Sitting of 21 March 1990

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
PRAYERS
  PRIVATE BUSINESS
    BIRMINGHAM CITY COUNCIL BILL [Lords]
    Considered; to be read the Third time.
Oral Answers to Questions
  ENVIRONMENT

    Contaminated Land
    Mr. Stern: To ask the Secretary of State for the Environment if he has any plans to compel local authorities to compile a register of contaminated land.
    The Minister for the Environment and Countryside (Mr. David Trippier): I expect shortly to receive a departmental working party report on the feasibility of establishing registers of contaminated land. My assessment of that report will include consideration of whether such registers should be voluntary or compulsory.
    Mr. Stern: Will my hon. Friend join me in welcoming the recent report on contaminated land from the Select Committee on the Environment? It has strong application in my constituency, because it calls for a compulsory register of potentially contaminated land, such as at Avonmouth in my constituency. Does my hon. Friend agree that a register will create an opportunity to evaluate such land, and in so doing remove a barrier to its development, which potentially is one of the golden opportunities in Bristol?
    Mr. Trippier: I welcome the Select Committee's report, to which my right hon. Friend the Secretary of State hopes to respond shortly. We are anxious to be as positive as possible in our response. In my evidence to the Select Committee, I said that it is essential that all contaminated land should be easily identified. A local register held at district council level would be very helpful.
    Dr. Kim Howells: The Minister will be aware that there is a register of contaminated land in Wales, but the problem is that local authorities do not have the money to do anything with the information that they have collected. Much money will be needed just for methane drainage schemes and for the removal of contaminated top soil. Will the Government offer local authorities grants to enable them to do that work?
    Mr. Trippier: One of the most successful grant mechanisms in Wales, as in England, is the derelict land grant. For every £1 of taxpayers' money that we have
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    spent, about seven times as much has been attracted from the private sector. There is an increase in the public expenditure survey line of the Department of the Environment, but I should have to find out what has happened with the Welsh Office. I commend that scheme to the hon. Gentleman.
    Mr. Butler: My hon. Friend may be aware that Arpley Meadows, a landfill site in my constituency, takes low-level radioactive waste. Does he believe that such sites should be compulsorily registered?
    Mr. Trippier: Such sites certainly should be registered, and that will be part of our response to the Environment Select Committee's report. I can give my hon. Friend the comfort that we have raised the standards to deal with such waste in the Environmental Protection Bill.
    Ms. Walley: Does the Minister agree that it would have been far better if the full reports of the departmental working party had been given during the Committee stage of the Environmental Protection Bill? Does he further agree that that would have enabled us firmly to enshrine in legislation a measure similar to the register in Wales? On Report, once the Minister has consulted local authority associations, does he intend to provide a clear duty for local authorities to compile a register? Will he give them the resources, take account of the problems associated with blight and ensure that the money to render contaminated sites harmless is incorporated in the Bill on Report?
    Mr. Trippier: The principal reason why we could riot bring those measures before the Committee considering the Environmental Protection Bill was covered by the hon. Lady in her question. It would be less than courteous if we did not consult local authority associations, which believe—I think that the hon. Lady agrees—that registers should be made compulsory. It would be foolish, and certainly discourteous, if I were to make an announcement from the Dispatch Box without properly responding to the Select Committee's report. I certainly should not rule out the possibility of legislation.

    Council Rents
    Ms. Armstrong: To ask the Secretary of State for the Environment what proposals he has developed to keep council rents at an affordable level.
    The Minister for Housing and Planning (Mr. Michael Spicer): It is for local authorities to determine the rents that they set. The Government are providing £3 billion of taxpayers' money to subsidise housing revenue accounts, from which around 60 per cent. of council tenants receive rent rebates, and rents generally can be kept within the reach of lower-paid tenants.
    Ms. Armstrong: Does the Minister recognise the reality of council house rent rises this year? As with the poll tax, the Government have totally miscalculated the range of rent rises. For groups whose income is just above rebate levels, the penalty of the rent rises and the poll tax is totally beyond their means.
    Mr. Spicer: We have not totally miscalculated the rent rises. Most authorities have kept within or below our guidelines. We estimate that the average difference

