Sitting of 30 June 1988

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

  EASTBOURNE HARBOUR BILL [Lords]
  Order for Third Reading read.
  Queen's Consent, on behalf of the Crown, signified.
  Read the Third time, and passed, without amendment.

  LONDON REGIONAL TRANSPORT BILL (By Order)
  Order read for resuming adjourned debate on Question [10 December], That the Bill be now considered.
  Debate further adjourned till Thursday 7 July.

  TEIGNMOUTH QUAY COMPANY BILL (By Order)
  YORK CITY COUNCIL. BILL [Lords] (By Order)
  CARDIFF BAY BARRAGE BILL (By Order)
  FALMOUTH CONTAINER TERMINAL BILL (By Order)
  NEWCASTLE UPON TYNE TOWN MOOR BILL [Lords] (By Order)
  PORT OF TYNE BILL [Lords] (By Order)
  AVON LIGHT RAIL TRANSIT BILL [Lords] (By Order)
  Orders for Second Reading read.
  To be read a Second time on Thursday 7 July.

  NORTH KILLINGHOLME CARGO TERMINAL BILL (By Order)
  Order read for resuming adjourned debate on Question [22 June], That the Bill be now considered.
  Debate further adjourned till Monday 4 July, at Seven o'clock.

Oral Answers to Questions
  NORTHERN IRELAND

    Anglo-Irish Agreement
    Sir Michael McNair-Wilson: To ask the Secretary of State for Northern Ireland what discussions he has had with his opposite number in the Republic on amending the Anglo-Irish Agreement to enable Northern Ireland politicians to have a greater say in the governance of the Province.
    The Secretary of State for Northern Ireland (Mr. Tom King): None, Sir. The agreement is no obstacle to such a development.
    Sir Michael McNair-Wilson: In his speech last night my right hon. Friend said that a devolved settlement would have major implications for the agreement, and the greater the devolution the wider the impact. In his use of the word "devolution," does my right hon. Friend restrict himself entirely to the concept of legislative devolution, or would any form of devolution create an Ulster interface to the agreement?
    Mr. King: I referred to what I thought was the desirable ultimate objective. I am sure that my hon. Friend will have noticed that I used the phrase "to or towards devolution." In other words, I am certainly prepared to consider any proposals and alternatives that any hon. Members or others may wish to put forward.
    Mr. Molyneaux: In the light of the views expressed in yesterday's debate by the spokesman for the official Opposition, the hon. Member for Kingston upon Hull, North (Mr. McNamara), and others who participated in the debate, is the Secretary of State prepared to consider, as an alternative to the present agreement, a new agreement that would achieve the aims and objectives of the earlier failed agreement, namely, peace, stability and reconciliation?
    Mr. King: This is an issue that the right hon. Gentleman and I have discussed on a number of occasions, so he knows the answer. My hon. Friend the Under-Secretary of State for Northern Ireland, the hon. Member for Peterborough (Dr. Mawhinney), reiterated it when he replied to the debate. The right hon. Gentleman must not seek to impose conditions on any discussions that might occur, as my hon. Friend said to the hon. Member for Belfast, East, (Mr. Robinson) last night. I have made it absolutely clear that I am prepared to enter into discussions with right hon. and hon. Members, without conditions.
    Mr. Gow: Will my right hon. Friend address his mind once again to the policy that was set out by the late Airey Neave in the Conservative party manifesto of 1979, when the Conservative party committed itself, in the absence of devolved government, to setting up a regional council, or councils, with widely devolved powers over local matters? Mr. Neave and our party envisaged, not that there would be an Assembly with legislative powers, but that we should

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    govern Northern Ireland more closely in line with the way in which we govern Scotland, England and Wales. Will my right hon. Friend look at that again?
    Mr. King: I have made clear to my hon. Friend and others what I think is the desirable objective. However, I have also made it clear that I wish to enter into discussions with the parties and other interested groups in Northern Ireland to consider the basis on which it might be possible to start the process of working and of taking some responsibility together for the affairs of the Province. To repeat what I said yesterday, it is no good people standing at a distance and saying that they are being treated as a colony, but refusing to make any effort to see how they might take greater responsibility for their own affairs.
    Mr. Hume: Will the Secretary of State confirm that no party in Northern Ireland is excluded from the Anglo-Irish process? Apart from a party's ability to raise matters in the House, can it approach the Government at any time to have matters placed on the agenda of the Anglo-Irish Conference?
    Mr. King: The mistake of the Unionist parties is to elevate the conference as though it were a method for the governance of Northern Ireland. That is a phrase that I corrected in the question asked by my hon. Friend the Member for Newbury (Sir M. McNair-Wilson). The right hon. Member for Lagan Valley (Mr. Molyneaux) completely misrepresented the position last night and implied that there would be joint authority. It is a fair opportunity for the Irish Government to put forward views and proposals. That opportunity is more peculiarly available to every hon. Member. I find it difficult to accept any criticism from people who singularly fail to use all the unique opportunities that are more immediately and directly available to them than are available to the Irish Government.
    Mr. Bill Walker: Does my right hon. Friend accept that any proposals for a devolved legislative Assembly in Ulster are bound to have an impact across the Irish sea in Scotland? The Government should tread with some care in this matter, as we have seats in Scotland that are still at risk.
    Mr. King: It may disappoint or appal my hon. Friend to discover that I was born in Glasgow and therefore have some understanding of Scottish issues. Having been born in Glasgow of a Welsh mother and an English father, and being Secretary of State for Northern Ireland, I am acutely aware of the differences in the United Kingdom.

    Security
    Mr. Livingstone: To ask the Secretary of State for Northern Ireland if he will make a statement on the current security situation in Northern Ireland.
    Mr. Ron Brown: To ask the Secretary of State for Northern Ireland if he will make a statement on the current security situation in Northern Ireland.
    Mr. Tom King: Since I last answered questions in the House on 26 May 1988 nine people have been killed in Northern Ireland. These deaths include the murder of a full-time UDR soldier by the Provisional IRA, the murder of two civilians in Belfast, and the murder by the Provisional IRA of six off-duty soldiers at Lisburn on 15
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    June. The Provisional IRA claimed responsibility for the death of one of the civilians and, while no organisation has claimed responsibility for the other death, it is believed to have been the work of a Loyalist paramilitary group.
    The efforts of the security forces are continuing to yield substantial encouraging results. Since the beginning of the year, 182 people have been charged with serious offences, including 11 with murder and 10 with attempted murder. A total of 337 weapons, 72,000 rounds of ammunition and 4,100 lb of explosives have been recovered in Northern Ireland. I understand that the Garda Siochana has recovered some 220 weapons, 141,000 rounds of ammunition and 600 lb of commercial explosives.
    Mr. Livingstone: I join the Secretary of State in deploring the record of carnage that he read out. Does he agree, however, that Amnesty International's report undermines the legitimacy of the security forces if there is any suggestion that they operate outside the law? Therefore, will he investigate the statement by the RUC in Belfast Crown court that it had decided neither to question nor to charge Mr. R. Jackson, a Loyalist paramilitary who was involved in the murder of Mr. William Strathearn, about using a gun supplied by two members of the RUC who are currently serving life imprisonment for their part in the crime? Can he justify two members of the RUC being in prison for life while the third person who took part in the offence was not charged? For once, will he not say that if I have any evidence I should give it to the authorities, because this comes from the RUC?
    Mr. King: I should need to study the hon. Gentleman's question very carefully. I should like to know to what period it refers. I am bound to say that if there is evidence to that effect it must be dealt with in the proper way and should be submitted.
    Rev. Ian Paisley: Will the right hon. Gentleman make a statement about the shooting down of a helicopter in Northern Ireland? Is he aware that an Army officer appeared on television and told the people of Northern Ireland that Russia was put out of Afghanistan by the same procedure—the shooting down of helicopters—and that, if it continued, British policy in Northern Ireland would have to change? Will he comment on those remarks made by a British Army officer on the night after the shooting down took place?
    Mr. King: I did not see that broadcast or hear that particular comment. Any development of a threat to helicopters would be a serious matter and involve alterations to the operating practices of the security forces. As we know, in Northern Ireland the security forces will, with their skill and courage, adapt and make the necessary changes to their operating procedures to combat whatever may be the assaults and devices of the terrorists. If, after 20 years, the terrorists do not know that and have not realised that there is no military way by which they can win this campaign, I wonder whether they will ever learn.
    Mr. Brown: We all condemn violence, but is there not still a case for the phased withdrawal of British troops? I suggest the setting up of workers' defence groups, based on the trade unions, for the defence of the community and to counter sectarianism. That may be anathema to the Tory party and the Secretary of State, but will he at least give us

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    his views on that suggestion, which is important to individuals who believe that class issues still prevail in that troubled part of the United Kingdom?
    Mr. King: British troops are in Northern Ireland to protect the community from terrorism, from whichever quarter it may come. They will remain there as long as the community faces such a threat. The people who make necessary the presence of the troops are the people who conduct the terrorist campaign. They are, in a real sense, the "troops in" movement for Northern Ireland, because that is why the troops are there. I do not begin to support the suggestion that trade union groups could provide a security presence, but I should not like to let pass the opportunity to pay tribute to what trade unions have done in Northern Ireland in standing against sectarianism. The whole Province is in their debt.
    Mr. Hayes: Does my right hon. Friend agree that, despite the courage and dedication of Sir John Hermon, last night's vote has not helped morale in the RUC? Therefore, is it not vital to get this whole issue of the disciplinary proceedings over the Stalker affair out of the way as quickly as possible?
    Mr. King: I entirely agree with my hon. Friend. There is the implication, in connection with the Stalker-Sampson affair and the original shooting, that no action was taken in pursuit of the matter. As we know, four members of the RUC were charged with murder. There has been a massive reorganisation of the RUC, and a significant number of changes have been made, some of them way back in 1983. That shows how long ago some of these issues were being dealt with. I also agree that it is desirable that these matters are finally resolved, and, if disciplinary charges are to be made, that they are dealt with. There may be an announcement shortly in respect of the recommendations made by Mr. Charles Kelly, which are now with the Chief Constable.
    Mr. Maginnis: Will the Secretary of State join me and other hon. Members in wishing a speedy recovery to 14-year-old Gillian Latimer, who was so tragically and callously injured by the IRA in my constituency earlier this week? Will he also commend the courage of the driver of the school bus, who brought it to a halt so quickly after being thrown out of his seat that other children were not injured in the crash that should have ensued? At a time when the IRA is plunging to even greater depths, how can the Minister justify the denial of resources to the RUC in the frontier areas, where some of the police stations have cut their hours to 50 per cent. of what they were a few months ago?
    Mr. King: The whole House will wish to endorse the hon. Gentleman's opening comments. As he knows, I commented about our feelings for Gillian Latimer and her school friends and on the courage of the driver on that occasion.
    On the second matter, we have, of course, made it absolutely clear that law and order and the fight against terrorism are top priorities in our expenditure considerations and that we have significantly increased the resources in that area. If problems arise in particular areas I should like to consider them, but I do not think that I should comment on those matters on the Floor of the House.
    Mr. Marlow: In view of the point put to my right hon. Friend by the hon. Member for Brent, East (Mr. Livingstone) and other Labour Members, will my right hon. Friend confirm that the IRA is conducting more than one campaign—not only a campaign of terrorism, but a campaign to undermine the credibility of British justice? Would it not be a matter of some shame and disgrace if Labour Members were to lend themselves, either advertently or inadvertently., to such a campaign?
    Mr. King: I entirely agree with my hon. Friend that part of the IRA campaign is to look for people who will repeat various allegations and distortions that it wishes to propagate. Looking at the latest figures, I should like to see some of that enthusiasm for civil rights, personal liberty and freedom addressed to the issue of the punishment shootings and beatings that are being conducted by some people at present. Last year more than 200 young people and others in Northern Ireland were involved in knee-capping and beatings of one sort or another of the most violent and vicious kind.
    Mr. McNamara: I am sure that the Secretary of State will agree that we all want confidence in the security forces. We welcome the figures that he has given relating to arms finds, and so on, but is he able to tell us about the new appointments to the Police Authority? We know why the people involved are not named—I do not challenge that—but can he tell us how many of the new members were drawn from the minority community, how many of those not reappointed voted to appoint an investigating officer to inquire further into Mr. Sampson's allegations about the conduct of the investigation into certain matters arising from two of the shootings and an alleged lack of assistance to the Stalker-Sampson inquiry team. and, finally, how many of those reappointed were from the minority community and how many of those who were reappointed voted for the defeated proposal?
    Mr. King: On the latter point, I am not able to give the hon. Gentleman the information that he seeks. That is, of course, a matter for the Police Authority and, in its very full statement, it made clear many of the considerations that it had in mind.
    On the hon. Gentleman's second point, although he understands that it is not the practice, for obvious reasons, to disclose the names of those concerned with the new Police Authority, which took office yesterday, I am satisfied that it represents a good cross-section of people in the community and that there is a substantial representation from the minority community.

    NHS (Anniversary)
    Mr. Fatchett: To ask the Secretary of State for Northern Ireland if he has any plans to celebrate the 40th anniversary of the National Health Service; and if he will make a statement on the future of health care in Northern Ireland.
    The Parliamentary Under-Secretary of State for Northern Ireland (Mr. Richard Needham): Any plans to celebrate the 40th anniversary of the National Health Service in Northern Ireland will be left to individual health boards to decide. As regards the future of health care in Northern Ireland, that is as set out in the "Regional Strategy for the Health and Personal Social Services 1987–92", published in August 1987.
    Mr. Fatchett: Will the Minister take this opportunity to thank the health workers of Northern Ireland for their dedication and courage over recent years? Will he also take this opportunity of looking again at the cuts in the budget for the Northern health board and the fact that the board is underfunded in terms of health spending? Will he also give the House and the people of Northern Ireland a commitment that he will set up a public inquiry to consider those cuts?
    Mr. Needham: I join the hon. Gentleman in paying tribute to the health workers of Northern Ireland. They themselves have something to celebrate. In the seven years to December 1986, the number of employees in the Health Service in Northern Ireland increased by 9 per cent., hospital-related services by 10 per cent., health centres by over 50 per cent., health visiting services by 14 per cent. and home nursing services by 40 per cent. There has been a large increase in health spending over the past 10 years. I cannot give the hon. Gentleman a guarantee about setting up a public inquiry for the Northern health board over its proposals for hospital closures. This has been debated thoroughly throughout Northern Ireland over many months. There has been every opportunity—an opportunity that they have not taken—for the leaders of the trade unions to come and discuss it with me. I believe that the Northern health board's strategy for rationalising acute care and community hospitals in Northern Ireland will benefit all the people in its area.
    Mr. McGrady: Will the Minister join me in expressing grave concern about the health of the elderly and the disabled, who are being deprived of basic home-help and telephone connection facilities because of the cuts that are being imposed on the health boards? Many of these people live in isolated rural communities and their only contact with others is by means of the telephone or through the home-help service. Will the Minister take the necessary steps to provide additional finance to reinstate these greatly needed services?
    Mr. Needham: The hon. Gentleman knows that care in the community is a main plank of our strategy in Northern Ireland. I cannot accept that the rationalisation that is taking place in the Health Service has led to a diminution of care, although the hon. Gentleman is right to say that there are fewer home helps than there were. However, in proportionate terms there are still roughly two or three times as many in Northern Ireland as are available in the rest of the country. Much of the service that is provided by them is being assisted through an increased number of health centres and through residential accommodation and the voluntary sector. We shall continue to build on services in the community.
    Rev. William McCrea: Will the Minister accept from me that many of the members of health boards in Northern Ireland are nominated and are not representative of the people? The Northern health board's strategy for health services and hospital provision in future is not the one that is desired and does not reflect the will of the general public. Will the Minister institute an inquiry immediately into the basis of the board's decisions, which will affect the major hospitals in the area?
    Mr. Needham: I shall not. I do not believe that the representatives of the district councils and the members of the Northern health board can agree among themselves on
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    what they want. The mix of the board—it is a large body with representatives of the entire community within the area that it covers—is extremely representative of the public in the area. I believe that it has come to the right decisions in its strategic proposals.

    Education
    Mr. Martlew: To ask the Secretary of State for Northern Ireland what representations he has received recently from interest groups in the education field.
    The Parliamentary Under-Secretary of State for Northern Ireland (Dr. Brian Mawhinney): Since Easter this year I have received many representations, written and oral, on a wide range of education topics. These include provision in schools, school development proposals, cross-community contact schemes, youth service review and funding for arts, museums, sport and community services.
    Mr. Martlew: Will the Minister confirm that at a recent meeting with representatives of the parents' action group for education—they had come to see him about extra cover for absentee teachers—he shouted at them and thumped the table when they refused to agree with him on where cuts should be imposed in the education service to enable the extra cover to be made available? If that is true, will the hon. Gentleman take the opportunity to apologise for his childish behaviour?
    Dr. Mawhinney: Of course it is not true. I am neither a shouter nor a table thumper. I had a constructive discussion with the representatives of the parents' group. They made clear their concern about substitute cover in primary schools, especially in P1 and P2. I undertook to consider their views, along with others that have been expressed, in the review that we are conducting, as promised in the management-union negotiated settlement that was arrived at last summer.
    Sir John Biggs-Davison: What representations has my hon. Friend received from the Catholic hierarchy about the proposed education reform, and what has been done to remove its misgivings?
    Dr. Mawhinney: I have received representations from the leaders of the Church and from the Council for Catholic Maintained Schools. Representatives from both organisations will see me in the near future to discuss their representations. Representatives of the Church leaders will see my right hon. Friend the Secretary of State for Northern Ireland, and I will be in attendance.
    Mr. McCusker: Will the Minister confirm that one of the more significant interest groups in the educational affairs of Northern Ireland is the Government of the Irish Republic, using the offices of the Anglo-Irish Conference, where they purport to represent what I think is called the Nationalist community in Northern Ireland? As the Minister can ignore and deliberately take no account of the wishes of the remainder of the people in Northern Ireland, but is under an obligation to work thoroughly to reach agreement with the representatives of the Government of the Irish Republic, how does he intend to work in that regard?
    Dr. Mawhinney: The answer to the first part of the hon. Gentleman's question is no. The answer to the second part

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    of his question is that with all groups in Northern Ireland, whether they be from the Unionist or Nationalist communities, I will seek to find as broad an area of support as possible to achieve higher education standards and greater parental choice and involvement in the education process. I hope that it will not be too long before the hon. Gentleman lets me have his views so that I may take those into account in the decision-making process.
    Ms. Mowlam: What is the Minister's response to the parents and teachers at Skegoneill primary school in north Belfast, who see the Minister allowing the board to close their school, which by September will be fully integrated in terms of student numbers, while at the same time the Minister has agreed to the building of a new Catholic school 100 yds up the same road? The Minister has told us that integrated education is the way forward. Why has he made this decision? Does the decision stem from insensitivity, arrogance or incompetence? What is the reason for it?
    Dr. Mawhinney: The reason is that the Skegoneill primary school was not viable. Whatever the composition of the school force, it was the test of viability that had to be applied to granting approval to the proposals from the education and library board. I noticed that the hon. Lady did not say that within a matter of days of the closure of Skegoneill I accepted Hazelwood college—not far from Skegoneill—into maintained status. I am disappointed that the hon. Lady has not welcomed that decision.
    Rev. Ian Paisley: Will the Minister reaffirm in the House that it is still the iniquitous policy of his Department to discriminate entirely against independent Protestant schools and tell them that they will receive no money whatsoever from his Department?
    Dr. Mawhinney: If the hon. Gentleman is referring to the schools that have a relationship with his denomination, it is my understanding that those schools have never made application for funds from my Department. I further understand that it is the view of his party and Church that they would not make such an application as a matter of principle. If the hon. Gentleman is telling me otherwise, I would be very happy to discuss the matter with him.
    Mr. Mallon: Is the Minister aware of the great concern that exists about his proposal, or suggestion, that the Irish language should not be a foundation subject? Will he take steps to ensure that that very important part of his tradition and mine and his cultural background and mine is included as a core foundation subject in the curriculum?
    Dr. Mawhinney: I am aware of the concern about the Irish language. That concern has been reflected to me by organisations, including the hon. Gentleman's party, and I thank him for that, and by a number of individuals. It has also been reflected by the Catholic Church. We are looking at all the proposals. However, I join the hon. Gentleman in affirming that it is important that the children of Northern Ireland should have some understanding of their cultural heritage and of the diversity of the cultural heritage that applies in the Province.

    Extradition
    Mr. Alton: To ask the Secretary of State for Northern Ireland what recent discussions he has had with the Government of the Irish Republic concerning British-Irish extradition arrangements.
    Mr. Tom King: At the Intergovernmental Conference on 17 June we discussed the serious difficulties which had arisen in recent extradition cases and we reaffirmed our joint determination to ensure effective extradition arrangements.
    Mr. Alton: Although in theory the district courts in this country and in Ireland should dispense justice without fear or favour, is it not inevitable that in the district courts magistrates will be in the greatest fear of the consequences of taking extradition action against members of the IRA? Does the Minister not welcome the Dail's decision on Tuesday that all such cases should in future be dealt with in the High Court? Will he also say whether he has raised with the Irish Government why it was that McVeigh was not kept in custody once it was discovered that the necessary identification was not to hand to allow his commitment for extradition to this country?
    Mr. King: As I made clear in my original answer, we had a full discussion with Irish Ministers on this matter, and it is clear that the Irish Government are very concerned about the events that occurred. The hon. Gentleman himself referred to the debate in the Dail. The Irish Minister of Justice made a statement in the Dail making it clear that the Irish Government will appeal against the decision of the district judge. I understand that the Irish Government are also sympathetic to the idea of making changes of the kind that the hon. Gentleman mentioned.
    Mr. Duffy: Given that Mr. Justice Ruane acted perfectly correctly and within the law, given that in recent years Law Officers from both Britain and Ireland have failed to make sensitive extradition warrants impermeable to challenge, and given the common practice of an officer from the jurisdiction seeking extradition to provide identification in court, why were not those steps and every other step taken in the McVeigh case?
    Mr. King: That is primarily a matter for my right hon. and learned Friend the Attorney-General. However, the hon. Gentleman will know that in the McVeigh case the procedure which did not lead to a successful completion of the extradition application arose under the 1965 legislation, and that the court's interpretation and approach had not been expected. The greatest efforts had been made by my right hon. and learned Friend and by the British authorities to comply with all the Irish authorities' requirements. The Irish authorities themselves recognised that and shared to the full our concern about the outcome of that case.
    Mr. William Ross: Will the Secretary of State confirm that whenever there is a request from the Dublin authorities for the extradition of persons from Northern Ireland it is honoured, regardless of the nature of the crime involved? Likewise, when there are extraditions to Northern Ireland, to Great Britain, of persons who are living in the Irish Republic, for what is usually called ordinary crime, there is also no problem. Problems with

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    extradition cases arise only when those to be extradited are accused of terrorist crime. Will the Secretary of State comment on that point?
    Mr. King: My concern—and it is not necessarily implicit in the way in which the hon. Member puts his question—is to make extradition work. In the fight against terrorism it is vital to both countries that there is effective extradition, whatever the type of crime. It is unacceptable for that not to be the case, and we are determined to make it work.

    Labour Statistics
    Mr. Harry Barnes: To ask the Secretary of State for Northern Ireland whether he will make a statement on the latest unemployment figures for Northern Ireland.
    The Parliamentary Under-Secretary of State for Northern Ireland (Mr. Peter Viggers): The May unemployment figures, which are the latest available, are encouraging. They show a decrease of 2,113 from April and a decrease of 9,949 from May last year. The Government continue to give a high priority to the reduction of unemployment in Northern Ireland and provide a wide range of employment, training and enterprise measures for that purpose.
    Mr. Barnes: However one calculates the Northern Ireland unemployment figures, whether in absolute terms or in terms relative to England or with the past; whether one compares Protestant with Catholic unemployment, and Protestant unemployment is still higher than it is in this country—or whether one uses the Government's new statistical techniques or traditional techniques, the fact remains that unemployment in Northern Ireland is a disgrace. It fuels sectarianism and paramilitarism. What will the Government do, and how will the privatisation of Harland and Wolff assist in that situation?
    Mr. Viggers: I see no direct link between privatisation and unemployment. As to the hon. Gentleman's other point, the Government operate a wide range of measures in Northern Ireland to promote industry and to organise training and employment. They are easily the most generous in the United Kingdom and they will continue. As to the disparity in unemployment between Protestants and Catholics, there is to be a debate on the Government's White Paper tomorrow. We are committed to equality of employment opportunities and the hon. Gentleman will learn from tomorrow's debate the firm proposals that we intend bringing forward on that score.
    Mr. Peter Robinson: In view of speculation in the morning newspapers, will the Minister say whether plans for the privatisation of Harland and Wolff are to be announced in the House, or outside? If the Government have such plans, what attempts has the Minister made to ensure that there is job security, to convince the shipyard that there will be intervention funding and to say whether there will be access to naval orders?
    Mr. Viggers: The number of people employed in any company should depend on efficiency and profitability, not on public or private ownership. I said in my response to the Adjournment debate on 27 May that if there were to be an expression of interest in the acquisition of Harland and Wolff the Government would take it
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    seriously. An expression of interest in the acquisition of Harland and Wolff has now come forward from Tikkoo Cruise Line Ltd. The Government will consider that and any proposals from any other parties that might lead to the privatisation of the company.
    Mr. Jim Marshall: Since, according to press speculation—again, it is press speculation—Mr. Tikkoo has denied that he has any interest whatever in being a shipbuilder, will the Minister state categorically whether the Government have approached Mr. Tikkoo, or whether Mr. Tikkoo has approached the Government.
    Mr. Viggers: I can assure the hon. Gentleman that I have met Mr. Tikkoo and discussed the proposal in outline. He is indeed interested in the acquisition of the yard.

    Examination Results
    Mr. Harry Greenway: To ask the Secretary of State for Northern Ireland what was the average number of O-level passes, grades A to C or CSE grade 1, per pupil in the last year for which statistics are available; and if he will make a statement.
    Dr. Mawhinney: The information is not available in the form requested. However, information from the school leavers survey shows that of all pupils who left school in 1985–86, 12·2 per cent. had a highest qualification of five or more O-levels. That compares with the 11·3 per cent. of school leavers in England and 10·4 per cent. in Wales. On the other hand, a relatively higher proportion of pupils in Northern Ireland left school with no qualifications.
    Mr. Greenway: Will my hon. Friend congratulate the schools in Northern Ireland on those results? However, is he satisfied that the GCSE is sufficiently rigorous to test those pupils at the top of the range and that adequate arrangements can be made to produce suitable new course work for those who will have to retake the GCSE examination, having failed it this summer?
    Dr. Mawhinney: I am grateful to my hon. Friend for his commendation of all the teachers in the Province, and I am sure that they too will be grateful. As in England and Wales, we have just had the first GCSE examinations and they have gone smoothly. I know that my hon. Friend will want to join me in expressing the hope that, arising out of the education reform consultation proposals, we shall be able to improve still further education standards in Northern Ireland, particularly for the almost one in four of our young people who leave school with no recognised qualification.
    Mr. Beggs: Will the Minister recognise that one reason why so many young people leave school in Northern Ireland with no qualification—the one in four to whom he referred—is that they are under pressure to take the first available job that comes along? Will he endeavour to take account of that and persuade his colleagues in the Northern Ireland Office that they too must seek every opportunity to attract and create real jobs so that there is real hope for our young people in schools and colleges?
    Dr. Mawhinney: Of course young people in Northern Ireland have employment problems. The hon. Gentleman will recall that in yesterday's debate there were expressions of appreciation for the work that successive Northern

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    Ireland Ministers have done to try to reduce the levels of unemployment in Northern Ireland. Nevertheless, it remains true that almost one in four of our young people are leaving school with no recognised qualifications, compared with about one in 10 in England and Wales. I know that that is a matter of anxiety for the hon. Gentleman, just as it is for me.

    Ministerial Discussions
    Mr. Hunter: To ask the Secretary of State for Northern Ireland when he will next have discussions with Ministers of the Republic of Ireland; and what matters will be discussed.
    Mr. Tom King: Another meeting of the Intergovernmental Conference is likely to be held shortly. A full agenda has not yet been prepared, but I expect security matters to be one of the items on it.
    Mr. Hunter: Will my right hon. Friend take the opportunity to reassure the House that in all his dealings with Ministers of the Irish Republic he stresses, not only the need for full cross-border co-operation with regard to security, but the nature of the threat posed by the IRA both to democracy and decency in the Republic of Ireland and to democracy and decency in the United Kingdom of Great Britain and Northern Ireland?
    Mr. King: There is no doubt that there is an awareness of the importance to both our countries of the closest co-operation. That has been so in the past, but has been increased since we learnt of the very substantial arms shipments that have reached the island of Ireland, bearing in mind the threat that they pose of greater terrors in Northern Ireland and the Republic.
    Mr. Flannery: When the Minister discusses security matters, will he discuss the decision of the Northern Ireland Police Authority, by a majority of only one, not to undertake prosecution or even to inquire into what the Chief Constable and his immediate subordinates have done about the shoot-to-kill policy? After what has happened and the ups and downs of the Stalker-Sampson report, is it not necessary that we have a judicial inquiry into precisely what has happened and why these people are not even going to be inquired into?
    Mr. King: That is manifestly untrue. The Police Authority made a very thorough inquiry indeed, conducted over two years and more by Deputy Chief Constable Stalker and Chief Constable Sampson. There has been the most exhaustive inquiry. What was being considered was merely whether an investigating officer should be appointed to conduct any further investigation.

  PRIME MINISTER

    Engagements
    Mr. Kennedy: To ask the Prime Minister if she will list her official engagements for Thursday 30 June.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in the House I shall be having further meetings later today.
    Mr. Kennedy: Given the reality of the Prime Minister's opposition to Scottish devolution and the perfectly proper wish in the United Kingdom Parliament of Members representing constituencies elsewhere than in Scotland to ask questions of Scottish Office Ministers, will the Prime Minister consult her right hon. Friend the Leader of the House and, without entering into any specific commitments or responses this afternoon, at least undertake to consider whether a practical way of easing the passage of Scottish questions in the House would be to have an additional period of Scottish questions within Scotland at the old Royal High school in Edinburgh, which would not reduce the ability of English, Welsh and Northern Irish Members to contribute on a regular basis, but would allow Scottish Members extra input to Scottish Question Time?
    The Prime Minister: No. We are a United Kingdom Parliament and our questions, as I know every Tuesday and Thursday, come from the whole of the United Kingdom.
    Mr. Anthony Coombs: Will my right hon. Friend confirm the results of the latest manpower survey on employment prospects? Will she indicate that not only is the employment situation in this country the best for 15 years but that the improvements in employment prospects in Scotland and south Wales are stronger than anywhere else in the United Kingdom? Will she confirm that this is ample evidence of the success of the Government's policies in making sure that prosperity returns, not just to the south-east, but to every region of the country?
    The Prime Minister: Yes, I gladly confirm that. Employment prospects are good. Growth has been good for over six years now. [Interruption.] Unemployment has been falling for 22 months in succession and 1·7 million jobs have been created since 1983. I do like to give full answers, especially to the Front Bench below the Gangway.
    Mr. Kinnock: Is the Prime Minister aware, in the wake of Monday's balance of payment figures, that if the balance of payments deficit in the second half of this year is anything like the deficit in the first half of this year we shall have an external deficit as large, in relation to our domestic product, as the American deficit is in relation to its domestic product? For an oil-rich, oil-exporting country, does that not show unique incompetence by the Government? Will the Prime Minister tell us what she will do to close the payments gap?
    The Prime Minister: The present current account deficit is being readily financed by an inflow of private sector capital, showing great confidence in other manufacturers in this country as a base for future manufacturing operations.
    Mr. Kinnock: If the confidence is so great and the inflow so ready, why must the Prime Minister inflict 9·5 per cent. interest rates on British industry and British home buyers?
    The Prime Minister: To keep downward pressure on inflation.
    Mr. Goodlad: Will my right hon. Friend continue her efforts to secure the Thyssen collection's ultimate location in this country? Will she seek to persuade Baron Thyssen

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    and the trustees to consider seriously the development at Battersea, which, like Alton Towers, will be visited in years to come by many millions of people every year?
    The Prime Minister: This is a unique and very valuable collection, and obviously we should like it to have its permanent home in this country. Certain proposals have been made, and it is for the trustees to decide whether they are acceptable. As my hon. Friend knows, a number of other countries have made proposals. It is for the trustees to make the final decision.
    Mr. Alfred Morris: How does the Prime Minister justify saying that there are no resources for full implementation of the Disabled Persons (Services, Consultation and Representation) Act 1986, which received all-party support, when she has stuffed so much gold into the mouths of the richest 5 per cent. of taxpayers? If she feels that her priorities are not inhumane, why can she not convince the Royal National Institute for the Blind, MENCAP, MIND, the Spastics Society and other major organisations of and for the disabled?
    The Prime Minister: As the right hon. Gentleman knows, expenditure on all the social services has gone up enormously. Since 1979, help for the disabled—about which the right hon. Gentleman is asking—has gone up by 80 per cent. in real terms.
    Mr. Hunter: To ask the Prime Minister if she will list her official engagements for Thursday 30 June.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Hunter: Will my right hon. Friend reflect on the wide popularity of the Criminal Justice Bill—not least because of the protection that it gives to child victims—and reflect further on the remarkable fact that the Opposition voted against it? Does that not make a mockery of their protestations on law and order and suggest that it is not only the extreme Left who live in a weird Disneyland of their own creation?
    The Prime Minister: The Opposition express sympathy for the victims of crime, but so often they vote against the measures that would enable us to protect people from crime. Not only the Criminal Justice Bill, but the Police and Criminal Evidence Act 1984, the Public Order Act 1986 and the Prevention of Terrorism Act 1974 all attracted an adverse vote from the Opposition.
    Mr. James Lamond: To ask the Prime Minister if she will list her official engagements for Thursday 30 June.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Lamond: Five years ago the Prime Minister was boasting with pleasure and pride about the balance of payments surplus and warning us against the extreme damage that high interest rates could do to our industrial production. Now that we are running the highest balance of payments deficit in the history of the country and interest rates are being increased every week, can she tell us whether she looks back over the past five years and thinks that we have made economic progress?
    The Prime Minister: We have made enormous progress, with inflation down, growth up, the number of new jobs being created considerably up, and the highest standard of
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    living that we have ever known and the best standard of social services that we have ever known. Yes, progress continues apace.
    Mr. Sumberg: Has my right hon. Friend noted the remarks of a distinguished constituent of mine, the deputy chairman of the BBC and former Cabinet Minister, Lord Barnett, that in the north-west of England there is an outlook of optimism and an air of confidence? Does that not endorse the success of the Government's economic and regional policies, and prove that when the Labour party claims to be listening it is effectively engaged in a dialogue of the deaf?
    The Prime Minister: Yes, I agree with that. There is a mood of optimism and confidence, different from when the Labour party was in power, as is manifest in the remarkable book, "Inside the Treasury" written by Lord Barnett. The book tells it all.
    Ms. Quin: To ask the Prime Minister if she will list her official engagements for Thursday 30 June.
    The Prime Minister: I refer the hon. Lady to the reply that I gave some moments ago.
    Ms. Quin: Has the Prime Minister found time to study the recently published report by the Low Pay Unit entitled "The 1988 Budget and the Poor"? Is she aware of the statement of its director that today's supertax payers in Britain are the poor, not the rich? Is she proud of the fact that the gap between rich and poor has widened so dramatically during her premiership? If not, what does she propose to do about it?
    The Prime Minister: The fact is that those on the lowest incomes have also gained from the growth of the economy and the creation of wealth. As everyone knows, wealth must be created before it can be distributed. Moreover, whereas before the reform of the social security system there was a group of people who, if they increased their pay, forfeited in other benefits more than 100 per cent. of what they gained in earnings, that gap has been greatly reduced.
    Mr. Hayward: Has my right hon. Friend compared the newspaper reports printed on Monday and the radio reports the Airbus accident in France on Sunday night with the Press reports that are now appearing? It seems that the British media are determined to talk down British technology and the fly-by-wire system of the A320. However, three days later, they are having to admit that they are wrong.
    The Prime Minister: I have seen the reports. It is always wiser to wait for a full investigation of these matters before one expresses conclusions.
    Mr. Andrew Welsh: To ask the Prime Minister if she will list her official engagements for Thursday 30 June.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Welsh: Will the Prime Minister pay as much attention to the views of the Scottish people, who are opposed to dumping nuclear waste, as to those of the Lord President of the Council, the right hon. Member for Colchester, South and Maldon (Mr. Wakeham), whose constituency was exempted from dumping such waste before the general election? Even if a local lord is willing

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    to be bought and sold for Nirex gold in Caithness, I assure her that the Scottish people will not be. I can guarantee massive sustained national opposition to dumping nuclear waste in Scotland. Does she listen to the people, or only to Cabinet Ministers?
    The Prime Minister: As the hon. Gentleman is aware, there are inquiries and studies into dumping nuclear waste. [Interruption.] If the hon. Gentleman is referring to imports of waste from other countries, obviously—[HON. MEMBERS: "No."] If he is not, I do not need to answer that question. If it is nuclear waste, the matter has already been subject to deep study and inquiry.
    Mr. Leigh: Further to the question of the right hon. Member for Islwyn (Mr. Kinnock) on deficits, will my right hon. Friend reflect on the fact that it is not she who is 12 points in deficit in the opinion polls? Could it be that that is because we do not have a chaotic defence policy, we are returning real prosperity to the people and we are not in hock to the block votes of trade unions?
    The Prime Minister: Yes, all that. I could not possibly have put it better myself.
    Mr. Fatchett: To ask the Prime Minister if she will list her official engagements for Thursday 30 June.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Fatchett: If, as the Prime Minister said in reply to my right hon. Friend the Member for Islwyn (Mr. Kinnock), the increase in interest rates is caused by inflation and she aims to act on inflation and not on the trade deficit, is there a level of trade deficit on which the Government would act and introduce measures?
    The Prime Minister: The prime objective is to keep inflation down, because to let it rise would be the very worst thing that one could do to the prospects of manufacturing industry, as most people realise. Interest rates are one of the instruments by which one keeps inflation down. As the hon. Gentleman will know, inflation is now lower than it was at any time under the last Labour Government.
    Mr. Harry Greenway: To ask the Prime Minister if she will list her official engagements for Thursday 30 June.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Greenway: Does my right hon. Friend remember the excellent contribution made to education by direct grant schools, and their destruction by the Labour Government between 1975 and 1979? Does she agree that grant-maintained schools, as envisaged in the Education Reform Bill, will make an admirable return to the principle, formerly upheld by the direct-grant schools, of making education available to children of all levels of ability? Will my right hon. Friend seek to ensure that the Lords amendment on the number of parents voting is overturned so that the decision on opting out can be taken by a simple majority?
    The Prime Minister: I agree that grant-maintained schools will give the kind of opportunity to many parents which they lost through the abolition of direct grant schools. We shall consider whether to apply to reverse their Lordships' amendment to the Bill when it returns to this House.
    Mr. Hume: In view of the Prime Minister's oft-expressed concern that there should be no hiding place in these islands for people who commit serious crimes, is she aware of legislation negotiated by her right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) with the Irish Government in 1974—the Civil Jurisdiction Act? Is she also aware that during the past few weeks, in the cases of two people wanted for serious crime in Dublin who were resident in Northern Ireland, the Irish authorities, instead of applying for extradition, supplied the evidence to the authorities in Northern Ireland, where they were tried, found guilty and convicted? Could she tell me why the Government do not use those same facilities, which are just as effective for achieving the objective, as extradition?
    The Prime Minister: Because, as the hon. Gentleman, I would have thought, would be the first to be aware, having others tried in the Republic is a very different proposition from what he said.

European Council (Hanover)
3.31 pm
The Prime Minister (Mrs. Margaret Thatcher): With permission, Mr. Speaker, I shall make a statement about the European Council in Hanover on 27–28 June, which I attended with my right hon. and learned Friend the Secretary of State for Foreign and Commonwealth Affairs.
The Council's detailed conclusions have been placed in the Library. The Council dealt with two main issues—progress towards completion of the single market by 1992; and arrangements for progressively closer economic and monetary co-operation in Europe.
First, on the single market—the Council was able to note that over one third of the measures in the European Commission's White Paper on the single market have now been agreed.
Agreements reached in recent weeks cover a number of subjects of particular interest to the United Kingdom—the full liberalisation of capital movements by 1990 for most EC countries, the mutual recognition of professional qualifications and the opening up of the road haulage market by progressive abolition of lorry quotas.
The Council agreed that priority should be given over the next 12 months to decisions on opening up public purchasing; further liberalisation of banking and other financial services; common standards for manufactured products; and registration of patents and trade marks throughout the Community.
The list does not include the harmonisation of indirect taxes, where the Council simply noted the further studies set in hand by Economic and Finance Ministers. The Government's view is that such harmonisation is not necessary for completion of the single market.
In considering the social aspects of the single market, the Council noted that removing the obstacles to growth offers the best prospects for creating jobs and spreading prosperity. It also encouraged better protection for health and safety at the workplace and easier access to training, on which a major initiative was taken during the United Kingdom presidency.
The Council reaffirmed the objective of enabling citizens of European Community countries to move freely throughout the Community but also stressed the need for effective measures to combat terrorism, drug abuse and organised crime. It is very satisfactory that there is growing recognition of the need for effective safeguards in this area.
Secondly, on economic and monetary co-operation, the Council agreed to establish a committee of the governors of the central banks appointed in their personal capacity. The President of the Commission will take the chair and there will also be a second Commission representative, Mr. Andriessen, and three additional members—Mr. Lamfalussy, director-general of the Bank for International Settlements, Mr. Boyer, president of the Banco Exterior of Spain, and Mr. Thygesen, professor of economics in Copenhagen.
The committee's task will be to study and propose concrete steps towards the progressive realisation of economic and monetary union. That goal was, of course, set out in the preamble to the Single European Act, which was approved by this House.
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The committee will report through the Council of Economic and Finance Ministers to the meeting of the European Council in Madrid next June.
The Council approved unanimously the reappointment of M. Jacques Delors as President of the Commission for a further two-year term from 1 January 1989.
Foreign Ministers discussed a number of political co-operation subjects, concentrating particularly on East-West relations, Afghanistan, the middle east, South Africa and Latin America. The Council conclusions on all these subjects are recorded in the communiqué.
Finally, we were able to note with satisfaction that the important decisions taken at the meeting of the European Council in February on budget discipline and agriculture have now been translated into binding legal instruments. Legislation to give effect to the new arrangements for financing the Community budget, including the new own resources decision, will be laid before the House tomorrow.
Following the Council, I had a meeting with the Taoiseach to discuss a number of current issues in Anglo-Irish relations. We reaffirmed our commitment to the Anglo-Irish Agreement and agreed to maintain, indeed strengthen, co-operation against terrorism.
The outcome of this Council was very satisfactory for the United Kingdom. We have confirmed that the way forward in Europe lies in the creation of wealth and jobs, as obstacles to trade and burdens on business are steadily removed. Thanks to this Government's policies, and the repsonse of those who work in industry and commerce, British firms will be particularly well placed to take advantage of the opportunities that the single market in Europe offers.
Mr. Neil Kinnock: I thank the Prime Minister for her statement. First, I welcome the reappointment of M. Jacques Delors as President of the European Commission and take this opportunity to congratulate him. I am sure that that view will carry strong support throughout the House. I commend the perception of M. Delors that conditions must be attached to the development of the single market by an insistence on what he calls the social dimension.
With that in mind, will the Prime Minister say whether her concept of the change to a single market concurs with the conclusion of the European Council that
"the internal market must be to the advantage of all of its citizens"
and that accordingly it is necessary to provide better protections for the health and safety of workers? Will the commitment that the Prime Minister made at the Council result, first, in the reversal of her Government's policy of weakening industrial and health and safety regulations and cutting the number of health and safety inspectors? Secondly, does that commitment mean the withdrawal of her resistance to the proposals of the President of the Commission to change Community law to foster workers' participation in decision making?
It is well known that the Prime Minister is in conflict with her Foreign Secretary and Chancellor of the Exchequer on the European monetary system and monetary union and that she has said that a European central bank is "not on the cards". However, as she has given in to the other members of the Council and agreed to the establishment of a study group under M. Delors, which will
"propose concrete steps leading to Monetary Union",

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and as it is obvious, as President Mitterrand has pointed out, that a central bank follows from monetary union, is it not clear that the Prime Minister is facing both ways?
What is the Prime Minister's real view? Is she committed to monetary union and what follows from it by virtue of her agreement with the European Council, or will she not accept monetary union and its consequences under any circumstances? Will she give an undertaking that in any event any report from the study group will be debated and determined in this House?
I note that the Prime Minister referred to tax harmonisation. She has, of course, given earlier undertakings about not extending VAT to some necessities. Will she take this opportunity to give an assurance that she will use the veto to prevent the extension of VAT to any items that are currently zero-rated?
On a subject that the right hon. Lady did not refer to but which is of considerable importance, has she resolved her widely publicised dispute with Delors over the subsidies that she wants to give British Aerospace to induce its takeover of Rover?
Twice in the past two weeks, in Toronto and Hanover, the Prime Minister resisted the efforts of partner Governments to insert a commitment to sanctions against apartheid. Is not that resistance further evidence of her appeasement of the apartheid system and of her deliberate refusal to support calls for change and clemency with effective action?
The Prime Minister: I shall try to answer the many questions that the right hon. Gentleman has asked me.
Of course the single market in the European Economic Community will benefit all its citizens, just as rising prosperity, which the single market gives us, benefits us all.
Our regulations on the health and safety of workers are greatly in advance of those of many other countries in the EC; many of them will have a long way to go to catch up with us. The social dimension also includes the training initiative that we agreed in London at the European Council in December 1986.
As for worker participation, we believe that those who get to the board of a company should do so on merit. That is by far the best way to do things. We do not agree with the old-fashioned, outdated approach that the Labour party adopts to these matters.
With regard to a European central bank, we have taken part of the Single European Act, which went through the House and which said that we would make progressive steps to the realisation of monetary union, and we have set up a group to consider that. Monetary union would be the first step, but progress towards it would not necessarily involve a single currency or a European central bank.
Long before European monetary union could be achieved, many other countries would have to come up to the level that we have reached. We have freedom of capital movement; most of them do not. We have no exchange control; most of them have. We have a variety of currencies in our bank reserves; most of them have not. We also deal in the ecu; most of them do not. So they have a long way before they go nearly as far as we have gone on these matters.
We have made our position on the veto on zero-rate VAT clear on many occasions. The recent change was due not to a change in the law but to an explanation of the 1977 directive by the European Court.
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Rover and British Aerospace are still under consideration in the Common Market by Mr. Sutherland, the relevant Commissioner. Assuming that that goes through, subsidies in future from the British Government would cease, unless they were given under regional development. That would be very much in line with what the Community would wish.
Sanctions on South Africa did not come up.
Mr. Terence L. Higgins: Does my right hon. Friend agree that the change in the own resources basis from a notional rate of VAT to gross national product is an important one? Is she aware of the recent recognition by the Treasury that the GNP statistics in this country are deficient, and that the Treasury has accepted the Treasury and Civil Service Select Committee's report that they should be reviewed, which is welcome? If that is so, it is even more important that the GNP figures for the other countries in the Community should also be checked arid shown to be reliable. If they are not, we could pay far more than we should. Will my right hon. Friend ensure that such a review is carried out throughout the Community?
The Prime Minister: I agree with my right hon. Friend that a change from a percentage of VAT to a percentage of GNP is significant. As he knows and has stated, we have set in hand an inquiry into our own statistics. Obviously, I cannot force the rest of the European Commission to do that, but we are making strenuous efforts to see that our statistics are as accurate as we can make them.
Mr. James Wallace: Did a few days in the company of other Community leaders and the Foreign Secretary make the Prime Minister any better disposed towards British membership of the exchange rate mechanism of the EMS? Will she explain to the House the apparent contrast between her reluctance for British membership of the EMS and her apparent unbounded enthusiasm when in Canada for encouraging Canadians to join a single unit with their larger neighbour, the United States?
The Prime Minister: When we were talking about Canada and the United States, we were talking about a trading agreement for a free trade area. That is an excellent arrangement and is the same as we are trying to achieve in the single market this side of the Atlantic. It was not a unity of monetary mechanism.
With regard to the exchange rate mechanism, as I pointed out in my previous reply, we have many advantages which many others who belong to the exchange rate mechanism do not have. Most other countries do not yet have freedom of capital movements, although Germany and Holland do. Most other countries still have exchange control. Those things have enabled them often to keep within the limits of an exchange rate mechanism. The question is, will they be able to do so when they have freedom of capital movement and have thus abolished exchange control? We shall have to wait until 1990.
Mr. Nicholas Soames: Is my right hon. Friend aware of the concern in the aviation industry that the liberalisation of air fares may not come about at the same time as the completion of the internal market? Will she assure the House that she will do all within her power

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to persuade other members of the Community to break the cartel on air fares and thus enable the charging of fully liberal air fares throughout the European Community?
The Prime Minister: Yes, we shall. As my hon. Friend knows, we have taken a lead in this matter and we shall continue to be active in trying to bring about the greater liberalisation of air fares to the advantage of the consumer.
Mrs. Ann Clwyd: Does the Prime Minister agree that she is misleading the House when she says that we have greater protection and safety laws for workers in this country than do many other EC countries—for example, West Germany? Does she agree that in the past nine years her Government have reversed many of the laws for which trade unions fought vigorously for over half a century? Will she reverse the legislation yet again to bring us more into line with other EC countries? Does she recall that similar provisions to those contained in the Baking Industry (Hours of Work) Act 1954, for which workers in this country fought for over 50 years, were enjoyed from the beginning of the century in West Germany? Does she further agree that her Government, in arguing the cause of equality, are equalising down rather than equalising up and that they have reversed those protections for workers in the baking industry? Will she promise to reconsider that?
The Prime Minister: I agree with the hon. Lady that Germany has very good health and safety legislation, as have a number of other countries in the Community. However, several countries still do not reach anything like the standards that we and Germany enjoy. Insofar as they are trying to use social cohesion, they are obviously trying to raise their standards to ours. I do not think that, we should change our standards because of any European regulations, as we already stand well in that regard.
Mr. Robert Adley: Is there not a certain divergence of view between the discussions that we all support, which were mentioned by my right hon. Friend, about the encouragement of free movement for goods and people within the EC, especially after 1992, and the intransigence which certain people appear to show towards the elimination of customs barriers, especially on Channel tunnel trains? Will my right hon. Friend note that there was broad agreement in the House during recent Transport questions that the Government must intervene to solve the problem? While she is looking at that, will she also bear in mind the problems that will arise because of the existing arrangements whereby trains in France will travel at an average speed of 145 mph and in England at 53 mph as a result of the Government's investment programmes? Will she look at that whole question?
The Prime Minister: The objective of freer movement of citizens and goods around the Community depends on removing the obstacles and dealing with the bureaucracy, the numbers of forms and the procedures. It must not result in removing all barriers, because then one would have no protection against crime, terrorism, the movement of drugs and many other things. There must still be barriers, which is why we must retain many of the barriers in Europe.
With regard to the Channel tunnel, my hon. Friend is asking for considerable extra investment on this side for an
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advanced train. On the other side, for other reasons, they have undertaken that investment. I can give no undertaking that we will make extra expenditure on that investment.
Mr. Paul Boateng: The right hon. Lady told the House that the issue of sanctions did not arise at the summit. Did she raise the issue of clemency for the Sharpeville Six? If not, why not? Is she prepared to go along with the West German Chancellor, Chancellor Kohl, and withdraw our ambassador if clemency is refused?
The Prime Minister: Clemency for the Sharpeville Six was in the Toronto communiqué, it is in the communiqué from Hanover and it was agreed by all member states. We pointed out that in South Africa all the legal steps have not yet been exhausted. Nevertheless, whatever the result, we asked for clemency. As the hon. Gentleman is aware, I asked President Botha for clemency—[HON. MEMBERS: "How?"] By the usual diplomatic channels. That is the appropriate way to do it. If the result is that the Sharpeville Six are condemned to death, we shall repeat our call for clemency.
Mr. Jonathan Aitken: I congratulate my right hon. Friend on her staunch defence of the rights of this sovereign Parliament and British sovereignty generally against the creeping federalism of the Commission over the central bank and the European common currency. Will she clarify what is meant by having the governors of the national central banks meeting in their personal capacities? That sounds like an elegantly phrased impotent formula that might be useful for employing the services of many EC officials, including Mr. Delors.
The Prime Minister: I understand my hon. Friend's point about governors of central banks. Should there be any change in the governorship of any central bank, the person who started on the committee will continue.
Dr. David Owen: When the European central bank is created and the House is dissolved—as the Prime Minister says it will be—may we assume that the Prime Minister will no longer be a Member of the House or that she will then leave? Will she confirm that, although a European currency cannot be created other than by unanimity under article 236 of the treaty, it is perfectly possible for the study that has just been set up to conclude that under the provisions of article 100A—the establishment and functioning of the internal market and the necessity to achieve free flow of capital movements and exchange—a European central bank could be created without unanimity?
The Prime Minister: The right hon. Gentleman may be correct in theory; I do not think that he is correct in any way in practice. He is being very optimistic if he thinks that, while he and I are Members of the House, there will be rapid movement even towards a single currency. He knows perfectly well that we would have to have a single economic policy to do that. Like many other people who discuss these matters in the European Community, he talks in grandiose terms but does not always take the necessary practical steps forward to enable us to get closer to a monetary unit.
Mr. Ian Taylor: Was my right hon. Friend able to discuss in Hanover such matters as company structure and law, which I understand will be one of the features of the Greek presidency? Was she able to say, quite firmly, that people in this country reject the rigid structure that was highlighted by Vredeling in the past? Will she put forward more flexible measures about worker-participation in companies, especially through employee shareholdings?
The Prime Minister: There was brief discussion about a European company structure, which, alongside the national structure, in some ways could be helpful to companies starting up in Europe. The structure proposed would be complicated, would consist of the maximum number of regulations and therefore would defeat its objective. My right hon. Friend and I pointed out that a European structure should consist of the minimum, not maximum, number of regulations to enable companies more easily to start up in Europe.
Mr. Tony Banks: It was good to see that the Prime Minister discussed Latin American affairs in Hanover. Why is it that she alone of the Heads of Government of the EC has refused to have a meeting with Vice-President Sergio Ramirez of Nicaragua when he comes to Europe later this month? Why is it that, despite the various statements that she and her Ministers make about the situation in Nicaragua, the Prime Minister remains wholly ignorant of the real situation, and no British Minister has been to Nicaragua? Why is it that the Prime Minister, in respect of Latin America, and particularly Nicaragua, remains a lickspittle for President Reagan?
The Prime Minister: The discussion on Latin America went on in a separate meeting of Foreign Ministers. I met Vice-President Ramirez on a previous occasion and we had a useful discussion, and I imagine that he does not think it necessary to have another.
Mr. Tony Banks: He asked for a meeting and was refused.
The Prime Minister: I am not going to see him, because, as the hon. Member knows, I have an extremely busy schedule. I am not alone in the view that I have taken towards that.
Mr. Robert Hicks: In view of my right hon. Friend's encouraging remarks about the development of the single market and her confirmation of the reappointment of the President of the Commission, can the House assume that this excellent precedent will mean the reappointment of Lord Cockfield as one of the United Kingdom commissioners, given the excellent preparatory work that he has undertaken in respect of the development of the single market?
The Prime Minister: My hon. Friend is fishing. No decision has yet been taken on the future of either of the commissioners who represent this country. A decision will be taken shortly.
Rev. Martin Smyth: We appreciated the reference in the communiqué to the conversation with the Prime Minister of the Irish Republic and the press reports that the Prime Minister had expressed concern about the level of security co-operation. Has the Prime
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Minister discovered what will be the difficulties in improving security co-operation? Why is it that, while some arms dumps have been found, there would seem to be far more reports of possible hideouts for dumps being found, including those passed by the Department of Agriculture in Dublin?
The Prime Minister: It was generally recognised that, whatever level of security co-operation we may have had, it needs strengthening now; that is why the emphasis, both in those talks and in the statement issued afterwards, was on strengthening that co-operation. I hope that that will please the hon. Gentleman.
Mr. Teddy Taylor: In the course of this satisfactory Council meeting, in which my right hon. Friend made an enormous contribution to common sense on major issues of policy, did she express any concern about the fact that the Agriculture Council should have just agreed a formula—riddled with green pound changes—which, according to the Commission, will stay within the agricultural guidelines agreed 13 weeks ago by the Council, after substantial but unspecified management economies? Is there anything that my right hon. Friend can do, after the success of this Council, to make sure that the solemn and binding assurances given in February will not turn out to be the sick joke that every other assurance has turned out to be?
The Prime Minister: I am advised that the agreement will stay within the guideline. As I said, those arrangements have been set into a binding legal form, have been passed by the European Parliament and will be laid before this Parliament tomorrow, together with the increase in own resources, so that their effectiveness can be debated before the House gives its approval to the increase in own resources. I am sure that my hon. Friend will have a lot to say in that debate.
Mr. Sydney Bidwell: Is the right hon. Lady aware that her answers on health and safety at work sound most smug and unsatisfactory? Is she aware that there have been drastic cuts in the number of health and safety inspectors at work? Will she be prepared to consult the trade unions on the matter to see what our standards are like compared with those of other European countries?
The Prime Minister: Obviously, the standards in other European countries are varied. Their standard of living is varied and, obviously, the standard of living that they have reached impacts upon their health and safety regulations. We are very good on health and safety, as are West Germany and a number of other countries, but I do not anticipate specific improvements in that unless there are separate reasons for requiring those improvements.
Mr. David Curry: As the object of the creation of the internal market is to liberate companies to compete in the wider market, will my right hon. Friend make sure that we do not proceed to elaborate on social legislation to such a degree that we shackle industry so that it cannot compete in global markets?
The Prime Minister: My hon. Friend has put his finger on the most relevant point. There is a tendency at present in the Commission and the Council to increase the amount of regulation almost to the point of standardisation, rather than harmonisation. Of course, safety standards on products must he clear and, when it comes to setting up

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legislation for a European company, if it is to increase trade, it must have the minimum regulation and not the maximum. The danger is that they are moving towards far too much regulation.
Mr. Dick Douglas: Will the Prime Minister give us some insight into this unaccustomed unison between the two Front Benches in welcoming the reappointment of M. Delors? Why should we welcome the reappointment of a commissioner who has manifestly shown that he wants the thrust of the Common Market to be related to the Franco-German axis? Why should we, particularly in Scotland, welcome the thrust of the Common Market against an area which has no political countervailing power, as we have in the United Kingdom Parliament? Why should we in Scotland welcome 1992 without the creation of countervailing power in Edinburgh in the creation of a Scottish assembly?
The Prime Minister: We welcomed the reappointment of M. Delors and, with everyone else, voted for it because M. Delors has been an excellent President of the Commission. He started a great deal of the work on the single market for 1992 and we all thought it advisable that he should continue. I assure the hon. Gentleman that M. Delors is very much aware of the strength of the United Kingdom in the debates and discussions in the European Council. Edinburgh and Scotland can welcome the single market because it will give all the industries in Scotland a much larger market to which to export. The industries in Scotland are now, under Tory Government, enterprising and prosperous.
Several Hon. Members rose—
Mr. Speaker: Order. The House well knows that there is a rare opportunity today to debate foreign affairs. No fewer than 34 right hon. and hon. Members wish to take part. I shall therefore have to limit questions to a further two from each side and then we must move on.
Mr. Kenneth Warren: I congratulate my right hon. Friend on the encouragement of wider public purchasing, but will she consider pursuing that into the defence industry in Europe where, for far too long, British companies have put up with a share based on what other countries will tolerate, rather than the competitive purchasing that would encourage those industries in their efficiency?
The Prime Minister: The wider public purchasing clause is not directed to defence industries. As my hon. Friend knows, we co-operate with other members of NATO and with France as a political member, although not a military member, of NATO. We operate on a different network.
The real trouble with public purchasing is that, in theory, all the tenders should already have been opened up to the whole of Europe, but in practice they have not. We have been very open, as we usually are. We abide by the rules, but we are not certain whether all other people do and we wish that the whole of Europe was as open to tender—on the basis of the most efficient tender—as we are. It will be our purpose to achieve that.
Mr. Dennis Skinner: Would it not be welcome, just once in a while, if the Prime Minister, when coming back from these Euro-summits, was able to start
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telling the truth about economic co-operation? Is it not a fact that West Germany, with a $40 billion surplus on its balance of payments, is now ruling the roost and that that economic power is now changing into political muscle, whereas for Britain, with a balance of payments deficit of £12 billion this year and invisibles being scaled down to £5 billion from £7 billion last year, the prospects are very glum indeed? The truth is that we shall be dominated in the Common Market by the Franco-German axis, the people Britain had to sort out in 1940–45.
The Prime Minister: Let us leave the hon. Gentleman to wallow in his own depression. It does not extend to other people. This country has grown far faster than West Germany over the past six years and the degree of subsidisation of Germany industry by the German Government is greater than in this country. That is very damning to Germany because it means that she is not carrying out the restructuring of her industry as she ought to be doing and it means that we have a greater chance to be more competitive than she has. I am quite certain that Germany would love to have the budget surplus that we have in this country.
Mr. Eric Forth (Mid-Worcestershire): My right hon. Friend said that the
`burdens on business will be steadily reduced'.
Did she take the opportunity to discuss with her colleagues at the meeting the difference in performance between the United States and the Community, particularly in job generation? Did they draw the obvious conclusion that the more burdens one places on business and the more regulations there are, the worse it is for employment generation? Will my right hon. Friend bear that in mind and keep reminding her colleagues that the more they seek to regulate business the fewer jobs will be created in the European Community?
The Prime Minister: I agree with my hon. Friend. The communiqué makes it clear that we have obtained the extra growth through cutting many of the regulations and, particularly, by cutting them on small businesses, which are the real engine for growth. I agree with my hon. Friend that the creation of jobs in the United States is much faster than it is on this side of the Atlantic and we would like to emulate them in that way rather more than we do.
Mr. Nigel Spearing: On the future harmonisation of VAT, on which the Prime Minister has given some assurances, although not on the future of VAT on water, books, newspapers and public transport, will she confirm that article 99 of the treaty of Rome puts on Governments a requirement for unanimity but that it does not exclude any measure by which national Parliaments can determine what their Governments do? Surely that makes the House of Commons only an advisory assembly in respect of that tax. Would it not be much better for the final decision concerning the Government's attitude to VAT to be determined in this House? Will the right hon. Lady reflect upon what steps should be taken to make that a reality?
The Prime Minister: No. The Government make the decision and come to the House for endorsement of their decision. It is the Government who have the budget and come to the House after debate for endorsement of those decisions. The hon. Gentleman is aware that, on every possible occasion in the Community, we fight the

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harmonisation of taxation and insist on being able to keep a zero rate for value added tax. It was, and remains, my understanding that any fiscal changes will be subject to unanimous vote. We have to come before this House, and we find it of great value that the House takes the same view on these matters as we do.

Business of the House
4.8 pm
The Lord President of the Council and Leader of the House of Commons (Mr. John Wakeham): With permission, Mr. Speaker, I should like to make a statement about the business for next week:
MONDAY 4 JULY—Remaining stages of the Civil Evidence (Scotland) Bill [Lords].
Committee and remaining stages of the Electricity (Financial Provisions) (Scotland) Bill.
Remaining stages of the Legal Aid Bill [Lords].
Motion to take note of EC documents on the limitation of the emission of pollutants from large combustion plants. Details will be given in the Official Report.
The Chairman of Ways and Means has named opposed private business for consideration at seven o'clock.
TUESDAY 5 JULY—Opposition Day (16th Allotted Day). There will be a debate on an Opposition motion entitled "The Threat to a Universal Free Health Service".
Motion on the Education (Assisted Places) (Amendment) Regulations.
Motion on the Sex Discrimination (Northern Ireland) Order.
WEDNESDAY 6 JULY—Opposition Day (17th Allotted Day). Until about seven o'clock there will be a debate on a Scottish National party motion entitled "The Political Situation in Scotland". Afterwards there will be a debate on a Social and Liberal Democratic party motion entitled "Hardship to Pensioners Caused by Government Policies".
Second Reading of the Court of Session Bill [Lords], which is a consolidation measure.
THURSDAY 7 JULY—Estimates Day (2nd Allotted Day).
There will be debates on Defence (class 1, vote 1), Housing, England (class IX, vote 1), and Local Environmental and Planning Services etc., England (class X, vote 1). Details will be given in the Official Report.
Motion on the Church of England (Ecumenical Relations) Measure.
FRIDAY 8 JULY—Private Members' Bills.
MONDAY II JuLY—Second Reading of the European Communities (Finance) Bill.
Debate on Monday 4 July 1988
Relevant European Community documents
Air pollution from large combustion plants.

(a) 11642/83

(b) 5124/85

(c) Un-numbered

Relevant Reports of European Legislation Committee

(a) HC 78-xxvii (1983–84) para 4

(b) HC 5-xviii (1984–85) para 2

(c) HC 43-xxviii (1987–88) para 1

Estimates to be considered Thursday 7 July.

