Sitting of 19 May 1988

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

Royal Assent
Mr. Speaker: I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified Her Royal Assent to the following Acts:

1. Licensing Act 1988.

2. Matrimonial Proceedings (Transfers) Act 1988.

3. Felixstowe Dock and Railway Act 1988.

Royal Assent
  PRIVATE BUSINESS

    LONDON REGIONAL TRANSPORT BILL (By Order)
    Order read for resuming adjourned debate on Question [10 December], That the Bill he now considered.
    Debate further adjourned till Thursday 26 May.
    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)

    NORTH KILLINGHOLME CARGO TERMINAL BILL (By Order)
    Orders for Second Reading read.
    To be read a Second time upon Thursday 26 May.

    ST. GEORGE'S HILL, WEYBRIDGE, ESTATE BILL (By Order)
    Read a Second time and referred to the Examiners of Petitions for Private Bills.

    NEWCASTLE UPON TYNE TOWN MOOR BILL [Lords] (By Order)
    Order for Second Reading read.
    To be read a Second time upon Thursday 26 May.

    ASSOCIATED BRITISH PORTS (No. 2) BILL (By Order)
    Order read for resuming adjourned debate on Question [11 May], That the Bill be now read a Second time.
    Debate further adjourned till Thursday 26 May

Oral Answers to Questions
  HOME DEPARTMENT

    Nationality Applications
    Mr. Hanley: To ask the Secretary of State for the Home Department what progress has now been made on clearing the backlog of nationality applications at Lunar house; and if he will make a statement.
    Mr. Turner: To ask the Secretary of State for the Home Department if he will make a statement on the present backlog of applications for British nationality.
    The Minister of State, Home Office (Mr. Tim Renton): Good progress is being made. All applications received before 31 December have been acknowledged and passports and other documents returned to applicants.
    We still face a formidable task in dealing with some 268,000 outstanding citizenship applications. They include over 80,000 naturalisation applications and 187,000 for registration as British citizens. To deal with the latter we have decided to establish a new nationality office in Liverpool, where we will create over 100 new jobs. Suitable accommodation has been identified and negotiations for its lease are in hand.
    It will not be practicable to reach decisions on all the registration applications by the end of the year, as the Select Committee on Home Affairs has recommended, but I am confident that a substantial proportion will be decided by April 1989 and the remainder during the following 12 months.
    Mr. Hanley: I congratulate my hon. Friend on the progress that has been made and the staff at Lunar house on meeting their immense task. Does my hon. Friend agree that the heavy work load at Lunar house was the result of more than 250,000 people leaving it until the last minute, having been given seven years within which they could have applied? Does my hon. Friend also agree that publicity should be given earlier to help not only the staff at Lunar house but those who have made applications? Would it not be sensible to do that with passports, where early application is always sensible?
    Mr. Renton: I thank my hon. Friend for his kind remarks. I shall pass his congratulations on to the staff and management at Lunar house, who have worked hard to deal with the great mountain of work that arrived, particularly in the last weeks of December.
    Active publicity to remind people that registration for citizenship applications had to be in by the end of last year started fairly early in 1987. I was pressed to increase the advertising and the number of leaflets to ensure that everyone knew, and that was done. Such was the success of the advertising campaign that we received a great many nationalisation applications—more than usual—even though there was no deadline.
    Mr. Turner: Will the Minister show some humility, in view of the answer that he has just given, to the plight of those 280,000 people who are suffering indignity, frustration and anxiety as a result of the Government's incompetence? Irrespective of his announcement about the

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    100 new jobs, when will he reach out to those who at present believe themselves to be stateless, respond to their requirements and do the necessary and honourable thing?
    Mr. Renton: As the House will know, I am a naturally humble person. However, most of the people who applied—100,000 in December alone—had waited five years before the deadline was announced before submitting their applications. They were in no hurry to apply. The hon. Gentleman must realise that application for British citizenship is important and should not be decided in a great hurry. In the intervening period, while their applications are being processed, we have told them many times that they will lose nothing by way of social security, pension, housing benefits or voting rights, so they have nothing to worry about. Perhaps the hon. Gentleman will pass that message on to his constituents.
    Mr. Budgen: Does my hon. Friend realise that those hon. Members who represent constituencies which contain many immigrants could have told him that there would be a flood of applications? We recognise that those applications should be dealt with properly, if necessary, by employing a large number of temporary assistants.
    Mr. Renton: My hon. Friend's expertise on this matter is very different from that of officials in the immigration and nationality department at Lunar house. They took advice from a number of people in 1986 and were advised that most of the people who wanted British citizenship under the registration procedures had already applied in previous years.
    The Department has increased its administrative divisions by 300 posts in the past three years. One hundred and eighty clerical staff were recruited last year, and over 300 applications for clerical posts are being processed at present. I assure my hon. Friend that we are making every effort to increase the staff complement.
    Mr. Madden: Why did the Minister reject the urgent advice given to him by senior members of his own staff last summer that the arrangements for dealing with the inevitable number of applications were wholly insufficient? He is also the victim of justified criticism from the Select Committee on Home Affairs which roundly criticised him for presiding over an administrative shambles when the Government had several years to plan for this. The hon. Gentleman should have appointed the necessary staff to deal with the applications. He has failed and he should resign.
    Mr. Renton: The hon. Gentleman has again made his Second Reading speech on the Immigration Bill. There is no record of the trade union side at Lunar house having given officials and management such advice. When I met trade union officials at Lunar house in early February, they did not wish to recommend the staff at Lunar house even to do overtime. The management had to work extremely hard to persuade the staff to do overtime.
    Mr. Churchill: Is it not clear that, if present trends continue, accommodation will have to be found in this country over the next 10 years for about 500,000 new immigrants? What provision are the Government making in their costings for assisting those areas of the country, to which the immigrants are likely to come, to provide additional housing, schools and hospitals?
    Mr. Renton: As my hon. Friend will realise, that is a matter not so much for the Home Office as for the Department of the Environment. However, we are actively engaged in a number of initiatives—for example, an inner cities initiative to help those who have recently arrived in this country to become involved in their own small businesses. Last year the number arriving here for permanent settlement was 45,000—the lowest for many years and only about half of what it was in the 1970s.
    Mr. Randall: Is the Minister aware that 60 per cent. of telephone calls coming into Lunar house are wholly ignored, not even being received on a telephone answering machine? How does he justify that policy?
    Mr. Renton: The hon. Gentleman's remarks are out of date. The telephone inquiry bureau has shown a marked improvement in recent weeks, and an improvement was certainly needed.
    Mr. Randall: Since I have been there.
    Mr. Renton: A few weeks ago the hon. Gentleman and the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) visited Lunar house, and they spent the greater part of their time, according to the Observer, looking for a photo opportunity in front of the mail bags. That may have been of great help to becoming a political tennis star, but it did nothing to help the problems of Lunar house.
    Several Hon. Members rose—
    Mr. Speaker: Order. This is an important matter, but I hope that we can now proceed more rapidly.

    IBA and BBC (Chairmen)
    Mr. Gerald Howarth: To ask the Secretary of State for the Home Department when he last met the chairman of the Independent Broadcasting Authority and the chairman of the British Broadcasting Corporation; and what matters were discussed.
    The Secretary of State for the Home Department (Mr. Douglas Hurd): I am in regular touch with both chairmen on a wide range of broadcasting matters.
    Mr. Howarth: Next time my right hon. Friend meets the two gentlemen concerned, will he remind them that those who broadcast to the nation are part of the nation, not an elitist super race apart? Will he further remind them that it is they who act as censors and that the new Broadcasting Standards Council will serve as a vital test of accountability towards the viewer, which is badly needed? Does my right hon. Friend consider that one best suited to serve that accountability purpose may be Mrs. Mary Whitehouse?
    Mr. Hurd: Mrs. Whitehouse's role in this matter has been well recognised. The truth is that it has been difficult to portray Sir William Rees-Mogg convincingly either as a gauleiter or as a vandal. I hope that as the waves subside on this matter he can get on with the broadcasting authorities and work out how the new council will operate in practice. We can judge a little later what the statutory definition and power should be.
    Several Hon. Members rose—
    Mr. Speaker: Order. I remind hon. Members that there is a further question about the Broadcasting Standards Council.
    Mr. Menzies Campbell: When the Secretary of State next meets the chairmen of the IBA and BBC, will he congratulate them on the continuing high standard of broadcasting in the United Kingdom and assure them of his support to ensure that their independence is not compromised?
    Mr. Hurd: Indeed, Sir. When we publish a White Paper on television, which will probably not be until the autumn, the hon. and learned Gentleman will see the huge change that will come over television in the form of greatly expanded choice for viewers, going well beyond the present scope of the BBC and IBA. We must deregulate to make that wider choice available, while keeping a grip on standards.
    Mr. Stanbrook: In the light of the decision by the two authorities to allow a television broadcast giving a one-sided account of the Gibraltar incident, is my right hon. Friend satisfied that those two authorities serve the public interest? Should there not be a review of who is to determine public interest, rather than leave it to a group of nominated people and programme makers who are not elected to that capacity?
    Mr. Hurd: My right hon. and learned Friend the Foreign Secretary made it clear to both chairmen, in his letters about showing the programmes on Gibraltar, that he was appealing to them on grounds of responsibility rather than law. My view is that it is for the broadcasting authorities to discharge their duties in this area and that they are helped rather than hindered by a robust give-and-take between broadcasters and politicians.
    Mr. Winnick: Leaving aside the obvious and continuous vendetta by many Tories against the broadcasting authorities, in his talks with the chairmen of those authorities did the Home Secretary mention that he would make it far more difficult for retired people to get a concessionary television licence? Does the Secretary of State realise that his statement in his written answer that appears in yesterday's Hansard will be greeted with disgust by many retired people who will now find it more difficult to obtain a concessionary television licence fee? Why should not all pensioners be able to claim a concessionary television licence fee on the lines that I proposed in my Bill that was defeated?
    Mr. Hurd: If we did what the hon. Gentleman suggests, the cost to other licence holders, many of whom are worse off than pensioners, would he substantial. The hon. Gentleman has not thought the matter through. We had to deal with the unsatisfactory 5p concessionary licence. We could not abolish it without substantial grievance and hardship. The solution that I outlined yesterday is sensible and fair in the circumstances.

    Terrorism
    Mr. McLoughlin: To ask the Secretary of State for the Home Department what further measures he is taking to co-ordinate action against terrorism, in the light of recent events.
    Mr. Hurd: The Government have taken and will continue to take a leading role in international co-operation to prevent and fight terrorism. I shall be meeting Interior and Justice Ministers of the Trevi Group on 3 June at Munich and we shall take stock of a number of recent improvements in European co-operation in this area and, I dare say, discuss further proposals. Within the United Kingdom I believe that there is effective co-operation between the police and other agencies concerned.
    Mr. McLoughlin: Does my right hon. Friend agree that the Prevention of Terrorism (Temporary Provisions) Act 1984 is important? Is it not a great shame, bearing in mind the important fight against terrorism, that the official Opposition refused to support the Act although they supported it when they were in office? They have opposed it only since they have become the Opposition.
    Mr. Hurd: The Opposition not only supported the Prevention of Terrorism (Temporary Provisions) Act 1984; they invented it. We will have to produce and put before the House a new Prevention of Terrorism Bill because the old one is coming towards the end of its five-year life. That will give the Opposition a chance to reflect and take stock. Reinforcing my hon. Friend's comments, it would considerably strengthen the nation's efforts against terrorism if Opposition Members could bring themselves to change their position yet again and support a robust measure.
    Mr. McCusker: Does the Secretary of State agree that sentencing policy should play a major part in the fight against terrorism? In the Secretary of State's view, what conditions should a convicted terrorist have to meet to qualify for remission of sentence?
    Mr. Hurd: That depends on the offence for which the terrorist was convicted. If the hon. Gentleman wants to draw specific cases or instances to my attention or to that of my right hon. Friend the Secretary of State for Northern Ireland, I hope that he will do so.
    Mr. Burt: As regards international terrorism, will my right hon. Friend assure the House that he and his international colleagues will bend their minds to the difficult question of press and television coverage of incidents like the recent hijacking? Does he agree that the considerable publicity given to hijackers' demands can sometimes contribute to the problems of terrorism? Will he consider the difficult area of censorship associated with that problem?
    Mr. Hurd: I agree that it is a difficult and sensitive area. It is a matter not so much of censorship as of responsibility. Obviously the broadcasting media in any free society need to report the news with some calculation of the consequences of their actions in what they do and do not show. That matter needs consideration.
    Mr. Cryer: Does the Home Secretary accept that pressure from the Common Market will mean the removal of all internal barriers by 1992? Is he satisfied that adequate precautions will be taken to scrutinise people to detect terrorists and the movement of drugs after 1992? Does he further accept that while he may have reservations about this, many member states want the complete removal of barriers, whatever the consequences for the increase of international drug trafficking and terrorism?
    Mr. Hurd: The hon. Gentleman has made a very important point. Fortunately, we are not alone in stressing its importance. The Single European Act, from which the movement towards 1992 flowed, made it clear that member states must be free to continue to take effective measures against terrorists and drug traffickers. In all our detailed discussions on the movement towards 1992—for example, regarding the Channel tunnel—it will be important to maintain effective controls for those purposes.
    Mr. Marlow: What is the media's role in the fight against terrorism? It would seem that they compete with each other in providing entertainment for the public rather than an objective review of the facts. What can be done to prevent the media from providing gratuitous support for acts of terrorism?
    Mr. Hurd: The media need to consider carefully, whether in Northern Ireland or elsewhere, the distinction between reporting the news—letting the citizen know what is happening, without disguising the fact that we live in a brutal and violent world—and adding gratuitously to scenes of violence, thus providing, according to Lord Annan's description when he discussed this matter, additional publicity which serves the terrorist without actually adding in any way to the information of the citizen.

    Broadcasting Standards Council
    Mr. Morley: To ask the Secretary of State for the Home Department if he has yet decided on the terms of reference for the Broadcasting Standards Council.
    Mr. Renton: My right hon. Friend the Secretary of State set out the terms of reference for the Broadcasting Standards Council in his statement to the House on 16 May.
    Mr. Morley: Is the Minister aware that on 16 May the Secretary of State failed to give an assurance to my right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) that the Broadcasting Standards Council would not interfere with the political and current affairs contents of programmes and would restrict itself to standards of decency? Is he further aware that there is a great deal of anxiety that the council will duplicate what already exists simply so that the Government can manipulate it? The Government already have the press in their pocket. Can the Minister give the House a categorical assurance that the broadcasting authorities will be free to comment as they see fit?
    Mr. Renton: Of course broadcasting authorities will be free to comment as they see fit. They have already commented and made known their views on the setting up of the Broadcasting Standards Council. Doubtless it is right that they should have that democratic right, and that will continue.
    On his first point, the hon. Gentleman is wrong. When my right hon. Friend announced the setting up of the council, he described its remit and said that it was strictly confined to questions of sex, violence and standards of taste and decency. When asked whether it would be possible for those powers to be added to or diminished, he made the point that the council's role will be debated in the House—for example, in the course of future legislation. I
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    have no doubt that at that time hon. Members on both sides of the House will seek to add to or diminish its powers.
    Mr. Lawrence: Is my hon. Friend aware that many parents in Britain are angry about the steady diet of pornography, near-pornography and violence that is fed to their children on practically a nightly basis and fed up with the whining and whingeing of the broadcasting authorities which have been given plenty of opportunities to put their house in order, but have deliberately refused to do so?
    Mr. Renton: I agree with my hon. the learned Friend. It was because of that anxiety that, in our election manifesto a year ago, we committed ourselves to bringing forward proposals for stronger and more effective arrangements. That is what we are now doing. I hope that the Broadcasting Standards Council will prove the cure to the disease. If so, its setting up will prove a worthwhile exercise.
    Mr. Tony Banks: I am sure that the Prime Minister wants to make the BBC as fair and impartial as The Sun and the Daily Mail. How long will the Broadcasting Standards Council exist on a non-statutory basis, and how much will Sir William Rees-Mogg be paid as chairman of that censorship body?
    Mr. Renton: The hon. Gentleman is wrong to refer to the council as a censorship body. Its purpose to reflect the views of and receive complaints from the public on programme content and decency. I am sure that the hon. Gentleman has constituents, as I have, who will be pleased that an outside body is now looking at such complaints.
    Sir William Rees-Mogg will receive a salary at the outset of £30,000 a year. We are setting up the council on a non-statutory basis so that it can get on with its work straight away. If legislation is needed to reinforce its work, that will be incorporated in the major broadcasting Bill that we shall bring before Parliament in due course.

    Electronic Tagging
    Mrs. Virginia Bottomley: To ask the Secretary of State for the Home Department what representations he has received on proposals to use electronic tagging for remand prisoners.
    The Minister of State, Home Office (Mr. John Patten): We have received correspondence from interested bodies suggesting various uses for electronic tagging, including its use for people remanded on bail. We are making inquiries into the systems which are available and considering what applications they might usefully have.
    Mrs. Bottomley: I thank my hon. Friend for his open-minded response. Does he agree that when one fifth of the prison population are on remand, and when two thirds of the women and one third of the men on remand do not subsequently receive custodial sentences, in the interests of civil liberty, cost saving and public confidence it is right that the tagging option should be explored? Will he join me in condemning the knee-jerk reaction of the Labour party, which is only too anxious to complain about the size of the remand population, but which looks with a closed mind at any prospect of tackling it?
    Mr. Patten: I agree with my hon. Friend that the Opposition do not have an idea between them about dealing with the remand problem. Electronic tagging, subject to many safeguards, may be extremely useful in enabling people to be kept on remand outside the prison system. I am sure that that would be welcomed by all Members.
    Mr. Alex Carlile: Does the Minister agree that some courts may be less willing than others to have people tagged by the attachment of an object, either voluntarily or compulsorily, to their arms or legs? Will the Home Office consider alternatives, including the provision of the equivalent of a paging device in the accused's home, which would allow the police to make spot checks on a remanded person's whereabouts?
    Mr. Patten: The hon. and learned Gentleman, unlike many of the hon. Gentlemen surrounding him, is extremely open-minded and is at least prepared to examine proposals aimed at achieving a reduction in the prison population. He may agree with me that asking people to carry an electronic tag or a paging device would be less of an intrusion into civil liberties than putting them in gaol.
    Mr Wheeler: Does my hon. Friend agree that technological developments now make it possible for a variety of strategies to be considered under the general umbrella of tagging? Does he agree also that, as this debate continues, even probation officers are beginning to recognise the advantage of keeping people out of prison, and perhaps some people out of remand centres, by the adoption of such technology?
    Mr. Patten: The technologies are developing rapidly and I agree with my hon. Friend that the probation service now has a golden opportunity to move centre stage in dealing with remand prisoners and with others who might otherwise be sent to gaol for committing non-violent, non-serious crimes.

    Remand Centre (North Wales)
    Mr. Ieuan Wyn Jones: To ask the Secretary of State for the Home Department what plans his Department has to establish a remand centre in north Wales.
    The Parliamentary Under-Secretary of State for the Home Department (Mr. Douglas Hogg): None at present. Last month the Prisons Building Board invited the private sector to submit outline proposals for the construction of urban remand centres. The responses are still being evaluated, but any new remand centres are likely to be sited in the main conurbations.
    Mr. Jones: Is the Minister aware that the majority of remand prisoners in north Wales are held at Risley remand centre, which is a considerable distance from that region's rural areas? There is also concern about the conditions at Risley. Is the Minister not worried about the terrible inconvenience caused to the families of remand prisoners in having to travel the distances involved, as well as that caused to their solicitors and to the prisoners themselves? Will he review his decision and consider providing remand facilities in north Wales?
    Mr. Hogg: There is a place in the building programme for a prison at Wrexham. Unfortunately, that proposal
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    has not been received with complete enthusiasm by the local representatives. I hope that the point made by the hon. Gentleman will be considered by local residents.

    Criminal Cases (Right to Silence)
    Mr. Flynn: To ask the Secretary of State for the Home Department if he has any plans to seek to alter the present right to silence of suspects and defendants in criminal cases.
    Mr. John Patten: I refer the hon. Member to the reply given to my hon. Friend the Member for Lancashire, West (Mr. Hind) yesterday.
    Mr. Flynn: Does the Minister agree that, while the mass of police interrogations are carried out in an exemplary manner, there have been worrying cases of alleged confessions that have afterwards been found to he false? This can be seen in the conclusions of the Mars-Jones inquiry. Examples are the Timothy Evans case and the Confait case, in which several youths, one mentally retarded, were alleged to have made confessions which were afterwards found to be false. Does the Minister not consider that any decision on ending the right to silence is premature, and that in attempting to create a law to deal with hardened criminals he is putting at grave peril the interests of the weak, the inadequate and the innocent?
    Mr. Patten: The weak, the inadequate and the innocent are well covered by the codes of practice in the Police and Criminal Evidence Act 1984. The hon. Gentleman is right. This is a complex subject, and that is why my right hon. Friend the Home Secretary announced an inquiry yesterday.
    Mr. Hind: I am very grateful to my right hon. Friend the Home Secretary for the comprehensive answer that he gave to my written question yesterday. When my hon. Friend assesses this problem, will he look very carefully at the Criminal Law Revision Committee report of 1972, bearing in mind that when the right to silence was introduced there were no solicitors in police stations or at interviews, or any tape recordings? We must keep pace with the new advances in technology and the changes in the laws of evidence.
    Mr. Patten: My hon. Friend is right. Since the CLRC reported in 1972 many changes have taken place, both in legislation, such as the Police and Criminal Evidence Act, and in technology, such as the universal introduction of tape recording in police stations, which we hope to have in place by 1991. These are complex issues, however, and that is why my right hon. Friend said in answer to my hon. Friend's question yesterday that he would look into the matter as soon as possible.
    Mrs. Taylor: Does the Minister not realise that there is widespread concern about the proposed erosion of the principle that someone is innocent until proved guilty? Why is the Home Secretary going ahead with the abolition of the right to silence before the results of the Government-funded research are published? Is it not irresponsible to make such a fundamental change to our criminal procedures without first obtaining all the evidence that is available? If the Government are willing to spend money on research, why are they not willing to wait until the findings of that research are forthcoming?
    Mr. Patten: The hon. Lady is a little confused about the issues. My right hon. and learned Friend is not proposing to abolish the right to silence. He is proposing to set up a committee to look into the possibilities of abolishing the "right to ambush", by which I mean a defendant introducing into a trial at the last minute a line of defence that has not been previously disclosed. This often means that a prosecution case collapses, and sometimes people with a case to answer go free.

    Remand System
    Mr. Sackville: To ask the Secretary of State for the Home Department when he expects to publish his Green Paper on plans to introduce the private sector into the remand system.
    Mr. Hurd: Before the summer recess. We are also moving forward with the selection and appointment of management consultants to help in examining the practical issues.
    Mr. Sackville: Does my right hon. Friend agree that because of overcrowding, drug abuse and other serious problems affecting our prisons it is unwise and inappropriate to expose unconvicted men and women to such a system? We have a lot to learn from certain American states about the treatment of remand prisoners.
    Mr. Hurd: I think that my hon. Friend is probably right. I believe that the new bail hostels that I have announced will help, but I hope that we can bring the private sector into the business of not only constructing, but possibly managing, remand centres. We have asked the private sector for ideas on design and on quick methods of constructing open prisons and remand centres. We have had 30 responses, which I find encouraging. The Prisons Building Board will go through the responses and work out the proposals in greater detail.
    Mr. Ashby: Will my right hon. Friend consider very carefully the close involvement of the private sector in the design and building of special remand centres? Will he also consider the smaller, localised remand centre, perhaps attached to or close to a court, or group of courts, so that there can be speedy access to people in custody and they can be remanded without the problem of having to go to distant police stations or prisons?
    Mr. Hurd: The answer to my hon. Friend's first question is yes. His second suggestion is well worth considering in the Green Paper that we are preparing.

    Police Officers (Prosecutions)
    Mr. Wray: To ask the Secretary of State for the Home Department how many members of police forces have, for each year since 1974, been (a) tried and (b) convicted for conspiring to pervert the cause of justice.
    Mr. Douglas Hogg: The available information about criminal charges brought against police officers does not identify separately charges of conspiracy to pervert the course of justice, and I regret that the information requested could be obtained only at disproportionate cost.
    Mr. Wray: Does the Minister agree that there has been much anxiety about a number of cases over the years, culminating in two recent cases, the Chelsea gang case, and
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    the Stirton case, where the dubious fabricated evidence has cost the taxpayer money? Will the Home Secretary review the present arrangements, by bringing out a Green Paper?
    Mr. Hogg: There is absolutely no need.
    Mr. Nicholas Bennett: Does my hon. Friend agree that the very small proportion of police officers who attempt to pervert the course of justice is symptomatic of what a good police force we have? Does he agree also that it compares favourably with police forces abroad, and that we should be concerned about the number of police officers who are injured?
    Mr. Hogg: Absolutely.
    Mr. Campbell-Savours: Why is the Police Federation so reluctant to give legal support to Inspector Woollard? Does the federation believe that if he were to go to court some police officers would be prosecuted for offences?
    Mr. Hogg: I should be inclined to ask the chairman of the Police Federation.

    Double Parking Offences
    Mr. Harry Greenway: To ask the Secretary of State for the Home Department how many vehicle owners have been convicted of double parking in London in the past 12 months; and if he will make a statement.
    Mr. Douglas Hogg: Drivers who double park may be charged with the offences of breaching waiting restrictions, unnecessary obstruction or leaving a vehicle in a dangerous position. In the Metropolitan and City police force areas there were over 11,500 convictions for these offences and nearly 2·7 million fixed penalty notices were issued. These offences may also be committed by persons who have not double parked, and I regret that it is not possible to identify double parking cases within these total figures.
    Mr. Greenway: Is my hon. Friend aware of the serious shortage of parking spaces in London and the increase in double parking for that reason? What view does he take of parking tickets being issued at 4 am and 5 am when people have double parked for short periods because no other parking is available? Will he take steps to see that more parking is made available, so that double parking may cease?
    Mr. Hogg: I suspect that the case to which my hon. Friend is referring reinforces his belief that it is best to travel to work on a horse.

    Firearms
    Mr. Boswell: To ask the Secretary of State for the Home Department if he will make it his policy to break down future statistics for the use of firearms in the commission of crimes between those that are, or are not, held on firearm or shotgun certificates.
    Mr. Douglas Hogg: It is not practicable, because many firearms used in offences are either not recovered or have had their serial numbers or distinguishing marks removed. There is no way of telling, therefore, whether they were originally held on a firearm or on a shotgun certificate.
    Mr. Boswell: Given the considerable burdens that the new legislation will impose on legitimate shooters, will my hon. Friend reconsider whether he could publish as much as possible about the difference between guns which are held legally and those which are not known to be held legally, and whether he can measure as far as possible the leakage of legitimate guns, badly stored, into the illegitimate sector?
    Mr. Hogg: My hon. Friend will find two provisions in the Bill which will reassure him: first, the requirement for shotgun owners to identify and list their guns; and, secondly, the additional obligation on dealers to keep their registers for five years.

    Official Secrets Act
    Mr. Caborn: To ask the Secretary of State for the Home Department when he expects to make a statement on his proposals for the reform of the Official Secrets Acts.
    Mr. Hurd: I hope, as already stated, to lay before Parliament next month a White Paper setting out the Government's proposals for the reform of section 2 of the Official Secrets Act 1911.
    Mr. Caborn: Can the Home Secretary give precise details of the timetable? Reform has been promised for eight or nine years. He was party to the punishing of his own Back Benchers some weeks ago, and precisely laid out on BBC radio some days after that what the White Paper would contain. Can he set out a timetable for the Bill after the White Paper and what consultations are likely?
    Mr. Hurd: The hon. Gentleman has got the history wrong. We restarted work on this in April of last year. I said, I think for the first time in December last year when my hon. Friend's Bill was debated, that we intended to lay before Parliament next month a White Paper. That is still our intention.

    Law and Order Budget
    Mr. Sumberg: To ask the Secretary of State for the Home Department what is the law and order budget within his Department for 1988–89; what was the comparable budget for the last 10 years; and what proportion of the budget is devoted to police manpower costs.
    Mr. Hurd: The Home Office law and order budget for 1988–89 is £5,098 million, of which 61 per cent, is devoted to police manpower costs. I will, with permission, circulate in the Official Report the figures for the Home Office law and order budget for previous years.
    Mr. Sumberg: Are not those figures proof-positive of the Government's commitment to the police force? Will my right hon. Friend join me in condemning those Left-wing Labour councils throughout the country which knock the police constantly, spend ratepayers' resources on that and thus destroy the safety of law-abiding citizens whom they are supposed to represent?
    Mr. Hurd: My hon. Friend is perfectly right. There are still too many snipers of the police about, and unfortunately some of them are still on the Opposition Benches.
    The figures are as follows:
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    £ million

    1978–79

    1,556

    1979–80

    1,971

    1980–81

    2,412

    1981–82

    2,855

    1982–83

    3,166

    1983–84

    3,462

    1984–85

    3,921

    1985–86

    3,967

    1986–87

    4,308

    1987–88

    14,832

    1988–89

    5,098

    1 Estimated outturn.

    This is the gross expenditure in England and Wales on police, prisons, the magistrates' courts, the probation service and the criminal injuries compensation scheme.

  PRIME MINISTER

    Engagements
    Mr. Ray Powell: To ask the Prime Minister if she will list her official engagements for Thursday 19 May.
    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. Powell: Will the Prime Minister reflect on the reception that she received last Saturday at Hampden park? Does she now realise that some of her decisions are even worse than the referee's? Last Tuesday, when she replied to my hon. Friend the Member for Ealing, Southall (Mr. Bidwell), she stated that everyone in the country had enjoyed increased prosperity. Will she explain why, in 1979, my constituents in Ogmore were employed in the steel works and in the mines and were earning £150 to £240 a week, whereas many are now on the dole and have been unemployed for five years, as have 2 million others? How can she say that they are enjoying increased prosperity?
    The Prime Minister: The answers to the parts of the question that I was able to hear are, first, that I very much enjoyed the game at Hampden park and the visit to the flower festival in the morning, and we had an excellent conference the night before. Secondly, everyone has participated in the increased prosperity. Average earnings are very much up, taxation is very much down, personal allowances are very much increased, social security benefits have increased enormously and so have the health services.
    Mr. Stokes: Will my right hon. Friend consider whether any action can be taken against the BBC and ITV for their attitude towards the security forces in the fight against terrorism? Would any other country tolerate such behaviour, and is not their action a stab in the back for the nation?
    The Prime Minister: As my hon. Friend is very well aware, if there are any complaints they should be made, not to me, but to the BBC complaints authority or to the chairman.
    Mr. Kinnock: Is the Prime Minister satisfied with the effect on the pound/deutschmark rate of the interest rate—[Interruption.]
    Mr. Speaker: Order. It takes up a lot of time.
    Mr. Kinnock: Is the Prime Minister satisfied with the effect on the pound/deutschmark rate of the interest rate cut on Tuesday?
    The Prime Minister: I made a very comprehensive statement on Tuesday. If the right hon. Gentleman wants to know the unwisdom of asking direct questions about the exchange rate, he should see what happened when certain Labour Back Benchers, who later became Front Benchers, asked such questions of—as they are now—Lord Wilson and Lord Callaghan. It was absolutely catastrophic. I have nothing to add to the statement that I made on Tuesday.
    Mr. Kinnock: Now perhaps the Prime Minister will give us the answer. Is she satisfied that D 3·17 to the pound is sustainable, or unsustainable?
    The Prime Minister: I have nothing further to add. I commend to the right hon. Gentleman the references that I made. He will learn a great deal from them.
    Mr. William Powell: Now that we have seen yet another substantial fall in unemployment as a result of the Government's policies, will my right hon. Friend reflect on the fact that it was in March 1979 that the closure of Corby steel works was announced and 8,000 people lost their jobs in my constituency? Today, the number of people out of work and claiming benefit in Corby town has fallen below 2,000 for the first time.
    The Prime Minister: I agree with my hon. Friend. Corby is an excellent example of a town undergoing the necessary reconstruction of a major industry and having the enterprise to find new jobs for the people there, and a new prosperity. I congratulate my hon. Friend.
    Mr. Fisher: To ask the Prime Minister if she will list her official engagements for Thursday 19 May.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Fisher: In reply to my hon. Friend the Member for Ogmore (Mr. Powell) the Prime Minister referred to income tax being very much lower. How does she justify the fact that as a direct result of the tax loopholes and tax advantages that her Government have created, a 51-year-old man earning £1 million a year can apparently pay no income tax? How is that a fair tax system, and what will she do to close those loopholes?
    The Prime Minister: Under the new tax system those at the top of the scale pay a bigger proportion of the total amount than they did previously. I commend to the hon. Gentleman the speech of the New Zealand Socialist Minister for Finance, who has now made the top rate of tax 33p in the pound. One of the reasons for that is that he believes it is good for the people at the bottom of the pile to have a higher standard of living.

    New Zealand Butter
    Mr. Teddy Taylor: To ask the Prime Minister if the next meeting of the European Council will discuss the special arrangements for the import of New Zealand butter; and if she will make a statement.
    The Prime Minister: I am not aware of any plans to do so.
    Mr. Taylor: Will my right hon. Friend fight hard to prevent the EEC further cutting New Zealand butter imports and depriving British housewives of freedom of choice, particularly as New Zealand has never let Britain down when we have been in trouble? Will she bear in mind the massive damage being done to New Zealand, Australia and the Third world by the Common Market spending over £200 million of taxpayers' money every week dumping butter on the world market at 6p a pound?
    The Prime Minister: As my hon. Friend is aware, we have done more than any other Government to get the surpluses under control in the Common Market, in particular at the last meeting that we had, because we were very much aware of the truth of what my hon. Friend said. The surpluses affect other countries which depend to a considerable extent upon the export of agricultural products. The New Zealand butter agreement will come up again shortly for examination and we expect the Commission to make proposals. New Zealand exports far less butter to Britain than it used to do, but it is an important part of its economy and many people in this country wish to continue to be able to buy that butter, and I assume that they will be able to do so.
    Mr. Rees: Will the Prime Minister recall the speed with which the New Zealanders came to our support in 1939? Will she consider visiting the airfields in Lincolnshire and the war graves all the way from El Alamein to the Austrian border and reflect on the price that New Zealanders paid while supporting us, and support the New Zealanders in the EEC?
    The Prime Minister: I thought that I was doing just that in my reply, because butter exports are very much a part of the New Zealand economy. People here still wish to purchase that country's butter—and lamb—and I am very much aware that the import quotas have been reduced steadily from 165,000 tonnes in 1973 to 74,000 tonnes this year. A new agreement will be negotiated, which I hope will be satisfactory to all concerned.
    Dame Elaine Kellett-Bowman: Will my right hon. Friend reflect on the fact that, although many people agree that the older generations of New Zealanders, in the first and second world wars, supported us superbly, as they did in the Falklands, the present New Zealand Government, under Labour, have reneged on their duty to contribute to the defence of the free world and the position has radically changed?
    The Prime Minister: I am very much aware that our ships are not able to go to New Zealand at the moment—which I think is a great tragedy both for our Navy and for many people in New Zealand—because the New Zealand Government insists on the ships not having any nuclear weapons or on asking questions about that, and of course we cannot say whether they have because of our obligations to NATO. Nevertheless, I do not think that

    1095
    that would warrant taking it out of the New Zealand people by not doing everything that we can to see that they have a thoroughly satisfactory arrangement for the continued sale of butter to the Common Market.
    Mr. Wilson: Having used the un-word "unwisdom", and having called in aid the good example of the New Zealand Socialist Government, will the Prime Minister now give an assurance that there will be no cruise missiles on the Clyde?
    The Prime Minister: I shall give the hon. Gentleman the assurance that we shall take whatever measures are necessary to keep a continued effective nuclear deterrent and to carry out our obligations to NATO.
    Mr. Dykes: Will my right hon. Friend accept, though, that fairminded New Zealanders agree that the arrangement for New Zealand, which is very welcome in all parts of the House, has been a very good one for that country, but that that does not gainsay the need for New Zealand to find other markets, including the Soviet Union, because New Zealanders sell more butter there than the EEC does?
    The Prime Minister: Yes, but I hope my hon. Friend will appreciate that when they have a drop in quota from 165,000 tonnes in 1973 to 74,000 tonnes this year they have had to be very active in finding other markets, particularly those in the Pacific basin.

    Engagements
    Mr. Livingstone: To ask the Prime Minister if she will list her official engagements for Thursday 19 May.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Livingstone: In the Prime Minister's busy day, will she find time to consider the conviction for murder of Mr. Robert McConnell, a Unionist paramilitary, and investigate who authorised the decision of the RUC to destroy its case notes rather than bring prosecutions against two members of the SAS, Sergeant Aitken and Corporal McGow, who supplied the sub-machine gun used in the murder? Will she therefore report urgently to the House on who authorises SAS operations at political and operational levels at home and abroad?
    The Prime Minister: As the hon. Gentleman is aware, decisions about prosecutions are not for me. They are for the prosecuting authorities. If the hon. Gentleman has any evidence, I suggest that he puts it to those authorities, rather than give it under privilege. We do not discuss matters relating to the SAS, and no one would want us to do so unless he wished to undermine the security of this country.
    Mr. Couchman: To ask the Prime Minister if she will list her official engagements for Thursday 19 May.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Couchman: Does my right hon. Friend agree that today's most heartening unemployment and employment statistics underscore our burgeoning economy? Should we
    1096
    not now be placing the greatest emphasis on training our young people in the skills that will be needed in the 21st century, the shortage of which is beginning to worry successful employers?
    The Prime Minister: Yes, I agree with my hon. Friend that the figures today are very encouraging indeed. Unemployment has fallen for 21 months in succession and over the last year by about half a million. I agree with him also that we shall need more and more skilled people for the jobs that are available. I hope that everyone, including the trade unions, will support the new adult training scheme, which is intended to give skills to about 600,000 unemployed people to enable them to get the jobs that employers are ready to offer.
    Mr. Battle: Will the Prime Minister explain how 200 of my constituents, who are skilled workers and who received their redundancy notices from Courtaulds last week, have participated in the new prosperity that she says is for everyone?
    The Prime Minister: Yes it is difficult for anyone who suddenly faces redundancy, but most people understand that there must be a restructuring of industry. There has to be change. One cannot go on making goods for which there is no demand. The many people, from both sides of the House, who come to see me fully understand that these things have to happen and they set about trying to find companies to go to the area or people who will take up the enterprise allowance to create the jobs and work of the future.
    Mr. Stanbrook: To ask the Prime Minister if she will list her official engagements for Thursday 19 May.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Stanbrook: Will my right hon. Friend give some thought this afternoon to the constitutional difficulty that has been exposed by the fate of the Abortion (Amendment) Bill? When the Government are apparently neutral on an important moral issue it is quite impossible for that issue to be settled by means of a private Member's Bill, however meritorious is may be and however much support it may get in this place. Is there not therefore a duty on my right hon. Friend to change her mind about this single constitutional issue? Matters of this sort ultimately depend for decision on the Government giving the opportunity for them to be settled in Government time. It will take only a few minutes one evening at the end of business to settle this one way or the other.
    The Prime Minister: I would not necessarily accept that there is a constitutional difficulty of the kind that my hon. Friend describes. Many of us have had to take through private Member's Bills that started by being very controversial, and some of us handled them in very different ways. A great deal depends on that, and I do not accept that there is a constitutional difficulty just because this Bill has not got through. I think that the decision we took not to provide time for private Member's Bills was correct.

Business of the House
3.31 pm
Mr. Frank Dobson: Will the Leader of the House state the business for next week?
The Lord President of the Council and Leader of the House of Commons (Mr. John Wakeham): Yes, Sir. The business for next week will be as follows:
MONDAY 23 MAY—Opposition Day (12th Alloted Day) (2nd part). Until seven o'clock there will be a debate on an Opposition motion entitled "The Crisis in Housing".
Remaining stages of the Firearms (Amendment) Bill.
TUESDAY 24 MAY—Consideration of Lords Amendments to the Employment Bill.
WEDNESDAY 25 MAY—Motion to take note of the White Paper on developments in the European Community July-December 1987 (Cm. 336).
THURSDAY 26 MAY—Motion for the spring Adjournment.
Motions on short speeches and public petitions.
Motion on the Lord Chancellor's Salary Order.
FRIDAY 27 MAY—Adjournment motions.
Mr. Dobson: I thank the Leader of the House. In view of the revelation earlier this week that decisions have been taken in principle and in secret about the replacement of one category of nuclear weapons, can we expect an early debate on defence?
May we expect a debate on competition policy before control of Rowntree Mackintosh is transferred from York to Switzerland?
When can we expect a debate on foreign affairs—the debate that the right hon. Gentleman has been promising for some months now?
Finally, in view of the need to improve and update communications in the House, will the right hon. Gentleman tell us when the Services Committee can expect to receive the reports from the Property Services Agency on the replacement of the annunciator system, and from British Telecom on the electronic mailing experiment, both of which have been outstanding for more than a year?
Mr. Wakeham: The hon. Member for Holborn and St. Pancras (Mr. Dobson) has asked me four questions about next week's business. The first was about a debate on the defence White Paper. In due course there will be an opportunity for a debate on that. I understand that the Select Committee on Defence will be taking evidence and producing a report, and it would be better to wait for that before we arrange a debate.
The next question was about competition policy and the matter of Rowntree. I answered a question on this last week when I said that my right hon. and noble Friend was awaiting a report from the Office of Fair Trading. There is nothing that I can add to what I said then.
The hon. Gentleman asked about a foreign affairs debate. I recognise that there is concern about and a need for a debate on foreign affairs, and I shall seek to arrange that as soon as possible.
The hon. Gentleman asked me about the annunciator screen report and British Telecom's electronic mailing system report. The hon. Gentleman kindly gave me notice that he would be asking about these matters. I understand that both reports will shortly be submitted to the Computer Sub-Committee. The consultants' final report
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on the annunciator screen was recently received by the Parliamentary Works Officer, who is now considering it. A draft report on the British Telecom electronic mailing system prepared by the Central Computer and Telecommunications Agency is with the working party involved in the trial of this system.
Several Hon. Members rose—
Mr. Speaker: Order. This is an Opposition day. May I remind the House that business questions should be confined to business for next week and should not be on general topics?
Mr. James Wallace: The Leader of the House said that there would ultimately be a debate on the defence Estimates. Does he accept that it would be preferable for the Secretary of State for Defence to make a statement about any new nuclear weapons system to this House and not on "Panorama"? Will he have an opportunity to make that statement next week? Now that the motion about the Select Committee on Procedure is on the Order Paper, does the Leader of the House have any proposals to bring that motion to the House so that the Select Committee on Procedure can now be set up?
Mr. Wakeham: I will obviously refer the point about defence to my right hon. Friend, but the defence White Paper debate is probably the best time to deal with these matters. The House will have noted that the motion to re-establish the Select Committee on Procedure is on the Order Paper, and I hope that it will be agreed before Whitsun.
Sir Bernard Braine: Has my right hon. Friend seen the report in The Independent that the deputy Leader of the Opposition has tried to persuade Mr. Speaker not to select the new clause on abortion put down for debate on the Criminal Justice Bill, which I understand must be debated very soon? In view of this and the disgraceful ploys which prevented the House from coming to a decision on this matter last Friday week, will my right hon. Friend give an assurance, first, that there will be a free vote on the amendment—assuming that Mr. Speaker selects it? Secondly, if there is any attempt at obstruction to prevent the House arriving at a decision, will he give us an assurance that the Government will not hesitate to move a motion in accordance with precedent?
Mr. Wakeham: My right hon. Friend raises the question of the selection of amendments on the Criminal Justice Bill. Of course, the selection of amendments on that Bill is a matter not for me but for you, Mr. Speaker. He also makes the point, which I would expect him to make, about the desirability of a structured debate on these matters. Obviously, we shall address our minds to that when we see the selection. At one time, matters of whipping were my responsibility, but I am glad to say that it is one of the responsibilities that I no longer have.
Ms. Joan Ruddock: When the Leader of the House answered the question about a debate on the defence Estimates, I fear that he misunderstood the point that was made by my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson). There has been a revelation through the media—[HON. MEMBERS: "Where?"] There has been a revelation that new nuclear weapons decisions have been taken. Can the Leader of the House tell us whether it is therefore right that the House

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should he informed about this matter, and that there should be a proper debate? These decisions are being taken in secret and it is against the interests of the House that that should be done in this way.
Mr. Wakeham: The hon. Lady should not necessarily believe everything that she reads in the newspapers. I have said that I shall refer the matter to my right hon. Friend the Secretary of State for Defence. If he thought it appropriate to make a statement to the House, of course he would do so; but I said that probably the best way to proceed was to have the annual defence debate in the normal course.
Mr. Ian Gow: Will my right hon. Friend reconsider the answer he has just given? Would it not he of great advantage to the House and to the nation if there were to be a debate on nuclear defence policy, so that the Labour party could expose its differences on the matter?
Mr. Wakeham: My hon. Friend tempts me, because that would be an important debate, but there are many other important debates, and much important legislation that I should like passed through the House as soon as possible.
Rev. Martin Smyth: The Leader of the House is aware that I have been pressing on different occasions for a debate on devolution. In the light of the Prime Minister's statement in Scotland last week, could we have a debate in the near future? Alternatively—this might be more practicable could Northern Ireland be allowed into the benefits of that unitary state?
Mr. Wakeham: I recognise the hon. Gentleman's persistence in raising these matters, which are very important to him. I cannot promise a debate in the immediate future, but I will bear his representations in mind.
Mr. James Kilfedder: The Home Secretary is thinking about the introduction of electronic tagging for prisoners. Would the Leader of the House think of introducing it for right hon. and hon. Members, as it would be interesting to know where some of our distinguished colleagues are when they are not in the Palace of Westminster?
Mr. Wakeham: No, Sir. I have no plans to do such a thing. Quite a number of hon Members could go a long way away and I should not miss them.
Mr. Harry Cohen: Will the Leader of the House reconsider having a statement or debate on the new nuclear weapons matter, which the Secretary of State for Defence has announced? It has not been just in the press, as the Secretary of State has announced it to the Select Committee and on "Panorama". Many people will think that the Government have something to hide if they do not have a debate on this important matter. Will the Leader of the House ensure, at the same time, that there will be an early transcript of what the Secretary of State said to the Select Committee so that we can see the way in which he has been deceiving the House on this matter over a number of years?
Mr. Wakeham: I am not sure whether the hon. Gentleman's logic adds much to the debate. As i understand it, he says that my right hon. Friend the Secretary of State has announced this to a Select
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Committee, but is also trying to conceal it. Giving evidence to a Select Committee is not the most obvious way to conceal something.
Sir Peter Emery: On Thursday next week we are to have a debate on the spring Adjournment, and then on one of the procedure motions, which is to be on short speeches, as I understand it. It should come on between 7 pm and 7.30 pm, as the Adjournment debate will last for three hours. Has the Leader of the House considered any of the other motions brought forward by the Procedure Committee, because some matters other than short speeches could be dealt with if the debate is brief?
Mr. Wakeham: I recognise my hon. Friend's interest in these matters. The motion that I shall bring forward for debate next Thursday will be on short speeches and public petitions, dealing with two matters that I hope we can dispose of. I hope to arrange a further debate shortly in which we can discuss the other matters that I know are of concern, on which my hon. Friend knows I shall be having talks.
Mr. Bob Cryer: Could we have a statement on lobbying next week as a matter of urgency? The Leader of the House will recall that I raised with him the position of Mr. Peter Luff, who is employed by "Good Relations" yet is an adviser to the Secretary of State for Trade and Industry. The Secretary of State is not even a Member of the House; therefore he is not directly accountable. "Good Relations" is being investigated by that Department over the Guinness affair. This is highly unsatisfactory. Lobbying is spawning around this place and it is about time that we had a debate on it, or a statement at the very least.
Mr. Wakeham: Mr. Luff, and indeed all special advisers, are employed on agreed and proper terms, in accordance with Civil Service practice. I do not believe that there is a need for a debate on that matter. I notice the Select Committee's proposals about changes, and a further look at lobbying, but I do not foresee the need for a debate.
Mr. William Cash: Will my right hon. Friend note that the Companies (Audit Committees) Bill was yesterday thrown out of the other place? That legislation was introduced by the late Member for Kensington and was quickly passed in this House a few weeks ago. Will my right hon. Friend consider the possibility of that legislation coming back later in the year in the form of a Companies Bill? Many hon. Members and people outside the House would be grateful for that.
Mr. Wakeham: I am sure that the whole House would want me to say how much we shall miss Sir Brandon Rhys Williams. He did not always, over many years, make himself comfortable with the Government—he had views of his own—but I shall certainly miss his lively intellect and his contributions to our debates. I cannot promise, however, that there will be such legislation. Whether the Government decide to introduce a Bill containing these or similar proposals is a matter not for me but for my right hon. Friend the Secretary of State for Trade and Industry.
Mr. Tam Dalyell: Has the Leader of the House noticed that, on Tuesday, there is to be a reachable oral question—one of the few, I am told, ever to have been tabled in this way and allowed—on the role of the SAS?

1101
Will the right hon. Gentleman take on board the fact that, whatever is said by my hon. Friend the Member for Brent, East (Mr. Livingstone), there are serious Members on both sides of the House who are increasingly worried about under what authority and on whose authority the SAS operates? What are its rules of engagement? This question extends to cases such as that of Michael Tighe. Is there not a case for the Government making a statement on this matter—this would possibly be to their advantage—to clarify suspicions? There are certainly suspicions about the use in this connection of the royal prerogative.
Mr. Wakeham: I recognise the hon. Gentleman's persistence. I cannot possibly anticipate any answers to questions next week. Although the hon. Gentleman puts forward his view with all seriousness, there are others of us, on the Conservative Benches particularly, who would say that the security of the state requires that some things cannot be the subject of the to and fro of political debate in the House.
Mr. Andrew MacKay: I do not wish to prejudge any decisions that you, Mr. Speaker, will have to make on selecting new clauses to be considered in the debate on the Criminal Justice Bill. As more than 120 right hon. and hon. Members on both sides of the House signed an amendment reducing to 24 weeks the time limit for abortion when the Abortion Bill was considered in the House, does my right hon. Friend think that it would be helpful for a new clause to be introduced into the Criminal Justice Bill which would incorporate Lord Houghton's Bill—the Infant Life (Preservation) Bill—which would amend the Infant Life (Preservation) Act 1929?
Mr. Wakeham: Not surprisingly, the new clauses that I wish to see introduced into the Criminal Justice Bill are those introduced by my right hon. Friend the Home Secretary. My purpose is to get the Bill passed. As I have already said, the selection of amendments is not a matter for me.
Mr. Dennis Skinner: Does the Leader of the House recall that in the summer recess I wrote to him about what was to happen to the Short money for the Opposition parties? The delay has been exaggerated once again, after all these months, because of the leadership crisis in the SLD. Although we in the Labour party fully understand that we might have to wait for the money—[Interruption.]—none of it will come to me; it is for the Front Bench. [HON. MEMBERS: "What about your leadership crisis?"]. When will there be a debate? Will the Division be along the lines of representation in the House? How will the right hon. Gentleman manage to figure out the arithmetic? Is the right hon. Gentleman aware that some members of the Liberal party want to go to the television studios, get dressed up ready for when the cameras come into this place and buy their pink shirts and all the rest of it, and they need this money? When will they get it?
Mr. Wakeham: As I told the hon. Gentleman, among my souvenirs is the handwritten letter that he wrote to me setting out the problems of the allocation of Short money in the new Parliament. The hon. Gentleman was right to say that it was not as simple as some people thought. He knows that I have been struggling with this matter for
1102
many months, but I think that I see some light at the end of the tunnel. I hope to emerge in the fairly near future into the public gaze with my proposals. I can forecast one thing—they will not be accepted by everyone, and probably not by the hon. Gentleman.
Mr. Teddy Taylor: Could there be a statement next week on the EEC's remarkable decision last week, without the British Government being consulted in any way, to impose a ban on imports of apples to Britain? If consumers in Britain are to be deprived of the right to buy the apples that they want and are forced to buy year-old apples from intervention produced in other countries, is it not sensible that there should at least be a statement or a discussion in Parliament about what is happening?
Mr. Wakeham: I recognise my hon. Friend's concern about these matters. The decision to impose quotas on the import of apples from a number of countries, including New Zealand, was taken by the EC Commission, within whose competence it lies, without consultation with member states. The quota of 115,000 tonnes allocated to New Zealand is higher than sendings in any previous year and compares with the import in 1987 of 102,500 tonnes. A shortage of those excellent apples therefore appears unlikely.
Mr. Robert Maclennan: Is the Leader of the House aware that, in his answer to the hon. Member for Linlithgow (Mr. Dalyell), he enunciated a novel and unacceptable constitutional doctrine—that there are matters that about which the House may not question the Government because his hon. Friends think that it is not suitable that they should be questioned about such matters? If there are security matters that are not to be made the subject matter of question in this House, they had better be finely defined and there should be independent scrutiny of such matters by a committee of Privy Councillors.
Mr. Wakeham: If the hon. Gentleman would listen, he might make a little progress in these matters. I did not say that no one could ask questions. I said that there were some things that Ministers should not answer on and I will maintain that from the Dispatch Box for as long as I am here. There are some security matters that I am not prepared to have discussed across the Dispatch Box, even if the hon. Gentleman asks me.
Mr. Harry Greenway: May we have a debate next week on what can be done to help people whose homes are damaged by severe freak storms, such as that in Northolt, Greenford and parts of Hanwell and Ealing last week, as a result of which many poor people have been devastated? They have had walls knocked down by heavy water and their ground floor carpeting and furnishings have been destroyed. Finding themselves without any money, they do not know what to do. Their case should be brought to this House and answered.
Mr. Wakeham: That sounds a very distressing state of affairs and I am not sure whether I can give my hon. Friend an adequate answer. Perhaps he should take advantage of the Adjournment debate next week and see whether he can bring the matter before the House on that occasion.
Mr. Michael Foot: Referring to the right hon. Gentleman's answers about the suggestion that a new clause might be moved on Report to the Criminal Justice Bill, he is right in saying that any selection would be a matter for Mr. Speaker and not for him. If new clauses of such a far-reaching character on such different matters were to be introduced into the Bill on Report, it would have grave consequences for the Government, and every other piece of legislation that they are seeking to introduce might be subject to the same kind of interpolations. I hope that the right hon. Gentleman will take that into account when he considers the matter and gives advice to the Home Secretary, who may be interested in his advice and that of the House.
Mr. Wakeham: The points made by the right hon. Gentleman, who is very experienced in these matters and is a former Leader of the House, are properly for the Home Secretary and me to consider from the Government's point of view, although questions of selection are matters for the Speaker.
Mr. Roger Knapman: Some months ago, the hon. Member for Brent, East (Mr. Livingstone) made allegations in this House concerning the late Captain Nairac, whose family lives in my constituency. Did my right hon. Friend notice today that the hon. Gentleman has again named people—
Mr. Speaker: Order. The hon. Gentleman should relate his question to next week's business.
Mr. Knapman: May I ask my right hon. Friend whether this matter can be debated in the course of the next week or so, and how, if Parliament is to be televised, such privileges can be maintained in future?
Mr. Wakeham: I see no prospect of arranging a debate on that matter next week or any future week on the basis of that point. My right hon. Friend the Prime Minister deplored the use of parliamentary privilege to make allegations which are properly a matter for the prosecuting authorities. Anybody with information of that sort who wishes to pursue the matter has a clear duty: he should give the matter in confidence to the prosecuting authorities, rather than seek to make statements in the House.
Mr. David Blunkett: Among the debates that the Leader of the House said he would have liked to fit in next week, would he consider including a debate which we should be having on the 500 per cent. increase in the cost of concessionary television licences and the considerable suspicion in the minds of pensioners who are receiving it that this increase from 5p to £5 is the beginning of a move to phase them out completely?
Mr. Wakeham: The concessionary licence scheme for pensioners in residential homes has been in existence for many years. The changes announced yesterday by my right hon. Friend the Home Secretary will enable it to continue and will ensure that the scheme benefits those whom it was intended to benefit. As we have made clear on many occasions, it would not be right or sensible to give free or concessionary licences to all pensioners.
Mr. Peter Thurnham: If we are not to have a debate next week on the Criminal Justice Bill because of attempts to hijack it, does my right hon. Friend agree that careful consideration should be given to how to
1104
structure a debate on new clauses which formed no part of the title of the Bill and were not debated on Second Reading or in Committee?
Mr. Wakeham: I hear what my hon. Friend says. We are not having a debate next week because we have other important business that we intend to get through. We shall have debates on the Criminal justice Bill in the near future, when I shall bear my hon. Friend's point in mind.
Mr. David Alton: When the Leader of the House considers how to handle the Criminal Justice Bill, will he consider the precedent set in 1980 when the right hon. Member for Blaenau, Gwent (Mr. Foot) was Leader of the Opposition and amendments to the Criminal Justice (Scotland) Bill which had not been considered m Committee were incorporated on Report after being moved by the Opposition Front Bench? Since 1975, every pro-life Bill has received a Second Reading majority. If 15 attempts to introduce pro-life Bills have all been foiled by extended speeches, points of order and hon. Members deploying the mechanisms of this House, how does the right hon. Gentleman envisage this issue being properly settled? Does he regard it as a matter for private Members' legislation or to be settled in some other way? If in another way, what way?
Mr. Wakeham: The hon. Gentleman knows that I do not fully accept his analysis of the failure of Bills on this subject to reach the statute book by private Member's legislation, but I recognise the force of his arguments. I further recognise that there is an amendment to the Criminal Justice Bill, but I do not have anything more to add to what I have already said on what is clearly a difficult decision for you, Mr. Speaker.
Mr. Bill Walker: Will my right hon. Friend reconsider his views on a defence debate? It is essential to hold one soon because it will show the enormous differences of view on the Opposition Benches. More important, it would expose the fact that Royal Air Force pilots would be expected to enter the next war, if it ever took place, at great risk, and that the lessons of 1939, when the British Expeditionary Force went to France to fight Hitler's tanks with rifles, had been forgotten.
Mr. Wakeham: I recognise the desire for an early defence debate, but I cannot promise one. I know that my hon. Friend is aware that defence questions will be answered next Tuesday, 24 May, and he may find an opportunity to make some points then.
Mr. Michael J. Martin: During the next week, would it be possible for the Leader of the House to speak to his right hon. Friend the Secretary of State for Social Services about tribunal appeal claims? I am increasingly receiving complaints from constituents who are claiming attendance allowance that at these appeals they are being asked questions which I consider to be insensitive. The latest case involved a girl who is only 3ft 7in tall who was seeking a mobility allowance because her height meant that she had difficulty getting on and off buses. She was asked why she was wearing rings. I received another complaint from a woman suffering from alopecia, who was asked why she was wearing an expensive wig. Surely a medical appeal tribunal should not ask such questions of people with those difficulties.
Mr. Wakeham: I recognise the hon. Gentleman's concern for his constituents. If he is concerned that improper questions are being asked, perhaps the right course would be for him to take the matter up directly with my right hon. Friend the Secretary of State for Social Services, who will decide whether there is anything to be looked into.
Mr. John M. Taylor: Will my right hon. Friend take time to have a word with his right hon. Friend the Secretary of State for Transport and ask him to come to the House early next week to make a statement about the near miss that occurred yesterday afternoon on the flight-path into Birmingham airport? Many people who use that airport will want to be assured about its absolute safety. The airport is crucial to the welfare of the midlands.
Mr. Wakeham: The incident to which my hon. Friend referred will be investigated by the independent joint air miss working group, whose report will be publshed. The Civil Aviation Authority is responsible for taking any necessary safety action arising from the incident. That action need not wait until the report is published. However, there is no evidence of any deterioration in the safety in the air over the United Kingdom. Despite a massive increase in traffic, the figures for risk-bearing air misses involving commercial aircraft in recent years have shown a downward trend, from 45 in 1977 to 16 in 1986.
Mr. Nigel Spearing: The Leader of the House has announced that a debate on EEC matters for the last six months of 1987 will take place next Wednesday. Will that debate last for five hours, six hours or less? Whatever the length of time, is the Leader of the House not in danger of getting his priorities wrong? Is he not aware that the June meeting of the Council of Ministers in the EEC will have to consider many matters which have not yet been debated by the House although they have been recommended for debate by the Scrutiny Committee? Would it not be better to ensure that those matters are properly debated in respect of future legislation rather than spend time on retrospective matters over which the House can have no influence?
Mr. Wakeham: I recognise the hon. Gentleman's knowledge and experience in those matters and I always listen carefully to what he says. I believe that the debate that I have announced for next week is for the general convenience of the House; it was discussed through the usual channels before I announced it. However, I take note of what the hon. Gentleman has said, and I will have further discussions.
Mr. Tony Favell: My right hon. Friend will be aware that Manchester city council has been blocking an inquiry into its anti-racism policy in schools. It is said that the report is now on its way to my right hon. Friend the Secretary of State for Education and Science—at least, an expurgated version is on its way. When that is received, will my right hon. Friend the Leader of the House ask his right hon. Friend the Secretary of State for Education and Science to make a statement to the House? Many Conservative Members are worried that such policies, far from promoting racial harmony, actually discourage it?
Mr. Wakeham: My hon. Friend makes his point very well and I will refer the matter to my right hon. Friend the
1106
Secretary of State for Education and Science who will no doubt take whatever action he feels is appropriate in the circumstances.
Mr. Ray Powell: Can the Leader of the House arrange a debate next week on my early-day motion 792 about grandparents' rights?
[That this House deplores the increasing frequency of grandparents being deprived of the right of access to, care, fostering or adoption of their grandchildren; notes with alarm the attitude of some social services employees; and calls on Her Majesty's Government to introduce early legislation to give legal rights to grandparents providing immeidate right of access before children are taken into care and the right to be present or legally represented at any official hearing or inquiry regarding future access to, care, fostering and adoption of their grandchild or grandchildren.]
Is he aware that it has received the signatures of 266 hon. Members from both sides of the House? It is covered by a petition that I presented to the House signed by 8,000 grandparents across the country. Is the Leader of the House also aware that my motion has received the greatest number of supporting signatures of the 1,127 early-day motions that have been tabled this Session? Is it not time that he gave priority for a debate on this very emotive subject?
Mr. Wakeham: I agree that it is an important subject, and I congratulate the hon. Gentleman on the support that he has received. With regard to the early-day motion, grandparents may already be made the party to adoption proceedings. Further rights are provided for in amending legislation to be implemented this year. The Government will give careful consideration to the proposals in the motion when framing the legislation on child care and the family services provided for in the White Paper published in January 1987. I hope that that is some comfort to the hon. Gentleman, but I cannot find time for a debate next week.
Mr. Julian Brazier: May I put it to my right hon. Friend that there is a way this week whereby he could get you, Mr. Speaker, out of a very difficult decision, and allow the Government to maintain their principle of not giving Government time to private Members' Bills while allowing the country to see the verdict that it expects from Parliament? Quite simply, we could have a business motion to allow the House to vote on whether it chose to use some of its own private Members' time on a Friday to finish the Alton Bill.
Mr. Wakeham: Would that all these things were quite as simple as my hon. Friend suggests. The Government table motions with regard to the allocation of private Members' time in the House. We gave extra time over and above that laid down in the Standing Orders for private Members' Bills. Those were approved by the House and I do not believe that it would be right to make a change in that regard.
Mr. Greville Janner: Would the Leader of the House himself make a statement next week on the extraordinary revelation that an honorary British knighthood has been awarded to none other than one Kurt Waldheim? If that is not a matter for the right hon. Gentleman, will he undertake to refer it to his appropriate

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colleague who can advise the House as to this obviously offensive and iniquitous use of an ancient order of British chivalry?
Mr. Wakeham: I am pretty certain that it is not for me to answer questions in the House on those matters. However, I will investigate to see whether there is any responsibility that involves answering questions.
Miss Ann Widdecombe: With reference to the various answers that my right hon. Friend the Leader of the House has given this afternoon on the amendment tabled to the Criminal Justice Bill, while I respect entirely his position and the courtesy that he has shown when dealing with those queries, when the Government have been able to show consistently over a period that they expected an amendment on capital punishment to be discussed, why can they not give a similar sign in the case of the amendment on abortion?
Mr. Wakeham: Even the undertaking about capital punishment depends on Mr. Speaker selecting the amendments. I recognise that my hon. Friend has worked very hard for the cause which she believes to be important. I thank her for her kind remarks. but it would not be right for me to add anything further to the remarks that I have made already.
Several Hon. Members rose—
Mr. Speaker: Order. I repeat that this is an Opposition day; I ask hon. Members to be brief.
Mr. D. N. Campbell-Savours: When I table my early-day motion requiring that Privy Councillors be not given priority in the selection of speakers in debate, may I have an assurance that Government Whips will not exert pressure on Government Back Benchers not to sign the motion? May I have an assurance that all hon. Members will have an unconditional right to sign my motion without pressure?
Mr. Wakeham: Knowing the hon. Gentleman as well as I do, I should be able to acquit him of charges of arrogance. However, if he continues to ask such questions, demanding that I support his early-day motion before he has tabled it, he will receive a rather dusty answer.
Mr. Harold McCusker: Has the Leader of the House noticed how easy it has been for the Government to apply large segments of the Firearms (Amendment) Bill to Northern Ireland and how simple it was for a Conservative Member to apply the Motor Vehicles (Wearing of Rear Seat Belts by Children) Bill to Northern Ireland? Bearing in mind what the Prime Minister said in Perth last Friday about legislative devolution, when will the Government govern Northern Ireland like the rest of the country?
Mr. Wakeham: I shall not anticipate at the Dispatch Box the debate on the Firearms (Amendment) Bill or any debates on seat belts. I know that the hon. Gentleman is considering wider issues and wants to see changes in the way in which the House considers matters relating to Northern Ireland. I recognise those concerns and I have had talks with several of his hon. Friends about that. However, I am afraid that I have no proposals at the moment to make any changes.
Mr. Jeremy Corbyn: Will the Leader of the House consider that it is now important that there be an early debate on the situation facing the people of London in respect of the housing crisis and the shortage of housing for rent, the high unemployment that many inner-city places face, the cuts in the Health Service and the amalgamation of health authorities, and the growing chaos in traffic and transport throughout London? Since the House destroyed the governance of London through the GLC and since most inner-London boroughs are rate-capped or short of money, is it not important that we should debate the plight of the poorest people of London at an early date? On previous occasions, the Leader of the House has said that there would be a debate in the near future. Can he now give us a date for that?
Mr. Wakeham: No, I cannot give a date. I have said that that is a suitable subject for a debate and, if I can find time for it, it would be a proper subject on which to have a debate. The more the hon. Gentleman raises such questions, the more encouraged I am, because much of what he says is highly contentious and such a debate would be a suitable opportunity for him and for some of his hon. Friends to explain, for example, why so many council houses in London are unoccupied where Socialist councils are in charge.
Mr. Pat Wall: In view of the manifest failure of the EEC code of conduct for firms doing business in South Africa, emphasised by yesterday's annual general meeting of the BTR company, when shareholders asked questions about the dispute which has lasted for three years and which clearly shows that company to be in breach of the three main provisions of those guidelines, will it be possible in the EEC debate next week to discuss the conduct of British firms in South Africa under the EEC provisions, and the whole issue of trade with that country?
Mr. Wakeham: What is in order in a debate is not a matter for me, but for you, Mr. Speaker. On the face of it, I would have thought that if the hon. Gentleman used some ingenuity he might be able to make some of the points that he wants to.
Mr. John Home Robertson: Since the Leader of the House and his colleagues have failed to establish a Select Committee on Scottish Affairs. is he aware that Members of the Scottish majority party have resolved to establish their own investigative committee, which may well have support from other parties in the House? Since funds have been made available to support an investigative committee to monitor the work of the Scottish Office, will the Leader of the House make a statement next week to ensure that those hon. Members who are prepared to do their duty in scrutinising the work of the Scottish Office will have access to those funds?
Mr. Wakeham: I shall not be making a statement next week, but I am prepared to make a statement now on the Select Committee on Scottish Affairs, if that will he any help to the hon. Gentleman.
I have been anxious for a considerable time to set up the Select Committee on Scottish Affairs on a basis acceptable to all parts of the House. During that period, the Labour party's position has changed on a number of occasion
That has been helpful. The proposal that I have recently put to all parties is for the Select Committee on Scottish

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Affairs to be set up with mainly Scottish Members but with some English Members, and my proposal includes a place for the Social and Liberal Democratic party and the Scottish National party.
In order to achieve that objective, I have asked for some greater flexibility in the composition of the Scottish Standing Committee, which could involve a slight increase in the number of English members. I understand that my proposals are not acceptable to the Labour party, which I greatly regret. I have not yet had a formal view from the Social and Liberal Democratic party and the Scottish National party. That is the position at the moment.

Business of the House

  Whitsun Adjournment
  4.13 pm
  Mr. Speaker: I remind hon. Members that, on the motion for the Adjournment of the House on Friday 27 May, up to eight Members may raise with Ministers subjects of their own choice. Applications should reach my office by 10 pm on Monday next. A ballot will be held on Tuesday morning and the result made known as soon as possible thereafter.

Debates (Selection of Speakers)
4.14 pm
Mr. Ian Bruce: On a point of order, Mr. Speaker. May I have your guidance for future reference? You will know of my interest in Scottish affairs, coming, as I do, from Scotland. I am sure that when regulations on the community charge for students are brought before the House in a year or so, the experience of hon. Members who sit for Scottish constituencies will be valuable. As you know, I have been selected to serve on the Committee that is considering the School Boards (Scotland) Bill. I attempted to speak in yesterday's debate on the community charge for students and various points that I wished to make on education, and so on, would have been valuable. However, there seems to be a way of selecting Members that rightly gives priority—
Mr. Speaker: Order. I think that that is a reflection upon the Chair. It is the duty of for the occupant of the Chair to take into account the specific interests of hon. Members. English Members have some interest in Scottish affairs, just as Scottish Members have an interest in English affairs, because this is a United Kingdom Parliament. However, I hope that the hon. Gentleman will not challenge the selection of the Chair. I understand that he intervened a great deal last night.
Mr. Bruce rose—
Mr. George Foulkes: Further to that point of order, Mr. Speaker.
Mr. Speaker: Points of order only delay the Opposition day. However, I call Mr. Foulkes.
Mr. Foulkes: Further to that point of order, Mr. Speaker. I would be willing to meet the hon. Member for Dorset, South (Mr. Bruce) to give him the long list of Scottish debates in which I have tried, unsuccessfully, to speak, and I do represent a Scottish constituency.
Mr. Nicholas Bennett: Further to that point of order, Mr. Speaker. The selection of Members from the Government and Opposition Benches is a matter of obvious importance to me as a Welsh member. I have no wish to challenge Mr. Deputy Speaker's decision last night, but it would be useful to have some guidance on whether the Chair seeks to choose hon. Members from both sides of the House in order to have a balanced debate—or not, as happened last night, when four Opposition Members in a row spoke despite the fact that Conservative Members wished to speak.
That has obvious implications for other debates. A similar situation arose in the Welsh Grand Committee on 15 July last year, when Opposition Members took up the majority of debating time. Last night, in the 71 minutes of debate, Government Back Benchers had nine minutes and the remainder of the time, apart from the Minister winding up for 12 minutes, went to the Opposition. Such debates could be unbalanced as a result.
Mr. Speaker: I must bear in mind what the hon. Gentleman says when we have a Welsh debate, because he is frequently, perhaps over-frequently, called in Welsh debates.
Mr. Tim Devlin: Further to that point of order, Mr. Speaker. As a matter of principle, is it correct that there is nothing to prevent English Members from being called to speak in debates relating either to Scotland or Wales?
Mr. Speaker: That is absolutely correct. I know that the hon. Gentleman is not making a complaint, because we discussed that matter last night.

Opposition Day
[I2TH ALLOTTED DAY] [IST PART]
Opposition Day

  Shipbuilding
  Mr. Speaker: I have selected the amendment in the name of the Prime Minister.
  4.17 pm
  Mr. Brian Gould: I beg to move,
  That this House, deeply concerned at reports that Her Majesty's Government intends to withdraw all financial support from British Shipbuilders, and aware of the grave threat to British merchant shipbuilding posed by the contractual problems of NES'. and the uncertain future of Govan yard, calls upon Her Majesty's Government to affirm its commitment to British merchant shipbuilding and provide the support needed to sustain this essential British industry.
  We have drafted, the motion because we believe that a once great and still vital British industry is in mortal danger. There have been many occasions in the past when that claim has been made in respect of British shipbuilding. There have been many debates in the House in recent years in which grave fears have been expressed about the survival of that industry, but I truly believe that on this occasion the claim is justified, that this really is crunch time for British merchant shipbuilding, and that there is an axe poised over the industry which, in a sense, only the Minister can remove.
  The purpose of the debate and the motion is to invite the Minister to make it clear that he sees, as we do, an important future for this essential British industry. We intend—I am sure that the Chancellor of the Duchy of Lancaster will understand this—to use the debate to seek answers to questions, and to ask him to allay fears, Lo dispel rumours, to remove doubts and to make clear his commitment, and that of the Government, to the future of British shipbuilding.
  No one disputes that British shipbuilding has gone through an extremely difficult period. Shipbuilding worldwide has had a difficult time because of the depressed state of demand for shipping, but the current problems that have arisen in respect of North East Shipbuilders—the Govan and Appledore yards—arise not just in the context of that difficult worldwide situation, but as the direct consequence of steps that the Government have failed to take. It is the Government who have raised those question marks; that is why we ask the Government to remove them.
  The Government are exhibiting their now-familiar predilection for the triumph of ideology over the future of an important British industrial sector, together with their preoccupation with raising cash by disposing of those parts of the industry which can be sold off, accompanied by a willingness—at least implicit and increasingly clear—to junk those parts which cannot be sold off. That attitude threatens the taxpayers' investment, jobs, the regional economy of the north-east and the south-west, and the continued survival of an essential component in our industrial future.
  The current problems are the obvious, inevitable and possibly even intentional consequence of the

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  Government's attitude in the past, with their determination to dismember British Shipbuilders. They set sail on that course four or five years ago, when they began privatising the naval warship yards. It was always on the cards that, as the more viable parts of British Shipbuilders were disposed of, the increasingly small number remaining would face the growing threat of non-viability.
  When the Chancellor of the Duchy of Lancaster made his statement in the House on 18 April, and in statements that he has made elsewhere in recent days, there were hints that the Government's argument was that it was somehow inevitable, and a logical consequence of the process of dismemberment, that those parts of British Shipbuilders which remain cannot be sustained; that buyers or recipients must be found for them and that the rest must go to the wall. The Chancellor will not be surprised if I give him notice that we reject the inevitability of such an outcome. We will use this debate and future occasions to make clear our commitment to the industry and our belief that it would be wrong, not to say active industrial sabotage, to allow what remains of British merchant shipbuilding to go to the wall in the way that the Government contemplate.
  When the Minister replies, I hope that the first matter to which he will address himself is the uncertainty which exists in respect of the Govan yard in particular. On 18 April, the House was told that someone—I am tempted to say a buyer, but I am not sure that is the right term—had been found to take the Govan shipyard off the Government's hands, and that the lucky candidate was the Norwegian gas ship firm of Kvaerner Industries. The House was informed that it was to take over rather than purchase the company; as we understand it, it is more a matter of a giveaway than a sale. As my hon. Friend the Member for Great Grimsby (Mr. Mitchell) has often said, it is rather like saying, "You like the ships? Have the yard as well."
  If the yard is a viable proposition for a Norwegian gas ship builder, and if that company believes it can make the yard a going concern, why cannot the Government accept that the yard can be made viable and have a future? This seems to be another example of the Government's willingness to get shot of a public asset at almost any price.
  No one begrudges the Govan shipyard and all who work there the chance of a viable future. We on this side of the Chamber will take great care not to say anything that would in any way jeopardise that future. We understand the precarious nature of the situation and the importance of guaranteeing, so far as a guarantee can be given, the jobs in that part of the industry. However, we must have further information, assurances and guarantees as to exactly what is proposed.
  A month has gone by since we first heard the Minister's statement, and presumably the negotiations have made some progress. We hope that the Chancellor of the Duchy will be able to tell the House more about the outcome. His answers are of crucial importance to the British shipbuilding industry and to all those who work in Govan.
  We should like to know, for example, what exactly the Minister meant when he used the cryptic phrase "some restructuring" in his statement on 18 April. What does that mean in terms of existing jobs, future employment, the pensions of those who remain and of those who leave,
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  long-term investment, and so on? What does Kvaerner have in mind for the Govan shipyard? One can understand why it is that, having closed down its own yard and made hundreds of its own workers unemployed, the company now needs, at least in the short term, some cheaper—perhaps temporarily cheaper—capacity. It may be that, in the short term, some future exists for the Govan yard.
  We need to know what will be the future of the yard after Kvaerner's immediate objectives have been met. Will it be closed down, in the same way that the Norwegian yard was closed, and will Kvaerner then move on to another knockdown, giveaway yard in some other part of the world? What guarantee for the future is being offered to the Govan workers as a consequence of the deal? I hope that the Minister will provide answers to those questions.
  Another cryptic remark was contained in the Chancellor of the Duchy's relatively short statement on 18 April, relating to the transfer of the Appledore yard. The right hon. and learned Gentleman made it clear that there were buyers in the offing for that yard as well. On 18 April, my hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) pointed out that Appledore includes not just the north Devon yard but also the Ferguson yard in Port Glasgow. It is a substantial operation employing hundreds of people at the two sites, and it is essential that those workers be given some information at this stage, a month after the statement, about who is the prospective purchaser and what are its intentions.
  Many people in north Devon who depend upon Appledore for their employment are extremely alarmed. I am sure that the same is true of the workers at Port Glasgow. They are concerned that a private purchaser may use the acquisition and the assets of the yard not for shipbuilding but for property speculation. I hope that the Chancellor of the Duchy will dispel any fears that the workers may have. Four weeks after the right hon. and learned Gentleman's statement, both the House and those whose livelihood depends on those yards are entitled to more information.
  Although this subject is not strictly within the terms of the motion I have moved, I hope that the Minister will say something about Harland and Wolff, which is an important part of the British shipbuilding industry. He will know that there is in hand a project for the building of a major liner known as the Ultimate Dream, which will require substantial Government support. That support ought to be given because of the importance of Harland and Wolff to the Northern Ireland economy. I do not need to labour that point, because it is well understood.
  Less well understood is the reason why a substantial proportion of the work involved in building that massive liner—perhaps as much as 70 per cent. of it—will be undertaken by mainland suppliers and contractors. My hon. Friends and I have received many representations on that point, including those from Senior Green of Wakefield, which is competing for an order for two oil-fired boilers, five exhaust boilers and ancillary equipment; and Industrial and Marine Switchgear of Hull, which is competing for the order to supply switchgear.
  That makes a point to which I may return later. While the initial order for a ship is of course of great importance to the shipyard that is fortunate enough to get it, it has major implications for the back-up industry, the

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  hinterland of industrial activity that goes to support shipbuilding. In the case of Harland and Wolff, much of that benefit will be felt in mainland industry.
  The really urgent problem, however, and one which now demands a clear answer from the Chancellor of the Duchy, arises in respect of the most important remaining part of British Shipbuilders. Assuming that Govan and Appledore go, what will remain is North East Shipbuilders Ltd. The danger is that it will be left in a non-viable, certainly vulnerable and exposed, position.
  The fears arise not only because of the inevitable consequences of this process of dismemberment—this death by a thousand cuts—but because the position of the yard, which is of such importance to the regional economy, has unfortunately been exacerbated by the contractual difficulties that have arisen on the one remaining major order on which the yard is working.
  On 18 April, the Minister broke the news to the House that those difficulties had arisen. I hope and expect that in the ensuing four weeks he and his advisers, particularly his legal advisers, have been thoroughly involved in trying to sort out what appears to be a legal argument. I hope that he will be able to tell the House today that the difficulties have been resolved, or are well on the way to resolution.
  It is time for the Government to establish the truth of the matter. We have heard and continue to hear—this was stated in a television programme on which the Minister and I appeared together this morning—that the problems arose because of unsatisfactory work being done by the yard. That is a very prejudicial statement; it is prejudicial both to the good name of the yard and those who work in it, and to the proper resolution of the contractual problems.
  I hope that the Minister will take the chance to make it clear—as I believe to be the case—that the contractual problems have arisen not because of any unsatisfactory work done in Sunderland, but because the Danish customer is having difficulty either in finding the money to pay or in finding customers to whom to sell the ferries on. If either explanation is correct, I hope that the Minister will say so, but if the position is as I believe it to be, I feel that we are entitled to ask further questions.
  We shall need to know what the status of the order is, how much of it is to be carried out and how much of it is covered by the Export Credits Guarantee Department guarantee—which, after all, is offered by a part of the Minister's Department, and for which he must therefore take some responsibility. When I spoke to him some time ago about the matter, he did not know exactly what the effect or scope of the ECGD guarantee would be. I hope that by now he has informed himself and can tell us what would happen if—in the worst case—the Danish customer was unwilling or unable to pay, and the guarantee had to be applied in its fullest possible form. I hope that he will he able to explain how many ferries would then be built, and what that would mean for the continuing work programme on Wearside. That is the minimal information that is decently and properly required by those who are still busily engaged in building the ferries. They need to know what their future is to be.
  There is a further question. If the Danes drop out of the picture and the ECGD guarantee is not adequate to ensure the continued performance of the full contract, what are the prospects of finding other customers? The Minister will know that there is a strong belief in Sunderland, particularly on the part of the management at the yard,
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  that there is a real prospect—I am not competent to judge, but this is their belief—that the Cubans may be interested in buying at least some of the ferries. When my hon. Friend the Member for Sunderland, North (Mr. Clay) and I, along with others, spoke to the Minister a couple of weeks ago, he professed ignorance—or at least, considerable doubts—about the possibilities. I hope that he will now be able to tell us what the chances are, and what efforts he and his Department will make to bring them to fruition.
  These are real questions. We certainly do not intend to use the debate to rant and rave or score political points. We want to hear the truth—the facts—from the Minister, because that is what the work force needs to hear. We also hope for an answer to a much wider question. The question that we wish most of all to be answered, because the answer will provide the context in which all these matters are to be resolved, is this: are the Government still committed to the survival of the industry?
  We know, and the Minister knows as well, that there have been repeated reports—I am tempted to say authoritative reports—that the Government have made up their mind to pull the plug on British Shipbuilders, arid that they are looking for an opportunity later this year to announce that they will no longer provide the financial support that is still required if the industry is to be maintained. I hope that the Minister will make it clear that those reports are ill founded. I hope that he will say that the short-term contractual problems of North East Shipbuilders are simply that, and not an occasion or pretext for announcing that that part of British Shipbuilders, which is an important component of British merchant shipbuilding, is to be allowed to go to the wall.
  Mr. Eric S. Heffer: Surely, if the Government decide to withdraw financial aid from the shipbuilding industry—which seems likely—and to turn it over entirely to private enterprise, that is a political question. The Government's entire policy on shipbuilding over the years has been political. They have deliberately allowed the industry to run down for political, sectarian reasons related to their outmoded and outdated philosophy.
  Mr. Gould: My hon. Friend is right. I made the same point in my opening remarks. I believe that the Government's attitude to the industry has typically been dictated by exactly the political and ideological questions to which my hon. Friend refers. In fact, as I look for the point that I have reached in my speech, I see that my next remark was to be that unless the Government gave the commitment that we demand, we would be forced to conclude that this was yet another part of the British industrial steel base that was to be sacrificed on the altar of ideology.
  Of course no one wants subsidies for their own sake. No one would be more delighted than all the thousands of people whose jobs still depend on merchant shipbuilding if it were possible to say that they had a viable future without subsidy. But if the present Government are to take the high-handed view that nothing is to survive if it requires subsidy—I suspect that there are powerful voices, if not in the Department of Trade and Industry at least on the Tory Back-Benches, who would say exactly that—we must face

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  the fact that the worldwide problems of shipbuilding over the past decade have dictated that no shipbuilding industry in the world would have survived without subsidy.
  We are not in a unique position. We are not even in a position that applies to Europe but from which the far east is exempt. The Koreans and the Japanese are also subsidising massively. They are doing so because they know that that is the only way to maintain the capacity in that important industry, which they have decided for political reasons—my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) is right; they have made a political judgment—they want to survive.
  Therefore, the industries which survive this admittedly difficult period will not necessarily be the industries which pass the commercial test, because none of them would survive according to that test. The survivors will be those which are supported by Governments who make the political decision that they want to see national shipbuilding preserved because they recognise its importance to the national economy. That is what we ask and expect to hear from the Government. We want that political commitment so that we can be sure that the Government recognise the importance of the survival of the industry.
  When we turn to competitive matters, we are also entitled to say that British Shipbuilders and British merchant shipbuilding generally have done amazingly well; they have taken huge strides to improve their competitiveness and efficiency. When British Shipbuilders has slimmed down at the cost of many tens of thousands of jobs, when it has improved the flexibility of its work practices, and when taxpayers have contributed hundreds of millions of pounds of investment to the point where British Shipbuilders and NESL are so advanced technologically that even the Japanese visit them to see how things are done, how remarkable it would be if at that time the Government said, "This is the point at which we pull the plug, destroy all that has been achieved, and thank and reward those who have made these substantial efforts by telling them that their industry is no longer required."
  How ironic it would be if that step were taken, after such a difficult decade, just when for the first time there is a glimmer of a possibility—some would say a likelihood—of an upturn in world demand. The evidence is there in the fact that the proportion of laid-up shipping is at its lowest level for 10 years, now just 4 per cent. of the world fleet. The evidence is also there in the fact that the price of secondhand ships has doubled in the last year and that the price being fetched for new ships has also risen substantially. How ironic it would be if this were the time that the Government, for ideological reasons, were to decide to wield the axe and chop our industry down just when it is poised to take advantage of the upturn in world demand.
  How ridiculous it would be if a great maritime and trading nation, which, despite the Government's worst efforts, still accounts for 8 per cent. of world trade, were unable to take advantage of improved circumstances. At one time, this nation built half the world's shipping output; 30 years ago it built more than a quarter of the output; now it builds only 1·5 per cent. of total output. How ludicrous it would be if we no longer had any merchant shipbuilding capacity. We would be dependent
  1118
  on foreigners who had had more faith in their shipbuilding industries and who had understood the commercial, strategic and industrial advantages of retaining that capacity.
  Mr. David Porter: Will the hon. Gentleman confirm that in his last statement he ignored completely the private sector shipbuilding yards and concentrated totally on the nationalised industry?
  Mr. Gould: As the motion makes clear, I am concentrating on merchant shipbuilding. That is the element of the industry which we believe is strategically important.
  Sometimes the Chancellor of the Duchy and his ministerial colleague disagree with me on the meaning of "strategic". Sometimes they argue that "strategic" has a solely military connotation. Let us accept that its military connotation is strong. I have had calls today from naval architects and specialists who said that, unless we maintained the capacity to build merchant ships, not just in the mixed yards but in the specialist merchant shipbuilding yards which could undertake the range required, we would be incapable of mounting any sustained naval operation, particularly of the sort which we saw at the time of the Falklands war. All the experts agree that without that capacity, we would be unable to mount a Falklands operation again.
  The Chancellor of the Duchy of Lancaster and Minister of Trade and Industry (Mr. Kenneth Clarke): If all merchant shipbuilding went, that would be right. But does the hon. Gentleman recall that he started his speech in a statesmanlike manner by claiming that he would do nothing to raise fears and spread rumours? He is now working himself up to a peroration in which he accuses the Government of being about to close down our entire merchant shipbuilding industry for ideological reasons, a statement for which he has no basis of fact. He is making that accusation against a Government who have so far put £1·8 billion into supporting the losses of British Shipbuilders. Does he not think that he is trying to raise fears in shipbuilding towns purely for political purposes?
  Mr. Gould: Nothing would please me, my hon. Friends and the hundreds of shipyard workers who have come to London today to lobby for their industry today more than if the Chancellor were able in two or three minutes to give us the answers to the questions which we have posed and to give us the commitment which we seek to the future of British merchant shipbuilding. He will have every opportunity to convince us of his good intentions and good faith in these matters. I hope that he will, but on the basis of what he has told the House and what he has said outside, I am sorry to say that there is room for grave doubt and real fear about what the Government have in mind for this essential industry.
  It is not just the strategic importance of the industry which matters; it is the impact on the local and regional economy if the NESL yards were to be lost. No doubt my hon. Friends from Sunderland and elsewhere will make that point. It is not just shipbuilding which would be affected. Other industries in marine engineering depend on shipbuilding for their survival. I think of enterprises such as Clark Kincaid, which is making engines for the ships

  1119
  being built in the Govan yard. My hon. Friend the Member for Greenock and Port Glasgow will have something to say about that.
  The ramifications of the Government's decision are important; on that I think the Chancellor of the Duchy and I agree. We now provide him with an opportunity to give us the assurances on Govan, Appledore and North East Shipbuilders, and to tell us the truth and what the Government intend to do. We expect answers to those questions. We expect the right hon. and learned Gentleman to make clear his commitment to this vital industry. Nothing less will do.
  4.47 pm
  The Chancellor of the Duchy of Lancaster and Minister of Trade and Industry (Mr. Kenneth Clarke): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
  'recognises the support that Her Majesty's Government has given to the shipbuilding industry; and welcomes the prospect of returning British Shipbuilders' yards to the private sector.'.
  I came to the House on 18 April to give hon. Members the earliest possible information about two items of news that were of great importance to shipbuilding areas. The first was that British Shipbuilders had received approaches—unsolicited approaches which the Government did not know were coming—for the disposal and sale of two yards, Govan on the Clyde and Appledore in Devon. I made it clear that we would welcome further interest from people wishing to take over business in all the corporation's facilities. I also told the House of the contractual difficulties that had arisen at North East Shipbuilders Ltd. in Sunderland. Those difficulties were already known to the work force and were about to become public, and it was important that the House should be aware of them.
  I made that statement to the House because I and the Government realise the importance of shipbuilding yards to the communities in which they are sited. We are all concerned about the prospects for the local economy in Clydeside, Wearside, north Devon and other parts of the country. As my hon. Friend the Member for Waveney (Mr. Porter) said, there are other yards as well. What we are talking about is how best to sustain economic activity, including shipyards if possible, and employment in all those places.
  We need to take advantage of the opportunity to look to the future of the economy in all those places and to keep up to date everyone who is understandably concerned about the facts, so that everyone may know where we are. I am not sure that this early debate, or the approach of Opposition Members on the Front and Back Benches, is altogether helpful. It is all very well for the hon. Member for Dagenham (Mr. Gould) to say that he wishes to do nothing to raise doubt and rumour, but he concluded by constructing an argument that contained the proposition that some deliberate attempt is being made to close down the yard. That hardly reassures the worried people in Glasgow, Sunderland or anywhere else.
  I have had similar experience elsewhere. I have had several meetings with the hon. Member for Sunderland, North (Mr. Clay). I mention him only because I see him in his place, as I would expect during such a debate. I have tried to be helpful and forthcoming when I have spoken to him, although sometimes I have had to be reserved to avoid jeopardising negotiations on the Clyde and
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  elsewhere. His way of recounting to local newspapers what I have said seems aimed more at local politics than at helping the situation.
  There is an important lobby today of people from the shipbuilding towns who are concerned about future employment levels in those towns. They have lobbied today largely because of speeches such as we have just heard, which have made people increasingly worried about where we are going. We ought to provide some answers. I shall certainly attempt to explain clearly where we are.
  Mr. Bruce Millan: Show us where we are.
  Mr. Clarke: The Opposition's explanation of where we are is hopelessly political. The hon. Member for Dagenham was listened to with care. The Opposition are now confirming my feeling that their concern is to create a row, rather than to discuss the issue sensibly.
  The hon. Member for Dagenham, in describing what had happened, said that the Government had created the situation. The two things that I have mentioned, the Kvaerner bid for Govan, and the difficulties over the contract at Sunderland, are nothing to do with the Government. We did absolutely nothing to provoke them. The hon. Gentleman did not mention the underlying difficulty that has to be understood when considering shipbuildin—where are the orders coming from, and where is the work coming from? It is astonishing that he made a speech about the history of shipbuilding over the last 10 years. He dealt with the past at great length, without mentioning the slight difficulty that at the moment there are no orders from anybody who wishes to buy ships beyond the existing work on the Clyde.
  The problem is getting orders. The existing work in Govan is for China, and in Sunderland it is for the Danish ferries. We are looking beyond that. We are talking about the future. It is absurd to say that the Government have caused all the problems. We just do not know where the next orders are likely to come from or at what price. Like most shipyards around the world, we are trying to cope with that.
  Mr. Gould rose—
  Mr. Clarke: I shall give way just once. I do not wish to give way to the Labour party before I have really got under way.
  Mr. Gould: The Chancellor is right to say that winning orders is a problem. We accept that. Does he accept that one essential condition for winning orders is the assurance that the Government intend to maintain a viable British merchant shipping industry? Will he now take the opportunity to assure the House that that is the Government's intention and that they will provide all the support required to achieve that objective?
  Mr. Clarke: The prospects of having a viable shipbuilding industry, which we all would like to see, remain extremely uncertain because of the condition of world markets. Having listened to the hon. Gentleman's speech, one would not believe that the Government have committed substantial sums to intervention fund support, and more to British Shipbuilders' yards. The bulk of the money that has gone to British Shipbuilders has been invested during the lifetime of this Government a total of £1·8 billion of taxpayers' money has gone into a business

  1121
  that now employs 6,500 people. It is absurd for the hon. Gentleman to try to make use of today's debate to say that somehow we have shown a lack of commitment to the industry during these difficult times.
  Mr. Heffer rose—
  Mr. James Wallace rose—
  Mr. Clarke: Let me take the factual basis a little further, as I have been pressed to do.
  I made the announcement on 18 April, and as a result there has been a great deal of interest from people making approaches for a variety of the yards. It is quite right that I am asked to bring the House up to date. The news about Govan and Appledore has brought two main responses. There has been a wealth of inquiries from the private sector about the corporation's yards. Obviously we welcome those inquiries, as we welcome the prospect of returning the yards to the private sector if they have a future there.
  I announced Kvaerner's letter of intent on 18 April. I am glad to say that talks have continued to go well. Not only is Kvaerner engaged in detailed negotiations with British Shipbuilders—which it would not be right for me to relate because difficult negotiations have to be concluded if we are to reach a successful solution—but it has had a very useful first meeting with the work force.
  I listened to what the hon. Gentleman said about the possibility of a sale to Kvaerner. I think that I judged him correctly when I thought he would not oppose the sale to Kvaerner. I do not think that the local work force will drive away the approach from Kvaerner. I think that they welcome it, and I commend all those in Glasgow who are taking a responsible and realistic attitude.
  More talks are planned for next week between British Shipbuilders and Kvaerner. I cannot anticipate where they will go, but I can point out to the House that not only has Kvaerner made it clear that it would contemplate placing two orders for gas-carrying ships in the yard—and there must be hopes of more orders—but that it wants to make west Scotland the centre of its gas technology business. If that were to happen, there would be prospects for many more jobs on the Clyde.
  I am still being asked why we have to sell to Kvaerner and why we cannot simply take the orders. I have tried to explain this before, and I do not know whether Opposition Members have tried to raise that question with Kvaerner. Kvaerner is well established and has considerable expertise in this niche market—not all of it in shipping. Its gas technology business extends beyond shipping. It has recently been placing orders on licence around the world on a price basis. Its business intention is to acquire a yard and find a new base, and I think that we all should be hoping that negotiations will reach a successful conclusion so that that very important base is established on the Clyde.
  The future for Govan and for what was Upper Clyde lies best in the conclusion of such negotiations. If it does not happen with Kvaerner, we would be interested in anyone else who offered a reasonable prospect for the area. As things stand, Govan is completing two ships for China. Nobody knows what it will do beyond that as a nationalised yard. It is all very well for the hon. Gentleman to read declarations about his ideological commitment to
  1122
  the future of British shipbuilding, but he did not say a word about what it will build in Govan and what will happen when the Chinese ships are completed and the work force in Govan starts being laid off if there is no movement towards the Kvaerner sale to which I have referred.
  We have received several written expressions of interest in Appledore. It depends on how seriously one takes them—some are more serious than others—but there have been a number of inquiries about the purchase of the Appledore yard. Some are interested in Appledore, some are interested in Ferguson and some are interested in Appledore and Ferguson as an entity. Negotiations have yet to get very far, but the interest, especially in Appledore, is very strong. I do not want to raise excessive hopes, but I am optimistic about a successful conclusion.
  British Shipbuilders has businesses beyond merchant shipbuilding. Its engine building facility at Greenock, Clark Kincaid, builds large diesel engines for use at sea and in land-based power generation. We have received four expressions of interest in the acquisition of Clark Kincaid, including one from the management team, and negotiations for the sale of that shipyard have begun.
  Finally, British Shipbuilders has a design and computer service business, Marine Design Consultants, which is based in Sunderland and in Dundee. MDC has attracted a particularly high level of interest. Again, I do not take all expressions of interest as commitment, but I have received a huge list of people who have expressed some interest, and I am confident that it will successfully be returned to the private sector, where it can broaden the range of its work.
  I accept that there are questions about the future of British Shipbuilders because a number of the yards are now the subject of negotiations between British Shipbuilders and companies which have a serious continuing interest in maintaining them in business and maintaining a level of employment. On balance, that is good news. In fact, the approach from the Norwegians has reminded people at home and abroad of the Government's preparedness to dispose of the yards to those interested in acquiring them as a business. That has produced good news for Clydeside, north Devon and elsewhere.
  I was asked about Harland and Wolff. I cannot go into that because it is the responsibility of my right hon. Friend the Secretary of State for Northern Ireland. The hon. Member for Dagenham spoke about an order, or about the campaigning that is taking place because of the interest of Mr. Ravi Tikkoo in buying a large cruise ship. That is a matter for my right hon. Friend the Secretary of State for Northern Ireland. I do not believe that at present he has any indication of the cost or the level of support required. I am sure that everybody in Northern Ireland, including the taxpayer, would be interested in receiving those details and evaluating them as early as possible.
  Mr. Elliot Morley: I want to draw the Minister's attention to what people are looking for in the order at Harland and Wolff. They want some enthusiasm and support from the Government. I accept the right hon. and learned Gentleman's point that the details are not known, but for many constituencies such as mine, which produces steel plate, and for firms such as CMR Electronics, which has submitted a major tender for the order, it will have great benefits.
  Mr. Clarke: I am astonished if tenders are being submitted. It is not for me to answer on behalf of my right hon. Friend the Secretary of State for Northern Ireland, but my understanding is that the Government do not yet have estimates of cost, support or anything of that sort. If there is enthusiasm for the order, the sooner we move away from everybody being told through the newspapers about what an attractive proposition it is, and the sooner we get down to costs and estimates of how much the taxpayer is expected to contribute, the better it will be and the more likely we are to make progress. I can see that I am being drawn into a Northern Ireland debate. I touched on Harland and Wolff simply out of courtesy in response to the hon. Member for Dagenham.
  The Government are explaining as carefully as we can where we stand with the yards in England. There is a good future in prospect for the bulk of the yards where there is interest in purchasing them, and we cannot be accused of a lack of commitment or of shirking our responsibilities. I shall repeat for the last time the figure of £1,800 million for 6,500 workers still employed. Last year, each job in British Shipbuilders cost the taxpayer nearly £20,000 to sustain through the support for the orders we had acquired and the subsidy for the losses that the yard was making over and above the intervention fund support. That is a commitment to one part of merchant shipping.
  To return to the point made by my hon. Friend the Member for Waveney, we should not proceed with this debate on the basis that British Shipbuilders makes up the bulk of shipbuilding in this country. That is not readily appreciated by people away from the shipbuilding areas. British Shipbuilders, the nationalised industry, employs 6,500 people. In Britain—I shall leave Northern Ireland out of my figures for a moment—26,000 people are working in other yards. The total number of shipbuilding jobs in Britain is 32,500. Our £1,800 million has been used to sustain the jobs of 6,500 out of that total. That certainly means that we cannot be accused of a lack of commitment. There is no point in saying, as the Opposition seem to imply, that the only policy is to continue to throw money of that scale at the problem, particularly when they do not address themselves to the question of what they will do about new orders.
  Intervention fund support has not been the major cost of British Shipbuilders. The amount of intervention fund support—the subsidy that Europeans give for orders—has amounted during our period of office to about £250 million. The rest, over £1·4 billion, has largely been spent in supporting the losses over and above the intervention fund support, and in supporting spare capacity costs when there were no new orders to cover those overheads. Every time we have taken an order the Government have given a 28 per cent. level of support. That has happened every time there has been an order from China, Denmark or wherever. The history of British Shipbuilders is that, on top of the intervention fund support, it has lost an average of about 20 per cent. more on the contract with cost overruns and delays before the ships are delivered.
  The respective sales will result in new management and, in the case of Kvaerner, new forms of business. There will be people who believe that they can turn those chronically loss-making yards, some of which have been limping along in recent years, into businesses with a real future that can be put on to a commercial footing. That has to be better for the work force and for the communities that depend upon them.
  Mr. Wallace: The right hon. and learned Gentleman has mentioned orders on several occasions. Is he aware that the Orkney Islands council wants to place six orders for new vessels in the near future? It found that when it wished to place an order with a British shipbuilding firm the intervention fund assistance would not necessarily be forthcoming, and it has been compelled to look abroad, where it has found that our foreign competitors are being subsidised, including one country where the subsidy will be increased threefold. How does the Minister think that that policy will help British shipbuilding?
  Mr. Clarke: Intervention fund support has never been available for all yards in the United Kingdom, and most people have agreed with that. If one starts extending intervention fund support to yards that are not traditionally merchant shipbuilding yards, one simply increases the problems of excess capacity. The mood of Opposition Members on this occasion seems to be that the details of the Orkney contract would be better pursued on some other occasion.
  Mr. Michael Grylls: Are not the figures that my right hon. and learned Friend has given of four times as many people working in firms that have been returned to the private sector a vindication of the Government's policy of returning the yards to the private sector step by step? Will my right hon. and learned Friend take encouragement and move further in the way in which he is describing? The record of the Northern Ireland Office in backing winners is not very high. I hope that it will pause before it puts more money into another dream project.
  Mr. Clarke: On the first point, some of the privatised yards have been hugely successful and are doing better now than would have been the case had they remained nationalised. On the second point, I am sure that my right hon. Friend the Secretary of State for Northern Ireland would not dream of putting before the House any proposition for public support for a major industrial order that was not well-judged, based on costs and a serious assessment of what it would be likely to cost the taxpayer. That is a matter for my right hon. Friend, not for me.
  I want to deal with the last point raised by the hon. Member for Dagenham, when he said that I must reaffirm the Government's commitment to the industry and so on. Nobody can quibble about our record of support for British Shipbuilders, and we shall continue to fund the corporation. We have laid an order before the House to raise the corporation's borrowing limit yet again. This will be debated in the near future on the Floor of the House. I made it clear that I no longer expect dividends to be proposed by or required of the corporation in respect of further payments of public dividend capital. Just to prove my point on the current stewardship of the Government, we shall be paying a further £24 million to the corporation this week.
  I shall move on to talk about the problems at North East Shipbuilders Ltd., the problems of the orders that we have and the contractual difficulties. Hon. Members on both sides of the Chamber are concerned about the state of the ferry programme at North East Shipbuilders, and I am sure that that is why many people from the north-east have come here today. We all know that there has been a dispute between British Shipbuilders and its Danish customer. I cannot intervene in that. My hope is that the

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  dispute will be resolved. British Shipbuilders strongly denies any suggestion that the ferries are inadequate, or that there are defects in them. Counter-allegations are being made by the customer. We hope that the dispute will be resolved and that the contract will continue.
  That contract is heavily supported by the Government. A total of £1 million-worth of intervention fund support is going into every ferry built. The contract price to Mr. Johansen is £4 million. The intervention fund support does not include the soft loans, and so on, which have also gone in to help this order, which is potentially for 24 ferries. At the moment the customer is in default on a number of the contracts, with the result that only two ferries have been delivered, and, as anybody who goes to Wearside is, unfortunately, able to see, there is a growing row of fine ferries moored there. In the opinion of British Shipbuilders these are potentially available for other customers. I think that there are seven ferries now on the river.
  We are still waiting for negotiations, and I do not believe that it would be helpful for me to go into a blow-by-blow account of where the parties think they are at the moment. I accept that there has to be some doubt about whether the programme will be completed, but for the time being it is continuing. For so long as it is continuing, for so long as the ECGD has not declared the customer to be in default under his loans, and for so long as neither party has declared any intention of shortening the contract, we proceed with laying the keels and the customer keeps being declared in default under the contract. Everybody is hoping that this matter can be sorted out satisfactorily but, with the possibility of the programme not being completed, we are looking to the possible future in Sunderland.
  Everybody accepts that any termination of orders in Sunderland would be a great blow to the local economy. Only as events unfold will we know whether Sunderland's future lies in continued support for the Danish ferries or any other kind of order or in looking for other, alternatives ways of stimulating employment in the town.
  There will be talk of Cuban orders. I do not believe that the Cubans have any intention of taking the ferries, which are of a particular design intended for the Scandinavian waters. The hon. Member for Sunderland, North is always talking to me about the Cuban order, and the Cubans do, indeed, appear to be contemplating the possibility of building freighters, but no proposition has yet come in. Remembering the history of orders of this kind over the years—Polish ships, Chinese ships—we must look very carefully at these orders. The purchaser is very heavily subsidised, so one has to look very carefully at the financial basis of what is proposed.
  We are making it clear to all prospective purchasers of British Shipbuilders' yards that we will discuss with them support for new orders and the basis upon which we might contemplate continued support of an intervention fund kind for the future. I should be inclined to consider requests for support from British Shipbuilders with considerable care, if not scepticism, in the light of the very heavy losses over and above the intervention support that British Shipbuilders has consistently made in the past.
  People from Sunderland obviously want to know what the immediate outlook is. At the moment we have this contract under negotiation. First, it is a small source of
  1126
  comfort, but very relevant, that no scenario—if I may use that awful word—that can be contemplated for the outcome of the Danish ferry dispute means that the yard will close tomorrow, or anything like it. There are months of work that is bound to continue, including work in hand, contractual obligations, and so on. We are not facing a disaster that will lead to an overnight shutdown. Secondly, other things are happening in Sunderland. The Government have helped Nissan cars to go into Washington new town, and there is the potential for a huge amount of extra employment there in the early 1990s.
  In any event, unemployment is falling rapidly in Sunderland. This morning's news is extremely good. Unemployment in Sunderland has fallen by 4,500 over the last 11 months. Unemployment in the Sunderland travel-to-work area has fallen faster than the average for the northern region as a whole, where unemployment has fallen faster than in any other region of the country except the west midlands.
  We are not talking about a no-hope town. We are talking about a town in which the economy is coming back very strongly. I fully expect that the hon. Members for Sunderland, North and for Sunderland, South (Mr. Mullin) will get up and say that everything is dreadful in Sunderland. I do not think that they do their town a service, because it is engaged in a great revival of activity and they should be lobbying me about the shortage of factory space for people who want to invest in alternative employment.
  Things have moved a little since my last statement, but I believe that the Opposition have rushed too soon into this debate. Negotiations are continuing with Kvaerner. There are more potential customers who wish to acquire other yards—Appledore, Ferguson, and so on—with a continuing interest. The dispute over the Danish ferries is not resolved yet, but work is continuing and there is no imminent threat of all work coming to an end.
  We are not talking about the end of British shipbuilding. We have had all this talk about a strategic industry and how a great maritime nation can go forward without a shipbuilding capacity. The great bulk of the industry is outside British Shipbuilders' merchant yards. We retain a great shipbuilding capacity for purposes of war or other purposes. British Shipbuilders' warship yards are already there and we have the private sector merchant yards that were never nationalised. Their employment may be modest in total, but it now approaches one sixth of that of British Shipbuilders.
  I am pleased to say that there is a substantial amount of work in progress on warship building. Vickers and Cammell Laird have submarine programmes stretching well into the 1990s. Swan Hunter has two type 22 frigates and one type 23, and a second auxiliary oiler replenishment vessel under construction. Yarrow has one type 22 and three type 23 frigates. Vosper Thornycroft has work on smaller vessels until 1993.
  There are good prospects of a substantial amount of new work in the shape of further type 23 frigate orders. Four companies have already tendered: Swan Hunter, Vickers, Vosper Thornycroft and Yarrow. We cannot say at this stage how many frigates will be ordered and when, but they are very important prospects. All these companies are thriving. They are the companies that the hon. Member for Dagenham was dismissing a few moments ago as failed companies in the private sector. As my hon.