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    between our guidelines and actual rent increases is about 3 per cent. Council house rents throughout the country remain well below market rents.
    Mr. McCrindle: Does it remain Government policy to seek a relationship between council house rents and the average value of property in the vicinity? If so, does my hon. Friend believe that, in some ways, that might be getting things the wrong way round? Sometimes the most acute housing difficulties are experienced by people living in areas where the average value of property is high.
    Mr. Spicer: We certainly want the pattern of rents to reflect the pattern of property values and market rents more than it does now. Vast amounts of public money go into subsidising rents throughout the country.
    Mr. Beggs: Does the Minister agree that it is inevitable that housing rents will continue to rise? Does he further agree that more tenants should consider purchasing their own property?
    Mr. Spicer: The hon. Gentleman makes a good point. One million households have done precisely that under the right-to-buy scheme. I certainly want as many tenants to buy their properties as feel able to do so, for all the reasons implicit in the hon. Gentleman's questions.
    Mr. Robert G. Hughes: Does my hon. Friend agree that the level of rents is an important factor in the amount of money that an authority will have available to carry out repairs, so it is not surprising that many Labour local authorities that have deliberately kept rents low for political reasons have had little to spend on repairs?
    Mr. Spicer: My hon. Friend is absolutely right. Authorities can keep to our guidelines, knowing that the costs of borrowing and of rent rebates have been taken fully into account and that an allowance has been made for an 8 per cent. increase in maintenance programmes. Authorities that have not carried out maintenance programmes will certainly not have done their tenants a good service.
    Mr. Soley: The guidelines are pure fantasy, and the Minister knows it. The authorities that cannot meet them are primarily Conservative councils. What specifically will the Minister say to the London boroughs of Redbridge and Merton, to Bournemouth and to Canterbury, all of which are Conservative councils and all of which are imposing top rate rent increases? There will be an average rent increase of more than £15 a week in Redbridge. A bill for a £15 a week increase will arrive on the doormat at the same time as the poll tax bill. How is a family of four supposed to live? Are they living on fresh air or on a feast of Tory broken promises?
    Mr. Spicer: I repeat that the guidelines are not figments of our imagination. They take full account of the borrowing costs of local authorities, of rent rebates and also of an 8 per cent. increase in maintenance costs. If an authority decides to go above our guidelines, it is perfectly free to do so. An authority may decide to do so for the best of reasons—to accelerate a maintenance programme or add to balances. That is a matter for the local authorities, and that is called local democracy.
    Mr. David Nicholson: I am sure that my hon. Friend will agree that those living in good quality council houses—not flats—with gardens should pay a slightly more
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    realistic rent, especially as, after yesterday's Budget, housing benefit will be more extensively available. Does my hon. Friend accept the point made earlier—that it is important that local authorities should be able to use the extra revenue to meet the pronounced need of those in my constituency and elsewhere who cannot yet obtain council housing?
    Mr. Spicer: My hon. Friend makes an important point. Benefits are available for, on average, 60 per cent. of council tenants and some of them are among the most generous in the western world. They go up to 100 per cent., so my hon. Friend is absolutely right.
    If some local authorities decide to spend more on maintenance programmes in their area, that is a matter for them. The fact remains that, contrary to what the Opposition say, average rents throughout the country are well below market rents.

    Urban Development Corporations
    Mr. Fatchett: To ask the Secretary of State for the Environment what is the total amount of money spent by the Government through urban development corporations since 1981–82; how many houses for rent have been provided by each of the urban development councils during that period; and if he will make a statement.
    The Minister for Local Government and Inner Cities (Mr. David Hunt): Urban development corporations have proved to be an excellent investment of taxpayers' money: £820 million has secured £7 billion worth of private sector investment, the creation of 26,000 new jobs and the reclamation of 2,700 acres of derelict land. Up to last year more than 2,000 homes for rent had been completed in UDC areas and several further schemes are under way or proposed.
    Mr. Fatchett: May I congratulate the Minister on his forthcoming appointment and ask him whether he will deny that it is simply a manoeuvre to avoid having to deal with the chairman of Leeds urban development corporation, who is clearly an embarrassment to Leeds UDC and the Government? It is clear that development in UDC areas often involves an emphasis on big and grandiose schemes at the cost of small and local business, and there is plenty of evidence that that is already happening in Leeds. Does the Minister agree that the UDC should have a priority to provide for local business and also to provide for local people to live in the inner-city areas, in housing that they can afford—either by low-cost purchase or by rental? Are not the schemes envisaged by the UDCs pushing such people out and depriving them of housing opportunities in inner-city areas?
    Mr. Hunt: UDCs have a statutory remit to encourage people to live and work in their areas. Some 2,500 homes for rent are being built or are proposed in UDC areas in England and Wales at present. Instead of criticising his local development corporation and its chairman, the hon. Gentleman should concentrate—as many Opposition Members and many of my hon. Friends do—on supporting development corporations and their chairmen in the excellent work that they do.
    Mr. Batiste: I hope that my hon. Friend will disregard the continual and irresponsible attacks that the hon. Member for Leeds, Central (Mr. Fatchett) makes on Leeds