Class I, vote 1

(Defence: personnel costs etc. of the armed forces and civilians, stores, supplies and miscellaneous services), so far as it relates to the defence requirement for merchant shipping and civil aircraft;

Class IX, vote 1

(Housing, England), so far as it relates to the provision of bed-and-breakfast accommodation for the homeless;

537

Class X, vote 1

(Local environmental and planning services etc., England), so far as it relates to grants to local authorities for the provision of gipsy sites;

Mr. Frank Dobson: I thank the Leader of the House for his statement. Given his earlier commitments, when can we expect, first, an opportunity to debate the Committee on Procedure's proposals for short speeches, secondly, the Government's failure to set up a Select Committee on Scottish Affairs, and, thirdly, the Government's proposed changes to the law on official secrets?
As Britain has a balance of trade deficit in electronic goods of £2,000 million, when does the Leader of the House expect the McKinsey report on the future of the electronics industry to be published? When will there be a debate on the future of this crucial sector of the economy?
The consultation period on the Green Paper on the public library service ends today. When will the responses be published, and when shall we have an opportunity to debate the preposterous proposals to levy charges for services which Winston Churchill thought should be free?
The consultation period has ended on the Government's proposals to hand over the swimming pools, sports grounds, sports halls and running tracks that are now owned and used by local communities to profit-seeking private companies. Will the Leader of the House ensure that all the responses are placed in the Library, as promised by the Minister? Will he ensure also that the House has an opportunity to debate the proposal before any decision is taken by the Government? Will he give the House an assurance that any statement of Government policy is presented in an oral statement and not by written answer?
This is an important matter because the proposals, if they are accepted and implemented, will harm sporting opportunities for countless young people who will not be able to afford to pay for them. The only reason for the proposals is to increase charges. We do not want the proposals to be accepted and then to hear Ministers bleating and asking why young people are being vandalistic and violent, they having reduced the sports opportunities of young people.
Mr. Wakeham: The hon. Member for Holborn and St. Pancras (Mr. Dobson) has asked me a number of questions. He has asked specifically when we should have debates on a number of subjects.
I understand that the Committee of Selection has reported its view that there is no generally acceptable basis for producing names to complete nominations for a Select Committee on Scottish Affairs. In these circumstances, I think that the matter should be debated by the House. The timing of the debate is probably best left for discussion through the usual channels.
My right hon. Friend the Home Secretary made a statement yesterday on official secrets legislation and the White Paper. I think that the timing of that debate is best left also for consideration through the usual channels.
The hon. Member for Holborn and St. Pancras asked me about the date of publication of the McKinsey report
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on the electronics industry. I do not have that date available, but I shall refer the matter to my right hon. Friend the Secretary of State.
The hon. Member for Holborn and St. Pancras said that the consultation period on the public library service ends today. The Government will want to consider the results of the consultation before making a statement.
My right hon. Friend the Secretary of State for the Environment will be making an announcement shortly on the proposals to be put forward on the privatisation of sports and leisure facilities following a consultation paper which was issued last autumn. If we decide to proceed with the proposals, the necessary order under the Local Government Act 1988 will be preceded by further consultation, and implementation will be delayed beyond 1 August 1989, which is the date by which authorities must begin the phased introduction of competition for the activities that are listed in the Act. I have taken note of what the hon. Gentleman said. I shall refer the matter to my right hon. Friend the Secretary of State for the Environment.
Several Hon. Members rose—
Mr. Speaker: Order. I ask the House to reflect on what I said earlier. No fewer than 34 right hon. and hon. Members want to take part in the debate on foreign affairs. I do not like to limit questions, and accordingly I shall allow them to continue for a further 20 minutes. I hope that all those who wish to put a question to the Leader of the House will be able to do so in that time. We must then move on.
Mr. Patrick Cormack: Will my right hon. Friend the Leader of the House arrange for my right hon. Friend the Paymaster General to make a statement next week about the Barlow Clowes affair? Will my right hon. Friend the Paymaster General say something about providing compensation for those who suffered through no fault of their own, many of whom are in great hardship?
Mr. Wakeham: My right hon. Friend the Secretary of State for Trade and Industry announced the timing of the completion of the inquiry into the facts of his Department's handling of the Barlow Clowes affair. That announcement was made after consultation with Sir Godfray Le Quesne. It represents the best estimate possible of the time needed to complete the investigation. I do not think that it would be sensible or productive to seek arbitrarily to impose a shorter time limit. It is important that we obtain an authoritative report.
The Barlow Clowes affair will be raised in an Adjournment debate early next week, when I hope that the Minister who replies will be able to say a little more about it. I recognise the concern of my hon. Friend the Member for Staffordshire, South (Mr. Cormack), but the important thing is to ensure that the report is produced quickly.
Mr. Jack Ashley: Has the Leader of the House seen the recent report in The Independent, which states that the official Government survey on disabled people shows that there are now 6 million disabled in Britain, many of them living in poverty? It seems that the Government are not prepared to release the report until September, when the House will be in recess. May we have a statement next week about that?
Mr. Wakeham: I do not know about the recent report in The Independent. I remember, however, my right hon. Friend the Prime Minister saying a short while ago that there has been an 80 per cent. increase in real terms in help for the disabled under the Conservative Government. I recognise the right hon. Gentleman's concern, however, and I shall refer the matter to my right hon. Friend the Secretary of State for Social Services.
Mr. Andrew Rowe (Mid-Kent): On the afternoon when we have heard of remarkable progress being made towards the establishment of a common market, will my right hon. Friend take note that the people of Kent feel enormously anxious about the provision of roads to cope with the increased traffic that will ensue? May we have a debate about that? At the very least, will he ask the Secretary of State for Transport to undertake an urgent reappraisal of what he is up to?
Mr. Wakeham: I recognise that it is an important issue in Kent. I wish that I could offer my hon. Friend a debate in the near future, but this is an especially busy time of year and I do not think that I can do that. I shall refer his second suggestion to my right hon. Friend the Secretary of State for Transport.
Mr. James Wallace: Does the Leader of the House recall that, after the most recent general election, the Secretary of State for Scotland said that it would be business as usual in spite of the small representation of Conservative Members in Scotland? There is no Select Committee on Scottish Affairs, and it is clear that it is not business as usual. What does he propose to do to save the face of his right hon. and learned Friend?
Mr. Wakeham: As the hon. Gentleman knows, I put proposals to Opposition parties on how we could set up a Select Committee on Scottish Affairs. Unfortunately, the proposals did not meet with universal enthusiasm. The best course is to have a debate and to clarify the issue.
Mr. Andrew MacKay: Further to the question of my hon. Friend the Member for Staffordshire, South (Mr. Cormack), will my right hon. Friend confirm that the Minister who will be responding to the Adjournment debate on Barlow Clowes next week will deal with the issue of compensation? Secondly, when the internal independent report into the Department of Trade and Industry has been published, may we have a full debate on the Floor of the House and not merely a statement?
Mr. Wakeham: I do not think that I can say any more than I said to my hon. Friend the Member for Staffordshire, South (Mr. Cormack). We must wait for the Adjournment debate next Tuesday and decide then how to proceed from there.
Mr. Tom Pendry: Does the Leader of the House agree that the way in which the Secretary of State for the Environment has conducted a consultation exercise on competition in the management of local authority sports and leisure facilities amounts to a complete sham? To take up the remarks of my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson), will he not reprimand the Secretary of State?
On 25 January, when I asked a junior Minister whether he would place in the Library the responses of all those who had replied to the consultation paper, he said that he
540
would do so as soon as possible. I have visited the Library and have found that there have been 16 responses from organisations in Wales and not one from all the other 300 that he consulted throughout the country, or which he says he consulted. Will the Leader of the House reprimand the Secretary of State for the Environment and make no statement until we have had a chance to visit the Library to read the responses to the consultation paper?
Mr. Wakeham: If any undertaking given by a member of the Government has not been fulfilled, I take that to be a serious matter and I will look into it. However, I hope that the hon. Gentleman will not take it amiss if I say that I would like to check with my right hon. Friend the Secretary of State before I accept the strictures that the hon. Gentleman has laid on him.
Mr. John Bowis: Will my right hon. Friend acknowledge the growing disquiet about the jury system? We have seen the eyeballing techniques, fraternising with the accused and now the substitution of bogus jurors for people who simply do not want to turn up. Should not public confidence in the jury system be re-established by airing the problem in the House?
Mr. Wakeham: Confidence in the jury service is an essential part of our criminal justice system. Any concern should be ventilated and debated in this House. However, I hope that my hon. Friend will understand if I cannot promise him a debate in the immediate future.
Mr. Harry Cohen: May we have a statement next week on why the campaign to educate our people about the dangers of AIDS has been scrapped or virtually has ground to a halt because of the Government's mistaken morals? Health education books have been pulped because the Government do not like the list of help agencies. Instead of being pragmatic, are not the Government being "prigmatic"?
Mr. Wakeham: The Government have taken the problem of AIDS extremely seriously and have taken a number of very important initiatives. I am glad to say that in the main those initiatives have had the support of hon. Members on both sides of the House and I would like that to continue. I recognise that we have not had a debate in the House on this subject for some time, and obviously the House will want to return to the subject. However, I cannot promise an early debate, but I recognise the force of the hon. Gentleman's comments.
Mr. Richard Shepherd: Following yesterday's publication of the White Paper on section 2 of the Official Secrets Act 1911, the last paragraph of which says that the Government intend that there will be a debate by the end of July, will my right hon. Friend give as early a sign as possible of that date?
Mr. Wakeham: I will give as early a sign as I possibly can. I believe that the date for the debate is best discussed through the usual channels.
Mr. Alex Salmond: Now that the discussion period on "The Way Forward" is over and Nirex is openly discussing with Scottish landowners the possibility of access to land for test boring, is it not time for a full debate on the issue of nuclear waste disposal? Will the Leader of the House give us valuable instructions on how to keep nuclear waste out of our constituencies?
Mr. Wakeham: I believe that the consultation period has only recently ended. It is right that Nirex should have time to consider that and make proposals. Obviously the House will want to debate the subject at some stage, but I do not believe that that stage has been reached yet.
Mr. Tony Marlow: Despite the great and continuing differences between this country and the Soviet Union, I wonder whether we could have a debate on the similarity between our two countries and, in particular, on the fact that we both have one-party states in that there is only one party in either country that is capable of civilised and intelligent internal debate about the real issues facing the country; that there is only one party in either country that is looking to the future rather than the past; and that there is only one party in either country that is capable of forming or likely to form the Government?
Mr. Wakeham: A parliamentarian of lesser skill than my hon. Friend might have difficulty keeping a speech on that subject in order in the foreign affairs debate that follows. No doubt if my hon. Friend catches your eye, Mr. Speaker, he will be able to keep his comments in order.
Mr. Peter L. Pike: In recognising that there is widespread concern about the Government's determination to go ahead with the privatisation of water, will the Leader of the House ensure that we have a debate on that important matter as soon as possible before the summer recess? Perhaps it would be useful to latch that debate to the Select Committee report which will be published soon containing the Government's response. We must also take into account the fact that the lower the standards that are fixed, the more money there will be in privatisation from the Government. We want the highest possible standards if privatisation is to be forced ahead.
Mr. Wakeham: I recognise that this is a very important subject and I hope that I will not disappoint the hon. Gentleman by making him wait too long for a debate. However, I cannot promise a debate before the summer recess.
Mr. Phillip Oppenheim: Bearing in mind the moves in the Soviet Union towards a more consumer-orientated society, does my right hon. Friend feel that we have anything to learn from that attitude? If not, may we have a debate on the fact that in this country we still have import quotas and controls on cars, vans, trucks and cultivated mushrooms in brine? Perhaps during that debate the Minister responsible can tell us how he squares that with the Government's policy on deregulation and a free market.
Mr. Wakeham: I cannot promise a debate on that subject next week, interesting though it would be to have one.
Mr. Tam Dalyell: I gave notice this morning about the Fiat sale of 16·7 per cent. of Westland Helicopters Ltd. to United Technologies Corporation. Will the Leader of the House comment on that?
Mr. Wakeham: I am grateful to the hon. Gentleman for giving me notice of his question. The Government and Westland Helicopters Ltd. consider that negotiations between UTC and Fiat concerning Fiat's holding in Westland are a matter for the two companies concerned.
542
As is well known, the Ministry of Defence has substantial contracts placed with Westland Helicopters. Any change in share ownership of the sort contemplated in no way affects those contracts.
Mr. Richard Holt: Is my right hon. Friend aware of a recent report commissioned and written within the DHSS by two junior and one middle-ranking officer on the relocation of civil servants throughout the country and that they have dismissed any removal to the north of England on the basis that it would be too great a culture shock for the Sir Humphreys of this world? In view of that and the likely precedent that it could have for the entire north of England in future, an early debate is required by those who represent northern constituencies which may be blighted and affected by that nonsensical report.
Mr. Wakeham: That is obviously a very suitable subject for debate, but I cannot promise my hon. Friend an early debate. When the debate occurs, no doubt he or the Minister concerned will explain that about 80 per cent. of civil servants are located out of London.
Mr. Bob Cryer: Will the Leader of the House assure us that we will have a statement next week about the proposed privatisation of the Harland and Wolff yard to Mr. Ravi Tikkoo who is pressing the Government for a £100 million taxpayer subsidy for a somewhat illusory luxury liner? This is a very important matter, particularly as some of us believe that, in the light of Mr. Ravi Tikkoo's reputation, his adviser on getting money from the Government might be Mr. John de Lorean. We therefore believe that an urgent statement is necessary.
Mr. Wakeham: An expression of interest in the acquisition of Harland and Wolff has now come forward from Tikkoo Cruise Line Ltd. The Government will consider that and any proposals from any other parties which might lead to the privatisation of the company. My right hon. Friend the Secretary of State for Northern Ireland will make a statement when there is something to say, but not at this stage.
Dr. Norman A. Godman: In the light of what the Leader of the House said about the likely takeover of Harland and Wolff, should we not in the near future have a debate on the shipbuilding intervention fund? Presumably Mr. Tikkoo has had his appetite whetted by the generous gift of the Govan yard that the Government have given to Kvaerner, the Norwegian company. Should not the shipbuilding intervention fund debate determine once and for all that all engines purchased for vessels to be constructed in British yards should be purchased from British marine engineering companies?
Mr. Wakeham: As the hon. Gentleman is aware, shipbuilding was debated on the Floor of the House on 19 May. My right hon. and learned Friend the Chancellor of the Duchy of Lancaster said that he would report further on developments. He gave a full answer to a written question on Monday on the sale of the Govan yard to Kvaerner. I wonder whether the hon. Gentleman might think that some aspects of this subject might be debated next week in the debate on Scottish affairs.
Mr. D. N. Campbell-Savours: In the light of the Government's repeated assertion that they condemn the local authority waste of ratepayers' money, may the House have a general debate on that matter? I know of several specific cases in the south of England concerning Tory constituents in the heart of Toryland, where Conservative-controlled local authorities are squandering hundreds of thousands of pounds of ratepayers' money. May we have a debate so that those matters can be discussed in Parliament?
Mr. Wakeham: I am very pleased to hear that the hon. Gentleman is in the business of condemning wasteful spending of ratepayers' money wherever it occurs; there is a measure of agreement between us on that point. I suggest that the hon. Gentleman's earliest opportunity for making some of his points might be when the Local Government Finance Bill returns to this House. I hope that we shall not have too long to wait.
Mr. Max Madden: Is the Leader of the House aware that, as a result of the outcome of the court case concerning the Severn-Trent water authority and Cakebread, massive amounts of money will be a burden on the backs of ratepayers and local authorities? In the case of Bradford, the amount involved is about £2 million for the backdating of refunds of general rates on sewage works. Will he arrange for the Secretary of State for the Environment to come to the House and do what he has done many times before—put right his mistake so that ratepayers all over the country will not be forced to pay further amounts of money, making the privatisation of the water industry even more lucrative for the City spivs than it is already?
Mr. Wakeham: I do not accept a great deal of what the hon. Gentleman says, but I recognise that he points to a case of consequence and of some importance. I shall refer his point to my right hon. Friend.
Mr. Harry Barnes: Would it not be useful to have a wide-ranging debate on Northern Ireland when the House could discuss the Harland and Wolff situation? The House had two debates on Northern Ireland last night and there is to be another tomorrow, concerning specific and limited areas. I was present last night, when the Chamber was almost empty, which was a bad time for that discussion to take place. There are many other wider issues, such as attempted moves towards democratisation in Northern Ireland involving the establishment of a Bill of Rights, the establishment of devolved government, and moves to attack paramilitarism and militarism in the Province. A wider debate would be of value.
Mr. Wakeham: I recognise that, however many debates on Northern Ireland we manage to arrange, there will be hon. Members with still more to say on the subject. It seems to be a characteristic of Northern Ireland politics that there is a great deal to say. We have not done too badly on Northern Ireland matters. At present, there is a lot of pressure on our time and I cannot promise another debate in the near future. However, I note that there is to be a debate on the Sexual Discrimination (Northern Ireland) Order next Tuesday night.
Mr. Paul Boateng: Given the widespread concern in all quarters of the House in the aftermath of last Monday's ITV programme about the activities of the mobster landlord Nicholas van Hoogstraten, will the Leader of the House consult his right hon. and learned Friend the Attorney-General about coming to the House to make a statement on referring the matter to the Director of Public Prosecutions in order that that mobster can be prosecuted for conspiracy?
Mr. Wakeham: If the hon. Gentleman has any evidence, it is not a matter for the Government. The Government are not the prosecuting authority, as the hon. Gentleman knows. He knows also that nobody in any part of the House has any time or support for anyone indulging in criminal activities. However, many of the housing difficulties that have occurred in the past have been the result of restrictive Rent Acts, and we are trying to remedy that problem.
Mr. Nigel Spearing: The Leader of the House has announced that there will be a debate on the European Communities (Finance) Bill on 11 July. Has that Bill yet been published, and, if not, when will it be? Will he confirm that it will contain two elements: first, an endorsement of what has become known as the Delors package, and, secondly, authority for an advance payment to the EEC to keep it going, in expectation of the fact that other countries will endorse the Delors package. If the latter element is included, would not that be very unbusinesslike and bad, because we would be voting money without knowing whether the resources would be available?
Mr. Wakeham: I will not confirm anything about a Bill that is to be published tomorrow; notice has been given. I can tell the hon. Gentleman that two Command Papers have been published and they are now available in the Vote Office. As I have already said, we propose giving that Bill a Second Reading on Monday 11 July.
Mr. Dennis Skinner: Will the Leader of the House give an absolute guarantee that the Secretary of State for the Environment will come to the House to make a statement, or to engage in a debate, about the sale of sports fields belonging to local authorities? Is it not preposterous of the Government to have such an idea in their head? Will he dispel the rumour that is spreading through this place that one of the persons suggested to operate the quango concerned is Lady Porter of Westminster city council? Would it not be disastrous for the Government's budget if they were to put her in charge?
Mr. Wakeham: I cannot comment on any and every rumour in this place. I gave a reply to the hon. Member for Holborn and St. Pancras (Mr. Dobson), and I am not prepared to add to it.
Mrs. Ann Clwyd rose—
Mr. Tony Banks rose—
Mr. Speaker: Order. I am sorry that I am unable to call the three hon. Members, but they are all anxious to take part in the foreign affairs debate.

County Hall (Development)
4.35 pm
Mr. Tony Banks: I beg to ask leave to move the Adjournment of the House under Standing Order No. 20, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the decision by the London residuary body to dispose of county hall, the home of the former Greater London council, for use as a five-star luxury hotel."
This is a specific matter, as it relates to a decision that has not been discussed in the House but which should be, because of the nature of the proposal and the proximity of county hall to the Palace of Westminster.
It is a matter of urgency because the LRB's decision will undoubtedly require the approval of the Secretary of State for the Environment and he should be required to consult the House before reaching his own decision.
It is evident to me that the London residuary body has deliberately chosen for county hall a use that is totally at odds with that building's history as the centre of London local government. I detect in that decision the malevolent influence of the Prime Minister, who has made it clear in a series of well-publicised press briefings that she requires all evidence of the GLC to be removed. To that end, she is prepared to trample on 100 years of local democracy and to reduce local government in this country to near-chaos. I suspect that together with the Secretary of State for Education and Science, she would prefer county hall to be demolished, but on this occasion her Nero-like tendencies have been frustrated by county hall's listed building status.
The House should have an opportunity to hear from the Secretary of State for the Environment whether he is satisfied that the listed building regulations will not be flouted by the development proposals. It should also have an opportunity of deciding whether it wishes to have a hotel so close to Parliament, with all the attendant nuisances during construction, and, after, its visual intrusion and traffic problems. The Secretary of State should be required to explain to the House the apparent conflict between his decision announced on 20 October 1987 to reduce the number of planning permissions for hotel and residential use of the main riverside block and the proposal accepted by the London residuary body, which appears to ignore his previous ruling.
The Secretary of State should also he required to tell the House why he disagreed with his own inspector's recommendation after last year's public inquiry that the main county hall building should be retained for local government activities. Finally, the House should be given an opportunity to hear the Leader of the Opposition and the shadow Secretary of State for the Environment restate their commitment to restoring a Londonwide local government authority and taking county hall back into public ownership by a compulsory purchase, should it be turned into a hotel. The potential developers should have an opportunity to hear those statements before laying their dirty, money-grubbing fingers on county hall.
County hall was purpose-built as the home of the London county council and was paid for by the ratepayers of inner London. Abolishing the democratically elected GLC was an act of unparalleled political vandalism. To convert that historic building into a luxury hotel is an insult to London, an insult to the homeless, and an insult
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to the fine work of the London county council and the Greater London council. I ask you, Mr. Speaker, to consider very favourably my application under Standing Order No. 20.
Mr. Speaker: The hon. Member 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 London residuary body to dispose of county hall, the home of the former Greater London council, for use as a five-star luxury hotel."
I listened with great care to the hon. Member but regret that I do not consider that the matter he has raised is an appropriate one for discussion under Standing Order No. 20. I am sure that the hon. Member will find other opportunities for keeping the matter before the House.

Points of Order
Mr. Speaker: I shall take the points of order. but I hope that they will be brief.
4.39 pm
Mr. Tony Marlow: On a point of order, Mr. Speaker. It has long been the tradition and custom of the House that the first business question is asked by the Leader of the Opposition. That seems to have been a satisfactory situation, in keeping with the dignity and importance of the business of the House. Recently you will have noticed that the Leader of the Opposition has not been here for business questions. Is that because the Leader of the Opposition is more important than his predecessors or because the business of the House is now less important than it was before?
Mr. Speaker: That is not a matter of order. It is perfectly in order for the shadow Leader of the House to ask questions on a business statement.
Mr. David Winnick: On a point of order, Mr. Speaker. I have just been shown a note about wines on House of Commons stationery circulated by the hon. Member for Luton, North (Mr. Carlisle) to members of the all-party South African group. Inquiries have been made at the Serjeant at Arms' office and it has apparently been confirmed that the postal services and notepaper of the House of Commons should not be used to promote business matters and commercial activity of this nature.
This matter has just been drawn to my attention. It is extremely unfortunate that House of Commons stationery should be used to promote wines and other such products, bearing in mind that, at every opportunity, the hon. for Luton, North reflects the views of the apartheid regime. I suggest, Mr. Speaker, that you ask the Serjeant at Arms to make a thorough investigation into this serious matter.
Mr. Speaker: I shall ask for the matter to be investigated.

STATUTORY INSTRUMENTS, &c
Mr. Speaker: With the leave of the House, I shall put together the two motions relating to statutory instruments.
Ordered,
That the draft EUMETSAT (Immunities and Privileges) Order 1988 be referred to a Standing Committee on Statutory Instruments, &c.

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That the draft EUTELSAT (Immunities and Privileges) Order 1988 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Lightbown]

SCOTTISH ESTIMATES
Ordered,
That the Estimates set out hereunder be referred to the Scottish Grand Committee:

Class XVI, Vote 1, Agricultural Support, Scotland

Class XVI, Vote 2, Agricultural Services and Fisheries, Scotland

Class XVI, Vote 3, Regional and General Industrial Support, Scotland

Class XVI, Vote 4, Manpower Services Commission, Scotland

Class XVI, Vote 5, Regional Assistance, Scotland

Class XVI, Vote 6, Roads, Transport and Environmental Services, Scotland

Class XVI, Vote 7, Local Transport, Water, Sewerage and Environmental Services, Scotland

Class XVI, Vote 8, Housing, Scotland

Class XVI, Vote 9, New Towns and the Urban Programme, Scotland

Class XVI, Vote 10, Privatisation of the Electricity Supply Industry, Scotland

Class XVI, Vote 11, Administration of Justice, Scotland

Class XVI, Vote 12, Police Grant, Legal Aid and Criminal Injury Compensation, Scotland

Class XVI, Vote 13, Legal Proceedings, Scotland

Class XVI, Vote 14, Prisons, Hospitals and Community Health Services, Etc, Scotland

Class XVI, Vote 15, Education, Arts, Libraries and Social Work, Scotland

Class XVI, Vote 16, Student Awards, Scotland

Class XVI, Vote 17, Health (Family Practitioner Services), Scotland

Class XVI, Vote 21, Scottish Office Administration. [Mr. Lightbown.]

Foreign Affairs
Motion made and Question proposed, That this House do now adjourn.—[Mr. Lightbown.]
4.41 pm
The Secretary of State for Foreign and Commonwealth Affairs (Sir Geoffrey Howe): My right hon. Friend the Prime Minister has just given the House an account of this week's Hanover European Council, and the House has heard that we are likely, before long, to be debating the legislative consequences of the spring Brussels Council. So today I intend to say very little about Europe. My right hon. Friend the Minister of State, will, of course, be ready to answer particular points at the end of the debate. I want, instead, to look at the wider picture and to begin by making two observations.
In the period since our debate last year, the foreign policy climate has taken an undoubted turn for the better. The two successful super-power summits—in Washington and in Moscow—the agreement on intermediate range nuclear forces and the beginning of the withdrawal of Soviet troops from Afghanistan have put East-West relations on a better footing than for many years. Those are important matters.
Through the events which affect our foreign policy, a constructive British voice has been heard loud and clear, from Moscow to Madrid, from Tokyo to Toronto, either posing the right questions or pressing the right solutions.
Still the most important challenge that we face is that of managing the East-West relationship. We have to protect Britain's interests and Britain's security while minimising any risk of unpredictable tension and conflict. To do that, we need a stable framework of contact and dialogue where the problems that do arise can be tackled calmly.
I believe that we are making real progress in that direction. The Moscow summit was the most obvious sign. It was a summit where the absence of new breakthroughs did not mean failure but rather that relations between the super-powers have reached a new maturity.
That is the measure of the success of the foreign policies of President Reagan and his tenacious Secretary of State, George Shultz. They have taken great pains to proceed, so far as possible, on the basis of bipartisan support. So whether the next United States Administration is headed by President Bush or by President Dukakis, we shall find it easy to work alongside them.
That will be important, because relations between our own country and the Soviet Union have played a key part in the recent East-West dialogue. My right hon. Friend the Prime Minister's visit to Moscow last year broke new ground with her talks with Mr. Gorbachev and the impact that she made on the Soviet people. Mr. Gorbachev's visit: to Brize Norton underlined the improvement in our relations.
I was in Moscow again in February for talks with the Soviet leadership. In the last three years I have met my Soviet opposite number, Mr. Shevardnadze, 10 times. Exchanges between our countries at all levels are growing. We all look forward to welcoming Mr. Gorbachev to Britain again before long.
Are we then in a new East-West era? A great deal obviously depends on the fate of Mr. Gorbachev's attempts to reform the Soviet Union. This week a drama of major potential significance is being played out in Moscow. Thanks to glasnost and the television camera, we

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are able to follow the proceedings of the first party conference since 1941 with a good deal more insight into party workings than usual. We cannot yet know the outcome, but the spectacle of at least the beginnings of a genuine debate is immensely encouraging, and once again we must admire the courage and determination of General Secretary Gorbachev to tackle the fundamental failings of his society and political system. We should not believe that we are witnessing a transition to anything like our own society or genuine democracy—this is still the beginning of the beginning—but Mr. Gorbachev is manifestly pushing in the right direction, and we wish him well.
Mr. David WinnickDoes the Foreign Secretary agree that if the truth were fully publicised to the Soviet people about the Stalin era in particular and, to a lesser extent, the crimes and abuses which occurred under Brezhnev, including the speech that Khrushchev made at the 20th party congress in March 1956, that would be one way in which such abuses would be prevented from recurring?
Sir Geoffrey Howe: The hon. Gentleman will be able to develop that point in his speech. It is very much in line with the sentiments that Mr. Gorbachev expressed in the course of his speech, when he said:
"We are learning democracy in glasnost, learning to argue and conduct debate, to tell one another the truth."
That is very much in line with the point that the hon. Gentleman has just made.
But our watchword must continue to be vigilance, because—as Mr. Gorbachev knows better than anyone—reforms of the Soviet system have still a long way to go, in face of well-entrenched opposition. As yet, they are very far from being irreversible.
We need vigilance, too, for our own security in face of the continuing strength of the Soviet military machine. The guarantor of that security is the North Atlantic Alliance, and in recent years NATO has served us very well. We owe a considerable debt to the retiring Secretary-General, my distinguished predecessor, Peter Carrington.
Who would have believed, four years ago, when East-West relations were in the deep-freeze and the Russian seat at Geneva was empty, that the INF treaty would have been ratified; that we would have begun to bring transparency and predictability to conventional force movements; that strategic arms negotiations would now be well under way; that considerable progress would have been made in the highly complex chemical weapons negotiations; and that we would not have the prospect of early talks on conventional stability in Europe?
The Alliance has been able to secure those major achievements because its policies have been sound and its members united.
As I told the third United Nations special session on disarmament earlier this month—and we regret the fact that, despite all our efforts, it was unable to reach an agreed conclusion—arms control is very far from being an easy option. It takes hard work. We need hard-headed, verifiable proposals which are compatible with the security needs of the countries involved.
Let me say a word about negotiations where the United Kingdom itself is specifically engaged.
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The huge imbalance in conventional forces is at the heart of the security problem in Europe. For that reason, we are working closely with our allies to elaborate specific conventional arms cuts proposals.
Fifteen years' experience in the mutual and balanced force reduction talks convinces us that the negotiations ahead will not be easy, but there are encouraging signs. Mr. Gorbachev said at the Moscow summit that he accepts the need to eliminate the disparities in conventional forces which do exist—to Russia's enormous advantage—before further cutting of troop levels begins. He also accepts the need for proper verification. Mr. Shevardnadze has echoed those points in the United Nations, and that is good. These are important moves towards the long-standing Western position.
Britain's other long-standing goal has been a global ban on chemical weapons. So last month, at our invitation, a Soviet delegation visited the United Kindom's chemical defence establishment at Porton Down, and yesterday a British delegation left for a visit to the Soviet Union's own military chemical facility at Shikhany. These are important practical steps that we are taking along that path.
We have reached this point because the West has thought through its position. We have negotiated firmly but with imagination from a secure base. We have not had to resort to unprincipled manoeuvres or unwarranted contortions. We have been consistent and steadfast of purpose.
Those words must have a very novel ring for Opposition Members. I imagine that they must listen to the radio, watch television and scan the newspapers from day to day in the hope of finding out what their own defence policy is—sometimes, indeed, who their own defence spokesman is. They must count themselves extremely lucky if their own leader is found to have been coherent, let alone consistent, for as long as 48 hours at a time.
Last week The Independent reported what must have been a fascinating lunch under the stimulating, although very misleading headline:
"Labour's defence policy: Neil Kinnock explains."
Like just about every other reader, I guess, I rushed to get a copy of the paper with some excitement. I looked in vain for any explanation. So. too, I see from an article in The Independent this morning, did the right hon. Member for Bethnal Green and Stepney (Mr. Shore). The House may not yet have had a chance of seeing what he had to say about the Leader of the Opposition. The right hon. Gentleman said:
"First, I do not see how it is possible now to convince the electorate of a defence policy after Mr. Kinnock's remarks. Second, the lack of realism of Mr. Kinnock's thinking on nuclear issues has become painfully apparent."
The right hon. Gentleman described the defence policy of the leader of his own party as follows:
"It is about as relevant and convincing as Lambeth Council declaring itself 'a nuclear-free zone'.'
Mr. Tam Dalyell: Will the Foreign Secretary give way?
Sir Geoffrey Howe: In just one moment.
There may be another explanation. Perhaps another lunch at The Independent will change everything again. We owe a great deal to these lunches at The Independent. We do not know what The Independent serves for lunch, but lobster might be appropriate:

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"Will he, won't he, will he, won't he, will he join the dance?"
Mr. Dalyell rose—
Sir Geoffrey Howe: In just one second. I have made it plain that I will give way.
I think that many people will join me in wondering whether to laugh or cry at the spectacle of the Leader of the Opposition steering an uncertain course between the Scylla of Ron Todd and the Charybdis of Peter Shore. He dare not move the rudder either way lest he be wrecked and sunk with all hands on the rocks to the left or right. It grieves me to talk about a fellow countryman like this, but he must—
Mr. Dalyell rose—
Mr. Frank Haynes: I would like to know when the Foreign Secretary is going to talk about foreign affairs—[Interruption.]
Mr. Deputy Speaker (Mr. Harold Walker): Order.
Mr. Haynes: Yes, I know; there is so much rabble on that flipping Front Bench.
I want to know when the Foreign Secretary is going to talk about foreign affairs and stop attacking individual members of the Labour party.
Sir Geoffrey Howe: It is not usually regarded as remarkable if, in the course of a debate on foreign policy, one has a word or two to say about the foreign and defence policy of the Opposition.
Mr. Dalyell rose—
Sir Geoffrey Howe: One must conclude that the Leader of the Opposition is destined to linger in the middle as a kind of flying Welshman condemned for ever to sail unelected on a chartless sea.
Mr. Dalyell: The Foreign Secretary has been reading The Independent, but so have some of the rest of us. What we got out of The Independent last week was that Ministers and the Prime Minister had been
"playing fast and loose with the truth"
about Westland. Did the right hon. and learned Gentleman, as a skilled lawyer, draft the Prime Minister's speech of 27 January which was less than candid with the House of Commons? Why did he give his right hon. Friend——
Mr. Deputy Speaker: Order. We are not debating a motion for the Adjournment. I do not think that these matters are relevant to the issue before the House.
Mr. Dalyell: Who raised the question of The Independent of last week?
Sir Geoffrey Howe: I might have known that any intervention by the hon. Member for Linlithgow (Mr. Dalyell) was likely to be directed to one or other of his King Charles's heads. He reacts, apparently, like some kind of slot machine. As one presses the word "Independent" into it, so there bounces out an observation prompted by his latest reading of that distinguished organ.
In the real world, we have to make progress, and in the real world relations with the Soviet Union are not fixed for ever in a cold-war mode. We have to have an open mind, but Soviet history cannot be rewritten. We have to be cautious, without allowing caution to close our minds to
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change. The burden of proof of change lies heavily on their side. If it is truly the case that in political, economic and philosophical terms the Russians really are drawing nearer to the West, we are more than ready and willing to encourage them.
Certainly, around the world issues that have lived for many years under the label "hands off" are being looked at again. Some of the deep-frozen problems are coming in from the cold. At my last meeting with Mr. Shevardnadze earlier this month in New York, it was striking how many topics we were able to discuss in a serious, unpolemical way.
The Soviet decision to withdraw its troops from Afghanistan has helped to convince many that "new thinking" is more than just a phrase. Of course, the Soviet leaders are righting a terrible wrong. We want to see all Soviet troops out by the end of this year. The Afghan people must be left freely to decide their own future. Those who have fought for the freedom of their country for almost 10 years will not be denied victory; and the 5 million Afghan refugees must he allowed to return to their country in safety and with honour. We have already announced the doubling of our aid to Afghan refugees to £10 million this year.
Mr. Jeremy Corbyn: Will the Foreign Secretary tell us what efforts he is making to ensure that the Government of Pakistan fully comply with the Geneva accords and do not continue arms supplies into Afghanistan, which can only prolong a conflict that it is to be hoped will come to an end in the near future?
Sir Geoffrey Howe: We are in continuous contact with the United Nations Secretary-General. Last week I met the special appointee to consider the provision of refugee aid to Afghanistan, and I have noted with interest the extent to which a large part of Afghanistan is already under the effective control of the Mujahideen. We hope that this will open the way very shortly to the return of the refugees and to the commencement of the refugee aid programme.
The question that many in the House will ask is whether we can draw a wider lesson from the Soviet withdrawal. The Russians themselves have described Afghanistan as a pattern for settlement of other regional conflicts in which they or their clients are involved. Where such conflicts exist, we now look for a positive contribution to their resolution.
One other area in which there are now some signs of movement is Cambodia. Vietnam has announced a timetable for the withdrawal of its troops. I met my Vietnamese counterpart, Mr. Co Thach, earlier this month in New York and welcomed this. But we do not want to see the return to power of the dreadful Pol Pot and his Khmer Rouge. We support Prince Sihanouk's efforts to bring peace to his country. We vote with the overwhelming majority of the world at the United Nations year after year for the withdrawal of Vietnamese troops from Cambodia. We look forward now to the development of effective prospects as a result of Prince Sihanouk's efforts to bring peace to his country.
Britain also has a special interest in peace there, and in the possibility of less self-destructive economic policies in Vietnam. Recently, thousands of boat people have been leaving Vietnam and heading for Hong Kong. In those circumstances, as the House knows, we have recently announced a change of policy: only those who can show

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that they are genuine refugees will be given access to resettlement in the West. As for the rest—the economic migrants—their future must eventually be found back in Vietnam, their native land. The House, I know, looks forward to an early debate on Hong Kong.
In other parts of south-east Asia and the Pacific region, Britain is looking for progress of a different kind. With Japan, as with the People's Republic of China—two very different societies—we are building strong relations and creating new broad partnerships with those growing centres of power on the far side of the globe. As an economy that is also growing, we are keen to expand our links, as I have been able to do in the course of three visits to that part of the world since the start of this year.
Some other regional problems are showing movement. There are welcome signs of a return by South Africa and Mozambique to the spirit of the Nkomati accord. We have also been lending our full support to the United States-led negotiations between South Africa, Angola and Cuba on how to remove foreign forces from Angola and bring Namibia to independence. In May the parties met face to face for the first time, in London. The process was carried forward in Cairo last week. The prize is great but the difficulties remain formidable, and they have been exacerbated by the latest military clashes near the Namibian border.
Sir Ian Lloyd: My right hon. and learned Friend will be aware of the sudden and rather dangerous tip in the balance of air power on the Angolan frontier. He will know that the Russians are using the Cubans to supply the latest air superiority fighters for their forces in Angola, and that the South African Mirages will undoubtedly be outclassed. In his view, is it in the interests of the West that South Africa should not be able to defend its frontiers?
Sir Geoffrey Howe: The answer must partly depend on where we draw South Africa's frontiers. But South Africa has accepted resolution 435, for the independence of Namibia, which must be taken into account.
Of course, an escalation of armed conflict in the region is not desirable. I put that very point to Mr. Shevardnadze when urging him to encourage Cuba and Angola to engage seriously in the negotiations to which I have just referred. That is happening, and we wish the negotiations to succeed.
I wish that I could point to progress towards more fundamental change in South Africa. The immediate agenda on which we are working contains three items: the release of Nelson Mandela and other political prisoners; the preservation of foreign aid programmes from South African Government interference; and clemency for the Sharpeville Six.
In the longer term, as the House knows, we remain firmly of the view that only by making full use of our contacts with South Africa to press the case for change can we expect to influence developments and bring apartheid to an end. We are convinced—I have no doubt whatever about this—that punitive economic sanctions would hinder, not help, the chances of progress towards the non-racial democratic society that we all want to see.
Mr. David Ashby: In his wide-ranging speech, my right hon. and learned Friend has mentioned Angola. Is that not an example of change that is taking place in a similar way to the changes in Russia?
I know that my right hon. and learned Friend would like to look at other parts of the world where the same change is taking place—for instance, Nicaragua, whose vice-president is coming to the country at the beginning of July. Will my right hon. and learned Friend meet him to discuss the changes in Nicaragua, as well as the sensible changes in other parts of the world?
Sir Geoffrey Howe: We had offered to see the vice-president of Nicaragua, but he is not now coming to this country in July; nor is he being seen by a number of other Heads of Government and other representatives in Europe. But that does not mean that we are not interested in seeing progress towards plural democracy in Nicaragua.
Another area in which a hardening of attitudes and the ensuing deadlock has not helped is in the long-running Arab-Israel conflict. To break that deadlock, Israeli opinion must be brought to accept the inevitability of trading territory for peace—of allowing Palestinians the same right of self-determination as they have secured for themselves. Arab opinion must turn away from violence and unite in recognising Israel's right to a secure existence. Both sides must be ready to break away from the sterility of the status quo.
I must now deal with the suggestion—renewed in recent days—that there has been any change in our policy towards Iran. Let me make it plain that there is no truth whatever in that. Our policy has been clear and consistent, and it has not changed. I note that the right hon. Member for Manchester, Gorton (Mr. Kaufman) expected me to say more about the middle east, but the fact is that it is not possible to deal with every subject at comparable length. I am dealing now, at some length—and he will be interested in what I have to say—with the Iran-Iraq war.
In the past decade, Iran has undergone a revolution that has shaken the country to its foundations. It is not the first such revolution in the history of the world, and certainly it will not be the last. As in other cases, events in Iran have created an extremely severe strain in relations between that country and her neighbours—and, indeed, with the rest of the world. Of course, it was not our wish that there should be such strain in our relations. Iran is an important country, and one with which in the long run we must continue to do business. Where we can sensibly do that, we do. Hence the most recent round in the long-running talks on compensation on embassy premises.
Like other revolutionary regimes in the past, however, the Iranians must come to accept that there are certain necessary standards of international behaviour which must be observed if they are to have a normal relationship with the rest of the world. In recent years, Iran has flouted obligations under international diplomatic and consular agreements; harassed and assassinated opponents of the regime and fomented instability abroad; supported groups committed to sabotage and terrorism, including the holding of hostages; defied the authority of the United Nations; and attacked international shipping, including vessels under our own flag. From all that, it must be clear that there can be no fundamental improvement in our overall relationship in the absence of substantial and sustained changes in Iranian behaviour.

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I mentioned hostages. Hostage-taking is a particularly awful crime, whoever commits it and wherever it is done. We utterly condemn it. We expect, as a matter of normal civilised behaviour, that anyone with influence over hostage-takers should use that influence to help secure their release, and without seeking to extract a price. We ourselves do all that we can to discover the circumstances of British subjects held hostage, and to bring pressure to bear on their captors, both through our contacts with other Governments and through our own representatives abroad.
Despite being exposed to considerable personal danger, our embassy in Beirut plays a crucial role in this, and the whole House will wish to pay tribute to it. We are prepared to talk to anyone who we think might be able to help, but there is no compromise in our determination not to make concessions to secure the release of hostages. To do so would offer a reward to the hostage-takers, and put other British subjects at risk.
Mr. Tony Banks: Is the Secretary of State in a position to tell the House that Terry Waite and the other British hostages are still alive?
Sir Geoffrey Howe: I cannot give any certain and comprehensive information about that, but there is certainly some evidence that they are alive. There are so many reports in the newspapers almost daily that it must be immensely harrowing, particularly for the hostages' families, to be confronted with the constant stream
I hear the hon. Member for Kingston upon Hull, West (Mr. Randall) muttering on the Opposition Front Bench, and I entirely understand his concern. Of course we have other sources, and we are constantly seeking material and evidence. I am merely saying that the media, in their natural curiosity and to feed our curiosity, provide stories that lead—and mislead—people in all sorts of different directions. I understand their curiosity. There is no certainty that we can report to the House on these matters, but we seek evidence all the time.
Meanwhile, we have been playing a leading role in efforts to negotiate a settlement to the Iran-Iraq conflict. With the other permanent members of the Security Council we are looking at ways to enforce compliance with last year's United Nations cease-fire resolution. We have made proposals about a possible arms embargo. We have condemned, and continue to condemn, the use of chemical weapons by Iraq.
The House will know that the report of the Foreign Affairs Select Committee on the Iran-Iraq conflict was published this morning. I wish to express our appreciation of its work in producing an excellent report. I commend it to the House—and with all the more confidence, because it represents a powerful all-party endorsement of our policy towards Iran and the Gulf conflict.
Mr. Robert Hicks: I wholly understand the reasons for the policy on our relationship with Iran and endorse what my right hon. and learned Friend has said about deals and hostages, but does he agree that if, after nine years or so, an important Government wish to come to a better relationship with us, we should respond in whatever way we think appropriate? Surely that is the only way to achieve some form of the long-term objective that we all seek in that part of the world.
Sir Geoffrey Howe: I understand my hon. Friend's serious and well-informed interest in this matter and I respect the way in which he and his colleagues conducted their recent visit to Iran. I invite him to read carefully what I have already said about this matter. We recognise the importance of Iran and our ability in the long run to establish effective relations with a country of that size. We have not severed diplomatic relations; they have been reduced to a thin thread.
On the topic of compensation for damage to embassy premises—a subject that has been running for seven years—we have been prepared to resume that contact and to bring it effectively to a conclusion. We have no diplomatic representative in Iran because of the way in which the previous people there were treated and because of the lack, as yet, of confidence and assurance that things will be different in future. I entirely accept my hon. Friend's point that this matter must be judged in the light of all the aspects. That is why I invite him to read carefully what I said earlier in my speech.
Mr. Gerald Kaufman: Is it not a fact that if the regime in Teheran wanted to improve relations with this country. it could use its undoubted influence with the captors of the hostages in Beirut to secure their release speedily? If it did that, there would be a great prospect of improvement in relations between Britain and Iran.
Sir Geoffrey Howe: The right hon. Gentleman makes an important point. If he reads the Select Committee report he will see that it identifies several other matters in respect of which the Iranian Government could take action quickly to demonstrate the seriousness of their wish to move towards more normal relations. I have identified some of them. I am grateful for his support for maintaining the firmness and coherence of our position.
We live within the framework of rules of international order which have been established for many years. Other nations, whatever their revolutionary past—they are entitled to that—must come to terms with those rules and conventions. We certainly wish to move towards better relations within those rules, but it is on those terms and in that way that the matter must rest.
Meanwhile, we shall continue through our naval presence in the Gulf to uphold the principle of freedom of navigation in international waters and to protect vital Western economic interests. The whole House knows that the Royal Navy continues to play a major and constructive part in that respect. The effectiveness of our European partnership has been helped by the willingness of Belgium and the Netherlands to place their ships under Royal Navy operational control with effect from tomorrow, which is the first day of the British presidency of the Western European Union.
My right hon. Friend the Prime Minister has already dealt with European Community matters earlier today. As I have explained, I do not plan to add significantly to what she has already said. Our membership of the European Community is at the centre of our foreign policy. Within that Community, Britain has done a great deal to set the agenda for action and the terms of debate. That is important for the future of Europe and it is important for the future of Britain. We have worked, most recently, for

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three objectives: sensible financing, a containment of farm spending and priority to the single internal market. That British agenda has now become the European agenda.
In the world beyond the European Community, the same is happening. As in Britain, the pattern of debate is swinging away from old thinking, old philosophies and old assumptions. That was clearly evident at the Toronto summit. British input is vital in the new debate about how to manage East-West relations, reduce tension and tackle potential regional crises.
At the same time, our economic status is higher in the world than for many a long year. British foreign policy is no longer simply a reaction to events beyond our control. Now we have an important influence on those events. Around the world, from the quest for a single market in Europe to the improvement in super-power relations, Britain's voice is heard and Britain's advice respected. The people of this country can once again be proud of Britain's role in the world. Our policies have their support, and I commend them to the House.
5.16 pm
Mr. Gerald Kaufman: A year is far too long a time to allow to go by without what Mr. Speaker earlier today called a "rare, full-scale" foreign affairs debate in this House, particularly a year which has been so eventful and, in many parts of the world, so historic.
The Foreign Secretary rightly referred to the revolutionary changes in the Soviet Union. They are almost as revolutionary as those which took place just over 70 years ago. The changes have helped to lead to the heartening progress on disarmament and have already brought about Soviet withdrawal from Afghanistan.
There have been crisis-ridden areas where developments have not yet led to solutions of profoundly serious problems. Turkish troops still remain in occupation of northern Cyprus. I hope that the Prime Minister will take advantage of the Turkish President's visit here to seek beneficial movement on that issue. The long agony of Kampuchea continues, and hon. Members who have been there can report to the House on that themselves. The Government should play a more positive and constructive role in that part of the world.
As the Foreign Secretary pointed out, the Gulf war continues lethally and apparently interminably, with Iran as inflexible as ever and United Nations resolution 598 a historic document rather than a recipe for peace. There is no sign of follow-up action by the United Nations nearly a year after that resolution was passed unanimously by the Security Council.
Elsewhere, even where solutions are not yet available, the pace of events has often been headlong. If we had waited much longer, headlong change might have meant this debate being introduced by a new Foreign Secretary. We have already read in our newspapers those ill-omened outpourings of the Bernard Ingham Cabinet assassination machine which almost invariably point to an abrupt dismissal, subject to the briefings. In the Foreign Secretary's case those venemous briefings have been augmented by cruel remarks from the Prime Minister.
I understand that what really narked the Foreign Secretary and led even that soporific worm to turn was the
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off-the-record conversation conducted by the Prime Minister after an on-the-record interview which she gave to a subservient journalist, in which she said of the Foreign Secretary:
"He used to be a comfortable slipper, now he's just a worn-out old shoe."
Mr. Patrick Cormack: Is the right hon. Gentleman aware that if he carries on like this he will never aspire, or deserve to aspire, to being anything other than ambassador to Disneyland?
Mr. Kaufman: The hon. Gentleman has a capacity for sanctimonious pomposity which he has been able to demonstrate to the House on numerous occasions. I suggest that he confines it to his interesting books on the history of the House of Commons.
It seems that the Prime Minister's likening of the Foreign Secretary to an item of footwear galvanised him into activity, some of it just plain nonsensical, such as his rather pathetic boast of being the pioneer of Thatcherism—a claim which he made rather incongruously at the Waterman's Arms on the Isle of Dogs. The Independent said:
"the Foreign Secretary cast aside his more natural low-profile image as one of the unheralded backroom work horses of the Conservative Party and explained his central role in the creation of the 'enterprise culture'."
Enterprise and the Foreign Secretary are two concepts which it is difficult to associate closely.
Then there was the Foreign Secretary's clash with the Prime Minister about the European monetary system and his rather undiplomatic comments on the current United States election campaign. He tried to put that right a bit further this afternoon when he said that whether the next US Administration is headed by President Bush or President Dukakis we shall find it easy to work alongside him. We recall that, on 8 June, he was assisted by the right hon. Member for Guildford (Mr. Howell) who put a question to the Foreign Secretary, possibly inspired—but he can tell us if it was not—in which he asked:
"will my right hon. and learned Friend make it quite clear that, contrary to some newspaper reports, he holds no preference between one American presidential candidate and another in the forthcoming presidential election, that that is a matter for the American people to decide, and that either would do quite nicely?"
The Foreign Secretary replied:
"I am grateful to my right hon. Friend."
As indeed he was.
"As I said on the David Frost programme on Sunday—that important organ of public opinion—it is part of the democratic process that one works with the leader who emerges at the end of the day. I and Her Majesty's Government look forward to continuing close and friendly co-operation with whatever Administration emerges."— [Official Report, 8 June 1988; Vol. 134 c. 829–30]
What was it that the Foreign Secretary said to David Frost?
"I think one's always got to be very cautious about expressing opinions on elections in other countries because it's part of the democratic process that one works with the leader who emerges at the end of the day. But obviously it would be less than human if we didn't recognise the value of working with George Bush with whom we've worked for a long time. And he is, if there's anything in the kind of over-simplified right-left divisions in politics, he is on the right of American politics, and so are we in this country."
That was the impartiality in the US elections which the Foreign Secretary expressed. It has to be said that if there is a President Dukakis in November, I cannot imagine him exactly rolling out the red carpet for the author of those

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remarks, should the Foreign Secretary manage to survive in his Department until next January's inauguration. No wonder David Frost said after that enlightened interlude:
"There's so much more to talk about, we'll take a break and then we'll carry on."
The Minister of State, Foreign and Commonwealth Office (Mrs. Lynda Chalker): Could the right hon. Gentleman confirm a rumour that I heard the other day—that he will shortly be leaving the United Kingdom for the United States to attend the Democratic convention?
Mr. Kaufman: I have no doubt about who I want to win. I have no doubts at all on that subject, but the Foreign Secretary had to plant a question with the right hon. Member for Guildford to ensure that the Government's relations were acceptable. It is interesting that, on a matter which relates personally to the Foreign Secretary, he had to put his right hon. Friend the Minister of State up to think of a question to put to me. He could have got up himself.
There are some areas of activity where the Foreign Secretary gives little sign of carrying on or, indeed, doing anything at all. One is central America. After a welcome for last August's Guatemala accord which was scarcely discernible, the Government have not lifted a finger to help with the implementation of one of the most significant initiatives for peace in central America in decades.
The Foreign Secretary has failed to recognise that, among the four countries where fighting is going on in central America and which are parties to the accord, the only one which has taken any noticeable action to implement the accord is Nicaragua. The Under-Secretary of State seems to be having a slight seizure. Perhaps he can tell us why the Government are not assisting with implementation of the Guatemala accord when the Nicaraguan Government have moved further and faster to fulfil that accord's conditions than its enemies can have expected and than even its friends could have hoped for.
The Nicaraguan Government have reopened La Prensa, they have reopened Radio Cattolica, they have lifted the state of emergency, they have conducted talks with the Contras on remarkably generous terms and the ceasefire agreement has taken place. All of that has not induced one word of approval, let alone help, from Britain. Indeed, last year, as the Minister for Overseas Development admitted a few days ago, not one penny of bilateral assistance was provided by Britain for war-torn and impoverished Nicaragua.
I suppose that that kind of silence is better than the feverish activity of the American Administration and President Reagan's obsessive, though happily unsuccessful, attempts to fund the murderous Contras, and now Mr. Shultz's tour of central America. His 53-hour tour, codenamed "If it is Thursday it must be Tegucigalpa", misses out Nicaragua altogether. As Mr. Shultz is at any rate going to El Salvador, I hope that he will take the opportunity there to demand the firmest possible guarantees of the safety of the leaders of the freedom movement, including Mr. Ungo, who has now courageously returned to El Salvador, where he is risking murder at the hands of that country's murderous death squads.
Mr. Tony Banks: Does my right hon. Friend accept that it is a matter of great hypocrisy on the part of the British and United States Governments that all we hear from
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them is criticism of and attacks on the Nicaraguan Government in their attempt to get peace in their country, and that we rarely hear a word about the death squads in Guatemala, Honduras, El Salvador and Colombia? One could give a list of countries in that part of the world which have been supported by the British and American Governments, who have merely attacked the Nicaraguan people who are looking for peace within their borders.
Mr. Kaufman: I agree with my hon. Friend. Earlier, the Foreign Secretary was interrupted by the hon. Member for Leicestershire, North-West (Mr. Ashby) who went to Nicaragua as an observer of the elections there. He came back praising the conduct of those elections. It is a bit thick of the Foreign Secretary to say that he wants there to be a pluralistic democracy in Nicaragua when, of the five countries which are party to the accord, apart from Costa Rica, Nicaragua is the only one with a semblance of pluralistic democracy.
Mr. Ashby: Does the right hon. Gentleman recall that although I praised the election—the fact that it was the first election and therefore a very necessary part of the democratic process in Nicaragua—and although I said that the election was secret and well conducted, I felt that to talk of it as a pluralistic election as rather like saying that the elections in Poland were pluralistic, free and fair? I was misquoted in respect of that election.
Mr. Kaufman: I accept what the hon. Gentleman says. No one is pretending that in a country that is labouring under a state of emergency the kind of pluralistic democracy to which we aspire in this part of the world can be attained. However, there is no doubt that the only country in the whole of central America, apart from Costa Rica, that has any genuine pluralistic political system is Nicaragua, and it is about time that the Government recognised that.
There is one area where the Foreign Secretary has acted and where we share his approach. It is the middle east. I am sorry that the right hon. and learned Gentleman did not find time to deal with it at greater length. Apart from the issues of South Africa and of East-West relations, it is probably the most important problem in the world and one more fraught with danger to world peace than any other. The past seven months have seen the start and the remarkable continuance of the Intifada—the uprising by the Palestinians in the territories that the Israelis occupied 21 years ago this month.
Opposition Members have long taken the view that the only formula for a settlement in the middle east is on the basis of the United Nations resolution calling for peace in exchange for territory—for Israel to withdraw from lands that she occupied in 1967 as part of a firm agreement that will guarantee Israel's security. Opposition Members believe—I think that the Government share this view— that such an agreement can be brought about only under the umbrella of an international conference sponsored by the five permanent members of the security council of the United Nations. All the Arab nations support such a conference. They made that clear at this month's Arab League summit in Algiers, on which I had the advantage of a first-hand report from the Foreign Minister of Algeria, with whom I had talks in Algiers two weeks ago.
In recent months, I have had talks with King Hussein of Jordan, President Mubarak of Egypt, Mr. Chedli Klibi, the secretary-general of the Arab League, and Mr. Farouk

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Khadonmi, the foreign affairs spokesman of the PLO, as well as talks with Arab leaders in Baghdad, Tunis and elsewhere. In quest of further information I shall shortly be visiting another indispensable participant in any settlement when I go for talks in Damascus that I have arranged with the Syrian Government. [Interruption.] Is the hon. Member for Mid-Norfolk (Mr. Ryder) saying that I shall not get information when I go to Syria? Is he saying that there is no chance of a settlement? If he is saying neither of those things but is calling out some other nonsense, I advise him, as a Whip, to keep his peace. This is a very serious matter on which the Foreign Secretary and I are working together. The Opposition are trying to assist the Government in doing something about this extremely dangerous situation. Perhaps the hon. Gentleman, who is capable of a degree of mental agility, will do that too, instead of sitting there and snarling.
An international conference with territory exchanged for peace is vital, and it is admirable that this policy is also the wise and courageous policy of Mr. Peres, the Foreign Minister of Israel and leader of the Israeli Labour party. It is tragic that such a policy, which is supported in so many quarters, is being obstructed by the folly and intransigence of Mr. Shamir, the Prime Minister of Israel. He poses as the defender of Israel's security. In fact, the policy of a greater Israel which he is pursuing is the greatest enemy of Israel's security. The security of Israel does not depend only on the possession of land. Surely, in this, Israel's 40th anniversary year, the people of Israel must know that the armed possession of the whole of mandatory Palestine for more than half the period of their country's statehood has not brought them peace. Instead, it has brought war upon war and death upon death, with too many of Israel's citizens buried in military and civilian cemeteries instead of living hopeful and fruitful lives.
If the Israelis had not learned that lesson a year ago, they surely know it now. The Intifada, the uprising, has permanently changed the history of the middle east. There will never again be peace in the occupied territories. There will be peace in those territories only when they cease to be occupied. More than 200 Palestinians have died to explain that simple fact. Thousands more have been injured and thousands more imprisoned. It is clear that thousands more Palestinians are willing to risk or give up their lives despite the force of the Israeli response.
Already, hundreds of thousands of decent, sensible Israelis are campaigning against the policies inflicted upon them by the bizarre pantomime camel of a Government in their country. They know that it is not only in the interests of Palestine but even more in the interests of a peaceful and secure Israel that a negotiated solution should be achieved. I hope that hundreds of thousands more Israelis will show their good sense in this autumn's election by voting for justice for their neighbours and peace for themselves. The alternative is a Government with a Likud majority. If they went ahead with a transfer of population—a synonym for the mass deportation of Arabs which some of the Likud leaders are now discussing—it would make Israel the loneliest country in the world instead of the pillar of democracy that Israel's best citizens rightly wish her to be.
Mr. David Tredinnick: Is the right hon. Gentleman aware that one of the Palestinians to whom he spoke, who was a representative of Palestinians in the
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occupied territories, was arrested for talking to him? That was discovered by the all-party group of Members of Parliament who went to the occupied territories after his visit.
Mr. Kaufman: Such reports have been made to me and I have made inquiries of the Israeli embassy on a number of occasions about that individual. To date, the Israeli embassy has denied the information given to me, but I assure the hon. Gentleman that if I receive more information I shall put it to the Israeli Government again. I would regard it as absolutely intolerable that somebody should be arrested and imprisoned because he had spoken to me while I was on a visit to a refugee camp in the occupied territories.
Mr. Winnick: I agree with what my right hon. Friend has just said. The Palestinians undoubtedly made major errors, to say the least, which led to the situation in 1948 when they refused to accept the United Nations resolution and in 1967 when they provoked the war. I believe that Israel was absolutely right in 1967. However, is not the Israeli leadership making a similar mistake at the very time when the Palestinians have come round to recognising that there should be an Israeli state? The leadership of Israel—unfortunately, a large number of people agree with the leadership—refuses to recognise what must be recognised, which is that the Palestinian people have as much right to justice and a state of their own as the people of Israel.
Mr. Kaufman: At this stage of the crisis it is an error on both sides to look back and seek justifications and arguments from the past. We are where we are: 1,300,000 Palestinians have been denied civil and human rights for 21 years by an occupying power. Israel is not living in peace partly because of that situation. It is essential that we look forward. The Government and the Opposition are united on that, even though we have serious differences on many other issues, with which I must now deal.
If the Foreign Secretary has been precise and uncontroversial in many of his pronouncements on the middle east, he has been far less precise and much more controversial in what he has said, and failed to say, about what took place in Gibraltar on 6 March this year.
This House is united against IRA terrorism, of which we have witnessed so many foul examples during the past few months. The House breathed a sigh of relief when the plot to commit an abominable atrocity in Gibraltar was detected and prevented. The House took the Foreign Secretary's word next day when he gave, in total good faith, his account of the events leading to the killing of the three IRA terrorists in Gibraltar. But it was The Daily Telegraph, in a leading article on 8 March, which summed up the worries that have arisen:
"The Government must tell why it gave a succession of contradictory accounts to the world about Sunday's events. Unless it wishes Britain's enemies to enjoy a propaganda bonanza, it should explain why it was necessary to shoot dead all three terrorists on the street, rather than apprehend them with the considerable force of police and SAS which appears to have been deployed in the locality … it might be deemed politically prudent to give ill-wishers no further grounds to suggest that the authorities operate a "shoot to kill" policy against terrorists."
When the Foreign Secretary spoke to the House, not in a statement that he volunteered, but in response to a private notice question from the Opposition, the state of our knowledge, all of it derived from Government sources, was as follows. Two men and one woman in charge of a car

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parked 500 yards from where a changing of the guard ceremony was due to take place had been shot dead by security forces after having planted in their car a 500 lb bomb which members of the East Anglian Regiment swiftly defused. Next day, when it must have been known that parts of this account were untrue, the Minister of State for the Armed Forces was still telling listeners to the BBC "Today" programme:
"A car bomb was found and defused."
The Foreign Secretary—I am sure inadvertently—added to that disinformation by telling the House that afternoon:
"Their"—
that is, the three terrorists'—
"presence and actions near the parked Renault car gave rise to strong suspicion that it contained a bomb, which appeared to be corroborated by a rapid technical examination of the car."—[Official Report, 7 March 1988; Vol. 129, c. 21.]
But we now know that such a rapid technical examination could not have revealed what the Foreign Secretary said and must have revealed the reverse, because the car could not, in the condition in which it was seen, have contained a device of 500 lb of explosives or the device of 140 lb of explosives that was found somewhat later 40 miles away in a parked car in Marbella. Indeed, the Foreign Secretary admitted fairly:
"It has now been established that"
the car
"did not contain an explosive device."—[Official Report. 7 March 1988; Vol. 129, c. 21.]
Again, the right hon. and learned Gentleman admitted openly and without equivocation in a letter to me:
"I can say that it was not until the morning of 7 March that full confirmation was finally received in London that the parked Renault car contained no explosive device, and I only learnt of it personally after lunch that day, when I returned to my office from a morning engagement outside the FCO."
Describing what he then believed to have taken place, the Foreign Secretary went on to say in his statement to the House:
"On their way towards the border, they"—
the terrorists—
"were challenged by the security forces. When challenged, they made movements which led the military personnel operating in support of the Gibraltar police to concude that their own lives and the lives of others were under threat."—[Official Report, 7 March 1988; Vol. 129, c. 21.]
But the question is: were they challenged? The Foreign Secretary has been asked again and again by others and by me about whether they were challenged. He has persistently declined to respond to such questions—
Sir Geoffrey Howe: I must confess that many would join me in a sense of dismay that the right hon. Gentleman chooses to embark on a piece of investigative journalism of this sort. He has been kind enough to acknowledge that, in my statement to the House that day, I spoke in complete good faith—as was the case—as the House would have expected me to tell it all I knew at that time.
The matter is now for investigation in the court hearing that is to follow in due course. It really cannot help to try to pursue this matter as though the right hon. Gentleman were back in his old profession as an investigative
journalist.
Mr. Kaufman: I am sure that the right hon. and learned Gentleman—
Mr. John Carlisle: Traitor.
Mr. Tony Banks: On a point of order, Mr. Deputy Speaker. I distinctly heard the word "traitor" used by the hon. Member for Pembroke (Mr. Bennett) about my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman). [Interruption.] I am now assured that it was the hon. Member for Luton, North (Mr. Carlisle). Conservative Members know who it was, in any case. If there is any honour left among them, which I doubt, that comment should be withdrawn.
Mr. Deputy Speaker: I did not hear the word. I was concentrating carefully on what the Foreign Secretary was saying. But if the word was used, it must be withdrawn.
Mr. Nicholas Bennett: Further to that point of order, Mr. Deputy Speaker. I assure you that I said nothing at all.
Mr. Max Madden: Further to that point of order, Mr. Deputy Speaker. I heard the remark—it was made by the hon. Member for Luton, North (Mr. Carlisle), who is sitting grinning at the back of the Chamber. In view of recent remarks made about his activities in the House I think that he should have the honour to withdraw his remark.
Mr. Deputy Speaker: Order. Perhaps I should ask the hon. Member for Luton, North (Mr. Carlisle) whether he used the word. If he did, I am sure that on reflection he would want to withdraw it.
Mr. John Carlisle: I happily withdraw the word "traitor" and substitute the word "Quisling".
Mr. Deputy Speaker: Order. I am afraid that that is no more acceptable. The hon. Gentleman must give an unqualified withdrawal.
Mr. Carlisle: In deference to you, Sir, and the House I withdraw the word "traitor" in that context
Hon. Members: And "Quisling".
Mr. Deputy Speaker: The hon. Gentleman must withdraw both words.
Mr. Carlisle: In deference to the House and to you, Sir, I withdraw the words "traitor" and "Quisling".
Mr. Kaufman: I am obliged to the hon. Gentleman. I would never dream of describing him as a traitor to the apartheid principles of South Africa, and he can rest assured that I shall make no such accusation against him inside or outside Parliament.
As for what the Foreign Secretary said, I do not question for a moment the complete sincerity and integrity of his remarks and whole approach to this matter when he made his statement to the House. I never implied that I did. Whether he regards it as appropriate for a speech in a foreign affairs debate to deal with an issue that has seriously affected relations between this country and the Republic of Ireland is for him to decide. He said that these matters should be pursued in other ways, but it was he who volunteered, in response to my hon. Friend the Member for Hamilton (Mr. Robertson) on 7 March, the remark.
"The matter, of course, will be subject to further amplification as further evidence becomes available".—[Official Report, 7 March 1988; Vol. 129, c. 23.]
We are waiting for that further amplification, which the right hon. and learned Gentleman did not put into the context of an impending inquest, although he knew as a

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lawyer, if anyone did, that an inquest was sure to follow. Nevertheless, he offered the House further evidence, about which I am seeking to question him. I insist on doing that.
It is crucial to know whether these people were challenged, and efforts have been made in the House and elsewhere to obtain the truth about that. Efforts have been made to discover under what rules the security forces—that is what the Government call them, although everyone knows that they were the SAS—were operating. That they were operating under rules has been made clear by the Minister of State, who gave a reply to the House on 24 May:
"All military operations and activities in this country or by our armed forces are ultimately under political control. I should emphasise that our soldiers are highly trained to operate within the law and according to strictrules."— [Official Report, 24 May 1988; Vol. 134, c.185.]
We want to know—we have the right to know—whether they were operating under strict rules and what those rules were. We know of the yellow card rules that are laid down for Northern Ireland. Were the same rules operative in Gibraltar on 6 March? Were they observed? Was there a decision not to observe them? If so, it was not made on the spot but by the political control under which the Minister of State made it clear that they were operating. The Government refuse to provide a morsel of information, claiming that to utter a word would prejudice the forthcoming inquest in Gibraltar. However, as I pointed out, the Foreign Secretary offered no such proviso when the matter was discussed in the House on 7 March.
We also want to know when the inquest will take place. That is another mystery. First, it was said to be scheduled for last month, then it was definitely fixed for 27 June. It was then postponed indefinitely. News of the postponement did not come from the coroner in Gibraltar, Mr. Pizzarello, but from the Prime Minister's Press Secretary in London, Mr. Ingham, who, in his non-attributable Lobby briefing at 11 am on 23 May, told journalists that the inquest would be postponed from 27 June.
Three hours after Mr. Ingham told journalists that the inquest would be postponed, Mr. Pizzarello denied that he had postponed it. Two hours later, he postponed it. It has still not been explained why Mr. Ingham knew for a fact what was denied three hours later, which was then confirmed two hours after that on the grounds of the need not to distract police attention from a music and dance festival in Gibraltar—[Interruption.] These are matters of profound concern to the press of this country and to The Daily Telegraph among other newspapers. Attempts by Conservative Members to prevent questions being put will not succeed.
The festival due to which the inquest was postponed took place this week. We now know what kind of festival it was which placed such demands on the police that it made it impossible for the inquest to be held. The festival events that were thought to need a massive police presence, included a painting exhibition, a rowing race, flower arranging and a performance by a group of artists known as the Dollydots—[Hon. MEMBERS: "Trivial."] What happened in Gibraltar was not trivial. If the Foreign Secretary regards that as so trivial, why did he ask me not to proceed?
The festival organiser said:
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"We are being blamed for having the inquest postponed. That's nonsense. We just did not have that power. We are just amateurs trying to bring a little culture to Gibraltar."
The Dollydots did not have the power to postpone the inquest: someone else did, but we still do not know who.
That conundrum, together with other unexplained events, has caused great damage to Anglo-Irish relations. The Foreign Secretary admitted that when, following the incident, he said:
"I do not underestimate the hurt felt by the Irish in recent months … Let me make it clear that for our part any hurt is not intentional. It is not calculated. There is no conspiracy."
The problem was that, while the Foreign Secretary was trying to reassure the Irish Government, the Prime Minister was almost simultaneously insulting the Irish Government and accusing the Prime Minister of the Republic of backing away from responsibilities under the Anglo-Irish Agreement. The problem for the Foreign Secretary is that again and again when he has tried to maintain a sensible policy, he has been sabotaged by the Prime Minister, acting as an unguided missile, which, unfortunately, will not be done away with under the INF agreement.
When the Foreign Secretary and his Department were negotiating the agreement on Hong Kong with China, which was a great diplomatic achievement for the right hon. and learned Gentleman and his Department, the Prime Minister nearly wrecked it by her crass and ignorant intervention. When the Foreign Secretary is still trying to repair the damage done by the Prime Minister's tendentious briefing against Canada at last autumn's Commonwealth conference, last week in Ottawa, the Prime Minister caused fury in the Canadian Parliament by taking sides in an internal Canadian political controversy and, as one Canadian parliamentarian put it "meddling in Canadian affairs".
The Foreign Secretary has to stand by and watch the Prime Minister trying to sabotage the most helpful development in world affairs in the past 40 years—the disarmament process that is now taking place between the Soviet Union and the United States.
The right hon. and learned Gentleman referred to the Communist party congress taking place in Moscow this week. It must be peculiarly galling for the Prime Minister to see the admirable and remarkable efforts by Mr. Gorbachev to create more democratically elected institutions in the Soviet Union, when she is busy abolishing democratically elected institutions in the United Kingdom. It must be infuriating for the Prime Minister to see the Soviet leader earnestly seeking to create a more open and freely spoken society through glasnost while she pursues her objectives of creating a closed society in this country through her vendettas against the broadcasting organisations.
Worst of all is the Prime Minister's failure to respond to the magnitude of developments which could rid the world of the menace of war. At a time when our Select Committee on Defence provides figures on Britain's naval strength which are different from and fewer than those botched together by the Secretary of State for Defence, the Government have turned down Mr. Shevardnadze's excellent proposal for a formal exchange of official data on conventional forces. At least if we took up that offer, the British Government and the Ministry of Defence might have a chance of finding out exactly how many ships there are in the Royal Navy, which they do not seem to know at the moment.

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The Prime Minister is not only at loggerheads with the Foreign Secretary; she is also at loggerheads with Chancellor Kohl of West Germany. He wants to reduce battlefield nuclear weapons in Europe, while she wants to modernise NATO's nuclear capability. Happily, he managed to defeat her at the NATO summit on that issue in March.
The Prime Minister is even at odds with President Reagan. In her notorious interview with Der Spiegel last autumn, she said that disarmament
"ought not to go much further, at least until we have achieved a ban on chemical weapons and an approximate equilibrium in conventional weapons".
In his walkabout in Red square during the Moscow summit, President Reagan made it clear that he wants the world's nuclear arsenals to be fully eliminated during the next 12 years. Even the Foreign Secretary has pointed out today that strategic arms negotiations are under way, which is against the wishes of the Prime Minister who did not want strategic arms reductions to take place until after there had been progress in conventional disarmament and chemical warfare—[HON. MEMBERS: "Quite right."] Hon. Members may say, "Quite right," but they disagree with President Reagan who is pursuing a START negotiation which he hopes to conclude with Mr. Gorbachev before he leaves office at the end of this year.
The most repulsive stand taken by the Prime Minister and carried out reluctantly or otherwise by the Home Secretary is on South Africa. The whole record of this Government on apartheid is shoddy, as at this moment is their record on the plight of the Sharpeville Six in the light of the international discussions in which they have been involved in the past few weeks. The Sharpeville Six are once again under threat of potential imminent execution.
The line that Ministers are being required to take was revealed by the Prime Minister in a written answer to my hon. Friend the Member for Walsall, North (Mr. Winnick) on Monday. She stated:
"It would be premature to consider intervening again with the South African Government before the legal processes are exhausted."—[Official Report, 27 June 1988; Vol. 136, c. 1.]
In recent weeks, on that legalistic pretext, the Prime Minister and the Foreign Secretary have been zealous in obstructing, frustrating and sabotaging the efforts of the leading nations to obtain a reprieve for the Sharpeville Six.
Sir Geoffrey Howe: The right hon. Gentleman continues to live in a world of fantasy, so I shall put him right. The right hon. Gentleman was not here this afternoon when my right hon. Friend the Prime Minister dealt with this matter. As a result of three meetings that I have attended—first, with the European Foreign Affairs council in Luxembourg, secondly at the Toronto Summit a fortnight ago and, thirdly, this week in Hanover—we have joined in making clear representations to the South African Government calling for clemency to be exercised and for the use of all available legal remedies to that end. We wish clemency to be exercised. The Prime Minister made it plain this afternoon that she had made representations already.
When the judicial processes have been exhausted—the stay of execution has been extended until 19 July—yet again we shall intervene and ask for clemency to be exercised. We choose these methods because it is our firm and clear judgment that they are most likely to have the impact that the right hon. Gentleman and the House wish. That is the only reason why we choose to proceed in this
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fashion. If the right hon. Gentleman believes that the ultimate judgment of state President Botha will he more influenced in the right direction by coupling representations with threats, he has completely misjudged the target of his representations.
Mr. Kaufman: I was present this afternoon when the Prime Minister responded to my right hon. Friend the Leader of the Opposition on this issue. What she said did not accord with reports in the press. I shall quote from The Daily Telegraph of Friday 24 June.
Sir Geoffrey Howe: It is not true.
Mr. Kaufman: The right hon. and learned Gentleman can get up and say that it is not true when I have read it out, but he should allow me to read it. The article says:
"Last week, Herr Hans-Dietrich Genscher, West German Foreign Minister, was reported to be enraged when Sir Geoffrey Howe, Foreign Secretary, tried to block a joint declaration by the Twelve on the fate of the Sharpeville Six … The statement was issued, after Herr Genscher insisted that the EEC's credibility was at stake, though Britain succeeded in watering it down."
The article says that the declaration to which the right hon. and learned Gentleman referred
"urged that 'all legal options available in South Africa should be used to prevent the death penalty being carried out'. However, it did not call on President Botha to exercise clemency, as some member states had urged."
I have an article from The Independent, on which the right hon. and learned Gentleman seemed to place great credence, headed;
"Britain halts EEC move for Sharpeville Six reprieve."
Yes, statements were made in Luxembourg, Toronto and Hanover, but in almost every case they were not the statements that the majority of those taking part wanted because the right hon. and learned Gentleman, acting on the Prime Minister's instructions, sabotaged them.
Chancellor Kohl has spoken about withdrawing his ambassador and about diplomatic sanctions. The right hon. and learned Gentleman has prevented such measures being taken, and I am sorry that he continues to take a position that thwarts the wishes of the Twelve and those of the major economic powers that met in Toronto, to give a full-blooded condemnation of the execution of the Sharpeville Six. We all know that, every newspaper knows it and the Foreign Secretary carefully chose his words and denied that he and the Prime Minister had prevented action being taken by Chancellor Kohl, President Mitterrand, the Dutch and all the others who care about this matter.
I know that the right hon. and learned Gentleman and his right hon. Friend the Minister of State hold different views on this matter to the Prime Minister. Unfortunately, the Prime Minister calls the tune. Even at this late stage, we call on the Government not simply to use this legalistically phrased terminology but to do what everybody has asked them to do. The Prime Minister should get on the telephone to President Botha and make it clear—using the much-vaunted influence that she claims to have with Pretoria—that she wishes the South African Government to abandon this appalling campaign against those innocent people.
The problem that the right hon. and learned Gentleman has with the Sharpeville Six, as in many other matters, is that he is not allowed by the Prime Minister to follow his own sensible and creditable instincts. On so many issues, he makes it clear to the House that he is a decent and

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humane man, but his decent and humane instincts are constrained by the Prime Minister's cheap and ugly prejudices.
Crucial events are happening throughout the world. Britain should be active in hastening and supporting what is good and seeking to change what is wrong. The Foreign Secretary, from time to time, does his best, and I wish him well in his efforts. Meanwhile, the House must watch and seek to correct what goes wrong. That is what debates such as this are about and I hope that we will have more of them more speedily in the future.
Several Hon. Members rose—
Mr. Deputy Speaker: Order. Between 35 and 40 right hon. and hon. Members wish to take part in the debate. I am sure that short speeches will be appreciated.
6.6 pm
Mr. Edward Heath: My right hon. and learned Friend the Foreign Secretary rightly concentrated on the agreement signed in Moscow by the two super-powers. It might perhaps have been more helpful to the House if the right hon. Member for Manchester, Gorton (Mr. Kaufman) had followed that example. It is true that some of the points that the right hon. Gentleman made can be included in foreign policy, but to take up so much of the House's time was unjustifiable. All the matters could have been expressed very much more shortly. We all recognise the importance of trying to deal with the South Africans and we are all aware of the difficulties with Gibraltar, but they need not take up a large part of the debate.
I want to concentrate on the same subject as my right hon. and learned Friend. In so far as the Prime Minister and my right hon. and learned Friend were responsible for the success of the meeting between the super-powers—I know that my right hon. and learned Friend did an enormous amount of work behind the scenes—they are owed our gratitude and congratulations. It was a remarkable achievement, but I should like to put it in the context of the past 45 years. The Foreign Secretary emphasised the fact that we should look to the future and the impact that the agreement will have on it. There are, however, some lessons to be learnt from the past 45 years.
It seems to me that we have moved in cycles. After the iron curtain fell we had a period of tension, which almost broke out into warfare. After the death of Stalin in 1953, Mr. Churchill stood at the Dispatch Box and said that Stalin was dead and that the three powers that won the second world war—the United States, the United Kingdom and the Union of Soviet Socialist Republics—could once more come together. That took 10 years, and in 1963 we signed the first test-ban treaty. That was the beginning of a cycle that continued until 1979. It was a period of continued reduction of tension, and achievements were made in security. It reduced much of the testing of nuclear weapons, which were controlled under SALT 1 and SALT 2.
We then had another period of tension of six or seven years, in which both sides of the Atlantic abused the Soviet Union, for no point whatever. Perhaps we have now come to the end of that cycle and, the treaty having been signed in Moscow, are starting once again on a period in which
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we can move to a further series of treaties, with a reduction of tension and the benefits that flow from that. I have said before, when asked what the benefits of that reduction in tension were, that by 1979, 55,000 Jews were leaving the Soviet Union each year, but by 1985 only 500 were leaving. That is one of the consequences of reducing tension and getting workable arrangements with the Soviet Union.
Who can tell what will come out of the internal political reorganisation of the Soviet Union? That is not our affair, and I hope that we can stop lecturing the Soviets on what they should be doing. Least of all should we be telling them to copy the Westminster system. There is a lot in the Westminster system that does not appeal to anybody at the moment, and the last thing that we should do is to tell Mr. Gorbachev and Mr. Gromyko that this is what they must do. On the other hand, the consequences of that in Soviet foreign, economic and defence policy are matters of concern because of how we react to them. I agree with my right hon. and learned Friend the Foreign Secretary that here there is more room for hope than in many years past.
What are the implications of the changes that are being made? I was glad that my right hon. and learned Friend put so much emphasis on chemical weapons. I see no reason why there should not be a rapid agreement about the abolition of chemical weapons, under supervision, which the Soviet Union is prepared to accept. I am not clear where the obstacle lies, unless it is with the United States, which does not want to move quickly for fear of being accused of being reckless and not taking full note of the Soviet Union's power.
The same applies to the strategic defence initiative. The Soviet Union is prepared to give undertakings, and have them verified continuously, about research into SDI, and the quicker that both super-powers get away from that, the better it will be for their economies, budgets and trade and for the rest of us. I hope that those two objectives can be pursued speedily, as well as the rather longer discussions that my right hon. and learned Friend has said will have to take place. That will probably be a task for the next President of the United States. It is unlikely that the present one will abandon his dream fantasy of SDI and the abolition of all other weapons.
It is obvious that Soviet economic development will now move apace. It has been largely inspired by what is happening in the People's Republic of China, in exactly the same way as the People's Republic followed the example of Yugoslavia in changing its agricultural practices. Now the Soviet Union will follow the practices of the People's Republic and develop its agriculture as well as its industry. This will create a problem for the West, because the Soviet Union will no longer require to import vast quantities of grain, and that will greatly affect the middle-west farmers in the United States. This must be foreseen and the necessary adjustments to cope with it must be made.
Perhaps the biggest point is that the Soviet Union will want large supplies of new technology, technological equipment and capital investment, just as the People's Republic of China has been requiring them over the past 10 years. This can cause friction between Europe and the United States. This happened in the 1960s—and some of us had to handle it—when the United States was bitterly opposed to any increase in trade with the Soviet Union, even though we were in a period of diminishing tension. So often the United States objects until it is prepared to seize the market, and then it goes in and changes the rules.

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The European Community and Britain should be unequivocal about this. We should supply equipment to and go for capital investment in the Soviet Union and increase our trade with the Soviet Union. That would be for the benefit of both of us. There are those who already say that if the Soviet people become better clothed, better housed and better fed, they will become even more dangerous. This is not a philosophy to which I can subscribe. I believe that if they are more satisfied and are prepared to accept their Government, in whichever form they emerge, then the Government are less likely to want exterior activities to remove attention from internal difficulties. We should be clear about this and firm in our attitude towards it.
What about the relationship of the Soviet Union with the People's Republic of China? This is already changing, and it has changed over the two years since Mr. Gorbachev has been in power. Trade between the Soviet Union and China has been increased, the border crossings have been reopened and the crossings have been considerable. Two of the three conditions laid down by Deng Xiaoping for an improvement in relations are being met. The first was withdrawal from Afghanistan, and that is under way. The second was withdrawal of the Vietnamese from Kampuchea, and that is under way. The third test is the reduction of Soviet forces along Chinese boundaries. The People's Republic has already reduced its forces by 1 million on the ground over the past two years. Therefore, it is in a position to negotiate with the Soviet Union, and this will reduce the burden on the Soviet Union's budget and economy as a whole.
Therefore, we must expect fresh relations to be built up between the Soviet Union and the People's Republic. I do not fear this, because I do not believe that there is any hope of relations between them going back to what they were before 1958—after the revolution in China and before Stalin withdrew support from China. This is a further development which we must expect and of which we must not be afraid.
The next implication is for Africa, and in particular Angola, which has already been mentioned today. I believe that the Soviet Union wants to disengage from Angola and its general position in relation to countries outside the Soviet union. Certainly, President Castro wants to withdraw his forces from Angola. These negotiations have been going on, and I know that my right hon. and learned Friend the Foreign Secretary has given them every help that he can. It has so worked out that the Cuban forces have achieved considerable successes since the negotiations began. This may bring it home to the South Africans that they will not be able to overwhelm Angola, that the best arrangement is for them to get out of Namibia, as they ought to have done decades ago, and to recognise that they cannot destabilise the African countries along their borders.
All this can be achieved if—but only if—the American President is prepared to put pressure on South Africa to do it. Some will say that it is unlikely that this will happen during an election year. That may be so, although Congress as a whole would like it done, and it may be that, if a Democrat President were to follow, all the pressure would be put on South Africa. Once that happens, the Cuban forces can be progressively withdrawn from Angola. It needs a firm undertaking that the South Africans will not be able to go back easily to renewing the work of destabilising Angola.
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That is another consequence of the changes in the Soviet Union's position. A further one, dealt with by the right hon. Member for Gorton, is Israel. I am certain that no solution can be found for the Israeli-Arab problem unless the Soviet Union is involved, because of its allies along the border. There can be no solution unless the American President is prepared to tell Israel that there must be a solution, and the nature of it.
The Soviet Union is prepared to try to solve the middle eastern problem because it regards this as the most dangerously explosive point in the world. I was told this frequently when I was in Moscow two weeks ago. Again, we have the question of the presidential election. President Eisenhower was the only President who was strong enough to stand up to the Israelis, and to do so a week before the presidential election. President Reagan has not been able to do that in his full term of office. We need to bring about a conference that does not necessarily include the Security Council, but involves all the countries in the area and the two super-powers. It must be at a time when the American President is prepared to say that there must be a solution that is acceptable both to the Soviet Union and to the United States.
In all these matters, the European Community can have considerable influence. For example, my right hon. and learned Friend the Foreign Secretary, during his term as President of the Community, reached agreement inside the Community, after a visit to central America, on a possible solution to problems in the Caribbean. It was a very far-sighted arrangement and did not discriminate between Nicaragua and the rest. That was certainly a basis for negotiation and a solution to the problems.
What is now required, especially if we can solve the Angolan difficulty, is a fresh approach to Cuba. That is something in which European influence must be brought to bear on Washington. Washington is perpetuating a row of more than 30 years, in which a ruthless authoritarian regime was put down by revolution. We must ask ourselves about Cuba's future. In many ways, it has become successful, certainly in agriculture, largely helped by the Canadians, and now in industry, largely helped by East Germany. But what has President Castro got left? He has been President for 30 years. He does not want to be dominated by the Soviets. He knows that he cannot capture south or central America. Only two things are left to him: to get on terms with the European Community and with the United States. Those are the two things that remain to him in what years of his presidency are left, and they may be considerable. Here again, after the presidential election, the European Community can have a considerable influence.
I want to conclude with a few words about the Community. My right hon. Friend the Prime Minister made her statement this afternoon about the Hanover conference. The Government are right to campaign in as big a way as possible for 1992. Alas, I am afraid that British business and industry have been slow to react to that—much slower than the French and Germans—but now, perhaps, we can get them on the move and ready to take the necessary steps to take advantage of it.
The reason why business has been slow to react is that, over the past decade, the Government have done so little to boost the European Community as a whole. What we have heard has been how we have managed to bash the

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other countries, win them over or outwit them, not the fact that we are a Community as a whole in which all our interests are involved.
I listened this afternoon to my hon. Friend the Member for Southend, East (Mr. Taylor) ask about the common agricultural policy, but I must say that British farmers have done extremely well out of the common agricultural policy. It is a question of telling those people across the Channel not that they must put their affairs in order, but that we are a part of them. What will happen to our farmers when we are lecturing the rest of them what they should be doing? That is where we have failed to treat the Community as our Community and as one whole.
It will not be easy to bring about 1992. An immense amount of willpower is required by the leaders and ourselves. The Prime Minister, in her statement today, said that the regulations that have so far been passed are of great interest and benefit to us. I hope that that does not mean that we shall try to obstruct the later ones. This is a Community and others must have their benefits as well as us. To have the idea that we get what we can and then obstruct is absolutely intolerable and cannot be accepted as the way to behave inside the Community. It is a question of compromise. Every community lives on compromise, and that is what is required in the European Community.
I am delighted that the present President of the Commission has been reappointed. He is excellent and has worked extremely hard. What worries me are the continuing reports—no doubt through the Bernard Ingham service— that Lord Cockfield is to be sacked. If that happens, it will be disgraceful. He has been an excellent Commissioner. He has earned the respect of everybody else in the Commission and in the European Community; and his intellectual work has been brilliant and is the basis of 1992.
I am sorry if my right hon. Friend the Prime Minister has been upset by any suggestion that he has made about VAT, but that is something to be negotiated. Certainly it is not justifiable to sack our own Commissioner. Commissioners, once appointed, are not the tools of Governments. They have a responsibility to the Community as a whole, and Lord Cockfield has discharged that duty admirably. I sincerely hope that the Foreign Secretary will assure his reappointment, because it is desirable.
Mr. Nicholas Baker: I am interested to hear my right hon. Friend's comments. Does he welcome the news this week that, whereas 15 per cent. of business men in this country were aware of 1992 four or five months ago, this week the figure has reached 75 per cent.?
Mr. Heath: I welcome that increase. I was in the United States recently when a public opinion poll was published, saying that only 2 per cent. of the American people knew of the existence of the European Community or where Europe was. They have a much greater problem than we have.
I want to come to the question of European defence because, quite apart from Europe 1992, there is the development of the defence issue with the French and Germans. Of course I do not agree with what the hon. Member for Bolsover (Mr. Skinner) was shouting out,
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during the Prime Minister's statement, about what happened in the war. Perhaps those of us who fought through the war have rather better judgment of those matters than he has. After Reykjavik, the French and the Germans quickly concluded that they must work for the defence of Europe. It is our failure if we remain outside that. That goes back to 1950. We failed then to take any part in the initial stages of the first Community—the European Coal and Steel Community—and look what we lost. It took us until 1972–22 years—before we did anything.
Once again, we are standing on the sidelines with the French and Germans working for military defence in Europe, saying, "Let's wait and see if anything happens," or, "Well, it's not quite nice to have military defence in Europe." We must act on that.
Mr. John Wilkinson (Ruislip-Northwood): In view of the fact that the United Kingdom is to assume the presidency of the Western European Union from tomorrow, 1 July, does my right hon. Friend hope that the Spanish and Portuguese will be allowed to join the WEU, as they wish to do?
Mr. Heath: That is a rather old argument. I am perfectly happy for the Spanish and Portuguese to join the WEU, but it has always seemed to me that the WEU was created for one central purpose—to bring the Germans back into the European family from the point of view of defence. We have succeeded in that. I do not believe—it may be a wrong judgment—that the way to look after European defence in the future is apart from the Community and in a separate WEU. It is essential that we keep Heads of Government and Ministers concerned with the European Community, but I am perfectly prepared to accept the immediate point.
Mr. Harry Cohen: Will the right hon. Gentleman give way?
Mr. Heath: I was trying to be brief.
Mr. Cohen: The right hon. Gentleman talks about the European defence force that Britain should join, along with France and Germany. Will he kindly tell the House against whom he thinks those weapons and forces should be targeted? Is he saying that they should be targeted against the Soviet Union? If so, that is just another arm of the cold war.
Mr. Heath: I can assure the hon. Gentleman that the Soviet Union accepts that we have forces, in the same way that it has forces. It does not take exception to that. It is trying to reduce the scale of its forces and our forces for the mutual benefit of both of us. That is perfectly justifiable.
I wish to turn to one or two other aspects of the Community before I finish. We shall not be able to stop at 1992. We must move on to a monetary union. Two things are vital. The first is that Britain should become a full member of the European monetary system. The Treasury wants it, the Bank of England wants it, the Confederation of British Industry wants it, the chambers of commerce want it and the business world wants it because it will stabilise our currency. The Prime Minister does not want it.
My view is quite clear. The Prime Minister should accept that we should become a full member of the European monetary system. It is said that that will take

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away some little grasp of power that we still have. That is irrelevant. Look at black Monday and what followed from it. How can any country stop these things happening by confining itself to its own small system? Of course it is not possible to do that. The stock exchange followed Wall street and then the Hong Kong market had to be closed. Tokyo and Singapore were affected. With its communications, the modern world is different from the one which preceded it.
I believe that we should go into the EMS for stabilisation. If we had gone into it in 1979, we would never have had sterling rising to $2·20, as it did in 1980. We lost 20 per cent. of our industry because of the value of sterling. If we had been a member of the EMS, sterling would not have declined to $1·05, as it did in 1985–86. We are all aware of the calamities that that brought about. We want stabilisation.
There are those who say this is impossible. The Chancellor of the Exchequer was trying informally to stabilise on the deutschmark without formalising membership of the EMS. He was succeeding up to a point. The Prime Minister then said, "You cannot buck the market." The Chancellor of the Exchequer said, "I am stabilising." What does the market do? It is in complete confusion. It asks itself, "What are we supposed to do? Are we supposed to stabilise or are we expected to speculate and move up as far as we can?" With membership of the EMS we would gain stability, which would be of benefit to our industry and exports.
Monetary union was agreed in 1973, and it has been worked out ever since then. Much has been done to formulate how we shall achieve monetary union and a common currency. It is perfectly possible to achieve these things, but before that we can have a European central bank. I was astonished by the response of my right hon. Friend the Prime Minister when the right hon. Member for Plymouth, Devonport (Dr. Owen) asked her a question about a European independent central bank. My right hon. Friend said that that
"would only come about with the dissolution of this House".—[Official Report, 23 June 1988; Vol. 135, c. 1255.]
We can have a European bank only if Parliament is abolished. That is an intellectual fallacy of such enormity that I find it impossible to see how it can be removed, except by a complete process of re-education. All the structures of the European Community are based on having institutions that serve all the member countries but do not involve the abolition of parliaments. To say that to have a central bank in Europe must mean the abolition of the House is fantasy of a scale hitherto unknown in public. I hope that my right hon. Friend will feel able to change her view. Let us develop a central bank. It will be to our benefit to do so. Let us proceed to monetary union. Before that, let us join the EMS.
My final remarks relate to Europe and the international order generally. Many of us were greatly concerned when the Government withdrew from UNESCO. At least, we said to ourselves, "They are not satisfied with its conduct." I have always believed, however, that if someone is not satisfied with an organisation or institution, he or she should stay within it and try to put it right. Instead, the Government withdrew. The present Secretary-General of UNESCO is trying to put things right. What is the Government's attitude towards that? We shall be in a much stronger position if we help him to put the organisation right. I hope that the Government will forgo
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their distaste for cultural and intellectual pursuits, return to UNESCO and try to persuade the Americans to return as well.
The implications, which I have outlined, of the Soviet changes are considerable and I hope that we can pursue them. Europe can have an immense influence in handling the changes. To do that, we must play a full part as a member of the Community. We cannot expect the others to take any notice of what we say if we are not a full member of the EMS. They will say, "You are trying to get all the benefits and squeeze as much as you can out of us without taking any of the responsibilities." That is no way to influence others in the international order. There is enormous scope for us in Europe if we act as a full member of the Community. I hope that we can take advantage of it to follow up the implications of the changes that are now taking place in the Soviet Union.
6.35 pm
Mr. Denis Healey: First, I congratulate the Foreign Secretary on surviving two gruelling periods of intimate contact with the Prime Minister in foreign parts. He has weathered the right hon. Lady's disapproval and he is actually fighting back. We wish him well in the fight, but I assure him that we shall do so discreetly. I am not sure that vociferous support would do him any more good than the support of the right hon. Member for Old Bexley and Sidcup (Mr. Heath) will do for Lord Cockfield. We shall see.
I shall confine my remarks to what I think is the central issue that is now facing us and the world, which is how we in the West react to the enormous changes that are taking place in the Soviet Union. I have had the advantage of 12 hours' personal discussion with Mr. Gorbachev over the past few years, and I believe that that is exactly the same number of hours that the Prime Minister has spent with him. I hope that I may have learnt a little more than the right hon. Lady because I allowed him to get in a word occasionally.
When the new phenomenon arrived in Moscow, the Establishment throughout the Western world was inclined to brush off what he was saying and doing. It was said, initially, that it was a cosmetic propaganda exercise that was intended to put the West off its guard. It was admitted rather grudgingly about a year ago that he might be sincere in what he says he wants, but as he is not prepared to change the system there is not much chance of hire succeeding.
It is clear this week that Mr. Gorbachev intends to change the political system in the Soviet Union, as well as the economic system, and commit himself even to a broad-ranging rewriting of the Soviet constitution. As the right hon. Member for Old Bexley and Sidcup rightly said, that does not mean that all the changes that Mr. Gorbachev wants are ones of which we would approve. He will not necessarily follow our model. There is no doubt, however, that he has embarked on an enterprise which, if he succeeds, will be even more far-reaching than the effect of the reformation on the Christian Church, because there will be no old Church left if Mr. Gorbachev's reformation succeeds.
It requires enormous confidence to feel that he will succeed in making some of the changes that he proposes. He faces the opposition of a corrupt and incompetent bureaucracy in both the state and the party machines. He

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faces also a large degree of cynicism among the Soviet people, which under glasnost is now reflected in opinion polls that are being published in Soviet newspapers. However, he is clearly determined to succeed. No Soviet leader since Lenin has consolidated his power in the main organs of the Soviet system as rapidly as Gorbachev has over the past three years.
The most exciting feature of the events of this week, as my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) has said, is that Gorbachev seems determined to mobilise support among the public through new elected institutions that will be a second source of influence along with the party and the state machines. As my right hon. Friend said, there is an extraordinary contrast between the centralisation of power in Britain, with our Prime Minister's determination to destroy every institution that is capable of standing up to her diktat, and the course that is being adopted by Mr. Gorbachev.
Members of the Prime Minister's Private Office have far more influence on Government policy than any members of her Cabinet. Parliament is rejected and takes a secondary place. Local government is being abolished. Even the Foreign Office sits quivering in the Box, knowing that it is regarded as a hostile element. The Treasury is almost beyond the pale. If the right hon. Lady continues for much longer, I do not think that there will be any of our institutions left except MI5 and the SAS.
Sir John Stokes: I admire the right hon. Gentleman very much. Like him and my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath), I fought in the last war. However, the right hon. Gentleman must be slightly mistaken about my right hon. Friend the Prime Minister. If she is as bad as he says, why are the Conservatives leading by 12 points in the opinion polls?
Mr. Healey: There are many answers to that, which I shall not explore.
The right hon. Member for Old Bexley and Sidcup made a very important point. We cannot guess whether Gorbachev will succeed in his domestic objectives. However, there is much more reason to be confident that he will succeed in his external objectives. Foreign policy in the Soviet Union, as in most countries, is made by a handful of people. In the Soviet Union that takes place in the Foreign Office and in the international secretariat of the Central Committee. All those people have been changed since Gorbachev came in. The old guard has been replaced with men of extreme intelligence and wide experience. The old guard has no political clout, unlike the people being removed from some of the big state enterprises and the domestic departments.
Moreover, even if Gorbachev were to disappear from the scene, I believe that the objective factors which have produced the change in Soviet policy will maintain the change. Above all, the Soviet Government—and the American Government—have recognised that nuclear winter and Chernobyl have rammed home the fact that there cannot and must not be a nuclear war and that there must also never be a large-scale conventional war, at any rate between the super-powers. Gorbachev has made that point many times.
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The other great fact that will continue to determine Soviet foreign policy is that unless the Soviet Government can take resources out of defence spending and put them into investment and raising living standards, by the end of the century the Soviet Union will be Upper Volta with rockets. Soviet spokesmen have not used that particular phrase, but they have used similar ones and the concept is the literal truth. Gorbachev has been ramming that point home in speech after speech, not least in the speech that he made in Moscow a couple of days ago.
It is not sufficiently recognised that some of the compulsions are exerting themselves on the other great super-power. The United States is beginning to recognise that it does not have the economic capacity to dominate the world and that it will have to find some means of reducing its expenditure on defence. Whether Mr. Bush or Mr. Dukakis becomes the next American President, it is certain that the President will continue to cut defence spending as the United States Administration and Congress have been doing over the past two or three years.
Our great hope for the future is that the two super-powers are sufficiently conscious of the slow but inevitable decline in their relative influence on world affairs that they realise they have an enormous common interest in trying to create a framework of stability in which the world can live with the nuclear weapon and the new technologies, even when the duopoly, as we have come to regard it between the Soviet Union and the United States, is disappearing.
I would have thought, and I believe that the Foreign Secretary thinks, that Britain has an enormous interest in encouraging those new developments in the Soviet Union, in the United States and between the two. However, I am bound to say that some of the British Government's actions cast doubt on whether that is recognised everywhere. For example, this week, Jane's Defence Weekly gives a detailed report of the British Government's readiness to accept up to 60 F111 bombers armed with two to four cruise missiles capable, according to the American general's comments in Jane's Defence Weekly, of striking targets deep in the Soviet Union from their new bases in the United Kingdom.
I put it to the Minister of State that that is circumvention of the INF treaty. To replace land-based cruise missiles with air-based cruise missiles on aircraft based in the United Kingdom flies directly in the face of everything agreed between the United States and the Soviet Union over intermediate nuclear forces, which was endorsed by the British Government in NATO when NATO considered it. I hope that the Minister will comment on that. As I have said, there is a lengthy report on the matter in the current issue of Jane's Defence Weekly.
Mr. Keith Mans: Will the right hon. Gentleman agree that the INF agreement related to ground-launched missiles, not air-launched missiles? Is it not also true that the Russians already possess air-launched weapons?
Mr. Healey: Of course the treaty refers only to ground-launched cruise and Pershing missiles. However, the question of circumvention was much discussed in the negotiations. The two sides agreed not to circumvent. No one can deny that to replace land-based cruise missiles with air-based missiles which, because they are carried on aircraft, naturally have a longer range and can reach

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further into the Soviet Union than land-based missiles, is circumvention of the most dangerous kind. I am sure that the Foreign Secretary will agree with that. I only hope that he keeps tabs on what the Prime Minister and the Defence Secretary are doing at the same time.
I was disappointed that more progress was not made on the strategic arms talks in Moscow. There is no doubt that greater progress was not made primarily because the American negotiators had not cleared their own position. There is still great disagreement inside Washington as to whether the new agreement should cover mobile missiles. The Americans have already announced that they are beginning a programme to deploy their own mobile missiles. There is also great disagreement on how to deal with cruise missiles.
I noticed that Mr. Nitze, the supervising guru of the American team, who has immense experience dating back to the middle of the last world war, is reported by the Herald Tribune as saying that he would like the United States to go for the abolition of all naval nuclear weapons except submarine-based missiles. That would remove sea-based cruise missiles entirely. I fear that unless the Americans move in that direction, they will make as dangerous a mistake as they now admit making when they did not go for a ban on multiple independently targeted re-entry vehicles in the SALT I treaty. Any advantage that the Americans may have momentarily in cruise missiles will certainly be removed in a year or two as it was in the case of MIRVS. The Russians could carry more MIRVS in a single missile because their missiles were more powerful.
In the same way, sea-based cruise missiles are much more a threat to the United States than to the Soviet Union because half the population of the United States lives on the coasts of the Pacific or Atlantic oceans. I hope that the British Government are trying to play a role in this area. I hope that they are not being inhibited by the extraordinary view of the Prime Minister referred to by my right hon. Friend the Member for Gorton, that it would be a great mistake to press on with strategic arms limitations until we have a ban on chemical weapons and an agreement on conventional forces in Europe.
I now want to consider Europe and conventional weapons. The irony of the INF talks and START is that neither side will derive very much economic benefit by eliminating intermediate nuclear forces or by removing half the strategic forces. It may cost more to get rid of the weapons than it costs to maintain them. The only way to save money is by stopping modernisation and cutting the size of forces. Modernisation can only be stopped if we go—as the right hon. Member for Old Bexley and Sidcup did when he was in power—for a comprehensive test ban treaty. There is no technical reason why that should not be achieved. There would have to be a ban also on the testing of new delivery vehicles. With the new technology that is available, verification would be easy. Every single test launch carried out either by the United States or by the Soviet Union is monitored by the other.
The key, and the most important issue for us in Britain, is conventional arms cuts in Europe. I was deeply disappointed that the Soviet proposal at the recent talks, which has been repeated several times since by General Chervov for example, was dismissed without comment by the United States. The Soviet proposals seemed highly sensible. They suggested that the Warsaw pact and NATO should exchange information about the number of troops
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and weapons they have and where they are deployed, and that those figures should be verified. They proposed that either side then found to enjoy superiority in one particular area—as the Russians admit that they have in tanks—should get rid of it. The West would have to give up its superiority in attack aircraft. One would then get down to cutting the equal forces on both sides and moving towards what I regard as being the most important single element in the Soviet proposal, which is restructuring the forces and changing the strategy towards a defence rather than an attack priority. I understand that Mr. Carlucci and General Yasov, the new Soviet Defence Minister, started discussions on that aspect when they met in Geneva recently.
In the course of all that, one must of course get rid of dual capability weapons. If the West insists on retaining a lot of artillery and aircraft, which are useful for conventional war, on the ground that they can also carry nuclear weapons, one will get into a ridiculous tangle. The sensible move—as the German Government are arguing—is to get rid of those weapons entirely, so that they carry neither conventional nor nuclear armaments. I am very sorry that the British Government seem to he supporting the American Government in opposing that particular element in a deal.
Mr. David Howell: Does the right hon. Gentleman have any evidence from his considerable knowledge of Russian strategy of any sign of a Soviet move towards defensive rather than offensive deployment of their superior Warsaw pact forces? Is there any sign either that they are modifying their future procurement, to support a defensive rather than an offensive deployment of forces in eastern Europe?
Mr. Healey: There is very little sign of that at the moment, and what there is is ambiguous. General Aktomeyer is the extremely capable new Soviet chief of staff, whose hobby is modern American novels, right up to Tom Pynchon, who is far beyond any novelist whose work you may have read. I do not mean you, Mr. Deputy Speaker, but the right hon. Gentleman who just intervened. General Aktomeyer has said that they are beginning to restructure their forces and procurement. I myself know, as a former Defence Secretary, that it takes a hell of a long time to get that done, and working out the detail is very difficult. One must work it out to some extent in conjunction with the other side. That is what the Russians have offered and began discussing bilaterally with the Americans when Yasov and Carlucci met.
The West is set on a course of unilateral conventional disarmament in western Europe. The British Government have already committed themselves to cutting our forces as a whole by 5 per cent. over the next three years unilaterally, without getting anything in return from the Russians, and without consulting any of our allies. Germany will find that there will be a big cut in her conventional forces in the coming years, because somehow the sex drive of young Germans collapsed 20 years ago and the number of young men in the Federal Republic of Germany who are of military age is now set on course to dwindle over the next 10 years or so. That may have been due to the sudden appearance in Germany of rather ugly women, but whatever the reason, the birth rate fell and the number of young Germans of military age fell with it.
I recently spent a month in the United States and no one I met believed that the next American Administration

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—be it Republican or Democrat—will fail to cut military spending. It may well cut its forces in western Europe, whether or not we like it. We have an urgent interest in getting on with the process of making the unilateral cuts, to which the Prime Minister, the American President and Chancellor Kohl are all committed, bilateral. In view of some arguments which appear to be taking place far away from my own personal knowledge these days, I would have thought that some Members of the Conservative party agree that it is better to have bilateral disarmament rather than unilateral disarmament, to which the Government are currently committed, at least so far as Britain's forces are concerned.
I conclude on a point to which we must give far more attention than we have in the past. One of the threats to reforming the Soviet Union, and to the Soviet system, is the growing unwillingness of the peoples of eastern Europe and of many of the republics of the Soviet Union—the Baltic states, Georgia and central Asia—to remain subject to the kind of centralised Communist control through Moscow that most of those countries have suffered since 1945. I believe that we shall see explosions, which worries the Russians very much. Recently there was one in Armenia, and there is always the possibility of another in Poland. At present, there is the extraordinary phenomenon that the most likely war in Europe will be between Hungary and Romania over Transylvania—which tension would, in any other circumstances, have certainly have produced a war.
It is important that the West makes it clear that we want political change in those countries, although we do not seek to dictate its nature, and that we have no intention of trying to take any military advantage of such changes that do take place.
Recently, I have been re-examining, as no doubt the right hon. Gentleman has, the events of 1956. Our ambassador in Moscow at that time, Sir William Hayter, was convinced that the Russians wanted to do a deal with the people who had taken power in Budapest and with Mr. Nagy. They withdrew their troops, but the removal of those Soviet troops occurred on 30 October 1956, which was the same day on which the British and French Prime Ministers issued their ultimatum to Colonel Nasser. It remains an open question, and one that certainly torments Sir William, who wrote about the matter in his book, whether the Russians would have sent back their troops if they had not been given cover by the Suez adventure. It is possible that they would have done so in any case, the moment that Mr. Nagy said he wanted to take Budapest out of the Warsaw pact.
We ought to start moving towards a Western position in which we make it clear that we shall not take military advantage of desirable political changes inside the Soviet bloc. If we follow the line that the Russians propose, of having defensive-oriented strategies, it will be very difficult for us to do so.
Dr. Alan Glyn: I was in Budapest at the time, and while the treaty was being signed between the Russians and the Hungarians, Russian troops were advancing—we saw them.
Mr. Healey: With respect, that was on 31 October and at the beginning of November. I remember asking Sir
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Anthony Eden, as he then was, whether he had exchanged congratulations with Marshall Rokossovsky because Budapest fell exactly the same day as Suez. That was a shame on the British people, the scars of which I hope are still worn not too lightly on the Conservative Benches.
What we are seeing in the Soviet Union, if it succeeds, and it is too early to be sure, may prove to be not just a watershed in the cold war, or, as has been said, the beginning of another cycle—we saw one under Malenkov and Krushchev—but a turning point in world history. We must face the fact that nuclear weapons and modern technologies are making war far too risky an enterprise for developed countries, and it is far too risky for the developed countries to allow the undeveloped countries to kill one another's peoples at will, as they are doing at the moment.
If Mr. Gorbachev succeeds, we shall be embarking on a new phase in the history of the human race. We are trying to develop a new international framework for stability between peoples which will have to involve not just the super-powers and their allies but all the other nuclear powers—Israel, India, China—all the other potential nuclear powers, and, ultimately, all countries in the world.
That is an enterprise that may take centuries to complete, but to my mind it is the most worthwhile enterprise that humanity has ever faced and I only hope that the British Government play a constructive role in it.
7.1 pm
Mr. Michael Marshall: As has been said, it is rare for us to have an opportunity to debate foreign affairs. I hope that the House will understand if today I seek to say a word or two about the role of the British group of the Inter-Parliamentary Union.
I am delighted to follow the right hon. Member for Leeds, East (Mr. Healey), because I should like to take up one or two themes on which he touched and, indeed, to refer to some of the parts that he has played in our affairs.
It goes without saying that I do not need to rehearse the value of parliamentary diplomacy. I recognise on both sides of the House many who have played an active part in that work and will continue to do so. Therefore, in the spirit of today's debate, I want to concentrate on some practical examples of our work which highlight and illustrate the general thrust of the debate so far.
Let me deal, first, with our relationship with the Soviet Union and other Communist countries. The right hon. Gentleman was right to emphasise that we cannot reflect on the major changes in the Soviet Union without considering their impact on the satellite countries.
It is fair to argue that it was after the visit in 1984 of Mr. Gorbachev—then leader of the Russian parliamentary delegation, before he became Head of State—that we began to see the glasnost-perestroika summitry dialogue beginning its logical progression.
It is also fair to suggest that the return visit to Russia, through the Inter-Parliamentary Union, of the delegation led by Lord Whitelaw and the right hon. Member for Leeds, East was an opportunity to carry forward an understanding with the Soviet Union and, in particular, with Mr. Gorbachev, which has been of great significance.
I know that the right hon. Gentleman has said in a light-hearted moment that he saw himself as a gentleman's gentleman to Lord Whitelaw, but the fact of the matter is

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that it was a significant delegation. The substantive talks covered matters of great importance. We have in our IPU room something in which we take pride—a letter from my right hon. Friend the Prime Minister reflecting on the value of that Gorbachev link. The right hon. Member for Leeds, East has taken other opportunities, fairly, to say that he sees that IPU activity in relation to the Soviet Union as being of wider significance.
The process continues. We shall be sending a delegation to the Soviet Union in due course and we look forward to the delegation that is due to arrive here in November this year. Much interest will turn on the leadership of that delegation. I do not want to say too much about that today, but it is clear that, after the Gorbachev interest, consideration has been given to bringing over others with a new-found interest in Britain.
On a more practical day-to-day basis, one of the key discussions at the IPU biannual conference concerns drug trafficking and terrorism—areas where parliamentarians can seek opportunities to find common ground. It will not have escaped the notice of the House that conversations in Britain, in which Members of both Houses of Parliament were involved, with the Russian ambassador have, within the last few weeks, been reflected in some successes in tackling drug trafficking in which the Soviet Union's co-operation played an important part.
Let me deal now with some of the satellite countries of eastern Europe. This afternoon the Bulgarian Deputy Foreign Minister was in the IPU room leading a parliamentary delegation. Bulgaria is one of over 40 countries represented every year which come to see the IPU. The conversation today pointed ahead to our visit to Bulgaria in the autumn for the next IPU conference and the opportunity to consider the Bulgarian-British relationship. It was clear from our discussions today and from those of my hon. and learned Friend the Member for Colchester, North (Sir A. Buck), who was recently in Sofia with a Labour Member for disarmament talks, that the Bulgarians are looking to reappraise their relationship with Britain. That is an obvious example of the interest and differing approaches of a number of east European countries in the light of events in the Soviet Union.
Sir Antony Buck: As my hon. Friend has been kind enough to mention Bulgaria, may I say that I agree with every word that he has said so far? I suspect that I shall go on to agree with everything he has to say. I and a Labour Member made a particularly valuable visit to Bulgaria. It is far better to have jaw-jaw than war-war. It is important to form contacts and friendships across political barriers, and that is largely made possible by the work of organisations such as the IPU, which my hon. Friend distinguishes.
Mr. Marshall: I am grateful to my hon. and learned Friend for that intervention. I pay tribute to the work that he has done, together with the hon. Member for Walsall, South (Mr. George), who also played a notable part.
By contrast with Bulgaria, recent contact with Romania emphasises the difficulties that must still be overcome. It is undoubtedly accepted by Foreign Office Ministers and hon. Members on both sides that there is a cool relationship with Romania, partly stemming from cases of personal tragedy affecting those who seek to inter-marry. There are several other issues. I shall not labour the point, but simply go on to say that next year we
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shall be engaged in the biennial process of meeting to discuss security and disarmament within Europe. That gathering will be in Romania, and I hope that we shall take the opportunity to explore what makes so sharp a difference between the relationships that we enjoy with that country and some others in eastern Europe.
By contrast, I come to Hungary, where we shall be going next year for the spring conference of the IPU. It is interesting that the Hungarians have told us consistently over several conferences that they have been in the business of glasnost and perestroika for years. They would argue—I think with some force—that they maintained a dialogue with the West at a time when the relationship between the United States and the Soviet Union was going through one of its most difficult periods.
We look forward to finding opportunities to co-operate with our Hungarian friends in sharing what will essentially be a year-long celebration of the centenary of the Inter-Parliamentary Union next year. They will have their conference in the spring. We, as co-founders with France, will have the main conference in the autumn. But in finding ways in which we can share the load—indeed, the opportunity—I believe that we can help to strengthen that relationship, too.
Mr. Donald Anderson: Before the hon. Gentleman leaves this general theme of parliamentary diplomacy, will he recall that the IPU, like some beers, can reach places that the Government cannot; that the IPU has played a very significant part in, for example, the re-establishment of diplomatic relations with Guatemala; and that it is able to meet our Argentine parliamentary colleagues in a way that is denied to the Government?
Mr. Marshall: The hon. Gentleman, and perhaps the House, will be delighted to learn that he has just removed paragraphs five and six from my speech. I entirely accept what he says.
Turning briefly to the non-aligned countries, our relationships there are well illustrated by our recent talks with the Tunisians. When they came to this country, their delegation was led by a former Prime Minister. Recent studies show that about 30 parliamentarians active in the IPU internationally are Speakers or former Heads of State. That is a very clear indication of how seriously other countries are taking the IPU. That is why I feel entitled today to remind the House of some of the progress that is being made within our own Parliament.
The visit of the Tunisian delegation led to a first demarche in which we combined to press for acceleration of the process towards a middle east peace conference. That matter is receiving study by a committee set up within the IPU internationally. We must pick up that theme again when we go to Sofia in the autumn.
The hon. Member for Swansea, East (Mr. Anderson) is a good example of an hon. Member who, despite his many responsibilities on the Opposition Front Bench, is helping us in our work, as he showed in his comments about the Argentines. It is true that at many conferences in recent years we have been able to maintain the process of continuity of understanding and looking at practical issues with Argentine parliamentarians—a process which at present is effectively denied to Her Majesty's Government; and, as the hon. Gentleman also implied, when we met in Guatemala last spring, it was after 23 years in which there were no diplomatic relations between Guatemala and the

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United Kingdom. During that time the only effective link had been through parliamentarian contacts within the IPU. Foreign Office Ministers have been good enough to make the point that this process was undoubtedly instrumental in bringing back diplomatic relations between our two countries.
The last category of countries to which I wish to refer can be broadly described as our allies within the IPU. Working within the European Community and with other countries, such as the United States, Canada and Australia, there are certain like-minded Parliaments which over the years, have come together in what, perhaps thanks to a British invention, is known as the 12-plus. I say a British invention because, in a splendidly illogical way the 12-plus involves relationships with some 23 countries. It has, like many other institutions, grown over the years.
Within that grouping we can look back, for example, to the recent talks with a Spanish delegation, at which we immediately focused on the key and difficult issue of Gibraltar. Again, we found that we were able to clear a lot of the basic misunderstandings. I must commend the way in which, on this as on many other occasions, it has been possible for parliamentarians on both sides of both our Houses, without in any way checking freedom of expression, to achieve a line that has a certain unanimity in discussing problems with other countries.
We shall have a delegation from Italy coming here in two weeks' time. I am reminded that when I went to my first IPU conference in Rome it was to speak against a motion condemning Britain for what was described as the invasion of the Malvinas on 5 May 1982—a fairly short, sharp, crash course on international relations within the IPU. That reminds me now that Italy, too, has a key role to play in relationships with Latin America, particularly Argentina, for reasons which are well known to the House.
I come finally to our bilateral discussions with Ireland. With Ireland the relationship is one that I would regard as family in one sense, but of the greatest significance in the wider international context. We have, not only in our conferences but in other informal and to some extent formal talks in recent years, kept up a high rate of exchange visits. We have long recognised that these contacts are, perhaps by their very nature, not enough to tackle some of the deep-seated problems, particularly the problems of perception and understanding and, above all, the need to widen the scope by bringing parties of all persuasions in our two countries into the dialogue.
It would be premature to say much more about the process, but I want to take the opportunity—and I hope that they will not be embarrassed—to pay a particular tribute to my hon. Friend the Member for Leominster (Mr. Temple-Morris), who led the delegation to Dublin with such distinction, the hon. Member for Middlesbrough (Mr. Bell), to whom I had a chance to talk earlier today and who I know is particularly involved and concerned, and to my hon. Friend the Member for Berkshire, East (Mr. MacKay). They are now working actively together as a working party which liaises with three Irish parliamentarians in an attempt to find a more permanent structure upon which the dialogue can be sustained. I very much welcome that development and, with regard to the practical problems, questions of finance,
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and so on, I want to assure them that we shall do all that we can to help to sustain the process until, in due time, it has a life of its own.
As I have emphasised, in all the work of the IPU we rely on Members of both Houses and of all parties. We also rely on Mr. Speaker and the Lord Chancellor, our honorary Presidents, and on you, Mr. Deputy Speaker. We are all involved in a process by which we seek not only to put our point of view, but to encourage parliamentarians throughout the world to reflect on the way in which our system works. We believe that we still have things within our system which, although they may not be ideally suited to every system, others admire.
As we move towards our centenary next year we shall continue to draw, as we have in the past, on the kind of willingness and dedication that many Members of this House and of the other place are prepared to put into something which they see as worth while. We are all used to the kind of loose criticism that it is easy to throw at this place and the partial view of life that is reflected in the noise at Question Time, and during Prime Minister's Question Time twice a week. In the solid, continuing endeavours of institutions such as the British group of the Inter-Parliamentary Union I believe there is a genuine example of parliamentarians at work trying to find common cause and, above all, doing what the IPU was established to do a century ago—seeking to resolve international conflict.
7.17 pm
Mr. Ernie Ross: I will not attempt to cover any area other than the middle east, in particular the Arab-Israeli problem, in my contribution to tonight's debate. I shall certainly try to keep within Mr. Speaker's requested limit of 10 minutes for Back Benchers so that other hon. Members may have a chance to speak.
We are rather fortunate today in that we are speaking about an area of the middle east where for the first time, certainly in the nine years that I have been a Member of the House, there is agreement on both sides of the House on how we should proceed. I suggest to the Government that the last remaining stumbling block over which neither they nor the United States can jump but which clearly has to be surmounted is the question of the international peace conference and the settlement of the Arab-Israeli conflict.
On 14 June, Faisel Awiedah, the representative of the Palestine Liberation Organisation in Britain, spoke to the Back-Bench foreign affairs committee of the parliamentary Labour party. On 29 June, Abba Eban, the chairman of the Israeli Foreign Affairs Committee, likewise addressed that committee. What was remarkable was the clear unanimity of those two personalities in their determination to try not to look back, but to see how they could point the way forward. There was unanimity of purpose, although they were talking on different nights in the same place. There was a determination not to cast yet more stones but to look for ways of resolving the problem.
What made those statements remarkable was that some people said that it was the first time that they had heard certain things said by either speaker. It is also remarkable that, although those same representations and organisations have been making those same comments, neither we in the House nor others in Europe and the United States

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have been listening—or, more important, have insisted that they make those statements in the same room, at the same conference table and at the same time.
I do not wish to refer to last night's comments as though last night was somehow an aberration. Let me simply quote one or two comments to show that this is nothing new for either of those two organisations. In an article published in the Jerusalem Post, Abba Eban said:
"There exist none of the minimal affinities that would make it in any degree normal for 1·5 million Palestinians to live under Israeli rule. A principle that was fervently applauded when it is applied to 600,000 Jews cannot become obsolete when it is applied to 1,500,000 Palestinian Arabs, unless we take refuge with Kahane and Gush and Emunim in a doctrine of racist superiority."
In an article published in the Jewish Frontier in November—December 1987, he said:
"The Palestinians in the West Bank and Gaza cannot vote or be elected to anything, have no juridical control over the government that rules their lives, have no appeal against the judgments of military courts, are not free to leave their land with assurance of the right to return, are not immune, as are their Jewish neighbours, from such penalties as expulsion or the blowing up of homes or administrative detention, have no flag to revere, and do not possess the same economic and social conditions as their immediate Jewish neighbors."
In his book "If Only My People", the Chief Rabbi has written:
"Neither religious discipline nor national sovereignty can be permanently imposed by force on hostile majorities. Such force must in time disaffect the ruled and brutalise the rulers."
He argues for a return to Jewish morals and standards, saying:
"Such a return to Jewish values would give Israel democratic strength … external respectability as a model society; and an eventual accommodation with the Arabs through moral sensitivity for Palestinian sufferings and aspirations compatible with Israel security."
There have been comments from the PLO apart from what Faisal Awiedah said on 14 June. A recent statement by Bassam Abu Sherif, adviser to PLO chairman Yasser Arafat, has raised expectations that something has been said by the PLO that had not been said before:
"The means by which the Israelis want to achieve lasting peace and security is direct talks, with no attempt by any outside party to impose or veto a settlement. The Palestinians agree. We see no way for any dispute to be settled without direct talks between the parties to that dispute".
The Palestinians feel that it is unacceptable to one or both of the belligerents that a settlement be imposed by an outside power. Such a settlement would not stand the test of time. The key to a Palestinian-Israeli settlement, they say, lies in talks between Palestinians and Israelis.
The PLO, however, accepts UN resolutions 242 and 338. What prevents the PLO from accepting the resolutions unconditionally is not what is in them, but what is not in them:
"neither resolution says anything about the national rights of the Palestinian people, including their democratic right to self-expression and their national right to self-determination. For that reason and that reason alone, we have repeatedly said that we accept Resolutions 242 and 338 in the context of the other UN resolutions which do recognise the national rights of the Palestinian people."
There has been considerable press speculation about the statement. Is it a statement of fact? Can it backed up? Will it be changed? The way in which to determine the accuracy or otherwise of such a statement is, I suggest, through only one appropriate channel. It can be achieved if Mr. Shultz adds Tunis to his itinerary and, when he is there, asks Yasser Arafat to confirm or deny that such statements reflect PLO policy.
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What is certain is that, no matter what is said by the media, the Government or the United States, the Palestinians will act not through more articles in the press but through direct dialogue. The Opposition have recommended that to the American and British Governments. If we are to overcome the years of mistrust that have grown up between the Palestinians and the Israelis, we must find some way of bringing the two together, and everyone is now agreed that that should be done through an international conference.
That is not something new. Since the second world war there have been 40 such conferences—for example, the tripartite conference after the war, the conference on Trieste, the conference that led to the Austrian state treaty, the Geneva conference that promoted peace in North Africa, the Paris conference that brought peace in Vietnam and, more recently, the conference on peace and security in Helsinki, which sought to establish a new international order.
It will be necessary for the super-powers to be involved in such a conference. We must involve states from outside the region. First, all the potential parties to an agreement rely to some extent on financial or military support from outside the immediate region. Secondly, either of the super-powers could, if it wished, use its influence to frustrate agreement by bolstering its 'clients' in an intransigent stance. Thirdly, the super-powers and other members of the United Nations could provide security guarantees as part of a peace settlement as well as economic inducements.
More important, as one of the key protagonists—the Palestinian people—does not enjoy the attributes of state power, the organisations that represent it being scattered throughout the world, it cannot rely on the disinterested support of the Arab states neighbouring Israel. The involvement of the super-powers would give them some confidence that such a settlement could provide lasting peace in the area. Speaking to the parliamentary Labour party last night, Abba Eban suggested the Benelux experience as an example of how the peoples could live together. That, however, could come only after an international conference.
I ask the Minister to take that last vital step and to talk to the Palestinian people. If I must give one final reason, it is the current events in the West Bank and Gaza. Since December 1987, more than 220 Palestinians, whose ages range from four or five to 70, have been harassed, detained, beaten and shot dead by the Israeli defence forces. As Abba Eban freely admitted last night, no time in history provides an example of a people who—once their consciousness has been awakened as it has been in Gaza and the West Bank—have been able to be beaten into submission, or have given up their aspirations and determination to achieve the rights for which they have struggled.
On behalf of those people in Gaza and the West Bank, and those in Israel, I ask the Government to encourage Europe and the United States to take that one last step. As early as March this year, during Foreign Affairs Questions, I told the Secretary of State that it was no good for Mr. Shultz to go to the West Bank, Gaza, Israel, Jordan and Egypt unless he spoke to the Palestinians. Unless and until this Government and the interlocutor for the Israeli people speak to the Palestinians, that peace process cannot be started. I hope that when the Minister

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replies she will say that the British Government will talk to the Palestinians and will take a meaningful step towards peace in the middle east.
7.30 pm
Mr. David Howell: The House listened with great interest to the right hon. Member for Leeds, East (Mr. Healey), the former Opposition spokesman on foreign affairs, and possibly with more interest than to the right hon. Member for Manchester, Gorton (Mr. Kaufman), the present Opposition spokesman on foreign affairs, who in his 50-minute polemic seemed to have difficulty in achieving any balance in his handling of foreign affairs.
I hope that the right hon. Member for Leeds, East is wrong in his analogy of perestroika with the Reformation. Although the Reformation may have underpinned the liberties and independence of this island, it unleashed on the continent of Europe a series of the most ferocious and bloody wars for years. If I have a worry about the right hon. Gentleman's analysis of Soviet affairs, it is that he may be giving too little weight to the centrifugal tendencies that could develop in the Soviet empire as it attempts to rethink its position, and to the enormous consequences, dangers and opportunities that flow from that. It was a fascinating speech, and we were glad to hear it.
It was the ubiquitous Dr. Kissinger who observed the other day that there never was a time when economics was having a more decisive and weighty influence on foreign policy than today. That is a fair point. Since the House last debated foreign affairs we have seen definite signs that the United States faces economic difficulties. It has huge deficits and the dollar is weaker and has been removed from the centre of the world trading system as the key currency, which it has been on and off for the past 40 years. That is beginning to drive and modify its entire foreign policy stance. In a sense that is inevitable. We are moving from the post-war order and it is now perfectly clear that, no matter who gets into the White House, American foreign policy will be largely driven by the economic considerations that that huge nation faces in adjusting its world policy to its economic performance and circumstances.
Meanwhile, we have seen the ever-continuing rise of Japan. Sometimes we forget that Japan's gross national product is greater than that of the Soviet Union and that in terms of income per head on the present exchange rates the Japanese are the richest in the world. Japan now finances the third biggest defence budget after America and the Soviet Union. That is a wholly new factor which cannot be ignored in assessing the new landscape of international relations.
Black Monday, to which my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) referred, is further confirmation of that. It was not merely an economic or financiers' phenomenon. It was as though a sheet of lightning on a dark night revealed in glaring light the new facts of international relations—that the Americans were no longer strong enough to support their currency and decided to let it go, and the Japanese emerged as the world's major banker, investor and lender. They are the decisive influence on the economic affairs of the entire planet. That is the second way in which the
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landscape has changed radically. To re-establish our nation's foreign policy priorities without understanding that would lead to difficulties.
In talking about perestroika and the reforming and restructuring of the Soviet Union, the right hon. Member for Leeds, East may have underestimated the fragmenting tendencies that that could create and the difficulties in the Soviet empire. That will not necessarily reduce tension because, as we know, a wounded bear can be a dangerous animal. There are many danger points ahead, even if the right hon. Gentleman is right to be optimistic, as I think he is, that the underlying technological and economic forces make it impossible for the Soviet Union to go back to its old highly centralised, secretive and insulated state.
I do not agree with the right hon. Gentleman in his too easy assumptions about what will happen to Soviet defence policy. There was a shade of naivety in his views about the Soviet approach to conventional armaments. If it is intent on conventional armament negotiations and on moving away from its colossal superiority in that regard, let us see some signs that the message of perestroika has reached the Soviet general staff and the military establishment. There appears to be little sign of that, not only in present deployment but in the pattern of procurement and weapons orders that are now being formulated and which will be delivered as weapons in up to four years' time. We have a long wait before we can be sure that the vigilance, on which my right hon. and learned Friend rightly insisted, can be relaxed in the slightest way.
With the relative weakening of the United States and its removal from overall unchallenged predominance in the West, with the colossal economic power of Japan which is trying to relate that to a global political policy, and with the unfolding of the Russian scene in a fragmented and explosive way, we have seen a re-drawing of the map of the post-war world. The settlement of Yalta has now begun to be transformed. We are seeing a pattern in which there emerge new regional interests which do not necessarily match any more with that simple and, to some people, comfortable world of two super-powers, the bi-polar line-up, the Western and Eastern camps and the ideological divide. That is now being replaced by a whole set of new, complicated and sometimes dangerous regional patterns which require a rather different approach to the one which has been adopted for the post-war, Yalta-determined world.
There can be no better illustration of the new complexities and cross-currents than the issue which my right hon. and learned Friend raised—the Iran-Iraq conflict in the Gulf. He was kind enough to refer to the second report of the Foreign Affairs Select Committee on that conflict which has appeared today to coincide with this debate. I am grateful to him for his remarks about it and to my right hon. and hon. Friends on the Committee for their enormous amount of work on it. It provides a fascinating illumination of the point that things are not as they were and the world is no longer automatically to be analysed simply in terms of a Washington-Moscow axis and two super-powers.
The first message that we tried to put across in the report is perhaps rather obvious, but it needs restating to some people. It is that Iran and Iraq are not, in Chamberlain's chilling words,
"faraway countries of which we know nothing".
but countries whose mutual warfare—their horrific engagement in one of the grimmest, most ghastly wars,

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with a killing total that exceeds almost anything in any other continuing world crisis and begins to put it in the grim league of world wars—interests, future and influence on their neighbours are of extreme, intimate and immediate interest to this island and our immediate allies.
We urge in our report that this is a matter not of any one country trying to solve the problem—it cannot—but of international collective action. We say that it is not necessarily a pattern which will be resolved by the United States and the Soviet Union establishing some deal or arrangement without the support of other countries. On the contrary, the message which came over to our Committee again and again, particularly when we travelled to Washington, was that it is essential for the European allies to mobilise support in the Gulf operation and that, without it, it would be very difficult for the United States to move on from the world policeman role which it told us at the National Security Council it did not really want to play.
We are a little censorious in the report that, if that is the United States' position, it was a pity that when it decided to enlarge the United States navy's role and to extend protection to all neutral shipping, it did not consult the British Government formally. It wants the support of western Europe for the Gulf operation and it values enormously the support of the Royal Navy. It is glad of the lead role that the Royal Navy is taking in co-ordinating other western European minesweeping operations. In stumbling or moving forward, however, the United States somehow failed to make the obvious counterpart step of careful consultation with those allies before changing the terms of engagement of its fleet.
The Select Committee report also mentions the fact that Japan has a key role in all of this. We are not used to thinking of this huge power, which has the third biggest defence budget in the world after the Soviet Union and United States, having a direct role. There are problems about Japan having a military role in the Gulf area, and I do not think that anybody outside or within Japan is suggesting that that should be the case. Nevertheless, Japan draws a great deal of its oil from the Gulf. It is a centrally interested party in stability in the Gulf and it is vital that it should play a substantial—possibly a more substantial—part.
Mr. Madden: Did the Select Committee consider the difficulty presented to the British Government and their credibility when trying to bring about a resolution of the Iran-Iraq war by the fact that we supply arms to both Iran and Iraq, directly or indirectly?
Mr. Howell: I do not know what detailed evidence the hon. Gentleman has for saying that. It is the British Government's declared policy not to supply lethal weapons to the belligerent countries, and I understand that they do not do so. If the hon. Gentleman has detailed evidence, no doubt he will have an opportunity to present it later in the debate.
Mr. Corbyn: Will the right hon. Gentleman give way?
Mr. Howell: I should like to continue as I am conscious of taking too much time and I am anxious to share with the House the conclusions of our Select Committee on this issue.
The Committee stresses that the British initiative in the United Nations has by no means been a wasted effort. We
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think that it has been immensely valuable. There is a point of view which exists in my party—I have even shared in the past—that the United Nations had reduced itself to an absurd reflection of the world's alignments and ideologies—the aligned or non-aligned North and South, East and West—but was achieving nothing constructive. But now the process of the new regional grouping is being reflected in the United Nations and the opportunities are growing for it to play a more effective part than it has during the past few years.
That is well illustrated in the case of the Gulf. All five Security Council members—the Soviet Union, China, America, Britain and France—have agreed a mandatory resolution. That is a remarkable sight and it shows that something is afoot. We would be unwise to go on writing off the United Nations, as many people do both here and in America, as the old, useless and "fixed" talking shop that it was.
The report emphasises the need to ensure the right of shipping to navigate freely on sea lanes,. Shipping should be protected, and we welcome the efforts of the Americans, supported by our own Armilla patrol, to ensure that. If the war escalates, it is difficult to see how neutral shipping, let alone our own flagged shipping, is to be protected. So far, however, the Armilla patrol seems to be highly successful in the limited area it patrols.
Our report identifies the acute and massive British interests in trade, commerce and security, which rely on our keeping and developing close relations with the nations of that stormy region. The Government are apparently considering renewed relations with Iran. As my right hon. and learned Friend said, the report underwrites, underpins and confirms what I understand to be the Government's view—that in expanding again our diplomatic relations with Iran, which effectively means putting an ambassador back into Tehran, there should be no question of that process being linked with any deals on hostages.
Hostage release should rely on pressure for humanitarian, legal and justice reasons to ensure that everything be done by those who can do something to get Hezbollah, or whoever holds our hostages, to release them. The opening of diplomatic relations is a quite different issue. It should proceed cautiously, not in a hurry, and not until there have been certain guarantees that our diplomats' safety will be secure and that they will be treated properly under the Vienna convention.
We have also to consider the release of British nationals held without trial in Tehran. There is also the matter of a few bills to be paid and compensation to be settled both ways. They involve considerable sums, but they must be settled before we have a diplomatically staffed embassy in Tehran again. That is the direction in which the Select Committee points and it is the one in which we should go cautiously.
I hope that that illustration of the broader point about the changed international landscape has interested the House. Considerations are no longer totally dominated by the two super-powers. I hope that nothing I have said weakens what I understand to be the very good bedrock of this island's foreign policy—that we must have a sound economy, which gives us power and influence. I am not the first to say that. We can all remember Ernie Bevin asking for another 10 million tons of coal so that he could have a foreign policy. We have today a modern expression of

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the same doctrine. Given the strength and dynamism of this economy, we are able to pursue a constructive foreign policy role.
Nothing detracts from the responsibility of every country to go for sound national policies and to develop independent views. That is all the more important in this less simple, less bipolar and more complex world.
My right hon. Friend the Member for Old Bexley and Sidcup made some interesting comments about the European Community. I sometimes feel that the message he put over needs to be shouted a little louder in the House. We hear a good deal about the need to keep our independence. That is vital, but to keep it we must appreciate the interdependence of policy. We must appreciate the role that we must now play in the new organisation and the new groupings which have emerged and are beginning to replace the super-power pattern.
Our policy is making progress in the European Community, but it is not as strong as I should like it to be. We are moving towards a single market, but we have to understand the political underpinnings of that drive and not just dismiss it as a trade association with common rules, which is how I heard one Minister describe it.
We have to play a decisive part in the group of seven Finance Ministers. G7 will become G3 in due course. I do not mean Japan, Germany and America but Japan, Europe and America. Those will be the three decisive currency blocs. We must decide our relationship with the other European continental currencies soon. I am in favour of full membership of the exchange rate mechanism.
In the unfolding world of armaments negotiations, which will be very tricky for western Europe and unsettling to the western European NATO allies, we must fight for, and build with great vigour, the European pillar of cohesive defence in the NATO Alliance. That should be carried on with rather more gusto.
There is much talk in the House and elsewhere of draining influence, declining sovereignty and increasing difficulties in making our voice heard in the world. That talk is becoming old-fashioned and defeatist. The reality is completely different. Britain has not had so much influence in almost all the councils of the world and all the emerging regional groupings for the past 40 years. That influence is available for Britain to use wisely. We have to learn how to deploy that influence and how to exploit our new advantages in the new landscape.
My right hon. and learned Friend the Foreign Secretary is a good and wise guide for this new map and this new world. But we need great understanding, great caution and great wisdom in reacting to what has happened on this planet during the past few years.
7.50 pm
Mr. Alex Carlile: It was encouraging to hear the Foreign Secretary speaking of the frequent contact that the British Government now have with the Government of the Soviet Union and of the many meetings that he has held with the Soviet Foreign Minister. We are all clutching optimistically at glasnost in the hope that it will turn out to be a pillar and not merely a straw.
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I hope that after glasnost in the Soviet Union we shall see the same process developing outwards into the world at large.
I have a particular interest in the Soviet satellite countries. In the past two or three years, through the good offices of the Great Britain-East Europe centre, I have had the privilege of leading two small delegations of British lawyers at meetings with Hungarian lawyers—one in Budapest, and one in the United Kingdom. At those meetings, and at others, I found that we had many common interests. The Hungarians are a very remarkable people. They realised that glasnost existed long before the word was invented. Through their determination, they were able to achieve some significant economic changes, which have given them a much closer relationship with the West. They find it rather offensive to be described as a country of the East and prefer to be regarded as part of central Europe.
I regard nearby Poland with some despair. Unfortunately, the same processes have a long way to go there. Whatever version, if any, of glasnost has reached Poland has been deep frozen and heavily insulated. It has yet to be taken out of the freezer cabinet. I hope that when the Prime Minister goes to Poland in a few months' time she will take with her a copy of Mr. Gorbachev's speech this week, and ensure that it is read by General Jaruzelski. The process that Mr. Gorbachev has begun in the Soviet Union has not seeped through in spirit to Poland.
There are, unfortunately, still political prisoners in Poland who have been arrested without being charged and, because they have not been charged, they are not put on trial. I have evidence of what has happened to one family. After the mother was arrested for her political beliefs, her children were then harassed. Her eight-year-old daughter was subjected to interrogations after being taken from her school, and she eventually suffered a nervous breakdown.
I have corresponded with the Prime Minister about these issues. She sent me a helpful reply, and I hope and trust that when she goes to Poland, she will make it clear to the Polish Government that, although it is not our role to intervene in the internal affairs of other countries, the development of economic co-operation with other countries depends very much on our perception of how they operate outwith and also within their own institutions.
That is essential both for the process that Mr. Gorbachev has started and for the more direct relationship between the United Kingdom and countries such as Poland, Czechoslovakia, and Bulgaria. We hope that they will become countries that apply the same civilised standards to freedom of thought and speech that we at least aspire to. It is far easier to co-operate economically with a country that has a reasonable degree of plurality than with a country that is authoritarian. Such countries give greater confidence to those who sell their goods there. I share the hope that was expressed earlier that there will be a much freer exchange of technology with the countries of eastern Europe and that we shall be able to set up a genuine market in goods, which has been difficult to establish in the past.
There are, of course, exceptions. One example is the success of Wellcome International Trading Ltd. in Hungary. There are other less happy examples, such as the conduct of ICL in Poland. I hope that the Government will give some attention to that matter.