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  Friend the Member for Surrey, North-West (Mr. Grylls) pointed out they are all extremely successful warship builders.
  Warship builders can and do build merchant ships as well, although they do not get intervention fund support to do so. Swan Hunter is building a cable ship at the moment. Hall Russell is building a replacement vessel for St. Helens. The small private yards that I mentioned are building a range of vessels, including tugs and fishing boats. Further orders have been announced for, among other things, chemical tankers, a ferry and vessels for the Ministry of Defence. All that is shipbuilding. The Government are not in any way indifferent to the fate of shipbuilding in this country. Large sections of the shipbuilding industry are doing well and quite a number of the British Shipbuilders yards that we are talking about this afternoon are likely to do well if they go into the hands of companies such as Kvaerner and get into specialist markets in the future.
  I do not for a moment deny that we are at a somewhat difficult crossroads with British Shipbuilders with the news that I have had to report on different yards where events vary from case to case. There is a limit to the information that I can give until negotiations and disputes have been resolved.
  Having put in all this money to sustain the industry through a difficult time, the Government are looking to the future of the yards and the economy on Wearside and Clydeside, at where the modern jobs, the next jobs, are to come from and at the continuing, and we hope rising, employment in those towns. That is what matters most of all. I hope that the future will include shipbuilding in most of, if not all, the places with which we are primarily concerned today. We cannot be faulted for the support that we have given to shipbuilding in the past, or that we are giving to it now, which is generous to excess compared to any other industry in the country.
  We shall continue to handle the problems of Govan, NESL, Ferguson and Clark Kincaid on the same pragmatic basis, case by case, and try to reach a successful conclusion. We shall handle them in a sensitive fashion, but we are not helped by the Opposition seeing the prospect of fanning a few fears and winning a few quick political points, and spreading a few unjustified rumours in the hope that they will get some advantage out of the present changing situation in the British shipbuilding world.
  5.19 pm
  Mr. Ted Garrett: It is 25 years since I made my first speech in the House on shipbuilding. Since then I have seen the nationalisation and denationalisation of the industry and served on the Committee that examined the relevant Bill in long and controversial proceedings.
  I am cautious when it comes to predicting the total demise of the British shipbuilding industry. There are historical reasons for its present position and we should not spend much time in this short debate analysing them. We should look not backwards, but forwards to what is likely to happen.
  I am pleased that the Minister mentioned Swan Hunter which is in my constituency. It was nationalised and then denationalised. When it was nationalised it spent some of the money given to it in the form of subsidy on modernising the yard and making it more efficient. The
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  benefits of increasing its efficiency and of modernisation have been seen since it was denationalised, so the money was not wasted.
  In the past two years the Swan Hunter group has made tremendous improvements in its efficiency and in cost reduction. Overheads have fallen by over 30 per cent. and productivity has improved by 25 per cent. Those are good, aggressive moves to keep the company in international shipbuilding. In some ways the taxpayer is now beginning to receive value for money.
  The shipbuilding industry is now tightening up and making more aggressive its purchasing from local suppliers and from British industry in general. That had to come. In the past, the industry was rather slothful; it did not shop around widely enough to make its sub-contractors keen and competitive.
  Recently, the result of this efficiency was shown when HMS Sheffield was handed over to the Ministry of Defence ahead of time. We should give credit for that to the shipbuilding workers and management on Tyneside. The ship was handed over with no defects or work outstanding, and the captain expressed complete satisfaction with his mastery of the ship. Such news was well received in the district, but not in the national press, in which one never hears about the good side of the business. All the national press ever does is knock the shipbuilding industry, and that has had an effect on morale.
  Some companies are beginning to fight their way out of this position and adopt a more positive attitude. But I warn the Minister that this progress towards efficiency by companies such as Swan Hunter can be maintained only against a background of continuing work. Unless that is guaranteed, companies will have to make substantial cuts in their work forces. We are nearing the threshold of further cuts because of reductions in the volume of work.
  The mix at Swan Hunter's yard should serve as an example to others. It consists of Ministry of Defence and merchant contracts. The company has tightened up its marketing, and its maintenance of overseas sales drives has brought an order from Ghana and a possible order from India. Above all, the company has won a substantial order, worth £40 million from Cable and Wireless, in the teeth of intense competition. Cable and Wireless did not hand over the contract—it had to be fought for.
  The Government's philosophy of a hands-off approach to massive subsidy will have to change. A time is coming when we shall have to put in some money for social reasons. The company will need a social input of cash to maintain the initiative and incentive that it is now developing. It will need that to remain in the international market and as a large contractor for the Ministry of Defence.
  We hope that when the contracts for the four frigates are announced, Tyneside will get a substantial share of the work. If it is successful, it will be based on a completely costed contract. The Ministry of Defence wants value for money, and it will get that from companies such as Swan Hunter.
  The Conservative party's blind spot—it was evident in the Minister's speech—relates to the £20,000 per job that the British shipbuilding sector costs. How does that square with the amount it costs to keep a British farmer in a job? If we had that figure we would have a reasonable basis for comparison.
  Mr. Philip Oppenheim: It costs £3,500 a year.
  Mr. Garrett: I am not opposed to subsidies to the farming industry if they are kept within reason, but the Conservative party is usually silent about subsidies to British farmers—
  Mr. Oppenheim rose—
  Mr. Garrett: I have nearly finished.
  The Conservatives create mayhem about the costs of subsidising shipbuilding. I am not stupid enough to think that every shipbuilding yard should remain open if that is impossible for various reasons. My hon. Friend the Member for Sunderland, North (Mr. Clay) will, I am sure, have his say about this later. Sometimes, for social reasons, a shipyard should be kept open in the short term until work comes along, and it will, because of the efficiency measures that management is introducing and because the work force realises that do-or-die efforts lie ahead.
  I conclude by asking the Minister—who, I know, will not budge if I mention massive subsidies—to bear in mind in future discussions in Cabinet and with senior colleagues that there is a case for a short social fund payment to tide British shipbuilding over until orders are obtained. If he will give some sign that he thinks there is merit in my point of view, I shall be satisfied.
  5.28 pm
  Mr. Barry Porter: I hope the hon. Member for Wallsend (Mr. Garrett) will forgive me for not following his argument about the north-east. As always, his speech was reasonable, save in one respect. From listening to him and the hon. Member for Dagenham (Mr. Gould), one would think that the Government had been wholly indifferent to the fate of British shipbuilding over the past nine years. I hate to repeat the figures—repetition is a form of flattery; but perhaps this is meant to be that—but the Government have spent £1·8 billion in that period to ensure that the industry is supported in one way or another. That is not indifference.
  Mr. Gould: As the figure of £1·8 billion has been cited so frequently, it is perhaps worth making it clear that a substantial proportion of that money went to the much touted privatised yards, and another large proportion has gone on the costs of restructuring and redundancies in British Shipbuilders. The money has not gone entirely to British Shipbuilders' present operations.
  Mr. Porter: A large proportion of it was used to pay for some restructuring in the industry, and it is right that that was done. Whatever way one looks at it, a substantial tranche of public money has gone to the British shipbuilding industry; that cannot be gainsaid.
  I shall speak about my own area. My earliest memory of the shipbuilding industry was watching the launch of the Ark Royal in about 1950–51, when Cammell Laird employed about 20,000 people and was the hub of the town in which I was born. [Interruption.] This was a bigger and better one. It was difficult for me to watch the decline of a town that depended upon shipbuilding and had its heart in the shipyard. I still live in that town and I am pleased to see in the Chamber listening to my speech the hon. Member for Birkenhead (Mr. Field).
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  The hon. Member for Dagenham concentrated on the problems of merchant shipbuilding, but problems also exist in the warship market. They are not as critical as those in the merchant sector, but there is very keen competition between the yards. The hon. Member seemed to ignore the obvious reason for that, excess capacity, and to hope that it would go away. It is obvious that a yard such as Cammell Laird depends greatly on the Ministry of Defence and on the Government's warship procurement programme.
  I was delighted to hear my right hon. and learned Friend the Minister say that an order for another four type 23 frigates will be placed some time this year. I trust that the orders will be placed sensibly and that their placing will be based upon the philosophy that underlay the privatisation of the warship yards.
  I do not want to give the House a long and detailed history of the problems of Cammell Laird. I am sorry to see that the hon. Member for Liverpool, Walton (Mr. Heffer) is not here, because many years ago he worked, no doubt expertly, as a joiner with Cammell Laird. By 1984 Cammell Laird was nearly on its knees. Nobody cared or worked very much, and that was part of the Merseyside malaise. The yard had no future and was making a loss. There was a politically and industrially motivated sit-in, and without doubt the yard was within a week or so of being shut. With the help of some hon. Members from the area, about 1,250 shipyard workers walked past the pickets. They passed the jeering bully boys, and that was a significant turning point for the town and for Merseyside. The realism shown by the work force was an important British industrial landmark and ensured the survival of the yard.
  I hope that I shall not destroy the political career of the hon. Member for Birkenhead any more than I have already done by paying tribute to him for his realistic response at that time. It was realism that obtained the order for the first frigate. The first and second frigates were delivered on time and in good order, and I have no doubt that when we get an order for a third frigate it will also be delivered on time and in good order.
  The thrust of my argument is that Cammell Laird went along with the Government's policy of privatisation. It accepted that the Government had the right to do that, and it made itself efficient. It has now increased its work force from its low point of about 1,200 or 1,300 to about 2,000. That is significant. It would be wrong if that yard, having gone through that change, did not get orders. It does not expect them through saying that it is wonderful and marvellous and that it is Cammell Laird's turn. Similarly, it would be quite wrong if other yards got orders on the basis that it was Buggins's turn. The Buggins philosophy is purposeless.
  Yards such as Cammell Laird, which have proved their efficiency and shown that they can build these ships, should be given orders on the basis of efficiency, cost and quality. If that does not happen, the whole privatisation programme will make no sense at all. Buggins must not have his turn. On the basis of efficiency, Cammell Laird must have the orders that it deserves. I am quite certain that hon. Members with constituencies on the Wirral peninsula as a whole, and in Birkenhead in particular, will do everything in their power to ensure that Cammell Laird gets what it deserves.
  5.35 pm
  Mrs. Ray Michie: I have some justification for being happy to take part in the debate, because I have a shipyard in my constituency. It builds excellent fishing vessels and is a very thrusting and enterprising yard. However, that is not the type of yard that we are discussing.
  All previous speakers have highlighted the fact that, certainly in terms of production, British shipbuilding is a sad story of decline. The over-capacity in the world's shipping industry has led to a chronic dearth of orders for new ships. It is clear that world production capacity far exceeds future demand in the medium and long term. The fall has not been uniform. In the European Community, for example, the reduction has been about 45 per cent. In Japan, which is the world's main producer, production has fallen by about one third, whereas in eastern Europe it has remained stable. Korea, which is a relative newcomer to shipbuilding, now produces about 15 to 20 per cent. of the world's ships, but the United Kingdom's share has fallen to 2 per cent.
  We know that nearly every shipbuilding nation subsidises its shipbuilders, either directly or indirectly. The Minister made much of the support given by the Government. I wonder if he will give some reply to the European Community Council's sixth directive on shipbuilding, which took effect from the beginning of 1987. As I understand it, the Council agreed that the aid ceiling should be set at 20 per cent. for smaller ships costing less than approximately £4·2 million.
  The Government decided that the full value of the permitted aid ceiling should not be applied to ships costing £10 million or less to build. Instead, they applied a sliding ceiling under which the amount of assistance available is set at a maximum of 20 per cent. for a £10 million ship, reducing on a straight line basis by 0·75 per cent. for each £1 million drop in shipbuilding cost.
  I hope that the Minister will tell us why the Government have cut this level of aid, thus damaging our yards in their efforts to win new orders. It is extraordinary that the Government, having concluded a Community agreement on the level of aid permitted, should then refuse to take full advantage of that agreement.
  The decline goes on. It was said in the merchant shipping debate and it should be said again that in 1975 there were over 1,600 British ships. Now we have less than 650. Of course our fleet, like others, has been subject to changing world trade patterns and to innovations such as containerisation. The Government's 1984 Budget which removed incentives to capital investment in shipping was a great blow. I shall speak briefly about Govan.
  Dr. Norman A. Godman: I hope that the hon. Lady will be brief.
  Mrs. Michie: I want to say something about Govan because, like the hon. Member for Greenock and Port Glasgow (Dr. Godman), I come from Scotland.
  The Government intend to sell off the Govan shipyard to the Norwegian firm. Any additional work and the potential for future orders is to be welcomed, but I do not think we have been told about guarantees that the Norwegians will not just build these ships and then walk away. What hopes are there for more orders? The Minister said in his original statement that the company would be making conditions, but I do not think that he said
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  anything about the Government asking for guarantees for workers or orders. I still do not understand—I ask the Minister again—why the Govan shipyard does not build ships for the Norwegian company. It has the expertise. Are we saying that we could not do it? Alternatively, is there not the possibility of a joint venture or the formation of a partnership?
  Hon. Members have referred briefly to Harland and Wolff and the Yarrow shipyard, and to the hope that the type 24 frigates will go there. But the lack of civilian orders is crucial for our yards. We understand that British Shipbuilders—I believe this is true—would prefer to order in our yards, provided that they can compete on price and delivery, and great strides have been made in this direction. It is much more costly for a British company to spend time and money to send someone to Taiwan or Korea than to send him up to have a look at a ship in Govan. I believe that our companies want to build ships here.
  The truth is that shipping companies will order ships only if the rate of return on a massive capital investment is at least as good as other investments. Any lack of Government encouragement means that this money goes elsewhere, to the detriment of shipbuilders. We all accept that shipping operates in a very competitive environment. It is not regulated like the airlines. Foreign shipowners can buy cheaper ships because of aid from their Governments, whether by subsidised building, protective trade or assistance with crew costs, and the stark reality is that British owners will not buy ships.
  The Government policy means that British yards will not even be at the starting blocks to compete for work; that is bad for shipbuilding and repair, and bad for the national interest. Surely we should be supporting an industrial strategy instead of what seems to be a policy of sell, sell, sell.
  I want to draw attention again to the fluctuating exchange rates, which can do more to damage ship-building than almost anything else.
  We need a strong merchant fleet to carry our own trade and ensure control, as an island nation, of those vital lines. We need to send clear signals that we can reinforce and resupply our industry and population in times of tension or war. Have we reached the point where that can no longer be certain? It is increasingly clear that merchant shipping will dwindle further unless there is action now.
  We have been asked, "Where are the ships and the orders?" Here are the orders. The fleet is aging. Today's ships average 12 years old, and 48 per cent. of container ships are more than 15 years old, so the crucial time for investing in British ships is immediately ahead; indeed, it is now. The Government seem content to let the ships go, and with the ships what remains of the great contribution to engineering skills from the shipbuilding industry, especially in Scotland.
  We must take action now. The means are readily available. I heard the Chancellor of the Duchy of Lancaster say this morning on the radio that he wanted somebody to come forward with ideas. I have a list of ideas here, which I will send him rather than take the time of the House now.
  Many solutions are on offer in relation to crew costs and investment. The Government need to seize them, and to find the political will to look at the future of our island seafaring nation, and the shipbuilding skills and expertise

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  of our men, so that we have a merchant fleet of which we can be proud, which is British built and crewed by British merchant seamen.
  5.45 pm
  Mr. David Porter: I have been impressed since I came to the House last year by the golden opportunities missed by the Opposition in their choice of subject for Supply days and their treatment of them. I thought for a while that shipbuilding might be a different case, but I am relieved to hear that it is not.
  My hon. Friend and namesake, the Member for Wirral, South (Mr. Porter) stressed realism in his speech. Realism is missing from what the Opposition say, not just about the market place but, amazingly for the Labour party, about the shop floor.
  The hon. Member for Dagenham (Mr. Gould) who is no longer in his place, I am sorry to see, admitted that he was concerned only with the nationalised industries and yards. I have an independent yard in Waveney, Richards of Lowestoft, which was founded in 1876. It is a living, breathing, vibrant and private yard. I also have Brooke Yachts, which until recently was part of the internationally known Brooke Marine, the famous warship builders. I am concerned with Richards in this debate.
  The men on the shop floor at Richards know the reality—that shipowners go to the cheapest source of supply. There is no customer loyalty, as shipping is an international concern. They know it every day, because if they forget it for one minute they will be out of work. They also know that British Shipbuilders makes substantial losses, something which passed virtually without comment until recently. The shop floor workers do not understand why that should be, and neither do I.
  I was present when the Chancellor of the Duchy of Lancaster assured Richards last July that he would not allow British Shipbuilders' yards to carry on putting in loss-making bids, thereby damaging the private sector at the taxpayer's expense. I have had a letter from a private secretary in 10 Downing street since then to confirm that it is Government policy. The Government attach particular importance to BS only bidding for contracts in competition with United Kingdom private sector yards, provided that it does so on a realistic basis.
  I must ask a variant of the question posed by the hon. Member for Dagenham: do the Government want a small-yard, independent shipbuilding sector? The work force at Richards are incredulous sometimes at the speed of response from the "enterprise" Department. I raised with our noble Friend the Secretary of State for Trade and Industry the case of an application for two tank vessels submitted by Richards in March. It will go abroad unless something moves fairly quickly.
  The general point remains. When pressed, the official response from the Department is often on the lines that these applications for intervention fund support are being considered in the normal way. That is not, and should not be, good enough. Surely, of all the leviathans of the state, DTI should know that speed is of the essence.
  On the operation of the intervention fund, an impression persists sometimes in dialogue with officials of a slightly negative approach to using the assistance available in the manner for which it is intended.
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  Shipowners will not wait while shipyards and the Department, and the Commission in Europe, argue the toss about applications in a protracted way. Both sides need, not a long-awaited grace and favour decision but the offer of a firm amount, so that shipowners could decide their financial liability and shipbuilders quote a firm price. Our partners and competitors in other European countries have a certain amount of flexibility, which we once had. Let us have it back.
  Three or four years ago, these decisions were speedy; let us have that back, too, with the confidence in the IF system that the industry needs. I do not think that I can vouch for it at the moment. We have heard of orders tonight, such as for Danish ferries. Another was required by the Government of Mauritius. There was also the Ministry of Defence range mooring vessel order, which Richards finally won. All show in different ways that something is wrong with the present system.
  To defend my hon. Friends, I am aware that this is not entirely in their hands. We are dealing with an army of bureaucrats who have failed to solve the problem, many of them in Brussels and Strasbourg. We are dealing also with almost kamikaze survival tactics from Japan, Brazil and South Korea. It is a global problem. There is a dearth of new building orders. But, as the Opposition admit, there is a glimmer of hope and a definite increase in optimism about demand prospects.
  To be equally fair, some of the problems are inter-departmental. There is one skipper who would order at least two new trawlers to be built at Richards in Lowestoft but for problems with intervention and fishing licences. Interdepartmental, international or intercontinental—the noise made by the Opposition at any suggestion of subsidies being removed from British Shipbuilders is head-in-the-sand stuff.
  The hon. Member for Dagenham is quoted in Lloyd's List in April as saying that it is crazy for the United Kingdom to pull out of shipbuilding when the market is picking up and United Kingdom companies are returning to competitiveness. If he is talking about BS, that remark sticks in the throat, but he misses the point—that, with a vibrant private sector, the United Kingdom will not pull out of the world market.
  Shipbuilding may no longer be fashionable, but the updated private sector can offer places to graduates, craft apprentices and youth trainees. Surely that contributes to what we are all trying to achieve in respect of traditional attitudes, good behaviour and honest endeavour. The private sector must have an eye on dividends. In Richards's case, the parent company let it retain dividends while rationalising working practices. But where there is profit, there is substantial tax. How much tax has British Shipbuilders paid?
  5.51 pm
  Mr. Bob Clay: The hon. Member for Waveney (Mr. Porter) said that there is a glimmer of hope for an upturn in orders, "as the Opposition admit." We have trumpeted the fact that an upturn is coming and that there are orders to be secured. The difficulty is that the Government do not have the will to sustain the industry, to secure those orders and to continue to do so until the upturn comes. Once again, the Minister's speech was complacent, and I make no apology for saying that. As the right hon. and learned Gentleman acknowledged, the area

  1135
  which I represent faces—perhaps not overnight but certainly within months—closures and the loss of 3,000 jobs—with perhaps another 6,000 or 7,000 dependent on them—if the Danish ferry contract finishes and other orders are not secured.
  I make no apology for being appalled by the Minister's complacency and at the incompetent muddle of his speech. His speech was permeated by the idea that there was great enthusiasm for buying British Shipbuilders' yards. I do not understand why so many people want to buy Appledore, Govan, the Clark Kincaid engine works or Ferguson-Ailsa if there are not orders in Britain or elsewhere. Perhaps people may want to buy those yards for property speculation, which would be disgraceful. The Minister has not yet answered that point, which was made by my hon. Friend the Member for Dagenham (Mr. Gould).
  At stake are not just the thousands of jobs at NESL, but the pride of a community which at one time built and launched more than half the world's tonnage of ships, which has suffered tens of thousands of job losses since the Conservative party came to power and which now has its back to the wall, seeing perhaps the end of a tradition going back decades.
  For all that unemployment may be falling slightly, it is still 21 per cent. in the area as a whole. Because of tradition, history and many other factors, two thirds of the work force live within a mile of the yards on the river. There are pockets and estates where unemployment is still 30 or 35 per cent. There is no need for us to face this crisis. The Opposition have argued long enough.
  Korea and Japan subsidise their yards far more than the Government have been prepared to subsidise ours. Now our Government talk about "no further loss making." It is absurd. I am sure that the Minister has had placed in front of him by his civil servants—if they have any competence—figures showing the age profiles of the merchant fleets around the world. By the end of the 1990s, unless there is substantial new building, there will not be ships. They will have sunk, so old and unseaworthy is much of the merchant ship capacity. It is a question not whether there are orders and when they are coming—there will be an upturn—but whether the ships will be built in this country and whether they will be built in Sunderland—the point that concerns me.
  It was an insult to shipbuilding, and to Sunderland in particular, for the Minister to say, "If we cannot sustain shipbuilding, perhaps we should look at something else."
  As ever, Nissan was mentioned. We all know that we shall need another three Nissans just to replace the job losses if NESL closes. Shipbuilding is a high-tech industry. Does the Minister not understand that? The ships that NESL builds are among the most superb advanced ships in the world.
  I have a suggestion for the Minister. Around the country there are great big billboards, paid for by the Department of Trade and Industry, which show the heavy features of Sir John Harvey-Jones, the former chairman of ICI, who advises British business men to get ready for 1992. A few weeks ago, the same Sir John Harvey-Jones was in Sunderland for the radio programme "Down Your Way." He chose to go on one of those Danish super-flex ferries with John Lister, the chairman of the corporation. They had an interesting conversation about the superb technological advance that those ferries represented, how they were doing what had not been done before and what an advance in building they were.
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  As Sir John Harvey-Jones seems to have great enthusiasm for those ferries and as everyone in the town, the management and the work force stand by the standards of those ferries aid refute any accusation of bad workmanship in Sunderland, instead of taking a stand-off attitude of "wait and see", why does the Minister not ask Sir John Harvey-Jones with his great commercial and industrial experience, or someone of his ilk, to step in and, on behalf of the Department of Trade and Industry and British Shipbuilders, promote those ferries on which payments have been defaulted?
  The Minister should be able to say that we shall build all 24 and that, whether or not the Danes buy them, we shall find other purchasers. It is a disgrace, because the borough of Sunderland, which is hard-pressed with penalties, and threatened with rate capping, has done more to defend those ferries and to find purchasers than the Minister and the Department.
  Whatever happens with the Danish ferries, we must recognise that by the end of the year, even if the contract is completed—as we pray it will be—we shall be coming to the cyclical crisis of where the next order will come from. The Minister says that there are no orders. I have a suggestion. Yesterday, for the third time, a report was issued showing that roll-on/roll-off ferries—not the Danish ferries being built in Sunderland but those crossing the Channel and other seaways—are unsafe. The Royal Institution of Naval Architects has recommended that work be done on those ferries to make them seaworthy and safe. It is a disgrace that that has not been done already. That work could be done in British ship repair yards with Government grants, if necessary. That essential work, on which the Government should insist, would provide a good breathing space before more orders are placed.
  I am appalled that the Minister was so complacent about Cuba. I had never seen such a gap in beliefs. British Shipbuilders believes that it is dealing with a real prospect. If the Minister does not believe that, he should call BS in and accuse it of wasting public money. People have been going to Cuba, no longer at the initiative of British Shipbuilders but at the request of the Cubans who want to buy ships, and technical discussions have taken place. The Minister says that there has been talk of these orders for long enough. I cannot believe that he does not know that these orders are the hottest prospect of substantial orders for British Shipbuilders for a long time. The Department should he saying to British Shipbuilders, "What kind of financial arrangements shall we need to clinch the order? What kind of loans, period of grace, interest rates and package shall we need? Let's get on with that so that there is work in the yards and orders are signed."
  Having denied that there are orders to be won and having dismissed the Cuban order, the Minister then says, "If there is an order, we shall have to consider it carefully. We are not sure whether we can carry on putting in money." I hope that he will at least have the decency to acknowledge that, if British Shipbuilders managed to clinch that substantial order, it would save NESL for a long time to come. We should not then have the final sabotage of the Department refusing to put together the necessary cover and financial package. That would really give the lie to everything else that he has said.
  The Minister should face another fact. With all the talk about private yards, one would think that it was a great success story for the private sector and failure for the public sector. Let us consider some of the losses to which

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  the Minister frequently refers in respect of British Shipbuilders. The assets of the privatised yards were virtually written off, and that shows up as part of the allegedly huge losses that British Shipbuilders has made.
  Let me bring matters a little closer to home. The ITM Challenger, whose owner defaulted and went bankrupt, was ordered by the private sector. There are two sides to the private sector—the builders and the people who buy the ships. The £47 million for the ITM Challenger showed up as part of the loss put down to Sunderland. That was due to the failure not of public enterprise, but of the entrepreneurial system about which the Government are so enthusiastic.
  The Danish ferries are not being ordered by the British Government, by British Shipbuilders or, indeed, by anyone in the public sector. Those ferries, whose owners now appear unable to pay for them and are attacking the standards of British Shipbuilders to cover up for that, were ordered by private entrepreneurs. I should have thought that when such a scheme fails, and that failure jeopardises thousands of jobs and threatens to end a community's history of shipbuilding, the Government, who are so enthusiastic about such schemes, would step in and do something to save the situation.
  I conclude by quoting some of the Prime Minister's remarks when she named the Stena Seawell in my constituency on 25 April 1986. She said:
  "This is a very proud day for Sunderland shipbuilders and for Britain and I am proud to be a part of it. You, Mr. Olsen, and your people designed the most modern ship with the latest technology that could be built anywhere in the world and you chose this shipyard and you chose this management and you chose this work force to to it and they've done it, and they've done it superbly. It has been a tremendous boost for us that we can achieve this in our country. It teaches us that we can do the latest technology and that we can do it well. We have the skills, the enterprise, the inspiration to do it. Thank you. Congratulations. I hope we'll be able to do a repeat performance by virtue of the tremendous advertisement we can blazon across the world with what we've done on this ship the Stena Seawell."
  For the people of Sunderland, the next few weeks will determine whether that was flag-waving, empty rhetoric and hypocrisy or whether the Prime Minister is now prepared to put her money where her mouth is.
  6.4 pm
  Miss Emma Nicholson: I am immensely grateful for the chance to speak briefly in the debate, because I am concerned about the future of Appledore Ferguson which has been discussed in detail today. Like the hon. Member for Wallsend (Mr. Garrett), I made my maiden speech on shipbuilding because of my concern about the matter, although I do not have as many years' experience of such matters as the hon. Gentleman. Nevertheless, I share his concern for the individual yards.
  There have been grand speeches today about the future of British shipbuilding. We are talking about individual yards and jobs. I am concerned because Appledore Ferguson is a large employer in my constituency. There are 530 jobs in that yard and my task is to protect them because the yard puts £10 million into the Torridgeside economy. That may not sound a great deal to some hon. Members, but the Torridgeside area has historically been short of work and incomes have been low in comparison
  1138
  with other areas. Every shipyard job creates in the area at least five other jobs, which must also be protected and expanded.
  It is not a single-industry economy in my area, but a mixed economy with many other factors depending on the large employers. The many people who come to see the shipyard and do business there attract other work to the area. They may add to our burgeoning tourist industry and they also visit our farms. The hon. Member for Wallsend mentioned the problem of support for farms and price support for farmers, but I am happy to tell him that, in the recent agriculture debate, Opposition Members committed themselves to supporting farming and to price support in that respect.
  We have to eat, and we must grow as much food of our own as it is economically possible to do. I would be deeply concerned if, as an island, we ever stopped making ships, but it is a question of balance, as in so many other areas of political life. Flow much money do we want to pump into shipbuilding and farming, and how much should go into other sectors, such as social benefits? It must be a right and proper principle for private funding to be attracted by the Government and to come into the shipbuilding industry in every way possible, so as to release funds for other socially important matters.
  I was therefore delighted to hear the Minister say that the Government were committed to sustaining economic activity in shipyard areas. I welcome that crucial commitment, but, following his statement of a few weeks ago, the workers at Appledore Ferguson are intensely worried about their future. Theirs is a right and proper concern, because job uncertainty has implications for families and the future. Above all, I seek from the Minister an understanding about and guarantees for the future of jobs in the yard. I know that it is difficult to ask him to look into a crystal ball, but, as the future of the yard's employees was undefined when he made his last statement, perhaps he can tell us a little more today.
  I am pleased that a large lobby has come from the yard to the House today. I have paid two visits to the yard since I have lived in the area and I have another visit planned at the invitation of the convener, Dick Mathews, and his colleagues. I have been a little late in accepting it, but I am looking forward to making the visit shortly.
  The Minister will recall that I have raised with him my concerns about Appledore several times, both in debate and privately. My concerns today can be stated very briefly, but they are none the less strong concerns. First, and most important, we should retain Appledore Ferguson as a shipbuilding unit. If we consider the examples of other former shipyards, we see that part of Falmouth has become a marina under Vosper Shiprepairers Ltd. Lowestoft is halfway to being a marina under Brooke Marine and Robb Caledon Shipbuilders at Dundee has gone into luxury flats. Much nearer home, Richmond yard, Appledore, cannot be used any more for shipbuilding and has gone to become luxury flats, and Bideford shipyard is now overrun by houses.
  I can accept that those may be right and proper uses for those unneeded yards, although I would have preferred Richmond and Bideford to go a different way but, as the Minister well knows, Appledore is needed in the shipbuilding world and must not go that way. It is crucial that I obtain the Minister's commitment that the Government will do their best in that respect.

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  In the event of a sale, it is important that every effort should be made to keep the men and management fully in the picture, because so much shipyard knowledge is contained within the yard. It has perhaps the best union-management relationship in the business, and it is important that the track record on involving the work force in policy formation should be retained during this exceptionally difficult period. I accept that commercial constraints make that sort of commitment nigh impossible to give, but I put it on the record so that it can be carefully considered as buyers come out of the shadows and become potential bids. Appledore shipyard has a unique track record on union-management relationships.
  It would be difficult even for a yard with the pre-eminence of Appledore Ferguson to survive on the open market without any support. Hard work cannot win against unfair competition, and by that I mean some of the competition from the far east which is so heavily subsidised. Appledore excels in making small dredgers, but it could make any sort of ship up to 10,000 tonnes. Support of about 20 per cent. or 28 per cent.—the figure is perhaps higher than the one given by the hon. Member for Argyll and Bute (Mrs. Michie)—is necessary, even for making dredgers. I cannot help thinking that those interested in the yard will also be interested in a continuing commitment to some form of support by the Government or European Community.
  Appledore has a bright future and I ask the Government to help, not hinder, the yard's development.
  6.12 pm
  Mr. Bruce Milian: I agree with a good deal of what the hon. Member for Torridge and Devon, West (Miss Nicholson) said. Unfortunately, she is one of the few Conservative Members who takes a keen interest in the shipbuilding industry. It is a pity that more Conservative Members do not take that interest in this extremely important industry.
  I do not know whether the Minister thought that anything he said would reassure those involved in the industry who are extremely worried about the future, but I can tell him that nothing he said will provide reassurance. He told us little that we did not already know and the one or two pieces of information were rather detrimental to the interests of the industry and will certainly cause more rather than less anxiety.
  The Minister did not answer some basic questions, one of which relates to the takeover of my yard at Govan by Kvaerner Industries, and the continuation of the subsidies under the sixth directive. That is a five-year commitment, started on 1 January 1987. It has been renewed at the present level of a maximum of 28 per cent. for 1988, as it was for 1987, hut, as far as I am aware, there is no commitment for the Government that there will be that level of subsidy or any other beyond 1988. There have been all these stories in the press, some of which have undoubtedly been leaked from the Department—
  Mr. Kenneth Clarke rose—
  Mr. Milian: With respect, if the Minister had wanted to give that assurance, he should have done so at the beginning of the debate. He spoke for a long time and told us very little, and a Minister will reply, so I have no intention of giving way to him now.
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  What will happen in the next three years? The Secretary of State for Scotland can give an assurance when he replies, if there is one to be given. The Minister said absolutely nothing about the level of subsidy beyond 1988. The hon. Lady has just made a similar plea, that we want to know what will happen about EEC subsidies over this five-year period and, indeed, over a longer period.
  The idea that the Government have had a genuine commitment to shipbuilding over the past eight years does not bear serious examination. They have looked on British Shipbuilders as an embarrassment. They have already dismembered it by selling the naval yards and now they are hellbent on selling the rest. I do not accept that they have had any commitment to or faith in the future of British shipbuilding, certainly not on the merchant side.
  Govan is an excellent yard and the facilities there are first class, as has been acknowledged by Ministers. The management is good and there is excellent co-operation with the work force. I acknowledge immediately that there has been a problem with orders in the past three or four years. Anyone who knows the yard and is worried about its future is anxious to see that it gets new work when the Chinese orders, which it is building now, run out in 1989.
  Nevertheless, the announcement about Kvaerner, or rather the leak in The Daily Telegraph, of all papers, about the Kvaerner interest in purchasing Govan, has caused considerable upset and anxiety, particularly as shop stewards were specifically assured only two days previously that rumours about a Norwegian buyer were absolutely groundless. Therefore, there is some anxiety to overcome for that reason alone.
  Today we have been told nothing about the progress of negotiations. The Minister keeps saying that the negotiations are with British Shipbuilders, but his Department is involved. I do not complain about that—it is absolutely right that it is involved—but an official from his Department is to be present at the meetings which he mentioned were to take place next week in Norway, so the Government have a direct interest and we are entitled to more information than we have had so far about exactly what is going on. In a foolish statement on television a couple of weeks ago, the Minister said that there was no question of the Government laying down conditions in these negotiations. In other words, the Norwegians or anybody else can take over the yard, regardless of circumstances. They can take it off our hands, as it were. Conditions must be laid down if the yard is to be sold or, as it seems, given away.
  The Govan yard, like all other merchant shipbuilding yards, has had all its assets written down to nil, apart from land, in the 1986–87 accounts. Incidentally, that is a reason for the huge figures of subsidy which the Minister quoted. If the Government give away the yard at a bargain price, which is almost inevitable given their attitude, there should be understandings, and as far as possible legal conditions should be laid down, about its future.
  Two gas-carrying ships are to come to the yard and that is extremely welcome. That work will be invaluable. But what happens after that? There is no definite commitment, although there are hopes, aspirations and vague promises. We do not know what the Norwegians intend to do about building other types of ships at the yard. We do not know whether they intend in due course—I hope that they do if the negotiations succeed—to put LNG carriers as well as LPG carriers into the yard. We learned very little by way of detail from the Minister today about the transfer of gas

  1141
  technology. There is also the question of more investment in the yard, widening the berths and so on. All those are crucial issues for the long-term future of the yard. Answers to those queries will be very important and will show whether the Norwegian company considers the yard to be a long-term commitment.
  We know that there is another side to the picture. Apart from any investment, there is talk about a significant number of redundancies. The Minister did not even mention that this afternoon. We know that if the Norwegian company becomes the owner of the yard, it intends to operate with a core work force of about 450 men and women less than the present work force. There have been no discussions or negotiations with the trade unions. One of the directors of Kvaerner visited the yard and had informal conversations with the shop steward. However, I checked yesterday and there have been no official discussions with the trade unions on the future labour force, conditions and working practices in the yard. It is absolutely essential from the Minister's and Kvaerner's point of view that the discussions take place. Unless there is a proper understanding on those matters, the yard cannot possibly be successful.
  There is a long way to go yet. The workers in the yard will be extremely disappointed by the Minister's comments this afternoon. They have made it clear that although, like me, they oppose privatisation, and would like the yard to remain with British Shipbuilders, if the Government are determined to dispose of it, they will make the best of things and co-operate with the new owners.
  I met Mr. Gronner a senior director from Kvaerner at an informal meeting a few days ago. I recognise that Kvaerner is a reputable shipping company with wide interests in engineering and shipping as well as shipbuilding. If the negotiations succeed, I believe that the company intends to try to make a real go of the yard. Kvaerner has more faith in the future of shipping and shipbuilding than the Government. That is one of the problems that we must deal with. If the Government had the same faith as Kvaerner about an upturn in the shipping and shipbuilding industry, the yard could successfully remain under the present ownership.
  The Government have said that we should he flattered—I believe that Ministers used the word "flattered"—that someone is willing to purchase the Govan yard. What an absolute recognition of defeat. The Government are saying that we should be pleased that someone is going to take the yard off their hands and make a go of it. Why can we not make a go of it ourselves? That question was asked when the news was leaked and we are still asking it, because it has not been answered satisfactorily.
  We could have attracted the orders for the gas-carrying ships into Govan without disposing of the yard. I do not believe what the Minister said this afternoon about Kvaerner wanting to build those ships in that yard. We could have attracted the orders—or similar orders—into the Govan yard without disposing of the yard. As an alternative, we could have had a joint venture arrangement between British Shipbuilders and Kvaerner. However, the Government have dismissed those possibilities. We are left with the alternative of purchase, which may hold out some hopes for the future of Govan in the short term. However, I am concerned about the longer-term interest.
  1142
  It would be absolutely tragic for Govan if a deal was struck with Kvaerner or anyone else which was good for the short term, but led in the long term to the ultimate demise of the yard. I am interested in the yard's long-term prospects; that is why I want to see the firmest commitment from the Kvaerner management in the process of negotiations. After all, we are selling to a foreign firm. We know how difficult it is to have decisions reversed if a closure happens in a factory or establishment under British ownership. The difficulties will be all the greater if we are dealing with a foreign firm.
  I am not claiming that Kvaerner does not have good intentions for Govan: I believe that its intentions are good. I hope that those intentions are fulfilled. We can be more certain that they will be fulfilled if we lay down conditions now. Unfortunately, from what the Minister has said today and from his general attitude on this matter, it seems that the Government will not bother to try to lay down those conditions.
  6.24 pm
  Mr. Neville Trotter: The hon. Member for Wallsend (Mr. Garrett) and my hon. Friend the Member for Wirral, South (Mr. Porter) have rightly drawn attention to the successful state of affairs in our naval yards. I am sure that more export orders will arrive in the near future. The potential for the Canadian nuclear submarine order is gigantic and we must all hope that Vickers is successful in receiving that order.
  My hon. Friend the Member for Wirral, South did not mention the submarine work carried out by Cammell Laird. It is fortunate to be one of the few specialist submarine builders in this country, and it has assured work through its initiative with Vickers. If we had more time tonight, I should have wanted to consider the refit work of the Royal Navy which is vital to the future of the repair yards on the Tyne. No doubt we will be able to return to that subject in future.
  The main subject for debate tonight is clearly the future of merchant shipbuilding in this country. I believe that the House regards it as inconceivable that our island should not have some Merchant Navy shipbuilding capability. It is not simply a matter of our long island history; it is a question of looking to our future strategic needs. I remain convinced that we will continue to build merchant ships in future, although obviously on a far smaller scale than we would all have liked.
  I remind the House that for a long time I have advised the marine equipment industry. I want to draw the attention of the House to the widespread nature of employment in the equipment industry. Many of the factories producing parts for ships are nationally and historically situated near ports and dockyards. However, many of the firms are in the midlands, miles from the sea. It is essential to remember that while the industry has done very well in exporting parts to foreign shipyards, it requires a healthy home base if it is to continue to do that in future.
  The Ultimate Dream was referred to briefly. I appreciate that my right hon. and learned Friend the Chancellor of the Duchy of Lancaster was right to say that that gigantic project for a 160,000-tonne cruise liner, which will be twice the size of the QE2, is basically a subject for the Northern Ireland Office, as the discussions involve Harland and Wolff. More than half the cost of the ship

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  would go in parts that would be constructed mostly on the mainland of Great Britain. No doubt many of those parts would he built on Tyneside and, I hope, Wearside.
  I want to consider the sombre scene facing the merchant shipping yards. The present position has not come about suddenly. It is not a sudden development, apart from the crisis at Sunderland Shipbuilders. We have debated the shipbuilding scene for many years against a background of lack of orders and ridiculously low-cost competition from the far east.
  My right hon. and learned Friend the Chancellor of the Duchy of Lancaster reminded us of the significant amount of aid given to the industry by the Government since 1979. I believe that talking about billions of pounds is almost meaningless to the man in the street. However, if we divide the commitment provided by the Government in terms of financial aid, it works out at £1 million for every working day since the Government came to office in 1979. I congratulate the Government on having provided that support for the industry and on having recognised its importance to the country.
  I also want to draw the attention of the House to the enormous efforts made by British Shipbuilders management to modernise the yards and revolutionise working practices. In the past two years £2 million has been spent on research and development and £3 million on product development. Many new designs have been offered to the Sunderland yard and the other yards and an enormous effort has been made worldwide to find orders. That has not produced the number of orders that we would have wished, but it is not for lack of trying. It is the result of the gross over-capacity worldwide. In particular, it is the result of the development of the industry in South Korea. That country now has an order book bigger than that of Japan, and the small country of Korea now builds more ships than Europe.
  At present, there are 75 tankers on Korea's order book. No tanker is building in Britain and I doubt whether one is building in Europe. We, like the other European countries, are left running around the world desperately trying to obtain orders for one or two ships at a time.
  Korea decides the world prices. My inquiries there suggest that, allowing for the long hours of work, its wage rates are about one quarter of those that Britain pays. Industry leaders from Britain who were in Korea a few months ago suggest that the labour costs overall, allowing for the lack of national insurance contributions, and so on, are about 20 per cent. of European labour costs. It is not surprising that it has been difficult for European countries to compete against such figures.
  A recent EEC study shows that the cost of building a tanker in Europe is $43 million. In Korea, an equivalent ship sells for $24 million. The cost of building a bulk carrier in Europe is $21 million, and such a ship in the far east would be sold for $12 million. I could go on with other examples. It is against such competition that we have a serious lack of orders.
  The situation at Sunderland is not the fault of British Shipbuilders, and it is certainly not the Government's fault. However, there is a genuine and great worry in that area about the shipyard's future. It is hard to see what assurances the Government can give in present circumstances. The Government seem to be doing all that they can to sort out the sorry situation that has developed over the Danish order, but I am sure that my right hon.
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  and learned Friend the Chancellor can understand the need for a message of hope to come out of tonight's debate.
  It is extremely hard to see how the Danes can be justified. The yard is capable and experienced, with a well-respected managing director and a skilled work force. The reasons for the trouble are very much those suggested by the hon. Member for Sunderland, North (Mr. Clay) in his comments about the customer. It is interesting to reflect that the ECGD has not branded the customer as being at fault, and I find that rather surprising.
  The ships for Cuba might produce salvation in the short term. We are looking at the long-term future for the industry in the rest of the country, but we must face the fact that in Sunderland we are talking about the short-term solution and salvation. We must all hope that something will come from the strenuous marketing efforts being made over those Cuban ships.
  The intervention fund, which matches the aid given by our Western competitors in Europe, must continue. I believe that the Government accept that, and it should be spelt out. There will be an opportunity to do that as the discussions on the Cuban order proceed.
  We are talking about an industry that has an important future for Britain, and hon. Members should do all that they can to ensure that future.
  6.33 pm
  Mr. Ken Maginnis: There is one simple and direct question about shipbuilding that the Government must ask themselves and to which they must provide an unequivocal answer. Are we in the United Kingdom to retain a merchant shipbuilding capability, or do we intend for all time to surrender our traditional and proven skills in that area to foreign yards?
  In recent times merchant shipbuilding has suffered cruelly at the hands of those who look for sensational negatives. Both inside and outside Government there are those whose purpose in life appears to be to demoralise and dismantle the industry.
  I am disappointed by the apparent lack of understanding of the commercial realities—the need for intervention funding for our merchant shipbuilders. It evokes much ill-informed comment, and that must be a matter for regret. It should be fairly acknowledged that privatisation, even if one is convinced of the attractions for the management of the companies concerned, is not in itself an automatic panacea. It does not alter the international pricing level for ships which makes intervention funding a necessity—a commercial reality of life for all EC countries. The United Kingdom cannot isolate itself from that reality if it is to maintain a core of merchant shipbuilding capability in line with the majority of European nations.
  Kvaerner, on entering talks on the sale of Govan, made it clear that it will go forward with a deal only on the understanding that there will be access to intervention funding. That is not surprising, because it is the agreed and accepted way in which other European shipbuilding nations operate to match far east competition.
  I listened to the Minister on the radio this morning when he spoke of shipbuilding in terms of what is happening at North East Shipbuilders Ltd. I agree that it is a matter of regret that the company is in difficulty with

  1145
  clients over the future of a valuable ferry order. It is to be sincerely hoped that that can be completed as originally ordered.
  However, in the present situation it cannot be surprising that North East Shipbuilders Ltd. does not have customers tied up and willing to place an order. Without a customer, the whole question of intervention funding becomes irrelevant. But surely, in current market conditions, the Government's policy on shipbuilding and intervention funding in the United Kingdom cannot be based on that one yard. Is it the Government's wish to allow a situation where such is the doubt created in the minds of those who would order ships that they automatically look away from British yards to those on the continent or in the far east?
  That is not how it has to be. Everything points to an upturn in overall market conditions within the next two to three years. Whereas in 1983 there was a laid-up 90 million tonnes, or 15 per cent. of the world fleet, that figure has dropped dramatically to around only 3 per cent. today. That usage, combined with the comparative obsolescence of a large part of the world's fleet, shows that much new build must occur in the early 1990s.
  I have seen the Harland and Wolff yard in my region come through a traumatic six-year period during which it has cut its work force by over 60 per cent. It has just completed negotiations which will produce a degree of flexibility within the remaining work force which is unparalleled in the United Kingdom and will match the best in Europe, and it has adapted itself to the market demand for high-tech ships. That, and the massive dry dock and other capital resources that Harland and Wolff possesses, puts it in a position to compete on virtually equal terms with European opposition.
  Nor did the cost of that rationalisation come anywhere near the £20,000 per job that I heard the Minister quote on radio this morning and in the House this afternoon. With the exception of the last year, when there was a one-off situation, the average annual cost per job has been about one third of that figure.
  I was surprised to hear the Minister refer to extra costs as loss costs. They are the costs of restructuring—restructuring to enable shipbuilding to move forward to the 1990s. We could not produce new jobs which would impact throughout the United Kingdom, as shipbuilding does, for anything like that cost.
  What a pitiful surrender it would be if, with brighter prospects ahead, the Government were now to implement a stringent unilateral policy on intervention funding, completely out of line with our EEC partners. It would sound the death-knell for our merchant shipbuilding industry.
  At Harland and Wolff one finds a different situation from that at North East Shipbuilders Ltd. Harland and Wolff has customers who are willing to place orders which would bring the United Kingdom back to the very forefront of the cruise liner market. Yet every sort of innuendo, damaging criticism and abuse is levelled not only at Harland an Wolff, but at their biggest potential customer.
  Are we really trying to create a situation where we hand over to a foreign yard the work and prestige connected with that project, and probably further similar orders?
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  Further, is every shipowner, particularly shipowners with proven track records, to be treated as fair game for totally unjustified criticism when expressing a desire to have a vessel built in Northern Ireland? That is hardly the way for the United Kingdom to go about winning major export contracts.
  Some sections of the press appear to have got it wrong, too. It was not a proven industrialist, such as John Parker, who brought De Lorean to Ulster; it was the Government of the day. Leaders of industry and respected customers should not have to live for ever under that cloud. Must that spectre be permitted to crush all potential for initiative and creativity in the Province?
  I am concerned that, just as we have lost virtually all our merchant fleet since 1982, so we may be losing our potential to rebuild it, if and when the opportunity or need arises. One must also consider the domino effect that any further contraction of the shipbuilding industry will have—not only in areas of shipbuilding but throughout the country. The vital knock-on effect of a large proportion of any shipbuilding contract being sub-contracted throughout Northern Ireland and the rest of the United Kingdom has already been described. Letters have been sent to my hon. Friends the Members for Upper Bann (Mr. McCusker) and for Antrim, East (Mr. Beggs) from Ulster Carpets and from CM R Electronics, which wish the Ultimate Dream contract to go ahead because it will create work for those companies. The Minister really should have understood that if Harland and Wolff is to arrive at a contract price, inquiries must go out to the companies that will be involved in sub-contracting.
  Is there not every justification for the United Kingdom to retain a core merchant shipbuilding industry so that it may at least compete on equal terms with other European yards? Both the Minister and the House know the answer to that question. I hope that sensible decisions will be taken which will give back hope and confidence to both our merchant shipbuilding industry and its potential customers.
  6.42 pm
  Mr. Donald Dewar: The Chancellor of the Duchy opened with the implicit criticism of our action in originating this debate. The suggestion was that it came too early. It was necessary to have this debate now because of the anxiety which exists over the uncertainty and problems facing the shipbuilding industry. That uncertainty will undoubtedly affect morale and confidence, and it is right that we should push the Government for an up-to-date report. If the House is not entitled to such a report, certainly those whose livelihoods depend on the industry are entitled to know what progress has been made. My one regret is that the House has learned disappointingly little as a result of this exercise. However, that does not invalidate our attempt, and certainly we shall be returning to press the Minister again and again.
  Much depends on the Government's attitudes. Because it is not the main subject of the debate, I shall make only a passing reference to the major frigate shipbuilding company of Yarrow, which is located on my constituency boundary. The Chancellor of the Duchy made only a very casual reference to the type 23 orders, and could not say what they would total or when they would be forthcoming. I recognise that it may be difficult for the Minister to give

  1147
  that information, but it is essential that Yarrow receives an early order for four type 23s. As the right hon. and learned Gentleman knows, it has been promised only a variation of between one and four orders. All the yards are gasping for those orders. In the case of Yarrow, there have already been some redundancies, and if no orders are received there will be substantial job losses by the end of the year. Those orders are as important to Swan Hunter, Vickers and Vosper as they are to Yarrow. That is one area of the shipbuilding industry where immediate salvation lies entirely within the confines of the Government's ordering policy and is in the hands of Ministers.
  It is interesting that the Minister feels that the talks concerning Govan are progressing well. He was being optimistic when he said that the work force there welcomed what was happening. That is not a very accurate description of the situation. There may be recognition that, sadly, the sale of Govan may be the only way forward. If that is so, everyone in the yard, in Glasgow, and in the shipbuilding industry generally will want to make a success of that development. However, it would be wrong if Ministers—as has occasionally been the case in similar circumstances previously—presented that situation as some kind of triumph and a major advance. It is a retreat for the British shipbuilding industry, now that a very important yard will be flying a foreign flag.
  I have considerable sympathy with the point made by my right hon. Friend the Member for Glasgow, Govan (Mr. Millian), who questioned whether it was necessary for the yard to go with the orders. The Minister said that it was a fine prospect that Kvaerner was setting up its gas technology industry on the Clyde. I am not clear what that means, beyond the two orders which have been pledged to the yard. If there is a wider prospect, and if there will be a larger spread of jobs, perhaps the Secretary of State for Scotland, who must be following these matters closely, will say a word or two about them. He will appreciate that the phrase "some restructuring", which has taken on a somewhat sinister air, is one in which we are all entitled to take an interest.
  I underline the point about early consultation with the work force and with the shop stewards. Whether or not rumours about 450 job losses are correct, it is important that we look for long-term guarantees and that the Government involve themselves not just in providing two orders in the short term but also in creating the kind of base which will allow the yard to continue flourishing.
  The House was told that there was a wealth of inquiries for some smaller yards. I was glad at least that there was mention of Clark Kincaid and of Ferguson. My hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman), who has sat patiently throughout this debate but who has not managed to catch Mr. Speaker's eye, has pressed the Minister in the past on that subject. It seemed as though Ferguson was far from the Minister's mind on that occasion. I hope that the right solution will be found for that yard and for Appledore, whose future was eloquently defended by the hon. Member for Torridge and Devon, West (Miss Nicholson). We shall be looking for further details of the Government's plans at an early stage.
  NESL faces a difficult and tragic situation. It is depressing to see the way in which Ministers approach it. I was angry at the way we were accused of scaremongering and of presenting a gloomy scenario that could not he justified. However, almost everything said by the Minister could be described in exactly those terms.
  Mr. Chris Mullin: Does my hon. Friend agree that it is extremely difficult for the management and the work force of NESL to secure orders against the background of the black propaganda emanating from the Department of Trade and Industry, seen most noticeably in The Guardian' front page leader on 4 March?
  Mr. Dewar: It was certainly rich of the Government to accuse us of being defeatist about the industry's prospects when the Minister could only tell the House that he was unable to intervene in any way and could only stand by and hope that everything 'would be all right with the Danish contract. He acknowledged that it might be a great blow for the local economy, and the nearest thing to good news he could manage was that if a shutdown was necessary, it would not be made overnight—that there was no imminent threat of all work coming to an end: no imminent threat, but presumably a medium-term threat.
  The Minister went on—I thought, suggestively—to speak of other prospects in the area, such as Nissan, and about the general level of unemployment. I do not know what is the Minister's idea of defeatism, but such remarks will not put a spring into the step of anyone working for NESL or living in Sunderland. I hope that he will take a more positive approach and will recognise that he has a duty to that yard, as he has to the other sectors of the British shipbuilding industry which have been in public ownership.
  The Government resent the suggestion that they lack commitment, but there were real signs of that in what the Chancellor of the Duchy had to say. We distrust ministerial motives and believe that there is a real danger, as anyone who studies the Government's track record will understand, that the Government will privatise and shove the yards out of the public sector and then walk away from the problem without a backward glance. I do not believe that a responsible Government should do that, or that we should in any way encourage them or give them an easy passage if that is what is in their mind.
  I believe that the shipbuilding industry has a future. There has been much talk about some recovery in the market, which can be seen in the amount of tonnage laid up, in charter rates and so on. It will be a long haul; it will be a difficult market for a very long time. But there is room for a specialist shipbuilding industry in this country, with all the skills and engineering excellence that it represents.
  The Government should recognise that. They should look at the areas where public sector orders may arise and perhaps can be advanced. They should give realistic commitments about the level of support and their willingness to abide by at least the EEC level of 28 per cent. It is important that they put themselves out to help the industry through what is undoubtedly a very difficult period. It is all too convenient to say that part of it could be sold and the rest could be industrial scrap. That means putting on the scrap heap many people with real skill who have given a lifetime of service to that industry, or hoped to do so.
  The Minister said, in a phrase that I thought rather quaint, that the industry was at a somewhat difficult crossroads. I thought it quaint because it so understated the evident danger that faces almost every yard and every part of the industry. We are determined that, if the industry is at a crossroads, the Government should at least make the right choices. We will do all that we can to

  1149
  concentrate the Minister's mind on that, because we feel that if he is left to himself there may well be an abdication of responsibility, with tragic consequences.
  6.51 pm
  The Secretary of State for Scotland (Mr. Malcolm Rifkind): We have had a very serious and constructive debate. It is perhaps significant that a substantial proportion of those who have contributed have a deep and personal constituency interest in the future of shipbuilding. I pay tribute to my hon. Friends the Members for Torridge and Devon, West (Miss Nicholson) and for Waveney (Mr. Porter), to the hon. Member for Sunderland, North (Mr. Clay) and to the right hon. Member for Glasgow, Govan (Mr. Milian), whose passionate speeches clearly showed their concern for their local communities—as have those of other hon. Members who have caught your eye, Mr. Speaker.
  The debate takes place at a time when there is a feeling on both sides of the House that we wish to maximise the prospects for shipbuilding in the United Kingdom, but on a basis that is healthy and viable. We are conscious that over the past few years the prospects for shipbuilding throughout western Europe have been very grim. Sweden, for example, has closed its last major merchant shipbuilding yard. The French have run down their yards from five to only one, and the Spanish have reduced their capacity by some 50 per cent. The Germans, the Danes and even the Japanese have been closing yards. This is not a problem peculiar to the United Kingdom, and it is not sufficient simply to have good will or good intent. As my right hon. and learned Friend the Chancellor of the Duchy rightly pointed out, in the absence of orders there is a grim future for any industry.
  Over the past 10 years, the Government have made their commitment very clear. The £1,800 million that we have made available has not simply been support through the intervention fund; that has been a relatively small proportion of the total, becuse of the limits that are required. A substantial amount has been used to cover the trading losses of companies that obtained orders. That is one of the saddest facts about the shipbuilding industry; even when orders have been obtained, many companies have sustained massive losses.
  The right hon. Member for Govan said that he was concerned that my right hon. and learned Friend had, as he claimed, given no indication of the Government's view about the future of support for the industry. I ask him to read tomorrow what my right hon. and learned Friend said. Perhaps I can remind him. He said that, with regard to support for new orders, we have made it clear to all who have inquired in connection with the present disclosures that we are prepared to discuss support for new orders with them.
  Dr. Godman: The Secretary of State knows that I have been present throughout the debate. May I point out that I sincerely hope that, if the Norwegian firm is successful in its bid for Govan, the Government will impress on it the need to order the engines for the liquefied petroleum gas carriers from Clark Kincaid in my constituency? May I also plead for the Secretary of State to keep a tight weather eye out for Ferguson, also in my constituency? Both, as he well knows, are very important to the local economy.
  Mr. Rifkind: I entirely agree with the hon. Gentleman. He is right to express concern for both establishments, and it is encouraging that there has been interest in both as a result of the Government's recent announcement.
  It is important to remember a number of important considerations about Govan. First, as the right hon. Member for Govan well knows, the Government did not simply go out looking for a purchaser. Kvaerner made the first approach, expressing an interest in acquiring the yard. The Government then responded to that interest.
  Secondly, it is not a speculative interest. We are all aware that, occasionally, companies buy yards and then hope to find orders. What is most encouraging and welcome about Kvaerner's interest is that, far from wishing to look for orders, it has orders, and has already said that, if it is successful in acquiring the yard, there are at least two liquefied petroleum gas carriers that it wishes to build in the yard, and further orders for similar vessels are likely. Of particular importance is the firm's suggestion that, apart from the shipbuilding role that it sees for Govan, it wishes the centre of its gas-handling technology to be transferred there. That is not only important from a technological point of view, but could lead to a significant number of jobs in the Glasgow area.
  One of the curious things said by the right hon. Member for Govan was his repetition of what has been said in other quarters, concerning his personal belief that Kvaerner could have been persuaded, or could be required, not to acquire the yard but simply to place orders, while British Shipbuilders retained ownership of the yard. The House will have noted that the right hon. Gentleman did not produce an iota of evidence to substantiate that view. He informed the House that he had had recent discussions with senior management of Kvaerner. Presumably he raised this issue with them. If he has reason to believe that the firm is interested in doing as he suggests, it is surprising that he made no such reference in that respect to the House.
  I must tell the right hon. Gentleman, and the hon. Member for Glasgow, Garscadden (Mr. Dewar). that the simple fact is that Kvaerner made it clear that its interest is in acquiring the yard, not in placing orders. If it does not acquire the yard, there is no guarantee or even likelihood that orders will necessarily come to Govan. They might go to many other shipyards around the world. The right hon. Gentleman must take that into account, for I know that he is as concerned as the rest of us for the future of employment in the yard. Kvaerner's present interest is the best prospect for the yard that has emerged for some considerable time.
  As the right hon. Gentleman knows, once the Chinese ferry orders are complete, there are no other orders on the order book, and the prospects for Govan—whatever the view or policy of Government—could have been very serious. The fact that Kvaerner is not only interested in acquiring the yard but has ships to build there may explain the constructive approach of the unions at Govan.
  When Mr. Sammy Gilmore, the shop steward at Govan, was asked whether the unions would be obstructive and seek to oppose Kvaerner's interest, he replied:
  "We are shipbuilders, not anarchists … The name of the game is employment."
  He rightly went on to say that the trade unions would naturally wish to discuss in detail the consequences for the work force, saying with his customary humour:

  1151
  "There will be no Vikings sailing up the Clyde until after the Glasgow Fair."
  That may be a prediction about timing, but it also demonstrates a desire for the negotiations to succeed, which is very welcome.
  Mr. Milian: What I was trying to find out from the Ministers—I have not done so yet—was what understandings and undertakings they are attempting to obtain from Kvaerner in the negotiations.
  Mr. Rifkind: These are delicate matters of negotiation. Our main interest is that Govan should have not a short-term but a long-term future. Kvaerner is not only talking about two immediate orders for liquefied petroleum gas carriers, but is also suggesting that future orders are likely for the same kind of vessel. Moreover, it would not be suggesting publicly that it wishes to transfer the whole of its gas-handling technology to Govan if its interests were only short-term. There was no need for it to say that. It does not relate directly to the shipbuilding activities at the yard itself. It is a sign of the serious intent of the firm to establish a long-term presence.
  With regard to shipbuilding as it involves British Shipbuilders as a whole, there is a common interest on both sides of the House to try to ensure a long-term future for the shipbuilding industry. We believe that, with a return to the private sector and with the interest currently shown by the private sector, that is realisable. It is on that basis that I invite the House to oppose the motion and to approve the amendment.
  Question put, That the original words stand part of the Question:—
  The House divided: Ayes 187, Noes 261.

  Division No. 314]

  [7 pm

  AYES

  Abbott, Ms Diane

  Coleman, Donald

  Adams, Allen (Paisley N)

  Corbett, Robin

  Alton, David

  Corbyn, Jeremy

  Archer, Rt Hon Peter

  Cousins, Jim

  Ashley, Rt Hon Jack

  Crowther, Stan

  Ashton, Joe

  Cryer, Bob

  Banks, Tony (Newham NW)

  Cummings, John

  Barnes, Harry (Derbyshire NE)

  Cunningham, Dr John

  Barron, Kevin

  Dalyell, Tam

  Battle, John

  Davies, Rt Hon Denzil (Llanelli)

  Beckett, Margaret

  Dewar, Donald

  Bell, Stuart

  Dixon, Don

  Benn, Rt Hon Tony

  Dobson, Frank

  Bermingham, Gerald

  Doran, Frank

  Blair, Tony

  Douglas, Dick

  Blunkett, David

  Dunnachie, Jimmy

  Boateng, Paul

  Dunwoody, Hon Mrs Gwyneth

  Boyes, Roland

  Eadie, Alexander

  Bradley, Keith

  Ewing, Mrs Margaret (Moray)

  Bray, Dr Jeremy

  Fatchett, Derek

  Brown, Gordon (D'mline E)

  Faulds, Andrew

  Brown, Nicholas (Newcastle E)

  Field, Frank (Birkenhead)

  Brown, Ron (Edinburgh Leith)

  Fields, Terry (L'pool B G'n)

  Bruce, Malcolm (Gordon)

  Fisher, Mark

  Buchan, Norman

  Flannery, Martin

  Buckley, George J.

  Foot, Rt Hon Michael

  Caborn, Richard

  Foster, Derek

  Campbell, Menzies (Fife NE)

  Foulkes, George

  Campbell, Ron (Blyth Valley)

  Fraser, John

  Campbell-Savours, D. N.

  Galbraith, Sam

  Canavan, Dennis

  Galloway, George

  Carlile, Alex (Mont'g)

  Garrett, John (Norwich South)

  Clark, Dr David (S Shields)

  Garrett, Ted (Wallsend)

  Clarke, Tom (Monklands W)

  George, Bruce

  Clay, Bob

  Gilbert, Rt Hon Dr John

  Clwyd, Mrs Ann

  Godman, Dr Norman A.

  Cohen, Harry

  Golding, Mrs Llin

  1152

  Gordon, Mildred

  Morley, Elliott

  Gould, Bryan

  Morris, Rt Hon A. (W'shawe)

  Graham, Thomas

  Morris, Rt Hon J. (Aberavon)

  Grant, Bernie (Tottenham)

  Mowlam, Marjorie

  Griffiths, Win (Bridgend)

  Mullin, Chris

  Grocott, Bruce

  Nellist, Dave

  Hardy, Peter

  O'Brien, William

  Healey, Rt Hon Denis

  O'Neill, Martin

  Heffer, Eric S.

  Orme, Rt Hon Stanley

  Henderson, Doug

  Parry, Robert

  Hogg, N. (C'nauld & Kilsyth)

  Patchett, Terry

  Holland, Stuart

  Pendry, Tom

  Home Robertson, John

  Pike, Peter L.

  Hood, Jimmy

  Powell, Ray (Ogmore)

  Howarth, George (Knowsley N)

  Quin, Ms Joyce

  Howells, Geraint

  Radice, Giles

  Hoyle, Doug

  Randall, Stuart

  Hughes, John (Coventry NE)

  Redmond, Martin

  Hughes, Robert (Aberdeen N)

  Rees, Rt Hon Merlyn

  Hughes, Sean (Knowsley S)

  Reid, Dr John

  Hughes, Simon (Southwark)

  Richardson, Jo

  Illsley, Eric

  Roberts, Allan (Bootle)

  Ingram, Adam

  Robinson, Peter (Belfast E)

  Janner, Greville

  Rogers, Allan

  John, Brynmor

  Ruddock, Joan

  Jones, Barry (Alyn & Deeside)

  Sedgemore, Brian

  Jones, Martyn (Clwyd S W)

  Sheerman, Barry

  Kaufman, Rt Hon Gerald

  Sheldon, Rt Hon Robert

  Kirkwood, Archy

  Short, Clare

  Lamond, James

  Skinner, Dennis

  Leighton, Ron

  Smith, Andrew (Oxford E)

  Lestor, Joan (Eccles)

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

  Livsey, Richard

  Snape, Peter

  Lloyd, Tony (Stretford)

  Soley, Clive

  Lofthouse, Geoffrey

  Spearing, Nigel

  Loyden, Eddie

  Steinberg, Gerry

  McAllion, John

  Stott, Roger

  McAvoy, Thomas

  Strang, Gavin

  McCartney, Ian

  Straw, Jack

  Macdonald, Calum A.

  Taylor, Mrs Ann (Dewsbury)

  McFall, John

  Taylor, Matthew (Truro)

  McKay, Allen (Barnsley West)

  Turner, Dennis

  McKelvey, William

  Wall, Pat

  McLeish, Henry

  Wallace, James

  Maclennan, Robert

  Walley, Joan

  McNamara, Kevin

  Wardell, Gareth (Gower)

  McTaggart, Bob

  Wareing, Robert N.

  Madden, Max

  Welsh, Andrew (Angus E)

  Maginnis, Ken

  Welsh, Michael (Doncaster N)

  Marek, Dr John

  Wilson, Brian

  Marshall, Jim (Leicester S)

  Winnick, David

  Martin, Michael J. (Springburn)

  Worthington, Tony

  Martlew, Eric

  Wray, Jimmy

  Maxton, John

  Young, David (Bolton SE)

  Meale, Alan

  Michie, Bill (Sheffield Heeley)

  Tellers for the Ayes:

  Millan, Rt Hon Bruce

  Mr. Frank Haynes and

  Moonie, Dr Lewis

  Mr. Ken Eastham.

  Morgan, Rhodri

  NOES

  Aitken, Jonathan

  Brooke, Rt Hon Peter

  Alexander, Richard

  Burt, Alistair

  Alison, Rt Hon Michael

  Butler, Chris

  Arbuthnot, James

  Butterfill, John

  Arnold, Jacques (Gravesham)

  Carlisle, John, (Luton N)

  Atkinson, David

  Carlisle, Kenneth (Lincoln)

  Baker, Rt Hon K. (Mole Valley)

  Carrington, Matthew

  Baker, Nicholas (Dorset N)

  Cash, William

  Banks, Robert (Harrogate)

  Channon, Rt Hon Paul

  Bennett, Nicholas (Pembroke)

  Chapman, Sydney

  Biffen, Rt Hon John

  Chope, Christopher

  Biggs-Davison, Sir John

  Churchill, Mr

  Body, Sir Richard

  Clark, Sir W. (Croydon S)

  Boscawen, Hon Robert

  Clarke, Rt Hon K. (Rushcliffe)

  Boswell, Tim

  Conway, Derek

  Bottomley, Mrs Virginia

  Coombs, Anthony (Wyre F'rest)

  Bowis, John

  Cope, John

  Braine, Rt Hon Sir Bernard

  Cormack, Patrick

  Bright, Graham

  Cran, James

  1153

  Currie, Mrs Edwina

  Hicks, Robert (Cornwall SE)

  Curry, David

  Higgins, Rt Hon Terence L.

  Davies, Q. (Stamf'd & Spald'g)

  Hill, James

  Davis, David (Boothferry)

  Hind, Kenneth

  Dickens, Geoffrey

  Hogg, Hon Douglas (Gr'th'm)

  Dorrell, Stephen

  Holt, Richard

  Douglas-Hamilton, Lord James

  Howard, Michael

  Dover, Den

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

  Dunn, Bob

  Howarth, G. (Cannock & B'wd)

  Durant, Tony

  Howell, Ralph (North Norfolk)

  Dykes, Hugh

  Hughes, Robert G. (Harrow W)

  Eggar, Tim

  Hunt, David (Wirral W)

  Emery, Sir Peter

  Hunt, John (Ravensbourne)

  Evans, David (Welwyn Hatf'd)

  Hunter, Andrew

  Evennett, David

  Hurd, Rt Hon Douglas

  Farr, Sir John

  Irvine, Michael

  Favell, Tony

  Irving, Charles

  Fenner, Dame Peggy

  Jack, Michael

  Field, Barry (Isle of Wight)

  Janman, Tim

  Finsberg, Sir Geoffrey

  Johnson Smith, Sir Geoffrey

  Fookes, Miss Janet

  Jones, Gwilym (Cardiff N)

  Forsyth, Michael (Stirling)

  Jones, Robert B (Herts W)

  Forth, Eric

  Jopling, Rt Hon Michael

  Fowler, Rt Hon Norman

  Key, Robert

  Fox, Sir Marcus

  Kirkhope, Timothy

  Franks, Cecil

  Knapman, Roger

  Freeman, Roger

  Knight, Greg (Derby North)

  French, Douglas

  Knight, Dame Jill (Edgbaston)

  Gale, Roger

  Knowles, Michael

  Gardiner, George

  Knox, David

  Garel-Jones, Tristan

  Lamont, Rt Hon Norman

  Gilmour, Rt Hon Sir Ian

  Lang, Ian

  Goodhart, Sir Philip

  Lawrence, Ivan

  Goodlad, Alastair

  Lawson, Rt Hon Nigel

  Goodson-Wickes, Dr Charles

  Lennox-Boyd, Hon Mark

  Gorst, John

  Lilley, Peter

  Gow, Ian

  Lloyd, Sir Ian (Havant)

  Gower, Sir Raymond

  Luce, Rt Hon Richard

  Grant, Sir Anthony (CambsSW)

  Lyell, Sir Nicholas

  Greenway, Harry (Eating N)

  McCrindle, Robert

  Greenway, John (Ryedale)

  Macfarlane, Sir Neil

  Gregory, Conal

  MacGregor, Rt Hon John

  Griffiths, Sir Eldon (Bury St E')

  MacKay, Andrew (E Berkshire)

  Griffiths, Peter (Portsmouth N)

  Maclean, David

  Grist, Ian

  McLoughlin, Patrick

  Ground, Patrick

  McNair-Wilson, M. (Newbury)

  Grylls, Michael

  McNair-Wilson, P. (New Forest)

  Gummer, Rt Hon John Selwyn

  Madel, David

  Hamilton, Hon Archie (Epsom)

  Major, Rt Hon John

  Hamilton, Neil (Tatton)

  Malins, Humfrey

  Hampson, Dr Keith

  Mans, Keith

  Hanley, Jeremy

  Marland, Paul

  Hannam, John

  Marshall, Michael (Arundel)

  Hargreaves, A. (B'ham H'll Gr')

  Martin, David (Portsmouth S)

  Hargreaves, Ken (Hyndburn)

  Mates, Michael

  Harris, David

  Mawhinney, Dr Brian

  Haselhurst, Alan

  Maxwell-Hyslop, Robin

  Hawkins, Christopher

  Mayhew, Rt Hon Sir Patrick

  Hayes, Jerry

  Meyer, Sir Anthony

  Hayhoe, Rt Hon Sir Barney

  Miller, Hal

  Hayward, Robert

  Mills, Iain

  Heathcoat-Amory, David

  Miscampbell, Norman

  Heddle, John

  Mitchell, Andrew (Gedling)

  Heseltine, Rt Hon Michael

  Moate, Roger

  1154

  Monro, Sir Hector

  Speed, Keith

  Montgomery, Sir Fergus

  Speller, Tony

  Morris, M (N'hampton S)

  Spicer, Michael (S Worcs)

  Morrison, Hon Sir Charles

  Squire, Robin

  Morrison, Hon P (Chester)

  Stanbrook, Ivor

  Moss, Malcolm

  Stanley, Rt Hon John

  Neale, Gerrard

  Steen, Anthony

  Nelson, Anthony

  Stern, Michael

  Neubert, Michael

  Stevens, Lewis

  Nicholson, David (Taunton)

  Stewart, Andy (Sherwood)

  Nicholson, Emma (Devon West)

  Stradling Thomas, Sir John

  Onslow, Rt Hon Cranley

  Summerson, Hugo

  Oppenheim, Phillip

  Taylor, John M (Solihull)

  Page, Richard

  Taylor, Teddy (S'end E)

  Patnick, Irvine

  Temple-Morris, Peter

  Patten, Chris (Bath)

  Thompson, D. (Calder Valley)

  Pattie, Rt Hon Sir Geoffrey

  Thompson, Patrick (Norwich N)

  Pawsey, James

  Thornton, Malcolm

  Peacock, Mrs Elizabeth

  Thurnham, Peter

  Porter, David (Waveney)

  Townend, John (Bridlington)

  Portillo, Michael

  Tracey, Richard

  Powell, William (Corby)

  Tredinnick, David

  Price, Sir David

  Trippier, David

  Raison, Rt Hon Timothy

  Twinn, Dr Ian

  Rathbone, Tim

  Vaughan, Sir Gerard

  Redwood, John

  Viggers, Peter

  Renton, Tim

  Waddington, Rt Hon David

  Rhodes James, Robert

  Waldegrave, Hon William

  Ridley, Rt Hon Nicholas

  Walden, George

  Ridsdale, Sir Julian

  Walker, Bill (T'side North)

  Rifkind, Rt Hon Malcolm

  Walters, Dennis

  Roe, Mrs Marion

  Ward, John

  Rossi, Sir Hugh

  Wardle, Charles (Bexhill)

  Rost, Peter

  Warren, Kenneth

  Rowe, Andrew

  Watts, John

  Rumbold, Mrs Angela

  Wheeler, John

  Ryder, Richard

  Widdecombe, Ann

  Sackville, Hon Tom

  Wiggin, Jerry

  Sainsbury, Hon Tim

  Wilkinson, John

  Shaw, David (Dover)

  Wilshire, David

  Shaw, Sir Giles (Pudsey)

  Winterton, Mrs Ann

  Shaw, Sir Michael (Scarb')

  Winterton, Nicholas

  Shelton, William (Streatham)

  Wood, Timothy

  Shephard, Mrs G. (Norfolk SW)

  Woodcock, Mike

  Shepherd, Richard (Aldridge)

  Young, Sir George (Acton)

  Shersby, Michael

  Sims, Roger

  Tellers for the Noes:

  Skeet, Sir Trevor

  Mr. Peter Lloyd and

  Smith, Tim (Beaconsfield)

  Mr. David Lightbown.

  Soames, Hon Nicholas

  Question accordingly negatived.
  Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments), and agreed to.
  MR. SPEAKER forthwith declared the main Question, as amended, to be agreed to.
  Resolved,
  That this House recognises the support that Her Majesty's Government has given to the shipbuilding industry; and welcomes the prospect of returning British Shipbuilders' yards to the private sector.

European Community (Finance)
Mr. Speaker: I must announce to the House that I have selected the amendment in the name of the Leader of the Opposition.
7.13 pm
The Paymaster General (Mr. Peter Brooke): I beg to move,
That this House takes note of European Community Documents Nos. 10552/86 and the un-numbered Explanatory Memorandum submitted by the Treasury on 18th March 1987 on the 1987 Community Budget, the un-numbered Explanatory Memorandum submitted by the Treasury on 18th March 1987 on carry-over of appropriations from 1986 to 1987, 6037/87 on the 1987 Budget situation, 6822/87 and 7552/87 on Supplementary and Amending Budget No. 1 for 1987, 6048/87, 7211/87, COM(87)240, COM(87)677 and COM(88)81 on the 1988 Preliminary Draft Budget, 4766/88 on the 1988 Draft Budget, 4051/87 on financial engineering, 5266/88 on Own Resources, 5282/88 on amendments to the Financial Regulation and the un-numbered Explanatory Memorandum submitted by the Treasury on 10th May 1988 on budgetary discipline; and endorses the Government's objectives of securing effective and binding control of Community expenditure.
I am delighted that the House has the opportunity this evening to debate the unfinished business of the Brussels European Council and the 1988 Community budget, ahead of the decisions which the Council of Ministers and the European Parliament are likely to reach over the next month or so.
The motion mentions a number of documents, deposited with the House, which the Scrutiny Committee has recommended for debate. I pay tribute to the Scrutiny Committee for its clear, concise and conscientious reports on these documents. I pay tribute also to the Treasury and Civil Service Committee, which has been monitoring developments in Brussels with all the diligence and understanding that we have come to expect from that Committee.
Mr. Teddy Taylor: As my right hon. Friend said that the Council and the Parliament are likely to agree these matters within a month, will he explain how that is possible under article 199, when this Parliament and other Parliaments have not approved the increase in resources that would match the expenditure under article 199?
Mr. Brooke: If my hon. Friend will be content to know that I was going to deal with those matters at some length, it might be more sensible if I took them in logical order.
The House may find it helpful if I begin by saying a little about the likely timetable of events in Brussels, the Community's financing needs and the procedures for obtaining Parliament's approval for the Community's new own resources decisions and the 1988 intergovernmental agreement, or IGA. The House may like to be reminded that the Heads of Government agreed at the Brussels European Council in February on a new own resources ceiling and system for the Community. They also agreed that it should take effect for the current year by means of an agreement between the member states that they will provide supplementary contributions to the 1988 Community budget in the form of non-reimbursable advances against the newly agreed own resources, pending ratification of the new own resources decision.
1156
To begin then, with the likely timetable, we learned from Strasbourg last night that the European Parliament had reached agreement with the President of the Budget Council on the 1988 Community budget, though it is not yet clear whether the President of the Parliament, Lord Plumb, will declare the budget adopted until final agreement has been reached on the other unfinished business of the Brussels European Council.
The Community has still to reach final agreement on all the other main documents implementing the European Council conclusions, including the new decisions on own resources and budget discipline and the 1988 IGA. Also unfinished are the negotiations with the European Parliament on an inter-institutional agreement about implementation of the Community's expenditure policies over the next five years. There now seems a good chance that all this unfinished business will be resolved over the next three or four weeks, but I cannot, of course promise the House that that timetable will be fulfilled.
If I may turn next to the Community's financing needs and the question of seeking the House's approval for the Community's new financing agreements, I want to say first that the Government will not pay any contribution to the Community under the new own resources decision or the intergovernmental agreement until the House has signified its approval. I have made that point already to the Treasury and Civil Service Committee, and I am glad to repeat it in the House now.
The Commission will, however, have an urgent cash-flow problem over the next few weeks. It has calculated that this will arise in any case as a result of the Community's existing obligations, whether the 1988 budget is formally adopted or not. The cash requirement has nothing to do with adoption of the budget or the IGA, but simply reflects the fact that the level of spending to which the Community is committed, in particular on agriculture, is running faster than the limited revenues which are available, month by month, under the present provisional twelfths regime. Earlier in the year the Commission's cash position was strong and this enabled it to make ends meet. This month, however, it has had to call for an advance payment of traditional own resources under article 10(2) of regulation 2891/77. I shall be providing details of this in a written answer tomorrow.
Mr. Eric Forth: The House might be slightly puzzled, as I confess to being, at hearing my right hon. Friend say that there are problems of expenditure outrunning resources. My right hon. Friend will recall that when Fontainebleau was concluded we were told that effective measures had been put in place to control expenditure. If I am not mistaken, we shall probably be told something similar in a few moments. How can my right hon. Friend square the fact that the Parliament and the Community have run out of money and are in crisis with the fact that Fontainebleau was supposed to provide the answers some two or three years ago?
Mr. Brooke: My hon. Friend will be familiar with the answer. In the current year the Community is operating on provisional twelfths. Provisional twelfths quite clearly do not represent the level of resources that would otherwise have been adopted, because no budget has been adopted. That is why the Commission has a cash flow problem.
Mr. Terence L. Higgins: Is it quite accurate for my right hon. Friend to say that the Commission has a cash flow problem? Would I be wrong in supposing that if the House does not agree to an IGA or to the increase in own resources, the Commission does not have a cash flow problem; it quite simply does not have the money?
Mr. Brooke: The provisional twelfths amounts come through on a monthly basis. It is a current month problem that the Commission has asked us to address. The nature of a 10(2) overdraft request is simply to ask for own resources to be brought forward and to be paid at a slightly earlier date than they otherwise would be.
Mr. Nigel Spearing: I am grateful to the right hon. Gentleman for giving way at this point, because it helps to bring about a rational debate. He may have said something that he did not intend. He said that the new IGA would not be approved by the Government unless it had been endorsed by the House. That has to happen through a Bill or an Estimate. Can he assure the House that the Government would not assent to that in the initial stages, before it was endorsed by the House, unless and until there had been agreement in the institutions of the EEC to the British rebate formula and the disciplinary documents? Surely the former depends upon the acceptance of the latter.
Mr. Brooke: The hon. Gentleman is perfectly correct in identifying that as a subject that came up when I gave evidence to the Treasury and Civil Sevice Select Committee last week. If the hon. Gentleman will bear with me I shall come to the issue and deal with it within the logical framework of my speech.
Next month the Commission expects to have to call for overdraft facilities under article 12(2) of the same regulation, although on a much smaller scale than would be implied by a six-monthly slice of IGA contribution.
When the 1988 budget is finally adopted, the Commission will need further funding without too much delay to enable it to fulfil its responsibility to implement the budget. It has suggested that it is likely to call up contributions from member states in the form of IGA contributions or of overdraft advances under article 12(2) of the regulation to which I have referred, depending on what has been agreed in the Council and what is possible for the member state concerned. Initially, these requests for the funds will be needed to cover cash flow requirements which would have arisen in any case. The IGA cannot be finally crystallised until we have agreement on all the relevant provisions of the Community's new own resources decision, including the United Kingdom abatement provisions.
Member states are obliged to comply with overdraft requests by the Commission under article 12(2) of the regulation, provided that these are genuinely needed to cover a prospective cash deficit, and provided that they would not involve exceeding the own resources known to be available for the year. The Government stand ready, therefore, to meet such overdraft requests, before or after adoption of the budget, and before or after final agreement on the IGA, provided that these conditions are fulfilled. We would charge such overdrafts directly against the Consolidated Fund, like all other Community obligations, while keeping the House fully informed. The Government would not, however, intend to meet demands for overdraft contributions, to the extent that these were in effect
1158
requests for IGA contributions, without first seeking the House's approval for the necessary supplementary financing.
As we cannot be sure when the supplementary financing will first be needed, we may well find that we have to seek Parliament's approval on a somewhat accelerated timetable, though the overdraft facility will continue to be available in the way that I have described. If that happens, I am sure that the House will understand the reasons why.
As to the means by which Parliament's approval will be sought, there are in principle two main options. One will be to seek approval my means of a composite Bill, covering both the new own resources decision and the IGA. This would follow the precedent of the European Communities (Finance) Act 1985. The Bill would be introduced as soon as possible after the IGA and the new own resources decision have been formally agreed and the 1988 budget adopted. The initial instalment or instalments of the IGA would be financed as necessary from the Contingencies Fund if and when Parliament has given the Bill a Second Reading.
The other option would be to decouple the own resources decision and the IGA. On this approach we would seek approval for the own resources decision through a Bill while separately presenting a special Estimate and Consolidated Fund Bill to cover our IGA contributions. The procedure for approval of the 1984 IGA would provide a precedent for that.
I imagine that most hon. Members would feel, as I do, that the composite Bill approach would be preferable to the decoupled approach.—[HON. MEMBERS: "No."] I shall stick by the observation I have made. If hon. Members wish to disagree during the debate, I shall look forward to replying later.
Mr. Spearing: This is a Committee-style exchange because Committee-style detail is required. Surely the right hon. Gentleman appreciates that the IGA is outside the treaties and is an agreement between Governments not within the treaty of Rome. The draft decision, which has also to be ratified by the House and which has not yet been completed in Brussels, will have to be ratified to cover the new financial structure for the next five years. Surely it would be quite wrong to put the two together—one intra-treaty and one extra-treaty—in the same piece of legislation.
Mr. Brooke: I have offended the purist instincts of the House in suggesting that they should be taken together. I did not hold the office for which I am currently responsible during 1984 and 1985. My understanding of the affairs of that time was that Parliament in general, and the Treasury and Civil Service Select Committee in particular, had shown a preference for the linked approach and the composite Bill. It is the case—I am now referring to Parliament's convenience—that one would be taking through the entire complicated matter in a single tranche rather than as separate measures. No doubt other hon. Members who registered a negative a moment ago will want to enlarge on that when they speak.
The final choice will have to depend on the timing of agreement in Brussels on the various elements in the total package. If the final agreement on the own resources decision, or even on the IGA, should be delayed, the composite Bill route might not be available and, as I

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understand it, would not be to the liking of the hon. Member for Newham, South (Mr. Spearing). Decoupling might then be the only solution.
Before leaving this important subject I should emphasise again that the timetable in Brussels remains uncertain and we do not yet have final decisions on how the Commission will handle these somewhat complicated financing issues. The Government's own proposals on procedure must likewise, therefore, remain provisional for the time being. I shall keep the House informed about developments.
The documents that appear in today's motion fall into four categories: documents relating to the 1987 and 1988 budgets; a document on the Community's "financial engineering" proposals; the Commission's proposal for a new own resources decision; and documents on budget discipline and management.
With the House's permission, I shall say a few words about each of those subjects. First, I shall deal with the 1988 budget. The documents in today's motion have been largely overtaken by the developments in Strasbourg last night. which I mentioned earlier. Although precise details are not yet clear, it seems that the European Parliament voted yesterday evening to reinstate all its first reading budget proposals, thus creating, on present indications, an excess of 200 mecu in commitments over the statutory margin that the treaty allows the Parliament to add to the Council's proposals for non-obligatory expenditure, while using up all the margin for payments.
In response to this, the President of the Budget Council announced that he had authority from the Budget Council to negotiate a new maximum rate of increase for commitments and would therefore agree to the Parliament's proposals on the Council's behalf. The result is that we now have agreement between the Council and the Parliament on the 1988 budget.
It remains uncertain when the President of the Parliament, Lord Plumb, will declare the budget adopted. He said last night that he would take time to consider—
Mr. Stuart Holland: I hesitated for a moment before pointing this out, but I think the right hon. Gentleman will find that he has already made these points to the House this evening.
Mr. Brooke: I will, if I may, continue my speech.
Mr. David Curry: I wonder whether it would assist the House if I told my right hon. Friend what happened in the European Parliament yesterday, because I was there. The Parliament voted through a budget that went beyond what the Council regards as the margin of commitments and the President of the Council, Mr. Tietmeyer, signalled his consent to that higher amount by fixing a new maximum rate. Therefore, the situation is that the budget is now in a condition to be signed by the President of the Parliament. He has said that he will sign the budget after he has studied it, and the event upon which he is waiting is the next round of discussions on the inter-institutional agreement, to which my right hon. Friend referred, and which represents the Parliament's desire to be associated with the longer-term framework of budgetary discipline over a five-year period. What has not yet happened, as my right hon. Friend said, is any vote in the Parliament on the financial regulation or the own resources decision.
Mr. Brooke: By some process of serendipity, my hon. Friend has anticipated with absolute precision the remarks that I was about to make. I shall enlarge upon what I said earlier about Lord Plumb before the hon. Member for Vauxhall (Mr. Holland) intervened.
Lord Plumb said last night, as my hon. Friend the Member for Skipton and Ripon (Mr. Curry) mentioned, that he would take time to consider whether the budget had a secure revenue base, and also the state of play on the inter-institutional agreement about the development of the Community's programmes over the next five years, which the Council and the Parliament are trying to negotiate. Some members of the Parliament are arguing that, in the absense of agreement on the new own resources decision and the IGA, the budget has no secure revenue base. We have considerable sympathy with that view. The decision, however, is for Lord Plumb. Here, too, I undertake to keep the House informed about developments.
As to the magnitudes involved, we do not yet have the detailed figures from Strasbourg. Our own provisional calculations suggest, however, that the budget as now agreed will provide for total commitment appropriations of 45·3 becu and total payment appropriations of 43·8 becu. Compared with the final budget for 1987, the percentage increases are 20·9 per cent. for commitments and 21 per cent. for payments.
Within the totals, the level of agricultural guarantee expenditure is exactly as agreed at the Brussels European Council. The percentage increase in non-obligatory payments is 9·5 per cent.
Mr. Ron Leighton: I am trying to understand what is going on. It seems that we are in a rather humiliating position in that we do not know what we have to pay. All we know is that it is continually more each year and each time the Paymaster comes along. That is a singularly appropriate nomenclature. He is the paymaster of the Common Market. Whatever it says we have to pay, he coughs up the money. He is not sure what we have to pay, but we have a helpful intervention from a member of a slightly alien institution who gives him helpful advice as to how much we have to pay. Whatever it is, he gives us the bill and we pay it. Is that what the British Parliament has come to?
Mr. Brooke: If the hon. Gentleman will excuse me, I think that that was a largely rhetorical intervention. I can assure him that when I became Paymaster General I informed my friends in the Budget Council that my attitude towards them had not changed at all and that my title did not indicate any change in my attitude.
I was referring to the level of agricultural guarantee expenditure. The increase in non-obligatory payments is 9·5 per cent. This, too, is broadly in line with the level of expenditure envisaged at the Brussels European Council, although the increase of 12·6 per cent., in non-obligatory commitments is somewhat higher than I would have wished. I argued at the last Budget Council, with French support, that the Council should not agree to any excess over the statutory margin which the Parliament is entitled to add to the Council's non-obligatory expenditure proposals. The prevailing view was, however, that the President of the Council should have a certain flexibility to negotiate with the European Parliament.
I turn briefly to the document on the Order Paper, No. 4051/87, which introduces the Commission's ideas on

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financial engineering. "Financial engineering" is a term of art in the Community—if art is the right word—which refers to the mobilisation of funding for investment. The Government share the Commission's views on the importance of the spirit of enterprise, the working of market forces and productive investment.
We are not convinced, however, that new Community funding mechanisms are necessary. In most of the Community countries we already have highly developed private sector mechanisms for funding investment programmes, and the Community itself already has a major institution, the European Investment Bank, for the funding of investment projects in Europe. The member states will no doubt wish to examine the Commission's idea carefully with these points in mind.
Mr. Curry: Does my right hon. Friend agree that if the British Government's ideas on reducing the number of commissioners had been adopted, so that there was one per country, we might have rather fewer policies, because it would not be necessary to find policies for every commissioner to manage?
Mr. Brooke: I am familiar with the application of Parkinson's law in all areas of human endeavour, and in the Commission in particular.
Mr. Teddy Taylor: Before my right hon. Friend leaves document COM(87)150, as he has referred to the percentage increase in agriculture, could he explain why on page 16 of that document, which seems to be the fundamental page setting out the figures, according to the Commission and according to those who published it, there is a proposal to increase expenditure on agriculture by 16·03 per cent., and not the figure that he mentioned, particularly as this seems to be an extravagant figure well beyond what was mentioned in his speech or in the discussions in the European Council?
Mr. Brooke: As that is a rather detailed statistical point and I do not have the document readily at hand, I shall respond to my hon. Friend at the close of the debate.
I turn now to the new own resources decision. Document 5266/88 in the motion contains the Commission's proposal for this important new decision, which the Council and official Committees in Brussels have been debating for several weeks. The purpose of the new decision is to give effect to the agreements on own resources which the Heads of Government reached in February at the Brussels European Council. In keeping with this, the decision provides for: a new own resources ceiling of 1·2 per cent. of the Community's GNP, with a corresponding 1·3 per cent. of GNP ceiling on commitment appropriations; limitation of VAT contributions to 1·4 per cent. of the VAT base, which is similar to consumer expenditure; a redefinition of the VAT base, known as "capping", such that in future the assessable VAT base of each individual member state may no longer exceed 55 per cent. of its GNP; the introduction of a fourth own resource, based on GNP shares, which will take its place alongside the existing levies and duties and VAT own resources and serve as the Community's residual source of finance; and new provisions to ensure that the Fontainebleau abatement system for the United Kingdom remains intact within the new system of own resources.
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For the United Kingdom the effect of these provisions wil be that for any given level of the Community budget our gross contribution will be lower in the first instance than under the existing own resources system, because of the provisions for VAT capping and the new fourth resource; but we shall receive correspondingly less abatement in the following year. The overall effect on the United Kingdom will thus be neutral, except that there will be a timing advantage.
The Commission's draft of the own resources decision makes no provision for sub-ceilings on own resources: that is to say, intermediate own resources ceilings for the years between now and 1992 below the overall 1·2 per cent. of GNP ceiling. However, the Brussels European Council made explicit provision for such sub-ceilings and the Council has been considering how they should be incorporated within the own resources decision.
There are, in addition, certain other arguments over the text of the own resources decision which have still to be resolved in the Council. The largest of these is the so-called Italian problem. The Italians claim that the Commission's proposals for financing the United Kingdom abatement will result in too much of the budget being financed from the new fourth resource and too little from VAT own resources. Since the Italians' share of the Community's GNP is considerably larger than their share of the Community's VAT base, the Italians would be better off under a different system, which provided for more VAT and less GNP-shared financing.
We remain hopeful that these and other problems will be finally settled over the next two or three weeks. The Government have, however, made clear throughout that the United Kingdom will not finally and formally agree in the Council to the new own resources decision until there has been agreement to the other elements in the Brussels package, notably the decision on budget descipline.
The last two papers listed in the motion deal with the important subjects of budget discipline and management. On budget management, the Commission proposal in document 5282/88 for amendments to Community's financial regulations is concerned with giving legal force to changes for which the United Kingdom pressed hard in the future financing negotiations. The first is a provision whereby the traditional Community practice of carrying over unused budget appropriations from one year to the next should become the exception rather than the rule. The second is a provision limiting any negative reserves which may be entered into the budget to 200 mecu.
So far as budget discipline is concerned, the explanatory memorandum, which is the last document listed in the motion, summarises the proposal for a council decision on budget discipline for obligatory expenditure, and in particular for agricultural guarantee expenditure. As hon. Members will recall, the United Kingdom fought long and hard in the months before the Brussels European Council for improved discipline over agricultural spending. That is reflected in the draft decision.
As I explained to the Treasury and Civil Service Committee last week, there are five critical areas in which the controls on agricultural spending have been strengthened. First, the guideline limit for this spending will in future be enshrined in a legal instrument which will be binding on the Council.
Secondly, the notorious provision in the 1984 budget discipline conclusions for exceeding the guideline in "exceptional circumstances" has been scrapped. In its

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place we are to have a symmetrical monetary reserve arrangement to deal with the budgetary effects of substantial movements in the ecu/dollar exchange rate in either direction within a limit of 1 becu a year.
Thirdly, the Commission has undertaken to put forward price proposals which are consistent with the guideline limit; to insist on a joint meeting of Finance Ministers and Agriculture Ministers if the latter seem likely to take decisions which would involve exceeding the expenditure implied by the Commission's original proposals; and to manage the agricultural budget chapter by chapter—or, in other words, major commodity by major commodity—not globally as in the past. The Commission has undertaken to monitor expenditure and take remedial action if it threatens to exceed the budgetary provision, either by using its own management powers or by making proposals to the Council on which the Council will be committed to act within two months.
Fourthly, the instruments for controlling spending on individual commodities have been greatly strengthened by the introduction of automatic stabiliser mechanisms in all the main product regimes.
Finally, there are new arrangements for systematic depreciation of new agricultural stocks, with special provision earmarked for the cost of depreciating existing stocks.
Mr. Forth: My right hon. Friend was not in his present position at the time of Fontainebleau, and cannot therefore take any credit for it, but having looked back at it and at what was said in the House after it, when a number of us were accused of being unhelpful and cynical for suggesting that Fontainebleau was not all that it had been cracked up to be, will he assure me that he and our right hon. Friend the Chancellor of the Exchequer are satisfied that we have got it right this time? By conceding an interest in the Community's resources, will we get the effective discipline that we emphatically did not get after Fontainebleau?
Mr. Brooke: I assure my hon. Friend that the narrative of the Fountainebleau debates is well known to me, and I am aware that several of my hon. Friends made such comments at the time. The position today is greatly improved, but my hon. Friend and I belong to a party that has always believed that this is an imperfect world, so I cannot promise him everything.
Mr. Curry: Does my right hon. Friend accept that one of the important things that has happened since Fontainebleau in the changing budgetary arithmetic of the Community is that France is moving into the position of being a net contributor rather than a recipient and so has a greater vested interest in the control of expenditure? Equally, Spain stands to make no great gain out of agriculture and therefore has an interest in limiting agricultural spending to create resources for the funds from which she would benefit. Is that geographic change not as politically important as formal guarantees about agricultural expenditure in determining what happens?
Mr. Brooke: I am grateful for my hon. Friend's comment, although some of it might have come in a speech at a later stage. On the first day of the international cricket season, I have no desire to bat all day and I shall seek now to bring my speech to an end.
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For non-obligatory expenditure, there appears to be no scope for a legal instrument, based on treaty, comparable to that proposed for obligatory expenditure. The problem is that such an instrument would fetter powers which the treaty itself confers on the Parliament. The Brussels European Council agreed accordingly to seek an inter-institutional agreement with the Parliament over the development of non-obligatory expenditure during the next five years and, failing such agreement, to adopt on its own initiative internal rules for restraining the growth of such expenditure.
The Council's proposals, which were enshrined in the Brussels European Council conclusions, provide for specific additions each year to commitments for the structural funds, confirmation of existing multi-annual commitments for research and development and integrated Mediterranean programmes, and containment of commitment appropriations for the rest of non-obligatory expenditure within the statistical maximum rate of increase laid down in the treaty.
Although the provisions for budget discipline over non-obligatory expenditure cannot be enshrined in a legal instrument of the same kind as for obligatory expenditure, the political commitment to this element in budget discipline is every bit as binding as for agricultural expenditure. In addition, the sub-ceilings on own resources which I mentioned earlier, taken together with the guideline limit on agricultural guarantee expenditure, will indirectly provide an overall and binding limit on the scope for increases in non-obligatory expenditure.
I apologise if this speech has been a little protracted by interventions. Some hon. Members may feel that I have raced with indecent haste through a labyrinth of complex issues. If they do, I ask their forgiveness. The Government will continue their efforts to put the Community's finances on a sound basis, and we hope that hon. Members of all parties will support us in that.
7.47 pm
Mr. Stuart Holland: I beg to move, to leave out from "discipline" to the end of the Question and to add instead thereof:
'views with concern the proposals of government to conclude an agreement to provide payments to the European Community prior to final adoption of instruments authorising own new resources and discipline; and calls on Her Majesty's Government to give notice to the Council of Ministers that its agreement to the draft budget and the proposals for own resources is dependent on rapid agreement on new financial disciplines, particularly those related to the Common Agricultural Policy, and on the formula for the United Kingdom rebate as agreed at the last European Council in Brussels, on adoption of a genuine and expeditious programme for a substantial reduction of Common Agricultural Policy spending, on a corresponding increase in other budget allocations, not only for the social regional funds, but also for the environment, and for assistance to developing countries, on recognition that a harmonisation of VAT rates is not necessary for achievement of a common internal market by 1992, on international governmental action for a recovery of employment, income and trade in the Community, including re-establishment of a major role for the Medium Term Economic Policy Committee, and on new accounting procedures to gain transparency on the market behaviour and abuse of dominant positions by bigger business in the Community.'
Some things bear repetition—music is a case in point—and I must repeat that the Government's record of failure in the matter of budget and own resources is deplorable by the standards that they have set themselves.