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    urban development corporation. Does my hon. Friend recognise that one of the difficulties in the rented accommodation sector in Leeds—especially in constituencies such as mine, comprised of towns and villages on the periphery of the city—is that the council will not afford any priority to housing local people in areas where they have been brought up? If it did so, more housing would be available in rural communities around Leeds.
    Mr. Hunt: I could not agree more with my hon. Friend. We must ensure that, in our inner-city policy, we concentrate on giving people greater opportunities for jobs, better community facilities, a better environment in which to work and live and better homes. That is what the development corporations are doing and I only wish that they received more co-operation and help from local authorities.
    Mr. Loyden: In spite of what the Minister has said, he must be aware that in the main the responsibility still lies with local authorities that have to meet the needs of the people who are compelled to seek housing for rent. Is he aware that because of the Government's policies, the urban renewal programme in Liverpool is in danger of not being completed? I am sure that he is aware that that city has had tremendous housing problems throughout the post-war period. Does he accept that the Government must do something to allow local authorities to continue their building programmes?
    Mr. Hunt: I hope that the hon. Gentleman will find time in his busy day today to attend the conference at the Barbican, which is being organised by Business Opportunities on Merseyside and which will be addressed this afternoon by both myself and the leader of Liverpool city council. If the hon. Gentleman were to do so, he would hear a much more positive message than the one that he it trying to put across. There is a positive partnership in Liverpool to improve the quality of life for the people there. The hon. Gentleman should praise and recognise that instead of belittling it.

    Vacant Land
    Mr. Bevan: To ask the Secretary of State for the Environment how many acres of vacant, dormant, underutilised and derelict land is currently in Government ownership; how much has been disposed of since the land register was set up; and when he estimates the remaining areas will disposed of.
    Mr. Michael Spicer: By 30 September 1989 some 5,600 acres had been disposed of and 1,400 brought into use. At that date, some 7,200 acres were on the register. Their future will depend on a variety of circumstances related to individual sites, including marketability.
    Mr. Bevan: If, like me, my hon. Friend is dissatisfied with the speed of disposal of land on the register, and if he believes that the lack of purchasers shows a lack of interest in such property, will he take measures at once to speed disposals and to transfer suitably located parcels of land at low, nil or negative values to housing associations or to building societies, to create stocks of low-value, low-rent homes for those in housing need, and to encourage a property-occupying and saving society?
    Mr. Spicer: I very much agree with my hon. Friend that we should make use of derelict land for purposes other than keeping it derelict. I also agree that much more can be done to make such land more marketable. We are giving the matter urgent attention at the moment and I listened carefully to what my hon. Friend said.
    Mr. Hardy: Is the Minister aware that in my constituency and in surrounding constituencies, many people would agree that they do not wish to see the land remain derelict? However, is he also aware that in the past few years hundreds of acres of land have become derelict in that area and that until the Government bring forward an intelligent and far-sighted view of derelict land grants, there is no prospect of the desperately needed improvements being made in that area?
    Mr. Spicer: The Government have greatly increased derelict land grants, which now amount to £71 million per year. We have nothing to be ashamed of in that. In fact, the grants have been put to extremely good use. The question is whether anything can be done over and above simply throwing money at the problem. We must consider other ways of trying to make such land marketable.
    Mr. Steen: Is the Minister aware that there are now about 500,000 acres of vacant, dormant, derelict and underutilised land in both public and private ownership and that 60,000 acres of public vacant land have been added to the register since 1981? Does he agree that a private initiative is now required to market that land and to ensure that the people who hold the land at the moment—the public authorities—have a share in the asset value as it increases?
    Mr. Spicer: I am very much aware of the fact that my hon. Friend the Member for South Hams (Mr. Steen) has taken a great interest in this matter for many years and has written a learned treatise on it. I am studying his writings., which relate to his question, very carefully.
    Mr. O'Brien: Is not it clear that the hon. Member for Birmingham, Yardley (Mr. Bevan) was requesting the Minister to give the Government's policies on derelict land, particularly land in Government ownership, but that those policies were not forthcoming? Is not it also clear that the £71 million derelict land grant is insufficient to meet the needs expressed by hon. Members on both sides of the House? When will the Minister allow a debate in the House on derelict land? Let us have some policy directives so that people in local government and outside it who must deal with derelict land know exactly what will happen.
    Mr. Spicer: Personally, I should be more than happy for there to be a debate on derelict land, but that is not in my gift. I am sure that those responsible for such matters will listen to the hon. Gentleman. The question is whether it is just a matter of throwing more money at the problem, in addition to the £71 million available. If the land can be made marketable, such additional expenditure would be a waste of public money. We are carefully considering whether we can do more to make such land marketable, to enable it to pass into the hands of those who would turn it into something that would not necessarily require public moneys. We are considering the matter urgently and I should welcome a debate on it.

    Local Government Finance
    Mr. Madel: To ask the Secretary of State for the Environment whether he is yet able to say whether he will community charge-cap Bedfordshire county council for the financial year 1990–91; and if he will make a statement.
    Mr. David Hunt: We are now looking at the budget information that we have received from local authorities. Until we have reached our decisions, I hope that my hon. