me on to the question of whether criteria or standards for the provision of credit have fallen. That is difficult to measure but we must use our common sense. I can only say that in my lifetime—in terms of the ease of obtaining a personal loan 20 years ago, 10 years ago and now—standards have certainly fallen. It was almost impossible for most people to get a personal loan 20 years ago, and for young people it was totally impossible. Again I do not moralise and I am not saying that it is altogether a change for the worse; but to suggest that there has been no change and that it is not easier is ridiculous: of course it is infinitely easier to borrow now.
It is also preposterous to suggest that the Government's financial deregulation, which has had

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many good sides to it, is not one of the underlying causes of what is going on. It is preposterous to suggest that at least some of the consumer boom that we have experienced is not credit-based. Of course it is credit-based. To the extent that financial policy is out of control—and it is—and to the extent that monetary policy is out of control with every single measure of money supply currently well beyond any targeted or desirable range, of course problems have arisen in this area for the economy. It is therefore not in the least surprising, and one does not have to be a monetarist, to note that the effect is both overheating, too high an inflation rate, and a major balance of payments deficit on current account.
None of us need doubt as the noble Lord, Lord Diamond pointed out, that because of the credit boom the structure of the system has gone wrong. I speak as someone who is not opposed to consumption per se; but there is excessive consumption and too little investment. For the Government to point to one year of investment boom as if that somehow makes up for all the earlier years of lack of investment is quite absurd. On that subject, I entirely agree with the remarks of noble Lords and in particular the noble Lord, Lord Ezra, that much more needs to be done to promote saving at this stage rather than consumption.
So the Government have created not merely the social and personal problems to which excessive credit expansion gives rise, but it has created overall a major economic problem. It has created it needlessly. We did not need to move at this pace. It was not necessary for the Government to give up all the means of intervention in financial markets which they gave up. Speaking as an economist, it was absurd of the Government to end up with just one weapon—namely, the interest rate—to deal with every economic problem confronting it. That has been referred to by noble Lords as a blunt weapon. I assume that it is the equivalent to the truncheon which was referred to.
It is a ridiculous state of affairs when there are other means, and obviously the old moral suasion of the Bank of England ought not to be forgotten. One hopes that that is being applied now. The suggestions that there might be a higher repayment fraction and—although it had not occurred to me until it was mentioned by the noble Lord, Lord Brocket—the minimum age at which one might borrow are relevant. There are a number of things that can be done.
Another point which I mention en passant, and which I often ask about, is the ease with which the use of credit cards has expanded compared with cheque guarantee cards. A cheque guarantee card, after all, is cash. One is paying with what one has. In real terms the £50 cheque card has declined enormously in the period since it was introduced. Therefore most of us are encouraged not to use cheques—cash that is guaranteed—but to use credit cards. I should have thought that the minimum intervention which might be required would be to restore the cheque guarantee card to its original real level.
I say that mischievously because I know exactly why the banks have no desire to do so. Cheque cards
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are not very profitable for them and they have no desire to do something that might help those of us who think that paying cash is better. However, the fact that the banks do not believe it is profitable should not hinder the Bank of England from saying that that is what they have to do. That is what governments are for, and that is what the Bank of England is for.
Baroness Phillips: My Lords, I hope my noble friend will forgive me. The banks do not want to increase the limit because if a cheque guarantee card is stolen they would have to honour £100 instead of £50.
Lord Peston: My Lords, that is what the banks say; but the banks are in the business of making money and not of worrying about social security. I might add that if it was right 20 years ago to have the higher real level, why is it not right now? Incidentally, one can also buy insurance against the theft of cards. I do not accept that argument at all. The answer is quite different, and it is the one that I gave.
I should like to say something about loan sharks, and add my support to those who have spoken on that subject. That criminal and evil activity is quite sickening. I simply do not understand this Government, which frequently intervenes in other areas of criminal activity, not intervening in this one. Why not this one? Why not give priority to this one? I should certainly like to see something much more reassuring on that point. However, I do not wish excessively to prolong this debate. As your Lordships will be aware from my interventions and indeed from the notes that they see in my hand, I too could say much more. I have certainly found the debate immensely interesting. However, I must end on one further pessimistic note. As an economist, it would be wrong for me not to do so.
The real point is that in the end the consumer boom although stimulated by credit, is predicated on the anticipation of higher and rising incomes and higher and rising wealth. In a sense one is saying, "Though borrowing at these ridiculous rates of interest, I shall subsequently have the income to finance that borrowing". The point is that in the way the economy works it introduces a stronger note of instability into the system because the moment that incomes are expected not to rise as rapidly and do not do so the major problem occurs of financing the existing debt. Incidentally, in terms of stimulus of demand in the economy a major problem emerges of the demand for goods and services falling and further precipitating a recession.
Having produced the boom, it is very difficult for us easily to come out of it. I simply warn noble Lords, without saying definitely, that we shall come out of this state of affairs with a crash. There are certainly dangers. The lending will be a good deal less comfortable and bumpier than would have been the case had we not let the expansion get out of hand in the first place. I repeat my thanks to my noble friend and say again how much I look forward to the Minister's answers.
5.12 p.m.
Lord Strathclyde: My Lords, I am grateful to the noble Baroness, Lady Ewart-Biggs, for raising this important matter today. We have had a most useful, wide-ranging and genuinely interesting debate on her Motion. If falls to me now to speak on behalf of Her Majesty's Government. I am sorry that in her opening remarks the noble Baroness said that she was disappointed not to see my noble friend the Secretary of State in his place. He is detained elsewhere. I hope she will not mind too much that I am here representing him today.
It appears that noble Lords have concentrated mainly on two different but related aspects of credit; namely, the level of credit in the economy as a whole and what is seen as its effect, and the problems of debt experienced by some borrowers. Perhaps I may most usefully begin by putting one or two things into perspective. The Government are fully aware of the current concern about the overall level of consumer debt—a concern which has been expressed so eloquently by a number of noble Lords this afternoon. Moreover, we appreciate the difficulties and anxieties which can be experienced by some individuals and families through over-indebtedness. I would not seek to underestimate that in any way. But in the national context I agree with many noble Lords, and with the right reverend Prelate, that the scale of the problem should not be overstated and that it should be put into perspective.
Let me deal first with the wider question of the amount of credit in the economy and with suggestions that there should be some form of credit control. As noble Lords no doubt will be aware, 80 per cent.—that figure has been mentioned throughout this debate—of borrowing by households is on mortgages. So credit control that applied only to the 15 per cent. of personal debt accounted for by consumer credit would just not work; and restrictions on mortgage lending would be neither fair nor necessarily effective.
Lord Diamond: My Lords, perhaps the noble Lord will forgive me for interrupting him, but he must make clear to the House that half of that mortgage interest leaks out into the consumption economy through some means or other.
Lord Strathclyde: My Lords, I am not sure from where the noble Lord has obtained his figure of half the mortgage spending. No doubt he has a source. As to the general part of his question, the proportion is far lower than the 50 per cent. he mentioned.
However, I should like to continue. It has been suggested, for instance, that mortgage lending could be limited to a maximum proportion of the purchase price. Such a control would be unfair, hitting first-time borrowers hardest. And those who had already had a mortgage for some time would probably have plenty of headroom to borrow more. But, as I have already said, it would also be ineffective because, especially in today's sophisticated financial markets, anyone who wished to do so could top up their mortgage loans from other sources, including,
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in the absence of exchange controls, overseas brokers and bank branches.
As other forms of consumer credit represent only 15 per cent. of personal debt, imposing restrictions on it would have a proportionately small effect, even if it worked perfectly. But the fact is that it would not work anything like perfectly. The old minimum deposit and terms controls on hire-purchase were becoming increasingly ineffective by the time they were abolished in 1982. Today, much less credit is linked to a particular transaction and, even where it is, any required deposit can easily be raised by borrowing elsewhere; for instance, on credit cards or an overdraft.
The general point about direct controls on lending is that they create inefficiencies and distortions in the market, and these act to the disadvantage of borrowers and lenders alike. They give unregulated (and often less reputable) lenders a competitive advantage and they mean that less well-placed borrowers are driven to more expensive sources of credit. The only effective mechanism for influencing the availability of credit is the price mechanism, which in this context means interest rates. That was mentioned by a number of noble Lords. I shall come to that point later.
Lord Ezra: My Lords, perhaps I may intervene. So far there is no evidence that that is working. How long does it have to take? I refer to a note in The Times yesterday showing that shop sales are at record levels. Every month we see that shops sales are at record levels. When is this measure going to bite?
Lord Strathclyde: My Lords as I said before I sat down I shall come later to the subject of interest rates. As for the specific question asked by the noble Lord, obviously we do not expect a downturn to occur immediately. It will take time. However, there is evidence to show that house prices have been slowing down considerably, which is a sign that other forms of spending will change dramatically in the future as well.
The noble Baroness, Lady Ewart-Biggs, asked some questions in particular about the borrowings and savings ratio. I feel that the noble Baroness gave a rather biased picture, as did the noble Lord, Lord Graham of Edmonton. It is necessary to consider all personal sector financial assets and liabilities. At the moment personal sector financial assets are three times greater than liabilities. They have grown by a total of £447 billion more than liabilities since 1979 despite the fall in the equity markets in late 1987.
I am not suggesting that lending to consumers is or should be unregulated. The fact is that in the Consumer Credit Act 1974 we already have comprehensive legislation which is in advance of that available in any European country. Perhaps it would be useful for me to remind your Lordships of the protection that consumers already have when borrowing money or using credit.
Before I do so I should like to reply to the noble Baroness, Lady Lockwood, who mentioned money management and the role of advertising. I am very pleased to hear that the Advertising Standards

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Authority is paying special attention to loan adverts. The proposals of the Department of Trade and Industry to require clear information about secured loans in advertisements recognise the urgency to make regulations. Indeed, revised regulations will be made as early as possible in 1989. The Consumer Credit Act ensures that consumers have full information. The noble Baroness, Lady Phillips, has mentioned this. The information must be made available to them before they enter into a commitment.
The measure provides a number of safeguards against unfair practices by lenders. It requires that the main terms of any agreement, including the annual percentage rate of charge (APR), must be set out clearly and unambiguously. Many noble Lords have criticised the APR but I believe that it is a very useful device to enable consumers to compare one form of lending with another. The legislation imposes controls on advertisements to ensure that they are not misleading, and it gives consumers the right to a cooling-off period when they sign agreements at home.
The noble Baroness, Lady Ewart-Biggs, asked why controls should not be put on lending. However, the Government feel that these are wrong in principle and ineffective in practice. In financial markets, as elsewhere, the best way to improve performance is by deregulation and the removal of artificial controls. With the increasing sophistication of the financial sector and the absence of exchange controls, such measures could not be made to work effectively.
Lord Graham of Edmonton: My Lords, the noble Lord referred to the APR being a handy reference point for consumers. Will the Minister say how the interest-free period within the first year will affect the real APR? If consumers need to understand that, is it not a powerful argument for better education on the subject?
Lord Strathclyde: My Lords, the noble Lord, Lord Graham of Edmonton, may well be correct when he refers to further education on the subject. I am not sure how he suggests that that should be done. However, his suggestions on how this kind of communication can be improved would be gratefully received by the Government.
Lord Graham of Edmonton: My Lords, I made one in my speech; namely, the encouragement and extension of consumer advice centres. No doubt he will refer to that in his speech.
Lord Strathclyde: My Lords, citizens' advice centres are only one weapon to use. I shall be coming on to that.
The noble Baroness, Lady Ewart-Biggs, referred to the story in the Sunday Times, as did many other noble Lords. I think that it has been dealt with very capably by my noble friend Lord Jenkin of Roding. I agree with him that there has been a great deal of exaggeration in the press. Like the noble Lord, Lord Graham of Edmonton, I await the response in the paper next week.
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My noble friend Lord Rippon of Hexham spoke of alternatives to interest rates, saying that the increase in interest rates only increases inflation. But inflation as measured by the retail prices index, as we know, increases. I apologise, my Lords, I think that I am muddling my arguments. But the inflation rate increases following interest rate increases, since the United Kingdom, unlike most other countries, includes mortgages in the price index. I support my right honourable friend the Chancellor of the Exchequer in the belief that, in due course inflation will come down as a result of these measures.
Lord Rippon of Hexham: My Lords, I do not quite understand the reference to putting interest rates in the retail prices index. Whether or not they are put in the retail prices index, people who have their mortgage rate increased will ask for more money.
Lord Strathclyde: My Lords, I was making a general point that the retail prices index includes the mortgage rate. But I also take the point of my noble friend. Interest rates are an effective weapon against inflation and, in an advanced and mature market economy such as that of the United Kingdom, we believe that they are the only weapon.
Lord Brocket: My Lords, will the Minister explain why he says that they are the only weapon? Why cannot we use some form of credit controls? They have been used in the past. They have been proven to work. I cannot understand why the only weapon is interest rates.
Lord Strathclyde: My Lords, I do not know whether my noble friend Lord Brocket was listening a few moments ago. I said that controls on lending do not work because they are wrong in principle and ineffective in practice. We need to deregulate and to remove these artificial barriers. Consumers who are increasingly sophisticated will quite easily find their way around any artificial controls and barriers that we put up.
Lord Rippon of Hexham: My Lords, I am sorry to interrupt my noble friend yet again. However, will he give attention to the almost criminal rates of interest which are being charged in many cases? Are the Government prepared to control what is virtually criminal behaviour, or does he wish to deregulate crime as well as everything else?
Lord Strathclyde: My Lords, I do not know why my noble friend Lord Rippon states that these rates are necessarily criminal. I regard a high inflation rate as being genuinely criminal. We are trying to reduce the steadily but slowly rising rate of inflation by using the interest rate. We feel that in the long term high interest rates will be far less damaging than the resurgence of high inflation that we saw in preceding decades.
Lord Callaghan of Cardiff: My Lords, I am interested, because the noble Lord has twice stated that the introduction of the kind of proposals that the noble Lord, Lord Brocket, puts forward offends in

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principle. I often hear that argument from the Government. Would it be possible to explain which principle it offends? I have never been able to understand it.
Lord Strathclyde: My Lords, the Government have many principles. As regards the deregulation of financial controls, since the Government came into power they have always felt that the best way forward was to bring down as many of those artificial barriers as possible that had existed for many years before. That is what they have done and that is why they are committed to a policy of using interest rates as the main weapon against inflation.
My noble friend Lord Brocket stated in his argument that interest rates were a blunt instrument which hit industry in a particularly hard way. But interest rates are effective because they are comprehensive. The household sector is now, for the first time, a substantial net payer of interest. Therefore rises in interest rates are bound to have an effect on its overall spending.
It is also quite wrong to suggest that interest rates and a strong exchange rate are having a detrimental effect on industry. A 1 per cent. rise in interest rates, even if sustained for a full year, costs industry far less than a 1 per cent. increase in wages. As has already been pointed out, investment is booming. In the first nine months of 1988 it rose at an annual rate of 10 per cent. for manufacturing and over 15 per cent. for construction, distribution and financial services.
The noble Lord, Lord Peston, mentioned that the balance of payments deficit and the consumer boom were also due to easy availability of credit. But the current account deficit is due to a variety of factors, in particular a very buoyant growth of domestic demand. But it is quite wrong to think that all of this is due to consumption fuelled by credit itself. It is important to remember that investment is still very strong and this is the start of a genuine increase.
Perhaps at this moment I could return to the subject of current legislation dealing with credit. Comprehensive though it is, the Government recognise that there are one or two aspects which could benefit from being tightened. Several important changes are therefore being proposed.
First, in relation to secured loans, the Government accept that borrowers are in particular need of protection when staking their home as security. We are aware that the concept of a secured loan is not widely understood by borrowers. Terms such as "home owners only" in advertisements do not always sufficiently alert the borrower to what is at stake. The Government are therefore proposing that the regulations governing credit advertisements should be strengthened to require a clear warning in respect of secured loans that the borrower's home may be at risk in the event of failing to keep up the repayments on the loan.
There have also been problems in relation to brokers' fees. Some credit brokers have been charging consumers disgracefully high fees for arranging loans. In some cases the first that the borrower knew about it was when he received his loan minus the fee that had been deducted. The
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Government are therefore proposing that advertisements placed by credit brokers must state clearly whether a fee is to be charged, together with the amount of the fee and its method of calculation. It is proposed that in such cases the APR must be calculated so as to include the broker's fees.
The Government also propose to strengthen the provisions of the Act which deals with extortionate credit. The Act already allows the court to re-open a credit agreement which it considers to be extortionate. However, that can be done only at the request of the debtor. We accept: the fact that borrowers who enter into potentially extortionate credit arrangements are unlikely to be aware of their legal rights and are unlikely to be legally represented in any enforcement proceedings brought by the lender.
The noble Lord, Lord Meston, will be pleased to hear that the Government are proposing to amend the Act to allow a court to re-open an extortionate credit agreement, without being asked to do so. That would best ultimately be left to the court to decide on the facts of the case. What may be extortionate in one set of circumstances may not be so under another.
Finally, the Government are proposing to make some important changes to the consumer credit licensing system. The changes would enable the Director General of Fair Trading to take more effective and immediate action in those cases where a trader's activities pose a serious threat to the public. Under those proposals those engaged in lending money to the public would be more strictly controlled than they are now because their licences would come up for renewal every three years as against 15 years as at present. Although other categories of business would be relieved of the need to be licensed automatically, the director general would have additional powers to take action against any businesses in those categories whose activities presented a threat to the public.
The noble Baroness, Lady Ewart-Biggs, mentioned loan sharks, as did a number of noble Lords including my noble friend Lord Rippon of Hexham. We are currently reviewing credit licensing. We propose to increase protection for consumers by removing the £30 small loan limit. All lenders will therefore need to be licensed. However, the law as it stands regarding loan sharks is generally adequate.
It should be pointed out that unlicensed trading is a criminal offence punishable by imprisonment. Threatening behaviour or harassment should be reported to the police, although the Government accept that there may be problems in that area and that sometimes it may be difficult to enforce the law. Generally speaking, there is already an excellent working relationship between the Office of Fair Trading and local authority trading standards departments in the administration of the licensing system.
The existing consumer credit legislation and the proposals to tighten its effectiveness even further amply demonstrate the importance which the Government place on the adequate protection of credit users. However, the Government do not accept that there is anything intrinsically wrong or harmful

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in credit. Borrowing and saving are important economic activities and we should all be worse off if they did not happen. During their lifetime most people go through periods when they want to save and times when they need to borrow. The noble Lord, Lord Diamond, echoed Polonius in saying, "Neither a borrower nor a lender be". But people benefit from the existence of the free and efficient market in savings and loans.
I heartily agree with the view held by the noble Baroness, Lady Phillips, that there is a responsibility on borrowers. No one is forced to have credit cards. I commend her comments to my noble friend Lord Brocket concerning his staff. The Government are conscious of the useful work which is carried out by the Money Management Council of which the noble Baroness is president.
It is a fact that only a small minority of credit agreements give rise to difficulty. For instance, as my noble friend Lord Jenkin of Roding said, Barclaycard has recently estimated that less than 1 per cent. of its customers have a long-term repayment problem. That figure is currently falling. Against that background must be viewed the fact that borrowing on credit cards, which is often singled out as a particular cause of consumer debt, accounts for less than 5 per cent. of total consumer borrowing. Of that credit card debt, an increasing proportion of customers are now repaying their outstanding commitments in full every month. Barclaycard has stated over the past three years the number of their customers doing so has risen from 40 per cent. to 45 per cent. Those are matters for encouragement not for despair or alarm.
The noble Lord, Lord Diamond, said that we must save more and that we have too much borrowing. Recent increases in the interest rate are good news for savers in general. The Government recognise the importance of saving and have recently taken a number of steps to encourage that. For example, the Chancellor of the Exchequer recently announced a new National Savings product, a capital bond, to attract savings in particular.
The Government firmly believe that the ready availability of credit is a good thing provided that there are the kinds of safeguards for consumers that we have in this country. Nevertheless, despite such considerable safeguards it is inevitable that some people will get into difficulties. More often than not it is caused by events which happen after the consumer has taken out a loan, used the credit or mortgaged the house. Events such as redundancy, divorce, separation, injury, serious illness, death and so forth, can seldom be planned for but they can have a devastating effect on the income of a family or an individual. Such cases are not examples of irresponsible lending or reckless borrowing but pure and simple hard luck.
The noble Baroness, Lady Ewart-Biggs, and the noble Lord, Lord Graham of Edmonton, gave statistics from the Stoke-on-Trent CAB. We believe that it not particularly helpful to analyse the statistics of CAB clients in that way. After all, people would not go to CABs for money advice if they did not
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already have a debt problem. We do not see the significance of the figure of 59 per cent. owner occupiers in this context because, nationally, less than 0·6 per cent. of mortgages are over six months in arrears.
The Government are mindful of such cases, however, and they consider it important that people who get into serious difficulties of personal debt should be able to obtain good, independent advice and help with their problems. It is in everyone's interest that someone with multiple-debt problems should be helped to rehabilitate himself. The debt counselling services provided by CABs are extremely valuable in that respect. The Government not only value most highly the advice and help provided by CABs but they support the service in a real way. It is worth reminding noble Lords that the DTI finances the cost of the association in England and Scotland by a considerable amount. I have the figures on hand. I shall not state them here but they are considerably higher than they were in real terms. In England and Wales the contribution has increased by 165 per cent. and in Scotland it has increased by 232 per cent.
Before I finish it would be remiss of me not to mention the steps which are being taken by the credit industry itself to deal with some of the concerns which have been expressed by noble Lords today. Of course, lenders have a responsibility to adopt sensible lending policies. It cannot be in the lender's interest to lend to borrowers whose ability to repay is doubtful, and lenders are adapting their methods and introducing further safeguards to avoid over-lending. I hope that the noble Lord, Lord Meston, will find that fact encouraging.
Barclaycard rejected some 36 per cent. of applications in 1987. Most lenders now inquire about borrowers before offering credit. There are moves currently to broaden the scope of the information held by credit reference agencies to include details of individuals' current commitments. That would enable lenders to identify cases of multiple debt.
The Visa credit card issuers—
Noble Lords: Order, order!
The Deputy Speaker (The Earl of Listowel): My Lords, the time allotted for this debate has now elapsed. Does the noble Baroness wish to withdraw her Motion?
Baroness Ewart-Biggs: My Lords, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

British Shipbuilders
5.40 p.m.
Lord Strathclyde: My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Chancellor of the Duchy of Lancaster on British Shipbuilders. The Statement reads as follows:
"Mr. Speaker, with permission I wish to make a further statement about British Shipbuilders.

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"In my previous statement on 14th November, I was able to report good progress towards a successful sale of most of the remaining elements of BS, following that of Govan earlier in the year. That progress has continued. Agreement is now close for the sale of Clark Kincaid in Greenock, and of the Appledore yard in North Devon, and negotiations for the sale of the Ferguson yard at Port Glasgow are under way.
"I can additionally report today that I have accepted British Shipbuilders' advice that the preferred bidder for Marine Design Consultants should be the team led by the managing director. Depending on progress with new orders, their bid envisages work being continued both in their Sunderland and their Dundee offices. I have asked British Shipbuilders to press ahead with detailed negotiations.
"As I said on 14th November, the yards and other facilities I have mentioned account for five of the six owned by BS, and nearly two-thirds of those employed by them, when the process of seeking private sector purchasers was started by my predecessor last April.
"The remaining undertaking is of course North East Shipbuilders at Sunderland.
"On 14th November I told the House that, although none of the original bids for NESL had proved acceptable, BS had received three new expressions of interest. To allow time for these to be explored, I was therefore giving until the end of November to establish whether proposals could be developed which gave a firm basis for negotiation. This would entail a clear statement of the work envisaged for the yards, evidence of the technical and financial capacity of the bidder, and the prospect of arrangements likely to be compatible with the European Community Sixth Directive concerning state support for shipbuilding.
"In the event, two of those who had expressed interest prior to 14th November did not submit proposals. The third did so, and two other new proposals also came forward. All three have been carefully considered by British Shipbuilders and their independent financial advisers, against the criteria I set out.
"As a result of the examination, British Shipbuilders' clear advice to me is that none of these proposals could form the basis of a viable future for merchant shipbuilding in the Sunderland yards. None provides evidence of sufficient financial resources, given the major uncertainties of the shipbuilding market. None gives evidence of sufficient work for the future. All would entail levels of subsidy which, in one case in particular, could have faced difficulties under the Sixth Directive.
"Reluctantly and with great regret, I therefore have to tell the House that I see no further realistic prospect of maintaining NESL in its present form, and its shipbuilding yards will therefore progressively close as the current workload runs out. There remain possibilities, which I have asked BS to make every effort to explore, of selling
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Sunderland Forge Services, which currently employs nearly 400 people; and interest has also been expressed in one of the yards for purposes other than shipbuilding.
"Mr. Speaker, both my predecessor and I have made clear that, should it not prove possible for shipbuilding to continue on Wearside, we would bring forward a range of measures to assist those affected and to promote alternative employment in the town.
"There will be three main elements. First, we propose a new Enterprise Zone for Sunderland. As with existing zones, this would mean relief from rates for 10 years for all new developments, a simplified planning regime to help speed up such developments, and 100 per cent. capital allowances on new industrial and commercial development. My right honourable friend the Secretary of State for the Environment is urgently undertaking the necessary consultations with the European Commission, and will give details as soon as possible.
"Secondly, I have asked English Estates to start work immediately towards the early provision of over £7 million of advance factory space, over and above their existing commitments in the North-East. This will provide around 220,000 square feet of high quality factory space for new or expanding businesses.
"Thirdly, some £10 million will be made available over the next three years for a programme of measures to encourage new enterprise and employment opportunities in Sunderland. About half will be used to give financial support to new or expanding businesses. The other half will be used to assist the present employees of NESL to develop new skills and find new jobs. My right honourable friend the Secretary of State for Employment will provide services on the shipyard site to advise the workforce on opportunities for jobs and training, including help for those who wish to apply for immediate retraining.
"Taken together, the measures I have announced have a total cost of some £45 million. They will significantly reinforce what is already being done to promote economic development in the area through the Enterprise Initiative, regional assistance, and the work of the Tyne and Wear Urban Development Corporation, which will itself be announcing a number of new projects shortly as a result of the additional funding o ff 11 million for Sunderland announced on 25th November. I hope they will also further support and encourage the private sector initiatives which are under way or being considered.
"Mr. Speaker, the House will share my own regret that, despite every effort, it has not proved possible to find a way forward for NESL. But it must now be right to concentrate on securing a new industrial future for the town, and I believe we shall have the support of the House in what I have announced to that end."
5.47 p.m.
Lord Peston: My Lords, perhaps I may thank the noble Lord for repeating the Statement made in another place. I also understand that this is the first Statement which the noble Lord has read in your Lordships' House and therefore, as a matter of courtesy, I must congratulate him on that. Having said that, those are the only kind words I have to offer.
This is an extremely sad day for Sunderland and for the North-East in general. Perhaps I may ask the noble Lord whether he is aware that shipbuilding has carried on for 600 years on the Wear and that it has taken this Government to bring that to a close. Perhaps I may also ask the noble Lord whether he is aware, given the alleged concern of the Government for people in the North-East, that in that area some 60,000 jobs have been lost in the period that this Government have been in power. One wonders quite what is the nature of the Government's concern.
The Statement refers to enterprises that might have and did show an interest in taking over the shipyard. As I understand what has been said, eventually there were three possibilities; namely, one of the first three when two dropped out and then, as the noble Lord said, two new proposals. He says that they were considered against the criteria set out but they failed those criteria. I believe that the Government are obliged to say more than that simple statement that they did not meet the criteria. Perhaps the noble Lord could enlarge on the criteria employed and on the failure of the proposals to meet them. Perhaps he can explain what he means by:
"None provides evidence of sufficient financial resources, given the major uncertainties of the shipbuilding market".
What does that mean? What scale of financial resources did they fail to provide evidence of? Of course, the shipbuilding market is uncertain, but am I not right in suggesting that at the moment the uncertainty is in the upwards rather than the downwards direction?
The Statement says:
"None gives evidence of sufficient work for the future".
What kind of "evidence of sufficient work for the future" were the Government looking for? In particular the Statement refers to possible "levels of subsidy". Can we be told what those possible levels of subsidy were? Is there any particular significance to be attached to the word "could"? The Statement says:
"could have faced difficulties under the Sixth Directive."
The Statement does not say "would" have faced difficulties. Can we have elucidated for us whether the distinction between "could" and "would" is important? Am I not right in thinking that under the directive subsidy is certainly possible? Am I not also right in thinking that our partners in the EC find much more subtle ways of subsidising this and other sectors of their economies without running into these problems?
The Government referred to announcing measures at a total cost of £45 million. I asked about subsidies that might have been relevant. In that respect, how does the £45 million compare with the subsidy that
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might have been paid? How does that compare if we add to that £45 million all the unemployment benefit that no doubt will be paid out over a great many years?
The Government refer to a number of ad hoc measures that they are carrying out. However, one must ask why the Government do not plan these things. There are no problems in the North-East that are suddenly new. Why do we have the use of sticky plasters to deal with a major haemorrhage? Why do the Government lurch from one ad hoc intervention to another? Surely one could plan in such a way that one runs down the shipyard—if one has to run it down at all—exactly in line with the creation of new employment and new enterprise but no faster. That seems to me to be the minimal way to do it. Why have the Government not planned in that way?
Finally, the Statement ends with the extraordinary sentence:
"But it must now be right to concentrate on securing a new industrial future for the town".
I must ask the noble Lord this. If I were a worker of middle age in Sunderland what reason would I have for believing a word of what the Government say in that sentence? What have the Government done to suggest that the workers can have any confidence that the Government believe in the required interventions or would actually carry them out?
Lord Ezra: My Lords, I join with the noble Lord, Lord Peston, in expressing grave concern at the decision announced in the Statement and repeated in this House this afternoon. I put three specific points to the Minister.
First—and this links with what the noble Lord, Lord Peston, said—have the Government fully considered the full impact of this decision on Sunderland? There will be an immediate and direct loss of 2,400 jobs but I understand that 6,000 further jobs will be indirectly affected, with all that means to the families. The measures which the Government have enumerated will clearly take a long time to materialise. What will happen in the meantime while all that occurs? That is my first question.
Secondly, is not this closure taking place at the wrong time? There are now signs of a recovery in world shipping. It is known that the Sunderland yard is an advanced and modern yard. Why should we be closing a modern yard, strategically located, at a time when world shipping is picking up? That seems to me to be an extraordinary error in timing.
Thirdly, why is it assumed that recovery can take place only under private ownership? There have been impressive instances recently of a substantial recovery in publicly owned enterprises. I mention British Airways and British Steel, both of which were recently in the news. The chairman of British Seel has been awarded recognition as being one of the leading industrialists in the country. Until yesterday he was in public enterprise.
To sum up, therefore, I feel that this is a most unfortunate decision, the implications of which do not seem to have been fully worked out and the timing of which is wrong. I feel that those who work

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at NESL should be given an opportunity to take advantage of the recovery in world shipping.
Lord Strathclyde: My Lords, I am grateful for the words of the two noble Lords who have spoken. I have to say at the start that the Government take no pleasure in making this announcement about North-East Shipbuilders Limited. It is a great sadness after 600 years that the yards have to close, but I shall seek to justify that in the next few moments.
First, the noble Lord, Lord Peston, asked why we were closing the yards since there seemed to be an upward trend in orders. The answer is relatively simple. For years shipbuilders have been forecasting the next market peak and that it is always but a few years away. Each time those forecasts are revised downwards, pushing better days further and further away. Meanwhile, more low cost nations enter the scene. North-East Shipbuilders represents a mere fraction of world capacity and it is only significant—I say it is significant and important—in local towns, which is why we have to seek new options for the people who work in the area.
The noble Lord also asked about the Sixth Directive. Subsidies are allowed in supporting shipbuilding in European Community member states, but there are strict limits on how much subsidy can be provided. All member states, therefore, are similarly restricted and it did not appear that we, as a Government, would be able to subsidise the yards sufficiently for them to continue building ships.
As for the criteria concerning the bids from private industry, the proposals did not show evidence of a sufficient forward workload to fill the yards, nor of a sufficient financial ability to demonstrate that the yards could recover from their severe loss-making position. In the past year North-East Shipbuilders made a loss of £56 million on a turnover of only £69 million. Over the past five years it has been subsidised by the taxpayer to a total of over 50 per cent. for each contract carried out.
I was asked why the Government sought private ownership in the first place. British shipbuilders in general, and NESL in particular, have lost literally hundreds of millions of pounds—just over £1.9 billion over the past 10 years. That includes massive losses on contracts over and above the subsidy allowed. The Government felt that this could not go on for ever and that we had to look at new options not just for the taxpayer but also, genuinely, for the people of the North-East.
Reference was also made to the new packages we are to introduce in the North-East, and evidence was requested that they will actually work. That evidence is clear from similar packages introduced at the time of the steel closures. For example, Consett closed with a loss of 4,370 jobs, Corby with 6,000 jobs, Scunthorpe with 5,800 jobs and Shotton with 8,500 jobs, but the packages we introduced there have been very successful. In March 1986 unemployment in those areas stood at 17·6 per cent., 20·3 per cent., 17·5 per cent., and 19·5 per cent. respectively. Now they are down considerably, to between 8·7 per cent. and 13·1 per cent. That is what we want to do in
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Sunderland. I sincerely hope that we shall be successful. I trust that the noble Lords from across the House will join with me in hoping that these packages will help to regenerate the economy of the North-East.
6 p.m.
Lord Dormand of Easington: My Lords, is the Minister aware that this is an utterly disgraceful decision as regards Sunderland? This is a case of sheer dogma placing money before people. We on this side of the House are as concerned about economic efficiency as members of the Government and other noble Lords opposite. But there are instances where this does not apply. is he aware that unemployment for Sunderland is 27 per cent.? Does it not mean anything at all to the Government that a town like Sunderland is so affected? I live near Sunderland and have done so all my life, so I have some idea of the ethos of that town.
Can the Minister say something about the Cuban orders? What is significant is that nothing was said about them. The information that some of us have is that those orders were tied up and that they were ready to go. But we have had no reference or detail as regards that matter today. Do the Government not place any importance at all on the possible future recovery of the United Kingdom shipbuilding industry? My noble friend referred to this, as did the noble Lord, Lord Ezra. It seems that, despite the information we are getting from the Minister tonight, this is a matter that is probably more important than anything else to be said on the subject.
There is the question of alternative employment. The Government's record on this is a myth. The Minister referred to Shotton, Corby and three or four other instances, yet in this House we never get the actual figures. I can go a little further because I thought the Minister might refer to Consett in County Durham, which is near the county of Sunderland. Sunderland used to be in County Durham, as he may know. The steelworks in Consett were abolished as a result of this Government's actions, and we are constantly informed that those jobs are being replaced. I say to the Minister and to the Government that that is simply not true. It is not happening. Yet today we are presented on a plate with the measures as regards the enterprise zone which will make a minimum contribution to solving the problem that we have before us today. That and the other proposals will simply not meet the needs.
Finally I repeat the important point made both by my noble friend and by the noble Lord, Lord Ezra. Why cannot the Government have an interim period, perhaps for the Cuban orders, so that at the same time as alternative employment is increasing (if it does increase) the Sunderland shipyard may be gradually run down? I hope that these are practical and sensible suggestions and that the Government will have second thoughts.
Lord Strathclyde: My Lords, the noble Lord rightfully sounds annoyed at what has been going on in Sunderland. The government officials in the Department of Trade and Industry and the Chancellor of the Duchy of Lancaster have spent

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literally months trying to find ways to keep the shipyards open. The officials have travelled the world talking to different people and different bidders for potential orders to see whether any can find their way to the North-East. Unfortunately this has not been the case.
The noble Lord said that we were being dogmatic about this approach. Neither we nor the European Community could have tolerated British Shipbuilders' losses for much longer at NESL. As he knows well, the Danish ferry programme collapsed and there was strong reason to doubt that British Shipbuilders could have won the Cuban order, at least without further substantial losses. The North-East yards have lost more than £100 million in the past three years. Furthermore, as regards the Cuban order, the BS chairman doubts whether the order could have been secured against fierce international competition, especially given deteriorating costs over recent months.
In addition, there is still the corporation's appalling record of losses over and above the estimates to be considered. There was an average of more than 20 per cent. on costs over and above the European Commission limited assistance on ships delivered in the past three years and between 12 and 17 per cent. on costs for the ships most recently delivered to Cuba.
Finally, the noble Lord mentioned Consett. In my initial reply I mentioned Consett also but it was in percentage terms, which are sometimes difficult to grasp when they are said quickly. I point out to him that 4,500 new jobs have been created in Consett since the steel closure. That is a sign of what we can do in the rest of the North-East and it is also a sign that unemployment is going down right across the country.
Lord Elliott of Morpeth: My Lords, I suggest to the noble Lord, Lord Dormand, who shares with me a great interest in the North-East of England from which we both come, that the interim period for which he asks for northern shipbuilders is something that we have had. I assure my noble friend that to the best of my knowledge there is considerable appreciation in the region that everything possible has been done by all concerned, including the Government, to keep these yards open if humanly possible. It has been found impossible to do so. I believe that the decision now made is the right one and in the best interests of the people of that town.
There must come a moment when it is wrong to keep in being an industry which has no future. There must come a moment when it is wrong to continue to train young people in a town like Sunderland for an industry that has no future. I believe that that moment has come and that we must face facts. I heard on the radio this morning comment being made by workers in the shipyards as they were going to work. Quite a number were saying that it had to come and that at least a decision has been made. Thank goodness the decision has been made one way or the other. The period of indecision has been bad for the region.
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I suggest to my noble friend that the announcement today of the extra measures of support for Sunderland are most welcome, including the creation of a new enterprise zone. Those existing in the region are so successful and they have created much new employment. There is the suggestion that there should be new encouragement for enterprise and initiative, as there has been in other parts of the region. I very much agree with my noble friend about Consett, where unemployment after the closure of the steelworks there in September 1980 meant immediate unemployment for something like 14,000 people. The recovery of Consett is a minor miracle within our region. I am quite certain that with the right spirit on the part of Government and of those agencies set up to create new employment to assist such places as Sunderland to have a new future, and if it is engendered by government assistance, it will mean that Sunderland too has a considerable future. I certainly wish it well.
Lord Strathclyde: My Lords, I am genuinely grateful for the intervention of my noble friend. He is absolutely correct in saying that everybody who has been concerned with the issue of the North-East has worked extremely hard to get a satisfactory result from the closure of this yard. The Member of Parliament for Sunderland, North, Mr. Bob Clay, has tried particularly hard to see what could be done. Ultimately we feel that there comes a point when it is no longer credible to go on trying. We owe it to the people of Sunderland to end the uncertainty that has plagued their lives for far too long and now to offer the town a new future. The town is not short of committed business people willing to do their utmost and to make it work. I have been assured of the role that they are prepared to play. The opportunities will be there if people wish to take them and we shall be doing our utmost to make sure that the money and infrastructure are available to help to create those new jobs.
Lord Glenamara: My Lords, is the noble Lord aware that if the Government decided to pull down Westminster Abbey the noble Lord, Lord Elliott of Morpeth, would stand in the middle of Parliament Square saying, "Trust Mrs. Thatcher; this is for the good of the country"? Is he aware that most of us from the North-East are shocked, appalled and disgusted by the Government's decision to disperse for ever this magnificent labour force which is well known to many of us, as I am sure it is to the right reverend Prelate who was a dedicated curate in Sunderland.
The noble Lord has not told us the size of the problem. The noble Lord, Lord Ezra, has told us. It involves not only the 4,500 men who work in the shipyard but all the people who depend on it. This amounts to more than 10,000 people. The noble Lord, Lord Dormand, has told us that unemployment in Sunderland is currently 27 per cent. What will happen when these 10,000 people go on to the dole? The figure will not be 27 per cent. It will be 30 per cent., 37 per cent. and 40 per cent. for male unemployment. Is the noble Lord just shaking his head or is he tired? Unemployment will rise to about 40 per cent. That is quite appalling.

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The noble Lord has said that the shipyard is uneconomic. Will he tell me where there is a farm anywhere between John O'Groats and Land's End that is economic? Will the noble Lord tell me of one? There is not one. In the case of farming we do not refer to losses. We subsidise farming and rightly so. I agree with that. However, if we can subsidise every farmer in the country, why cannot we subsidise the shipyard workers in Sunderland?
The dispersal after 600 years of shipbuilding in this northern city is a tragedy. The Government ought to be thoroughly ashamed of themselves.
Lord Strathclyde: My Lords, the noble Lord says that he is shocked and disgusted by the way in which the Government have behaved. I have to remind him that £1.9 billion of taxpayers' money has gone in support of British Shipbuilders since 1979.
Lord Glenamara: How much has gone in support of British farmers?
Lord Strathclyde: My Lords, British farming is an entirely different issue. The noble Lord is quite entitled to have a separate debate on that subject. Today we are discussing North-East shipbuilding and British Shipbuilders as a whole. Enormous funds have been poured into them over the years.
Lord Glenamara: And into farming.
Lord Strathclyde: My Lords, we have explored every single avenue available to us. We have considered 13 approaches and extended the deadline twice but none can offer a secure future for NESL. That is the reality of the situation. Furthermore, as to the figures mentioned by the noble Lord concerning unemployment, they exaggerate the dependence of outside jobs on the yard. They take a wholly unjustified view of the prospects for new employment in the town. They greatly exaggerate what is needed to revitalise the economy of Sunderland. I need not go on.
We do not believe that the closure will blight the area. On the contrary, it is an opportunity to create new direction in the local economy, not a dying area which it has been in recent times—
Lord Glenamara: Rubbish!
Lord Strathclyde: We should see, for example, the recently announced major investments by Gold Star, the South Korean electronics company. It is hoped to create up to 1,000 jobs for an £8 million capital investment in the region. That is the direction to go in and I sincerely hope that it will be successful.
6.15 p.m.
Lord Greenway: My Lords, if the present trend continues we shall shortly find ourselves without a merchant shipbuilding capability. Is there not a strategic reason for keeping some of the yards in being, if only in a mothballed state, so that if ever the time came when we needed to build ships in a hurry
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we had somewhere to build them? One cannot produce a shipyard out of a hat.
Lord Strathclyde: My Lords, in reply to that point I have to say that I have never heard of ships being built in a hurry in any case. It always takes a long time. I cannot believe that the situation would arise in the future whereby we had to do exactly that and build them in a hurry.
Lord Peston: My Lords, I am sorry to intervene a second time but I asked a question of fact in my original intervention. I asked the noble Lord to give us all the relevant figures so that we could compare the costs of closing down the shipyard with the costs of keeping it going. He made a number of qualitative statements and a number of other statements with no evidence. I asked for information which would be enormously helpful to your Lordships. If the noble Lord does not have the information, I am willing to accept it subsequently. Central to this whole discussion are answers to my first questions.
Lord Strathclyde: My Lords, I do not appear to have that information at hand at the moment. I am not sure which figures the noble Lord wants. If he wants to know how the Government calculated that it would be cheaper to close the yards than to keep them open, the answer is that the disposal to any of the new parties would have cost British Shipbuilders more than closing the yards. The advice that the Chancellor has received is that none of the bids offers a commercially viable basis on which to negotiate a future for NESL. The question of quantities should be taken into account but does not necessarily arise. I suspect that the noble Lord wants hard figures.
Lord Peston: My Lords, if I may dare to interrupt the noble Lord a third time, which I do not care to do, I should like the numbers. I should like to know whether it is cheaper to close the yards down than to keep them in public ownership, with I agree a degree of subsidy. If we are to discuss this sensibly we have to look at the figures. We cannot go ahead with broad remarks like, "It was not viable". That is a meaningless statement. If the noble Lord does not have the figures I shall have to have them later. However, they are central to the issue.
Lord Strathclyde: My Lords, cost comparisons are irrelevant in themselves until one has a bid that might offer a viable future for the yards. We know the criteria we have used to define viability.
Lord Williams of Elvel: My Lords, the noble Lord has not understood my noble friend's question. It is not the comparison between the close-down costs or the sale costs; it is the comparison between the cost of keeping the yard going and the cost of the Government's programme.
Lord Strathclyde: My Lords, if I misunderstood the noble Lord, Lord Peston, 1 am sorry. I do not have the figures at hand. However, the package announced today is designed for the longest term. We have felt for a while now that the shipbuilding yards will not be viable forever.
Lord Blease: My Lords, I want to conform with the conventions of the House on Statements of this kind and so I shall put my points quickly. Concern has been expressed about the unemployment that will arise in shipbuilding in the North-East. That is a tragedy. However, the question is much wider. The Government's policy has allowed shipyard after shipyard to drift on to the rocks. It has allowed more than that. The Government are sinking them before they have had an opportunity to be saved. I cannot see how they can separate the shipbuilding industry of the United Kingdom, an island community, from the shipping industry.
The industry has experienced a complete decline. We are allowing other nations to build ships for us. The Government have no policy either for shipping or for shipbuilding. This is a wide issue. If we do not have shipping interests, we will not have shipbuilding. The Government should have a rolling programme of taxation to allow shipping interests to be promoted in the United Kingdom instead of allowing them to be taken over by other interests from Greece and Japan.
I should like to put it to the Minister, in view of the fact that this shipyard has been closed down, that other shipyards are closing and losing their link with shipping. Will he convey to his right honourable friend the Minister that two parliamentary Select Committees, representing all parties in this Parliament, have gone on record and expressed deep concern about shipping and shipbuilding? Further, will he ask him to initiate or commission an independent study of the needs of shipping and shipbuilding in the United Kingdom?
Lord Strathclyde: My Lords, I shall certainly pass on the noble Lord's suggestion to my right honourable friend the Chancellor of the Duchy of Lancaster. However, I must point out to him that as regards the link between shipping and shipbuilding, NESL has built very few, if any, ships for UK owners in recent years. Therefore it appears that there is currently no great link between the two in the North-East.
Further, it has been suggested that there has been some kind of conspiracy to wipe out merchant shipbuilding in this country. Nothing could be further from the truth. We would have been delighted to have made a different announcement this afternoon. After all, we were able to sell Govan to private industry. I hope that that example will be followed by other facilities.
There is also the shipbuilding industry in Northern Ireland, about which a question remains. We have successfully privatised many yards and this shows—indeed, I hope it proves—that the Government have no intention of letting British shipbuilding drift on to the rocks.

Business
Viscount Davidson: My Lords, I should like to make a further statement about the arrangements for the debate which is now to follow on mental illness.
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The name of the noble Lord, Lord Taylor of Gryfe, has been inadvertently left off the speakers' list. The noble Lord proposes to speak in the gap and the maximum time for each speaker is accordingly reduced from 11 to 10 minutes.

Mentally Ill and Handicapped
6.22 p.m.
Lord Carter Lord Carter rose to call attention to the level of assistance available to people with mental illness or mental handicap moved from residential care into the community; and to move for Papers.
The noble Lord said: My Lords, the debate which we are about to have concerns one of the most poignant problems in a modern society: the fact that a large number of our fellow citizens—I use the word "citizens" advisedly, because citizens have rights—do not have the same rights and level of comfort and care as the rest of society. I refer to people who are suffering from mental illness or mental handicap moving from hospital into community care—or, as some would argue, community neglect.
As the Griffiths Report on community care published in February of this year pointed out:
"At the centre, community care has been talked of for 30 years and in few areas can the gap between political rhetoric and reality on the one hand, or between policy and reality in the field on the other hand have been so great".
There is certainly no lack of evidence, reports and proposals for action in the field. The Social Services Committee in another place, reporting in 1985, pointed out that while there is,
"a general recognition that the days of the largest hospitals are over, there is no consensus about community care".
That report produced no fewer than 101 recommendations for action. The Audit Commission reported in 1986. It recommended a proper division of resources and responsibility between central government, local authorities, the private sector and the voluntary sector.
Finally, as I said, we have the Griffiths report issued in February this year. It produced a range of proposals for the organisation of community care. The response from the Government has been a deafening silence. Meanwhile long-stay hospitals are being run down or closed before proper community services are available. That has resulted in some patients experiencing a worse quality of life than they had in hospital.
There is a confusing and conflicting overlap of responsibilities and provisions involving the hospital service, the health authorities, the voluntary sector, the private sector, the central departments of government and the social service departments of local authorities. In such a situation there is bound to be a misuse of resources.
There appears to be a grave mismatch of resources to need: some 90 per cent. of the expenditure on mental health services is in the hospital services and 10 per cent. on community care. However, the demand is almost exactly the other way round; namely 90 per cent. of those requiring help are in the community, while 10 per cent. are in hospital.
For each of the psychiatric nurses working in the community there are about 25 working in hospitals. In a large mental hospital that I know of in Wiltshire, there is a nurse-patient ratio of almost one to one; there are 350 nurses for 500 patients. In the same area there are 22 psychiatric nurses in the community with a caseload of 30 to 40 patients each.
On the very important question of the closure of hospital beds, there is a deal of confusion over the number of mental health beds which have been closed, and are to be closed, and there are conflicting figures from different sources. The estimates for closures during the last 10 years range from 25,000 to 40,000 beds. I hope that when the Minister responds to the debate he can provide the most up-to-date figures from the Government for the actual number of closures over the last 10 years and for the planned closures in, say, the next five years.
However, whatever the figures for closures are, compared with the closure of the tens of thousands of hospital beds, what is clear is that only some 9,000 of day care places have been provided in the past 10 years. The problem is bedevilled by the not unusual situation of different departments of central government pulling in different directions.
The Department of Health has responsibility for encouraging and promoting the provision of care in the community. At the same time, the Department of the Environment ratecaps the local authorities which increase their expenditure on community care, while the Department of Social Security, through its system of board and lodging payments, tends to guide people towards a form of semi-institutional care in residential homes and yet at the same time administers the new Social Security Act which in some cases has resulted in substantial loss of benefit for former patients.
On the question of board and lodging payments, there is concern about the proposal from the Department of Social Security to transfer the residents who are in the voluntary sector hostels from the system of board and lodging payments on to housing benefit. It has been argued that such a change will undermine the finances of existing schemes and that many of them will be forced to close.
The schemes have been specifically developed by housing associations and voluntary agencies as a part of the Government's initiative in community care. The opportunities for people to move into the community could be seriously reduced and, indeed, it is possible that many would have to stay for an unnecessarily long time in residential institutions at an increased cost to the Exchequer. Although I welcome the recent announcement of Mr. Nicholas Scott, the Minister for Social Security, that he has deferred the proposed change beyond April of next year, there is still considerable concern that the department intends to go ahead with the change much later in the year.
Housing is an area where the problem is most acute. I think that we would all agree that every citizen has the right to a decent roof over his or her head. However, it is clear that substantial numbers of
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former hospital patients are ending up in unsuitable temporary accommodation, in hostels and in night shelters or are indeed homeless.
The Salvation Army estimates that up to three-quarters of the male inmates of its hostels may be suffering from mental illness. The St. Mungo Housing Association notes that the number of former and long-term psychiatric patients resident in its hostels has increased from 10 per cent. to nearly 50 per cent. Emanuel House in Nottingham, which is a large hostel for the homeless, has seen a substantial increase in the number of former patients from mental health hospitals who are seeking hostel accommodation.
In a recent article in the Guardian there were heartbreaking stories of former hospital patients who were literally starving and who were somehow getting themselves back to hospital, the only haven that they knew. This is just one case of many: Robert cannot think straight, let alone manage to budget on the pitiful £25 a week that he collects from social security benefits. Halfway through the week he has run out of money and is begging for food. The hospital sister has been doling out her own money to desperate outpatients. She says they tell her that they have no money left. It is found that they have not eaten for days.
Only yesterday I had a discussion with a social worker in South London, who described two of the many cases with which he had to deal. One concerns a man of 62, who is leaving hospital after 33 years. He has few skills to enable him to look after himself outside. He is very frightened of the outside world and is desperately insecure. The other case is that of a woman of 40 sufferering from severe brain damage as a result of meningitis. She has an attention span of only half an hour. Her child is in care. She has no idea of how to manage money. She relies on charity to augment her benefits of £40 a week. These are examples of two people who are utterly reliant on a good system of community care.
There is an inner city problem overlaying the other problems that I have described. I referred earlier to the mental hospital near my home in Wiltshire. This has been halved in size over the last 20 years from 1,000 to 500 patients. I discussed the situation with a senior member of the staff in preparation for this debate. He said that there are problems, although possibly fewer than in the cities and conurbations. The hospital serves a rural area which has no town with a population larger than 10,000 to 12,000 people. In that context community care gets a chance to work. The pressures on the patients, hospital and community are much less than in the inner cities.
It is not possible to do more than outline the problem in the time available. I know that other speakers will wish to cover certain aspects in more detail concerning homelessness and employment.
We must remember that this problem will grow. It is estimated that by 2000—only 12 years away—the number of people over the age of 75 will increase by 250,000. If that is so, and in the absence of the finding of a cure, each social service department may have to cope with an extra 600 people with senile dementia.
I am deliberately taking less than the time available to me to give more time to other speakers. There are two under-funded systems dealing with mental health, one in the hospital service and one in the community. The Government must produce their response to Griffiths. Any further delay will be scandalous. That response should include plans to ensure that the rundown or closure of hospitals must not take place without detailed plans for the care of each person to be discharged. New funds must be made available for allocation to community care. The health authorities and local authorities cannot be left to juggle their existing funds to buy community care. There must be some form of transitional bridging finance as hospitals run down and community care builds up. Proper information must be available so that we know what happens to patients when they leave hospital. The Audit Commission, reporting in 1986, pointed out that 37,000 patients had left hospital in the previous 10 years, but nobody knew what had happened to the great majority of those discharged.
In New York it is estimated that 30,000 former psychiatric patients are living on the streets. The Government have a direct responsibility to see that that does not happen here. The first signs that this is happening are already apparent. There is a clear responsibility on Government to provide the leadership and resources that the situation demands and to cut to the heart of the problem and help to solve it. My Lords, I beg to move for Papers.
6.35 p.m.
The Earl of Balfour: My Lords, I am grateful to the noble Lord, Lord Carter, for having initiated the debate. I honestly admit that I did not expect to follow him in the debate. All that I wish to do is to raise one or two of the difficulties involved in looking after those who are of low mental intelligence or mental ability.
One of the troubles in bringing into the community a person who may have been wonderful a few years ago but who is now mentally away with the fairies is that such people cease to think logically. The disastrous effect of their ceasing to think logically is that they distrust nearest and dearest. From that moment on, nearest and dearest have little chance of helping.
Another aspect of bringing such people into the community is that they often have a tremendous fear of being left alone, particularly in the evening when it is dark. In NHS hospitals I have discovered that they are put into wards; they may be screened off so that they cannot see each other but, if one of them falls out of bed, at least the others can ring a bell and say "Old Mrs. So-and-so has fallen out of bed". Although they may be mentally away with the fairies, they all have an inbuilt will to live.
There is also a strong need for regularity of life and care. This care needs to continue in the wee small hours between dinner time and breakfast, almost as much as at any other time of the day. When mentally deficient people are brought into the community, it is almost impossible to give them the regular, institutional type of life of hospital where breakfast,
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lunch, tea, dinner and bedtime are at set times. Perhaps I may personally say—I have a vested interest: my wife is in a home—thank God for the National Health Service!
There is another unfortunate aspect that affects those people who are mentally cracking up. Although the science of psychiatry has developed tremendously in the past 20 to 30 years in regard to people who are in the process of going round the bend, for want of a better phrase, another problem is that few psychiatrists under the age of 45 really know what questions to ask. I say this without any criticism of their work. It is purely and simply that they have not seen enough of life to know the right questions to ask. If a psychiatrist could be with the patient for, say, two to two and a half hours—in practice, of course, that is far too long a period—he or she would realise that there is something definitely wrong. Many people who are cracking up mentally play the same gramophone record again and again. It is not until they reach the end of that gramophone record and start to play it all over again, that you realise that they are absolutely away.
Equally, with doctors and gynaecologists and such people we are rapidly developing in science. People can be seriously affected by drink or drugs, but if they can receive effective treatment in hospital early enough they often can be put back into society and live as perfectly normal people. Women tend to suffer from this a little earlier than men, but equally a number of men I have known—and no doubt your Lordships have too—have suddenly gone berserk and have wanted young things of 16 or 18 years of age around them when they have reached 50. That is purely and simply because they are going through the change of life. A man can go through a worse change of life than a woman. If only they could see a good doctor, they can have hormone injections which will put them back on the right tracks again.
Lastly, we are concerned for people being in the community. In the proper mental hospitals the doctors may take advantage of the Mental Health Acts if somebody walks out and may slap on a three-day order to bring them back into hospital again. In any other walk of life, including that in ordinary hospitals, any patient has the absolute right to discharge himself. Where people are mentally away this is a danger to them and perhaps to other people.
My last appeal—and I have been speaking for rather a long time—is to the social security services. While they do a wonderful job, I beg of them not to be quite so secretive. When I, as a Member of the House of Lords, or when district or county councillors ask if those services can help they could not be more courteous or more polite, and they say "You just leave it to us. We will deal with it all." They refuse to take advice. I admire the social work dealt with by local authorities, but I ask the DHSS to accept advice from people when it is given from genuine feelings. These are a few thoughts. I have said enough.
6.43 p.m.
Lord Winstanley: My Lords, nobody could overemphasise the importance of this subject, nor could we sufficiently underline the topicality of the

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debate, and I am most grateful to the noble Lord, Lord Carter, for initiating it. I am also grateful to the noble Lord for sitting through and listening most attentively to a short debate on Thursday last on an Unstarred Question into a specific case, that of Sharon Campbell. It is quite clear that that debate has borne fruit on this side of the House. I await with hope to learn that it has done so on the Government Benches as well.
None of us could deal with the Griffiths report, which is a large document, in a 10-minute speech. I shall not attempt to do so. It is the implementation of Sir Roy's proposals, or of other things in their place, that we are debating. We know that some of his proposals are not all that acceptable. I referred to one the other day. Sir Roy Griffiths believes that community care should be vested in the hands of local government. With the Government's present attitude towards local government it seems to me to be highly unlikely that that prescription will be dispensed. But we must have some other prescription if we are not to have that. Somebody must take responsibility for community care.
The chief medical officer, Sir Donald Acheson, in a magazine called Health Trends in 1985 begged for clarification of the term "community care". He said that it had developed too many meanings and had acquired "an ethos of virtue" without any certainty of what it meant. What does it mean? Can a hospital be part of the community? Does it mean care in or by the community?
I have discovered the DHSS definition written in a document. It is:
"the provision of alternatives to long-term institutional care".
In 1984 the noble Lord, Lord Trefgarne, speaking for the Government on that occasion, put the policy aim more simply as:
"to move out of hospital those people who do not really need to be there".
As a doctor and as a Member of your Lordships' House I fully support that stated aim, but I say without hesitation that it cannot be achieved without satisfying the DHSS definition of community care too. I have just quoted that definition and I repeat it:
"the provision of alternatives to long term institutional care".
the trouble is that in many areas the alternatives are not there. I fear that some of those which are present may soon disappear.
I have been much disturbed by a letter which I received from a body called the Special Needs Housing Forum, which I am sure has been sent to other noble Lords. It says with regard to existing community services:
"This threat arose when someone in the Department of Social Security decided to *do something' about the 25,000 people who stay in these special needs hostels.
Instead of allowing them to go on receiving Board and Lodging payments plus a small personal allowance, they would be switched to Housing Benefit and Income Support.
This would cut their weekly income drastically and mean that hostels couldn't afford to go on providing a service.
It could cut half the available hostel places at a stroke. And even now, demand for such places far outstrips supply".
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It is not just hostels or even day care centres which we need, and we need them desperately if the policy is to succeed. We need financial support for those individuals and for their families. We need proper financial support for the families who have to care for mentally handicapped children or for mentally ill adults who are discharged into the community. In addition they require human support—social workers.
I was deeply impressed by a speech in your Lordships' House yesterday by the noble Baroness, Lady Faithfull, about the need for improved training of social workers, particularly when they have to deal with such very complex cases. Handling schizophrenic patients is an extremely complex business. We all remember the old days when there was a change from the so-called generic social workers. The specialised social workers all became generic social workers. In other words they all had to do everything. Yet the length of the social worker's training remained at two years. There is clearly, as the noble Baroness, Lady Faithfull, illustrated admirably yesterday, a need for improved training of social workers. I am certain that that is a prerequisite to any success for the Government's policy of closing some of the large institutions and discharging those patients into the community.
The future of community care as a concept or as a reality does not depend only on the Government—though it depends to a considerable degree on the Government. It depends on us all. It depends on many voluntary bodies which do splendid work and continue to do that work in this field. We are all aware of such bodies and many noble Lords do some of that work themselves. MIND is one such body doing splendid work particularly in relation to the Mental Health Act and the Mental Health (Amendment)Act. MENCAP does admirable work for the mentally handicapped and the Schizophrenia Fellowship focuses on a different area and on patients of a somewhat different kind. The noble Earl, Lord Balfour, in his most enlightened speech was dealing much more with the problem of looking after the mentally handicapped. But the problems of looking after the mentally disturbed or schizophrenic patients are quite different.
Perhaps I may be philosophical for a moment. I think that other noble Lords as well as myself may remember the words of Sir Isaiah Berlin a long time ago when he very perceptively differentiated between two kinds of freedom. He talked about negative freedom (freedom from) and posii:ive freedom (freedom to). I should not dream of criticising any of the voluntary bodies which I have just mentioned but, if I may say so with all possible respect to the workers in MIND, with whom I have worked very closely on the Mental Health (Amendment) Act, I believe they have tended to exert most of their influence on the freedoms from, which are very properly the patients' rights. They are paramount and we must consider them: freedom from incarceration in hospital, freedom from compulsory treatment and similar freedoms. But perhaps the voluntary bodies did not give quite enough thought to freedom to.

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In the tragic case that we discussed on Thursday we had an example of a schizophrenic patient being discharged into the community from an institution. She was given freedom to express her distress and hostility in any way she chose and she chose a way which had tragic consequences for a social worker.
We must think about these things on both sides. I know that much thought will be given to the mental handicap side of the issue. I should prefer to move for a moment to the other side about which I know a little more. I hope that this policy of community care succeeds, let me be quite clear on that. However, in order for it to succeed we must think about the other side of the equation as well. By all means include the rights of the patients, they are paramount and must be protected at all times. Nevertheless we cannot ignore the impact on communities or on families of the discharge into the community of mentally disturbed patients and in particular patients suffering from schizophrenia. They have a tendency, as part of their disease, to stop taking the treatment once they feel better, with serious effects. Having been discharged, they stop having their treatment and then their condition deteriorates and they can become a danger to themselves and to other people.
In conclusion I must say that it is a laudable aim to see that patients who do not require to be in hospital should not be in hospital. That is in jeopardy because the steps are not being taken to make absolutely certain that communities are safeguarded and that patients are safeguarded as well. Unless those steps are taken by the Government, by local government or by anybody else soon and effectively, we shall see movements and campaigns in the other direction. There will be movements from the community to suggest that we rebuild some of the large institutions and lock people away again in the manner in which we used to. That would be tragic and would be deeply regretted, but if it happens, the responsibility will lie at the door of the Government, who have failed to implement the recommendations of the Griffiths report.
6.53 p.m.
The Lord Bishop of Southwark: My Lords, last May we debated the needs and problems of the mentally handicapped, the mentally ill and their families. I think it is a measure and a reminder of how urgent and important this matter remains that under the stimulus of the Griffiths report we are debating it again. It was emphasised then by many speakers that moving people from residential care into the community should not be seen as part of an economy drive. It may even cost a little more in financial terms, although the continuing lack of research and monitoring makes this a very difficult matter to assess accurately. That is one of the points which I think we ought to be making on an occasion like this. Again, we need to distinguish between the mentally handicapped and the mentally ill. The mentally handicapped are sometimes described as those who have severe learning difficulties. They will probably require care all their lives in a fairly stable context, sometimes not that dissimilar from the physically handicapped.
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On the other hand, the mentally ill may require a lot of care at one stage and little or none at another. Certainly the pattern will vary for many patients. The public often assume that these two groups—the mentally handicapped and the mentally ill—are exactly the same. I think that they need help in understanding that people with mental handicaps are unlikely to behave in the violent and sometimes bizarre way that someone suffering from a severe onslaught of schizophrenia, for instance, might display, particularly if that person lacks suitable medication and help.
Community care at its best offers a more flexible regime than large institutions have been able to offer. However, here again we need to recognise that, as has already been pointed out, the phrase covers quite a large spectrum, from people who are living with their relatives—and this will probably remain a very large proportion—to people who are living in small, family-type houses, right in the streets with others, through to clusters of small houses on one site which may be former hospital grounds. Alongside that sort of permanent residential accommodation in the community, people will also be using and needing day centres for that individual professional help which they require all the time.
I think I can best illustrate some of the points that I want to make this evening from several stories, all of which come from my diocese of Southwark, which is South London and East Surrey. The first story concerns St. Lawrence's Hospital, Caterham, a large and well-known hospital for the mentally handicapped. This hospital, with nearly 1200 patients a few years ago, is due to close in 1994. In the last four years about 550 residents have moved to new homes of one kind or another, some to quite different parts of the country; they have gone back to the places from which they originally came, they are not near Caterham. In the gounds of the hospital itself or nearby, houses and bungalows have been built which provide residential and therefore day care for about 470 non-Croydon people. For the London Borough of Croydon itself, there will be about 160 residential places and 200 day places.
Thanks to dedicated and caring leadership of a very high quality, the whole operation so far seems to have gone smoothly. Progress of ex-residents has been monitored even in other parts of the country, and in one case some were transferred from a home where they were not being looked after properly. There is a long tradition of good cooperation with the local authority. The chaplain is one of the many staff who has been closely involved with the process, visiting ex-residents in their new homes far and near and spending time with local clergy or ministers, for instance, to alert them to the new arrivals and to help them and their congregations adjust to and accept some unfamiliar things. All that has been of a high order, I must say, and of a fairly rare order compared with most others that I know about.
So far then, one might say, so good. But sadly, even here, it looks as though the whole exercise is beginning to slow down and limp because of local authority financial restrictions. Croydon, be it noted, is not a poor borough; it is, shall we say, rate minded. So we are brought face to face even here, where there

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has been a long and positive tradition of cooperation, with the most intractable problem of all, namely, who is to decide what is an appropriate level of assistance and who then is to be responsible for finding the money, especially if partnership funding is required or regarded as the norm?
Story number two illustrates the same point much more sharply and sadly. In 1984 nine people were transferred into community care with the London Borough of Merton. This was agreed before any long-term strategy had been worked out with the Merton and Sutton health authority. When a strategy was presented, agreement could not be reached on the level of care to be provided or on the division of costs. So I understand that in Merton, a large London borough, the figure remains at nine. There, as at Banstead and other places, it seems clear that health authorities are determined to use some of the moneys saved by the closure of mental hospital wards to undergird existing or new work elsewhere. They, too, have their problems over funding. But with local authorities cutting back and health authorities diverting to urgent needs elsewhere, how can satisfactory levels of financial assistance be made available for the adequate care of women and men trying to cope with the demands of life in the ordinary community?
Wandsworth, another South London borough, badly needs a day centre for the mentally ill. The local health authority has put forward a proposal for joint funding, in line with present practice and with the Griffiths report. But noble Lords will not be surprised to hear that in a borough which is determined to keep its rates low, and especially in preparation for the change to the community charge, insufficient funds are forthcoming. Once again, the mentally ill lose out. I wish to draw the attention of noble Lords to what is, I feel, the false optimism of the Minister's reply in the debate we had in this Chamber on 18th May, when he said:
"the speed and detail of the development of services in any one area will depend primarily upon the relevant health and local authorities making the best use of resources available to them."—[Office Report, 18/5/88; col. 367.]
I am afraid that the situation is that nothing happens because they cannot agree on finding sufficient funds between them because of other, existing pressures. That, of course, brings us to the more tragic side of putting people into so-called community care without sufficient preparation and without adequate and continuing support. As I have already tried to make clear, a good level of assistance for both the mentally ill and the mentally handicapped requires not only accommodation, food and clothing, but also professional support from doctors, nurses and social workers. That is often most easily provided in a good day centre. Good neighbour support is needed from local people, local churches and many others.
One has only to think of the difficult art of filling in the forms for means-tested benefits, for example, or of managing on very small funds when one has not had to do so for years, to realise how impossible that must be for many of the people we are thinking about today. There is an enormous need for the kind of
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simple practical help—education, if you will—which a good family welfare unit might provide. But there are only very few of them.
I realise that my time is drawing to a close, but I must end by saying that in London mentally handicapped people find their way into a broken-down situation and end up on the streets. I have the recently issued annual report of the North Lambeth Day Centre, which is situated in the crypt of St. John's Church, Waterloo. The report states:
"We work with an increasing number of people who have a history of mental health problems, some have spent long periods in institutions and have been discharged to the streets or to inappropriate or unsupported accommodation in the 'community'…We, like other agencies are therefore seeing more people who have severe and often acute mental health problems, isolated and without the necessary resources to support themselves, ending up sleeping on the streets."
I am the last person to suggest that money is the only ingredient needed for good levels of community care. But there is a minimum, and it must not be pitched too low. We urgently need more evidence to test the validity of the experiences that I now hear about all over south London. Sometimes those experiences are good, but mostly, sadly, they are bad. One chaplain perceptively put the position to me thus:
"It has been taken for granted that community care will be better, rather than that it can be better. The experience of many workers and patients and relatives is that it can be, but that just as often it fails to be."
7.4 p.m.
The Countess of Mar: My Lords, I am extremely grateful to the noble Lord, Lord Carter, for bringing our attention to the predicament in which the mentally ill and the mentally handicapped who are discharged from long-stay institutions into the so-called "care of the community" find themselves. The Minister is well aware that their problems have been of concern to me for a long time.
A major problem with both groups is that they do not see themselves as being ill. Certification of their inability to work is a prerequisite to enable them to claim additional social security benefits, such as the disability premium. They, and for that matter social security officers, cannot distinguish between a medical statement of their condition and a sick note which certifies that they are suffering from an illness. Those who suffer from learning difficulties—the modern term of mental handicap—will often most vigorously deny their illness. Therefore, they do not see the need for a medical certificate, and as a result they do not receive the financial assistance appropriate to their needs. Their level of assistance is reduced to the income support personal allowance only, and they will not be able to pay their carer for the supervisory nature of the care once they leave an institution.
People with mental illness discharged from hospital frequently regard their GP, community psychiatric nurse, social worker and Department of Social Security office as officialdom, and are therefore hostile to them. They more frequently fail to keep appointments with their GP and social worker and do not receive medical certificates or medication. Many fail to claim any social security benefits at all.

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They are unable to pay for accommodation and are asked to leave by their landlord or landlady. They drop out of the system, wander the streets by day, sleep rough at night and scrounge what they can from relatives and friends. Sooner or later they will suffer a relapse of their illness and have to be re-admitted to hospital, simply because they cannot cope with the system which is designed to help them to be self-supporting.
We need to bear in mind that this is not a problem confined to those recently discharged from institutions. It is, and will increasingly become, a long-term problem. I will give the House an example which is typical of the sequence of events which arises. Len had been in a mental hospital in Birmingham for 20 years. He suffers from a psychiatric illness, has borderline learning difficulties, is blind and incontinent. About 10 years ago he was selected for discharge into the community. Under the hospital's discharge plan he was moved to another hospital in Malvern where he stayed for two years and was taught some social skills. From there he was discharged into a hospital in Worcester. While there he had various jobs, mainly washing-up in hotels. He formed friendships with people similar to himself, some of whom had severe personality problems.
A year later he was judged ready for his real move into the community. The local social services department found him accommodation in supported lodgings in Bromsgrove, about 12 miles away. He did not work but attended the town day centre. His social worker was unhappy about this arrangement, as his landlady was suspected of exploiting him. The motives of the social worker were not known, but Len developed a sense of anger with and distrust of his landlady. He was encouraged to return to Worcester and to re-establish his old friendships. His new landlady was unable to cope with his incontinence and his inadequate friends. So, on the basis of "the devil you know", he returned to his former landlady in Bromsgrove.
There his social worker reviewed the payments he made to his landlady. It had been noticed that he never had enough money to pay for day centre activities, such as outings. The landlady was accused of being paternalistic and denying him the right to make his own decisions. That provoked a social security crisis which took four months to resolve. Three months after that, Len's landlady's marriage broke down and the matrimonial home was sold. She bought another house which was large enough to accommodate Len as well as herself. She needed the money to which Len was entitled to help pay the mortgage.
The move provoked another DSS review. Benefit officers said the move was a change of circumstances and reduced Len's board and lodging payment to the lower rate, which excluded the extra element he received to pay for his care. The decision went to appeal and five months elapsed before the status quo prior to the move was ordered to be restored by the appeal tribunal. I heard today that the local social security office is still withholding Len's benefit, despite that decision, while it decides whether or not to appeal to the commissioner. That is no way to treat
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a person who is fit and in possession of all his faculties. It is an abominable way to treat Len with all his handicaps.
The need for a common policy for all the government departments concerned with the discharge of patients and their subsequent care in the community is now extremely urgent. Legislation enacted in October 1986, December 1986, April 1987, July 1987, April 1988, and that to become effective in April 1989, all affects this client group and their accommodation. Social workers, carers and community nurses simply do not know where they are going. Home finders cannot recruit landladies. Social service administrators do not know what effect the April 1989 income support changes will have upon the numbers involved. They do not know which elements of care costs housing benefit and rent officers will deem ineligible for rent purposes. They are unable to prepare realistic budgets for social services support for that client group for the next financial year. As far as they know, central government have made no provision for either direct subsidy or an increase in rate support grant.
Perhaps I may ask the Minister to ask his right honourable friend the Secretary of State for Health, who is I understand responsible for personal social services, to advise social services directors immediately—and I mean immediately—what the position will be after April 1989.
I have tried on many occasions, by being persuasive, to draw to the attention of Ministers in this House the problems being experienced by those responsible for implementing the Government's "care in the community" policy. I shall no longer mince my words. By all means let the National Health Service discharge the mentally ill and the mentally handicapped into the community, but tell them first that they will be extremely lucky if they get suitable long-term accommodation with an understanding landlord or landlady; that they may or may not get a social worker who is capable of solving their problems and who is able to see them regularly; that they will have to learn to cope with the vagaries of the social security system, which is on the whole unsympathetic towards their needs; that their GP or community psychiatric nurse will have problems in keeping up with them if they move—all because the Government will not agree on a proper, humane policy and steadfastly refuse to provide the necessary funds. Let those people have the choice but let it be informed choice.
7.11 p.m.
Lord Rea: My Lords, I think that we should regard this debate, introduced so ably by my noble friend Lord Carter, as a continuation of the debate that we had in May which was introduced by my noble friend Lord Basnett. As the right reverend Prelate the Bishop of Southwark said, the fact that we have had two debates in the same year is an indication of the importance of the topic.
I want to make a few remarks which I hope will be different from those that I made in the previous debate. However, the situation has not changed in the past six months; it may even be a little worse.

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Looking at the problem, I should like to make one or two points as seen through the eyes of a practising general practitioner rather than from a national perspective. I have with me a computer print-out with 50 names on it which is the list of schizophrenic patients in our practice. Not all of them present very difficult problems at the moment. Some are in a stable state. As the right reverend Prelate said, mental illness is a fluctuating condition.
We also have many other seriously disabled mentally ill patients who do not come into the category of schizophrenia. For example, our practice provides the visiting medical officers to a hostel for eight severely mentally ill patients who have just been discharged from Friern Hospital. Only two of those eight patients appear on my list of schizophrenics. The others have various other disorders—manic depression, severe personality disturbance, etc. That provides an indication of how as GPs we must always be aware of the problem of mental illness.
I am an admirer of Sir Roy Griffiths, and I think that his report is the best that we have had so far on what the Government should be doing about community care. He mentions the role of the general practitioner in several paragraphs in the document. I am very pleased that he recognises the crucial role of the GP in community care. That applies not only to those discharged into the community from long-stay institutions but also to all those with dependency needs even though they have never been in hospital. It is my experience that the latter are now far more numerous than those who have recently been discharged from hospitals. That is partly because of the policy of community care in which the ethos over the past decade has been not to create new longstay patients. Therefore many who would otherwise become long-stay patients are in the community and many of them are not catered for adequately.
Sir Roy says in paragraph 6.14 of his report:
"The contract between the family practitioner committee and the general medical practitioner should be amended to specify that the GP, either directly or through his practice staff, should inform the social services authority of possible community care needs of any patients registered with him who seem to have such needs which are not being met and which appear to be unknown to the social services authority. The GP should also be able to satisfy himself that the social services authority has considered the case. The social services authority should therefore confirm that it has received the referral from the GP, and tell him what action it has decided to take".
In other words, Sir Roy recognises that the general practitioner and his associated primary health care workers, as the first port of call for people in need, should ferret out the most needy people and monitor whether social services departments are responding appropriately. 1 think that that is a role which good general practitioners are already playing.
As the Royal College of General Practitioners pointed out in its response to the report, more detailed work is needed to establish exactly how general practitioners' new responsibilities are to be defined. Very good relationships between general practitioners and social workers are also required; a state of affairs I am afraid to say which sadly does not exist in many parts of the country. One reason for that is that hard-pressed social services departments
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often work with under-trained staff—as the right reverend Prelate pointed out and the noble Baroness, Lady Faithfull, said yesterday—and do not have the resources to provide what general practitioners, their patients and patients' families feel is needed.
If social services departments were augmented and funded with earmarked grants as Sir Roy suggests to provide really effective community care, I could foresee a very rapid improvement in general practice social work relationships. That would pave the way for GPs, in association with other primary care workers—district nurses, community psychiatric nurses, health advisers for the elderly—to provide the medical cover which might prevent many vulnerable people from having to be readmitted to hospital when they enter a crisis.
Fully operational and effective community care, if it could be created, would in any case help to prevent those very crises from occurring in the first place. That in turn could well lead to very large savings in hospital costs for acute admissions. That is where the big money is spent in the National Health Service. However, it is only after a substantial initial investment in community care that those savings are likely to accrue. I would suggest that that is a further case, like many others that we have seen recently, where short-termism (if your Lordships will excuse the phrase) is totally inappropriate.
I should like to say one more word about the role of the GP. We should like to be consulted before patients are discharged and be part of a team that plans the community care. Too often an unwise discharge takes place which results in an early readmission. If the general practitioner and the primary care team as a whole were involved at an early stage, in co-operation with other carers, better relationships could be built up and the care for the patient would be better so that readmission might not be needed.
Much discussion on community care centres on housing need. That is of course a basic essential. If it is well planned it will provide a good basis for total community care for the people we are discussing. Yet I feel that housing is not the most difficult part of the operation; though, as my noble friend pointed out, in the inner city situation things are a lot more difficult than they are in less built up areas. That is largely because of the very much higher prices for housing units in London. I understand that £45,000 from various sources is regarded by the DHSS as a suitable sum to provide for a living unit; but in fact my advice is that the cost in London is something like double that figure.
The hostel about which I spoke earlier, where there are eight discharged patients from Friern, has now been in operation for a year and three months. It is one of the good ones. It is a success story. Nevertheless, the total costs for that hostel including buying the house and re-equipping it, were around £240,000, which adds up to £30,000 per inhabitant. Those were costs incurred some years ago; now costs are very much greater.
Apart from housing, I consider that the most important aspect is to make mentally ill people feel welcome and part of the community into which they

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are sent out to live. Too often their housing is segregated as are their day centres. Their difference from mentally average people stands out even more in the community than it does in the safe and often nurturing, though frequently sordid, hospital environment. There is a great need to set up and equip more units where some semblance of a work environment is created; one in which mentally ill and mentally handicapped people can be made to feel useful and be allowed to earn a little money which, it is hoped, will not be immediately deducted from their social security payments.
As Sir Roy points out, there are successful examples of community care to be found scattered throughout the country. It is important that the reasons for their success are identified so that they can be repeated and high quality community care can become a reality as much (or more) for those already in the community who are too often drifting as for those who are about to be discharged from hospital. However, that cannot be done without substantial extra funding, as MIND has pointed out. Some £500 million is a suitable sum. It would be a very wise investment. I hope that the noble Earl will be able to tell the House a little more about the Government's response to Sir Roy's report, and perhaps give us some welcome news that there may be some more money on the way.
7.23 p.m.
Lady Kinloss: My Lords, the noble Lord, Lord Carter, has given us the opportunity today to discuss some aspects of care in the community for people with mental illness or mental handicap who are leaving care.
When I read of Miss Sharon Campbell's case, my husband remarked that the fate of the social worker had happened to him—almost happened to him—some 40 years earlier during the war, but as he was seated at a trestle table, he was able to shove the table top into his attacker's stomach. Perhaps very serious attention needs to be given to the conditions in which interviews by social workers take place, having regard to the fact that they may need to protect themselves. That is not to say that I do not feel the greatest sympathy with those who suffer from mental handicap or mental illness. However, due thought must be given to the protection of social workers who, in their charity, provide support for the needs of their suffering clients.
Anyone who has been in hospital, even for a short time, knows that there is a certain shock when coming out and that it takes a little time to adjust. There are about 30,000 people with mental handicaps who are still in hospital and homeless in the real sense. I mean that they have a roof over their heads but they do not have a home of their own. Moreover, there is another class of person who are living with elderly parents and are in danger of becoming homeless in an actual sense when the elderly pay, as they must, the debt of nature. There are also those with mental handicap or mental illness who sleep rough and are in temporary hostels or even, for one reason or another, find themselves in prison. However, we are committed to community care, but—and this is not in any sense a politically divisive
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question—how are we to cope with it in an ageing community?
There are large numbers of people who have been in hospital for many years. When they are sent out into the world at large, unless they are given very carefully considered support we shall see some of them ending up in cardboard boxes under the arches. Perhaps in some cases they have been sent out into the community rather too quickly. Some organisations are worried that the pace of hospital run-down and closure is outstripping the development of community services.
Anyone who is sent out into the community after a period in a psychiatric hospital requires proper preparation and help. The Royal College of Nursing is very concerned about some of these cases. They need to be shown how to shop, board a bus, and even perhaps how to cook for themselves. They really need sheltered accommodation or a hostel. In many cases board and lodging facilities are unsatisfactory, as they receive very little help.
The National Schizophrenic Fellowship is concerned about those suffering from schizophrenia moving into the community without sufficient support to look after themselves. A pilot study of 750 schizophrenics who had recently been discharged from three hospitals notes 36 per cent. with two or more discharges in three years. These people really do need hostel accommodation, group homes or some other form of sheltered home. The most important thing is for them to continue with their medication. If they are on their own they frequently forget to take it and so they return once more to hospital.
Another important issue is registration with a GP and, even more important, supervision and care from community psychiatric nurses and community mental health nurses, where they are available, who work full-time in the community and who will understand their needs. They will supervise their medication and see that they receive their benefits.
The Government have repeatedly said that extra money is going into the health service. That is very welcome indeed. But I understand that it does not go to health authorities; it goes into family practitioner committees. I am not saying that that is wrong, but investment in training and community work is essential if community care is to succeed. MIND and the Royal College of Nursing agree that manpower planning and effective training are essential to the success of community care. Community services require staff to work independently and take decisions without supervision. Perhaps I may ask the noble Earl who is to reply whether the Government are considering ways of giving extra and effective training to those who work with the mentally ill or mentally handicapped in the community and especially those who suffer from schizophrenia. As the noble Lord, Lord Winstanley, has already said, special training is needed for helping schizophrenics.
I have mentioned before in your Lordships' House that I am very concerned for the 16 to 21 year-olds who are in board and lodging and the effect that changes in board and lodging payments will have after April 1989. After the age of 19 a young person with a personality disorder who is discharged from

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local authority care into supported lodgings finds that the social services are no longer allowed to provide financial support. The young person has to rely on social security benefits, which are not sufficient for board and lodging, care and personal needs.
One case which has been brought to my notice is that of someone whom I shall call Joan, who is severely mentally handicapped. She was with foster parents from a young age but they were unaware of the way in which to claim social security benefits once she was over 19 years old. Therefore because they did not claim and are not considered as acting on a business basis, Joan only receives the personal allowance paid to 18 to 24 year-olds. She receives £39 a week instead of the £150 that she should receive. Her foster parents feel morally unable to evict her although they receive no financial recompense. I feel that she is very lucky to have such caring foster parents; otherwise she might end up, as others have done, under the arches.
I hope that the Government will look at the whole range of problems that are posed by care in the community and the supporting services for the mentally ill and mentally handicapped in our midst.
7.30 p.m.
Lord Mottistone: My Lords, I too should like to thank the noble Lord, Lord Carter, for introducing this Motion because it is necessary to make everyone continually aware of the problem both for themselves and for the carers for the mentally ill and mentally handicapped. Noble Lords will be aware that my particular interest is in the problems of schizophrenia and that I am advised in these matters by the National Schizophrenia Fellowship.
On 1st December we had an Unstarred Question on a schizophrenia matter which was raised by the noble Lord, Lord Winstanley. I shall endeavour not to duplicate the points mentioned then but there are some features of the report on the Sharon Campbell case which relate to this debate and are worth repeating.
To get the problem of the level of assistance available in the community into perspective, I should like to remind noble Lords that the idea of emptying the mental hospitals is not new. It was reflected in the 1959 Mental Health Act and is backed in principle by sensible people as well as do-gooders. Labour as well as Conservative governments have been working towards reducing beds in mental hospitals over the past 30 years. What seems to have gone wrong is that in the period leading up to the 1982 Mental Health (Amendment) Bill all the thinking in the DHSS—which led in due course to the 1983 Act—seemed to become over-biased towards keeping a check on psychiatrists, with a demand for repeated tribunal hearings for patients. The numbers of those appeal tribunals have in consequence increased enormously, and psychiatrists are strongly discouraged from sending people to hospital even when they should go there.
The case of Sharon Campbell, the subject of last week's debate, is a sad example of this. Subsequently
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it seems that the Government have been over-persuaded that the solution lay in care in the community and that this would be no more expensive than hospital care. Indeed, I remember hearing it said in this House that it would be cheaper. This attitude was adopted without any pilot schemes to find out how care in the community would work. We just went trundling into it. I am afraid we have made mistakes. The net result has been that from 1981 to 1988 the emphasis of government policy has been on shutting down hospital beds for mentally ill people. This has been carried out more quickly than it has been possible—or as we now know from practical experience even suitable—to create care in the community to match.
I refer briefly to my speech last Thursday. How do we cope with the person with whom nobody can live? All alternatives to hospital cannot cope if the schizophrenic is too ill. Sharon Campbell was asked to leave her home, her short-term hostel, her special hostel for former psychiatric patients and a bed and breakfast hotel because each time she caused disturbances, including attacking with a knife. Even less violent schizophrenics than Sharon Campbell can also be unacceptable in any little community, or may find the presently available alternatives to hospital unacceptable.
In our debate on 1st December I asked the Minister to tell us more about hospital hostels which it seemed might provide a form of care which could better cope with the person with whom nobody can live. My noble friend Lord Skelmersdale explained at cols. 967 and 968 what hospital hostels were, but he did not give any indication of how many there might be. I have heard of one at the Maudsley Hospital which has been going for 10 years. It has admitted 33 people and discharged 11 without readmission so far. That does not leave much space for new arrivals. Of the 11 people moved out, seven were put into an attached shared house with strong support from the hostel staff. It therefore does not seem that they moved far away from the conditions in which they had been living.
Reporting on their work in the hostel the Maudsley staff said that no locally available hostel or other residential facility was thought capable of adequately supporting these extremely vulnerable individuals. There is therefore a problem; and there is a problem of numbers. It will be most helpful if my noble friend Lord Arran can give some idea about how soon we might see more of these hospital hostels, and how many their might be by, shall we say, 1990. They may well fill an important gap in the community care for the mentally ill and, if so, we shall certainly want several of them.
Another suggestion I made on which ministerial comment might have been more helpful was that Recommendation 17.22 of the Sharon Campbell report should be implemented without delay. The recommendation was that health and local authorities in co-operation with relevant voluntary organisations should have a duty jointly to provide suitable after-care for former informal hospital patients who are or have been suffering from mental disorder until it was agreed by those people that it should no longer be necessary. The noble Lord, Lord

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Winstanley, nods his head because he made the same recommendation. It seems from Chapter sixteen of the report that the legislation in this area is not sufficiently comprehensive to have covered Sharon Campbell, and, by that token, many other mentally ill cases. I should perhaps remind noble Lords, who may not have read the report, that the problem with Sharon Campbell is that she murdered her social worker. It is therefore not a lightly handled business. It would be most helpful to have an undertaking from the Minister that Recommendation 17.22 is being considered as a matter of urgency.
It is clear from all speeches that a great deal more needs to be done to ensure adequate help in the community for people who have suffered, or are suffering, from mental illness. I believe that we should not shut down the beds in the hospitals so quickly. Many of these people require what used to be called asylum, in the nice sense of the word. They need to be protected from themselves and from the outside world. In some cases they need to be looked after so that they do not threaten other people. However, if we are not going to do that, we must have better facilities in the community where people with whom nobody else can live can be suitably handled.
I should like to be more confident than, sadly, I am that my noble friends in the Government are grappling seriously with this problem. I very much wish that this debate will stir them to do so more actively than they are at present.
7.39 p.m.
Lord Thurlow: My Lords, I am very glad to be able to follow the noble Lord, Lord Mottistone, because I heartily endorse every single proposition that he put forward. I should also like to confine my remarks to the subject of schizophrenics. This is a field with which I am personally familiar from sombre experience, and I regard it as the most serious and difficult part of the interlocking problems.
It is curious that tonight there has been an echo of yesterday afternoon's debate when the noble Lord, Lord Mishcon, summed up by making three pleas. There was a plea for the acceleration of action, a plea for the provision of more resources and a plea to increase and improve training. Those pleas applied to the Children Bill, but they also apply to this debate.
Noble Lords have already said that the 1959 Act laid down admirable principles which generally have been endorsed ever since. However, there has not been the opportunity to apply the principles correctly. We are now in a sombre situation of increasing gravity, as all noble Lords have pointed out this evening. We are not even holding the position; it is becoming worse.
In regard to resources local authorities continue to be in the lead position for providing aftercare, for better or for worse. No doubt they receive great support from the health service but they must provide the main means of aftercare. There is no basis of a coherent policy because there is a gap between the provision of resources and the way in which they must be spent. No doubt there are good examples. This evening I am perhaps the first noble Lord to
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mention a good example of aftercare; it is the splendid experiment at Torbay. I hope that many local authorities will repeat and follow it, but it is still an experiment.
All noble Lords who have spoken tonight agree that, in general, local authorities throughout the country are not measuring up to their responsibilities. There are perfectly understandable reasons for that, one being that they are squeezed for funds. They are not in a position to spend what they want and, with great respect to many of them, they do not understand the priority of this need.
Thirdly, there is the plea for more training. The noble Lady, Lady Kinloss, has already referred to that and I shall not duplicate her words. It is common ground that there are not nearly enough qualified psychiatric community nurses. Somehow or another the void must be filled.
I should like to turn to a particular matter which has not been covered tonight and which I know is highly controversial. During the debate on the Sharon Campbell case reference was made to the difficult problem of compulsory treatment orders and to the question of how to give power to the elbow of doctors and social workers who are unable to induce schizophrenics to take the medication and go to the day centres as they have been advised. The Spokes Committee recited some of the considerations but made no recommendations. Perhaps that is not surprising in view of the formidable practical difficulties and problems.
I have lived with a schizophrenic who refused to take his medicine, which resulted in the inevitable deterioration of his condition. There is no alternative: patients with acute schizophrenia who will not take their medication will become worse and every kind of serious sympton—for example, violence and nuisance—will follow. As the noble Lord, Lord Mottistone, has said, it becomes impossible to look after them. We are dealing with people who cannot be looked after by families in ordinary living conditions. There are more such people circulating as a direct result of the policies of closure and often they are violent. Last Thursday we heard of the sad case of Sharon Campbell, and there are a good many more. However, for each homicide there are hundreds, perhaps thousands, of cases of violence by untreated schizophrenics and there are many suicides.
I can see no way of avoiding, or at least mitigating, the growing dangers to both the community and the patients without recourse to compulsory treatment orders combined with much improved monitoring, registration and computer records. Most people who have considered the matter regard the difficulties as being too great. With respect, I doubt whether they personally have had to endure attacks from violent schizophrenics. Even if means can be found, how will nurses proceed in the face of resistance to bring the patients to a treatment centre? The Spokes Committee concluded that the only effective sanction would be to admit to hospital as a compulsory patient anyone who consistently refused to take the prescribed treatment. Difficulties would follow. There would have to be second opinions and appeal procedures. However, against all the difficulties and resource problems must be weighed the continuing

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dangers which exist and which are increasing. We cannot continue to duck those awkward decisons.
If sanctions were imposed it would probably be unnecessary to resort to them in many cases. However, the professions would have some power at their elbow to help them to induce their patients to do what they should. Every day parents, relatives, hostel staff and members of the public are having to face violence and all forms of antisocial conduct, or live under the shadow of fear of violence. Those evils must not be ignored under the banner of respect for human rights. As the noble Lord, Lord Mottistone, said, that was the fashionable cry in 1983 and 1985. In our debates everything tended to be subordinated to the rights of the patient. The dangers and interest of the patient tended to be lost sight of. It is very much to be hoped that the Royal College of Psychiatrists in its forthcoming report on aftercare will grasp the nettle.
7.50 p.m.
Lord McCluskey: My Lords, in welcoming the initiative of the noble Lord, Lord Carter, in having a short debate on this matter, I should like to declare my interest. I am Chairman of the Scottish Association for Mental Health, which is a voluntary body substantially supported by government funds. It pursues a policy of promoting care in the community and is a body which provides both sheltered residential accommodation and supported employment training for a total of more than 500 people in Scotland. Indeed, we are the largest provider of such employment training for people with disabilities and I believe that that gives me a right to speak. Both the carers and those for whom we care have given us a good deal of feedback on what are the problems.
Your Lordships will not be surprised to learn that we as a body are highly critical of the chasm—and that is the only word for it—that exists between the rhetoric of successive governments and the reality, the reality in Scotland of wholly inadequate community care, facilities, funding and resources.
I should like to begin by emphasising the distinction made by the right reverend Prelate the Bishop of Southwark between mental illness and mental handicap. Most of the recovering mentally ill need relatively short-term support, shelter, training and finance within the community. I only draw attention to one other difference which is possibly the most striking of all; perhaps one person in four of the population will at some time in their lives be afflicted by some degree of mental illness which requires treatment. Therefore, in relation to mental illness we are not talking about managing a small identifiable group whose dependency is permanent but we are talking about any one of us who may be struck down seemingly at random by mental illness and who may thereafter require outside help to return to normal life.
If I have time, and I understand that the debate is running ahead of time, I shall address myself to the problems under three headings: poverty, homelessness and neglect. I recognise that many people who experience mental illness are cared for by
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loving families or friends. I do not wish to suggest that mental illness necessarily condemns the victim to a life of deprivation, idleness and neglect; obviously it does not. However for some—and this is the prospect which is opened up unless they are helped—that is exactly what may happen. It is they who are most in need of organised community care. It is they who we fail if the levels of assistance are inadequate. It is they who have nowhere else to go and no one else to whom they can turn.
Perhaps I may first refer briefly to poverty. Most of those who are discharged from residential care and cannot return home will either find their way to some form of hostel or will have to seek private board and lodgings with a private landlord. Those in managed hostels receive £9.55 per week to spend on bus fares, hair cuts, cigarettes, shoe repairs, newspapers and all recreational and social facilities. That is a miserably inadequate pittance. Those who have to go to private landlords, and they are the majority, receive housing benefit and income support and they are, in terms of personal spending power, no better and perhaps worse off. In a few months' time in Scotland and a little later in England they will become liable to pay the community charge. Even if they qualify for the full rebate, they may still have to find in my area some £60 to £80 annually out of their meagre pocket money. People as poor as that—and their chances of employment are minimal—may be physically in, but are hardly part of, any community I know.
Some of those boarding in the private sector face another problem—of prescriptions. As your Lordships know, a prescription costs £2²60 per item. The mentally ill are often prescribed drugs in small frequent doses because doctors fear that there is a danger that they may take an overdose. They sometimes require other drugs to counteract the effects of the primary drugs which they are taking. However, mental illness is not included in the list of chronic medical conditions qualifying for free prescriptions. Therefore, unless the patient is exempt by reason of poverty he tends to do without the prescribed medicine. The problem of persuading non-residential patients to continue their medication is already severe and if they also have to pay prescription charges it becomes nigh insuperable.
The poverty that clings to those who move from residential care into unemployment and poor quality lodgings eats away at their self-esteem and prevents them from developing any structured lifestyle in which they can achieve and consolidate true mental health. I have given the Minister notice of these questions and I should like him to tell us specifically if those persons who have been discharged from residential care after treatment for acute mental illness and who have gone to live in private boarding accommodation have any prospect of being exempted from the community charge. I also ask him whether or not the Government have any plans to assist those afflicted by mental illness but not resident in managed accommodation to meet the potentially crippling costs of their prescriptions.
I should like to say a few words on homelessness. There is a vicious circle here. Homelessness tends to precipitate stress and mental illness but the very symptoms of mental illness by alienating family,

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friends, neighbours and workmates tends to precipitate homelessness. Therefore, many of those who leave hospital after treatment for mental illness end up in private boarding houses, sharing rooms with strangers often in very poor conditions in the worst areas of the town or city. As I have said, their chances of employment are almost zero. They can easily be driven into neglect of their medication, idle hopelessness and alcohol abuse or other forms of behaviour which are deemed to be antisocial or even criminal. Therefore, they can easily be trapped into the spiral of becoming down and out and of drifting hopelessly and aimlessly into homelessness.
It is not clear to me that the Government understand the desperate situation of such people. The noble Lord, Lord Winstanley, reminded us that perhaps half of the existing hostel places may be lost overnight very shortly. Such hostels are often the only refuge for those with mental health problems. Are more of those people to be driven onto the streets?
The kind of thinking that could lead to this sudden loss of perhaps hundreds or thousands of places is an example of the phenomenon experienced by all who work in the voluntary sector and concern themselves with mental health and community care. That phenomenon is the lack of coherence and consistency in central government, whatever its political colour. Too often the left hand does not seem to know what the right hand is undoing. Therefore, the voluntary agencies are constantly having to duck and weave to avoid being bludgeoned by the frequent changes of direction, pace and purpose of government departments and agencies. They alone have the funds to sponsor accommodation projects, training, counselling and the like. That is very frustrating and bewildering.
Only 5 per cent. of those who experience mental illness become hospital in-patients—a well known statistic. However, especially in Scotland, the overwhelming bulk of the funds and resources provided for mental health go into hospital care. Therefore, resources for community care are inevitably, as the noble Lord, Lord Thurlow, said, inadequate. There is little reason for optimism. At present the tragedy is that in the United Kingdom, in which vast sums of public and private money are spent on meritricious projects and pastimes, so many of the non-hospitalised mentally ill have become neglected because government and various other statutory bodies will not find the money to spend on the unglamorous field of community mental health.
In Scotland we do not have vast numbers of people impoverished on the streets. Instead of turning large numbers onto the streets, we keep in psychiatric hospitals many people who, with the necessary support, could return to the community to rebuild their lives and rediscover their independence and personalities. For in Scotland there are twice as many hospital places per head of the population as there are in England and Wales. The Scottish Office, whose education department has responsibility in this field, sent out a circular on 1st June 1988 in an attempt to avoid the scandal of patients being discharged from psychiatric hospitals when no adequate community
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facilities exist. Three times in the circular the Scottish Office refers to what we all know to be the limiting factor—the inadequacy of existing or available resources. That same unacceptable justification is put forward for the failure to bring into force Section 7 of the Disabled Persons (Services, Consultaton and Representation) Act 1986. When will those resources be found? I ask the Minister to tell us when the Government plan to implement Section 7 of that modest little Act.
I should like to mention one last matter. There is a deep reluctance among professional therapists to leave the environment of the psychiatric hospital and go into the community and offer their skills there. I believe that there is a need for health boards and health authorities to offer and to provide redeployment training for their staffs and training about the nature and principles of community care for people with mental health problems. Unless the professionals join other carers in the community and see at first hand both the opportunities and the massive shortfall in what is needed we shall never make a reality of community care.
The noble Earl is tonight in a position to offer us some comfort and hope. We trust that he will not simply add to the verbal mountain that casts a shadow over all our endeavours.
8.1 p.m.
Lord Taylor of Gryfe: My Lords, one of the advantages of a mistake in the Whips' Office is that I am following the noble and learned Lord, Lord McCluskey. He spoke of his Scottish experience in this field and I know that all of us in Scotland are indebted to him for the authority which he carries in Scottish affairs and his constant reminders of our obligations in this particular field. I hope that the noble and learned Lord will be encouraged to come to the House more frequently and deal with these matters which represent a deeply held concern in all parts of the House.
I hope that at the end of this debate the Minister will be aware of the depth of that concern and that he will respond in a positive way to some of the questions that have been raised this evening. We would particularly like to know when the Government are going to respond to the Griffiths report. I gather that the date of the Griffiths report was about last February. Surely it is time that we had some indication of the Government's attitude on the important issues raised in that report.
I express a personal interest in this matter. I am the chairman of Scottish Action on Dementia. Dementia is regarded in the Secretary of State for Scotland's report on the health service in Scotland as being the priority consideration. This is in response to the Sharpen report which he commissioned earlier. With an ageing population, inevitably dementia will have increasing importance.
In addition to the subject of care that is required in this area I have noted that the Scottish Association for Mental Health has prepared an interesting report on the position of dementia cases under the law. I am sure that the noble and learned Lord, Lord McCluskey, has much to contribute in that area for

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simplifying the legal position of guardianship and advice for people who suffer from mental illness, particularly dementia. That report states that guardianship under the Mental Health Act was designed as a method of caring for people in the community. Instead, it is being used as a method of removing sufferers from home to community care. This is an important matter.
The noble Lord, Lord Mottistone, asked about the relative costs of community care and residential care. My information is that residential care costs £230 per week as against £160 per week for care in the community. That suggests that the latter is not only desirable socially, but desirable economically.
In relation to costs I quote one other interesting statistic which has been provided by the Scottish Association for Mental Health, with which the noble and learned Lord, Lord McCluskey, is associated. At least twice as much is spent on building and improving hospitals than is spent on funding community care, yet 95 per cent. of the people with mental health problems live in the community. It costs twice as much in the maintenance of hospitals yet only 5 per cent. of the people with mental illnesses are in hospitals or residential care.
Like the noble and learned Lord, Lord McCluskey, I read these reports from government departments. I have in my hand a particularly glossy report on the priorities in the Scottish service. This identifies services for old people with dementia in hospitals and in the community as their first priority. But we are becoming a little tired of glossy documents saying "This is our concern" or "This is government policy" but with little action to support these confessions of interest. Therefore, I hope that the Minister will give us a positive response.
I am interested not only in the Government services but also deeply concerned about state support for the voluntary organisations in this field. For some years I have been involved with an organisation called Link, the Glasgow Association for Mental health. It receives some government funding but could do with more. It recognises that there is little aftercare service for people who emerge from hospital with mental health problems. Link has set up a number of clubs in which people can meet and discuss their problems in a social environment. It encourages them and helps them to feel restored to the community.
The organisation is also deeply concerned with providing employment opportunities for people with mental health problems who have come from hospitals. People who emerge from a mental institution do not readily find employment. There must be organisations which monitor that situation and which encourage employers to take on people with such difficulties. Therefore, aftercare clubs, pressure on employment opportunities are undertaken by Link.
The problem for people with mental illness is the inevitable revolving door principle. They go into mental hospital for a period and then leave for a short period but are then back in again. Therefore, we have to make them feel a part of the community and on the
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way to recovery rather than simply engaged all the time in this meaningless and hopeless practice.
I remind the Minister of the responsibilities which the Government have in relation to the Disabled Persons (Services, Consultation and Representation) Act 1986. This states:
"All parties who have been in mental illness or mental health hospitals for more than six months should, if and when they are moving into the community, have a full assessment of their needs".
That requirement has not been implemented. Another paragraph states:
"They also should have an authorised representative to speak for them and obtain appropriate services in the community".
That has not been implemented.
We debated these matters in the House. We passed the Bill. We assumed that the Government would have responsibility to carry out the legislation which we passed. I would welcome a comment from the Minister as to how and when those obligations are to be implemented.
8.10 p.m.
Lord Renton: My Lords, we have a few minutes in hand and I shall be grateful if noble Lords will bear with me while I make one point that is relevant to the debate. I apologise for my late arrival which was due to my involvement with a charity of which I am a patron. It was important that I should be there.
The point I wish to make is this. I became chairman of MENCAP in 1978. I immediately started to agitate, along with others, for getting mentally handicapped people of various ages out of long-stay hospitals where many of them had lingered for years. In 1980 the Government agreed with this, announced the policy and gave us some help. I call it pump-priming help because it was largely help with administration. It was in order to get our Homes Foundation scheme going, making it possible for mentally handicapped people to live in small groups in small places all over the country.
I was a little surprised to hear what my noble friend Lord Mottistone said as regards the policy having been a mistake. I must make it clear that in our experience of the mentally handicapped it has not been a mistake. The policy has mostly succeeded, with a few exceptional cases. We continue to welcome it and we shall continue to try and make it work.
Lord Mottistone: My Lords, before my noble friend sits down, I did not say that the policy was a mistake as regards the mentally handicapped. I was speaking entirely about the mentally ill. I believe that it has been a mistake to go so fast in their case.
8.11 p.m.
Lord Ennals: My Lords, this has been a very powerful debate. It was opened by my noble friend Lord Carter, to whom we are all grateful for his lucid case. We have also had some very moving speeches in the course of this quite short debate particularly from the right reverend Prelate the Bishop of Southwark, the noble Countess, Lady Mar, the noble and learned Lord, Lord McCluskey, and others. All the others were very thoughtful and informed speakers. One matter that was common to all was the great concern about the situation existing now in our society. I hope

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that when the Minister comes to reply he has something positive to say which matches up to the concern that has been expressed right across the Chamber.
As noble Lords probably know, I am deeply involved with the work of MIND and the services carried out by its local associations up and down the country. Earlier today I was at a meeting of the trust which tries to cope with the rising tide of homelessness and the growing army of people sleeping on park benches, under bridges, over hotel heating vents, in church porches, station concourses, empty houses, cardboard boxes and sleeping under and above newspapers in all kinds of places where they can find a position from which they are not moved.
There are two pictures of Britain today. One is yuppie and prosperous and the theme is spend, spend, spend; the other is very downtrodden, neglected, cold, forgotten and probably involves the mentally ill. Many of them are in prison and probably wrongly so. It has emerged from almost everyone who has spoken today that there is a new crisis. It is new because of the dimensions of that crisis. I hope that when the noble Earl comes to wind up this debate the Government show a similar sense of urgency.
I was very distressed when I heard a speech given by the noble Earl's friend Mrs. Currie when opening a MIND national conference last week. She was speaking about community care and she said:
"during this year and next, we will be looking closely at what we have on the ground, particularly from the point of view of the patient. I need to know more about what services we offer, and what actually faces a depressed young mother, or an alcoholic, or a disturbed offender, or a disorientated old lady, or the family of a schizophrenic when they ask for help in each region of the country. At present, I don't have a full enough picture, and sometimes suspect that not all parts of the local services do either".
She continued:
"Ministers will consider whether there are any steps it would be right and practical to take to improve the care of the mentally ill people".
I despair when I hear words like that coming from a Minister who is paid to know what the situation is in our country and in our hospitals and communities where people have been passed into them, and probably wrongly discharged, without a plan having been worked out for them and also without families to care for them. They are also without the community support that can make life tolerable, liveable and also enjoyable. For them there are none of the joys of life.
I wonder whether the Government feel a sense of responsibility about these matters. Perhaps there are some people in this House who are well qualified—the noble and learned Lord, Lord McCluskey, is one and there are plenty of others—and who feel that they know something about the local community and the challenges that have to be met. We find the Minister saying that the Government need to know a little more and then they will consider whether there is something that they can do.
Some of us know something of the situation in the old Victorian psychiatric hospitals. Over the weekend
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I quickly read through some of the recent health advisory service reports on our psychiatric hospitals. They make very grim reading and that is not just the reports made 10 years ago but this year, last year and the year before. They refer to gross overcrowding, dirty, shabby, badly repaired, smell of urine, unsuitable, drab, depressing, unsuitable, depressing and so the list continues. They are dilapidated and institutional life means that there is no place to live in dignity.
As regards treatment, there are some very fine nurses doing the job as best they can. The services were found to be deplorable, entrenched, defensive, custodial, misguided, degrading, de-personalising, negative, backward and so on. That is not a situation that we want to preserve in our society. The Government are right and it has been the policy of successive governments over the years, as the noble Lord, Lord Renton, said, that we should plan a combined operation. This would be over the years because it could not be done at once. The policy was to close not only the hospitals for the mentally handicapped but for the mentally ill as well. This would be done in parallel so that services matched. As people came out they went into a new type of service provided for them in the community.
This has been a policy that does not split us party politically and I am not certain that it does so when we look at the present situation. It is not as if the hospital closure programme has yet gone all that far. There has been a very substantial decrease in the number of beds. There have been approximately 200,000 admissions to and discharges from psychiatric hospitals each year. Fewer than 64,000 people are now resident in psychiatric hospitals. Long-stay hospital provision is being reduced at a significant rate with a drop in mental illness hospital beds of 25,000 in a decade.
When we consider the mental hospitals only two have been closed. I understand that 28 more are likely to close by 1995 with health authorities selling off the land. I hope that they will be turning the money back into the mental health services. I understand that that is not happening at present. I hope the Minister will say whether we can be absolutely certain that what is saved by the health authorities and the hospital building programme is put instantly and immediately into the services without delay. I shall later argue that the sums should be put into the community services in advance. Without the resources we cannot provide what is needed. One can look through all kinds of information that is given. One is beginning to see a decline in the provision available in the community. The expectation is that it will decline still further.
I expect that some noble Lords will have seen a brief that I received, and no doubt others will, from the Parliamentary Panel on Personal Social Services. It is a well-informed body under its all-party officers. The panel points out that the,
"Response to demand for community care i.e. new Day Centres, Group Homes etc. must be set against Government plans for gross capital expenditure by Local Authorities to fall by 5·9 per cent. in 1988–89 and by 14·7 per cent. by 1990–91".
That is a terrible situation. I am told that if I want further information I can get in touch with a Conservative Member who is chairman of the panel.

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He is a fine man and is probably better informed about the subject than anyone else in the other place.
I look at the type of services that should be provided. Reference was made by the noble Lord, Lord Taylor, and by my noble friend Lord Carter to dementia. Each district health authority will have to provide for an additional 300 dementia sufferers as the population grows older. Reference was made to the Disabled Persons (Services, Consultation and Representation) Act 1986, which provided a legal framework for advocacy, assessment of need and the provision of services. However, many sections of the Act—perhaps the most important ones—have not come into operation. Crisis intervention services are particularly necessary when there are schizophrenics in our society who have a recurrence of their condition. They need instant help and it is important that someone else as well as they themselves knows that they need instant help. Yet only four walk-in hospitals are available throughout England and Wales. This is a more important provision than the idea of a stop to the hospital closure programme.
We have talked about housing and the Government must do something about it. It is an essential component for community care. Yet since 1979 the housing investment programme has been cut by 60 per cent. in real terms. Housing subsidy has been eroded and council house starts are at an all time low. Housing Corporation allocations to housing associations have been reduced in real terms and are overstretched. The private rented sector has continued to decline. In these circumstances the availability of housing is at a minimum. As someone said earlier, psychiatric patients are at a great disadvantage in terms of housing. Many people with mental illness are caught in a Catch-22 situation. In hospital, they are not considered to be suitable for ordinary housing. Out of hospital, they are not considered to he vulnerable. Their needs are not being met.
Someone said that we have been talking too much about the rights of people who have been in psychiatric hospitals. I react against that very sharply. I want to fight for the rights of people who have had the misfortune of being incarcerated in mental illness or mental handicap hospitals. They are entitled to all the rights to which we are entitled. To think that somehow or other we can degrade them, demote them or put them into a category of people who do not deserve rights is appalling, especially when it is suggested in your Lordships' House, which over the years has been a bastion of protection of human rights. I know that it will go on being so.
The right reverend Prelate the Bishop of Southwark said that money is not available. This is the essence of the problem. MIND made a valuable proposal which was referred to by a previous speaker. It recognised that there would be a saving to the health service. It said that there was a great need for more money, especially at a time when the rate support grant is being decreased and rate capping is being imposed on local authorities. It proposed that there should be an immediate bridging grant of £500 million. It said that not only was more money per year needed but that there had to be a major injection of funds so that local authorities would be able to
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provide the services which the noble Lord, Lord Mottistone, and other noble Lords have recognised are necessary.
The noble Lord thought that the time had come to stop or to slow down the hospital closure programme. I am sure that that is the wrong answer and I was glad that the noble Lord, Lord Renton, intervened to say that. I recognise that the problems of schizophrenics and those with mental handicap are totally different. I recognise that the noble Lord, Lord Mottistone, made his proposal in regard to schizophrenia. I fear that if after all these years of bringing forward the policy of movement from the hospitals into the community we were now to slow down or stop it, it would take another decade or more before we would be able to get it moving again. Many of the hopes of people and their families that there would be something to enable them to live in the community would be shattered. It would be wrong for us to allow that to happen.
We have had many debates on this subject. Thank heavens your Lordships are wise in their choice of subjects. The Minister must say something about the Griffiths report and the vital recommendations contained in it. It is appalling that after so many months local authorities and health authorities do not know what will happen. Of course there are criticisms about the adequacy of community care when the authorities do not know where the responsibility lies. He must say something about resources. It will be no good just to turn out ancient figures showing that there are now more psychiatric nurses in the community. If one starts at a low enough level one can always produce figures to show growth. We must have from the Minister a statement to give us some confidence that the Government, unlike Mrs. Currie, understand the position, know where we are going and will lead the health authorities and the social services into providing a service which respects the human rights of the people who are now in hospital or in the community without those rights. The Government must take a lead on this crucial issue.
8.26 p.m.
The Earl of Arran: My Lords, we are truly grateful to the noble Lord, Lord Carter, for raising this important subject. It is important and will always remain so. Those are not vacuous and idle words. The title of the debate is significant because it calls attention to the level of assistance available to people with mental illness or mental handicap moved from residential care—I assume that the noble Lord, Lord Carter, is referring to hospitals—into the community. The debate, as I had suspected, has been wide-ranging and there are many important points to cover. I shall do my best to deal with as many as is possible, but perhaps at speed now and then.
The burdens imposed by both mental illness and mental handicap are heavy. They weigh on the sufferers, on their families and also on the services which provide treatment and support. But as your Lordships know, and as has been mentioned in the House on previous occasions, dramatic

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improvements have been taking place over a number of years. In the treatment of mental illness, for example, the development of a wider range of services outside hospitals altogether, with the advent of new treatment such as the major tranquillisers and the anti-depressive drugs, has led to a marked fall in the number of patients resident in hospital. The policy of providing services better suited to meeting the individual needs of mentally handicapped people has meant that the number of those destined to spend their lives in large mental handicap institutions has also fallen, and a much wider range of provision is now available for those who cannot live at home or who need, with their families, to do so.
The Government's primary aim is better provision for mentally ill and mentally handicapped people and their families. We want to see health authorities and local authorities co-operating together to develop a locally-based range of co-ordinated services. A comprehensive mental health service is the result of many partnerships between specialist psychiatric services, other medical and general practice, clinical psychology, local authority social services, housing authorities, voluntary organisations and self-help groups. But equally important is the involvement of the families and friends of people with mental disabilities and, by no means least, those people themselves suffering from mental illness or a mental handicap. As health districts develop their plans for new mental health services it will be essential for them to consider not only the span of services that they need to provide but also the extensive resources available from this range of interested bodies and individuals who can contribute to the development of a successful service.
The noble Lord, Lord Carter, asked for details of the reduction in mental illness and mental handicap staffed and available hospital beds over the past 10 years. The figures are 24,800 and 16,400 respectively for the period between 1976–86. Those figures are for England. We do not have forecasts for future closures. We expect health authorities to assess the number of beds needed based on the development of local services which can of course provide in-patient care in different forms.
I can assure noble Lords that we fully appreciate the anxieties expressed by many relatives and friends of both mentally ill and mentally handicapped people when faced with a change in the pattern of the way care has been provided over many years. However, there are benefits to be gained from having available a greater range of care provision so that those are more closely suited to the varying needs of mentally ill and mentally handicapped people.
Because the needs and problems of mentally ill and mentally handicapped people in the community are so different, I should now like to consider them in more detail. As regards mental illness, the Government's longstanding policy is that people with mental illness should have access to all the services they need as locally as possible. Our aim is to have a full range of local services, such as in-patient and day hospital facilities, day centres, residential homes, hostels, sheltered accommodation, supported lodging or special fostering schemes, group homes,
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drop-in centres, sheltered workshops, social clubs and self-help groups, as well as education training and employment services.
Some people will be able to live in ordinary housing with the support of visiting professionals. All this calls for considerable co-ordination and collaboration between the providing agencies, and also improved communication between the caring professionals, the sufferers and their families.
Collaboration still needs improvement. There are geographical, administrative and financial reasons why some health authorities and local authorities still find it difficult to plan together to provide integrated services. It can be done, as some districts have already demonstrated. I am very glad to accept the views of my noble friend Lord Balfour concerning the fact that early treatment is highly desirable. Of course the Government are anxious to promote preventive and early intervention measures.
I would now like to turn to some areas of special concern. Although an increasing proportion of mentally ill people have been discharged from hospital, it is still sadly true that some do not recover fully and may be left with severe disabilities, for which they need special help. The new style of service will be judged by how well those with special difficulties are helped. In the past too much of the care for this group was only provided in large distant hospitals. The development of locally based services does not imply any less commitment on the part of Ministers to provide proper care for this most vulnerable group of patients. Every local service must plan how best to provide that care without further adding the burden of institutionalism to the disabilities of illness.
It is also necessary to look carefully at available resources. In considering the possibility of hospital closure or run-down, we must bear in mind that at the end of 1986 there were some 10,000 beds empty in the mental illness service as well as some 8,000 vacant day hospital places. It therefore makes sense to ensure that resources are used in ways most appropriate to the patients needs.
The provision of effective continuing care for those discharged from hospital treatment is of central importance. Ministers have repeatedly emphasised the importance of professional teams' planning and agreeing individual care programmes with each patient and, where appropriate, with their families, before discharge. Once the patient is discharged, there must be proper monitoring and co-ordination of these programmes especially for those who are chronically ill or regarded as most vulnerable, to help clinical teams identify any problems as they develop and to act accordingly.
In response to the remarks made by the noble Lord, Lord Rea, we agree that the family doctor has a central role in the treatment and management of mentally ill people in the community. We are glad to read reports of much closer collaboration between general practitioners and psychiatrists, with some 20 per cent. of psychiatrists now spending some of their time working in primary care setting.
We are particularly concerned that the patient or his relatives do not lose touch with services and do

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not have to seek out for themselves what help is available. A measure of our concern is that planning guidance, issued to health and local authorities in July, requires that by 1991 each district should have developed a care programme to provide a system of co-ordinated continuing care for people chronically disabled by mental illness. We also emphasised that each district should ensure that a consultant psychiatrist has special responsibility for rehabilitation and continuing care.
As my noble friend Lord Skelmersdale reminded noble Lords in the House last week, he attended a working conference in February of this year, organised jointly by the DHSS (as it then was) and the National Unit for Psychiatric Research and Development at which people from the health and social services discussed the detailed requirements of a continuing care system. This conference built on research funded by the department in Salford, Southampton and Hackney to investigate the use of computers to assist in ensuring both that patients are less likely to "fall out of care" and that patients and carers received the information they need to ensure quality care.
A report of that conference was published by the national unit in September and the department is studying its contents very carefully as it prepares detailed guidance on the components of these care programmes. We are also, as my noble friend made clear in the House last week, taking account of relevant recommendations in the Spokes Report on the care and after-care of Miss Sharon Campbell, a concern that was underlined by the noble Lord, Lord Winstanley. As noble Lords who spoke on that occasion recognised, that report has made a very helpful contribution to thinking in this area.
The noble Lord, Lord Thurlow, raised the question of compulsory treatment in the community. That is the subject of discussions which have been taking place with such organisations as the Mental Health Act Commission, the Royal College of Psychiatrists and MIND. It is a complex area where there are strongly held views on all sides. No changes will be considered without a full consultation with all those concerned with mental health.
The noble Lord, Lord McCluskey, mentioned Section 7 of the Disabled Persons (Services, Consultation and Representation) Act 1986. As part of the discussions on implementation of the Act, officials of the department met local authority representatives on 17th November. The timetable for implementation will depend on the outcome of discussions with local authority and health authority representatives.
Although many people can cope, with professional support, in normal housing and sheltered bedsits, we accept that asylum in the sense of refuge should remain a necessary part of any comprehensive psychiatric service. The essence of the new service, even for the most severely disabled, is that it should be locally-based and hence more accessible for patients and their families.
I agree entirely with my noble friend Lord Mottistone on the importance of hospital hostels. I
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cannot, however, tell him the number presently provided by health authorities since they are not returned on statistics separately from other in-patient beds.
The Department of Health has been actively involved in research and development into ways of providing services to those who need long-term care in a health service setting. Research on high dependency hospital hostels has been completed in Manchester, London and Southampton, and in the course of the last year, the department has sponsored and contributed to five seminars presenting the clinical and economic evaluations of these projects. These seminars have been very well attended by practitioners and planners, and it is hoped that a publication summarising the findings will soon be available.
The noble Lord, Lord Winstanley, referred to the need for improved training of social workers. The Government have made extra funding available to the Central Council for Education and Training in Social Work to improve the practice content in social work training. Approved social work training of those who have statutory duties under the Mental Health Act now lasts for at least 60 days and has heightened social workers' understanding of mental illness.
The right reverend Prelate the Bishop of Southwark referred to lack of research into closure of hospitals. Research is being conducted by the Medical Research Council into the process and consequences of the run down and closure of Friern Hospital and Claybury Hospital in north-east London. The Department of Health is glad to have contributed to the funding of that research and is studying the reports of the research team with close attention.
I turn now to the provisions for mentally handicapped people and the help that they need. I am aware that many families and others involved in providing services are concerned that the community may not provide the right environment for some mentally handicapped people to give the care and protection that they require. That is why we have encouraged health and local authorities to co-operate and work together to ensure that the particular care needs of each mentally handicapped person are met through community based services that are appropriate and cost-effective, but with genuine choices for clients and the families. This also involves a need for the statutory service providers at local level, and with respective housing departments, local councillors, community groups, schools, youth groups and of course the voluntary sector, to ensure the development of good will and support of potential neighbours when selecting sites for accommodation. We appreciate that there are difficulties, but with good will they can usually be overcome.
Jointly planned development of mental handicap services has not yet been as widespread as we would like to see. But despite problems of organisational and geographical boundaries there are, as with mental illness services, some good examples where co-operation between all concerned really does

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produce the co-ordinated mental handicap service we want to see. Much depends on individual determination and good will to get together to make the machinery work effectively.
The movement to community care has made it even more essential that we recognise the importance of training and staff developments at all levels. This point was mentioned by the noble Lady, Lady Kinloss. With this in mind, we have taken steps to emphasise both the scale and urgency of the training development required to keep pace with the development of services. Bodies with statutory training responsibilities have recognised that shift in service patterns over a number of years and the effect that this must have both on professional practice and attitudes and the skills of a wide range of staff and management. Officials have been working closely with these and other bodies concerned in staff training. We want to improve training and in particular to encourage the shared training of NHS and local authority staff for work in the community, and central funding has helped in this progress.
How services can develop in any one area will primarily depend on the relevant health and local authorities making the best use of resources available to them. However, there are ways in which central government can make a direct contribution to the development of community care projects. I have already mentioned our training grants and, as many noble Lords will know, we have made a substantial financial contribution to moving mentally handicapped children out of hospital into more suitable forms of care.
Some people with a mental handicap also show very severely disturbed behaviour, or they may be mentally ill or need care in conditions of some degree of security. These people with special needs require special solutions, and officials have been studying how different authorities are meeting these needs. A guidance document for planners is being prepared which the Department of Health hopes to issue next year.
I am now some way through my speech and have highlighted a large number of central government initiatives to boost community care, all of which are currently under way. Some noble Lords—not least the noble Lords, Lord Carter, Lord Rea and Lord Taylor of Gryfe—have suggested that the Government are dragging their heels on community care, especially in relation to Sir Roy Griffiths' report. I would argue on the contrary that what I have described is a constant record of commitment, activity and progress. Of course we look to the future, and Sir Roy's report will assist Ministers in planning further action. Ministers are studying the report and the many and varied responses to it with great attention. It has moved the ongoing debate about community care forward significantly and stimulated thinking among all organisations and professions concerned with the delivery of care. I can reaffirm our commitment to bring forward our own proposals following this period of scrutiny. The views put forward in the debate will be taken into account in framing those proposals.
Lord Ennals: My Lords, can the Minister give some idea of when we are likely to have a reply?
The Earl of Arran: My Lords, I think that that would be unwise because I cannot say with absolute assurance.
I know that this response will disappoint many noble Lords who may have hoped for our intentions to be revealed tonight. The Government are aware of concern, not least in your Lordships' House, that action should not be unduly delayed. Equally, however, in such a complex and challenging area concerned with the welfare of some of the most vulnerable and needy people in society it is right that we take sufficient time to find the right answers before embarking on a major programme of action. For that we make no apologies. Precipitate action not backed up by careful thought and scrutiny would not be in anybody's interests, least of all that of the individual clients or patient, but let me emphasise again that government proposals for further improvements in community care will be forthcoming in due course.
I have spoken of the action that central government already have in hand. It is equally important for health and local authorities to continue to build on the progress made so far at the operational level. We remain firmly of the view that there is scope for progress within existing arrangements, as the many successful and imaginative projects developed locally in the past few years illustrate. Local authority resources devoted to community care increased by over 26 per cent. in real terms between 1978–79 and 1986–87 to help fuel those developments.
We acknowledge that progress has not been uniformly good and that there is a major challenge for all concerned with these services to ensure that the resources devoted to them are managed in the most efficient and effective way, but there is certainly no reason to despair of making progress within existing structures. Health and local authorities can work within them to make significant improvements in services locally and suggestions of planning blight do a disservice to all those currently involved in developing such schemes.
What else can central government do to help? There is no magic wand that we can wave, but we can encourage. The regional review system enables the NHS management board and Ministers to discuss with regional health authorities points of concern on planning or the provision of services and to set objectives for action. Good collaboration is one of the points for which we look out, and we tackle regions in the review process if there seem to be problems.
Before I conclude, noble Lords are of course aware that financial assistance is available through the income support and housing benefit schemes and community care grants under the social fund and the independent living fund. These schemes are means-tested, but all recognise the extra needs of sick and disabled people.
The noble Countess, Lady Mar, spoke of the difficulties that patients have in claiming social security. Patients will usually be receiving benefit

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while in hospital. This will normally be increased on discharge. We appreciate that some individuals may find it difficult to claim that benefit, but the new system of benefits introduced last April was intended to be easier to understand and administer.
The noble and learned Lord, Lord McCluskey, asked whether there are likely to be exemptions from payment of the community charge for persons suffering mental illness. I understand that there will be exemptions for people in residential care homes and nursing homes. Exemption for vulnerable groups in other types of accommodation is a matter receiving attention. I am unable to give further details on this occasion.
Baroness Seear: My Lords, does the Minister include in the list of exemptions people who are being looked after with great difficulty by their families in their own homes? If the Government do not give more assistance soon and if, on top of everything else, such people have to find the poll tax to pay for those whom they are looking after, they will break, and it could well be the last straw.
Lord McCluskey: My Lords, will the Minister consider the fact that the relevant government legislation is the 1988 Act, which excludes these very people? Are the Government giving consideration to amending that Act on this point?
The Earl of Arran: My Lords, I understand the noble Baroness's point. I am not certain whether the specific category of people she mentions is included in the exemptions. I undertake to find out and let her know in writing.
In conclusion, I am bound to say that the Government remain committed to the development of locally based services and are constantly reviewing how development can best be achieved. Having heard what I have said about all the ways in which we are actively improving services, care programmes for example, I hope that the noble Lord, Lord Ennals,
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will accept that needing to know more about regional services is not a smokescreen for inactivity. But there can never be room for complacency. The task of managing the resources devoted to the mental health service is a major challenge for management and professionals at all levels and we must ensure that the right services reach those who need them most.
Lord McCluskey: My Lords, the noble Earl has sat down without using up all his time. Will he respond to the third question of which I gave him written notice, about prescription costs?
The Earl of Arran: My Lords, the noble and learned Lord, Lord McCluskey, will realise that we are very short of time. I shall respond to his point but I am equally anxious that the noble Lord, Lord Carter, should also be able to speak.
Lord Carter: My Lords, I am extremely grateful to all noble Lords who have taken part in this wide-ranging debate; it has certainly revealed the size of the problem. I am grateful to the Minister for the comprehensive way in which he replied, but he will understand my disappointment with his use of such phrases as "in due course", "to move forward" and "an on-going debate". They are not much help when we had hoped to have the assurance of the Government that they were responding to the Griffiths report.
My Lords, with that in mind, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

British Railways (Penalty Fares) Bill [H.L.]
Reported from the Unopposed Bill Committee with amendments.
House adjourned at ten minutes before nine o'clock.

  LONDON GROUNDWATER LEVELS
  LONDON GROUNDWATER LEVELS
  SEWAGE TREATMENT WORKS: IMPROVEMENTS
  SEWAGE TREATMENT WORKS: IMPROVEMENTS
  SOUND RECORDINGS: MMC REPORT ON COLLECTIVE LICENSING
  SOUND RECORDINGS: MMC REPORT ON COLLECTIVE LICENSING
  MMC REFERENCES: SHARE PURCHASE PROHIBITION
  MMC REFERENCES: SHARE PURCHASE PROHIBITION
  SHARES: DISCLOSURE OF INTEREST
  SHARES: DISCLOSURE OF INTEREST