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I am sure that we shall shortly benefit from a contribution by the right hon. Member for Worthing (Mr. Higgins) who, in the Treasury and Civil Service Select Committee on 11 May, put the following question to the Paymaster
General:
"We were told some years ago, were we not, when the original budgetary package on this came through, that the proportion spent on agriculture would fall?"
The Paymaster General replied:
"I think it is a matter of common knowledge between us that the arrangements which were secured in 1984 for the restraining of agricultural expenditure were not as effective as they should have been."
That, I suggest, is the understatement of the month.
In the same Select Committee—in passing, I congratulate it on the work that it has done—the right hon. Member for Worthing said:
"If we go, as the Michelin Guide would say, for a little history, the Government's position originally was that there would be effective budget discipline. This Committee at that time expressed extreme scepticism as to whether that would be effective. That indeed turned out to be the case: that it was not effective. We were then told by the Prime Minister that she would not go along with any further arrangements for increasing own resources until the whole thing was tied up in a legally binding way. I do not recollect her saying 'except for non-obligatory expenditure.'"
This is typical of the overruns that we have had time and again in the Community. It is clear that Fontainebleau has not stuck and that the fundamental problems have not been resolved. The overwhelming share of the overruns will still go to agriculture, although a sizeable share goes to the regional fund. The situation is clearly out of hand.
Mr. Curry: The general secretary of the Labour party was in Strasbourg earlier this week. Did the general secretary advise the members of the British Labour group to vote against the increase in non-obligatory expenditure in the budget?
Mr. Holland: That is a fascinating intervention. I have not spoken to the general secretary of the Labour party
since he was in Strasbourg. There will be a vote in the House tonight. If the hon. Gentleman cares to pay attention, as I am sure he will, to what I am saying or to the terms of the amendment, he will see that the amendment is constructive. It proposes that the framework of expenditure in the Community could well be put to useful purposes. That is not happening at present because the common agricultural policy is simply out of control.
One of the reasons for that is precisely the whole strategy adopted by the Government towards the budget. It is common knowledge that in an exchange between the then Prime Minister of France and our Prime Minister at the last summit an untranslatable French word employed by the French Prime Minister provoked a response from our Prime Minister. I am perfectly aware of what the word means and the hon. Member for Skipton and Ripon (Mr. Curry) may also know what it means. I do not propose to translate it here.
Governments of the Left, Right or Centre in the European Community are sick and tired of this Government approaching the question of the budget only in terms of the rebate. The rebate is very important, as my hon. Friends will quite rightly stress, but the Government have failed to adopt a constructive attitude towards what
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the Community might well do in common in a range of areas where the budget is allocating funds between and within member states.
It is quite clear that we need a square deal from the Common Market. All hon. Members agree on that. We also need a new deal from the European Community. We need a new deal for Europe that will enable us to address matters of urgent and pressing importance affecting our joint economies. We need to be able to address the role that Europe plays in the OECD and the kind of economic difficulties into which the world economy is moving with, for example, the potential slowing down of the United States economy. We should be able to address the question of target exchange rates and the attitude of the Government and other Governments towards the European monetary system. These matters very much affect the feasible kinds of expenditure that can be undertaken by member states and not simply by the budget itself.
Our amendment stresses that there should be a substantial reduction in spending on the common agricultural policy and not just a slowing in the rate of increase of CAP spending. There should be a corresponding increase not only in the social and regional funds, but in spending on the environment and on assistance to developing countries.
Mr. Teddy Taylor: The hon. Gentleman said that there will be a slowing down of the rate of increase in agricultural spending. Can he find anywhere in the mountain of documents with which we have been supplied any evidence that there will be a slowing down in the rate of that increase?
Mr. Holland: No; and one of the points that I shall deal with in summing up is that the stabilisers appear to be not declining but inclining and that we are not actually getting the reduction that we should be getting.
The budget, the "take note" motion before the House and the documents to which it refers cover the social and regional funds, the environment and, as it happens, assistance to developing countries. These are all brought within the terms of reference of the Commission's consultative document 4051/87 which is referred to on the Order Paper and in the Commission's document as "financial engineering." I have not had a chance to consult whoever is responsible for translating this document either in the Commission or in the Foreign Office. Financial engineering is not at all what the document is about. That suggests to me that whoever found the French term for financial mechanisms translated it into the English equivalent of mechanique, which is engineering. This document is not about engineering in any way; it is about financial mechanisms.
When the Paymaster General gets to his feet and says, "We have considered this document and looked in depth at all the proposals that it makes on a range of issues," I have to ask the House whether that can possibly be the case when the very title of the document makes no sense whatever. Financial engineering there may be in the European Community or in the common agricultural policy, but that is clearly not the intent of the document. Moreover, the document contains many useful proposals on the renewal and strengthening of industry and the

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industrial base in the Community and on the very imaginative possibility of joint ventures with, for example, developing countries.
The Paymaster General says that there is no evidence of a gap. The Treasury memorandum says:
"The Commission assumes, but does not demonstrate, that there are gaps in the financing of viable projects left by the private market."
This is yet another area, as on the budget rebate, that preoccupied the whole summit agenda and on which the Government are totally out of step with every other Government in the Community. All those Governments have medium to long-term credit institutions and regional development agencies focused especially on the promotion of small and medium enterprises, precisely because they recognise, as did the Macmillan report in the 1930s in this country, that there is a financing gap for small and medium firms because they face problems in raising funds on equal terms with larger businesses. Larger firms have a larger volume of borrowing, so they gain lower interest rates.
Therefore, intervening in the market to give, for example, an interest rate advantage in regional or structural funds to small and medium firms is not a distortion of the market but an equalisation of competition in the market. However, I do not expect the Paymaster General to be following that argument in this paper with much attention because he has not even managed to realise that the title of the paper is mistranslated.
I would not expect the Paymaster General, given his opening speech in the debate, to realise that if the Government do not support these new proposals for financial mechanisms in the Community, they may find themselves out of line with Council decision 87/307 and amending Council decision 83/624 87, known in less numerate terms as the SPRINT programme. If we look at annex III to the SPRINT programme, in the document to which I have referred, we see that we had agreement by the Council for priority action on
"Organisation of pilot activities, transnational in aim or in nature, relating to the training of technology transfer specialists on the management and financing of innovation and related fields".
There is even
"Establishment of liaison mechanisms between local authorities"—
I stress that to my hon. Friends—
"as agents in the innovation process, as regards both the possibility of fostering innovation through co-operation on procurement and their role, or that of equivalent bodies responsible for innovation".
This, again, is an example of the Government's bias against mixed economy intervention at local authority level. It is to the credit of the Commission, in bringing forward proposals such as it has brought forward in the document that is mistitled "financial engineering", that it realises that there is a need for joint action and joint policies between Governments to strengthen and equalise the competitive opportunities for small and medium firms. That has a major relation to the feasibility of effective regional development, which itself concerns the spending of regional funds.
Sir Anthony Meyer: I am listening to the hon. Member for Vauxhall (Mr. Holland) with great interest and a certain amount of encouragement. The hon. Gentleman talks about the need for more
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common action, but is what he says compatible with the passage in the amendment that he is moving, which seems to regard any movement towards harmonisation of VAT as
"not necessary for the achievement of a common internal market"?
Perhaps the hon. Gentleman will cover that point, as I should like to hear his views on it.
Mr. Holland: As the Paymaster General might say, I am indeed coming to that point. I am sure that the hon. Member for Clwyd, North-West (Sir A. Meyer) would not wish me to break the logic of my exposition.
On the social fund, I should like to raise a matter that was brought to the attention of my hon. Friend the Member for Barking (Mr. Richardson), by the Glamorgan women's workshop for high technology. [Interruption.] The project is jointly funded by South Glamorgan county council, the European social fund and Cardiff city council. Before Conservative Members show further that they regard this as a derisory matter not worthy of discussion in the House, they might pay attention.
The arguments made on behalf of the workshop are:
"It is clear from studies Europe-wide that women are still vastly under-represented in certain traditionally male occupations."
They continue:
"We are particularly disturbed that the guideline under which most women's training projects are funded has been amended from a general priority for training women—in areas where they are under-represented—to a priority in the first year of operation only."
They point out:
"This will exclude all training projects in the women's training network which have already been in operation for over one year."
We share the view:
"It is crucial that the European social fund confirms its commitment to women's training by retaining the specific guidelines relating to women. There is no adequate provision for women under the other guidelines, and for a small operation like us, the restriction of priority status to projects concerning over 1,000 people certainly excludes all women's training projects."
I see that the Paymaster General is expressing interest in the matter. Part of the nature of the Community in its decision-making is that we cannot expect an assurance tonight from the Dispatch Box, but we take the matter seriously. It is another way in which lipservice is paid to the rhetoric of promoting small and medium enterprises in the Community when, as Conservative Members well know, any enterprise employing more than 1,000 people is no longer a small enterprise, but a larger medium-sized firm.
The hon. Member for Clwyd, North-West asked about harmonisation of VAT rates, and our call that agreement should depend on
"recognition that a harmonisation of VAT rates is not necessary for achievement of a common internal market by 1992".
The hon. Gentleman may not have been present when last I raised the matter from the Dispatch Box in relation to the internal market in the United States.
This is not a new area of interest for me. I shall not detain the House with a personal history, but I spent some time in 1970 at the Brookings Institution in Washington, looking precisely into the extent to which features of the common internal market of the United States depended upon integration and harmonisation of tax rates and other provisions, rather than the sheer size of the market, and

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the chance to achieve economies of scale within that market. Frankly, having studied the matter then and having looked at differences between corporate tax rates and local and state taxes in the United States, I could not find any commentator in the United States who thought that harmonisation of state and local taxation, or even harmonisation of corporation tax, was essential for economies of scale inside the United States. I suggest that the Commission and many of those who service it and those in the think tanks have got it wrong.
There is no more a need for us to have completely aligned VAT rates than to have completely aligned social security or Health Service provisions. One of the problems of the Community is its failure to address priority issues such as joint action to ensure a regaining of the industrial competitiveness of firms in Europe. Joint action could counter a continuing risk—despite what is reported by OECD—of a world economic recession, ending in a slump. We should tackle structural and technological unemployment. Instead, we have harmonisation of rear-view mirrors, rubber products, passport covers and number plates. Those have as great a role in stimulating economic growth as the harmonisation of VAT rates. They are all of secondary importance. They verge on the trivial. This is the problem with the Community's agenda.
The sort of agenda that we are asked to address in the debate tonight, in the achievement of an effective Commmunity budget, does not depend on harmonisation. The imperative of the European Comunity today is not to integrate but to co-operate. It is failing even to agree to co-operate on measures for integration of VAT. However, I do not particularly want to hammer the Government on this matter, because they have said already that they have reservations about it. Perhaps we could have a cross-Bench alliance on this matter, as well as reconsideration of the Commission's proposals on financial mechanism, rather than engineering. That could have beneficial effects locally and regionally.
Moreover, in answer to the hon. Gentleman's point, fiscal differentiation might be beneficial rather than a disadvantage or an obstacle to integration. Unequal integration has been admitted right from the report by the founding fathers of the European Community at the Messina conference. It was admitted then, unlike the terms of the treaty of Rome, that free working of the free market mechanism aggravated structural, social and regional disparities within the member states, which needed to be offset by the regional and social funds that we are debating tonight. Fiscal policy has a positive role to play, if that is the case, as it could equalise terms of competition.
There are certainly some cross-border problems. The hon. Member for Clwyd, North-West referred to this with regard to VAT harmonisation. In the case of Luxembourg and neighbouring states, differing VAT rates may promote cross-border shopping trips. But on the major issue, whether we must have VAT on food, clothing, children's clothes, books and publications and reading material in this country, which is the greater priority—the problem in some border areas of shopping sprees, or a taxation measure that would penalise everybody who eats, every child, and everybody who reads? We ought to get the priorities right.
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We have drawn attention to the fact that cross-border exchanges between the Republic of Ireland and Northern Ireland have been promoted because there are different tax regimes for goods. In another context, no doubt we would all welcome that. But if we are all to be good Europeans, perhaps we should have differing VAT rates for promoting co-operation.
I am keeping an eye on the clock, Mr. Deputy Speaker, for the sake of Conservative Members and my hon. Friends who wish to speak in the debate.
On the further matter referred to in our amendment, we believe that the real priority agenda should be joint international economic action. That concerns less all Community Europe expenditure passing through the eye of the needle in Brussels, and more the Commission, the Community and Parliament playing a bigger role in sponsoring encounters between those who want change in the industrial structure of Europe and joint economic programmes for recovery to take the strain off the dollar and stabilise world currencies, and more give some reality to the negotiating triad of the Japanese, Americans and European Finance Ministers, which lies behind the Group of Seven, or any other major group, in terms of summit economic policy.
In that context, we have chosen to refer to the role of the medium term economic policy committee, with which at least Treasury officials should be familiar in its renamed form, the economic policy committee. It is not surprising that the words "medium term" have been dropped. I mean no discredit to those who serve on it, but increasingly this committee, which used to have a powerful role and was a useful forum for intergovernmental co-operation within the Community, has been reduced to the role of a forecasting unit. It is no more effective than an inner OECD working party.
When the committee was set up by Marjolin in 1964 and produced its first report in 1966. it was a major forum enabling member Governments to address at Community level what, in their view, was their important agenda, rather than simply react to Commission proposals and act within the terms of reference of the treaty of Rome, which is now 30 years out of date. Member Governments were able to set their own agenda on comparisons of the consistency of their macroeconomic policies and structural, social and regional policies. It is important that the committee should play such a role and important that its actions are reported to the House.
Our amendment states that there should be
"new accounting procedures to gain transparency on the market behaviour and abuse of dominant positions by bigger business in the Community."
This relates to what much of Community budget spending is about. There is much rhetoric and many measures concerning the budget and structural funds and about promoting a dynamic of small and medium-sized firms. The reality—I gave some illustrative figures earlier—is that bigger businesses dominate an increasing share of the Community's markets. Between 1963 and 1982, which was the last year for which figures were available, the top 100 firms increased their share of the Community's GDP from over one fifth to nearly two fifths. The top 10 non-agricultural firms in the EEC have as big a share of the Community's GDP as does the whole of the agriculture that is supported by the common agricultural policy.

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Behind this lies a sorry tale of the Community's failure to develop, on a joint governmental basis, effective mechanisms for industrial intervention and industrial policy. We shall not get it as long as we do not know what is going on. Articles 85 and 86 are full of claims for transparency and alleged concern about abuse of dominant position. While we are talking of the Single European Act and a larger and larger market, the debates in the House on spending and budgetary policy should include reference to the obligation on the Commission to ensure that an effective accounting is undertaken of these larger businesses. I believe that research programmes should be supported on that basis. If they want any help, I am perfectly willing to give it.
There is an imbalance between the peripheral agenda and the central issues affecting Community Europe. This budget debate is stuck in the mud of the common agricultural policy. Agriculture is the last sector in Europe that one should seek to integrate because of its phenomenal efficiency differences—15:1 between Denmark and Portugal in terms of milk products. It is impossible to integrate and have a common price system for such a sector without reinforcing those who are already rich in multinational agribusiness while still giving no more than a marginal income to peasant farmers.
When we look at the quality of services—housing, health, education, and so on—the Government and the Treasury have one policy: "If at first you don't succeed, cut, cut and cut again." When it comes to the common agricultural policy, it is: "If at first you don't succeed, pay, pay and pay again," without effective accountability and benefits to consumers and with vast profits to agri-business firms and stabilisers which appear to be on the incline rather than the decline.
With due respect for the fact that the Paymaster General gave way several times, and therefore perhaps lost track of the argument, his was a sorry speech, covering a sorry deal. It is time that the House gained redress.
8.15 pm
Mr. Terence L. Higgins: I gladly join my right hon. Friend the Paymaster General in the tribute that he paid to the Scrutiny Committee, which has done an extremely good job. When one considers the fact that the papers that we are debating form a stack 5 or 6 in thick of closely typed foolscap, the motion that the House should "take note" of those documents has a certain irony. The Scrutiny Committee's work is of considerable help in enabling the House to give some sense of priorities to assessing these various documents.
My right hon. Friend the Paymaster General was kind enough to express appreciation to the Select Committee on the Treasury and Civil Service, which I have the honour to chair. In return, I am bound to say that the help that he and his officials have given our Committee has been of considerable value. As often happens with our reports, the evidence is more important than the report. I hope that we have managed to set out some of the dilemmas that confront the House.
It is difficult for the House to debate these matters in the present form. In a sense, we would be much better off with a Committee stage procedure, when there could be more orderly interventions—I say that despite the generosity of my right hon. Friend the Paymaster General in giving way
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—and hon. Members could speak more than once. It is difficult in this form of debate to come to grips with some of these difficult and complicated issues.
The fact that we have a debate ahead of the Foreign Ministers' meeting enables the House to express a firm opinion on some points. As has been pointed out, the House will not come to a decision—in whatever format is decided upon—until later. This is not exactly a preliminary, but it is an interim, run round the course.
Mr. Spearing: The Scrutiny Committee is one of the best staffed Select Committees. The right hon. Gentleman is correct in saying that the House should be able to consider more legislation to approve decisions on the new financial structure. Does he agree that this is our last opportunity to discuss approval of next year's budget?
Mr. Higgins: I hope to turn to that point. That may turn out to be true. I hope that my right hon. Friend the Paymaster General will clarify the precise position. To say the least, it is obscure. If one were less charitable, one might say that it is chaotic. My right hon. Friend the Prime Minister returned to the House on 15 February and made a statement about her meeting in Brussels between 11 and 13 February. The impression was created that, although big changes were envisaged in terms of increasing own resources by 25 per cent. and strengthening budgetary discipline and so on, somehow this was a matter that could be decided and we would then move forward to 1992. I certainly welcome progress in that direction.
In the course of our analysis of what has been devoloping, we discovered that, far from the matter being cut and dried, there are serious procedural problems and timing difficulties. There are proposals for paying more money to the Community in the form of an intergovernmental agreement and an increase in own resources. We are setting those proposals against guarantees on budgetary discipline on the one hand and effective implementation of the United Kingdom's rebate on the other.
It is important to get the sequence of events right, lest we agree to paying more money to the Community without obtaining those things that my right hon. Friend the Prime Minister believes that she has negotiated. We need only consider the experience of the Fontainebleau agreement which, as my right hon. Friend the Prime Minister now recognises, has broken down as an effective form of budgetary restraint, to realise the considerable dangers.
I wish to deal with a point raised by my right hon. Friend the Paymaster General about our obligation to meet overdraft demands from the Community. He referred to that as a cash flow problem, but I am doubtful whether it is a cash flow problem. It is euphemistic to describe as a cash flow problem a situation in which, unless one receives additional money from another source, one finds oneself bankrupt. As I understand it, if we do not agree to an intergovernmental agreement and to an increase in own resources, it is not a cash flow problem, but a situation in which we simply run out of money.
I wish to deal now with the question whether we are obliged to go along with the overdraft agreement. My right hon. Friend, in an interesting passage in his speech, appeared to imply that we were obliged to do so if the overdraft requested did not exceed the amount that we were obliged to provide sooner or later under the existing

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own resources agreement. I hope that we shall not go beyond that, and I see no reason why we should. That would put us in danger of finding that our bargaining position had disappeared and that we had not secured what we wanted to secure.
I do not wish to deal here with the question of the composite or own resources bill. We shall have to consider that matter carefully, depending on how it develops, but the question of the budget, which was apparently agreed yesterday, is important in this context. It shows clearly how the Community is continuing to increase its expenditure all the time. My right hon. Friend said that Parliament had gone along with that, although Lord Plumb had not yet finalised matters. As I understand it, the President of the Council said that he was prepared to go along with the increase in the figure originally thought to be appropriate, although I am not sure by what authority he did that.
Perhaps my right hon. Friend would clarify the position. The crucial question is whether to go along with a proposal for an intergovernmental agreement after the budget has been approved. My right hon. Friend said, in evidence to the Select Committee, that we would not do so until everything that we wanted had been agreed. I hope that he will make it clear that that is the position.
I turn now to the difficult question of rebate. On 15 February, my right hon. Friend the Prime Minister gave the impression that our rebate was completely protected, but there is now the so-called Italian question. I am not clear on what basis the objections are being raised, as they clearly appear to contravene what was thought to be agreed at the summit. We have experienced this problem before. We go along with these ideas in broad outline, but, when settling the details, we find that the matter is not as cut and dried as we thought it to be.
My right hon. Friend did not mention the change in principle from a VAT-based own resources to a GNP-based own resources. The Select Committee commented on that and my right hon. Friend gave evidence on that point in Committee. The Committee has had occasion, in its recent report, to point out that the United Kingdom's calculation of GNP is extremely difficult because one can calculate it in various ways—for example, by the expenditure method or the income method—and obtain different answers. It is worrying if, in the light of that, the Chancellor of the Exchequer does not have a good basis upon which to react in terms of economic policy.
However, something different is involved in this change. We are relying on the GNP calculations to decide how much money we pay over in terms of taxpayers' hard cash. If our GNP figures are as suspect as they now appear to be, I wonder what the GNP figures are like in other countries. We should not go along with the proposal until we are satisfied with the statistical basis for the calculation.
I wish to say a few words about budgetary discipline. It has been suggested that the move towards stabilisers in relation to the common agricultural policy is a great advance. My right hon. Friend the Prime Minister, in her statement on 15 February, said that the stabilisers on agricultural products would be very important and that, if the output were too great, there would be a price cut of 3 per cent. a year on the whole crop. It is important that that
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should relate to the crop as a whole, but, nevertheless, the cuts are cumulative and, if harvests continue to exceed the threshold, there will be a huge 12 per cent. price cut by the fourth year. The idea that that will have a dramatic effect in reducing surpluses, even over the four-year period, is absurd, but I view with scepticism the idea that it will have an immediate effect when the surpluses continue to increase.
Similarly, we have been told that agricultural expenditure will not continue to increase as quickly as it has been doing and will increase only at three quarters of the rate of the Community's GNP. I have yet to be convinced that there is any case for increase of expenditure on agriculture when we have those surpluses. The idea that budgetary discipline is effective in that respect is therefore very doubtful.
Mr. Teddy Taylor: Does my right hon. Friend agree that, apart from those nonsensical percentage estimates, a considerable amount of expenditure has been added on to budgets for 1989 and the future, instead of being included in the 1988 budget? In addition, some expenditure previously carried by the Community in 1987 is being carried this year by member states.
Mr. Higgins: Those two points reflect the loopholes through which increasing amounts of money are pouring into the sector. However, I do not understand why the agricultural community alone should be protected against fluctuations in the exchange rate. No other industry is put in that extraordinary position. We have not tackled that problem and it severely weakens budgetary discipline.
In the light of experience after Fontainebleau, the Prime Minister told the House, "It didn't work, but we shall have it made legally binding in future. Don't worry—the arrangements that we make on budgetary discipline will be legally enforceable." However, we now discover that that applies only to certain aspects of the budget; it will not be legally enforceable overall. It will apply to obligatory expenditure but not to non-obligatory expenditure.
In that context, we shall have an "inter-institutional agreement". As I understand it, that will not in any sense be legally binding. Therefore, the idea that we shall have overall legally binding budgetary discipline is not the case. Yet that was certainly the impression created in the House at the time of my right hon. Friend's previous statements. It remains doubtful whether the measures which will be legally binding will in reality impose the kind of restraint on Community spending that we would normally mean when we say that there is effective control of public expenditure.
I well understand the difficulties which my right hon. Friend the Paymaster General and his ministerial colleagues are having, but it seems absolutely crucial that we should not go along with an IGA or with proposals for an increase in own resources by whatever parliamentary mechanism may be agreed, until such time as the rebate is effectively imposed and guaranteed and we have an effective degree of budgetary discipline. I regret to say that that has not been achieved.
I hope that I can encourage my right hon. Friend and his colleagues to do everything possible to achieve effective financial management in the Community, which so far has most certainly been lacking. Unless we do that, those of us

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who wish to see further progress, as I certainly do, in the run-up to 1992 and all that that implies will be seriously compromised.
Mr. Curry: Before my right hon. Friend sits down—
Mr. Deputy Speaker: (Mr. Harold Walker): Order. I think that the right hon. Gentleman has sat down.
Mr. Leighton: I think that the right hon. Gentleman was just hesitating. He has made an absolutely unanswerable case and we are indebted to him and his Committee for the way in which they have monitored this matter over the years. What moral does he draw from this? There is no financial discipline on the CAP and there will not be. The whole question of reform is nonsensical. The CAP will never be satisfactorily reformed. Can the right hon. Gentleman see any advantage to the United Kingdom in having a CAP? Is not the moral that we should extricate ourselves—
Mr. Deputy Speaker: Order. I thought that the hon. Gentleman was seeking to make an intervention. I call Mr. Higgins.
Mr. Higgins: Having argued for a more Committee-stage approach to these problems, it would be churlish of me to insist that I had sat down.
The reality is that we are making considerable progress towards some control over the problem. Many political pressures are impinging on this. The argument that we shall get more discipline from countries which are net contributors turned out to be a delusion, and that argument was put strongly at one time. We must work hard to get the structure right, and we must all press for that. In terms of practical politics, we cannot say that this is the end of the matter and we shall withdraw. We must work as hard as we can and encourage my right hon. and hon. Friends to do all that they can to bring some sanity into the proceedings.
8.33 pm
Dr. John Reid: My hon. Friend the Member for Vauxhall (Mr. Holland) referred to a mistranslation from the French of the phrase rendered in English as "financial engineering". No doubt that was unwittingly mistranslated. For someone like me who does not have experience of these matters to the extent of some hon. Friends and hon. Gentlemen, it seems, although ironic, a fitting mistranslation. That phrase conjures up phrases such as "creative accounting" and "economic truths". In retrospect, the phrase "economic truths" seems to be a fitting description of some of the budget proposals and discussions that have taken place in the EEC during the past few years. Perhaps that is what gave rise to the motion that was tabled by the Socialist Group last night questioning the legality of the EEC budget.
As I have less experience of these matters than have many hon. Members, I read through the debate of 2 March on the European Court of Auditors and noted, among other things, the excellent contribution of my hon. Friend the Member for Vauxhall. He made some crucial points which merited being aired at a more civilised time. To make a speech at 1.30 am when the press has gone to bed and the Chamber is virtually empty does not reflect the importance of these matters.
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The Paymaster General also expressed some anxieties about the budget, and they should be aired again. Three points have not been clarified tonight: the imbalance between expense and revenue, the excess growth of agriculture expenditure, and the burden of past budget management—what would almost be called fraud in other quarters.
The right hon. Gentleman referred to what he called "cash flow problems". It is not a cash-flow problem, but a cash problem. There continues to be an imbalance between expenditure and revenue, and this is what lies at the heart of the Community's financial mess. The imbalance has two main causes: first, the failure of budgetary discipline to control excessive expenditure, especially agriculture expenditure; and, secondly, revenue ceilings which the Court believed were artificial and took insufficient account of the Community's financing needs. The Court of Auditors unfortunately felt that that would continue, particularly in view of the mountains of surplus produce waiting to be disposed of or depreciate.
On the previous occasion the Paymaster General told us that we had the machinery for change—in the context of the Community, that must at least be speculation—and that if it worked we should see a legally binding guideline on agricultural expenditure, which should grow more slowly than the Community's GNP. The Government's message, couched in more equivocal language tonight, is that the days of automatic, unlimited price support are over. I hope that that does not prove to be Government rhetoric, but on the evidence of the past few years our suspicions must be aroused that yet again that will be more rhetorical than substantial.
We have waited long enough for a serious move towards the limitation of CAP expenditure to a progressively smaller share of the budget, reaching, I hope, 50 per cent. by 1992, as opposed to the present staggering figure of 70 per cent. Surely we and the Government must consider our priorities in approaching the whole matter. The provision of increased resources for the structural arid social funds are politically and socially essential for the real success of any common internal market.
We are told by the Department of Trade and Industry—or the "Department of Advertising" as it is rapidly becoming known—that 1992 will provide a historic opportunity for British business. If that opportunity merely puts money in the hands of the likes of Amstrad's Alan Suger, instead of breathing life into a crippled economy, it may satisfy the Government and a few of their City friends, but it will not satisfy Labour Members or British industry generally.
The social fund should be increased substantially if we are to pay more than lip service to the problems of the inner cities. I represent a steel-making constituency. Having learnt, over the last two days, that Ravenscraig, one of the most highly productive steel plants in the world, let alone Europe, is in danger of closure, the Community's preoccupation with agricultural spending becomes a sick joke to my constituents. Those priorities should be ordered not only to support our industry, but to help Portugal and Greece, where political and social measures are vital to the cohesion of the Community.
We have heard much about the Government's commitment to reductions in agricultural spending, and we witnessed an entertaining sabre-rattling performance from the Prime Minister in the European skirmishes. However, the March memorandum from the Select

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Committee on Treasury and Civil Service reveals that the 27·5 becu of agricultural guarantee expenditure now proposed for the 1988 budget represents no less than a 19·6 per cent. increase compared with the 23 becu provision in the 1987 Community budget.
The 1988 budget will, in addition, include 1·24 becu towards the cost of depreciation and disposal of existing excess stocks. If that additional amount is taken into consideration, the real percentage increase in agricultural spending from 1987 to 1988 rises to 25 per cent. on a budget which the Government constantly tell us should be, and will be, reduced.
In respect of that, the Paymaster General gave us resolute guarantees that the timetable, the cash flow and even the legality are uncertain. Tonight, in line with Churchill's famous phrase, he was "resolute in his equivocation." The efforts to gain control and reduce agricultural spending, and to maintain the system of budgetary control agreed at Fontainebleau, have been a dismal failure and all hon. Members are aware of that.
It is vital that the House and the Government realise the full extent of the failures. My hon. Friend the Member for Vauxhall explained the anomalies and lack of logic in the present position on 2 March. When the treaty of Rome was signed in 1957, one in four of the working population in the Community were employed in agriculture. That is no longer the case; in fact, far from it. The total working population in agriculture of the original six members of the Community is now down to about 5 per cent. For the Community of Ten—before the accession of the Mediterranean countries—that is down to about 7 or 7·5 per cent. It is now feasible to apply a deficiency payments system to the Community. We believe that that relates to the kind of analysis that the European Court of Auditors has made of the social and regional funds.
In the recent debates on this issue, we have heard guarantees from the Prime Minister and the Government that there would be a standstill on, or reduction of, the agricultural budget in due course. I do not agree with much that the hon. Member for Mid-Worcestershire (Mr. Forth) says in the Chamber, but I agreed with his use of the word "cynicism". Perhaps we should have regarded the statements with a little more cynicism. Since the statements were made, the binding controls that were promised have proved not to be binding and the budget is not under control. Spending has rocketed well beyond the ceiling of 1·4 per cent. In fact, it has gone far beyond the 1·6 per cent. which was never agreed to be binding on anyone.
My hon. Friend the Member for Vauxhall said that, instead of adopting a supranational approach to these issues, it would be better if the Community and its member states sometimes tried an international approach. If we cannot achieve co-operation we cannot force integration, and we cannot force integration even on the minor issues—the flood of transcendental minutiae—which have obsessed the Community and in which it appears we are now in great danger of drowning.
If we cannot deal with the minor issues highlighted by my hon. Friend the Member for Vauxhall, we cannot integrate on major issues unless we co-operate. It would be a tragedy, even for those hon. Members who are greater supporters of the Community than I am, if the vision of the
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founding fathers of the Community—eventual integration—were to become, not a spur, but an obstacle to further co-operation within the European Community.
I regret that the Paymaster General's statement tonight did not enlighten us on any of the problems that have been raised or promise any greater effectiveness from the Government. His statement was bad for the House. In the long run it will be bad for Britain and, I fear, for the rest of the European Community.
8.45 pm
Sir Anthony Meyer: These debates are usually depressingly familiar affairs. However, I am bound to say that so far this debate has taken a somewhat different pattern. We have heard two speeches from Opposition Members which started out being very interesting and appeared to face the real issues, but shied away from the fundamentals at the last minute. Neither the hon. Member for Vauxhall (Mr. Holland) nor the hon. Member for Motherwell, North (Dr. Reid) would accept that the further co-operation that they called for in those areas where the Community should be operating, where it should be stimulating new industry and creating new jobs, requires a very much more substantial degree of integration than either were prepared to admit.
The Labour party amendment reminds me of the News of the World calling for a moral revival. It clearly does not square with itself or the proclaimed attitude of the Labour party.
I had intended to say some severe things about the Government and my right hon. Friends on the Government Front Bench. However, I find it almost impossible, because my right hon. Friend the Paymaster General, with his transparent honesty and good will and the tremendous reputation that he has built up in Europe for his knowledge of the subject, is sitting on the Front Bench. He is ready to consider these questions very carefully.
However, I believe that Ministers are not facing the situation as it is and, above all, they are not obliging the House to face the situation as it is. There is general support, which was well articulated by my right hon. Friend the Member for Worthing (Mr. Higgins), for the need to contain the Community's ever-growing expenditure, particularly in the areas where further expenditure will lead only to ever greater surpluses.
There is widespread agreement on both sides of the House that something must be done about that problem. However, the agreement falls short—and I believe that the Government are guilty of allowing it to fall short—in the contemplation of the action that will be necessary to check that growth. It is not enough for the British Government to say, "This is what ought to be done. We all ought to adopt the same kind of rigorous system of financial control as is common practice in the House." At least, we like to think that it is common practice and we flatter ourselves to a large extent about that. It is not enough for the Government to say that other nations must pull their socks up, obey the rules and behave as if they were British. In a 12-nation Community, that simply does not happen.
When we debated the Single European Act, a Minister told us that the proposal for the Act was not only unnecessary, superfluous and bureaucratic, but would threaten our liberties. Would it be possible even to contemplate moving towards a single market—the aim for

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1992—without the Single European Act which introduced the notion of majority voting at any rate in those areas where vital national interests were not at stake? That Act was fought tooth and nail, denigrated and had scorn poured on it.
Lord Cockfield was sent to Brussels to achieve an objective. Ever since he has been there, Ministers have constantly decried his efforts and attempted to undermine him. Yet without the single-minded impulsion—the bloody-mindedness—that Lord Cockfield brought to the process, we would not be on the road down which we are substantially travelling today.
The same thing is liable to happen with fiscal approximation. We hear Ministers declaring from the Front Bench that it is unnecessary to move in any direction down the road of fiscal approximation. I take the point made by the hon. Member for Vauxhall, that the American market works well with substantial differences in levels of excise duty and sales tax in different states. But that is a single market, using a single language, with a single Administration. It is one country. It can afford to have different levels of sales tax. Indeed, there are different levels of sales tax in different towns within France. Nobody will call for total fiscal identity throughout the Community. None the less, there must be inexorable progress in the direction of diminishing the substantial discrepancies in border taxes.
Mr. Holland: That is a non sequitur. The large companies, whose activities are so untransparent, already dominate all our markets. It is like the researcher who, before the first application to join the Common Market, asked Pilkington what the effect would be, to which the reply was, "In float glass, we are the Common Market." The hon. Gentleman really cannot see the wood for the trees.
Sir Anthony Meyer: The hon. Gentleman is making my point for me. The supranational companies are not inhibited in their activities by different levels of taxation, but that is preventing smaller firms from growing into major European firms which can transcend frontiers. That is where I take issue with the hon. Gentleman.
The Government are clearly resolute in their determination to get to 1992 to eliminate the tariffs, and at the same time to achieve a Community in which there is reasonable control over soaring levels of expenditure, but we shall not get there until they confront the country and the House with the painful choices that will be involved.
The requirements imposed on the Government and on the House in order to achieve those objectives must transcend the pledges given in the heat of the moment in the course of an election campaign because somebody accuses the Government of wanting to bring in VAT on children's shoes, and so on. Bigger obligations than those are involved here. If we really want to achieve the advantages of a full Common Market, which is not an extravagantly bloated bureaucratic affair, we must give overriding priority to our international requirements and a much lower priority to domestic political ones.
8.52 pm
Mr. Matthew Taylor: Our proceedings are made difficult, as hon. Members have said, by the need to debate such matters on the Floor of the House. With documents 4 or 5 in thick, we cannot be expected to make
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detailed comments on what is happening. In many ways it is a pity that we cannot deal with this in Committee, as has been suggested.
However, even if such a change were to he made for budgetary proposals of this sort, there can be precious little United Kingdom parliamentary control of the budget. The dual system in the EC—the Council of Ministers and the European Parliament, particularly the Council of Ministers—means that there will always be an element of negotiation after anything that the House has said and done. We cannot instruct Ministers in any detail on what is to be done, because there will have to be negotiation. We cannot give the final negotiating position to the Minister, because that would give the game away. We cannot give the upfront starting position to the Minister, because then he has no position from which to negotiate.
Mr. Spearing: There is always contiuous negotiation, and we would not expect the Government to reveal their hand, but does the hon. Gentleman agree that the House is perfectly capable of telling the Minister the point beyond which he should not go or the point at which he should start? Is he aware that the Danish Folketing does that every week within the terms of the treaty of Rome, so why should not we?
Mr. Taylor: Any negotiators who begin by announcing their starting and finishing positions will not get far. However, this is a relatively small point and I make it only by way of comment on what has been said earlier.
There are serious anxieties about the Government's ability, with the European partners, to keep control of the CAP, and, indeed, the European budget as a whole. We can see that they have not brought those under full control. Whether our Parliament sets down rules on that will not make any substantial difference. However, the problem with debates such as this and the way in which the EC currently goes about matters, is that we become obsessed with overall figures, the techniques for controlling them and the techniques for dealing with what are clearly, in many areas within the EC, spending controls that simply have not worked. We have forgotten how I he matter relates much more directly to the individuals in each country—the little people—who bear the brunt of many of the decisions that we are taking. We are looking at overall macroeconomic figures, but those people suffer the microeconomic impact when it comes.
That, more than anything, is true of the CAP. Typically, the Labour party takes a particular interest in the overall cost of the CAP. I take a particular interest in its effect on the smaller farming units, particularly the effect of the controls on the 'CAP on smaller farmers such as those in my part of the country.
The problem with the way in which we deal with such matters at the moment, and the problem with the overall budgetary details in these documents, is that, when we talk about controlling the CAP, because everyone cannot get together to agree a sensible policy to take account of the individuals who are affected by it, we impose it overall., and that has a disastrous impact on those who are most in need of help from the EC.
When we debate budgets and policies, we sometimes forget what the CAP should be about, which is helping

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those who need help. We should endeavour to ensure that we are not causing greater problems. The House, Ministers and the EC have not successfully tackled that problem.
If we look, in particular, at the way in which the system works, the real problem is that we only consider the macroeconomics and the levels at which budgets should be set, not how they will work in detail. On the CAP, we have no policy to allow maximum control for the smaller communities within the EC to generate policies that are relevant to them. What we do is too much on a macro scale.
Similarly, on fishing, decisions are taken to control the overall budget and we then attempt to implement them in a bureaucratic way, which is about saving money, not about relating policies sufficiently to the particular communities concerned. We feel the impact of that at a local level. Fishermen have no local control over quotas, and MAFF botches it time after time. We talk about the macroeconomic control of the EC's budget but we end up neither controlling that budget nor assisting the very people we are meant to be helping by the spending of that money.
The Labour party's amendment has properly highlighted the fact that, while concentrating on solving the problems of the CAP, we are not putting sufficient effort into the social fund. The Government are under a particular obligation to do so, but they fail to consider how the fund relates to people. They are interested in the cost of the EC—as they should be—but they ignore the benefits we could obtain from the Community by taking advantage of its ability to devise a social and economic policy which will respond to problems in certain parts of this country and to certain parts of the Community as a whole.
The current situation is one almost of farce, in which the Government have said in response to the EC's offer of money to dual the A30 through Cornwall that they will take the money but cut their own budget so that there is no increase in total spending on dualling that road. They appear to have completely lost sight of the potential offered by the Community and of the reasons for our membership of it. The ways in which it can help local communities are being overlooked. Instead, we appear to be focusing only on a general budget document and on making economies. Although the Labour party is right in its analysis, we would like to see the Government do far more.
On the other hand, the Labour party offers the prospect of a new corporatism. Instead of tea and biscuits at No. 10, the idea is to have sandwiches at Strasbourg. There is the notion of "intergovernmental action" rather than integration. That will solve nothing. While ensuring that the European Community generates funds and encourages integration and the breaking down of barriers so that people can take advantage of the opportunities which Europe offers, we must also make sure that that process is not run from the centre by means of a giant corporate strategy perceived in Europe. We must devise a structure that will allow for local control. If we can grasp the opportunity for Community action in that way, we shall gain some advantage from it.
We are having this debate almost as though hardly anyone is affected by the matters being discussed. The
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small number of hon. Members present in the Chamber shows how few Members of Parliament believe that the Community relates to their contituencies or believe in its ability to tackle local problems. That is a failing of the Community and of the Government.
Integration of the kind I have mentioned need not be inflexible. It need not be on a macro scale or follow the "biggest is best" principle—that the same must apply to all. That is particularly so in respect of VAT rates. I was pleased to hear the Government say that they are not seeking a universal VAT rate. There is no evidence that such is needed. Certainly the American experience does not suggest otherwise. It may be that wildly differing rates in different countries could cause problems, but we are concerned with the ability of our country to react to the problems of the individual and to devise social policies to meet those problems.
We have social policies which meet the problems of children or pensioners, and which ensure that people are equally able to buy books and newspapers. Those policies do not need to change because of our membership of the Community and the wish to break down tariff barriers. It is crucial that we recognise that truth, and that the Minister stands by it.
Mr. Brooke: I infer from the hon. Gentleman's remarks that he is turning his back on the position taken by the Liberal party in respect of VAT in a peculiar debacle earlier this year.
Mr. Taylor: The Liberal party did not take such a position—[HON MEMBERS: "Oh."] I was among those of my hon. Friends who ensured that it never will take such a position. I am happy to confirm that we do not stand by the commitment to which the right hon. Gentleman referred. [Interruption.] I refer instead to our wider commitment to ensuring that the Community is about allowing individuals the freedom to do what they want, in making their own way and in overcoming their own difficulties at a local level. That is the emphasis we place on the European Community. It will be interesting for the Conservative Members who are commenting to see what the Government do in practice. We have heard the Government say that they do not want that; I think that we may well find that it is the Government, not we, who introduce it. It will be interesting to see whether the smiles on the faces of Conservative Members are as broad when that time comes.
9.4 pm
Mr. David Curry: Fifteen years ago, I was a Financial Times correspondent in Brussels. It fell to our office to monitor one of the early renegotiations of British membership of the European Community, that conducted by the Labour party when it was in office. I have no doubt that some right hon. and hon. Members will recall that perfunctory and self-satisfied performance, which left the entire fisheries agreement untouched and led to the referendum in the United Kingdom.
If we are to hear criticisms of this Government's performance in reforming the European Community, we must be clear about the yardstick against which it is measured. That performance—now, mercifully, a long time ago, as it is a long time since the Labour party was in Government—is the only yardstick that we have, and it was a dismal performance.

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One of my responsibilities was to monitor agriculture. The Labour Ministers of the day had an amazing reputation for conceding high increases in farm prices—once, I recall, a rise of 14 per cent. The problems of the common agricultural policy are not recent; they go back to the origins of that policy. I readily concede that some fundamental mistakes were made at that point. I think, however, that it will make for a more candid debate if we recognise that all parties have faced identical problems in trying to bring reason into some of the Community policies, and that all parties have had to compromise in that pursuit because of the nature of the dynamism within the institutions in the Community.
I note that the hon. Member for Vauxhall (Mr. Holland) appears to be enunciating a new Labour policy towards Europe—I am glad that it is a new Labour policy—that we are looking for a sort of Continentwide intervention via mechanisms such as the social fund and, no doubt, the regional fund, to which I am sure he is equally attached. If that means that we can now argue about Europe not in terms of being in or out, but against the background of the free-market, single market approach to interventionism, at least we put the debate on a sensible, rational footing. I am happy to fight my corner if that is the Opposition's argument.
I also noted several references to the need to attempt to bind the Government when they go into negotiations with the Community. Last week, a Labour amendment was tabled to the discussion on tax approximation and, if memory serves me right, only 91 hon. Members voted for it. Clearly, there is a certain amount of conversion to be done—even on the Conservative Benches—in relation to that thesis. I have to say, however, that the Folketing has not proved outstandingly successful. It has managed only to create enormous embarrassment for its Government, who have spent considerable time and a number of general elections trying to sort the matter out.
Mr. Holland: Does the hon. Gentleman mean that he does not approve of elections as a means for voters to express their will in this matter? Does he not recognise that there is a role for the democratic process in national Governments, rather than their being overridden by supranational institutions?
Mr. Curry: I know that successive Governments in Denmark have found themselves forced into elections almost by accident rather than by design. That sort of haphazard democratic process may not necesarily commend itself to the House.
We have three important documents before us: the proposal on own resources, with the new fourth resource; the proposals for budgetary discipline; and the amendments to the financial regulation. I want to begin with the Cinderella, the amendments to the financial regulations. It is easy to talk in grand terms about controlling this or that, but we have to make sure that the nitty-gritty is right. If we are not in charge of the management of what is happening on a day-to-day basis, we do not stand a chance of getting the big problems put right.
There are three important elements in the financial regulations. The first is the provision which makes it difficult for unused appropriations to be carried over to the following year. Opposition Members talked about the social fund. Its functions are important, but it has a poor
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record of managing to spend its appropriations. Its efficiency in terms of rate of spend is poor. Opposition Members should recognise that if they want to demand greater resources for it. Up to 1 billion ecu of expenditure has been handed over automatically in the past. That is not a good way to run a railway. In the interests of transparency and the annuality of the budget—because it is an annual budget—it is important that that practice should be changed.
The second measure is the change in agricultural finance, which converts the advances into reimbursement but describes them still as advances. The invention of the retrospective advance is one of the less felicitous inventions of the Community vocabulary. It has now been made permanent, with a two-and-a-half month delay before member states are reimbursed for their expenditure.
This is a positive move, but it would be unwise to attach too much importance to it. Certainly it is better for monitoring and control if the Commission can see expenditure before it has to disburse its resources rather than simply hand out cash in advance. Up to now, the correction to the account has been done in March of the following year, so there is a further useful gain in that, but it is important not to exaggerate its extent.
Certain amendments will be proposed when the measure goes through the European Parliament. I ask my right hon. Friend to do his best to sustain them. At the moment the Commission dishes money out from a general kitty and it goes to wherever it is needed. I think that the Parliament will attempt to establish a series of kitties so that there is a chapter-by-chapter monitoring of expenditure. Again, this would be a management gain in the efficiency of the operation.
The important element of the financial regulations is the attempt to sort out the dreadful business of clearance of the accounts. It has taken five to seven years after the end of a financial year for the Commission to get legal clearance for the money which has been spent. The time is now down to about three years—hardly a brilliant performance. The trouble is that some people have moved on; probably some documents have moved on as well. When there are political problems, such as the way the French implement co-responsibility or, dare one say, the Milk Marketing Board its payments, it is difficult to obtain redress.
There should be much quicker clearance. The Commission is offering to clear the accounts by, if I recall rightly, mid-September of the second year after the closure of the accounts. I urge my right hon. Friend to argue the case for clearance, except in the most exceptional circumstances, one year after the end of the accounts. That should be an adequate period if we are to have effective scrutiny and management of expenditure.
As to own resources and budgetary discipline, I take to heart the comments of my right hon Friend the Member for Worthing (Mr. Higgins) and other hon. Members about the necessary imprecision of certain proposals arid the fact that to some extent one has to take things on trust. In a sense, that is the nature of the organisation.
I want to enumerate some of the bull points. I choose my words with care. We have a legally expressed discipline of farm spending which is linked to new and restructured own resources operating through the stabilisers, and we have renewal of the rebate system, an important achievement which was difficult to get. I agree that the old Fontainebleau system was not as effective as we had

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hoped, but there is a further strengthening in the mechanism. I urge hon. Members to consider the trend of what has been happening rather than the absolute. We will be disappointed if we always seek absolutes.
With the new system of own resources, based on gross national product, there should be no need for a further increase in Community resources while the present policy mix exists. Provided that no major new policy is introduced, there should be no requirement for further increase. At least that provides a more dynamic basis for a budget than we have had in the past. That gain is worth having.
It is also worth remembering that any system based on GNP helps the United Kingdom, as the United Kingdom's share of GNP is smaller than its share of VAT. We could have done without the 55 per cent. cut-off, but even with that, we benefit from the system. The monetary reserve is better than the exceptional circumstances provision that we had in the past and, as my right hon. Friend said, it works both ways and is specific to the ecu-dollar relationship.
Also important is the year-on-year overall limit on expenditure which was written into the Brussels summit—the sub-ceiling. That is likely to bite quite severely. For example, agricultural expenditure is at a ceiling of 27·5 billion ecu. A number of member states are now pressing for the devaluation of their green currencies in the course of the present farm price fixing, which is at a big round zero, as it has been for a number of years.
The Commission is holding out against that, because a 1 per cent. devaluation of the French franc, which is a major agricultural currency, would add about 120 million ecu to the budget in a full year, and the Commission cannot go beyond the ceiling. The ceiling will start to cause dilemmas, and the United Kingdom has been one of the most insistent countries calling for devaluation of the green pound for its farmers.
Will the stabilisers work? My right hon. Friend the Member for Worthing has pointed out some of the difficulties of the cereals stabiliser. I agree with him that the 160 million tonnes ceiling was too high. It is true that if the 3 per cent. cut applies year on year, it will accumulate to 12 per cent. and eventually will lead to a cut of one third between 1983 and 1993. One is certainly entitled to be doubtful about the long-term effect of such a cut, particularly with an underlying yield increase of between 1·5 per cent. and 2 per cent. and the changes in the green rate which we are demanding and which will counterbalance the cuts as they come into effect.
The wine stabiliser is also important because the price has been cut very severely. The conclusion is that certain countries now have to recognise that they must live in the world market place. A country such as France does not have the option of treating its farmers simply as a sort of social therapy, which some member states seem to consider desirable. It is committed to finding outlets on the world market and therefore has to apply agricultural disciplines.
May I also point out the importance of the depreciation of stocks, and mention one or two brief figures which illustrate some of the effects of the stabiliser mechanism. I have done some research into the level of stocks. The butter stocks are down significantly. The £2 billion specially earmarked for disposals was an extremely
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expensive operation, but butter stocks are now down to 580,000 tonnes against 1·2 million tonnes a year ago; skimmed milk powder is down to 320,000 tonnes against nearly 800,000 tonnes a year ago, and fewer than 25,000 tonnes of new butter has gone into intervention in the past 11 months.
There is no new accumulation of stock at the moment. More important is the level of world prices which affect the budget. Butter has just been edged up to $1,100 a tonne under the general agreement on tariffs and trade minimum price of $1,000 and there is no reason why that cannot start moving back to the $2,400 per tonne which it occupied some years ago. Skimmed milk powder has moved from $700 to $1,550 a tonne on the world market since June last year and whole milk powder has risen from $800 to $1,500 dollars a tonne on the world market since June last year. Cheese has risen by $400.
Mr. Teddy Taylor: Will my hon. Friend, who understands these things, explain why, in view of the new minimum price, the EEC sold 240,000 tonnes of butter to the Soviet Union at 6p a pound last month?
Mr. Curry: That is because there was a special derogation under the GATT agreement approved by the other major performer on the world market, New Zealand, as some of us heard Mr. Jim Graham, chairman of the New Zealand dairy board, explain about a week ago at the Back-Bench committee. That permitted the Community to sell old butter at a severely discounted price—about one tenth of the $2,400 a tonne which butter has reached as a historical high in the world market. My hon. Friend is correct to say that there was a special discount price for old butter to the Soviet Union. My point is that firmness in world market prices is the best chance of bringing some control to agricultural expenditure.
There are reasons for increasing the structural funds, provided that the money is well spent. At present, it is poor quality expenditure. There is no reason to assume that because agriculture is "bad", the other expenditure is necessarily "good". We need to apply just as firm scrutiny to those funds to ensure that the money is well spent and that it does not simply replace money that has often already been spent by member Governments. The need for scrutiny goes across the entire Community budget.
I hope that when the matter comes to the House fully, hon. Members will feel able to approve the decisions taken at Brussels. They were important decisions and they represent a trend that is going firmly in the direction of budgetary common sense. I hope that I shall have the opportunity of commending them to the House then.
9.20 pm
Mr. Nigel Spearing: One of the reasons why attendance is perhaps not as great as it might be considering the importance of these matters is the complexity with which we are confronted. There are 14 documents and 16 Committee reports. It is no wonder that the Paymaster General, to use a cricketing analogy, kept a straight bat but did not try to make any runs. If he had tried to do so, the real position, which I find alarming, would be plain for all to see.
I shall attempt the almost impossible. There are about 14 reports from the Scrutiny Committee and, in 10 or 12 minutes, I shall attempt to summarise the summaries.

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Unless we try to do that, I do not think that we will understand what is happening. If I am wrong on any point, I am sure that the Paymaster General will correct me.
As I understand it, we are discussing four issues. We are discussing a new tax structure for the EEC and, in particular, a new resource. We are discussing whether we can have real budget discipline. We are discussing the budget for 1988 and seeing how, if we wish, we can fund the deficit for this year in the interim. There are other small subsidiary matters, such as keeping our own rebate system in case the Italians upset it. But that is a small matter which we can no doubt get over. I shall take the four major issues in turn.
On the new tax, we keep the old system. All the taxes coming into the country under customs duties are the common Community tariff and are own resources. The same applies to the food levies and the VAT-related payments up to the old 1·4 per cent., which is the Fontainebleau formula. All that stays. In addition, we have the GNP-related tax that will be the increase. According to EEC publication SW3 ABT, published at the time of the Brussels summit, it is going up from about 37,000 mecu in the 1987 budget to a maximum of 52,000 mecu by 1992 on current prices. That is an increase of about 30 per cent.
That will not be achieved in one go. We know that it is going up in different stages. The note issued by the presidency at the end of the Brussels summit—document SN, 461/1/88—says:
"(d) the application of a rate to be determined under the budgetary procedure in the light of the total of all other revenue to an additional base representing the sum of the gross national product at market prices."
On what basis will that percentage be determined? Will it be by a qualified majority vote or will it have to be unanimous? That will determine the extent to which there will be raids upon the tax in years to come.
How much of that is being used up already in the 1988 budget? My calculation is that a great big chunk of it is, but perhaps the Paymaster General will be able to tell us.
What is the new tax to be spent on? First, the structural funds are to be doubled. We start off our discipline by doubling expenditure on one fund. I quote from that same document:
"The contributions of the Structural Funds to the regions covered by Objective No. 1 will be doubled by 1992."
Therefore, we are going to spend double on the European regional development fund, the European social fund and the agricultural guidance and guarantee fund.
That brings us to where the production is coming from and to my second heading—discipline. As the right hon. Member for Worthing (Mr. Higgins) pointed out, it is not going to be much. I summarise the stabilisers programme, which was issued as a great triumph, as at best a means of reducing the rate of increase that would otherwise occur. That is the best way to sum it up. The hon. Member for Norfolk, North (Mr. Howell), a farmer boldly said in the House that he was going to sow more. The stabilisers, of course, will only come into effect a year after the figures are calculated; then there will be a reduction of 3 per cent. on prices for the next year. Even the Minister of Agriculture, giving evidence to the Select Committee, could not put his hand on his heart and say that this would work. He shared the doubts, I think, of those who were questioning him.
Before I come to the 1988 budget, I want to revert briefly to the question, which I rather pooh-poohed, of the importance to the United Kingdom Budget of the Italian
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question raised by the right hon. Member for Worthing. This is very important. People do not realise how enormous our net contributions would be but for this rebate. Figures provided by the Library show that our contributions for 1987 were something like £4,740 million—over £4 billion—of which the VAT-related contribution was £3,000 million. That is not 1·4 per cent. but 12 to 13 per cent. of the Exchequer income from VAT.
We got back from the agricultural fund £1,422 million, and the net payments before refunds amounted to £2,473 million. We did not get back anything like the amount that we put in. We got another £1,126 million in rebates and had a net contribution of £1,347 million. That shows that an enormous amount of our net payment is relieved by our rebate, and we understand that we may not get it. That is why it is absolutely essential that that rebate mechanism is in place before we agree to any IGAs or any increased tax at all, because power to control that will be power to control the finance that we get from the EEC in future.
I submit that we should not be discussing the 1988 budget with the mechanism. We ought to be discussing the new mechanism, the new discipline and the new tax separately. The only reason why we are discussing them together is that the EEC has run out of money before it has got the new structure in place. In effect, we are being asked in this debate, and may be asked in the future, to approve an estimate before we have approved the tax. That is the essence of the position in which the EEC now finds itself; and, of course, that is quite wrong.
The 21st report of the Select Committee—House of Commons 43 XXI—reproduces the comprehensive table that the Government placed in the explanatory memorandum. The last line states that the budget for 1987 was £25 billion. The draft budget for 1988 is £30 billion—an increase of £5 billion in one year. Is that not about 25 per cent? It also assumes that we shall have the money to pay for the increase and that the taxes will be approved. If not, the money will not be there. The Government want to bridge that £5 billion gap partly by the pre-payments about which we have already heard but whose amounts I do not know. Originally the idea was to bridge the gap with an intergovernmental agreement of £5 billion, of which our contribution was to be about £800 million—a controversial matter.
Today, the Paymaster General revealed new information. He said that we might approve such an intergovernmental agreement in a composite Bill that also approved the draft decision authorising the new taxes. After my intervention in his speech, he went on to justify such a move by saying that there were precedents for it. I do not recall them. The Government got into trouble a few years ago when trying to get through an IGA under the treaty. There was a court case about it and they had to introduce a Consolidated Fund Bill solely for that purpose. This is most controversial because the treaty of Rome says that the EEC should not spend more than its income; but the whole point of the intergovernmental agreement is to enable it to spend more than its legal income. That is illegal under the treaty of Rome. If it were done, any citizen could take the EEC to court.
In this all too brief three hours of debate we are being asked to approve a complex mechanism for a new tax and budget that is, at the moment, illegal. I see no way out of the EEC tangle. Clearly, the commitments to payment rapidly and increasingly exceed the tax that we are being asked to approve. It will bring in up to 30 per cent. more

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revenue, but the calls on that revenue will not be controlled because the nature of the common agricultural policy and of the politics of the member states of the EEC makes the equation impossible.
9.33 pm
Mr. Teddy Taylor: I hope that my right hon. Friend the Paymaster General will be able to answer the few questions that I can ask in the brief time that I have.
The small attendance at this debate is due not only to hon. Members finding the subject too complicated, but to a growing realisation that the views of the Government, of Parliament and of hon. Members on European matters are of limited importance. The views that we express have little impact on the amount of money that we shall pour out, and they will have no relevance to what is decided by the House. That is probably one of the main reasons why these important debates are attended by only a handful of people.
Another reason is that in these European debates, which are faithfully attended by the small number of hon. Members who are present tonight, we have been given a series of unfulfilled promises and expectations. I can remember hearing an almost identical debate at the time of Fontainebleau about how the problems were being solved. Yet in one of the many documents before us tonight, the preliminary draft budget, we read:
"This clearly shows that the Fontainebleau arrangement is hopelessly outdated and that it would be illusory and contrary to the resolve to impose a realism in budgetary matters to seek to adhere to it come what may".
In other words, the EC itself says that Fontainebleau was useless and pointless.
I think of the Government's repeated expectations and estimates of our current net contribution. I think of the financial year just ended. Official Government documents show that the estimate for the year just ended was £600 million net. It was then revised to £900 million net, and revised again to £1,500 million net. Most recently, the Prime Minister advised us that it would probably increase by £200 million to £300 million because of the arrangements at the Council just completed. We have had a whole series of disappointments.
I should like to ask the Minister five questions. First, what is the view of the Government or their advisers on the legality of this budget? It seems to me that under article 199 it is just not possible for the agreement arrived at between the President of the Council and the Parliament to proceed, because resources are not there. They have not been agreed or approved by the various Parliaments. What is the Government's view of the legality of the budget, and what can they do about it?
Secondly, can the Government give any estimate of the amount that has been excluded from the figures in the budget because of the special arrangements that were made recently? I refer in particular to the special butter disposal programme. The document says:
"This is a massive programme costing vast sums of money but has been excluded from the 1988 budget because of a special directive task called 801/87 of 16 March 1987."
We know that a whole series of such devices have been introduced to make spending appear to be less than it is. One of the most interesting was the decisions taken 10 days ago by the European Commission to approve without any
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consultation with Britain a ban on the import of apples. That could result in consumers being forced to eat last year's apple mountain, which is unwanted. This is an important consideration, bearing in mind that this year over 100,000 tonnes of Community apples were disposed of or destroyed at vast expense.
Thirdly, can the Government tell us why, despite the steps that have been taken to reduce surpluses, the estimate for their destruction and disposal has increased to £221 million per week? We have been told about the emergency disposal of stocks and about stabilisers. I cannot understand why the budget should contain an estimate of over £220 million per week, the highest ever, for disposing of butter and other surpluses.
Is my right hon. Friend prepared to put on record his estimate of the percentage increase in the 1988 budget compared with the 1987 budget? What is his estimate of the increase in expenditure on agriculture in the 1988 budget compared with the 1987 budget? What does he think the net contribution of the United Kingdom will be in the forthcoming year? Although we know that my right hon. Friend is an honest and prudent man, he must be aware that the estimates and forecasts given to the House, have all, sadly, proved to be inaccurate, and always in the wrong direction.
The budget and the resources approved by the Government, subject to certain Council considerations, are genuinely disappointing. They are a disaster. They will not cut agricultural production; nor will they stem the increase in spending, which is out of control. Most sadly of all, there is nothing in these measures that will stop the EC from continuing to inflict hardship and damage on Third-world countries by wrecking world food prices.
We have heard many times about the Government's aspirations and expectations, but they must be well aware that by increasing so substantially the resources of the Community, and in the absence of any legal control over about half the budget, they are simply allowing the Common Market to carry on as before—wasting money, inflicting damage on the Third world and having expenditure that is almost wholly out of control.
9.39 pm
Mr. George Foulkes: On behalf of the Opposition, I put on record our disappointment at the lack of involvement, and indeed lack of presence, of a Foreign Office Minister. Some of us remember with fondness the way in which the right hon. and learned Member for Edinburgh, Pentlands (Mr. Rifkind) led the debates, when he was a Foreign Office Minister, with a panache that is now sadly and sorely missing. The Government, and the Paymaster General in particular, have an increasing credibility gap to fill in these European Community budget debates.
I am not up to continuing the cricketing analogies. The Paymaster General started the debate with a long and complicated, even repetitious, description that seemed more designed to obfuscate than to clarify the issue for the House. The right hon. Gentleman used Euro-jargon and referred to articles and regulations and the technicalities of whether the matter should be dealt with as a composite Bill or through the decoupled approach.
My objective, in the last few minutes of the debate, is to try to simplify the issues. Some of us have been attending these European budget debates for many years. My hon.

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Friend the Member for Newham, South (Mr. Spearing), and the hon. Members for Southend, East (Mr. Taylor) and for Clwyd, North-West (Sir A. Meyer) have sat through all those debates.
EC budget debates have become like Oliver Twist, always asking for more, be it non-reimbursable advances—my hon. Friend the Member for Newham, South will remember that phrase—or what are now called inter-governmental agreements, which have been sanitised as IGAs.
The hon. Member for Skipton and Rippon (Mr. Curry) asked for a yardstick. The Opposition's yardstick is not that used by previous Governments, but is based on the promises and guarantees that have been given by this Government. The Prime Minister said on 1 July 1987:
"We have made it clear throughout the discussions that it is necessary, before that question is addressed, to have agreement on effective and binding control over Community spending, including, in particular, agricultural spending."—[Official Report, 1 July 1987; Vol. 118, c. 493.]
The right hon. Lady repeated the assurance on 15 February 1988.
The Minister of State, Foreign and Commonwealth Office in one of the most telling and, as is usual for the right hon. Lady, frank interventions, said:
"Our central goal is the achievement of binding controls over spending. Runaway agricultural spending has squeezed all other expenditure. It is now accepted by our partners that the operation of the CAP has been of declining benefit to the very farmers it was meant to help".—[Official Report, 18 November 1987; Vol. 122, c. 1100.]
That is what some hon. Members have been saying today. The themes of guarantees and promises constantly come through statements from Government during EC budget debates. First, they say that there should be effective and binding control on expenditure before agreement is reached on the extra spending and funds voted by the House. Secondly, they say that there should be a switch from agricultural expenditure to structural funds and other non-compulsory areas of the budget. It is a pity that Foreign Office Ministers are not with us.
The Foreign Secretary was quoted in The Independent on 25 November 1987 as saying that the Government would block a summit agreement on extra revenue for the Community
"unless we make a reality of our rhetoric about stabilising expenditure."
We must examine today whether the objectives set by the Government, not by the Opposition, have been achieved and whether they have made a reality of their rhetoric, to quote the Foreign Secretary. The question is whether we should be contemplating providing further resources, for whatever it is called and however it is described, or whether, later in our discussions, perhaps next month, the matter will be dealt with by a composite Bill or a de-coupled arrangement. The Government's motion asks the House merely to endorse
"the Government's objectives of securing effective and binding control of Community expenditure."
It still remains only an objective after all these years, including my four or five years of personal involvement in these debates.
Has that objective been achieved? I shall use, not my criteria, but the judgment of the Select Committee on the Treasury and Civil Service, so ably chaired by the right hon. Member for Worthing (Mr. Higgins). On page 6 of its report, the Committee quoted the Prime Minister's statement on the Brussels meeting. She said:
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"the United Kingdom had made clear, first, that any further increase in Community resources must be accompanied by effective and legally binding controls on expenditure".
The Committee went on to examine whether that had been achieved. In paragraph 10, on page 7, the Committee said:
"We pressed the Paymaster General on the question of the legal enforceability of budgetary discipline."
On pages 8 and 9, the Committee concluded:
"We are not convinced that an inter-institutional agreement is the equivalent of a firm and legally binding text … we believe there are still grounds for remaining sceptical about the prospects for budgetary control in the future."
That is the control—control dominated by Members of the Conservative party. On page 5, the Select Committee concluded:
"As yet neither the own resources decision, nor the arrangements for budgetary discipline are in place."
There is none of the promised budgetary discipline. That is why the House should support our amendment.
The report says that budgetary discipline and own resources are "inextricably linked" with the
"provision to preserve the UK's abatement."
A number of right hon. and hon. Members, including the right hon. Member for Worthing, said that the Italian question posed a threat to the United Kingdom's abatement. It puts our rebate at risk. The Paymaster General must answer that question, which has been posed by hon. Members on both sides of the House.
As for switching from agricultural expenditure to spending on other aspects, we see that agricultural spending is still out of control. The Paymaster General was asked at the beginning of the debate to give the percentage, but could not. He was asked again. The answer is in the minutes of evidence to the Select Committee, which show that agricultural expenditure has increased by 19·6 per cent. over the 1987 budget. Expenditure on other aspects has not increased substantially, if at all. Far from being increased, the expenditure which we should like on the social and regional funds, overseas aid and research and development has sometimes been cut.
The hon. Member for Skipton and Ripon challenged the efficacy of some of the expenditure, but he should know that the director of the regional fund has produced a report on new structural funds. Any new structure has had to be postponed because of this budgetary problem and the inadequacy of resources. We want money to be put in to help the declining areas, not just of Britain—for example, in the steel industry, which was described by my hon. Friend the Member for Motherwell, North (Dr. Reid)—but of other parts of the Community. Instead of declining, the budget has increased. Instead of being a smaller percentage of the Community's resources, agricultural spending is larger.
In an excellent speech, ray hon. Friend the Member for Motherwell, North said that the vision of the founding fathers of the Community was being lost in such debates. The vision of the potential for political co-operation between Community members is being lost. The potential for improving the employment situation, through an integrated expansion of our economy, is being lost as a result of the detailed debates on these issues.
The United Kingdom Parliament will be asked to contribute more to a budget of doubtful legality. It will be asked to pay more when agricultural expenditure is clearly out of control. We will be asked to pay more when the British rebate is still in danger, the Government's promises remain unfulfilled and the pledges are seen to be hollow. I hope that Conservative Members, including the hon.

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Member for Southend, East and the right hon. Member for Worthing, who have criticised the Government and their failure to fulfil those promises, will take their courage in their hands, as they have done on previous occasions, and join us tonight in the Lobby to support our amendment.
9.50 pm
Mr. Brooke: It may be a sign of masochism, but, as ever, I have enjoyed this evening's debate. I am grateful to my hon. Friend the Member for Skipton and Ripon (Mr. Curry) for reminding us of the performance of the Labour party when it was in power. I was constantly reminded of that during the speech of the hon. Member for Vauxhall (Mr. Holland).
My hon. Friend the Member for Skipton and Ripon asked a question which caused me to remember the application of Parkinson's law to the Commission's behaviour. This was reflected by the hon. Member for Vauxhall, who disregarded the documents that we are considering this evening and constructed his own agenda. He was also following the other principle of Professor Parkinson—that the nuclear device goes through on the nod and one then has a long argument about the bicycle shed.
The whole of the hon. Gentleman's argument was devoted to the document on financial engineering. I do not want to decry that document. It was put in front of us at ECOFIN in May 1987 and included in translation the words "financial engineering". The hon. Gentleman said that there was adequate provision throughout the Community, but plenty of Community countries disagreed with the proposition relating to financial engineering when it was brought forward.
Whenever I read about the Labour party's attitude towards social engineering in future, I shall seek to substitute the words "social mechanisms" and see whether they work. As to the remarks of the hon. Member for Vauxhall about the Glamorgan woman's workshop, I assure him that I shall bring that matter to the attention of my right hon. Friend the Secretary of State for Employment.
The hon. Member for Vauxhall gave his King Charles head of a multinational company another good airing. He criticised the logic of my speech—and I was grateful to the hon. Member for Newham, South (Mr. Spearing) for disagreeing with him about that. The hon. Gentleman frequently contributes to these debates and is familiar with the issues with which we have to deal. I was addressing the evening's business as set down on the Order Paper while the hon. Member for Vauxhall rambled around his well-loved prejudices.
My right hon. Friend the Member for Worthing (Mr. Higgins) asked me a number of questions. He asked whether the prospective demand for a 12(2) overdraft was due solely to cash flow problems. We have not received a 12(2) request so I cannot give a definitive reply, but the Commission's cash forecasts clearly show a cash flow problem arising from normal transactions over the next few weeks. I acknowledge the rules that we must observe in considering that overdraft and assure him that we shall continue to observe them.
1194
My right hon. Friend asked on what basis the presidency agreed to the budget in Strasbourg last night. Herr Tietmeyer, the president of the Budget Council, agreed to a commitment about 2 per cent. above the limit set by the Parliament's statutory margin, on the basis of his interpretation of a mandate, which he was given at the Budget Council on 28 April, and to which the British Government did not subscribe. My right hon. Friend asked about the question raised by the Italians on the United Kingdom's abatement. The size of our abatement is not at stake. The point raised by Italy was how the other member states would finance the United Kingdom's abatement.
Finally, my right hon. Friend asked about GNP statistics—a question which he also raised with me in the Select Committee. I agree with him, and the European Council agreed that there should be a directive ensuring that the same definition of GNP is applied in all member states for own resources purposes. A draft directive has now been proposed and is under discussion in the Community.
The hon. Member for Newham, North-East (Mr. Leighton) intervened briefly with the word "never", which he repeated on several occasions. My experience, particularly of these debates, is that that is a dangerous word to use.
The hon. Member for Motherwell, North (Dr. Reid) showed a welcome interest in the Court of Auditors, but, given his preoccupation with it, perhaps he had not noticed the expansion of the social fund which was agreed in the Brussels Council's conclusions. He and my hon. Friend the Member for Mid-Worcestershire (Mr. Forth) suggested that so-called cash flow problems are a euphemism for overspending. There is a genuine distinction. For any level of overall annual spending, cash needs are bound to fluctuate from month to month as payments become due on different items at different times. That is why there are routine arrangements for managing own resources contributions in this way.
My hon. Friend the Member for Southend, East (Mr. Taylor) and others asked about agricultural expenditure being 25 per cent. higher in 1988 than in 1987. I wholly agree with them about the need to control agricultural spending, but it is somewhat misleading to talk of a 25 per cent. increase in 1988. Because of the introduction of delayed payments, 1987 was in effect a 10-month agricultural year. Taking account of that, the underlying increase in 1988 is less than 7·5 per cent.
Mr. Foulkes: Does that mean that the Minister can give a clear and categorical guarantee that agricultural expenditure for 1989 will not increase over that for 1988?
Mr. Brooke: The hon. Gentleman, who has studied these matters, knows perfectly well that there is a provision that the agricultural guideline will rise by 74 per cent. of the growth in Community GNP—and that is calculated to run at 2 per cent.
The hon Member for Truro (Mr. Taylor) betrayed the whole thesis of the Liberal party when, in response to an intervention from me about the Liberal party's attitude to VAT, he said that it had to have an ability to adjust. Many of us have watched the Liberal party adjusting literally between morning and afternoon.
I thank my hon. Friend the Member for Clwyd, North-West (Sir A. Meyer) for his kind words. Our noble

1195
Friend Lord Cockfield introduced the proposals on fiscal harmonisation. Where Council Ministers have not disagreed with them in principle, they have found massive disagreements in detail. If my hon. Friend is counselling us to countenance reality, he must study the reactions to these proposals throughout the Community.
My hon. Friend the Member for Skipton and Ripon, in a knowledgeable speech, drew attention to what happened under the Labour Government. Given our success in securing the abatement, it is worth remembering that the result of the 1975 financial mechanism was not a single ecu. My hon. Friend referred to VAT being capped at 55 per cent. of GNP as being to the disadvantage of the United Kingdom. It is in fact of further benefit to the United Kingdom, as is the introduction of the fourth resource based on GNP, because it reduces the contribution before abatement which we would otherwise have paid.
The hon. Member for Newham, South asked how the rate of the fourth resource would be set. The rate of GNP-related contributions required to balance the budget will reflect the expenditure decisions taken by qualified majority voting in the annual budgetary process, just as the annual rate of VAT contributions is determined under the present system.
The hon. Member for Newham, South asked how much of the new GNP-based own resource will be used up in 1988. The 1988 draft budget involves an intergovernmental agreement corresponding to the amount that would be raised this year from the new fourth resource. This implies a rate for the new fourth resource of around 0·2 per cent. of Community GNP. Total own resources in the 1988 draft budget are equivalent to around 1·1 per cent. of Community GNP. The hon. Member for Newham, South said that we might not get our abatement. There are no grounds for that belief. Our 1988 abatement is in the 1988 budget agreed yesterday. Our new abatement mechanism agreed at the Brussels European Council has not been challenged and is fairly incorporated in the proposed own resources decision.
The hon. Member for Newham, South and my hon. Friend the Member for Southend, East said that the 1988 budget was illegal. It is true that the treaty requires that the budget should balance. That was why it was agreed at the European Council that member states would make non-repayable advances, in order to balance the budget. So long as there is an IGA in place to balance the budget, the budget is valid.
My hon. Friend the Member for Southend, East asked whether there were any documents to suggest that the rate of growth of agricultural expenditure—
Mr. Teddy Taylor: When did the European Council agree the IGA?
Mr. Brooke: The European Council and the Budget Council following upon it agreed to agree in principle an IGA. It is perfectly true that an IGA must still be agreed, and the question of the 1988 budget will continue to be open until it is confirmed that an IGA has been finally agreed.
Mr. Taylor: It has not been agreed, then?
Mr. Brooke: Having regard to the enthusiasm of the House to bring these matters to a conclusion, I shall respond to my hon. Friend the Member for Southend, East at a later stage.
1196
In conclusion, I want to refer to the speech made by the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes). There is no pleasing the Opposition. I well recall Mr. Deakins, a former Member of this House—we miss him from these debates—constantly criticising Foreign Office Ministers for not allowing a Treasury Minister to take part in a debate. I thought that the speech made by the hon. Member for Carrick, Cumnock and Doon Valley was noisy—perhaps to cover the weakness of some of his arguments and to take us away from the experience of the Labour Government. I would agree with the hon. Gentleman and the Select Committee on Treasury and Civil Service that an inter-institutional agreement is not the equivalent of a legally binding instrument, but the proof of the pudding will be in the eating as we see how the arrangements secured at the Brussels Council evolve in future.
Question put, That the amendment be made:—
The House divided: Ayes 157, Noes 213.

Division No. 315]

[10.12 pm

AYES

Abbott, Ms Diane

Foster, Derek

Adams, Allen (Paisley N)

Foulkes, George

Archer, Rt Hon Peter

Fraser, John

Ashley, Rt Hon Jack

Galbraith, Sam

Ashton, Joe

Galloway, George

Banks, Tony (Newham NW)

Garrett, John (Norwich South)

Barnes, Harry (Derbyshire NE)

Garrett, Ted (Wallsend)

Barron, Kevin

George, Bruce

Battle, John

Gilbert, Rt Hon Dr John

Beckett, Margaret

Godman, Dr Norman A.

Bell, Stuart

Golding, Mrs Llin

Benn, Rt Hon Tony

Gordon, Mildred

Bermingham, Gerald

Gould, Bryan

Blair, Tony

Graham, Thomas

Blunkett, David

Grant, Bernie (Tottenham)

Boateng, Paul

Griffiths, Win (Bridgend)

Boyes, Roland

Hardy, Peter

Bradley, Keith

Healey, Rt Hon Denis

Bray, Dr Jeremy

Heffer, Eric S.

Brown, Gordon (D'mline E)

Henderson, Doug

Brown, Nicholas (Newcastle E)

Hogg, N (C'nauld & Kilsyth)

Brown, Ron (Edinburgh Leith)

Holland, Stuart

Buchan, Norman

Home Robertson, John

Buckley, George J.

Hood, Jimmy

Caborn, Richard

Howarth, George (Knowsley N)

Campbell, Ron (Blyth Valley)

Hoyle, Doug

Campbell-Savours, D. N.

Hughes, John (Coventry NE)

Canavan, Dennis

Hughes, Robert (Aberdeen N)

Clark, Dr David (S Shields)

Illsley, Eric

Clarke, Tom (Monklands W)

Ingram, Adam

Clay, Bob

John, Brynmor

Clwyd, Mrs Ann

Jones, Martyn (Clwyd S W)

Cohen, Harry

Kaufman, Rt Hon Gerald

Cook, Robin (Livingston)

Lamond, James

Corbyn, Jeremy

Leighton, Ron

Cousins, Jim

Lestor, Joan (Eccles)

Cox, Tom

Lloyd, Tony (Stretford)

Crowther, Stan

Lofthouse, Geoffrey

Cryer, Bob

Loyden, Eddie

Cummings, John

McAllion, John

Davies, Rt Hon Denzil (Llanelli)

McAvoy, Thomas

Dewar, Donald

McCartney, Ian

Dixon, Don

Macdonald, Calum A.

Doran, Frank

McFall, John

Dunnachie, Jimmy

McKelvey, William

Dunwoody, Hon Mrs Gwyneth

McLeish, Henry

Eadie, Alexander

McNamara, Kevin

Eastham, Ken

McTaggart, Bob

Fatchett, Derek

Madden, Max

Faulds, Andrew

Marek, Dr John

Field, Frank (Birkenhead)

Martin, Michael J. (Springburn)

Fields, Terry (L'pool B G'n)

Martlew, Eric

Fisher, Mark

Maxton, John

Flannery, Martin

Meale, Alan

1197

Michie, Bill (Sheffield Heeley)

Short, Clare

Millan, Rt Hon Bruce

Skinner, Dennis

Moonie, Dr Lewis

Smith, Andrew (Oxford E)

Morgan, Rhodri

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

Morley, Elliott

Snape, Peter

Morris, Rt Hon A. (W'shawe)

Soley, Clive

Morris, Rt Hon J. (Aberavon)

Spearing, Nigel

Mowlam, Marjorie

Steinberg, Gerry

Nellist, Dave

Stott, Roger

O'Brien, William

Strang, Gavin

O'Neill, Martin

Straw, Jack

Parry, Robert

Turner, Dennis

Pendry, Tom

Wall, Pat

Pike, Peter L.

Walley, Joan

Powell, Ray (Ogmore)

Wardell, Gareth (Gower)

Prescott, John

Wareing, Robert N.

Quin, Ms Joyce

Welsh, Michael (Doncaster N)

Radice, Giles

Wilson, Brian

Randall, Stuart

Winnick, David

Redmond, Martin

Worthington, Tony

Rees, Rt Hon Merlyn

Wray, Jimmy

Reid, Dr John

Young, David (Bolton SE)

Richardson, Jo

Roberts, Allan (Bootle)

Tellers for the Ayes:

Ruddock, Joan

Mr. Frank Haynes and

Sheerman, Barry

Mr. Allen McKay.

Sheldon, Rt Hon Robert

NOES

Alexander, Richard

Gilmour, Rt Hon Sir Ian

Arbuthnot, James

Goodhart, Sir Philip

Arnold, Jacques (Gravesham)

Goodlad, Alastair

Baker, Nicholas (Dorset N)

Goodson-Wickes, Dr Charles

Bitten, Rt Hon John

Gorman, Mrs Teresa

Boscawen, Hon Robert

Gower, Sir Raymond

Boswell, Tim

Grant, Sir Anthony (CambsSW)

Braine, Rt Hon Sir Bernard

Greenway, John (Ryedale)

Bright, Graham

Gregory, Conal

Brooke, Rt Hon Peter

Grist, Ian

Butler, Chris

Ground, Patrick

Buttertill, John

Grylls, Michael

Campbell, Menzies (Fife NE)

Gummer, Rt Hon John Selwyn

Carlisle, John, (Luton N)

Hamilton, Hon Archie (Epsom)

Carlisle, Kenneth (Lincoln)

Hamilton, Neil (Tatton)

Carrington, Matthew

Hampson, Dr Keith

Chapman, Sydney

Hanley, Jeremy

Chope, Christopher

Hannam, John

Churchill, Mr

Hargreaves, A. (B'ham H'll Gr')

Clark, Dr Michael (Rochford)

Hargreaves, Ken (Hyndburn)

Clarke, Rt Hon K. (Rushcliffe)

Harris, David

Coombs, Anthony (Wyre F'rest)

Haselhurst, Alan

Cope, John

Hawkins, Christopher

Cran, James

Hayhoe, Rt Hon Sir Barney

Currie, Mrs Edwina

Hayward, Robert

Curry, David

Heathcoat-Amory, David

Davies, Q. (Stamf'd & Spald'g)

Heddle, John

Davis, David (Boothferry)

Heseltine, Rt Hon Michael

Devlin, Tim

Hicks, Robert (Cornwall SE)

Douglas-Hamilton, Lord James

Higgins, Rt Hon Terence L.

Dunn, Bob

Hind, Kenneth

Durant, Tony

Hogg, Hon Douglas (Gr'th'm)

Dykes, Hugh

Holt, Richard

Eggar, Tim

Howard, Michael

Evans, David (Welwyn Hatf'd)

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

Evennett, David

Howarth, G. (Cannock & B'wd)

Favell, Tony

Howell, Ralph (North Norfolk)

Fenner, Dame Peggy

Howells, Geraint

Field, Barry (Isle of Wight)

Hughes, Robert G. (Harrow W)

Finsberg, Sir Geoffrey

Hunt, David (Wirral W)

Fookes, Miss Janet

Hunt, John (Ravensbourne)

Forsyth, Michael (Stirling)

Hunter, Andrew

Forth, Eric

Irvine, Michael

Fowler, Rt Hon Norman

Jack, Michael

Franks, Cecil

Johnson Smith, Sir Geoffrey

Freeman, Roger

Jones, Robert B (Herts W)

French, Douglas

Jopling, Rt Hon Michael

Gale, Roger

Key, Robert

Gardiner, George

King, Roger (B'ham N'thfield)

Garel-Jones, Tristan

King, Rt Hon Tom (Bridgwater)

1198

Kirkhope, Timothy

Renton, Tim

Knapman, Roger

Rhodes James, Robert

Knight, Greg (Derby North)

Ridley, Rt Hon Nicholas

Knowles, Michael

Ridsdale, Sir Julian

Knox, David

Rifkind, Rt Hon Malcolm

Lamont, Rt Hon Norman

Roe, Mrs Marion

Lang, Ian

Rowe, Andrew

Lawson, Rt Hon Nigel

Rumbold, Mrs Angela

Lennox-Boyd, Hon Mark

Sackville, Hon Tom

Lightbown, David

Sainsbury, Hon Tim

Lilley, Peter

Shaw, David (Dover)

Lloyd, Sir Ian (Havant)

Shaw, Sir Michael (Scarb')

Lloyd, Peter (Fareham)

Shelton, William (Streatham)

Luce, Rt Hon Richard

Shepherd, Colin (Hereford)

Lyell, Sir Nicholas

Shersby, Michael

Macfarlane, Sir Neil

Sims, Roger

MacKay, Andrew (E Berkshire)

Smith, Tim (Beaconsfield)

Maclean, David

Soames, Hon Nicholas

McLoughlin, Patrick

Speed, Keith

McNair-Wilson, M. (Newbury)

Spicer, Michael (S Worcs)

McNair-Wilson, P. (New Forest)

Squire, Robin

Major, Rt Hon John

Stanbrook, lvor

Malins, Humfrey

Stanley, Rt Hon John

Mans, Keith

Steen, Anthony

Marshall, Michael (Arundel)

Stern, Michael

Martin, David (Portsmouth S)

Stevens, Lewis

Mawhinney, Dr Brian

Stewart, Andy (Sherwood)

Mayhew, Rt Hon Sir Patrick

Stradling Thomas, Sir John

Meyer, Sir Anthony

Summerson, Hugo

Miller, Hal

Taylor, John M (Solihull)

Mills, Iain

Temple-Morris, Peter

Mitchell, Andrew (Gedling)

Thompson, D. (Calder Valley)

Monro, Sir Hector

Thompson, Patrick (Norwich N)

Montgomery, Sir Fergus

Thurnham, Peter

Moore, Rt Hon John

Townend, John (Bridlington)

Morris, M (N'hampton S)

Tracey, Richard

Morrison, Hon Sir Charles

Tredinnick, David

Morrison, Hon P (Chester)

Trippier, David

Moss, Malcolm

Vaughan, Sir Gerard

Neale, Gerrard

Waddington, Rt Hon David

Needham, Richard

Waldegrave, Hon William

Nelson, Anthony

Walker, Bill (T'side North)

Neubert, Michael

Ward, John

Nicholson, David (Taunton)

Wardle, Charles (Bexhill)

Onslow, Rt Hon Cranley

Warren, Kenneth

Oppenheim, Phillip

Watts, John

Page, Richard

Wheeler, John

Patnick, Irvine

Widdecombe, Ann

Patten, Chris (Bath)

Wiggin, Jerry

Pawsey, James

Wilkinson, John

Peacock, Mrs Elizabeth

Wilshire, David

Porter, David (Waveney)

Wood, Timothy

Portillo, Michael

Woodcock, Mike

Powell, William (Corby)

Young, Sir George (Acton)

Price, Sir David

Raison, Rt Hon Timothy

Tellers for the Noes:

Rathbone, Tim

Mr. Richard Ryder and

Redwood, John

Mr. Stephen Dorrell.

Question accordingly negatived.
Main Question put and agreed to.
Resolved,
That this House takes note of European Community Documents Nos. 10552/86 and the un-numbered Explanatory Memorandum submitted by the Treasury on 18th March 1987 on the 1987 Community Budget, the un-numbered Explanatory Memorandum submitted by the Treasury on 18th March 1987 on carry-over of appropriations from 1986 to 1987, 6037/87 on the 1987 Budget situation, 6822/87 and 7552/87 on Supplementary and Amending Budget No. 1 for 1987, 6048/87, 7211/87, COM(87)240, COM(87)677 and COM(88)81 on the 1988 Preliminary Draft Budget, 4766/88 on the 1988 Draft Budget, 4051/87 on financial engineering, 5266/88 on Own Resources 5282/88 on amendments to the Financial Regulation and the un-numbered Explanatory Memorandum submitted by the Treasury on 10th May 1988 on budgetary discipline; and endorses the Government's objectives of securing effective and binding control of Community expenditure.

Anglo-Polish Relations
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Lennox-Boyd.]
10.16 pm
Mr. Anthony Coombs: Let me say first how grateful 1 am, as are a number of other hon. Members, for the opportunity to raise matters concerning the affairs of Poland and its relations with the United Kingdom—not only because I know that these matters are of interest in particular to you, Mr. Speaker, and to a number of other distinguished Members of the House, as evidenced in various early-day motions and an Adjournment debate in January, and not only because I know that they are of great interest to Poles in this country and of course in Poland, but because the debate deals with the future of Poland. the Polish people and the principles of freedom in Poland. That, of course, has an impact on the future stability of central Europe, and on East-West relations in general.
The tragedy of Poland is the tragedy of a proud and independent people who are ruled without their consent. Although they have a great cultural and artistic tradition, despite their intellectual achievements and abilities and although they have a land rich in minerals and a large industrial base, they have been so stifled, oppressed and bureaucratised by the machinery of a Communist state that their democratic freedoms have vanished. Law, instead of becoming an instrument of civilised values, has become an instrument of oppression. Now we hear that even the official trade unions—excluding Solidarity—have had their activities outlawed, and the standard of living has sadly fallen to what can only be described as Third-world levels.
Infant mortality in Poland is the highest in Europe, and life expectancy is the lowest. The prices of food have risen by some 40 per cent. in the past two months alone. Essentials such as meat, cotton wool and even razor blades are rationed, and it has been calculated that the residual monthly income, after basic housing expenses, of a family of four with both parents working would not even cover the cost of one pair of winter shoes.
Most irresponsible of all—and most serious of all—so bad has been the organisation of Poland's mineral resources and its industry that no less than one third of the country is now classed as an area of ecological emergency. The very soil of the country is being slowly poisoned.
Why is this? The simple answer is that the economy is being ossified under an archaic and arthritic Communist system. Subsidies, price controls and a nomenclature system mean that three-quarters of the country's managers care more for their party perks than the efficiency of the enterprise they are charged to run.
The results are plain. The Centre for Research into Communist Economies shows that inflation is running at 60 per cent., that coal resources are being heavily wasted and that the external debt is £37,000 million, which is not only 50 per cent. of the gross domestic product but second only to Russia in the Communist world. Possibly most damning of all, despite the fact that there is 25 per cent. more industrial equipment in the country than there was in 1980, industrial productivity per man has fallen by one fifth. It is small wonder that, since 1980, no fewer than 700,000 Poles have decided to leave their homeland.
1200
What is the Polish Government's response? Officially they talk of democratisation, of economic reform and of the need to reduce subsidies and encourage private enterprise, but the reality is that, because they do that without the basic consent of the people, the system is only kept in place by oppression, by a denial of basic freedom and human rights, and by arbitrary surveillance and imprisonment of those who dare to question the regime and even of their children.
I am pleased to inform the House of the release of Hanna Lukowska-Karniej, Andrzej Kolodziej, Jan Andrzej Gorny and Kornel Morawiecki, all Solidarity supporters. However, all those people were imprisoned on trumped-up charges ranging from non-payment of maintenance through misappropriation of identity cards to completely fictitious acts of terrorism.
Despite this, the events of the last month show us that, if anything, the duplicity and political violence of the Communist regime in Poland have intensified. Despite assurances which were given to the Church.Mr. Morawiecki has not been allowed back from exile into his own country. No fewer than 70 Solidarity leaders and two thirds of its executive committee have been arrested. Students at Cracow university and eleswhere have been brutally beaten. Probably most heinous of all, the Communist authorities merely use the Catholic Church as a convenient intermediary for trying to settle, in its words, "a peaceful strike" at the Nova Huta steelworks in Cracow. Then, without justification or notice, they attacked the steelworks with stun grenades, tear gas and clubs in a horrifying and gratuitous display of violence. If anything demonstrates the cynicism, duplicity and contempt for democratic argument of the Polish regime, it was those events.
What can the British Government do to help reverse the position in Poland and the dangers it undoubtedly possesses for central European stability, especially in view of the Prime Minister's intended visit to Poland in October? The first thing to remember is that, although it is important, in the words of the Minister of State at the Foreign Office recently,
"to express our views strongly to the Polish authorities on human rights and to deplore the use of political violence",
and although it is important to use channels like the British Council in Warsaw, the World Service and organisations such as Medical Aid for Poland and the Jagiellonian Trust in this country, mere exhortation is not enough to produce reform within the Polish Government.
Secondly, whatever the public position of the Polish Government may be—and there are signs that certain Politburo members, especially the newer ones, are becoming aware of that—they must recognise that perestroika and attempts to reform in Russia make Mr. Gorbachev more sensitive and vulnerable to unrest in Soviet satellite countries than he has ever been before.
There are two reasons for that. First, he knows that any need for direct intervention in those countries by the Soviet Union would kill detente, which is so vital to his economic reform programme. Secondly, any need to do so would give the hardliners in Moscow precisely the arguments they want to make sure that the perestroika programme no longer takes place.
Equally, the Polish Government must inwardly he sensitive to the same issues. If they are to carry through a programme of economic reform, including the abolition of subsidies, freeing up the supply system by introducing

1201
more private sector businesses and restructuring the economy, the Polish Government and opposition recognise that that will involve a necessary austerity. The short-term effects of that austerity, if it is to be peacefully carried forward, must be mitigated. If they are to be mitigated, the Polish Government urgently need foreign credits, and that means a successful restructuring of their official foreign debts—on which they have paid no interest since 1982—more foreign investment, and more aid.
That presents the British Government with a unique opportunity to persuade its EEC, American and other partners in finance that there can be credits and there can be aid in generous quantities for Poland, but that it will be possible only on certain conditions. Those conditions must be made absolutely plain.
The first condition is that the Polish Government must ensure freedom of association and political opinion within Poland and from without into Poland. Secondly, all political prisoners must be released, and those who are presently in exile must be allowed to return home. Thirdly, the legitimate rights of trade unions and other opposition activists must be recognised and respected. Fourthly, and possibly most important, a genuine and continuing dialogue on economic and political reform must be started and continued with Polish people.
Such a course of action is realistic and imaginative. It would help to restore freedom to the Polish people, and prosperity for their country, inevitably it would mean that relations between Britain and Poland would quickly improve, and I believe that it is a course of action which the Government ought to follow, as it would offer hope for the Polish people who so desperately seek it.
10.27 pm
Sir Bernard Braine: I am grateful to my hon. Friend the Member for Wyre Forest (Mr. Coombs) for providing me with an opportunity to say a few words about our relations with Poland.
The Minister will know of my interest and involvement. I am of the generation that had good reason to be grateful for Polish courage and sacrifice during the second world war. I am of the generation that felt and still feels ashamed of the way in which our Polish comrades were abandoned by the West in 1945. I hold to the view most strongly that there can be no lasting detente between East and West until Poland, Czechoslovakia, Hungary and all the captive nations of Eastern Europe are free to determine their own destiny. That was put so eloquently by my hon. Friend that I need not say anything more about it.
It is safe to say, however, that I thought that it was also the view of Her Majesty's Government. I applauded the robust way in which my right hon. and learned Friend the Foreign Secretary earlier condemned the brutal suppression of Solidarity and the imposition of military rule. However, of late that seems to have changed somewhat. I was astonished to learn from The Sunday Times of 8 May that my right hon. and learned Friend has greater sympathy with General Jaruzelski in the Polish crisis than with the Solidarity movement. He believes, we were told, that Jaruzelski should be regarded as a patriot for safeguarding his country against Russian military intervention. Really—I thought that the Afghans had
1202
more to do with it than that. The Soviets could hardly wage war on two fronts or suppress two nations at the same time.
I am deeply concerned about that statement. The recent wave of unrest in Poland was brutally suppressed by the police. There were numerous arrests, serious injuries, heavy fines and dismissals from work, and Solidarity itself remains suppressed. I suggest that there is only one way forward for the Polish authorities, and Western Governments should be urging it repeatedly—namely, to borrow a little glasnost and perestroika from Mr. Gorbachev, who sees more openness as the means of securing real reconstruction. They should recognise that there is no way out of the mess that Communist rule has made of Poland except by recognising the natural aspirations of the Polish people to be masters in their own house.
There are two things that Her Majesty's Government can do. First, they can make it absolutely plain, as my hon. Friend the Member for Wyre Forest has done in his own way, that economic aid will be forthcoming only if the Polish Government seek a genuine partnership with Solidarity and the opposition. Secondly, they should make it plain that the inhumane treatment of Polish leaders—such as Kornel Morawiecki, who, after long imprisonment without trial, was deported without the right to return to his country—must end if the Polish Administration are to be treated as civilised. I beg my hon. Friend the Minister to make it absolutely clear that the West is ready to help the long-suffering Polish people, but only on the condition that their just aspirations are met and that the persecution ceases.
10.31 pm
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. Tim Eggar): This is the second time in less than six months that Poland has been chosen as the subject for an Adjournment debate. Poland is never far from the centre of international events. During recent weeks it has once again occupied the headlines in unhappy circumstances.
I congratulate my hon. Friend the Member for Wyre Forest (Mr. Coombs) on his choice of subject for the debate, which is of real and continuing importance. I am delighted that my right hon. Friend the Member for Castle Point (Sir B. Braine) has once again joined in the debate on Poland. Everybody in the House very much respects his long-term commitment to the Polish people and we recognise the considerable amount of time that he devotes to the interests of the Polish people. I recognise that because I know that he was in contact with my office last week on behalf of Mr. Morawiecki. We are delighted to say that we have been able to grant him a visa to come from Vienna to the United Kingdom in what I think my right hon. Friend will agree was rapid time.
In the House on 11 January, my hon. and learned Friend the Member for Putney (Mr. Mellor) reviewed Britian's relations with Poland and developments since the emergence of Solidarity in 1980 and 1981. He acknowledged the importance of Poland in East-West relations and the breadth and significance of links between our two countries. Those links are deep and lasting. Their origins lie in distant and recent wartime history. They are

1203
strengthened by commercial, cultural and personal ties that set our relations with Poland apart, in many repects, from those with other countries in eastern Europe.
The political and economic conditions in Poland are not, for hon. Members or for many of their constituents, matters of cold theory. They are matters of immediate practical concern. I class myself as one who is affected by that, because until recently I had the benefit of a Polish uncle.
As my hon. and learned Friend said in the debate in January, we were glad to welcome the Polish Foreign Minister, Professor Orzechowski, to London in December. That visit acknowledged what seemed like a new and welcome approach by the Polish authorities: a more resolute attitude towards the many challenges that confronted their country. All those in prison on clearly political charges had been released in September 1986. Plans for economic reform had taken more coherent shape and the need for political reform was at last officially acknowledged.
I should like now to say a few words about the Polish economy and about the Government's approach to Poland's economic difficulties. The Polish economy is burdened with a growing external debt that now amounts to about $39 billion. It is also burdened with low productivity, as my hon. Friend the Member for Wyre Forest said, and by excess demand. Recovery of the economy will come about only through a determined attack on the economic causes of those problems. It will also come about only if the Polish people can be brought to understand the need for sacrifices and can be persuaded that those sacrifices are worth while.
Our long-standing trade links and the sizeable Polish community in Britain provide a solid base for further expansion of trade between our two countries. Despite Poland's current financial difficulties, worthwhile opportunities exist for increasing trade in a number of sectors. But future trade prospects must depend on the scale and direction of Poland's economic recovery. A Polish economy restored to vigour and success is in British, as well as Polish, interests.
We recognise that long-term Western assistance will be needed for this recovery. Britain strongly supports the principle of an IMF programme for Poland, subject to that programme's terms being satisfactory. Once an IMF programme is in place, it is possible to envisage new forms of co-operation—for instance, International Bank for Reconstruction and Development co-financing schemes and fresh medium and long-term credits, targeted on export-earning projects—but we first need the assurance that sound economic policies will be pursued with the IMF's seal of approval. Ambitious plans for massive Western economic assistance to Poland, in the absence of these conditions, are not realistic.
Hon. Members have suggested, tonight and on previous occasions, that political conditions should be attached to decisions in these economic areas. Frankly, I do not agree. Polish economic recovery will come about only as a result of motivation and persuasion, not of coercion. The same vital principle applies to relations between Western countries and the Polish authorities. It would be an error to prescribe persuasion as a solution to Poland's internal problems, and to seek by contrast to use political coercion as a means of solving Poland's economic difficulties. Thus, Western official debt relief for Poland is
1204
negotiated in the Paris Club on technical, rather than political, grounds. Those are the same criteria as are applied to non-Communist countries.
Political factors do not determine the Government's approach to new credits, either. We favour a step-by-step approach to the normalisation of financial and credit relations with Poland, starting with the resumption of short-term credit cover. After that, progress will depend upon Polish performance in honouring existing debt-restructuring agreements. A steady but critical dialogue with the Polish authorities is needed, from within and outside Poland.
My hon. Friend the Member for Castle Point spoke about an article in the Sunday Times on 8 May. That article was not an accurate reflection of the views of my right hon. and learned Friend the Secretary of State for Foreign and Commonwealth Affairs. To learn about those views it is necessary to refer to the Foreign and Commonwealth Office statement of 6 May, which commented on what were then recent events. That statement deplored the use of police violence in pursuing the objective of reform and called upon the Polish authorities to recognise the importance of individual liberties and freedom of association.
That national statement of 6 May was followed on 10 May by a statement on behalf of the Twelve by the Federal Republic of Germany in its capacity as current President of the European Community. That statement reminded the Polish authorities of their international commitments to human rights and called for the release of those arrested during the recent strikes.
My right hon. and learned Friend the Foreign Secretary made clear in yet another statement on 12 May. which is available in the Library, his view that the Polish Government's plans for economic reform deserved support because they offered the prospect of a better life for the Polish people. Those economic plans involve short-term sacrifices but, of course, they will have little effect unless the Polish people are prepared and willing to support them.
Those statements show the extent to which The Daily Telegraph was in error when, on 13 May, in a leading article, it accused the Foreign and Commonwealth Office of failing to encourage dissident groups in eastern Europe and of maintaining—it is almost unbelievable that The Daily Telegraph said this—a "stony silence" during the recent crisis in Poland.
That leading article was a deplorable distortion of the Government's policy. Getting the Soviet Union and its allies to live up to their human rights commitments is fundamental to the Government's policy. As my hon. and learned Friend the Minister of State, Foreign and Commonwealth Office said in a speech at the CSCE review meeting in Vienna last month, we are not prepared to leave the Vienna conference without real progress on human rights. My hon. and learned Friend made it clear that what our Soviet colleagues have called a "common European home" could not be achieved with barbed wire in the garden and secret policemen in the cellar.
The Government are worried that once again prisoners should be held in Poland for political reasons. As my right hon. and hon. Friends have said, recent arrests and sentences have included senior members of Solidarity. Some of those imprisoned have been released, and that is welcome. As my hon. and learned Friend said in January,

1205
there are some people in prison in Poland on criminal charges, but arguably there is a political element in the charges.
The Government share the concern that my right hon. and hon. Friends have expressed about imprisonment in Poland for political reasons and on many occasions we have made those concerns clear to the Polish authorities. Such imprisonments cannot but damage prospects for improved relations between Britain and Poland. They are an obstacle to Poland's plans for effective economic reform. They represent a return to the discredited policies of the past.
As the House knows, my right hon. Friend the Prime Minister has accepted an invitation to visit Poland. She hopes that circumstances will make it possible for the visit to take place before the end of the year. In her discussions with General Jaruzelski and the Polish leadership, as well as with Mr. Lech Walesa and representatives of independent opinion, she will, I am sure, wish to reflect the concerns that have been expressed in this debate. In
1206
particular, she will wish to refer to the essential relationship between political and economic reform, and I am positive that she will stress the need for human rights to be respected in Poland.
The pressures within Polish society have once again burst to the surface in recent weeks. There is no lack of energy, talent and commitment in Poland, if only they can be harnessed, but the Polish people have shown again and again that they will not put their shoulders to the wheel unless their interests are taken into account. For the reasons that I have given, I do not believe that Governments outside Poland should set political conditions for economic or financial help, but Poland's leaders must recognise that they will never get Poland's economy back on its feet without consultation, dialogue, and respect for individual freedom and initiative. I hope that the events of recent weeks will convince those leaders that that is the only path to the economic revival that we in this country most earnestly wish to see.
Question put and agreed to.
Adjourned accordingly at Fifteen minutes to Eleven o'clock.

SCOTLAND

  Health Services (Parents)
  Mrs. Fyfe
  To ask the Secretary of State for Scotland whether he has considered taking steps to improve the links between health services and local authority nurseries so as to offer health screening and health education for parents.

  Mr. Michael Forsyth
  I am not convinced that as presently organised local authority nurseries are the most appropriate places to offer health screening and health education for parents. As I announced last year, we are providing for comprehensive national screening programmes for both breast and cervical cancer.

  Rating Reform
  Mr. Worthington
  To ask the Secretary of State for Scotland if he will estimate the impact of a uniform business rate in England and Wales in 1990 on Scottish commerce and industry.

  Mr. Lang
  There is no reliable basis on which such an estimate could be made, since the combined effects of the revaluations due on both sides of the border in 1990, and the introduction of uniform business rates in England and in Wales, are not yet known.

  "You and the Community Charge"
  Mr. Allen Adams
  To ask the Secretary of State for Scotland how many requests his Department has received from members of the public for copies of the leaflet "You and the Community Charge".

  Mr. Lang
  A total of 776 requests for copies had been
  received up to Friday 13 May.

  NHS Waiting Lists
  Mrs. Fyfe
  To ask the Secretary of State for Scotland what is the current average waiting time for in-patient treatment in National Health Service hospitals in Scotland.

  Mr. Michael Forsyth
  The mean waiting time for inpatient treatment during 1986, which is the latest year for which figures are available, was 71 days.

  Nuclear Waste (Caithness)
  Mr. Dalyell
  To ask the Secretary of State for Scotland what study he has made of the potential dangers of radioactive decommissioning and nuclear waste management in the Caithness area.

  Lord James Douglas-Hamilton
  As part of his responsibility for radioactive waste management strategy, my right hon. and learned Friend has full regard to the 516
  need to dispose safely of wastes from any decommissioning of nuclear facilities. The studies which have been carried out both in this country and overseas indicate that decommissioning of nuclear facilities can be carried out safely on the basis of existing technology. The radiological problems which decommissioning wastes present in disposal terms are not significantly different from those of other wastes from the nuclear industry.

  Local Authority Expenditure
  Mr. Allan Stewart
  To ask the Secretary of State for Scotland what action he proposes to take in the light of local authorities' budgets and rates for 1988–89; and if he will make a statement.

  Mr. Malcolm Rifkind
  [pursuant to his reply, 3 May 1988, c. 383]: I have now completed my consideration of the planned expenditure of district councils. I do not propose to take selective action to reduce the rate of any of these councils.

  In order to encourage all authorities with planned overspends to reconsider their budgets in the course of the year, I have decided after consultation with the Convention of Scottish Local Authorities that there will be grant penalties for overspending on a tariff starting at zero and rising to 10 per cent, for a 2 per cent, overspend, 60 per cent for a 4 per cent, overspend and 110 per cent, for an overspend of 5 per cent, or more. The rate of increase between each of these points is even (linear). On the basis of planned expenditure the total penalty will be £140 million, the approximate level by which authorities are planning to overspend.

  Penalties will subsequently be adjusted in the light of actual expenditure. In 1987–88 many authorities reduced their expenditure in the course of the year and as a result will recover £89 million in grant in respect of that year. I hope the same will happen in 1988–89.

  I am laying the necessary rate support grant order today to allow repayments of grant in respect of 1987–88 and to give effect to grant penalties for 1988–89.

OVERSEAS DEVELOPMENT

  Nicaragua
  Mr. Tom Clarke
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will publish a table in the Official Report showing in ranked order the per capita contributions made by OECD member countries to Nicaragua for the latest year for which figures are available.

  Mr. Chris Patten
  The information requested is as follows:

  Net official development assistance from Development Assistance Committee Donor Countries to Nicaragua in 1986

  Donor

  Net official development assistance $ million

  Per capita $

  Norway

  11·46

  2·750

  Sweden

  17·54

  2·096

  Finland

  7·13

  1·449

  Netherlands

  19·19

  1·318

  Denmark

  3·22

  0·629

  Switzerland

  3·61

  0·550

  517

  Donor

  Net official development assistance $ million

  Per capita $

  France

  14·11

  0·255

  Italy

  13·70

  0·239

  Austria

  1·28

  0·169

  Canada

  4·32

  0·168

  Germany

  8·00

  0·131

  Belgium

  0·65

  0·066

  Australia

  0·08

  0·005

  United Kingdom

  0·13

  0·002

  Japan

  0·16

  0·001

  Source: Development Assistance Committee Chairman's Report.

  Figures cover members of the Development Assistance Committee of the OECD. No details are available for other OECD countries. The figures reflect bilateral aid. The United Kingdom share of multilateral (mainly European Community) aid in 1985 was of the order of $4 million. Statistics are not available which would show the amounts other Development Assistance Committee donor countries provided to Nicaragua through multilateral channels; nor is the United Kingdom figure for 1986 yet available.

ENERGY

  Advanced Gas-cooled Reactors
  Dr. Thomas
  To ask the Secretary of State for Energy (1) if he will request Her Majesty's Chief Inspector of Nuclear Installations to review the licensing of advanced gas-cooled reactors;

  (2) if he will request Her Majesty's Chief Inspector of Nuclear Installations to investigate the problem of advanced gas-cooled reactor fuel assembly vibration and fuel rod fracture potential.

  Mr. Michael Spicer
  Operators of all AGR stations must comply with the stringent safety requirements of the Health and Safety Executive's Nuclear Installations Inspectorate in order to secure consent for continued operation. The licensing of AGRs is the subject of continuous review by the NII.

  The NII is fully aware of the present position regarding fuel assembly vibration and fuel rod fracture potential in AGRs and of the further work being done on these issues.

  Pressurised Water Reactor (Research and Development)
  Dr. Thomas
  To ask the Secretary of State for Energy what is the expenditure from 1975 to date on pressurised water reactor research and development by (i) the Central Electricity Generating Board, including direct expenditure and the cost of research and development subcontracted to the United Kingdom Atomic Energy Authority, (ii) the Nuclear Installations Inspectorate, including direct expenditure and the cost of research and development subcontracted to the United Kingdom Atomic Energy Authority, and (iii) the United Kingdom Atomic Energy Authority, excluding research and development subcontracted for the Central Electricity Generating Board and Nuclear Installations Inspectorate, and what is the forecast for such expenditure for 1989–92.

  Mr. Michael Spicer
  The following table sets out expenditure on PWR research and development by the 518
  Central Electricity Generating Board, the Health and Safety Executive's Nuclear Installations Inspectorate and the Department of Energy in the period 1975 up to the end of the financial year 1987–88, and expected expenditure for 1988–89:

  CEGB1

  HSE(NII)2

  D/Energy3

  £ million

  £ million

  £ million

  Up to 1988

  140

  7·5

  99

  1988–89

  39

  0·5

  7

  1 Includes both direct expenditure and the cost of work subcontracted to the UKAEA.

  2 This represents expenditure on PWR safety studies and includes payments to the UKAEA. Expenditure prior to 1980 cannot be separately distinguished and is not included. The expenditure is recoverable from the nuclear site licensee.

  3 This is expenditure with the UKAEA. Expenditure prior to 1977 cannot be separately distinguished and is not included.

  Expenditure in future years has not yet been determined.

PRIME MINISTER Health

  Service Review
  Mr. Barry Field
  To ask the Prime Minister how many representations she has received about the Health Service review; and if she will break down the representations into categories of sender.

  The Prime Minister
  I have received a number of such representations, from individual members of the public, those employed in the Health Service and professional bodies of various kinds. These have been forwarded to my right hon. Friend the Secretary of State for Social Services so that he can consider them in the context of the review now under way. Information in the precise form requested is not available.

  Turkey
  Mr. Corbyn
  To ask the Prime Minister what discussions she had during her visit with the Government of Turkey concerning(a) human rights and (b) the legal proceedings against Dr. Sargin and Mr. Kutlu, and allegations of torture.

  The Prime Minister
  I refer the hon. Gentleman to the reply that I gave to the hon. Member for Meirionnydd Nant Conwy (Dr. Thomas) on 20 April 1988, at column 435.

  Mr. Corbyn
  To ask the Prime Minister what discussions she had during her recent visit to Turkey concerning the legal proceedings against Mr. Oz, Mr. Cosku, Mr. Ozdo Jan and 11 others.

  The Prime Minister
  None.

  Mr. Corbyn
  To ask the Prime Minister what discussions she had during her recent visit to Turkey concerning the freedom of opposition and expression and the legal functioning of political parties.

  The Prime Minister
  These subjects were mentioned in the course of my discussions with Mr. Inonu.

  Mr. Corbyn
  To ask the Prime Minister whom she met during her recent visit to Turkey; and which towns she visited.

  The Prime Minister
  I had talks with President Evren, Prime Minister Ozal, the Social Democrat leader Mr.
  519
  Inonu, and the lord mayor of Istanbul Mr. Dalan. I went to Ankara and Istanbul. In both cities I visited a number of projects involving British companies and met those concerned.

  Ministers' Engagements
  Mr. Tony Lloyd
  To ask the Prime Minister what advice she gives to Ministers about distinguishing between party political meetings and those they attend in an official capacity.

  The Prime Minister
  None. Ministers are aware of the distinction and no advice is necessary.

  Engagements
  Mr. Tony Banks
  To ask the Prime Minister if she will list her official engagements for Thursday 19 May.

  Mr. Hardy
  To ask the Prime Minister if she will list her official engagements for Thursday 19 May.

  Mr. Stern
  To ask the Prime Minister if she will list her official engagements for Thursday 19 May.

  Mr. Ieuan Wyn Jones
  To ask the Prime Minister if she will list her official engagements for Thursday 19 May.

  Dr. Thomas
  To ask the Prime Minister if she will list her official engagements for Thursday 19 May.

  Mr. Pike
  To ask the Prime Minister if she will list her official engagements for Thursday 19 May.

  The Prime Minister
  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.

EDUCATION AND SCIENCE

  Voluntary Schools
  Ms. Ruddock
  To ask the Secretary of State for Education and Science how many times section 14 of the Education Act 1944 has been used; and in what circumstances it is his policy to use section 14 of the Education Act 1944 instead of sections 12 and 13 of the Education (School Premises) Regulations 1981.

  Mr. Dunn
  The Department does not keep a central record of the number of times section 14 has been used. It is for the governors of voluntary schools, rather than for the Secretary of State, to initiate any action under this section. Sections 12 and 13 of the Education (School Premises) Regulations 1981 have no bearing on the matter, since they are concerned only with school medical and staff accommodation.

  City Technology Colleges
  Ms. Ruddock
  To ask the Secretary of State for Education and Science if he intends to apply the minimum standard contained in the Education (School Premises) Regulations 1981 to city technology colleges.

  Mrs. Rumbold
  City technology colleges, in line with several maintained schools in similar circumstances, are likely to provide rather more generous standards of accommodation than the minima prescribed in the 520
  regulations. Among the factors to be taken into account are the proposed curriculum emphasis on technology and science and a ratio of teachers to pupils which is characteristic of secondary schools in urban areas.

  Education Reform
  Mr. Tony Lloyd
  To ask the Secretary of State for Education and Science what recent representations he has received or heard about proposals to reorganise or cancel the proposed reorganisation of secondary education in the borough of Trafford.

  Mr. Dunn
  My right hon. Friend has received various communications about the reorganisation proposals published by Trafford local education authority on 21 January 1988. No formal notification that the authority has withdrawn the proposals has so far been received.

  Mr. Tony Lloyd
  To ask the Secretary of State for Education and Science what steps he takes to ensure that he maintains impartiality in considering the merits of proposals by local education authorities to reorganise schools.

  Mr. Dunn
  My right hon. Friend considers on their individual merits all reorganisation proposals which come before him for decision. In so doing he takes careful account both of the arguments put forward by local education authorities in support of their proposals and of the points made by any objectors to the proposals. The general criteria against which my right hon. Friend considers reorganisation proposals are set out in the Department's circular 3/87

  Economic and Social Research Council
  Mr. Blunkett
  To ask the Secretary of State for Education and Science when he expects Professor Peter Hall to take up his appointment as chairman of the Economic and Social Research Council; and if he will make a statement.

  Mr. Jackson
  I have been informed by Professor Hall that he does not now propose to assume the chairmanship of the council.

  Mr. Blunkett
  To ask the Secretary of State for Education and Science if he will make a statement on the role of the chairman of the Economic and Social Research Council in promoting social science research.

  Mr. Jackson
  The role of the chairman is to pursue, with members of the council, the objects of the ESRC as set out in its charter, and to ensure that its functions are carried out efficiently and effectively.

  Mr. Blunkett
  To ask the Secretary of State for Education and Science what steps he is taking to ensure that any disruption caused by the Economic and Social Research Council's move to Swindon will not adversely affect the work of the council as an independent research council.

  Mr. Jackson
  The detailed arrangements for ESRC's move to Swindon are matters for the council itself. My right hon. Friend has, however, allocated resources to assist the council in meeting the costs arising from relocation.
  521
  Mr. Blunkett
  To ask the Secretary of State for Education and Science if he will list the members of the Economic and Social Research Council.

  Mr. Jackson
  The information is as follows:

  Acting Chairman and Secretary

  Mr. David Stafford

  Members

  Mr. B. Allison— Chairman and Chief Executive, Business Systems Ltd.

  Professor G. Bain—Professor of Industrial Relations, Warwick University

  Dr. W. Birch, PhD— Formerly Director, Bristol Polytechnic

  Professor J. Blondel— Professor of Political Science, European Univesity Institute, Florence

  Professor G. Brown—Professor of Applied Linguistics, University of Essex

  Mr. I. C. R. Byatt/Deputy Chief Economic Adviser, HM Treasury.

  Mr. A. M. G. Christopher, CBE—General Secretary, Inland Revenue Staff Federation

  Sir Hugh Cortazzi, GCMG— Former British Ambassador to Japan, Director Hill-Samuel & Co

  Mr. G. Davies—Chief Economist, Goldman Sachs

  Professor J. G. Edwards, DM, FRCP, FRCPsych—Professor of Addiction Behaviour University of London Institute of Psychiatry

  Sir Christopher Foster—Commercial Adviser to British Telecom Plc

  Professor H. Hanham—Vice Chancellor, University of Lancaster

  Dr. R. G. L. McCrone, CB, FRSE—Chief Economic Advisor, Industry Department for Scotland

  Professor A. Maynard— Director ESRC Centre for Health Economics, York

  Dr. J. Metters, FRCOG— Deputy Chief Scientist, Department of Health and Social Security

  Professor H. Newby— Professor of Sociology and Director of ESRC Data Archive, University of Essex

  Mr. A. Noble—Chairman, British Retail Association

  Professor K. Thomas, FBA—President, Corpus Christi College, Oxford

  Dr. G. Winfield—Chief Executive, Overseas Division, BOC Group

  Mr. Blunkett
  To ask the Secretary of State for Education and Science whether suitable, permanent accommodation has now been acquired to house the Economic and Social Research Council in Swindon.

  Mr. Jackson
  Accommodation has been found to house ESRC in Swindon from August this year. The council will remain there until the permanent accommodation at Polaris house (alongside the Natural Environment Research Council and the Science and Engineering Research Council) is available in 1990–91.

  Mr. Blunkett
  To ask the Secretary of State for Education and Science how many members of the administrative staff of the Economic and Social Research Council have so far indicated their willingness to move to Swindon with the Economic and Social Research Council.

  Mr. Robert Jackson
  Twenty two staff have indicated a willingness to move permanently, and nine to move at least for a period. Others are still considering their position.

  Mr. Blunkett
  To ask the Secretary of State for Education and Science what is the current approved establishment of senior adminstrators at the Economic and Social Research Council; how many are currently in post; how many have resigned in the last 12 months; and how many have tendered their resignations in the last 12 months.
  522
  Mr. Jackson
  The current approved establishment of senior administrators at ESRC is 19; 18 are currently in post; two have resigned in the last 12 months; and three have tendered their resignations (including the two who have resigned).

TRANSPORT

  Anti-lock Braking Devices
  Mr. Fry
  To ask the Secretary of State for Transport whether he has any plans to introduce regulations to require the fitting of anti-lock braking devices to new motor vehicles.

  Mr. Peter Bottomley
  We are preparing draft regulations based on Community directive 88/194/EEC which will require anti-lock braking systems to be fitted to the following new vehicles first registered on or after 1 October 1991:

  Towing vehicles over 16 tonnes gross weight;

  Trailers over 10 tonnes gross weight;

  Coaches over 12 tonnes gross weight.

  We have no plans for mandatory anti-lock braking for other categories of vehicle. We do welcome the general increase in their fitment.

  M25 Motorway
  Mr. Adley
  To ask the Secretary of State for Transport if he will make a statement on the reasons why he has sanctioned the construction of additional lanes on the M25; what are the hours of day at which congestion reaches saturation point on those stretches; and if he will tabulate for a typical 24-hour period on a week day the level of traffic on this section of the motorway, taking the heaviest period as 100.

  Mr. Peter Bottomley
  Fourth lanes in each direction are being provided between junctions 11 and 13 to relieve congestion, particularly during peak hours.

  The Department does not normally measure journey times or queue lengths, which vary from day to day according to conditions. Traffic flows on a typical 24-hour week day between junctions 11 and 12 are as follows:—

  Hours

  Hourly flow

  Prop. of peak

  1

  667

  6·64

  2

  309

  3·07

  3

  238

  2·37

  4

  219

  2·18

  5

  319

  3·17

  6

  897

  8·93

  7

  3,306

  32·92

  8

  8,809

  87·74

  9

  9,298

  92·60

  10

  8,773

  87·38

  11

  8,670

  86·35

  12

  7,361

  73·31

  13

  6,435

  64·10

  14

  6,294

  62·68

  15

  6,672

  66·45

  16

  7,371

  73·41

  17

  8,671

  86·36

  18

  10,040

  100·00

  19

  9,146

  91·10

  20

  5,816

  57·92

  21

  3,328

  33·14

  22

  2,282

  22·72

  23

  1,854

  18·46

  24

  1,521

  15·14

  523
  Total 24 Hour Flow =118,300.

  Annual Average Daily Flow= 117,900.

  Channel Tunnel
  Mr. Adley
  To ask the Secretary of State for Transport what has been the increase in rail traffic between the date of the first drafting of the Channel Tunnel Bill and the latest date for which figures are available on that section of the line to be utilised by Channel tunnel trains(a) between Sevenoaks and Orpington and (b) between Tonbridge and Orpington.

  Mr. David Mitchell
  I am told by British Rail that information is not available in the form requested. However, the number of morning peak passengers arriving at London terminal stations on BR's south eastern main line outer services, which include services on the sections of route specified by my hon. Friend, increased by 8·3 per cent. between 1986 and 1987. BR estimates that it will rise by a further 3 to 3·5 per cent. between 1987 and 1988.

  Settle to Carlisle Railway
  Mr. Cryer
  To ask the Secretary of State for Transport, pursuant to his answer on the Settle-Carlisle railway line on 16 May,Official Report, columns 677–84, what is the period of time for which British Rail is prepared to guarantee the provision of a substitute bus service.

  Mr. David Mitchell
  Under the Transport Act 1985 British Rail may not withdraw a subsidised guaranteed bus service without the Secretary of State's consent, so the question of the board's willingness to run such a service does not arise.

  Mr. Cryer
  To ask the Secretary of State for Transport, pursuant to his answer on the Settle-Carlisle railway line on 16 May,Official Report, columns 677–84, what running rights would be available to any private sector operator of the Settle-Carlisle railway into (a) Carlisle, (b) Hellifield, (c) Skipton, (d) Clitheroe or (e) Blackburn; and if such facilities have been discussed with the chairman of British Rail or any other British Rail officials.

  Mr. David Mitchell
  There are matters to be negotiated in the first instance between British Rail and any prospective private operator.

  Mr. Cryer
  To ask the Secretary of State for Transport, pursuant to his answer on the Settle-Carlisle railway line on 16 May,Official Report, columns 677–84, if he will list the structural liabilities on the Settle-Carlisle route which would he taken over by any private sector operator; whether obligations on 144 miles of lineside fencing would be removed; and what requirements on the provision of services and the retention of railway facilities would fall on any private purchasers.

  Mr. David Mitchell
  The structural liabilities to be transferred are a matter for negotiation between British Rail and any prospective purchaser of the line. It would be for such an operator to decide what services to offer; there is no statutory power for Ministers of British Rail to impose any obligation in this respect.

  Mr. Cryer
  To ask the Secretary of State, for Transport, pursuant to his answer on the Settle-Carlisle railway line on 16 May,Official Report, columns 677–684, if his calculations of revenue credited to the Settle-Carlisle
  524
  railway reflected the diversion of freight services away from the route by British Rail; and whether his estimate of revenue included revenue from diversions of passenger trains in the fiscal year ended 5 April.

  Mr. David Mitchell
  Decisions on the routeing of freight services are made by British Rail on a commercial basis. There was no case therefore for attributing any revenue to the Settle-Carlisle railway on account of British Rail's previous decisions to use different routes for its freight trains. The cost and revenue implications of using alternatives to the Settle-Carlisle line for the diversion of passenger trains were taken into account when assessing the case for closure.

  Bus Doors
  Dame Jill Knight
  To ask the Secretary of State for Transport what steps he proposes to take to ensure that bus doors are fitted with safety devices which would prevent their closing and the bus moving off while a traveller's arm or leg is trapped in them; and if he will make a statement.

  Mr. Peter Bottomley
  We share my hon. Friend's concern about the safety of bus doors. In February we put proposals for new safety regulations to deal with this problem to the Bus and Coach Council, London Regional Transport and the Society of Motor Manufacturers and Traders.

  I shall be meeting representatives of the bus industry on 21 June to discuss points which the Bus and Coach Council and the SMMT have brought to our attention.

  Passenger Ships (Stability)
  Mr. David Shaw
  To ask the Secretary of State for Transport if he will give details of the United Kingdom's contribution to recent work in the International Maritime Organisation on new stability standards for passenger ships; and if he will relate this work to other work being carried on in his Department on ship stability following the report of the court of formal investigation into the loss of the Herald of Free Enterprise.

  Mr. Channon
  All roll-on/roll-off ferries operating in British waters meet international standards of safety. To enhance the survivability of this type of ship following major collision damage the International Maritime Organisation has, as I told my hon. Friend on 3 March, at columns 651–54, been developing for several years, and with the United Kingdom's support, improved standards for damage stability requirements. A meeting of the IMO's sub-committee on stability and load lines and on fishing vessel safety last August reported on proposals for revised standards; and my Department commissioned a research project to evaluate the impact of the proposed new standards on roll-on/roll-off ferries, which was to be completed before the new proposals were presented to the IMO's maritime safety committee in April.

  The results of that work were put to the IMO in a United Kingdom paper, MSC 55/INF.12, which was circulated to all delegations attending the committee. They show that, relative to the standards currently applying to new ships, the proposed standards would bring about a significant improvement in the survivability of new passenger ships after a major collision. Of a representative sample of 10 ships examined, all of which fully meet the

  525
  standards that were applicable when they were built, two would meet the proposed new standards without design changes. I am placing a copy of the paper in the Library.

  The maritime safety committee, with the United Kingdom's support, endorsed the proposals and it is expected that they will be formally adopted in October for inclusion in the international convention on the safety of life at sea for application to new ships to be built after an agreed future date. The United Kingdom will be pressing for an early implementation date.

  This work in the IMO was in progress before the loss of the Herald of Free Enterprise, and has not been undertaken in response to any recommendation of the court of formal investigation into that accident. As my hon. Friend knows from the answer I gave him on 3 March, related work being carried out in my Department in response to the recommendations in the report of that court consists of:

  (a) an assessment of all United Kingdom roll-on/rolloff ferries built before the last substantial improvement in damage stability requirements came into force in 1980;

  (b) a research programme to examine specific ways, through design changes, of reducing the risk of large volumes of water reaching the car deck of a roll-on/ roll-off ferry, and to prevent such an event leading to a capsize.

WALES

  Valleys Initiative
  Mr. Gareth Wardell
  To ask the Secretary of State for Wales if he will publish in the Official Report the expected date of publication of his valleys initiative.

  Mr. Peter Walker
  I will be announcing my plans for the valleys when I have completed consultations with a range of authorities and organisations involved in the valleys.

  River Rhymney (Pollution)
  Mr. Ron Davies
  To ask the Secretary of State for Wales if he will make a statement concerning the pollution of the River Rhymney, Mid Glamorgan, on the morning of 16 May.

  Mr. Grist
  Welsh Office officials have been advised by the Welsh water authority of the incident in which a small number of fish died. The authority's tracing of the source of the pollution may result in its taking legal action, and in these circumstances it would not be reasonable for me to comment.

  Water Quality
  Mr. Ron Davies
  To ask the Secretary of State for Wales what plans he has to review the levels of expenditure by the Welsh water authority on the enhancement of water quality; and if he will make a statement.

  Mr. Grist
  The Welsh water authority sets and reviews periodically the level of expenditure it considers appropriate to each of the functions for which it has responsibility.

  Mr. Ron Davies
  To ask the Secretary of State for Wales if he will invite the Welsh water authority to conduct a526
  survey of water quality problems and the provision of sewerage facilities in the Rhymney valley; and if he will make a statement.

  Mr. Grist
  In discharging its statutory functions the Welsh water authority monitors the quality of waters and assesses the needs for sewerage facilities throughout its area. In the case of the Rhymney valley, the survey of water quality is undertaken by the south-east division of the Welsh water authority.

  Railway Crossings
  Mr. Roy Hughes
  To ask the Secretary of State for Wales what progress there has been on the implementation of the Stott report about railway crossings in Wales.

  Mr. Peter Walker
  This is a matter for my right hon. Friend the Secretary of State for Transport. He has accepted the recommendations of the Stott report in principle and is discussing their implementation with British Rail.

  Mr. Roy Hughes
  To ask the Secretary of State for Wales what proposals he has for the installation of automatic-open level crossings fitted with barriers in Wales.

  Mr. Peter Walker
  None. This is a matter for British Rail in association with the railways inspectorate of the Department of Transport.

EMPLOYMENT

  Age Discrimination
  Mr. Nicholas Baker
  To ask the Secretary of State for Employment if he plans to introduce a code of practice similar to that of the Institute of Personnel Management aimed at eliminating age discrimination in job recruitment.

  Mr. Lee
  The Government support the principles set out in the Institute of Personnel Management's code of practice. At the present time we have no plans to introduce an official code of practice, but I am happy to commend the institute's code to all employers.

  Textiles
  Mr. Tom Clarke
  To ask the Secretary of State for Employment how many people were employed on a full-time basis in the textile industries of each of the member countries of the European Community in 1979 and 1986.

  Mr. Lee
  International comparisons of labour market statistics should be treated with caution as it is difficult to obtain data for different countries on a consistent basis.

  The available data, shown in the table, do not cover all European Community countries, are limited to 1979 and 1985 and refer to all employees in the textile industries.

  Employees in the textile industries

  1979

  1985

  Belgium

  68,400

  60,900

  Denmark

  15,000

  14,500

  France

  298,500

  236,600

  Germany

  338,900

  261,400

  Ireland

  18,500

  8,800

  Netherlands

  34,600

  21,500

  Spain

  245,800

  164,800

  United Kingdom

  339,000

  240,100

  527
  Source: Employment and Unemployment 1987 (Eurostat).

  ACAS
  Mr. Hayward
  To ask the Secretary of State for Employment if he has any plans to meet the chairman of the Advisory Conciliation and Arbitration Service to discuss the present state of industrial relations in Britain.

  Mr. Nicholls
  My right hon. Friend has no such plans.

  International Standardised Unemployment Rates: Annual Averages

  1974

  1975

  1976

  1977

  1978

  1979

  1980

  1981

  1982

  1983

  1984

  1985

  1986

  1987

  Belgium

  3·0

  5·0

  6·4

  7·4

  7·9

  8·2

  8·8

  10·8

  | 12·6

  12·1

  12·1

  11·3

  11·2

  10·9

  Denmark

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  (9·5)

  (9·2)

  (7·6)

  (5·8)

  (5·9)

  France

  2·8

  4·0

  4·4

  4·9

  5·2

  5·9

  6·3

  7·4

  8·1

  8·3

  9·7

  10·2

  10·4

  10·8

  Germany

  1·6

  3·6

  3·7

  3·6

  3·5

  3·2

  3·0

  4·4

  6·1

  8·0

  | 7·1

  7·2

  6·5

  6·5

  Greece

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  (9·0)

  (9·3)

  (8·7)

  (8·2)

  (8·0)

  Ireland

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  (15·2)

  (17·0)

  (18·4)

  (18·5)

  11·92)

  Italy

  5·3

  5·8

  6·6

  7·0

  7·1

  7·6

  7·5

  8·3

  9·0

  9·8

  10·2

  10·5

  | (10·6)

  (11·0)

  Luxembourg

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  (3·6)

  (3·0)

  (2.9)

  (2·7)

  (3·1)

  Netherlands

  2·7

  5·2

  5·5

  5·3

  5·3

  5·4

  6·0

  8·5

  11·4

  | 12·0

  11·8

  10·6

  9·9

  9·6

  Portugal

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  n.a.

  7·9

  8·4

  8·5

  8.5

  (6·8)

  Spain

  2·6

  3·6

  4·6

  5·2

  6·9

  8·5

  11·2

  13·9

  15·8

  17·2

  20·0

  21·4

  21·0

  20·1

  United Kingdom

  2·9

  4·3

  5·6

  6·0

  5·9

  5·0

  6·4

  9·8

  11·3

  12·5

  | 11·7

  11·2

  11·2

  10·3

  Note: OECD's standardised unemployment rates are used where available. For those EC countries for which no OECD standardised rates are available, similar harmonised rates compiled by the Statistical Office of European Communities (Eurostat) are shown in brackets.

  n.a.— No standardised or harmonised rates available.

  |— Break in series.

DEFENCE

  Rosyth Base
  Mr. Gordon Brown
  To ask the Secretary of State for Defence what safety arrangements are being made following the decision to build a new facility to store radioactive waste at Rosyth naval base.

  Mr. Sainsbury
  The new facility will be designed and constructed to standards set by national legislation on the handling and storage of radioactive materials and will be operated in accordance with nuclear site licence conditions and the requirements of the Nuclear Installations Act 1965.

  Scouts (Membership Records)
  Mr. Cohen
  To ask the Secretary of State for Defence for what purpose his Department keeps records of membership of the Scout movement.

  Mr. Freeman
  I refer the hon. Member to the answer I gave the hon. Member for Blyth Valley (Mr. Campbell) on 12 May 1988, at columns 231–32.

  Nuclear Weapons (Atmospheric Testing)
  Mr. McAllion
  To ask the Secretary of State for Defence if he will outline Her Majesty's Government's policy regarding the atmospheric testing of nuclear weapons.

  Mr. Sainsbury
  The United Kingdom is a signatory and depository Government to the 1963 partial test ban treaty prohibiting nuclear weapon tests in the atmosphere, in outer space and under water.

  Labour Statistics
  Mr. Wray
  To ask the Secretary of State for Employment what information he has on the percentage of adult unemployment in each of the member countries of the European Community, for each year since 1974.

  Mr. Lee
  Following are the available total unemployment rates which allow, as far as possible, for differences in national definitions and coverage, in order to conform to the definitions of unemployment according to guidelines of the International Labour Organisation.

  Corsham Blinker Complex
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Defence, pursuant to his answer to the hon. Member for Ynys Mon of 6 May,Official Report, column 619, why he is unwilling to explain the purpose and functions of his Department's Corsham bunker complex.

  Mr. Ian Stewart
  The information the hon. Member is seeking is classified.

  Low Flying
  Mrs. Margaret Ewing
  To ask the Secretary of State for Defence how many representations were received from Scotland relating to low-flying activity by Tornado aircraft from Royal Air Force, Germany during the Salmond trophy competition on 14 October 1987.

  Mr. Freeman
  [holding answer 21 April 1988]: Nine.

  Mrs. Margaret Ewing
  To ask the Secretary of State for Defence if he will state the numbers and types of aircraft involved and the areas used for low flying by Royal Air Force aircraft participating in the Salmond trophy competition in each year since 1979; and what proportion of the low flying during the Salmond trophy competition in each year was conducted during the period between sunset plus 30 minutes and sunrise minus 30 minutes.

  Mr. Freeman
  [holding answer 21 April 1988]: The exercise referred to as the Salmond trophy is one of the RAF's annual navigational and bombing exercises for RAF Germany squadrons. The exercise has taken place only in 1979, 1986 and 1987. The information requested is as follows:

  529

  Salmond Trophy

  Year and number of aircraft

  Types of aircraft

  Areas used for low flying

  Proportion of low flying during night Per cent.

  1979

  not available

  Harriers, Jaguars, Buccaneers

  Federal Republic of Germany

  No night flying

  1986

  24

  Tornado

  Federal Republic of Germany, United Kingdom and Danish coastal waters

  127

  1987

  24

  Tornado

  Federal Republic of Germany and United Kingdom

  127

  1 All between 7.30 pm and 9.30 pm.

  Mrs. Margaret Ewing
  To ask the Secretary of State for Defence if there are any plans to commence night low-level flying by Hercules aircraft in the Scottish Highlands; and if he will make a statement.

  Mr. Freeman
  [holding answer 21 April 1988]: Hercules aircraft are already permitted to carry out low-level flying at night in the Scottish Highlands.

  Mrs. Margaret Ewing
  To ask the Secretary of State for Defence what aircraft types, and from which air forces, are currently permitted to conduct night low-level terrain following instrument flying in the north-west Scotland tactical training area.

  Mr. Freeman
  [holding answer 21 April 1988]: I assume the hon. Member is referring to the Highlands restricted area, in which low-flying training using terrain-following radar takes place. RAF Tornado and Hercules aircraft and USAF F-111 and USAFE C-130 aircraft are currently permitted to carry out such training, both during the day and at night.

  Dr. Thomas
  To ask the Secretary of State for Defence if he will make a statement on the functions and activities of the military low-flying management group.

  Mr. Freeman
  [holding answer 26 April 1988]: The military low-flying management group is a Ministry of Defence group which, acting within established policy guidelines, is responsible for the day-to-day management and operation of the United Kingdom military low-flying system.

  Dr. Thomas
  To ask the Secretary of State for Defence if he will list the bodies represented on the military low-flying management group.

  Mr. Freeman
  [holding answer 5 May 1988]: No outside bodies are represented on the military low-flying management group.

  Dr. Thomas
  To ask the Secretary of State for Defence what proportion of the land area of England is included within the United Kingdom low-flying system.

  Mr. Freeman
  [holding answer 5 May 1988]: The whole of the land area of England is included within the United Kingdom low-flying system.

  Helicopter Proving Flights
  Mrs. Margaret Ewing
  To ask the Secretary of State for Defence what was the purpose of the proving flights undertaken in the Scottish Highlands in late February by a Gazelle helicopter from Royal Air Force, Shawbury.

  Mr. Freeman
  [holding answer 21 April 1988]: The Gazelle helicopter in question is currently on loan to RAF Odiham and was deployed during late February on low level reconnaissance flights in the Highlands to check for obstacles on flight paths to be used later by Hercules aircraft flying in the dark.

  Army Store, Donnington (Fire)
  Sir John Farr
  To ask the Secretary of State for Defence to what extent the buildings destroyed in the fire in the North Atlantic Treaty Organisation store at Donnington on 25 April were protected by sprinklers.

  Mr. Freeman
  [holding answer 9 May 1988]: Sprinklers were not installed in the building destroyed by fire at COD Donnington on 25 April.

  Sir John Farr
  To ask the Secretary of State for Defence if he will list the recommendations made by the Army board of inquiry after the fire at a 10-acre Army store at Donnington on 24 June 1983 indicating(a) those which were put into effect, (b) those not acted upon and (c) the reason why no action was taken in those cases.

  Mr. Freeman
  [holding answer 9 May 1988]: The board of inquiry recommended that the water supplies for fire fighting at COD Donnington should be enhanced; depot fire orders should be reviewed; the use of polypropylene strapping should be reviewed; constant checks to enforce discipline and ensure compliance with regulations should be applied; hose reels should be installed inside high-rise storage sheds in addition to hand extinguishers; fire advice should be obtained at the initial planning stages for the provision of storage facilities either in new buildings or by new methods in existing buildings; feasibility studies into the provision of compartmentation, sprinkler and detection systems should be carried out before decisions were made about the replacement of building B6; Army fire service personnel should be given guidance and training on fighting fires in high storage buildings; certain measures in respect of the security arrangements at COD Donnington should be taken; in any future similar investigation decisions which may affect the disciplinary process of either military personnel or civilian staff should be taken by the appropriate senior military officer; the storage arrangements for stores which could represent a health hazard should be examined by appropriately trained depot safety officers; and that a record should be made of those who might have encountered a health hazard connected with the fire. All these recommendations were acted upon.

  Equipment Stores (Fire Prevention Review)
  Sir John Farr
  To ask the Secretary of State for Defence what were the main recommendations of the review of fire prevention methods for equipment stores and of storage policy for all three services he announced he had set in hand on 4 July 1983 indicating(a) those recommendations put into effect, (b) those not acted upon and (c) the reason in those cases why no action was taken.
  531
  Mr. Freeman
  [holding answer 9 May 1988]: The 1983 review identified a number of possible ways of reducing the risk of heavy loss by fire in MOD equipment stores, including, where feasible, dispersal of the more valuable stocks and compartmentation of storage buildings. The use of advanced detection and suppression systems was also identified but it was recognised that their value would be limited in buildings stacked intensively with high racking.

  In some cases these and other measures have been adopted as appropriate, having regard to local needs and conditions at individual sites, and in others they are in the course of introduction.

  Sir John Farr
  To ask the Secretary of State for Defence why the recommendations of review of fire prevention methods for equipment stores and of storage policy for all three services he announced he had set in hand on 4 July 1983 recommending sprinkler protection for critical Army stores were not put in hand.

  Mr. Freeman
  [holding answer 9 May 1988]: The tri-service review referred to did not recommend sprinkler protection for critical Army stores. It concluded that the methods of protection of stocks from fire needed to be considered on a site-by-site basis. Each service department reassessed its arrangements for the fire protection of high o value and operationally essential stores on this basis. The Army department formulated, and is putting into effect, plans for the segregation and protection of stocks according to its replacement lead time which include the installation of sprinklers in some buildings.

  Firearms
  Mr. William Ross
  To ask the Secretary of State for Defence (1) on what dates and for what muzzle energy and calibres of firearms his Department granted amended range safety certificates for ranges at(a) Dunmore shooting centre, Abingdon (b) Berkshire Downs Firearms and Ballistics Company, (c) Berkshire Downs rifle and pistol club and (d) Lambourn Valley gun club;

  (2) why the Berkshire Downs rifle and pistol club was issued with a firearms ranges safety certificate on 9 May 1986 by his Department.

  Mr. Freeman
  [holding answer 9 May 1988]: When invited to do so, the MOD will inspect the ranges of civilian shooting clubs which are affiliated to the NRA or NSRA. Range safety certificates when issued certify only that at the time of inspection a range conforms as regards the structural arrangments to the safety rules of MOD ranges of similar character.

  Dunmore shooting centre, Abingdon was issued with a range safety certificate for the firing of weapons with a maximum muzzle energy of 1,313 ft/lbs. I refer the hon. Member to my reply on 20 April, at column 501, for the information concerning the calibre of weapons and date of certificate. I regret the Berkshire Downs Firearms and Ballistics Company was said to have received a range safety certificate in that reply; my Department has not in fact issued a range safety certificate for this organisation.

  A range safety certificate was issued, however, to the Berkshire Downs rifle and pistol club on 9 May 1986. The club was affiliated to the National Rifle Association, which requested an MOD inspection. The certificate was returned when the club closed and was re-issued on 11
  532
  May 1987 when it reopened as the Lambourn Valley gun club. The certificate covered the firing of 0.455in centrefire pistol and rimfire rifle with a maximum muzzle energy of 475 ft/lbs.

  Ammunition Stores (Fire Alarms)
  Mr. Cohen
  To ask the Secretary of State for Defence if he will state the number of buildings that are used by his Department for storage of ammunition or explosives that have no automatic fire alarm; and if he will make a statement.

  Mr. Freeman
  [holding answer 12 May 1988]: It is not our general practice to install automatic fire alarms in explosives storage buildings as these are built and maintained to standards which ensure the lowest possible risk. Automatic fire alarms are not required under explosives regulations or the Health and Safety at Work etc Act 1974. Such buildings are, however, usually served by manual fire alarms to warn employees of any incident.

HOME DEPARTMENT

  Sunday Sport
  Mr. Holt
  To ask the Secretary of State for the Home Department when he last reviewed the effectiveness of the Sunday Observance Act 1780 in relation to spectator sporting events on Sundays.

  Mr. John Patten
  We are not aware of any widespread demand for a review of the effects of the Act on spectator sports in general and have not undertaken one. The issues, however, have received close parliamentary consideration in the context of the Sunday Sports Bills now before the House.

  Mr. Soames
  To ask the Secretary of State for the Home Department what discussions he has had with the racing authorities about the introduction of Sunday racing.

  Mr. John Patten
  Our discussions have been reflected in the measure of general support which we have expressed for the two Sunday Sports Bills which are at present before the House. It does not seem to us unreasonable for the racing authorities to want to hold races on Sundays and to make provision to avoid illegal betting. Equally., we have made clear our respect for the position of those who wish to retain the traditional pattern of Sundays.

  Mr. Key
  To ask the Secretary of State for the Home Department what information he has about the number of convictions which have been brought under the Sunday Observance Act 1780 in the last five years in respect of spectator sporting events on Sundays.

  Mr. John Patten
  The information available to me, which may be incomplete, shows no prosecutions relating to sporting events under the Sunday Observance Act 1780 for the years 1982 to 1986.

  Immigration
  Dr. Reid
  To ask the Secretary of State for the Home Department if he will now recruit more staff at Lunar house to cope with immigration cases; and if he will make a statement.
  533
  Mr. Boateng
  To ask the Secretary of State for the Home Department if he will now recruit more staff at Lunar house to cope with the present immigration work load; and if he will make a statement.

  Mr. Renton
  Vigorous steps are being taken to recruit some 100 additional staff for the immigration and nationality department at Lunar house during the current financial year. In addition, we are planning to recruit more than 100 further staff outside London to deal with the influx of citizenship applications.

  Mr. Holland
  To ask the Secretary of State for the Home Department how many of the total number of passengers granted temporary admission in(a) 1986 and (b) 1987 subsequently absconded.

  Mr. Renton
  In all, 1,161 passengers absconded in 1986 and 821 in 1987. Separate figures are not available, but the great majority would have been on temporary admission.

  Mr. Holland
  To ask the Secretary of State for the Home Department (1) how many people were detained overnight during 1987 in(a) Harmondsworth detention centre, (b) Queen's building, Heathrow and (c) the Beehive, Gatwick;

  (2) what was the total number of passengers detained overnight under Immigration Act powers during 1987, by nationality.

  Mr. Renton
  The tables give the numbers of passengers whose detention spanned at least one night pending a decision on their admission to or their removal from the United Kingdom.

  Passengers1 detained overnight in certain locations, 1987

  Location

  Number

  Harmondsworth

  4,370

  Queen's building

  21,907

  Gatwick (virtually all at the Beehive)

  1,825

  1 Excluding illegal entrants and deportees.

  2 Provisional.

  Passengers detained overnight by nationality 19871

  Number2

  Non-EC Foreign Nationals

  Algeria

  613

  Arab Republic of Egypt

  33

  Argentina

  4

  Austria

  13

  Brazil

  105

  Bulgaria

  2

  Chile

  32

  China

  11

  Colombia

  169

  Cuba

  3

  Czechoslovakia

  9

  Ethiopia

  67

  Finland

  7

  GDR

  4

  Hungary

  5

  Indonesia

  3

  Iran

  480

  Iraq

  198

  Israel

  66

  Japan

  71

  Jordon

  24

  Kuwait

  4

  Lebanon

  119

  Libya

  25

  Mexico

  31

  Morocco

  337

  534

  Number2

  Norway

  28

  Pakistan

  557

  Peru

  17

  Philippines

  84

  Poland

  10

  Romania

  1

  Saudi Arabia

  14

  Somalia

  57

  South Africa

  56

  Sudan

  59

  Sweden

  22

  Switzerland

  15

  Syria

  27

  Thailand

  58

  Tunisia

  121

  Turkey

  1,008

  USA

  271

  USSR

  9

  Uruguay

  4

  Venezuela

  19

  Yugoslavia

  110

  Other Foreign Countries

  393

  Stateless

  235

  Total Non-EC Foreign

  5,610

  EC Nationals

  Belgium

  3

  Denmark

  3

  France

  23

  Germany

  8

  Greece

  7

  Italy

  18

  Luxembourg

  —

  Netherlands

  5

  Portugal

  200

  Spain

  131

  Total EC

  398

  Commonwealth Citizens

  Australia

  45

  Bangladesh

  439

  Barbados

  1

  Canada

  36

  Cyprus

  71

  Ghana

  651

  Guyana

  17

  Hong Kong BDTC

  146

  India

  476

  Jamaica

  202

  Kenya

  44

  Malaysia

  176

  Malta

  14

  Mauritius

  56

  New Zealand

  23

  Nigeria

  705

  Sierra Leone

  88

  Singapore

  38

  Sri Lanka

  718

  Tanzania

  58

  Trinidad & Tobago

  18

  Uganda

  262

  Zambia

  20

  Zimbabwe

  32

  BOC

  41

  Other Commonwealth countries

  149

  Total Commonwealth

  4,526

  All Nationalities

  10,534

  1 Excluding illegal entrants and deportees.

  2 Provisional. The figures include a small element of double counting when a passenger is detained at more than one location.

  535
  Mr. Holland
  To ask the Secretary of State for the Home Department how many of the total number of persons treated as illegal entrants in 1987, who were granted temporary admission, subsequently absconded.

  Mr. Renton
  A total of 924 illegal entrants were granted temporary release, in 1987 pending completion of their cases. Of these, 50 failed to comply with the terms attached and were subsequently recorded as absconders.

  Mr. Holland
  To ask the Secretary of State for the Home Department how many people detained under Immigration Act powers applied to the Home Office to be allowed to depart voluntarily under the supervised departure provisions of paragraph 156 of the immigration rules during 1987.

  Mr. Renton
  I regret that the information in the form requested could be provided only at disproportionate cost. However, in 1987 63 persons used the supervised departure provision in paragraph 156 of the immigration rules.

  Mr. Holland
  To ask the Secretary of State for the Home Department how many persons were recommended for deportation with no custodial sentence during 1987; and in how many such cases the courts directed release(a) subject to conditions, and (b) without conditions.

  Mr. Renton
  During 1987 a total of 352 persons were recommended for deportation by the courts with no custodial sentence. The courts directed release subject to restrictions in 52 cases and without restrictions in 135 cases.

  Mr. Holland
  To ask the Secretary of State for the Home Department how many people were received into Prison Department establishments under Immigration Act powers during 1987, by individual prison establishment.

  Mr. Douglas Hogg
  Information for 1987 is not yet available. The latest information is given in the table.

  Receptions of persons detained under the Immigration Act 1971 into Prison Department establishments in England and Wales in 1986

  Establishment

  Number1

  Remand centres

  Ashford

  144

  Brockhill

  1

  Exeter

  1

  Latchmere House

  863

  Low Newton

  1

  Norwich

  1

  Risley

  9

  Prisons

  Bedford

  4

  Birmingham

  46

  Bristol

  25

  Brixton

  1

  Canterbury

  34

  Cardiff

  7

  Durham

  7

  Exeter

  4

  Gloucester

  2

  Holloway

  11

  Hull

  3

  Leeds

  7

  Leicester

  5

  Lewes

  3

  Lincoln

  2

  Norwich

  1

  Pentonville

  21

  Shrewsbury

  1

  Winchester

  4

  536

  Establishment

  Number1

  Wormwood Scrubs

  3

  Others

  Blantyre House

  95

  Bullwood Hall

  1

  Erlestoke

  115

  All Prison Department establishments

  1,422

  1 The figures are those recorded centrally and are approximate, detailed checking of individual cases would involve disproportionate cost.

  Mr. Holland
  To ask the Secretary of State for the Home Department what was the average length of time spent in Prison Department establishments for persons detained under Immigration Act powers during 1987.

  Mr. Douglas Hogg
  Information for 1987 is not yet available. The average period of detention in Prison Department establishments in England and Wales of persons initially received under the Immigration Act 1971 powers who were discharged in 1986 was about four weeks.

  Mr. Holland
  To ask the Secretary of State for the Home Department what was the average daily population of persons detained in Prison Department establishments under Immigration Act powers during 1987.

  Mr. Douglas Hogg
  In 1987 the average population of persons detained under the Immigration Act 1971 in Prison Department establishments in England and Wales was 167.

  Mr. Holland
  To ask the Secretary of State for the Home Department how many persons were detained under Immigration Act powers for a period of more than two months on completion of a custodial sentence during 1987.

  Mr. Renton
  Forty-one, excluding deportation cases who served a custodial sentence of seven days or less, about whom information is not readily available.

  Mr. Corbyn
  To ask the Secretary of State for the Home Department if he will give, for each year since 1979, the number of children removed from the country, under the terms of the Immigration Acts; and how many of these had representations made on their behalf by right hon. and hon. Members.

  Mr. Renton
  Comprehensive information is not readily available and could be provided only at disproportionate cost.

  Mr. Corbyn
  To ask the Secretary of State for the Home Department (1) if he will give, for each year since 1979, the number of stops requested by hon. Members under the Immigration Act which were refused;

  (2) if he will give, for each year since 1979, the number of people represented by hon. Members who were refused entry and subsequently made voluntary departures, under the terms of the Immigration Act;

  (3) how many persons, for each year since 1979, who were deported under the current immigration laws had representations made on their behalf by right hon. and hon. Members.

  Mr. Renton
  I regret that the information requested is not readily available and could be provided only at disproportionate cost.
  537
  Mr. Corbyn
  To ask the Secretary of State for the Home Department how many persons of Turkish or Kurdish origin were detained between 21 March and 5 May at Harmondsworth detention centre.

  Mr. Renton
  A total of 161 Turkish nationals were detained at Harmondsworth between the dates given. Records do not distinguish ethnic origin.

  Mr. Corbyn
  To ask the Secretary of State for the Home Department how many children were detained at(a) Harmondsworth and (b) other detention centres, over the past year.

  Mr. Renton
  During the 12 months ended 30 April 1988 the numbers of persons under the age of 18 detained in the main immigration service detention centres were as follows:

  Number

  Harmondsworth

  222

  The Beehive, Gatwick

  163

  Queen's Building, Heathrow

  43

  Note: Some people may have been detained in more than one location.

  Mr. Corbyn
  To ask the Secretary of State for the Home Department how many immigration officers and other persons for whom his Department is responsible escorted the 19 people alleged to be of Kurdish or Turkish origin back to Turkey on 5 May.

  Mr. Renton
  Twenty-five officers of the Metropolitan police escorted the group. They were also accompanied by two members of the immigration service, an interpreter engaged for the occasion and a doctor engaged by the airline.

  Sunday Trading
  Mr. Stern
  To ask the Secretary of State for the Home Department when he now expects to bring forward plans for the deregulation of Sunday trading.

  Mr. Renton
  As is well known, the Government continue to favour complete deregulation of Sunday trading hours. They are, nevertheless, prepared to consider any practicable compromise short of this if and when a consensus can be achieved.

  Summer Time
  Mr. Teddy Taylor
  To ask the Secretary of State for the Home Department what progress has been made in discussing summer time arrangements in the European Economic Community since the debate on 28 April; and if he will make a statement.

  Mr. Douglas Hogg
  Discussions with other member states of the European Community are not expected to take place until later in the summer, when a proposal for a directive on summer time arrangements for 1990 onwards will be tabled by the European Commission.

  Nationality Applications
  Mr. Madden
  To ask the Secretary of State for the Home Department what representations he has received about the arrangements for processing British citizenship applications.
  538
  Mr. Renton
  I have received a number of representations about the time taken to acknowledge applications for registration submitted before 31 December 1987, and about the time taken to consider citizenship applications generally. These delays are very much regretted, but we are dealing with this formidable task in the manner I described earlier today to my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) and the hon. Member for Wolverhampton South-East (Mr. Turner).

  Ms. Primarolo
  To ask the Secretary of State for the Home Department what plans he has to deal with the backlog of applications for British citizenship.

  Mr. Jim Marshall
  To ask the Secretary of State for the Home Department if he will make a statement on the number of applications for British nationality still being processed by Lunar house.

  Mr. Renton
  I refer the hon. Members to the reply I gave earlier to the questions from my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) and the hon. Member for Wolverhampton, South-East (Mr. Turner).

  Mr. Nellist
  To ask the Secretary of State for the Home Department when he now expects to acknowledge the applications made before 31 December 1987 for registration as a British citizen; and if he will make a statement.

  Mr. Renton
  All such applications have now been acknowledged.

  IBA (Chairman)
  Mr. Grocott
  To ask the Secretary of State for the Home Department whether he has any plans to meet the chairman of the Independent Broadcasting Authority to discuss future arrangements for television franchises.

  Mr. Hurd
  I meet the chairman of the IBA from time to time to discuss a wide range of broadcasting issues.

  Mr. Barron
  To ask the Secretary of State for the Home Department whether he has yet reached a decision on the reappointment of the present chairman of the Independent Broadcasting Authority.

  Mr. Cohen
  To ask the Secretary of State for the Home Department if it is his intention to reappoint the present chairman of the Independent Broadcasting Authority.

  Mr. Hinchliffe
  To ask the Secretary of State for the Home Department if it is his intention to reappoint the present chairman of the Independent Broadcasting Authority.

  Mr. Renton
  I refer the hon. Member to the reply I gave to a question from the hon. Member for Leeds, West (Mr. Battle) on 16 May, at column 310.

  Drug Abuse
  Mr. Burns
  To ask the Secretary of State for the Home Department what recent assessment he has made of the efficacy of Government measures to combat the abuse of drugs.

  Mr. Douglas Hogg
  The ministerial group on the misuse of drugs co-ordinates and monitors the Government's
  539
  strategy against drug misuse. When the group last met on 4 May it took note of, amongst other things, the generally encouraging findings of an independent evaluation of the 1987–88 prevention campaign. As chairman of the group, I have made a number of visits to see how different aspects of the strategy are implemented. Most recently I visited the Metropolitan police central and No. 2 area drugs squads and St. Mary's hospital, Paddington drug dependency unit. I was impressed by all the excellent work being done.

  Mr. Chapman
  To ask the Secretary of State for the Home Department if he will make a further statement on his initiatives to tackle drugs misuse and abuse.

  Mr. Douglas Hogg
  I refer my hon. Friend to the replies I gave to questions from my hon. Friend the Member for Derbyshire, West (Mr. McLoughlin) on 21 April 1988, at column 517, and from the hon. Member for Don Valley (Mr. Redmond) on 3 May 1988, at column 428.

  Criminal Cases (Right to Silence)
  Mr. Illsley
  To ask the Secretary of State for the Home Department if he has any plans to seek to alter the present right to silence of suspects and defendants in criminal cases.

  Mr. John Patten
  I refer the hon. Member to the reply given to my hon. Friend the Member for Lancashire, West (Mr. Hind) yesterday.

  Prisoners (Police Cells)
  Mr. Cash
  To ask the Secretary of State for the Home Department what has been the recent trend in the number of prisoners held in police cells.

  Mr. Douglas Hogg
  The numbers in police cells rose to a peak of 1,575 in early March. Since then, both the temporary camps which my right hon. Friend announced on 30 March have been brought into operation; and the numbers had fallen to 905 yesterday.

  Young People (Custody)
  Mr. Baldry
  To ask the Secretary of State for the Home Department if he will make a further statement on recent initiatives aimed at providing alternatives for custody for young people.

  Mr. John Patten
  Our thinking on alternatives to custody for young people will be reflected in the proposals on punishment in the community for offenders over 17 which we are continuing to develop and will publish later this year.

  Drug Traffickers
  Mr. Andrew MacKay
  To ask the Secretary of State for the Home Department what information he has about the implementation of measures to confiscate the assets of convicted drug traffickers.

  Mr. Douglas Hogg
  During the first year of operation of the Drug Trafficking Offences Act 1986 the High Court made over 150 restraint or charging orders freezing some £7 million of suspected drug traffickers' assets; and some substantial sums have been confiscated by the Crown court, including £452,000 in one case in January 1988. The national drugs intelligence unit now co-ordinates all 540
  intelligence about the financial activity of suspected drug traffickers. We recently signed an agreement with the United States for co-operation in the tracing, freezing and confiscation of the proceeds of drug trafficking, and we expect to conclude further such agreements this year.

  Myra Hindley
  Mr. Dickens
  To ask the Secretary of State for the Home Department if he will give permission for hypnosis to be used on Myra Hindley to assist the Great Manchester police in their search for the grave of Keith Bennett.

  Mr. Douglas Hogg
  We are not persuaded that hypnosis of Myra Hindley is likely to produce information which would be of material assistance in the search for the grave of Keith Bennett.

  Police (Establishment)
  Mr. Martlew
  To ask the Secretary of State for the Home Department if he will list the outstanding applications for increases in establishment that he has received from police authorities in England and Wales.

  Mr. Morgan
  To ask the Secretary of State for the Home Department if he will list the police authorities in England and Wales which have recently applied to him for an increase in establishment, showing how many of these applications are still outstanding.

  Mr. Douglas Hogg
  The information requested is as follows:

  1988–89

  Police Authority

  Number of posts applied for

  Number of posts approved with effect from 1 June 1988

  Avon and Somerset

  45

  20

  Bedfordshire

  31

  10

  Cambridgeshire

  60

  20

  Cheshire

  25

  15

  Cumbria

  40

  —

  Devon and Cornwall

  96

  25

  Dorset

  40

  —

  Durham

  16

  —

  Essex

  180

  120

  Greater Manchester

  140

  —

  Gwent

  42

  9

  Hampshire

  70

  23

  Hertfordshire

  35

  —

  Humberside

  37

  —

  Kent

  59

  30

  Leicestershire

  45

  —

  Merseyside

  35

  —

  Norfolk

  50

  20

  Northamptonshire

  38

  20

  Northumbria

  80

  30

  North Wales

  41

  10

  North Yorkshire

  25

  —

  Nottinghamshire

  63

  35

  South Wales

  66

  —

  South Yorkshire

  50

  20

  Staffordshire

  50

  10

  Suffolk

  1

  —

  Surrey

  6

  —

  Sussex

  7

  —

  Thames Valley

  200

  290

  Warwickshire

  14

  —

  West Midlands

  350

  70

  West Yorkshire

  260

  23

  Wiltshire

  20

  —

  Total

  2,217

  500

  541
  1 Excluding posts for Stansted airport.

  2 Includes 50 already announced with effect from 1 April 1988.

  Mr. Cran
  To ask the Secretary of State for the Home Department if he will give urgent consideration to approving the request for a variation in the authorised establishment of Humberside police force.

  Mr. Douglas Hogg
  Mr right hon. Friend was unable to give the Humberside police authority's application for 41 additional police posts priority over other applications in the allocation of the 450 additional posts available for 1988–89. The police authority has been informed that its application will be reconsidered when my right hon. Friend next takes decisions on the allocation of police manpower.

  Mr. Colvin
  To ask the Secretary of State for the Home Department what representations he has received about an increase in the police establishment of the Hampshire and Isle of Wight constabulary.

  Mr. Douglas Hogg
  We have received representations from the Police Authority and from hon. Members whose constituencies lie within the force area. The police authority applied for 23 police posts in 1987–88. This bid has been met in full with effect from 1 June 1988. A further application for 47 posts has recently been received and this will be considered together with applications received from other police authorities when my right hon. Friend next takes decisions on the allocation of police manpower.

  Birmingham Pub Bombings
  Mr. Mullin
  To ask the Secretary of State for the Home Department what progress has been made by the Commissioner of the City of London police in the inquiry into alleged contacts between Dr. Frank Skuse and former Superintendent George Reade while they were both witnesses at the appeal hearing of the men convicted of the Birmingham pub bombings.

  Mr. John Patten
  I understand from the Commissioner of Police for the City of London that a report has been sent to the Director of Public Prosecutions, at whose request the inquiries were made.

  Identity Cards
  Sir John Biggs-Davison
  To ask the Secretary of State for the Home Department what discussions he has had with his counterparts of the Trevi Group and other countries about their experience of the universal issue of identity cards; and if he will make a statement.

  Mr. Douglas Hogg
  The issue of identity cards has not been discussed with Ministers of other countries either within the Trevi Group or otherwise.

  Police (Leicestershire)
  Mr. Vaz
  To ask the Secretary of State for the Home Department if he has received any recent representations concerning the request by the chief constable of Leicestershire for more police officers; and if he will make a statement.

  Mr. Douglas Hogg
  Yes. My right hon. Friend has carefully considered the Leicestershire police authority's application for additional manpower but was unable to allocate for the authority any of the 450 posts available for 542
  1988–89. The police authority has been informed that its application will be considered again, together with others, when my right hon. Friend next takes decisions on the allocation of police manpower.

  Broadcasting Standards Council
  Mr. Patchett
  To ask the Secretary of State for the Home Department if he has yet decided on the terms of reference for the new Broadcasting Standards Council.

  Mr. Tony Lloyd
  To ask the Secretary of State for the Home Department if he will make a statement on the proposed terms of reference for the new Broadcasting Standards Council.

  Mr. Renton
  I would refer the hon. Members to my right hon. Friend's statement to the House on 16 May, at columns 685–86.

  Mr. Tony Banks
  To ask the Secretary of State for the Home Department what will be the salary of Sir William Rees-Mogg as the chairman designate of the Broadcasting Standards Council; and what hours he will be expected to work.

  Mr. Renton
  Sir William's salary as chairman will be £30,000 a year on the basis of a three-day week, but a current review of this and other broadcasting appointments may lead to an increase.

  Mr. Tony Banks
  To ask the Secretary of State for the Home Department how many members are likely to be appointed to the Broadcasting Standards Council; what will be the period of appointment; and when the next appointment announcements will be made.

  Mr. Renton
  My right hon. Friend will announce the names and periods of appointment of the members of the Broadcasting Standards Council as soon as possible.

  Mr. Tony Banks
  To ask the Secretary of State for the Home Department what qualities will be taken into consideration when making appointments to the proposed Broadcasting Standards Council; and if he will make a statement.

  Mr. Renton
  We shall be seeking candidates whose personal qualities and experience will enable them to contribute to the successful establishment and operation of the council.

  Mr. Tony Banks
  To ask the Secretary of State for the Home Department what is the anticipated annual cost in the first five years of the Broadcasting Standards Council.

  Mr. Renton
  We envisage that the Broadcasting Standards Council may require a budget of around £1 million a year, but this financial provision will be reviewed in the light of experience as the work of the council develops.

  Mr. Alfred Morris
  To ask the Secretary of State for the Home Department, pursuant to his oral answer to the hon. Member for Manchester, Wythenshawe of 16 May,Official Report, column 688, what steps he has taken, or will be taking, to ensure that the proposed Broadcasting Standards Council will not conflict with the existing role of the British Broadcasting Corporation's governors and that of the members of the Independent Broadcasting Authority; and if he will make a statement.

  Mr. Renton
  The role of the governors of the BBC, as defined in the corporation's royal charter, licence and
  543
  agreement, and the role of the members of the IBA, as defined in the Broadcasting Act 1981, are quite distinct from the functions of the Broadcasting Standards Council as announced on 16 May. The broadcasting authorities will continue to have responsibility for programme standards and will be expected to exercise judgment in these matters.

  Police Forensic Science Department
  Mr. Murphy
  To ask the Secretary of State for the Home Department if he has any plans to privatise the police forensic science department.

  Mr. Hoyle
  To ask the Secretary of State for the Home Department if he has any plans to privatise the present police forensic science department.

  Mr. Douglas Hogg
  We have no present plans to do so.

  Official Secrets Act
  Mrs. Mahon
  To ask the Secretary of State for the Home Department when he now expects to make a statement on his proposals for the reform of section 2 of the Official Secrets Act.

  Mr. John Patten
  I refer the hon. Member to the reply given earlier to the question from the hon. Member for Sheffield, Central (Mr. Caborn).

  Ms. Quin
  To ask the Secretary of State for the Home Department if he will now make a statement on his proposals for the reform of the Official Secrets Acts.

  Mr. John Patten
  My right hon. Friend hopes to lay before Parliament next month a White Paper setting out the Government's proposals for the reform of section 2 of the Official Secrets Act 1911.

  Charity Law
  Mr. Kirkwood
  To ask the Secretary of State for the Home Department what representations he has received seeking reform of the charities laws.

  Mr. John Patten
  We have received a number of representations seeking reform of charity law along the lines recommended by the Woodfield report. We have also received representations for a change in the law on charitable status.

  Prison Building
  Mr. Devlin
  To ask the Secretary of State for the Home Department what plans his Department has to build prisons in the northern region.

  Mr. Douglas Hogg
  Following last year's public expenditure survey, the prison building programme contained 26 new prisons. Seven are planned for the Prison Department's northern region: four in Lancashire (Garth, Lancaster Farms, Rochdale and Buckley Hall), two in Yorkshire (Lindholme II and Doncaster) and, one in Cheshire (Thorn Cross). One in Humberside (Full Sutton) was officially opened last month. In addition, there are four prisons in the programme for which sites have not yet been chosen. One of these may be allocated to the northern region for a local prison in the north-east.

  Credit Betting
  Mr. Andrew Mitchell
  To ask the Secretary of State for the Home Department what information he has as to the volume of credit betting which takes place on Sundays.

  Mr. John Patten
  None.

  Horserace Totalisator Board
  Mr. William Powell
  To ask the Secretary of State for the Home Department when he last met the chairman of the Horserace Totalisator Board; and what matters were discussed.

  Mr. John Patten
  The last formal occasion on which my right hon. Friend met the chairman was on 8 March at the tote annual luncheon. They discussed matters of interest to the board and the Sunday Sports Bill, which the chairman had guided through another place.

  Race Relations
  Mr. Marlow
  To ask the Secretary of State for the Home Department what is the annual cost to his Department of race relations policies, including the Commission for Racial Equality.

  Mr. John Patten
  Lead responsibility for race relations policy rests within the Home Office with the equal opportunities and general department. In 1987–88 the total cost, including staff costs, allocated out of Home Office expenditure to these policies was £11·6 million. Of this, £10·8 million was paid in grant in aid to the Commission for Racial Equality.

  Terrorism
  Mr. Michael McNair-Wilson
  To ask the Secretary of State for the Home Department when he last met his European counterparts to discuss anti-terrorist measures.

  Mr. Hurd
  I attended a meeting of Trevi Ministers in Copenhagen on 9 December 1987 under the Danish presidency. I shall be attending the ministerial meeting under the German presidency in Munich on 3 June. I have also had bilateral talks with my French and Portuguese counterparts in London this year.

  Prison Officers' Association
  Sir John Farr
  To ask the Secretary of State for the Home Department when he last met members of the Prison Officers' Association; and what matters were discussed.

  Mr. Douglas Hogg
  My right hon. Friend last met members of the Prison Officers' Association on 30 March. They discussed overcrowding, the staffing of establishments and the involvement of the private sector in all aspects of the remand system.

  European Broadcasting
  Mr. Dykes
  To ask the Secretary of State for the Home Department when he next expects to discuss European broadcasting problems with his counterparts in the member states of the European Economic Community and the Council of Europe.

  Mr. Tim Renton
  The next meeting of Council of Europe Broadcasting Ministers is due to take place in Stockholm on 23–24 November to discuss European
  545
  broadcasting policy in an international context. There are no formal arrangements for meetings of Broadcasting Ministers in the framework of the European Community, but further discussion of the draft EC directive on broadcasting will no doubt take place in the Council in due course.

  Traffic (London)
  Mr. Adley
  To ask the Secretary of State for the Home Department what discussions he intends to hold with the Metropolitan police to discuss traffic organisation in London; and if he will make a statement.

  Mr. Douglas Hogg
  My right hon. Friend meets the Commissioner of Police of the Metropolis from time to time to discuss a range of policing issues, although there are at present no plans to meet specifically in order to discuss traffic organisation in London. Officials in the Department have regular contacts with Metropolitan police staff on traffic issues.

  Exeter Prison
  Mr. Speller
  To ask the Secretary of State for the Home Department when he expects that Exeter prison, will hold no more than the number of prisoners it was originally built to hold; and how many prisoners on remand awaiting trial are currently held there.

  Mr. Douglas Hogg
  On 13 May 126 unconvicted prisoners were held in Exeter prison, of whom 68 were awaiting trial in the Crown court. Since the numbers likely to be committed to prison by the courts in the future cannot be predicted with any certainty, the length of time for which overcrowding will continue in a particular prison cannot be forecast. My right hon. Friend announced on 30 March a number of measures aimed at substantially increasing the capacity of the prison system as a whole over the next few years, and thus directly tackling the overcrowding problem.

  Lunar House (Mail)
  Ms. Short
  To ask the Secretary of State for the Home Department what action is being taken to clear the backlog of mail at Lunar house.

  Mr. Renton
  I refer the hon. Member to the reply given earlier to my hon. Friend the Member for Richmond and Barnes (Mr. Hanley).

  Turkish Students
  Mr. Atkinson
  To ask the Secretary of State for the Home Department if he has received any representations from the English language school industry concerning the treatment of Turkish students by immigration officials on arrival in the United Kingdom to attend courses.

  Mr. Renton
  Yes. They have been replied to.

  Cheshire Police
  Mr. Butler
  To ask the Secretary of State for the Home Department if he will authorise a rise in the police establishment in Cheshire.

  Mr. Douglas Hogg
  As my right hon. Friend announced yesterday in reply to a question from my hon. Friend the 546
  Member for Crawley (Mr. Soames), at columns 466–67, he has approved 15 posts for the Cheshire constabulary with effect from 1 June 1988.

  Boundary Commission (General Review)
  Mr. Hayward
  To ask the Secretary of State for the Home Department, pursuant to the answer of 7 July 1987,Official Report, column 96, to the hon. Member for Hazel Grove (Mr. Arnold) what information he has as to whether the Boundary Commission still expects the general review to commence in 1990; and how far in advance of the statutory deadline the commission is aiming to report on the outcome of this review.

  Mr. Douglas Hogg
  Within the limits prescribed by the Parliamentary Constituencies Act 1986, the timing of each commission's work is a matter for it to determine. I understand, however, that the Boundary Commission for England hopes to submit a report fairly early in the 1993–98 period allowed by the Act, and that the start of their review is likely to be announced early in 1991.

  Channel Ferries, Dover
  Mr. Austin Mitchell
  To ask the Secretary of State for the Home Department if he will call for a report from the chief constable of Kent as to what steps the police have taken at Dover to clear a road to the Channel ferries for vehicles wishing to load.

  Mr. Douglas Hogg
  I understand from the chief constable of Kent that access to Dover docks on the public highway has remained clear throughout the current dispute. The policing of Dover harbour board property and movement from there to the ferries is a matter for the board.

  Prisoners
  Mrs. Ann Taylor
  To ask the Secretary of State for the Home Department what is the total period of time that a prisoner sentenced to one year's imprisonment who had(a) been held on remand for six months, and (b) been held on remand for one month, would spend in custody, having lost entitlement to three months remission.

  Mr. Douglas Hogg
  (a) nine months, of which three months would be served after sentence.

  (b) nine months, of which eight months would be served after sentence.

  Mrs. Ann Taylor
  To ask the Secretary of State for the Home Department what account is taken of periods for which prisoners have been held on remand in calculating loss of remission under rule 54 of the prison rules.

  Mr. Douglas Hogg
  Any remission forfeited prospectively under prison rule 54 during a period on remand may be deducted from the total amount of remission which, otherwise, would be earned in respect of that period.

  Mrs. Ann Taylor
  To ask the Secretary of State for the Home Department what is his estimate of the number of prisoners presently serving sentences whose total period of custody after loss of remission will be longer because periods during which they were held on remand have been disregarded in calculating loss of remission than it would have been if such periods had been taken into account in the implementation of rule 54 of the prison rules.
  547
  Mr. Douglas Hogg
  Of those presently serving sentences, none.

  Mrs. Ann Taylor
  To ask the Secretary of State for the Home Department what guidance is issued by his Department on the account to be taken of periods spent on remand in interpreting rule 54 of the prison rules; if he will place a copy of such guidance in the Library; and if he will make a statement.

  Mr. Douglas Hogg
  Guidance is contained in prison standing order 3C 6(5) as amended by circular instruction 23/1988 (standing order amendment 427); copies of these documents are in the Library.

  Asylum
  Mr. Holland
  To ask the Secretary of State for the Home Department (1) if he will provide a breakdown by nationality of the number of passengers seeking political asylum who were detained under Immigration Act powers in 1987 in(a) Prison Department establishments and (b) immigration detention accommodation;

  (2) how many of the total number of passengers seeking political asylum were granted temporary admission during (a) 1986 and (b)

  Mr. Renton
  The information requested is not readily available and could be obtained only at disproportionate cost.

  Professor Vera Ivanovna Rasdolskaya
  Mr. Arbuthnot
  To ask the Secretary of State for the Home Department when he will be giving a substantive reply to the letter of 15 February from the hon. Member for Wanstead and Woodford drawing his attention to the visa application made on 7 November 1987 by Mrs. Bernard for her cousin, Professor Vera Ivanovna Rasdolskaya, to pay a family visit to the United Kingdom during August.

  Mr. Renton
  I replied to the hon. Member yesterday.

  Passports (Mr. and Mrs. Read)
  Mr. Teddy Taylor
  To ask the Secretary of State for the Home Department if he will make inquiries into the reason why Mr. Ronald Read and Mrs. Doris Patricia Read of 6 Montgomery Court, North Shoebury, Southend on Sea, who applied to Peterborough for passports on 17 March explaining that they were required by 9 May, have not received them; and if he will make a statement.

  Mr. Renton
  A letter requesting £7·50 balance of fee failed to reach Mr. and Mrs. Read, who moved house on 12 May. The Peterborough passport office has since made contact with them by telephone and their passport will be issued immediately on receipt of the balance of fee, in time for their holiday in early June. Regrettably, the application was not given any priority when it was received on 25 March.

  Magistrates Courts
  Mr. Bermingham
  To ask the Secretary of State for the Home Department if he will list the number of vacancies at the latest available date for(a) justices clerks and (b) other staff in magistrates courts in the area of each magistrates court committee.
  548
  Mr. John Patten
  There are no vacancies for justices' clerks. The latest date for which information is available for other staff is 1 April 1987, the information drawn from a survey conducted by the joint negotiating committee for magistrates courts staff. This information is set out in the table. The information for staff vacancies as at 1 April 1988 is not yet available.

  Magistrates' Courts staff vacancies11 April 1987

  Magistrates' Courts Committee

  Vacancies

  Avon

  0

  Bedfordshire

  6

  Berkshire

  n/a

  Buckinghamshire

  1

  Cambridgeshire

  0

  Cheshire

  0

  Cleveland

  3

  Cornwall

  0

  Cumbria

  1

  Derbyshire

  4

  Devon

  n/a

  Dorset

  0

  Durham

  0

  East Sussex

  3

  Essex

  n/a

  Gloucestershire

  n/a

  Hampshire

  15

  Hereford/Worcester

  0

  Hertfordshire

  n/a

  Humberside

  4

  Isle of Wight

  1

  Kent

  9

  Lancashire

  0

  Leicestershire

  6

  Lincolnshire

  0

  Norfolk

  n/a

  Northamptonshire

  n/a

  Northumberland

  1

  North Yorkshire

  1

  Nottinghamshire

  n/a

  Oxfordshire

  n/a

  Shropshire

  1

  Somerset

  0

  Staffordshire

  3

  Suffolk

  0

  Surrey

  2

  Warwickshire

  0

  West Sussex

  0

  Wiltshire

  4

  Clwyd

  0

  Dyfed

  2

  Gwent

  n/a

  Gwynedd

  0

  Mid Glamorgan

  0

  Powys

  0

  South Glamorgan

  0

  West Glamorgan

  n/a

  Barnsley

  1

  Birmingham

  5

  Bolton

  0

  Bradford

  0

  Bury

  0

  Calderdale

  2

  Coventry

  0

  Doncaster

  2

  Dudley

  0

  Gateshead

  0

  Kirklees/Huddersfield

  0

  Knowlsey

  0

  Leeds

  1

  Liverpool

  8

  Manchester

  1

  Newcastle

  n/a

  North Tyneside

  3

  Oldham

  0

  549

  Magistrates' Courts Committee

  Vacancies

  Rotherham

  n/a

  Rochdale

  2

  St. Helens

  1

  Salford

  2

  Sandwell

  0

  Sefton

  2

  Sheffield

  1

  Solihull

  0

  South Tyneside

  4

  Stockport

  1

  Sunderland

  3

  Tameside

  1

  Trafford

  0

  Wakefield

  0

  Walsall

  0

  Wigan

  1

  Wirral

  0

  Wolverhampton

  0

  Barking/Dagenham

  0

  Barnet

  1

  Bexley

  1

  Brent

  n/a

  Bromley

  3

  Croydon

  0

  Ealing

  n/a

  Enfield

  0

  Haringey

  0

  Harrow

  1

  Havering

  0

  Hillingdon

  0

  Hounslow

  1

  Kingston

  n/a

  Merton

  1

  Newham

  n/a

  Redbridge

  1

  Richmond

  5

  Sutton

  0

  Waltham Forest

  7

  Uxbridge

  0

  Inner London

  34

  City of London

  n/a

  1 Excluding justices' clerks.

  n/a = Not available.

  Press Standards Council
  Mr. Tony Banks
  To ask the Secretary of State for the Home Department if he will make it his policy to set up a Press Standards Council; and if he will make a statement.

  Mr. Renton
  The Government have no plans to set up a council to oversee press standards. There is already in place a system of self-regulation under the auspices of the Press Council.

  Essex Constabulary
  Dr. Michael Clark
  To ask the Secretary of State for the Home Department what representations he has received regarding the strength of the Essex constabulary; and if he will make a statement.

  Mr. Douglas Hogg
  My right hon. Friend has just approved 20 additional posts for Essex police. This brings to 90 the number of posts we have been able to approve so far in response to its application for 150 posts over the three years 1986–87 to 1988–89. The total number of posts approved since May 1979 is now 237. The remaining posts will be considered when my right hon. Friend next takes decisions on the allocation of police manpower.

SOCIAL SERVICES

  Hospital Closures (Shropshire)
  Mr. Biffen
  To ask the Secretary of State for Social Services how many representations he has received to date concerning the proposed hospital closure programme of the Shropshire health authority; and how many favour the proposals of the authority.

  Mrs. Currie
  Since my reply to my right hon. Friend on 11 March, at column 395, we have received over 700 further letters concerning health services in Shropshire. None has expressed support for hospital closures in the district. All will be taken into account if proposals come to Ministers for decision.

  Spending Power
  Mr. Frank Field
  To ask the Secretary of State for Social Services when he expects to reply to the question from the hon. Member for Birkenhead on net weekly spending power to which he gave a holding reply on 25 April.

  Mr. Portillo
  I have replied to the hon. Member today.

  Mr. Ralph Howell
  To ask the Secretary of State for Social Services if he will publish tables similar to his Department's tax benefit/model table, and assuming in each case that 25 per cent. of income is spent on housing costs, showing the net weekly spending power for each of(a) a single person, (b) a married couple with no children, (c) a couple with a child aged 11 years, (d) a couple with two children aged eight and 11 years, (e) a couple with three children aged eight, 11 and 15 years and (f) a couple with four children aged three, eight, 11 and 15 years, with weekly earnings of (i) £180, (ii) £190, (iii) £200, (iv) £250, (v) £300 and (vi) £400, under (A) the original tax and benefit system and (B) the new system implemented in April.

  Mr. Scott
  I regret that the reply can be supplied only at disproportionate cost.

  Mr. Frank Field
  To ask the Secretary of State for Social Services whether the figures given comparing net weekly spending power under the supplementary benefit system with those under income support, 11 March,Official Report, columns 406–8 take into consideration the fact that under the new regulations claimants will have to pay water rates and 20 per cent. of general rates.

  Mr. Portillo
  [holding answer 25 April 1988]: The figures, at columns 406–8, Official Report, 11 March, show the actual cash receipts of claimants, from which they would be required to pay water rates (pre- and post-reform) and the minimum contribution to general rates (post-reform). There is therefore an inadvertent inconsistency in the treatment of general rates which the footnotes should have highlighted. The revised table shows the net position after all housing costs and water rates have been paid. They also include revised estimates of the hypothetical supplementary benefit assessments which such recipients might have received, had the reforms not been introduced.
  551

  Illustrative income support cases April 1988—£pw Old and new income related benefit systems compared

  Supplementary benefit

  Income support

  Net change

  Claimant's net incomes after any contributions toward housing costs and water services

  1. Rent paying lone-parent, two children aged 4 and 11, claiming three months

  60·40

  67·00

  +6·60

  2. Lone-parent with mortgage, three children under 10, claiming six months. Attendance allowance, heating and laundry additions for one child

  96·15

  98·60

  +2·45

  3. Rent-paying lone-parent, one child aged 12, part-time earnings £25, claiming under one year

  59·50

  71·70

  +12·21

  4. Single unemployed man aged 30, non-householder

  29·35

  33·40

  +4·05

  5. Pensioner aged 76, diet and heating addition, non-householder

  64·35

  66·45

  +2·10

  6. Single woman aged 26, severe disability allowance, and heating addition, non-householder

  36·10

  46·45

  +10·35

  7. Unemployed man, wife and a child aged 3. Rentpayer

  63·85

  65·07

  +1·22

  8. Single man, sick, new claim, rented accommodation

  31·40

  32·80

  +1·40

  Net income from all sources

  9. Sick man paying a mortgage, non-working wife, two children aged 3, claiming eight months

  78·26

  95·93

  +17·67

  10. Unemployed man, non-working wife, three children aged 3, 11 and 12. LA accommodation

  102·98

  104·02

  +1·04

  11. Single man aged 28, sick 7 months, additional requirements for laundry and diet, owner-occupier

  38·60

  43·85

  +5·25

  12. Single man, living alone, rented accommodation, attendence allowance and additional requirements for heating and diet, disabled over a year

  70·30

  90·27

  +19·97

  13. Unemployed man, wife sick, receiving a severe disability allowance with additional requirements for heating and laundry

  59·20

  67·12

  +7·92

  14. Pensioner aged 82, rented accommodation

  41·30

  43·17

  +1·87

  15. Pensioner aged 82, wife aged 77, owner-occupier

  65·25

  65·54

  +0·29

  Notes:

  1. Hypothetical April 1988 supplementary benefit rates, pre-reform housing benefit rates and housing costs assumptions as in "Impact of the Reformed Structure of Income Related Benefits", October 1987.

  2. Based on average local authority rates by family and tenure type. Water service payments are varied directly with local authority rates. All illustrations are based on local authority tenants except where owner-occupiers or non-householders are specified for the illustrations.

  Overseas Pensioners
  Mr. Andrew Bowden
  To ask the Secretary of State for Social Services what is the total number of pensioners overseas currently in receipt of United Kingdom pensions; and if he will give(a) the number in countries where annual increments apply and (c) the number of countries where annual increments do not apply.

  Mr. Scott
  The total number of persons overseas in receipt of United Kingdom retirement pensions and widows benefits in December 1987 was 461,422. These are the latest figures available. The numbers in each country are as follows:

  Number

  Albania

  5

  Alderney

  502

  Algeria

  3

  American Samoa

  1

  Andorra

  123

  Angola

  1

  Anguilla

  62

  Antarctic (British)

  1

  Antigua

  166

  Argentina

  162

  Ascension Island

  5

  Australia

  117,659

  Austria

  2,462

  Bahamas

  124

  Bahrain

  17

  552

  Number

  Bangladesh

  2,711

  Barbados

  1,019

  Barbuda

  1

  Belgium

  3,408

  Belize

  11

  Benin

  1

  Bermuda

  278

  Bolivia

  3

  Botswana

  48

  Brazil

  179

  Brunei

  9

  Bulgaria

  9

  Burkina Faso

  1

  Burma

  6

  Cameroon

  4

  Canada

  76,152

  Cayman Islands

  41

  Central Africa Republic

  2

  Channel Islands

  1

  Chile

  52

  China

  15

  Colombia

  22

  Cook Islands

  5

  Costa Rica

  6

  Cote D'ivoire

  1

  Cyprus

  2,848

  Czechoslovakia

  29

  Denmark

  326

  Djibouti

  4

  Dominica, Commonwealth of

  344

  Dominican Republic

  161

  East Germany

  19

  553

  Number

  Egypt

  45

  El Salvador

  1

  Equador

  9

  Ethiopia

  4

  Falkland Islands and Dependencies

  8

  Faroe Islands

  2

  Fiji

  25

  Finland

  64

  France

  5,796

  Gambia

  10

  Ghana

  57

  Gibraltar

  340

  Greece

  923

  Grenada

  430

  Guadeloupe, French Guiana, Martinique and Reunion Island

  5

  Guatemala

  3

  Guernsey

  4,570

  Guinea

  1

  Guyana

  146

  Haiti

  1

  Honduras

  2

  Hong Kong

  447

  Hungary

  159

  Iceland

  24

  India

  3,334

  Indonesia

  19

  Iran

  2

  Iraq

  2

  Irish Republic

  49,259

  Israel

  2,270

  Italy

  10,366

  Jamaica

  12,617

  Japan

  52

  Jersey

  6,321

  Jordan

  7

  Kenya

  443

  Kiribati

  3

  Kuwait

  6

  Lebanon

  19

  Lesotho

  5

  Liberia

  4

  Libya

  2

  Liechtenstein

  2

  Luxembourg

  55

  Macau

  1

  Madagascar

  3

  Malawi

  54

  Malaysia

  65

  Malta

  1,713

  Mauritius

  123

  Mexico

  87

  Monaco

  197

  Montserrat

  221

  Morocco

  32

  Mozambique

  3

  Nauru, Republic of

  3

  Nepal

  19

  Netherlands

  2,524

  Netherlands Antilles

  6

  New Zealand

  27,957

  Nicaragua

  3

  Nigeria

  119

  Norfolk Island

  13

  Norway

  189

  Oman

  11

  Pakistan

  5,514

  Panama

  4

  Papua New Guinea

  15

  Paraguay

  2

  Peru

  41

  Philippines

  64

  Poland

  2,445

  Portugal

  1,718

  Puerto Rico

  7

  Quatar

  10

  Rumania

  18

  554

  Number

  Rwanda

  2

  St. Helena and Dependencies

  37

  St. Kitts-Nevis

  324

  St. Lucia

  535

  St. Vincent

  322

  San Marino

  2

  Sarawak

  2

  Sark

  79

  Saudi Arabia

  32

  Senegal

  7

  Seychelles

  30

  Sharjah

  1

  Sierra Leone

  45

  Singapore

  88

  Solomon Islands

  7

  Somalia

  191

  South Africa

  25,273

  South Korea

  1

  South West Africa or Namibia

  14

  Spain

  17,592

  Sri Lanka

  137

  Sudan

  9

  Swaziland

  58

  Sweden

  78

  Switzerland

  1,829

  Syria

  2

  Taiwan

  5

  Tanzania

  37

  Thailand

  64

  Tonga

  3

  Trinidad and Tobago

  347

  Tunisia

  6

  Turkey

  262

  Turks and Caicos Islands

  4

  Tuvalu

  1

  Uganda

  17

  United Arab Emirates

  30

  USA

  41,860

  USSR

  783

  Uruguay

  21

  Vanuatu

  4

  Vatican City

  1

  Venezuela

  31

  Virgin Islands

  45

  Western Samoa

  12

  West Germany

  11,632

  Yemen Arab Republic

  1,028

  Yemen, Peoples Democratic Republic of

  134

  Yugoslavia

  984

  Zaire

  4

  Zambia

  131

  Zimbabwe

  4,454

  The number of countries where annual increments apply is 182,746. The number of countries where annual increments do not apply and where United Kingdom pensioners are living is 145, and the number of pensioners in those countries is 275,901. There was a further 2,775 pensioners whose country of residence was not known at the time the statistics were prepared.

  Invalid Care Allowance
  Mr. Robin Cook
  To ask the Secretary of State for Social Services if he will disregard the invalid care allowance in assessing entitlement to income support and national insurance benefits.

  Mr. Scott
  No. Invalid care allowance, income support and national insurance benefits are maintenance benefits, intended to cover a person's day-to-day living expenses. To disregard invalid care allowance when assessing entitlement to income support or national insurance benefits would mean that provision was being made twice over from public funds to cover the same needs.

  Supplementary Benefit Claimants (Nottingham)
  Mr. Allen
  To ask the Secretary of State for Social Services if, pursuant to the reply of 10 May,Official Report, columns 89–90, he will supply the numbers for the disabled pensioners, single parents and other groups by
  category in the statistics for those claiming supplementary benefit in 1979 and in 1987 for the David Lane and Shakespeare street offices of his Department in Nottingham.

  Mr. Portillo
  Information is not available in the precise
  form requested.

  The number of supplementary benefit claimants by category at 27 November 1979 and 18 November 1987 for the offices requested is as follows:

  David Lane

  Shakespeare street

  1979

  1987

  1979

  1987

  Claimant Category

  Over pension age

  3,163

  3,360

  4,988

  5,146

  Required to register for employment

  1,530

  5,228

  1,906

  5,265

  Required to register for employment once a quarter

  165

  522

  205

  679

  Not required to register for employment:

  Women aged under 60 and receiving Widow's Benefit

  83

  37

  49

  58

  Men aged 60–64

  —

  206

  —

  444

  One-parent families with child(ren) under age 16

  1,067

  2,065

  1,236

  2,372

  Incapable of work because of sickness or disability

  501

  823

  653

  1,043

  Required at home to care for aged or sick person aged 16 or over

  39

  58

  51

  78

  Others

  126

  244

  116

  335

  Source: 100 per cent, count of cases in action.

  Some claimants may fit a number of categories, but each claimant is counted only once for statistical purposes.

  Benefits (Homeless Claimants)
  Mr. Jim Marshall
  To ask the Secretary of State for Social Services what has been the effect on the street homelessness of benefit payments to homeless claimants being paid in arrears rather than in advance; and if he will
  make a statement.

  Mr. Portillo
  The arrangements for paying income support in arrears to the majority of recipients under pension age, including homeless people, began only recently on 11 April. It is too early to judge the effects of this change on homeless claimants. Moreover, by their very nature the number of people in this group is difficult
  to estimate. However, we will monitor any indicators of change, such as representations from organizations dealing with homeless people.

  Electorate (Non-metropolitan Districts)
  Mr. Simon Coombs
  To ask the Secretary of State for
  Social Services if he will list the 30 English non-metropolitan districts which have shown the greatest percentage growth in their electorate since 1978, and what have been the percentage growth and actual figures in each case.

  Mrs. Currie
  The information requested is as follows:556

  Non-metropolitan district

  Total electors

  Difference

  1978

  1988

  Actual

  Percentage growth

  Milton Keynes

  70,545

  119,534

  48,989

  69

  Redditch

  40,424

  55,422

  14,998

  37

  Wokingham

  76,902

  103,845

  26,943

  35

  Tamworth

  38,075

  49,725

  11,650

  31

  Peterborough

  84,885

  110,097

  25,212

  30

  Huntingdonshire

  77,134

  99,242

  22,108

  29

  Hart

  48,680

  62,187

  13,507

  28

  East Dorset

  49,965

  63,486

  13,521

  27

  The Wrekin

  79,066

  98,940

  19,874

  25

  Newbury

  81,711

  102,017

  20,306

  25

  Thamesdown

  102,038

  127,259

  25,221

  25

  Aylesbury Vale

  85,580

  106,702

  21,122

  25

  South Staffordshire

  65,620

  81,627

  16,007

  24

  East Hampshire

  61,584

  76,592

  15,008

  24

  Eastleigh

  63,059

  78,277

  15,218

  24

  Crawley

  53,541

  66,435

  12,894

  24

  Fareham

  60,919

  75,542

  14,623

  24

  Basingstoke and Deane

  86,068

  106,299

  20,231

  24

  Northampton

  107,756

  132,859

  25,103

  23

  Caradon

  47,502

  58,433

  10,931

  23

  Test Valley

  61,596

  75,713

  14,117

  23

  Selby

  55,994

  68,758

  12,764

  23

  West Wiltshire

  69,419

  84,750

  15,331

  22

  Cherwell

  67,591

  82,501

  14,910

  22

  Chelmsford

  95,415

  116,230

  20,815

  22

  South Cambridgeshire

  73,245

  88,905

  15,660

  21

  Woodspring

  114,914

  139,344

  24,430

  21

  Maldon

  33,576

  40,532

  6,956

  21

  Bracknell

  51,401

  62,025

  10,624

  21

  Daventry

  39,573

  47,721

  8,148

  21

  Data Protection
  Mr. Cohen
  To ask the Secretary of State for Social Services if he will introduce legislation specifically to prohibit any information collected for health purposes being disclosed to community charge officer; and if he will make a statement.

  Mrs. Currie
  No. Health authorities and family practitioner committees are already obliged to keep information received for health purposes confidential.

  Employment Status (Disputes)
  Mr. David Howell
  To ask the Secretary for Social Services how many cases in which employed or self-employed status was in dispute came to the attention of officials in his Department in 1987.

  Mr. Portillo
  This information is not available. However, there is a procedure whereby a person who disputes a departmental ruling can have it formally referred for determination by the Secretary of State: and there were 85 such references involving employment status in 1987.

  Health Spending
  Ms. Harman
  To ask the Secretary of State for Social Services if he will now publish a table showing for 1986, for each member state of the European Economic Community (i) total, (ii) public and (iii) private spending on health as a proportion of gross domestic product.

  Mr. Newton
  The available data for 1986 from the Organisation for Economic Co-operation and Development are as follows:
  557

  Expenditure on health care as a percentage of GDP, 1986

  Total, of which:

  Public

  Private

  Belgium

  7·1

  5·5

  1·6

  Denmark

  n/a

  n/a

  n/a

  France

  8·5

  6·7

  1·8

  Germany

  8·1

  6·3

  1·8

  Greece

  3·9

  3·7

  0·2

  Ireland

  n/a

  n/a

  n/a

  Italy

  6·7

  5·2

  1·5

  Netherlands

  8·3

  6·5

  1·8

  Portugal

  n/a

  n/a

  n/a

  Spain

  n/a

  n/a

  n/a

  United Kingdom

  6·2

  5·4

  0·8

  Oxford region

  Revenue expenditure

  Capital expenditure

  District health authorities

  Per annual accounts £'000

  At 1986–87 prices £'000

  Proportion of total Per cent.

  Per annual accounts £'000

  At 1986–87 prices £'000

  Proportion of total Per cent.

  1982–83

  East Berkshire

  43,549

  52,098

  13·3

  4,371

  5,229

  18·5

  West Berkshire

  58,175

  69,595

  17·8

  2,094

  2,505

  8·8

  Aylesbury Vale

  34,108

  40,804

  10·5

  708

  847

  3·0

  Wycombe

  23,762

  28,427

  7·3

  1,200

  1,435

  5·1

  Milton Keynes

  7,091

  8,483

  2·2

  7,508

  8,982

  31·7

  Kettering

  25,677

  30,718

  7·9

  664

  794

  2·8

  Northampton

  46,424

  55,537

  14·2

  2,885

  3,451

  12·2

  Oxfordshire

  87,491

  104,666

  26·8

  4,222

  5,051

  17·9

  Districts-Total

  326,277

  390,328

  100·0

  23,652

  28,294

  100·0

  1983–84

  East Berkshire

  45,931

  52,481

  13·4

  7,547

  8,623

  30·3

  West Berkshire

  59,876

  68,415

  17·5

  1,927

  2,202

  7·7

  Aylesbury Vale

  33,850

  38,677

  9·9

  1,187

  1,356

  4·8

  Wycombe

  24,528

  28.026

  7·2

  1,086

  1,241

  4·4

  Milton Keynes

  9,259

  10,579

  2·7

  5,670

  6,478

  22·7

  Kettering

  26,821

  30,646

  7·9

  1,019

  1,164

  4·1

  Northampton

  49,419

  56,467

  14·5

  3,526

  4,029

  14·1

  Oxfordshire

  92,073

  105,204

  26·9

  2,969

  3,392

  11·9

  Districts-Total

  341,757

  390,495

  100·0

  24,931

  28,485

  100·0

  1984–85

  East Berkshire

  47,527

  52,007

  12·8

  6,915

  7,567

  28·7

  West Berkshire

  64,061

  70,099

  17·3

  2,048

  2,241

  8·5

  Aylesbury Vale

  36,743

  40,206

  9·9

  2,203

  2,411

  9·1

  Wycombe

  25,808

  28,240

  7·0

  1,808

  1,978

  7·5

  Milton Keynes

  16,224

  17,753

  4·4

  1,581

  1,730

  6·6

  Kettering

  29,497

  32,277

  8·0

  1,377

  1,507

  5·7

  Northampton

  52,193

  57,112

  14·1

  4,823

  5,277

  20·0

  Oxfordshire

  97,832

  107,053

  26·5

  3,337

  3,651

  13·9

  Districts-Total

  369,885

  404,747

  100·0

  24,092

  26,362

  100·0

  1985–86

  East Berkshire

  50,361

  52,003

  12·9

  6,783

  7,004

  26·4

  West Berkshire

  67,196

  69,386

  17·3

  4,535

  4,683

  17·7

  Aylesbury Vale

  38,457

  39,711

  9·9

  3,398

  3,509

  13·2

  Wycombe

  27,751

  28,656

  7·1

  1,677

  1,732

  6·5

  Milton Keynes

  18,580

  19,186

  4·8

  320

  330

  1·3

  Kettering

  30,846

  31,851

  7·9

  1,347

  1,391

  5·2

  Northampton

  53,389

  55,129

  13·7

  2,455

  2,535

  9·6

  Oxfordshire

  102,845

  106,198

  26·4

  5,153

  5,321

  20·1

  Districts-Total

  389,425

  402,120

  100·0

  25,668

  26,505

  100·0

  1986–87

  East Berkshire

  54,411

  54,411

  13·0

  5,447

  5,447

  19·2

  West Berkshire

  72,384

  72,384

  17·2

  5,350

  5,350

  18·9

  Aylesbury Vale

  41,497

  41,497

  9·9

  4,380

  4,380

  15·5

  Wycombe

  29,943

  29,943

  7·1

  1,414

  1,414

  5·0

  Milton Keynes

  21,031

  21,031

  5·0

  2,448

  2,448

  8·6

  Kettering

  32,749

  32,749

  7·8

  1,235

  1,235

  4·4

  558
  Source: OECD

  Note: Luxumbourg is excluded from the table because of reported inconsistencies in the national health accounts.

  Health Authorities (Oxford)
  Mr. Andrew Smith
  To ask the Secretary of State for Social Services if he will list the expenditure of the district health authorities of the Oxford region in each of the last 10 years(a) in cash, (b) adjusted for inflation and (c) expressed as a percentage of the regional total.

  Mr. Newton
  Following is information derived from the annual accounts of the district health authorities in the Oxford region from their establishment on 1 April 1982 until 1986–87 (the latest year available):
  559

  Oxford region

  Revenue expenditure

  Capital expenditure

  District health authorities

  Per annual accounts £'000

  At 1986–87 prices £'000

  Proportion of total Per cent.

  Per annual accounts £'000

  At 1986–;87 prices £'000

  Proportion of total Per cent.

  Northampton

  57,013

  47,013

  13·6

  2,249

  2,249

  7·9

  Oxfordshire

  110,946

  110,946

  26·4

  5,821

  5,821

  20·5

  Districts-Total

  419,974

  419,974

  100·0

  28,344

  28,344

  100·0

  Disabled Persons Act 1986
  Mr. Wigley
  To ask the Secretary of State for Social Services, pursuant to his answer to the hon. Member for Caernarfon of 1 March,Official Report, column 552, if he will give the dates on which meetings have taken place with representatives of local authorities on the implementation of the Disabled Persons Act 1986.

  Mr. Scott
  Since the Disabled Persons (Services, Consultation and Representation) Act received the Royal Assent on 8 July 1986, meetings with representatives of the local authority associations for England have taken place on the following dates:

  4 July 1986

  19 December 1986

  24 February 1987

  14 April 1987

  14 May 1987

  2 June 1987

  15 June 1987

  9 October 1987

  20 October 1987

  Apart from these formal meetings there have been frequent contacts with the association about the Act.

  Resource Allocation Working Party
  Mr. Mullin
  To ask the Secretary of State for Social Services when he expects that the revision of the national resource allocation working party will be complete; and if he will make a statement.

  Mr. McCrindle
  To ask the Secretary of State for Social Services (1) if he has any plans to improve the operation of the resource allocation working party; and if he will make a statement;

  (2) if he has received the report of the working party on the resource allocation working party; if he will publish the report; and if he will make a statement.

  Mr. Newton
  The programme of analysis and research undertaken for the review of the resource allocation working party has been completed, and we are considering the resulting recommendations from the NHS Management Board. A statement will be made in due course.

  Mr. McCrindle
  To ask the Secretary of State for Social Services if he will indicate for each of the years it has operated the proportion of total expenditure allocated through the resource allocation working party formula to each of the Thames health regions; and if he will make a statement.

  Mr. Newton
  The table shows the proportion of the total revenue resources available for distribution under the terms of the resource allocation working party formula allocated to each of the Thames regional health authorities since 1977–78.
  560

  Region

  Total Thames Regions

  Years

  North West Thames

  North Eiist Thames

  South East Thames

  South West Thames

  1977–78

  8·5

  9·5

  9·0

  7·2

  34·2

  1978–79

  8·4

  9·3

  8·9

  7·1

  33·7

  1979–80

  8·3

  9·2

  8·8

  7·0

  33·3

  1980–81

  8·3

  9·2

  8·7

  7·0

  33·2

  1981–82

  8·2

  9·1

  8·7

  7·0

  33·0

  1982–83

  8·0

  9·4

  8·6

  6·9

  32·9

  1983–84

  7··7

  9·7

  8·5

  6·7

  32·6

  1984–85

  7·7

  9·5

  8·5

  6·6

  32·3

  1985–86

  7·6

  9·4

  8·4

  6·5

  31·9

  1986–87

  7·5

  9·4

  8·3

  6·1

  31·6

  1987–88

  7·3

  9·1

  8·1

  6·8

  31·3

  1988–89

  7·3

  9·1

  8·1

  6·7

  31·2

  Note Excludes elements of funding protected from the redistributive effect of RAWP, for example, the service increment for teaching and supra-regional services funding. Similarly excludes funding directed at specific service needs: for example AIDS and breast cancer screening.

  Mr. McCrindle
  To ask the Secretary of State for Social Services if he has any plans to review the proportion of total expenditure provided to the Thames health regions; and if he will make a statement.

  Mr. Newton
  We will consider the position of all regional health authorities, and the pace at which their resource allocations are brought into line with their target shares of the available resources, in updating regions' planning assumptions for 1989–90, which we hope to issue soon.

  The review of the resource allocation working party formula has of course been re-examining the way in which regional targets are calculated. We shall therefore need to consider carefully, in determining regions' annual allocations in future, the pace at which we should take account of any changes which may flow from the review.

  Social Security Reform
  Mr. Tony Banks
  To ask the Secretary of State for Social Services how much has been budgeted for by his Department for advertising and activities associated with the changes in social security provisions; and how much has been spent to date.

  Mr. Portillo
  Total spending up to the beginning of the current financial year by the Department's information division on providing factual information (leaflets, technical guides as well as advertising) about changes in social security provisions was approximately £12 million.

  It is expected that a similar sum will be spent in the current financial year. To date about £1·5 million has been spent.

  Claimants (Local Records)
  Mr. Corbett
  To ask the Secretary of State for Social Services whether he will now require local offices of his Department, serving parts of neighbouring parliamentary constituencies, to maintain records of claimants under each type of benefit, grant or loan on a constituency basis.

  Mr. Portillo
  Local office areas are not conterminous with parliamentary constituencies. It would be impractical to maintain local office records of claimants on a constituency basis.

  Housing Benefit
  Mr. Mullin
  To ask the Secretary of State for Social Service whether the recently announced payments of

  Births under 2,500 grams, perinatal and infant mortality rates, period fertility rates and crude birth rates; data and rankings6 London boroughs 1986

  London Borough

  Proportion of all births under 2,500 grams

  Perinatal mortality2

  Deaths under 1 year3

  Total period fertility rate4

  Crude birth rates5

  Rate

  Rank

  Rate

  Rank

  Rate

  Rank

  Rate

  Rank

  Rate

  Rank

  City of London1

  5·7

  3·3

  0·0

  3·3

  0·0

  3·3

  0·99

  3·3

  7·2

  3·3

  Barking and Dagenham

  6·5

  2·8

  9·1

  1·7

  12·1

  2

  1·91

  9

  14·0

  1·7

  Barnet

  7·2

  2·2

  10·7

  7

  7·7

  23

  1·64

  26

  13·1

  25

  Bexley

  6·4

  30

  5·5

  31

  3·8

  32

  1·72

  22

  13·2

  24

  Brent

  10·6

  1

  10·5

  9

  9·7

  14

  1·78

  16

  15·2

  9

  Bromley

  7·5

  17

  7·0

  23

  6·4

  29

  1·66

  24

  11·5

  31

  Camden

  8·4

  8

  9·6

  16

  10·1

  12

  1·33

  31

  12·4

  29

  Croydon

  7·0

  23

  10·0

  12

  10·9

  8

  1·86

  12

  14·4

  14

  Ealing

  7·8

  13

  6·6

  26

  5·5

  31

  1·69

  23

  14·3

  15

  Enfield

  7·7

  15

  6·5

  28

  6·8

  28

  1·77

  17

  13·3

  23

  Greenwich

  7·5

  17

  11·1

  5

  10·0

  13

  1·89

  10

  15·2

  9

  Hackney

  9·2

  3

  10·6

  8

  11·6

  3

  2·07

  3

  18·0

  3

  Hammersmith and Fulham

  6·8

  27

  4·9

  32

  8·3

  20

  1·46

  30

  13·5

  19

  Haringey

  8·0

  12

  9·7

  15

  9·1

  16

  1·94

  7

  16·2

  6

  Harrow

  7·7

  15

  10·5

  9

  11·6

  3

  1·81

  14

  13·7

  18

  Havering

  5·8

  32

  11·3

  3

  10·7

  9

  1·58

  28

  11·4

  32

  Hillingdon

  7·4

  19

  7·6

  22

  7·0

  26

  1·76

  18

  13·5

  19

  Hounslow

  8·2

  10

  8·6

  18

  11·3

  5

  2·03

  4

  15·5

  8

  Islington

  8·1

  11

  10·8

  6

  8·8

  17

  1·66

  24

  14·8

  12

  Kensington and Chelsea

  6·5

  28

  6·8

  25

  6·2

  30

  1·26

  32

  12·9

  26

  Kingston-upon Thames

  7·4

  19

  5·8

  30

  6·9

  27

  1·73

  19

  12·9

  26

  Lambeth

  8·9

  6

  8·0

  21

  13·2

  1

  1·88

  11

  16·7

  4

  Lewisham

  7·8

  13

  6·9

  24

  9·2

  15

  1·82

  13

  14·9

  12

  Merton

  7·0

  23

  11·4

  2

  8·0

  22

  1·94

  7

  14·3

  15

  Newham

  9·9

  2

  12·4

  1

  11·0

  7

  2·36

  2

  19·8

  1

  Redbridge

  6·9

  26

  10·0

  12

  10·4

  11

  1·73

  19

  12·6

  28

  Richmond-upon-Thames

  6·4

  30

  6·6

  26

  8·2

  21

  1·60

  27

  12·1

  30

  South wark

  9·0

  5

  10·0

  12

  11·2

  6

  1·99

  5

  16·5

  5

  Sutton

  7·0

  23

  6·2

  29

  8·4

  19

  1·80

  15

  13·4

  22

  Tower Hamlets

  9·2

  3

  8·3

  19

  8·7

  18

  2·38

  1

  19·6

  2

  Waltham Forest

  8·8

  7

  11·3

  3

  10·7

  9

  1·99

  5

  16·0

  7

  Wandsworth

  7·4

  19

  8·2

  20

  7·7

  23

  1·73

  19

  14·6

  13

  Westminster; City of

  8·4

  8

  10·4

  11

  7·1

  25

  1·55

  29

  13·5

  19

  1 Rates for the City of London are based on a total of 35 births (all weights); there were no stillbirths or deaths under one year of age.

  2 Perinatal mortality rate: deaths under one week plus stillbirths per 1,000 total births

  3 Infant mortality rate: deaths under 1 year per 1,000 livebirths.

  4 The total period fertility rate (TPFR) represents the average number of children which women would have in their reproductive lifetime if the age-specific fertility rates for each area were to remain constant.

  5 Total births per 1,000 population.

  6 Rankings are from highest to lowest in all cases.

  Child Cancer (Hull)
  Mr. Randell
  To ask the Secretary of State for Social Services whether the small areas health statistics unit will 562
  housing benefit to persons living in sheltered accommodation, while trying to sell their house, are intended to be loans or grants.

  Mr. Portillo
  Neither. As long as a claimant is taking all reasonable steps to dispose of the former home, and provided he qualifies for it on income and other grounds, housing benefit is payable in the same way as for any other claimant.

  Births (London)
  Mr. Tony Banks
  To ask the Secretary of State for Social Services if he will publish in the Official Report the most recent information he has of ranking amongst London boroughs in respect of (a) crude birth rate, (b) period fertility rate, (c) births of less than 2,500 grams, (d) perinatal mortality and (e) deaths under one year.

  Mrs. Currie
  The information is shown in the table. The latest available data year is 1986.

  be involved in the analysis of the child cancer clusters in the Hull area, in the light of the statement of 10 March

  563
  Official Report, columns 750–51 by the Parliamentary Under-Secretary of State, the hon. Member for Lewisham, East (Mr. Moynihan).

  Mrs. Currie
  I refer the hon. Member to my reply to my hon. Friend the Member for Beverley (Mr. Cran) on 30 March 1988, at columns 550–51.

  Bronchitis and Emphysema
  Mr. David Shaw
  To ask the Secretary of State for Social Services whether the report on bronchitis and emphysema by the Industrial Injuries Advisory Council has been published; and if he will make a statement.

  Mr. Scott
  The Industrial Injuries Advisory Council's report on bronchitis and emphysema is published today and a copy has been placed in the Library. The council concludes that there is insufficient evidence at the present time to warrant prescription, under the terms of section 76(2) of the Social Security Act 1975, of bronchitis and emphysema as industrial diseases in their own right.

  The council calls for more research into non-smoking dust-exposed workers and undertakes to review the subject again when such evidence becomes available. It also announces that a separate investigation will be conducted into respiratory disease in welders. Finally, the report clarifies that emphysema caused by inhaled cadmium fume is already covered under the terms of prescription of the prescribed disease C18 (poisoning by cadmium).

  We have accepted the council's conclusions and recommendations.

  St. Albans (Electorate)
  Mr. Robert B. Jones
  To ask the Secretary of State for Social Services whether he will set out a table showing the 1988 electorate for each ward in the district of St. Albans.

  Mrs. Currie
  The information requested is as follows:

  District of St. Albans

  Ward Name

  Number1

  St. Albans Parliamentary Constituency

  Batchwood

  4,893

  St. Peter's

  4,605

  Verulam

  5,205

  Sopwell

  4,898

  Cunningham

  4,841

  Ashley

  4,945

  Clarence

  4,357

  Marshalswick South

  5,215

  Harpenden North

  5,967

  Harpenden East

  5,073

  Harpenden South

  5,139

  Harpenden West

  5,184

  Colney Heath

  2,797

  Sandridge

  3,689

  Marshalswick North

  4,997

  Redbourn

  4,524

  Herlsmere Parliamentary Constituency

  London Colney

  5,557

  Watford Parliamentary Constituency

  Park Street

  4,392

  St. Stephen

  5,747

  Welwyn Hatfield Parliamentary Constituency

  Wheathampstead

  4,8741

  1 Parliamentary Electorate on the 1988 Register.

  Household Incomes
  Mr. Carttiss
  To ask the Secretary of State for Social Services if he will publish the new statistics on households with below average incomes, as recommended in the technical report placed in the Library on 29 March; and if he will make a statement.

  Mr. Portillo
  Following the recommendations in the report of the technical review of the DHSS low income statistics, which was placed in the Library on 29 March, I have today placed in the Library the first edition of the new series "Households below average income: a statistical analysis". The tables cover the years 1981, 1983 and 1985. In addition, I have also placed in the Library the final edition of the "Low Income Families" figures covering the same years.

  The tables show that living standards have been rising significantly, and that those with the lowest incomes have shared in the improvements. Indeed, between 1981 and 1985 the average incomes of those in the bottom tenth rose by over 8 per cent.—well ahead of the average increases for the population as a whole.

  Premature Births
  Mrs. Ann Winterton
  To ask the Secretary of State for Social Services what information he has concerning the number of premature babies born in each of the last five years which have survived at(a) 24 weeks gestation, (b) 25 weeks gestation, (c) 26 weeks gestation, (d) 27 weeks gestation and (e) 28 weeks gestation; and if he will make a statement.

  Mr. Newton
  [holding answer 16 May 1988]Information is not available in precisely the form requested.

  The nearest available data are shown in the table. The data have been taken from the maternity section of the "Hospital In-patient Enquiry" (HIPE) and shows the estimated number of babies, born at relevant gestation weeks, who were subsequently discharged alive from NHS hospitals. The data are for England only, for the years 1982–85. 1981 data are not available, whilst 1985 is the last data year for HIPE.

  Estimated number of babies discharged live from NHS maternity hospitals by gestation weeks of birth, England, 1982–85

  24 weeks

  25 weeks

  26 weeks

  27 weeks

  28 weeks

  1982

  97

  162

  226

  399

  422

  1983

  77

  120

  263

  296

  504

  1984

  87

  206

  163

  424

  587

  1985

  163

  152

  196

  316

  468

  Cancer Screening
  Mr. Morley
  To ask the Secretary of State for Social Services (1) what is the average wage for those staff involved in cervical cancer screening;

  (2) how many staff involved with cervical cancer screening earn over £17,000 per annum.

  Mrs. Currie
  [holding answer 18 May 1988]There is not a group of staff occupied wholly on cervical cancer screening. A range of staff in district health authorities and family practitioner committees (for example, GPs, practice nurses, pathologists, laboratory staff, administrative staff)
  565
  are involved to some extent in the programme among their other responsibilities. Information on actual salaries is not held centrally.

NORTHERN IRELAND

  Member's Questions
  Mr. Livingstone
  To ask the Secretary of State for Northern Ireland on what date he intends to provide substantive replies to remaining questions put down by the hon. Member for Brent, East for answer on 26 and 28 April.

  Mr. Stanley
  Substantive replies will be provided as soon as possible.

  Spirit of Enniskillen Bursaries
  Sir John Biggs-Davison
  To ask the Secretary of State for Northern Ireland if he will make a statement about the purpose, scope and funding of the Spirit of Enniskillen bursaries.

  Dr. Mawhinney
  In introducing this bursary scheme my aim is to capture for future generations of young people the spirit of forgiveness and tolerance which emerged following the tragic bombing in Enniskillen on Remembrance Sunday last year.

  The scheme will give young people from Northern Ireland the opportunity to experience at first hand, in a country of their choice, how people from diverse backgrounds can live together in peace and harmony and then use the knowledge gained to foster better community understanding and tolerance at home.

  I have provided a sum of £150,000 to the King George VI Memorial Council for investment, the income from which will be made available through the Youth Committee for Northern Ireland for the award of bursaries to mixed groups of Protestant and Catholic young people selected by a special panel which I shall appoint.

  Between 24 and 30 young people will be selected—equally from across the religious divide for—bursaries each year.

  Consultant, and initial year of consultancy

  Projects

  Cost to arts programme £

  1984–85

  Mr. J. Gray

  Support for the Library and Information Services Council Working Party on Manpower, Education, and Training Requirements for Library and Information Work.

  2,000

  Mrs. D. Edmonds

  Research leading to publiction of 'Current Library, Co-operation and Co-ordination'

  113,650

  Volunteer Centre

  Survey of work of Volunteers in Museums and Galleries in the United Kingdom

  11,400

  Policy Studies Institute

  Facts about the Arts II

  125,000

  1985–86

  Charities Advisory Trust

  Study and Preparation of the 'Museums Trading Handbook'.

  122,879

  Museums Association

  Museums Database Project

  185,600

  Policy Studies Institute

  Study of the Economic Importance of the Arts

  148,000

  Mr. L. Brandes

  An Efficiency Scrutiny of the National Film and Television School

  12,000

  1986–872

  566
  The only condition I have set is that two places be earmarked each year exclusively for young people from the Enniskillen area, one from each tradition.

  Irish Language
  Mr. McGrady
  To ask the Secretary of State for Northern Ireland (1) what percentage of secondary schools in Northern Ireland taught Irish in the academic years 1985–1986, 1986–1987 and 1987–1988;

  (2) what percentage of grammar schools in Northern Ireland taught Irish in the academic years 1985–1986, 1986–87 and 1987–1988.

  Dr. Mawhinney
  [holding answer 16 May 1988]: This information is not readily available for the 1985–86 and 1987–88 years and could be obtained only at disproportionate cost. In 1986–87, 39·4 per cent. of all secondary schools taught Irish—the figure for secondary intermediate schools being 38·4 per cent. and for grammar schools 41·9 per cent.

  Mr. McGrady
  To ask the Secretary of State for Northern Ireland whether a quota system operates in relation to students who wish to study Irish/Celtic studies as part of the Bachelor of Education degree course in Northern Ireland.

  Dr. Mawhinney
  [holding answer 16 May 1988]: No. Quotas are operated only in relation to overall intakes; institutions determine the number of places to be offered in each subject, provided numbers meet normal viability criteria.

THE ARTS

  Arts Consultants
  Mr. Fisher
  To ask the Minister for the Arts whether he will list the arts consultants that his Department has employed in each of the past five years, the projects on which they have worked and the cost per consultancy.

  Mr. Luce
  [holding answer 29 April 1988]: The Office of Arts and Libraries was established in July 1983. I list the arts consultants employed by the Office of Arts and Libraries from 1984–85 to 1987–88.
  567

  Consultant, and initial year of consultancy

  Projects

  Cost to arts programme £

  British Library Research and Development Department, and the Institute of Public Finance

  Research leading to the publication of 'A Service Costing System for Public Libraries'.

  122,000

  Area Museums Service for South-Eastern England

  Research and Preparation of 'Museums— The New Exams'

  5,000

  Oxfordshire County Council

  Development of model computerised system to administer County Museums' Loan Services

  6,200

  1987–882

  Library Association

  Feasibility study into the restructuring of the National Committee on Regional Library Cooperation

  2,500

  Mr. C. Turner

  Preparation of the Report for the Library and Information Services Council Role of Government Working Party

  1,000

  Mrs. D. Edmonds

  Research into public library services for children and young people

  7,622

  British Library Research and Development Department, and King Research Ltd.

  Development of a manual of performance indicators for public libraries

  15,058

  Museums Association

  Review of museums' training needs

  16,000

  Mr. I. Gibb

  Appraisal of the British Theatre Association Library's tasks

  1,231

  Mr. P. Collard

  Research leading to report 'Arts and the Inner Cities'

  5,900

  Simmonds Consultancy

  Art in Government Offices: Young Artists Project

  1,380

  British American Arts Association

  Arts and City Planning

  5,000

  Mr. R. de Peyer

  Research and preparation of the publication 'Museums Projects' (a Handbook for Volunteers Community Programme Work Experience and Temporary Staffs)

  2,400

  Policy Studies

  Facts about the Arts III

  140,000

  Area Museums Service for South-Eastern England

  Research and Preparation of 'Museums— The New Curriculum'

  6,500

  1 Projects with expenditure in more than one year.

  2 Expenditure of £15,000 in 1986–87 and £20,000 in 1987–88 was incurred on promoting Library and Information Plans in selected authorities under the supervision of the British Library's Research and Development Department.

AGRICULTURE, FISHERIES AND FOOD

  Wheat
  Mr. Ralph Howell
  To ask the Minister of Agriculture, Fisheries and Food, pursuant to the reply to the hon. Member for Great Grimsby (Mr. Mitchell) on 22 February,Official Report, columns 19–20, if he will give the world price for (a) milling wheat and (b) other wheat, for each year since 1979.

  Mr. Donald Thompson
  There is no single world price for wheat. A wide range of prices are quoted, reflecting the different qualities of wheats of different origins. Where large surpluses exist actual trade may take place at prices lower than those quoted.

  The figures are for Canadian Western Red Spring No. 1 (13·5 per cent.), a good quality hard milling wheat, and Argentinian Trigo Pan, a poorer quality wheat which may nevertheless in certain circumstances be used for milling. The figures are officially quoted export prices from those countries and thus do not include any shipping or transport costs or any import levies which may be payable when those grains are imported into other countries.

  World wheat prices

  £/tonne

  Crop year (July-June)

  Canadian

  Argentinian

  1979–80

  89

  86

  1980–81

  97

  89

  568

  Crop year (July—June)

  Canadian

  Argentinian

  1981–82

  107

  97

  1982–83

  115

  92

  1983–84

  131

  94

  1984–85

  145

  102

  1985–86

  126

  71

  1986–871

  95

  56

  1 July to February.

  Source: World Wheat Statistics 1987, published by the International Wheat Council; $ converted to £ at the average rate for the marketing year.

  Mr. Ralph Howell
  To ask the Minister of Agriculture, Fisheries and Food if he will state(a) the lowest and (b) the average price of imported wheat into the United Kingdom for each year since 1979, showing the quantity of all imported wheat in each of these years.

  Mr. Donald Thompson
  The annual quantity and value of all wheat imported into the United Kingdom between 1979 and 1987 are shown in the following table:

  Quantity ('000 tonnes)

  Value (£'000)

  Average Price £ 'tonne

  1979

  2,601

  256,524

  98·6

  1980

  2,256

  232,606

  103·1

  1981

  1,772

  208,186

  117·5

  1982

  1,554

  182,003

  117·1

  1983

  1,326

  180,110

  135·8

  1984

  1,123

  168,283

  149·9

  569

  Quantity ('000 tonnes)

  Value (£'000)

  Average Price £ 'tonne

  1985

  1,614

  230,130

  142·6

  1986

  1,708

  236,185

  138·3

  19871

  1,719

  223,734

  130·2

  1 Provisional.

  The average price has been derived by dividing the quantity by the value. Data on the prices of consignments are not available and it is therefore not possible to determine the lowest yearly prices.

  Near Market Research and Development
  Mr. Steel
  To ask the Minister of Agriculture, Fisheries and Food if he will publish the review being carried out in his Department on near market research and development; and if he will make a statememt.

  Mr. Donald Thompson
  I refer the right hon. Member to the replies given on 1 March, at column 546, to the hon. Member for Bristol, South (Ms. Primarolo) and on 22 April, at column 587, to the hon. Member for Aberdeen, South (Mr. Doran).

  Orchard Replanting
  Mr. Moss
  To ask the Minister of Agriculture, Fisheries and Food if he has any plans to introduce a new scheme under the orchard replanting grant in time for this autumn's planting.

  Mr. Donald Thompson
  Growers were able to benefit from the very generous grants for orchard replanting which were available for the five years until March this year. We are aware of producers' desire for further grants and are considering their case.

  Badgers
  Mr. Ron Davies
  To ask the Minister of Agriculture, Fisheries and Food what progress his Department is making on the live testing of badgers for tuberculosis; and if he will make a statement.

  Mr. Donald Thompson
  Work is continuing at the Ministry's central veterinary laboratory. The results have so far been encouraging. The next step will be to apply the test to infected badgers under field conditions.

  Chernobyl (Compensation)
  Mr. Martlew
  To ask the Minister of Agriculture, Fisheries and Food how many applications have been received from farmers in England other than Cumbria claiming to have suffered losses as a result of the Chernobyl disaster but who had not been compensated under the Government's scheme; when those applications were received and when considered; how many were rejected; and if he will make a statement on the general pattern of the defects in the applications which led to their rejection.

  Mr. Donald Thompson
  None.

  Animal Medicines Licensing
  Mr. Home Robertson
  To ask the Minister of Agriculture, Fisheries and Food if he will make a570
  statement on the progress of the Government's consideration of the Cunliffe review of animal medicines licensing.

  Mr. Donald Thompson
  Organisations representing interests most likely to be affected by the review's recommendations have been asked to send me their comments. Meanwhile, we are giving urgent consideration to internal changes in organisation which would be necessary.

FOREIGN AND COMMONWEALTH AFFAIRS

  Mr. Sidney Clark
  Mr. Corbyn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what actions have been taken by Her Majesty's embassy in Bangkok concerning the situation of Mr. Sidney Clark, held in prison in Thailand.

  Mr. Eggar
  Mr. Clark was imprisoned in Thailand from 23 May 1980 until 1 March 1988.

  Throughout that time he received consular visits at intervals of between four and 10 weeks. Her Majesty's embassy provided facilities for the transfer of funds to him from family and friends. They also negotiated with prison authorities for improvement in his diet. In June 1984 arrangements were made for him to be seen by an embassy panel doctor. He was encouraged to paint and provided with canvasses and paints. Advice was tendered about his plea for a royal pardon. Counselling of a general nature was provided.

  United Kingdom Citizens (Foreign Prisons)
  Mr. Corbyn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what is the total number of United Kingdom citizens known to his Department held in foreign prisons; and what guidelines govern visits by his officials to such prisoners.

  Mr. Eggar
  According to the most recent survey there were, on 10 May 1988, to the best of our knowledge, 1,268 British nationals detained in foreign prisons.

  Standing instructions for British consular officers overseas are that British nationals should be visited as soon as possible after their arrest or detention. Thereafter, they should be visited at reasonable intervals, whether awaiting trial or serving a sentence (unless it has been made clear by the prisoner that visits are not required). Frequency of visits depends on the circumstances of a case, local prison conditions and the situation of a particular prisoner.

  Burmah Endeavour
  Mr. Cohen
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement about the attack on the Burmah Endeavour in the Gulf; and what representations he has made to the Iraqi Government on this matter.

  Mrs. Chalker
  The Burmah Endeavour, a United Kingdom-registered vessel, was hit during an attack by Iraqi aircraft on Larak Island in the southern Gulf, at 0940 hours on 14 May. The ship was set on fire but not badly damaged. There were no casualties.

  The Iraqi ambassador was summoned to the Foreign and Commonwealth Office on 17 May to receive a strong

  571
  protest about this premeditated, unprovoked and unlawful attack. Our ambassador in Baghdad will register a similar protest.

  Philippines
  Mr. Teddy Taylor
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will request the Government of the Philippines to supply a copy of the letter which that Government claim is a request from the British Broadcasting Corporation for an ambush to take place to publicise the activities of rebels in the area; and if he will make a statement.

  Mr. Eggar
  This is a matter for the BBC, which has, I understand, denied allegations of involvement in the ambush. I see no grounds for British Government intervention.

NATIONAL FINANCE

  Building Societies Act 1986
  Mr. Tim Smith
  To ask the Chancellor of the Exchequer what progress has been made on the review of schedule 8 to the Building Societies Act 1986; and if he will make a statement.

  Mr. Lilley
  I have laid two draft orders before the House today. If these orders receive parliamentary approval and are made, the Building Societies Commission, with the consent of the Treasury, intends to make two further orders to complete the package. Copies of provisional drafts of these orders, together with a summary note of the intended provisions of all four orders, have been placed in the Library of the House.

  The orders will implement the main conclusions of the review of schedule 8 to the Building Societies' Act 1986 which I outlined in my statement on 2 February, Official Report, columns 537–39. The orders will do two things. They will recast schedule 8 so that it proscribes particular activities within certain broadly specified powers instead of banning everything except narrowly specified powers. And they will implement a wide-ranging extension of societies' powers to provide financial services, and effectively give societies the full scope permissible within the primary legislation.

  The mainstream business of societies is, and must remain, that of raising funds from the public for lending on house purchase. But we believe that societies should be free to undertake activities which complement their mainstream business and to provide the wider range of finance services which customers now expect. Societies will, as at present, continue to provide services primarily to the personal sector, rather than to companies. The proposed measures will enable them to compete more effectively in their primary markets.

  Societies will, therefore, subject to certain limited restrictions, be allowed:

  (a) to own or take an equity stake in a life insurance company, and to take an equity stake in a general insurance company;

  (b) to own or take an equity stake in stockbrokers;

  (c) to undertake fund management including management of unit trusts generally (rather than just for the provision of pensions, as at present);

  (d) to offer a wider range of banking and housing related services than hitherto.

  572
  The draft Commercial Assets and Services Order which was laid today will replace schedule 8 to the Act with a completely new schedule 8 which will provide six broad service powers:

  Investment services

  Insurance services

  Banking services

  Trusteeship

  Executorship

  Land services

  A society will then be able to provide any service within those general areas unless it is specifically precluded or restricted by other parts of the schedule.

  Societies may need to hold new forms of asset to undertake a wider range of business. This order therefore contains provision for societies to hold leasable chattels (to undertake leasing and hire purchase), residual mortgage debts (to enable them to repurchase the residue of a securitised pool of their mortgages), mortgage finance rights (mortgage backed securities, and similar instruments) and bridging debts (to enable societies more readily to provide temporary bridging finance for house purchase).

  The Building Societies Commission is prepared to examine the possibility of making an order to allow societies to acquire mortgages from other lenders. This will be the subject of further consultation with the Building Societies Association in due course. There are also a number of matters which are consequential to this review. For example, the Commission will be consulting interested parties on the proposed scope of an order to extend the required coverage of the Building Societies Ombudsman scheme to reflect the wider scope of societies' activities as a result of these orders.

  To provide societies with the necessary scope to offer the wider range of services it is proposed to increase the commercial asset limits in the draft limits on commercial assets order which I also laid today. This proposes an increase in the class 2 and 3 limits to 17½ and 7½ per cent., respectively in January 1990, to 20 and 10 per cent., respectively in January 1991 and a further increase to the maximum extent possible within the primary legislation (that is 25 and 15 per cent. respectively), in January 1993.

  Subject to parliamentary approval of these orders, the Building Societies Commission will make a designation of qualifying bodies order to allow societies to invest in or support new subsidiaries to provide the schedule 8 services. They will also, as previously announced, make in due course a limits on lending order to increase the unsecured lending limit to individals to £10,000. I do not expect any substantial changes to these orders from the provisional drafts placed in the Library.

  These proposals are a substantial step forward in building society development. They will give societies the freedom to develop and compete across a wide range of financial services business.

  Government Data Network Project
  Mr. Haselhurst
  To ask the Chancellor of the Exchequer if, following the response of the Paymaster General to the Adjournment debate on 25 February,Official Report, columns 550–54, he is able to announce any further progress on the Government data network project.
  573
  Mr. Brooke
  The Government have examined the feasible options for meeting the foreseen data communications needs of four major Departments (Department of Health and Social Security, Inland Revenue, HM Customs and Excise and Home Office). The costs of these have been compared with the costs of meeting these requirements through a Government data network (GDN). This was based on tenders received in March from the three consortia (Computer Services Company/British Telecom, Racal-Scicon and Cable and Wireless/International Computers Ltd. (known as ICONS)). The comparison showed that, over 10 years, a GDN would be significantly cheaper than the alternatives, even before taking account of the superior service and greater security offered by a GDN.

  The Government have therefore decided to proceed with the Government data network.

  The three competing tenders for the GDN have been comprehensively evaluated and the Government intend to award the contract for the GDN service to Racal-Scicon Ltd., subject to final agreement of terms.

  As I explained to the House on 25 February, at column 547, we have drawn on the most appropriate technical expertise available in both Government and the private sector in designing the arrangements for security and privacy for the GDN service. We have ensured that the Data Protection Registrar has been kept in touch with plans and that he is content with them. We have also kept Oftel informed during the procurement.

  Acceptance testing of the service, using the HM Customs and Excise VALID (VAT Access and Local Input of Data) application system is expected to begin by the end of the year. An operational GDN service will be available early next year.

  Personal Taxation
  Mr. Gordon Brown
  To ask the Chancellor of the Exchequer (1) if he will give the number of people who have no income declared for tax purposes other than unearned income by their highest marginal rate of tax in 1987–88;

  (2) if he will give for 1987–88 the number of people paying tax at (i) 60 per cent., (ii) 55 per cent., (iii) 50 per cent., (iv) 45 per cent. and (v) 40 per cent. who derive (a) 100 per cent., (b) 90 to 100 per cent., (c) 75 to 100 per cent. and (d) 50 to 100 per cent. of their income from unearned income.

  Mr. Norman Lamont
  [holding answers 18 April 1988]: Estimates of tax-paying tax units who derive more than half their income from investment are given in the table. All estimates are subject to considerable uncertainty because they are based on a projection of the 1985–86 survey of personal incomes. Also, the data from the survey on investment income have been adjusted to allow for investment income not reported to tax offices, for example where basic rate liability is satisfied by deduction of tax at source. Estimates for basic rate taxpayers are therefore particularly tentative.
  574

  Number of tax units1 with investment income2 by marginal rate of tax, 1987–883

  Percentage of total income derived from investment income

  Marginal rate per cent.

  100 per cent, thousands

  90–100 per cent, thousands

  75–100 per cent. thousands

  50–100 per cent, thousands

  27

  60

  80

  170

  500

  40

  1

  5

  11

  23

  45

  6

  14

  32

  50

  2

  6

  9

  21

  55

  3

  7

  18

  60

  1

  9

  21

  30

  1 Married couples and single persons.

  2 Excluding pensions.

  3 Treating all investment income as though it were received gross and subject to the individual's appropriate marginal rate.

  Mr. Gordon Brown
  To ask the Chancellor of the Exchequer (1) if he will give figures at 1988–89 prices in the form of tables 1 and 2 of the Inland Revenue press release dated 15 March on independent taxation of husbands and wives classified by joint income of husbands and wives, giving figures for joint incomes of(a) up to £5,000, (b) £5,000 to £10,000, (c) £10,000 to £15,000, (d) £15,000 to £20,000, (e) £20,000 to £25,000, (f) £25,000 to £30,000, (g) £30,000 to £50,000, (h) £50,000 to £75,000, (i) £75,000 to £100,000 and (j) over £100,000, giving the total reduction in tax for each range of joint income;

  (2) if he will give figures for the total reduction in tax separately for husband and wife at 1988–89 prices in the form of tables 1 and 2 of the Inland Revenue press release dated 15 March on independent taxation of husband and wife, classified by joint incomes of husbands and wives, giving figures for joint incomes of (a) up to £5,000, (b) £5,000 to £10,000, (c) £10,000 to £15,000, (d) £15,000 to £20,000, (e) £20,000 to £25,000, (f) £25,000 to £30,000, (g) £30,000 to £50,000, (h) £50,000 to £75,000, (i) £75,000 to £100,000 and (j) over £100,000;

  (3) if he will give figures for the total reduction in tax separately for husband and wife for 1988–89 on the assumption that the independent taxation provisions were operative for 1988–89, in the form of tables 1 and 2 of the Inland Revenue press release dated 15 March on independent taxation of husband and wife, classified by joint incomes of husbands and wives, giving figures for joint incomes of (a) up to £5,000, (b) £5,000 to £10,000, (c) £10,000 to £15,000, (d) £15,000 to £20,000, (e) £20,000 to £25,000, (f) £25,000 to £30,000, (g) £30,000 to £50,000, (h) £50,000 to £75,000, (i) £75,000 to £100,000 and (j) over £100,000, stating the number of husbands and wives falling within each income group.

  Mr. Norman Lamont
  [holding answers 29 April and 9 May 1988]: Available estimates are given in the tables. The reductions in income tax liability relate to a full year at 1990–91 projected levels of income. The 1988 Budget proposals for income tax rates and allowances have been indexed to 1990–91 according to the statutory formula. They are on a consistent basis with the estimates of the direct revenue costs of independent taxation given in the 1988 Financial Statement and Budget Report and the estimates in section 5 of the press release on independent taxation. I regret that reliable estimates for detailed ranges of income above £50,000 per year are not available, as estimates are based on a projection of the 1985–86 survey

  575
  of personal incomes. All estimates are provisional and subject to considerable uncertainty. Estimates at 1988–89 levels of income are not available.

  Table 1

  Married couples with reductions in tax liability by total income of husband and wife

  Non aged

  Aged

  All

  Total income of husband and wife

  Number

  Total reduction

  Number

  Total reduction

  Number

  Total reduction

  £00

  000

  £ million

  000

  £ million

  000

  £ million

  0–5

  —

  —

  —

  —

  —

  —

  5–10

  50

  10

  400

  90

  450

  100

  10–15

  80

  190

  60

  270

  60

  15–20

  40

  —

  130

  50

  170

  50

  20–25

  30

  10

  60

  10

  90

  20

  25–30

  50

  10

  40

  20

  90

  30

  30–50

  600

  210

  60

  50

  660

  260

  50 +

  160

  100

  30

  50

  190

  150

  All

  1,010

  340

  910

  330

  1,920

  670

  Table 2

  Husbands with reductions in tax liability by total income of husband and wife

  Total income of husband and wife £'000

  Non aged

  Aged

  All

  Number

  Total reduction

  Number

  Total reductions

  Number

  Total reductions

  £000

  000

  £ million

  000

  £ million

  000

  £ million

  0–5

  —

  —

  —

  —

  —

  —

  5–10

  —

  —

  —

  —

  —

  —

  10–15

  —

  —

  60

  10

  60

  10

  15–20

  —

  —

  50

  10

  50

  10

  20–25

  —

  —

  —

  —

  —

  —

  25–30

  —

  —

  —

  —

  —

  —

  30–50

  260

  120

  10

  10

  270

  120

  50 +

  90

  50

  10

  100

  60

  All

  350

  170

  130

  30

  480

  200

  Table 3

  Wives with reductions in tax liability by total income of husband and wife

  Non aged

  Aged

  All

  Total income of husband and wife

  Number

  Total reductions

  Number

  Total reductions

  Number

  Total Reductions

  £000

  '000

  £ million

  '000

  £ million

  '000

  £ million

  0–5

  —

  —

  —

  —

  —

  —

  5–10

  50

  10

  400

  90

  450

  100

  10–15

  90

  180

  50

  270

  50

  15–20

  40

  10

  130

  40

  170

  40

  20–25

  30

  50

  10

  80

  20

  25–30

  50

  10

  40

  20

  90

  30

  30–50

  370

  90

  50

  50

  420

  140

  50 +

  90

  50

  30

  40

  120

  90

  All

  720

  170

  880

  300

  1,600

  470

  Notes:

  1. Table 2 assumes that before Independent Taxation the wife's income is the top slice of the husband's income.

  2. Estimates are given to the nearest 10,000 taxpayers or £10 million tax. Some groups in the tables have been aggregated to provide estimates and a dash is used to denote fewer than 5,000 taxpayers or less than £5 million tax.

  3. Aged taxpayers are where either the husband or the wife is aged 65 or over.

  Mr. Gordon Brown
  To ask the Chancellor of the Exchequer if he will give for 1987–88 and 1988–89 by the highest marginal rate of income tax for 1987–88 (i) the number of tax units in receipt of unearned income and (ii) to total tax levied on unearned income under the tax rates operating in 1987–88 and 1988–89.
  576
  Mr. Norman Lamont
  [holding answer 18 April 1988]Estimates of the numbers of tax-paying tax units in receipt of investment income are in the table. All estimates are uncertain because they are based on a projection of the 1985–86 survey of personal incomes. Also, the data on investment income from the Survey have been adjusted to allow for investment income not reported to tax offices, for example where basic rate liability is satisfied by
  577
  deduction of tax at source. Figures for the number of basic rate taxpayers with investment income in the table therefore provide only a guide to the order of magnitude.

  The tax liability on investment income for 1987–88 and 1988–89 is estimated at £6·2 billion and £6·3 billion respectively. The 1988–89 estimate assumes that the 1988 Budget proposals for income tax rates and allowances are implemented. In the calculation, investment income has been treated as the top slice of income and all investment income taxed as though it were received gross and subject to the individual's appropriate marginal rate of tax.

  Tax units1 in receipt of investment income2 by marginal rate of income tax

  Marginal rate of income tax Per cent.

  Number of tax units1 in 1987–88

  Number of tax units1 in 1988–893

  ('000)

  ('000)

  27

  9,500

  10,000

  40

  280

  320

  45

  265

  290

  50

  175

  215

  55

  85

  95

  60

  130

  155

  Total

  10,500

  11,000

  1 Married couples and single persons.

  2 Excluding pensions.

  3 Assuming the 1987–88 tax regime has been indexed to 1988–89.

  Central Office of Information
  Mr. Blair
  To ask the Chancellor of the Exchequer when the Central Office of Information was removed from the ministerial responsibility of the Paymaster General; and how the change was announced.

  Mr. Lawson
  [holding answer 18 May 1988]I transferred delegated ministerial authority for the COI from the Paymaster General to the Economic Secretary to the Treasury on 1 March.

  Taxation
  Mr. Gordon Brown
  To ask the Chancellor of the Exchequer if he will deposit in the Library details of the methodology used to assess rates, value added tax and other indirect taxes in his answer to the hon. Member for Dumfermline, East on 19 April, Official Report, columns 417–8.

  Mr. Norman Lamont
  [holding answer 29 April 1988]In summary the methodology is:

  (i) Average earnings for each financial year are derived from the New Earnings Survey series for "full time males on adult rates, whose pay for the survey pay-period was not affected by absence". The series for years before 1983 has to be adjusted to take account of a change in definition in that year. The series is projected from 1986–87 to 1988–89 using the assumptions provided to the Government Actuary and reported in chapter 3 of the Autumn Statement 1987.

  For each multiple of average earnings:

  (ii) Income tax liability is calculated using the personal allowances, income tax rates and thresholds for the appropriate year. The man is assumed to claim no allowances or reliefs other than the relevant basic personal allowance and, where appropriate, child tax allowances.

  (iii) National insurance contributions (NIC) are calculated using the lower earnings limit, the upper
  578
  earnings limit and, in relevant years, the limits on reduced rate NIC bands for the financial year. The NIC rates used are those for a man not contracted-out of SERPs.

  (iv) Child benefit is calculated using the rate in force for the financial year. Where the rate changes during the financial year, a financial year average s calculated, taking account of the number of weeks of the financial year for which each rate applied.

  (v) Disposable income is calculated as the sum of gross earnings and child benefit, less income tax and NIC.

  (vi) Ten per cent. of disposable income is assumed to be saved. This simplifying assumption is needed as indirect taxes are calculated by reference to expenditure, rather than disposable income (see vii). The same assumption is used for all years so that changes in indirect taxes reflect changes in the tax regime, rather than changes in savings behaviour.

  (vii) Payments of VAT, each of the Customs and Excise duties, vehicle excise duty, domestic rates and other indirect taxes including intermediate taxes such as employers' NIC are estimated using regression equations derived from the 1985 Family Expenditure Survey (FES). These relate indirect taxes paid to expenditure; they are simple linear equations with a constant term and expenditure as the independent variable.

  There are separate equations for different family types to reflect their varying expenditure patterns. Separate VAT equations are developed to reflect changes in VAT coverage since 1978–79 (two rates of VAT in 1978–79 and the extension of the VAT base from 1984–85 onwards).

  The equations are developed from the middle 80 per
  cent. of observations in the FES to avoid possible distortion caused by inclusion of extreme values. The equations cannot be used outside the range of expenditure
  from which they are developed and this restriction is implemented by only estimating indirect tax payments within the range of three quarters to one and a half times average earnings.

  The equations developed from the FES are at the prices and levels of consumption of that FES (currently 1985). They are therefore scaled backwards and forwards from
  1985 to financial years between 1978–79 and 1988–89 taking account of changes in total consumption and changes in revenue from the individual tax.

  Payments of individual indirect taxes, or groups of indirect taxes, by a particular family type at a given level of earnings are calculated by putting their spending level derived from (v) and (vi) into the appropriate equations.

  A more detailed explanation could be provided only at disproportionate cost.

ENVIRONMENT

  National Mobility Scheme
  Mr. French
  To ask the Secretary of State for the Environment if he is satisfied with the operation of the national mobility scheme; and if he will make a statement.

  Mrs. Roe
  Yes. The national mobility scheme is voluntary, but nearly all local authorities participate and I welcome the wholehearted support of the local authority associations; their representatives, together with those of other participating bodies, form the steering committee which oversees and monitors the scheme. With over 47,000 moves achieved since 1981–82, the scheme makes a valued contribution to housing mobility.

  Channel Tunnel
  Mr. Warren
  To ask the Secretary of State for the Environment what action is he taking to ensure that planning permission is withheld for development in locations where improvements to the railway infrastructure may be required for Channel tunnel traffic.

  Mr. Waldegrave
  Applications for planning permission are, in the normal course of events, dealt with by the local planning authorities, who are required to have regard to the provisions of the development plan and to any other material considerations. My right hon. Friend becomes involved only if he calls in an application for his own decision, or if the matter is referred to him on appeal.

  Proposals for the improvement of railway infrastructure would be a material consideration in deciding a planning application or appeal if they were relevant in any particular case. The weight to be given to them would depend inter alia on the likelihood that the railway proposals would be pursued.

  Council Housing (Defects)
  Mr. Corbett
  To ask the Secretary of State for the Environment whether he will give the number and type of defective properties in each of the 75 local authorities, by name, which were given additional housing investment programme resources of £20 million under housing defects legislation on 12 May; and what is the number and type of defective properties still in the ownership of each of these local authorities.

  Mrs. Roe
  This is not readily available. We are updating the information, in the House Library, on the distribution of properties designated under the housing defects legislation, broken down by local authority and property type. I shall let the hon. Gentleman know as soon as that work has been completed. Meanwhile, the House Library contains local authorities' own HIP returns for 1987, giving total numbers of designated properties in local athority and private ownerships, though these figures are not broken down by house type.

  Rating Reform
  Mr. Tony Banks
  To ask the Secretary of State for the Environment what is his Department's latest estimate for the costs to local authorities associated with(a) the setting up and (b) the administration of the poll tax.

  Mr. Howard
  These are being considered in a study being undertaken by Price Waterhouse on which I am expecting a report shortly.

  Dr. Cunningham
  To ask the Secretary of State for the Environment when he expects to receive the Price

  Command

  1 April 1983

  1 April 1984

  1 April 1985

  1 April 1986

  1 April 1987

  1 April 1988

  Building Research Establishment

  843

  791·5

  770·5

  762·5

  732

  737

  Statistical Services

  132

  132

  124·5

  121

  120

  121

  Water Topics

  90

  93

  93

  101

  106·5

  109

  580
  Waterhouse report on administering the community charge; and if he will announce the arrangements he is making to disseminate the report.

  Mr. Ridley
  I am expecting to receive the report this month and will announce arrangements for disseminating its findings when I have studied it.

  Environmental Research and Protection
  Mr. Simon Hughes
  To ask the Secretary of State for the Environment if he will give figures in real terms at 1987 prices for his Department's expenditure on environmental research and protection in total and broken down into expenditure related to (a) radioactive waste, (b) air pollution, (c) water and (d) countryside for each year since 1974 for which figures are available.

  Mr. Ridley
  The only information immediately available relates to 1985–86 and subsequent years. I shall provide information for earlier years, in so far as it is available without disproportionate effort, as soon as possible.

  Following is the information:

  £ million at 1987–88 prices

  1985–86

  1986–87

  1987–88

  Radioactive waste

  12·2

  11·4

  9·9

  Air pollution

  3·8

  4·7

  4·7

  Water

  3·6

  3·7

  3·5

  Countryside

  0·5

  0·8

  0·8

  Other environmental protection

  2·3

  2·8

  2·4

  Totals

  22·4

  23·4

  21·3

  Figures prior to 1987–88 do not include expenditure by the Industrial Air Pollution Inspectorate which became part of Her Majesty's Inspectorate of Pollution, within my Department on 1 April 1987.

  Departmental Staff
  Mr. Simon Hughes
  To ask the Secretary of State for the Environment if he will give figures for the number of staff in his Department assigned to Her Majesty's Inspectorate of Pollution since 1987 and to(a) the Building Research Establishment, (b) statistical services and (c) water topics for each year since 1983, and for the total staff of his Department for each year since 1974 for which figures are available.

  Mr. Ridley
  The number of staff assigned to Her Majesty's Inspectorate of Pollution since 1987 is 149 at 1 April 1987 and 182 at 1 April 1988.

  The numbers of staff assigned to the Building Research Establishment, statistical services and water topics for each year since 1983 are as follows:
  581
  The table shows total staff in DOE(C) for each year since 1979. The information is not readily available for earlier years.

  Department of the Environment (Central)
  Staff numbers from 1 April 1979 to 1 April 1988

  Year

  Staff in Post

  1 April 1979

  11,217

  1 April 1980

  10,530

  1 April 1981

  9,821

  582

  Year

  Staff in Post

  1 April 1982

  8,771

  1 April 1983

  7,813

  1 April 1984

  6,605

  1 April 1985

  6,561

  1 April 1986

  6,521

  1 April 1987

  6,488

  1 April 1988

  6,566

Preamble
The House met at three of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Southwark): The LORD CHANCELLOR on the Woolsack.
The 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 tomorrow I am to visit the judges and staff at Bow County Court and the Crown Court at Snaresbrook. Accordingly, as these arrangements were made before it was known that this would be a sitting day, I trust that the House will grant me leave of absence.

Royal Assent
3.1 p.m.
The Lord Chancellor: My Lords, I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified her Royal Assent to the following Acts:

Licensing Act,

Matrimonial Proceedings (Transfers) Act,

Felixstowe Dock and Railway Act.

Postal Services: Industrial Disruption
Lord Boyd-Carpenter Lord Boyd-Carpenter asked Her Majesty's Government:
How many strikes and how many other cases of industrial disruption have occurred in the postal services in the current year; and how many occurred in the same period in 1987.
The Secretary of State for Trade and Industry (Lord Young of Graffham): My Lords, disruption to postal services from industrial disputes is primarily a matter for the Post Office board and I have asked the chairman of the Post Office to write to my noble friend. However, I understand that in the first quarter of the current year, 52 strikes and 13 other disputes occurred. This compares with 26 strikes and nine other disputes in the first quarter of 1987.
Lord Boyd-Carpenter: My Lords, I thank my noble friend for that Answer and fully accept that the constitutional implications of what he said are the responsibility of the Post Office. Is it not, however, the responsibility of the Government in the event of serious disruption taking place to consider taking action on suspending the Post Office's monopoly? How quickly can this be done if necessary?
Lord Young of Graffham: My Lords, the Government always have this matter under review. It must be of concern to all that in the years 1985, 1986 and 1987 some 64,000 to 65,000 man days were lost
424
through industrial action. Only 1,300 days were lost at the beginning of the decade. I am sure the matter will be kept under constant review both by the chairman of the Post Office and by the Government. If the position continues to deteriorate we shall have to consider what to do then.
Baroness Ewart-Biggs: My Lords, is the Minister aware that the volume of letter traffic carried by the Post Office has increased by 25 per cent. over the past five years? In the light of that, does he agree with the statement made by the chairman of the Post Office Users' National Council that the substantial increase in mail volumes means that substantial investment in infrastructure and network will be needed in future years? Will the Minister say whether the Post Office tariffs have increased in relation to the retail prices index, and if so, by how much?
Lord Young of Graffham: My Lords, the Question before the House relates to industrial disputes. There can be no denying that the number of disputes has increased considerably during the course of this decade. It is also true that the Post Office has been reorganising its working practices and looking at methods both of new technology and new equipment in order to deliver the post. In terms of delivery of the post, in December 1987 88·5 per cent. of first-class post was delivered on the first working day after posting. That is not over the Post Office's target of 90 per cent.
Baroness Strange: My Lords, British Telecom is to reimburse people who for some reason or another do not have the services and facilities of a telephone. Can something be done for people who through wildcat strikes do not receive post for several days, as has happened?
Lord Young of Graffham: My Lords, in many ways wildcat strikes are hardly the responsibility of the Post Office board. The position with British Telecom is rather different. The Director General of Oftel has negotiated a very good arrangement with British Telecom which I am sure all would welcome. However, this is quite another matter.
Lord Ferrier: My Lords, can anything be done to persuade advertisers and commercial bodies to limit the amount of junk that they send, which goes straight into the waste-paper basket?
Lord Young of Graffham: My Lords, I heartily agree with my noble friend, but I suspect that it is that junk mail which keeps the Post Office going.

Government Lawyers: Recruitment
3.5 p.m.
Lord Harris of Greenwich Lord Harris of Greenwich asked Her Majesty's Government:
What steps they are taking to improve the recruitment of lawyers for government departments in England and Wales.
Lord Young of Gratffham: My Lords, lawyers' pay is being increased with effect from 1st April by around 7 per cent., and in addition allowances for those working in and around London are being improved. Performance pay is being introduced for Crown prosecutors and existing performance pay arrangements are being extended for staff at grades 5–7. These improvements reflect the special recruitment and retention difficulties facing the Government legal service. The FDA has accepted the Treasury's offer for staff at grades 5–7 and is recommending acceptance of the offer for Crown prosecutors and legal officers.
The current review of Government legal services, conducted by Sir Robert Andrew, is considering within its terms of reference the changes needed in the management of legal staff, including recruitment.
Lord Harris of Greenwich: My Lords, I thank the Minister for that Answer. Is he aware that we very much welcome the review by Sir Robert Andrew? Is he also aware that the Civil Service Commission has drawn attention in the past few weeks to the fact that both in 1986 and in 1987 the Crown Prosecution Service succeeded in recruiting fewer than half the number of people it then required? Is he further aware of the growing criticism of the Crown Prosecution Service because of this chronic understaffing? What urgent action does he intend to take to deal with this problem?
Lord Young of Graffham: My Lords, I am aware that the Crown Prosecution Service has a considerable number of unfilled posts. I am also aware that last year it recruited some 202 lawyers but at the same time received the resignations of 116. For that reason the review of Government legal services is being conducted by Sir Robert Andrew. I hope that he will report well before the end of the year and I hope that the report will suggest the right action to take.
Lord Gisborough: My Lords, is my noble friend aware that while some of us may sometimes be tempted to think there are too many lawyers, in practice there is an extreme shortage? It is extremely difficult for legal firms to find young lawyers. One of the reasons is that a great number of youngsters on coming out of law school do not practise but instead go off into industry and so on. Is there anything the Government can do either to encourage people or to restrict law school to those who are prepared to practise afterwards?
Lord Young of Graffham: My Lords, it is quite apparent that the world has changed considerably since I was a young lawyer. Nevertheless, I hope very much that the review conducted by Sir Robert Andrew will make some suggestions to help remedy the position.
Lord Mishcon: My Lords, will the Minister ensure that the Government take seriously and deal urgently with the review that is now being conducted? Is he aware that the whole of our criminal justice system depends on the adequacy of the Crown Prosecution Service and, so far as concerns the defence, on the
426
adequacy of criminal legal aid? Is he further aware that there is a crisis both in regard to the prosecution side and the defence side by virtue of the paucity of the number of lawyers available to deal with these matters? Is that not putting the substratum of our judicial system in jeopardy?
Lord Young of Graffham: My Lords, I am aware that those who work within the Crown Prosecution Service and indeed within the Serious Fraud Office receive specialist training which makes them most attractive to those outside Government who seek to recruit their services. It is a considerable problem and I hope that Sir Robert Andrew will come up with some of the answers.
Lord Morris: My Lords, can my noble friend say whether, during the course of the review, the somewhat centralised structure of the Crown Prosecution Service will be looked into and that as much as possible will be learnt from the great experience of the Procurator Fiscal's Department in Scotland?
Lord Young of Graffham: My Lords, the terms of reference of the review include changes needed for the management of legal staff, including recruitment. Therefore I have little doubt that the matter will be looked into.
Lord Bruce of Donington: My Lords, is the noble Lord aware that, irrespective of the reports that he is receiving or has received, and the reviews that may or may not have been made, it is the responsibility of government to make up their own mind as to the real reasons which lie behind the absence of satisfactory recruitment? Will the noble Lord give his personal attention to the matter because he has the reputation of producing solutions, not presenting problems?
Lord Young of Graffham: My Lords, I shall endeavour to ignore the blandishments of the noble Lord. I shall merely say that the Government seek to take advice before making up their mind and I am quite sure, having looked at the advice of Sir Robert Andrew, that they will do so.
Baroness Macleod of Borve: My Lords, in view of the many mistakes that are made by the Crown Prosecution Service, can my noble friend assure us that the standard of men and women who undertake the service will not only be maintained but improved?
Lord Young of Graffham: My Lords, I wish to assure all Members of your Lordships' House that I am certain that the standard of the Crown Prosecution Service is equal to that which would be expected for that particular process. Of course there are occasions when we are fallible and when mistakes arc made. The purpose of the review is to assess what changes are necessary in the management of legal staff, including recruitment. I am sure that that will deal with the points raised by my noble friend.
Lord Harris of Greenwich: My Lords, is the noble Lord aware that I am sure Sir Robert Andrew will be

427
overjoyed to hear that the Government propose to listen to advice in the way that the noble Lord. Lord Young of Graffham, has indicated they will'? We therefore very much hope that Sir Robert Andrew's report will be published so that we can look at his precise recommendations to find out whether the Government have acted in accordance with them.
Further, is the noble Lord aware that a recent staff survey conducted in the Crown Prosecution Service indicated that 80 per cent. of the staff said that their good faith had been stretched to breaking point because of the pressures of their workload? Is not that a most alarming situation? Does he not realise that many of us will be looking for the most urgent action after Sir Robert Andrew's report has been published?
Lord Young of Graffham: My Lords, I have been long enough in this world to be somewhat wary of such surveys. I have yet to see a survey that shows that the majority of people in any occupation feel that they have been understretched in their particular job; just as rarely as I have seen a survey showing that the majority of people consider that they have been overpaid. However, we shall look at the review and I am sure that we shall take action thereon.
Lord Harris of Greenwich: My Lords, will the noble Lord answer the question I asked: will the report be published?
Lord Young of Graffham: My Lords, I cannot undertake that we shall publish the report. However, I can undertake that we shall consider it and act upon it.

Wandsworth Prison: Conditions
3.14 p.m.
Lord Graham of Edmonton Lord Graham of Edmonton asked Her Majesty's Government:
What is their reaction to the recently published report of the board of visitors of Wandsworth prison.
The Minister of State, Home Office (Earl Ferrers): My Lords, a number of matters which were raised in the report require detailed consideration. We shall be writing to the chairman about them.
Lord Graham of Edmonton: My Lords, while I am grateful to the Minister for his reply, does he acknowledge that when the board described conditions inside Wandsworth prison as insanitary, humiliating, disgusting, degrading and inhuman, it was in fact a condemnation of government policy, especially as it was the second year that they had spoken in such terms? Given that neither the visitors, nor prison officers, nor the Government want a perpetuation of those conditions, why do the Government persist in trying to force more prisoners inside prisons like Wandsworth, thereby making conditions even worse?
Earl Ferrers: My Lords, the Government do not wish for perpetuation of such conditions. Indeed,
428
an investment of some £5 million has already been undertaken, or is planned, including total refurbishment of the kitchen and the construction of a new reception and staff mess. A pilot scheme will also begin shortly to see whether integral sanitation can be introduced in advance of general refurbishment.
Lord Mishcon: My Lords, in view of this most disturbing report, is the Minister able to tell the House when such improvements are likely to be effected'? Is he not in agreement with the theory that if people are treated like animals, they may emerge as animals'? Is not that a sign of the recidivist rates that we have to face?
Earl Ferrers: My Lords, I cannot tell the noble Lord when the alterations will be completed. However, I can tell him that the Government are most concerned about the state of prisons and that we have involved ourselves in the biggest programme of new building and refurbishment this century. Indeed, since 1978 prison building and redevelopment has been increased by 117 per cent. in real terms. Further, by the mid-1990s the estate will have been virtually doubled with an increase of 22,000 places. That is in addition to the large number of places which by that time will have been refurbished.
Baroness Masham of Ilton: My Lords, can I ask the Minister whether it is true that difficult prisoners from other prisons are sent to Wandsworth? If so, does that not make the problems even worse?
Earl Ferrers: My Lords, there are cases where difficult prisoners are sent to Wandsworth. There are of course the Rule 43 prisoners. The average number in the South-East region is 716. Sixty-seven of those are in a regional unit at Albany Prison, 57 at Grendon and approximately 400 at Wandsworth.
Lord Mishcon: My Lords, I hope that the noble Earl will forgive me if I press him on the matter. The report describes insanitary squalour and completely uncivilised conditions. Is he really saying to the House that he cannot tell us at what stage improvements to make such conditions sanitary will be completed'? Is it impossible for his department to give such a date or, at least, an approximate date?
Earl Ferrers: My Lords, no; it is not. I have already told the noble Lord that £5 million has been invested, some of which has already been spent. Various schemes are being undertaken, but I cannot tell him when they will be completed.
Lord Hunt: My Lords, can the Minister assure the House that there are no longer any young offenders aged between 17 and 21 (sentenced to youth custody) who, because of the lack of accommodation in youth custody centres, are serving their sentences in Wandsworth or any other of our local prisons in the disgraceful conditions that have been described?
Earl Ferrers: My Lords, I am afraid I cannot give the noble Lord the information he requires. However, I undertake to look into the matter and I shall write to him upon it.
Lord Harris of Greenwich: My Lords, I return to the question asked by the noble Lord, Lord Mishcon, which was specifically about the conditions at Wandsworth prison. The noble Earl has told the House that £5 million is going to be spent. He has been asked one specific question: when is the scheme going to start, and when will it finish? Surely the noble Earl has that information.
Earl Ferrers: My Lords, perhaps I did not make myself clear. I said that £5 million has been invested in this connection. Some of the work has been undertaken, or is in the process of being done; in other words, some of it has already been started. If the noble Lord requires a detailed breakdown as to how much has been started, and on what particular projects, I shall of course endeavour to find that out. However, I can only furnish him with the broad generalities.
Lord Hutchinson of Lullington: My Lords, is the Minister aware that the Chief Inspector's report on the 1986 disturbances and riots in no less than 44 institutions highlighted the impoverished state of the regime in prisons as being a precipitating factor and advocated that minimum standards should be laid down to deal with the situation? Can the Minister tell the House what steps the Government have taken, since the report was published, to lay down those minimum standards to cope with conditions which the inspector described as bordering on the intolerable.
Earl Ferrers: My Lords, I have explained that the Government are acutely concerned about the state of the prisons, which is why we have undertaken the biggest prison building programme this century. By the mid-1990s there will be 22,000 additional places, which will case the problem in the prisons. In addition, prison refurbishment is taking place. We are at one with the noble Lord in trying to improve the prisons; but he will know as well as I do that it is a difficult problem which needs a vast amount of money spent on it. It cannot be done overnight.
Lord Mishcon: My Lords, will the Minister accept that, while we are grateful for the courtesy of his replies, we are apprehensive about their lack of completeness or clarity? Will he please accept that, as I understand it, the House feels it impossible for conditions such as those described at Wandsworth to continue in a civilised country? If he cannot tell us now, will he come back at a later date and tell us when those conditions will at least be turned into civilised conditions at Wandsworth prison?
Earl Ferrers: My Lords, perhaps I may give the noble Lord, Lord Mishcon, an indication of the problem. For instance, if he wishes to see a total improvement in sanitation that would mean closing down a wing. To close down a wing merely overcrowds everyone else. As he knows, at this time
430
that is a difficult problem. We are dealing with it as best we can and as quickly as possible.
Lord Graham of Edmonton: My Lords, does the Minister accept that many people appreciate the practice started last year of publishing the reports of boards of visitors? It enables a great many more people than hitherto to know about conditions inside prisons. Bearing in mind that the Wandsworth hoard of visitors reported in similar terms last year and has seen very little happening, does he accept that that not only breeds cynicism but adds to the conditions in which industrial unrest occurs?
Earl Ferrers: My Lords, I understand the concern felt by the noble Lord, Lord Graham of Edmonton, over this problem. I am sure he will accept that in undertaking this considerable prison reform and building programme the Government are doing a great deal to improve those conditions. The noble Lord wants to see the conditions altered overnight. With the best will in the world, that cannot be done, but we are doing things as quickly as possible.
Lord Hylton: My Lords, does not the Question underline once again the vital need for the greater use of non-custodial sentences?
Earl Ferrers: My Lords, I do not believe that that is the correct conclusion. It means that here is a highly regrettable increase in crime. Much of that increase in crime results in prison sentences. Those can only be carried out properly and effectively when the prisons are in a good condition. Far the best course is for us to conduct our lives and our society so that people do not offend and therefore go to prison.
Lord Elwyn-Jones: My Lords, in the meantime, do not those prison conditions produce more criminals, and more determined criminals—those who have been through these experiences?
Earl Ferrers: My Lords, that is one of the problems that we are trying to address by increasing prison building.
Lord Hailsham of Saint Marylebone: My Lords, does my noble friend recollect that when, 30 years ago, as chief Opposition spokesman on home affairs, I drew attention to the disgusting state of our prisons, I was treated with almost universal execration by the party then in power?
Earl Ferrers: My Lords, I remember many of my noble and learned friend's utterances, but not that one. Doubtless it has embedded itself in his mind as well as those of other people.

Nuclear Disarmament: Verification
3.26 p.m.
Lord Molloy Lord Molloy asked Her Majesty's Government:
Whether they envisage discussions between NATO and the Warsaw Pact to determine principles of verification to apply to any proposals for nuclear disarmament.
The Minister of State, Foreign and Commonwealth Office (Lord Glenarthur): My Lords, no. Current discussions on nuclear disarmament are bilateral and Her Majesty's Government fully support the goal of a US/Soviet agreement to reduce strategic nuclear weapons. It is NATO's policy that any arms control agreement must have effective verification arrangements. But verification regimes must be tailored to suit each agreement.
Lord Molloy: My Lords, is the Minister saying that the INF treaty verification agreement arrived at by Mr. Shultz and Mr. Shevardnadze is only between the United States and the Soviet Union? I should have thought that it was fundamental not just to the United Kingdom but to all of NATO. Should not the Government insist that they and the rest of NATO should be involved in the verification of nuclear weapons? What role can British seismologists play in any future examination of nuclear deterrent verification?
Lord Glenarthur: My Lords, the INF agreement is bilateral. That is a fact. The details of the inspection arrangements are set out in an inspection protocol appended to the INF treaty. In addition, a basing-country agreement was signed on 11th December by the United States, the United Kingdom, the Federal Republic of Germany, Belgium, the Netherlands and Italy. When that comes into force it will establish the practical procedures and provisions necessary in order that the United States can discharge its obligations under the treaty in respect of facilities not on United States territory.
Lord Cledwyn of Penrhos: My Lords, while we welcome the resolution of the verification difficulties in relation to INF, does the Minister agree that the difficulties in relation to START are much more complex and acute? Are Her Majesty's Government confident that some progress can be made on that point when the leaders meet? Will the Minister confirm that there has been consultation with Her Majesty's Government on that and other matters?
Lord Glenarthur: My Lords, naturally Her Majesty's Government are closely associated with what develops. I am sure the noble Lord appreciates that there are complex issues to be resolved—for example, mobile missiles, SLCMs, sub-limits and all types of things—when it comes to verification. As I said earlier, we support the goal of the 50 per cent. strategic arms reduction.
Lord Kennet: My Lords, will the Minister comment on the fact that in this weeks Defence White Paper there is a passage in which the Government take modest and justified pride in the fact that they are properly associated with Soviet inspection of the removal of American weapons from this country? There is no passage describing our association with American inspection of the removal of the Soviet weapons which threaten us. Why do the Government deem it sufficient to be sure that American weapons have been removed—to most of us that does not seem to be the main danger in the world— but are not doing anything to be assured of the removal of Soviet weapons?
Lord Glenarthur: My Lords, for the simple reason that the agreement is one between the United States and the Soviet Union.
Lord Molloy: My Lords, does the Minister agree that distrust is disarmament's greatest opponent? Many NATO countries and many people in this country are alarmed because United States nuclear weapons are based in this country, not 100 miles from the House. Should we not be taken much more into consideration in any bilateral agreement involving the verification of any nuclear weapon stationed anywhere?
Lord Glenarthur: My Lords, verification is important, but, as I have said, it is important to tailor the verification arrangements to the agreement concerned. The noble Lord should be under no illusions. Soviet modernisation continues at full speed. There are longer-range missiles. They are more accurate missiles. It would be as well for the noble Lord to study those facts.
Lord Gisborough: My Lords, is my noble friend aware that I am much more alarmed at the prospect of inefficient Russian nuclear stations such as Chernobyl going off again and about the mad sputnik with a nuclear engine which is going around and which could end up anywhere than I am about weapons under American control in this country?
Lord Glenarthur: My Lords, that is an interesting view, but verification of those points may be rather difficult to achieve.
Lord Molloy: My Lords, it is terribly important. Can the Minister assure the House that he knows the difference between massive nuclear weapons and the power station at Chernobyl?
Lord Glenarthur: My Lords, of course.

Business
3.30 p.m.
Lord Denham: My Lords, it may be for the convenience of the House if I announce that the Committee stage of the Education Reform Bill will be adjourned at approximately 7 p.m. for approximately one hour and that during this adjournment the Control of Misleading Advertisements Regulations 1988 and the Second Reading of the Malicious Communications Bill will be taken.
I should also like to say a word about this afternoon's business. As your Lordships are aware, the House will sit tomorrow at 11 a.m. In the circumstances, the House would normally wish to rise tonight by 11 p.m. While I do not wish to constrict in any way the proper consideration of the House, I know that noble Lords will bear this in mind in judging the length of the contributions to the debate on this, our final day in Committee on the Education Reform Bill.

British Steel Bill
Brought from the Commons; read a first time, and to be printed.

Education Reform Bill
3.31 p.m.
The Parliamentary Under-Secretary of State, Department of Education and Science (Baroness Hooper): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Baroness Hooper.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD ABERDARE in the Chair.]
Clause 168 agreed to.
Baroness Warnock Baroness Warnock moved Amendment No. 274A:
Before Clause 169, insert the following new clause:
("Statements of special educational needs.
. In section 7 of the 1981 Act (which imposes duties on local education authorities in relation to statements of special educational needs) and section 8 of the same Act (which sets out arrangements for appeals)—

(a) in subsection (2) and subsection (9)(b) of section 7 the words 'special educational' shall be omitted:

(b) in subsections (1), (4)(a), (6)(a), (7)(a) and (7)(b) of section 8, the words 'special educational' shall be omitted.").

The noble Baroness said: This amendment may seem to sit rather uneasily among those that have been considered so far, since it is in effect an amendment to the Education Act 1981. Its purpose is to ensure that when a child gets a statement of special needs, the local education authority has a duty and has the powers to make provision for all the child's needs according to the statement.
Local education authorities vary very much between themselves as to the number of statements they make and the degree to which they make provision under them. But part of the difficulty of provision lies in the 1981 Act itself and could be remedied comparatively easily. Now seems a very good opportunity to put this right. I shall explain the present position as briefly as possible.
Section 7(2) of the Act provides that where a local education authority maintains a statement:
"it shall be the duty of the authority to arrange that the special educational provision specified in the statement is made for him unless his parent has made suitable arrangements".
However, a recent judgment, the Oxfordshire judgment of 1986, has ruled that speech and other therapies count not as educational provision but as health provision. Thus an education authority has a limited duty to provide such so-called therapies. Moreover—and this is an important point—by the same judgment it was found that local education authorities do not have the power to provide or pay for such therapies if the health authorities fail to provide them.
The situation is particularly acute in the case of speech therapy with which specifically the
434
Oxfordshire judgment was concerned. There is simply no logical reason to separate speech therapy from other aspects of education. The title "speech therapy" is extraordinarily misleading. Speech therapists may be partly concerned with physiological problems of word and voice production, but much more fundmentally, they are concerned with language. They have to teach people to be articulate in every sense of the word. To regard their task as more properly medical than educational is a complete misunderstanding based on an outmoded distinction between education, supposedly concerned with thought and language, and health, supposedly directed towards the purely physiological. But in reality speech and language go together. For children without speech, or with only very rudimentary speech, education is totally impossible. The tool of articulate language must be given to these children to use before their education can properly begin and while it is continuing.
Since speech therapy has traditionally been provided by health services, it is essential that local authorities should be able to provide speech therapy and physiotherapy and any other therapies as well, where this is an essential and continuing power and a prerequisite of the child's education. Collaboration between health authorities and education authorities is always very difficult, but nevertheless it is nearly always essential to the education of a child with physical, sensory or mental handicaps.
The purpose of this amendment is to make such cross-over provision possible. It is timely to make this change when many local education authorities are reconsidering their provision for children with special needs and when all the London boroughs will be taking over education once again.
It would be extremely satisfactory if Ministers who have claimed to have the interests of the least able and the disadvantaged at heart could accept this practical improvement on the 1981 Act at this stage, thus bringing to an end considerable suffering and a great deal of frustration for a very large number of children up and down the country. I beg to move.
Baroness Darcy (de Knayth): I should like to support my noble friend Lady Warnock. I do not think we could have a more appropriate person to move this amendment to close the loophole in the 1981 Act. The situation, as she says, is confused and needs clarifying. Some local education authorities such as Berkshire, Somerset and St. Helens have brought in speech therapy but they are not clear as to what the legal position is.
I echo what my noble friend said about the nature of speech therapy. It is an essential element to give access to the curriculum, but it is also an on-going and vital component of a child's education and development. Some children end up going to residential special boarding schools in order to obtain speech therapy, which is an extra expense, and the boarding provision may not be what the parents wanted for their children.
Equally there are cases of children being sent to special day schools even though their statements of special needs say that the most suitable provision

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would be for mainstream education with a speech therapy input. So I hope that the Minister will look kindly on this amendment which could transform the educational prospects and indeed the lives of children with special educational needs by enabling them to be met as the 1981 Act intended.
Lord Renton: Althought the noble Baronesses have undoubtedly drawn attention to the difficulty with regard to speech therapists and others—a difficulty which ought to be overcome in some way or another—with respect to them, I do not consider that this amendment would be a good solution to the problem. I find it somewhat ironic that the noble Baroness, Lady Warnock, should be moving it, because the 1981 Act which she seeks to amend so radically is based upon the Warnock Report, for which we were all so grateful at the time.
The expression "special educational" attached to the word "needs"—"special educational needs" is the phrase that we have in mind—has become not only a term of art in our statute law and in the administration which has followed from it; it has become a working formula for all people involved in education and in providing services for people who have various handicaps. Also it is something well understood by those working all over the country in voluntary societies like MENCAP who try to help people suffering from various handicaps. Having checked these amendments against the 1981 Act which they seek to amend—it is one amendment but it contains two textual amendments—I fear that the result of removing the concept of special education would cause doubt and confusion. Some other way of dealing with this matter should be found.
Lord Campbell of Alloway: I support the spirit of the amendment. It raises an extremely important point where the state of the law is wholly unsatisfactory. I declare an interest having been counsel in a recent case in the Court of Appeal in which the Oxfordshire decision was challenged.
It is right to say that in that case by virtue of undertakings given under the pressure of the members of the Court of Appeal the DHSS and the LEA agreed together to provide the speech therapy. As that provision was adequate and as it was a legally aided case, my client got what was required and the case was discontinued. The impression that I and all of us at the Bar obtained was that the Court of Appeal would not have upheld the Oxfordshire judgment. But the matter, as has been said, is extremely important. It requires totally objective and in a sense leisurely consideration.
There was no reference to speech therapy in the Act of 1944—the principal Act—or in the implementing regulations. But by judicial decision—again, this was a case with which I was concerned—it was held in the case of Chance that speech therapy was a requisite statutory provision where a child could not benefit from education without it and that there was a duty to provide it. It is open to serious doubt whether the case of Chance was cited to the court which came to the conclusion in the Oxfordshire case although it must be said that it came to that conclusion on slightly different statutory provisions. It is also
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doubtful whether it could ever truly be said that speech therapy under the 1981 Act would not be a special educational provision in circumstances where the child simply cannot benefit from normal education without it.
The statement under Section 7(1) presupposes special educational provision which could well include speech therapy. The statutory duty to provide comes under Section 7(2). There is no need, strictly speaking, with the greatest of respect to my noble friend Lord Renton, to repeat the words "special educational" because that is inherent in the formation of Section 7(1) and (2).
But the reason why it could be relevant to accept this amendment is to close a very serious gap in the implementation of these provisions between various local authorities. That applies in particular to speech therapy; there is total disparity of treatment. Somerset, for example, regards itself as under a statutory obligation to provide speech therapy for pupils who cannot receive normal education benefit without it. Oxfordshire takes precisely the opposite view.
This is not an easy problem. I respectfully agree with my noble friend Lord Renton in questioning whether the amendment seizes the fundamental issue and whether it resolves it. The fundamental issue is simple to state. But, like most fundamental issues, it is not so easy to resolve. There is a terrible shortage of speech therapists. Their pay and conditions are settled by the DHSS. And they are employed by the DHSS. But the DHSS is under no statutory obligation whatever to provide their services to meet statutory requirements under the Act of 1981 or any other statute in the context to which I have referred. This aspect is fundamental and I would respectfully suggest warrants attention.
The obligation upon the local authority to pay the DHSS for the services of the speech therapists also warrants attention, as does the obligation upon the LEA as implemented by Somerset among others to provide speech therapists in each of its schools. That should be incorporated in a statute.
I support the spirit of the amendment and thank the noble Baroness for having moved it. I hope that my noble friend the Minister takes on board the broader spectrum of the problem which I have sought to explain. If that could be done my hope is that the Committee would not have to divide on the amendment but instead wait to hear what constructive proposals my noble friend the Minister might be able to produce on Report.
3.45 p.m.
Baroness David: My name is also down to this amendment and I should like to support it. I think everyone would agree that there is a problem. It may be, as the noble Lord, Lord Renton, said, that this amendment is not the best way of dealing with it. I hope however that the Minister will agree that there is a problem and that it should be solved. I hope that if she is not satisfied with this amendment she will at least take it away and come back with her own proposals on Report.
The Earl of Swinton: I go along with what has been suggested by my noble friend Lord Campbell of Alloway and by the noble Baroness, Lady David. There is obviously a difficulty here. As I understand it some local authorities may well be breaking the law at the moment by providing speech therapists. There has been no mention today of physiotherapists, who are also involved, or of occupational therapists.
Even had my noble friend Lord Renton not pointed out the technical difficulties of this amendment, I could not have supported it as it imposes a duty on local authorities. I should like my noble friend the Minister to look at the possibility of inserting the word "might" instead of the word "shall" at some stage into the Act so that local authorities providing this facility can continue to do so. Those who would like to but feel that they would be breaking the law if they did would be encouraged while those authorities not providing this facility would see that their neighbours were and, following good practice, might do so themselves. I hope that my noble friend the Minister who has been so good at looking at so many of these problems of special needs will also consider this one.
Baroness Masham of Ilton: I too wish to support the spirit of the amendment. I wish to inform the Minister that recently at a Save the Children meeting I spoke with a professor from Manchester University who studies the special needs of children. When we were discussing the matter of therapists in schools he said that there was a great problem of lack of speech therapists and physiotherapists which we all know about. He said that it was important that their skills should be passed on to care attendants and to parents who could then help with the repetitive work which speech therapy entails. Teaching such children is a long process and some care attendants are very good at it. They are employed by local education authorities. Therefore it is sensible to bring such services together and make them more flexible so that they can be provided by the local education authorities and perhaps by the health authorities, if that is thought necessary.
Perhaps I may also mention the problems of the physically disabled people who have growing spines and limbs. They sometimes sit for long hours at desks. It is easy for the physically disabled to get into bad habits of posture. With children, bad posture can deform limbs. It takes a long time to undo the results.
Just before Christmas I went to give the prizes at a comprehensive school in Ware. There were eight severely handicapped children in a mainstream school. I asked whether the children were having physiotherapy. The headmaster said that they were not. The problem is very serious and we must make an investment in the future by protecting children. I hope that the Minister will listen to the many people who understand and know about such problems. We have been told by the noble Lord, Lord Young, that the Government listen. I hope that the Minister will also listen today.
Lord Parry: Perhaps I may be allowed to underline what has been said. As regards services provided to the handicapped in schools it is essential that it is seen
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to be the duty of the local authority to provide them. Furthermore, as changes take place, which are largely welcomed by people working in the field, to reassimilate people into the mainstream of education, those services should be kept up and made available. I associate myself most strongly with the amendment.
Lord Hylton: I am old enough to recall the 1969 Act, which I believe was an education Act, which transferred responsibility for special schools from social service departments and the DHSS to education authorities and therefore to the ministry of the noble Baroness.
Lord Renton: Perhaps I may intervene briefly. It was not 1969. It was when the present Prime Minister was Secretary of State for Education. I believe that that was 1972 or 1973.
Lord Hylton: I stand corrected. However, the point is the same. A similar administrative change was very successful in that context. I hope that an administrative change will produce an improvement in the situation which we are discussing.
Lady Kinloss: I support the amendment. It seems from the arguments that have been put forward that it is trying to ensure that children who are already disadvantaged do not fall between two stools—the local authorities and the health authorities. Surely the legal muddle should be sorted out now while we have the Education Reform Bill before us.
Baroness Hooper: I have listened with interest to the debate and the views which have been expressed. I should like to make clear to the Committee both the aims of the amendment and its impact. The aim has been stated with fervour and sincere feeling by the proposers of the amendment. It is to ensure that non-education provision in the statement of special educational needs has the same status as educational provision. Non-educational provision includes not only speech therapy, occupational therapy and physiotherapy, but also other services provided by district health authorities, social services departments and voluntary organisations. These services may include equipment, care, respite care and counselling. As a consequence of the amendment, LEAs would be under a duty to make all such non-educational provision or to be answerable to parents through appeal committees if they failed to do so. The impact of the amendment would therefore be to place LEAs under a duty to make non-educational provision which it is not their province to provide.
I note the suggestion made by my noble friend Lord Swinton, when he said that the provision should be permissive rather than obligatory. I shall look at the implications of that suggestion. However, just as the amendment goes beyond educational powers, so it goes beyond what education Ministers and education law can deliver, and for good reasons.
The provision of speech and other therapies in schools are component parts of the School Health Service. I must correct both noble Lords when I say that responsibility for that service passed from the

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DES to the DHSS in 1974. Parliament thought then that it was best that provision of all health services, including services to children, should be centralised. That remains the Government's view. Certainly the introduction of new procedures under the 1981 Education Act has identified an increased need for some services, particularly speech therapy, that health authorities are not always immediately able to provide.
But today we are concerned about children. We must remember that we do not have infinite resources; nor do we have an infinite supply of trained practitioners, as my noble friend Lord Campbell said. Let us be very clear about one thing. Were we to say that children with special educational needs in need of such treatment should have first call on all such services, we would be denying access to stroke victims, to accident cases and to many other people with good medical reasons for requiring such provision.
Having said that, I must point out that since 1979 the numbers of speech therapists and physiotherapists employed in the NHS have risen by 66 per cent. and 35 per cent. respectively. That is not a record of a government who are complacent about demand for these services. The Government and the DHSS have given a high priority to meeting this need. However, needs, demand and expectations continue to rise in this area.
The Government recognise the problem. We have listened to the arguments. My right honourable friend is fully aware of the importance of speech and other therapies to certain children with special educational needs. In asking the Committee to reject the amendment, I do so not because its objective is ill-founded but because in law the terms of the amendment simply cannot achieve that objective.
Baroness Young: Before my noble friend sits down, perhaps she can clarify one point. A gap appears to have been identified between the DHSS and the Department of Education and Science. We are all agreed that the amendment on the Marshalled List is not correctly drafted. However, my noble friend Lord Swinton made a suggestion and the Minister has agreed to look at it. I believe that it will meet the needs of the Committee if the Minister agrees to look at it positively and perhaps brings back an amendment at a later stage of the Bill.
Baroness Hooper: I can give that assurance. In fact in doing that I believe that we shall perhaps be in the position we thought we were in before the Oxfordshire judgment.
Lord Campbell of Alloway: Perhaps my noble friend will take on board and bring into the statute the simple concept that in an appropriate case on the facts speech therapy is an educational provision. In other words, we should set aside by statute what I believe the Court of Appeal would have done if it had proceeded on the basis of the Oxfordshire judgment. We should get the matter straight by statutory means. That would not bind the authority, other than to say that in an appropriate case on the facts if a child cannot benefit from education without speech
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therapy, then speech therapy is a special educational need and there is a statutory obligation on the local authority to provide it under Section 7(2) of the Act. We must make that plain.
Baroness Hooper: It is a little difficult for me to give a firm commitment on that point at this stage but obviously I shall look into the matter.
Baroness Warnock: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 169 [Education Assets Board]:
4 p.m.
Baroness Hooper Baroness Hooper moved Amendment No. 274ZZA:
Page 156, line 15, at end insert—
("(6A) Any local education authority shall give the Board such information as the Board may require for the purposes of the exercise of any of their functions under this Act.").
The noble Baroness said: This is an essential amendment to ensure that the Education Assets Board is fully able to carry out the functions prescribed by the Bill. While we are confident the local authorities will co-operate with the board in identifying the property, rights and liabilities to transfer by virtue of the Bill to the new higher education corporations and grant-maintained schools, we must ensure that it has a right to obtain from local authorities whatever information it judges necessary to complete its task. I trust, therefore, that the Committee will agree to this amendment.
On Question, amendment agreed to.
Clause 169, as amended, agreed to.
Before Schedule 6:
[Amendment No. 274ZZB not moved.]
Schedule 6 [The Funding Councils and the Assets Board]:
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 274AA:
Page 189, leave out line 35 and insert—
("(a) to acquire land and other property, and subject always to the terms and conditions on which such land and other property is held, whether heritably, on trust or otherwise, to dispose of the same.").
The noble Lord said: This is the first of a number of amendments which appear on today's Marshalled List which have been suggested by the Church of Scotland. The amendment deletes paragraph (a) which reads:
"to acquire and dispose of land and other property".
and substitutes the words printed on the Marshalled List.
The position is somewhat difficult because consideration of Schedule 6 comes before the discussion of Clauses 173 and 174. There is a particular problem in Edinburgh University where the faculty of divinity operates in New College which is owned by the university under a deed which provides that if the property ceases to be used as a

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faculty of divinity or if the faculty of divinity provides teaching which is not in accordance with the faith and doctrines of the Church of Scotland the property reverts to the Church of Scotland and is taken away from the university.
It is to deal with that type of situation—which may well occur elsewhere than at Edinburgh University—that this amendment is suggested. It would allow land and property which is bequeathed or transferred to universities under specified conditions to be dealt with taking account of those conditions. I commend the amendment to the Committee.
The Lord Chancellor: In moving the amendment the noble Lord, Lord Morton of Shuna, illustrated at least one difficulty which may arise in defining the idea of academic freedom in the faculty of divinity in the University of Edinburgh. However, that is not the main purpose of the amendment.
The amendment relates to Schedule 6 which describes the powers, not of the university, but of the funding council. Accordingly the problem to which the noble Lord has directed attention is one of land belonging to Edinburgh University. It is not a question of land which will belong to the funding council.
Perhaps I should make it clear in case there is any misunderstanding that there is no suggestion that the Universities Funding Council will own the land belonging to the universities. The council may need land for itself because it may need a small office or accommodation of that kind, but there is no question of the Universities Funding Council taking over the estates of the universities and colleges. Therefore there is no question of the land presently occupied by the faculty of divinity of the University of Edinburgh ever coming under the powers of the funding council laid down in this provision.
The university will continue to be bound by the terms of the trust under which it holds the land. In the event of any of the events occurring to which the noble Lord referred the land would revert to the Church of Scotland.
While I appreciate the problem, I do not think that it is a problem which arises within the terms of this particular schedule or indeed the terms of the Bill.
Lord Morton of Shuna: I am obliged to the noble and learned Lord for what he has said. I shall withdraw the amendment and consider what he has said in more detail and perhaps obtain some advice. There are difficulties in the Bill itself in relation to this kind of problem which arise under Clause 174 which we shall come to later. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 274AB:
Page 189, line 46, at end insert—
("( ) The chief officer of the Corporation shall be appointed as such by the Secretary of State and shall hold and vacate office in accordance with the terms of his appointment.").
The noble Lord said: This amendment is grouped with Amendments Nos. 274AC and 274AD. The amendments relate to the appointment of the chief officer of the corporation. The idea behind these three amendments is that, rather than having the situation as described in the schedule whereby the first chief officer shall be appointed by the Secretary of State and each subsequent chief officer shall be appointed by the corporation with the approval of the Secretary of State, each chief officer shall be appointed by the Secretary of State, no doubt after consultation. This is a fairly simple trio of amendments but that would appear to be a more straightforward way of dealing with the situation. I beg to move.
Baroness Hooper: Schedule 6 sets out the details of the structure and operation of the two funding councils for higher education and the Education Assets Board. For simplicity we have drawn together the common factors in each case into one schedule to govern all three corporations.
I recognise the arguments of the noble Lord, Lord Morton, in favour of simplicity. However, it may be best for me to explain our thinking on the position of the chief officer by referring to the Universities Funding Council. This is because this part of the structure for the three corporations arose out of the review of the University Grants Committee carried out by a committee under the chairmanship of the noble Lord, Lord Croham.
The Croham report recommended that the chief officer (referred to in the report as the director general) should be a member of the council and should be appointed by the council with the Secretary of State's approval. It further recommended that the first chief officer should be appointed directly by the Secretary of State. The Government announced in the consultation paper on the UFC published last May that they intended to accept those recommendations. Those are precisely the provisions which appear in paragraph 3 of Schedule 6.
It is easy to understand that the first appointment has to be made by the Secretary of State. The councils have to be set up in shadow form, before their incorporation, as important work has to be started. Consequently a chief executive designate is needed, often before the group of people who will eventually become the council members have been brought together. But beyond that it is important that subsequent appointments should enjoy the confidence of the corporation.
However, it is also important that the appointment should enjoy the confidence of the Secretary of State. The chief officer will be the accounting officer of the corporation, responsible for the money that Parliament has voted for it at the Secretary of State's behest.
We believe that the Croham recommendations concerning the chief officer achieved a suitable balance, and we consequently adopted the same model for the PCFC and the EAB.
The noble Lord's amendment would have the Secretary of State alone appointing the chief officer. But we believe that it is important for the council also to take an active part in the decision. I believe that

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our provision requiring the Secretary of State and the corporation to agree on the appointment is the correct one. I do not think that it would be right for the Secretary of State to make the appointment in isolation and I hope that the noble Lord will withdraw his amendment.
Lord Morton of Shuna: I was not suggesting that he should do it in isolation; I was suggesting that he should do it after consultation. However, it is not a very important matter and I do not wish to delay the Committee. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 274AC and 274AD not moved.]
Baroness Darcy (de Knayth)Baroness Darcy (de Knayth) moved Amendment No. 274ADA:
Page 190, leave out line 28.
The noble Baroness said: I beg to move.
The Earl of Arran: We have already explained that the Government agree with the points made by the noble Baroness in these and her other similar amendments. We are therefore happy to accept both her
amendments.
On Question, amendment agreed to.
Baroness Darcy (de Knayth)Baroness Darcy (de Knayth) moved Amendment No. 274ADB:
Page 190, line 29, leave out ("otherwise").
On Question, amendment agreed to.
The Earl of Arran The Earl of Arran moved Amendment No. 274ADC:
Page 190, line 35, leave out from ("may") to end of line and insert ("determine; and
(b) shall pay, or make such payments towards the provision of, such pension to or in respect of any member of the Corporation as the Secretary of State may determine.
(2) If a person ceases to be a member of the Corporation and it appears to the Secretary of State that there are special circumstances which make it right that he should receive compensation, the Secretary of State may direct the Corporation to make to that person a payment of such amount as the Secretary of State may determine.
(3) A determination or direction of the Secretary of State under sub-paragraph (1) or (2) above requires the approval of the Treasury.").
The noble Earl said: In moving Amendment No. 274ADC I should also like to speak to Amendment No. 274ADD. These are well precedented technical amendments relating to the terms and conditions of service of members of the UFC, PCFC and EAB. These contingency provisions supplement those already in the Bill relating to these bodies' employees. I commend them to the Committee and I beg to move.
On Question, amendment agreed to.
The Earl of Arran The Earl of Arran moved Amendment No. 274ADD:
Page 191, line 14, at end insert—
("(6) The Corporation shall pay to the Treasury, at such times as the Treasury may direct, such sums as the Treasury may determine in respect of the increase attributable to sub-paragraph (5) above in the sums payable out of money provided by Parliament under that Act.
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(7) Where an employee of the Corporation is, by reference to that employment, a participant in a scheme under section 1 of that Act and is also a member of the Corporation the Treasury may determine that his service as such a member shall be treated for the purposes of the scheme as service as an employee of the Corporation (whether or not any benefits are payable to or in respect of him by virtue of paragraph 6 above).").
On Question, amendment agreed to.
[Amendment No. 274AF not moved.]
Schedule 6, as amended, agreed to.
Clauses Nos. 170 to 172 agreed to.
4.15 p.m.
Clause 173 [The University Commissioners]:
Lord Jenkins of Hillhead Lord Jenkins of Hillhead moved Amendment No. 274AF:
Page 159, line 10, after ("exercise") insert ("in accordance with subsection (2) below").
The noble Lord said: In moving this amendment, I believe that, for the convenience of the Committee, we can also unlock the discussion on Amendments Nos. 274BA, 275, 275A, 276, 277, 279B and 280.
I am glad to mention that those amendments will be discussed with Amendment No. 274AF because my noble friend Lady Seear and I claim no exclusivity of wisdom for the words that we have chosen in our amendment. Indeed they were not originally ours but were taken from a speech made by the Secretary of State for Education and Science to the Vice Chancellors on 30th October last year. We hoped that that would make them acceptable to the Government. However, if it is argued that one of the other amendments would do the job equally well and more neatly I shall be quite content. I have no pride of authorship; merely a desire to see the result achieved.
However, the job must be done and it must be done in statutory form. Words in Hansard are no substitute for sections and subsections of an Act of Parliament. I hope that the noble and learned Lord the Lord Chancellor will not try to suggest otherwise.
That such a declaration would be desirable I hope is not in dispute. It arises both from appearance and reality. The noble Lord, Lord Blake, in the debate on Second Reading, spoke with great authority and persuasiveness about the importance of reassuring the academic community, whose morale, he said, was badly shaken. He used the words "depression" and "resentment", which were strong words coming from the noble Lord who speaks with habitual restraint. But it is not just a question of the need for psychological balm. The abolition of tenure leaves a dangerous hole which needs to be plugged.
Broadly speaking, it is true to say that university opinion has not strongly resisted that abolition. I believe the restraint has sprung from a desire not to be too concerned with material self-interest and with claiming for university teachers financial and job security not enjoyed by most other sections of the community. It may be that this self-abnegation has been carried too far for two reasons. First, there will be most undesirable anomalies between those who move to new jobs without protection and those who stay in old ones with protection. There is far more of

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a promotion trap here than anything arising out of the banding amendment to the poll tax Bill about which the Government have been so concerned. Secondly, there is some mounting evidence that the new arrangement will militate against foreigners, particularly Americans, accepting British university appointments. If that proves to be the case, cross-fertilisation (which is desirable) will turn increasingly into a one-way brain drain (which would be highly undesirable).
In any event, it looks as though tenure will go and that there will be certain inevitable and undesirable consequences. But surely it cannot be intended that academic freedom should be imperilled with it in a kind of sidewind. That would be a remarkable example of throwing the baby out with the bath water. The issue of academic freedom therefore becomes a major test of the Government's intentions. I cannot believe that, if the good intention is there, satisfactory words cannot be found. There are many precedents: Article 10 of the European Potocol; the Government's own previous Bill to protect free speech on university campuses; the use of the words "justice" and "freedom" rather freely elsewhere in this Bill; the Canadian experience (to which attention was drawn in a powerful letter in The Times earlier this week).
I therefore strongly urge the noble and learned Lord the Lord Chancellor, in whose authority, goodwill and intellectual sympathy we place great hope, either to accept one of the amendments on the Marshalled List or to indicate quite clearly that he has an equally effective one of his own in preparation which he will bring forward at Report stage. I beg to move.
Lord Morton of Shuna: This group of amendments includes Amendment No. 275A in my name and those of the noble Lord, Lord Grimond, and the noble Earl, Lord Russell. It is an amendment seeking to add the words:
"to promote the University as a free and independent community of scholars in a wide range of subjects".
The whole issue of academic freedom, as we have heard from the noble Lord, Lord Jenkins, raises the issue of tenure. However I do not wish to deal with that matter because I have no real connection with universities. I wish to speak about another aspect which is more important to me, and I think to a large section of society; namely, academic freedom—the provision of a community of scholars who are free and independent to investigate and teach a wide range of subjects. I suggest that this is a matter of vital importance to the development and existence of freedom of expression in the country generally. We must encourage this to grow and not restrain it in any way. We must retain places where the development of ideas is positively encouraged even if the particular ideas may be temporarily unpopular or unexpected.
In my profession, practising the law, it is quite obvious that those of us in practice do not have the time, and may have the inclination driven out of us, to think out new ideas. We have become constrained in our habits of fitting the existing law to the needs of clients and do not have the time or inclination to look
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at wide-ranging new ideas on how the law may be reformed. For such ideas we look to the academic lawyer. It is that approach that we must encourage in all the various sciences.
Of course it is important that there should be freedom of speech. On this side of the Chamber we are wholly in favour of freedom of speech. This entails that anyone, however unpopular, must be protected and allowed to address meetings, even in universities. Recent legislation has provided, apparently successfully, for that. We take the view very strongly that even if somebody is propounding an unpopular idea—if someone like M. Le Pen were to come to adddress a university or other institution because he was asked to do so—it is his right to do so. It is the right and duty of other people to listen to him and that right must be protected. We would therefore wholly dissociate ourselves from any idea of preventing such freedom of speech. We regard that approach as wrongheaded because silly ideas are best met and countered by listening to them and demolishing them in argument. Therefore we would be wholly in favour of freedom of speech, and we hope that this debate will not be sullied by references to previous occasions where there has been trouble at universities, as of course there has been trouble on occasions elsewhere.
Lord Thomas of Swynnerton: I should like to draw attention to Amendments Nos. 275 and 276 which stand in my name and those of my noble friend Lord Blake, the noble Lord, Lord Adrian, and the noble Earl, Lord Halsbury. The form of words which we have put forward derives from the speech of my noble friend Lord Blake on the Second Reading of this Bill to which the noble Lord, Lord Jenkins of Hillhead, has already drawn attention. My noble friend unfortunately is at the moment in West Canada lecturing to branches of the Sir Winston Churchill Society. Otherwise he would be here today to support this amendment to which he has his name.
I do not disagree with anything that has been said about these amendments or believe that any of them has a superiority to the others, although I think that ours is more pithy than the others. The aim of the amendments essentially is to establish, as I see it, that when tenure is abolished and the academic world has its employments on the same terms as the rest of the community—actions with which I am in general sympathy—academic freedom should be guaranteed.
With regard to "academic freedom" those of us who put forward these amendments are thinking in terms, for example, of freedom of study, thought and expression, both in public and in private, and freedom of publication. In practical terms this would mean that in the statutes of every university there would be a statement to which an aggrieved academic could if necessary turn if he thought his dismissal was due to considerations of his work, what he had said or what he was teaching rather than to disorderly conduct or negligence or because the university had run out of money.
My noble and learned friend the Lord Chancellor in his eloquent speech at Second Reading implied that he thought an amendment along these lines was not necessary on the ground that the aim was covered

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by the inclusion of the words "justice and fairness". My noble friend Lord Blake hinted that he thought in most cases that would be so. That is something to bear in mind. On the other hand, those words are very general and it is important for the Committee to realise that the universities have made known that they want a clause of this kind introduced into the Bill, and want it very strongly. I am sure that the Government in general share the opinion, as I do, that these institutions are sufficiently important, and make a substantial enough contribution to the national life, that if they want something strongly they should have it unless there are very good reasons why they should not. I cannot believe that the difficulty of defining academic freedom can represent a very good reason.
As the noble Lord, Lord Jenkins of Hillhead, reminded us, other countries have formulated these definitions. If the Department of Education and Science does not have adequate legal advice on this question I have no doubt whatever that many universities can give effective advice.
However, there is another reason why we should think about these amendments very seriously. As my noble friend Lord Blake said in his speech on Second Reading, there is no doubt that relations between the Government and universities are not good. I do not agree with the noble Earl, Lord Russell, in his fine, uncontroversial maiden speech at Second Reading that these matters are entirely the fault of the Government. In any good quarrel—and this is one—both sides have some responsibilities. I have no doubt whatever that universities, for example, have underestimated the outrage which has been widely caused by their apparent inability to guarantee freedom of expression to visiting speakers such as my noble friend Lord Joseph or others on other occasions. The noble Lord, Lord Morton of Shuna, mentioned this. It is a very important point. It is one reason why universities have suffered in the public estimation. I dare say that we could all think of other ways in which they have contributed at least to these bad feelings.
At the same time, any fair-minded person—and the Government are full of fair-minded persons, as we in this Chamber know very well—would recognize that there are some things which the Government have done in relation to universities which have exacerbated bad relations. In many ways the very inclusion of these university clauses at the tail end of a long Bill dealing primarily with education in schools must seem rather a humiliation to universities. After all, universities do many things other than educate, and even if they dealt only with education they are large enough institutions to deserve a Bill of their own if it were thought necessary.
This is not the occasion to make a speech which might have been better made on Second Reading. It is obvious that the background of bad relations is something that the Government will want to bear in mind when considering how to implicate these proposed amendments in the Bill.
I do not know whether the Government can afford to be permanently on bad terms with the universities.
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I suppose that probably in the abstract they could, but they must want to be on good terms with the universities. I can think of no better way of showing that desire than by accepting an amendment such as my noble friends and I have put down which would certainly be very much in the spirit of the paragraph in the Croham Committee's report, where it reminded us that the autonomy of universities and government funding are two separate principles whose co-existence must make for compromise. If they accept one of these amendments in the terms I suggest, I have no doubt that they will also be going a long way towards restoring between the Government and the universities that state of harmony and affection—I am quoting from Thomas Jefferson's inaugural address—
"without which life and indeed liberty itself are but dreary things".
4.30 p.m.
Lord Hatch of Lusby: I speak on this issue with personal experience. In 1953 the head of my department at Glasgow University found a clause which nobody else in the university knew about and which enabled him to terminate my contract after five years, when it was believed that all members of the senior staff had tenure. I was lucky. The vice-chancellor of that time was a very great man, Sir Hector Hetherington. He saw what was happening and set up a university commission of which he himself was chairman. Within a few weeks I was offered my post back. I did not take it, but I was offered it. This was solely on the grounds that the head of my department did not like some of the activities in which I had been engaging. I have no doubt that many noble Lords dislike many of the activities in which I engage, but that, with one exception, has never led them to try to silence me.
If I had been less lucky than having that very fine vice-chancellor as an employee of the university I would have lost my post. I believe with the noble Lord, Lord Jenkins of Hillhead, that this is the central issue of academic freedom. The Government have made some concessions to their relationship with the individual academic, but they are not sufficient because as the Bill reads the academic is not protected against his employer. Unless he is protected against his employer we cannot claim that the academics of this country have academic freedom.
I wish to quote from a speech made by the noble Baroness, Lady Hooper, in November last year in this Chamber when she said that the Government took the view that academic staff should have freedom within the law to question and test received wisdom and to put forward new ideas and controversial or unpopular opinions without placing themselves in jeopardy of losing their jobs or the privileges that they may have at their institutions. She went on later to say that the Government recognised the relevance of academic freedom to the legislation that they would be bringing forward shortly to modify the tenure of academic staff; the relevant provisions would be framed so as to take the issue into account. I simply suggest to the noble Baroness that this is precisely what she is being given the opportunity to do this afternoon, by putting provisions into the Bill to safeguard the individual

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rights of academics not against the Government solely but against the dangers that can arise and sometimes do arise from the employers and the institutions themselves.
I suggest that it is important that when the Bill is passed the commissioners are given directions that whenever they alter the statutes, the charters or in some cases the law they should be vigilant in safeguarding the principles of academic freedom for the individual. That is the kernel of academic freedom.
I beg the Government to put their own words into practice by accepting one of these amendments to protect the right of the individual academic to engage in that form of work which seems to him or her to be most useful and most constructive and in which he or she may be going against the received view and may be unpopular. It may create administrative difficulties for vice-chancellors but they recognise those difficulties and have said that they are prepared to accept them.
I urge the Governnment to put those words into the Bill which will protect the individual rights of academics and by so doing protect and continue the very fine history of the universities in this country in safeguarding academic freedom and freedom of thought.
Lord Allen of Abbeydale: As Amendment No. 277 has been grouped with the others, perhaps I could say a word about it. It is aimed at the same goal as the amendment moved by the noble Lord, Lord Jenkins of Hillhead, but I should like to put on record that it tries to reach it by a different route. It would put an obligation on the university to satisfy the commissioners that it had made provision which ensured that academic freedom within the law was secured for members of that university. In adopting that approach the amendment follows the precedent of Section 43 of the Education (No. 2) Act 1986, which provided:
"Every individual and body of persons concerned in the government of any establishment to which this section applies shall take such steps as are reasonably practicable to ensure that freedom of speech within the law is secured for members, students and employees … and for visiting speakers".
While I am on my feet perhaps I could say that, as has been pointed out, other countries, including Canada as we now know, have managed to evolve satisfactory working definitions of "academic freedom". There are strong feelings on this topic held in the universities and there will be great puzzlement if the Bill emerges without a safeguard of some kind being written on this point. I very much hope that the noble and learned Lord will be able to give some reassurance to us when he replies to the debate.
Lord Grimond: I have put my name to an amendment which is grouped with the amendment under discussion. Therefore I should like to say a few words about it and about academic freedom in general. I do not intend to cover the arguments which have been deployed. I wholly adopt what has been said by the noble Lords, Lord Jenkins and Lord Thomas, and others. They have adequately covered
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the essential needs for those in universities to be able to express unpopular or alarming opinions yet not be persecuted because they are unorthodox.
I should like to turn to one or two other points, although I fully admit that that is the real core of the matter. First, what is the real mischief about tenure? How many cases are there in which tenure has done great harm? I have no doubt that some academics have presumed on tenure and possibly have not pulled their full weight. However, there is a danger in attacking tenure.
In America, for instance, attacks on tenure have led to those who do not have it being left unprotected against a form of persecution. There is a danger that we may encourage universities not to go for excellence, which has its dangers, but for the safe second rate. I do not believe that that would be at all desirable in the case of British universities. Therefore unless there are strong reasons of which I have not heard against a general attack on tenure, I have an open mind. I agree that no one can claim a right for ever to a certain job but I believe that we must carefully consider the results of totally abolishing it.
The present situation has led to the frustration of some movements which I understand the Government want. For instance, at the University of Kent, with which I have the honour to have an amateur connection, we are most hampered in arranging for an exchange of departments with another university because that will mean the end of tenure. I understand that promotion means the end of tenure. This is not working out exactly in the way the Government hope because it is preventing the movement and collaboration among universities which they seek.
The second point that I wish to stress arises from my amendment. It has already been eloquently mentioned by my co-signatory, the noble Lord, Lord Morton. The noble Lord, the noble Earl, Lord Russell, and myself have drawn attention to the need for a university with a free and independent community of scholars in a wide range of subjects. I believe that that is also under attack. However, to my mind it is absolutely essential to the very nature of a university as we have been brought up to believe in it ever since the days of Newman.
The technical contribution of universities is enormously important. Their research in science and pure science is of almost incomparable importance. However, it is not their only importance because I believe that the contribution of universities will increasingly be to look at the really important questions of our time. They are questions regarding, for example, genetic engineering; pollution; how to deal with the vast number of impoverished people in the world. They need not one discipline but co-operation among many. I am told that in science advances are made through interdisciplinary work and not simply through one discipline. Therefore we want to keep a wide community of scholars, from all kinds of backgrounds and disciplines, if the universities are to play their fullest part in the modern world.
I have heard it said, although not in this Chamber, that our universities compare badly with those of Germany and Japan as regards training engineers

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and other technologists. I wholly reject that argument. Unfortunately—and possibly through no fault of the universities—the German nation has hardly contributed to civilisation in this century; nor has the Japanese nation. One can think of the two world wars. I should rather have a country which had a more civilised view of the world and was not wholly concentrated on material wants. I should also like to point to the importance of judgment. I maintain that those matters are more important to the world today and to this country than the advance of pure technology, important as it may be.
I believe that those matters are of the greatest importance to the nation at large. Therefore academic freedom is not only of great importance to scholars, scientists and those in universities but is essential to British life. It is not only a question of safeguarding the unorthodox. Education is an art and not a science. We must be careful in laying down rules about it.
I was taught modern history by one of the greatest medieval historians of this century, Professor Galbraith. At first sight it may be thought that he was not a suitable person to teach modern history. He did not approve of it very much. He thought that the world had gone downhill since the end of the Middle Ages. He shared a profoundly new and interesting view on modern history and it was a revelation for a boy coming from school to be taught by someone who did not take the orthodox view. It was not revolutionary; he merely pointed out a different view. I speak subject to correction by the noble Lord, Lord Morton, but I believe that one of the greatest authorities on constitutional law in Scotland was a professor of Sanscrit.
One cannot foretell the contributions that people will make. By having what may at first sight appear to be unwordly disciplines, such as medieval history— which I suppose does not add to the balance of payments and contributes little to the public sector borrowing requirement—something is injected into universities which is vital to their very idea. It throws a new light on certain aspects of our life which can be immensely important. Therefore I beg the Government to pay attention to what has been said throughout the Committee today.
We must put something into the Bill which makes it abundantly clear that the Government respect the idea of university and that at the core of the idea is freedom, including the freedom to be eccentric and unorthodox.
4.45 p.m.
Lord Beloff: After the interesting tour d'horizon to which we have been treated by the noble Lord, Lord Grimond, perhaps we can come back to the nuts and bolts of the matter. I rise to speak briefly in support of the amendment proposed by the noble Lord, Lord Allen of Abbeydale. I believe that it has the approval of the Committee of Vice-Chancellors and Principals. His suggestion of the way in which we can obtain our common objective appears to me to be the most effective and comes closest to the general intention of this part of the Bill.
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I am extraordinarily surprised that I must speak in support of such an amendment. As the noble Lord, Lord Hatch, reminded us, it is as long ago as last November that, in the speech made by my noble friend Lady Hooper and in other pronouncements, the Government committed themselves in principle to embodying this in the Bill.
Many of us on this side of the Committee find it very difficult to understand why after six months of discussion, representations from the universities and negotiations with the Committee of Vice-Chancellors and Principals it is still not possible, unless the noble and learned Lord can delight and surprise us, for the Government to meet the unanimous wishes of the university community. A cause that unites the noble Lord, Lord Hatch of Lusby, and myself must be regarded as having a very broad spectrum of support.
I do not know whether this is true, but it is commonly said in university circles that the difficulty has been in the inability of the Government's lawyers to define academic freedom and the belief that without such a definition it cannot appear in the Bill. If this is true, it seems to me to be most extraordinary. It is like asking one to believe seven impossible things before breakfast.
Academic freedom is an abstract concept, but lawyers are used to dealing with abstract concepts. They talk freely. When the noble and learned Lord refers to the proceedings of the Judicial Committee of your Lordships' House I am sure that he says that they are dispensing justice. The meaning of justice has been argued about ever since Plato. To take a more mundane example, we know that in the last decade one of the principal growth areas of English law has been administrative law; the intervention by the courts in the administrative process. This has very largely rested on the single word "reasonable". Was the Minister's action reasonable? Was the action of the borough council reasonable? However, I dare say it would be very difficult to find a definition of reasonable.
In other words an abstract concept can be used in a legal document if you trust your courts. It is in the course of applying the principle to individual cases that the concept is fleshed out and precedents are created to which subsequent cases can be referred. Perhaps the noble and learned Lord will enlighten me, but I am baffled as to why what is possible with regard to fairness and reasonableness is impossible with regard to academic freedom.
I do not believe that the mischief that we are seeking to correct is likely to be a very widespread one. The kind of case to which the noble Lord, Lord Hatch of Lusby, has referred is pretty rare in British university experience, whether in universities which have tenure or those which have never had tenure. On the whole the university communities in this country, at least in this century, have been tolerant places and few people have suffered from holding unorthodox or unpopular opinions. However, it can happen in relation to social questions; it can happen in relation to scientific investigation where it is even more important that it should not happen. Some new branches of science were very much frowned upon by the scientific establishment when they began. If people feel that they are losing their jobs because

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their field of inquiry calls into question conventional wisdom, surely this situation should be met.
I could understand it if the vice-chancellor of a university said, "Please do not land us with the possibility of litigation even if this is likely to happen only very rarely". The universities, which would have to confront any litigation arising out of such a commitment to academic freedom and would have to devise perhaps complicated internal procedures of investigation appeal could say that they have a lot else on their plate. But when the universities themselves are unanimous in asking for this system, which they would have to operate, I remain, as I said at the beginning, totally unable to understand why the Government do not stop this debate short. Why does the noble and learned Lord not get to his feet to say that although he does not like the wording of the amendment of the noble Lord, Lord Allen, or one of the other amendments, he is quite prepared to follow what the Chancellor of the University of Oxford has said and to come forward with something which will satisfy the case that has been made this afternoon. We could then get on to the rest of the Bill and perhaps get home a little earlier tonight.
The Lord Chancellor: If Members of the Committee are anxious to get home, I am very anxious to speak. I can see that there are one or two others who wish to make a contribution and it is in deference to them that I have not—I am grateful for that, which I might take as a welcome. The Government have always been committed to the view that the concept of academic freedom is a valuable one. It has been expressed eloquently in words which have been adopted in the amendment moved by the noble Lord, Lord Jenkins of Hillhead. The Government have no desire whatsoever to damage that concept or put it in peril.
On the other hand, as my noble friend Lord Beloff says, the concept of academic freedom is an abstract one and it ought to be capable of some analysis. I would venture to suggest that although the voice of the universities to which he referred is unanimous on academic freedom, it may not always be easy to apply it in all possible circumstances.
In approaching this subject I should like to adopt at least one of the points made by the noble Lord, Lord Grimond. He said when referring to universities that education is an art, not a science. I am not sure whether I entirely agree with that, but it is the next bit that I am particularly concerned about. He says that one must be very careful in laying down rules about it. That is exactly the difficulty. Precisely how does one lay down rules about it?
As I indicated to your Lordships at Second Reading, for some little time now I have been concerned in this problem, along with my colleagues the Ministers in the Department of Education and Science. We have arranged to meet representatives of the Committee of Vice-Chancellors in order to discuss this matter in some detail. These discussions are continuing and they promise to be fruitful. I am extremely grateful to Sir Patrick Neill, the Vice-Chancellor of the University of Oxford, for his
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kindness in sparing the time to come and discuss these matters with me in some detail.
There are many situations to which these abstract concepts require to be applied. It is not easy to say precisely how this should be worded. I do not think the Committee would wish me to look at the detail of the various amendments that have been proposed this afternoon, but I could, if necessary, indicate examples which have occurred to me where it might not be very easy to apply the terms of these amendments to produce a result which I believe the authors of the amendments would wish.
For my part I believe—and these are provisional views which we are trying to develop as fast as we can and I point out to my noble friend Lord Beloff that it has not proved particularly easy—that the centre of the matter was raised by the noble Lord, Lord Hatch of Lusby. He said that what is required is protection against dismissal. Moreover, and I mentioned this on Second Reading, we are proposing a grievance procedure in respect of the action or inaction of the institution short of dismissal, because it is possible to effect this matter in ways other than the extreme sanction of dismissal. I believe that the root of the matter is in dismissal.
We have sought to provide that dismissal shall be arrived at only as a result of a proper procedure. We have provided that the commissioners will establish a proper procedure for dismissing staff. Staff will not be dismissed without recourse to a properly established procedure for that purpose. Secondly, there should be an appeals machinery in respect of such dismissal so that all members of the academic staff have the means to test the grounds of their dismissal and have an effective measure of protection against victimisation by their colleagues.
I pause to say that the amendments which we are now considering are concerned with protection of the individual academic against his colleagues or the management of the university. We are not concerned with the academic freedom of a university as a whole. That matter was discussed on Monday in relation to funding and, speaking generally, the principles of that were discussed then. Here we are discussing, at least primarily, the protection of the academic from losing his job. That would only happen immediately as a result of action taken by the university or employing institution.
As an aside, we have proposed the removal of the exclusive jurisdiction of the visitor over cases of dismissal of academic staff allowing staff the same recourse to the courts of law which others enjoy. I do not believe that it is a particularly important point to stress at this stage. However, I want to stress emphatically that we have provided that the dismissal and appeals procedures and machinery are just and fair; in other words, no one is to be dismissed except in accordance with a decision which is just and fair. As my noble friend said, these are abstract and very general concepts which are capable of being applied by the courts.
Perhaps I may ask: what extra does the reference to academic freedom provide? Would anyone say that someone who has been dismissed in breach of, what we understand in language suitable for a speech as,

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academic freedom, has been dismissed in accordance with a procedure which is just and fair? These concepts have to be applied against the background of the university. Would somebody who has been dismissed in breach of the doctrine of academic freedom be dismissed in a just and fair manner? I should have said not. Therefore, I suggest that the abstract criteria of justice and fairness with which, as my noble friend said, the courts are very familiar and which they have used considerably to develop the administrative law of this kingdom are perfectly adequate to support the notion, doctrine or abstract idea of academic freedom.
However, having regard to all that has been said and seeking to work out examples on this matter, I believe that progress may be made by adding to those criteria some indication of matters which will not found a good dismissal; in other words, seeking to build on the kind of example that the noble Lord, Lord Hatch of Lusby, gave. For example, it would not be sufficient to dismiss a member of the university staff merely because he holds or expresses a particular opinion.
5 p.m.
Lord Hatch of Lusby: How does this Bill protect an individual academic who is declared redundant because of financial stringency and is then replaced by somebody younger and cheaper? Does that come within the Government's definition of fairness, or, if not, how can it be prevented within the terms of the Bill?
The Lord Chancellor: I believe that that is a slightly different point from the general one and depends on the precise definition of redundancy which is used and which is the subject of amendments to which we shall come later. If the noble Lord will allow me, I would rather concentrate on the general case.
It seems to me that in order to justify dismissal the procedure used would have to be fair and the result reached in accordance with justice. Speaking generally, I believe that academic freedom, in the context in which this is applied, would thereby be secured. However, I see that it may be of assistance to add to those terms "justice and fairness" something which would prevent a university from dismissing someone merely on account of the opinions which he holds.
As I said on Second Reading there are difficulties about that. The noble Lord, Lord Morton of Shuna, gave us an example of the faculty of divinity of the University of Edinburgh which is working under a trust deed which says that if the teaching of the faculty of divinity is no longer in accordance with the faith of the Church of Scotland then the whole property reverts to the Church of Scotland. It is clear that the idea of that part of that great university is that there are views which it would be the object of these particular chairs to advance. Therefore, I believe it is necessary to have a qualification such as, "Views or opinions not in conflict with the terms of the appointment and with the job that the person has been employed or appointed to do". Working on that approach, I believe that it may be possible to strengthen the protection which academic staff have
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against what we would regard as improper dismissal in that particular way. That is the line which we are seeking to follow.
Lord McCarthy: Would the noble and learned Lord the Lord Chancellor say that the position which he is now adopting squares with the argument which he put forward on Second Reading? On that occasion he drew a very clear distinction in his own mind between that which was fair and just and that which represented academic freedom when he said:
"Any reference to academic freedom might lead the courts to conclude that since Parliament had deliberately mentioned it in the Bill, it must mean something quite distinct from justice and fairness, concepts with which they are familiar. Applications could be made to the courts for declarations that the amendments proposed by the commissioners in particular institutions conflicted with the provisions protecting academic freedom, thus exposing the work of the commissioners to fruitless and disruptive litigation".—[Official Report, 19/4/88; col. 1336.]
That must suggest that in the noble and learned Lord's mind there is fairness and justice, there is academic freedom and in certain circumstances there are distinct concepts that have to be balanced, and one has to have all three.
The Lord Chancellor: I am sorry, that is not the way that my mind was working on that occasion. I was saying that justice and fairness applied to the question of an academic dismissal would also imply the need to respect academic freedom as I would understand it in general terms. Therefore, to add to the concept of academic freedom to the concepts of justice and fairness would in the circumstances add nothing at all. If one added that concept the court, in accordance with the ordinary construction, would have to say: "We have justice, we have fairness, but Parliament has added this extra academic freedom. What extra effect does that have in this context?". That is a difficulty.
I believe that it is better to try to analyse the concept and to see what in addition to justice and fairness we wish to convey to the court by such an idea as academic freedom. I believe that, on analysis, we want to convey to the court that an academic shall not be liable to dismissal—I take that as the paradigm case—merely because he or she holds a particular view, an unpopular view, a controversial view, or merely because he or she questions received wisdom and so on. I believe that there is possibly scope for improving what we have in this line.
As I said, I do not wish to take up the Committee's time by giving examples of particular difficulty. To give just one to show what can be a difficulty, I take the language used by my noble friend the Minister in her speech, by my right honourable friend the Secretary of State for Education in a speech and again in the amendment proposed by the noble Lord, Lord Jenkins of Hillhead. We have the idea that academic staff should have freedom within the law to question and test received wisdom and to put forward new ideas and controversial or unpopular opinions.
To go to the field of endeavour of the noble Lord, Lord Howie of Troon, if a professor of engineering had a somewhat unpopular view that floors could be half the thickness that anybody else thought was necessary—he did not believe the safety margins that

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other people required were justified, but that buildings could be built with floors half the thickness that everybody else thought—he would be perfectly free to put that forward, but I think that it might not be wise to have that as the teaching to the young engineers—who, if I may say so with respect to the noble Lord, Lord Grimond, I hope the universities will continue to teach—coming out to design high buildings.
The idea is therefore best put in relation to protection against dismissal and in relation to grievance procedure, which, as I said, we hope to put into the Bill. I regard the matter as not entirely an easy one, as I said. However, it is one in which it may be possible to make constructive progress. Our discussions with the representatives of the vice-chancellors are going on. I hope that on Report we might be able to bring forward something that would commend itself to noble Lords, refining the line that I have sought to explain today.
In the light of that expression of view, I hope the Committee may think it right for us to have the opportunity to do that. As the Committee knows, I was invited to speak. I was anxious also—I still am—to have as much help and expression of view about the matter as is consistent with the desire to make reasonable progress.
5.15 p.m.
Lord Peston: I speak slightly reluctantly because, with respect, I disagree somewhat with the noble and learned Lord, as I shall outline. I fully accept his bona fides in these matters. I believe that, were we to come across individual cases of threats to academic freedom, he like the rest of us would be in the forefront in condemning them and hoping that something could be done about it. I think that the matter is not entirely as he puts it, so it would be reasonable for me to suggest that.
Before so doing, I must say a word or two about tenure. The noble Lords, Lord Jenkins of Hillhead and Lord Thomas of Swynnerton, both mentioned tenure. They mentioned it first as if we have had the debate on tenure, which I believe we have not; and they mentioned it secondly not only as if the debate was over but as if it was agreed generally that tenure was a bad thing and that it inevitably had to go. Ahead of what will happen later, and bearing in mind the need to hurry, I say that I do not accept that tenure is a bad thing and that it should go; and I shall outline such arguments in due course.
I argue that we would not be in this rather messy discussion if the Government had not in a rather foolhardy way gone down the path of the abolition of tenure, and if the Committee of Vice-Chancellors had not seemed to acquiesce in that and in so doing, in my view, to betray the true cause of academic freedom. I say that in strong and definite terms. The tenure argument has not happened, but it certainly will happen.
In regard to academic freedom as it pertains to our universities, I ask, as I have asked before, why are we doing any of this anyway? We have what is recognised as a truly great university system. It is a
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system, I shall argue in due course, that is effective, efficient and productive and that meets all the kinds of buzz word criteria on which the Government are so keen. Why is it being interfered with? The noble Lord Lord Thomas of Swynnerton, implicitly raised the point as to why the universities are being put in the undignified position of being tagged on to other important aspects of an education Bill. I believe, as I think he implied, that the universities deserve full and sympathetic treatment on their own. What concerns me in much of the discussion is the lack of sympathetic treatment.
In regard particularly to the amendment, it is very important to recognise that, while the noble and learned Lord the Lord Chancellor is right in saying that a great deal of the question of academic freedom is concerned with the rights of the individual and therefore that much of this is to do with practical matters in terms of procedures, protection against dismissal and so on, he goes too far in my view, because academic freedom is concerned—as I think is referred to in one of the amendments—with the whole community of scholars. It is not just about individuals; it is about the whole place. It is about atmosphere, and the way in which universities conduct themselves. I also do not believe that it is just about dismissal. It is not. It is about at least two other matters on which I think the noble and learned Lord would agree. It is certainly about promotion, and it is about placing undue pressure on staff, notably junior staff.
The Lord Chancellor: For brevity's sake, I mentioned that we were proposing to bring forward agreements procedure which would have an effect on that. I therefore concentrated on dismissals as the paradigm case.
Lord Peston: I fully accept that as the paradigm case. The notion of pressure on staff, which is often again slightly indefinable, is a difficult matter to isolate within a grievance procedure, but it certainly is easy to isolate in terms of the atmosphere of the university.
Academic freedom and justice and fairness are two different things. To give an example, when I was a junior lecturer I would have regarded it as unfair and unjust if I had been asked to teach many more courses than others. I would have regarded it as unfair and unjust if I had been asked to teach a course about which I knew nothing. I do not entirely agree with the noble Lord, Lord Grimond, about the benefits of teaching courses about which one knows nothing. I would have regarded it as an infringement of academic freedom if I had been told what to teach. This is a serious and fundamental matter.
If, for example, I had been told when teaching economics as a young man, "Well, Maurice, I am afraid you cannot go on teaching macro-economics; you don't seem to believe that there is a correlation between the rate of rise of the money supply and inflation. Unless you start teaching that stuff, I am afraid that you cannot carry on with that course", I would have regarded it as an infringement of academic freedom. Equally, I would have regarded it as an infringement of academic freedom if I had said to one of my young men teaching that stuff, "I am

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sorry; you cannot teach the course because you're not teaching the theory of the Keynesian multiplier". That is what academic freedom is about.
My view—and I entirely agree with the noble Lord, Lord Beloff, on this point—is that those of us who have been in academic life know full well what academic freedom is. We can see it, and certainly in the bad old days we could see the neglect of it. I simply do not believe—and I was hoping for a slightly more positive word of assurance from the Lord Chancellor—that it is impossible to define.
In our view we ought to move forward on these amendments. If I may express an entirely personal position—one that does not commit my noble friends—my favourite amendment is the amendment of the noble Lord, Lord Allen of Abbeydale. However, like the noble Lord, Lord Jenkins, and others, I will accept any of these amendments, any permutation of these amendments or any variation of them, as long as we have an academic freedom amendment written into the statute.
Lord Annan: Will the Lord Chancellor inform the Committee whether some of us were right in thinking that in his speech he gave an assurance that at Report stage we would have some reference in the Bill to academic freedom? I took it that that was what he was saying.
The Lord Chancellor: What I was seeking to say was that on analysis of the concept of academic freedom the most appropriate expression for it in the context of the Bill would be an expression of matters which were excluded as grounds for dismissal—to take the paradigm case—and also grounds for other adverse actions such as not allowing classes to be taught and so on, points to which the noble Lord, Lord Peston, referred. That is what I have in mind.
Lord Annan: I take it that the noble and learned Lord will bring back at Report stage a Government amendment to deal with these matters. May I ask if that is so?
The Lord Chancellor: That is certainly my intention. It is my fervent hope that we shall have such an amendment by that stage. I cannot give a cast-iron guarantee, as the noble Lord will understand, but it is as near that as I can properly do.
Lord Jenkins of Hillhead: Needless to say, I listened most carefully, with fluctuating hope and disappointment, to the speech of the noble and learned Lord. I am bound to say that the shafts of hope were fairly limited and that the disappointment began substantially to predominate before he reached the end. Throughout he expressed a very narrow approach to academic freedom. He did not deploy any significant arguments against why one of the amendments before us today should be accepted without doing any possible harm. He did not very adequately explain the powerful point made by the noble Lord, Lord Beloff, who said that we were exactly here in October or November. Why has it taken so long to make virtually no progress?
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The Bill is now very close to slipping from our grasp and back to the Commons. In those circumstances, and as I did not interpret the Lord Chancellor as giving a very resounding affirmative to the two questions of the noble Lord, Lord Annan—yes he hoped there would be something but what it would be was not at all clear—and from the tenor of his speech I thought it would probably be a disappointment not merely to the majority but to the unanimity of those who had spoken, other than himself, I am disposed to ask the Committee to divide.
5.25 p.m.
On Question, Whether the said amendment (No. 274AF) shall be agreed to?
Their Lordships divided: Contents, 152; Not-Contents, 126.

Division No. 1

CONTENTS

Adrian, L.

Hereford, Bp.

Airedale, L.

Howie of Troon, L.

Allen of Abbeydale, L. [Teller.]

Hughess, L.

Hunt, L.

Amherst, E.

Hunter of Newington, L.

Annan, L.

Hylton, L.

Ardwick, L.

Hylton-Foster, B.

Attlee, E.

Ilchester, E.

Aylestone, L.

Irving of Dartford, L.

Baldwin of Bewdley, E.

Jacques, L.

Banks, L.

Jay, L.

Basnett, L.

Jeger, B.

Birk, B.

Jenkins of Hillhead, L.

Blease, L.

John-Mackie, L.

Bottomley, L.

Kearton, L.

Briginshaw, L.

Kennet, L.

Bruce of Donington, L.

Kilmarnock, L.

Bullock, L.

Kinloss, Ly.

Campbell of Eskan, L.

Kirkhill, L.

Carter, L.

Kirkwood, L.

Chichester, Bp.

Lawrence, L.

Chitnis, L.

Llewelyn-Davies of Hastoe, B.

Cledwyn of Penrhos, L.

Lloyd of Hampstead, L.

Croft, L.

Lockwood, B.

Croham, L.

London, Bp.

Dacre of Glanton, L.

Longford, E.

Darcy (de Knayth), B.

Lovell-Davis, L.

David, B.

McCarthy, L.

Dean of Beswick, L.

McFarlane of Llandaff, B.

Diamond, L.

McGregor of Durris, L.

Donaldson of Kingsbridge, L.

McIntosh of Haringey, L.

Dormand of Easington, L.

Mackie of Benshie, L.

Elwyn-Jones, L.

MacLehose of Beoch, L.

Ely, Bp.

McNair, L.

Ennals, L.

Mais, L.

Ewart-Biggs, B.

Manchester, Bp.

Falkender, B.

Mayhew, L.

Falkland, V.

Meston, L.

Flowers, L.

Molloy, L.

Foot, L.

Morris of Kenwood, L.

Franks, L.

Morton of Shuna, L.

Gallacher, L.

Mulley, L.

Gladwyn, L.

Murray of Epping Forest, L.

Goodman, L.

Napier of Magdala, L.

Graham of Edmonton, L.

Nicol, B.

Greenhill of Harrow, L.

Northfield, L.

Grey, E.

Parry, L.

Grimond, L.

Peston, L.

Halsbury, E.

Ponsonby of Shulbrede, L.

Hankey, L.

Porritt, L.

Harris of Greenwich, L.

Prys-Davies, L.

Hart of South Lanark, B.

Rea, L.

Hatch of Lusby, L.

Reilly, L.

Henniker, L.

Ritchie of Dundee, L.

461

Robson of Kiddington, B.

Thurlow, L.

Rochester, L.

Todd, L.

Roll of Ipsden, L.

Tonypandy, V.

Russell, E.

Tordoff, L. [Teller.]

Sainsbury, L.

Turner of Camden, B.

Scanlon, L.

Underhill, L.

Seear, B.

Vernon, L.

Seebohm, L.

Wallace of Coslany, L.

Seflon of Garston, L.

Walston, L.

Serota, B.

Warnock, B.

Shaughnessy, L.

Wedderburn of Charlton, L.

Shepherd, L.

Wells-Pestell, L.

Sherfield, L.

White, B.

Somers, L.

Wigoder, L.

Stallard, L.

Wilberforce, L.

Stedman, B.

Williams of Elvel, L.

Stewart of Fulham, L.

Winchester, Bp.

Stoddart of Swindon, L.

Winstanley, L.

Strabolgi, L.

Winterbottom, L.

Swann, L.

Wolfson, L.

Taylor of Mansfield, L.

Young of Dartington, L.

Tedder, L.

Zuckerman, L.

Thomas of Swynnerton, L.

NOT-CONTENTS

Airey of Abingdon, B.

Hailsham of Saint Marylebone, L.

Aldington, L.

Alexander of Tunis, E.

Harmar-Nicholls, L.

Ampthill, L.

Harvington, L.

Arran, E.

Havers, L.

Bathurst, E.

Henley, L.

Bauer, L.

Hesketh, L.

Beaverbrook, L.

Hives, L.

Belhaven and Stenton, L.

Hood, V.

Belstead, L.

Hooper, B.

Benson, L.

Jenkin of Roding, L.

Birdwood, L.

Johnston of Rockport, L.

Blyth, L.

Killesarn, L.

Boyd-Carpenter, L.

Lauderdale, E.

Brabazon of Tara, L.

Long, V.

Brightman, L.

Lothian, M.

Brougham and Vaux, L.

Lucas of Chilworth, L.

Bruce-Gardyne, L.

Luke, L.

Butterworth, L.

Mackay of Clashfern, L.

Caithness, E.

Macleod of Borve, B.

Caldecote, V.

Mancroft, L.

Cameron of Lochbroom, L.

Margadale, L.

Campbell of Alloway, L.

Marsh, L.

Carlisle of Bucklow, L.

Massereene and Ferrard, V.

Carnegy of Lour, B.

Merrivale, L.

Carnock, L.

Mersey, V.

Coleraine, L.

Milverton, L.

Constantine of Stanmore, L.

Mottistone, L.

Cottesloe, L.

Mowbray and Stourton, L.

Cowley, E.

Munster, E.

Craigavon, y.

Napier and Ettrick, L.

Craigmyle, L.

Nelson, E.

Crawford and Balcarres, E.

Newall, L.

Crickhowell, L.

Norfolk, D.

Cullen of Ashbourne, L.

Norrie, L.

Davidson, V. [Teller.]

Northesk, E.

Deedes, L.

Nugent of Guildford, L.

Denham, L. [Teller.]

Orkney, E.

Derwent, L.

Orr-Ewing, L.

Eden of Winton, L.

Pender, L.

Elliot of Harwood, B.

Pennock, L.

Erroll, E.

Plummer of St. Marylebone, L.

Erroll of Hale, L.

Faithfull, B.

Reay, L.

Ferrers, E.

Renton, L.

Ferrier, L.

Rodney, L.

Fortescue, E.

Romney, E.

Fraser of Kilmorack, L.

St. Davids, V.

Gainford, L.

Sanderson of Bowden, L.

Gisborough, L.

Sandford, L.

Glenarthur, L.

Sharpies, B.

Gray, L.

Shrewsbury, E.

Greenway, L.

Simon of Glaisdale, L.

Gridley, L.

Skelmersdale, L.

Grimston of Westbury, L.

Strange, B.

Haddington, E.

Strathspey, L.

462

Sudeley, L.

Trumpington, B.

Swinton, E.

Vaux of Harrowden, L.

Terrington, L.

Ward of Witley, V.

Teviot, L.

Westbury, L.

Teynham, L.

Wise, L.

Torphichen, L.

Wyatt of Weeford, L.

Trafford, L.

Young, B.

Trefgarne, L.

Young of Graffham, L.

Resolved in the affirmative, and amendment agreed to accordingly.
5.35 p.m.
Lord Grimond Lord Grimond moved Amendment No.274B:
Page 159, line 11, at end insert—
("( ) There shall be separate Commissioners for Scotland.")
The noble Lord said: I beg to move the amendment which stands in my name—
Lord Harmar-Nicholls: May I make a point which I think is of some importance?
Noble Lords: Order!
Lord Harmar-Nicholls: Is there any way of knowing whether the general convention will be followed in this case where an undertaking was given by the noble and learned Lord the Lord Chancellor, on behalf of the Government, which has not been accepted? Is the noble and learned Lord now freed from all the undertakings he gave prior to the vote being taken?
The Lord Privy Seal (Lord Belstead): My noble friend is trying to be most helpful in party political terms, and indeed he is being helpful. However, in my other capacity I must say, with the greatest respect to my noble friend, that there is no locus here to ask such a question. The next amendment has been called and the Committee must therefore proceed.
Lord Grimond: I rise for the second time to move the amendment tabled in my name and that of the noble Lord, Lord Morton of Shuna. The amendment deals with the position of the Scottish universities and asks that there should be a separate commission for Scotland. We touched on the matter rather late at night last week. I am well aware that in some ways by addressing the noble and learned Lord the Lord Chancellor on these matters I am attempting to teach my grandmother to suck eggs, because he is well versed as regards the position of Scottish universities. However, the Lord Chancellor is not in charge of education in Scotland and he is not in charge of the Government. In other words, what he says in this Chamber does not bind the Government.
I strongly feel that we need some provision written into the Bill which accepts and stresses the independent and most important position of universities in general in Scotland—and in particular the four old universities. I do not want to repeat their separate histories. They are of course the oldest universities in the kingdom, except for Oxford and. Cambridge. They come from quite a different stable, being founded on the lines of Bologna and Paris. They are deeply embedded in Scottish history and are dearly loved in Scotland as some of our most prominent institutions.

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Further, their organisation is quite different. For example, at one time the head of the university was directly elected by all those in the university; that is, the students and the staff. The education system in Scotland is also quite different. Its timing is different and therefore their first year and indeed their whole academic programme is different. There does not seem to be much connection between the first and the last parts of the Bill. That strikes me as a defect. The Bill does not seem to link what it is saying about primary and secondary education with what it is saying about higher education.
I should also point out that Scotland is a nation which has no parliament. Therefore it is doubly important that its institutions should express the native culture and abilities of the Scots. I believe it is also important that free-standing institutions in England, such as the universities, should maintain their independence and their power. It is doubly important that in Scotland we have some other centre. As we have no government of our own we need some protection against central government in Whitehall.
If the Committee thinks that the Government would agree with that, I must draw its attention to what happened only on Tuesday of this week when, at the end of the debate on the future of the ILEA, the Government announced, as though it were of great benefit to us all, that they intended to vet the appointment of local authorities' chief officers. I thought that one of the most astonishing statements I have heard in Parliament since I have been here.
That announcement shows, first, an extraordinary lack of trust in local authorities. Secondly, it shows that central government, who always have a large majority, think they know best about everything. They are gradually eroding the powers of local authorities, the law, the BBC and the universities. Therefore in Scotland, in particular, and in Britain as a whole, it is extremely important that we send out a signal that we appreciate the importance of those centres and, especially, of Scottish universities.
I believe, as I have said, that the Bill is directed at the wrong target. If there is one thing wrong with university education in this country—it is no fault of the universities—it is that far too few boys and girls from working class homes reach the universities. That is the fundamental problem. In Scotland, the position is rather better than it is in England. In Scotland far more boys and girls look forward to further education at a university than in the rest of Britain. They feel that the universities are far more part of their life than is the case further south.
It is important that that feeling should be encouraged, that all Scottish universities should retain the full range of subjects and disciplines so that they are true universities, and that the boy or girl from Orkney or Shetland who goes to Aberdeen University will find there all the essentials which, as I said in a previous debate, Newman set out so well.
Owing to pressure of finance, universities are already being cut down. Three departments at Aberdeen are due for closure. One is the Italian department. That is an important department as Italy is one of the great centres of our civilisation.
464
The commission's activities, which I view with some suspicion, are of great importance to Scotland. I doubt whether a commission of five people, as I think it is to be, will understand the Scottish situation if dealing with the whole of Britain. The position of the Church in Scotland was mentioned by the noble and learned Lord the Lord Chancellor and by the noble Lord, Lord Morton of Shuna. The position of the visitor has been mentioned. The visitor is known in English universities. However, the rector is not mentioned and is not known in English universities. It is therefore conceivable that the commission may have an effect upon the position of the rector, which is carefully protected in Scottish universities. Speaking as a former rector, I know that a rector does an extremely important job.
It will not be enough to say that one member of the commission will know something about Scotland. I need not tell the noble and learned Lord the Lord Chancellor that Scottish law is different from English law. As the commission will be very much involved in law, it is important that it fully appreciates the difference between Scottish and English law.
I am wholly on the Government's side in thinking that the commission should be small and should act quickly. I am not sure that that is compatible with the present arrangements. It has some 40 to 50 institutions to inspect. From a practical point of view it may be desirable to appoint a separate commission for Scotland so as to do the job more quickly and efficiently.
It will be necessary to have people on the commission who know about Scotland. It is therefore essential if there are to be small commissions that there should be more than one. I beg the Government to realise that Scotland is not north Britain; it is a separate country, even though it has no Parliament. I also beg them—I am sure they realise this—to have a higher opinion of universities than sometimes appears.
I shall finish by giving a puff to a most admirable pamphlet written by a man called Professor Kedourie, whom I must confess I have never met, which is called Diamonds into Glass. It is about a Conservative government's intentions for the universities of this country. It emanates from the Centre for Policy Studies, whose founders were Mrs. Thatcher and the noble Lord, Lord Joseph. I beg to move.
5.45 p.m.
Lord Howie of Troon: We debated this matter—
Lord Harmar-Nicholls: I think it is the turn of this side now.
Lord Howie of Troon: I do not think—
Lord Harmar-Nicholls: I thank the noble Lord for giving way. I want to use the amendment to pursue the point that I made a minute or two ago—
Noble Lords: No, no!
Lord Harmar-Nicholls: The point is of some considerable importance to the procedures of this place. I am all in favour of votes. That is often the

465
only way to cut through a knot that cannot be untied. One sees that. I am not emotional about losing a vote. You win some; you lose some. However, I am concerned about this place maintaining its high standards of adhering to the accepted convention of accepting government undertakings.
On the previous amendment, after a full debate in which there was a cross-examination by the noble Lord, Lord Annan as to what my noble and learned friend meant when he replied for the Government, my noble and learned friend made it clear, as I understood it, that having heard the debate he was still in consultation with the university authorities who are dealing with the very subject of the debate.
Baroness Seear: Perhaps I may—
Lord Harmar-Nicholls: Perhaps I may just make my point.
Baroness Seear: The noble Lord—
Lord Harmar-Nicholls: If I may just make my point, I should be delighted to give way.
Baroness Seear: If the—
Lord Harmar-Nicholls: I shall be delighted to give way when I have made my point.
Having listened to the debate, having said that he was in consultation with the authorities that mattered and with Report stage still to come, my noble and learned friend gave as clear an undertaking as one could expect under the circumstances that he sympathised with the points of the amendment and was most likely to be able to meet them. One presumed that to mean at a later stage in the Bill. For the Committee not to accept that in those circumstances was against the conventions.
Baroness Seear: The noble Lord—
Lord Harmar-Nicholls: I am not giving way until I have made my point.
Noble Lords: Order, order!
Lord Harmar-Nicholls: I am not giving way until I have made my point.
Noble Lords: Order, order!
Baroness Seear: We are debating an amendment moved by my noble friend Lord Grimond. May I ask that we continue on that amendment?
Noble Lords: Hear, hear!
Lord Harmar-Nicholls: I shall make my point on adhering to conventions and conclude.
Lord Denham: With due respect to my noble friend, we are now on another point; we must listen to the noble Baroness.
Lord Howie of Troon: I apologise to the committee. I was obviously over polite. That was an error on my part.
I support the amendment moved by the noble Lord, Lord Grimond. We debated the general nature of the subject at a late hour the other evening. It may be convenient if I repeat briefly remarks I made at greater length when there were only a few Members of the Committee present. Before doing so, however, I should like to remind the noble Lord, Lord Grimond—I refer to his speech during the last debate—that Scottish universities have engineering schools of great excellence. Were it not for engineers, our civilisation would not exist. We should be left speaking to one another in Sanskrit, or in whatever language he referred to, in caves, swamps and similar places.
Lord Grimond: I am deeply ashamed if I dared to criticise the noble Lord, Lord Howie, or engineers. If I did, I shall withdraw the remark at once.
Lord Howie of Troon: The noble Lord did so and is suitably admonished. The point is that, as the noble Lord, Lord Grimond, said, Scotland is a separate place. Whether or not it is a nation is academic in a sense, but we believe it to be a nation. The university system is entirely different from that of England. It is therefore quite wrong that it should merely be stuck in as part of a general system which applies to England and Wales.
As to the particulars in which the system is different, as the noble and learned Lord the Lord Chancellor knows full well (although his fellow Ministers may be less aware of it) the mode of entry into the Scottish universities is different from that in England. The length of the course is generally different from that in England. The nature of the teaching is different from that in England. I shall not go so far as to say that the graduates are better than those in England because that might not always be true. The Scottish system is more continental than the English system. Because it is different in all these respects and is not in any way the same as the English system, the noble Lord, Lord Grimond, was right to put down this amendment. The Committee would be wise to accept it.
Lord Morton of Shuna: The amendment is in my name as well as that of the noble Lord, Lord Grimond, and I rise to support it very briefly. As noble Lords who have spoken have said, we have already had this debate on one occasion—late on Tuesday night. The necessity for having separate commissioners for Scotland, I suggest, is absolutely clear. If the commissioners are to operate over the whole of the country, they will naturally be far more concerned with the 37 English and Welsh universities. The Commissioners will approach them properly in the light of the English and Welsh education school systems. The continuation of four of the Scottish universities was guaranteed by the Act of Union. Scottish universities are entirely different and are based on a Scottish system of school education which is entirely different and for which the Department of Education and Science has no responsibility.

467
It is essential, for the various reasons that have been put forward—and I am attempting to move the debate along a bit—that the Scottish commissioners should be separate and should fulfil this function in the totally separate climate of the Scottish universities. I strongly support the three amendments in this group.
Baroness Carnegy of Lour: I was not able to be present for the previous discussion late at night. For the benefit of noble Lords who have not been involved in this scene, very briefly the STEAC—the Scottish Tertiary Education Advisory Council—looked at the whole issue of whether the universities should stay in the mainstream of the whole of the university system in the country, as they have been, or whether they should be funded separately. The council recommended that they should be funded separately, but the universities in Scotland were split about whether they wanted that. The Government came down on the side of the status quo. That has been settled. The universities are now in one system and they remain in one system. That has been accepted.
The point at issue is not that; we must not confuse matters. In this amendment we are talking about how the commissioners operate. It seems to me that the question of the amendment is entirely dependent on whether the function of the commissioners is better arranged if some body or two commissioners are operating only in Scotland, meeting the other commissioners and making their decisions; whether they operate quite separately, or whether there is no Scottish commissioner at all. That is the question.
I hope that in thinking about this we shall realise that we are talking about the function of the commissioners within a system which, it has been agreed, is one over the whole of the United Kingdom. We should not be confused in our sudden slight spasm of nationalism into thinking that to accept this amendment will help the universities to be separate. It will not.
Lord Mackie of Benshie: Perhaps I may add briefly to the discussion. Of course I support the amendment, and I wish to say to my noble neighbour Lady Carnegy that as I remember the universities wish to remain within the orbit of the University Grants Committee. That was because they did not want in any way to come under the Scottish Office; that was their objection. They certainly had no objection to a separate University Grants Committee for Scotland. They would have accepted that happily.
I think one of the best points made by my noble friend Lord Grimond was that if there is not a separate commission for Scotland then the poor Scot who is one of five among the United Kingdom commissioners will either spend his time making himself most unpopular, trying to teach his four comrades, or he will not get his point across. As has been illustrated, the differences are both wide and deep. There is no question at all that the system will not get due consideration if one Scot is appointed to the main commission.
The Lord Chancellor: I think it is important in considering this amendment to understand the job of the commissioners. That job is to make appropriate provisions in the statutes of each of the qualifying institutions for procedures for dismissal which are just and fair. The reason for having commissioners is that each of the universities is somewhat different. There are differences between the institutions which are important in considering what their statutory procedures should be for the dismissal of academic staff. But that has nothing whatever to do with how long the courses are or what the school education system is, and even less to do with questions of a more general kind.
The basic point with which commissioners have to deal is to put into the statutes of the various universities the procedures laid down in principle by the Bill and then modified as appropriate for the particular universities. The important thing surely is to have a system which is reasonably uniform as regards the principle but so far as concerns the detail is matched with the statutes of the particular universities.
Lord Morton of Shuna: I wonder whether the noble and learned Lord will give way. Surely the job of the commissioners entails, among other things, having regard to the need to enable the qualifying institutions to provide education and to promote learning. That is what Clause 173 says, among other things. In order to do that, the commissioners must surely understand the education system of the country in which the universities are operating.
The Lord Chancellor: It is quite obvious that the commissioners have to have regard to the need,
"to enable qualifying institutions to provide education, promote learning and engage in research efficiently and economically"
in relation to the matters with which they have to deal. The matters with which they have to deal are those specified in Clause 174. The reason for having commissioners is that each institution, within the scope of its job, has different constitutional arrangements in detail.
Surely the important thing is to ensure that the principles set out in the Bill are appropriately reflected in the changes required in the individual institutions. That problem is in no way a problem which cannot be understood by anyone with the qualifications we have in mind for commissioners and who is prepared to apply his brain to it. As has already been said, it is certainly proposed that one of the commissioners should have an understanding of the position of the Scottish universities. But if this principle were to apply to Scotland, I think it would be equally necessary to have a commissioner from each of the universities in England and Wales. For example, the position in the University of Oxford is different from the position in many other universities in England. The job of the commissioners is to appreciate these distinctions and to make the necessary provision accordingly.
I should have thought that it would be very much more appropriate, when the Scottish universities are properly regarded as an integral part of the universities of the United Kingdom, that the

469
procedures for dismissal of staff should be decided upon by a common body for the whole of England, Wales and Scotland.
The ultimate responsibility in regard to the amendment lies of course with Her Majesty in council acting again for the whole of the United Kingdom. In my submission the distinctions which I readily acknowledge between the universities of Scotland and universities in other parts are also reflected between one university in Scotland and another. The universities are all different in a number of ways in their constitution and in their arrangements. So if the argument were to progress logically it would mean that there would be representation on the body of commissioners from every university in the country. That does not seem sensible. It seems much more sensible to have a small body of commissioners with a common base and within the commission sufficient expertise to deal with the problems of all the universities in the United Kingdom. Therefore I hope that the Committee will feel that this amendment is not justified.
6 p.m.
Lord Hylton: It is crystal clear to me as an Englishman that this amendment bears on the honour, self-esteem and the national culture of Scotland. Therefore, I am rather surprised that the noble and learned Lord should take so narrow a view. I urge the Government to have second thoughts.
Lord Grimond: So do I! I am deeply unimpressed by the answer of the noble and learned Lord the Lord Chancellor. I am rather horrified by it. Does he really think that the difference between the Scottish universities and the English universities is no greater than that between say Oxford and Cambridge? Is he really going to set up a commission on which there may be somebody who knows something about the Scottish universities but on which there will be no one with a knowledge of the Scottish law? Whatever the noble and learned Lord may say about this commission it will presumably be much concerned with law. Having listened to the intervention of the noble Lord, Lord Morton of Shuna, and having read Clause 173(2) which states:
"In exercising those functions, the Commissioners shall have regard to the need—
(a) to enable qualifying institutions to provide education, promote learning and engage in research efficiently and economically"
I must ask the noble and learned Lord whether he is really saying that that has nothing to do with Scottish education.
Finally, is the noble and learned Lord really intending to appoint this commission, which I think is a highly dangerous body? The last time a commission was sent out it went round the monasteries and they were abolished shortly afterwards. We have little information on what this commission is going to do. Is the noble and learned Lord gong to appoint this commission with no further explanation to Parliament as to what representation Scotland will have on it or what powers it will have over the senior institutions in Scotland?
The Lord Chancellor: The powers of the commissioners are clearly laid down, subject to any amendments that may still be made, in Clause 174. Certainly the purposes of the commissioners on this occasion do not include anything like those to which the noble Lord referred.
The purpose of the commission generally is to make sure that there are provisions in the constitution of each qualifying institution—each university in this particular case—that are in accordance with the principles set out in the clause. To summarise, there is a procedure for dismissal of academic staff which is in accordance with justice and fairness in that there is a proper appeal procedure.
I do not think that I said that there was no more difference between the universities of Scotland and other universities than there was between the universities of Oxford and Cambridge. If I recollect correctly I said that there are differences between the universities of Scotland and, for example, a university such as Oxford. But there are also differences between the University of Oxford and other universities in England. So the whole purpose of having the commissioners is that they should be able to take account of the distinctions between the different universities and apply that accordingly.
In reply to the noble Lord, Lord Hylton, I would say that one of the great attributes and honours of Scotland is that it is very well able to participate with others in obtaining a good result. It has done so in the United Kingdom for a long time. The idea of this provision is that the Scottish universities would be examined by Scottish commissioners and the English universities by English commissioners. Surely one obtains a much better result if there is a good leaven of Scots among the commissioners who are examining the universities in England and Wales too? I suggest strongly to the Committee that it would be right that a good set of five commissioners should be appointed to do this job throughout the United Kingdom.
Lord Hughes: The noble and learned Lord said just now that it would be better to have a good leaven of Scots. Does that mean that there will be more than one Scot among the commissioners?
The Lord Chancellor: I think that quality is important.
Lord Grimond: There is nothing in the Bill to say that there will be even one Scot. If that is intended it should be written into the Bill. It is indeed true that some of the powers of commissioners are laid down here. But they appear to be rather differently interpreted than in the answer given to the noble Lord, Lord Morton of Shuna.
I am bound to say that unfortunately I do not think that the answer we have heard will improve the view held by the Scottish universities as regards the Government's intention. Nor will it dispel the view widely held in Scotland that Scotland, in this Government's eyes, is simply north Britain. I hope to look at this matter again at a further stage. In the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Jenkins of Hillhead Lord Jenkins of Hillhead moved Amendment No. 274BA:
Page 159, line 13, at end insert—
("( ) to ensure that academic staff have freedom within the law to question and test received wisdom, and to put forward new ideas and controversial or unpopular opinions, without placing themselves in jeopardy of losing their jobs or privileges they may have at their institutions").
The noble Lord said: I beg to move.
On Question, amendment agreed to.
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 274C:
Page 159, line 15, after ("learning") insert ("and the exercise of judgment").
The noble Lord said: This amendment stands in the name of the noble Lord, Lord Grimond, and myself. It is a fairly minor point but it is grouped with Amendment No. 274D which stands in the name of my noble friend Lord Peston, the noble Earl, Lord Russell, and the noble Lord, Lord Grimond. Both amendments concern line 15 on page 159. The two amendments taken together would make Clause 173(2)(a) read,
"to enable qualifying institutions to provide education, promote learning and the exercise of judgment and engage in research efficiently and to the highest possible standards and economically".
In moving this amendment and speaking to the second, I hope that it will not cause any difficulty because it appears at least to me that the exercise of judgment is one of the important things taught in universities. It is important that that should be recognised in this part of the Bill which appears to lay down the standard at which the universities are to aim. Further it is as necessary that research should be done to the highest possible standard as that it should be done efficiently and economically. I beg to move.
Earl Russell: I should like to speak to Amendments Nos. 274C and 274D, which are grouped together. However, before I do so perhaps I may respond to the gracious remarks made by the noble Lord, Lord Thomas of Swynnerton. I am particularly grateful for what he said about the uncontroversial character of my maiden speech. That point caused me some anxiety. The remarks which he made about faults on both sides are ones to which it is always necessary to respond. However, what he said about the treatment of visiting speakers is a matter with which I am in full, profound and entire agreement. I shall continue to say so wherever I can find an audience for those remarks. I am happy to say that the visit of the noble Lord, Lord Joseph, to my own college was entirely free of trouble.
Turning to the amendments, we have in the Bill a case where the statement of ideal in legislation is thought, by those who drafted the Bill, to be reasonable and necessary. It says:
"the Commissioners shall have regard to the need … to enable qualifying institutions to provide education, promote learning and engage in research efficiently and economically".
We have nothing against that. There is no reason why universities should not be efficient or economic. However, if ideals are stated in one context they sometimes need to be stated in another. We have here a creative tension between that ideal and the ideal of research conducted to the highest possible standards
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and the exercise of academic judgment. As everyone who has addressed an eve of poll meeting knows, ideals thrive on constant reiteration. We have ideals which should be kept in balance. If one lot are iterated in the Bill, why should not the other be also? I cannot see that implications of academic judgment or of high academic standards can conflict with the purposes of the Government. I cannot see any good reason why they should be dismayed by their inclusion in the Bill.
Lord Annan: Perhaps I may say that I am a little dismayed by the inclusion of the phrase, "to the highest possible standards". First, that seems to me to give leverage to someone who is in a scientific department and who says, "You have not provided the equipment which I need in my laboratory; I cannot conduct my research to the highest possible standard". The authorities may then say, "We are afraid we do not have the money". But that is no excuse. That person is prevented from doing research to the highest possible standards.
Secondly, I wonder whether the provision is not redundant. We all attempt to do our research to the highest possible standard. Having said that, there are differences in standards between universities. A technological university is conducting research of a very different kind from that of the University of Cambridge or University College, London. It does not mean that that research is inferior. It is extremely important and it is probably connected directly to some problem in industry, whereas the highest possible standards at University College, London are likely to be esoteric. It may be extremely important and fundamental research which may, at some later stage, have a spin-off to industry. But there is a distinction between those two types of research. I think that the phrase muddies the waters rather than making them pellucidly clear.
Lord Peston: These are substantive and serious amendments, although they are also probing amendments. The response of my noble friend Lord Annan shows that that probing was worthwhile. As regards Amendment No. 274D, the clause as it is written refers to, "efficiently and economically". Those are words from my own subject. They do not imply anything about standards. Put crudely, what we are discussing is the relationship between inputs and outputs. A process of a very low standard can be efficient and economic so long as the inputs are disproportionately lower still. Reading it that way, as I did, I was unhappy. As my noble friend Lord Annan has said, we are very much concerned in universities with absolute standards. In our previous discussions on academic freedom, I did not put forward the very important idea that in the case of many young people almost the only acquaintance they will have in their lives with the highest standards is in universities.
In putting down the amendments, we are differentiating our own views from what we consider to be the Government's concept, which is based too heavily on economics. I sometimes believe that it is impossible for anything to be based too heavily on economics. As an economist, that is my business.

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However, what I believe the noble Earl, Lord Russell, and I have in mind is that in some way we should like the commissioners fully to appreciate the question of absolutely high standards in a world where I fear standards are too often falling, particularly in the intellectual sphere.
6.15 p.m.
Lord Grimond: I wholly agree with what has been said from the Opposition Front Bench. However, I should like to stress what was said earlier by the noble Lord, Lord Morton. In many ways the thing which is most needed in the world today is judgment. How are we to use the enormous resources which science has put at our disposal? How are we to make sense of the battering we take from public relations and so forth? Judgment should be fundamental to universities and it is therefore worth mentioning one of the purposes for which universities exist.
Earl Russell: Perhaps I may respond briefly to the noble Lord, Lord Annan. Had I laid the duty which he discussed on the Provost of University College, I should have created the problems he foresees. However, the amendment places the duty only on university commissioners who will be engaged in investigating university standards. It is concerned only to ensure that they do not dismiss the best people because they are the most expensive and replace them with cheaper ones, and that they take account of the quality of the service provided at the end of the day. I believe that the fears which the noble Lord, Lord Annan, expressed do not bear entirely on the amendment.
The Lord Chancellor: The purpose of the clause is to give a brief reference to the provisions that the qualifying institutions are to be engaged on in relation to questions on procedures for the dismissal of academic staff. The charters, statutes or constitutions of universities are the documents to which one must look to see what is being provided in detail. I should have grave difficulty in believing that one could provide education in any proper sense of that expression which did not include teaching and the exercise of judgment. I should have thought that that is at least one distinction between providing education and simply imparting information.
If one is to detail all the branches which one might hope to cover in proper education, I doubt if one will stop at the exercise of judgment. I yield to no one in my appreciation of the need for the exercise of judgment. Particularly in the office which I presently hold, the exercise of judgment must be absolutely paramount. However, I think that it is denigrating the idea of education to say that it is not complete unless we write alongside it some statement about the exercise of judgment. I should have thought that to put that in would certainly not be an improvement in the circumstances of this clause.
The difficulty about highest possible standards, as the noble Lord, Lord Annan, said, is that they are not practical to apply. All of us aim ourselves, I hope, at the highest possible standards; but sometimes, when we have finished, we think that we have fallen far
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short of them for one reason or another. Nevertheless that is our ideal. It is not in my view a practical formula for the commissioners to have before them. I hope that notwithstanding the desire to attain the highest possible standards the Committee will feel that these amendments should not be incorporated in the Bill.
Lord Morton of Shuna: I do not think that this is the most major item in the Bill. We have had an interesting discussion. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 274D, 275 and 275A not moved.]
Lord Peston Lord Peston moved Amendment No. 275B:
Page 159, line 17, at end insert ("; and

(c) to ensure that, in using the powers established by section 174(1)(a), it shall be the duty of each qualifying institution to demonstrate that there is a genuine need to effect economies, before embarking on any redundancy programme; and

(d) to ensure that there shall in each qualifying institution be procedures to ensure just and fair selection of any person to be dismissed on grounds of redundancy.").

The noble Lord said: This amendment takes us for the first time into the realms of redundancy and resources for higher education. It involves two classes of argument. The first concerns the fear of some academics that universities would engage in what one might call a general blood-letting, endeavouring to make staff redundant in order to replace them with other staff rather than to effect economies because of lack of resources. It is believed by many academics—not least by myself and my noble friends—that that cannot be what the Government have in mind in connection with the work of the commissioners. Therefore we should like to probe to see what the Government have in mind. In order to do that we have put down this amendment.
The second amendment is of equal importance. It brings out a matter on which one ought to reflect; namely, that most of us in the academic world have not had a great deal of experience of the phenomenon of redundancy. Despite the fact that that activity occurs throughout the rest of the economy, I am not persuaded that as a general rule making people redundant is a good thing. This is not a debate on economics, and I shall not enlarge on the general question of policies for full employment and all that kind of thing.
We have not had a great deal of experience of redundancy. It may well be that we shall have to face up to redundancy, both as a consequence of the Bill when it becomes an Act and also because of the continuation of resource pressures on higher education. I do not think that we should under-estimate the extent to which those pressures have been imposed in recent years and the difficulties—and to a great extent the success—of the universities and polytechnics in coping with them. I do not think that we should under-estimate the problems that will arise if we have to face up to redundancy and particularly if we have to face up to the phenomenon known as compulsory redundancy.
Many of us, including myself, have taken voluntary redundancy. I can assure the Committee

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that even that can be psychologically difficult. However, since I have the solace of your Lordships' House I have been able to cope with it fairly easily. Colleagues who have retired prematurely perhaps have not found it so easy. The key issue is that of compulsory redundancy and the need for the commissioners to encourage and indeed make mandatory the fact that selection procedures should be just and fair. I gather that justice and fairness are acceptable words to lawyers; so there is no problem there. To go back to something which the noble and learned Lord the Lord Chancellor said, in these matters we are dealing with specific individuals. It is absolutely vital that such protection is incorporated in the Bill. I beg to move.
The Lord Chancellor: When the noble Lord referred to a later amendment I think he was drawing a distinction between paragraphs (c) and (d) of Amendment No. 275B.
Lord Peston: Yes, I beg your pardon, I was referring to paragraphs (c) and (d) of the amendment.
The Lord Chancellor: These provisions would require an institution to demonstrate that there was a genuine economic necessity before it embarked on any redundancy programme and that the selection of persons for redundancy was fair and just. I would accept that that is in general a reasonable requirement but we are meeting it in a different way under government Amendment No. 279ZAB which we shall come to in due course. The commissioners are already required, in exercising their functions, to have regard to the principles of justice and fairness. They must do just that when they propose modifications to statutes enabling institutions to dismiss staff for redundancy. The commissioners must also establish just and fair appeals arrangements for staff under notice of dismissal or who are dismissed. That should ensure that staff have an effective means of testing the grounds for their dismissal. The removal of the jurisdiction of the visitor to which I referred earlier has the effect that staff would now be able to go to the courts like anyone else.
If government Amendment No. 279ZAB is accepted by the Committee there will be a test of reasonableness along the lines of that in the Employment Protection (Consolidation) Act 1978. That will require the employer to demonstrate that the reason for dismissal may reasonably be treated as a sufficient reason for dismissal. In order for it to be reasonable the procedure for selection for dismissal would have to be reasonable also.
Lord Wedderburn of Charlton: Did I hear the noble and learned Lord say that the employing institutions would have to prove reasonableness under the Employment Protection (Consolidation) Act? Since 1980 one would have thought that the burden was on neither side when one reached that second point.
The Lord Chancellor: Yes, I think that so far as concerns the provisions of the Employment Protection (Consolidation) Act there is no burden at
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that stage. But I think that in practice, applying the provisions that we have here, the appeal procedure would require the employer to demonstrate that the reason for dismissal could reasonably be treated as a sufficient reason for dismissal in practical terms.
At all events the requirement that the person be reasonably selected for redundancy in our submission would already be covered. Therefore, I believe that the safeguards in the Bill, coupled with the amendment which I hope to move shortly, if accepted by the Committee, would provide reasonable and adequate protection for the employee.
Lord McCarthy: It may be argued that what the noble and learned Lord said about the amendment which the Government intend to move— Amendment No. 279ZAB—covers the point in relation to Amendment No. 275B. That is to say, so far as concerns the selection for redundancy the amendment which the Government intend to move is in its own way supposed to cover that point. However, paragraph (d) of Amendment No. 275B proposes that there should be a proper selection procedure. I do not think that what the noble and learned Lord said covers that point.
The noble Lord, Lord Peston, in introducing the amendment, said that a procedure for dealing with redundancy is not very well developed in academic life. That is absolutely true. It derives from the fact that up to now academics have had tenure. The problem is also made more difficult by the fact that the provisions of the Bill, and in particular those relating to redundancy in order to obtain cheaper labour in exchange for more expensive labour, would make most customary methods of dealing with redundancy—"first in, last out"—unavailable. It would not be a very acceptable principle because "first in, last out" would leave all the old men and women who are on the top of the scale. That would not be what the Government want. Therefore the universities will want quite a new and different set of procedures. Maybe the Bill should assist them in that way.
The Lord Chancellor: I quite appreciate that the problems facing a university might be different from those facing some other types of organisation. But I believe the need for the dismissal itself to be just and fair, which is enjoined by the procedures which the commissioners are to determine, has the effect that in a redundancy situation the procedure by which the person is selected for redundancy should be just and fair. The precise way in which it should be done may vary according to the circumstances of the different university institutions. I believe that this matter is sufficiently covered by the provisions which we already have in the Bill.
Lord Peston: I find the reply of the noble and learned Lord somewhat reassuring. We all agree that we must treat academics and indeed everybody else in this context correctly. Having said that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 276 not moved.]
6.30 p.m.
On Question, Whether Clause 173, as amended, shall stand part of the Bill?
Earl Russell: If I said that in rising to speak in defence of tenure I was rising on a forlorn hope, I should be guilty of foolish optimism. But I rise without any hope at all. I speak on this without the support of my noble friends the vice-chancellors, if I may so describe them. They reached an agreement with the Secretary of State which was described by the noble Lord, Lord Flowers, as an acceptable compromise. I understand that by their acceptance they made great gains, whereas we in this Chamber have made very few. This makes one think about the comparative importance of Parliament in our political system. The fact remains that this in many ways is a very bad proposal. There are certain speeches which one cannot fail to make if one is to look oneself in the face again. In that light, I hope the Chamber will forgive me if I speak with somewhat less than my customary brevity.
We have no wish whatsoever to defend and preserve dead wood. That is a useless activity. If it is the wish of the Government to tighten grounds for dismissal, to make quite certain that any incompetent or idle person is dismissed, that I would not oppose. What many people in universities fear is that universities, like the Cabinet, might lose more live wood than dead. I shall deal briefly with what has been known in the other place as the Oxford, East argument. Essentially it is that because tenure exists in some places it has affected the atmosphere and practice of others.
My ultimate comment on the Oxford, East argument is that until about two years ago I did not know that some places did not enjoy full tenure. I supposed it was enjoyed by all. The Oxford, East argument has a parallel which I think the Committee may already have considered. It is the practice of freedom of speech, which depends in many places many thousands of miles away from here on standing orders accepted in the two Houses inside the Palace of Westminster. I remember reading the autobiography of the noble Lord, Lord Caradon, who described attending a village council in Jamaica where he found that in order to ensure fair practice a copy of Erskine May was brought out and laid on the village table. You have there the ultimate extension of the Westminster, West argument.
If freedom of speech in either of these Houses is threatened, many of us will agree that it would also create a risk to freedom of speech in many town halls, party meetings and TV studios throughout the land. The Oxford, East argument is one of substance and one which has been too lightly dismissed.
I also think, delighted though I am by the vote we have had today, that, without a guarantee of proper tenure for those who do their work well, academic freedom cannot be secured. It is not enough that people do not actually lose their jobs; they have to be able to do them without fear. I can understand why in another place they do not find this argument very easy to accept. There, poor things, they are so sadly without tenure themselves. But I speak to a tenured
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Chamber. That has something to do with the widely recognised fact that this Chamber achieves particularly high standards of debate.
In the short time since I came here, I have listened to two speeches which I thought showed rare examples of political courage: that of the noble Lord, Lord Joseph, on the national curriculum, and that of the noble Lord, Lord Chelwood, on the Local Government Finance Bill. I would not insult those noble Lords by saying that they could not have made those speeches in another place. But they themselves might confirm that they would have found them much less easy to make in another place. If that is conceded, that is precisely the point I am making about the relationship between academic freedom and tenure.
It is essential for an academic that he should be able, if I may take a past case, to prove the harmful effects of thalidomide even though his department's main benefactors are Distillers. I know that is inconvenient but that is what we have academics for. To take a hypothetical future case—and I concede instantly that it is hypothetical—should an academic discover in a few years' time that new social security regulations have led to malnutrition, he should be free to publish even though his benefactor should be the Department of Health and Social Security. Under present arrangements, without tenure, he might well hesitate to do so.
An academic should be free, as one described it:
"to spend two years during which it seemed likely that the whole of the rest of my life might be consumed in looking at that blank sheet of paper".
That academic happened to be my father. The book that resulted happened to be Principia Mathematica: I think it is important that he was able to go on hammering at the problem without fearing that he would be dismissed for failing to meet productivity targets.
I also think that tenure is essential as a part of political pluralism. J. S. Mill remarked that, "in any constitution there should be a centre of resistance to the dominant influence in that constitution and I regard it as a fundamental maxim of government".
That is part of the justification of your Lordships' House. It is also part of the justification of academic tenure. In this—and I hope the right reverend Prelates will bear with me in this—we have succeeded, as they have, to some part of the inheritance of the medieval Church; an inheritance which depends on a degree of legal immunity, which depends on some immunity from prevailing values outside. It is an inheritance in which very often the irritating has been the valuable: the sociologists under this Government and the free market economists under a government from the Opposition Benches are an essential part of political liberty, even if there should be certain people who feel the need to accuse them of corrupting the nation's youth. In those situations, it is essential that the employing institution should be able to protect itself by saying to the Government, to the benefactor, and above all to a potentially intolerant public opinion, "I am sorry, I cannot help you. I cannot rid you of this turbulent professor."
It must be admitted that this approach may produce a great deal of rubbish. If so, it will be dealt

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with professionally, slowly but surely. But there is a parallel here to the unfashionable, but I think sound, principle that it is better that 99 guilty men go free than that one innocent man be condemned. That is a legal principle on which I still stand. It is also important to consider that we live in a far more specialised labour market than most other people. The degree of our specialisation is not widely appreciated. If a job were now advertised to teach English history from 1660 to 1832 I should be no more eligible to apply for it than the rawest postgraduate, who would be more suited than me. This means that if one loses one's job one loses one's profession.
I heard recently, in my university and subject, of a young man in his thirties in imminent danger of redundancy because tenure in his institution is weak. He is making no attempt to continue in his profession. He intends to become a property speculator. I do not know about other people but I regard that as a waste.
It is also important to consider that we live in an international market for academic jobs. I came back to this country in 1984. I would not have considered an offer from this country for five minutes had this Bill been law. I was talking recently to a young Cambridge junior fellow. Ten years ago he would have had the brightest academic prospects. We were discussing this clause and he said to me quietly, and with dignity, "I hope you win. I would like to stay in this country." For him it was as simple as that. However, at present, if this Bill goes through I cannot honestly advise him to do so.
The Secretary of State clearly supposes that there is no danger that good academics will lose their jobs. That is a belief which almost no academics share. We are living in a state of financial constraint which means that it is very difficult to continue to employ large numbers of people even of the very highest standards. With the leave of the Committee I should like to refer to a document which arrived on my desk five minutes before I left for the Chamber today.
It is the University College London Bulletin. I think that it will be news to the noble Lord, Lord Annan, because it has only just become public. This concerns one of the three most successful—by the Government's criteria—universities in the British Isles. It states that:
"A new campaign has been launched to persuade members of staff to accept 'early retirement' under the premature retirement compensation scheme (PRCS) 'with an even newer face'. At least sixty are needed by 30 September 1989. If substantial savings are not made by such means, the College will be insolvent by the end of 1989".
That is one of the best and most favoured institutions. That is the background in which the vice-chancellors have agreed to the abolition of tenure. It is a financial situation in which they are desperate to be able to dismiss people—and I entirely understand why. However, the reason which makes the proposal attractive to the vice-chancellors, even if only as a second best, is precisely the one which makes it unattractive (to say no more) to the rest of the academic community.
6.45 p.m.
Lord Annan: I have very great sympathy with what the noble Earl has been saying. Despite all their difficulties, I think that the vice-chancellors perhaps gave way a little too easily on this question of tenure. I have always felt that it was reasonable to give people who were devoting their lives to the study of sometimes very abstruse and difficult subjects, the study of which does not qualify them for any other profession or activity, security of tenure for a certain number of years. I believe that the right number of years is between the ages of 35 to 60 with a possible extension after the age of 60. However, one has to remind oneself what has happened in recent years, and why a situation arose which I think was an abuse in our universities.
If we go back to the 1920s and 1930s one had to wait for dead men's shoes in order to obtain a post. Some of the most brilliant people in Cambridge had no opportunity of having a tenured post. They would be there as assistant lecturers if they were lucky, sometimes as probationary lecturers, and sometimes even with no appointment except a college fellowship. They would hope that somebody in their subject was going to retire. I trust they never hoped that somebody was going to drop dead. But that was the only way in which they could obtain an appointment, and some hung on by one means or another until a post became vacant.
After the war, with the expansion of the universities, this changed. Cambridge maintained its old procedure in which you were first an assistant lecturer for five years with no guarantee of tenure after that. It was perfectly honourable to lose your position. If you were appointed a university lecturer, you were then appointed for three years on probation, even after those five years. You then had tenure: that is to say, although your lectureship was still on a five-year basis, it was then totally understood that this was a convention and that, subject to anything going wrong with you physically or mentally, you were in until the retiring age, although of course you hoped to be promoted to a higher grade. That was the position at Cambridge.
It was not the case, however, in the vast majority of universities in this country. In the civic universities you were sometimes appointed—and this became quite common in the late 1950s and certainly in the 1960s and 1970s—at the age of 25 after you had taken your PhD, and sometimes before, to a lectureship on a probationary basis for three years. In practice that was probation for two years, because in the third year you were being judged as to whether you should continue. Therefore you were in with hardly any probation. You then were established with tenure. It was true that, if you did not fulfil your promise, you could be held at the bar after, I think it was, five or six years. That meant that you could not have further increments on your stipend. People were very rarely held at the bar. Indeed, if you were held at the bar for any length of time you could guaranteee that the branch in your college or university of the Association of University Teachers would immediately begin agitating and saying that it was totally unfair that this young man should be held at

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the bar and denied the increments to which he was entitled.
And so it came to a point where people were appointed at the age of 28 until the age of 67 and it was this inflexibility which the Government encountered when in the 1980s they wanted to reduce government expenditure on higher education. It cost the Government enormous sums of money—millions and millions of pounds to break the contracts of staff who had to be made redundant so that the universities should be solvent. Of course they were not made redundant. They were offered early retirement and it was on such terms that the Government had to pay out.
I say this with great regret to the noble Earl, but that is why we are faced with this situation today. I think it is a grave mistake. I believe that we ought to have tenure in universities between the ages of 35 or thereabouts and the age of 60. That gives one flexibility in terms of the young who may have to be told that there is no further job available and that they must look elsewhere. At that stage they are young enough to look elsewhere. But in the case of the noble Earl, who has spent his life as a most distinguished historian, researching into early 17th century English history, it is extremely hard to see quite why somebody in that position, particularly given the distinction of people of that rank—scholars such as the noble Earl—should not be given tenure.
I shall not vote for the abolition of this clause. I think it should stand part. I believe that would be, if I may put it this way, a wrecking amendment, but I feel that I should say what is in my heart in support of the noble Earl.
The Earl of Halsbury: I agree with every word spoken by the noble Earl, Lord Russell, on the subject of academic freedom. The Motion before us is that Clause 173 stand part of the Bill. I believe that we should try as far as possible not to have Second Reading debates on clause stand part. They protract our proceedings indefinitely, however interesting the noble Earl, Lord Russell, and my noble friend Lord Annan were. I shall express myself as content that Clause 173 stand part of the Bill.
Lord Peston: I fear that I shall offend the noble Earl, Lord Halsbury, because I too take the question of tenure fundamentally seriously and this seems to be the clause under which I can debate it. In order to say that I do not want tenure abolished, my best method is to say that I do not, want the commissioners brought in to abolish it. Thus with due apology I am afraid that I too am about to make a long speech, but it is my only opportunity. I promise not to make another when I have finished it, but tenure is as important to me as perhaps some other aspects of the Bill are to members of the Government. I hope the Committee will bear with me, but I wish to say this once and it is important.
The noble Earl, Lord Russell, referred to his father—a man whom some of us hold in higher esteem than perhaps any other person in this century. But he did not remind the Committee that his father
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managed to be dismissed at least twice, if not more; so the question of tenure is certainly not a triviality.
There is no need for me to repeat the basic arguments which essentially are to do with the quality of academic work—the kind of remarks that the noble Lord, Lord Annan, has made. Also, I do not want to suggest to the Committee that some of us may have been given tenure too easily. I certainly became a professor as a very young man because there were not many economists around to make professors and there were professorships to be filled. I could never have competed with the great men of Cambridge in the 1930s where I would have stayed as assistant lecturer for a great many years.
I must tell the noble Lord, Lord Annan, that I do not want to go back to the 1930s and all those days. I believe that academics deserve a reasonable deal and reasonable careers. I do not regard it as unreasonable that not much above average academics should end up as professors, so I do not apologise even if we did it a little too easily.
Tenure in that sense is enormously important. Before making one or two economics points, my other point is that I must emphasise the enormous success of our university system. I again ask the Government what they think they are up to. We have here a university system which is admired throughout the world. The cost per graduate in our country is low, both internationally and historically. That at least ought to appeal to the Government. We in higher education have coped for the moment with real financial constraints. I am very much with the noble Earl, Lord Russell. I am not convinced that we shall continue to cope and I await to see which of our institutions will be the first to go bankrupt. I shall be interested as a social scientist, in a rather ghoulish sense, to observe the process of bankruptcy because it is not something that we have observed up to now and as scientists we should have an open mind about such matters. But I do not look forward to that in any way whatsoever. It is a dangerous state of affairs.
We have coped with financial crisis. Our productivity as conventionally measured has risen more rapidly than the boasts made about manufacturing industry in this country. We hope we have maintained quality, although I cannot be certain of that any more. Certainly those of us who carry on as academics are determined to maintain quality. Our research output by world standards is prodigious, as is our scholarship. I hope to hear no noble Lord denying that because that is regarded as fully accepted throughout the world.
Above all, I quote the noble Lord, Lord Ashby, who said that the academic profession in Britain is probably more dedicated to teaching and more successful in its dedication than are academics elsewhere. Therefore I believe that what the Government are up to is wrong anyway because there is no problem that is not there to be solved. But there can be no doubt that the abolition of tenure clauses are meant to be used, because although the orange book of notes does not carry the force of law I take it that its explanatory paragraph was meant to reveal to us what the Government have in mind.

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The Government say that these modifications to the terms of employment of academic staff will enhance a university's capability to reallocate resources to meet changing needs. The Government's policy is that universities should not be prevented from dismissing academic and related staff on grounds of redundancy, and so on. In other words, these clauses are not being introduced as minor clauses. There is no need for the noble and learned Lord the Lord Chancellor, who will no doubt reply for the Government, to say "Do not worry". The clauses are there to be used and we have to recognise that.
The key point I wish to make is that tenure has an economic function. First, the academic world is no longer a British world. It is not even a European world. It is the world. Academics are now highly mobile. They are bid for all over the place and they move from place to place. Therefore in terms of the best academics the situation is not very different from the best footballers or anything else. They will go where the conditions are best, where the working conditions in particular are best. They will go where they are wanted and they will certainly go where they are better paid. In terms of tenure what we ought to bear in mind is that our main competing nation, the United States of America, offers tenure contracts. Tenure is taken extremely seriously in that country. Tenure is not given easily, but it is given and it is certainly maintained.
I was amused by the remarks of the noble Lord, Lord Annan, about no tenure beyond 60. Some of my former colleagues at Princeton had tenure to 65. They then retired from Princeton. They moved to some of the great universities of the west and far west and were reappointed to tenure contracts to the age of 70, often at enormous salaries. The point about those institutions, if one were to say that only governments can do that, is that I am referring to the great private universities of America. They offer tenure contracts. They are the institutions which will be recruiting our best people and we have to respond to that. It is not just a matter of principle. It is a matter of straightforward, excellent economics.
The other key economics point is that if tenure is not offered the academic career becomes more risky. Clearly it does. If it becomes more risky one must pay the people who take those risks, because that is a straightforward elementary proposition of economics. Academics must bear such risks and their salaries must be raised pari passu.
The advantage that tenure has given to this country—and I speak as someone who believes that he has been treated in this way, as have other academics—is that we work for much less than our market value in the outside world. The reason we do so, other than our dedication to the work, is that we are bearing a good deal less risk. I do not doubt that. However, I cannot see why the Government should suddenly wish to re-introduce a risk element, which would achieve one of two things: either the salary of appropriate academics must be raised quite drastically or one must make do with inferior academics. I know that people will say that I am parti pris. However, our academics are first-class and we meet the market test. People continually come to us
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to ask us to work for them, and I believe that to be as good a test as any.
That is the ground that I wish to cover. I believe that the Government have made a mistake. I am not saying that it would not be appropriate to tighten the rules on granting tenure, but that there should exist within higher education the possibility of a fully tenured contract, as the noble Lord, Lord Annan, said.
7 p.m.
Lord Annan: Can the noble and learned Lord clear up one point? I have discussed the matter outside the Committee with the noble Lord, Lord Peston. He is probably right and I am almost certainly wrong. Is there anything in the Bill which prevents a university from saying to a distinguished American academic, "Come and join us. We will give you tenure to the retiring age"? I do not believe that there is. However, he would be perfectly all right provided that the department in which he worked was not decimated or reduced and redundancies made.
I can see no reason why one cannot give tenure to specified people on one's staff provided that the whole lot are not granted tenure. One would then be in trouble financially because it would be necessary to break the contract. However, provided that one believes that one is unlikely to break the contract, is it not possible to give someone tenure under contract to the retiring age? I am probably wrong.
Lord McCarthy: Will the noble Lord accept that in that case it would be very likely tenure? It would not actually be tenure because you could not guarantee that subsequently you would not have to take it away.
Lord Annan: I do not see why you should take it away, if I may say so. I can see no reason why it should be taken away.
Lord Wedderburn of Charlton: Will my noble friend who is still being asked questions, not agree that the tenure that was granted would be a tenure with the university being statutorily enabled to dismiss for redundancy whenever it liked?
Lord Peston: I am sorry; I did not realise that the Committee allowed any other noble Lord to answer questions. My concept of tenure is not being able to be fired for redundancy.
The Lord Chancellor: I believe that the question was directed to the noble Lord before he sat down, in the accustomed way. As regards the point raised by the noble Lord, Lord Annan, Clause 174(1)(a) requires that the statutes of the university should have inserted in them a provision enabling an appropriate body, or any delegate of such a body, to dismiss any members of the academic staff by reason of redundancy. In other words, if the university was hit by hard times it would be possible to dismiss anyone, subject to the scheme if it existed.
I believe I am right in saying that in some situations tenure is described even though it has that quality. In other words, tenure is sometimes spoken of in

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circumstances where people can have recourse to due process and there is a situation in which you can be dismissed but you can do nothing about it. I believe than tenure is referred to in some quarters when, instead of being dismissed summarily in that way, one has the right to a process which tests the reasonableness of one's dismissal. In any case, what we are now discussing is tenure of a character which does not permit the institution to dismiss by reason of redundancy.
The difficulty is that if the university or other institution is met by changed economic circumstances it is hoised by those circumstances if all its staff have tenure. It makes it very difficult for the institutions to reallocate their resources to meet changing patterns of needs because staff cannot be dismissed even where they are redundant; in other words, when the university can no longer afford to employ them.
If a university is faced with that situation it must instead rely on voluntary early retirement to induce staff to leave their tenured positions. The resulting pattern of staff changes is unlikely to match the real needs and interests of the institutions. Staff who are willing to leave or accept early retirement are often those with the best prospects of employment in industry and other places—I need not specify—and they are the kind of people whom universities may well wish to retain. However, universities may be obliged to release them in order to achieve inescapable staff reductions. I believe I am right in saying that in some institutions increasingly short-term appointments are being offered and that cannot be a good arrangement. This provision is designed to overcome the difficulty of tenured positions in such universities.
Our belief is that in the circumstances of changing economic conditions it is right to give universities and other institutions to which the provisions apply the possibility of accommodating themselves to the changed economic circumstances by declaring academic staff redundant. That is subject to the safeguards of Clause 173, which provides for the appointment of commissioners to write in to the governing constitution of the various institutions. As the noble Lord, Lord Peston, said, Clause 173 relates to that issue and not directly to redundancy. However, the Government believe it to be right that universities should have that flexibility. They believe that it will be used properly and that it will be subject to very reasonable safeguards. I hope that the Committee will agree that Clause 173 shall stand part of the Bill.
Earl Russell: I recognise the force of the argument put forward by the noble and learned Lord as regards changing economic conditions. However, in the interests of the academic it is not sensible to accept employment under those terms. I believe that if the clause is passed we shall not fill our posts.
It is not only a matter of dismissal but also of length of service. Now few academics are appointed before the age of 30; many are appointed a good deal later. If one retires at 55 then one does not have much to retire on. Part of the situation is that it is a job in
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which only one person in a million can be reemployed after dismissal. In this context and for that reason I argue for greater security when it is available in places elsewhere. Nevertheless, I shall no longer oppose the Question that Clause 173 shall stand part of the Bill.
Clause 173, as amended, agreed to.
Schedule 9 [The University Commissioners]:
[Amendments Nos. 276A and 276B not moved.]
Baroness Darcy (de Knayth)Baroness Darcy (de Knayth) moved Amendment No. 276BA:
Page 199, leave out line 28.
The noble Baroness said: I mentioned this group of amendments when speaking to an identical amendment to Schedule 5. I should like to thank the Government for indicating that they are willing to accept the amendment. I beg to move.
The Earl of Arran: Once again we are happy to accept the amendment.
On Question, amendment agreed to.
Baroness Darcy (de Knayth)Baroness Darcy (de Knayth) moved Amendment No. 276BB:
Page 199, line 29, leave out ("otherwise").
On Question, amendment agreed to.
The Earl of Arran: This might be a suitable moment at which to break for dinner. I therefore suggest that we do not return to the Committee stage of the Bill until 8.10 p.m. I beg to move that the House do now
resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Control of Misleading Advertisements Regulations 1988
7.10 p.m.
Lord Beaverbrook Lord Beaverbrook rose to move, That the draft regulations laid before the House on 23rd March be approved [21st Report from the Joint Committee].
The noble Lord said: My Lords, I beg to move the Motion in my name on the Order Paper.
If approved, the proposed regulations (together with the Financial Services Act, which I shall come to later) would implement the Council Directive 84/450/EEC (the misleading advertising directive). The regulations would be made under Section 2(2) of the European Communities Act 1972. In the most general terms, the directive requires member states to ensure that they have adequate and effective means for the control of misleading advertising, to protect consumers, other businesses and the general public. In particular, these means of control must include measures for the legal prohibition of misleading advertisements.
The directive defines both "advertising" and "misleading advertising" very widely, and this is

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reflected in the definitions in Regulation 2 of the draft regulations. The draft regulations do not, however, reproduce Article 3 of the directive, which sets out an illustrative list of examples of information which should be taken into account in determining whether advertising is misleading. The Joint Committee on Statutory Instruments has drawn your Lordships' attention to this omission, which is a deliberate omission and not an oversight. In the Government's view, the list is unnecessary. We consider that it does not add anything and, in practice, may even serve to narrow the interpretation of misleading advertising in the United Kingdom to a degree not intended by the directive. We have therefore not included it.
Member states are required by the directive to provide arrangements enabling any person or organisation, regarded under national law as having a legitimate interest in prohibiting misleading advertising, to initiate legal proceedings against such advertising or to bring it before an administrative authority. An administrative authority must be competent either to decide on complaints or to initiate appropriate legal proceedings. The Government propose to entrust this competence to three named administrative authorities: the Director General of Fair Trading; the IBA; and the Cable Authority.
The principal authority would be the Director General of Fair Trading. Regulation 4(1) would put him under a duty to consider complaints and Regulation 5(1) would empower him, if he thought it appropriate, to apply to the High Court or, in Scotland, the Court of Session for an injunction or an interdict.
The duty to consider complaints would be subject to two qualifications. The director would not be required to consider a complaint if he considered it frivolous or vexatious. More importantly, he would be able to require complainants to satisfy him that they had exhausted the established means of dealing with complaints. In effect, this would be a discretion to refer complainants to other bodies. The main bodies would be the Advertising Standards Authority and the trading standards departments of local authorities. He would however be able to refer complainants to other bodies as appropriate in relation to particular complaints.
To enable him to fulfil his functions, Regulation 7 would give the director a power to require information to be supplied to him, in particular to ascertain whether or not factual statements in an advertisement were true. Failure to comply with a notice from the director requesting information could be followed by an order from the court, on the application of the director, requiring the default to be made good.
The Joint Committee on Statutory Instruments has also drawn your Lordships' attention to this provision, which it says appears to make an unexpected use of the powers conferred by the statute under which the regulations are to be made. My Lords, the Government appreciate the valuable work done by the joint committee and are grateful for its vigilance. But we do not share the joint committee's view on this occasion. The power of the director is necessary (and not merely desirable) for those cases
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where the evidence as to whether or not an advertisement is misleading is uniquely in the possession of the advertiser. In order to be able to act swiftly and effectively, in the interests of both consumers and rival advertisers, the director needs a power to obtain this information. Two memoranda have been submitted to the jont committee to which the department explains in some detail how the taking of the power in Regulation 7 is within the powers conferred by Section 2(2).
In the case of broadcast advertising and advertising transmitted by a licensed cable service, the administrative authorities would be the Independent Broadcasting Authority and the Cable Authority respectively. Both are already competent to decide on complaints. The IBA may, if it considers an advertisement to be misleading, refuse to broadcast it. The Cable Authority may, under Section 15(1) of the Cable and Broadcasting Act 1984, issue a cable operator with a direction not to transmit a particular advertisement. In the event of a cable operator failing to comply with such a direction, the Cable Authority already has the power to revoke the cable operator's licence.
In implementing the directive, we propose to allocate responsibilities between administrative authorities primarily on the basis of the medium carrying the advertisement. There would however be one sectoral division. Investment business advertisements issued by or on behalf of a person authorised under the Financial Services Act 1986 or the appointed representative of such a person would be excluded from these regulations. Implementation of the directive in this sector would be achieved by the provisions of that Act and the administrative authority would be the Secretary of State or any person to whom he had transferred relevant functions under the Act. In practice that would mean the Securities and Investments Board.
My Lords, these regulations, if approved, would be a valuable addition to our already extensive regime of protection against misleading advertisements. Moreover, they would achieve this in a way that created no new criminal offences for traders; did not impose burdens on business; did not undermine the established means; imposed a negligible cost on the public purse; and afforded responsible businesses protection against unscrupulous competitors. In short, this measure is good news for both consumers and business, I commend it to your Lordships' House. I beg to move.
Moved, That the draft regulations laid before the House on 23rd March be approved [21st Report from the Joint Committee].—(Lord Beaverbrook.)
Lord Williams of Elvel: My Lords, the House will be grateful to the noble Lord, Lord Beaverbrook for introducing these regulations. We note that this is yet another example of regulations introduced under the European Communities Act 1972, as a result of directives promulgated by the Commission. I have to say to the noble Lord that the regulations are of such substance that in other circumstances they would form the object of a Bill in your Lordships' House, and indeed in another place. However, we have to accustom ourselves to dealing with measures of this

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nature resulting from the European Communities Act in the manner which is prescribed; that is, by regulation.
In principle we have no objections to the control of misleading advertisements. It would be wrong for anybody to have objection in principle to that control. I note the noble Lord's comments about the Joint Committee on Statutory Instruments which has expressed some doubt about the regulations. There are some worrying points to which I should like to draw attention.
Regulation 2(1) is the interpretation section. It is quite clear in that it refers to the IBA and the reception and immediate retransmission of broadcasts made by the IBA. Of course, it does not refer to the BBC, but there could be a future occasion when the BBC is entitled and wishes to make advertisements. Furthermore, it does not refer to direct broadcasting from satellites where the jurisdiction is, at best, doubtful. It would be a very odd business if the IBA were constrained from allowing to be broadcast advertisements which are misleading while consumers whom the noble Lord is trying to protect—we appreciate that—can receive satellite broadcasts outside the jurisdiction of the IBA, the BBC or anybody else. I should be grateful if the noble Lord could comment on that.
In Regulation 2(2) the expression "likely to deceive" gives me some problems. I do not know how the courts would interpret the expression "likely to deceive" in respect of an advertisement. I can understand the concept of an advertisement deceiving a person but I find it difficult to see how the courts could decide whether an advertisement was "likely to deceive". However, I have no doubt that the noble Lord has an answer since I gave him notice of the problems I wished to raise. I am sure that he will be able to satisfy me on that point.
Regulation 2(2) contains the expression:
"an advertisement is misleading if … it is likely to affect their economic behaviour".
I do not understand the expression "economic behaviour". I understand economic theory and have learned about it but "economic behaviour" is a very wide expression. I can rise in the morning and make a telephone call which costs me money; that is economic behaviour. How the courts will say that an advertisement which may or may not be deceptive or may or may not be likely to deceive affects my economic behaviour I find very difficult to see. I hope the noble Lord can help on that.
Regulation 3 deals with advertisements under the Financial Services Act. I appreciate the noble Lord's remarks about the regulations under the Financial Services Act being much more stringent in their effect than the regulations which the noble Lord is now introducing. Nevertheless, the question arises: how do the regulations under the European Communities Act, which the noble Lord is introducing, march with the provisions of the Financial Services Act and regulations derived from that Act? How do we tell which advertisement, misleading or otherwise, is subject to the Financial Services Act and its subordinate legislation and which advertisement is
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subject to those regulations following slightly different rules and slightly different control?
Regulation 4 deals with complaints to the director. I assume from the context of the regulation that when it talks about,
"the complaint appears to the Director to be frivolous or vexatious"
the director is acting within the law and will be subject to judicial review if it is felt that the director is behaving unreasonably in saying that a particular complaint is "frivolous or vexatious". I should be grateful if the noble Lord could confirm that.
Regulation 4(4) introduces quite a different and major point. I believe it is for the benefit of the House if I read it out:
"In exercising the powers conferred on him by these Regulations the Director shall have regard to (a) all the interests involved and in particular the public interest; and (b) the desirability of encouraging the control, by self-regulatory bodies, of advertisements".
That raises the whole question of what is the public interest and which particular definition of the public interest the director is to have regard to when he looks at complaints about advertisements. It will not come as a surprise to your Lordships that over the past few months I have been inviting the Government to define what they mean by the public interest.
It is defined in different categories in different statutes. Perhaps I may give one rather way-out example. The Airports Act 1986 instructs the Monopolies and Mergers Commission to investigate matters concerned with the public interest where referred to the commission. Section 43(5)(b) of the Act instructs the commission:
"in the case of a matter relating to the granting of a right by virtue of which any operational activities relating to an airport may be carried on by any person or persons, shall in addition have regard to the following objectives, namely, the furtherance of the reasonable interests of persons granted such rights".
That is a statute definition of the public interest to which the Monopolies and Mergers Commission is to have regard. If misleading advertisements about which there may be complaints to the director concerning concessionaires in airports, who would normally fall under the provision, are referred to the Monopolies and Mergers Commission and require to be judged by the commission under Section 43 according to the public interest criteria which I have spelled out, it would be very odd if the director were to apply other public interests criteria.
In Section 84 of the Fair Trading Act the director has quite separate public interests criteria which we have discussed many times in this House. I do not wish to spell them out again. However, it seems to me that the public interest here is simply slipped into a regulation without any definition about which particular statute should override the regulation when the public interest is considered by the director.
Regulation 5 deals with applications to the court by the director. The director is entitled to apply to the court to bring proceedings for an injunction and may also apply to an interlocutory injunction. However, there is no provision for what the director should do if the advertisement has already appeared and has misled certain people. All that he can do is to stop the advertisement appearing in future. Perhaps the Minister would clarify what powers of redress the

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director or anyone else has for those who have been misled by that advertisement.
Regulation 6(2) introduces in my view two rather dubious expressions. First, it says:
"likely to convey a similar impression".
In order not to mislead your Lordships, perhaps I should read out Regulation 6(2), which relates to the functions of the court:
"An injunction may relate not only to a particular advertisement but to any advertisement in similar terms or likely to convey a similar impression".
I have no idea what that means in practical life. I shall be grateful if the Minister can explain it.
Regulation 6(5) says:
"The court shall not refuse to grant an injunction for lack of evidence that … the person responsible for the advertisement intended it to be misleading or failed to exercise proper care to prevent its being misleading".
I ask again: what happens if the person responsible for the advertisement did not intend it to be misleading and indeed exercised proper care but, for reasons quite outside his control, as we know from the Financial Services Act 1986 and derived legislation and practice thereunder, it turned out to be misleading? As the noble Lord will remember, Section 27 of the Act employs the word "recklessly" to the effect that the person is reckless as to whether it creates a misleading impression. There is a difficulty, to which I have referred, about whether the regulation marches with the Financial Services Act.
In Regulation 8, dealing with complaints to the IBA, paragraph (1) simply says that the IBA shall consider any complaint, and so on. It continues:
"The IBA shall give reasons for its decisions".
What decisions? So far as I can see, no decisions are mentioned in the regulation. If there are no decisions, what kind of reasons will be given? If there are decisions, what are they and what kind of reasons should the IBA give, how they should be justified and how should they be considered? Should they be considered as being reasons that can be taken to the court on judicial review? If the IBA is required to give decisions and these are up for judicial review, it introduces quite a novel procedure which, so far as I understand it, does not apply to the Press Council or to the Advertising Standards Authority at present.
Regulation 8(3) says:
"In exercising the powers conferred on it by these Regulations the IBA shall have regard to all the interests involved and in particular the public interest".
What is the public interest? Which definition of public interest are we going to adopt? The same comment applies to Regulation 10(3), under which the Cable Authority is required to have regard to the public interest. I should like to know where the Cable Authority derives its definition of public interest.
Certain points of detail—not of principle, because we are grateful that the regulations should be made and that we have to follow the European directive—need due consideration. I have spelt them out to the Minister. I gave him notice of what I intended to say. I hope that he will come with a good and satisfactory reply.
7.30 p.m.
Lord McGregor of Durris: My Lords, I thank the Minister for his exposition of the regulations. I do not intend to take up the time of the House beyond stating my interest in my capacity as chairman of the Advertising Standards Authority.
I wish to make one straightforward point. The Director-General of Fair Trading has already emphasised publicly that his new powers were,
"intended to support and reinforce the existing controls, not to replace them".
Accordingly, the Advertising Standards Authority will remain the central independent and self-regulatory institution for enforcing the British code of advertising practice in print, poster and cinema advertising. However, the new long stop power of the Director-General of Fair Trading, which was first recommended after an inquiry in 1979, will be valuable in certain circumstances. I am glad that the regulations will not affect the present machinery, which is efficient, effective, quick, accessible and cheap. It makes no use of lawyers or courts, and it costs the taxpayer nothing. Once the regulations have been approved, the Advertising Standards Authority will work closely with the Office of Fair Trading to ensure its further effectiveness.
Lord Beaverbrook: I am grateful to the noble Lord, Lord Williams of Elvel, for having given notice of what he intended to ask me. First, he asked what would happen in the event of the BBC at some time in the future taking advertisements. There are now a few BBC advertisements carried on BBC I and BBC2; for example, for Radio Times and other publications of the BBC. Any complaints would be dealt with by the director-general. If the BBC were to carry more extensive advertising at any time in future, the arrangements would have to be reviewed to decide what procedure would be appropriate.
As to satellite advertising in this country, I understand that purely domestic transmissions will be covered by the director-general, but problems arise in regulating broadcasts that do not emanate from within these shores. Transfrontier satellite broadcast services will have to be dealt with by international agreement. A broadcasting directive and a Council of Europe convention are being negotiated. I cannot claim that this is an easy matter to solve, but we are mindful of it.
I turn to Regulation 2(2). The noble Lord asked the meaning of the expression "likely to deceive". The regulation enables the director general, the IBA or the Cable Authority to take action without having to show that someone actually has been deceived. They will need to take a view as to whether a reasonable person was likely to be deceived. This expression gives the relevant authority the ability to take action without having to prove that someone has been deceived.
The noble Lord, Lord Williams, asked what is meant by the expression "economic behaviour" in Regulation 2(2). The simplest way to answer him is to give an example. Economic behaviour refers to where someone is persuaded to buy something as a result of a misleading advertisement. This is distinct from an aspect of an advertisement which would affect some other kind of behaviour—social behaviour and so on.

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Here we are dealing with where someone is persuaded to go out and buy something.
Lord Williams of Elvel: My Lords, I do not expect the noble Lord to answer now, but I wonder whether he could write to me to say where and when in any other statute the expression "economic behaviour" has been used, and what was the definition employed in that statute.
Lord Beaverbrook: My Lords, I cannot answer the noble Lord's direct question but I understand that the wording is taken from the EC directive. I shall look into it further and let him have the results of my research.
The noble Lord's next point concerned the Financial Services Act. He will know better than I that there is a separate and special regime covering all aspects of financial services, including advertisements. We consider that the relevant provisions of the financial services legislation will have the same effect in respect of misleading advertisements. Rules made under the Financial Services Act make the necessary provision in respect of investment advertisements by authorised persons and their appointed representatives.
The Act and the rules do all that is necessary to implement the directive in that area. I do not see any useful purpose in duplicating those provisions in the regulations. Where a firm or person authorised under the Financial Services Act advertises for staff and so on, it may well be that any misleading advertisement would come under the area dealt with by the director general rather than necessarily by the SIB or any other person appointed under the Financial Services Act.
The noble Lord asked me the meaning of the expression "frivolous or vexatious" where the director general finds that a complaint is not to be treated seriously. The director general needs to be protected from having to spend his resources on dealing with such complaints. Although it is up to him in the first place to make that decision, no doubt his decision could be subject to judicial review. There is certainly a point there.
The expression "public interest" is never an easy matter in your Lordships' House. The noble Lord, Lord Williams, and I have participated in debates on many Bills where the expression "public interest" has arisen in different contexts. I am sure the House will forgive me if I do not attempt this evening to give a statutory definition of the term. I see the noble Lord, Lord Mishcon, on the Opposition Front Bench. I am sure that he will agree with me that this term is used often but has generally been left to the courts to assess what is meant by it. I understand that the courts are well versed in this area.
In this case the director general would probably not regard it in the public interest to seek an injunction in the case of an advertisement which had finished and which he knew would not be repeated. It would be waste of his time, probably a waste of money from the public purse, a waste of the court's time, and therefore would be against the public interest.
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The noble Lord, Lord Williams, mentioned the meaning of the expression "public interest" under Section 43 of the Airports Act. The expression appears in many statutory provisions but no statute overrides Regulation 4(4)(a) since it implements Article 4(2) of the Community directive. The directive does not define the expression but I understand that the courts are well practised in interpreting the expression. It would not be appropriate in regulations of this kind to gloss the expression even if a wholly satisfactory definition could be formulated. The joint committee would no doubt comment adversely on any such attempt, and quite rightly so.
Lord Williams of Elvel: My Lords, this is an important point as I am sure the noble Lord recognises. Am I to understand from what he said that the courts are to be the arbiters of public interest under this regulation, and that they will be required to disregard the public interest definitions in statutes such as the Fair Trading Act, the Airports Act, the Gas Act and so on, and simply decide in their own wisdom what under this regulation the public interest means?
Lord Campbell of Alloway: My Lords, the answer to that is probably yes, because the ultimate arbiter on a matter of interpretation under Article 177 is the European Court of Justice. Within the Community context, perhaps the answer is yes.
Lord Beaverbrook: My Lords, I am grateful to my noble friend. That probably is the case. The courts would come to a decision and I understand that they are well versed in that. It is a complicated area but at the end of the day it is up to the courts to come to their own conclusion on this matter.
The noble Lord, Lord Williams, asked what other remedies may be available, as any injunction taken out by the director general, the IBA or the Cable Authority will only stop the offending or misleading advertisement. That is the purpose of the regulations. The purpose is not to punish offenders. There is criminal legislation for that. The purpose is to secure the cessation of the misleading advertisement as soon as possible. The director general will be able to act quickly when necessary.
The role of the trading standards officers will continue as before. They will have the responsibility for the enforcement of a whole range of criminal legislation relevant to advertising, in particular the Trade Descriptions Act. They do an extremely important job and they and the Advertising Standards Authority already successfully deal with the great majority of complaints about advertising. The regulations will not change that but will merely provide an extra means of dealing with those few complaints which cannot be dealt with otherwise. The director general will in effect act as a long stop rather than as one of the principal players.
The noble Lord, Lord Williams, asked me about the meaning of the expression "likely to convey similar impression". It was included necessarily to avoid advertisers escaping from an injunction just by making minor changes to an advertisement or by

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switching from one medium to another. That is the purpose of the expression.
The noble Lord, Lord Williams, asked me what effect the absence of an intention to mislead would have on the obtaining of an injunction. I understand that any absence of intention is irrelevant in the same way as is an absence of damage caused to the complainant. However, in the Trade Descriptions Act any possible defence is probably on a higher level and there is a defence in that Act—if a matter under such regulations reached the stage where there was a criminal prosecution—of due diligence and of taking all reasonable precautions.
I turn now to the subject of the IBA and the decisions that it would have to make under the regulations. I understand that in normal circumstances the IBA would have to give its reasons for its decisions to the complainant in writing and would probably publish its decisions, as is the present situation. No doubt if the IBA did not carry out its statutory functions correctly it could be challenged under judicial review procedures.
In answer to the noble Lord's final question on the subject of the IBA, I suggest that in the context of the regulations the decisions referred to in Regulation 81 are quite clearly decisions to take or not to take action in relation to a complaint about a broadcast advertisement. I think that what I have said answers the noble Lord's question on that point.
I am grateful to noble Lords for their contributions to these discussions and I am sorry that I have taken some time to answer the points that were raised. However, they are important points and I trust I have been able to clarify the position. I commend the regulations to the House.
Moved, That the draft regulations laid before the House on 23rd March be approved [21st Report from the Joint Committee].—(Lord Beaverbrook.)

Malicious Communications Bill
7.53 p.m.
Lord Campbell of Alloway: My Lords, I beg to move that this Bill be now read a second time.
The Bill comes from another place, where it was introduced by my honourable friend Mr. Andy Stewart. It is based upon the 1985 Law Commission report on poison pen letters. It creates a new offence in any one of a quadruplicate set of circumstances.
Where any person sends to another person, with intent to cause distress or anxiety, a letter or other article such as, for example, a tape or computer software which conveys:

(i) a message which is indecent or grossly offensive;

(ii) a threat; or

(iii) information which is false and known or believed to be false by the sender; or

(b) any other article which is, in whole or part, of an indecent or grossly offensive nature.
there is the commission of the new offence.
Sending articles in that context, with each of those quadruplicate set of circumstances, includes delivery and causing to be sent or delivered. The offence is liable summarily; the maximum penalty is a fine of
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£400; the Bill would come into force two months after its enactment in England and Wales and may become effective in Northern Ireland by Order in Council, subject to annulment by resolution by the House. The state of the law in Scotland—this will be no surprise to your Lordships—is such that it is really quite unnecessary and not appropriate that the Bill should apply to Scotland.
In the case of a threat used to enforce a demand, if the sender shows that he believed that there were reasonable grounds for making the demand and that he believed that the threat was a proper means of reinforcing that demand, then no offence is committed. However, subject to that exception, the criminality resides in the action, irrespective of whether it causes distress or anxiety—a matter which was discussed in another place.
A further matter that was discussed in another place was whether, in context with threat, "reasonable belief' was appropriate. However, the test is not "reasonable belief', but belief that there were reasonable grounds—which is not quite the same thing, although both are subjective.
In the other place the question arose as to whether the test should be subjective or objective. That was a matter upon which my honourable friend Mr. Patten gave an assurance that attention should be paid to that question in your Lordships' House, if your Lordships were so advised.
In a sense, the new offence fills a gap between nuisance telephone calls—which were an offence under Section 43(1) of the Telecommunications Act 1984—and an offence under the Post Office Act Section 11(1)(c), which only applies when material is sent, or is attempted to be sent, by post. Of course there is a possible element of overlap between that offence and the new offence. Indeed the term "indecent" in Clause 1 overlaps to some extent with the term "grossly offensive". However, both terms are used in the analogous offences under the Telecommunications Act and the Post Office Act to which reference has already been made, and so far this has not given rise to any difficulties.
It is right that your Lordships should know that although the Bill is based upon the Law Commission Report it departs from it in six significant ways: the penalties are reduced; the burden of proof that a threat was warranted is now upon the defence; the protection is now afforded even wider to include third parties; the offence now includes causing to be sent or delivered, thereby widening the ambit; the "reasonable excuse" defence has been wholly excised; and there is the enabling clause as regards Northern Ireland.
The hope must be that this modest, non-controversial measure may commend itself to your Lordships as reasonable, timeous and requisite. I beg to move.
Moved, That the Bill be now read a second time—(Lord Campbell of Alloway.)
8 p.m.
Lord Mishcon: My Lords, as one would expect of the noble Lord, Lord Campbell of Alloway, he has moved the Second Reading of the Bill with great

497
clarity. It is an important little Bill. I suppose that if we were to try to describe the practice of sending poison pen letters we might shortly describe it as cruelty anonymous. It is in that atmosphere that I rise to support, in a general way, this measure. As the noble Lord, Lord Campbell of Alloway, said, there is a gap in the law. There is a gap between criminal libel, for example, which I do not think he mentioned, and the other statutory offences.
Criminal libel will not cover a case where nothing defamatory is said but something offensive, something menacing is said. Furthermore, in most cases one would have to prove that a breach of the peace was apprehended as a result of any criminal libel; and so there is no doubt that there is a gap in the law. One passes an Act of Parliament hoping that one will mitigate to some extent the horrible practice of sending poison pen letters or sending articles. Articles have a very broad meaning, the precise nature of which I do not intend to detail to your Lordships. However, your Lordships have sufficient imagination to know what might and does occur offensively through letter-boxes in various circumstances.
The fear is of course that one passes an Act of Parliament with good intent but one knows in one's heart of hearts that the number of cases that one will ever be able to bring are few, by virtue of the fact that cowardice is the spirit usually lying behind poison pen letters. The result is that the person who writes them is usually untraceable, though the person who puts something through the letterbox may conceivably he traceable.
One then turns to the question of whether one should have an Act of Parliament when one has not proved to the satisfaction of Parliament that the practice is so widespread that it deserves a legislative measure. Your Lordships may be interested to know that in a similar obnoxious practice relating to offensive and indecent telephone calls Parliament was informed that above 500 cases are reported every day, including Saturday and Sunday. So one can imagine that the number of poison pen letters of the kind that we are describing in the legislation is pretty prolific.
One then wonders why there has not been an outcry; why it is that there are not more attempts at prosecution. I am afraid the answer is that many people have to be informed by lawyers whom they may consult that at the moment there is no way in which a prosecution can be brought, even if the person can be indentified. There is the gap that the Bill fills.
The only other comment I have to make is that having said that it may be difficult in many cases to prosecute and that we are legislating here with the knowledge that we possess as ordinary folk; that this cruel practice is prevalent, even if we cannot prove the statistics; knowing that we are going to legislate through this measure, the next question—it is the final one with which I deal—is: are we being consistent in regard to the penalty exacted under the Bill?
The noble Lord, Lord Campbell of Alloway, mentioned the fact that the penalty provided in the Bill is not the same as was recommended by the Law
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Commission in the draft Bill which it appended to its report. The penalty there, as I remember it, was £200 with a possibility of imprisonment. I think that I am right in saying that. The penalty under the Bill is £400: that is, scale 3 as against scale 5.
If one tries to have a little consistency, I am afraid that I have to remind your Lordships of something that happened in your Lordships' House. I do so because I believe that as a result of what happened we should be careful when we come to examine the question of penalty. Perhaps your Lordships will forgive me if I quote from paragraph 4.55, on page 30 of the report, which states:
"In regard to the suggestion for amending section 43(l), we have noted that Parliament recently had the opportunity of increasing the maximum penalty under it".
That is Section 43(l) of the Telecommunications Act 1984. We were dealing in the House on that occasion with the penalty to be exacted in respect of that section.
The report continues:
"In the House of Lords a backbench amendment to the relevant clause in the Telecommunications Bill would have provided a maximum penalty of six months' imprisonment for the offence as an alternative to a line. During the short debate on the amendment, concern was expressed by its proponents about the large number of reported cases of nuisance telephone calls (some 500 each day) and the fact that many of these calls had a terrifying effect on the, often lonely, people who received them. In opposing the amendment, the Lord Advocate said that, because of the width of the offence, mans of the cases brought under it were petty cases for which it would be undesirable to send offenders to prison. He also drew attention to the offence proposed in our working paper"—
that is the offence with which we are dealing under the Bill—
"for dealing with the sending of grossly offensive communications and suggested that it might be better to await the outome of our review before proceeding. Consequently the amendment was withdrawn and the maximum penalty remains a fine of only £400".
I remind the House of that point because the noble and learned Lord the Lord Advocate was expecting us, when we dealt with legislation of this kind, to have that debate in mind and to look at the question of consistency of penalty. How inconsistent it is! I gave that instance to remind your Lordships.
I now turn to paragraph 2.7 of the report, which deals with the offence under Section 11 of the Post Office Act 1953,
"for any person to send indecent or obscene material through the post".
We are reminded in the report that the maximum penalty on summary conviction for that offence is a fine not exceeding £2,000. On conviction on indictment, the court may order imprisonment for a term not exceeding 12 months in addition to imposing a fine. That is for the offence of sending indecent or obscene material through the post.
We are in danger of being completely inconsistent when that is the penalty for committing those offences under the Post Office Act while we are saying that the sending of poison pen letters, if their author is discovered, charged and convicted, cannot be sentenced to any term of imprisonment and is subject to a maximum fine of only £400. If we are really trying to deter these people from doing this obnoxious thing, it seems to me we not only need to have a proper deterrent and consider that very carefully but we must also be consistent in regard to

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our penalties. Otherwise we are doing something a little irresponsible. Subject to those comments, I support the Second Reading of this Bill.
The Parliamentary Under-Secretary of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington): My Lords, I wish to congratulate my noble friend Lord Campbell of Alloway on taking up this Bill and bringing it forward for the consideration of this House. The Government offered this Bill their full support during its passage through another place and we intend to offer similar support in this House.
This is a difficult area in which to legislate. One does not wish to catch the robust expression of sincere opinion, nor does one wish to bring the criminal law into trivial private quarrels carried on in correspondence. What my noble friend and I want to do is to penalise those who set out to wound others by sending them harmful matter. My noble friend's Bill steers a careful course through this difficult territory. I believe that this Bill will make an important addition to the criminal law. It clearly struck a chord with all parties in the other place. I believe it will strike a chord with noble Lords in this House. It tackles behaviour which is clearly criminal and provides an effective penalty and an effective deterrent. It is an admirable and necessary Bill. It has the Government's wholehearted support and I hope that noble Lords will have no difficulty in giving it a Second Reading.
Lord Mishcon: My Lords, before the noble Baroness sits down. I wonder whether, having heard my speech, she would care to alter what she said? Perhaps she might say that her noble friend and the Opposition, as well as herself, supported this Bill.
Baroness Trumpington: Gladly, my Lords.
8.11 p.m.
Lord Campbell of Alloway: My Lords, though I shall he brief there is no disrespect or want of sincerity in what I have to say. I am extremely grateful to the noble Lord, Lord Mishcon, for his erudite and most constructive contribution. I think that the noble Lord accepts that, in accordance with the Law Commission report and our own knowledge of life, the practice is so widespread as to warrant legislation.
The point that the noble Lord makes on consistency of penalties is a very serious, well thought out and important one. It may well be that this matter will have to be considered at a later stage of the Bill. I say no more about it at this stage, where we are dealing with points of principle. I am extremely grateful to my noble friend the Minister for her support and for the remarks she made.
Before concluding, I wish to congratulate the draftsmen on having produced a Bill where the precision of the draftsmanship is matched by the clarity of expression. It is an intelligible Bill. I also wish to acknowledge the work of the Law Commission and of course the initiative of my honourable friend Mr. Andy Stewart and the help I have had personally from the Home Office with the
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preparation of these documents. I respectfully ask that this House give the Bill a Second Reading.
On Question, Bill read a second time and committed to a Committee of the Whole House.

Education Reform Bill
House again in Committee on Schedule 9.
8.15 p.m.
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 276C:
Page 200, line 32, at end insert—
("9. The Commissioners shall submit an annual report to Parliament.").
The noble Lord said: In speaking to this amendment, I shall be speaking also to Amendments Nos. 279CA and 279E in the name of the noble Lord, Lord Allen of Abbeydale, which are also in this group.
Amendment No. 276C is intended to add to Schedule 9 an obligation on the commissioners to submit an annual report to Parliament. Amendment No. 279CA is to add to Clause 174 the same obligation in rather fuller language:
"The commissioners shall make an annual report to a Select Committee of both Houses of Parliament appointed for the purposes of this Act on their proceedings, and the Select Committee shall lay the annual report before Parliament with such comments (if any) as they think fit".
If I may say so in anticipation of the remarks of the noble Lord, Lord Allen of Abbeydale, he continues the progression of this group and his amendment is rather longer even than my second amendment.
These amendments are directed to the problem that the commissioners are exercising a power to secure that the statutes of each qualifying institution have the various provisions enumerated in Clause I 74. This necessarily entails that there should be alterations to the statutes and ruling documents, if I may take it in that wide sense, of the various universities. Some of these are Acts of Parliament, some of them have other bases. But it is appropriate that if there is to be this power to secure change, the exercise of the power should be supervised by Parliament or at least watched by Parliament and commented on. It is with that intention that these two amendments, to which my name is attached along with that of the noble Lord. Lord Grimond, are put down. I beg to move.
Lord Allen of Abbeydale: I have great sympathy with the amendments just moved by the noble Lord, Lord Morton of Shuna, more particularly because in my Second Reading speech I recommended that what is proposed should be done.
I invite the Committee to look for a moment at my Amendment No. 279F on page 12 of the Marshalled List. It is quite long. I have put it down in genuine puzzlement as to the precise effect of the Bill as it stands on relations between the findings of the commissioners and the supervision of Parliament. Let me make it clear that I am not suggesting anything with the desire of holding things up. The procedure is complicated enough already and can

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take some time. The idea of having commissioners is presumably modelled on the two Acts of 1877 and 1923 applying to Oxford and Cambridge and the 1898 Act applying to London. On that occasion there was a universities committee of the Privy Council and there was provision that they resolve any dispute and that amendments which they had agreed to or other non-controversial ones were laid before Parliament and could be prayed against.
What happens this time? The position is different in that we now have the Department of Education with a direct interest in universities. That used not to be the case. It is a procedure which to my mind will affect all universities and not just those which happen to have tenure. When I asked a question on this the other day, the noble Baroness, Lady Hooper, said that the staff of the Privy Council Office and the DES saw no difficulty in coping with the trickle of submissions which would come in from the commissioners over a period of three years. It sounded as if the Privy Council Office, which is very tiny, would be operating as little more than a post office and that this time it would in practice fall to the officials of the DES to sit in judgment on the commissioners' findings. But it is what happens next that I find rather puzzling. Clause 175(6) says as regards the findings of the commissioners:
"No instrument made in the exercise of the Commissioners' powers … shall have effect unless it has been approved by Her Majesty in Council".
Clause 178 hides behind a marginal note, which states:
"Power to make incidental, etc., provisions by Order in Council".
The clause states:
"Her Majesty may at any time by Order in Council make such incidental, consequential or supplementary provision as appears to Her necessary".
for the purposes set out.
Clause 178(2) states:
"An Order in Council under this section may in particular amend, repeal or revoke … any provision
of—
(a) an Act passed or a charter granted … before the passing of this Act".
As the university statutes will in future cover grievances and appeals procedure, the chances are that the provisions of pretty well every university will have to be amended, certainly the Act affecting Royal Holloway and Bedford New College with which I have some concern will have to be amended.
Clause 192(4) concerns a statutory instrument. We now have a statutory instrument appearing on the scene. The clause states:
"(4) A statutory instrument containing—
(a) an Order in Council made under section 178 of this Act … shall be subject to annulment in pursuance of a resolution of either House of Parliament".
I of course am not used to dealing with Acts of Parliament and I may be quite wrong, but does this very complicated jigsaw mean that in practice every amendment of every statute of every university, whether the statutes are made under charter or under an Act of Parliament, is to be the subject of Orders in Council which can be prayed against? If that is right, would it not be more sensible to say so in terms perhaps on the lines of my amendment rather than let
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the whole structure rest on a clause which according to the marginal note confers a power:
"to make incidental, etc., provisions"?
If I am wrong and the jigsaw does not mean this, my amendment speaks for itself as setting out something that ought to be done.
The Lord Chancellor: Perhaps it might be wise for me to start by saying what I understand the procedure to be. The commissioners' powers are set out in Clause 175. They:
"may make such modifications of the statutes of any qualifying institution as they consider necessary or expedient … No instrument made in the exercise of the Commissioners' powers under this section shall have effect unless it has been approved by Her Majesty in Council".
So in the ordinary case of statutes which are not Acts of Parliament the commissioners' powers may be exercised, and once approved by the Privy Council no further procedure will be required.
If however something further is required—something that requires a fuller exercise than a mere exercise of the commissioners' powers—Clause 178 is intended to deal with that. It states:
"(1) Her Majesty may at any time by Order in Council make such incidental, consequential or supplementary provision as appears to Her necessary or expedient—

(a) for the general purposes or any particular purposes of any exercise of the Commissioners' powers under section 175 of this Act; or

(b) in consequence of any exercise of those powers or for the purpose of giving full effect to any such exercise".

That is to say that if something appears to be necessary to be done which is not contained within the powers of the commissioners under Clause 175, it does not mean that it could not happen at all. It means that in that situation where something further is required it may be done by Order in Council. When an Order in Council is carried out and that includes the situation in which an Act of Parliament is itself to be modified, the necessary procedure is that which is set out in Clause 192(4). My understanding of the position is that in the ordinary course the only procedure that would be required is for the Privy Council to give effect to the exercise of the commissioners' powers.
Where something more than a mere exercise of the commissioners' powers is called for falling within Clause 178, that may be done by Order in Council, but an Order in Council is:
"subject to annulment in pursuance of a resolution of either House",
as provided in Clause 192(4).
Lord Allen of Abbeydale: In view of the changes which have been made to the Bill since it was first introduced, does not that mean that in practice nearly every case will come within Clause 178 in that it is not just talking about an Act of Parliament but also about charters?
The Lord Chancellor: Clause 178 is only required if something more than an ordinary exercise of the commissioners' powers is required. The commissioners' powers are referred to in Clause 175. That may be sufficient in most cases, but the exercise

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of their powers may throw up some other expedient change which flows from what they have done. In that case the powers under Clause 178 would be exercised and in such a case the parliamentary procedure is open.
I think that the answer to the noble Lord's last question is that in many cases the commissioners' powers would be sufficient to deal with the matter without the need for Her Majesty to go on to exercise powers under the Order in Council. For example, a good number of the institution statutes at least are contained not in the charter but in statutes passed by virtue of powers contained in the charter. In that situation the statutory instrument is not required as regards Clause 175. It would only be required if power to do something more was necessary under Clause 178. I think that that is the correct position. I am taken up with answering the question but I must now go on to deal with the amendment.
I shall take the amendment of the noble Lord, Lord Allen of Abbeydale, first. In the light of what I have sought to explain, the noble Lord's amendment is perhaps not appropriate. As regards getting the commissioners to report to Parliament I do not know what the purpose of that is. The powers that they exercise become effective as changes only when approved by the Privy Council. The matters will become public property very quickly—they are all references to public documents or to the university. I cannot imagine why there should be formal reports to Parliament. The powers are fairly strictly defined.
The powers in Clause 178 are subject to parliamentary control and I should have thought that a report to Parliament in the way proposed in the amendment of the noble Lord, Lord Morton of Shuna, was inappropriate. Perhaps I should also say, just in case anyone thinks I have forgotten, that among the precedents followed by having commissioners are of course the commissioners who were appointed under the University of Scotland Act.
8.30 p.m.
Lord Morton of Shuna: I have never heard Parliament disposed of quite so summarily. We are discussing a group of five people who will change statutes and even Acts of Parliament. It will then report to the Privy Council which is not the most public organisation in the world in its considerations. Nor does it represent every branch of opinion. Those are very important powers. They are powers which the universities and many others are concerned should be exercised strictly within the limits and not exceeded. I should have thought that it is eminently reasonable for Parliament to have some supervisory role in deciding whether or not those powers are being properly exercised. Otherwise, what is the purpose of having a Parliament?
Lord Allen of Abbeydale: The noble and learned Lord said that in the light of his explanation I am wrong about the charters. He said that my amendment is uncalled for. I take a different view. I think that his explanation has made it more important in that, contrary to my own amateur view,
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there is no routine procedure for Parliament to exercise any control over the changes. My amendment suggesting that they should be laid before Parliament has an even stronger claim for consideration than I had realised.
The Lord Chancellor: The powers that Parliament is giving to the commissioners are fairly closely defined. There has to come a stage at which the business stops. The noble Lord complained about the complexity of the procedure and he now seeks—perhaps it is unfair to say that, because it is on a slightly different footing—to add another stage. If the powers are sufficiently clearly defined, as I believe they are, then it is appropriate that the Privy Council should be the body to deal with those matters.
The noble Lord, Lord Morton of Shuna, says that the Privy Council is not the most public body that was ever invented. The fact that it is called the Privy Council would suggest just that. However, it is the body that grants charters and it seems appropriate that it should have a role. It is important that if something is required beyond a mere change of university statute Clause 178 should come into play and parliamentary procedure should be invoked.
The minor matters are left to the Privy Council, which I should have thought was implicit in what was said earlier. It is right that that should be so. It is not correct that nearly every case will require parliamentary scrutiny under the provisions, as the noble Lord first said. I believe that it is right that not every case should demand parliamentary scrutiny. Only where the powers required under Clause 178 are invoked is parliamentary scrutiny necessary. Reporting to Parliament would be an inappropriate stage in that procedure. If there was to be any parliamentary control at all, it would be in the nature of what is provided in Clause 192.
However, there must come an end to supervision or we shall have supervisers supervising supervisers almost ad infinimm. I suggest that the procedure which is set out is a reasonable one for the comparatively subsidiary role which the commissioners will have in adapting what Parliament has laid down in the principle Bill, if it is passed, to the constitutions of individual universities or other institutions affected.
Lord Morton of Shuna: I regret to say that I do not find that satisfactory. We have gone through this Bill, as we have gone through others, with the Government saying that the powers given to do this or that shall be by order, or that without even the necessity of an order the Secretary of State shall make up his mind. It seems to me that the alteration of statutes is important and that Parliament has a different and more important role which should be recognised. I intend to press the amendment.
8.35 p.m.
On Question, Whether the said amendment (No. 276C) shall be agreed to?
Their Lordships divided: Contents, 45; Not-Contents, 59.

DIVISION NO. 2

CONTENTS

Adrian, L.

McNair, L.

Airedale, L.

Morris of Kenwood, L.

Allen of Abbevdale. L. [Teller.]

Morton of Shuna, L.

Mountevans, L.

Ardwick, L.

Nicol, B.

Blackstone, B.

Ogmore, L.

David, B.

Peston, L.

Dean of Beswick, L.

Pitt of Hampstead, L.

Dormand of Easington, L.

Ponsonby of Shulbrede, L. [Teller.]

Elwyn-Jones, L.

Ely, Bp.

Russell, E.

Ewart-Biggs, B.

Seear, B.

Falkland, V.

Serota, B.

Grey, E.

Shepherd, L.

Grimond, L.

Sherfield, L.

Hatch of Lusby, L.

Stewart of Fulham, L.

Hereford, Bp.

Swann, L.

Hylton, L.

Tordoff, L.

Jeger, B.

Turner of Camden, B.

Kearton, L.

Underhill, L.

Lockwood, B.

Wedderburn of Charlton, L.

London, Bp.

Williams of Elvel, L.

Longford, E.

Winchester, Bp.

McCarthy, L.

NOT-CONTENTS

Aldington, L.

Hives, L.

Arran, E.

Hooper, B.

Ashbourne, L.

Jenkin of Roding, L.

Bathurst, E.

Johnston of Rockport, L.

Beaverbrook, L.

Lindsay, E.

Beloff, L.

Lindsey of Abingdon, E.

Belstead, L.

Long, V.

Blatch, B.

Lucas of Chilworth, L.

Brabazon of Tara, L.

Mackay of Clashfern, L.

Brougham and Vaux, L.

Margadale, L.

Caithness, E.

Mersey, V.

Campbell of Alloway, L.

Monk Bretton, L.

Carlisle of Bucklow, L.

Munster, E.

Carnegy of Lour, B.

Nelson, E.

Carnock, L.

Northesk, E.

Cowley, E.

Pender, L.

Craigavon, V.

Reay, L.

Cullen of Ashbourne, L.

Redesdale, L.

Davidson, V. [Teller.]

Renton, L.

Denham, L. [Teller.]

Skelmersdale, L.

Dormer, L.

Swinfen, L.

Eden of Winton, L.

Swinton, E.

Faithfull, B.

Teviot, L.

Ferrier, L.

Torphichen, L.

Gray, L.

Trafford, L.

Greenway, L.

Trefgarne, L.

Grimston of Westbury, L.

Trumpington, B.

Halsbury, E.

Wise, L.

Henley, L.

Young, B.

Hesketh, L.

Resolved in the negative, and amendment disagreed to accordingly.
8.42 p.m.
Shedule 9 agreed to.
Clause 174 [Duty of Commissioners]:
[Amendment No. 277 not moved.]
The Deputy Chairman of Committees (Lord Renton): If Amendment No. 277A is agreed to I cannot call any of Amendments Nos. 277B to 278C inclusive.
Lord Peston Lord Peston moved Amendment No. 277A:
Page 159, line 36, leave out paragraph (a).
The noble Lord said: Amendment No. 277A is grouped with Amendment No. 279ZD, in the name of the noble Baroness, Lady Seear, and the noble Earl, Lord Halsbury, and Amendment No. 279ZE, in the name of the noble Lord, Lord Pender. It is somewhat arbitrary that I speak first because it seems to me that the subsequent amendments are rather more to the point than my own. However, if I briefly say what I think the point is I can then sit down.
These amendments do what I argued earlier we need to do. They enable the institution to offer—subject to very stringent conditions which can be discussed in detail if the amendments are passed—what I would call a tenure contract. The noble and learned Lord the Lord Chancellor made clear what he thought constituted a tenure contract in this context. That is also what I think a tenure contract is, so we have no difficulty on that issue. The amendment seeks to enable such a contract to be one of the possible contracts that a university or college could offer to its staff. That is my interpretation of the amendments and that is what I seek to draw to the attention of the Committee. I beg to move.
Baroness Seear: I should like to support the amendment. In our view it is very desirable. I do not want to repeat the arguments that were put forward earlier during the discussion of the question of tenure. However, it should be possible for institutions to offer genuine tenure to people they wish to attract and to hold. That is essential, in our view, if the standards of universities are to be maintained.
The arguments have been rehearsed at considerable length in connection with an earlier amendment. I merely wish to say that I hope the Committee will agree that this is a way of satisfying the Government's desire that universities should not be landed with near universal tenure while at the same time giving those institutions the possibility to recruit and retain the people they really need if the standards of universities in this country are to be maintained.
Lord Pender: I should like to move Amendments No. 279ZE to 279ZAB.
The Deputy Chairman of Committees: The noble Lord cannot move any other amendment at this moment. He can refer to it.
Lord Pender: The purpose of the amendment is to make provision for American-style contracts following the practice of the great American private universities such as Harvard, Massachusetts Institute of Technology, Princeton and Yale. Despite the fact that the US academic labour market is highly competitive those institutions take tenure very seriously indeed. However, tenure can be broken for poor performance or where an entire department or university is to be closed, but for no other reason.
Broadly similar arrangements exist throughout the remainder of the English-speaking world. Those arrangements are designed to protect the individual

507
from harassment while at the same time providing the necessary flexibility for restructuring of universities in accordance with changes in demand. This amendment is designed to achieve a similar end.
Staff who move or who are promoted in the United Kingdom in circumstances which involve loss of tenure or who leave tenured positions overseas to accept employment in a UK university could be offered this type of tenure. They could then be dismissed in three situations: first, for good cause; secondly, because the department to which they are attached has to be closed; and, thirdly, because their employing institution is to be closed.
The arrangements in the Bill will inhibit movement. This amendment creates more managerial flexibility. It is also fairer to existing staff in that it reduces the extent of retrospective change in their conditions of employment.
The Earl of Halsbury: In view of the ruling from the Chair that if noble Lords see fit to agree Amendment No. 277A it will not be possible to call Amendments Nos. 277B, 278A or 278B which stand in my name, I think the Committee should know that those amendments were drafted by your Lordships' petitioners. I think that it would be wrong to silence them.
Lord Swann: I should like to make one small point. I am well aware of the complexities and difficulties of the tenure problem. It has not existed for all that long in the cast-iron way in which it exists in some universities at present. Indeed, it exists only in some universities and not all. On the other hand, if things go as planned in the Bill, universities will have a rather considerable internal injustice because tenure has an actuarial value. We shall end up with people who have tenure because they have been in post for a while, and others who have been appointed more recently or have been promoted and do not have tenure. There will be a situation—unless the Government do something about adjusting salaries—where people doing the same job are on a different contract or a different salary. That is already giving rise to a good deal of unease.
I do not know whether that is a situation which would justify an approach to the European Court of Human Rights. I know that such cases take a long time. It has been suggested to me by a distinguished lawyer that it could. That is a small point which I wished to add to the debate.
The Lord Chancellor: The amendment moved specifically by the noble Lord, Lord Peston, in effect takes away the possibility of having untenured positions. That is really the point we debated in respect of whether Clause 173 should stand part of the Bill which could have been the place for this argument if it was wanted.
The other amendment which has been mentioned in this grouping is the amendment of the noble Lord, Lord Pender. This amendment proposes to produce the situation where, say, a university offers a particular member of the academic staff—
Baroness Seear: I am sorry to interrupt the noble and learned Lord. I think I am at fault in that, when I was speaking, I thought it was understood that because it was in the grouping I was speaking to the amendment in my name, that is Amendment No. 279ZD. I should have said specifically that I was speaking to that amendment in the same way that the noble Lord, Lord Pender, said he was speaking to his amendment.
The Lord Chancellor: I am very grateful to the noble Baroness. I take these two amendments together as both propose in slightly different ways that the universities should be able to offer tenure in respect of particular appointments. The difference between the amendment of the noble Baroness and the noble Earl, Lord Halsbury, and that of the noble Lord, Lord Pender, is that the latter would allow dismissal on the ground of closure either of the department or the whole institution. If such a drastic situation should occur, it seems necessary that something of the kind should be provided.
Perhaps the problem is best put this way. If some new posts are tenured and some are not, this would accentuate the problem to which the noble Lord, Lord Swann, drew attention. Perhaps this is the best place to deal with that point briefly. People who have tenure up to 20th November last year will retain it. The Government announced their proposals and any contract which was entered into after that time is not to have the possibility of tenure attached to it assuming that the Bill remains in its present form. The noble Lord, Lord Swann, points out that that creates a difference between new people and old people. But there is often such a difference.
The terms available may change with the passage of time; this is just a particular example of that. I do not think it would be contemplated as possible to remove tenure from people who held it before the intimation was made that this was proposed. Either one retains the pre-existing situation or one has to have some very elaborate provisions for compensation if one is not to proceed on the basis that some of the new people will not have tenure but the people who were in the post before will. There are certain modifications of that which I need not mention in detail, such as going up the scale. If all one is doing is going up the scale on which one was serving, that is not a new appointment for this purpose and one would continue to have tenure.
As I say, to go along with these amendments would introduce the further possibility of injustice between the different members of the universities' staff. However wise one is, it is not easy to foresee the future. There is always therefore a possibility that the university or institution in question might be faced with a situation in which it was highly desirable to depart from a particular aspect of its activities. This would not necessarily mean the closing down of a department and precisely what was involved might not be clear. But it could become necessary for the sake of financial effectiveness to reduce the university staff. One cannot know that with any degree of confidence a long time in advance. Therefore, I feel unable to accept these amendments.

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I can see the attraction but I believe that the amendments would introduce a still greater sense of injustice than the one to which the noble Lord, Lord Swann, referred. And they would not properly reflect the fact that the universities might have to deal with different situations to those they anticipate at the time of making appointments. I invite the Committee not to accept the amendment which has been moved or the other amendments which have been spoken to.
Baroness Seear: It is with the greatest trepidation that I challenge the noble and learned Lord the Lord Chancellor on the question of justice. However, it seems to me a little odd, coming from their Front Bench, that the Government should oppose on the grounds of justice the award of tenure which may very well be regarded as a merit award or an incentive to good performance. I had understood that the Government were pressing for that in almost all areas of employment. Why is a particular accolade an advantage not be be given to a highly sought-after academic when in all other fields of work—the Civil Service and elsewhere—the Government are urging awards for people who are showing exceptional merit. It seems to me totally inconsistent.
The Lord Chancellor: I do not think many members of the Civil Service are accoladed with tenure; certainly certain offices are not. The question is whether that particular form of accolade is the appropriate one. At the very best the accolade must reflect something about the person up to that point. Tenure looks forward and those with the best possible reputations—
Baroness Seear: I am sorry to interrupt the noble and learned Lord. The whole point of what we are proposing is that when there are people of exceptional ability who have proved over a period of time, by their research, publications, and distinguished academic work, that they are people whom the university wishes either to attract or retain, what on earth is the difference between that and saying that in other fields of work you give some additional benefit or reward to people who have shown exceptional ability? I cannot see the difference.
The Lord Chancellor: I am sorry if the noble Baroness cannot see the distinction between the accolade of tenure which after all is a rather rare accolade and other forms. It seems to me to be a perfectly reasonable distinction. I do not see why in this field new distinctions between the available accolades should be introduced. Once the 20th November has come—
Lord McCarthy: Is the noble and learned Lord suggesting that into academic life would be introduced the general policy in relation to pay: that one should have merit rates, special payments for extremely distinguished people over and above the scale, and improvements in pay rather than improvements in job security? Is that the alternative accolade?
The Lord Chancellor: It is certainly a possible alternative accolade. People who do well in academic life sometimes become professors. That is a very large accolade. Occasionally, they become vice-chancellors and principals and so on. There are all sorts of accolades available by which to distinguish people. Why choose this particular one which makes it impossible to take account of changes of circumstance afterwards? I can see that there are distinctions between people in respect of their history on appointment, but not many people can foretell the future completely. Therefore, it is in respect of lack of flexibility in the future that I say tenure is an unsuitable accolade. I hope the Committee will agree with me.
Lord Peston: Perhaps I may say to the noble and learned Lord that I find his answer extremely unsatisfactory. He does not seem to grasp what we are talking about. We are discussing the recruitment of academic staff. To a large extent we have accepted the Government's view that the means of recruitment have been excessively rigid. We are suggesting that there be a range of contracts from short-term contracts for short-term purposes, longer term contracts and the tenured contract. That is a range of possibilities I should have thought we could trust the academic institutions to decide upon in order to recruit staff in the appropriate way. That is what we are arguing.
Recruitment of members of staff on this basis corresponds to what the academic institutions want. It also corresponds to the available market price of a person concerned. It is preposterous to suggest that universities will suddenly be free to bid much larger salaries for people. It seems reasonable, as the noble Baroness, Lady Seear, says, on the Government's own view of the way the world works. If the Government will not accept our view, I should like an explanation why some of the greatest universities in the world— private and state universities—offer the precise contract which the noble Lord, Lord Pender, pointed out. I believe that the Committee deserves a reasoned answer from the noble and learned Lord.
We were hoping for elucidation. We were certainly not hoping to divide on this matter. However, I should like to hear again from the noble and learned Lord some argument on what we are talking about.
9 P.m.
The Lord Chancellor: I regard myself as having addressed the matter about which we are talking. I understand the point. Perhaps the noble Lord will at least agree with that. Whether this is an appropriate form of distinction is the question. Some forms of distinction are appropriate, I agree. I think that I am right in saying that merit awards of pay are in place in at least some universities. I know of one university where I learned something about the possibility of discriminating in pay between different members of the university. And a fairly invidious job it was found to be. However, it is a possible way forward. The advantage is that it is more flexible than accolade or awards of tenure.
Tenure, once awarded, by its very nature is a very long-term factor. That distinguishes it from the

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short-term contract. The effect is to tie the universities' hands for a fairly long time into the future. That is the reason against it that I offer to Members of the Committee. It seems to me to be a reason.
Earl Russell: Perhaps I may ask the noble and learned Lord the Lord Chancellor to address the question that has been raised several times this evening; that of attracting people back from the United States. The noble and learned Lord asks: why this accolade? The answer is that people with American appointments in good universities certainly will not come anyway near this country without it.
The Lord Chancellor: That is a forecast. I believe that there are attractions in this country for some academics that would be sufficient to draw them back without the necessity of that security.
Baroness Seear: The noble and learned Lord is talking about the Government's beliefs. Although we are very interested in beliefs, we wish to know the evidence for that belief.
The Lord Chancellor: It is difficult to give evidence about what will happen in the future, which is what the noble Earl is talking about. If the noble Baroness can indicate that, it would be helpful. The best I can do is to suggest that the mere fact that there is no tenure does not mean that no people of academic distinction will wish to take positions in the academic life of this country. I do not believe it for a moment.
Earl Russell: With respect. I was not talking entirely about the future. I was talking about the decision that I took in the very recent past and the ground on which I took it.
Lord Wedderburn of Charlton: Perhaps I may make this brief point. There are already two known cases of distinguished academics who have have been offered chairs in this country and have refused to come because of the implications of this Bill.
Lord Beloff: Perhaps I may intervene. I am a little worried about certain points that have been made from the Benches opposite. In the first place there has been some exaggeration of the degree to which tenure is applied in American universities. To the best of my knowledge the formula of' the American association of universitiy professors recognises the subordination of tenure to—I think they call it—programmatic exigencies. That is to say, it is not proof against major changes in university policy whether or not induced by financial stringencies.
My other point is this. If it were so serious a blow to the possibility of recruitment, I should have expected the vice-chancellors and principals to have asked us to look at this. In fact there has been no pressure whatever from the vice-chancellors and principals to preserve tenure. They, after all, are as much as anyone concerned with the points that the noble Earl, Lord Russell, has made.
Earl Russell: Perhaps I may cursorily answer the noble Lord, Lord Beloff. In the present financial circumstances vice-chancellors are very rarely recruiting anybody. They are living from hand to mouth. The time may come when recruitment may resume.
Lord Peston: I do not wish to prolong this discussion. I am deeply disappointed with the answer of the noble and learned Lord. I believe that this is a matter worthy of more serious discussion. We shall return to it on Report. However, at the moment I beg leave to withdraw the amendment.
Amendment, by leave withdrawn.
The Deputy Chairman of Committees: I have to point out that if Amendment No. 277B is agreed to I cannot call Amendment No. 278.
The Earl of Halsbury The Earl of Halsbury moved Amendment No. 277B:
Page 159, line 36, leave out ("or any delegate of such body").
The noble Earl said: With the leave of the Committee, I should like to speak also to Amendment No. 279ZA, which Members of the Committee will find at the top of page 8 of the Marshalled List. Noble Lords will find 10 amendments altogether standing in my name and that of the noble Baroness. I ought to explain that she and I were joint practitioners in launching a petition in your Lordships' House at the start of' proceedings on this Bill, signed by no less than some 6,400 academics representing at least 25 per cent. of the total academic population of our universities, a not unnotable percentage for a petition which had been organised at rather short notice.
When I had laid the petition on the Table, the petitioners asked me what would become of it. I said, "Nothing, unless you can embody your petition, which is in very general terms"—of which I shall remind Members of the Committee in a moment —"in some amendments which I can approve sufficiently to propose them to the Committee."
These are the first two. The effect of the two amendments taken together is to ensure that decisions about dismissal of academic staff shall continue to be taken by the appropriate body within the institution and where appropriate in accordance with the disciplinary procedures establised within the institution and that dismissal powers shall not be delegated to subordinate officials. That seems to me to be a reasonable proposal by way of an amendment and I submit it for the Committee's jurisdiction.
I shall not unduly preoccupy the Committee's time because the hour is late. If I may have a fair comment from the noble and learned Lord I shall be content to withdraw the amendment for the time being. I beg to move.
Lord Adrian: Amendment No. 278 is brigaded with Amendment No. 277B and I wish to speak to it, but at the same time, if I may, I shall also speak to Amendment No. 279 because those two amendments in my name have a certain symmetry. Clause 174(1)(a) concerns redundancy and arranges that dismissal for redundancy should be by a body or a

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delegate of that body. Clause 174(1)(b), which concerns dismissal for good cause, provides that dismissal shall be by an officer or his delegate. In the notes it is suggested that in general the officer who is charged with dismissing for good cause would in general be the vice-chancellor.
The effect of the two amendments, Nos. 278 and 279, would be to give discretion to the commissioners to consider the circumstances as they find them in any individual university and to make a judgment as to whether dismissal for redundancy should be by a body or an officer; and indeed exactly the same for dismissal by good cause, and whether that should be by a body, an officer or their delegates.
This seems to me to achieve merely a sensible flexibility on what the commissioners are charged to do in the light of the circumstances that they find in any particular university. But if the original clauses are based on some principle—perhaps that vice-chancellors will be more effective wielders of the hatchet than committees—from my experience I do not believe that to be necessarily universally true. I have seen both lenient vice-chancellors and lenient committees; I have seen inflexible vice-chancellors and inflexible committees. But I believe it would be worth while extending the charge of the commissioners so that they may use their judgment as to which is the appropriate mechanism in either case in any university.
The Lord Chancellor: I shall also speak to Amendment No. 278C in this group. The Bill at present in Clause 174(1)(a) requires the commissioners to exercise their powers with a view to securing that the statutes of each qualifying institution include provisions enabling an appropriate body or any delegate of such a body to dismiss any member of the academic staff by reason of redundancy, whether or not in pursuance of a scheme established for the purpose. That was open to a certain amount of misunderstanding. It was thought that if there was a scheme it could be disregarded. We have concluded as a result of the reconsideration of this that the last words—
"whether or not in pursuance of a scheme established for the purpose"—
should be taken out. That is the government amendment to which I am speaking.
The amendment moved by the noble Earl, Lord Halsbury, and the amendment spoken to by the noble Lord, Lord Adrian, on redundancy, go in opposite directions. But that perhaps is to be expected in an informed discussion of this kind. The reason for the arrangement that we have put into the clause on redundancy is that we envisage that the appropriate body in cases of redundancy would be that which was responsible for the management and government of the institution and that such a body would in most cases decide whether a situation existed requiring dismissals for redundancy. In other words, as regards the first question, the redundancy situation would be a matter for decision by the governing body. Decisions on individual redundancy could then he delegated to a smaller body, as appropriate, or to an individual by that body.
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The decision as to whether redundancy could be said to be necessary in an institution is important and needs to be taken collectively and at a high level of management. Such a decision cannot reasonably be left to one individual. It would require a view of the institution's needs and resources as a whole. On the other hand, to remove the power of the body to delegate the detailed provisions to another body or individual would be too restrictive. One would expect the application of the general decision to be for the individual; possibly an individual officer or a small delegated body of members of the university staff.
As regards the second type of situation, where dismissal is on disciplinary grounds, it was thought that that was an individual decision and therefore appropriately taken by an officer in the first instance. The vice-chancellor or principal seemed to be a suitable officer to take such a decision, possibly advised by a small group. One must keep in mind that commissioners must lay down appeal procedures and therefore one must have within the structure proper scope for such procedures. One cannot use up, as it were, every available person in the institution to make the first decision because it would then be very difficult to organise the appeal situation properly.
That is the thinking behind the way in which the clauses are presently drafted. In the light of that explanation I hope that the noble Earl will feel that the distinctions are principled.
The Earl of Halsbury: For my part I thank the noble and learned Lord for that courteous and considered comment on the amendments that I have proposed. Subject to reserving my position for a further stage of the Bill, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
9.15 p.m.
Lord Adrian Lord Adrian had given notice of his intention to move Amendment No. 278:
Page 159, line 36, leave out ("any delegate of such a") and insert ("an appropriate officer (or both) or any delegate of such an officer or").
The noble Lord said: If possible I should like to reply to the noble and learned Lord the Lord Chancellor in respect of the points he has made. I believe that the effect of the amendments is not in any way to alter the possibilities that he has suggested might be the appropriate structure. Rather they are intended to allow the commissioners, if they found that some other arrangement was appropriate for the university, to consider it and then implement it if they thought it necessary and reasonable. The effect of the two amendments is not intended to restrict in any way what exists on the face of the Bill but rather to enlarge the possibilities that the commissioners might consider. Having said that, I shall not move the amendment.
[Amendment No. 278 not moved.]
The Earl of Halsbury The Earl of Halsbury moved Amendment No. 278A:
Page 159, line 37, after ("any") insert ("relevant").
The noble Earl said: With the leave of the Committee, I should like to speak to Amendments

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Nos. 278A and 278B. They are two further petitioners' amendments, as one might call them. Their purpose is to make clear the fact that fixed-term contracts may be awarded and are to be outside the redundancy provisions of the Bill. The amendments are particularly vital in the scientific field. Academics are likely to accept offers from those institutions able to offer funding for a period covering their research. The absence of such a power will make it impossible to attract overseas researchers who need security. It is also likely to make British universities uncompetitive in the scientific field. I beg to move.
The Lord Chancellor: The essential amendment is that to which the noble Earl has spoken and which creates the possibility of fixed-term contracts. It would be fair to say that in the circumstances to which he referred where the research is funded in a particular way, the likelihood of redundancy in respect of that research is very much reduced. The view that the Government have taken, and which I venture to suggest is reasonable, is that one ought to have a situation in which the general provisions are as we have put them: that is, preserving the possibility of redundancy but in many of the cases to which the noble Earl has referred that would be theoretical only. If one introduced fixed-term contracts one would have the same sort of rigidity in respect of changes of circumstances as is occasioned by tenure. There has been a growth in recent years of fixed-term appointments due to the difficulty created by tenure, especially in those universities which confer tenure. I therefore hope that the noble Earl will feel able to withdraw this amendment.
Lord Hylton: As a non-academic lay-person it seems strange to me to go from a situation of complete tenure in some universities to one where there is no tenure in any. I should have thought that fixed term contracts should be encouraged in order to enable universities to apply their judgment to varying situations. I rather hope that the noble Earl will not withdraw his amendment.
Lord McCarthy: As I understand the noble and learned Lord, he said that when universities had fixed-term contracts that were funded, the possibility of redundancy did not create a problem. I do not think that is quite right because contracts now are often subject to review. They may be subject to review at two years or three years with the normal expectation of those contracts continuing for five years. However, if the university wishes to attract some senior person to head a research unit in order to run that contract, it is normal to give that person an expectation of tenure. Indeed, if one could not give someone of professorial status an expectation of tenure to take up the leadership of a funded unit for, say, a period of five years, one probably could not get anybody of a sufficient calibre to take up that post. Therefore the ability to offer at least heads of research units the possibility of tenure is extemely important. I should have thought that for that reason the Government should accept this amendment.
The Lord Chancellor: I do not think I said that the possibility of redundancy was limited altogether. I
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should have thought that in the sort of situation that the noble Lord, Lord McCarthy, is figuring, the institution is secure in the knowledge that a particular research project is to be funded. On that basis, the possibility of the only matter that is between us coming into effect is very, very small indeed. In such a situation I should have thought that the practical effect of paragraph (a) is negligible. Where universities have reason to believe that the funding has been allocated for a particular research project for, say, five years, the possibility that the person who is put there to head the unit will be made redundant before five years is surely sufficiently small to be ignored. Therefore the result is that in practical terms the overall regime produces very much the desired result.
The Earl of Halsbury: I am very grateful for the support I received from my noble friend Lord Hylton and the noble Lord, Lord McCarthy. What I do at this stage depends on how one views these Committee proceedings. I have always thought that the Committee stage of a Bill was rather like a fencing match with button foils. Occasionally the buttons come off and you draw blood; but that is not my intention this evening. Notwithstanding such encouragement as I have had, I would sooner withdraw conditionally with a view to reserving my position at a later stage. I can study at length the contributions made by the noble and learned Lord the Lord Chancellor and other noble Lords, discuss them with, if one likes to call them, my clients, and bring them back at a later stage when I have had a chance to study them in full.
Amendment, by leave, withdrawn.
[Amendment No. 278B not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 278C:
Page 159, line 38, leave out from ("redundancy") to end of line 39.
On Question, amendment agreed to.
Lord Adrian Lord Adrian had given notice of his intention to move Amendment No. 279:
Page 159, line 40, leave out ("officer, or any delegate of such an officer") and insert ("body or an appropriate officer (or both) or any delegate of such an officer or body").
The noble Lord said: I shall not move this amendment with the reservation that I may come back to it at a later stage.
[Amendment No. 279 not moved.]
[Amendment No. 279ZA not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 279ZAA:
Page 159, line 43, after ("cause") insert
—
("(ba) provision establishing disciplinary procedures determined by the Commissioners for dealing with any complaints made against any member of the academic staff relating to his appointment or employment;").
The noble and learned Lord said: This amendment and Amendment No. 279ZAB are further steps to discharge the pledge the Government have given that they will do all they can to secure academic freedom by giving protection against arbitrary dismissal on unwarranted grounds, which I referred to this

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afternoon. Notwithstanding the vote of the Committee on the matters we were discussing then, I believe that it is still right to put these amendments into the Bill.
In the other place the Government undertook to bring forward amendments which would establish disciplinary and grievance procedures for staff. These amendments honour that undertaking in respect of dismissals. In considering how to give effect to this approach we have come to the conclusion that it would also be right to ensure that the test of reasonableness along the lines of the Employment Protection (Consolidation) Act 1978 would apply to dismissals.
Ministers are currently discussing the precise formulation of provisions relating to grievance procedures with the Committee of Vice-Chancellors and Principals. Indeed, we had tabled amendments on the grievance procedures but as a result of requests from the vice-chancellor's committee we withdrew them for consideration later.
The Government will be proposing the necessary further provisions on Report in the light of these discussions as I said earlier. In the Bill as introduced Clause 174(1) requires the commissioners to exercise their powers with a view to securing that the statutes of each qualifying institution include provisions enabling staff to be dismissed for redundancy and good cause and provisions establishing procedures for hearing and determining appeals against dismissal. These amendments add to those provisions.
Amendment No. 279ZAA would make provision establishing disciplinary procedures determined by the commissioners for dealing with any complaints made against any member of staff relating to his employment or appointment. Amendment No. 279ZAB would extend the appeals procedure to include disciplinary matters. It would preclude a person from being dismissed for a reason which cannot in the circumstances, including the size and administrative resources of the institution, reasonably be treated as a sufficient reason for dismissing him. I believe that these provisions give a proper strength to academic freedom by providing additional safeguards which will give academics greater protection against victimisation by their colleagues on account of their beliefs or opinions. I commend these amendments to the Committee and I beg to move Amendment No. 279ZAA.
The Deputy Chairman of Committees (Lord Airedale): The amendment proposed is, "Page 159, line 43, after (`cause') insert", the words as printed on the Marshalled List. However, if the next amendment is going to be discussed with this one, I have to point out to the Committee that if Amendment No. 279ZAB, the next one, is agreed to, I cannot call Amendments Nos. 279ZB down to No. 279ZE in the form in which they have been tabled on the Marshalled List. This is because Amendment No. 279ZAB pre-empts Amendments Nos. 279ZB to 279ZE.
However, it would be possible, if the Members of the Committee who have tabled Amendments Nos.
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279ZB to 279ZE so wish, to move those amendments as amendments to Amendment No. 279ZAB. In that event, I would at the appropriate moment put the Question on each of the Amendments Nos. 279ZB to 279ZE in the appropriate form.
I understand that the Members of the Committee concerned have indicated their wish to move their amendments in this form as amendments to Amendment No. 279ZAB. I shall therefore call Amendments Nos. 279ZB to 279ZE as amendments to Amendment No. 279ZAB after the noble and learned Lord the Lord Chancellor has moved Amendment No. 279ZAB and I have put the Question on it for the first time.
9.30 p.m.
Lord Morton of Shuna: I offer my congratulations to the noble Lord the Deputy Chairman of Committees, if that is in order!
I wish to speak to Amendments Nos. 279ZAA and 279ZAB. Amendment No. 279ZAA, unless I am mistaken, has nothing to do with what we thought we were discussing up to now, which is unfair dismissal. It seems to bring into the Bill for the first time a provision that the commissioners are to set up some form of procedure in the university statutes to allow the university, when considering a complaint against a member of the academic staff, to downgrade or to reprimand that member of staff. I do not see what it has to do with Clause 174. The one matter with which it has had nothing to do is dismissal or redundancy. I hope that the noble and learned Lord will be able to explain the purpose of suddenly bringing in what appear to be reprimands and downgrading.
It is my information that this was not asked for by the universities or by the vice-chancellors. It is apparently designed to provide a procedure for reprimand and downgrading. That is the understanding conveyed to me by the Department of Education and Science officials, maybe wrongly. If there is to be a procedure to deal with complaints made against a member of the academic staff, would it not be necessary to cover also complaints by a member of the academic staff? If we are to deal with this at all, it would seem proper to cover the situation where a member of staff complains and wants his complaint dealt with.
I turn to Amendment No. 279ZAB. I understand that the purpose in general is to introduce an element of reasonableness into the situation to attempt to reduce the anxieties expressed on Second Reading that the provision might be used, for example, to get rid of a professor and replace him with a junior lecturer doing the same work at a cheaper rate. The amendment is unsatisfactorily worded. I spent some time endeavouring to understand it. It appears to go round in a circle and to end up where it started.
"No provision such as is mentioned in subsection (1)(a) or (b) … which is included in the statutes … by virtue of section 175 … shall enable any member of the academic staff to be dismissed unless the reason for his dismissal may in the circumstances … reasonably be treated as a sufficient reason for dismissing him".
It is very difficult to extract any comprehensible meaning from that. This may be my lack of understanding. I have tried to understand it and I have tried it on several of my noble friends, but I

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cannot get a reasonable meaning from it. I shall read it again:
"the reason for his dismissal may … reasonably be treated as a sufficient reason for dismissing him".
It does not seem to add anything and perhaps does not express the intention that the noble and learned Lord wished it to express.
The Lord Chancellor: I said earlier that we had put down amendments on grievance procedure which were withdrawn after representations from the vice-chancellors. The grievance procedure relates to complaints by members of the university staff. I explained that that had been put down and withdrawn.
Amendment No. 279BA is a provision for establishing disciplinary procedure for dealing with any complaint made against any member of the academic staff relating to his appointment or employment. Clause 174 refers in particular to dismissals, but the disciplinary procedures would certainly encompass that.
The noble Lord has difficulty in understanding the second amendment. It is a question of reading it properly. No one shall be dismissed unless the reason is a reason which can reasonably be treated as sufficient for dismissing him. In other words, someone cannot be dismissed unless there is a reasonably good reason for doing so. That is all. That seems reasonable.
Lord Morton of Shuna: That sounds perfectly reasonable, but why not say it? Why not put it into the Bill in the reasonable words which the noble and learned Lord so reasonably used, instead of using words the meaning of which many of us have difficulty in following?
Lord Wedderburn of Charlton: Before the noble and learned Lord responds, perhaps I may ask him something which is in the nature of a supplementary question. This deals with the substantive ground for dismissal. As this provision and the whole of the rest of this part of the Bill is not geared into the Employment Protection (Consolidation) Act, in which forum of the many fora in which employment dismissal questions can arise does he think that this protection for the employee could be adduced? In what way would it intermesh with employment law as a whole? At the moment it stands, like the rest of this part of the Bill, as an island in itself.
The Lord Chancellor: I sought to explain this point in my speech at Second Reading in answer to a point which the noble Lord, Lord Wedderburn of Charlton, made in his speech at that time. There may be some misunderstanding here. It has to do with the amendments which in due course we shall have moved as amendments to the amendments we are considering now. Before I come to that perhaps I should say in answer to the noble Lord, Lord Morton of Shuna, that the words which I used a moment ago are, read a little short, the words that are in this amendment.
On the point raised by the noble Lord, Lord Wedderburn, the position as I see it is that the
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procedures with which we are dealing here will be used to decide whether the university—to take the university as a paradigm case—has dismissed the person. In other words, they are procedures that are open in order to review the decision to dismiss. They are appeal procedures. The dismissal must be just and fair. There is a procedure to be put in for deciding on appeal whether what has been put forward by the university—the original officer in the good conduct case—was a proper decision. If the appeal is successful, the member of the university staff will remain a member of the staff. If the appeal is not successful, the member will not. If the dismissal takes effect that would not preclude the possibility of a claim in an industrial tribunal.
One has to look at this against the background of tenure. Tenure prevented members of the university staff from being dismissed at all. They were entitled to continue, unless good cause was shown, as members of the university staff. These procedures are designed to replace that and to say that a member of the university staff will not be dismissed except in accordance with the proper procedure laid out in these provisions. Therefore the member of the university staff is protected against losing his job by such procedures.
Lord Wedderburn of Charlton: I am trying to make progress because it may cut out discussing points later on. The question is not about the internal procedures. As the noble and learned Lord said, the internal procedures may be used and then, if the member of staff remains dismissed, he may wish to go elsewhere. I want to engage the noble and learned Lord on the footing that we are both, so to speak, advising this client—outside of this Chamber, of course. What do we say to him? We say to him that he should proceed with his action, if there is a good point to argue.
However, do we say to him, "Yes, you can go to the tribunal and you can rely upon a sufficient reasoned ground"; or is that now behind us? I think that perhaps it is behind us, in regard to the internal procedures. Therefore this ground is only relevant to the internal procedures. If they fail, legally the member of staff who has been dismissed will derive nothing out of the clause at all, either in the High Court or in the industrial tribunal. Is that right?
I understand about the internal procedures, but I am not asking about those. I am asking about the legal position of a claim of someone who is ultimately upheld as dismissed and wants to dispute it because he says that the reason was not sufficient. Where does he go?
The Lord Chancellor: That rather depends on what he is suggesting. Let us assume that he is not complaining about the propriety of the internal procedures and that he accepts that he has been effectively dismissed by the university. In that case he has the industrial tribunal open to him and there is nothing in this provision that cuts out the industrial tribunal procedures. He has the right to go to the industrial tribunal.
One would hope and believe that if the internal procedures had worked properly his case would not

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be a strong one, but that might not preclude its being argued. He would have the opportunity to go to the industrial tribunal and argue the matter there. He would be able to argue for reinstatement or for compensation. As I understand it, there is nothing in this provision which cuts out the ordinary procedures if the dismissal is actually effective. I hope that is the explanation which the noble Lord requires.
Lord McCarthy: I should like to take the noble and learned Lord back to the previous amendment; namely, Amendment No. 279AA. Many questions arise in this connection. I should like to know whether the vice-chancellors have seen the amendment because, as I understand it, they are saying that they see no reason for an amendment of this nature, they never asked for it and they do not know where it came from. That would make sense because it is an odd type of provision to find in Clause 174. I remind the Committee that Clause 174 has a procedure for specifying what must go in the statute so that you can be dismissed by reason of redundancy, so that you can be dismissed for good cause. It includes a system of appeals. The system of appeals is one which the individual academic who thinks that he has not been fairly and justly dismissed can use to obtain justice or fairness.
However, we now have another disciplinary procedure and it does not seem to me, on the face of it, that this helps the individual in any way. It helps the vice-chancellor, the professor, the university or anyone who has a complaint to make against the individual. I say that because it specifies a,
"provision establishing (disciplinary) procedures determined by the Commissioners",
for dealing with any complaints made against any member of the academic staff.
In other words, it seems to me that here is an additional procedure, not to protect the individual academic against wrongful dismissal—because we already have one—but to facilitate complaints made against him by other members of academic staff or anyone else. Why has this provision been included? Why has it been put in at this late stage? What criteria will be used to decide whether the complaints which are brought against individual academics are in fact sustained? Will they he asked whether they are just or fair, or whether they are compatible with academic' freedom? Further, as the noble and learned Lord thinks those three terms are all synonymous with each other, will they all be involved in this? Why was the procedure put in at this late date when, so far as I can see, no one has asked for it?
9.45 p.m.
The Lord Chancellor: I never said that justice, fairness and academic freedom were synonymous.
The procedure is designed to deal with complaints against members of the university staff. It is subject to the provisions of Clause 173, as amended by the Committee this afternoon. Apart from the amendment, Clause 173(2)(b) provides that the commissioners shall have regard to the need to apply the principle of justice and fairness. The procedures
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are subject to the principles of justice and fairness, both of which concepts appear to be appropriate to the procedures.
The other side of the matter relates to the grievance procedure with regard to a member of the staff against another member of staff or against the university. As I said, we withdrew that proposal for further consideration as a result of representations made by the vice-chancellors. There is a certain element of balance in the provision. The point is that if a member of the university staff can complain, for example, that something has been done to him which he thinks should not have been done—someone instanced earlier the possibility of having to lecture at nine o'clock in the morning instead of at a more reasonable hour as an attack upon the person's academic freedom because of his views—he would have to have some way of bringing that complaint against his fellow academic. Whoever it was who arranged that he should lecture at nine o'clock should have the chance to answer the complaint and explain that he was doing it in the best possible interests of the institution and not because he wanted to penalise his colleagues' unpopular views.
Lord Allen of Abbeydale: Will the noble and learned Lord consider withdrawing the amendment until we have the grievance procedure so that we can see it all in balance?
The Lord Chancellor: I do not mind doing that if the Committee thinks that it would help. This is a reasonable procedure to have in the Bill. If the Committee feels strongly about it, I would wish to go along with the Committee's views. The provision is distinct. We are talking about complaints against members of the university. It would seem reasonable to have a procedure, subject to justice and fairness, by which they could be dealt.
Lord Allen of Abbeydale: I was not suggesting that we should not have the procedure; I was suggesting that we had only half the story and that it would be nice to see it all.
Lord Morton of Shuna: At the moment this provision is by itself and we do not know what is to come with it. It sits outwith other provisions which deal merely with dismissal. It is much more easy to discuss the subject if we see it in the context of the grievance procedure that the noble and learned Lord hopes to introduce.
Baroness Seear: Is what the Government are offering academics the procedure in lieu of tenure? If they are, it does not look like a very good bargain to me. At the end of the day, the dismissed person has the opportunity to go to an industrial tribunal, which can rarely bring about reinstatement. At the moment such a person receives the kind of payment which would not keep the dismissed academic going for more than about six months at the very most. As an exchange for tenure, it is a very poor deal.
The Lord Chancellor: I must be becoming short of the ability to explain. What I said was that these are

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internal procedures which would have the effect of keeping the person in position. That is what is put in instead of tenure. It keeps the person in position, assuming that the internal procedures work in his favour, which is what tenure does. Tenure keeps the person in position. We say that he should not automatically be in position; he should be kept in position unless he can reasonably be put out of position on redundancy or for good cause. That is the bargain. It seems to me a very reasonable bargain. It is quite wrong to equate it with the industrial tribunal; that comes after.
If a person is dismissed, then, in addition to these internal remedies, like every other person who is in employment he has the industrial tribunal to go to. Admittedly the money he gets from the industrial tribunal may be rather less than he wishes, but the important protection he gets here is the protection of the internal procedures which we have proposed in the Bill, modified by these clauses.
The Earl of Halsbury: I hope that the noble and learned Lord will not withdraw his amendments until the Committee has had the opportunity to listen to the amendments to the amendment.
Lord Morton of Shuna: My suggestion was not that both amendments should be withdrawn but only that Amendment No. 279ZAA should be withdrawn until we see the other side of the coin of the grievance procedure. The noble Baroness, Lady Seear, asked her question and I think that as a result the noble and learned Lord did not reply to the noble Lord, Lord Allen of Abbeydale, as to whether it might be better not to move the amendment at this stage until the grievance procedure was available.
The Lord Chancellor: I believe that I did answer, but I am always willing to answer again, not for the first time. Having put down the amendment, and Members of the Committee having seen it, I do not feel particularly anxious to withdraw it unless the Committee feels that it would be particularly helpful. But as the noble Earl, Lord Halsbury, said, we have these other amendments to consider as well. I should have thought that no harm would be done by keeping this amendment in and looking at the others, which will be amendments to Amendment No. 279ZAB.
Lord Wedderburn of Charlton: Does the noble and learned Lord feel that Amendment No. 279ZAA might well be taken away? He could come back with the amendments which he promised, in view of the statement today by the Committee of Vice-Chancellors and Principals that the amendment has caused them some concern. It has come as a complete surprise to them and appears to be designed to downgrade and reprimand people without sacking them under the procedure. Universities have not asked for this. Does the noble and learned Lord consider it better that we should look at it in its full context and after the Committee of Vice-Chancellors has been consulted?
The Lord Chancellor: I do not see any particular harm in doing that. I certainly intend to bring it back in due course. I may be that it will look better and even be easier to understand in the light of the other provisions of which I think it originally formed part. In that situation I shall not invite the Committee to agree tonight to Amendment
No. 279ZAA.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Lord Airedale): If the noble and learned Lord the Lord Chancellor will formally move Amendment No. 279ZAB, I shall then call the next amendment as an amendment to it.
The Lord Chancellor The Lord Chancellor moved Amendment No. 279ZAB:
Page 159, line 48, at end insert ("or who are otherwise disciplined.
(1A) No provision such as is mentioned in subsection (1)(a) or (b) above which is included in the statutes of a qualifying institution by virtue of section 175 of this Act shall enable any member of the academic staff to be dismissed unless the reason for his dismissal may in the circumstances (including the size and administrative resources of the institution) reasonably be treated as a sufficient reason for dismissing him.").
The noble and learned Lord said: I beg to move.
Lord McCarthy Lord McCarthy moved, as an amendment to the amendment, Amendment No. 279ZB:
Page 159, line 48, at end insert ("including provision for adequate remedies, including reinstatement").
The noble Lord said: I am told that I must say that I wish for the new words printed in the Marshalled List to appear after "disciplined". The amendment in my name and the name of the noble Lord, Lord Wedderburn, in simple terms, is to introduce into these procedures an appropriate remedy. The remedy which we suggest should be introduced is:
"including provision for adequate remedies, including reinstatement".
We should like to take this with the similar amendment No. 279ZC, put down by the noble Earl, Lord Halsbury and the noble Baroness, Lady Seear:
"And for establishing reinstatement as the primary remedy under such procedures".
In effect, we are seeking to invoke the provisions of the Employment Protection (Consolidation) Act 1978 in a more effective way. Our examples are the provisions in Section 69 of the Employment Protection (Consolidation) Act, which states that an industrial tribunal may—I emphasise "may"—make an order for reinstatement or re-engagement.
"Reinstatement" means:
"that the employer shall treat the complainant in all respects as if he had not been dismissed".
including, if appropriate, back pay, seniority and pension rights. That reinstatement or re-engagement, which is a rather more diluted form of reinstatement, is, of course, re-employment to another suitable employment. But what we have in our amendment is reinstatement.
There are, I think, three general arguments which could be made for this. The first is that on the face of the Bill there are no stipulations as to remedies as such. There is in particular nothing really in practice and in actuality about the remedies which are to be expected in cases of dismissal on grounds not of redundancy but of good cause.
In cases of grounds of redundancy the Government have said to the appropriate authorities that people who are dismissed on grounds of redundancy will be treated in a comparable way to the way in which people have been treated up to now in cases of voluntary severance. But of course that is not in the statute. We do not know how long that will
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last, but at least the Government have made a reasonable offer in the case of dismissal on grounds of redundancy.
Secondly, when we come to the case of an unfair dismissal on grounds of good cause, or rather on grounds of bad cause, we know nothing from the face of the Bill. Therefore I suppose that we must assume that the only remedy in terms of compensation would be the maximum remedy now available under the terms of the Employment Protection (Consolidation) Act. The top level remedy of some £8,000 is, as the noble Baroness, Lady Seear, has said, worth about six months' or less salary to the average academic. Indeed it would not necessarily follow that an academic dismissed in this way and getting compensation in this way would receive anything like £8,000. That is the maximum level. The medium level of compensation given by industrial tribunals is much closer to £2,000.
Thirdly, unless academics whom the tribunals have decided have been unfairly dismissed allegedly on grounds of good cause are to be given some extraordinary level of non-statutory compensation which has not been suggested by the Government or anyone else, then the appropriate remedy would appear to be reinstatement.
It may be asked, since the tribunals can award reinstatement, why not leave it to them? It may be asked why we need this provision on the face of the Bill. The answer to that is that even in successful cases the tribunals only award reinstatement or re-engagement in some 3 per cent. of instances. For various reasons which we do not necessarily want to go into tonight, reinstatement has not been used by tribunals as the normal primary remedy. The remedy has been some form of compensation.
The Earl of Halsbury: Is the noble Lord speaking to his own amendment or to mine? His own amendment speaks about:
"including provision for adequate remedies, including reinstatement".
It mentions reinstatement as an option, whereas my amendment states:
"establishing reinstatement as the primary remedy under such procedures."
I am getting a little confused as to who is speaking to which amendment.
Lord McCarthy: That is probably my fault. I understood that these two amendments had been grouped together and that as a result of that one was expected to speak to both of them. I am in fact dealing with my own amendment, but I am very happy with the amendment standing in the name of the noble Earl. In some ways his amendment is stronger than mine. But I shall speak to both if the noble Earl does not mind.
Usually re-employment is not awarded in industrial tribunal cases. It does not appear to be an available remedy but we would suggest that there are very good reasons why in the case of academics it should be regarded as an appropriate remedy. I would even go so far as to say that it should be regarded as the primary remedy.
One of the reasons for this, of course, is that the level of compensation is extremely low. Another argument for this is that many academics will

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undoubtedly find, as has been said by the noble Earl, Lord Russell, that when they are dismissed they are extremely difficult to reabsorb. They have a very special expertise and if the university of their employment says that they cannot be employed they will find it extremely difficult to get re-employed somewhere else. I believe that the noble Earl said that one in 1,000 became re-employed. I am not sure where he got the figure from but that is certainly a very low chance of re-employment. Therefore, we believe that there are many reasons for academics to have on the face of the Bill a statement that the Government regard reinstatement as the normal remedy in those circumstances. I beg to move.
10 p.m.
The Lord Chancellor: I shall start at the beginning. Clause 174(1)(a) confers power on, in effect, a university to dismiss a member by reason of redundancy. Clause 174(1)(b) empowers it to dismiss a member for good cause. It provides an appeal procedure with the object of ascertaining whether there was either redundancy or good cause. If there is neither redundancy nor good cause, there is no power to dismiss.
Therefore, the idea of reinstatement and so on is absolutely beside the point. The dismissal is annulled because it is an appeal against dismissal. The only power to dismiss is the power to dismiss for redundancy or good cause. If the appeal is successful, there is no proper redundancy and the member has not been properly selected for redundancy. If it is successful, there is no power to dismiss and the person stays in position.
It is not a question of going to an industrial tribunal or receiving compensation on industrial tribunal terms at that stage. As I sought to explain to the noble Baroness, Lady Seear, we are trying to produce a close analogue to the present position without the rigidity of the present tenure system. That means that people cannot be put out of their jobs or appointments in a university unless redundancy exists and is established or unless good cause exists and is established. If neither of those is established on appeal within the internal procedures, then the person is not dismissed.
If the internal procedure produces the result that there was either redundancy or good cause, then in addition to the internal procedures, they having finished and the person having been dismissed because the appeals were unsuccessful, there remains over and above the internal procedures provided by the Bill the statutory procedures of the industrial tribunal. Members have the right to stay unless either of those matters is established. If either of those matters is established, members have the right to have good cause re-examined by the industrial tribunal and redundancy dealt with as well, with the same consequences as are to be found in any other case.
That is the position. It is not a question of that being the primary remedy; it is the remedy in those cases. The dismissal is annulled.
Lord Wedderburn of Charlton: We are trying hard to follow the noble and learned Lord. Perhaps my
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question will help us to make progress. He said that dismissal in breach of what we might call the statutory procedures, as laid down under the commissioners' guidance and under the clause that we are debating, through not having sufficient reason, not having good cause or not being redundant—he used the word "redundancy" in the special meaning of Clause 174 which I shall later refer to as double redundancy—is a nullity. That is quite different from the normal position in English law. There may be a slight difference in Scottish law. Normally in English law the dismissal is not a nullity unless it involves a statutory body, as was the case in the Dock Labour Board cases with which the noble and learned Lord will be familiar.
We are now equating universities with statutory bodies for the purpose of deciding whether they have legal capacity to effect a dismissal outside the procedures. That is the first point which we have clarified. I do not think that that has been disclosed to us either in debates in the other place or previously here. It is a very fundamental and important point. It changes the position of universities, especially those which are chartered bodies and which would have had the capacity to do anything as far as concerns the law up to now. So there is a very big change which is overcoming their legal capacities. The noble and learned Lord is nodding so I believe that we are as one so far.
When one believes that the appeals procedure has got it wrong, the crunch comes when the member of staff says: "The appeals procedure said that there was good cause and that it was double redundancy under Clause 174(4), but I dispute that still. They are keeping me out". When he goes on to the industrial tribunal or possibly the High Court for judicial review since these are statutory bodies with a limited capacity he is not then allowed, excepting judicial review, to rely upon sufficient reason, double redundancy arguments. In the industrial tribunal the 1978 Employment Protection (Consolidation) Act would apply unqualified and unchanged. It would be unchanged by any of these phrases. He can forget sufficient reason; in the tribunal he must rely on the 1978 Act. Is that right? If it is, it is very important.
The Lord Chancellor: That is my understanding and it has been since I spoke on Second Reading. I took up this very point in my speech because I thought from what he said in his speech that the noble Lord, Lord Wedderburn, had not grasped it. I think that I was perhaps anticipating these amendments.
The way I understand it, and I hope that I am right, is that what is specified is the power to dismiss. These grounds are required in order to justify exercising that power. The appeal procedure is to test whether or not grounds for exercising the power exist. If the grounds for exercising the power do not exist, then there is no effective dismissal. That is what the procedures are for. Most universities are bodies which have constitutions and the question of whether the constitution has been breached is what the appeal is about.
The Thomas case is a good example. The noble Lord is shaking his head very vigorously not as if in agreement but rather the opposite, which is a pity.

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The Thomas case, in which the visitor's jurisdiction was asserted, is an example of whether the powers of the university—Bradford in that case—had been properly exercised to dismiss the appellant. If the lady had been successful the result would have been that she was still in position and that there was no power to dismiss. That is the way I understand the position. That is why I think that these amendments, with great respect, if anything weaken the position instead of strengthening it.
Lord McCarthy: The noble and learned Lord has converted me to the reason why we put down amendments. We learn things. We learn important things. The noble Lord, Lord Wedderburn, asked him a complicated question. Perhaps I may ask him a simple question. What is the remedy if, despite the fact that the university has no power to dismiss, the individual academic is dismissed anyway? What does he do?
Lord Trafford: Having listened to the discussion, perhaps we can clarify the position. We are talking about two different things. Surely these amendments do not really apply. Reinstatement is automatic if the internal procedures determine that no dismissal has taken place. The academic is automatically back in post. So how on earth can reinstatement apply to a situation where he has not been—if I can use the word—"deinstated"? That is what the procedures are about.
If these amendments were to some other Bill relevant to industrial tribunals that would be quite different. But we are not talking about, and the Bill is not concerned with, industrial tribunals. It deals with the internal procedures that are to be set up. So if a person is not "deinstated"—in other words sacked, fired, dismissed—then the problem does not arise. It arises only in relation to industrial tribunals, but the Bill is not concerned with industrial tribunals. The amendment is to the internal procedures, which cannot apply.
I ask my noble and learned friend whether I am correct in that assumption.
The Lord Chancellor: Yes; the noble Lord is correct.
Lord Trafford: They are irrelevant.
The Lord Chancellor: The answer is that if the complaint is that the internal procedures have not been properly followed the remedy would be judicial review, as the noble Lord, Lord Wedderburn, said. If the person wishes to challenge dismissal, the alternative is not to challenge dismissal but to go to an industrial tribunal on the basis that such dismissal is effective but gives rise to the remedies available in an industrial tribunal; that is, reinstatement, re-engagement or damages, according to the situation.
Earl Russell: Before the noble and learned Lord sits down, for the benefit of unlearned Lords as I am perhaps I may ask him what are the implications of becoming a statutory body for the purposes of dismissal.
The Lord Chancellor: I shall try to put the point as briefly as possible. If I employ someone and dismiss
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him, the law does not normally force me to take that person back into my employment, but if I have powers which are defined powers to dismiss someone—that is to say, if I am a corporation or a statutory body (a body with charter and laws)—then should I possess the power to dismiss only in certain circumstances and those circumstances do not exist, I cannot lawfully dismiss that person. Therefore if I purport to dismiss that person without proper grounds, the dismissal is only a purported dismissal and the person is entitled to continue in employment.
The simplest example would be in the tenured case. It is certainly my understanding of the position that where there was tenure, unless there were good cause the person could not be put out of a job. That is the implication of the provision. If as an individual I contracted with someone to the effect that he should work for me for ever or up to a certain time and I dismissed that person, there would be a remedy of damages. He could not say that I had no power, as an individual human being has power, to dismiss him.
However, a university of this sort has the powers that its constitution gives it, and the constitution gives to the members of the university the right not to be dismissed except in accordance with the procedures and on grounds laid down in that constitution. Therefore if the university purports to dismiss someone in contravention of those procedures or without those grounds, that purported exercise is without foundation and the person remains employed by the university.
The procedures of which we are speaking are intended to have that effect. That is why I answered the noble Baroness earlier as I did. That is the quid pro quo of taking away tenure. I have to say that they are very strong remedies. Noble Lords who have spoken know a great deal about the Employment Protection Act; indeed, so much about it that they are ready to assume that it is being swallowed entirely into this statute, which of course is something that we are not doing. The remedies there are much weaker: there is reinstatement, re-engagement and damages, although reinstatement is not given so often. A much stronger position is given to the academic. He retains his position in the university unless there is redundancy or good cause is made out in accordance with statutory grounds sustained on appeal.
Earl Russell: I thank the noble and learned Lord for that very helpful answer.
Lord Wedderburn of Charlton: Before the noble and learned Lord sits down, perhaps I may tell him, first, that he must not chide us for speaking of academics going to tribunals, which is what Ministers in the other place have been saying is often enough the end product of this. We now understand that this would not normally be foreseen as the end product. The normal remedy that the academic would pursue in the test case, which is of course the case where all the procedures do not work properly, is that he should go for judicial review; in other words, to use the words of the late Lord Diplock, to show that the university acted irrationally in that sense of unreasonableness—Wednesbury sense of unreason-ableness—in coming to the conclusion that there was something which could reasonably be treated as a sufficient reason for dismissal.

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That would be the test that he had to meet; and whereas judicial review has many advantages procedurally, the hurdle that he would have to surmount in judicial review would be higher than that which he would have to leap in the tribunal. Therefore what the noble and learned Lord says has consequences throughout the whole process and a new body of employment law for those who are employed by the statutory bodies would be created for which the major remedy would be judicial review, which would not always be to their advantage. It would seem to me that he might explain this to us further on Report.
10.15 p.m.
The Lord Chancellor: I do not think I am capable of explaining it any further than I have done already. The position is quite clear. I do not believe that the ordinary case for judicial review would be on rationality. It would be on some procedural failure. One would expect the merits of the appeal system would be such as to test the merits. There might be an extremely exceptional case, but it would be extremely exceptional. I expect noble Lords wish to proceed.
Lord McCarthy: We must thank the noble and learned Lord for giving us a most interesting lifting of the carpet. A great deal may follow. We must reserve our position if we wish to come back on Report. At the moment we are pleased to beg leave to withdraw the
amendment.
Amendment to the amendment, by leave, withdrawn.
[Amendment No. 279ZC, as an amendment to Amendment No. 279ZAB, not moved.]
The Earl of Halsbury The Earl of Halsbury moved, as an amendment to Amendment No. 279ZAB, Amendment No. 279ZD:
Page 159, line 48, at end insert ("and
(d) provision enabling an appropriate body to offer any member of the academic staff who fulfils specified criteria of successful achievement in performance of his professional responsibilities, appointment until retirement subject to the provisions of paragaphs (b) and (c) above.").
The noble Earl said: The provision of Amendment No. 279ZD is designed to ensure security from dismissal by reason of extraneous opinions by allowing the commissioners in institutions to dismiss academic staff by reason of redundancy as defined in Clause 174(4) or for good cause. Possibly a good deal of that has been already raised and answered by the noble and learned Lord. If he would care to confirm that I should be happy to withdraw the amendment.
The Lord Chancellor: I dealt with this earlier, as I did also the amendment of the noble Lord, Lord Pender, which follows immediately. The idea was that it might be possible to give special people tenure. I explained why I thought that that was not a good idea. I have therefore sought to answer this.
The Earl of Halsbury: I beg leave to withdraw the amendment.
Amendment to the amendment, by leave, withdrawn.
[Amendment No. 279ZE, as an amendment to Amendment No. 279ZAB, not moved.]
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 279ZF:
Page 160, line 3, after ("otherwise)") insert ("and—

(a) there is no requirement for any instrument which would have the effect of modifying the provision to be approved by Her Majesty in Council or to be laid before both Houses of Parliament; and

(b) but for this subsection, there would be no requirement for such an instrument to be approved by the Privy Council;").

The noble and learned Lord said: With this amendment I should like to take Amendments Nos. 279ZG, 279AD and 279AE. These are all technical amendments. Some affect matters we discussed earlier in relation to the Privy Council. I tried to take account of these amendments when replying at that time. To start with Amendment No. 279ZF, the effect of Clause 174(2) is that once the commissioners' modifications to the statutes of an institution had been approved by Her Majesty in Council an institution would, unless there are existing controls, need Privy Council approval before instruments having the effect of modifying the provisions in the statutes of a kind mentioned in Clause 174(1) could have effect. Those provisions concern dismissal for redundancy and good cause, and for appeals against dismissal. If the Government's amendment for appeals against dismissal were accepted, it would apply to these also. Some institutions are governed by statutory provisions. We have no wish to interfere with the status quo where existing controls are sufficiently stringent. This amendment ensures that approval by the Privy Council will only be required where existing controls are not adequate.
Amendment No. 279ZG is purely a drafting amendment. Amendment No. 279AD is explained thus. Clause 174(5) defines "good cause" as meaning a reason falling within paragraphs (a) or (b) of Section 57(2) of the Employment Protection (Consolidation) Act 1978. Those reasons are in terms of contracts of employment and would not be apt where a member of academic staff had no contract of employment. This amendment ensures that the definition applies to all staff whether they have a contract of employment or not. If they merely held an office, for example, this would apply. I am not sure that there are many of them but there might be. Therefore we have this provision.
Amendment No. 279AE follows directly from Amendment No. 279AD. The technical amendments introduce no new provisions but simply clarify what was intended. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 279ZG:
Page 160, line 5, leave out from ("instrument") to ("it") and insert ("which would have the effect of modifying the provision shall have that effect unless").
On Question, amendment agreed to.
The Principal Deputy Chairman of Committees (Baroness Serota): In calling Amendment No. 279A, I should point out to the Committee that if this amendment is agreed to I cannot call Amendments Nos. 279AA and 279AC.
Lord Allen of Abbeydale Lord Allen of Abbeydale moved Amendment No. 279A:
Page 160, line 12, leave out subsection (4) and insert—
("(4) For the purposes of this section redundancy shall have the same meaning as in section 81(2) of the Employment Protection (Consolidation) Act 1978.").
The noble Lord said: I am slightly surprised to find myself moving an amendment about redundancy upon which I can claim no expert knowledge when there are a number of experts not very far away from me. As I understand the rather wordy subsection (4) it would enable a member of staff to be dismissed as redundant simply on the grounds of expense; that is to say, he could be dismissed not because there was no longer any need for the work he was doing, but simply to enable precisely the same work to be done by someone lower down the salary scale who would therefore be cheaper. If that is right, it seems to give an odd twist to the ordinary meaning of "redundancy".
The noble and learned Lord, speaking on Second Reading, said that people would have to be shown to be genuinely redundant. It comes as a bit of a surprise to me if what we are now discussing is indeed the genuine article.
I have read the 1978 Act which provides, in shorthand, that an employee can be dismissed on grounds of redundancy if the employer ceases to carry on the business in which the individual is employed or if the requirement for the employee to carry out work of a particular kind ceases or diminishes. I believe that this means that elsewhere in the workforce someone declared redundant and then immediately replaced in the same job could claim unfair dismissal.
Am I right in interpreting this subsection as meaning that the academic could be treated differently? Are there any other employments where this somewhat surprising definition of redundancy applies? Or are academics being picked out for rather special treatment? It seems to me to strain somewhat the commonsense meaning of redundancy. I beg to move.
The Lord Chancellor: The Bill contains a definition of redundancy which includes the situation where an institution suffers financial stringency and decides that one way to meet that deficiency would be to have certain work done at a lower level than it is in fact normally done and thus save money for the university. After all, redundancies are all, in a sense, directed to saving money in a situation of financial stringency. The extension here allows for a university, where necessary, on grounds of financial stringency, to employ a junior employee to do a job previously carried out by a more senior person who would thereby become redundant.
So far as the internal procedures are concerned, that would be possible. As I sought to explain earlier, the Employment Protection Act procedures would apply thereafter, and there is no attempt to alter those. Therefore, like everyone else who is subject to
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these provisions, the academic dismissed would have that protection. The reason is that the flexibility that is required, particularly in university situations, would appear to make that proper result.
I have explained already—and it is just as well that one should say this—if a university wishes to substitute a junior member of staff for a more senior member it will have to show that it is acting reasonably in doing so. It will be on that basis, and on that basis alone, that it would be proper for the university to dismiss. I cannot stress enough the fact that academics are not deprived of the protection afforded to others by the Employment Protection (Consolidation) Act. However, the situation of redundancy which enables them to be dismissed before they get to the stage of claiming compensation or payment is more ample in its definition of redundancy than appears in the Employment Protection (Consolidation) Act.
On the other hand, that Act allows dismissal for some other substantial reason. We have not followed that, so if one is to compare the position of the academic with the position of a person covered under the employment protection legislation, one must take the whole of it. The person covered under that legislation can be dismissed not only for good cause in relation to conduct and the like, but for some other substantial reason. We have missed that out but we have made a wider definition of redundancy applicable here in order to cover the particular situation of the university.
Baroness Seear: Will the noble and learned Lord clarify the position? This is a genuine attempt to seek knowledge. I have always understood that under the Employment Protection (Consolidation) Act redundancy occurred only if the job had disappeared and there was no job left to be filled. I have heard the noble and learned Lord say that the job remains but it is simply being filled at a lower level. To give a precise example, it is that the set of lectures will continue to be given but they will be given by someone more junior and less expensive. However, there has been no change in the job. Is not the whole essence of redundancy that the job has disappeared? As the noble and learned Lord has described it, the job remains. If that is correct, how can it be redundancy?
Lord Dormand of Easington: Perhaps the noble and learned Lord will allow me to add to the question put by the noble Baroness. If someone at a lower level can be appointed to carry out the job, why was someone with higher qualifications appointed in the first place?
The Lord Chancellor: If I may say so with the greatest possible respect, that is an excellent question. The university may have a person at a high level. When financial restrictions come along and it looks round, it may ask why on earth it appointed a professor when the job could be done by a junior lecturer. Universities are fallible and they can make mistakes. The point that I made earlier is that the decision must be reasonable. It is not a case of the university arbitrarily saying, "We have a professor who we want to get rid of. Let's put a junior lecturer in his place". It must be a reasonable decision. It must also be against the background of financial stringency, looking round for savings to try to

535
preserve the real life of the university. It sees a professor giving lectures which could be given by a junior lecturer at a much lower price. That is the point.
In the ordinary case, I agree with the noble Baroness that the definition of redundancy given in the Employment Protection (Consolidation) Act is narrower than this. However, I have pointed out that one must take the whole of that Act into consideration. It allows dismissal for some other substantial reason than the specified reasons, but we have not followed that provision. Therefore one must take account of the whole situation including the fact that the employment protection legislation is still available after the dismissal.
10.30 p.m.
Earl Russell: The noble and learned Lord explained the position of the junior lecturer and the professor extremely clearly. However, when the junior lecturer grows to be a professor, does he expect to be dismissed?
The Lord Chancellor: One expects that, as he gets more expensive, he will do different work. The point that arises here is a difficult one. I speak with a certain amount of recollection, having been in universities for quite some time. I found that there was a difference between a lecturer and a professor and a lecturer and a recently appointed junior lecturer. The junior lecturer does not have the same job as the professor. The noble Earl shakes his head but this has certainly been my experience. I have listened to professors and to junior lecturers. I must say, not without exception, that I would have rather listened to the professors. As the noble Earl says, a junior lecturer gets older; he goes up the scales and he becomes a professor. The reason for his increased status is that he is doing a different job.
However, if the university discovers that it has made a mistake and that he is doing something that the junior lecturer should do and the university is in a position of financial stringency, surely it is reasonable that it should be able to take the proper steps to remedy the situation rather than cut some more vital aspect of the university's activities.
Lord Hylton: In the interests of one word having one meaning only, would it not be better to employ in this part of the Bill some such term as "redeployment of staff" rather than "redundancy"? I offer that as a suggestion.
Lord Beloff: I am terribly worried once again. I am probably the only person left in the Chamber at this hour of the night who has been both a junior lecturer and a professor and who has run what became a university. I can find no similarity in my experience of over 50 years in universities with what the noble and learned Lord has described. When first appointed to the great University of Manchester as an assistant lecturer in 1939 I was asked to take three courses of lectures. One of those was on a special subject. And a special subject lecture could have been given by a professor.
I am sure that I was not as good as a professor but it never occurred to anyone at the time to distinguish,
536
over quite a large area of the department's work, what was appropriate for a professor. One had a number of people in different grades and the work was distributed between them. It may well be true that there are in other subjects occasions to which the noble and learned Lord has drawn our attention. But it seems to me that what he has said so far strikes at the whole heart of the academic community to a much greater extent than the other matters we have been discussing today.
I implore the noble and learned Lord to take this away and ask the vice-chancellors who have much greater experience than myself of running universities or university institutions, whether they want this power and whether there is not anything they would rather do than throw into the workings of a university department discrimination of this kind. I think that this is both impractical and, if I may say so, immoral to the highest degree.
The Lord Chancellor: In the light of those observations and having regard to the time, it is only right that I should agree to reconsider this matter, without commitment.
Lord Allen of Abbeydale: In that case I should like to withdraw the amendment.
Amendment, by leave, withdrawn.
The Principal Deputy Chairman of Committees: In calling this amendment, I should point out to the Committee that if it is agreed to I cannot call Amendments Nos. 279AB or 279AC.
The Earl of Halsbury: Before moving this amendment, perhaps I may ask the noble and learned Lord the Lord Chancellor whether his comments on it are already included in his comments on the amendment of the noble Lord, Lord Allen of Abbeydale. If so, I shall not move it in order to save the time of the Committee. If he can confirm that if I look through Hansard tomorrow I shall see the comments he made, I would not want to ask him to repeat them.
The Lord Chancellor: Yes. It was grouped with that amendment. There are other considerations, but as I have taken the other amendment back I shall also take this amendment into account.
The Earl of Halsbury The Earl of Halsbury moved Amendment No. 279AA:
Page 160, line 19, leave out from ("work") to end of line 25 and insert—
("( ) Where the reason or the principle reason for a dismissal was that the member of staff was redundant within the meaning of subsection 4 but it is shown that the circumstances constituting the redundancy applied equally to one or more other members of staff employed by the same institution who held a position similar to that held by him but who have not been dismissed, the dismissal shall he regarded as unfair if—

(a) he was selected for dismissal in contravention of a customary arrangement or agreed procedure relating to redundancy and there were no special reasons justifying a departure from that arrangement or procedure in his case; or

(b) he was selected for dismissal by reason of his personal opinions or some other reason not related wholly or mainly to the activity in question.").

The noble Earl said: I beg to move.
The Lord Chancellor: I have covered most of the matters arising from this amendment. As I have taken back the amendment of the noble Lord, Lord Allen of Abbeydale, for further consideration, perhaps I may also take back this amendment.
The Earl of Halsbury: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Wedderburn of Charlton Lord Wedderburn of Charlton had given notice of his intention to move Amendment No. 279AB:
Page 160, line 21, leave Out ("or members of staff of a particular kind").
The noble Lord said: If it is agreeable to the Committee, I shall not move this amendment subject to saying a few words. The noble and learned Lord has kindly agreed to take away the definition of redundancy, as it is known in this Bill. When he reconsiders the matter, will he also take account on his agenda of the inter-relationship of three matters which it was our intention to raise under this amendment?
The first is the double redundancy definition in the Bill, as we call it; the second is the normal definition of redundancy and its effects in relation to redundancy payments and also in relation to unfair dismissal law; the third, and most important, is the relationship in employment law of the area of justification of the fairness of dismissals in the tribunals of which the noble and learned Lord said that there would theoretically be availability for such a person; the relationship between the reliance of the defendant institution employers upon some other substantial reason and its powers as expressed in the Bill—the most obvious one being that the university might use the wide double redundancy formula in order to substantiate some other substantial reason. Those are only the headings of the agenda which I otherwise had, and in view of the kindness of the noble and learned Lord in saying that he will bring this matter back on Report I shall not move this amendment.
[Amendment No. 279AB not moved.]
[Amendment No. 279AC not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 279AD:
Page 160, line 25, at end insert—
("(4A) For the purposes of this section "good cause", in relation to a member of the academic staff of a qualifying institution, means a reason which is related to his conduct or to his capability or qualifications for performing work of the kind which he was appointed or employed to do; and in this subsection—

(a) "capability", in relation to such a member, means capability assessed by reference to skill, aptitude or any other physical or mental quality; and

(b) "qualification", in relation to such a member, means any degree, diploma or other academic, technical or professional qualification relevant to the office or position held by him.").

The noble and learned Lord said: I have explained the reason for this amendment. I beg to move.
On Question, amendment agreed to.
The Principal Deputy Chairman of Committees: If this amendment is agreed to I cannot call Amendment No. 279B.
The Lord Chancellor The Lord Chancellor moved Amendment No. 279AE:
Page 160, leave out lines 37 and 38.
On Question, amendment agreed to.
[Amendment No. 279BA not moved.]
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 279C:
Page 160, line 43, at end insert—
("( ) Nothing contained in this Part of this Act shall prejudice the rights of the Church of Scotland as set out in the Universities (Scotland) Acts of 1932 and 1966, and it shall be the duty of the Commissioners to secure that the statutes of each qualifying institution shall include in relation to any ordinance which relates to the purposes mentioned in section 2 of the 1932 Act the same provisions for consultation and for consent, mutatis mutandis, as are set out in the Acts of 1932 and 1966.").
The noble Lord said: It seems odd to be speaking from the temporal Benches on a matter which concerns the Church of Scotland. The situation is that the Church of Scotland has always had, with the four older Scottish universities, a considerable relationship which predates the Reformation, was restated with the Reformation in the First Book of Discipline, and now exists to the extent that appointments to certain chairs in the faculty of divinity in the four universities are made by the universities with the consent of the General Assembly of the Church of Scotland and are controlled by the Universities (Scotland) Acts 1932 and 1966.
The purpose of the amendment is to enable that procedure to continue to the extent that this must be taken into account in any dealings on whether chairs should be redundant or the Churches should retain the right to be consulted.
Amendment No. 180A is in more general terms for any proposed Order in Council to be communicated to any university or other institution directly affected for comment. One would hope that that at least would happen anyway. There would then be a statutory provision for the Church of Scotland to make comments to the commissioners before the Order in Council is pronounced. I beg to move.
The Lord Chancellor: To deal first with Amendment No. 180A, I intend to accept in principle that something along these lines may be necessary. Precisely what is not absolutely clear, but I am prepared to undertake without any qualification that the Church of Scotland would be informed about changes connected with the chairs in which it has an interest.
The Act of 1932, which is the main one, is not affected by this Bill in regard to repeal. The right course would be to leave this to the commissioners. As I explained earlier, one reason for having the commissioners is that to fit the principles of the Bill into the constitution of the various institutions requires detailed work and adjustment. The interests of the Church of Scotland, which I wish to see very well looked after, will be taken care of in that procedure. Given that the interests of the Church of Scotland will be properly taken into account, I hope that the noble Lord may be satisfied.
Lord Hylton: In the absence of the noble Lord, Lord Grimond, perhaps I may observe that the amendment reinforces the case for Amendment No. 274B, which was moved earlier by the noble Lord, Lord Grimond.
Lord Morton of Shuna: I am obliged to the noble and learned Lord the Lord Chancellor. I shall take advice on whether it is necessary to come back on the matter. I am glad that the 1932 Act is to remain unaffected.
The necessity for consultation with the Church of Scotland does not appear on the Bill, which worries me a little. However, the attitude of the noble and learned Lord to Amendment No. 180A is helpful. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 279CA not moved.]
On Question, Whether Clause 174, as amended, shall stand part of the Bill?
Earl Russell: My chief desire is for some information. Perhaps I may raise the matter of Amendment No. 279B, which fell because the words to which it related were deleted. This is a matter of the interpretation of "good cause" for dismissal. It arises from the discussions with members of the Committee of Vice-Chancellors and Principals. The case law that has been found does not seem to establish clearly that opinions are not by themselves good ground for dismissal. One wonders whether there might be any scope for further discussion or further clarification on this matter.
10.45 p.m.
The Lord Chancellor: I indicated this afternoon in response to the amendments moved by the noble Lord, Lord Jenkins of Hillhead, that I proposed to do this very thing as in my belief this was the area in which academic freedom was most important and in which amendments were likely to be effective. The Committee did not feel able to accept that in full satisfaction of what was going on this afternoon.
I intend to continue with these consultations. I shall not be deflected from them by the fact that the amendment was carried this afternoon. It is in this area that the real thrust comes. The noble Earl's point will continue to feature in our discussions and I hope that we may have something of use on this matter at Report stage.
Earl Russell: I thank the noble and learned Lord for that reply.
Clause 174, as amended, agreed to.
Clause 175 [Powers of Commissioners]:
The Principal Deputy Chairman of Committees: In calling Amendment No. 279CB, I should point out that if this amendment is agreed to, I cannot call Amendments Nos. 279D or 279DA.
The Earl of Halsbury The Earl of Halsbury moved Amendment No. 279CB:
Page 160, line 50, leave out from ("apply") to end of line 7 on page 161 and insert ("to a person appointed to tenure or enjoying tenure before the date on which these modifications are made.").
The noble Earl said: The object of this brief amendment is to remove the retroactive effect of removal of tenure from people who received it last year. As a rule, Parliament does not like retroactive legislation. I think that the Committee should have
540
an opportunity to express an opinion on this matter. I beg to move.
Lord Peston: As a non-expert in the matter, I too have been very puzzled as to why considerations of this kind are not dated from the day that the Bill will become an Act. It has puzzled many people in the academic world, as the noble Earl said. Without wishing to delay the Committee excessively, one would like an explanation of why the day of the introduction becomes the effective date, which, to use one of our favourite words in these debates, is a little unjust in some cases. One is looking for an explanation.
Earl Russell: I should like to speak to Amendment No. 279D, which is grouped with this amendment and is designed to achieve a similar effect. It is also concerned with the retroactive provision but seeks to come at the matter from a slightly different angle.
The effect of the amendment would be to postpone the operation of the changes until university statutes are reviewed and until it is possible to indicate to somebody who is being offered a new appointment on precisely what terms and conditions such an appointment would be taken. That, as far as I can understand, is in line with normal commercial practice and I should have hoped in line with basic principles of fair play.
Lord McCarthy: I understand that we are dealing with Amendment No. 279CB. As I understand it, the amendment of the noble Earl, Lord Halsbury, would take out one category which the Government say they want to include in the coverage of the Bill. The Government say that anyone who was appointed to tenure before the publication of the Bill will be excluded but that anybody who is promoted, although he was appointed before the date of the publication of the Bill, will be affected by this provision. The effect of the noble Earl's amendment is to say that even if he is promoted he is still excluded from this provision.
I can understand why the Government may wish to resist that amendment. The problem arises if Amendment No. 279DA in the name of the noble Baroness, Lady Hooper, is moved and is successful. A subsequent amendment, Amendment No. 279EA, which I wish to move, seeks to leave out lines 9 to 12. Its aim is to make clear the Government's position, which I take to be very unclear.
I want to ask the Government whether, either at this point or subsequently when they come to debate their own amendment, Amendment No. 279DA, they are saying—the situation would I admit be changed by the noble Earl's amendment—that the Bill is not intended to cover anyone who was appointed before its publication or anyone not promoted, even if there have been increases in their increments or pay as a result of annual awards. It is by no means clear on the face of the Bill, nor is it clear as a result of Amendment No. 279DA that that is the Government's position.
The Lord Chancellor: I shall deal first with the general point. The Government's general intentions on the matter have been discussed for some time. Once the proposals were intimated, it was thought right that that should be the cut-off date. There are

541
various possible cut-off dates—one is when the Bill is enacted or commenced and another is the type of date that the noble Earl, Lord Russell, mentioned; that is, the time when the arrangements take effect in a particular university.
However, the Government thought it fair that the same date should apply to everyone and that it should be clearly intimated. Further, the provision does not come into effect at all unless the Bill becomes law. Therefore there is no question of there being anything unconstitutional about the matter. The Government are not trying to jump the gun, so to speak. It is that this will be the effect if the Bill ultimately becomes law and is passed by Parliament.
As I said, 20th November, the date of publication, struck us as being a good and fair date on which to make the change. In a way the sooner it is done the better. People will then know where they are people who are already in position at that date will know that their tenure is secure and new people negotiating after that date will know that they will not have tenure if the Bill is passed. Of course they will make their own judgment on that probability.
The Government took the view that this should be the rule, but they also took the view that appointment to new positions should not attract tenure if that appointment took place on or after 20th November. The idea behind Amendment No. 279DA that the noble Lord, Lord McCarthy, referred to is to try to clarify exactly what constitutes a new position in this respect. The details are fully set out in the amendment and I do not think that I can illuminate the matter by discussing them further, unless someone has a special point to make on them. The result is to try to define, as closely as possible what would not amount to a promotion, although it might lead to a larger salary.
Lord McCarthy: May I draw the noble and learned Lord's attention to my problem? It is quite clear. Mr. Jackson in another place said that he wished under the existing provisions of the Bill—that is, before this amendment—to describe:
"The circumstances that we regard as promotion".
He said that because promotion is to be included in the Bill and non-promotion is not to be written into it. He went on to say that the problem on the face of it is that the Bill,
"does not mention promotion specifically".—[Official Report, Commons Standing Committee J, 25/2/88; col. 1793.]
In particular, and more seriously as I see it, it fails to specify the type of increases or changes in title which academics in posts can obtain without suffering loss of tenure. Subsequently, however, members of the Government clearly said that they did not wish that provision to affect the tenure of those who will receive annual incremental increases or what they call titular improvements in their position. I cannot find that provision—that is my difficulty—on the face of the Bill or in the amendment. Perhaps I may draw the noble and learned Lord's attention to paragraph (b)(i) where the problem which appears on the face of the Bill repeats itself. The Committee will notice that the paragraph states,
"his rate of remuneration is increased to a rate which exceeds the highest point on his former pay scale at the date on which the increase takes effect".
When a pay scale is increased because a 3 per cent., 4 per cent. or 5 per cent. annual increment is
542
negotiated by the union, it is normal to refer to the new pay scales. The new pay scales come out and everyone receives a further 4 per cent. If all the people with tenure receive a further 4 per cent., could it not be argued under the terms of paragraph (b)(i) that the
"rate of remuneration is increased to a rate which exceeds the highest point on his former pay scale at the date on which the increase takes effect"?
The Government have therefore inadvertently destroyed the tenure of such persons.
The Lord Chancellor: The explanation is that the position is changed in such a way that the person receives a new rate of remuneration. That is as I understand the position. In other words "his former pay scale" relates to the pay scale that he had in the appointment he held immediately before the change.
If the only change is a change within the scales that were available to him—for example, let us suppose that there is a pay scale which has three different points, and that there is a lecturer on scale one who has done well (he will not receive tenure) who is put up to scale two (a higher scale)—that would not be a promotion for the purposes of the amendment. If his position were changed in such a way that he was given a salary which was higher than the highest grade to which he could be moved up, there would be a change. That is the idea of the provision, as I understand it, put in as simple words as I can.
Lord McCarthy: I shall give a simple example because I am worried about much simpler things. Let us take figures out of the air. There is a lecturer's scale with a maximum of £20,000; a reader's scale with a maximum of £25,000; and a professor's scale with a maximum of £30,000. They are all existing scales. They all receive a 10 per cent. Increase. They are all new scales and tenure is lost.
The Lord Chancellor: I do not believe that that is the effect of the amendment. I am happy to look at the matter again in the light of what the noble Lord has said in the interests of trying to make progress.
Lord Peston: The distinction is that of movement within a scale and movement of the scale itself. I am sure that the noble and learned Lord will be able to clarify that point for us in due course. I do not wish to delay the Committee, but I want to return to my previous point which was that introduced by the noble Earl.
During the course of the year there has been the equivalent of planning blight because of the 20th November date. Anomalies are capable of occurring. It is almost 100 per cent. certain that the Bill will become law before the start of the new academic year. The point to which 20th November refers would be better applied to 1st October, 1988, when I guess that the Bill will be law, despite the activities of this side of the Chamber. It seems to me quite reasonable to suggest that the date of 20th November—and the Government may have had good reasons at the time for introducing it—should not apply any more as we come to the end of the Bill. I am bound to say that I should be a little happier if when the Bill passes the noble and learned Lord would consider 1st October or the equivalent. I think that would get rid of a few anomalies that we heard of. That is the point I was trying to make, in a great desire to be constructive and helpful.
11 p.m.
Lord Wedderburn of Charlton: The noble and learned Lord kindly said that he would look at this again. Perhaps I may ask him to put on his agenda a simple point based on the example of my noble friend, Lord McCarthy. I think that on the explanation that he gave the Committee—this is rather important for a large number of people—it would mean loss of tenure. I take the case of a lecturer who is on the top of the scale at £20,000—the figure of my noble friend. Then there is a 5 per cent. pay increase and he gets more. From what I understood the noble and learned Lord to say, that means loss of tenure, even on his interpretation. So perhaps the noble and learned Lord could put that on his agenda.
The Earl of Halsbury: On the basis of the assurance given by the noble and learned Lord, I beg leave to withdraw the amendment standing in my name.
Amendment, by leave, withdrawn.
Earl Russell Earl Russell had given notice of his intention to move Amendment No. 279D.
Page 161, line 2, leave out ("20th November 1987") and insert ("the relevant instrument shall have been approved by Her Majesty in Council").
The noble Earl said: Before taking a decision to move this amendment, may I ask for an answer to my question? It was: is it reasonable to expect someone to accept an appointment when we cannot tell him what the terms and conditions of that appointment are?
The Lord Chancellor: It is often possible to make a bargain subject to adjustment of certain things later. The point that arises here is that 20th November has been clearly stated as the date at which tenure would be stopped. People have taken decisions, I have no doubt, in the light of that. While I see the force of what has been said, it is always possible to take account, in discussion and in deciding what to do, of the probability of action that is to happen. As the noble Lord, Lord Peston, said, people might have reached the conclusion that it was quite likely that this legislation would ultimately reach the statute book with 20th November in it.
As regards the amendments, they are in accordance with the provisions of the statute and limited in that way. So, although I agree that there are certain adjustments to be made, the essence of the changes is foreshadowed in the legislation.
Earl Russell: I cannot really regard that as a satisfactory reply. I take the point that people knew that the Bill was likely to become law. What I think most of us do not know and did not know is exactly what sort of contracts are likely to be on offer when the Bill is law. Tonight, noble Lords who are experts in labour laws have discovered that in some respects this Bill means something very different from what was said. I think that, until they know what sort of contracts can be available for them, people are being asked to buy a pig in a poke. I do not think that that is fair commercial practice. I beg to move.
11.2 p.m.
On Question, Whether the said amendment (No. 279D) shall be agreed to?
Their Lordships divided: Contents, 22; Not-Contents, 43.

DIVISION NO. 3

CONTENTS

Adrian, L.

Mackie of Benshie, L.

Airedale, L.

McNair, L. [Teller.]

Birk, B.

Mountevans, L.

Bonham-Carter, L.

Peston, L.

David, B.

Pitt of Hampstead, L.

Dormand of Easington, L.

Ponsonby of Shulbrede, L.

Ewart-Biggs, B.

Russell, E. [Teller.]

Hatch of Lusby, L.

Seear, B.

Jenkins of Hillhead, L.

Tordoff, L.

Lockwood, B.

Turner of Camden, B.

McCarthy, L.

Wedderburn of Charlton, L.

NOT-CONTENTS

Abinger, L.

Harvington, L.

Arran, E.

Henley, L.

Bathurst, E.

Hesketh, L.

Beaverbrook, L.

Hives, L.

Belstead, L.

Hooper, B.

Bessborough, E.

Jenkin of Roding, L.

Blatch, B.

Johnston of Rockport, L.

Brabazon of Tara, L.

Long, V. [Teller.]

Brougham and Vaux, L.

Mackay of Clashfern, L.

Caithness, E.

Monk Bretton, L.

Cameron of Lochbroom, L.

Reay, L.

Carlisle of Bucklow, L.

Sanderson of Bowden, L.

Carnock, L.

Skelmersdale, L.

Carr of Hadley, L.

Swansea, L.

Craigmyle, L.

Swinton, E.

Davidson, V. [Teller.]

Teviot, L.

Denham, L.

Torphichen, L.

Dormer, L.

Trafford, L.

Eden of Winton, L.

Trefgarne, L.

Ferrers, E.

Young, B.

Gray, L.

Young of Graffham, L.

Halsbury, E.

Resolved in the negative, and amendment disagreed to accordingly.
11.12 p.m.
The Chairman of Committees (Lord Aberdare): In calling Amendment No. 279DA I must inform the Committee that if that amendment is agreed to I cannot call Amendments Nos. 279E or 279EA.
The Lord Chancellor The Lord Chancellor moved Amendment No. 279DA:
Page 161, line 3, leave out from beginning to end of line 18 and insert—
("(b) immediately before that date he is paid on a scale which provides for a maximum rate of remuneration (his former pay scale) and on or after that date the terms of his appointment, or of his contract of employment, are varied (whether with effect before or after that date) so that—

(i) his rate of remuneration is increased to a rate which exceeds the highest point on his former pay scale at the date on which the increase takes effect; or

(ii) he is paid on another scale on which the highest point at the date the variation takes effect exceeds the highest point on his former pay scale at that date; or

(iii) he is paid on a basis which does not provide for a maximum rate of remuneration.

(2A) For the purposes of subsection (2) above references, in relation to a pay scale, to the highest point on the scale at any date are references to the maximum rate of remuneration payable at that date in accordance with the scale whether on a regular or discretionary basis.
(2B) Modifications such as are mentioned in subsection (2) above shall not apply in relation to a person who held an office or position at the institution in question immediately before 20th November 1987 by reason only of the fact that he is subsequently appointed to, or employed in—

545

(a) a different office or position at the institution instead of his former office or position if the terms of his appointment or of his contract of employment which relate to remuneration are the same as those of his former appointment or contract of employment; or

(b) an additional office or position at the institution which carries no remuneration.").

The noble and learned Lord said: I referred to this amendment in answer to a question from the noble and learned Lord, Lord McCarthy. It is intended to clarify in some detail the provisions about what amounts to a promotion or, in effect, a new appointment for the purposes of tenure. I beg to move.
Baroness David: Perhaps I may ask a question. If a person is promoted from lecturer to senior lecturer in the same establishment, does that mean that he or she will lose tenure?
The Lord Chancellor: Yes, unless there was simply a change of name, which is possible. However, the amendment makes it clear that if the salary change is of a kind which is described in paragraph (b), then the situation will be covered by the amendment. The mere fact that a person is called a senior lecturer does not necessarily mean that the salary is improved. If the lecturer and senior lecturer grades are quite different, the promotion to the senior lecturer grade would in the normal case mean that tenure was lost.
On Question, amendment agreed to.
[Amendments Nos. 279E and 279EA not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 279EB:
Page 161, line 22, leave out ("modifications have effect") and insert ("instrument making the modifications is approved under subsection (6) below").
The noble and learned Lord said: This amendment is to the same effect as the previous amendment. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 279EC:
Page 161, line 25, leave out ("provisions") and insert ("provision").
On Question, amendment agreed to.
Clause 175, as amended, agreed to.
Clause 176 [Procedure for exercise Commissioners' powers]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 279ED:
Page 162, line 8, at end insert—
("(6) Until the coming into force of section 115 of this Act subsection (2)(d) above shall have effect as if for the reference to the Universities Funding Council there were substituted a reference to the University Grants Committee.").
The noble and learned Lord said: Clause 176 requires the commissioners to send a copy of their proposed modifications to, among others, the Universities Funding Council. They must take into account the representations made by the UFC and others before submitting the modifications for approval to Her Majesty in Council.
The effect of this amendment is to require the commissioners to send their proposed modifications
546
to the University Grants Committee until such time as the UFC is set up under the provisions of Clause 115 of the Bill. I beg to move.
On Question, amendment agreed to.
11.15 p.m.
[Amendment No. 279F not moved.]
Clause 176, as amended, agreed to.
Clause 177 [Exclusion of visitor's jurisdiction]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 279G:
Page 162, line 10, after ("dispute") insert ("relating to a member of the academic staff").
The noble and learned Lord said: With this amendment I shall also speak to Amendments Nos. 279H, 280ZA and 280ZB. Amendment No. 279G is a purely drafting amendment. The effect of Amendment No. 279H would be to remove the jurisdiction of the visitor in all matters concerning the appointment or employment, including discipline, of a member of academic staff. That would be in addition to disputes concerning dismissal which is already provided for. In the case of Amendment No. 280ZA the use of the word "termination" rather than "dismissal" renders line 21 redundant. Amendment No. 280ZB is a drafting amendment. I beg to move.
The Lord Bishop of Winchester: Perhaps I may intervene very briefly. I rather regret that the noble and learned Lord the Lord Chancellor has spoken to Amendment No. 279H. I speak ex-officio as Bishop of Winchester, visitor of five Oxford colleges. Three of them were founded by my predecessors in office, two of them by lay people who conferred the visitorial powers on the Bishops of Winchester.
We see the role of the visitor very much as a guardian and guarantor of the founder's intention. Oxford colleges, and their counterparts in Cambridge, are very much educational trusts. They have a particular ethos of their own. The visitor's function is twofold. One function is to hold visitations. That has not been initiated by a Bishop of Winchester for over 300 years hut in the last century various colleges invited Bishops of Winchester to hold such a visitation, particularly at times of college reform. The other function a bishop has as visitor is to hold appeals. That has proved a satisfactory method in the past because it is quick to operate, inexpensive and has proved hitherto fairly uncontroversial. It is a kind of service which the visitor is able to offer the college.
In the legislation before the Committee the Bill removes the powers of the visitor in regard to cases of dismissal. I consulted the colleges of which I am a visitor. Many of the colleges regretted the fact that the visitor had no particular role. They did not seek an exclusive role for the visitor in dismissal cases but they felt that that option and service should be available to a member of staff if he or she so wished it.
The effect of Amendment No. 279H proposed by the noble and learned Lord the Lord Chancellor is to remove the visitor's jurisdiction not only in matters of dismissals but also in matters of disciplinary proceedings. I would not want to say that there

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should be an exclusive right for the visitor to act in that way but I think that there is a case for that facility being available to a member of staff who so wishes. I am fortified in that belief by the heads of colleges whom I have consulted.
I therefore rather regret that the amendment has been proposed by the noble and learned Lord.
The Lord Bishop of Ely: As Visitor of three Cambridge colleges I should like to speak a word in support of what my brother has said concerning his relationship with the Oxford colleges.
Baroness David: I should like to support the right reverend Prelates. We also think that this is unnecessary. I understand that the CVCP has been meeting the noble and learned Lord and that discussions are still going on on this subject. Is it not therefore somewhat premature to introduce the amendment at this moment?
Lord Adrian: Speaking as a member of a Cambridge college whose visitor is I believe sitting on the Front Bench opposite I would very much regret it if the jurisdiction of the visitor was limited to exclude matters other than dismissal. I accept the restriction of the exclusive jurisdiction of the visitor but I should be sorry if the amendment—and I confess I was unaware that it had that effect—removed the jurisdiction of the visitor from matters of internal discipline in the college.
The Lord Chancellor: As the noble Lord, Lord Adrian, said, there are a number of important colleges in respect of which the Lord Chancellor is the visitor, and in a personal way I am sorry that there should be any diminution of those relationships. On the other hand, one probably has to take a decision in a broad way and then apply it fairly generally. This view was taken in consequence and also because of the widening of the matters referred to in this Bill.
In view of the way that the matter has been put by the right reverend Prelate who first raised the issue, I should perhaps just mention that it is perfectly possible for, say, a college and a member of that college who wish to have a dispute decided by the bishop to agree to do so. Arbitration is always possible. In a case in which that is jointly wished, that would be possible. The difficulty is that sometimes the jurisdiction of the visitor is not wanted by one side or the other. It is to cope with that situation in particular that this amendment has been moved.
Notwithstanding the doubts that have been expressed, I hope that the Committee will feel able to accept the amendment. I shall of course convey to my right honourable friend the concerns that have been expressed tonight on this matter.
Baroness David: Do I gather that the noble and learned Lord will not convey to his right honourable friend that there have been misgivings about this matter and perhaps wait until Report stage to bring forward this amendment again after further discussion?
The Lord Chancellor: I thought that I ought to move the amendment and ask the Committee to approve it and tell my right honourable friend about
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the doubts that have been expressed. I should want him to consider them. However, I think it right to move the amendment in view of the reasons that I have given.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 279H:
Page 162, line 13, leave out from ("concerns") to end of line 15 and insert ("his appointment or employment or the termination of his appointment or employment").
On Question, amendment agreed to.
[Amendment No. 280 not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 280ZA:
Page 162, leave out line 21.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 280ZB:
Page 162, line 24, leave out ("subsection (1)(c) of that section") and insert ("section 174(1)(c) of this Act; and the reference to a member of the academic staff includes a reference to a person who is treated as such a member for the purposes of that section.").
On Question, amendment agreed to.
Clause 177, as amended, agreed to.
Clause 178 [Power to make incidental, etc., provisions by Order in Council]:
[Amendment No. 280A not moved.]
Clause 178 agreed to.
Clause 179 agreed to.
The Earl of Halsbury The Earl of Halsbury moved Amendment No. 280AA:
After Clause 179, insert the following new clause:
("Polytechnic and College Commissioners
There shall be a body of Commissioners known as the Polytechnic and College Commissioners who shall, in relation to institutions receiving funds from the Polytechnic and College Funding Council, possess the same powers and exercise the same functions as are specified in respect of the University Commissioners by sections 173 to 178 of this Act.").
The noble Earl said: In moving this amendment I have come to the last of what I call the petitioners' amendments. I think that the Committee will agree that the petitioners' amendments, as selected and edited by myself, have led to some quite lively debates in which a number of noble Lords have participated and made very relevant observations and in which the Government on more than one occasion have offered to reconsider the matter.
I hope that, since such petitions are rather rare in this Chamber, the way that I have treated this one in particular may act as a model for the serious consideration of others in the future. This amendment, which is the last of the 10 amendments, seeks to set up a body of commissioners in parallel with the university commissioners to look after the polytechnics and colleges.
At present the staff of polytechnics and colleges are less well protected from dismissal by reason of their personal or political opinions than those who work in the university sector. Cases of unfair dismissal are not unknown. Therefore it seems appropriate to take this opportunity to extend to all who work in the field of

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higher education protection in respect of their fundamental right to teach and research freely. I beg to move.
Baroness David: We should like to give our support to the noble Earl.
The Lord Chancellor: It is somewhat gratifying to the Government to find that there is so much enthusiasm for the procedures in relation to tenure that they have proposed for the universities that the noble Earl and the noble Baroness wish them to be extended to polytechnics and those other institutions which receive funds from the colleges funding council.
Notwithstanding that encouragement, it may not be necessary to make this provision because, generally speaking, the staff in such institutions do not have tenure in the form enjoyed by staff at some universitites which it has been decided to abolish. There may be general declarations of intent concerning redundancies but I am not aware of such agreements being incorporated in the contracts of employment of such staff.
Moreover, such institutions would fall within the scope of Clause 185, which prevents any tenure being provided hereafter. What is more, the articles of such institutions incorporate procedures for dismissal for good cause and for appeals which have to be approved by the Secretary of State. Clauses 173 to 179 were designed specifically to meet the particular circumstances of the university sector, and such arrangements are inappropriate and unnecessary to secure these objectives in another sector of higher education which has quite different arrangements.
With that explanation, I hope that the noble Earl will consider withdrawing his amendment.
Lord Peston: Perhaps I may use this peg on which to hang one thought which has concerned me for some time during today's debate. When we were discussing academic freedom we discussed it with respect to the universities. Those of us who believe in such freedom I assume all of us do—would assume that it would apply to the polytechnics as well. I do not know how in due course the Government will react to the amendment which was passed this afternoon, but whatever its practical consequences are I hope they will extend to the polytechnics because academic freedom is as important there as, here. I do not think that they should feel neglected. I take this opportunity to make that point.
The Earl of Halsbury: It being the hour that it is, I shall not divide the Committee on this matter. I accept the assurances of the noble and learned Lord, while reserving my position to bring the matter back again at Report stage if necessary. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clauses 180 to 182 agreed to.
Clause 183 [Grants: miscellaneous]:
The Chairman of Committees: If Amendment No. 280AB is agreed to I cannot call Amendments Nos. 280AC or 280AD.
11.30 p.m.
Baroness David Baroness David moved Amendment No. 280AB:
Page 164, line 37, leave out subsection (1).
The noble Baroness said: The purpose of this amendment is to remove the Government's new grant-making powers in Clause 183. Without any prior indication, the Government proposed at Report stage in another place four new clauses on grants. They are to be found in the Bill as Clauses 180 to 183. There was no debate on those new clauses at Report stage.
However, as they require a money order to be made there was a 45-minute debate the evening before the Report stage began. Mrs Rumbold replied on behalf of the Government and gave satisfactory explanations as to the purposes of Clauses 180 to 182. Unfortunately the guillotine came down while she was speaking to Clause 183. We wish to hear what she would have said if that guillotine had not fallen.
In the Official Report, at col. 168, on 21st March 1988, Mrs. Rumbold stated that the clause,
"redefines and clarifies the powers of the Secretary of State to pay grants to persons and bodies other than local education authorities whose activities or objects arc in the fields of education, learning or research".
She claimed that the existing powers in the Education Act 1944, Section 100(1)(b), are restricted to the payment of grants for,
"expenditure for the purposes of education services provided by the body receiving grant, or on its behalf, or under its management".
This is not strictly true as Section 100 (1) (b) also states that the Secretary of State can give grants for the purposes of educational research.
Mrs. Rumbold stated that subsections (1) and (2) enable the Secretary of State to,
"pay grant to bodies whose main purpose is the promotion of learning or research".
Examples that Mrs. Rumbold gave are the British Academy and the Royal Society. The implication of her statement is that it is considered that the Secretary of State's power to pay them grants needs clarifying so that the Secretary of State can contribute to their general running expenses as well as their educational activities.
Can we ask the Minister how much the Secretary of State already pays to the British Academy and the Royal Society and how much more he intends to pay for general running expenses once this Bill is enacted? We also want to know what else the Government may wish to grant aid under this power. The key difference between Clause 183 and Section 100 of the 1944 Act is that the Bill speaks of the,
"promotion of learning or research"
and Section 100 in the 1944 Act speaks of "educational services" and "educational research".
Examples of bodies which the Government will now have power to grant aid include bodies doing research for star wars, politically oriented research (such as the Centre for Policy Studies) or, indeed, a body to identify the political views of teachers.
The Secretary of State should not be allowed such powers with only minimal parliamentary scrutiny of the need to make regulations under subsection (2). I ask what is the procedure for making these regulations? What might a left wing Secretary of State make of such powers?
Subsection (3) amends the 1944 Act to allow the Secretary of State powers first to provide grants for expenditure connected with educational services and, secondly, grant for proposed educational provision. The power to provide grant for proposed educational services is no doubt necessary for the Government to assist the body they intend to set up to provide advice and so on for schools wishing to achieve grant-maintained status. This body was referred to in the consultation paper on grant-maintained schools issued in July 1987. Paragraph 7 states:
"The Government also intends to assist the creation of an association or trust of the DES to promote the development of grant-maintained schools".
Without the additional grant making power, it is difficult to see how the Government could financially assist such a body to come into being. Mrs. Rumbold, in the debate I referred to earlier, went as far as saying that,
"Subsection (3) redefines the group of bodies other than local education authorities that can be grant-aided and the activities for which grants can be paid"—[Official Report, Commons, 21/3/88; col. 169.]
She did not finish her sentence due to the imposition of the guillotine. Perhaps the Minister could finish it for her.
Given the general direction of the Government's desire to privatise local authority services and increase competition, these powers could be used to assist a body that wishes to set up its own educational psychological service or even speech therapy service to rival an LEA's. With government grants, in the aura of local financial management and grant-maintained schools it could well be possible for a private educational psychological service to undercut that of an LEA and thus reduce even more the overall planning function of the LEA. We want the Minister to tell us the services the Government wish to see develop through this grant-giving power which they cannot provide already through existing legislation. We should like some clarification, please. I beg to move.
Baroness Hooper: If there is life after the guillotine, I shall do my best to clarify the situation. Clause 183(1), to which the first amendment of the noble Baroness refers, is a purely technical change to existing grant-making powers intended to put beyond doubt the power of the Secretary of State to give grants to such bodies as the Royal Society and the British Academy. Since the noble Baroness asked me specifically what amounts are currently given, I can tell her that in the year 1988–89 the British Academy is due for £14 million and in the same year the Royal Society is due to have £8 million. Future levels are yet to be decided.
The change sought by the amendment to line 38 would nullify the purpose of the subsection as would the further amendment to lines 39 and 40. I think the second amendment is slightly defective. There appears to be a word missing.
Baroness David: I am sorry. I should have said that I do not intend to move that amendment.
Baroness Hooper: I was surprised by the latter amendment. It would provide a far wider grant-making power which we certainly do not seek. I hope
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that the noble Baroness will be reassured by the explanation that the intention of Clause 183(1) is purely technical in nature.
Baroness David: Could it be used to help set up grant-maintained schools? I am not clear that it cannot do many other things which the Minister has not mentioned.
Baroness Hooper: It is not part of the intention of the clause that the power should be used to fund grant-maintained schools or higher education institutions directly rather than through funding councils or anything else.
Baroness David: I shall read what the Minister has said. I am not at all sure that I am satisfied but I shall not pursue the matter at this time of night. If I wish to come back I shall do so at the next stage and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 280AC and 280AD not moved.]
Clause 183 agreed to.
Baroness Hooper Baroness Hooper moved Amendment No. 280B:
After Clause 183, insert the following new clause:
("Unrecognised Degrees.
.—(1) Any person who, in the course of business, grants, offers to grant or issues any invitation relating to any award—

(a) which may reasonably be taken to be an award granted or to be granted by a United Kingdom institution; and

(b) which either—

(i) is described as a degree; or

(ii) purports to confer on its holder the right to the title of bachelor, master or doctor and may reasonably be taken to be a degree;

shall be guilty of an offence and liable on summary conviction to a fine not exceeding level 5 on the standard scale.
(2) Subsection (1) above does not apply as respects anything done in relation to any recognised award; and for the purposes of this section a "recognised award" means—

(a)any award granted or to be granted by a university, college or other body which is authorised by Royal Charter or Act of Parliament to grant degrees;

(b) any award granted or to be granted by any body for the time being permitted by any body falling within paragraph (a) above to act on its behalf in the granting of degrees; or

(c) such other award as the Secretary of State may by order designate as a recognised award for the purposes of this section.

(3) An order under subsection (2)(c) above may designate as a recognised award either—

(a)a specified award granted or to be granted by a person named in the order; or

(b) any award granted or to be granted by such a person.

(4) Where in any proceedings for an offence under this section it is shown—

(a) that the defendant granted, offered to grant or issued an invitation relating to an award; and

(b) that an address in the United Kingdom was given in any document issued by the defendant certifying the granting of the award or containing the offer or invitation in question;

the award shall he presumed to fall within subsection (1)(a) above unless it is shown that the defendant took reasonable steps to inform the person to whom the award was granted or any member of the public or particular individual to whom the offer or invitation was addressed that the award was not granted or to be granted by a United Kingdom Institution.
(5) Where an offence under this section which has been committed by a body corporate is proved to have been committed with the consent and connivance of, or to be attributable to any neglect on the part of, any director, manager, secretary or other similar officer of the body corporate, or any person who was

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purporting to act in any such capacity, he as well as the body corporate shall be guilty of that offence and shall he liable to be proceeded against and punished accordingly.
(6) Proceedings for an offence under this section shall not, in England and Wales, he instituted except by or on behalf of a local weights and measures authority or the chief officer of the police for a police area.
(7) Nothing in this section shall apply in relation to the granting of an award to a candidate who—

(a) before 12th May 1988 began to undertake a course of education approved by the person granting the award in preparation for an examination to qualify for the award; and

(b) whether before or after that date, passes the examination;

and in this subsection "examination" includes any form of assessment and the reference to passing an examination shall he construed accordingly.
(8) For the purposes of this section—

(a)"a United Kingdom institution" means any institution established in the United Kingdom, other than one which is, or is affiliated to or forms part of, an institution whose principal establishment is situated outside the United Kingdom; and

(b) the reference to issuing an invitation relating to any award includes in particular the issuing of any circular, prospectus or advertisement relating to an award, whether addressed to the public generally, to any section of the public, or to any particular individual or individuals.").

The noble Baroness said: In speaking to this amendment I should also like to speak to Amendments Nos. 280C, 280D, 280E, 281ZA, 281CC, 286A and 288.
These four new clauses and their consequential amendments seek to protect the reputation of UK degrees. They have been tabled following wide consultations in response to increasing demands to stop the worst of the trade in worthless academic qualifications. The response to our consultation exercise held late last year was overwhelmingly supportive and strongly endorsed our long-standing desire to introduce legislation to protect the good name of the UK higher education system. I hope that they will meet with similar approval in this Committee.
Consultations confirmed our belief that the worst of the abuse was to be found in the degree field and it is here that we have concentrated our efforts. While some Members of the Committee may have wished to see protection for other qualifications, we do not believe that it would be practicable to extend our proposals to the much larger and diverse non-degree field. While a UK degree can be related to an institution specifically authorised by Royal Charter or Act of Parliament to award it, a diploma, for instance, can quite properly relate to anything ranging from a cookery course to a postgraduate qualification.
I could deal in detail with each clause if Members of the Committee wish. However, in view of the hour I shall merely say that the clauses are technical and unusual in the experience of the Department of Education and Science. That applies especially to the first clause relating to Amendment No. 280 because it creates a new criminal offence. They have one clear objective: namely, to protect the quality and good name of our higher education system. The routes to the recognition of UK degrees will in future rest exclusively on well-established processes whereby an institution is able to demonstrate not just to the wider academic community but to the world at large the quality of what it provides. I am sure that this is the way to ensure that the British higher education system remains among the best in the world and that
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its reputation is not undermined by a handful of unscrupulous operators. I beg to move.
Baroness David: We are glad to welcome these new clauses. They have been a long time coming. I understand that for the past 15 years efforts have been made to bring them into force. At last the DES and the civil servants have found a way of providing them. I understand that other countries have had such provisions for a long time.
I should like to ask the Minister one question. I understand that the local weights and measures authority will be enforcing this section. I also understand that there is now a shortage of inspectors owing to the cuts in local authority expenditure. The figures I have show that in 1983, of the establishment of 1,642, there were 85 unfilled posts because of financial restrictions. There were further reductions after the abolition of the metropolitan counties. Can the Minister tell the Committee whether more money will be provided for the officers so that they can pursue this new job?
Lord Tordoff: By some strange mistake on the part of the bureaucracy, I find my name coupled with that of the noble Baroness, Lady Hooper, on Amendment No. 286A. I think this was intended to be one of the amendments on road safety education. Nevertheless, I am very happy to be coupled with her in this particular area because this is an important one. There is some ribald laughter from the official Opposition Front Bench, which I do not understand. A number of people have been rather badly dealt with by people offering unrecognised degrees and I certainly wish to support the amendment.
Baroness Seear: My I ask the noble Baroness why weights and measures people are to examine degrees? It does not seem self evident.
Baroness Hooper: It appears that the enforcement of the provisions by weights and measures authorities was discussed with representatives of the local authority associations. There is no specific provision for additional costs, but we believe that the local authority associations felt that these were suitable bodies as they will be appropriately trained and equipped to cope with the problems.
On Question, amendment agreed to.
Baroness Hooper Baroness Hooper moved Amendments Nos. 280C, 280D and 280E:
After Clause 183, insert the following new clause:
(". Unrecognised Degrees: enforcement.
(1) It shall be the duty of every local weights and measures authority to enforce the provisions of section (Unrecognised degrees) of this Act within their area; and such an authority shall, whenever the Secretary of State so directs, make to him a report on the exercise of their functions under this section and section (Unrecognised degrees) of this Act in such form and containing such particulars as he may direct.
(2) A duly authorised officer of a local weights and measures authority may, at all reasonable hours and on production, if required, of his credentials, exercise the following powers, that is to say—

(a) he may, for the purpose of ascertaining whether any offence under section (Unrecognised degrees) of this Act has been committed, enter and search any premises which he reasonably believes may be used for or in connection with the carrying on of a business which is concerned with the granting of awards which are not recognised awards;

555

(b) he may, for that purpose, require any person carrying on or employed in connection with any such business to produce any documents or other items relating to the business and may take copies of any such document;

(c) he may require any information which is contained in a computer and is accessible from the premises to be produced in a form in which it can be taken away and in which it is visible and legible if he has reason to believe that it may be evidence of the commission of an offence under that section; and

(d) he may seize and detain anything, which he has reason to believe may be evidence of the commission of an offence under that section.

(3) In subsection (2) above "recognised award" has the same meaning as in section (Unrecognised degrees) of this Act.
(4) If a justice of the peace, on sworn information in writing—

(a) is satisfied that there is reasonable ground to believe that any documents or other items which a duly authorised officer has power under this section to inspect are on any premises and that their inspection is likely to disclose evidence of the commission of an offence under section (Unrecognised degrees) of this Act; and

(b) is also satisfied either—

(i) that admission to the premises has been or is likely to be refused and that notice of intention to apply for a warrant under this subsection has been given to the occupier; or

(ii) that an application for admission, or the giving of such a notice would defeat the object of the entry or that the premises are unoccupied or that the occupier is temporarily absent and it might defeat the object of the entry to await his return;

the justice may be warrant under his hand, which shall continue in force for a period of one month, authorise an officer of a local weights and measures authority to enter the premises, if need be by force.
In the application of this subsection to Scotland, "justice of the peace" shall be construed as including a sheriff.
(5) An officer seizing any documents or other items in the exercise of his powers under this section shall inform the person from whom they are seized.
(6) An officer entering any premises by virtue of this section may take with him such other persons and such equipment as may appear to him necessary; and on leaving any premises which he has entered by virtue or a warrant under subsection (4) above he shall, if the premises are unoccupied or the occupier is temporarily absent, leave them as effectively secured against trespassers as he found them.
(7) Section 29 of the Trade Descriptions Act 168 (penalty for obstruction of authorised officers) shall apply as respect the obstruction of an officer acting in pursuance of this section as it applies as respects the obstruction of an officer acting in pursuance of that Act but with the substitution in subsection (1)—

(a) of a reference to this section for the reference to section 28 of that Act; and

(b) of a reference to his functions under this section for the reference to his functions under that Act.

(8) Nothing in this section shall be taken to compel the production by a solicitor of a document or other item containing a privileged communication made by or to him in that capacity or to authorise the taking of possession of any such item which is in his possession.
(9) Nothing in this section shall be taken as authorising a local weights and measures authority in Scotland to institute proceedings for an offence.").
After Clause 183, insert the following new clause:
("Identification of bodies granting or providing courses for recognised awards.
.—(1) For the purposes of sections (Unrecognised degrees)and (Unrecognised degrees: enforcement) of this Act, any body for the time being designated by order made by the Secretary of State as appearing to him to be a recognised body shall be conclusively presumed to be such a body.
(2) The Secretary of State shall compile, maintain and publish by order a list including the name of every body which appears to him to fall for the time being within subsection (3) below.
(3) A body falls within this subsection if it is not a recognised body and either—
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(a) provides any course which is in preparation for a degree to be granted by a recognised body and is approved by or on behalf of the recognised body; or

(b) is a constituent college, school or hall or other institution of a university which is a recognised body.

(4) In this section "recognised body" means a body falling within section (Unrecognised degrees) (2)(a) or (b) of this Act.").
After Clause 183, insert the following new clause:
("Unrecognised degrees: Northern Ireland and Channel Islands. 1974 c. 28.
.—(1) An Order in Council under paragraph 1(1)(b) of Schedule I to the Northern Ireland Act 1974 (legislation for Northern Ireland in the interim period) which contains a statement that it is only made for purposes corresponding to the purposes of sections (Unrecognised degrees), (Unrecognised degrees: enforcement) and (Identification of bodies granting or providing courses for recognised awards) of this Act—

(a) shall not be subject to sub-paragraphs (4) and (5) of paragraph 1 of that Schedule; but

(b) shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(2) Her Majesty may by Order in Council direct that those sections shall extend to any of the Channel Islands with such adaptations and modifications (if any) as may be specified in the Order.").
On Question, amendments agreed to.
Clause 184 agreed to.
Baroness Hooper Baroness Hooper moved Amendment No. 280EA:
After Clause 184, insert the following new clause:
("Extension of functions of Audit Commission.
.—(1) The Audit Commission for Local Authorities in England and Wales (the Commission) may, at the request of the appropriate body, promote or undertake studies desiened to improve economy, efficiency and effectiveness in the management or operations of the Polytechnics and Colleges Funding Council, a higher education corporation or the governing body of a grant-maintained school.
(2) For the purposes of subsection (1) above "the appropriate body" is—

(a) with respect to studies relating to the Polytechnics and Colleges Funding Council, the Council;

(b) with respect to studies relating to a higher education corporation, that Council or the corporation; and

(c) with respect to studies relating to the governing body of a grant-maintained school, the governing body.

(3) The Commission may, at that Council's request, give the Council advice in connection with the discharge of the Council's functions under paragraph 18(2)(h) of Schedule 5 to this Act.
(4) The Commission may, at the request of a higher education corporation or the governing body of a grant-maintained school—

(a) advise them in connection with the appointment of persons to audit their accounts; and

(b) arrange for their accounts for any financial year to be audited by such of the Commission's officers as the corporation or governing body may appoint.

(5) References in subsection (4) above to the accounts of a higher education corporation include references to any statement of accounts prepared by the corporation under paragraph 18 of Schedule 5 to this Act.
(6) The Commission shall charge the body at whose request any services are provided under this section such fees as will cover the full cost of providing them.").
The noble Baroness said: This amendment extends the powers of the Audit Commission so that it may, if requested to do so, provide services to the PCFC, the new higher education corporations and grant-maintained schools. The powers were foreshadowed in the DES consultative document on Accounting and Auditing in Higher Education. It is eminently sensible to make the commission's expertise available in this way and I commend the amendment to the Committee. I beg to move.
Lord Peston: We welcome this amendment. I should like to ask two questions, simply to see how the Government's mind is working. It is the converse of an earlier amendment. Why is the UFC not included under this heading? Why should it not be able to call on the Audit Commission, since on both sides of the House we strongly approve of the Audit Commission and its work? Similarly, while I notice that grant-maintained schools come under this heading, why have CTCs been left out? I do not want to detract from the amendment, of which we strongly approve, but I am interested to know the reason for those two limitations.
Baroness Hooper: Perhaps the noble Lord will accept that I will write to him to clarify this
matter.
On Question, amendment agreed to.
Clause 185 [Avoidance of certain contractual terms]:
The Minister of State for Defence Procurement (Lord Trefgarne)The Minister of State for Defence Procurement (Lord Trefgarne) moved Amendment No. 280EB:
Page 165, line 45, at end insert ("in their capacity as such an authority").
The noble Lord said: On behalf of my noble friend, I rise to move Amendment No. 280EB and to speak at the same time to Amendments Nos. 280EC and 280FB. These are essentially tidying up or clarificatory amendments. If your Lordships would like a five minute blast, I shall by happy to give it. In the meantime, I beg to move.
On Question, amendment agreed to.
Lord Trefgarne Lord Trefgarne moved Amendment No. 280EC:
Page 166, line 2, leave out from ("them") to ("not") in line 3.
On Question, amendment agreed to.
[Amendment No. 280F not moved.]
Lord Trefgarne Lord Trefgarne moved Amendment No. 280FB:
Page 166, line 18, leave out ("a university") and insert ("an institution falling within section 173(3) of this Act").
The noble Lord said: I beg to move.
Lord Peston: Am I right in understanding that this is a technical amendment, because if it is not I do not understand it?
Lord Trefgarne: The noble Lord is quite right.
On Question, amendment agreed to.
Clause 185, as amended, agreed to.
Clause 186 [Application of employment law during financial delegation]:
[Amendment No. 280FC not moved.]
11.45 p.m.
Baroness David Baroness David had given notice of her intention to move Amendment No. 280FCA:
Page 166, line 25, after ("order") insert ("after consultation with the local authority associations, any local authority directly concerned and any organisations of employers affected").
The noble Baroness said: I should just like to make a few comments on the clause. We feel that it is an extremely important clause and we have very serious concerns about it. I do not intend to move the
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amendments in my name but I should like to say that we shall return to this matter in much greater detail at the next stage of the Bill.
We have three concerns: first, the extent of the powers given to the Secretary of State; secondly, that the order made under this clause will not be subject to further positive parliamentary scrutiny; and thirdly, that the potential for abuse is considerable. Priority must be given to protecting the rights of individual employees, and the powers given under the clause could be used to deprive them of the rights given to them by Parliament in legislation.
Government Ministers have declared that that is not the intention, but Parliament has a duty to protect individuals from government abusing delegated power, and the statutory rights of individuals should be protected by clear reference in the clause. Therefore, I shall not move the amendments in my name but I give notice that I shall be returning to this matter at the next stage of the Bill and hope to spend a considerable time on this clause.
[Amendment No. 280FCA not moved.]
[Amendment No. 280FCB not moved.]
The Chairman of Committees: If Amendment No. 280FD is agreed to I cannot call Amendment No. 280FDA.
[Amendments Nos. 280FD to 280FDC not moved.]
[Amendment No. 280FE had been withdrawn from the Marshalled List.]
[Amendment No. 280FF not moved.]
Lord Dormand of Easington Lord Dormand of Easington moved Amendment No. 280FG.
Page 166, line 33, at end insert ("Provided that the rights of employees are not thereby diminished or otherwise adversely affected.").
The noble Lord said: I apologise because of the late hour for making a slightly longer speech than those which have been made in the last few minutes, but Clause 186 represents to employees in the education service perhaps the most disturbing single feature of the Bill. It appears to be something of a drafter's afterthought inserted in as Clause 139 of the Bill as originally published upon the late realisation that the Bill's proposals for the local financial management of schools and higher and further education institutions could have serious consequences for employment law.
The clause was later drawn in the widest possible terms to permit the Secretary of State for Education and Science to modify any enactment relating to employment as he considers necessary or expedient—and I have to say I am afraid of the word "expedient"—to give effect to delegated financial management. The scope of the legislation—and I am sure Members of the Committee already appreciate this—that falls under this clause is vast. It includes the Employment Protection Act 1975, the Employment Protection (Consolidation) Act 1978, the Equal Pay Act 1970, the Sex Discrimination Act 1975, the Race Relations Act 1976, and the Health and Safety at Work Act 1974. I am sure that that recital gives an indication of the widespread probable effect of the clause—and more, as my noble friend says.
All these measure and their precursors were the subject of protracted public and parliamentary debate, consultation and indeed controversy. They have generated a vast quantity of subsiduary legislation. If enacted, Clause 186 would enable the Secretary of State—he and his predecessors were not responsible for the legislation in question—to modify the many and varied rights of employees in schools and higher education institutions, subject to delegated financial management whenever and however he may think fit, checked only by negative resolution of both Houses. By any standards, that is appallingly bad law. That a government should contemplate giving such vast power to a Secretary of State is an insult to the authority of Parliament. The need for such a clause is doubtful.
The scheme of delegated financial management contemplated by the Bill gives powers to governing bodies of schools covered by delegated financial management that would normally be regarded as the powers of employers. By Schedule 2 in particular, governing bodies would have effective powers of hiring and firing. I take it that that is not in dispute. However, the employers of teaching and other staff in the affected institutions would remain the local education authorities except in the voluntary aided schools where presently teachers are employed by the governing bodies, subject to restraining powers vested in LEAs under Section 24 of the Education Act 1944.
Employment protection rights would remain enforceable against these employers. This being so, assuming that LEAs would retain powers to control governing bodies at least to require that the governing bodies act within the law in relation to LEA employees, it may be that Clause 186 is simply unnecessary. However, it may be necessary for clarification purposes to ensure that governing bodies clearly have the same duties as employers.
As yet, it seems that no one has thought through in detail how the employment legislation might need modification even for the benefit of employees. The Minister of State has given bland assurances of the Government's good intent, and positive intentions are expressed in the Government's own brief briefing on the clause for Members of the Committee. I have some quotations from the Minister of State, but in view of the lateness of the hour perhaps the Committee will accept the statements made in another place. Those serve to show only how ill-considered the measure is.
The Government are not unsympathetic to demands for relaxation of the employment protection laws in favour of employers, and have relaxed them for small businesses. The clause would enable the Secretary of State of modify employment protections laws for school and college staff in ways as yet unforeseen if some rule were found to be in his view an obstacle to the kind of delegated financial management that he wants to see in operation. The clause will affect most school and college staffs, and will probably affect all in due course.
Delegated financial management will apply to all secondary schools and to primary schools with more than 200 pupils in the first phase. However, the Secretary of State will have power by order to extend this application to all schools. As the Committee will
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know, this is contained in Clause 33(1). Strenuous efforts were made in another place to modify the Bill on this point. We on this side of the Committee seek amendment of Clause 186 which does not attack the structure of DFM but nonetheless seeks to make Clause 186 acceptable in isolation. The amendment would limit the effect of the clause to that which the Government claim to be its true intention. The debate on the amendment should therefore at least be a test of the Government's protestations about the innocence of their proposal. On that issue we look forward to the reply.
Clause 186 is disturbing not only for school and college staffs but for the law-making process. If enacted, it could operate as a precedent for moving law-making power even further in favour of government and away from Parliament. The Government will no doubt deny that, but we on this side of the Committee feel that the implication is quite clear.
There have been suggestions that the clause is necessary to overcome the alleged difficulty of getting rid of incompetent teachers. That this difficulty exists is a myth. Teachers have no more statutory rights than other employees, and every LEA has negotiated dismissal procedures. Any complications which exist in these procedures derive from the fact that at least since 1944 governing bodies have had a role to play and an influence to bring to bear upon LEAs which employ teachers.
The Government intend to enhance their role, not diminish it, and therefore the Government's proposals add to the complications. Perhaps I may say that as an education officer I had considerable experience in dealing with governing bodies. Some of the proposals in the clause and in other parts of the Bill highlight the difficulties that may arise. Clause 186 has nothing to do with this. Schedule 2 to the Bill deals with the dismissal powers of governors in DFM schools. Clause 186 cannot be justified on this ground.
The amendment is not so much concerned with getting rid of teachers as with appointing them. We have all had letters on this aspect of the Bill. I should like to quote from one letter by way of illustration. It came from a head teacher in Essex. She said:
I would ask you to support the deletion of Clause 186. We have a very serious problem over teacher recruitment and retention and we will need even more teachers to fulfil the needs of the national curriculum in the Bill. If this clause is passed, I am sure fewer people would even consider teaching as a career because this will be a sword held over their heads".
There speaks the practical voice straight from the school—no academic or theoretical argument there. I wonder to whom the Secretary of State was listening when he drafted the clause.
Ministers have given repeated assurances in another place that employees' rights will be safeguarded. At the centre of this debate is the fact that these issues are far too important to be dependent on verbal assurances given during debate. Naturally we welcome the assurances, but the very wording of Clause 186 is such as to create doubt not just about those promises but even whether genuine assurances could be carried out in certain circumstances. Ministers' intentions may well be what they have said, but that is not what the clause says, or, I venture to suggest, how a court might interpret it.
The widespread concern among all kinds of employees in the education service must be allayed. I believe that the straightforward and unequivocal nature of the amendment meets the real assurances being looked for by so many people. I commend the amendment to the Committee. I beg to move.
12 midnight
Lord Trefgarne: I want to make it quite clear that this clause is not about diminishing employees' rights, or adversely affecting employees. Rather, the clause is about ensuring that power and responsibility for the governing body go hand in hand. Where the governing body takes a decision, it, rather than the local education authority, must be answerable for it. Employees must be able to claim and enforce their rights against the governors. The amendment is therefore unnecessary, as the clause is not about diminishing employees' rights.
The addition of such wording to the Bill would also be unacceptable as it could well lead to disputes about what constitutes diminution in employees' rights and when these rights are adversely affected. For example, some people might be tempted to claim that simply having decisions taken at school level rather than LEA level is a diminution of rights. We do not accept that. We make no secret of the fact that many decisions will be taken at school or college level under financial delegation, and that employment rights should therefore be seen to operate at the school level.
The power for a Secretary of State to amend employment legislation by order is hardly unprecedented. Section 149 of the 1978 Employment Protection (Consolidation) Act, passed by a Labour Government, gives the Secretary of State wide powers to modify and vary the operation of numerous parts of that Act by order. The section contains no provision that such modifications must not diminish employees' rights and no provision for formal consultation. We are therefore already giving assurances on the Bill which go well beyond those in the 1978 Act passed by the Labour Government at that time.
I hope that in the light of those considerations, the noble Lord will not wish to press his amendment.
Baroness Seear: The Minister has not addressed a central point of great importance. The contract of employment is with the local authority. Therefore, when there is any grievance about the employment conditions of the employee, the action must be against the local authority because that is the body which makes the contract of employment.
The matter was most usefully raised by the noble Lord, Lord Irvine, in connection with the application of the equal-value clauses over equal pay. I know that it is not the right moment to raise the matter but it is of central importance. The Government must clear it up.
I do not know whether the Minister realises that the answers we received the other night showed that the Government had simply not thought about it. Therefore, will the Minister say that he will take it back and, in the light of what was said by the noble Lord, Lord Irvine and, indeed, what has been said tonight, at least look at the conflict here between the body with which the employee has the contract of
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employment and which therefore is legally responsibile for whatever happens—there is no way that that situation can be altered—and the fact that he is giving the right to make the decisions in employment to the governing body with whom the contract is not made?
Lord Trefgarne: As has already been said, this matter was discussed at great length the other night—
Baroness Seear: It was not discussed at great length. We received no answer whatsoever to the question about how the equal-value clauses were going to be applied. That is absolutely essential to the whole issue. Surely it is in the interests of getting the legislation straight. It is not a party point. The issue has not been thought through and it is a matter of some considerable importance.
Although this is not the right moment to discuss the matter further, I urge the noble Lord to take it back and, in the light of the discussions which took place the other night, bring forward an answer on Report.
Lord Trefgarne: I can only repeat that the matter was discussed the other night. Of course I recognise that the noble Baroness did not receive an answer which she found to be satisfactory. I am sorry about that. Many staffing decisions will be taken by governing bodies of schools and colleges, with financial delegation, even though—as the noble Baroness said—the LEA will remain the employer of staff, other than in aided schools. It is right therefore that the governors should be accountable for the management decisions they take. Indeed, that is what Clause 186 is about. We did have representation from LEA interests concerned that LEAs might be held to account for an unfair dismissal, for example, when they had had no control over whether the person was dismissed.
However, such interested bodies were reassured when they were told that the governing body will have to respond for its actions before an industrial tribunal because of the operation of Clause 186. I hope that the noble Baroness will understand that there is a difference in perception of this matter here. I fear that it is one that will be most difficult to resolve at this late hour.
Earl Russell: I must remind the noble Lord, Lord Trefgarne, that it is not easy to subdue criticism from these Benches by saying that the Labour Government did it before. I listened with great interest—
Lord Trefgarne: I hope that the noble Earl will not mind my reminding him that the Lib-Lab pact was in force at that time.
Baroness Seear: What has that to do with it?
Earl Russell: One does not necessarily involve every party to a somewhat informal pact in every act that was done in every detail on every platform during its operation.
I also should like to ask the noble Lord, Lord Trefgarne, about the clause. I listened with great interest to what he had to say. It sounded wholly reasonable. With respect it is not what the clause

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says. The noble Lord said that the clause was concerned with who was to be responsible. The clause says a great deal more than that. It states:
"The Secretary of State may by order make such modifications in any enactment … conferring rights on employers … as he considers necessary or expedient".
The noble Lord, Lord Trefgarne, said that it is not intended to diminish the rights of employees. The amendment says the same. Why not agree to it?
Lord Trefgarne: I can only add that with regard to the order-making power an assurance has been given that on Report we shall bring forward an amendment to require that there be statutory consultation before any order is made. That consultation will involve local authority employers, trade unions and the bodies representing the interests of the governors of voluntary schools.
Lord McCarthy: I hope that the noble Lord will not take it wrongly if I say that we have heard him in a familiar strain this evening. It is a familiar strain which has not been so familiar this evening. It is a strain which says that that which is irrestible on logical grounds can always be opposed on the grounds that it is unnecessary.
The noble Lord says that the amendment is unnecessary because Clause 186 is not about reducing the rights of employees. We say again what we have said to him on so many occasions. If the clause is not about reducing the rights of employees and if so many people, including representatives of the National Union of Teachers and other teachers' unions, fear that it may be about reducing the rights of employees or that it may be used subsequently to reduce the rights of employees, for goodness sake what is wrong with saying so, as that is the Government's intention?
What is wrong with including at the end of the clause the modest declaratory amendment which my noble friend Lord Dormand wants? The need for the clause has never been made clear by the Government here or in the other place. They have retreated into ambiguity. The fact is that Schedule 2 specifies that the governors have the power to hire and fire. Therefore, the implication of the Bill is that many of the LEA's day-to-day responsibilities will in effect be the responsibilities of the governors.
The Bill makes it clear that the LEAs remain the employers. They are ultimately responsible if people are unfairly dismissed; they are ultimately responsible if health and safety regulations are not observed. The ways in which the Government require modifications to the existing employment Acts are never made clear to us. They are not specified on the face of the Bill.
All right, we do not complain about that if the Government are prepared to say that they will add to the Bill a simple, modest statement that these unjustified and vague commitments are not something to worry about, because they are not intended to undermine the existing rights of employees. For the life of me, I cannot see why the noble Lord resists this at this time of night.
Lord Trefgarne: I am afraid that the hour of the night does not hide the fact that to add such a
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declaration would not be a very good idea. It would open up a whole field of useless and undesirable conflict on, for example, what constituted a diminution in employees' rights or when such rights had been adversely affected. I do not believe that that is what the noble Lord has in mind and I am afraid that I cannot agree to the amendment.
Lord Dormand of Easington: The hour of the night affects this because we do not want to press the amendment to a division. But I am sure that the noble Lord has seen the depth and intensity of the feeling on these Benches about the situation which might arise through this clause. I have to say that the reply was extremely unsatisfactory. The Minister skirted round the central point of dispute, he did not deal with it in any shape or form. He is repeating the kind of—I was going to say "bland assurances" but I shall not say "bland"—assurances which have been given in other parts of this Bill. I cannot resist telling the Committee about one of the statements of the Minister of State in another place. I said that I would omit it, but in view of what has been said I found this quite hilarious, though I know that the noble Lords opposite will not find it so. When a similar amendment was being debated in another place, Mrs Rumbold said this:
"If the amendment were accepted, Sections 23 and 24 of the Employment Protection (Consolidation) Act 1978 could not be amended and employees could not have protection-"
I emphasise this-
"against governors trying to deter them from being in a trade union".
I do not want to go into the four or five anti-trade union Acts, but if that is the kind of thing that is being said, frankly, though I hesitate to say it, we cannot trust some of the things being said. We feel very strongly about this and I wonder whether, even now, we could have an assurance from the Minister that he will have another look at the situation.
Lord Trefgarne: I think I have gone as far as I can with the assurances that I have offered. For example, I have repeated the assurance about the statutory basis upon which we propose to make the consultation and that we shall ensure that it is properly and sensibly conducted under the auspices of the Bill, with the local authority associations, organisations representing teaching and non- teaching staff and bodies representing the interests of governors of voluntary schools. I hope that the noble Lord will accept the assurance that I give that there is no secret purpose behind this clause in any way adversely to affect the rights of employees. On the contrary, we want to see those rights properly secured, and this clause is intended to achieve that.
Lord Peston: Perhaps I may make one point. I think there is a difference between whether there is a covert agenda here and the technical point raised by my noble friend Lord Irvine the other night and by the noble Baroness, Lady Seear, now. It is a point which is worthy of reasoned argument. We shall not go into it now because I think we are all very tired, but I must reiterate the point raised by my noble friend Lady David. We shall discuss the whole of that clause in some detail on Report, but we shall not pursue it now. I think the noble Lord should not be under any illusion: we think there are serious technical sides to this as well as other matters.
Lord Dormand of Easington: My noble friend has said something similar to what I intended to say. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 280FH to 280FK not moved.]
Clause 186 agreed to.
Clauses 187 and 188 agreed to.
12.15 a.m.
Baroness Young Baroness Young moved Amendment No. 280G:
After Clause 188, insert the following new clause:
("Assistance to education of children of British nationality residing for the time being outside the United Kingdom in another member state of the European Community.
.—(1) For the purpose of facilitating the free movement of families to take advantage of employment opportunities within other member states of the European Community, the Secretary of State shall take action as specified in subsection (2) to (5) below to assist in maintaining and improving educational standards at British schools situated within other member states and to facilitate access to such schools by the children of British expatriates for the time being residing and working in those states.
(2) The Secretary of State shall establish a category of school situated in another member state of the European Community having such characteristics as are specified in subsection (3) below and in regulations which he may make.
(3)The Characteristics mentioned above are that the school—

(a) provides education for pupils who have attained the age of five but not the age of nineteen years and are of British nationality but are residing in another member state of the European Community; and

(b) has a curriculum approved by the Secretary of State and which is broadly similar to the curriculum the pupil would follow if receiving an education in England and Wales.

(4) For the purpose of maintaining and improving the standard of education at such a school, the Secretary of State shall—

(a) make arrangements for the inspection of such a school at appropriate intervals by H.M. Inspectors of Schools, with the school being responsible for the Inspectors' travel and local expenses;

(b) provide on a regular basis to such a school information on educational development in England and Wales and also facilities such as in-service training for teachers as he may consider necessary or desirable to enable the school to continue to offer an education broadly comparable to that available in England and Wales; and

(c) take such measures as he deems appropriate to facilitate the recruitment of British teachers by these schools and in due course their re-employment in the United Kingdom.

(5)The Secretary of State shall make an order to establish a Grant Scheme for the purpose of enabling children of parents of British nationality for the time being residing and working in another member state of the European Community, who might otherwise not be able to do so, to benefit from an education at a school in the category described in subsection (2) above and so facilitate their return to a school or institute of higher education in the United Kingdom.").
The noble Baroness said: At this late hour I shall speak briefly to this amendment but it is one that I regard as of very considerable importance to us as a country. It is important now and it will be even more important after 1992. The problem with which the amendment tries to deal is that of the education of children of British families working in the European Community who want for their children what might be generally described as a British education. I do not think I need to explain that to the Committee after all the detailed discussion that we have had. I hope that all Members of the Committee will take an interest in this important matter, and I would draw attention to the very valuable report that has been produced on this subject by Sir Mervyn Brown, a former member of the Foreign and Commonwealth Office, which has
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very wide terms of reference and sets out in considerable detail exactly what the problem is.
My amendment is concerned with British schools in Belgium, France, the Federal Republic of Germany, Greece, the Netherlands and Italy. There are other British schools both in Sweden and Switzerland but I do not refer to them because they are not within the European Community. Very broadly speaking they educate about 8,000 children of whom about half are British. They are all independent schools supported by fee paying parents. They are inspected by Her Majesty's Inspectorate and they themselves pay for this service.
In an attempt to find out what the expatriate community working in the European Community does for the education of its children the report refers to a survey carried out of some 2,000 British people working in the Community. It showed that just under 50 per cent. send their children to a local British school, about 11 per cent. send them to a boarding school in the United Kingdom, about 21 per cent. send their children to European international schools and about 21 per cent. to local national schools in the country in which they are employed, although there is some reason to think that the latter figure is considerably higher than that. Interestingly, there was a widespread rejection of boarding schools as a solution to the education of the children, particularly among younger parents. This was shown up in a majority of approximately 20:1 in the question that was asked.
British people working in the Community want a British type education because they want their children to enjoy the continuity of a British education. They recognise particularly of course in the teenage years—13, 14 and 15—the importance of qualifications such as GCSE and A-level examinations for university entrance and for other forms of higher education. The problem arises because, although some employers will pay for the education of the children in these schools and some people will be able to afford school fees, there are quite a number of families who are not able to afford the fees at all and the fees represent quite a considerable sum of money.
If we look in the European Community to see what other countries are doing we discover that France, for example, spends something like £130 million annually on the education of French children abroad, the Federal Republic of Germany some £90 million and Italy some £12 to £13 million. The effect of this money is to provide their children living abroad with an education similar to that which they would have enjoyed had the families been working in their country of origin. Thus a French education for a French child in London costs abot £1,000 a year and about £800 in Brussels. A British type education for a British family living abroad costs some £4,000 to £5,000 a year in either Brussels or Paris.
We have all heard a great deal about 1992. We have read of the great campaign that has been conducted by my noble friend Lord Young of Graffham. I think that everyone agrees the importance of that and what it will mean. I hear myself speaking in the Chamber about the Single European Act which I took through when I was a Minister in the Foreign and Commonwealth Office. What we are doing by not helping our own children abroad is handicapping our

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people in Europe. Any businessman going abroad will ask as one of his first questions, "What about the education of my children?". The education of some children will be paid for. Some parents will be able to afford such an education for their children; others will be left out.
The object of the amendment is to draw to the attention of the Minister and her colleagues, and also rather more widely to my colleagues in the Department of Trade and Industry, that there is a real problem. The amendment sets that problem out. It also offers a solution. That may not be the best solution. However, a solution is required. I have set the amendment out as a first draft. The problem will not go away. It will only get worse. I have put the amendment down because I believe this to be an important matter. It needs to be addressed by the Government as a matter of urgency. I beg to move.
Baroness David: My name also appears in connection with the amendment and I should like to add my support. There is a very real problem and I hope that if the particular solution is not acceptable to the Government they will come up with another solution.
Lord Reay: I hope also that the Government will consider seriously the point which my noble friend Lady Young has made. I can see that the Government may not wish this new subject to be brought into the Bill at this time. However, my noble friend has put her finger on a wrongfully neglected field and I hope that they will reflect on the matter and come up with proposals to remedy the defect.
As my noble friend pointed out, the Government are enthusiastically encouraging British industry to venture out into the Community and to treat the rest of the Community as a single market. Surely the Government should try to make it less difficult and less expensive for those who heed their call by going to live in the Community or sending others to do so to provide a British education for their children. Perhaps a fund should be established to assist the financing of education for those who are eligible at the existing independent schools. Perhaps there is another way. But the Government should concern themselves with the problem.
Other major countries pay attention and devote considerable resources to educating the children of their nationals abroad. We concern ourselves with that problem if our nationals are public servants stationed overseas in the diplomatic service or in the armed services. However, we do nothing for private citizens. At a time when the Government have rightly sought to underline the importance of the private sector in our national life, surely they would find it quite philosophically comfortable to try to do something to satisfy the needs of our businessmen and their employees in the field. I hope that the Minister will be able to promise some consideration for the subject in the future.
Lord Tordoff: I speak, first, as someone who has spent many years working for a multinational corporation that is 60 per cent. Dutch and, secondly, as a member of a party which has a total commitment to the European ideal. Therefore, although there are no names on the amendment from these Benches, we thoroughly support it.
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Another aspect which is singularly lacking in the Bill is any recognition of the existence of the international baccalaureate, which I believe is something we need to take much greater notice of. The amendment so ably moved by the noble Baroness has our full support.
The Earl of Bessborough: At this late hour I should just like to say that I support wholly what my noble friend Lady Young has said and also what my noble friend Lord Reay has said. I do not want to repeat what they have said but, having been connected with many European institutions within the European Community, I know many of these families and I hope that the Government will take the amendment very seriously. I could almost have thought that the Government might have drafted it.
Baroness Hooper: I am grateful to my noble friend for the informative way in which she introduced the amendment.
The Government recognise that British-type schools abroad provide a valuable service for British citizens working overseas and other expatriates who wish to keep their families with them and to have their children educated in a way which minimises the difficulty of subsequent transfer to education in Britain itself. In that context, we welcome the efforts of the Council of British Independent Schools in the European Communities (COBISEC) and we shall continue to offer as much encouragement and practical help to these schools as we can.
The proposed new clause invites the Secretary of State to create a new category of independent school abroad. However, unlike the position in regard to independent schools in England, the Secretary of State would not have power to require registration or to secure any necessary improvements in the provision offered. The Secretary of State would therefore be assuming a responsibility without the power to discharge it and a responsibility which would have to extend to all independent schools abroad capable of meeting the criteria set out.
Turning to the detailed proposals set out in paragraph (4) of the proposed new clause, some of those measures are already the subject of informal arrangements agreed between COBISEC and the Department of Education. The proposal as regards HM Inspectors would in effect formalise the existing practice except that a charge is made—and would have to continue to be made—to cover the cost of HMI's time. Similarly, the department already sends copies of circulars and other relevant publications to COBISEC, and intends to continue to do so.
There are a number of points which I might have made. However, I hope that with these few remarks I have indicated the warmth of the Government's regard for British schools in the European Community, our recognition of their value and our willingness to help in practical ways wherever possible. Nevertheless, we remain unconvinced that it would be sensible for the Secretary of State to establish them as a special category of school at this stage. I trust that my noble friend will not feel it necessary to press the amendment.
Baroness Ewart-Biggs: I should like to add a word of support for the amendment of the noble Baroness. I am disappointed that the noble Baroness, Lady

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Hooper, has not responded more positively to the suggestion. There is no doubt that more families will move into the European Community to work, and more families who are unwilling to part from their children and for whom it is an alien idea to send their children back to boarding school in the United Kingdom. As the noble Baroness, Lady Young, said, if we really want to encourage people to work in the Community, in addition to those glossy brochures there must be a leaflet setting out the educational possibilities.
It is an enormously important and very timely change that the noble Baroness is suggesting. It would be a response to the needs of a growing number of families who find themselves working in the Community. I think that it is very disappointing that the noble Baroness, Lady Hooper, has not made a more positive response.
Baroness Young: I am very grateful indeed for the support I have received from all parts of the Chamber. I am particularly grateful to the noble Baroness, Lady David, and the noble Lord, Lord Tordoff, and to my noble friend Lord Reay, who I think made an extremely important point about the Government supporting the private sector, particularly the smaller business and the self-employed, who will be most affected.
I must say to my noble friend Lady Hooper that I am grateful for the points that she made about the British schools. However, the point which she and her colleagues must take on board is not so much the warmth towards British schools but the help that will be required by British people working in the Community. If we really want to handicap people going to work in Europe we are going the right way about it by not doing anything to help with the education of their children.
I do not intend to press this amendment at this time of the night, nor shall I advance the argument further, though I am somewhat tempted to do so because I know that it has a lot of support. However, I give notice that I shall return to this matter, if not at a later stage in the Bill then at a later stage in this Parliament, because I think that it is far too important a matter just to let drop. I hope that my noble friend will look carefully at what has been said and reflect further on the matter. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
12.30 a.m.
Baroness David Baroness David moved Amendment No. 280H:
After Clause 188, insert the following new clause:
("Race Relations: (Codes of Practice).
. In Part VII of the Race Relations Act 1976 (Codes of Practice) after section 47 there shall be inserted—
"47A—The Commission may issue codes of practice containing such practical guidance as the Commission think fit for eliminating discrimination in the field of education; and subsections (2) to (11) inclusive of section 47 shall apply with the following modifications:

(i) the obligation to consult under subsection (3) shall be with such organisations, or bodies, as appear to the Commission to be appropriate having regard to the contents of the draft Code;

(ii) for the references to an industrial tribunal in subsection (10) there shall be substituted references to a county court or a sheriff court as appropriate.".").

The noble Baroness said: This is a new clause and its purpose is to amend Section 47 of the Race Relations Act so as to extend the Commission for Racial Equality's code-making powers to the field of education.
Under Section 47 of that Act the commission has the power to issue codes of practice for the elimination of discrimination in the field of employment. So far it has issued one such code, which, after extensive consultation, was presented to Parliament and approved by the Secretary of State in April 1984. As a result of that procedure the employment code represents a greater degree of consensus and carries more weight than ordinary guidance documents.
In its review of the Race Relations Act submitted to the Home Secretary in June 1985 the commission recommended that its code-making powers should be extended to other areas. In the commission's view there is a strong case for extending code-making powers to the field of education. In particular, the results of formal investigations by the commission into allocations, suspensions, English as a second language and medical school admission indicate that racial discrimination exists in several areas of educational provision. That has been confirmed by academic research, and the Swann Report drew specific attention to the possibility of unintentional discrimination in educational practices and procedures. Swann also pointed out that it was the commission's unique duty to use its statutory powers to eliminate such discrimination.
From informal consultations with educationists, including chief officers, governors and head teachers, it is clear to the commission that an education code would be welcomed and in fact is regarded as long overdue. In particular, many LEAs and individual schools and colleges are keen to ensure that education is provided without discrimination and they have expressed to us the need for a document that systematically sets out their responsibilities under the Race Relations Act.
One of the consequences of the Education Reform Bill will be that grant-maintained schools, polytechnics and colleges of education will no longer be bound by the duties laid on LEAs by Section 71 of the Race Relations Act, and the same will be true of city technology colleges. The governing bodies of all those institutions will have new and increased responsibilities for aspects of provision—admissions, suspensions, appointments and special needs—where discrimination may occur. An authoritative statutory code will assist them in discharging those responsibilities without discrimination. The commission regards the extension of code-making powers to education as a way of helping those responsible for education to ensure that provision is within the law.
When code-making powers were debated as new Clause 21 in Standing Committee J on 8th March, the Secretary of State indicated that he had doubts about the need for a statutory code though he might be persuaded if it was confined to eliminating discrimination. Such a code, not touching on controversial issues, might therefore be acceptable to him. The commission would be pleased to have an amendment to this effect and presumably would be prepared to propose a code unless the Government

571
would take on the job themselves. As a precedent, the Government have already agreed to an amendment to the Housing Bill to grant the commission code-making powers in the field of housing. So I hope that the Government will look kindly on this amendment. I beg to move.
Baroness Hooper: The Government are sympathetic to the idea of a code, but we believe that it should be non-statutory. This is a sensitive area and the issues raised are best dealt with in non-statutory guidelines. The Commission for Racial Equality already has power, which it has not used, to issue a non-statutory code, and the Government would encourage it now to do so.
The department would be happy to have discussions and to offer guidance to the commission on the contents of a statutory code and it would provide useful advice on what practices could constitute discrimination. We should expect it to carry considerable weight with local education authorities and schools. In the Government's view, it would be preferable to proceed in this way before seeking to legislate.
We would then have an opportunity to assess the need and appropriateness of the statutory code. I can, however, assure the noble Baroness that the government will consider carefully the arguments in favour of the statutory code which have been advanced by her. Meanwhile, I hope that in the light of my remarks she will feel able to withdraw her amendment.
Baroness David: I thank the Minister for that quite positive response, even if it does not go the whole way. In the light of that response and that certain commitment, I beg leave to withdraw the
amendment.
Amendment, by leave, withdrawn.
Clause 189 [Application to Wales]:
[Amendment No. 281 not moved.]
Clauses 189 and 190 agreed to.
Schedule 8 agreed to.
Clause 191 agreed to.
Clause 192 [Orders and regulations]:
[Amendment No. 281ZZA not moved.]
Baroness Hooper Baroness Hooper moved Amendment No. 281A:
Page 169, line 44, after ("137") insert ("paragraph 1A of Schedule 3,").
On Question, amendment agreed to.
[Amendment No. 281AA not moved.]
The Earl of Arran The Earl of Arran moved Amendment No. 281AB:
Page 170, line 5, after ("Act") insert ("which amends or repeals any provision of an Act").
The noble Earl said: This amendment would provide that only Acts should be subject to the negative procedure. This is more consistent with existing practice as amendments to charters can be made without any parliamentary procedure. I beg to move.
On Question, amendment agreed to.
Baroness Hooper Baroness Hooper moved Amendment No. 281ZA:
Page 170, line 8 after ("42(7)") insert ("(Unrecognised degrees), (Identification of bodies granting or providing courses for recognised awards)").
On Question, amendment agreed to.
Amendments Nos. 281ZB and 281ZC not moved.]
Clause 192, as amended, agreed to.
Amendments Nos. 281B and 281C not moved.]
Clauses 193 to 195 agreed to.
Clause 196 [Commencement]:
Baroness Hooper Baroness Hooper moved Amendments Nos. 281CA to 281D:
Page 172, line 29, at end insert ("section (Extension of powers as to trusts for religious education);").
Page 172, line 29, at end insert ("section (Schemes under the Endowed Schools Acts);").
Page 172, line 36, at end insert ("section (Unrecognised degrees: Northern Ireland and Channel Islands);").
Page 173, line 1, leave out ("paragraphs 51 and") insert ("paragraph").
On Question, amendments agreed to.
Clause 196, as amended, agreed to.
Clause 197 agreed to.
Schedule 10 [Minor and consequential amendments]:
Baroness Hooper Baroness Hooper moved Amendments Nos. 281DA, 281DB and 281E:
Page 201, line 33, at end insert—
("The Education (Miscellaneous Provisions) Act 1953 (c. 33)
8A. In Section 2(b) of the Education (Miscellaneous Provisions) Act 1953 (power to require local education authority to defray expenses of establishing controlled school limited to cases where accommodation would otherwise have been provided in some other voluntary school), for the words "voluntary school" there shall be substituted the words "school which is or was either—

(i) a voluntary school; or

(ii) a grant-maintained school which was or had been a voluntary school immediately before it became a grant-maintained school".").

Page 201, line 38, leave out paragraph 10 and insert—
("10. A grant-maintained school shall be an exempt charity for the purposes of the Charities Act 1960, and paragraph (e) of Schedule 2 to that Act (institutions connected with institutions which are exempt charities for the purposes of that Act by virtue of the preceding provisions of that Schedule) shall apply in relation to an institution administered by or on behalf of a grant-maintained school as it applies in relation to an institution included in that Schedule above that paragraph.").
Page 202, line 3, at end insert—
("The Tribunals and Inquiries Act 1971 (c. 62)
11A. In paragraph 6 of Schedule Ito the Tribunals and Inquiries Act 1971 (tribunals under direct supervision of the Council on Tribunals), after paragraph (b) there shall be inserted the following paragraph—
"(c) appeal committees constituted for the purposes of section 48(5)(d) of the Education Reform Act 1988.").
On Question, amendments agreed to.
[Amendments Nos. 282 to 284 not moved.]
Baroness Hooper Baroness Hooper moved Amendments Nos. 284A, 284AA, 284AB and 284B:
Page 206, line 27, leave out paragraph 51.
Page 207, line 16, leave out paragraph 57 and insert—
("57.—(1) Subject to sub-paragraph (2) below, a higher education corporation and any successor company to a higher education corporation (within the meaning of section 113(5) of this Act) shall be an exempt charity for the purposes of the Charities Act 1960.
(2) Sub-paragraph (1) above shall only apply in relation to any such successor company at a time when any institution conducted by the company is for the time being designated under section 113 of this Act.
(3) Paragraph (e) of Schedule 2 to that Act (institutions connected with institutions which are exempt charities for the purposes of that Act by virtue of the preceding provisions of that Schedule) shall apply in relation to an institution administered by or on behalf of—

(a) a higher education corporation; or

(b) any such successor company which is for the time being an exempt charity for the purposes of that Act by virtue of sub-paragrapgh (1) above;

as it applies in relation to an institution included in that Schedule above that paragraph.").
Page 212, line 46, leave out from ("is") to end of line 47 and insert ("administered by an education authority").
Page 215, line 45, at end insert—
("94. The following paragraph shall he substituted for paragraph 16 of Part III of Schedule 2 to that Act—
"16.—(1) Pending the coming into force of the articles of government for a new school which will be a county or controlled school—

(a) the dates at which the school terms and holidays are to begin and end shall be determined by the local education authority; and

(b) the times at which the school session or, if there is more than one, each school session is to begin and end on any day shall be determined by the temporary governing body after consultation with the authority.

(2) Pending the coming into force of the articles of government for a new school which will be an aided school—

(a) the dates and times at which the school terms and holidays are to begin and end; and

(b) the times at which the school session or, if there is more than one, each school session is to begin and end on any day;

shall he determined by the temporary governing body." ").

On Question, amendments agreed to.
Schedule 10, as amended, agreed to.
Schedule 11 [Repeals]:
Baroness Blatch Baroness Blatch moved Amendment No. 285:
Page 219, line 19, column 3, at end insert—

("Section 29(2) to (4).").

The noble Baroness said: This is a consequential amendment. On behalf of the right reverend Prelate the Bishop of London, I beg to move.
On Question, amendment agreed to.
Baroness Hooper Baroness Hooper moved Amendments Nos. 285A and 285B:

Page 220, line 27, at end insert—

("1967 c. 3.

The Education Act 1967.

Section 3.").

Page 221, line 1, column 3, at end insert—

("In Schedule 3, paragraph 14.").

On Question, amendments agreed to.
Schedule 11, as amended, agreed to.
Clause 198 [Citation, extent, etc.]:
[Amendment No. 286 not moved.]
Baroness Hooper Baroness Hooper moved Amendment No. 286A:
Page 174, line 3, after ("178") insert ("(Unrecognised degrees), (Unrecognised degrees: enforcement), (Identification of bodies granting or providing courses for recognised awards)").
On Question, amendment agreed to.
[Amendment No. 287 not moved.]
Baroness Hooper Baroness Hooper moved Amendment No. 288:
Page 174, line 5, leave out ("extends") and insert ("and section (Unrecognised degrees: Northern Ireland and Channel Islands) (1) extend").
On Question, amendment agreed to.
Clause 198, as amended, agreed to.
House resumed: Bill reported with amendments.
House adjourned at nineteen minutes before one o'clock.

  POLICE AND CRIMINAL PROCEDURE: FAILURE TO MAKE PRIOR DISCLOSURE
  POLICE AND CRIMINAL PROCEDURE: FAILURE TO MAKE PRIOR DISCLOSURE
  BUILDING SOCIETIES: EXTENSION OF POWERS
  BUILDING SOCIETIES: EXTENSION OF POWERS