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I propose to speak only very briefly about South Africa because I know that many other hon. Members wish to speak in the debate, and some of the earlier contributions were on the long side. I do not question for one moment the bona fides of the Foreign Secretary in his wish to see change in South Africa. Unlike some Opposition Members, I accept that the Government find apartheid abhorrent, that the Foreign Secretary wishes to make a genuine attempt to secure the release of Nelson Mandela, and that real efforts are being made to ensure that the Sharpeville Six are not executed.
As a lawyer, I shall highlight one particular point about the Sharpeville Six. They have been convicted of complicity in murder and they are to be hanged for murder, not for affray or for being involved in a riot. They have been convicted of deliberate homicide—the intention to kill or cause serious injury to a specific person. They were convicted under a system of law that shares much with our system of common law. I say without fear of contradiction by any reasonable common lawyer or jurisprudential expert that in any properly applied common law system the Sharpeville Six could never have been convicted of participation in murder. Their conviction was scandalous; their execution would be an outrage. It would bring upon the South African Government greater condemnation even than the continued and unjustifiable detention of Nelson Mandela.
Although I accept the bona fides of the British Government and their intentions in the matter, I believe that the British Government's method of dealing with South Africa has failed. The South African Government do not appear to believe that the subtle negotiations, the occasional conversations and the gentle nudgings of the British Government will help them to make changes. They are stiffening in their resolve because they believe—probably wrongly—that the British Government support the way they are governing South Africa. Early this afternoon the Prime Minister spoke about the economic summit. That summit produced an example of the intransigence of the British Government and their failure to see that their policy on South Africa has failed.
I hope that the British Government will recognise more starkly the barbarity of many aspects of the South African regime. I cite, for example, the introduction of the Orderly Internal Politics Bill. That sort of barbarity will continue unless sanctions that have a meaningful effect on South Africa are introduced. I hope that the Government will be courageous enough to admit that they have tried one approach that has not worked, and that they will now embrace more direct economic action against South Africa, for only that will be the way in which to bring about real change without widespread bloodshed.
8 pm
Mr. Robert Rhodes James: As always, it is a great privilege to follow the hon. and learned Member for Montgomery (Mr. Carlile). Although we do not agree on everything, he will recall that I was one of the founder members of the Anglo-Hungarian round table, so we share an interest in that as well as in South Africa.
I want to focus on one point in what has inevitably been a wide-ranging debate. It relates to Namibia in particular and southern African in general, and it has already been mentioned by my right hon. and learned Friend the Foreign Secretary, my right hon. Friend the Member for
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Old Bexley and Sidcup (Mr. Heath) and other hon. Members. It might seem strange that so much concern should be felt in the House about a vast, faraway country, more than twice the size of France, with a small population, and with which we have little historical connection and few colonial links, but there is something about Namibia and its people that stirs other hon. Members and me.
When I visited Namibia and went to the war zone on the Angolan border with the hon. Member for Swansea, East (Mr. Anderson), what I saw was a deeply shocking and moving experience for me. It was shocking, first, because of the economic situation. As the House knows. I was born and brought up in India, and I have been exposed to poverty. I have seen the ravages of war arid poverty in India and Africa; one does not become cynical but one is perhaps occasionally hardened. Nevertheless, what I saw in Namibia shocked me.
It is not amusing to visit a black hospital in which there are no drugs or even bandages and then to go to a white one that is equipped as well as Addenbrooke's, Cambridge. It is not amusing to see the contrast between white and black education; or to see the South African defence force in operation; or the massive deployment of that defence force, or the suppression of the people. What makes this even sadder is the warmth, kindness and good will of the Namibian people and the realisation that the country has the potential to be economically viable and happy, while maintaining the interests of the South African people.
The hon. Member for Swansea, East and I went to a little village called No Hope town—yet there was hope there. We were welcomed with warmth and encouragement. I give the House the following warning, which I also endeavoured to give to the South African Government and others who are interested in the area. Sarajevo was further away from this country in 1914 than southern Africa is today. Who can say, if a conflagration were to explode there involving the super-powers, that it could be contained?
September will be the 10th anniversary of the passing by the Security Council of resolution 435 on independence for Namibia. That resolution is strongly supported by the Government, the Opposition and, with one or two exceptions, by virtually all hon. Members. Perhaps, in view of the 10 years that have elapsed, certain aspects of resolution 435 will have to be revived; but it is an establishment of principle. It gives the people of Namibia real hope. It also gives the people there who do not believe in violence real hope that constitutional reform and freedom may come about without war. The British role in the contact group is important in itself. There are hopeful signs. There were discussions in London with SWAPO. There were hopeful signs in the Moscow communiqué.
I want briefly to put to the House my thoughts on this matter. Given my views about the President of Austria, it may seem slightly strange to say this, but perhaps the Austrian solution is the answer—the freedom, neutrality and independence of Namibia might be guaranteed by the great powers. That would meet the legitimate concerns of the South African Government and people and give the Namibian people their freedom. We, as one of the guarantors, would have to accept that the new, free Namibia would require aid and assistance, not only with drugs and agriculture, but for many other things. The:

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financial cost would not be very great, but the reward, in terms of the prospects for peace and happiness, would be immense.
I have one political ambition—one day to stand in a free and independent Windhoek.
8.6 pm
Mr. James Lamond: It is tempting, in one of the rare opportunities that we have to speak in foreign affairs debates, to mention all the countries and issues in which we are interested, but that is not possible especially if we are to comply with Mr. Speaker's kind request that we confine ourselves to 10 or 15 minutes.
I should have liked to say something about Cyprus, which is gradually receding into the background. Although we are forgetting it, we have a special responsibility to Cyprus. I know that we have tried to take initiatives from time to time and I am hopeful, the recent presidential elections having been completed with the possible chance now of a new start, that we shall again take up our initiatives in that country with renewed vigour.
I want to discuss disarmament and development, which are two sides of the same coin. I listened carefully to what the Foreign Secretary said today. I noticed that he said that we are asking the right questions and making constructive proposals. To ask questions is comparatively easy, and we have certainly been asking them. To make constructive proposals is more difficult.
Let us examine our policy in this respect. I am thinking particularly of the third special session of the United Nations on disarmament, which concluded about a week ago. I had the opportunity to be present at it as a representative of one of the more than 200 nongovernmental organisations that sent representatives to keep the official delegates aware of the widespread interest in what they were doing.
I heard the Foreign Secretary speak and I was disappointed. Some of his comments, such as that disarmament is for us all, were correct. He meant that every country has something to gain from disarmament, which, of course, is true. That has been said again this afternoon. But he spoke rather in the old cold-war spirit, not making constructive suggestions but demanding certain demonstrations of sincerity from the Soviet Union, among other countries. He felt that we could not make progress unless certain conditions were met by others. However, I have read his speech carefully, trying to pick out even one constructive proposal for concessions that we were prepared to make in order to make progress.
The Foreign Secretary mentioned towards the end of his speech that the United Nations special session on disarmament II
"frankly contributed to the difficult climate of 1982."
That was the session prior to this year's. That is correct—it was unsuccessful and a great disappointment. He then continued:
"Today the climate is much more hopeful. UNSSOD III can add to that hope by sending out a clear message.
The message is this: while we recognise our differences—and there are many—we can all identify our common interest in disarmament. Each state can and must make its own distinctive contribution to the common goal of peace, peace with justice and with security."
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The result of that special session was even more disappointing than the second special session. The Foreign Secretary must have been bitterly disappointed by the outcome. I refer to a report in The Guardian. It is difficult to obtain information about what happened at that special session, important though it was. This information was provided by the Associated Press in New York and reported in The Guardian. The article was headed
"UN arms cut debate ends in disarray".
It stated:
"The General Assembly's special session on disarmament ended yesterday after bitterly divided delegates were unable to reach agreement on a document calling for arms reductions."
The whole world would be disappointed—that is, if it knew what was happening—because the United Nations forum is the only way forward for many underdeveloped countries. The United Nations special session ended disastrously, despite all the money spent there. Our country could have done much more to try to make it a success.
Mr. Ray Whitney: Is the hon. Gentleman aware that one reason for the failure of the United Nations special session on disarmament in regard to conventional weapons is the reluctance of many non-aligned Third-world developing countries to reach an agreement? Therefore, to seek to pin the blame on this country is singularly ill advised.
Mr. Lamond: I accept the hon. Gentleman's point. I hope that I was not implying that the blame lay entirely on the shoulders of this country and the Foreign Secretary. However, we could have played a more practical part in resolving some of the difficulties. All that I am saying is that I do not think that we were as positive as the Foreign Secretary would have us believe from his remarks.
Halfway through his speech the right hon. and learned Gentleman said:
"We must also tackle the Warsaw Pact conventional superiority in Europe: the MBFR negotiations have failed to redress this imbalance over the last fifteen years…We remain committed to stability and security at lower levels of forces. We are working with our Alliance partners to launch a new round of conventional negotiations in Vienna."
I think that the Foreign Secretary was referring to the efforts made at the Conference on Security and Co-operation in Europe in Vienna to reach a mandate which could be carried from the conference which, I hope, is approaching its end, along with proposals about the other baskets being discussed. I have been in Vienna this week to meet some of the official delegations who are negotiating there, including our own, to ask about our circumstances and the problems that we see. Mr. O'Keefe, who is the leader of the delegation, was extremely helpful in explaining what is happening. I also met the Soviet, Polish, Austrian, and Finnish delegations and that from the Federal Republic of Germany to find out what the problems were.
I made a special request to meet the Romanian delegation which has been attacked on all sides for employing delaying tactics especially over human rights, which might mean that it would be difficult to obtain agreement, even at the end of this conference. Human rights are important. I should like to see a great advance made on what happened in Madrid. I do not support the Romanian suggestion that Madrid went far enough and that there is no need to go further. However, Romania is

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entitled, as are all the other 34 members, to put what it claims are amendments to the draft documents presented by the neutral and non-aligned nations.
The aspect that particularly interests me is the mandate for negotiation—the conference itself does not engage in disarmament negotiations, but it can set a mandate for negotiations to go ahead later this year. I hope that the Foreign Office, which has the guiding hand on our delegation, will let Romania know that we are concerned. We do not want any obstacles to be placed in the way of obtaining the mandate. I hope that an agreement can be reached by 31 July because if it is not, if there is a break and if we begin to try to negotiate again, perhaps in the middle of September, by that time the elections in the United States will be well under way. I doubt whether it will be possible to make any progress until those elections are completed. It will he impossible to begin the negotiations on the mandate during that time.
We should always remember that there are outside pressures demanding that we reach an agreement as early as possible. We should not delay any more than is absolutely essential. We should remember that concessions have to be made on all sides if progress is to be made. It is not enough to say, "Those are the concessions which must be made by the Warsaw pact countries or by the neutral and non-aligned countries"; we should say, "Those are the concessions that we have made in the hope of making progress." There is, for instance, considerable discussion about whether only the 23 NATO and Warsaw pact countries should be involved in the negotiations on conventional weapons. As my right hon. Friend the Member for Leeds, East (Mr. Healey) said, those negotiations are important. The more expensive weapons are the conventional weapons.
The other 12 countries involved in the CSCE negotiations can be placed at a little distance from the negotiations, but they should be kept informed and should be consulted from time to time. All the negotiations should be carried out within the framework of the CSCE and of the Helsinki Final Act. We should not allow any last-minute amendments such as those from Romania to the basket concerned with human rights to prevent progress from being made on the mandate section.
If we can, we should allow the inclusion in those negotiations of naval and air forces as well as land forces. It seems sensible that if one is discussing conventional arms, one discusses all conventional arms and does not try to exclude those in which one may have an overwhelming majority on one's side. If we are entering into negotiations with a determination that we shall not move an inch from the position that we held before the negotiations began, we will not make many deals, because a negotiation, deal or agreement must have something in it for both sides.
Those points should be kept in mind by our negotiators. I hope that their hard work—I appreciate that it is not easy—is on this occasion crowned with the success that it deserves and that there is not the disastrous outcome of the United Nations special session on disarmament.
8.19 pm
Mr. Julian Amery: I am sure that those who heard the speeches of the shadow Foreign Secretary, the right hon. Member for Manchester, Gorton (Mr. Kaufman) and of the right hon. Member for Leeds,
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East (Mr. Healey) will agree that we on this side of the House are lucky that the right hon. Member for Leeds, East is not on the Opposition Front Bench. That is the only party point that I shall make tonight.
Like the right hon. Member for Leeds, East, I salute the speech made by Mr. Gorbachev. I have read the fullest account that I can find. It is brave and frank, inasmuch as any man in that position can afford to be. It amounts, however, to a declaration of bankruptcy. He is saying that politically, economically, socially and morally, the Soviet experiment, which thrilled the imagination of millions of people throughout the world, has failed. For obvious tactical reasons he has sought to put the blame on individual leaders. When we look at the whole picture we must say that what Lenin hoped to do in the four or five years in which he was in charge and what Krushchev tried to do but failed is a small portion of Soviet history. Soviet history is that of Stalin, Brezhnev, Chernenko and Andropov, until the present leader came to power.
Gorbachev talks much of reconstruction, and I wish him well in that immensely difficult enterprise. A story was retailed to me a couple of days ago by somebody who was in a queue in Moscow. According to a joke that was being told, Brezhnev met Kruschev in the Soviet paradise arid said to him, "Nikita, did you build much in your time'?" Kruschev said, "No, did you?" Brezhnev said, "No. Which is why I cannot understand all this talk about restructuring. We never built anything, so what is there to restructure?"
That joke is misplaced because there is much to restructure. It will be a Herculean task because the best brains in Soviet industry are employed in the defence sector and because it will require a reduction—Gorbachev has made this plain—in the interference of the party in the day-to-day running of industry. It will require the cutting back of expenditure on defence, and, unless I am very much mistaken, securing access to Western technology and credit. Above all, it will require glasnost—freedom. The dilemma facing Mr. Gorbachev is that if he wants to make progress, he will have to extend freedom. If he extends freedom, the power of the regime will be threatened. If the regime has to choose, I fear that it will play safe and limit freedom in the interest of holding power.
That suggests that there will be a compromise. If there is, the regime will not be able to deliver the goods to the Soviet people. I shall illustrate my point with another anecdote that reached me from Moscow this week. A Soviet dog and a British dog met. The British dog said to the Soviet dog, "What is all this glasnost about?" The Soviet dog said, "It is quite easy. I am still on a leash, but it is a much longer one. On the other hand, my food bowl is even further away than it used to be. I am allowed to bark, but not too loud."
Events such as those have taken place before. In 1789., Louis XVI's expert, Mr. Necker, a banker, produced a reconstruction plan. The Estates General had a huge conference in Versailles, but while they were meeting the harvest failed and the French Revolution began.
In the old days it was often the policy to externalise internal problems by going to war—by conquest. I do not believe that that option is open any More. As long as we keep up our guard and maintain our forces, major war is made almost impossible by the existence of nuclear

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weapons. The provision of the Stinger ground-to-air missile has also made it almost impossible to win a regional war against the wishes of the people.
The outposts of the Soviet empire have been crumbling. Afghanistan is the most dramatic example, because the Red army was directly involved but had to withdraw. In Angola, Ethiopia and Cambodia the same has been happening. There is disarray throughout eastern Europe. We must bear in mind that none of those problems confronting Gorbachev would have occurred were it not for the failure of the Soviet system and the determination of the Western allies to maintain a credible and determined resistance against any possibility of aggression abroad.
Economically, ideologically and socially, the credibility of the Soviet system is at a low ebb. That can plainly be seen in eastern Europe. The hon. and learned Member for Montgomery (Mr. Carlile) mentioned Poland. Poland is no longer a Socialist country, but a sort of South American military junta with a few academics. A distinguished Polish academic, Deputy Prime Minister Sadowski, visited Britain the other day.
Czechoslovakia remains hard-line, but there is almost a war between quasi-liberal Hungary and hard-line Romania. Chaos is developing in eastern Europe. The might of the Red army remains, but its prestige and authority have been weakened. Afghanistan was comparable to what the Red army suffered in Finland in 1940. The tanks could roll into Budapest and Prague again, but would they? Not while the regime is trying to get credit from the West.
We must always remember that the Soviet Union has reached its present position only because of the failure of its system and the firm resistance with which it has been confronted abroad. We must maintain our resistance, be ready to assist with economic help and credit, but on conditions. The conditions will have to be such as to prevent the money being used against us.
On the other side of the world, there is no American crisis, but the weary Titan is becoming tired of carrying much of the burden on its shoulders. It has great interests in the Pacific and there have been anxieties in its Latin-American back yard. That has produced a demand for burden sharing. We must expect the Americans to keep a lower profile in Europe, just as the Soviets will in eastern Europe. That will not happen overnight. There will not be a sudden vacuum, but there is a gap that will need filling. How is that to be done? The main responsibility rests on the European Community. We are making good progress in that direction. Of course, we must strive to achieve the single market.
The financial and economic arguments about the European monetary system are fairly equal. I concede the point of not wanting to go in until we see the effect of France and Italy lifting all exchange controls. But I hope that the Government will not be too shy about joining in the studies into monetary union, and even a central bank. Frankfurt may have the strongest currency, the deutschmark, but we are the experts on monetary union. We often forget it, but from 1931 to 1960 we operated the most successful monetary union that the world had seen until that day—the sterling area. When we went off the gold standard, all the experts thought that the heavens would fall in. They did not, thanks to the sterling area. We
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and the other countries of the area, the old Commonwealth countries, the colonies and various other countries such as Iraq and Egypt, came out of the depression quicker than anyone else.
The system was simple. There was no central bank, but the individual national banks banked their reserves with the Bank of England. They kept full sovereign control over them, but they consulted the Bank of England and the Chancellor of the Exchequer about how to move. They often had parities at a quite different level from each other, particularly Australia and New Zealand. The system proved an immense success in the 1930s. Even more, it got us through world war two and went on into the even more difficult aftermath. We can give some lessons to the continental banks about how to run a monetary union.
It is urgent to press on because there is another, more dangerous and sinister alternative if we do not. The lower profile of the Americans and the Soviets in Europe is reawakening the dream of German unity. West Germany already has remarkably close links with the German Democratic Republic. Austria may be applying for membership of the European Community. It has not yet taken the decision, but I think that it probably will, and that will not be a bad thing. The Pope held a mass in Austria the other day at which the majority of the congregation were Yugoslays and Hungarians. Mittel Europa is rising up again, and there would be a strong temptation for the Germans to adopt a neutralist policy if this made it easier for them to secure it. If they did, and if the French went with them, we would face an economic Dunkirk. We must be careful about this.
In 1955, when the Soviets withdrew from Austria, and the need for German rearmament became paramount, we had a great argument as to how Britain should contribute. It is always boring to talk about oneself, but I wrote a memorandum, which was circulated under another name, to the Cabinet, in which I said that NATO was a box to keep the Russians out and that we needed a box to keep the Germans in. It is perhaps not diplomatic to say it now, but we must have that in our minds.
We have to play our part, a full part, in the reconstruction of Europe, and that will mean in the financial as well as the marketing arrangements. From an east European and even a Soviet point of view, it would be much better if it were done on the basis of the European Community, with ourselves and the French as the anchor men, than if we let the Germans go off on a neutralist course. Much will depend on the efforts that we are prepared to make.
8.34 pm
Mr. George Galloway: It is a privilege to follow such a legend in these debates. I hope that the right hon. Member for Brighton, Pavilion (Mr. Amery) will forgive me if I do not follow his arguments.
Like other speakers, I am disappointed that it has taken us more than a year to have this foreign affairs debate, and because we have waited so long for it I was the more disappointed in the speech made by the Foreign Secretary. I had expected it to be a tour de force of the important issues, but he demeaned the office that he holds by his childish knockabout involving the difficulties of my right hon. Friend the Leader of the Opposition. He spent more time quoting The Independent than he did on the middle east. I hope that the issue of the middle east, on which I

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shall concentrate, will occupy rather more of the wind-up speech to be made by the Minister of State, because this is a matter of the most vital importance. As other hon. Members have said, it is an issue full of danger not only for the immediate neighbours and participants in the conflicts but for the world community as a whole.
I have acknowledged before and I acknowledge again the fine words that the Government have spoken about the middle east and the Palestine-Israel conflict in particular. The Minister of State used some fine and brave words when he visited the occupied territories, which were justifiably celebrated. However, the Government are longer on words than they are on action, and I press them to do rather less jaw-jawing and rather more acting in trying to get the peace process, as it is sometimes ironically described, back on the move.
Our predisposition to words rather than action has earned us the consternation of our friends and allies in the area. Many of them are politically conservative states with whom the Government maintain warm relations. I recently visited one of them, Saudi Arabia, with a parliamentary delegation ably led by Lord Pym. At meeting after meeting with all the important people in Saudi Arabia, from the Crown Prince through to the Foreign Minister to other leaders, everyone lost no opportunity to say that while they were grateful for some of the Government's words, they rather hoped for action to back up those words.
Our predisposition has earned us the despair of the Palestinians. Those of us who have been involved in the issue for some time know that it is impossible to meet a Palestinian anywhere, especially an older Palestinian, without being reminded of our personal involvement. To some extent, we compounded the problem of the Palestinian people, so historically we bear responsibility for the tragedy and their plight. However, we seem less than enthusiastic to do something about it.
If our predisposition has earned us the consternation of our friends and the despair of the Palestinians, it is evident that it has earned us the contempt of the Government of Israel. As recent events here have shown, with the activities of the Israeli secret service over many issues and many years, the Government of Israel, whom we treat with as a friendly Government, do not appear always to be behave towards us in an entirely friendly manner.
The chutzpah, some might say the arrogance, of the Government of Israel is well known and charted, from the bombing of the nuclear reactor in Baghdad in 1981 through to the bombing of the city of Tunis in 1985, to the gunning down in a Commonwealth country, Cyprus, earlier this year of important leaders of the Palestine Liberation Organisation and to the most recent and, I believe, one of the most serious examples, the assassination, with hundreds of rounds of ammunition in front of his young wife and daughter, of the Palestinian leader Abu Jihad.
That is not to mention the contempt for international opinion that Israeli security policies in the occupied territories involved. Other hon. Members have dealt with events there, so I shall not dwell on them, but having recently been there, I know that there is a virtual reign of terror there, with tens of thousands of heavily armed soldiers putting down unrest among an entirely unarmed civilian population. The shootings, beatings and gassings mentioned this evening and many other times are ample testimony to the contempt with which the Israelis treat
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international opinion, including the opinion of Governments such as ours, who are essentially well disposed towards them.
That begs the question, "What will Britain do?", rather than "What will Britain say?" There is little evidence that Britain will do anything. I tabled an early-day motion, supported by three distinguished Conservative Members and three Labour Members, which attracted the further support of hon. Members of all parties, on the issue of limited, selective economic sanctions to try to put some pressure on Israel. After all, the Government are in favour of limited, selective economic sanctions against South Africa, but the answer was that it would not be helpful to the peace process in the middle east to introduce sanctions.
On the issue of the EEC protocols, which will come up for agreement in the next few days in the European Parliament, the Government have sent no message to Conservative Members of the European Parliament to say that they would prefer to see, as a kind of economic leverage, the continued refusal of the Parliament to agree to the protocols with Israel. It is no mean issue when Israel exports to the Community billions of dollars' worth of food, vegetables and other goods every year. The recall of Her Majesty's ambassador in Tel Aviv for consultations has been requested in this House as a means of doing something, but on this, as on other issues, those calls have fallen on deaf ears.
So much for the British Government's action against Israel. Is there any sign of British Government action towards the Palestinians? My hon. Friend the Member for Dundee, West (Mr. Ross) has dealt with that issue, so I shall not dwell on it, but it is clear that there is little prospect of the Government acting. This evening, as we speak, a meeting is going on under the chairmanship of Lord Mayhew at the Royal. Institute of International Affairs, involving Mr. Farouk Kadoumi, who is effectively the Foreign Minister for the Palestinian people. He is an important actor in the Palestinian arena, but has any Minister met him? Will any Minister meet and talk to him? I am afraid that the answer is no.
The chairman of the PLO, Yasser Arafat, and, as the Minister knows, a leader of the mainstream and moderate part of the Palestinian camp, has been continually snubbed by the Government. I hope that the Minister of State, when she winds up, will address this point. What is the difference between Yasser Arafat, as the chairman of the PLO, and Oliver Tambo, the president of the African National Congress? Why was it possible for her to meet Oliver Tambo, yet impossible for her or any other Minister to meet Yasser Arafat? There is a huge inconsistency in British Government attitudes and I hope that they will address the matter this evening or before very long.
Why do not the Government respond positively to the important statement, to which other hon. Members have referred, by the principal adviser to Yasser Arafat, Mr. Bassam Abu Sharrif, which, as the Minister must know, has caused some problems to the moderate leadership of the PLO? It would be doing a service to the peace process to respond positively to that statement and to use it as a watershed, which they appear to be seeking, to justify a meeting with the Palestinian leadership.
In short, we need to begin as a Government and as a country to try to match our words with some action. The Venice declaration in 1980 contained some fine words. That declaration ran into the sand when Lord Carrington became the President because, no doubt acting under

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instructions from the Prime Minister, he was unable to continue the process of meetings and dialogue between the European Community and the Palestinians, as the Prime Minister would not allow Lord Carrington to meet Mr. Arafat and to continue the dialogue started by the Community.
We need a new Venice declaration backed up by action because we now have a small window for a very short time. Having recently been there, I see no evidence that, unless something changes—that must mean international pressure—a Government will emerge in Israel after I November who will seriously take forward the peace process. That must mean more leverage, more action and fewer words from the international community to try to force some progress and some concessions in Israeli policy in the area.
8.45 pm
Mr. Peter Temple-Morris: It is a pleasure to follow the hon. Member for Glasgow, Hillhead (Mr. Galloway). He will forgive me if I do not go down the Arab-Israeli path because there are many things to talk about and all too little time, but he and I would find ourselves broadly in the same camp so far as our attitude to that is concerned. I particularly appreciated his remarks about the situation on the West Bank.
I want to deal with some specifics and to deal with them as succinctly as possible, to the relief of my hon. Friends who wish to contribute to the debate. The principal specific is our relations with Iran. I have followed that subject in some detail, but, in recent years, I have not overburdened the House with it. However, it is important at the moment, not least because of the general political situation there and our relation to it here, but also because this very morning, under the chairmanship of my right hon. Friend the Member for Guildford (Mr. Howell), who has already contributed wise words to the debate, the Select Committee on Foreign Affairs released a report on that subject. It was a good and balanced document, as my right hon. and learned Friend the Foreign Secretary has been kind enough to say. It reflects the need for good relations between our two countries and, on an all-party basis, it says that there should be no deals whatsoever with terrorism and that we must look elsewhere to secure the release of our hostages.
I agree that Iran—this an important message that should go out at the present time—must, if it seeks better relations, as it appears to be persuading us is the case, demonstrate its sincerity. There is no better way for it to do that than to take one very easy step—the release of Roger Cooper, a British business man and Iranian commentator, who has been languishing in the Evin prison in Tehran for two years, without trial and without any decent charge to boot. We know perfectly well that Iran could help with the hostages as well and it would be much easier for Ministers to address that question of our diplomatic relations if we had some healthy, decent and contributive response from Iran on that matter.
I want to go slightly beyond that and to discuss briefly the background because our relations with Iran go way beyond the Ayatollah Khomeini, the Mullahs, any other Ayatollah or anybody else. They are as historic as, if not more historic than, our relations on the Arab side of the
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Gulf. It was noticeable when the Select Committee went down the Arab side of the Gulf, but all too easy to forget, the historic relations on the Iranian side and the historic role that Britain has played in the development of that country. Therefore, our relations are very much with both sides of the Gulf.
We must not forget the geopolitical situation of Iran when we decide what sort of relations we should have with that country. It has hardly been in recent years an easy country with which to deal in any respect, but it constitutes 50 million people. They have dominated the region and one only has to look at the map to see the situation with the Arab Gulf on the one side and the Indian sub-continent on the other to realise that it is all-important that that country does not go any more extreme than it is already and reassumes an albeit neutral, but sensible role and relationship with the West. We have, and we have had, our traditional links with the countries of the Arab Gulf, which are smaller and perhaps more vulnerable than Iran. It is fair to say that they are vulnerable to other things than just Iran. It is all too easy to forget that there are wider issues at stake.
Our relations with Iran go far beyond the hostages. All too often the media response, the questions that we are asked and the attention that is given to Iran concentrate on the hostages. That comes to the fore, and perhaps rightly so. We are dealing, however, with the relationship between two important countries. No one will benefit more deservedly and more quickly, I hope, than the hostages if the relationship is improved. That demonstrates the importance of moving forward, and it might not be as difficult as some would argue.
Iran, through its own actions, has put itself in a peculiarly friendless position. It follows from that that it is grateful for a remarkably small degree of support that might be shown to it from Britain or any other country. There are many things that we can do, and the need to do them is made all the more necessary because of the nature of American-Iranian relations. It must be recognised that the ordinary American—this underlines an aspect of the policy of the United States Government—feels a bitter hostility towards Iran, and he does so with a certain cause. I am pleased to say, however, that this feeling is slightly better this year than last.
The Americans feel let down by the revolution. They were the principal supporter and external sponsor, as it were, of many things to do with Iran until 1979. They suffered the storming of their embassy, the taking of hostages, the abortive rescue mission and the tragedy of the events that took place at the United States marine corps headquarters in Beirut. It may therefore surprise us that the Americans, having blasted one third of the Iranian fleet out of the water—and perhaps they deserved it—are now talking to the Iranians. They are doing so nominally through intermediaries. A series of informed reports and other pieces of information suggests that the talks are active.
Why is this happening? The answer is that the Americans are aware of the importance of Iran. They believe that there is a future for that country beyond the Ayatollah Khomeini. The Iranians understand that America is such a powerful country that it has to be talked to. Britain has a more limited area of manoeuvre in which to play its maximum role in the recovery and development

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of Iran. I am sure that all agree that it will need some recovery and development. It is by actions now that its future friends will be judged.
There is an important need to press on and to act now. There is an active internal power struggle taking place within Iran and delay could make things worse. The war with Iraq is deeply unpopular in Iran and it is a country with a severely ailing leader. I dare say that it will not be long before times of change are upon us. I much approve of the talks that are taking place on embassy reparations between our Government and that of Iran. It was none too soon when the talks started. We are taking the road to better relations behind the French, and I do not condone any deals that may have been done with that country. Nevertheless, relations between France and Iran have already been restored. The Germans, the Italians and the Japanese also have relations with Iran. Britain is the only European Community country that does not have diplomatic relations with Tehran.
In bringing about relations with Iran we should at least consider a slightly more independent policy and attitude. We are seen to be very much part of the alliance with the United States, and most of us in this place back that alliance. There is ample scope, however, for some independence, and especially within the United Nations. We played a formidable role when it came to resolution 598, but there has been precious little follow-through from that. We have done little to extract the maximum Iranian response to it. Indeed, we continued to be a party to even more action against Iran by way of an arms embargo until it proved politically impossible to take that line any further. That is dead, in part because Iraq has felt free to escalate the war in various aspects, some of them extremely unpleasant.
I shall refer briefly to South Africa. My hon. Friends will be relieved to hear that I am not going round the sanctions course. I am concerned, however, that the British position on sanctions, present or future, will lead to Britain becoming isolated internationally. It was evident at the time of the 1986 differences—it has been evident ever since—that we stand alone to some extent.
We are approaching an American election, and until this moment we have been reinforced in our attitude towards sanctions and towards South Africa generally by the United States Administration. If the Democrats form the next Administration, there will be a change of policy towards South Africa—deed, there could be change whatever the new Administration. That poses a danger for us. If we are to be isolated on anything, it should not be on our policy towards South Africa.
The BBC external services have long been one of my hobby horses. It is an issue that I shall not go into in detail this evening. I have a personal interest and I have spoken before about it. The result of the Government rejecting what I humbly urged is that the BBC is going to the private sector for finance for satellite television news services. It seems that there will be a City initiative, and there is every likelihood that it will be successful. That is good and commendable. I hope that the initiative will be successful, but private capital needs a return.
It is a difficult market, as the ITN Superchannel experience shows. There is a danger that a major strength of BBC external services, which is directed towards the Third world and to giving the right message to the countries within it, will be separated from the developing market of television. I urge the Government to keep the
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issue under constant review. When they assess the BBC's external services budget, I urge them to bear in mind the Third-world countries at a time of increasing consumption of television. There could well be a case for certain specific subsidies to be given and for certain additional moneys to
be provided.
Several Hon. Members rose—
Mr. Deputy Speaker (Sir Paul Dean): Order. The winding-up speeches are expected to begin at 9.20 pm. If we could have four-minute or five-minute speeches, hon. Members would win golden opinions from the Chair.
8.58 pm
Mr. Chris Mullin: I want to address one small aspect of British foreign policy which is very topical and important. I want to refer to the support of Her Majesty's Government for the Khmer Rouge and Pol Pot. In the vote at the United Nations each year we vote for a regime that has no territory and controls no population except people in refugee camps and we supply a small amount of food to the United Nations border relief operation which feeds the Khmer Rouge.
We are only a small partner in this matter. The real villains are China which supplies the guns, Thailand through which the guns travel to the Khmer Rouge, and America which provides the bulk of the food—along with other Western countries—and organises diplomatically to ensure that the fraudulent coalition, which is a thinly disguised front for the Khmer Rouge, is recognised at the United Nations each year.
That is a cynical and wicked state of affairs. With the possible exception of the Minister, everyone knows what is happening. Oxfam has done a great deal of good work in the area for the Kampuchean people. It is desperately
worried that, with the withdrawal of the Vietnamese from Kampuchea, the return of the Khmer Rouge is becoming inevitable. I know that that concern is shared by hon. Members on both sides of the House, and more than 230 Members of all parties have signed early-day motion 463.
If the situation is not understood in the Foreign Office, it is well understood in the world at large. Jane Corbin a "Panorama" reporter, was in Kampuchea a few weeks ago. She wrote in the Radio Times:
"The Khmer Rouge are still out there in the jungle—Pol Pot still controls their military strategy and the West supports them and their allies as the legitimate government."
In January this year The Nation in Bangkok wrote:
"Both Thailand and China are staunch supporters of the Khmer Rouge. They consistently insist that the communist group be included in any future settlement to the Kampuchean conflict."
The record of the Khmer Rouge regime, when it was in power between 1974 and 1979, is well known and I will not dwell upon it. The Vietnamese invaded at the end of 1978 in the face of severe provocation, with massive attacks on their western provinces, and huge numbers of refugees were driven into Vietnam. Similar attacks were also made on Thailand. The invasion by Vietnam which removed the Pol Pot regime provided the excuse for the West to continue a trade and aid boycott of Vietnam. I say "continue" because Vietnam's main offence was not to invade Kampuchea but to defeat the United States in 1975. Much of what has happened since then is motivated by revenge.
I have visited Vietnam many times over the past 12 years. My wife is Vietnamese and her family live in Ho Chi

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Minh city. I was in Kampuchea in 1973 and saw American B52s burning the country down. I was in Kampuchea again in 1980 shortly after Pol Pot and his friends left the town. I have some idea of what is involved.
It is my conclusion and that of many who have studied the problem that the object of supporting the Khmer Rouge in Kampuchea is to bleed Vietnam. The object is not to get the Vietnamese out of Kampuchea; the object is to keep them there. I believe that the Vietnamese are desperate to get out of Kampuchea. In fact, they are now so desperate that they are about to call the bluff of those who have been supporting the Khmer Rouge all these years.
The Vietnamese are going and there is no strong evidence that the Heng Samrin regime, which the Vietnamese will leave behind, has the capacity to survive on its own. It is widely acknowledged, as any reader of our newspapers over the past few days, and in particular of The Sunday Times last weekend, will know, that there is now a serious danger that the Khmer Rouge will return to power.
Those who continue to support the Khmer Rouge will have to bear responsibility for what happens. I hope that the Minister will refer to this in the reply. However, I hope that the Minister will not pretend, as happened when my hon. Friend the Member for Cynon Valley (Mrs. Clwyd) and the hon. Member for Broxtowe (Mr. Lester) raised the subject in an Adjournment debate some months ago, that none of this is happening.
One of the problems in raising the issue, as I and others have tried to do in the House, is that it is difficult to have a rational dialogue because the Minister directly responsible is Lord Glenarthur who is in another place. The Minister who deals with the matter here specialises in South America and has not, to my knowledge, been a frequent visitor to south-east Asia. I understand that the Foreign Secretary has taken a personal interest in the position in Kampuchea. I hope that one of the Ministers will find time to address the matter and not sit around awaiting instructions from Washington as to what we should do next.
We need to stop voting each September at the United Nations for the Khmer Rouge, and to urge our allies to do likewise. An international force will have to be raised swiftly to fill the awful vacuum that will be left when the Vietnamese leave. We must try to persuade the Chinese— and many people seem nervous about offending them—to cease supplying the Khmer Rouge with guns, and our main western allies, including the United States, to halt the food supply. We must also tell Washington and China that we are no longer prepared to be party to a cynical fraud. Otherwise, we must all take a share of the responsibility for the renewed calamity that faces the people of Kampuchea.
9.6 pm
Mr. Jim Lester: I believe that I am known in the House as a man of considerable patience but, having sat here for a long time, to be asked to make a proper contribution to this debate in just five minutes is really disgusting. Thirty-five hon. Members wish to contribute their comments on these critical matters, and we are jumbled into a gabbling five minutes at the end of the debate
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The three situations that I wish to mention result from the winds of change—one might call them the gales of change—now proceeding from Moscow. For the first time, we can begin solving regional conflicts, which have been so very serious since 1946. The total of 17 million war dead and 25 current wars is not a record of which the world community can be proud, and neither is the increasing number of refugees across borders and within countries. As was said by the right hon. Member for Leeds, East (Mr. Healey), we now have a new opportunity to solve those problems.
The first area I wish to mention is Ethiopia, of which I have considerable knowledge, having visited it every year since 1984. Dramatic international action must be taken to crack the war there. There is no way, despite humanitarian aid and other efforts, that we shall save that country from decline unless we halt the conflict there. In 1960, it was the poorest country in the world, and in 1985 it was still the poorest country in the world. I urge my right hon. Friends on the Front Bench to do all that they possibly can, in consultation with the Soviet Union, to bring the warring parties in Ethiopia together. If nothing is done, there is no question but that it will decline into another Palestine.
The latest proposals from the Addis Ababa Government give an opportunity to recognise the genuine aspirations of the Eritrean and Tigrean peoples and to establish autonomous states within an overall situation. The problem is now desperately urgent, and those of us who were in Ethiopia in February could see the consequences of the drought, the war and the degradation. There will be ever-increasing famines, affecting ever-increasing millions of people. All that will continue unless we take direct action.
The second subject that I wish to mention is southern Sudan and the suffering of the Dinke people, who are caught in traditional tribal conflicts. There are now people armed with Kalashnikov rifles who can kill hundreds, whereas before, armed with swords and spears, they could kill only a few. The people there are caught in the trap of a civil war and are fleeing in huge numbers into Ethiopia, where there are now a quarter of a million of them in camps. They are also fleeing in great numbers to the outskirts of Khartoum. Those of us who have witnessed the situation have seen them surviving on rubbish tips and being given the least possible help from the Government of Sudan, who are concerned that, if they offer help, more refugees will follow. No requests have been made to the international community. The problems there are of major importance and should be among our highest priorities.
I welcome the agreement with the International Red Cross, whereby it can operate in areas of conflict in relieving the breakdown of all normal conditions. However, we know that access to the area is still not secure and the International Red Cross has been unable to undertake any surveys of need there. When it does, the results will be devastating. We need to be ready to respond urgently to the terrible conditions of the Dinke people in southern Sudan.
I hope that my final point may be the most helpful, because it was raised by the Foreign Secretary himself. It concerns Cambodia, which I visited at the end of last year, together with the hon. Member for Cynon Valley (Mrs. Clwyd). A reappraisal by the Soviet Union and the Vietnamese has led to a substantial reduction in forces. The fact that the Vietnamese troops have moved away from the Thai border has lessened the tension between

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those countries and the prospects during July for discussions of all elements directly involved are welcome. I hope that the incredible work done by Dr. Mochtar of Indonesia will bear fruit. The role of Prince Sihanouk could be essential as a catalyst for bringing together all Cambodians of good will to end the nightmare of recent years of those people within the country—not least, those in the camps that many of us have seen on the Thai border.
Active diplomacy by my right hon. and learned Friend the Foreign Secretary is needed. I am grateful that he mentioned this matter in his speech and I hope that it means, first, that he will ensure China's involvement in reducing support for the Khmer Rouge in line with the Vietnamese withdrawal, and, secondly, that he will be prepared to convene or reconvene an international conference as co-chairman, as we did in 1954 on the Geneva accord.
When the time is right, and is judged to be right, we shall have a role to play, most urgently to ensure that the disturbing reports of movements of arms from the camps in Thailand and of personnel being selectively sent back into villages within Cambodia cannot be used to see the return of the Khmer Rouge by force of arms. There are many reports now in the international press of the real concern about that prospect.
The prospect of a United Nations peace-keeping force would appear to be bleak. The prospect of Vietnamese withdrawal by 1990 or before seems likely. Therefore, it behoves the international community, particularly Britain and America, to be sure to take active diplomatic action to ensure that there is no prospect of a return of the Khmer Rouge in any other form.
We cannot continue to blame the Vietnamese as they start to make positive moves. I recommend my right hon. Friends in the Foreign Office to change their word processor so that it does not keep churning out the same message. Bearing in mind the economic problems of that country, the desire to end the debilitating exodus of refugees and their problems throughout the world, especially in Hong Kong, the European Community should make common cause in anticipating the circumstances of changes in the policy of aid to both Kampuchea and Vietnam and in ensuring that the conditions that we have set are fulfilled. We must discuss in advance the internal response to evolving events as recommended by the Select Committee on Foreign Affairs.
I have great respect for my colleagues in the Foreign and Commonwealth Office. I know from contacts that I have had since 1982 that our role in diplomatic channels is out of all proportion to our economic power. However, in the issues that I have tried to deal with in such a short time we have an important role to play. If we start to obtain settlements in those areas, they may be the bricks with which we can start to build the international community that the right hon. member for Leeds, East mentioned in his peroration.
9.14 pm
Mr. Max Madden: As the representative of the largest Pakistani community in Britain, I wish to refer briefly to two early-day motions that I tabled recently. The first, early-day motion 1239, headed "Democracy in Pakistan", called for free, fair and impartial elections to be held in Pakistan and for those elections to be conducted on a party-political basis. It also
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urged the immediate release of all political prisoners held in Pakistan. In response to that motion, the Pakistan ambassador in London wrote to me saying:
"As regards the release of political prisoners, to the best of my knowledge there is not a single political prisoner in Pakistan. There are however some politicians who are serving prison sentences because of the criminal acts for which they were convicted by courts of law."
The campaign for democratic rights in Pakistan has produced a list of the names of 823 political prisoners who are now held in Pakistan. I hope that the Minister of State will agree to pass that list to the Pakistan ambassador in London so that he can forward it to his Government. Certainly I hope that the British Government will also continue to support representations being made to the Government of Pakistan about the denial of human rights and the other matters set out in my early-day motion.
The second early-day motion is 1246, headed "Diplomatic Service", which calls for the Consular Fees (Amendment) Order 1988 to be revoked. That may seem a strange thing to do, but the order increases visa settlement fees for those wishing to enter this country from £50 to £60 and, more important, imposes that charge for every applicant, whereas previously it was a charge in respect of each passport. It means, therefore, that in future a mother with three or four children will have to pay £60 per person, whereas previously that was not the case.
That situation must be recalled when the Prime Minister stands at the Dispatch Box and expresses concern about divided Jewish families and those Jews who are anxiously awaiting visas to leave Russia. Yet it is the policy of her Government to prevent. Asian women and children from being united with their husbands and fathers in this country. We have from the Prime Minister and this Goverment compassion for Jews and indifference to Asians wanting to come into this country.
Many people, of all political parties and of no political party, are deeply angry that our Government are now spending less of this country's total wealth on aid and development. Instead of playing around with identity cards to curb young hooligans, many of whom reflect the naked and nasty nationalism that is the badge of Thatcherism, why do we not try to give our young people some new sense of purpose, some new perspectives on foreign countries and the people who live in those countries, by providing more opportunities for voluntary service overseas?
A great many British people are ashamed and angry that the British Government are one of the biggest arms salesmen in today's conflict-torn world. It is wrong that Britain should be supplying weapons to both sides in the seven-year-long slaughter which is called the Iran-Iraq war. It is wrong that Britain should be supplying arms to all countries on the Indian sub-continent, including Bangladesh, probably the poorest country in the world; to Pakistan and India, both of which have a nuclear capability in a critical region of the world. It is wrong that the desperate desire to cement the special relationship between Britain and America should compel Britain to pursue policies in direct or indirect support for dictatorial regimes that suppress their peoples by force and deny human rights, or forces seeking to overthrow democratically elected Governments.
The British people want Britain's foreign policy to be genuinely independent. They want the people of all countries, including South Africa, to have the right to

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determine their own destiny. They want to see an end to all military pacts. They want international co-operation, not international conflict. They want the Government and all who serve the Government to observe the rule of law and to tell the truth. We face great difficulties in this regard so long as our backyard, Northern Ireland, is so torn by conflict of every sort. That is why I welcome today's launch of the "time to go" charter, which seeks to bring peace, reconciliation and a genuine political solution to the troubles of Northern Ireland.
No one in his right mind in Britain today thinks that Russia poses a threat to this country. That has been echoed by a number of hon. Members who have spoken in this debate. I should like to join forces with all those who have urged that we should have a regular opportunity to debate foreign affairs in this House, and certainly that such opportunity should be on a more regular basis than has been the case in recent years.
The vast majority of British people, welcoming the efforts of Mr. Gorbachev to lessen the threat of nuclear war, think it mad for us to spend billions of pounds on Trident submarines. Trident should be scrapped now. The money saved should be diverted to building new homes, rebuilding the National Health Service and increasing this country's manufacturing base, which so badly needs help.
Our people want peace, jobs and freedom for themselves and for their brothers and sisters around the world. That should be the purpose of Britain's foreign policy, and I hope very much that that type of foreign policy will be pursued in the not-too-distant future.
9.19 pm
Mr. George Robertson: I think that all of us hoped that the debate would be longer, so that more hon. Members on both sides of the House could speak. All too frequently so many hon. Members wish to give their views on many important issues. But I shall try to be brief.
I am conscious of time. Last week I attended a conference in the capital of the German Democratic Republic. In a session chaired by the vice-chairman of the Dutch Labour party, Mr. Klaas de Vries, we had the delicious sight of the No. 2 in the Romanian Politburo being ordered to leave the rostrum because he had overtaken a time limit that even the East Germaans thought reasonable for him. That is not a common sight, and I think that we all learned a lesson from it.
It is customary for those who make winding-up speeches to remark that the debate has ranged over a wide area. That is no exaggeration today. It is impossible for me—and, I am sure, for the Minister—to encompass all the issues that have been raised. Many of those issues are very serious. I share the concern of my hon. Friend the Member for Glasgow, Hillhead (Mr. Galloway) about the inadequate amount of time that the Foreign Secretary spent on the crucial issue of the middle east. I know that he is pressed for time and must put as much as he can into his speech, but it seems remarkable that he should give that subject such an inadequate response—two or three sentences—at a time when the area is in ferment and is so critical a part of world events.
As my hon. Friends the Members for Hillhead and for Dundee, West (Mr. Ross) pointed out, there have been important developments recently on which we might have
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expected a Government view. One of the most important is the statement by Mr. Sharrif on behalf of the PLO, showing a number of crucial movements in the organisation's position on the occupied territories. Considerable dissension has been caused within the ranks of the PLO, but the peace process may have been brought somewhat closer by the clear move towards a position that has been established in the world community and should naturally identify itself at least with progressive elements in Israel. It is sad that the Foreign Secretary did not deal with that.
The European Community has been mentioned by a number of speakers—fleetingly by the Foreign Secretary, because his mistress has spoken before him——
Mrs. Chalker: I have not said anything yet.
Mr. Robertson: The right hon. Lady may confess or accuse in any words that she chooses. The fact is that the Foreign Secretary's real mistress spoke on behalf of the Government, although she did not speak in much detail about the issues on which the questions were put. The Foreign Secretary did not speak about any of them either.
My right hon. Friend the Leader of the Opposition asked, clearly and without ambiguity, whether this country would use its veto in the European Council against any imposition of VAT on all the items that are now zero-rated. The lack of an answer yet again shows what the British people can expect when the matter comes before the majority-voting European Council in the future.
We heard little or nothing, either in the statement on the Hanover summit or in the Foreign Secretary's speech, about the impact of the single European market on the bulk of British industry. We are left yet again, after expensive advertising campaigns, with the impression that big Europe will be for big business. That is sad news for those who are involved in small and medium-sized business, as well as for those employed by them.
My hon. Friend the Member for Islington, South and Finsbury (Mr. Smith) and others mentioned Iraq. It is worth putting on record the sense of outrage at the unspeakable use of chemical weapons against the Kurds in northern Iraq. The world community has undoubtedly been revolted by the scenes, fleetingly brought to our television screens, of the bodies affected by these noxious indefensible gases.
Naturally the Iran-Iraq war has been a subject of considerable anxiety, and the hon. Member for Leominster (Mr. Temple-Morris) and others raised it. It is important to underline the fact that if Iran wants to return to acceptability in the civilised world, there are easy options open to it to show its bona fides. There would be no greater sign to this country of its willingness to rejoin the international community than by doing something about the hostages in Beirut or Mr. Roger Cooper, whom it incarcerated directly in its gaols. Those of us who believe that Iran could again play a major role on the world stage look carefully for signs that it will take giant steps forward.
The right hon. Members for Old Bexley and Sidcup (Mr. Heath) and for Guildford (Mr. Howell) mentioned the role of the United States of America. Although we tend to get carried away with the developments in the Soviet Union, we should not be diverted from the issues being raised in the American presidential elections. Whoever wins—those of us on this side of the House do not show

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partisanship, although the Foreign Secretary may squirm and turn, trying to preserve some impartiality—whether President Bush or President Dukakis, he will face massive problems which cannot be dealt with unilaterally. We, together with America's allies elsewhere, are obliged to ensure that multilateral decisions are dealt with properly and adequately.
The hon. and learned Member for Montgomery (Mr. Carlile), the hon. Member for Cambridge (Mr. Rhodes James) and my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) dealt with South Africa in some depth. A distinct sense of shame should attach to the British Government after this week's Hanover summit. They may say that sanctions were never raised and that their voice was strong, but we know from the foreign and British press and from everything that has come from the summit that the British Government sought to dilute the strong message that could have gone to Pretoria on the subject of the Sharpeville Six. Any dilution of that message is wholly reprehensible. A bogus system of law is about to be translated into the execution of people who would not even face sentence if they were tried under a decent system of law.
Afghanistan was mentioned and the question about the Pakistan Government's failure to adhere to the Geneva agreement on supplying arms to the Mujahideen. My hon. Friend the Member for Sunderland, South (Mr. Mullin), who has a deep interest in the matter, asked about Kampuchea, and we look forward to the Minister telling the House the glad tidings that, in the light of the exodus of Vietnamese troops from Kampuchea in September, the British Government will for the first time refuse to vote in the credentials committee of the United Nations for the coalition that includes the barbarous and murderous regime of Pol Pot. That would be a symbol of the Government's intention to act independently of the super-power politics that keeps that small country in oblivion.
The debate has inevitably been dominated by today's events in Moscow. The changes in the Soviet Union and their impact on the rest of the world have been profound. There is no doubt that the East-West relationship affects all parts of the globe, whether it be the middle east, eastern Europe, the Gulf, South Africa or even Ethiopia about which the hon. Member for Broxtowe (Mr. Lester) spoke so authoritatively. They are all touched by the ideological and military confrontation between East and West, so any movement will ease many of the problems.
The hon. Member for Arundel (Mr. Marshall) mentioned the work of the Inter-Parliamentary Union in the development of relations between the Soviet Union and Britain. Those of us who have watched the Soviet Union, sometimes there and sometimes through meetings with people here, have witnessed dramatic changes in the attitudes of people there. Their conduct has been moderated and revolutionised. In Moscow this week we are seeing something which has almost totally transformed the situation yet again.
In February 1986, I went to the 27th congress of the Communist party of the Soviet Union. That was radical enough. Being one of the first non-Communist observers sitting in on a Communist party congress was peculiar, new and unique. I said on British television that it reminded me of the Conservative party conference, except that in Moscow they have done away with the cult of the personality. Those of us who sat through the congress can
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watch the television pictures coming from Moscow this week and see something that is different, radical and original, and yet still full of risks.
Like the right hon. Member for Old Bexley and Sidcup, I do not believe that we should be patronising or that we should attempt to lecture the Soviet Union. We should encourage the process of openness and restructuring which, as it revitalises the Soviet Union, will reduce tension in the world. We hope that things will develop.
The most direct consequence of the easing of tension in the world and of changes in the Soviet Union is in arms control. Lord Carrington, who I notice lost his peerage in the Foreign Secretary's opening speech—that probably indicates that the Foreign Secretary knows something that we do not—retires as Secretary-General of NATO this evening. In an interview in The Times today, he says:
"It takes much too long to get the NATO act together. We have been slow, slow, too slow. Somehow or other we have let it be thought that arms proposals which were all our idea were Gorbachev's initiatives. In fact, everything that has been achieved was first suggested by the West. That is a failure on our part."
Those words carry substance. authority and the ring of truth.
There is nothing in the NATO act today that suggests that it is getting it together. What on earth is going on in the NATO posture in so many areas of arms control today? The modernisation of weapons is a concept which was dreamt up at Montebello in Canada, and it is now being interpreted, reinterpreted and battled over in the North Atlantic Alliance.
Mr. Carlucci, the American Defence Secretary, in a rare moment of candour, which the British Government do not usually share, is reported as saying at the end of April:
"The meeting"—
the NATO meeting—
"had also endorsed the development of a new air-launched missile and a successor to the Lance battlefield missile in West Germany."
My right hon. Friend the Member for Leeds, East (Mr. Healey) spoke with considerable authority about this matter. There are 88 Lance missiles—short-range battlefield weapons—in allied control. The Soviet Union with its Frog and Scud missiles has a 14:1 advantage over NATO forces in such weapons, but an offer by the Soviet Union in a third zero completely to eliminate all such short-range battlefield nuclear weapons was rejected out of hand by the West and more emphatically by the Prime Minister of this country. That has created tremors within the Alliance, as Germany has every interest in these weapons being thrown out and is aggravated by the Prime Minister's stance. Not only do we give the Soviet Union a propaganda advantage, because it has said that it will eliminate the weapons systems, but we lose the opportunity to get rid of a weapons system that everybody knows is much too dangerous.
The news contained in this week's Jane's Defence Weekly was cited by my right hon. Friend the Member for Leeds, East. General Kirk, chief of the United States air force in Europe, said that 51 FB111 bombers will be reconfigured as F111G bombers carrying air-launched cruise missiles capable of striking all the targets in the Soviet Union—and more—that were covered by the cruise and Pershing missiles eliminated by the valuable INF treaty of which the Government are so proud.
On the conventional side, the offer made in Moscow, which the Foreign Secretary mentioned in his opening

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speech, has gained only limited approval in the West, despite the fact that its component parts—the exchange of data, followed by unilateral reductions in asymmetry and imbalances in forces, followed by negotiated and equal reductions in those forces, followed by a restructuring and reposturing of forces on the central front—are precisely the ideas put forward so often and so regularly by the West in practically every one of the forums to which we had access.
At a conference that I attended in East Berlin last week, I spoke to Mr. Georgy Arbatov, of the Institute of US and Canadian Studies and a close confidant of Mr. Gorbachev. When I asked him about the offer, he said, "It is genuine. Just test us." The Foreign Secretary should take note of that message, and it is the message that should go out from the House.
Our relationships with the super-powers extend beyond that. Even with our allies, we must be concerned about what is going on. Extra-territoriality is not a word that trips easily off the lips, yet the extra-territoriality of American laws, which extends throughout the world, gives due cause for concern, even to the friends of the United States. The COCOM system is one that people increasingly believe is not being used to starve the Soviet Union of strategic goods that could assist its defence effort but rather as a form of techno-nationalism on the part of the United States. That is worrying, and there must be no collusion in it by the British Government.
Also worrying are some of the attitudes adopted by the Americans in pursuing people who fall foul of their commercial export law. Mr. Brian Butcher and Mr. Clifford Chandwick were arrested last month at Rome airport. Both those British citizens were arrested by United States agents and are now incarcerated in Italian gaols. Their case must send shivers down the spines of many business men involved in activities in which American law is radically different from the laws operating in this country.
We should not take it lying down; we should react when British citizens are being arrested in friendly European Community countries. I do not believe that it is right to be sanguine when agents of a foreign power—albeit a friendly foreign power—stand around on street corners enticing British citizens and British business men into acting in such a way that they can be arrested and subjected to laws with which we do not agree and that we would not tolerate in this country.
I shall ask the Minister some brief questions about that case. Have the Italians offered to repatriate the two business men and subject them to British law? Secondly, did this near-kidnapping violate any agreement between Britain and America to declare the targeting of citizens who are suspected of breaking particular laws? Have the Americans ever applied for the extradition of Mr. Butcher or Mr. Clifford Chandwick? If not, we must and will draw the obvious conclusions.
This has been a long debate covering a wide range of issues. Such debates are rare events these days in this Parliament; they should be held more often. Inevitably, we have to cover too wide a range of diverse issues in a short space of time. Foreign affairs should be given much more time.
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What do we discover about Britain's foreign policy from the Ministers who address us in these debates? Sadly, very little. We hear a lot of bluster and glowing notions of an exaggerated British influence in a world in which Britain, through this Government, all too often refuses to play a constructive role. But there is a role for us in the institutions in which we still have a voice. We can be a force for reason, balance and enlightenment in the United Nations, the European Community, NATO and the Commonwealth. Britain needs to speak out in these organisations—it rarely does—to ensure that the new era in world relations is consolidated and strengthened. The sooner it does so, the better for all of us.
9.41 pm
The Minister of State, Foreign and Commonwealth Office (Mrs. Lynda Chalker): As the hon. Member for Hamilton (Mr. Robertson) said, we have had an interesting debate. As always, the value of almost every contribution has been high and the range of subjects broad. The conduct of foreign affairs frequently stimulates advice from every quarter. We may not always agree with what colleagues say in the House, but we always listen.
The debate has ranged from the middle east to Cambodia, from the Soviet Union to southern Africa. May I say at the beginning how much I welcomed the remarks of my hon. Friend the Member for Arundel (Mr. Marshall) about the work of the IPU. The work done by hon. Members through the IPU is an excellent foundation for building up the necessary relationships on which greater understanding is based and which can often help us through some of the more difficult misunderstandings that Government to Government relationships sometimes cause.
Mr. Michael Marshall: As my right hon. Friend is aware, I had to cut short my remarks and could not touch on the relationship between the British group of the IPU and the Government. The interest that my right hon. and learned Friend the Foreign Secretary and his ministerial team and officials take is a key part of the way in which the organisation can work.
Mrs. Chalker: I thank my hon. Friend for saying so. We derive great value from doing that.
Because the complex changes in the world happen all too slowly, we should be cautious about rushing to conclusions. Nevertheless, by any standards, there have been some momentous developments since our foreign affairs debate last year. In addition to the notable first visits between Moscow and Washington, the most momentous happening has undoubtedly been the signature and ratification of the INF treaty which, for the first time, will abolish an entire category of nuclear weapons.
We have also made considerable progress on the strategic arms reductions, as well as gaining signs of movement on conventional arms control, which, as my right hon. and learned Friend said earlier, is at the heart of western European security. At long last we are witnessing the beginning of the end of the Soviet Union's eight-year occupation of Afghanistan.
In large measure these positive signs are the fruit of policies pursued consistently by Britain and the West. We have not tacked, nor have we been steered by the prevailing wind, nor have we rewritten our policies every

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time we met an obstacle. For us, the security of western Europe is paramount, yet we have succeeded at once in maintaining that security, in building up good relations with the Soviet Union and in cutting back on arms levels. The Opposition, by contrast, would sacrifice the unity of the western Alliance for the unity of their party, which I find sad. They would sooner dismantle our own defences than upset the trade unions. That is a strange way to run a foreign policy.
I shall not speak at length about the European Community. My right hon. Friend the Prime Minister reported on the Hanover summit earlier this afternoon. We have worked, and shall continue to work, for the prosperity of Britain and Europe. During the past six months, enormous progress has been made towards realising our objective of creating a single market by the end of 1992. We gained agreement on mutual recognition of qualifications that will open up new job opportunities throughout the Community. We have an agreement at last to abolish lorry quotas that have been a block on trade for years. We have an agreement to allow the free movement of capital throughout the Community. I hope that Opposition Members will note that the rest of Europe, of whatever political persuasion, has willingly followed the lead set by this Government in liberalising capital movements in our first term.
We have set an agenda for European work next year. Again, it is a practical realisable agenda seeking progress on issues such as the further opening-up of financial services, the further liberalisation of transport and greater openness of public purchasing. Those measures will benefit not just our companies but our people by creating further growth and new jobs.
At the beginning of the debate, the right hon. Member for Manchester, Gorton (Mr. Kaufman) made an unusual speech, to say the least. I said that I was always ready to listen, but today the right hon. Gentleman tested my patience and probably the patience of many other hon. Members. I will not follow his line of argument because I shall cover the points that he made with others on similar subjects. However, he did raise one matter about which I should like to put a direct answer on the record. He spoke in quite exceptionable terms about the events in Gibraltar in March. I shall say no more than a single paragraph about this.
The preliminary hearing in respect of the inquest into the deaths on 6 March of the three IRA terrorists will open text Monday, 4 July, in Gibraltar. It will be held between the coroner and counsel, without a jury, and will address procedural matters only. We expect it, and it alone, to set the date for the main inquest. We hope that that will be held as soon as possible. Until the inquest is completed, it remains inappropriate to comment further on the events surrounding the deaths of the three terrorists.
Mr. Dalyell: Will the right hon. Lady give way on a factual point?
Mrs. Chalker: I understand that the hon. Gentleman was not able to speak in the debate. However, my time is very short, so perhaps he will allow me to get on to other matters.
By contrast, the House really enjoyed the contribution of the right hon. Member for Leeds, East (Mr. Healey). How much he is missed from the Opposition Front Bench. We were delighted to see him back in our debates today.
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In giving him that warm welcome back, I should say that it was great to have the most interesting speech of my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath). Both spoke with wisdom and sincerity about the dramatic changes taking place in the Soviet Union.
It is clear that the Soviet party conference is a real landmark in the Gorbachev reform process. We are watching the progress of that conference with great interest and welcome the thrust of the attempts to move the Soviet Union in a more liberal, efficient and humane direction. However, the task of bringing about such political and economic change in the Soviet Union remains enormous and the time scale for noticeable results will be long. We have noted Mr. Gorbachev's bold proposals For constitutional reform. We want to see whether the conference will endorse them.
It is not for us to interfere in Soviet internal affairs, but any measures which tend towards greater freedom and prosperity for the Soviet people and which reduce the total grip of the Communist party on Soviet life are naturally to be welcomed. At the same time, let us be in no doubt that what Mr. Gorbachev seems to have in mind is not democracy as we know it, or anything like it. He wants to reduce the party's abuse of power but retain it as the sole effective political force. There can be no popular choice in such a system. The House must remember, above all, that Mr. Gorbachev is not a social democrat. His inspiration is Lenin, not Limehouse.
The hon. and learned Member for Montgomery (Mr. Carlile) mentioned human rights in the Soviet Union. Although progress has been made, much more needs to be done. We must continue pushing for an end to human rights abuses in the Soviet Union and for people to be allowed to leave. I know that the hon. and learned Gentleman was concerned about that matter.
Many hon. Members have commented on the INF treaty. It is a good agreement, a triumph for Alliance solidarity and for the strategy of negotiating from strength. There will be assymmetrical reductions because it involves a set pattern for similar reductions that will be needed in other arms control negotiations. Stringent verification provisions are a good precedent for future negotiations. It is the first agreement to result in a reduction of nuclear weapons.
I noted what the right hon. Member for Leeds, East said about his reading of Jane's Defence Weekly. The hon. Member for Hamilton repeated those remarks. There is no question of circumventing the INF agreement, and nor will there be. I shall look again at what the right hon. Gentleman said and at Jane's Defence Weekly.
Mr. Healey: The right hon. Lady is presumably in touch with the Secretary of State for Defence. The statement made by the general commanding American forces in Britain was quite unequivocal. He will receive over 50 F111 aircraft modified to take between two and four cruise missiles, which would mean that there would be many more air-carried cruise missiles based in Britain than there were to have been land-based cruise missiles before the INF agreement. Circumvention may mean anything to somebody briefed by a Foreign Office official. We want to know whether the Government have agreed to receive those aircraft, as stated by the American general.
Mrs. Chalker: That is why I said that I would look into what was written in Jane's Defence Weekly and come back to the right hon. Gentleman. There is no question of us circumventing the INF agreement.
We are not and never have been in the business of building up nuclear weapons. Our determination, through NATO, is to maintain minimum nuclear stockpiles such as are necessary for credible and effective deterrence. Beyond that we shall not go. NATO has agreed that the measures necessary to ensure effective deterrence will be taken on a step-by-step basis. No decisions about modernisation measures as they affect United Kingdom forces have yet been taken. At the same time, we note that, as the hon. Member for Hamilton rightly said, Soviet modernisation continues at speed. He gave the figures for Frog and the SS1 replacements for Frog.
We must never forget that our gravest concern is the conventional imbalance in Europe. The Warsaw pact is ahead of us in manpower—4 million men compared with our 3 million. It is ahead of us in tanks by a ratio of 3:1. It has a 3:1 advantage in artillery and a 2:1 advantage in aircraft. As long as that remains, we must ensure that we carry through all treaties in the interests of the defence of this nation and the West.
We often hear about the INF treaty being based on the acceptance of our zero option. Yes, it is a breakthrough in weapons reduction, but I find the Opposition version of zero option quaint. We would have the zero, but the Russians would have the option. They would take the missiles and we would have to take to the hills. That is about as good as the Opposition zero option.
We want, and are working for, a comprehensive, verifiable and worldwide ban on chemical weapons, and that is a priority both for us and for NATO. We know that, by working actively in the negotiations in Geneva, we shall eventually succeed, but we have always realised that, sadly, early agreement is unlikely.
My right hon. Friend the Member for Old Bexley and Sidcup asked me about UNESCO. We are following with close attention the work under the new Director-General Mr. Mayor. His attempts to achieve the necessary reforms have to be reviewed before we can reconsider our membership of UNESCO. I assure my right hon. Friend that we are following most closely and with great interest the steps that are being taken.
The right hon. Member for Gorton made a valuable analysis of the middle east, with hardly a word of which I would have disagreed. The hon. Member for Dundee, West (Mr. Ross) also spoke about the middle east, with considerable understanding, as did many hon. Members. It is important that the parties face up to the political reality. That means giving up outdated maximalist claims and recognising the need for mutal compromise—words that the hon. Member for Dundee, East used. We need an end to violence and to repression in the occupied territories. Israel needs to recognise that security will come not from the barrel of a gun but from peace with her neighbours. Time is on no one's side and as my right hon. and learned Friend the Foreign Secretary has often said, we shall not give up working towards the peace process. We shall explore all avenues of progress on what is clearly recognised as the best basis: "land for peace", an international conference and pursuing the United States initiative.
The hon. Member for Dundee, East asked a specific question about the PLO and its role in the peace process,
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and the hon. Member for Hamilton asked me about Mr. Sharrif's statement. I understand that the PLO has not yet endorsed that statement, but we shall be waiting to see what happens. As we watch the PLO policies and actions closely, we are encouraged by its recent moderate-sounding paper. We look for this to be confirmed not just in words but in deeds. Until then, the House will not expect Ministers to meet the PLO, and the PLO cannot expect to play a constructive role in the peace talks. We have to take every opportunity to bring about peace.
I shall now say a few words about the vexed subject of South Africa. The hon. Member for Hamilton was wrong about the discussions that we have had about the Sharpeville Six—I was present at the ones in Luxembourg. My right hon. Friend the Prime Minister said this afternoon that if the legal processes do not work in overturning the death sentences, an appeal for clemency will be made. We shall take every pragmatic and realistic step to try not only to bring about the release of Nelson Mandela and other political prisoners but to find a way to get the necessary dialogue, without the violence, that can bring about a non-racial, representative system of government.
I will have to reply to other points in the debate by letter. For example, the hon. Member for Hamilton raised a point about Mr. Butcher and I know that he saw my hon. Friend the Under-Secretary this morning.
Debates such as this show us, every time that we are lucky enough to have one, that the world is a complicated place. Our foreign policy has to advance British interests against a shifting pattern of events. It is no good hoping, as many seem to, that things will change to our advantage. They will not. We have to do our best to ensure that changes will go in a positive direction. That means sticking to the principles, forging the alliances, building up, year in and year out, a solid framework of relationships and creating a secure western Europe from which we can view with confidence any development in the EC, the middle east, southern Africa, between East and West, wherever we are working.
As the Toronto economic summit showed, the economic policies that we have espoused have become acknowledged as the right way forward in the world, and this decade of hard work has transformed the country and others' perceptions of us. For many years, the values that we upheld have also been on the defensive around the world. That is no longer the case. We have used our strength in Europe and the Western Alliance and we now need to use our strength to help the developing countries, to bring peace and reconciliation, the chances of freedom and justice and real democracy in other parts of the world which today, sadly, still lack it.
It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.
Mr. Dalyell: On a point of order, Mr. Deputy Speaker. This is not a complaint against anyone present, but it will have been noticed by the Chair that there were a number of Conservative Members who were not called and a number of others who, very unselfishly, truncated their speeches. I speak for a number of my hon. Friends who had wished to speak.
This is not a matter of complaint against anyone who participated, but perhaps the House will bear in mind some figures. For one of these rare debates, we had 319

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minutes. Of those, 125 minutes went to the Front Benches, 90 minutes to four Privy Councillors and 103 minutes to 10 rather unselfish Back Benchers.
This is the point of order. Will you, Mr. Deputy Speaker, draw to the attention of the Leader of the House and of Mr. Speaker and your colleagues the fact that these foreign affairs debates are far too rare and that they are sui generic in the sense that they are not normally on the party political agenda as such? Surely, for the honour of Parliament, they should be a little more frequent. I hope that those figures will be taken into consideration.
Mr. Deputy Speaker: I am sure that the hon. Gentleman will realise that certainly the latter part of his remarks were addressed more to the Leader of the House than to the Chair, but his earlier point gives me the opportunity to say that I am sure that hon. Members on both sides of the House who were not called in the debate—many of whom sat through most of it—will echo the hon. Gentleman's remarks. At present, the Chair has no power to limit the length of speeches. The remedy is in the hands of the House, if it wishes to exercise that remedy. There is, of course, a motion on the Order Paper in that regard at present.

Footwear and Textile Industries (Leicester)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Lennox-Boyd.]
10.2 pm
Mr. Keith Vaz: This is the first time that a debate has taken place in this House specifically on the subjects of the footwear and textile industries in Leicester. Those two industries are embellished in the history of the city. They are interwoven in its social fabric. I would like to pay tribute to the National Union of Hosiery and Knitwear Workers, its president David Lambett, the National Union of the Footwear, Leather and Allied Trades and its president Bob Stevenson, the British Textile Confederation, the Knitting Industries Federation and the British Footwear Manufacturers Federation and its new president, John Church. Both industries are blessed with good industrial relations and a unity of purpose of workers and management for prosperity and growth. I commend them all.
As early as 1520, of the 151 freemen admitted in Leicester, over one third gave their occupations as connected with the textile and leather industries. The hosiery industry was established in 1640. By the mid-18th century, the county of Leicestershire had become the chief centre for hosiery manufacture in England and the midlands remains its principal seat. The shirt trade began in Leicester in 1796, sock-making became extensive in 1810 and glove-making reached its zenith in 1845.
Today, the textile and clothing industries account for over 9 per cent. of total employment in manufacturing industry. They supply more than twice as many jobs as the motor vehicle and parts industry, and more than three times as many as the aerospace industry. They contribute an estimated £5,104 million to the national economy. That is the good news. The had news is that textile imports by volume increased by 18 per cent. and clothing imports by 27 per cent. in the first three months of the year. The deficit for the quarter increased to a staggering £939 million.
In the knitting industry, 34,000 jobs have been lost since 1979, with total employment reduced to around 80,000, from which must be deducted the 700 redundancies recently announced by Corah of Leicester. These redundancies have, in some measure, arisen off the back of productivity improvements, but by far the greatest number of them are attributable directly to the industry's continued over-exposure to unfair, low-cost competition. The east midlands accounts for about two thirds of the industry's current annual turnover of about £1,600 million, and well over half of the two thirds is to be found in the city and county of Leicester, where the industry accounts for over one in 10 jobs in manufacturing.
There are three issues that are of concern to the Leicester textile industry. First, serious problems are being caused to the industry by present exchange rate levels and the instability of sterling. The low value of the dollar, and the fact that many of the textile and knitwear exporting countries in the far east link their currencies to it, to a greater or lesser extent, mean that these countries have secured a major cost advantage in the British and other European markets. In the first quarter of this year, imports of pullovers from dollar-related countries have increased by 8 per cent., blouses by 43 per cent., dresses by 56 per

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cent., tracksuits by 31 per cent. and T-shirts by 31 per cent., even despite the restraints that exist under the multi-fibre arrangement.
Secondly, Turkey is a major problem for the textile industry in Leicester and elsewhere. Turkey's subsidies to its textile industry—assistance that is related to a company's investment, and which can amount to more than the total cost of the investment—and the fact that it can export duty-free to the EEC while it charges about 116 per cent. on our knitwear exports to Turkey, are particular grounds for justified complaint by the textile industry. Turkish garment exports to the United Kingdom increased by no less than 66 per cent., in terms of numbers of garments, in the first quarter of this year.
Thirdly, negotiations are due to take place shortly with China for renewal of the EEC's agreement with it under the MFA. China is now our second largest source of garment imports. It increased its sales in the United Kingdom in the first quarter of this year by 27 per cent. It is important that this dominant market position, and the fact that it has a state-controlled economy enabling it to price its exports at less than the economic rate, should be taken into account in the negotiations. Offering large-scale concessions to China would certainly result in major damage to the United Kingdom textile industry.
There is the issue also of the trade policy of the United States. The Textiles Bill, which is currently passing through Congress, would impose global quotas on all textiles and apparel imports into the United States for the next 10 years. It is vital that the Minister makes appropriate representations to the American Government to warn the President and Congress that if the Bill becomes law the Common Market will retaliate against United States trade interests because of the quotas.
I have referred to Corah, which is a Leicester firm. Despite its management problems, which were related to me by the chairman of the firm in a letter that he sent me last week, it appears that during a period of 12 months a total of 59 people were recruited by the knitwear division, even though there are grave financial difficulties. The 700 or so redundancies at Corah, including the closure of its knitwear department, are not a problem that is specific to Corah. There is a problem throughout the companies manufacturing knitwear. There is growing evidence of short-time working, and we know from recently published accounts from local Leicester companies and others that they are also experiencing problems in their knitwear departments. The publicised redundancies in Corah can only cause the industry more problems in recruiting skilled workers.
People, especially school-leavers, will not enter the industry to undertake training unless they see that the industry has a future. There is already an acknowledged shortage of skilled workers in the industry, especially sewing machinists. This is partly related to the image of the industry and to the failure of the industry to put resources into the training of skilled people.
Companies will now be considering investments in new machinery that will become productive in 1989 to 1992. Knitting machinery is becoming increasingly expensive, with a full set of knitting machines costing probably over £ million. Companies will undertake this level of investment only if they are assured that they can obtain a
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return on the capital that they are planning to invest. The MFA and its associated quotas will end in 1991. To ensure that companies start planning their investments now, they will need an assurance that the MFA or some other international agreement will be maintained when the current agreement expires. An assurance from the Minister this evening on the continuation of controls on the import of clothing and textile products is essential once the MFA has been concluded.
In the city of Leicester some 25,000 people rely for their livelihood on the prosperity and continued existence of the clothing and textile industry. It is for the future of those 25,000 people that I am seeking assurances from the Government. For women in Leicester, clothing and textiles is the biggest single employer and for about 20 per cent. of female school leavers the clothing and textile industry provides the first job.
The problems are not dissimilar in the footwear industry in Leicester. The first boot and shoe manufacturer was William Moore, at Ansty in 1863. By the 1920s and 1930s, Leicestershire remained the second largest footwear-producing region in Britain specialising in women's shoes, for which it remains the leading area. In 1924, Leicestershire produced a quarter of the total output of footwear in Britain. By 1939, Leicestershire supplied half the output of children's shoes, two fifths of women's shoes and one twentieth of men's shoes in Britain.
That pre-eminent position has been altered dramatically as a result of the huge number of imports from abroad. It is worth reminding the Minister that last year we exported £186 million-worth of shoes and imported £797 million. Import penetration was 62 per cent. of the market in terms of numbers and 52 per cent. in terms of value.
Four countries stand out as having dramatically increased their exports in Britain. We imported 27 million pairs of shoes from Taiwan; 17 million pairs from South Korea; 4·47 million pairs from Indonesia; and 2·87 million pairs from the Philippines. The high level of import penetration is causing massive problems to firms in Leicestershire.
I welcome the decision by the European Commission to investigate imports from Taiwan and Korea. That represents a major change in the Commission's approach which until now has handled footwear import complaints on a country-by-country basis. Several other Common market countries have also lodged complaints about Taiwan and Korea. The fact that the Commission is prepared to act collectively on the issue shows that it is concerned for the future of the footwear industry. I urge the Minister to monitor the position and ensure that the European Commission fulfils its task.
Another concern of the footwear industry relates to 1992 and the arrival of the single European market and the possibility of VAT being imposed on children's shoes. I remind the Minister of the findings of the Munro report, commissioned by the Chancellor of the Exchequer in 1972. It concluded:
"There is a strong connection between foot defects and ill-fitting shoes. Pressures on feet may pass unnoticed by children whose bones are not fully ossified, but may lead to serious problems, and even immobility in middle or old age."
The economic effect will be even more devastating. The report suggests that if VAT is imposed on children's shoes home production would decline by 3·6 million pairs.

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Although that would be offset by imports of 2·2 million pairs, there would be a net loss on the market of 1·4 million pairs. The report states:
"There would be a net loss of 1,500 jobs in manufacturing and 200 jobs among retailers … most of them small, independent businesses of the kind the government is most anxious to foster."
I seek the Minister's assurance tonight that he will not impose VAT on children's shoes before harmonisation or after it takes effect.
There is also the generalised scheme of preference. As the Minister is aware, under GSP rules a tariff ceiling is imposed on each of the beneficiaries. Once that level has been reached, full customs duties may be imposed at the request of a member state. The industry's view is that the figures currently being produced show that the Government should ask the Commission to restore duties on rubber and plastic footwear from Indonesia and Thailand, and on textile footwear coming from the Philippines. The crisis in the Common Market footwear industry is such that we cannot afford to let that opportunity go by.
It is impossible for me to pick up a Leicester newspaper without reading of some crisis in the local footwear industry. John Stone and Jeff Evans, who are correspondents for the local newspaper, have produced banner headlines such as "Worries over rise in shoe imports," "Probe into cheap shoes," "Huge rise in imports" and "China floods the shoe market". That last headline led into this extraordinary opening paragraph:
"Hot on the heels of the 21p a pair Chinese knickers revelations comes an avalanche of 53p a pair Chinese shoes being sold at up to £3 a pair in British shops."
Yesterday, I received the sad news that the Wallace shoemaking firm in Moores road, Belgrave, in the heart of my constituency, is to close, with the loss of 25 jobs. That is put down to the fact that imports have been rising.
It is not all had news. In Leicester, we take pride in the work done at Leicester polytechnic's school of design. It offers the only first degree and now higher degree courses of their kind in the country in shoe design. Last month, the polytechnic. with the help of Mr. John Irvin, a governor, who is chairman of Glovese Shoes, launched an appeal for a computer to help polytechnic students to design and manufacture shoes. The appeal is for just £30,000. If the Minister has brought the Government's cheque book with him tonight. I ask him to make a contribution to that worthy cause. I remind the Minister that the Government promised to assist the best practices task force, which was established to advise the industry. If the Minister has his cheque book with him, I hope that he will ensure that those funds are restored.
We all wear clothes and shoes. They are basic essentials without which we cannot survive, and the footwear and clothing industries cannot survive without the Government's support. That is why we want them to act. Rising imports, consequent British job losses, and the decline in morale are worthy of immediate and urgent action. Promises about the future will not save those industries. At two separate meetings with the Minister earlier this year, he asked for proof of damage. We have that proof and we urge him to act.
It is time that the Government backed British manufacturers and encouraged cities such as Leicester, which has historically produced some of the finest
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footwear and garments in the world. Those two Leicester industries are crying out for help. The Government and the Minister ignore their pleas at their peril.
10.17 pm
The Minister for Trade (Mr. Alan Clark): I have listened with great care to the speech of the hon. Member For Leicester, East (Mr. Vaz) and congratulate him on making a very full survey of two important industries and the problems they face. I would have preferred it had the hon. Gentleman been a little more generous in his reference to their achievements, which are by no means unremarkable.
Together, footwear and knitting provide about 29,000 jobs in the county and contribute in turn 17 per cent. and 22 per cent. respectively of national employment in those sectors. Footwear and textile firms have fought back hard since the recession of the 1970s and the early 1980s. I am very pleased to note improvements in productivity derived in many cases from the use of new technology.
The hon. Gentleman referred to a significant increase in import figures, but increases in exports, achieved in the face of ever-rising competition from low-cost and other overseas producers in export markets, have reached over the past 12 months 10 per cent. in footwear, 15 per cent. in knitwear, and 15 per cent. in clothing. Those industries deserve every congratulation on their achievement. The combination of increased imports and increased exports is largely a function of the general rise in prosperity throughout the United Kingdom.
I shall refer briefly to the widespread problem of skills shortages. Although I cannot make any immediate commitment in response to the question that the hon. Gentleman put to me relating to the Government's cheque book, I shall certainly consider his comment and write to him about it.
Training is primarily the responsibility of employers, who are best able to know their needs. However, the Government have given a lead by more than doubling expenditure on training since 1979. The Department of Trade and Industry is helping four colleges in the east midlands to update clothing and knitting equipment under the textile and clothing education equipment scheme. I am confident that improved experience for students and better courses for those already in industry will result.
Leicester firms are affected by the rise of imports into the United Kingdom, particularly in relation to ladies' fashion footwear and knitwear from the far east. As the hon. Gentleman said, we have discussed that matter on two previous occasions.
A surge in footwear imports is repeated in other EC countries. In response to separate approaches by the United Kingdom and other member states, the Commission has decided to carry out an investigation into footwear imports from Taiwan and South Korea. We have asked that the effect of Taiwanese imports on the ladies' fashion sector be particularly studied. As the hon. Gentleman knows, British footwear manufacturers are already substantially protected by a range of restraint measures against low-cost imports from state trading companies.
None the less, as the hon. Gentleman stated, despite the encouraging success of recent years, I recognise that the footwear, textile and clothing Industries in Leicester still face some real problems. Recent fashion trends appear to

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have led to a decline in demand for knitwear and some styles of footwear, and that is undoubtedly giving manufacturers in Leicester considerable problems.
The hon. Gentleman mentioned the strength of the dollar. It is true that some of the newly industrialised countries of south-east Asia have their currencies tied to the dollar, although the United States is as anxious to break that link as we are. As the hon. Gentleman knows, the dollar has appreciated over the past few weeks. However, that has led to increased imports of textiles and clothing.
Our bilateral textile trade agreements under the multi-fibre arrangement, which govern much of the trade, do not place tight quotas on all textile imports. Many quotas have been under-utilised in previous years and are only now being fully used. Therefore, the rate of increase may slow down this year. For other textile categories, restraint action can be taken against a supplier country only when a convincing case of disruption to United Kingdom industry due to those imports can be made. I made that point clearly when the hon. Gentleman came to see me.
I can assure the hon. Gentleman that I am ready to consider pressing Brussels for action on unrestrained textile imports within the rules of the MFA or associated arrangements when a clear case of injury can be demonstrated. There are perfectly plain set criteria for establishing that, and my officials are in consultation with the industry and will be glad to assist in preparation of the case.
There has been a great deal of concern in the textile industry recently about trade with Turkey. The hon. Gentleman made that point succinctly, and I recognise that that is a highly unsatisfactory area and one that requires attention.
Turkish exports of textiles and clothing are covered by separate informal voluntary restraint arrangements between the EC and the Turkish textile and clothing export associations. The restraint arrangement was renewed last autumn after difficult negotiations. As a result of our express concern about acrylic yarn imports,
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a new restraint level was included. That level was higher than we in the industry would have liked, but at the time of the negotiations we had insufficient evidence of serious disruption.
Success in an anti-dumping complaint depends not only on establishing dumping but on showing that the injury is directly attributable to imports from the country in question. In the case of Turkish acrylic yarn, this is not proving easy. Although Turkish imports rose significantly in 1987, overall import penetration fell from 55·4 per cent. to 49· per cent. and the latest import figures that I have show that Turkish imports of acrylic yarn are much reduced this year.
I want to refer briefly to the draft Textiles Bill which has gone through the House of Representatives but on which the Senate has yet to vote. Although there could be another presidential veto, the textile and footwear lobby in Congress might still have this proposal enacted if it could obtain the necessary two thirds majority in both the House and the Senate to override the veto.
The United Kingdom Government and the Community continue to urge the Administration to stand firm against the Bill, and we emphasise that the Community will retaliate in the general agreement on tariffs and trade if the Bill is enacted in its present form. I remain optimistic about the outcome here.
Finally, I want to make a general point about the return of textiles and clothing to normal GATT rules. It is one of the many issues under consideration in the Uruguay round, but progress will depend heavily on progress on the other issues, including the discussions on tariffs, non-tariff measures generally, subsidies, dumping, the balance of payments and infant industry provisions in GATT, the safeguard clause and protection of intellectual property rights. In other words, it will not be treated on its own but will be nurtured very carefully and subsumed into the whole spectrum of progress in the GATT talks. We would wish to ensure that no undue disruption of the United Kingdom market in textiles and clothing would result from a return of textiles and clothing to normal GATT rules.
Question put and agreed to.
Adjourned accordingly at twenty-six minutes past Ten o'clock.

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Preamble
The House met at three of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Blackburn.): The LORD CHANCELLOR on the Woolsack.
Lord Chancellor: Leave of Absence
The Lord Chancellor (Lord Mackay of Clashfern): My Lords, before the commencement of business, I take the opportunity to inform the House that I am to visit the judges and staff at the Crown Court at Chelmsford and Chelmsford County Court tomorrow, and that I have accepted an invitation to attend the Tynwald Ceremony on Tuesday, 5th July. Accordingly, I trust that the House will agree to grant me leave of absence for tomorrow and for Tuesday, 5th July.

Retirement Pensions: Uprating
Lord Stoddart of Swindon Lord Stoddart of Swindon asked Her Majesty's Government:
What is the present level of the state retirement pension for a single person and a married couple and what would be the level of those pensions had they continued to be related to the level of earnings as well as to the retail price index.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Skelmersdale): My Lords, at present, the basic retirement pension is £41·15 for a single person or £65·90 for a couple. These rates would have been £47·10 and £75·35 respectively had they been uprated in line with the rise in the general level of earnings between November 1978 and September 1987, the end of the review period for the most recent uprating.
Lord Stoddart of Swindon: My Lords, does the noble Lord not think it deplorable that pensioners should be treated in this way and that they are not to share in the much-vaunted increased standard of living? Is he aware that since 1980 when the system was changed a single pensioner has lost more than £1,500 in pension and a married couple no less than £2,400? I hope that the noble Lord, who is a decent man, will go back to his colleagues and advise them that this matter should be looked at seriously to ensure that pensioners catch up with the standard of living which they have lost over the last seven years.
Lord Skelmersdale: My Lords, it ill behoves a Member of your Lordships' House, or indeed of another place, speaking from the Opposition Benches, to use words such as "deplorable" about pensioners' incomes. It is the change in pensioners' total incomes which counts and not the rate of basic pension. The Government do not intend—indeed no government have ever intended—pensions to be the whole of pensioners' incomes. So far as pensioners' total incomes are concerned, between 1979 and 1985 they have risen on average by 2·7 per cent. a year. We should compare that with the period between 1974 and 1979 when they rose by only 0·6 per cent. a year.
Baroness Jeger: My Lords, does the Minister realise that 14 per cent. of all households (that is, 45 per cent. of all retired people) are excluded from the general index because they rely for at least three-quarters of their income on national insurance and social security? Does he recall that these pensioners have a separate price index which does not include housing at a time when housing costs for many people are increasing rapidly? Therefore is it fair that any increase in their pensions should be linked to the retail price index, which is connected to the expenditure of people who are still earning? Surely it is not fair to base it on that.
Lord Skelmersdale: My Lords, I do not think fairness comes into it—
Noble Lords: Oh!
Lord Skelmersdale: Today, my Lords, a couple with no other income will typically receive total state help of £90 a week through income support and housing benefit, including having all their rent paid where appropriate. The family expenditure survey shows that average weekly expenditure by pensioners is less than their weekly income. I believe that is what matters.
Lord Carter: My Lords, is the Minister aware that the change in the basis of the calculation of pensions is now worth some £4 billion a year to the Exchequer? Does he agree therefore that the whole of that £4 billion in tax cuts which is now entering the national pay packet is not a result of the success of the Government's policy but in fact comes straight out of the pockets of pensioners?
Lord Skelmersdale: No, my Lords, of course it does not. It comes out of the pockets of the taxpayers.
The Earl of Halsbury: My Lords, I query the logic of what we are talking about. Surely my pension should be linked to what I earned during my earning years, possibly indexed to the value of money which may have changed since then. I am not entitled to an increment in my pension because my grandchildren are now employed at a higher level of productivity than I was long ago.
Lord Skelmersdale: My Lords, the noble Earl is right to the extent that a retirement pension is a contributory benefit. There are other social security benefits which make the level up to the £90 a week to which I referred earlier. The state pension is one thing; the total income going into pensioner households is quite different, which is a fact that obviously the noble Earl has grasped.
Baroness Macleod of Borve: My Lords, my noble friend referred to single persons. Is he aware that a single mother bringing up a child has considerable help from the Government but that a widowed mother receives practically no help at all until she is of a much older age?
Lord Skelmersdale: My Lords, the social security changes have meant that the situation for widows has indeed changed, as the likelihood of their remarriage has changed. But, with respect, I suggest that that is

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a slightly different question to the Question on the Order Paper.
Lord Stoddart of Swindon: My Lords, the noble Lord challenged me about the record of the Labour Party. Is he aware that during the period of the last Labour Government pensions rose in real terms by 20 per cent.? Since this Government have been in office pensions have risen in real terms by 2·02 per cent. Therefore the record of the Labour Party is in fact exemplary. Does he agree that, since earnings have gone up by an average of 7½ per cent. and the Exchequer has been receiving the additional insurance contributions from those increases, they should have been passed straight on in improved living standards to pensioners? That is not being done. As I said, I believe that the noble Lord is a decent man, but I wish he would show some compassion for the old-age pensioners in our country.
Lord Skelmersdale: My Lords, I take it very hard that I am accused of not showing compassion. What I have done is to explain to the noble Lord and to the House generally that it is the total level of pensioners' incomes which matters. If he regards the record of the Labour Party as exemplary when during that period it poured money into the pockets of those who did not really need it, he is entitled to his view.

Arable Land: Set-Aside
3.10 p.m.
Lord Carter Lord Carter asked Her Majesty's Government:
What reduction in the acreage of arable crops they expect to result from their proposals for the "setting aside" of arable land.
The Parliamentary Under-Secretary of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington): My Lords, the Government have not taken a view on the reduction in acreage because this will depend on the level of response to the set-aside scheme.
Lord Carter: My Lords, I thank the Minister for that Answer. Is she aware that there is considerable disappointment among many environmentalists and farmers that the set-aside proposals do not include a grassland option, a so-called grazed fallow? Will she agree that the Government are to be congratulated in achieving what the Labour Party has wanted to achieve since it was formed; namely, bringing about the demise of the private landlord in British agriculture? It will now make no sense to re-let a farm which has become vacant on a secure lifetime tenancy rent of, say, £40 an acre when all the landlord has to do is to plant the whole farm with a cover crop and draw the set-aside compensation of £80 per acre.
Baroness Trumpington: My Lords, in answer to the noble Lord's supplementary question, there is a serious risk that the grazed fallow option could lead to adverse impact on existing livestock producers, particularly in the uplands. In addition, under the EC rules stocking densities are to be properly controlled and therefore substantial new bureaucratic resources would be required.
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I do not agree with the premise in the second part of the noble Lord's supplementary question because we cannot believe that the introduction of the scheme will significantly affect present landlord-tenant relationships which have existed for many centuries. The rate of aid is unlikely to encourage landlords to eject tenants from land or fail to renew tenancies. Participants, including landlords, will still incur the costs of managing set-aside land.
Lord Hooson: My Lords, in the light of the drought in the United States and the forecast of a grain shortage, are the Government revising that policy?
Baroness Trumpington: My Lords, that is another question, but the scheme stands regardless.
Lord John-Mackie: My Lords, I am sorry that the Government have not had an appreciation of the possible situation. Is the Minister aware that considerable discussions have been taking place, particularly with landlords, agents and general farmers? In respect of farms up to 150 acres it is almost worth taking the lot and taking a job. Up to 450 acres it is a difficult proposition because on 20 per cent. one cannot reduce by one man or one tractor so one is stuck there. That leaves the good land situation. I doubt whether it is very attractive to those on the good land from where the surpluses are coming.
Baroness Trumpington: My Lords, we see the scheme as a complement to stabilisers which are the main instrument of reform. The rates of aid are aimed at offering reasonable reimbursement for loss of income and the cost to farmers of managing land, while not overcompensating. However, rates are at the top of the scale set out in the consultation document which the noble Lord has no doubt seen. It is likely to be most attractive to cereal growers of marginal profitability or in economic difficulty.
Lord Kennet: My Lords, have the Government considered achieving a reduction in the cereal yield by achieving a reduction in the intensity of the application of fertilisers, thereby securing an environmental goal at the same time?
Baroness Trumpington: My Lords, that is another question which I shall be delighted to answer if the noble Lord tables it. However, today we are discussing set-aside.
Lord Peston: My Lords, will the noble Baroness explain to those of us who have difficulty in following the matter why we are subsidising farmers to produce more crops while at the same time we are subsidising them to produce fewer crops?
Baroness Trumpington: My Lords, we are certainly not paying farmers to do nothing. We shall be requiring farmers to manage the countryside and keep it in good agricultural condition and environmentally attractive. As regards stabilisers and set-aside, we are trying to lower the quantity grown of crops which are in surplus.
Lord Gallacher: My Lords, will not the noble Baroness agree that, in as much as the set-aside scheme allowed a substantial measure of the national

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determination of the details of the scheme, it is a matter of great disappointment to British farmers that the scheme which the Ministry is now offering is based substantially on Continental experience—in other words, that of small farms—and that in those circumstances it is unlikely to be taken up in substantial measure by British farmers, resulting in the use of the trigger mechanisms of the stabiliser scheme which we would all deplore?
Baroness Trumpington: My Lords, in other countries in the EC the farming conditions and the size of farms are very different. We can only try to do our best with the set-aside scheme, and time alone will tell how many farmers find it attractive.
Lord Stoddart of Swindon: My Lords, can the noble Baroness say whether the failure of the British Government to allow the option of the grassland scheme will put British farmers at a disadvantage because Continental countries are allowing their farmers that option?
Baroness Trumpington: My Lords, France and Germany are allowing it. Member states have the option of permitting low-intensity livestock grazing on fallow land. Stocking densities would be limited to either one livestock unit per hectare of grassland or no increase in the number of livestock units already on the holding. The rate of aid would be half that offered for green fallow.
In our view, green fallow, or non-grazed fallow, is preferable to grazed fallow for the reasons that I gave at the beginning. They are that it would be extremely difficult to police, and our sheep, dairy and beef farmers would be seriously disadvantaged if people increased the number of livestock by using the fallow in this way.
Lord John-Mackie: My Lords, will the noble Baroness explain to my noble friend sitting behind me that the bulk of the subsidies are not paid to farmers but for the restitution of prices and for storage? They do not go into the pockets of the farmers.

London Underground: Ticket Barriers
3.19 p.m.
Lord Boyd-Carpenter Lord Boyd-Carpenter asked Her Majesty's Government:
Whether they consider that London Transport's plans to introduce ticket-activated gates at all exits from London Transport Underground stations constitute a threat to the safety of passengers in the event of a fire or other serious accident; and whether they propose to take any action on this.
The Parliamentary Under-Secretary of State, Department of Transport (Lord Brabazon of Tara): My Lords, inspecting officers of railways representing my right honourable friend the Secretary of State for Transport have been consulted during the introduction of the ticket-activated gates on the London Underground. They consider that the arrangements for the opening of all gates simultaneously in the event of an emergency are satisfactory. Because there will be a wider overall
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opening in the barrier line with the new system compared with the old a better means of escape in an emergency will be provided. No action on the part of Her Majesty's Government is therefore required.
Lord Boyd-Carpenter: My Lords, I thank my noble friend for that Answer. Does he recall that on Monday, in reply to the noble Lord, Lord Kennet, he said at col. 1132 of the Official Report that there would always be someone in the ticket office able to operate the switches to open the gates? Is my noble friend aware that if he travelled frequently on the Underground he would find that at the moment that is not the case? Will he tell the House what will happen if a fire or other catastrophe took place during the usual situation of there being no one in the ticket office?
Lord Brabazon of Tara: My Lords, I believe that I said that there would always be available someone in the ticket office or in another place. I am assured that whenever a station containing the new ticket barriers is open to the public there will always be someone in charge who will hold the necessary keys to operate the emergency opening devices, even though the ticket office is closed.
Lord Strabolgi: My Lords, I support what the noble Lord, Lord Boyd-Carpenter, has said. Would it not be better if London Transport adopted the system used in the Paris Metro where it is necessary only to show the ticket on entering the system but not on leaving it?
Lord Brabazon of Tara: My Lords, I do not have comparisons with the Paris Metro but I understand that there are more staff per station in London than in Paris. It may be that a different ticket structure in Paris accounts for that.
Lord Jay: My Lords, will the Minister not take more seriously the warnings given by the noble Lord. Lord Boyd-Carpenter? Is he not aware that the combination of the present acute shortage of manpower on London Transport and the introduction of the barriers carries serious risks?
Lord Brabazon of Tara: My Lords, as I said in my original Answer the inspectorate of railways has looked into this matter and has decided that there is no risk. As I further said, there will always be somebody at the station who is able to operate the switches.
The Earl of Halsbury: My Lords, if that somebody has gone to answer a call of nature, is there a second somebody who is standing by to operate the switch.
Lord Brabazon of Tara: My Lords, as I said or Monday, there are three different places from where these switches can be operated. If there is only one person on duty in the station who has the key to the switch, I hope that in attending to his call of nature he does not take too long about it.
Lord Molloy: My Lords, is the Minister merely saying what he thinks London Transport means when it says that all these areas which control the

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ticket department can be activated at the throw of a switch and that there will always be someone there to do that? Has London Regional Transport officially said that? Has it also considered the point already made that to frustrate the cheats who obtain free and illegal transport there should be a study of the Metro system in Paris which seems to cope with all the major problems? It frustrates the cheaters while not imposing any danger on passengers.
Lord Brabazon of Tara: My Lords, in reply to the first part of the noble Lord's question, I am assured by London Regional Transport. That is from where my assurance comes. As to the second part, I do not have a comparison between the Metro system and the London Underground, but differences may apply.
Lord Orr-Ewing: My Lords, is my noble friend aware that in many cases going back over many years there has been no one collecting tickets and that even if there is someone he takes not the least bit of interest and is usually chatting to someone else at the time one goes through? Therefore, the present system is wasteful in manpower and totally ineffective. Is he aware of a new mechanical system installed in the modern metro of Washington whereby one's ticket, on being passed through the system, automatically has the number of stations through which one has travelled deducted from it. That is far more effective provided that we can have that overriding person in charge of the station at all times able to oversee a safety operation.
Lord Brabazon of Tara: My Lords, I am grateful to my noble friend. I believe that I gave the assurance he requires. The point is that tickets should be inspected either mechanically or by a person. If that cuts down on the amount of cheating it would be good for the London Underground.
Lord Wallace of Coslany: My Lords, is the Minister aware that already at Embankment station where a ticket-activated system is in operation there is far more congestion for those leaving the station than there has ever been and if there was a fire it would be even worse?
Lord Brabazon of Tara: My Lords, my understanding is that because there arc more exits available for people to go through than there were under the manually operated system, in an emergency there would be more ways out than there were before.
The Earl of Onslow: My Lords, perhaps I can help my noble friend on the Front Bench as regards Paris. Is he aware that in France all underground tickets cost the same so that if one goes for one journey it costs so much and for a longer journey it costs exactly the same? Therefore, one does not need entry and exit ticket checks.
Lord Brabazon of Tara: My Lords, I am grateful to my noble friend for that information. It perhaps assists me in answering earlier questions about comparisons with the Paris Metro system.
Lord Underhill: My Lords, does the Minister appreciate that his replies this afternoon are far more definite than those he gave on Monday both to myself and to the noble Lord, Lord Boyd-Carpenter? Can we be assured that in his discussions with the inspector of railways the point has been made absolutely clear'? What matters is not who it is believed will be on duty but that there will definitely be a trained person available at all times.
Lord Brabazon of Tara: My Lords, that is the assurance which I sought between Monday and today, and I hope I have been able to give that assurance.
Lord Boyd-Carpenter: My Lords, before the noble Lord allows this system with its inherent dangers to go through, will he at least discuss the matter with the London Fire Brigade?
Lord Brabazon of Tara: My Lords, first, I do not accept that there are inherent dangers in the present system. Secondly, the present system is already coming into force and is expected to be complete by the end of the year. Thirdly, the London Fire Brigade has seen the new barriers in operation. It made some comments which were taken up by London Underground and is now generally satisfied with the barriers and the release mechanisms.
Lord Leatherland: My Lords as we have had tributes from three noble Lords to the virtues of the Paris underground system, will the Government send a deputation to Paris to study the matter for a few months?
Lord Brabazon of Tara: My Lords, I cannot give the assurance for which I suspect the noble Lord asks; namely, that he might be included on such a delegation. However, if such a trip is planned, I shall certainly keep in mind the name of the noble Lord.
Lord Hughes: My Lords, I do not know what would be the opinion of the Chancellor of the Exchequer. The French Government subsidise the Paris Metro to the extent of £600 million per year.
Lord Brabazon of Tara: My Lords, in that case, I believe that representatives from the Paris Metro would be well advised to come here to see our system, which costs the taxpayer a great deal less money.
Lord Teviot: My Lords, is my noble friend aware that I am not sure that London Regional Transport needs all this advice from overseas or even from any other EC country? It is doing extremely well. On the ticketing system mentioned by my noble friend Lord Onslow, there is a one-zone system. I agree with the noble Lord, Lord Molloy. It could increase its market. Of course, the Question of my noble friend is entirely in order. Equally, one has to follow the fare dodger so that income is not lost. London Regional Transport is extremely responsible and efficient.
Lord Brabazon of Tara: My Lords, I endorse the remarks made by my noble friend in the last part of his question.
Lord De Freyne: My Lords, over the last three years London Underground has reduced its staff by x number—I do not know what it is. Can the Minister give the figure, say why that is, and what is happening now?
Lord Brabazon of Tara: My Lords, we are straying rather far from the Question, which is about automatic ticket-activated gates. However, I remind my noble friend that London Regional Transport is not an employment agency. Its job is to provide an efficient railway system.

Magisterial Service: Staff Shortages
3.27 p.m.
Lord Mishcon Lord Mishcon asked Her Majesty's Government:
What steps are being taken to remedy the shortages of staff in the magisterial service, particularly in the London area.
The Minister of State, Home Office (Earl Ferrers): My Lords, while there is no shortage of justices' clerks, the Government are concerned that there is a shortage of court clerks. We hope that the outcome of the current pay review may help to attract candidates into the magisterial service.
Lord Mishcon: My Lords, I am glad that the House has been informed that there is a very critical situation in relation to court clerks generally in the magisterial service. Is the noble Earl aware that there is not only a shortage in establishment but there is some sort of deficiency in quality in the new recruitment? Is this not due to competitive salary offers both in the legal profession and in the Crown Prosecution Service? In those circumstances, does he agree that it is a very critical matter and that the whole question of terms and conditions of service of these people must be looked at if the situation is to be remedied?
Earl Ferrers: My Lords, I agree with the noble Lord. There is a shortage here which we would wish not to see. I understand that the joint negotiating committee which negotiates pay and conditions for magistrates' court staff is collecting information on recruitment and retention and will take this into account when considering the pay settlement which at the moment is being discussed. However, the noble Lord is correct that there are competitive forces at work.
Lord Tordoff: My Lords, will the noble Earl not agree that the high quality of magistrates' clerks is vitally important to the administration of justice in our magistrates' courts? Indeed, with a lay magistracy it is frightfully important that the clerks are of the highest possible quality. If they have to be paid to be of that quality, surely we must take steps towards that end.
Earl Ferrers: My Lords, I agree with the noble Lord, Lord Tordoff. It is perfectly true that the high quality of staff is essential. That will be taken into account.
Lord Mottistone: My Lords, does not my noble friend agree that the problem raised by the noble Lord, Lord Mishcon, applies not only to London but all over the country and to the country areas?
Earl Ferrers: My Lords, I believe the position is worse in London.
Lord Bottomley: My Lords, can the Minister tell the House why three admirable candidates, two of whom were nominated by myself over 12 months ago, have not been considered for membership of the magistrates' bench? In what way are magistrates appointed, and are candidates told in due course why they have not been selected?
Earl Ferrers: My Lords, I am afraid that I am completely unable to answer that question. If the noble Lord will write to me I shall endeavour to ascertain what has happened.
Baroness Robson of Kiddington: My Lords, is the noble Earl aware that, as mentioned, the shortage of magisterial clerks does not exist only in London and that there is increasing pressure on magisterial courts to amalgamate in the counties of this country, resulting in defendants having to travel enormous distances to attend court in a climate where the rural transport services are diminishing?
Earl Ferrers: My Lords, I realise that there are difficulties in that respect and obviously we are addressing our minds to ensure that those difficulties are as slender as possible. I should inform the House that the number of staff who are being trained as court clerks has increased recently from 64 to 140 a year, so more people are being trained.
Lord Graham of Edmonton: My Lords, is the Minister aware that one of the aggravations in London courts is the great delay in presenting prisoners at the commencement of the day? When he considers how to improve efficiency and the quality of running courts in London, will he seek to ensure that prison officers, the police, magistrates and others work more closely together to ensure that the courts start their day efficiently?
Earl Ferrers: My Lords, that is slightly wide of the Question on the Order Paper, but I am sure that it will be considered.

Business
Lord Denham: My Lords, at a convenient moment after 3.30 this afternoon my noble friend the Leader of the House will, with the leave of the House, repeat a Statement that is to be made in another place on the European Council in Hanover.
It may be for the convenience of the House if I announce that the Report stage of the Local Government Finance Bill will be adjourned at approximately 7 p.m. for approximately one hour and that during this adjournment the British Waterways Board (Rateable Values) (Scotland) Amendment Order 1988 and the Docks and Harbours (Rateable Values) (Scotland) Amendment Order 1988 will be taken.

Local Government Finance Bill
3.33 p.m.
The Minister of State, Department of the Environment (The Earl of Caithness): My Lords, I beg to move that the Bill be now further considered on Report.
Moved, That the Bill be further considered on Report.—(The Earl of Caithness.)
On Question, Motion agreed to.
Clause 12 [Personal community charge]:
[Amendment No. 47 had been withdrawn from the Marshalled List.]
Lord Elwyn-Jones Lord Elwyn-Jones moved Amendment No. 48:
Page 8, line 44, at end insert ("and any arrears shall be recoverable as an ordinary contract debt in the appropriate court, in accordance with Schedule 4 below").
The noble and learned Lord said: My Lords, it may be for the convenience of the House if I advise that, with Amendment No. 48, Amendments Nos. 85, 86, 90, 91, 97 and 101 are grouped to be discussed together.
Your Lordships will see that in addition to my name and that of the noble Lord, Lord Harris of Greenwich, there is also included among the proposers the name of my noble and learned friend Lord Wilberforce, who has asked me to express his regret that, owing to other public duties elsewhere today, he is unable to be present.
The amendments propose in substance to remove from the Bill the provision of imprisonment for default in payment of the community charge. The amendments are supported by the National Association of Citizens' Advice Bureaux and the National Association for the Care and Resettlement of Offenders. Both organisations have great experience in this field.
The Bill at present provides that where arrears in the payment of personal community charges arise, the authority concerned may apply to a magistrates' court for a liability order against the person by whom the sum is payable. This carries with it the power of the magistrates' court by virtue of the provision of Schedule 4, paragraph 7(1), to commit the debtor to prison for a term of up to three months unless the amount stated in the warrant of committal against the debtor is paid before the end of the term of imprisonment.
In my submission, in view of the substantial ending of imprisonment for debt the proposal in the Bill to imprison defaulters for non-payment of the community charge is an anachronism and, in the circumstances, both inhuman and grossly inefficient. As the noble and learned Lord, Lord Wilberforce, said in Committee, in these days imprisonment for any form of civil debt is simply totally unacceptable. It was abolished in the Adminstration of Justice Act 1970, but contrary to the recommendations of the Payne Committee the possibility of imprisonment for non-payment of rates was retained. As a result of that decision, and that being part of our law, last year in England and Wales 370 people were imprisoned for not paying their rates.
When the community charge replaces the rating system it will apply to many people who are not now ratepayers but who will then be liable and will add greatly to the numbers at risk of imprisonment if the provisions of the Bill become law. In addition, it must be emphasised that some of the poorest ratepayers will face larger bills than they meet at present and they will be in greater danger of default. Indeed, the sanction of imprisonment, if it is applied, will fall almost entirely on the poorest members of our society. I feel sure that none of us will readily accept that appalling fact. The rest will have goods which can be sold.
If the Bill is carried, the number of people liable to imprisonment may well multiply fourfold and the 370 people now held in prison or police cells will rise to about 1,200. That is the estimate made by my noble and learned friend Lord Wilberforce.
Your Lordships may well ask how the Government, knowing the appalling pressure upon prisons and police cells by reason of the excessive numbers held in custody, can now contemplate aggravating the position in the way that the provisions of this Bill will do. The conditions in our prisons are a national disgrace. That has been accepted on all sides of the House as an almost unchallengable proposition, but here we have a measure which will aggravate the position.
Has the Home Secretary been consulted about this? He has expressed anxiety about the prison numbers and prison overcrowding. Has this possible effect on the prison population been brought to his attention? I hope we may be told.
What is striking is that, very wisely, there is no provision for the proposed power of imprisonment in respect of arrears of payment in the Scottish Bill. Imprisonment for debt was finally abolished in Scotland by the Debtors (Scotland) Act 1987. It is also striking that when the Bill we are discussing was originally introduced in another place there was no provision for commitment to prison for non-payment of the community charge. There was simply a short paragraph of about four lines providing for distress and attachment of earnings. That was the position when the Bill reached Second Reading in another place and also when it went into Committee. Suddenly there appeared at Report stage what I call these appalling provisions contained in the enormous Schedule IV, which includes provision for imprisonment. Why was the change made at that time and what had happened in the meantime to turn sense into nonsense?
Already the county courts, to which cases of arrears of payment of the community charge should go, have an adequate set of recovery measures in their procedures. The county courts have expertise in handling debt cases with the intention of resolving the problem for all concerned. They include, as we have suggested by Amendment No. 101, a garnishee order, which means that the bank account of the debtor can be frozen, or alternatively and for example, an administration order which can provide for other debts to be taken into consideration so that the debtor makes one payment into court from which all creditors are paid pro rata. Those provisions

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already exist in law to take some of the menace and poison out of the proposed alternative of imprisonment.
I face without fear the fact that the Bill provides that the defaulter may only be imprisoned if his failure to pay the charge was due to his wilful refusal or culpable neglect. As the noble and learned Lord, Lord Wilberforce, put it, that is a very variable concept. Magistrates vary in the standards they apply. The noble and learned Lord asked pointedly who in this Chamber has not been guilty from time to time of perhaps culpable neglect in not paying his bills.
It is also important to consider the cost and trouble of administering the imprisonment procedure. It is now calculated that the cost of holding someone in prison is about £250 a week. The average annual amount of the community charge will be about £230 a year. It is not a very economic proposition that we face in this Bill. It would be much more costly to send the defaulter to prison than to remit the amount of the charge. A prison sentence will add to the burden of the community charge upon the community.
I return to the question that if imprisonment for this debt is not required for Scotland, why is it required for England and Wales? What special offence have they caused to be singled out (or "doubled out" if that is the right way of putting it) for this abomination? This proposal in the Bill makes no sense in economic terms; in social and moral terms it is an abomination. I beg to move.
3.45 p.m.
Lord Harris of Greenwich: My Lords, I believe that the noble and learned Lord, Lord Elwyn-Jones, made an extremely powerful speech and it is not necessary for me to go into further detail as to why an amendment of this kind is clearly necessary. He asked a series of questions to which we require the most clear answers from the noble Earl.
The first point that the noble and learned Lord raised was why there are to be different procedures for Scotland as distinct from England and Wales. Why? He also made the point that some of the people who will find themselves facing substantial community charges, as the noble Earl will be aware, are among the most underprivileged of our fellow citizens. In such circumstances is it really sensible to bring in a requirement that if they default they should go to prison? Before the noble Earl undertook his present responsibilities he was in charge of the prison department of the Home Office. Therefore, he will be well aware of the gross overcrowding in the prison system.
The idea seems quite astonishing that we are cheerfully contemplating moving to a situation where a new category of person will be pushed into the prison system. The noble Earl will be aware that overcrowding in the system of England and Wales is now so severe that every night hundreds of people are kept in police cells in all parts of England and Wales. Metropolitan Police prisoners are set as far away as South Yorkshire because it is impossible to put them in remand accommodation in the South of England.
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That is also the situation in other parts of the country.
The costs are exceptionally high. The noble and learned Lord referred to the cost of keeping a prisoner in prison department accommodation. He said that it was well over £200 a week. It is costing the Government over £200 a night at the moment to keep people in police cells in greater London. Unless this Bill is amended it will create a situation where still more people will find themselves pushed into grossly overcrowded prison accommodation and also into police cells. Police cells are now being used not only for remand prisoners, but many of them are spending the whole of their sentence in police cells. In the light of this it seems astonishing that the Government are contemplating a change of this kind.
My final question is this. Why was this matter not put on the face of the Bill? Those of us who have been Ministers know perfectly well that before legislation is presented to Parliament there are prolonged discussions between government departments. Therefore, there would have been discussions among the Department of the Environment, the Home Office and many other departments concerning many features of this legislation. Therefore, why was there this change in the position of the Government?—because change there most clearly was. I believe we are entitled to ask the noble Earl why the Government changed their position.
Finally, perhaps I may return to the question of the burden that this measure will impose on our system of criminal justice if the Bill is not amended. Every night, as I have indicated, hundreds of prisoners are being kept in police cells and many hundreds of police officers are being taken off the streets in order to act as prison officers. That being so, how can it be right to push into the system yet another possibly major category of offender? The Metropolitan Police force has indicated that the burden upon it is growing at a most alarming rate. In fact, the manpower demands on the Metropolitan Police are greater than they were at Wapping. That being so, how can the Government possibly justify their position? I very much hope that the noble Earl will give us some detailed answers to that question, because otherwise I feel that many who are involved in the administration of our criminal justice system really will believe that the Government have lost their senses.
Baroness Faithfull: My Lords, on 23rd May I was one of the people who spoke about people's inability to pay and I forecast that our prison population would be increased. I wonder whether I too may ask my noble friend the Minister three questions. The first is the same as that posed by the noble and learned Lord, Lord Elwyn-Jones, and the noble Lord, Lord Harris: has the Home Secretary been consulted? Those of us who work in the penal system have it enjoined upon us day by day to keep people out of prison and to find alternative means of dealing with the situation. I am not saying that we should excuse people for not paying their dues; but I am saying that this is not the way to deal with those who do not pay.

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Secondly, has my noble friend the Minister consulted the Department of Health and Social Security? In this country we have one in three marriages breaking down. We have an enormous number of single parent families. I forecast that many of those who will not pay their community charge will be single parent families. If the parent is taken into prison then the children must be taken into care. This is a devastating thing for the children and it is very costly for the country. Further, it is quite out of line with the policy of our country, a policy which has been laid down for all social workers to carry out; namely, to keep the children with their families.
Thirdly, I think we all agree—of course we must—that people must pay their dues. However, if they do not do so, what will be the system of collection? We know that in the country there is £20 million owing in rent arrears. I profoundly believe that if we had an efficient system in our housing departments, we need not have that £20 million owing. Will there he an efficient system for collection of the community charge, and will there be a quick follow-up?
I speak with feeling on the matter because for some part of my life I was responsible for collecting rent arrears. It is possible for the poorest families, if quick action is taken and immediate visits are made, not to get into debt. They can be helped to pay their dues. I press my noble friend the Minister to answer those three questions.
Lord Campbell of Alloway: My Lords, I should like to ask my noble friend the Minister one short question. Would not a community service order be appropriate and wholly adequate to cover the situation? I have read the debate which took place at an earlier stage of the Bill's proceedings on the subject, especially the contributions made by the noble and learned Lords, Lord Wilberforce and Lord Elwyn-Jones. Surely a community service order would be an adequate and appropriate deterrent for the offence.
Baroness Macleod of Borve: My Lords, I am afraid that on this occasion I am unable to agree with my noble friend about the community service order, because, after all, that will cost money. What we are trying to get is money from the people who owe it. In 30 years of trying to administer justice in the courts—including cases involving debtors—as humanely as I can, I have always found that the possibility of being sent to prison is a great deterrent. For example, if I said to a person, "You will go to prison for five, six or seven days", the money was always forthcoming. When I say "always" I mean perhaps not 100 per cent. but at least 95 per cent. If, on the other hand, someone I knew had trouble in paying I would say to that person, "You will serve one day". They would then be placed in a cell in the police station until the court rose on that day. That of course means that the debt is wiped out. But, as the noble Lord said—and as pointed out by the noble Baroness, Lady Faithfull—there will be people who will be in difficulties in paying the charge. Nevertheless, so far as I can make out from the Bill, they will be able to ask for a rebate. That provision certainly applies to
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one-parent families. I am sure that there will be no possibility of such people ever going to prison.
I still feel—indeed, I always have—that prison is a deterrent and I should like to keep it in the Bill. I was interested to hear the noble and learned Lord say that 370 people were sent to prison because of failure to pay their rates. That is a very small number compared to the number of people who appear before the courts at this time for not paying their rates. I should think that there are at least six cases a week in my court of people who refuse to pay their rates for all kinds of reasons; but very rarely because they cannot afford to do so. As I say, if I sent such people down for seven days, there was always someone at the back of the court who could pay. I do not think that we can lose this provision as a deterrent.
Lord Henderson of Brompton: My Lords, I should like to congratulate the noble and learned Lord, Lord Elwyn-Jones, for bringing the amendment forward and also for the manner in which he has done so. I believe it to be a most important consideration, especially as it is not provided for in the Scottish legislation and was not provided for in the English legislation when it was first introduced. I agree with the noble Lord, Lord Harris, that it is important for us to know why there was this change of mind by the Government while the Bill was going through Parliament.
I have three points to make. The first concerns the under-privileged, who will constitute the greatest number of those who will be imprisoned under the provisions. There is not doubt about that. Indeed, that has already been referred to by the noble Lord, Lord Harris, and by the noble Baroness, Lady Faithfull. It must be borne in mind, as the noble Baroness, Lady Faithfull, said, that many of them are most likely to be single parents. This will mean the children being taken into care and will involve extra cost, which must be taken into account.
I know that the noble Baroness, Lady Faithfull, said that we all want the charge to be collected and I am also very much of that opinion; I do not want defaulters. However, I think that the very poor must be helped to pay. I should like to know whether there are schemes for easy payment, not merely by the month but by the week. Perhaps my noble friend the Minister can give me some assurance on that. Further, as the noble Baroness, Lady Faithfull, asked, I should like to know whether there will be a quick and efficient follow-up service so that people do not get too heavily into debt after three weeks, for example, instead of just one month's overdue payment.
The cost of all this will be considerable. As the noble and learned Lord, Lord Elwyn-Jones, said, the cost of keeping a man or a woman in prison is something like £250 a week, which amounts to something like £13,000 a year. I am sorry; I think that that calculation was in fact made by the noble and learned Lord, Lord Wilberforce.
The noble and learned Lord, Lord Elwyn-Jones, said that the number of those who will be attached and imprisoned for default under the Bill will be four times greater than at present. My mathematical ability is not great, but I am told by the noble and

1717
learned Lord that there are some 370 people now in prison. However, four times that figure does not make 1,200 to me; it makes 1,480, or very nearly 1,500. If you multiply that figure by £13,000 a year you get £19·25 million, or very nearly £20 million a year, which will be the cost of imprisoning such people. That is a very considerable amount and ought to be taken into consideration. The noble Earl, Lord Caithness, is shaking his head and will no doubt tell me where my maths have gone wrong.
As we were reminded by the noble Lord, Lord Harris, the noble Earl was until recently Minister of State at the Home Office and responsible for prisons. He will know about the crisis in the prisons. He will also know that Home Office policy is to keep people out of prison. We have been given many trailers for a Green Paper or White Paper which is expected next month. The whole object of this Green Paper or White Paper, or White Paper with green print, is to substitute non-custodial sentences for custodial sentences in the case of criminal offences. If that is the policy of the Home Office for criminal offences, surely it cannot agree with the proposals in the Bill for imprisonment for civil offences.
It is an outrage to go straight against the Home Office policy in a Bill of this Session which it can hardly have agreed without a certain amount of arm twisting. I should very much like to know how the proposal in the Bill can be reconciled with current Home Office policy which is soon to be stepped up, if anything, in the White Paper next month to which we are very much looking forward.
Lord Beloff: My Lords, before deciding how to vote on this amendment I should be grateful for some clarification. It has been suggested by certain proponents of the amendment that what we are dealing with is various categories of poor people who are unable to pay. None of us would wish to see a penalty exacted from the kind of people about whom the noble Baroness, Lady Faithfull, has been talking.
However, what the Bill says in the schedule is that the possibility of such a penalty is confined to people who either wilfully refuse to pay or are guilty of culpable neglect. Someone who wilfully refuses to pay or is guilty of culpable neglect must by definition be someone who has the resources to pay. It may be that one of the reasons why this provision was not in the Scottish Bill was the subsequent campaign to persuade people in Scotland not to pay, not because they could not afford to but because they thought the levy an unjust one. We need to know how seriously we must take the limitation to those who wilfully refuse to pay or are culpably neglectful, if these two matters can be distinguished. The argument for the amendment very much rests upon that.
Lord Morton of Shuna: My Lords, perhaps I may deal with the Scottish position on wilful refusal to pay. There is no argument to say that the provision was put in because in Scotland certain areas of the political spectrum put forward the idea of not paying. If that were the reason for putting in the provision, I am sure that the noble Earl would have included it in Schedule 15, which amends the Scottish Act. Even with the threat in Scotland of wilful refusal to pay,
1718
the Government have not put forward any such position. My understanding is that the courts in England tend to take a variable view about wilful refusal or culpable neglect, and it depends on one court's view on a person's amount of money and whether that amounts to a wilful refusal or neglect.
Lord Renton: My Lords, at the Committee stage my noble friend Lord Caithness introduced some fairly lengthy amendments on Scottish law which are now to be found in Schedule 15. He explained to us that many of the amendments were intended to achieve harmonisation between the laws north and south of the Border. I find it a little surprising that we should have on this matter not harmonisation but something quite in conflict.
My noble friend Lord Beloff said we were not dealing entirely with poor people but with people who might be able to pay. The attachment of earnings order system has been in operation in this country since 1958–30 years—and has worked surprisingly well.
Strangely enough, I had something to do with its introduction. I was not completely hopeful about it at the time of its introduction but it has worked well. An attachment of earnings would deal with those people who can afford to pay and would deal with them without sending them to prison. Having said that, I find this a difficult matter.
Arguments have been put on both sides. Owing to our procedure at Report stage one cannot wait until the Minister has spoken and then make a further speech oneself comparing the two points of view and attempting to assist the House by saying on which side of the fence one comes down. Therefore, having said what I have, I am trying to keep an open mind on the subject for the moment. My noble friend must bear in mind the strong arguments which have been made and I look forward to hearing what he has to say.
The Earl of Perth: My Lords, I have been listening to the debate and I am extremely worried that we shall create a new crime which sends people to prison. I am also worried because if the Bill passes in its present form for England and Wales, we may find the same thing being attempted—going backwards—for Scotland. I would be very unhappy about that.
I have listened to all the arguments. I listened to the point made by the noble Baroness, Lady Macleod, about a serious deterrent, and to the point made by the noble Lord, Lord Beloff. Nonetheless, on balance, the unease of the noble Baroness, Lady Faithfull, and the noble Lord, Lord Campbell of Alloway, and their proposal for something less than the drastic prison sentence appeals to me very much.
The Earl of Caithness: My Lords, perhaps I may deal first with the point made by my noble friend Lord Beloff. He was right to say that no one who is unable to pay will be imprisoned. One can be imprisoned only if one shows wilful refusal or culpable neglect. It is clearly established in case law that this expression only applies to someone who had the money, could have paid but either chose not to or failed to do so without reasonable excuse. That is the

1719
ultimate deterrent. That is the sending to prison. However, these amendments have nothing to do with sending people to prison. That is what was debated in Committee and your Lordships voted against the amendment then. The amendments in this group aim to move the recovery procedure for the community charge out of the magistrates' court and into the county court; and therefore I could not follow half of what was being said because noble Lords were talking about amendments which were discussed and voted on in Committee and not the amendments in front of the House this afternoon.
Perhaps I may deal with the amendments which are before your Lordships this afternoon. Amendment No. 48 is rather different from the rest in that it would delete all the carefully worked out recovery options in Schedule 4, many of which have been established for many years in the context of the rating system, and leave the community charge to be recovered as an ordinary civil debt. My noble friend Lord Glenarthur explained at an earlier stage what would happen if a charging authority had to pursue arrears through the county court. It would have to claim before the court that the person concerned owed the money and had not paid. If the court agreed, it would order that person to pay the arrears. If he still refused to pay the court could order a bailiff to sieze the person's goods or attach his earnings. Although this sounds comparable to the recovery procedure set out in Schedule 4, I am advised that in practice civil debts are notoriously difficult to recover through the county court. That contrasts with the recovery of rates through the magistrates' courts which over the years has proved extremely effective.
I would say to the noble Earl, Lord Perth, that we are not introducing anything new. What I have just said has indicated that there has been a final solution for the courts—if "solution" is the right word—for the recovery of rates, and for the person to be sent to prison if that does not succeed. All we are doing is transferring the existing power under the rate Acts to the community charge under this Bill. There is no new proposal in front of your Lordships.
A further and perhaps even more important reason for opposing Amendment No. 48 is that the detailed recovery procedures contained in Schedule 4, which the amendment would sweep away, are designed to provide safeguards for debtors as well as give charging authorities effective means of recovery. For example, we are providing for appeals to the magistrates' courts by anyone who feels aggrieved by distress or attachment of earnings. We shall he debating those matters shortly.
No such specific provisions exist for the county courts. Amendments Nos. 85, 86, 90, 91 and 97 would have a different effect. As with Amendment No. 48, they seek to involve the county courts rather than the magistrates' court; but they envisage retaining the detailed recovery procedures and mechanisms spelt out in Schedule 4. I fear that that approach does not have a great deal more to commend it than the approach of Amendment No. 48. It at least retains the important provisions of Schedule 4. It is misconceived because it would sweep away at a
1720
stroke the expertise and experience in rate recovery which the magistrates' courts have built up over the years.
Rate recovery has been undertaken by magistrates' courts for many years and has operated successfully and efficiently. The detailed enforcement provisions in Schedule 4 have therefore been devised in the light of experience in the magistrates' courts. It would be an expensive, bureaucratic and inefficient step to involve a new court and merely to throw out of the window everything that has been built up over the years in the magistrates' courts.
Amendment No. 101 seeks to add to Amendments Nos. 85, 86, 90, 91 and 97 by giving county courts the power to attach the bank accounts of community charge defaulters and to issue administration orders in cases where the defaulter cannot immediately pay the whole of the debt. Those are interesting options which are worth discussion, but I must ask your Lordships to accept that it is not possible to switch recovery procedures from one court to another and to throw in additional recovery methods at the drop of a hat.
That brings me back to a point my noble friend Lord Glenarthur made in Committee and which was raised by some of your Lordships today, in particular, the noble and learned Lord, Lord Elwyn-Jones, and the noble Lord, Lord Harris of Greenwich. It relates to the difference between Scotland and England and Wales. In Scotland, the current range of debt recovery options and procedures followed a Scottish Law Commission report published in 1985. That was the culmination of work stretching back over 15 years. In turn, that work was only made possible because much of what was done was the consolidation of the law and of legal procedures that they had developed over more than 100 years. I ask your Lordships to contrast that situation, which has taken 15 years, with some amendments to the Bill. One should wait for something similar in England, as my noble friend Lord Glenarthur said at an earlier stage.
4.15 p.m.
Lord Morton of Shuna: My Lords, the Scottish position was not concerned with recovery of rates or a tax. It was concerned with the whole business of civil debt. There is no need in the Bill and with these amendments to review the whole business of the recovery of civil debt in England. As I understand the amendment—I am only a Scottish lawyer—all that is being done is to take one procedure which applies to rates and put it into the general procedure which applies to the recovery of all other civil debts.
The Earl of Caithness: My Lords, the noble Lord has come up with a marvellously simplistic solution, but I am advised that it is not as simple as he would have your Lordships believe. The reason the Scots were able to do what they did was entirely due to the fact that the whole procedure had been looked at on a wide front.
The point, as I am sure the noble and learned Lord, Lord Elwyn-Jones, will recognise, is that one cannot invent a new recovery system overnight. The noble

1721
and learned Lord may argue, for example, that the garnishee order is a power available at present to the county court; but it is little used. To switch all the community charge cases to the county court and to expect the county court to be able to cope with the extra burden, with or without the power to issue garnishee orders, is an unrealistic proposal which would lead to chaos.
It became clear during the course of the debate that the purpose of the amendments is not merely to argue for the substitution of one court as opposed to another; it is to reopen a question which, as I said earlier, was debated at considerable length—whether there should be commitment to prison for nonpayment of the community charge. I know that the issue is important. It is of considerable concern to your Lordships, as was exemplified this afternoon. It is an issue which the Government take seriously, but it is also an issue which was fully debated in Committee.
My noble friend Lord Glenarthur explained in great detail that we believe it is essential at present to retain a power of commitment. That power is not widely used at present. Fewer than 400 people were committed for non-payment of rates in 1986. Contrary to what the noble and learned Lord, Lord Elwyn-Jones, feels, we are confident that there will be considerably fewer cases after 1990 because of the new arrangements for instalments, reminders, attachment of earnings and direct deductions from benefit. Commitment will be a rarely used but nevertheless important back-up power.
Lord Harris of Greenwich: My Lords, one can pay rates by instalment at the moment. That is no answer.
The Earl of Caithness: My Lords, I know that the noble Lord has been following the details of our proceedings with great care. He will be aware that new instalment procedures are being introduced in the Bill which have not been applicable to rates.
Many of your Lordships were present during the debate in Committee. Those of your Lordships who were not will have had an opportunity to study what was then said. The result was that after the fullest debate the Committee accepted the Government's case for retaining commitment, at least for the immediate future, as an essential reserve power. I am sure that all your Lordships will respect the will of the Committee as clearly expressed.
If your Lordships will permit me to delay you a little longer, I shall answer some of the points raised this afternoon. The most important point, raised by the noble and learned Lord, Lord Elwyn-Jones, the noble Lord, Lord Harris of Greenwich, and my noble friend Lady Faithfull, was whether we had had consultation with the Home Office. I can assure your Lordships that my right honourable friend the Home Secretary has been consulted and is content that enforcement should take place in the magistrates' court, which is the subject of these amendments, and that commitment to prison should be retained in the few cases where it is necessary. What is more, my noble and learned friend the Lord Chancellor is also fully content, and agrees that the magistrates' courts
1722
are the right place for these matters and that commitment should be retained.
I must say to the noble and learned Lord, Lord Elwyn-Jones, and the noble Lord, Lord Harris of Greenwich, that these amendments do not delete the committal provision, as some of your Lordships claim. That is a point I should like to make clear to your Lordships. My noble friend Lady Faithfull was concerned that families might be broken up if those on low incomes were unable to pay the community charge. I must remind my noble friend of two vital points. Those on low incomes will be eligible for rebates of up to 80 per cent. plus the uprating of income. That is a great move forward from the present system.
Secondly, in relation to the point I mentioned earlier, and which my noble friend Lord Beloff raised, I must remind your Lordships that no one will he committed unless they show wilful refusal or culpable neglect; that is, they have the money, could have paid, but did not do so.
The noble Lord, Lord Henderson of Brompton, picked up a point made by my noble friend Lady Faithfull about single parent families. The noble Lord is right to be concerned about them. They are the type of people the Bill helps. Over 80 per cent. of single parent families will benefit from this Bill.
The other point to which I must reply was the concern raised as to why the committal to prison was not on the face of the Bill at its introduction. It is true that the provision for imprisonment was not on the face of the Bill at that stage. However, that did not represent a change of policy. We had already made clear that with the community charge, as indeed with rates, we would provide full imprisonment as a last resort. It was a point in the Bill which as published did not fully represent the Government's policy. Naturally it was therefore amended at the first opportunity in another place.
Lastly, to my noble friend Lord Renton I would say as regards the attachment of earnings that the Bill provides for attachment of earnings, but only earnings. That does not cover the self-employed and those, for example, on substantial occupational retirement pensions.
Perhaps I may summarise as follows. We understand the concern of your Lordships that has been expressed both at Committee stage and today about committal to prison. But that is not the subject of the amendment. The subject of the amendment is whether we should transfer from the magistrates' courts to the county court the procedures for recovery of the community charge. I hope your Lordships will agree, in view of what I have said, that it is right to leave that with the magistrates' courts.
Lord Elwyn-Jones: My Lords, I and I suspect many in the House will find that reply deeply disappointing, coming from a Minister who had previously shown some humanity on this scene. I am still puzzled by the fact that these proposals did not appear even at Second Reading of the Bill in another place; it was not only on first printing. Therefore, some second thoughts must have come from a mysterious source, I know not where. What I submitted, and what has

1723
been submitted by others who have spoken, is that experienced bodies in this field like the National Association of Citizens' Advice Bureaux and NACRO are passionately anxious about the effect the Bill will have in increasing the size of the prison population. There is widespread opinion of a substantial character to that effect. Once the Bill becomes law, it will be too late to say, "I'm sorry, we made a mistake". Now is the moment to prevent the error arising.
The effect of the amendments is to transfer the responsibility for dealing with this matter to the civil court and to have it dealt with as a civil matter, not as a criminal matter. The criminal aspect will not arise when the matter falls to be dealt with by the county court. The county court is especially skilled and familiar with the processes of handling debts and trying to deal with them in a manner to achieve a solution rather than a penalty or a term of imprisonment. I implore the noble Earl and the Government to have second thoughts about this. If they refuse to do so, I urge your Lordships to accept the view that this should be dealt with as a civil matter.
The attitude of magistrates' courts to concepts like wilful neglect and other matters is highly variable. In our submission this is essentially a civil matter. Those two organisations which I have quoted say very affirmatively that the people most affected or likely to be affected are the poorest people in the community. This will be directed mainly against them and will have the appalling effect of increasing what is already an intolerable position in the overcrowding in our prisons. I must accordingly invite the House to express a view on the matter in the Lobbies.
4.24 p.m.
On Question, Whether the said amendment (No. 48) shall be agreed to?
Their Lordships divided: Contents, 98; Not-Contents, 118.

DIVISION NO. 1

CONTENTS

Addington, L.

Faithfull, B.

Airedale, L.

Gallacher, L.

Ardwick, L.

Gladwyn, L.

Attlee, E.

Graham of Edmonton, L.

Aylestone, L.

Gregson, L.

Blease, L.

Grimond, L.

Bonham-Carter, L.

Hampton, L.

Bottomley, L.

Harris of Greenwich, L.

Briginshaw, L.

Hatch of Lusby, L.

Broadbridge, L.

Hayter, L.

Bruce of Donington, L.

Henderson of Brompton, L.

Buckmaster, V.

Hooson, L.

Carmichael of Kelvingrove, L.

Houghton of Sowerby, L.

Carter, L.

Hughes, L.

Cledwyn of Penrhos, L.

Hutchinson of Lullington, L.

Cocks of Hartcliffe, L.

Ilchester, E.

Coleraine, L.

Jacques, L.

David, B.

Jay, L.

Dean of Beswick, L.

Jeger, B.

Dormand of Easington, L.

Jenkins of Hillhead, L.

Elwyn-Jones, L.

Jenkins of Putney, L.

Ennals, L.

John-Mackie, L.

Ezra, L.

Kennet, L.

1724

Kilbracken, L.

Robson of Kiddington, B.

Kinloss, Ly.

Rochester, L.

Leatherland, L.

Ross of Newport, L.

Listowel, E.

Ryder of Warsaw, B.

Llewelyn-Davies of Hastoe, B.

Seear, B.

Longford, E.

Sefton of Garston, L.

Lytton, E.

Serota, B.

McIntosh of Haringey, L.

Shaughnessy, L.

McNair, L.

Shepherd, L.

Mayhew, L.

Stallard, L.

Melchett, L.

Stedman, B.

Milner of Leeds, L.

Stewart of Fulham, L.

Milverton, L.

Stoddart of Swindon, L.

Mishcon, L.

Strabolgi, L.

Molloy, L.

Tordoff, L.

Morton of Shuna, L.

Turner of Camden, B.

Murray of Epping Forest, L.

Ullswater, V.

Nicol, B. [Teller.]

Underhill, L.

Northfield, L.

Wallace of Coslany, L.

Oram, L.

Wedderburn of Charlton, L.

Perth, E.

Wells-Pestell, L.

Peston, L.

Whaddon, L.

Ponsonby of Shulbrede, L. [Teller.]

White, B.

Williams of Elvel, L.

Porritt, L.

Wilson of Rievaulx, L.

Prys-Davies, L.

Winterbottom, L.

Ritchie of Dundee, L.

NOT-CONTENTS

Alexander of Tunis, E.

Harvey of Prestbury, L.

Alport, L.

Havers, L.

Ampthill, L.

Henley, L.

Arran, E.

Hesketh, L.

Auckland, L.

Hives, L.

Bauer, L.

Home of the Hirsel, L.

Beaverbrook, L.

Hood, V.

Belhaven and Stenton, L.

Hooper, B.

Beloff, L.

Hylton-Foster, B.

Belstead, L.

Jenkin of Roding, L.

Bessborough, E.

Jessel, L.

Blatch, B.

Kitchener, E.

Blyth, L.

Long, V.

Boyd-Carpenter, L.

McAlpine of West Green, L.

Brabazon of Tara, L.

Mackay of Clashfern, L.

Brookes, L.

Macleod of Borve, B.

Brougham and Vaux, L.

Macpherson of Drumochter, L.

Broxbourne, L.

Bruce-Gardyne, L.

Mancroft, L.

Butterworth, L.

Marley, L.

Caithness, E.

Marshall of Leeds, L.

Cameron of Lochbroom, L.

Massereene and Ferrard, V.

Campbell of Alloway, L.

Merrivale, L.

Campbell of Croy, L.

Mersey, V.

Cayzer, L.

Moran, L.

Colnbrook, L.

Mottistone, L.

Colwyn, L.

Mountgarret, V.

Constantine of Stanmore, L.

Mowbray and Stourton, L.

Cork and Orrery, E.

Munster, E.

Cornwallis, L.

Murton of Lindisfarne, L.

Cowley, E.

Nelson, E.

Cox, B.

Norfolk, D.

Craigavon, V.

Nugent of Guildford, L.

Cullen of Ashbourne, L.

Onslow, E.

Davidson, V. [Teller.]

Orkney, E.

Denham, L. [Teller.]

Or-Ewing, L.

Dundee, E.

Oxfuird, V.

Eccles, V.

Pender, L.

Eden of Winton, L.

Pennock, L.

Elliot of Harwood, B.

Penrhyn, L.

Elton, L.

Peyton of Yeovil, L.

Erroll of Hale, L.

Plummer of St. Marylebone, L.

Ferrers, E.

Ferrier, L.

Portland, D.

Foley, L.

Pym, L.

Fortescue, E.

Renton, L.

Fraser of Kilmorack, L.

Rochdale, V.

Gainford, L.

St. Davids, V.

Gardner of Parkes, B.

St. John of Fawsley, L.

Grantchester, L.

Seebohm, L.

Gridley, L.

Selkirk, E.

Halsbury, E.

Skelmersdale, L.

1725

Somers, L.

Trumpington, B.

Stanley of Alderley, L.

Vaux of Harrowden, L.

Strathspey, L.

Westbury, L.

Terrington, L.

Whitelaw, V.

Teviot, L.

Windlesham, L.

Thomas of Gwydir, L.

Wolfson, L.

Thomas of Swynnerton, L.

Young, B.

Trafford, L.

Young of Graffham, L

Resolved in the negative, and amendment disagreed to accordingly.

European Council, Hanover, 27th-28th June
4.30 p.m.
The Lord Privy Seal (Lord Belstead): My Lords, with the leave of the House, I shall repeat a Statement about the European Council in Hanover on 27th to 28th June which has been made in another place by my right honourable friend the Prime Minister. The Statement is as follows:
"With permission, I shall make a Statement about the European Council in Hanover on 27th to 28th June which I attended with my right honourable and learned friend the Foreign and Commonwealth Secretary. The Council's detailed conclusions have been placed in the Library.
"The Council dealt with two main issues: the progress towards completion of the single market by 1992; and arrangements for progressively closer economic and monetary co-operation in Europe. First, the single market: the Council was able to note that over one-third of the measures in the European Commission's White Paper on the single market have now been agreed. Agreements reached in recent weeks cover a number of subjects of particular interest to the United Kingdom: the full liberalisation of capital movements by 1990 for most EC countries, the mutual recognition of professional qualifications and the opening up of the road haulage market by progressive abolition of lorry quotas.
"The Council agreed that priority should be given over the next 12 months to decisions on: the opening up of public purchasing; further liberalisation of banking and other financial services; common standards for manufactured products; and the registration of patents and trade marks throughout the Community. The list does not include the harmonisation of indirect taxes, where the Council simply noted the further studies set in hand by Economic and Finance Ministers. The Government's view is that such harmonisation is not necessary for completion of the single market.
"In considering the social aspects of the single market, the Council noted that removing the obstacles to growth offers the best prospects for creating jobs and spreading prosperity. It also encouraged better protection for health and safety at the work place and easier access to training on which a major initiative was taken during the United Kingdom Presidency.
"The Council reaffirmed the objective of enabling citizens of European Community
1726
countries to move freely throughout the Community, but also stressed the need for effective measures to combat terrorism, drug abuse and organised crime. It is very satisfactory that there is growing recognition of the need for effective safeguards in this area.
"Secondly, on economic and monetary cooperation, the Council agreed to establish a committee of the governors of central banks appointed in their personal capacity. The President of the Commission will take the chair and there will also be a second Commission representative, Mr. Andriessen, and three additional members: Mr. Lamfalussy, Director-General of the Bank for International Settlements; Mr. Boyer, President of the Banco Exterior of Spain; and Mr. Thygesen, Professor of Economics in Copenhagen.
"The committee's task will be to study and propose concrete steps towards the progressive realisation of economic and monetary union. That goal was of course set out in the preamble to the Single European Act which was approved by this House. The committee will report through the Council of Economic and Finance Ministers to the meeting of the European Council in Madrid next June.
"The Council approved unanimously the reappointment of M. Jacques Delors as President of the Commission for a further two-year term from 1st January 1989.
"Foreign Ministers discussed a number of political co-operation subjects, concentrating particularly on East-West relations, Afghanistan, the Middle East, South Africa and Latin America. The Council conclusions on all these subjects are recorded in the communiqué.
"Finally, we were able to note with satisfaction that the important decisions taken at the meeting of the European Council in February on budget discipline and agriculture have now been translated into binding legal instruments. Legislation to give effect to the new arrangements for financing the Community budget, including the new own resources decision, will be laid before the House tomorrow.
"Following the Council. I had a meeting with the Taoiseach to discuss a number of current issues in Anglo-Irish relations. We reaffirmed our commitment to the Anglo-Irish Agreement and agreed to maintain, indeed strengthen, cooperation against terrorism.
"The outcome of this Council was very satisfactory for the United Kingdom. We have confirmed that the way forward in Europe lies through the creation of wealth and jobs, as obstacles to trade and burdens on business are steadily removed. Thanks to this Government's policies and the response of those who work in industry and commerce, British firms will be particularly well placed to take advantage of the opportunities which the single market in Europe offers."
My Lords, that concludes my right honourable friend's Statement.
4.38 p.m.
Lord Cledwyn of Penrhos: My Lords, we are grateful to the noble Lord the Leader of the House for repeating the Statement. We welcome the agreements listed in it. But as we move from one summit to another, it is clear that, while there is some agreement in certain areas, there are other matters upon which there is a sharp conflict of opinion and others where no clear policy is defined. For example, in that part of the Statement which refers to the need to:
"combat terrorism, drug abuse and organised crime",
there does not appear to have been any policy decision or any action proposed to be taken in those fields.
To take the two main issues as they are described in the Statement, the 12 leaders agreed that their objective was:
"the progressive realisation of economic and monetary union".
But the Prime Minister is reported as saying that she did not like the idea of a single currency. Can the noble Lord say whether that is the case? Can he further indicate whether the Government fully support the study which has been set up under the chairmanship of the Commission President to propose concrete stages towards monetary union? Can he tell the House what the point of the study is if the Prime Minister is opposed to its central concern—that is the single currency—in principle?
Can the noble Lord also say whether the Government support the proposal for a European central bank? We understand that that matter is likely to be discussed by the Study Committee. Does he genuinely believe that monetary union is a feasible prospect under current circumstances?
We welcome in general the new measures to improve conditions for the Community workforce and for better Community rules for health and safety at work. Can the noble Lord confirm that the Government support these measures which aim to bring the benefits of the internal market to employees as well as to employers?
We warmly welcome the warning issued about the consequences of executing the Sharpeville Six. Can the noble Lord say whether the terms of the Statement mean that further diplomatic and economic sanctions may be imposed by the Community against South Africa and whether the Government would support such measures? We also welcome the call for the release of Nelson Mandela and all other political prisoners detained in South Africa.
Finally, as regards the new legislation for financing the Community budget which was referred to, do the Government expect that legislation to go through Parliament in this Session, given the difficulties which they are experiencing with legislation?
Lord Jenkins of Hillhead: My Lords, perhaps I may also express my gratitude to the noble Lord for repeating the Statement and express our welcome for the splendid last few weeks of the German six-month Presidency. Can we now be assured that the Prime Minister is not merely acquiescing dismissively in the
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Committee under M. Jacques Delors which has been set up to look into the questions of a European central bank and a possible common currency but is taking those matters seriously? Last week the Prime Minister certainly gave the impression of dismissing them.
Will the noble Lord agree that that is a slightly ludicrous position? Given the power structure of Europe, if we have an issue which the French and German Governments are taking seriously, we cannot dismiss it as not being serious. We may disagree about the matter, but we cannot say that it is not a major issue for Europe.
Is it not also the case that the train of Europe is now gathering speed with a momentum that frankly surprises me? I would not have expected it two years ago. But it is gathering momentum in a quite remarkable way. Will not the noble Lord recognise that if the attitude of the Prime Minister, as expressed in the House of Commons last week, persists, we shall be left once again merely waving goodbye to the train from the station platform as we did in 1951, in 1957 and in 1978 for three separate European initiatives, for which we have since paid a heavy price. Can we be assured that that will not happen for a fourth time and that we have learnt from previous experiences?
4.45 p.m.
Lord Belstead: My Lords, I am grateful to the noble Lords, Lord Cledwyn of Penrhos and Lord Jenkins of Hillhead, for their reception of my right honourable friend's Statement which I have repeated. The noble Lord, Lord Cledwyn, specifically said that he thought it was disappointing that no definite policy was set out as regards the combating of terrorisim, drug trafficking and organised crime. Perhaps I may make it clear that there is no doubt that the Heads of Government all want the removal of all obstacles to freedom of movement. However, the European Council has consistently maintained that the means of achieving that objective must be consistent with the fight against terrorism and drug trafficking. Its conclusions reaffirm that commitment. Although that may not be quite the detail that the noble Lord wants, I believe that the affirmation of that principle is very important indeed.
Both noble Lords commented on the Statement as it refers to monetary co-operation. In essence, they both said that they felt that my right honourable friend was perhaps less enthusiastic than others in some way concerning the objective of European monetary union. I first make the point that the language to be found in the communiqué from the summit is the language which is to be found in the Single European Act. That Act went through both Houses of Parliament under the Government headed by my right honourable friend, and we stand by that language.
However, on the point specifically put to me by both noble Lords, a working group has been set up under the chairmanship of M. Jacques Delors and the task set for the working group by the European Council is to study and propose concrete steps towards the objective, reaffirmed in the Single European Act, of progressive realisation of economic and monetary union. Clearly neither creating a

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European central bank nor issuing a common currency are early steps in the process. Indeed, the Bundesbank governor recently reminded us that even completion of the process does not necessarily require either development.
The noble Lord, Lord Jenkins, has such immense experience in the field that I hesitate to cross swords with him. However, when he speaks of waving goodbye to the train, I simply make the point that we are not exactly left down the line. The United Kingdom is a long way up the line from many of our colleagues in the European Community in abolition of capital movements, exchange controls and many other things. We have gone along the railway line and I believe that all members of the Government are glad that we have done so.
The noble Lord, Lord Cledwyn, asked a question concerning Sharpeville and South Africa. We do not support the extension of the imposition of sanctions and our policy on sactions remains the same as it has always been. As regards the very serious Sharpeville situation, we have, as he will know, been extremely active in this area. Our concern has been to ensure that due account should be taken of the fact that the legal process is not yet exhausted. We will certainly stick to that, and hope that the story will have a satisfactory ending.
The noble Lord, Lord Cledwyn, asked about the legislation to which the Statement refers. The Commons timetable for the legislation is Second Reading beginning on 11th July and the remaining stages after the Recess. We therefore expect the legislation to come before your Lordships' House, I would guess, during the month of October.
Lord Kennet: My Lords, perhaps I may thank the noble Lord the Leader of the House on behalf of SDP Peers also for reading the Statement. We are inclined to agree with what has been said by the noble Lord, Lord Jenkins, about the train, despite the most elegant disclaimer by the noble Lord the Leader of the House.
It is always interesting to compare the British Government's Statement about a summit with the summit statement itself. Perhaps I may draw the Government's attention to certain matters which were in the summit statement but not in the government Statement, and ask whether their exclusion means that the Government feel less happy about them than they do about the matters mentioned in their own Statement.
Those matters are, first, associating the European Parliament more closely with the Council at this stage of achieving the unified internal market; the importance of measures to prevent evasion and fiscal fraud; and the concept of the integration of environment considerations in all areas of economic policy-making—something we have been asking for for years. On the political co-operation side, there is the welcome given to the establishment and recognition of relations between the Community and the Soviet Union and the Warsaw Pact countries; the statement that the status quo in the territories occupied by Israel cannot be sustained; and the appeal to the South African Government to release
Vol. 498
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Nelson Mandela on his birthday, which falls in this month. Does the fact that those matters are not mentioned in the government Statement mean that the Government feel less strongly in favour of those points than of the points which they singled out for mention in the Prime Minister's Statement?
Lord Belstead: My Lords, it is important for me to make the point in answer to the noble Lord that the summit which the Prime Minister recognised in her tribute to the presidency as workmanlike—I reiterate what the noble Lord, Lord Jenkins of Hillhead, said in this respect—concentrated on two main areas. These are mainly the subject of the Statement which I have repeated and mainly also the subject of the questions I have been asked from the Opposition Front Benches: progress towards the completion of the single market by 1992 and arrangements for progressively closer economic and monetary cooperation in Europe. Therefore, all the other questions which the noble Lord has put to me, interesting though they are, are to that extent subsidiary.
Also, the foreign affairs issues which he raised, although enormously important, are not the subject of this Statement. Of course relations between the Soviet Union and the European Community are extremely important. I think that many of us working in politics—I am sure that I share this thought with the noble Lord—believe that the position of the European Community and the Soviet Union, clearly coming closer together, is historically of enormous importance. Incidentally, so far as concerns Arab-Israeli and Lebanon matters, the position of the Community is very well known and does not change.
I am not in any way trying to belittle what the noble Lord said. However, I think it is important to say that this very workmanlike summit, as my right honourable friend the Prime Minister has termed it, concentrated on those two main issues which do not fall within those listed by the noble Lord in his question.
Lord Jay: My Lords, will the Government be extremely cautious in accepting any agreement which would mean the abandoning or weakening of the United Kingdom Government's control over the sterling exchange rate? Without that we should be left with very little control over our own economy in a period in which we are drifting into ever-greater external deficit.
Lord Belstead: My Lords, my short answer to that question is, yes. Caution will certainly be our watchword.
Lord Broxbourne: My Lords, further to the reference in the Statement to the Single European Act, could my noble friend tell the House whether consideration was given at the summit to the effect and implications of Article 100A of that Act? The article substitutes a so-called new co-operation procedure for important matters hitherto requiring unanimity under Article 100 of the EC treaty.
Lord Belstead: My Lords, I did not catch the subject to which my noble friend attached his question. If he was attaching it, for example, to the main issues which are the subject of the Statement, I recognise that the question is very important. Unanimity of course plays a part. Would the noble Lord like to clarify that point?
Lord Broxbourne: My Lords, if my noble friend will study the procedure under Article 100A of the Single European Act he will see that it substitutes a so-called co-operation procedure which does away with the requirement of unanimity in important matters affecting the national interest.
Lord Belstead: My Lords, perhaps I may then have the luxury of picking out the issue which I think is of great national interest. That is the area both noble Lords on the Front Benches opposite asked me about, namely monetary co-operation. I should like to make it absolutely clear—if that is the issue we are talking about—that the Single European Act itself states that,
"insofar as further development in the field of economic and monetary policy necessitates institutional change"
unanimity is required.
Lord Stoddart of Swindon: My Lords, is the noble Lord aware that we are a little puzzled by the Prime Minister's apparently different statements in different places? Is he aware—I am sure he is—that in the House of Commons last Thursday the Prime Minister appeared to rule out completely any idea of monetary union and certainly of a central bank? She said that that would mean one single unitary state or federal state and would not need 12 different governments and 12 different parliaments.
It appears that at Hanover, in agreeing to the committee to examine a European central bank and monetary co-operation, the Prime Minister changed her mind. Can the House be assured that her statement last Thursday in the House of Commons interprets properly government policy? Can we also be assured that the statement by Monsieur Mitterrand that he and Germany would pull the others along if they resisted monetary union will be resisted by the Prime Minister herself?
Further, could I ask the noble Lord if he will deny rumours that there is to be a European cross-border police force? If such a police force has been proposed can he give an assurance that Parliament would be given the opportunity to decide whether or not that happens?
Lord Belstead: My Lords, my right honourable friend the Prime Minister always states government policy when speaking in another place. Perhaps I may make it clear that my right honourable friend was party to the setting up of the working group. Nonetheless the deliberations of the working group can proceed in looking at important practicalities in the area of monetary union without having to enter the area of a European central bank or a common currency.
When the noble Lord asks me what the British Government's attitude will be at the end of the day,
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my answer is the one I gave to my noble friend Lord Broxbourne—that if we reached that stage unanimity is the order of the day and the Government would make up their mind at the time. So far as concerns President Mitterrand, I do not answer for the French.
Finally, the noble Lord asked me about cross-border co-operation and police forces. I am not in any way trying to be dismissive of what the noble Lord has said, but I think that there is nothing I can add to what was said in the Statement. If I may say so, the noble Lord, Lord Cledwyn, made a very important point. Although there is no detail in the Statement about these subjects there was clearly agreement on the principle that in dealing with the enormously important matters of terrorism, drugs and organised crime, the first thing which has to be considered by the member states is how to deal with those matters, borders or no borders. As to how those matters are pursued, I am afraid that there are no details that I can give the noble Lord from the Dispatch Box today.
Lord Mayhew: My Lords, will the noble Lord remind the House briefly of the reasons why the Government are not more enthusiastic about European monetary union?
Lord Belstead: My Lords, I do not think that there is anything that I can add to what I have already said. A working group has been set up, the president of the Commission is in the chair, and very distinguished people will take part in the group. They will report back through the finance ministers. I think we ought to wait until we hear from the finance ministers on this particular matter.
Lord Ardwick: My Lords, surely we accepted monetary union when we entered the Community; but it has always been a rather distant goal, particularly since it implies some measure of federalism. There is an intermediate goal—the EMS—which will have to be strengthened when the Single Act comes into force. It is rather surprising that the Statement mentions nothing at all about that aspect of the subject.
Lord Belstead: My Lords, it may be that the Statement says nothing about that subject, but that is for the very good reason that the Government's position remains the same as it has always been.
Lord Ezra: My Lords, can the House be given some clarification concerning the prospects for the freer movement of individuals, which was the first point to which the noble Lord referred? He said on the one hand that the objective was that individuals would be able to move around more freely within the Community from 1992 onwards. On the other, he referred to the very desirable objective of dealing with drug trafficking, etc. Will the two be related, and will the result be that the movement of individuals from one country in the Community to another will remain as restricted as it now is for those reasons? Or will the two issues be separated, and will those of us who are not engaged in those nefarious activities be able to move more freely while action is taken to deal with the others in the necessary manner?

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Secondly, in respect of the other matter—monetary union and a central bank—may we take it that as the United Kingdom has agreed to the working party being set up its report will be considered quite objectively and we in this House will have the opportunity of fully debating its conclusions?
Lord Belstead: My Lords, perhaps I may reply very quickly to the noble Lord. I think it is important that I should underline the fact that the United Kingdom joins with all colleagues in the Community in wanting to see liberalisation of the market within Europe; that is what 1992 is all about. It applies to the point put to me by the noble Lord concerning the movement of people.
When one comes to deal with life and death matters of terrorism, organised crime, and indeed drug trafficking, the Statement says, I believe rightly, that it is very satisfactory that there is growing recognition of the need for effective safeguards in that area.
So far as concerns the well-worn matter of the working group under Mr. Jacques Delors, as I have said that working group is to report back through the European finance ministers. I think that we in Parliament, as indeed the Heads of Government in the Council, will need to await news when it comes back from the European finance ministers.
Lord Hatch of Lusby: My Lords, does this Statement not illustrate the arrogance and inconsistency of the Prime Minister and the Government in respect of foreign affairs? It would appear from the Statement that the Government wish to go into Europe but only on their own terms, just as they act in the Commonwealth and at the United Nations. I should like the noble Lord the Leader of the House specifically to expand on that part of the Statement which refers to the Sharpeville Six and the attitude to South Africa. Is it not the case that the British Foreign Secretary stood on his own against the rest of the foreign ministers of the EC who wished to take strong action, including both diplomatic and economic sanctions, if clemency were not shown to the Sharpeville Six; that he stood out against that action; and that he had the communiqué altered solely because British policy so far as its attitude to South Africa is concerned is out of step with the rest of the EC, the Commonwealth and the United Nations?
Lord Belstead: My Lords, I think that the noble Lord, uncharacteristically, is being a little less than generous when he refers to my right honourable friend the Prime Minister. My right honourable friend has led this country to play a leading role in Europe. It is not a question of going into Europe; we are in Europe and we are playing a leading part in Europe.
As regards the second question put by the noble Lord, I should like to make it absolutely clear that we have fully supported appeals by the foreign ministers of the Twelve, by the Toronto summit, by the United Nations Security Council and by the European Council about the Sharpeville Six. On 15th March
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my right honourable friend conveyed to President Botha our hope that he would exercise his prerogative of mercy.
Lord Hatch of Lusby: My Lords, I was talking about action—
Noble Lords: Order!
Lord Hatch of Lusby: I was not talking about words, my Lords. Words have been used for a long time about South Africa, and we have seen the results.
Noble Lords: Order!
Lord Hatch of Lusby: I asked what action the Government are taking.
Lord Belstead: My Lords, the reason "order" is being called is that there is a paragraph in the Companion which recommends that Statements should take no longer than 20 minutes. I think that the noble Lord has had quite a good go.

Local Government Finance Bill
5.4 p.m.
Consideration of amendments on Report resumed on Clause 12.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 49:
Page 9, line 14, at end insert—
("(6A) For the purposes of facilitating the calculation of the personal community charge under this section, the compilation of the register under section 6 above, and the collection of the charge under sections 22 and 24 below, the Secretary of State shall make a determination under section 91(3)(d) below as to the amount of grant he proposes to pay to receiving authorities in reimbursement of 80 per cent. of the actual cost incurred".).
The noble Lord said: My Lords, I venture to claim that Amendment No. 49 is a proper Report stage amendment. In Committee we considered the cost of collection of the community charge and sought to persuade the Government that because it would be so very much higher than the cost of the rating system, the charge of setting up and administering the system ought not to fall on the local authorities, who are hardly responsible for its introduction, but on central government which is wishing the system upon them.
We urged that course on the best evidence available to us. At that time the report of the Government's own consultants, Price Waterhouse, had not yet been published. To some extent, therefore, we were speaking speculatively about the cost of collection of the community charge. The best evidence we had was contained in the Explanatory and Financial Memorandum to the Bill as it appeared before the Committee, which said:
"It is estimated that the total additional cost to local authorities in a full year will be in the range of £160 million to £200 million. Expenditure in the range of £70 million—£90 million is expected in 1989–90 on the establishment of the register and preparation of new billing and collection systems".
The Government must be grateful that it is the convention of the House that the Explanatory and

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Financial Memorandum is not repeated when the Bill is reprinted, as amended in Committee, because those figures look pretty absurd now not only in the light of the Price Waterhouse report but also of the calculations that have been made by the local authorities themselves.
I take it that the Government will not deny that instead of a figure of £70 million to £90 million for implementing the new system, the figures from Price Waterhouse are £38 million in 1988–89 and £325 million in 1989–90—a total of nearly £363 million. With the system in place the cost in a full year was said to be £160 million to £200 million. The estimate now is that the cost will be £435 million.
Those are huge figures, enormously greater than anything ever admitted before. It is not even as though the Government had not had an opportunity to revise their own figures. The local authority associations themselves took the precaution of carrying out surveys among authorities which I was able to present to your Lordships' Committee and which showed that the costs would be very much greater than the original estimates. Yet, speaking at Second Reading, the Minister said that the unit cost of collection of the community charge would be no greater than the unit cost of collection of the rates. What he meant by that was that the cost per name on the register would be no greater than it is for the rates; in other words, the cost would increase by the amount by which the length of the register (the number of people on the register) is greater for the community charge than for the rates. In other words, he admitted that the total cost of the community charge would be very much higher but argued that the cost for entry would be the same.
Even that prediction has been repudiated by the Price Waterhouse report which indicates that the cost of maintaining the register will be £1·50 per head and that the other costs involved in the community charge will be £9·20 per head, making a total of £10·70 compared with the sum of £8·50 per rateable hereditament under the rating system. So even the more recent figures which the Government gave to this House have now been disproved by the Government's own consultants.
As regards the rebate system, I suspect that even the calculations of Price Waterhouse are out of date because of the changes, some of them very welcome, that are taking place to the rebate system as it proceeds through your Lordships' House. According to the calculations, the rebate system would cost an extra £81 million to administer, whereas the rates rebate system we have at present costs £65 million. In addition to that—and there are many local examples which are pouring into us day by day—there will be huge demands on additional staff. Price Waterhouse estimate that an additional 14,000 to 18,000 town hall staff will be needed to run the new systems.
It has been a favourite sport of Members of this House on the government Benches to deplore the extravagance of local authorities. There are many noble Lords, some of them present today, who have taken great delight in proclaiming that local authorities are extravagant and reckless, that they do
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not care about the pockets of the ratepayers, and that it is to control this extravagance that these measures have to be introduced. Can we imagine anything more extravagant than the expenditure of all this additional money, not to produce a single new benefit for a single individual but simply for administration of this cumbersome and unjust system? Can there be any greater example of extravagance than that which is now being forced down the throat of the British people by this Government?
I have to ask whether the Government have fully appreciated the enormity of what they are doing in putting forward this system, and I have to ask some specific questions about the way in which they are doing it. The first question, obviously, is: why did they get it so badly wrong? Why have their estimates been so patently disproved by the Price Waterhouse calculations? Why could those sums not have been done before the Bill was introduced? Would it not have given pause to any sensible government, and an opportunity to think again about this madcap system?
If it is true, as Price Waterhouse say, that the set-up costs are going to be as great as this, are the set-up costs—leave the running costs on one side for the moment—going to be met in full, and are there going to be adequate capital allocations for the accommodation and the computer systems, and so on, that will be needed by this additional staff? Indeed, in the light of the fact that Price Waterhouse say that most authorities find it difficult to recruit suitably qualified and experienced personnel for senior posts—and this is especially true in London and the South-East—are the Government confident that we are going to find the additional staff?
Are the Government satisfied indeed that the Price Waterhouse report is even now adequate to represent the true costs of the community charge system? They have assumed, for example, that there will be no specific problem of evasion of the tax, but all the evidence from taxes of this kind—like the car tax and the TV licence tax—is that there will be a significant level of evasion, and that this level of evasion will not only put up the community charge for those who do not evade the charge but will also increase the administrative costs for local authorities.
Price Waterhouse do not appear to make any provision for the special difficulties of collection in inner city areas, but we know that electoral registers are badly incomplete in inner city areas. We know that the defects probably run at a level more like 17 per cent. or 20 per cent. compared with less than half that in other parts of the country. If that is true for the electoral register, is it not also going to be true for the community charge register?
So far as we can tell, Price Waterhouse have made no specific provision for the cost of collecting from students, and yet we have seen from the debates in this House on this Bill that the system proposed for students, with the establishment of certification officers and all this paraphernalia in the universities and colleges, is going to be particularly difficult, and therefore expensive. Price Waterhouse, so far as we can tell, have not made any specific provision for the cost of staff training, although they say that there will

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be a need for an extensive training programme for staff. If that has not been taken into account, then the true figures for the cost of the community charge are going to be very much higher.
Price Waterhouse have not made any allowance for the kind of publicity that is going to be necessary. We understand that the Government are raring to go and champing at the hit with publicity for the community charge as soon as this Bill receives Royal Assent. That of course will be a charge on the taxpayers and not on the community charge payers, but it will be an equally unjustified expense, an equally unjustified burden, on hard-pressed taxpayers.
Finally, the consultants do not appear to have made any estimate of the costs of the additional number of people who are likely to be paying by instalments. At the moment only 20 per cent. to 30 per cent. of rates are paid by instalments, but it seems highly likely that far more people will wish to pay by instalments when the new community charge comes into effect.
We come to the wording of the amendment itself. I have discussed the need for it and now I come to the actual wording. What we propose is a reasonable compromise. Instead of saying that the whole cost of the administration of the community charge should be borne by the Government in the form of increased grant—because I understand, although I did not agree with them, the points that the noble Earl made at Committee stage when he argued that full reimbursement would not encourage local authorities to be economical and prudent in their administration of the community charge—we say that there should be a half-way stage between the 60 per cent. that is now likely to be proposed and the full payment. We are proposing reimbursement of 80 per cent. of the actual cost incurred.
That leaves a sufficient burden on the local authorities and on the community charge payers to ensure that they will do their best—with the benefit, I must say, of the best practice recommendations in the Price Waterhouse report—to see that the system is as economical as possible. But it also reflects the fact that, with the best will in the world, with the best practice, with the most efficient system, with the greatest of good fortune on staff training and staff availability, the system is going to be enormously more expensive than the rating system, and that is the fault not of the local authorities but of the Government themselves.
I suggest to the House that it would be right to make the concession proposed in this amendment, to recognise the fact of the burden on the community charge payers and to recognise the resposibility of the Government for that additional burden. I beg to move.
5.15 p.m.
Lord Boyd-Carpenter: My Lords, the noble Lord, Lord McIntosh of Harringey, during the first three-quarters of his speech devoted his attention to indicating his dislike of the community charge system. Your Lordships have discussed this at considerable length at earlier stages of the Bill and it does not seem to me that those broad, important
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questions arise at all on the amendment that he is proposing.
The noble Lord's amendment relates to the distribution, as between central and local government, of the costs of setting up the new system. It will surprise no one with any experience of administration if the costs of setting up a new system considerably exceed the original estimates. I think I know of no major changes in the administration of affairs in this country where that has not been the case. That of itself, I say to the noble Lord, is no argument against the broad decision of policy which your Lordships' House has already approved. That there will be some costs is clear. Therefore the only real question for your Lordships at the moment is the much narrower one as to what exact percentage of the costs of setting up the new system should fall on the local authorities and what percentage should be carried by central government.
The first point that I think occurs to anyone who has any experience of administration is that unless a substantial part of the costs fall on the local authorities who are actually doing the collecting, there is no guarantee that this will be done as economically as possible. Where one draws that line exactly is no doubt a matter of genuine difference of opinion. To talk of being liable for only 20 per cent. of the costs of the whole operation seems to me a most dangerous suggestion. When one is doing something administrative and has to pay for only one-fifth of it, there is less incentive to exercise rigid economy than if one is paying the whole or a substantial proportion of it. After all, it must be remembered that Parliament having decided, as it will have, that the new system shall take effect, the setting up of the proper administrative system in each local authority area is very much in the interests of that authority because a quarter of its revenues will depend on the efficient working of the system. It is the local authority that stands to gain or lose most according to how well that job is done.
It seems to me therefore that the noble Lord, Lord McIntosh of Haringey, is allowing his immense and obvious distaste for the whole Bill to colour his normally acute judgment on matters of local government finance. I add only one comment: in the light of the many discussions that we have had in the House, particularly with the noble Lord taking the lead, it is cheering and encouraging to hear him expressing anxiety about excesses of local government expenditure.
Lord Ross of Newport: My Lords, I strongly support the amendment so ably moved by the noble Lord, Lord McIntosh of Haringey. It comes a bit rich at a time when the Government have had to admit obtaining a report from outside experts that the cost of collection will be at least double their original estimates. We have thrown at us constantly the inefficiency of local authorities. In the Price Waterhouse report, reference is made to the variation in cost of collection in raising from something over £400 million down to £379 million. Even in the case of the most efficient local authorities, the report says that the cost is likely to be £379 million by 1990. I accept the point made by the noble Lord,

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Lord Boyd-Carpenter, that it is only right that local authorities should meet part of the amount. If some of it is not included in their responsibility, there is a risk that the money will not be collected in the most efficient way possible.
I am not going to argue that we should not be introducing a poll tax. I think that it is mad and that the Government are daft; but they are going ahead with it. We are trying to find a fair deal for local government by means of the amendment. If the Government themselves have so wrongly estimated, it is only right that we should be pressing amendments in the House to make sure the Government recognise that the cost to be borne by the local authorities will be enormous and that therefore it is up to the Government to make some greater contribution, at least while the new tax is being introduced.
This will probably be the most expensive tax ever introduced in the country. It is certainly far more expensive to collect than VAT and income tax—although one part of income tax may be slightly more expensive to collect. Nevertheless, this tax is heading towards being the most expensive tax ever introduced. It is only right therefore that we in this country who support local government. who believe that it has a role to play and who wish to see it given back its strength and not utterly annihilated, should ensure that it has a fair deal if it is obliged to introduce a tax that I imagine most local authorities also think is daft.
We do not need to guess what the poll tax will cost in England and Wales because we know what is happening in Scotland. The administrative burden for the authorities of compiling poll tax registers is proving enormous. Tracking down 3.9 million Scottish adults liable for the poll tax has been every bit as difficult as was feared and predicted in the other place and here. We know that Strathclyde is trying to track down 2.3 million adults. We know that the council reckons on spending at least £5 million on capital costs to get the system running, and £8.6 million a year thereafter. It needs 370 extra full-time staff and at present is employing 100 canvassers to help with the register. Lothian needs an extra 150 staff, with costs in the region of £2.8 million for computers and £4.25 million for computer staff.
Once it is off the ground—if it is to remain, heaven help us—these costs naturally will not automatically recur. But it is surely beholden on the Government to make a real gesture when the new tax is being introduced. If, in the reply, we are to be told about efficiency, perhaps I can throw back this question to the Department of the Environment: is it not time that the Government looked at the activities of the PSA, which is about the most inefficient state agency business in the country?
Lord Stoddart of Swindon: My Lords, the noble Lord, Lord Boyd-Carpenter, criticised my noble friend Lord McIntosh of Haringey for coming back to the principle of the poll tax or community charge. The noble Lord ought to realise that it is virtually impossible on any amendment not to come back to the principle of whether we should have a poll tax
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because the tax, as has been shown throughout the debates in the House and indeed in another place, is unpopular on all sides. With the best will in the world, most people believe that it will be much more difficult to collect the tax than it is to collect rates. The local authorities will be under an additional burden of costs in regard to staff.
It is clear, having read my local evening newspaper, the Reading Evening Post, of last Monday, that Reading Borough Council and its treasurer, Mr. Innes, are already considerably worried about the cost of collecting the poll tax and of the new machinery, equipment and staff that will be needed. Mr. Innes—he is not leader of the council, Labour or Tory, but borough treasurer of Reading, which traditionally has had good treasurers who know what they are talking about—has told his local authority that the poll tax will cost an extra £2·6 million in collection charges. Indeed, the rate having been made for 1988–89, he now asks the council to provide him with an extra £87,000 this year for preparatory work in advance of the poll tax coming into operation. Mr. Innes has already informed the council, which will undoubtedly be criticised by the Tory opposition on the council for the increase, that he needs an extra 43 staff to put the poll tax into operation.
Reading, I am glad to say, has practically no unemployment. Firms are finding it difficult, indeed well-nigh impossible, to recruit qualified staff. So where on earth Mr. Innes will get the extra 43 staff from, I do not know. Nevertheless, he needs them and will have to have them if the borough is to collect the rates for itself and for the county council. Mr. Innes will also need a new computer, which will cost an extra £1 million. As to Reading Borough Council having to meet and overcome these difficulties, it is not a large city but, I suppose, a town of about 140,000 souls. In places such as Birmingham or Manchester we can imagine the additional costs that will be involved. It is quite clear that my noble friend's amendment is very timely and necessary, unless the poll tax charge is to be far higher than the Government estimate.
I promise that this is the last time that I shall quote Mr. Innes, the borough treasurer of Reading. He estimates that instead of the £246 per person which the Government believe that people in Reading will have to pay, on his calculations they will have to pay £280 per head, an increase of £34 over and above the government estimate. My noble friend knows about these things and is concerned about local authorities and ratepayers. They will no longer be called ratepayers; we shall have to call them charge payers. That is an un-British expression, is it not?
My noble friend is absolutely right to try to assist the people who will have to pay this charge and the local authorities by bringing forward his amendment. Local authorities over the last eight or nine years have been clobbered to the extent of about £13,000 million and it is about time they had some consideration. I hope that the noble Earl will be helpful in his reply.
5.30 p.m.
Lord Underhill: My Lords, I follow my noble friend because local facts are very useful to underline

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information such as that my noble friend gave. To reply to the noble Lord, Lord Boyd-Carpenter, I thought that my noble friend was very impressive in the information and facts he gave concerning the costs of setting up and operating the machinery.
This morning I read my local newspaper, the West Essex Gazette. I live not in a Labour-controlled authority area, not in one of the extravagant areas, but in the area of the Epping Forest District Council. For some years there has been a controversial scheme for the centralisation of the offices of the Epping Forest local authority. The scheme, which has been approved, is quite costly and development is now being carried out in the commuter country town of Epping. What do I find in the local newspaper? Already there is consternation. The question of accommodation in the centralised offices has been thrown into turmoil because it has been reported to the council that an additional 40 staff members will be required. If one multiplies 40 by the number of district councils in England/Wales it seems to come to about 16,000, which is well in line with the Price Waterhouse figure that the extra staff required will be between 14,000 and 18,000.
The local facts provided by my noble friend Lord Stoddart of Swindon together with those I have given surely bear out what my noble friend said about the costs of administration and staffing.
The Earl of Caithness: My Lords, I should like first to take this opportunity to speak generally on the subject of costs before dealing with the specific issues raised by these amendments. During the Committee stage I undertook to make available the results of the Price Waterhouse study when we received the final report. Price Waterhouse has now completed its report and copies were placed in the Library last week.
So far as the findings of the report are concerned, they generally confirm the Government's assumptions on costs. Your Lordships will be interested to know that in particular the consultants confirm what the Government have always maintained—that the cost of collecting the community charge will be similar to the present average cost of collecting rates from each ratepayer. The consultants estimate that these costs, including NNDR, will be between £379 million and £435 million in 1990, compared to the £200 million it now costs to collect rates each year. These costs will be taken account of in revenue support grant settlements from 1990–91 onwards. This surely refutes the allegations of the noble lords, Lord McIntosh of Haringey and Lord Ross of Newport, who have claimed that we have our figures grossly wrong.
The report also confirms that most of the expenditure on preparation will fall in 1989–90 and that the resources that the Government have provided for 1988–89, including the £25 million capital allocation, should be sufficient for any limited expenditure required this year. We shall, of course, be taking account of the Price Waterhouse findings that current expenditure in 1989–90 on preparation costs could be between £99 million and £122 million in our
1742
proposals for the RSG settlement. Additional capital allocations will be made when we have further considered the figures contained in the report.
Final announcements on the resources we shall be making available will be made following the usual consultation with local authority associations on RSG and in the specification of capital allocations which will follow the Chancellor's Autumn Statement.
The noble Lord, Lord McIntosh of Haringey, omitted to mention what I consider to be an important fact in the report—that there is scope for economies of up to 15 per cent. if all authorities were to perform as well as the most efficient in their category. I am sure that the noble Lord, like us, hopes that local authorities will take that on board. We shall also be disseminating to all charging authorities Volume II of the report covering best practice which, if followed, should help authorities to implement the new arrangements in an efficient and cost-effective manner.
I turn to the amendments. We discussed an amendment very similar to Amendment No. 215, which is being taken with this amendment, in Committee. I explained then that the attempt to have a particular amount of grant somehow set aside specifically to support administration, collection and enforcement costs was quite contrary to the unhypothecated, block grant nature of revenue support grant. Grant will be paid in relation to the totality of an authority's needs as measured by its needs assessment, but it will not be allocated to particular services. The nature of an unhypothecated block grant of this kind is that, having fixed the distribution of it between authorities, we let them decide what they are going to spend in total, how they are going to divide that total between the services they provide and how much they need to raise from local people. The idea that some part of the grant should be set aside does not fit into this framework and cannot easily be made part of this regime.
The noble Lord, Lord McIntosh of Haringey, explained on that earlier occasion that he was not seeking to influence the total of grant available but rather to make clear to chargepayers what money is going to services and what money is going to administration. But that cannot be done by specifying an amount of grant nominally going to support those costs if the authority can in fact spend as much or as little as it likes on administration. The level of grant would not necessarily indicate the level of spending.
The version of this amendment before us today introduces another principle which is equally unacceptable to us. It seeks to ensure that the amount of grant paid towards these costs shall be 80 per cent. of the actual costs incurred. Those are important words, for I remind your Lordships that we shall not know at the time we make the revenue support grant report what the actual costs incurred in the forthcoming year will be. Even if we had such clairvoyant powers, we have made it one of the main principles of the grant system that grant will depend only on need and not on actual expenditure. This ensures that grant entitlement does not vary. It means

1743
that we assess how much each authority needs to spend; we distribute grant accordingly; and we do not alter grant in relation to their spending decisions. This amendment would require us to pay grant in relation to actual costs. So a less efficient authority would get more grant than an efficient one and, because the total of revenue support grant would be fixed, it would take more grant out of the amount available for distribution generally. As my noble friend Lord Boyd-Carpenter said, this is exactly the kind of situation that we want to avoid. I cannot believe that any of your Lordships would want to reward efficiency and penalise efficiency in this way.
I shall answer the specific point of the noble Lord, Lord Ross of Newport, when he claimed that registrations in Scotland were proving extremely difficult. I understand that good progress is being made in all registration areas north of the Border. In many areas more than 90 per cent. of canvass forms have already been returned. Your Lordships will know that the register does not go live in Scotland until 1st October this year so we appear to be well on target for extremely high levels of registration. I also confirm that there is no evidence that the costs are running above the levels invisaged by the Government in their most recent estimates.
Finally, I should like to underline the fact that it has always been the Government's intention to ensure that authorities receive the resources that they need to implement the new arrangements. I hope that that will calm the fears of the noble Lords, Lord Underhill and Lord Stoddart of Swindon. The Price Waterhouse report will help us in our considerations of the level at which those resources should be made available.
Lord McIntosh of Haringey: My Lords, I make no apology to the House, and specifically to the noble Lord, Lord Boyd-Carpenter, for having drawn attention to the financial effects of the policy to which the Government wish the House to agree. Having decided at the beginning of your Lordships' Committee stage that it wished to see a flat-rate community charge, I believe that it is the proper responsibility of this House to look at the proposition carefully and critically; to consider the costs and possible drawbacks of the system and to seek to improve them so far as possible. That is what our amendment does. It is not a wrecking amendment. It cannot be claimed in any way that it criticises the principle of the community charge. It draws the attention of the House and the public to the enormously greater costs which will be involved in the administration of our local government finance system. It suggests that it should be the Government's responsibility to pay a larger proportion than is now proposed.
I should like to remind the House that the legislation has been introduced in a most unusual way. The Government have looked at local authority expenditure and have concluded that it is too high and ought to be diminished. They have also concluded that local authority expenditure is too high because not enough people pay the costs of that expenditure. Their solution is to increase
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accountability by having more people pay the costs of expenditure and by knowing that they are paying it.
That is a political judgment which we have already debated and I do not intend to debate it again now. However, I must point out that when that judgment is put into effect we shall have a taxation system called the "community charge" which will break every single rule of taxation. That is because it is the intention of the system that it should be conspicuous and that everyone should know that they are paying; whereas all the principles of taxation state that, so far as possible, one should try to have one's taxes levied without people noticing them. That is the effective way both to reduce the resistance to taxation and to obtain the highest possible return. The principle which the Government wish to impose on us states that the tax shall be collected in advance. That may have cash-flow advantages; but it breaks many of the rules of taxation which state that one collects the money only when one needs it.
The community charge has as a principle that it is collected from more people. Taxation priciples state that it is most efficient to collect a tax from as few people as possible in as large amounts as possible because by doing so the administration costs are lower and fewer people are antagonised by the tax. Above all, it is clear from the Price Waterhouse Report—and it was even clear from the Government's original misleading estimates—that per £100 gathered this tax will be much more expensive to collect. That is the true measure of the efficiency of a tax. It is not the unit cost, the cost per item on the register, or whatever; it is per £100 collected. This tax will rank with the worst taxes ever to be imposed on the British people. It is far more expensive to administer than income tax; far more expensive than the rates; far more expensive than value added tax: and far more expensive than inheritance tax or corporation tax, per £100 collected.
That is the judgment which we must make on the system. It must be a cool and collected judgment on the system because, for political reasons, it is being deliberately imposed by the Government. On every judgment that one makes on taxation this tax fails. It calls into question the good judgment of the Government in imposing it in the first place. It sounded very simple—did it not?—when we first heard about it. We were told that it will be a single amount collected from everyone on an equal basis. There will be no difficulty in calculating it and no difficulty in understanding it. That will be the great virtue of the community charge, as put forward by the Government last year. Any noble Lords who have sat through the Committee stage or the Report stage so far, or who have paid any attention to the debates in another place, will realise that we have moved a long way from the simple proposition originally put forward. We have a complicated tax, an unjust tax and an expensive tax. In the amendment we modestly suggest that slightly more—not all—should come from the central government exchequer and not from the community charge payers.
I entirely reject the argument used by the Minister which was that it is breaking the principles of the

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allocation of the resource grant. The need to spend money on administration is as much a need of a local authority as the need to spend money on education, housing or social services. It is a tragedy that the Government are imposing a need which merely increases administrative costs and brings no benefit. I believe that this is a reasonable compromise approach to a problem which must be recognised and which will become clearly recognised if and when the tax comes into force. I do not believe that it would be right for me to withdraw the amendment, and I shall seek the opinion of the House.
5.47 p.m.
On Question, Whether the said amendment (No. 49) shall be agreed to?
Their Lordships divided: Contents, 75; Not-Contents, 113.

DIVISION NO. 2

CONTENTS

Addington, L.

Longford, E.

Airedale, L.

McIntosh of Haringey, L.

Amherst, E.

McNair, L.

Ardwick, L.

Molloy, L.

Aylestone, L.

Monson, L.

Bonham-Carter, L.

Morton of Shuna, L.

Bottomley, L.

Nicol, B.

Bruce of Donington, L.

Northfield, L.

Buckmaster, V.

Oram, L.

Carmichael of Kelvingrove, L.

Pitt of Hampstead, L.

Carter, L.

Ponsonby of Shulbrede, L. [Teller.]

Cledwyn of Penrhos, L.

Cocks of Hartcliffe, L.

Prys-Davies, L.

David, B.

Ritchie of Dundee, L.

Dean of Beswick, L.

Robson of Kiddington, B.

Dormand of Easington, L.

Rochester, L.

Elwyn-Jones, L.

Ross of Newport, L.

Ennals, L.

Seear, B.

Ewart-Biggs, B.

Sefton of Garston, L.

Falkland, V.

Serota, B.

Foot, L.

Shepherd, L.

Gallacher, L.

Stallard, L.

Graham of Edmonton, L.

Stedman, B.

Grey, E.

Stewart of Fulham, L.

Grimond, L.

Stoddart of Swindon, L.

Hampton, L.

Strabolgi, L.

Harris of Greenwich, L.

Tordoff, L. [Teller.]

Hatch of Lusby, L.

Turner of Camden, B.

Hayter, L.

Underhill, L.

Henderson of Brompton, L.

Vernon, L.

Houghton of Sowerby, L.

Wallace of Coslany, L.

Hughes, L.

Wells-Pestell, L.

Irving of Dartford, L.

White, B.

Jacques, L.

Williams of Elvel, L.

Jay, L.

Willis, L.

Jeger, B.

Winchilsea and Nottingham, L.

Kilbracken, L.

Listowel, E.

Winterbottom, L.

Llewelyn-Davies of Hastoe, B.

NOT-CONTENTS

Alexander of Tunis, E.

Brabazon of Tara, L.

Ampthill, L.

Brookes, L.

Arran, E.

Brougham and Vaux, L.

Bauer, L.

Broxbourne, L.

Beaverbrook, L.

Bruce-Gardyne, L.

Belhaven and Stenton, L.

Butterworth, L.

Beloff, L.

Caithness, E.

Belstead, L.

Cameron of Lochbroom, L.

Bessborough, E.

Campbell of Alloway, L.

Blatch, B.

Campbell of Croy, L.

Blyth, L.

Coleraine, L.

Boyd-Carpenter, L.

Colnbrook, L.

1746

Colwyn, L.

Mersey, V.

Constantine of Stanmore, L.

Mottistone, L.

Cork and Orrery, E.

Mountgarret, V.

Cowley, E.

Mowbray and Stourton, L.

Cox, B.

Munster, E.

Craigavon, V.

Murton of Lindisfarne, L.

Craigmyle, L.

Nelson, E.

Davidson, V. [Teller.]

Norfolk, D.

Denham, L. [Teller.]

Nugent of Guildford, L.

Dilhorne, V.

Onslow, E.

Dundee, E.

Orkney, E.

Elton, L.

Orr-Ewing, L.

Faithfull, B.

Oxfuird, V.

Ferrers, E.

Pender, L.

Ferrier, L.

Penrhyn, L.

Foley, L.

Peyton of Yeovil, L.

Fortescue, E.

Porritt, L.

Fraser of Kilmorack, L.

Portland, D.

Gainford, L.

Pym, L.

Gardner of Parkes, B.

Renton, L.

Geddes, L.

Renwick, L.

Halsbury, E.

Rochdale, V.

Hanson, L.

Russell of Liverpool, L.

Havers, L.

Selkirk, E.

Hesketh, L.

Skelmersdale, L.

Hives, L.

Somers, L.

Home of the Hirsel, L.

Strathclyde, L.

Hooper, B.

Strathspey, L.

Hylton-Foster, B.

Terrington, L.

Jenkin of Roding, L.

Teviot, L.

Kenilworth, L.

Teynham, L.

Killearn, L.

Thomas of Gwydir, L.

Kitchener, E.

Trafford, L.

Lawrence, L.

Trefgarne, L.

Long, V.

Trumpington, B.

Lucas of Chilworth, L.

Ullswater, V.

Lytton, E.

Vaux of Harrowden, L.

McAlpine of West Green, L.

Westbury, L.

Mackay of Clashfern, L.

Whitelaw, V.

Macleod of Borve, B.

Windlesham, L.

Mancroft, L.

Wise, L.

Marley, L.

Wolfson, L.

Marshall of Leeds, L.

Wyatt of Weeford, L.

Massereene and Ferrard, V.

Young of Graftham, L.

Merrivale, L

Resolved in the negative, and amendment disagreed to accordingly.
5.55 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 50:
After Clause 12, insert the following new clause:
("Transitional protection.
.—(1) A person falling within such category of income as may be prescribed by the Secretary of State and comprising those persons called upon for the first time to meet a financial liability for local taxation for whom the liability will cause hardship shall be subject to a charging authority's personal community charge on a tapering basis of 25 per cent. of the charge in the first year increasing annually by equal proportions to 100 per cent. of the charge in the fourth year from the date of introduction of the charge.
(2) Any income forgone by the charging authority as a result of the operation of subsection (1) above shall be reimbursed by way of revenue support grant payable to the charging authority.").
The noble Lord said: My Lords, I suggest that Amendment No. 50 is not in any way a destructive or wrecking amendment but is one which looks at the facts; namely, that the community charge, as the Government claim, will affect many people who have never been directly affected by local authority financing and taxation.
We have argued that many more people than pay the rates bill know that they are contributing to local authority taxation; but it is true, as the Government

1747
have always claimed, that they have not paid it directly. They may have had it paid via another member of the household or as part of the council rent. Therefore, in the light of the fact that there will be a new financial responsibility for a very significant number of people, we suggest that there should be a transitional period of four years. Where the new tax will cause hardship, it should be introduced gently for those individuals.
This is rather different from the transitional proposals in Part IV of the Bill which we may have an opportunity to discuss this afternoon without waiting until Monday. Our amendment is confined to those individuals who will suffer hardship due to being exposed to the community charge for the first time. We believe that this may decrease the unpopularity of the community charge and might be to the electoral benefit of the Government if this amendment were introduced. That is not our main reason for bringing the amendment forward, but we sense that there could be not only a feeling of injustice but actual hardship for perhaps a limited number of people—and I do not know how many. We should like the Government sympathetically to consider whether some way could be found—and perhaps this is not exactly the right way—to meet that very justifiable need. I beg to move.
The Earl of Caithness: My Lords, I give full credit to the noble Lord, because this amendment is deceptively simple. However, if implemented I suspect that it would cause many more problems than it would solve. Perhaps I may give your Lordships an example. It refers to individuals who are caused hardship but does not indicate how the proposal for a 25 per cent. payment in 1990 would relate to the rebate system under which 4 million individuals will be paying only 20 per cent. of the charge in 1990. How would they be dealt with? Nor do we accept that hardship will be caused. Even those on maximum rebates will have the 20 per cent. payment reflected in their income support.
Moreover, the amendment seems to envisage a static society. An individual on a low income who is not a ratepayer in 1989 will receive special transitional protection for four years. However, that individual may well obtain a well paid job shortly after the community charge comes in or he may stop living with his parents and buy a home of his own on 1st April 1990. Is he then to be more favourably treated for several years simply because of his personal circumstances on 31st March 1990?
The Government are committed to provide transitional protection for people in areas where the community charge would be higher than contributions from domestic rates. That safety net power is Clause 102. We believe that that is the right way to cushion the impact of the new system. As regards people on low incomes, we shall be providing rebates. These will apply to all those people who are on low incomes—young and old, householder and non-householder—and they will be a permanent feature of the new system, not just for the first few years.
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I accept that there will be people who were not previously ratepayers but who will be asked to pay the community charge in 1990. I do not apologise for that. Indeed, it is central to the Government's proposal for increasing accountability that those 17 million non-ratepayers should make a direct contribution. Many of those people are in employment. The payments they make will help to reduce the bills faced by millions of single pensioner households.
The noble Lord's amendment contains a number of serious flaws. The Government believe that their proposals, temporarily through the safety net and permanently through the rebate system, provide the protection which I am sure he seeks and which we are providing in the Bill.
6 p.m.
Lord McIntosh of Haringey: My Lords, I confess I am surprised that the Minister should call in aid Clause 102. Indeed, it is true that Clause 102 provides that the Secretary of State has the power, which is called a safety net, to introduce grants for a transitional period to cushion the blow to local authorities of the change in the financing system. However, the grants are made to the local authorities and, therefore, in so far as they affect the community charge, they affect the community charge for all, rich and poor, whereas we are proposing a direct recognition of the problems of individuals who are in hardship. That is a very different proposition.
I suggest that our amendment is much more in accord with Conservative philosophy than is Clause 102, which is broadly based and covers both rich and poor within a given local authority area. On those grounds alone I am tempted to pursue the amendment to expose the difference between us on this matter. However, I accept that there are drafting difficulties in my amendment and that it is right I should take it away to see whether we can find a better way of giving expression to our objectives. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 13 [Relief for Students]:
[Amendment No. 51 not moved.]
Baroness Robson of Kiddington Baroness Robson of Kiddington moved Amendment No. 52:
Page 9, line 46, at end insert—
("( ) If a person is undertaking a course of nursing education on each day of that period, the amount he is liable to pay under this section shall be determined by order, no such amount being less than one-fifth of the amount it would be apart from this section.").
The noble Baroness said: My Lords, in moving this amendment I speak also to Amendments Nos. 125 and 126. Your Lordships will remember that in Committee I moved an amendment to include nursing students in the provisions which entitle students to an 80 per cent. discount on the community charge. At that time I said I was confident that the Government would agree. It is obvious from the very short speech I made in introducing that amendment that I was convinced no government could refuse to accept it. However, it did not turn out

1749
to be so and the amendment was defeated. Therefore, I now introduce an amendment which gives the Secretary of State discretion to determine by order the amount of discount to which student nurses will be entitled.
In the debate in Committee the problems of the overlap of six months in England and 18 months in Scotland between the introduction of the community charge and Project 2000 were highlighted. We know that the community charge will be introduced in 1990 in England and Wales, but we are not as yet at all sure whether Project 2000 will be ready to be introduced in 1990. There are certain aspects of this overlap, this difference in timing, which were not brought out in Committee.
All of us realise that to introduce Project 2000, which is a major change in the student nurse education, will take some time. One cannot envisage that in the build-up to the introduction of Project 2000 for some time we will stop the training of student nurses. Therefore, inevitably there will be student nurses who start their training in the autumn of 1989 or the spring of 1990. It is unlikely that, having started that training, they will be able to switch to the new type of training under Project 2000. Therefore, there will be many student nurses in England, for example, who start a course of training in the autumn of 1989 and will be staying on the old system of nurse training and presumably will not be entitled to the 80 per cent. rebate on the community charge. This also means that if nurses start in 1989 they will be paying the full charge for 27 months until their course finishes after the introduction of the community charge in 1990.
The position is even worse in Scotland. A student nurse starting in the autumn of 1989 will be liable to pay the community charge in full and will have to do that for the full three years of training. That will mean that there could be the anomaly that nurses who start their training in 1989 under the old system of training will be paying 100 per cent. of the community charge up to 1992. If Project 2000 is introduced in the autumn of 1990, those students who start under the new system will be paying only 20 per cent. of the community charge. That is an anomaly which the Government must seriously consider.
There is another aspect that worries me. Under Project 2000 nurse education will be linked more closely to higher education and the contribution by nurses to hospital manpower will be cut from 80 per cent. to 20 per cent. They will be paid by a non-means-tested bursary. However, I cannot envisage that this reduction from 80 per cent. to 20 per cent. will take place just like that. It is very likely, with the present shortage of staff in the hospital service, that health authorities will insist that this contribution by student nurses to hospital manpower will be reduced gradually over a period of years. I do not know, and I have heard nothing to tell me, how and at what point, even after Project 2000 is introduced, the nurses become entitled to an 80 per cent. reduction in their community charge.
I know that many of these problems are speculative. All that we know for certain is that the Government have committed themselves to the
1750
Project 200 reforms, but we do not know exactly when they will be introduced and we do not know exactly at what point the nurse will be entitled to an 80 per cent. rebate.
Clearly this amendment is less desirable than the amendment I moved in Committee, but it gives the Secretary of State discretion to act to alleviate the position for nursing students. He will be able to judge the problems as they come forward in the development of Project 2000 after the introduction of the poll tax. If this amendment finds favour with the Government and with this House, the Secretary of State will hopefully use it to minimise the differential between students and student nurses. I beg to move.
Baroness Cox: My Lords, in speaking in support of these amendments it seems to me that there are three kinds of arguments that can be briefly put forward. The arguments are the principles in the amendments, professional considerations and political considerations. The principles in the amendments have been very fully and lucidly explained by the noble Baroness. Therefore perhaps I may briefly highlight the professional and political considerations.
It is absolutely essential not to underestimate the seriousness of nursing recruitment. Traditionally, nursing has been taking a quarter of the girls leaving school with the appropriate qualifications. With the falling numbers of pupils leaving schools, in theory the profession would need to take half the number of school-leavers with the appropriate qualifications if it is to maintain the current levels of recruitment, training and staffing in the National Health Service. Clearly it is not possible to do that, especially as there are so many good career opportunities available for school-leavers. Therefore there is great competition for well-qualified recruits to a wide range of professions and occupations. Nursing must be able to compete not only in attracting school-leavers but also in attracting other categories of recruits including more men and mature students.
Unless nursing can do this the current crisis in the National Health Service caused by shortages of staff will become exacerbated to perhaps the point of a possible breakdown in the provision of certain services. It was said by my noble friend the Minister at the Committee stage that student nurses were well-off compared with other students who are on grants. Once the deductions are made, student nurses are not so very much better off. It is important to remember that they work extremely hard and carry very heavy responsibilities. Therefore, the life of a student nurse is not like that of other students. It is not comparable.
There is another point which was not made before or recognised; namely, that many student nurses do not receive entitlement to advantages which are enjoyed by other students such as free banking services. They have quite a few disadvantages which were not previously recognised. It is a general perception that nurses have received significant pay awards. That is both true and highly welcome for qualified nurses and is much appreciated. However, student nurses received only 6 per cent. of what was already a low salary. It is important not to see them as part of the overall and very generous pay award.

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Perhaps I may raise a brief point of political consideration which it is not inappropriate for me to make from this side of your Lordships' House. The Government received and deserved great popularity with the profession and the public for the measures that they have recently taken as regards nursing. They were principled and much-needed professionally.
I hope that my noble friend understands that it will be an enormous pity to lose good will and this well-deserved popularity by pursuing a cheeseparing policy as regards student nurses, especially without good arguments. I did not find his arguments convincing at Committee stage. It is one thing to be unpopular for good reasons and because one is adhering to certain principles, but I suggest to him that it is politically inept and inexcusable to become unpopular without good reason. I hope that my noble friend will respond sympathetically to these amendments.
6.15 p.m.
Lord Morton of Shuna: My Lords, my name is on these amendments and I shall not take up your Lordships' time for very long. We have had two very able speeches so there is very little for me to add. It seems indicative of what happened that perhaps there was no consultation between the Department of Health and Social Security, which took a quite proper attitude to nurses by changing them to students, and the Department of Education and Science. No thought was given to how this was to be done. Surely the only fair way is to call student nurses "students" from now on. With a predicted shortfall of at least 3,000 recruits for nursing in England and Wales—I am very carefully not mentioning Scotland—by the year 1990, it is daft for the Government not to give effect for this amendment.
Lord Trafford: My Lords, I support this amendment because it seems that it has two points very much more in its favour than the amendment discussed at Committee stage. First, it is not asking the Government to do anything specific at this time and neither is it asking them to grant to student nurses (on the basis of being student nurses) any particular relief. At the Committee stage the point was made that student nurses earn a certain salary and that many other people do not earn greater salaries yet they have to pay the community charge.
In this amendment that situation does not arise. Therefore I believe that one can support it even more strongly because it seems to be what one might call a more reasonable amendment. It is one that says in effect "We are heading for trouble; we can see trouble at least 18 months ahead"—there is some trouble now—"We know that there is confusion between Scotland, in which this measure will be implemented earlier, and in England". I remember that I made a slight joke about that last time when I suggested that the fact that it was implemented in Scotland a year early would definitely help the nursing problems of England for a short time. However, it does not alter the more serious point; namely, that there will be a distinct difference in the charges made to nurses
1752
north of the Border as opposed to those south of the Border for a considerable period of time.
In addition, the confusion was ably described by the noble Baroness, Lady Robson, and by my noble friend. There will be confusions of transition from the present method of student nurse training (which is an apprenticeship system where they are employees and mostly in service) to the time when they become students of higher education when they are treated, certainly initially, as ordinary undergraduates. Though we have received a concession from the Government that when nursing students are fully accepted into this scheme they will become liable for the rebate, they will not be liable in the intermediate period. However, it has been said on more than one occasion in this House that it takes time to introduce this new kind of education system and it creates confusion.
That is one good reason for suggesting that we give the Secretary of State powers to deal with the situation that can be seen coming by anyone who is not blind. There is another compelling reason that I would urge upon my noble friend the Minister. One should not create an organisation to which one wishes to recruit staff and then ruin all the recruiting posters by saying "If you come I cannot actually tell you what you will be paid, what taxes you will be liable to and what advantages and disadvantages you will have, but I can tell you not to train in Edinburgh between 1989 and 1991 for certain, and maybe not in Birmingham, London, Brighton or wherever it may he after 1991 and until 1994". As we have heard from my noble friend Lady Cox, we are already somewhat short of young nurses. Owing to demographic change, of which everyone is aware and which has been discussed in other connections, we need to recruit 50 per cent. of that age group of young women during the period up to 1995 if we are to recruit at the same rate.
We have a recruiting problem already. Are we to complicate it further? I do not see any reason why we should do that. If I see a runaway car hurtling towards me down the road, with disaster staring me in the face, I should be a fool if I did not take evasive action, especially if I was given plenty of warning. I urge my noble friend to take note that the Government have been given adequate warning both at Committee stage and now with a more reasoned amendment at this stage. For both those reasons, as well as for the reason of natural justice which was also raised, I sincerely hope that my noble friend will at the very least agree to look at this matter again in view of the complications, but preferably to agree to the amendment.
The Earl of Halsbury: My Lords, in rising to support the amendment of the noble Baroness, Lady Robson of Kiddington, and the extremely useful contributions of other noble Lords, I have an interest to declare. My granddaughter is a student nurse at the Westminster Hospital. In so far as we have a special arrangement with the Westminster Hospital, I must warn noble Lords that if in the heat of debate they become over-excited and have an epileptic fit, a coronary thrombosis or a stroke, they are liable to suffer from her ministrations. Having declared that

1753
interest I must to some extent withdraw it because she is in her third year and will not be affected by the provisions after 1989.
I have a cautionary word to say to the noble Earl who is to reply for the Government. Every time the Government have gone down on the two major Bills that we have been considering for so many weeks, it is because they have been obdurate and defiant in the face of the growing opinion of this House which, sitting on the Cross-Benches, I can feel piling up. I beseech the noble Earl to respond to what his noble friend Lord Trafford has just said and be accommodating on this point. The nursing profession is a popular one. At some time or other we have all been dependent on them. We do not want to see nurses or student nurses underpaid or hardly treated. We do not want to see anomalies between student nurses in Scotland and student nurses in England and Wales. I beseech the noble Earl to be a little pliable in a matter of this kind.
Lord Auckland: My Lords, throughout the country schools are being visited by nursing officers seeking to increase the ratio of student nurses. It is certainly true in my area of Surrey where I am president of the friends of my local Epsom District Hospital. Quite frequently students, and especially sixth-form students, visit the hospital or have lectures on the nursing profession. As has already been said by my noble friend Lady Cox, who is especially knowledgeable on these matters, there is a considerable shortage of student nurses.
We can all indulge in special pleading. My younger daughter is now a staff nurse and will not he directly affected by the amendment. However, we have to look to the future. Student nurses are not in the same category as ordinary students. They have to carry out responsibilities far beyond the requirements of students of, say, chemistry, architecture and so on. Many noble Lords will know that student nurses, especially those in long-stay hospitals, have to take complete control of a ward if only for a short time. That is an enormous responsibility for any young person. I join the pleas to my noble friend to look carefully at this all-party amendment. I have just been to a reception given by the Royal College of Nursing. It is one of the most responsible bodies in this country. Whenever it makes a plea, it is a responsible one. If only in deference to that fine body, the Government should give serious consideration to this amendment.
Baroness Faithfull: My Lords, I shall not repeat what has been so wonderfully said by other speakers. I rise to support the amendment.
The Earl of Perth: My Lords, a year ago—it seems like a long time—we were considering the community charge for Scotland. At that time I led a compaign to have overseas students released from 50 per cent. of the liability. A remarkable thing happened. Instead of that 50 per cent., the Government agreed to 20 per cent. for all students. The generous action of the Government at that time is one of the happiest things I can remember.
1754
When I listened to the speeches today I was moved to say to the Government that they should consider acting similarly in this case. We all realise, first, that the name is "student nurses". Secondly, the student nurses earn money. Is that a reason why they, almost alone of all the students, should not get the relief which others are to get? Having heard all the health reasons, the need for hospitals to have recruits and so on, I beg the Government to consider accepting the amendment or something similar which gives the effect that we all want.
Lord Hesketh: My Lords, I confess that 1 am just a little surprised that the House is having a repeat of the debate it had on the same issues at Committee stage. On that occasion, the relevant amendment was pressed to a Division and defeated.
As I confirmed on that occasion, the Government have indicated that they intend to accept many of the recommendations of Project 2000, including the proposal that student nurses should receive nontaxable bursaries instead of salaries. Assuming that the qualifying conditions concerning supervised study and similar matters are met, student nurses will then automatically become students for the purpose of the personal community charge and eligible for the 80 per cent. relief under Clause 13. It may be of assistance if I say that Amendments Nos. 125 and 126 are not necessary to allow this to happen. The regulation-making powers in Clause 28 are already wide enough to ensure that student nurses will become students for these purposes when Project 2000 is implemented.
The detailed implementation of Project 2000 is a matter for my right honourable friend the Secretary of State for Social Services. I understand, however, that implementation may well begin within the next 18 months but is then likely to proceed in stages.
In Committee on 6th June I argued—and on a Division the Committee accepted—that we should not extend the student relief to student nurses until Project 2000 was implemented. Until that time, student nurses will remain salaried employees, paid on a scale rising to £6,783 this year in London. Part of their time will be spent training; but in that respect they will be in the same position as others undertaking on-the-job training for a trade or profession. The implementation of Project 2000 will be the watershed. Thereafter, as the Secretary of State for Social Services has made clear, the whole nature of student nurses' training will alter; and they will receive bursaries, not salaries. When that point is reached and student nurses become students, it will be appropriate to give them the 80 per cent. relief from the community charge. Indeed, as I have already said, that will happen automatically, assuming the qualifying conditions are met. What in the Government's view is not acceptable is to jump the gun and apply Clause 13 to student nurses in advance of Project 2000.
Part of the problem in today's debate is in a way caused by the arrival of Project 2000 at the same time as this Bill. I am sure that my noble friend Lady Cox will agree when I say that Project 2000 has nothing to do with the Bill as such. The difficulty, as I see it, is summed up by the new system and the old system.

1755
The real problem is that one group of people has not been mentioned at all. I refer to all the contemporaries of student nurses—many millions of them—who are earning around three times as much as ordinary students and will be expected to pay the community charge. They might feel that there was an anomaly that while they should be expected to pay the community charge, the student nurse earning £6,700 per annum, and before the introduction of bursaries and her acceptance as a full-time student, should not.
I am afraid that my remarks today have been similar in content to those contained in my speech on 6th June when we debated these matters in Committee. On that occasion at col. 1200 the noble Baroness, Lady Robson, said that she had,
"never been so disappointed by a reply".
If she is equally disappointed today, I can only say that I have at least been consistent. I ask her to accept that what I am offering is in fact very good news for student nurses and that the implementation of Project 2000—which itself has been welcomed by the nursing profession—will in due course also lead to student nurses gaining an 80 per cent. reduction in their community charge.
Lord Trafford: My Lords, before my noble friend sits down, perhaps I may ask him a question on this point. I do not think that he addressed himself to the fact that this amendment is different to the one moved in Committee. This is an enabling amendment with discretionary powers to avert the possibility of a particular situation arising; it does not contain a request as did the amendment which was moved in Committee.
Lord Hesketh: My Lords, I fully appreciate what my noble friend said, but I feel that I have tried to answer him and I can say no more than I have already.
Baroness Cox: My Lords, before my noble friend sits down for the second time, would he agree that the figure he has just given us is by no means typical of student nurses' salaries and that it is in fact at the top end of the scale in London, taking into account the London allowance? It is certainly not what the average student nurse receives, which is very much less.
Lord Graham of Edmonton: And he knows it!
Lord Hesketh: My Lords, I gave the figure as a1n example against the higher figure for a student grant as a proportional equivalent. I believe that the noble Baroness will find it to be accurate.
Baroness Robson of Kiddington: My Lords, I was disappointed in Committee but I am open-mouthed at the reply which I have just received from the Minister. First, he referred to a repetition of the debate on the amendment in Committee taking place now on Report. There is no similarity between the amendment we have just discussed and the one moved in Committee. We have introduced it to try to
1756
get the Minister and the Government to agree to some kind of assistance for student nurses.
We would rather have had the amendment we introduced in Committee, but this, at least, will enable a compassionate Secretary of State to help look after nurses. Reference was made to the income of nurses, comparing it with that of students. Students do not work 52 weeks of the year and they have plenty of time to go out and earn money during the vacation period. They have all kinds of possibilities. Student nurses work so hard that they cannot do anything more to augment their income.
I am delighted to have the support of the noble Lord, Lord Trafford. I am also delighted that so many Members on the Government Benches can see the difference between this amendment and the one we moved in Committee. I am afraid that under the circumstances I must press the amendment to a Division, and I hope that the House will support me.
6.34 p.m.
On Question, Whether the said amendment (No. 52) shall be agreed to?
Their Lordships divided: Contents, 85; Not-Contents, 65.

DIVISION NO. 3

CONTENTS

Addington, L.

Lytton, E.

Airedale, L.

McIntosh of Haringey, L.

Ardwick, L.

Macleod of Borve, B.

Auckland, L.

McNair, L.

Avebury, L.

Massereene and Ferrard, V.

Aylestone, L.

Monson, L.

Beloff, L.

Morton of Shuna, L.

Bonham-Carter, L.

Moyne, L.

Broxbourne, L.

Nicol, B.

Bruce of Donington, L.

Oram, L.

Buckmaster, V.

Orkney, E.

Carmichael of Kelvingrove, L.

Penrhyn, L.

Carter, L.

Perth, E.

Cledwyn of Penrhos, L.

Pitt of Hampstead, L.

Cox, B. [Teller.]

Ponsonby of Shulbrede, L.

Craigavon, V.

Prys-Davies, L.

David, B.

Renton, L.

Dean of Beswick, L.

Ritchie of Dundee, L.

Donoughue, L.

Robson of Kiddington, B. [Teller.]

Dormand of Easington, L.

Ennuis, L.

Rochester, L.

Ewart-Biggs, B.

Ross of Newport, L.

Faithfull, B.

Russell of Liverpool, L.

Falkland, V.

Seear, B.

Foot, L.

Seebohm, L.

Gallacher, L.

Serota, B.

Graham of Edmonton, L.

Shepherd, L.

Grey, E.

Stedman, B.

Halsbury, E.

Stewart of Fulham, L.

Harris of Greenwich, L.

Stockton, E.

Hatch of Lusby, L.

Stoddart of Swindon, L.

Hayter, L.

Strabolgi, L.

Hylton-Foster, B.

Swinfen, L.

Irving of Dartford, L.

Tordoff, L.

Jay, L.

Trafford, L.

Jeger, B.

Turner of Camden, B.

Kilbracken, L.

Underhill, L.

Killearn, L.

Vaux of Harrowden, L.

Kinloss, Ly.

Wallace of Coslany, L.

Lawrence, L.

White, B.

Listowel, E.

Williams of Elvel, L.

Llewelyn-Davies of Hastoe, B.

Willis, L.

Longford, E.

Wise, L.

1757

NOT-CONTENTS

Arran, E.

Home of the Hirsel, L.

Beaverbrook, L.

Hooper, B.

Belhaven and Stenton, L.

Jenkin of Roding, L.

Belstead, L.

Kitchener, E.

Bethell, L.

Lindsey and Abingdon, E.

Blatch, B.

Long, V.

Brabazon of Tara, L.

Lucas of Chilworth, L.

Brookes, L.

McAlpine of West Green, L.

Brougham and Vaux, L.

Mackay of Clashfern, L.

Bruce-Gardyne, L.

Mancroft, L.

Caithness, E.

Marshall of Leeds, L.

Cameron of Lochbroom, L.

Merrivale, L.

Campbell of Alloway, L.

Mottistone, L.

Campbell of Croy, L.

Mowbray and Stourton, L.

Coleraine, L.

Munster, E.

Colwyn, L.

Murton of Lindisfarne, L.

Constantine of Stanmore, L.

Nelson, E.

Cork and Orrery, E.

Onslow, E.

Cowley, E.

Pender, L.

Craigmyle, L.

Peyton of Yeovil, L.

Davidson, V. [Teller.]

Redesdale, L.

Denham, L. [Teller.]

Renwick, L.

Dilhorne, V.

Skelmersdale, L.

Dundee, E.

Stevens of Ludgate, L.

Ferrers, E.

Strathclyde, L.

Ferrier, L.

Teynham, L.

Foley, L.

Thomas of Gwydir, L.

Fortescue, E.

Trefgarne, L.

Fraser of Kilmorack, L.

Trumpington, B.

Hanson, L.

Ullswater, V.

Havers, L.

Windlesham, L.

Hesketh, L.

Young of Graffham, L.

Hives, L.

Resolved in the affirmative, and amendment agreed to accordingly.
6.41 p.m.
Clause 14 [Standard community charge]:
Lord Hesketh Lord Hesketh moved Amendment No. 53:
Page 10, line 9, leave out ("sub-paragraph") and insert ("paragraph").
On Question, amendment agreed to.
Clause 16 [Joint and several liability: spouses]:
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 54:
Page 1, line 15, after ("to") insert ("or lives with as if they were husband and wife").
The noble Lord said: My Lords, I am speaking also to a group of amendments that consists of Amendments Nos. 54 to 59 and 61. Amendment No. 54 is a purely drafting amendment. In six or seven lines the Scottish Act deals with the joint and several liability of people who are married or who are living together:
"Persons who

(a) are married to each other and live together; or

(b) being a man and a woman, live together as if they were husband and wife,

shall be jointly and severally liable for the personal community charge.".
The Bill manages to take just about a whole page to deal with the same point. If and when the Minister moves Amendment No. 60, he will have got Clause 16 into at least a full page of print. I wonder why that is necessary.
The amendment is aimed at subsection (7) which was commented upon during the clause stand part debate in Committee. It reads, taking it shortly, that for the purposes of that clause people are married to
1758
each other if they are a man and woman who are married to each other or who are not married to each other. There was a certain difficulty in defining people who were married to each other as being people who were, on definition, not married to each other. It is to try to correct that apparent difficulty that the amendments are put forward.
Amendment No. 61 is the main amendment in which I suggest an alteration to subsection (7) to say,
"For the purposes of this section, people are jointly and severally liable where they are persons who are (a) married to each other and live together or (b) being a man and woman, live together as if they were husband and wife."
That is a simpler and more easily understood way of putting the matter. To adopt the words of the noble Lord, Lord Boyd-Carpenter (who I am sorry to see not in his place) it is a more appropriate and more decent way of describing the situation.
To take the words in the Bill, to describe people who are living together as married people when they are not is absurd. To go through the whole clause providing a "person is married to a person ( the spouse)" and then to discover at the bottom of the clause that one does not need to be married, but if you are living together on a day you have joint and several liability, is absurd. Amendments Nos. 54 and 59 are an attempt to clear up that matter by making the provision more straightforward. If I had not been engaged on another Bill, which has taken up a great deal of your Lordships' time, I might have had a shot at trying to shorten Clause 16 more radically. The amendments make the sense rather more decent. I beg to move.
6.45 p.m.
The Earl of Caithness: My Lords, I should like to respond to the noble Lord, Lord Morton of Shuna, in two stages: first, on the policy intention underlying Clause 16, and the equivalent Scottish power; and, secondly, on the question of the words used in the clause.
So far as the policy is concerned, I can confirm that the position under the Bill will be the same as under the Scottish Act so far as the personal community charge is concerned. Married couples, and couples who are not married but are living together as husband and wife, will be jointly and severally liable for the charge during the period that they are living together.
Clause 16 takes more words to secure this outcome than does the equivalent provision—Section 8(7)—of the Scottish Act. That is partly a reflection of the fact that the personal community charge in England and Wales is specifically set up on the basis of daily liability, whereas the same is not true of the Scottish Act. That means, for example, that Clause 16 deals with part years' liability more explicitly. Your Lordships will recall that this is territory that we went over to some extent yesterday.
In addition, the Bills were drafted by different draftsmen. As many Members of your Lordships' House will be aware, Scottish legislation is produced by separate draftsmen within the Lord Advocate's Department. That in turn reflects the fact that Scottish law is different in many respects from that applying south of the Border.

1759
Inevitably, different draftsmen will choose somewhat different ways of conveying the meaning that is required. That will be particularly so where, as here, we are dealing with Scottish and English law; and where there is a slightly different approach to the way liability for the charge is established in the two pieces of legislation.
As someone who is not a lawyer, I have always been extremely circumspect about implying that I might be able to draft legislation better than parliamentary counsel. The noble Lord, Lord Morton of Shuna, as a lawyer, obviously feels less constrained. However, the remarks he has made, it seems to me, are directed not towards the meaning of Clause 16, but purely to the way the result is achieved.
Much the same point was raised during consideration of the Bill in another place, and an amendment was put forward to alter the wording of the clause. My honourable friend the Minister for Local Government—whose views I commend as a fellow Queen's Counsel to the noble Lord—said in response:
"I agree that the formulation used … that 'married' for these purposes includes couples who are not married, but who are living together as husband and wife—is a little unusual. But the meaning is absolutely clear. The amendment would not change the sense in any way and I am not inclined to accept amendments to add unnecessary words to the Bill".—[Official Report, Commons Standing Committee E, 16/2/88; col. 743].
Finally, I venture to suggest that the noble Lord's amendments could make the clause less clear than it is now. The noble Lord made fun of the drafting of the Bill as it now is, but Clause 16(1)(b), for example, would, if the noble Lord's amendments were accepted, read:
"On any day in the chargeable period the chargeable person is married to or lives with as husband and wife a person (the spouse or other person) who is aged 18 or over on the day."
The redrafting produces two linked pairs of criteria. Despite the skill that the noble Lord, Lord Morton of Shuna, undoubtedly has, I suggest that there seems to be some room for dispute as to which of those pairs are to be taken together, or how they relate to each other. The conclusion I draw is this: the existing drafting is clear, and secures the policy intention. We need to have a very good reason before we change the drafting simply for its own sake. I do not think that there is good reason, especially if, as I rather fear, the suggested revised wording might be capable of misinterpretation.
Lord Morton of Shuna: My Lords, I am much obliged for that very careful answer. What baffles me about this whole Bill relating to the community charge is that after both Houses of Parliament had in effect gone through a community charge Bill in 1987 drafted by the parliamentary draftsman and revised with all the skill of this House and the House of Commons and passed into force as an Act, the parliamentary draftsman drafting the Bill now before us did not start with the Scottish Bill as his framework and go along from there, changing it as necessary for English law. The noble Earl will be well aware that if two pieces of legislation covering the same subject are worded differently, the courts will
1760
assume that the meaning is different. So one can foresee a wonderful argument turning up in court in England—thank goodness!—where somebody will come along and say, "Ah, but look at the Scottish section which Parliament passed the previous year. It said this; it is different: therefore Parliament must have meant it to be different and therefore there is some difference."
I do not wish to press this. If the Government intend to proceed with something as chaotic as Clause 16, I can only say that I have made an attempt to try and clear it up. The Government have had the encouragement of the noble Lord, Lord Boyd-Carpenter, pointing out that some words I have suggested are more decent and appropriate. If the Government choose to ignore that, then there is the proverb which says something about those whom the gods wish to destroy. However, at this stage, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 55 to 59 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 60:
Page 11, line 37, at end insert—
("(6A) In a case where—

(a) the chargeable person and the spouse are jointly and severally liable to pay an amount by virtue of this section,

(b) the chargeable person fails to pay all or part of it because of wilful refusal or culpable neglect, and

(c) the spouse accordingly pays an amount to the authority, the spouse may recover from the chargeable person an amount equal to the amount paid by the spouse to the authority.

(6B) Subject to subsection (6A) above, the spouse may not recover from the chargeable person anything by way of contribution to any amount paid by the spouse to the authority by virtue of this section.").
The noble Earl said: My Lords, this is a clarifying provision which, I am sure, will be welcomed on all sides of the House and in particular by the noble Lord, Lord Morton of Shuna. Your Lordships will be aware that under Clause 17(8), where a managing agent has to pay a collective community charge on behalf of a landlord, by virtue of joint and several liability, the managing agent may recover the sum from the landlord. There is, however, no similar provision under Clause 16 for recovery as between husbands and wives or persons living together as husband and wife. The Government have taken the view that there should be such provision for the avoidance of doubt.
In deciding the form that this recovery provision should take, we have paid considerable attention to the views expressed in your Lordships' House at an earlier stage. Noble Lords will recall that joint and several liability was devised so that where one partner—perhaps a non-working wife—has no money of her own, the other partner should pay her charge. It is not the intention that the non-working wife should be pursued for the community charge of a working husband, nor do I believe that charging authorities will apply joint and several liability in that way.
At an earlier stage I assured your Lordships' House that in the Government's view charging authorities could be relied upon to act responsibly in applying joint and several liability. This amendment

1761
backs up our belief by giving a very clear signal both to charging authorities and to the partners of nonworking wives.
The amendment provides that where a person fails to pay the community charge because of wilful refusal and culpable neglect and the partner has to pay it on his or her behalf, then the partner who actually pays may recover the amount in question from the partner who failed to pay. It also provides, however, that where a person fails to pay the charge and there is no wilful refusal or culpable neglect, then the partner who actually pays cannot recover the amount in question.
It may make matters somewhat clearer if I remind your Lordships that in lay terms failing to pay because of wilful refusal or culpable neglect means that a person had the money, could have paid, but either chose not to do so or failed to do so deliberately. If a person fails to pay, but there is not wilful refusal or culpable neglect, then it is likely to be because the person simply did not have the money with which to pay.
In other words, if a working husband has to pay the charge on behalf of his wife and the wife has no money of her own, then the husband cannot recover the money from his wife. If on the other hand a non-working wife has to pay the charge on behalf of her working husband, then the wife may recover the money from her husband. I hasten to add that in practice we do not expect that a non-working wife will have to pay her husband's charge. But this provision is useful because it gives a clear signal, as I have said, that joint and several liability is to be invoked in favour of women who have no income of their own, not against them. I beg to move.
Lord Morton of Shuna: My Lords, this shows that the Government really have gone completely off their heads. Can I have an assurance that neither this amendment nor anything like it will be introduced into the Scottish Act and that there will not be the comparative amendment? This amendment appears to provide—it does not say anything about the recovery provisions so I suppose it is the same as we had before—that if somebody pays their partner's poll tax, they go to the magistrates' court and say, "Jeannie was wilfully refusing to pay. Please put her in prison." It does not seem to me that this does much for restoring the Victorian values of family life, if there were any.
I do not see what the Government are about in this case. Are they really setting out to increase the work of the divorce courts? Can one really imagine setting out in a case where people are married to each other and giving a right to recover from the other partner by establishing that the person was wilfully refusing to pay or did not pay by culpable neglect? There are occasional arguments in family life as to where the money is to go. But this does not seem to me something which will decrease those arguments.
I have seldom seen anything that I could regard as so plain silly as this amendment, quite apart from the fact that by the time this occurs one would imagine that the parties had ceased to live together and their joint and several liability had flown away long ago. It
1762
would never have happened. Can the Minister explain to me where this will happen with people still having a joint and several liability? It seems to me plain idiotic.
Lord Swinfen: My Lords, I wonder whether my noble friend could confirm that a husband is responsible for his wife's debts. Is this not a case of the law as it stands by common law in any case? I wonder why it is necessary to put it in the Bill.
The Earl of Caithness: My Lords, I am terribly disappointed that the noble Lord, Lord Morton of Shuna, could not give such a reasonable amendment a more glorious welcome.
On the first point that he raised—whether it would be translated into the Scottish Act—of course I shall discuss this matter with my right honourable friend the Secretary of State for Scotland. In due course he will decide whether it is necessary. But he will bear in mind very much the words of the noble Lord, Lord Morton of Shuna.
To reply to the other point, husbands and wives are not responsible for each other's debts unless the law so provides, as Clause 16 does. I think that covers the point of my noble friend Lord Swinfen. To recap, this amendment provides in certain circumstances an indemnity for a person who has to pay the community charge on behalf of his or her partner by virtue of joint and several liability. It is a clarificatory amendment which I commend to your Lordships.
6.59 p.m.
On Question, Whether the said amendment (No. 60) shall be agreed to?
Their Lordships divided: Contents, 72; Not-Contents, 37.

DIVISION NO. 4

CONTENTS

Alexander of Tunis, E.

Ferrier, L.

Arran, E.

Fortescue, E.

Auckland, L.

Hanson, L.

Beaverbrook, L.

Havers, L.

Belhaven and Stenton, L.

Henley, L.

Beloff, L.

Hesketh, L.

Belstead, L.

Hives, L.

Bethell, L.

Home of the Hirsel, L.

Blatch, B.

Hooper, B.

Brabazon of Tara, L.

Hylton-Foster, B.

Brougham and Vaux, L.

Jenkin of Roding, L.

Broxbourne, L.

Kitchener, E.

Bruce-Gardyne, L.

Lindsey and Abingdon, E.

Caithness, E.

Long, V. [Teller.]

Cameron of Lochbroom, L.

Lucas of Chilworth, L.

Campbell of Alloway, L.

McAlpine of West Green, L.

Campbell of Croy, L.

Macleod of Borve, B.

Coleraine, L.

Mancroft, L.

Colwyn, L.

Marshall of Leeds, L.

Constantine of Stanmore, L.

Merrivale, L.

Cork and Orrery, E.

Mersey, V.

Cox, B.

Mottistone, L.

Craigavon, V.

Munster, E.

Craigmyle, L.

Murton of Lindisfarne, L.

Davidson, V. [Teller.]

Nelson, E.

Denham, L.

Orkney, E.

Dilhorne, V.

Pender, L.

Dundee, E.

Penrhyn, L.

Faithfull, B.

Redesdale, L.

1763

Renton, L.

Teynham, L.

Rochdale, V.

Thomas of Gwydir, L.

Skelmersdale, L.

Trafford, L.

Stevens of Ludgate, L.

Trefgarne, L.

Stockton, E.

Ullswater, V.

Strathclyde, L.

Vaux of Harrowden, L.

Teviot, L.

Wise, L.

NOT-CONTENTS

Addington, L.

McNair, L.

Airedale, L.

Morton of Shuna, L.

Bonham-Carter, L.

Nicol, B. [Teller.]

Carmichael of Kelvingrove, L.

Oram, L.

Cledwyn of Penrhos, L.

Pitt of Hampstead, L.

David, B.

Ponsonby of Shulbrede, L. [Teller.]

Dean of Beswick, L.

Donoughue, L.

Robson of Kiddington, B.

Dormand of Easington, L.

Ross of Newport, L.

Elwyn-Jones, L.

Seear, B.

Graham of Edmonton, L.

Stedman, B.

Grey, E.

Stewart of Fulham, L.

Harris of Greenwich, L.

Stoddart of Swindon, L.

Hatch of Lusby, L.

Strabolgi, L.

Irving of Dartford, L.

Tordoff, L.

Jay, L.

Turner of Camden, B.

Jeger, B.

Underhill, L.

Listowel, E.

Wallace of Coslany, L.

McIntosh of Haringey, L.

White, B.

Resolved in the affirmative, and amendment agreed to accordingly.
7.7 p.m.
[Amendment No. 61 not moved.]
Lord Hesketh: My Lords, may I suggest that this is a suitable moment for us to retire to dinner and return here at 8 o'clock? I beg to move that further consideration on Report he now adjourned.
Moved accordingly, and, on Question, Motion agreed to.

British Waterways Board (Rateable Values) (Scotland) Amendment Order 1988
The Earl of Dundee The Earl of Dundee rose to move, That the draft order laid before the House on 7th June be approved [28th Report from the Joint Committee].
The noble Earl said: My Lords, the need for these two brief amendment orders is a straightforward one. They are both technical amendments necessitated by a change in the base year for calculation of the retail prices index from January 1974 to January 1987. Such a change was not anticipated at the time the original orders were made. Therefore, they now require to be amended to take account of this change. Failure to do so would result in very sizeable and completely unwarranted increases in the rates bill of the two undertakings concerned.
As your Lordships will know, conventional valuation methods are not appropriate for certain undertakings such as the electricity supply industry, British Gas and British Telecom. These industries are valued according to formulae set out in orders made under Section 6 of the Local Government (Scotland) Act 1975. The lands and heritages of the statutory docks and of the British Waterways Board in Scotland also fall in this category; but the formulae applied in determining their rateable values differ in that they include an adjustment factor based on the retail prices index.
The change in the base year of the retail prices index to 1987 means that these formulae require to be amended to take account of this change; otherwise we would have the situation where the rates bill of the British Waterways Board in respect of its canals in Scotland would double through no fault of its own. The position of the statutory dock undertakings would be even worse with an average fourfold increase in rates. This is clearly unacceptable.
We have consulted widely on these amendment orders. The Convention of Scottish Local Authorities, the British Waterways Board, the British Ports Federation and statutory dock undertakings outside the federation have all agreed on the need for these amendments to the orders setting out the formulae in question. I commend these orders to your Lordships. I beg to move.
Moved, That the draft order laid before the House on 7th June be approved [28th Report from the Joint Committee.]—(The Earl of Dundee.)
Lord Carmichael of Kelvingrove: My Lords, I thank the Minister for the explanation that he has given of the orders, which will relieve the two bodies of the need to pay the additional moneys which they would have paid in rates if the adjustment in the method of calculation had not been necessary. I have not received representations from either of those bodies or from the business community. However, the Minister has said that there has been a great deal of correspondence and a number of meetings with the bodies.
It is worrying that, in a system long experienced in the practice and method of valuation, there should be what I agree is a minor hiccup. Perhaps I may ask the Minister what will happen if, when the poll tax legislation is introduced, alterations in non-domestic rates are required? Will we have a succession of orders such as this for all statutory undertakings? Will there be a way in which they can be brought into line more quickly? Perhaps the Minister, if he is not able to answer my questions tonight, will let me know in due course whether there will be any problems when poll tax evaluations are made and how comparability between the Scottish method of calculation and the new method which will be used in the UK for non-domestic property will be maintained.
The Earl of Dundee: My Lords, I am grateful to the noble Lord, Lord Carmichael, for his comments. I wish to reassure him that there is no connection between the orders that we are considering tonight and the community charge legislation. As regards the position of formula-valued subjects affected by the 1990 revaluation, a major review is now being undertaken both north and south of the Border of all the present formula-valuation orders in time for the 1990 revaluation. That review is being carried out by various working groups which include representatives of the undertakings affected, as well as of assessors of local authorities. Reports have been requested from the working groups by the end of this year, and we shall study them carefully before taking any decisions relevant to 1990 and beyond.
On Question, Motion agreed to.

Docks and Harbours (Rateable Values) (Scotland) Amendment Order 1988
7.13 p.m.
The Earl of Dundee: My Lords, I beg to move.
Moved, That the draft order laid before the House on 7th June be approved [28th Report from the Joint Committee.]—(The Earl of Dundee.)
On Question, Motion agreed to.
Viscount Long: My Lords, I beg to move that the House do now adjourn during pleasure until eight o'clock.
Moved accordingly, and, on Question, Motion agreed to.
[The sitting was suspended from 7.14 to 8 p.m.].

Local Government Finance Bill
Consideration of amendments on Report resumed.
Schedule 2 [Community charges: administration]:
Lord Hesketh Lord Hesketh moved Amendment No. 62:
Page 95, line 19, leave out ("including") and insert ("which may include").
The noble Lord said: My Lords, in moving Amendent No. 62 I shall speak also to Amendments Nos. 64, 65, 67, 68, 69, 81, 179, 180, 181 and 183. Noble Lords will note that I am not speaking to Amendments Nos. 195, 196, 197 and 199. That is because those amendments relate to Schedule 12, which deals with residual domestic rates, and the Goverment have announced this afternoon that they propose to delete Part IV of the Bill and the associated schedules. We have taken the view that the whole of England should move straight to the community charge in 1990. I hope that this news, which follows the debate at Committee stage when this course of action was pressed upon us, will commend itself and that noble Lords will be able to give it a welcome as a further government concession. The score should now be six.
Reverting to the more mundane matter of the amendments which remain in the group, these are drafting amendments which clarify the provisions relating to payments on account. Because liability to the community charge and non-domestic rates accrues on a daily basis, the actual amount for which a person is liable is not known until the end of the financial year. The Bill therefore allows for regulations to provide for payments on account based on estimates and for the estimates to be based on prescribed assumptions.
It is in the nature of a payment on account which is due before the end of the chargeable financial year that it must be based on an estimate, since as I have explained the actual amount owing cannot be known. The regulation-making power currently in the Bill is, however, drafted in discretionary terms leaving some room for doubt whether the regulations could require estimates in relation to payments on account and whether they could set out assumptions on which estimates must be based. This doubt became
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apparent to the department when beginning to prepare the regulations. As a result we have tabled these amendments, which also clarify what is meant by a payment on account. It seemed to us that the best course of action would be to amend the Bill to remove all doubt and ensure that regulations could he made with the effect that we have always intended. On that basis, I beg to move.
Lord Graham of Edmonton: My Lords, in the normal course of events I would not have risen to speak because, as the Minister has said, these amendments are of a technical nature. It is always a great puzzle to know how announcements such as the one made today about the abolition of residual rating will appear. As I understand it, there will be a need at a later point in the Report stage for amendments and we will wait until then to say what we have to say. However, the Minister has quite properly drawn our attention to amendments grouped with Amendment No. 195 which relate to Schedule 12 and which become unnecessary because the schedule is to be deleted.
Perhaps I may take the opportunity not of knocking the Government for six but expressing appreciation for their concessions or ameliorations—of which the noble Lord, Lord McIntosh of Haringey, kept a careful count yesterday—all of them welcome. I should like to say from these Benches how very grateful we are to the Minister and his colleagues. I am certain that however one chides the Minister for failing to listen—and at times we think we have a genuine criticism—in this instance I am certain that he and his colleagues have been impressed by the case that was put from all round the House, not least by the noble Lord, Lord Hayter, and the noble Baroness, Lady Faithful, who also spoke with force about the nexus of the residual rates.
There is no doubt, I believe, that the Minister will have been impressed among other factors by the horrendous situation that would have faced many council administrations in having to operate dual running with all the aggravations, frustrations and distresses that that would have caused. I should certainly like the Minister at this early stage to feel that he has satisfied me. I believe that he will recall that I spoke as president of the Association of London Authorities. I have not been in touch with the association, but I do not need to be in touch with it. I am absolutely certain that its members will pause in their continual dicing and battling with the Government in order to thank the Minister and his advisers for recognising the dilemma in which they would have found themselves.
That is a lot to say on something that is not even to be moved this evening. But the Minister has provided us with an opportunity of saying "thank you" at an early stage.
Baroness Stedman: My Lords, perhaps I may from this Bench also thank the Minister and echo what the noble Lord, Lord Graham, has said. We are extremely grateful for the announcement that was made earlier today. We appreciate it.
On Question, amendment agreed to.
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 63:
Page 95, line 23, at end insert ("Provided that any prescribed scheme shall not contain provision for a minimum payment in any one instalment which exceeds the amount equal to 3 per cent. of the current rate of basic income support payable under the Social Security Act 1986.").
The noble Lord said: My Lords, the purpose of the amendment is to provide that the prescribed scheme for the payment of the poll tax in instalments should not specify a minimum amount in excess of 3 per cent. of the current rate of basic income support.
When this matter was raised earlier the Minister who was responsible for dealing with it was the noble Lord, Lord Glenarthur. The House will recall that we are anxious to avoid authorities being unduly burdened by the effect of the Bill as it stands in respect of payments on instalment. This is not a matter over which we shall die in the ditch, but it is one which we are honour bound to raise again. I should be grateful for the Minister's observations. I beg to move.
Lord Hesketh: My Lords, this amendment differs very little from one which was tabled and discussed at an earlier stage. As my noble friend Lord Glenarthur said then and as the noble Lord, Lord Graham, has pointed out, we do not believe this amendment to be necessary. Charging authorities will be entitled to make whatever agreement on payments that they see fit; and they will of course be much better placed than central government to decide what the best arrangements are in each case. They will have complete discretion to accept payments of whatever size they wish—even payments of less than a pound a week if they wish.
We do not intend to set up a prescribed scheme for 10 instalments, subject to a limit on the minimum size of a payment which an authority would be obliged to accept—for instance, £5. The reason for the limit is that we do not want to oblige authorities to collect very small sums unless they choose to do so.
It seems to me that what we are proposing is eminently sensible. Authorities will be able to accept very small payments, but they will not be obliged to do so. This amendment would simply remove local discretion in the matter, and is unacceptable for that reason. I have no hesitation, therefore, in urging your Lordships to oppose the amendment, if it should be pressed.
Lord Graham of Edmonton: My Lords, I would love to think that the Minister really means it when he says that he wants to leave discretion to local authorities in this matter but not in so many others. As I said at Committee stage, we are deeply concerned at the burden that will fall on many people who, by virtue of the change in the allowance regime and of a great many other factors, will have to budget very carefully. The Minister is right in saying that we are laying down a sum which small instalments shall not exceed. However, we are not in the mood to press this amendment at this stage.
We believe that there will not be a riot, there will not be a strike, but thousands of people will simply have to hunch their shoulders and cope with the
1768
burden as best they can. In getting on with it as best they can they will make do. There will not be a great deal of distress, but life will be just a little more difficult for people at the lower end of the income scale and in poorer circumstances than they might otherwise be. I am not in the mood to press the matter. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Hesketh Lord Hesketh moved Amendments Nos. 64 and 65:
Page 95, line 24, leave out ("payments on account may") and insert ("in prescribed circumstances payments on account must").
Page 95, line 26, leave out ("may") and insert ("must").
On Question, amendments agreed to.
Lord Hesketh Lord Hesketh moved Amendment No. 66:
Page 96, line 9, leave out ("within a prescribed period beginning with") and insert ("on the day after the end of a prescribed period which begins with the day or').
The noble Lord said: My Lords, in moving this amendment I should like also to speak to Amendment No. 182. Again, I am not speaking to Amendment No. 198, which refers to residual domestic rates. These amendments bring the drafting of the Bill into line with what the policy has always been and the current provisions for rates. The amendments ensure that if an instalment of the community charge or rates is unpaid, there is a period of grace after the due date. If at the end of that period the instalment has still not been paid, the whole of that year's bill will become due. I beg to move.
Lord Graham of Edmonton: My Lords, I apologise but I did not hear the noble Lord's last sentence, which seemed to me to be significant. May I ask him to repeat his last words?
Lord Hesketh: My Lords, the last sentence is: But if at the end of that period the instalment has still not been paid, the whole of that year's bill will become due.
Lord Graham of Edmonton: That, my Lords, is what I thought the Minister said. It seems to me to be rather punitive. I can understand the nexus of an agreement, the basis of which is a commitment to pay a due sum in an agreed form, which is by instalments, and certainly those instalments need to be paid. But can the Minister tell us what are the procedures for pleading the case of someone who finds himself in real difficulty?
Lord Hesketh: My Lords, the policy has always been that the full amount should be payable following a prescribed period, which gives an individual a period of grace in which to pay his bill. He has that period of grace but following it he is then in the position of having to pay the full amount.
Lord Graham of Edmonton: My Lords, with the leave of the House, perhaps I may say that the situation does not sound any better. In rates offices (which will be charge offices) there will be people who will be well known. It is not an uncommon practice for people to delay paying bills, including gas bills and so on, until they get a final demand. Can the

1769
Minister tell us what will be the procedure if a person who fails to meet his instalments is asked to pay the totality of the amount due? What will happen to him if he cannot pay? I presume that the Minister will say that this is a matter for the county court and a question of due process of law.
Not for a moment would I wish to defend someone who tries to evade his obligations to pay. I am trying to obtain from the noble Lord some concession that there will be either an appeal procedure or a process of amelioration or renegotiation. I am talking about what I call little people and little sums of money. The Minister knows very well that there are big people with big sums of money who, if they are not able to get away with murder, at least seem to be able to make satisfactory arrangements of some kind. At the end of the day those who are required to pay money should in fact pay it. But can the Minister tell us whether he has in mind some means of encouraging them to pay, even if it consists, in modern jargon, of rescheduling the debt?
Lord Hesketh: My Lords, I must make absolutely clear that there are three distinct stages to go through. Obviously an individual first receives a bill, following which he will receive a statutory reminder. Then a minimum period of at least 14 days will elapse before he receives the full bill. During all that time he has the opportunity to go and discuss the matter with his local authority if he feels aggrieved.
Lord Graham of Edmonton: My Lords, let me say at once that I am not trying to put a case that the Government are either uncaring or unbusinesslike in their procedures. What the Minister said as regards time is not unreasonable. However, I believe that there will he many more people who will be obliged to meet a charge, and a number of them may hitherto have left such matters to their mams or dads. They will now have to make payments and there will be a lot of people who will have to become used to dealing with the council in these matters.
The noble Lord has indicated to me that the Government feel that the arrangements are reasonable and satisfactory. I do not believe they are, but I do not intend to press the matter. I shall leave it alone.
On Question, amendment agreed to.
Lord Hesketh Lord Hesketh moved Amendments Nos. 67 to 69:
Page 96, line 51, leave Out ("including") and insert ("which may include").
Page 97, line 4, leave out ("payments on account may") and insert ("in prescribed circumstances payments on account must").
Page 97, line 6, leave out ("may") and insert ("must").
On Question, amendments agreed to.
8.15 p.m.
The Earl of Caithness The Earl of Caithness moved Amendment No. 70:
Page 98, line 50, at end insert—
("(3A) The regulations may include provision allowing or requiring a registration officer for a charging authority to revoke a designation of an individual as a responsible individual.").
The noble Earl said: My Lords, in moving this amendment I should like also to speak to
1770
Amendments Nos. 82, 83, 84, 119, 120, 123, 124, 127, 242 and 243. That may seem a formidable group of amendments. However, as I hope I shall be able to satisfy the House, their purpose is straightforward and they merely clarify the way in which the appeal system has always been envisaged as working.
In taking your Lordships through the amendments, I shall deal with them in what I hope is a logical sequence in order to make them more comprehensible. I shall start with Amendment No. 124. This amendment provides for the CCRO (community charge registration officer) to carry out the function of designating a person as a certification officer in respect of an educational establishment—that is, the person responsible for certifying that a person is a student for the purposes of the community charge. It has always been our intention that the community charge registration officer should carry out this function and it seems sensible to make this clear on the face of the Bill rather than leaving it to be prescribed in regulations.
Amendment No. 127 provides that where the community charge registration officer has designated a person as a certification officer and the designation is no longer appropriate—for instance, because another person in the establishment has undertaken to perform this function—the community charge registration officer may revoke the designation. Amendment No. 70 similarly provides that the community charge registration officer may revoke a designation as a responsible individual (that is, the person responsible for providing information to the community charge registration officer about adult members of' the household) where this designation is no longer appropriate. Amendments Nos. 119 and 120 provide where a community charge registration officer has not revoked a designation as a certification officer or responsible individual, the person concerned may appeal to the valuation and community charge tribunal.
Amendment No. 242 provides that where, on appeal, a tribunal orders that a designation as a certification officer should be revoked, the community charge registration officer shall revoke it. Paragraph 10(1)(b) of Schedule 14 already provides for a tribunal to order revocation of a designation as a responsible individual. Amendment No. 243 is a drafting amendment which puts the duties under paragraph 14(2) in the same order as the list of qualifying circumstances in paragraph 14(1).
We now come to the new clause to be inserted after Clause 23—that is, Amendment No. 123. As the Bill is currently drafted, anyone who was aggrieved by a decision of the registration officer or charging authority on any of the matters listed in Clause 23 would take his case direct to a valuation and community charge tribunal. This could result in an unnecessary burden on the tribunals because there will be many cases where the community charge registration officer or charging authority has got it wrong—for instance, if someone has moved out of the area since he or she completed the canvass form. In these circumstances it is only sensible to give the community charge registration officer an opportunity to put matters right without going through the full panoply of an appeal to the tribunal.
Amendment No. 123 therefore provides that a person may not take an appeal to a tribunal unless he or she has first made representations to the community charge registration officer or charging authority (depending on who issued the decision being appealed against). This will leave the tribunals to determine genuine disputes and should result in a speedier resolution of genuine appeals. In order to protect the appellant, however, the amendment provides that if the community charge registration officer or charging authority has not responded to the representations within two months, the person concerned may take his or her appeal to the tribunal.
The remaining amendments deal with penalties. Amendments 82 and 83 enable the charging authority, or community charge registration officer, to quash a penalty which they have imposed. Thus if a person who has received notice of the imposition of a penalty makes representations under the provisions of the new clause which I have just outlined, the charging authority or community charge registration officer—if satisfied that the person had a reasonable excuse—may quash the penalty.
Amendment No. 84 deals with the situation in which a person makes representations against the imposition of a penalty, but pays it nonetheless. This amendment enables regulations made under Schedule 3 to provide that in such circumstances the amount of the penalty may be repaid, or allowance made by deduction against a sum due in respect of a community charge. I beg to move.
On Question, amendment agreed to.
Lord Hesketh Lord Hesketh moved Amendment No. 71:
Page 99, line 25, after ("time") insert ("on or").
The noble Lord said: My Lords, this is a drafting amendment. I beg to move.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 72:
Page 100, line 23, at end insert—
("13A.—(1) Regulations under this Schedule may include provision that no duty of confidentiality shall prevent the Secretary of State from disclosing relevant information to a registration officer for a charging authority.
(2) Information is relevant information if—

(a) it was obtained by the Secretary of State in exercising his functions under the Social Security Act 1986,

(b) the Secretary of State believes it would be useful to the registration officer in exercising his functions under this Part, and

(c) it falls within a prescribed description.").

The noble Earl said: My Lords, this is a new amendment, which I beg to move. This amendment will enable the Secretary of State to make regulations to allow the Secretary of State for Social Services, in the person of his local office officials, to disclose certain limited information to registration officers. The Government's intention to introduce this provision was announced by my honourable friend the Minister for Local Government during the earlier proceedings on this Bill in another place. The information will be restricted to the names and addresses only of those people in receipt of income
1772
support who have not applied for a community charge rebate.
In the months preceding the introduction of the community charge, and thereafter, when a person applies for income support at a DHSS local office, he or she will be invited to apply for a community charge rebate. If the person completes an application form, this will be forwarded to the appropriate local authority's rebate section. People who are entitled to income support will be automatically entitled to the maximum rebate. The effect of this procedure will be that the person will receive a community charge bill, reduced, of course, by the amount of rebate. People in receipt of income support will also receive additional help, through the income support system, to pay their 20 per cent. minimum contribution.
However, if a person is awarded income support but does not apply for a rebate, there would be no means by which a registration officer could crosscheck whether that person was registered as liable to pay the charge, even though the person would be receiving the additional amount of benefit with which to pay. Our intention, therefore, is that the names and addresses only of people in receipt of income support who do not claim a rebate should be passed direct to the registration officer. Anyone whose name and address is disclosed to the registration officer will be informed, and the information disclosed will be used only for the purpose of cross-checking the register. This is a sensible additional source of information for the registration officer in ensuring that the register is complete. I beg to move.
Lord Jay: My Lords, I should like to ask the Minister one question. The amendment says,
"that no duty of confidentiality shall prevent the Secretary of State from disclosing relevant information to a registration officer".
I presume that it does not enable any other official of any government department other than the Department of the Environment to disclose such information?
In particular can the noble Earl assure us that this would not override the obligation of an official of the Inland Revenue not to disclose information about anybody's income to anyone else, even in the government service? That has always been the law, and I presume it remains so. However, it is rather odd to find a new legislative provision which relieves people from their duty of confidentiality. Perhaps the Minister can reassure us that in no way would this enable information to be obtained from the Inland Revenue?
One of the oddities of this Bill is that it assumes throughout that the local authorities know what people's incomes are, but of course they do not and if they cannot get it from the Inland Revenue—which I hope they cannot—it remains a mystery how they would obtain it. Perhaps we may have that assurance.
Lord McIntosh of Haringey: My Lords, I have worries in addition to those expressed by my noble friend Lord Jay. In the first part of his speech the Minister was entirely plausible in giving reasons why the Secretary of State for Social Services should be able to pass on information when an applicant for income support is also making an application for a

1773
rebate from the community charge. If the amendment were limited to that, I suspect that we should have no difficulty with it. But that is not what the amendment says.
The amendment says that the duty of confidentiality is released from the Secretary of State—presumably for health and social services, because he is the one who exercises his functions under the Social Security Act 1986—the only restriction being that the,
"Secretary of State believes it would be useful to the registration officer in exercising his functions under this Part, and
(c) it falls within a prescribed description."
Of course "prescribed description" leaves it to the Secretary of State—presumably in this case the Secretary of State for the Environment—to prescribe what information may be transferred.
We have had an indication that this is only going to be the name and address—and we would certainly want to have the firm assurance that that is what is Meant by "a prescribed description"—but it was not quite spelt out in that way and I am still unhappy about this amendment. I am still unhappy about the idea that when somebody applies for income support and does not want to apply for the community charge rebate, his name and address will still be passed to the registration officer.
We already have a serious problem of underclaiming of social security benefits, and in particular underclaiming of income support. Anything that encourages or allows any potential claimant to think that by simply going into the benefit office and claiming income support, whether or not he wants to claim the social security rebate, he is going to find his name and address passed on to the registration officer, placed on a register, made available not for sale but for inspection by members of the public, is bound to act as a deterrent to those people who are on the margin in deciding whether they are going to claim income support or not.
If the admirable reasons that the Minister gave for this amendment were reflected in the amendment, we should have no difficulty with it, but, as drafted, it seems to be far too wide. I should like to see much firmer assurances than the Minister has given that it will be used only in the case of those people who are being helped to apply for the rebate of 80 per cent. of the community charge. If that were the case, we should be happy. If it is anything more than that, we are certainly not happy, and we may have to consider whether to put down further amendments to this at Third Reading.
Lord Ross of Newport: My Lords, perhaps I may speak briefly in support of the noble Lords, Lord Jay and Lord McIntosh. The wording of this amendment, which comes in very late in the passage of this Bill, ought to be looked at carefully. The Secretary of State has only to believe that the information would be "useful" to pass on the information and the only limitation will be what he himself will prescribe.
I also agree with the noble Lord, Lord McIntosh, that it may well have a deterrent effect on people when claiming benefits. We know that the take-up of many benefits is extremely low. I have qualms about
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this amendment. It sounded all right as it was put forward by the Minister, but I think we should look at it more closely before we pass it on the nod in this House.
The Earl of Caithness: My Lords, may I first deal with the point raised by the noble Lord, Lord Jay? I can say to him that nothing in the amendment relates to the Inland Revenue. It was only of the DHSS that I was speaking, so his concerns are abated. To the noble Lords, Lord McIntosh and Lord Ross of Newport, let me just repeat this undertaking: it will only—I stress only—be names and addresses and not sensitive information that are passed on. We are not trying to discourage people from claiming benefit, but we must try to ensure that people whose income support will include an amount in respect of the community charge are already registered for that purpose. Indeed, it is beholden on people to register for the community charge. It is only right if such a person is claiming income support that the power in the amendment to do this cross-section on names and addresses only is available.
Lord Jay: My Lords, the amendment refers to the Secretary of State. I presume that this means the Secretary of State who has responsibility for the DHSS. Is it quite clear from the Bill that that is so? Is it certain that we are not giving this power to almost any Secretary of State? The Bill should obviously be clear on this.
The Earl of Caithness: My Lords, from my understanding of the Bill, it is clear. However, I should like to look into the point and advise the noble Lord.
Lord Dormand of Easington: My Lords, as I understood the Minister, this is information on names and addresses only. If that is so, it is very different from saying, as the amendment does, that the information,
"would be useful to the registration officer in exercising his functions".
In that case, a number of matters would be applicable rather than names and addresses only. If that is what the Government mean, why does the amendment not say so?
The Earl of Caithness: My Lords, the noble Lord has the assurance that I gave and repeat: it is names and addresses only that the registration officer needs to complete his functions as set out in the Bill.
On Question, amendment agreed to.
[Amendments Nos. 73 and 74 not moved.]
8.30 p.m.
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 75:
Page 101, line 7, leave out ("may") and insert ("shall").
The noble Lord said: My Lords, the Minister will recall that Amendment No. 75 was touched on yesterday in discussion on commercial availability of the registers. My noble friend Lord McIntosh of Haringey asked whether the Minister and his advisers would consider this amendment helpful in

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connection with the amendments spoken to by the noble Lord, Lord Meston, and to be moved in due time. I should be most grateful for the Minister's guidance. I beg to move.
The Earl of Caithness: My Lords, I understand the noble Lord to have moved the amendment for discussion as it was raised last night by the noble Lords, Lord McIntosh of Haringey and Lord Meston. I can confirm that I have considered it between then and lunchtime today. My mind has been concentrated on other things since then, but due consideration has been given to it.
As the noble Lord knows, the Government have said that they will accept Amendments Nos. 76, 77 and 80, which will empower the Secretary of State to prohibit the sale of the register. I therefore give the unequivocal assurance that my right honourable friend will use the power to do just that, to prevent copies of the extracts being made available to any individual.
Lord McIntosh of Haringey: My Lords, I am grateful to the Minister for what he has said. With the leave of the House, perhaps I may put it to him again in the light of his assurances that there can be no conceivable objection to his agreeing to the amendment which completes the statement that he has just made. The effect will be to say "shall" not be sold rather than "may" not be sold. I fear that I have not done a concordance of the documents before me, but the Minister is well aware of the point. Would it not be stronger and more effective to agree Amendment No. 75 as well?
The Earl of Caithness: My Lords, with the leave of the House, the noble Lord now takes me into a very technical area of the Bill where I have asked for legal advice. To substitute "shall" for "may" in paragraph 16(3) would cast doubt on the use of the word "may" throughout Schedule 2. The result would be a potentially damaging lack of clarity. I must therefore bow to my legal advice on this point. The noble Lord has my earlier assurance.
Lord Graham of Edmonton: My Lords, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Newport Lord Ross of Newport moved Amendment No. 76:
Page 101, line 7, leave out ("shall (on request)") and insert "may not").
On Question, amendment agreed to.
Lord Ross of Newport Lord Ross of Newport moved Amendment No. 77:
Page 101, line 9, leave out sub-paragraphs (4) and (5).
On Question, amendment agreed to.
[Amendments Nos. 78 and 79 not moved.]
Lord Ross of Newport Lord Ross of Newport moved Amendment No. 80:
Page 101, line 15, leave out ("sub-paragraphs (2) to (5)") and insert ("sub-paragraph (2)").
On Question, amendment agreed to.
Lord Hesketh Lord Hesketh moved Amendment No. 81:
Page 101, line 27, at end inset—
("19. Any reference in this Schedule to a payment on account of an amount is to any payment (whether interim. final or sole) in respect of the amount.").
On Question, amendment agreed to.
Schedule 3 [Community charges: penalties]:
The Earl of Caithness The Earl of Caithness moved Amendments Nos. 82 to 84:
Page 102, line 18, at end insert—
("(8) An authority may quash a penalty imposed by it.").
Page 103, line 35, at end insert—
("(12) An officer may quash a penalty imposed by him.").
Page 104, line 15, at end insert—
("(4A) The regulations may include provision dealing with any case where a penalty is quashed, and may in particular provide for the repayment of an amount or the allowance of an amount by way of deduction against a sum due.").
On Question, amendments agreed to.
Schedule 4 [Community charges: enforcement]:
[Amendments Nos. 85 and 86 not moved.]
Lord Hesketh Lord Hesketh moved Amendment No. 87:
Page 105, line 17, at end insert—
("(aa) provision prescribing steps to be taken before an application may be made;").
The noble Lord said: My Lords, this is a technical amendment designed to clarify the procedures for the initiation of enforcement action in cases of failure to pay the community charges. We discussed it earlier with Amendment No. 66. I beg to move.
On Question, amendment agreed to.
Lord Hesketh Lord Hesketh moved Amendment No. 88:
Page 105, line 21, leave out ("as to notices and").
On Question, amendment agreed to.
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 89:
Page 105, line 24, at end insert—
("(4) The regulations shall include provision that on an application to a Magistrates court for a liability order any payment or part payment due to an authority may be remitted by the court on the grounds of poverty.").
The noble Lord said: My Lords, with this amendment, I wish to speak also to Amendments Nos. 112 and 117. It deals with people seen under the criteria of the court to be so poverty stricken that they need special treatment. In his notes the Minister will see that when we brought this matter before the Committee on a previous occasion his ministerial colleague, the noble Lord, Lord Glenarthur, pointed out that the fears I had were dealt with in another part of the Bill. He said that in paragraph 7(3)(c) of Schedule 4 there is already a provision for magistrates,
"to remit payment in certain circumstances. I hope that in the light of this the noble Lord will take it as confirmation from me that the commitment which was given in another place has been carried out in that sub-paragraph".—[Official Report, 7/6/88; col. 1293.]
When I asked for action on the grounds of poverty, the Minister's colleague said that the power is already there because in certain circumstances remission can be given. I want the Minister to tell me that one of

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those circumstances is poverty. We do not want to find that this phrase, which is a catch-all phrase, "certain circumstances", excludes specifically being able to remit on the grounds of poverty.
I repeat that I am very conscious of the fact that there are not masses of people, but a considerable number, who, when they are faced with paying the sums of money that even Members of the House may not find easy to pay, may have to stand up in a court and say "I do not have a penny in the world", "I cannot meet the £10" or whatever it is. There are people like that. I sometimes go to the courts from time to time to watch the proceedings. It is a miserable situation to see the lot of some people. I hope that the Minister can tell us that when his colleague drew my attention to sub-paragraph 7(3)(c), that included remission on the grounds of a court finding that the person was literally unable to pay and was poverty stricken. I beg to move.
Lord Seebohm: My Lords, I should like to support this amendment for a reason that has not been given by the noble Lord, Lord Graham. He usually turns over every stone, but I believe he has missed one. The importance of this amendment is that those who pay only 20 per cent. will be recompensed not from the local authority but from the social security system based on 20 per cent. of the national average. That means that in our old friend Camden the poor people will be £100 short, which they cannot pay. In the deprived areas where the needs are greatest and there are large numbers of poor, they will be severely taxed, whereas in the more prosperous areas they will make a profit. That seems to me to be not only unfair but absolute nonsense.
The amendment of the noble Lord, Lord Graham, does not deal with this matter, but it would help a great deal and therefore I hope that it will be received.
Lord Dean of Beswick: My Lords, I listened earlier today to the debates on some of the amendments that related to this problem. One of the faults in the Bill is that it is so all-embracing. It does not have detailed regard for areas of special need. There are areas in London and most of our major cities, certainly in my home town of Manchester, where a substantial number of people in the city centre have to receive maximum financial support from public funding. There is very little possibility in the foreseeable future for any change in the financial situation for that group of families.
It is a well known fact that in some areas of inner cities, even before the situation deteriorated to its present low level, the percentage of' people on substantial financial support from public funds was as high as 50 per cent. That occurred in areas such as Moss Side and Hulme in Manchester and quite a substantial area in the central boroughs in inner London. The noble Lord, Lord Seebohm, made a very clear point when he asked whether there could be any higher poverty than that, when families, including the men, their wives and their children, have to exist and will do so into the far foreseeable future on a very high level of public funding.
I hope that the Minister will consider what my noble friend Lord Graham said and what the noble
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Lord, Lord Seebohm, and I have repeated, and will look at this amendment and include it with the sympathy that I believe it deserves.
8.45 p.m.
The Earl of Caithness: My Lords, the first two of these amendments would empower the magistrates' court to remit payment of the community charge on grounds of poverty in cases where a charging authority applies for a liability order either against a person who has failed to pay the charge or against a person whose spouse has failed to pay the charge.
A similar amendment was discussed at an earlier stage, and the noble Lord, Lord Graham of Edmonton, has repeated many of the arguments that were put forward then. In turn, I am afraid that I shall repeat the Government's arguments in much the same terms as then used by my noble friend Lord Glenarthur. This is an important issue and not one on which the Government's position has changed, because we believe that the provisions we have made in Schedule 4 are satisfactory on this point and should not be amended.
I should like to begin by making a number of general comments. First, we expect the vast majority of people to pay their community charge on time, just as they do with rates. Secondly, I must resist the notion that a large number of community charge debts should simply be written off. Every £1 of community charge that is not paid by one person will have to be paid by others. We all know that many people who are not wealthy—elderly people, for example, on fixed incomes—take great pride in paying their bills. It would be entirely unreasonable to put a larger burden on them by making it easier for others not to pay their bills. Thirdly, I must remind your Lordships that the poorest people—those reliant on social security benefits—will be receiving an extra amount within their income support towards the community charge.
Having made these general comments, I should like to remind your Lordships of the procedures that will be followed when a community charge bill is not paid.
The first step is that the charging authority will be required to send a reminder to the individual. I would expect that the charging authority will also invite the individual to say whether he is suffering financial difficulties, and will want to discuss with him ways of paying off the amount without going to court, if that is possible. That is what happens with rates; and it is what will happen with the community charge.
If, despite those attempts by the authority, the bill is still not paid and no satisfactory agreement is reached to pay off the debt, the charging authority will be able to ask the magistrates' court for a liability order against that person. Before issuing it, the magistrates will have to be satisfied that there is a sum payable, that it is payable by the individual named and that the various steps, such as the sending of a reminder, have been complied with.
If it is satisfied on those points, the court will issue the liability order. It will not at that stage conduct an inquiry into the individual's means. The liability order allows the charging authority to take

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enforcement action against the individual. But of course it will also be happy to discuss with the person concerned how the debt can be paid off.
In the course of enforcement the local authority may find that the individual simply cannot be expected to pay the debt. I expect that to happen very infrequently, but where it does local authorities will be able to write off the debt. This is again exactly what happens with rates. The circumstances in which debts can be written off are agreed between local authorities and their auditors.
If the methods of enforcement at the authority's disposal are not sufficient to ensure that the debt is paid and the authority does not think that it would be appropriate to write it off, it will be able to return to the magistrates' court for a warrant authorising commitment of the person to prison. Obviously this is a very serious matter indeed and, again just as with rates, before issuing such a warrant the magistrates will be required to hold a means inquiry—a hearing into the individual's financial circumstances. Paragraph 7(1)(c) of Schedule 4 makes clear that only where the court is satisfied that there was "wilful refusal or culpable neglect" (that is, that the person could have paid had he wanted to) will it be able to order commitment to prison. If the magistrates are not satisfied on this point, they will refuse the warrant. They may, if they choose, also decide to remit the debt entirely. Again that power is set out in Schedule 4—and this is the important point for the noble Lord, Lord Graham of Edmonton—in paragraph 7(3)(c).
I have felt it right to deal at some length with the arrangements we propose, as my noble friend Lord Glenarthur did at an earlier stage, because I want to emphasise that magistrates, and indeed local authorities, will and should have the ability to remit payment in the rare cases of genuine hardship. Where I must part company with the noble Lord is over whether magistrates should have that power at the liability order stage. I do not think it would be appropriate to provide such a power. To do so would risk encouraging many more people not to pay their bills in the hope that magistrates might refuse local authorities the right to recover the amounts. Were such cases to occur the costs would have to be borne by other people who do pay their bills; and there would also be a substantial administrative burden for magistrates in inquiring into the means of all those against whom liability orders were sought.
Finally, I turn to Amendment No. 117, which introduces a new proposal—that where a collective charge landlord takes a tenant to court to recover a collective charge contribution which the tenant has failed to pay, the court should have the power to remit payment on grounds of poverty. This is not a proposal which the Government can accept. If a tenant fails to pay rent, there is no question of the court remitting payment when the landlord tries to recover the unpaid amount. For the same reason there can be no question of remitting an unpaid collective charge contribution. It would be totally unfair to landlords, because it would leave them out of pocket with a liability to make a payment to the
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charging authority but no means of recovering the money.
I believe that Schedule 4 as it is currently drafted strikes the right balance as far as remission on grounds of poverty is concerned. I do not believe these amendments would represent any improvement. Indeed, I believe they would have serious adverse consequences.
Before I sit down I believe that it is only right to reply to the noble Lord, Lord Seebohm, because I disagree with his contention that uprating the income support by 20 per cent. of the average community charge is nonsense. It certainly is not. It means that if an authority spends more than the average, a maximum rebate recipient must find a very small part of the overspend from his own pocket; perhaps a few pence a week. That means that he will retain an incentive, however small, to consider the costs as well as the benefits to local services. That is what we mean by local accountability, about which we have talked so much in this Bill.
Lord Seebohm: My Lords, before the noble Earl sits down I should like to ask him whether he realises what the situation will be in Camden. Approximately 90 per cent. of those people in receipt of social benefit will have to pay £100 more than if it were based on the local charge. They are not paying the local charge but a charge which is connected with an average across the nation and over which they have no say at all.
The Earl of Caithness: My Lords, we have considered the situation of those people in local authorities where the spending is highest. We took that very much into account when considering the 80 per cent. rebate and the 20 per cent. of the average community charge.
Lord Dean of Beswick: My Lords, before the Minister sits down, I should like to say that magistrates are not necessarily rubber stamps for any government, irrespective of their political colour. Are we not in a situation where some magistrates' benches could have more enlightened views than those in other areas? Are we also not in a situation where the Act could be enforced but, if it is not obligatory, the magistrates could refuse to do what the Government want if they take that view and if there are any options left open? That situation happens now and it happened in the past in respect of the seizure of property under the old tenancies Act. That Act was scrapped because the magistrates had the right only to issue an eviction order and therefore dispossessions and so forth had to be processed through the county courts which took a longer time. The Minister may believe that this will be carried out in an even pattern. I believe that unless this is provided for in tramlines the situation could be very pepper-potted.
Lord Graham of Edmonton: My Lords, I wish that the noble Lord, Lord Glenarthur, had taken as much trouble in his reply in a previous debate as the Minister now. The content of his reply covered two column inches of Hansard and I venture to suggest that the Minister's reply will cover 22 or 24 column

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inches. He went into the detailed reasoning and interlocking way in which the situation would finally come before the courts. I found his explanation to be much more satisfactory.
I take the point that people may believe that there is a loophole and that they may plead poverty. The magistrates or the judges are reasonable people who know the circumstances, and they will not be seen to be an easy catch. They will be sensible.
I was distressed to hear the noble Lord, Lord Seebohm, quite properly draw to our attention the agony in which many people will find themselves. In places such as Camden, where the rates are very high, the circumstances I outlined could lead to people having to plead poverty.
I am satisfied with what the Minister said. I am grateful to him for taking all the time that he has. I believe that those outside the House will receive some assurance from what he said. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 90 and 91 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 92:
Page 105, line 43, after ("debtor)") insert ("and the debtor is an individual").
The noble Earl said: My Lords, at the same time I shall speak to Amendment No. 116. These are technical amendments. I beg to move.
On Question, amendment agreed to.
The Deputy Speaker (Lord Murton of Lindisfarne): My Lords, Amendments Nos. 93 and 94 are identical. If the noble Lord, Lord McIntosh of Haringey, moves his amendment, perhaps the noble Lord, Lord Ross, will abide by whatever decision is taken.
9 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 93:
Page 106, line 8, at end insert—
("(1A) No attachment of earnings order shall relate to any income from social security entitlement.").
The noble Lord said: My Lords, as the Deputy Speaker correctly points out, for some reason probably related to the time of tabling them, Amendments Nos. 93 and 94 are identical. I should like to speak also to Amendments Nos. 96, 104 to 106, 108, 110, 111, 113 to 115 and 118. I suggest that it may help the business of the House if the Minister could immediately introduce his substantive Amendment No. 96 and we could then debate all the amendments together as we did on an occasion yesterday. I hope that that will meet with the approval of the noble Earl and the House.
I should like to raise a query in connection with Amendment No. 110 standing in the name of the noble Lord, Lord Meston. I am surprised that it is included in the group because it deals with the different issue of ex-spouses. It may prove necessary to debate that issue separately.
We return in different terms to the question of the attachment of social security entitlements under the heading of the attachment of earnings. When we put forward a similar amendment in Committee the
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noble Lord, Lord Glenarthur, said, in effect, that it was wrong to treat social security benefits differently from earnings and therefore to treat people in employment differently from those in receipt of benefit. I thought about the argument, which appeared to be plausible at the time. However, it really does not hold water. After all, average earnings are something like £213 a week, and even minimum earnings for full-time work are very substantially above the income support level which is designed only to provide a minimum subsistence income. A single parent on income support receives £43·40 a week compared with the average earnings of £213.
The cases are clearly not equal in themselves. Therefore, equality of treatment is not an appropriate way to look at the issue. As another example, the income support level of a young person under 25 who has been in care and has come out of care and has received a social fund loan to help him or her set up home will be £26·05 a week. Under this year's system, the social fund repayments, which are limited to 10 per cent. of income support levels, will be £2·60, and the direct deductions for the social fund will be in the order of £7·75. If one takes the average poll tax figure for inner London, which is where many people in that situation reside, that would mean a poll tax contribution of £1·95. That leaves that young person with a net income after deductions of £13·75 a week.
It cannot be said that we are treating somebody under those conditions equally with somebody who is earning. It cannot be said to be right to treat somebody in those conditions in the same way as somebody who is earning. I cannot imagine how anybody could argue that £13·75 or any figure like that comes anywhere close even to minimum subsistence levels. It means that these people (who through no fault of their own have come into the adult community with very grave disadvantages) will be forced back on to dependency.
I thought that the Government were arguing against the dependency culture and trying to set people on their own feet. The Bill as drafted encourages dependency and does not help any of the Government's other stated objectives. The difficulty also arises because of the fact that the 20 per cent. poll tax payments which are to be made are to be based on the average throughout the country. That has been referred to on many occasions because it seems to us that it stretches the concept of accountability beyond what is reasonable to accept.
Let us look at the way that that argument works. Perhaps we may look at the figures issued last week by the Secretary of State on the average poll tax spending which would be at the level of the Government's needs assessment. The figure we are told now—and the noble Earl was kind enough to send me a copy of the figures—would be £202 for 1988–89. The figure for 1987–88 would have been £178; that is an increase of 13½ per cent. However, the increase in the income support to cover the 20 per cent. which these people will have to pay will have been determined once and for all in April 1989. Thereafter, it will only be increased in line with inflation. Even under this Government, where inflation is increasing, inflation will not be at the level of 13½ per cent. That means that in subsequent years

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those on income support will become progressively worse off if the calculations of average poll tax levels continue to increase in the same way and if inflation continues to increase at a lower level. This is encouraging dependency rather than seeking to help people to escape from it.
I do not believe that these amendments in any way conflict with the spirit which the Government claim in their approach to the social security system. I hope that the Government will accept that there is a sufficient point here for the amendment to be at least taken away and looked at because it seems that the Bill as drafted runs a grave risk of penalising a significant proportion of people who are already suffering very badly and living on a very minimum subsistence level. I beg to move.
Baroness Blatch: My Lords, before the noble Lord sits down, if the noble Lord is to use specific figures for the purposes of his argument, I understand that the inner London boroughs' average would be from about £550 to £560. The Government's notional average to offset the 20 per cent. would be about £45. Therefore, the amount required to be paid would be about £130 and not £195. If one is to use specific figures then I believe that it is important that they should be right.
Lord McIntosh of Haringey: My Lords, I did not say £195. I said £1·95 a week.
Baroness Blatch: My Lords, I am talking about £1·30.
Lord Renton: My Lords, I do not claim to have mastered the technicalities of this matter to the extent to which the noble Lord, Lord McIntosh, appears to have done. However, I should be grateful if my noble friend Lord Caithness, when replying, could explain this. Undoubtedly, originally the attachment of earnings orders under the 1958 Act—which I remember so well in another place because I helped to pilot that through Standing Committee and Report stage—referred only to earnings. I wonder whether there is any precedent for enabling the attachment of earnings order so-called, or an order analogous to it, to be applied to any kind of income or income support which are not earnings.
I believe that the crux of the matter is whether the scheme put forward by my noble friend in his Amendment No. 96 purports to be done under the attachment of earnings legislation or whether he is now putting forward a scheme not governed by that legislation but analagous to it. Of course, if he is doing something afresh to meet the circumstances of the case there might be greater justification for it, but I think that we are entitled to know what is the legislative status of my noble friend's scheme.
The Earl of Caithness: My Lords, perhaps it would be for the convenience of the House if I take up the offer of the noble Lord, Lord McIntosh, to speak now and, with the leave of the House, perhaps come back later.
The Government's intention to introduce a procedure for deductions from income support was
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announced by my honourable friend the Minister for Local Government during the earlier stages of the Bill in another place. Thus, we have tabled Government Amendments Nos. 96, 104, 105, 106, 108, 111, 113, 114 and 118. These will enable local authorities to apply for deductions to be made from a debtor's income support payments in settlement of an outstanding community charge liability.
We believe that there should wherever possible be equality of treatment between those in employment and those receiving benefit. Attachment of earnings will be available for defaulters in employment and it is right that there should be parallel arrangements for income support recipients. People in receipt of income support will have their benefit increased to help them pay their community charge. It would be quite wrong for them to be able to avoid payment without being subject to the same sanctions as those in employment.
Without the new provisions, where a person receiving benefit has the money to pay the charge but refuses to pay, the local authority would, if distress proved ineffective, have no alternative but to apply for committal. Under the new provision an authority would have the option to apply for deductions from benefit. In view of our discussions earlier this afternoon, I should have thought that this would have been welcomed by noble Lords who spoke on the second amendment we discussed today.
My noble friend Lord Renton will be interested to know that at present, in certain circumstances, the Department of Health and Social Security can make deductions from income support and pay them to a third party; for example, where electricity bills are unpaid or rent is in arrears. The circumstances and manner in which deductions can be made are limited by regulations. The circumstances in which deductions can be made for unpaid community charge will also be prescribed by regulation and much of the new procedure will mirror current DHSS arrangements. In particular, there will be a limit on the amount of any deductions so as to ensure that the remaining benefit does not fall below prescribed limits and there will be an appeal against a decision to make deductions.
I turn now to Amendments Nos. 110 and 115, in the names of the noble Lords, Lord Meston and Lord Ross of Newport. The main amendment, Amendment No. 115, relates back to the substantive amendment, No. 96. That is made clear in the first line of Amendment No. 115, which refers to paragraph 5A, and that is why I can say to the noble Lord, Lord McIntosh of Haringey, that we had assumed the amendments were to be grouped with the government amendments to which they relate.
I understand that the intention of these amendments—I may to some extent be prejudging what the noble Lord, Lord Ross of Newport is going to say, but I think it is relevant—is that deductions from income support should never be made in respect of an ex-spouse's unpaid community charge and that where at the time of the marriage the couple were in receipt of income support, deductions should not be made in respect of the person's own community charge debt incurred during the marriage.

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We believe that Amendment No. 155 is defective. Paragraph 3(a) implies that the person against whom deductions are sought would not be entitled to receive community charge benefit during the marriage, but paragraph 3(b) requires that the spouse might be in receipt of income support. Such a situation could not arise. Your Lordships may not be aware that, although rebates will be calculated on a joint basis for couples, they will be granted to the individual partners. If a couple are in receipt of income support, both partners will receive the maximum rebate; they will each receive a bill for the minimum contribution of 20 per cent., for which, as I have said, they will be compensated in their income support payment. We cannot accept that deductions should not be made in respect of a person's own unpaid community charge, simply because the debt arose while a person was married. The community charge is a personal liability and such changes of circumstances should not affect recovery procedures.
We have already devoted much time to discussing joint and several liability. The arguments are no different where the couple are receiving income support. If a person's charge remains unpaid at the point of separation, then the spouse's liability for it must continue. We would not wish to apply different sets of rules to the different recovery procedures. As I have said, we wish to treat people the same whether or not they are in employment.
However, in the case of deserted spouses, we have said that we will advise local authorities that they should pursue the person who has not paid and not try to enforce joint and several liability against the deserted spouse. This advice will also apply to deductions from income support. Local authorities can be trusted to use sensibly the powers of enforcement set out in the Bill, I do not believe that special provision is necessary as regards the use of the deductions procedure.
Deductions from income support will be a useful additional remedy for local authorities. People receiving income support will be getting help from public funds, as your Lordships will be aware, to pay the minimum 20 per cent. contribution to the charge. Surely it is only fair that remedies for recovering the unpaid community charge from people receiving benefit should be on all fours with those for people in employment who may well be in low paid jobs with only a little more income.
9.15 p.m.
Lord Ross of Newport: My Lords, in the absence of my noble friend Lord Meston, who has been unavoidably delayed, I will attempt to speak to these amendments. I believe that the Minister gave a clue in his response and I am very grateful to him for it. He said that the Government will be giving advice, or words to that effect, to local authorities to pursue the departed spouse where money is still due. That is the fear and that is the object of these amendments. I am glad that at long last the Minister has given some credit to the sense of local authorities. This is the first time that we have had praise for local authorities which use their initiative. Our fear is that they will do just that. It is one of the reasons why these amendments have been tabled. If they are given these
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powers to make direct deductions from benefit, we feel that they are far less likely to attempt to track down the departed spouse. The Minister dealt with that to some extent in his speech a moment or two ago.
The fact remains that under the present provisions in the Bill single-parent families are likely to be forced to live for extended periods of several years or more at substandard levels of income support in order to repay a debt which they could not reasonably have been expected to pay at the time when it was incurred. That is the objective of some of these amendments. We were trying to ensure that local authorities do not have the power to recover the amount owed in respect of either the spouses or the partners charged with the amount by means of direct deductions from benefit without the written consent of the spouse. In addition, the local authorities would not recover arrears in respect of a spouse's own chargeable amount except with the written consent of the spouse. That is the basis of these amendments. From what we heard during the previous debate I believe that they have some substance and there is cause for concern.
Lord McIntosh of Haringey: My Lords, I do not take a strong position as regards the later amendments which have now been spoken to by the noble Lord, Lord Ross of Newport. I feel very strongly that equality of treatment, which is the defence of the Government for the attachment of social security benefits, is a sham. It can only be a sham at this level of income where income support is designed only to provide a minimum subsistence level. Any deduction from that level of income will cause not just poverty but real deprivation.
It is not good enough for the Government to say that the income support has been increased to cover 20 per cent. of the community charge because it is the average throughout the country and because it will cause severe deprivation to all those people living in areas where the community charge is above the average. It is not the fault of such people that they are living in those areas. They cannot take personal responsibility for the activities of the council. I am not making any judgment by saying that the activities of the council are wrong. The final community charge levied is a combination of the needs which the area has and the assessment by the Government of those needs. The community charge is to make up the shortfall, if one wishes to over-simplify the matter greatly. What is at fault behind all this is the insistence—stretching, as I said before, the concept of accountability beyond belief—that everybody must pay over some amount of money and those living in areas with a high community charge will suffer when the minimum payment of 20 per cent. is left.
Lord Renton: My Lords, I am grateful to the noble Lord for giving way. I am following his argument and it seems to me that it does not lead to his moving this amendment, which applies to the use of the order for the attachment of earnings procedure. Quite rightly, it suggests that it should not be applied to social security entitlement. The statement by my noble friend Lord Caithness has made it perfectly clear that that is not the procedure which is being used, but what he described as a parallel procedure. The amendment seems to be quite irrelevant.
Lord McIntosh of Haringey: My Lords, I always listen with care to what the noble Lord says about the drafting of Bills and I accept that a technical difference may be introduced by Amendment No. 96, which means that we have not found exactly the right form of words. However, the purpose of the amendment is very clear. Whether it is in the scope of existing provision for deductions from social security earnings or whether it introduces a parallel provision, the purpose is to ensure that those already on the minimum subsistence level through no fault of their own are not, because of where they live and because of the level of community charge in the area where they live, reduced to a state below the level of poverty of real deprivation. If the wording is wrong, that can always be put right at Third Reading, given the good will of the House. But the principle is so important that I do not believe it would be right for me to withdraw the amendment. I therefore seek the opinion of the House.
9.21 p.m.
On Question, Whether the said amendment (No. 93) shall be agreed to?
Their Lordships divided: Contents, 20; Not-Contents, 39.

DIVISION NO. 5

CONTENTS

Bonham-Carter, L.

Morton of Shuna, L.

Dean of Beswick, L.

Mulley, L.

Dormand of Easington, L.

Pitt of Hampstead, L.

Ellenborough, L.

Ponsonby of Shulbrede, L.

Ewart-Biggs, B.

Ross of Newport, L.

Ezra, L.

Seear, B.

Graham of Edmonton, L. [Teller.]

Stedman, B.

Tordoff, L. [Teller.]

Hatch of Lusby, L

Underhill, L.

Jay, L.

White, B.

McIntosh of Haringey, L.

NOT-CONTENTS

Ailesbury, M.

Hives, L.

Ampthill, L.

Hooper, B.

Arran, E.

Jenkin of Roding, L.

Beaverbrook, L.

Killearn, L.

Belstead, L.

Long, V.

Blatch, B.

Lucas of Chilworth, L.

Brabazon of Tara, L.

Mackay of Clashfern, L.

Caithness, E.

Macleod of Borve, B.

Cameron of Lochbroom, L.

Renton, L.

Campbell of Alloway, L.

Rochdale, V.

Clitheroe, L.

Skelmersdale, L.

Cork and Orrery, E.

Stevens of Ludgate, L.

Craigavon, V.

Swinfen, L.

Craigmyle, L.

Teviot, L.

Cullen of Ashbourne, L.

Thomas of Gwydir, L.

Davidson, V. [Teller.]

Trafford, L.

Denham, L. [Teller.]

Trumpington, B.

Dundee, E.

Ullswater, V.

Elliot of Harwood, B.

Vaux of Harrowden, L.

Hesketh, L.

Resolved in the negative, and amendment disagreed to accordingly.
9.28 p.m.
[Amendment No. 94 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 95:
Page 106, line 53, at end insert—
("(5) The regulations may include provision that a person may appeal to a magistrates' court if he is aggrieved by the making or the terms of an attachment of earnings order, or there is a dispute
1788
whether payments constitute earnings or as to any other prescribed matter relating to the order.
(6) The regulations may include:

(a) provision prescribing the procedure to be followed for initiating an appeal;

(b) provision prescribing the procedure to be followed in dealing with an appeal;

(c) provision as to the powers of the court (which may include provision as to the quashing of an attachment of earnings order or the variation of the terms of such an order).").

The noble Earl said: My Lords, in moving Amendment No. 95 I should like to speak also to Amendments Nos. 96 and 99. As the Bill stands, there is a gap in the provisions relating to enforcement. It is a gap that we have intended for some time to fill, as my noble friend Lord Glenarthur made clear at an earlier stage of the Bill's proceedings. The gap is the absence of a right of appeal if a person against whom enforcement action is taken believes that a charging authority has misused its powers to levy distress and sale of goods or to attach earnings.
The Government believe that such rights of appeal should exist and Amendments Nos. 95 and 99 therefore provide them. I beg to move.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 96:
Page 106, line 53, at end insert—
("Deductions from income support
5A.—(1) Regulations under this Schedule may provide that where a magistrates' court has made a liability order against a person (the debtor) and the debtor is entitled to income support within the meaning of the Social Security Act 1986—

(a) the authority concerned may apply to the Secretary of State asking him to deduct sums from any amounts payable to the debtor by way of income support, in order to secure the payment of any outstanding sum which is or forms part of the amount in respect of which the liability order was made, and

(b) the Secretary of State may deduct such sums and pay them to the authority towards satisfaction of any such outstanding sum.

(2) The regulations may include—

(a) provision allowing or requiring adjudication as regards an application, and provision as to appeals and reviews;

(b) a scheme containing provision as to the circumstances and manner in which and times at which sums are to be deducted and paid, provision about the calculation of such sums (which may include provision to secure that amounts payable to the debtor by way of income support do not fall below prescribed figures), and provision as to the circumstances in which the Secretary of State is to cease making deductions;

(c) provision requiring the Secretary of State to notify the debtor, in a prescribed manner and at any prescribed time, of the total amount of sums deducted up to the time of the notification;

(d) provision that, where the whole amount to which the application relates has been paid, the authority shall give notice of that fact to the Secretary of State.").

On Question, amendment agreed to.
[Amendments Nos. 97 and 98 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No, 99:
Page 107, line 20, at end insert—
("(4) The regulations may include provision that a person may appeal to a magistrates' court if he is aggrieved by the levy of, or an attempt to levy, a distress.
(5) The regulations may include—

(a) provision prescribing the procedure to be followed for initiating an appeal;

(b) provision prescribing the procedure to be followed in dealing with an appeal;

1789

(c) provision as to the powers of the court (which may include provision as to the discharge of goods distrained or the payment of compensation in respect of goods distrained and sold).").

On Question, amendment agreed to.
[Amendment No. 100 had been withdrawn from the Marshalled List.]
[Amendment No. 101 not moved.]
9.30 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 102:
Page 107, line 46, leave out from ("the") to end of line 47 and insert ("constables of the police area in which the warrant is issued").
The noble Lord said: My Lords, I return to the question we debated in Committee in a state of genuine puzzlement after the noble Lord, Lord Glenarthur, sought to assure me that to mention "constables" in the clause was unnecessary because the point was covered by the General Rate Act 1967. The point is that the General Rate Act 1967 requires that warrants of commitment be directed to constables of police and that the execution of the warrants be the responsibility of any person to whom they are directed, or any constable acting within his police area. The amendment is not a mere quibbling with words. It raises the issue of whether the police will be encouraged to co-operate in the issue and execution of warrants of commitment.
We understand from the local authority associations that there are police forces which have indicated their unwillingness to continue to execute warrants issued by a magistrates' court. We understand, and this may be wrong, that that attitude has been encouraged by Home Office circulars.
Nothing in the amendment is antagonistic to the thinking behind the Bill. We are merely seeking to ensure that it is carried out more effectively. If the Minister can assure me that there is no Home Office circular which would encourage the local police not to continue to execute warrants, and if he can go slightly further and say that the Home Office will get rid of any possible confusion by issuing a circular which indicates that the change in the wording of the Bill does not mean that local police forces have fewer responsibilities than they had before, I will happily withdraw the amendment. I beg to move.
The Earl of Caithness: My Lords, to the best of my knowledge I can give the noble Lord the assurance for which he is looking. There is no Home Office circular of the type which concerns him. The provisions in the Bill allow a warrant to be directed to any person the court thinks fit. That will enable the warrant to be directed, if necessary, to the police. I am sure that that action will continue.
Lord McIntosh of Haringey: My Lords, perhaps I may press the Minister further on my second request, that he suggests—I put it no higher than this—to his right honourable and honourable friends that if there is any danger of any lack of co-operation with the police, a circular might be issued, or a message got through to the police forces that there is no substantive difference in the wording of this Bill and the wording of the General Rate Act 1967.
The Earl of Caithness: My Lords, with the leave of the House, I will raise that matter with my right honourable friend.
Lord McIntosh of Haringey: My Lords, I am most grateful to the Minister. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Caithness The Earl of Caithness moved Amendment No. 103:
Page 108, line 27, at end insert—
("Bankruptcy
7A.—(1) Regulations under this Schedule may provide that where a magistrates' court has made a liability order against a person (the debtor) and the debtor is an individual, the amount due shall be deemed to be a debt for the purposes of section 267 of the Insolvency Act 1986 (grounds of creditor's petition).
(2) The amount due is an amount equal to any outstanding sum which is or forms part of the amount in respect of which the liability order was made.").
The noble Earl said: My Lords, I shall speak also to Amendments Nos. 107, 109 and 184. Your Lordships will have realised that Amendment No. 200 was originally grouped with these amendments but, in view of another major concession (concession No. 6) that the noble Lord, Lord McIntosh, has clocked up on the register, there is no need to refer to that amendment.
These are essentially clarifying amendments which, as I hope to demonstrate to your Lordships' satisfaction, deserve your Lordships' support. It may be helpful if I begin by explaining, by way of background, that under Section 267 of the Insolvency Act 1986 a person who is owed money by another person who cannot pay the debt may petition for that other person to be made bankrupt and for the amount owed to become a debt of the bankruptcy. This is an avenue which is open generally to those who are owed money by people whose debts exceed their means.
These provisions do not therefore introduce anything new. They simply make it clear, for the avoidance of doubt, that a charging authority—like any other creditor—may petition for the bankruptcy of a person who has failed to pay his community charge, or non-domestic rates.
It may also be helpful to your Lordships if I explain the circumstances in which a charging authority might wish to petition for bankruptcy. In the vast majority of cases, a charging authority would have no wish to take such a course. When a person fails to pay the personal community charge, for example, the charging authority will recover the money by means of distress and sale of goods, attachment of earnings or direct deductions from benefit.
There will, however, be a small minority of special cases where these recovery procedures will be ineffective—namely, where the debtor has also incurred a number of other debts and has either been declared, or is on the point of being declared, bankrupt. In such a case, all the bankrupt person's assets come under the control of the receiver or trustee in bankruptcy and are used to discharge the debts of the bankruptcy; they cannot be attached or distrained upon by a charging authority.
In these circumstances it is clearly important that the charging authority should be able to have the

1791
community charge debt treated as one of the debts of the bankruptcy, so that it may take its place among all the other creditors and receive a share in the proceeds that result when the receiver or trustee in bankruptcy liquidates the bankrupt's estate.
I am sure your Lordships will agree on the importance of ensuring that a charging authority—which does after all represent the interests of all the other charge payers and ratepayers in the area—should not be treated any less favourably than all the other people to whom a bankrupt person owes money. I believe, therefore, that these are sensible, desirable provisions, and I commend them to your Lordships' House. I beg to move.
Lord McIntosh of Haringey: My Lords, we have no objections to the amendments, but they give me the opportunity, since I was not in the Chamber when the noble Earl made his earlier announcement, to say that this is not Thank You No. 6, because 19 clauses are being withdrawn: it is Thank You Nos. 6 to 24 inclusive.
Lord Renton: My Lords, in view of our discussion on the earlier amendment on which there was a vote just now (Amendment No. 93) it may help the noble Lord, Lord McIntosh, to realise that, if he looks at Amendment No. 105, he will see that the attachment of earnings and deductions from income support are separate remedies.
Lord McIntosh of Haringey: My Lords, we are not discussing Amendment No. 105, we are discussing Amendments Nos. 103, 107, 109 and 184.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 104:
Page 109, line 14, at end insert—
("(aa) deductions from income support may be resorted to more than once;").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 105:
Page 109, leave out line 16 and insert—
("(c) attachment of earnings, deductions from income support and distress (or any two of them) may be resorted to in any order or alternatively (or both);").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 106:
Page 109, line 17, after ("attachment,") insert ("deduction,").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 107:
Page 109, line 17, after ("commitment") insert (", bankruptcy").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 108:
Page 109, line 22, after ("attachment,") insert ("deduction,").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 109:
Page 109, line 22, after ("distress") insert (", bankruptcy").
On Question, amendment agreed to.
[Amendment No. 110 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 111:
Page 109, line 45, at end insert—
("(cc) where a liability order has been made against both, deductions from income support may be made in respect of one of them or of each;").
On Question, amendment agreed to.
[Amendment No. 112 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 113:
Page 110, line 17, after ("attachment,") insert ("deduction,").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 114:
Page 110, line 22, after ("attachment.") insert ("deduction,").
On Question, amendment agreed to.
[Amendment No. 115 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 116:
Page 110, line 31, leave out from ("recoverable") to ("in") in line 32.
On Question, amendment agreed to.
[Amendment No. 117 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 118:
Page 112, line 31, after ("1971,") insert ("Part III of the Social Security Act 1975,").
On Question, amendment agreed to.
Clause 23 [Appeals]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 119:
Page 14, line 44, at end insert—
("(cc) the fact that such a designation has not been revoked,").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 120:
Page 15, line 5, at end insert—
("(ee) the fact that such a designation has not been revoked.").
On Question, amendment agreed to.
[Amendment No. 121 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 122:
After Clause 23, insert the following new clause:
("Death.
(1) The Secretary of State may make such regulations as he sees fit to deal with any case where a person dies and at any time before his death—

(a) he was (or is alleged to have been) subject to a charging authority's community charge,

(b) he was (or is alleged to have been) liable to pay an amount under section 9 above,

1793

(c) he was (or is alleged to have been) liable, as spouse or manager, under section 16 or 17 above, or

(d) a penalty was imposed on him under Schedule 3 below.

(2) Nothing in the following provisions of this section shall prejudice the generality of subsection (1) above.
(3) The regulations may provide that where before his death a sum has become payable by the deceased but has not been paid his executor or administrator shall be liable to pay the sum and may deduct out of the assets and effects of the deceased any payments made (or to be made).
(4) The regulations may provide that where before his death a sum in excess of his liability has been paid (whether the excess arises because of his death or otherwise) and has not been repaid or credited his executor or administrator shall be entitled to the sum.
(5) The regulations may provide for the recovery of any sum which is payable under the regulations and is not paid.
(6) The regulations may provide that proceedings (whether by way of appeal under section 23 above or otherwise) may be instituted, continued or withdrawn by the deceased's executor or administrator.").
The noble Earl said: My Lords, at the same time I shall speak to Amendment No. 178. Both these amendments make equivalent provision in respect of the community charge and non-domestic rates for what is to happen when a person dies who has been subject to the community charge or to rates. These are essentially clarifying amendments which will, I hope, receive the full support of your Lordships' House. They do not reflect any change of policy or provide anything new of substance. They simply make clear what has already been the Government's stated intention. I beg to move.
Lord Tordoff: My Lords, is the noble Earl also speaking to Amendment No. 194, which is grouped with this amendment on the Marshalled List and which has the wonderful subtitle "Death"?
The Earl of Caithness: No, my Lords. I am not speaking to Amendment No. 194 because that is part of the large government concession noted by the noble Lord, Lord McIntosh, as "Thank you" Nos. 6 to 24 inclusive.
Lord Tordoff: My Lords, I am delighted that the Government have conceded death.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 123:
After Clause 23, insert the following new clause:
("Appeals: preliminary steps
(1) No appeal may be made under section 23 above unless—

(a) the aggrieved person serves a written notice under this section, and

(b) one of the conditions mentioned in subsection (4) below is fulfilled.

(2) A notice under this section must be served on—

(a) the charging authority concerned, where the grievance relates to an estimate mentioned in section 23(2)(d) above or to the imposition of a penalty by a charging authority;

(b) the community charges registration officer concerned, in any other case.

(3) A notice under this section must state the matter by which and the grounds on which the person is aggrieved.
(4) The conditions are that—

(a) the aggrieved person is notified in writing, by the authority on which or officer on whom he served the notice, that the authority or officer believes the grievance is not well founded, but the person is still aggrieved;

1794

(b)the aggrieved person is notified in writing, by the authority on which or officer on whom he served the notice, that steps have been taken to deal with the grievance, but the person is still aggrieved;

(c) the period of 2 months, beginning with the date of service of the aggrieved person's notice, has ended without his being notified under paragraph (a) or (b) above.

(5) Where a notice under this section is served on an authority or officer, it or he shall—

(a) consider the matter to which the notice relates;

((b) include in any notification under subsection (4)(a) above reasons for the belief concerned;

(b) include in any notification under subsection (4)(b) above a statement of the steps taken.").

On Question, amendment agreed to.
Clause 28 [Students]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 124:
Page 17, line 18, leave out ("a prescribed person") and insert ("the appropriate registration officer").
On Question, amendment agreed to.
Lord Tordoff Lord Tordoff moved Amendment No. 125:
Page 17, line 26, leave out ("and").
The noble Lord said: My Lords, I beg to move Amendment No. 125 formally.
Lord Tordoff Lord Tordoff moved Amendment No. 126:
Page 17, line 29, at end insert ("and
(e) education may include nursing education.").
On Question, amendment agreed to.
9.45 p.m.
The Earl of Caithness The Earl of Caithness moved Amendment No. 127:
Page 17, line 29, at end insert—
("(3) The regulations may include provision allowing or requiring the appropriate regulation officer to revoke a designation of an individual as a certification officer.
(4) "The appropriate registration officer" means the registration officer for such charging authority as may be prescribed as regards the educational establishment concerned.").
On Question, amendment agreed to.
Clause 29 [Interpretation]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 128:
Page 18, line 1, leave out subsections (6) to (8).
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 129:
Page 18, line 17, at end insert—
("(9A) Whether anything is a caravan at a particular time shall be construed in accordance with Part I of the Caravan Sites and Control of Development Act 1960.
(9B) If at a particular time a person has no fixed abode (in England and Wales or elsewhere) he shall at that time be treated as having his sole or main residence in the place where he is at the time.
(9C) Section 2(6) above shall not apply to a person to whom subsection (9B) above applies at the time concerned.").
On Question, amendment agreed to.
Clause 30 [Amount for personal community' charges]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 130:
Page 18, line 47, at end insert—
("(5) In construing subsection (4)(a) above any precept for which another has been substituted shall be ignored.").
The noble Earl said: My Lords, I beg to move Amendment No. 130 and speak to Amendments Nos. 131, 133, 134, 137 to 151, 206, 228 to 233 and 246. The amendments all concern the issuing of substitute demands on a charging authority's collection fund. Your Lordships may recall that a charging authority and the precepting authorities make demands on the collection funds in their area. Each charging authority levies such community charges that its fund has sufficient moneys to meet the demands being made on it.
The amendments fall into three categories. First, they seek to ensure that where a charging authority receives a substitute demand on its collection fund, the effect of that feeds through to the community charges which the authority sets. Similarly, where a charging authority receives a demand from a major precepting authority after it has set its community charges, the amendments mean that the effect of that late precept will feed through to the substitute community charges.
Clause 33 provides that where substitute or late demands are made on a collection fund the charging authority must set substitute community charges to take account of that. The amendments are designed so that the substitute charges are set by reference only to the substitute or late demand and to the same information which was used when setting the previous charges. That will ensure that a charging authority which has received, say, a lower substitute precept is not able to set a higher substitute
1796
community charge on the basis, for example, that since it last set the community charge it has increased its assessment of the likely losses on collection. Amendments Nos. 137 and 139 are designed to achieve that. They will safeguard the principle that community charges cannot be increased in the course of the year except in very exceptional circumstances; where, for example, the charges have been quashed by a court on the grounds that they were insufficient or set before a precept from a major precepting authority was received.
The second category of amendments—Amendments Nos. 142, 143, 145, 147, 149 and 150—deal with the provisions relating to parish precepts and substitute community charges. The third category of amendments are simply technical and drafting amendments. They seek to make clear that where a substitute demand has been made on the collection fund, the earlier demand is no longer taken into account. In short, they ensure that there will be no double counting and provide a number of drafting improvements. They are all technical amendments designed to improve and clarify the existing provisions by the issuing of substitute demands in the terms of the Bill, substitute precepts or substitute calculations. I commend the amendents to the House, and I beg to move.
On Question, amendment agreed to.
Clause 31 [Setting of different amounts]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 131:
Page 20, line 21, at end insert—
("(11) In construing subsection (3)(a) above any precept for which another has been substituted shall be ignored.").
On Question, amendment agreed to.
Baroness Stedman Baroness Stedman moved Amendment No. 132:
After Clause 31, insert the following new clause:
("Special expenses: parish or community councils.
.—(1) A charging authority which has one or more parish or community councils in its area shall on the request of half or more of the total number of such councils annually and not later than 1st March in each year consult the parish or community councils in its area as to the amount, if any, of its expenses which it would be proper to resolve should be special expenses for the purpose of setting the personal community charges for its area in accordance with sections 29 and 30 above.
(2) The factors to be taken into account in the consultations under sub-section (1) above shall be—

(a) The size and population of any part of the area of the charging authority not included in a parish or community which has a parish or community council;

(b) The functions proposed to be discharged in that part of its area by the charging authority in the next financial year which it does not propose to discharge in some or all of the parishes or communities which have a parish or community council;

(c) The functions proposed to be discharged by the parish or community councils in the next financial year;

(d) The amounts proposed to be spent on the functions described in paragraphs (b) and (c) above;

(e) The distribution of property subject to the national non-domestic rate and the total rateable value of such property in the area of the charging authority and in each of the parishes or communities;

(f) Such other factors as reasonably appear to be relevant.

(3) In default of agreement in the consultations on the amount which should he special expenses under sub-section (1) above, the matter shall be referred to the arbitration of a single arbitrator agreed by the local authorities taking part in the consultations or in default of agreement appointed by the Secretary of State provided that the matter shall not be referred to arbitration by a parish or community council unless it is supported, where there is more than one such council in the area of the charging authority, by at least half of the total number of such councils.".
The noble Baroness said: My Lords, we return to the problems of parish, town and community councils and their need to be able properly to exercise their small-scale local government functions after 1990 when the Bill comes into effect. We all know that those authorities vary both in size and in their circumstances. This amendment, we feel, offers a possible procedure for encouraging discussion and co-operation between the charging authority, which is the district council, and the parish, town or community councils within that district.
If this clause is accepted it offers five relevant factors that ought to be considered in reaching a fairly wide variety of locally determined solutions without being too oppressive on the district council, which will have to manage all the complexities of the community charge. The procedure I suggest in this amendment can only be activated if at least half the local councils in the district request it. If agreement is not reached, arbitration can take place only if the district council or half the parish councils plus one request it.
The amendment provides a very loose framework and will, we hope, encourage local discussion. Any agreed solutions will affect only the one district and will lead only to agreed partial redistribution within the district of the financial resources available to it.
At Second Reading we expressed our concern about the loss to parish councils of the income from the business rate because the benefit from the amounts returned to districts will have the effect in practice of reducing the size of an individual's
1798
community charge at district level and not at parish level. That is especially so for those parishes which have above average quantities of non-domestic property in their areas. In addition, for those with continuing capital commitments, the loss of the share of the business rate will inhibit what they are able to do in the future.
There are 141 shire districts in which not all of the district is divided into parishes. As a result in the unparished parts the district has to carry out functions which may be carried out by parish or community councils in the other parts of the district. If there are no locally acceptable special financial arrangements, the inhabitants of the parishes will have to pay towards the cost of the functions discharged by the district councils in that area which does not have any parishes while paying for the same functions carried out by their own parish council.
I believe that this clause, if agreed, would enable local agreement to be reached on special charging arrangements for that part of the district in setting the level of the community charge for its own functions and for such special charging as is allowed for in the 1972 Local Government Act. They could then make fair arrangements to deal with the effects of both the problem of concurrent functions and the loss of the business rate.
I believe that a procedure is required because experience has shown that, unless there is some form of compulsion on district councils to consult with the parish and community councils and agree what that should be, they are much more likely to ignore the reasonable cases and refuse to make special arrangements. Experience also suggests that the arbitration provisions may not be used without some form of pressure to do so.
I raised this matter at Committee stage. The noble Earl said then:
"the Government are taking this matter up with the Association of District Councils with a view to seeking to agree with the association guidelines for councils to give some specific recognition to parish services when setting the community charges".—[Official Report, 13/6/88; col. 138.]
I hope that the Minister will be able to tell us tonight that those discussions have gone ahead and that guidelines have been agreed. If that is not the case, I hope that he will be prepared to accept the amendment I put forward. I beg to move.
Lord Jenkin of Roding: My Lords, as a vice-president of the National Association of Local Councils I was asked at an early stage of this Bill whether I would support an amendment which would oblige district councils to hand over a predetermined part of the proceeds of the community charge to the parish councils. I made very clear to the officers of the national association that in no way could I support that amendment. It seemed to me that it would disrupt the whole structure of the system which has been embodied in the Bill. I believe that that argument was accepted. Nevertheless, it was impressed upon me that unless there is some procedure—and, as the noble Baroness, Lady Stedman, has pointed out, this is essentially a procedural amendment—there will be, as there has

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been in the past, considerable reluctance on the part of district councillors to recognise differences that exist between the different parts of their areas where there are parish councils or, if there are indeed parish councils over the whole area, the differences between the needs of those parish councils.
It seems to me therefore that there is a good deal of merit in the proposal which the noble Baroness has put forward. I have not heard the arguments against it other than those marshalled at Committee stage, but I was interested to hear that there have been further discussions between the national association and the Department of the Environment. I shall listen most carefully to what my noble friend says from the Dispatch Box. It seems to me prima facie that there is merit in the argument for some kind of procedure to give an opportunity for the case to be put in a way that requires the district to listen and, in the event of disagreement, for there to be arbitration by a third party.
Lord McIntosh of Haringey: My Lords, I should like to add my support to the amendment moved by the noble Baroness, Lady Stedman, which I understand is supported by the noble Lord, Lord Jenkin. I t seems to me that the amendment is as reasonable as one could possibly imagine. It provides for a consultation procedure which in almost every case ought to result in agreement without dispute between the district council and the parish council. However, it then provides, in the case of last resort, for an arbitrator who, if necessary, could be appointed by the Secretary of State so that the matter will not drag on and may he resolved within a reasonable period of time.
At Committee stage the noble Earl was good enough to say that he felt sympathy with the problem which had been revealed by the noble Baroness because he lives in a parish council area and would suffer if there were no adequate agreement. None of us wants to see the powers of parish councils diminished, their financial resources arbitrarily and accidentally reduced or their lives made more difficult. That is not the intention of the Government, but such lack of intention may not cover a failure to avoid that unpleasant and unnecessary result.
At Committee stage the Minister said that he would go back and continue to discuss the matter with the Association of District Councils. I suggest that that is not good enough. The Association of District Councils might agree with him a procedure but unless it has some greater force in the form of something like this amendment, individual district councils might ignore the guidelines drawn up by the ADC together with the Government. That is the difficulty of relying on consultation. I hope that the Minister will acknowledge not only the force of the point behind the amendment but also that it is a very serious and responsible attempt to resolve the difficulty without too much bureaucracy and conflict.
Lord Tordoff: My Lords, perhaps I may add my voice from these Benches in support of the principle behind the amendment. As I have said before, parish
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councils are, or ought to be, one of the most cherished parts of our democracy. It is that part of our democracy that is nearest to people living in their homes, particularly in rural areas. Indeed, I should very much like to see an extension of the parish council principle brought into our urban areas.
We all understand the problems of the loss of business rate to certain parishes, which could be catastrophic in many cases. With the best will in the world, consultations with the district councils may not be enough because they are under enormous pressure by way of government restrictions on their spending. Unless there is something written on to the face of the Bill which insists on them taking the financing of parish councils seriously, these things may go by default.
I know that the Government, and particularly the noble Earl, are sympathetic to this cause but I hope that either he can accept this amendment or come back with something that can go on to the face of the Bill at some stage.
10 p.m.
The Earl of Caithness: My Lords, this amendment returns to a subject that arose in Committee. At that time your Lordships will recall that I was able to respond positively to the noble Baroness's arguments, and she was also good enough to say that she was pleased with what I had to say. However, I hope that she will not be too disappointed when I say that I cannot accept her amendment for the reasons I shall elucidate.
The amendment deals with a long-standing problem and would have been equally pertinent to any number of local government Bills that have gone before this one The problem it addresses is that in the majority of district councils, some services may either be provided by district councils or, where there is a parish council, by the parish. The district has the power to reflect the fact that it does not provide all its services everywhere in the district by declaring the cost of such services to be special expenses which will be recovered only in the areas which benefit from the relevant services. This would lead to different rates or, in the future, community charges being set in different areas of the district, and would also avoid "double taxation" in those areas paying a parish precept for services which are provided elsewhere by the district.
This seems an entirely reasonable procedure, but districts do not apparently make wide use of these powers. Perhaps the most common reasons put to us for this are the difficulties in deciding who actually benefits from a particular service, and the sheer complexity of determining what expenditure should be charged to which area. It may seem a simple matter, particularly if there are only a few parishes in the district, but I am prepared to accept that there are real obstacles to adopting this approach where there are, as there are in Harrogate, 120 parishes in one district.
The number and diversity of parishes have always presented difficulties to any attempt to regulate their financial affairs by statute or by central administrative action. There are more than 8,000

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parishes with populations running from tens of thousands to fewer than 10, and with precepts of more than 20p to nothing. Against this background of diversity, parishes and districts have made their own arrangements at local level to meet local circumstances. On the whole that informal approach has worked, not perfectly but I would certainly say better than anything that could have been imposed from the centre.
However, I have already accepted that these informal arrangements are not working satisfactorily in respect of the setting of special expenses. But I cannot accept that this attempt to compel consultation and ultimately impose arbitration is the right way of improving the position. It is an ingenious attempt, but I have to say to the noble Baroness that I do not think it will work.
First, the requirement for half of the parishes in a district to request consultation may be difficult to achieve in practice in a district like Harrogate. It also provides no relief for individually dissatisfied parishes if they are in a minority. I also wonder whether 1st March may be too late to start consultation. Districts have to set their community charges by 1st April. They would therefore have to complete consultation with possibly a large number of individual parishes and allow time for the completion of arbitration in just one month.
On the other hand, if consultation had to start earlier, that too might be difficult because the districts themselves would not necessarily by that stage have decided how much they spend on particular services and in what areas. These problems can of course be overcome by good will within the context of informal arrangements, but they are extremely difficult to legislate for. Nor is the concept of arbitration necessarily appropriate in cases of difficulty. Arbitration is fine when there are two or three points of view, but how could an arbitrator manage if there were 20 or more parties to a dispute? I can certainly say that the Secretary of State would not wish to become the arbitrator as a last resort, as suggested by the amendment. The officials of my department have many admirable skills, but they assure me that they would not feel qualified to determine these very local disputes.
Our view is that these matters are best regulated locally. Of course we need proper ground rules. When this matter arose before, I told the House that we were taking the matter up with the Association of District Councils. The noble Baroness and, indeed, my noble friend Lord Jenkin of Roding will be pleased to hear that my officials have now made contact with the association and the other associations concerned, including the National Association of Local Councils and a meeting will be convened to seek to agree clear, voluntary guidelines.
We have taken the point of the amendment. We have put action in hand. I ask that we should now be given time to develop a voluntary approach on local agreements.
Baroness Stedman: My Lords, I am grateful for the Minister's response. I did not expect that he would accept the amendment. The noble Lord, Lord
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Bellwin, and I had long discussions during the passage of the Local Government, Planning and Land Act on a similar point and could not get anywhere between us. I thought that it was worth having another go to try to obtain something to give the parishes and community councils some satisfaction.
I am delighted that the Minister has managed to set up the meeting between the district councils and the National Association of Local Councils. I am sure that with sensible discussion they can work out something for themselves. If we have achieved that, perhaps that is as far as we can expect to be able to go tonight. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 32 [Power to set substituted amounts]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 133:
Page 20, line 23, leave out from ("year") to ("may") in line 24 and insert ("under section 30 above, this section or section 33 below").
On Question, amendment agreed to.
Clause 33 [Duty to set substituted amounts]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 134:
Page 20, line 36, leave out from ("year") to ("and") in line 37 and insert ("under section 30 or 32 above or under this section").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 135:
Page 20, line 45, leave out paragraph (b).
The noble Earl said: My Lords, in moving the amendment, I wish to speak also to Amendments Nos. 204, 210 and 223. With the leave of the House, I shall take the opportunity to speak to Amendment No. 248, which was unfortunately omitted from the group. I apologise to the House for the late inclusion of Amendment No. 248. As your Lordships will see, it does exactly the same as the other amendments in the group.
The amendments are straightforward and remove references in the Bill to the Inner London Education Authority as a precepting authority. This is in keeping with our intention as embodied in the Education Reform Bill to abolish ILEA after 1st April 1990 and to hand over responsibilities for education functions to the inner London boroughs. This will allow each borough to decide how best to organise its services rather than automatically having to contribute to the high-spending ILEA. Each borough will be able to be more responsive to the local needs of its parents and children and more accountable to its community charge payers for the service that it gives.
As I said, the amendments are straightforward and seek to remove references to ILEA which are no longer necessary. I beg to move.
Lord McIntosh of Haringey: My Lords, the noble Earl is I think jumping the gun. Third Reading of the Education Reform Bill will not take place until next week. The Minister does not know any more than I

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do what the result will be. It is possible that we may succeed in persuading the Government by the force of reason and argument that they are wrong in seeking to abolish ILEA. These amendments should surely be tabled on Third Reading if appropriate, rather than before the Education Reform Bill has completed its passage through the House.
The Earl of Caithness: My Lords, I obviously took careful advice before seeking to put down the amendments. Should the noble Lord, Lord McIntosh of Haringey, be more successful than his party was at the Committee and Report stages of the Education Reform Bill in persuading the Government to change their view, should that be allowed by the procedures of the House, account will be taken of that later in the Bill.
Lord McIntosh of Haringey: My Lords, if the noble Earl is saying that he will then move to restore Clause 33(2)(b), I shall have to ask him how much it costs to put down an amendment to the Bill.
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 136:
Page 21, line 3, after ("Authority") insert—
("(ff) a metropolitan county passenger transport authority.");.
The noble Lord said: My Lords, it will be within the recollection of the House that on 7th June, at a rather later hour than this, my noble friend Lord Teviot moved an amendment to restore the passenger transport authorities into the Bill at those several points whence they had been removed by a Government amendment passed at Report stage in another place.
I am speaking also to Amendments Nos. 185, 201, 204A, 204B, 211, 224–227, 247, 249 and 250. Briefly, the significance—and the inclusion of the PTAs among, or their removal from, the various amendments—is that as the Bill was originally presented in another place, the passenger transport authorities were left as precepting authorities with the role that they had had under the Local Government Act 1985. The purpose of that was, as the House will remember, that passenger transport authorities were joint boards set up in the metropolitan regions to provide the transport services over the whole of those areas. Their membership consisted of representatives appointed by the district councils in those areas.
The precepting power had been foreshadowed in the White Paper, Streamlining the Cities, and it was argued fairly strenuously within the Government before that came as to whether or not a charging power would be better. We decided on precepting because we felt that precepting would enhance the responsibility for the transport services over the area as a whole. We argued at the time that to make this a charge which would be included in the district rate—or, as it will be now, the community charge—would be to enhance the dangers of parochialism, the chance that accountability would be felt over too narrow an area and would be lost over the wider area.
That was what was accepted by both Houses in the 1985 Act and it has stood until now. But the Government consulted widely in January on a proposal that this should be changed and that in place of the precepting power should be a levying or charging power. The amendments were moved at Report stage.
The arguments for this have been stated quite simply: they are that it will enhance accountability and therefore that it is in line with the main tenor and thrust of this Bill—a tenor and thrust which, as I think noble Lords will recognise, I totally support. Because I want to see progress on the Bill I have not played as full a part in the Report stage as perhaps others might have expected, but on this amendment I have come to the conclusion—despite the advantage of a number of discussions with my noble friend Lord Brabazon, with the Secretary of State and with his Minister of State at the Department of Transport—that I remain to be convinced that they are right.
The central argument of the Government is that without this local accountability that would be created by the charging power, the district councils are tending to distance themselves—I use the phrase that is being used in a number of places, in another place and this House—from the decisions of the PTAs on which they are represented. The argument which I and others advanced on 7th June was that it is too soon to draw that conclusion for the obvious reason that we have not yet completed the transitional period—the three years from the implementation of the Local Government Act in 1986—and that for the first three years the precepts of the joint boards, including the passenger transport authorities, were in effect being capped by the Government.
I ask the question again: why should a district council unduly concern itself with the level of a precept if it knows that the precept has been fixed by the Government? Therefore I believe that it is a little unreal to argue that district councils do not appear to have taken much notice of the decision of the precept. Why should they? It has been fixed by the Government.
The amendment tabled by my noble friend Lord Teviot would have restored the Bill to what it was before the Report stage in another place. During the debate I suggested that there might be a halfway. The Government may be right in saying that after the three-year transitional period has finished there may be evidence that district councils are simply passing on the precept and not accepting the responsibility for it as intended in the earlier legislation. Therefore it would be necessary to bring forward further primary legislation in order to transfer this from a precepting to a charging power.
I suggested that the simplest solution may be first, to restore the precepting power and to take an order-making power to provide that it should not be used for two or three years. That would allow plenty of opportunity for the system to operate without the precept-capping. If that then appeared necessary in order to enhance accountability and if the fears of Ministers were realised, they would be able to achieve it by an order and not by primary legislation.

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Amendment No. 250, the last in the group, provides for that. At the end of the Bill there would be a new clause providing an order-making power requiring an affirmative resolution in both Houses.
It may be argued that that would have to be operated for all authorities, even though it may be necessary only in the case of one or two PTAs. My response to that argument is that I do not see why the Government should be frightened of what would be a hybrid order. It is quite a step to change from a precepting to a levying authority. It does not seem to me to be in the least unreasonable that, in seeking to apply it to two or three PTAs and no others, the Government should be asked to argue the matter before a special committee of both Houses. It would not be an onerous obligation. It would ensure that those affected had an opportunity to be heard and to argue their case. However, in the Bill the Government are providing that automatically for all PTAs without waiting for evidence. It seems to me that that is not on.
What alarms some people—it alarms me also—is that it appears that this would lead to a much greater risk of districts seceding from the PTA, as they have the power to do under earlier legislation. When I read the consultation paper, issued by the department in January, my fears were enhanced. Paragraph 5 reads:
"The changeover to direct billing will put districts into a better position to make an assessment of whether secession would better meet their interests. Districts may in particular regard secession as desirable because decisions on bus services needed for its population would he made by a body more closely in touch with its residents".
It seemed to me and to others that that was almost an open invitation to secede. Therefore, the change in the law foreshadowed in the consultation paper was taken by many people as providing encouragement to districts to secede from the PTA. Therefore, one asks, "Where does that leave the area-wide services?" Ministers then come back with a rather different answer. After my meeting with Mr. Channon, the Secretary of State for Transport, he was kind enough to write me a letter in which he said this:
"I have considered carefully the concern you expressed about parochialism and secession. I am as anxious as you are to ensure that facilities which are best planned and financed on a conurbation-wide basis should not be put at risk".
That is a rather different song from the consultation paper and I believe that the House will recognise that. He went on:
"I am told that when the 1985 Act was implemented there was, as now, great concern that this would he undermined by widespread secession. But in the event it did not happen"—
that is perfectly true. He concluded:
"and I would not expect it to happen as a result of this change".
With the greatest respect, that is a complete non sequitur. One purpose of the change is, as was foreshadowed in the consultation document, to invite authorities to look very carefully at whether secession might prove the better answer.
Therefore, I find it very difficult—and I say this with some regret to my noble friend on the Front Bench—to accept the argument that this will not lead to secession. It seems to me that it may well do so and there has been some encouragement towards that.
In these circumstances, I believe that the right answer is to leave these PTAs as precepting bodies for
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the present and to give the Minister a power by order needing the approval of both Houses to make the change to a levying authority. They will then have had time to see whether, at the end of the transitional period under the earlier Act, there is a lack of accountability and a need therefore to strengthen it by forgoing, to some extent, the advantages of conurbation-wide policy and service in order to have a closer accountability of district councillors to their electors.
However, there is a risk. There will be a cost, because instead of looking at area-wide services will there not be a risk that a councillor will realise that what will be exercising the mind of the electors in these circumstances will be the location of the local bus stop and whether the service comes down his road or another road? There will be absolutely no concern as to whether outlying districts at the other side of the conurbation are receiving a proper service. Councillors will have all the pressures to look as parochially as possible and not to take the area-wide service.
It was no surprise to me that after the last debate I received a number of letters from various bodies which had been concerned about the change in the Bill introduced in another place. One matter which struck me particularly was from the Wharfedale Rail Users Group writing from Ilkley in West Yorkshire. After making the point that the consultation document gave encouragement to secede, the letter said:
"Quite apart from the obvious risk to the future of county-wide ticketing and concessionary fares, we do not believe that district councils are the right bodies to oversee public transport",
the implication being that they need these separate area bodies. That is what is provided. The letter also said:
"the West Yorkshire PTA at present has a good relationship with the district councils. We are keen to see this relationship continue, rather than see it undermined by the undoubted tension that would be caused if district councils have to weigh up public transport against other spending priorities".
Of course in a sense they have to do that sitting in two different bodies, but at least when they sit in an area-wide body they are looking at the services on an area-wide basis. If charging was introduced—and I put it no higher than this—there is a considerable risk that that important principle of the earlier legislation will be undermined. I should be very unhappy to see that happen. Even at this late hour, second time around, and recognising that this is a compromise, we are not asking the Government to withdraw what they have put but to accept the status quo for the time being. If by 1992 there is evidence that the system is not working, they would have the power by subordinate legislation to seek to achieve the changes which they are now seeking. I beg to move.
Lord Underhill: My Lords, I am certain that the House is grateful to the noble Lord, Lord Jenkin of Roding, for going through the history of this amendment and also for recalling the powerful speech that he made in Committee which so much impressed noble Lords that there were nine speakers on the amendments at that time. Not one of those speakers supported the attitude of the Government in proposing the change from precepting to levying.

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I am certain that many noble Lords will agree that the noble Lord has put forward such a powerful case tonight that the Government must recognise that the situation has changed from that which was put forward in Committee. The proposal in Committee was, as he said, merely to ask that the Government should reverse the situation and go back to precepting and not billing. When the noble Lord made the suggestion that we ought to have powers concerned with regulations to look at the position in future, noble Lords may remember that I immediately jumped to the conclusion that it was worth while and, without consulting my colleagues, I said that if he brought forward such an amendment I would give it my support from the Opposition Benches. That is why my name appears on the amendments now.
As the noble Lord rightly said, the most important amendment of the 13 is Amendment No. 250. The other amendments merely lead up to Amendment No. 250, putting the position hack to precepting. Amendment No. 250 gives the Secretary of State the opportunity after 1992, if the situation so requires, then to propose that a PTA should change to billing and not the precepting which we are asking for in the other amendments.
I suggest that no one in Committee questioned the establishment of the PTA/PTE structure or its functioning. No one questioned whether the PTAs and PTEs were carrying out a cross-county function as set up under the 1985 Act. Even the Minister said:
"We do not seek to disturb the structure which we established then.—[0fficial Report, 7/6188; col. 1373]
The word "then" refers to the 1985 Act. I remind noble Lords of what the noble Lord, Lord Jenkin, said about the consultation paper and the encouragement for secession. The only argument that we had from the Minister in Committee was based on accountability, with the suggestion that districts had expressed a wish to distance themselves from the PTAs in their own areas.
I recall, and other noble Lords may recall, that the noble Lord, Lord Jenkin, asked for some examples of where districts had sought to distance themselves from the work of the PTAs and the PTEs. No examples were forthcoming. I remind the House that, as president of the Association of Metropolitan Authorities, I attend whenever I possibly can the public transport committee of that body. I can honestly tell the House that I have not heard of any case of a district council expressing a desire to distance itself from the PTA and secede from it. Even though there may be criticisms of certain aspects of their work, the districts recognise that without the county-wide structure of PTAs the perils outlined by the noble Lord could take place and some of the most important services could be lost.
I urge the Government seriously to consider this amendment. It is as flexible as one could wish it to be. I understand the Government resisting our amendments at the Committee stage and saying, "No, we are not going to continue with precepting, we wish to have levying and billing." However, now they are being given an opportunity. After the three-
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year transitional period I am prepared to accept that, if the PTAs and the PTEs do not continue to serve their functions and do not have proper consultations and proper contact with the districts—up to now there is no question at all but that effective consultation with the districts as regards transport policy plans and budgeting appears to have taken place everywhere—so that the PTA and PTE structure is shown to not be working efficiently, there should be a change from precepting to levying.
I believe that these organisations should be given the chance to carry on the work they are now doing, bearing in mind the important point made by the noble Lord that, under the three-year transitional period, they are in effect rate-capped because the Government have fixed the expenditure limit for the PTAs. I hope that the Government recognise the force of the argument that has been put forward and that they will accept these amendments.
10.30 p.m.
Lord Teviot: My Lords, after two excellent speeches from my noble friend Lord Jenkin of Roding and the noble Lord, Lord Underhill, I have to be brief or I may lose this point. At the Committee stage I tabled a different amendment. This one is much more succinct, more workable and much more in the spirit of the Bill. I believe it is an amendment that the Government have every reason to accept.
First, as my noble friend pointed out, it gives much greater flexibility. We can see how reasonably passenger transport authorities act on their expenditure decisions for three years, first before introducing the community charge and, secondly, after it has been introduced. That should allow a fair judgment to be made.
Also, the Government lose nothing because they can, with the agreement of both Houses, introduce levying at any time after two years should they feel that it is necessary. I am sure that, if it was then introduced, it would be a considered decision based on sound evidence rather than a decision based on supposition about how PTAs might behave. I believe that in those circumstances it would gain wide support in this House, where we do try to judge matters on their merits.
Thirdly, this amendment will give us another three years without any major structural change. This will be invaluable as the bus industry and the passenger transport executives and the passenger transport authorities adjust to the rapidly changing competitive market. It will, for a time at least, avoid the problems which levying will create and to which I alluded in introducing my own amendment. We are avoiding change for the sake of change. If change comes, it will be soundly based.
With respect, I remind the House that when my amendment was proposed to the Committee it received support from all sides. Since then, I have further pursued my research into the relationship between district councils and PTAs. The present division of responsibility between them appears wholly correct. The PTAs deal with transport, which is a county-wide function. There is a positive and

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constructive relationship between the two types of authority based on extensive consultation with the districts by the PTAs, within, in some cases, a formal joint committee structure dealing with social services, education and highways, with the PTA taking decisions in the best interests of the area as a whole, as the Government intended when the Local Government Act was passed. Levying will in no way improve accountability for country-wide decisions; indeed it will endanger those decisions and obscure the real issues.
Finally, I sincerely hope that the Government have, as promised, given the amendment serious and sympathetic consideration. I give it my full support. It is certainly not a watered-down version and it is very much an improvement on my own.
Lord Tordoff: My Lords, I rise to support the amendment and in doing so mention that, as I clearly did not give the correct instructions, my name appears on Amendments Nos. 204A and 204B but on none of the other amendments in this group. That is a total oversight, as I wish to support the amendment and all its adjuncts.
Those of us who spent a long time on the 1985 Act will remember that a good deal of time and energy were expended on trying to preserve integrated public transport in those areas where services ran outside the district. I remember spending a long time discussing the fair town of Glossop. I see the noble Earl nodding his head in memory of that fair town which, apart from a viaduct of great beauty, also has services controlled from Manchester. It illustrates the way in which services run over wide areas as part of the social fabric of a great conurbation of that kind. We fought very hard to try to ensure that those services did not disintegrate in the reforms put forward in the Bill before it became an Act.
I beg the Government once again to pause before they reject the amendment out of hand, or at least to find some way of doing what the noble Lord, Lord Jenkin of Roding, suggested to the House. There is a serious danger that the integrated services in the conurbations of this land will be seriously damaged by districts opting out under pressures from their local electorates. As I said at the Committee stage, I do not believe that accountability will be increased by these measures because accountability is expressed only through one vote in one ballot box once very four years. The weighting that is given to the public transport services and the cost thereof will not make a vast difference to the decision made by the individual member of the electorate.
I should have preferred the original amendment in the name of the noble Lord, Lord Teviot, but I recognise that we are beyond that point now. I think that the amendment of the noble Lord, Lord Jenkin, is a nice amendment. It has within it a threat to PTAs which do not behave themselves. The provision will be triggered off if they do not do what many of us believe they are doing today and will continue to do; that is to say, give a fair return and a decent service. There is the possibility of an order from the Secretary of State which will do all the damaging things that we have referred to but at least will keep the price under reasonable control. With that threat hanging over
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them, I hope that those PTAs which step out of line in the future will be brought back into line. It is because of that as much as anything that I support the amendments.
Lord Brabazon of Tara: My Lords, my noble friend Lord Jenkin has as ever presented a persuasive case for the amendments in his name and he has been supported by the noble Lord, Lord Underhill, my noble friend Lord Teviot and the noble Lord, Lord Tordoff. Noble Lords will recall that in Committee I gave an undertaking to my noble friend that we would carefully consider the amendments on their merits. I can assure the House that we have done so. Indeed, as my noble friend has reminded me, my right honourable friend the Secretary of State and I met my noble friend to discuss these amendments at some length. We should have liked to have been persuaded of their merits rather than have to oppose my noble friend, whose fine speech on the Second Reading of the Bill remains with many of us. But reluctantly we were not so persuaded. I shall now set out the reasons why.
I spoke in Committee of districts having distanced themselves from PTA spending decisions. I was picked up on this point by several noble Lords. My noble friend Lord Teviot in particular has given examples of the amount of consultation carried out by the PTAs. I accept that there is much consultation and that districts can be very involved in PTA decisions. I also accept that the use of the word "distancing" may have given the impression of a lack of involvement. What I believe districts lack is not interest and involvement in the services that the PTAs support but a sense of responsibility for PTA spending—the kind of responsibility which can only come when you are accountable to the electorate for your spending.
My noble friend Lord Jenkin has argued that we are being premature in moving to direct billing. His reason, as he has explained, is that three years of automatic precept control have given districts no opportunity to demonstrate that they can take responsibility for PTA spending.
I do not argue that three years of precept control have given districts an opportunity to show responsibility. But I can argue with my noble friend's conclusion that we should risk the saving achieved by precept control in order to give the PTAs the opportunity of proving themselves ready, or otherwise, to grasp the nettle of controlling their expenditure. There is every sign that it is a nettle the PTAs will not grasp. All the indications suggest continued moves for greatly increased expenditure. Indeed, only last week Tyne and Wear PTA approved planned expenditure for 1989–90, 15 per cent. up on this year, while Greater Manchester's plan sets out a 60 per cent. increase over the next two years to nearly £129 million in 1990–91. My noble friend's faith in the ability of all the PTAs—
Lord Teviot: My Lords, I am sorry to interrupt my noble friend, but talking about the Greater Manchester plan—I do not know about Tyne and Wear, but Tyne and Wear has a metro—does the light rapid transport railway come into those figures?
Lord Brabazon of Tara: My Lords, I cannot say whether it does. All I can say is that we are not entirely certain whether that is a relevant question. However, I have just been told that it does not come into that figure, so we are still thoughtful about the 60 per cent. increase over the next two years. While I greatly respect the view of my noble friend Lord Jenkin based on his valuable work on local government reform up to 1985, I cannot agree with him in this case.
The experience of the recent years of precept control, the attitudes demonstrated by the PTA representatives who have come to speak with us and the future expenditure plans of the PTAs all point to a strong tendency toward substantial expenditure increases once more—exactly what we have worked hard and successfully over the past three years to eradicate.
I firmly believe that billing is the way of creating much needed responsibility for PTA spending. Perhaps I could offer the House the following scenario to show why I believe this. I would ask noble Lords to cast their minds forward in time. It is the spring of 1990. Almost two years previously noble Lords in their wisdom had opposed amendments attempting to allow PTAs to continue as precepting authorities. In a smoke filled room, district representatives are now thrashing out the PTA budget. All the representatives are aware that the decisions they take will result not just in higher or lower demands on the chargepayer, but in higher or lower demands from their respective districts. Several districts are eager to keep their expenditure down, being only too aware that voters now have a direct financial stake in the decisions of their councils and will not accept a charge far in excess of the assessment. The result I suggest is that PTA members will adopt a sensible and responsible attitude to PTA spending and will ensure that it does not rise above reasonable levels.
Compare this with another spring of 1990, two years after noble Lords had decided to accept amendments. The members of the PTA are still aware that an increase in their expenditure will mean an added burden on the chargepayer, but they are largely unconcerned. They know that they can plausibly blame the higher precept on the PTA as a whole—after all, the PTA's expenditure is separate from the individual district expenditure, so how can it be seen to be in their control? There is no pressure against increased spending and central government will have little alternative but to intervene with charge limitation, the problems of which my noble friend is only too aware.
Lord Underhill: My Lords, is the Minister projecting a possible scenario or does he have definitive evidence that this is what will happen with PTAs and districts?
10.45 p.m.
Lord Brabazon of Tara: My Lords, I was attempting to project a possible scenario of what might happen in two years' time with or without the acceptance of the amendment. I firmly believe that these are the alternative paths we will be treading and which path we tread will depend on the decision
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taken by your Lordships this evening. A separate PTA precept cannot and will not instill the degree of responsibility necessary for PTA expenditure to be brought under control without further government intervention. That can only be achieved by the change to billing which leaves the electorate in no doubt that it is the districts which have the responsibility for the scale of the PTAs' spending.
I believe that most of the concern about the change to billing is related to worries about the likelihood of secession; in other words, the district leaving the PTA with the possible loss of area-wide services. But secession has been available since the new PTAs were set up under the 1985 Act. There was some initial interest and districts still from time to time come forward on an informal basis but there has been no secession. I cannot say that there will be no secession or that there should be no secession, either with or without the change to direct billing. Parliament has provided the option of secession and I am sure noble Lords will appreciate that any application must be treated on its merits. I repeat, however, that we do not expect secession to be widespread. I must remind your Lordships that each time previously there has been an interest in secession the idea has not been pursued once those concerned looked more closely at what it would involve.
Secession is, and has always been, the ultimate step for a district unhappy with PTA performance. That is entirely in keeping with increased accountability and better value for money, and that is why we highlighted the option of secession in the consultation paper. But, as my right honourable friend said in his letter to my noble friend, we are as anxious as my noble friend to ensure that facilities which are best planned and financed on a countywide basis should not be put at risk as a result of secession.
I gave an undertaking in Committee that we would have to be satisfied that appropriate arrangements had been made for conurbation-wide services and responsibilities before secession would be allowed. I was reluctant to go further for fear of fettering my right honourable friend the Secretary of State's discretion. But I realise that this is an area where greater detail of the likely treatment will be welcomed. If a district wished to secede either entirely or in part from the PTA, I can give an undertaking that secession arrangements would provide for the continuation of desirable conurbation-wide services such as rail services and major infrastructure items.
I know that my noble friend was concerned that billing might lead to increased parochialism. But whatever financial system is in operation, the PTAs can only be accountable to the electors through the districts. It is the district councillors who are elected and who make up the PTA. Increased accountability to the electorate must lead district representatives to look on PTA policies from their district electorate's point of view. I do not, however, believe that increased accountability, whether under direct billing or, as my noble friend suggests, under a precept, need preclude the PTA from taking a conurbation-wide view which is in the best interests of all. Indeed one might consider that it is only through each district being able to weigh its own service needs with the

1813
expenditure required to meet them that a conurbation-wide system can be reached which best satisfies the area's needs at a realistic price.
As I said, I respect my noble friend's view on the willingness of districts to control PTA expenditure; yet I am a little surprised by it. As my noble friend reminded us in his speech on Second Reading, he was the architect of rate-capping. Rate-capping was a response to massive overspending by a number of authorities. Among the authorities which have been capped over the last few years, as I am sure noble Lords are all too aware, are several of the districts which he believes will be ready to exercise control over PTA expenditure.
The community charge will bring such high spending districts to heel but they will not come willingly. It will be the pressure of the electorate—the fear of the wrath of the electorate—which will bring a new realism. So long as PTAs remain as precepting authorities that pressure will he blunted, dissipated, by the lack of that clear relationship between PTA expenditure and district involvement which the move to direct billing will bring. With the move to billing districts will be unable to persuade the electors that they, the districts, have no control over PTA spending. Their share will be part of the district's expenditure.
Without the move to billing I foresee the need for continued control over PTA expenditure. More central control will mean more acrimony, more resentment, more ability for PTAs to blame central government for their unpopular decisions. A move to billing after even two years of the new system as proposed by the amendment will come when we have already trodden a long way along a sorry path.
The time to make the change to direct billing is at the start of the new system. There is, I contend, no reason to wait and see what will happen. The future is quite clear from the spending plans even now being prepared by PTAs. Delay as proposed by these amendments will only mean a double upheaval for financing in the metropolitan areas.
I apologise for having spoken at some length on this amendment, but I believe it is an important issue, as my noble friend said. Having given this explanation, I hope my noble friend will feel able to withdraw the amendment. I am afraid I cannot accept it.
Lord Tordoff: My Lords, before the noble Lord sits down, perhaps I may revert to the question asked by the noble Lord, Lord Teviot, in relation to Greater Manchester. He will admit that he has given a rather alarming figure for the increase in that area. Is it possible that that figure comes from a first draft budget and that although it does not contain charges for the LRT, it includes potential financing charges for the setting up of the LRT?
Lord Brabazon of Tara: My Lords, my information is, as I said, that it did not include the costs of the light railway. But I am quite prepared to double-check on that. I do not have the information with me at the moment. Having said that, it was an increase of 60 per cent. in the next two years. None of the PTAs,
1814
with the exception of the West Midlands, has put in for an increase below 15 per cent. The West Midlands was only just below that for next year.
Lord Jenkin of Roding: My Lords, I have listened to my noble friend with great care. He has absolutely no need to apologise for having addressed the House at some length because he clearly had some arguments of substance to put to us. The only point on which I found myself wondering why he had included the passage in his speech was when he referred to rate capping and to my speech on the Second Reading of the Bill.
The point I was seeking to make was that it was because of the lack of accountability in the rating system and the rate support grant system as it exists at the moment that we had to introduce rate capping. That was why we embarked upon the studies that led to this Bill. So for my noble friend to put forward any argument that I ought to take some comfort, or ought not to press this amendment, because I had been forced to introduce rate capping seems to me, with the greatest respect to him, to be standing logic on its head.
I have listened to him with great care. I have to say that I am not yet persuaded that it would be wrong to wait and see what would be the effect on the expenditure plans when the districts realise that they have a direct interest in what is spent. There is no government shield between them and the PTA precept. They will have to add that precept, enlarged as it would be if those expenditure plans matured, to their own community charge.
That was always the logic of the case which was argued at length by Ministers in both Houses when the 1985 Act was going through Parliament. I am bound to say that I remain of the view that it would be right for the Government to give it a try. If their fears are justified, they can take the necessary action. If they feel that 1992 is too long to wait, there is a Third Reading. They could insert an earlier date if they wished.
I believe they would be right to wait before the advantages of the area-wide precept are inevitably sacrificed in the interests of closer direct accountability of an individual district councillor to his electors. So far, apart from the Minister, in both of the stages of this Bill where this has been argued there has not been a single voice opposed to the proposal that we should keep the precepting for the time being. In these circumstances I think it is right to test the opinion of the House.
10.55 p.m.
On Question, Whether the said amendment (No. 136) shall be agreed to?
Their Lordships divided: Contents, 7; Not-Contents, 23.

DIVISION NO. 6

CONTENTS

Dean of Beswick, L.

Teviot, L. [Teller.]

Jenkin of Roding, L. [Teller.]

Teviot, L.

McIntosh of Haringey, L.

Underhill, L.

Ponsonby of Shulbrede, L.

1815

NOT-CONTENTS

Arran, E.

Ferrers, E.

Beaverbrook, L.

Hesketh, L.

Belstead, L.

Hooper, B.

Blatch, B.

Mackay of Clashfern, L.

Brabazon of Tara, L.

Skelmersdale, L.

Caithness, E.

Swinfen, L.

Cameron of Lochbroom, L.

Thomas of Gwydir, L.

Cork and Orrery, E.

Trafford, L.

Davidson, V. [Teller.]

Trumpington, B.

Denham, L. [Teller.]

Ullswater, V.

Dundee, E.

Vaux of Harrowden, L.

Fairfax of Cameron, L.

Resolved in the negative, and amendment disagreed to accordingly.
11.3 p.m.
The Earl of Caithness The Earl of Caithness moved Amendments 137 to 151:
Page 21, line 5, leave out subsection (3) and insert—
("(3) Any amount set in substitution under subsection (1) above must be set in accordance with sections 30 and 31 above, but applying the following rules—

(a) section 30(2) shall be ignored for this purpose;

(b) the amount must be set by reference to the precept whose issue gives rise to the amount being set;

(c) the amount must be set by reference to any other precept issued to the authority for the year since the time when it set (or last set) an amount or amounts for the year under section 30 or 32 above or under subsection (6) below;

(d) the amount must he set by reference to any amount calculated by the authority in relation to the year under section 109(4) below since the time mentioned in paragraph (c) above;

(e) subject to paragraphs (b) and (d) above, the amount must be set by reference to the information in the authority's possession at the time mentioned in paragraph (c) above.").

Page 21, line 9, leave out from ("year") to ("and") in line 10 and insert ("under section 30 or 32 above or under this section").
Page 21, line 15, leave out subsection (5) and insert—
("(5) Any amount set in substitution under subsection (4) above must be set in accordance with sections 30 and 31 above, but applying the following rules—

(a) section 30(2) shall be ignored for this purpose;

(b) the amount must be set by reference to the amount calculated by the authority in relation to the year under section 109(4) below in making the calculations giving rise to the amount being set;

(c) the amount must be set by reference to any precept issued to the authority for the year since the time when it set (or last set) an amount or amounts for the year under section 30 or 32 above or under subsection (6) below;

(d) subject to paragraphs (b) and (c) above, the amount must be set by reference to the information in the authority's possession at the time mentioned in paragraph (c) above.").

Page 21, line 19, leave out from ("year") to ("and") in line 20 and insert ("under section 30 or 32 above or under this section").
Page 21, line 27, at end insert—
("(8) In construing subsections (3)(c) and (5)(c) above any precept for which another has been substituted shall be ignored; and in construing subsection (3)(d) above any calculation for which another has been substituted shall be ignored.").
Clause 35, page 22, line 14, leave out ("(5)") and insert ("(5A)").
Page 22, line 15, leave out from ("under") to ("a") in line 16 and insert ("section 30 above").
Page 22, line 19, after first ("authority") insert (", in setting an amount or amounts for the financial year under section 30 above").
Page 22, line 22, at end insert—
("(3A) If the charging authority sets an amount or amounts in substitution for the year under section 32 or 33 above at a time when a precept for the year has not been issued to it by the precepting authority, and an amount was included under subsection (3)
1816
above, the charging authority shall include among the items listed in section 30(4) above an amount equal to that included under subsection (3) above; and in such a case section 30(4) shall be read accordingly.").
Page 22, line 23, leave out from ("If") to ("for") in line 25 and insert ("the precepting authority issues to the charging authority a precept").
Page 22, line 39, at end insert—
("(5A) If the charging authority sets an amount or amounts in substitution for the year under section 32 or 33 above at a time when a precept for the year has been issued to it by the precepting authority, sections 30(4) and 33(3) and (5) above shall be read in accordance with subsection (4) above.").
Page 22, line 45, after ("authority") insert (", and in such a case section 30(4) shall be read accordingly.").
Page 22, line 46, leave out subsections (7) and (8).
After Clause 35, insert the following new clause:
("Anticipated precepts supplementary.
(1) References in this section to the charging authority, the precepting authority and the financial year are to the charging authority, the precepting authority and the financial year mentioned in section 35(2) to (5A) above.
(2) Where the charging authority includes under section 35(3) or (3A) above an amount equal to that payable under a precept, section 31 above shall have effect as if among the items listed in subsection (3) there were included an amount equal to that payable under the precept, in a case where the precept is stated to be applicable to a part of the authority's area.
(3) Where the charging authority includes under section 35(3) or (3A) above an amount equal to its estimate of the amount of any precept it expects to be issued, in a case where it expects the precept will relate to a part only of its area section 31 above shall have effect as if—

(a) the reference in subsection (2) to an item relating to a part included a reference to an item the authority expects will relate to a part, and

(b) among the items listed in subsection (3) there were included an amount equal to the authority's estimate of the amount of the precept it expects will be issued to it in relation to a part.

(4) If the charging authority sets an amount or amounts in substitution for the year under section 32 or 33 above at a time when a precept for the year has been issued to it by the precepting authority, sections 31 and 33(3) and (5) above shall be read in accordance with section 35(4) above.").
Clause 36, page 23, line 11, leave out from ("amounts") to ("shall") in line 13 and insert ("under section 30, 32 or 33 above").
The noble Earl said: My Lords, I beg to move Amendments Nos. 137 to 151 en bloc.
On Question, amendments agreed to.
Clause 37 [Standard community charge multipliers]:
[Amendment No. 152 not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 153:
Page 23, line 43, at end insert—
("(11) A class may be specified by reference to such factors as the Secretary of State sees fit.
(12) Without prejudice to the generality of subsection (11) above, a class may be specified by reference to one or more of the following factors—

(a) the physical characteristics of properties;

(b) the fact that properties are unoccupied or are occupied for prescribed purposes or by persons of prescribed descriptions;

(c) the circumstances of persons subject to standard community charges.").

The noble Earl said: My Lords, the amendment makes it absolutely clear that classes of property may be specified by reference not only to the physical characteristics of property but also by reference to such factors as the property being unoccupied or

1817
owned or rented by people in particular circumstances, such as old people who have moved into homes. We shall use these powers to ensure that property empty for up to three months pays no charge and, subject to consultation, that there is also no charge for homes left vacant by people who go into homes or hostels. I believe that this government amendment meets the concerns expressed by the noble Lord, Lord McIntosh of Haringey, in Amendment No. 152. I beg to move.
Lord McIntosh of Haringey: My Lords, I am grateful for the noble Earl's statement, which I can confirm meets my point in Amendment No. 152, and confirms my wisdom in not moving it.
The Earl of Caithness: My Lords, I am grateful to the noble Lord. That must be thank-you No. 25.
On Question, amendment agreed to.
Lord Hesketh: My Lords, I beg to move that further consideration on Report be now adjourned.
Moved accordingly, and, on Question, Motion agreed to.

London Local Authorities Bill [H.L.]
Reported from the Unopposed Bill Committee with amendments.

Eastbourne Harbour Bill [H.L.]
Returned from the Commons agreed to.
House adjourned at five minutes past eleven o'clock.

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  INCOME TAX LIABILITIES
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  FRAUD AND CORRUPTION CASES
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  NUCLEAR TESTING: JOINT VERIFICATION EXPERIMENT
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  US NUCLEAR WEAPONS IN UK
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  LOCAL AUTHORITY PUBLICITY: CODE OF PRACTICE
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  COMMUNITY CHARGE: AMENDMENTS
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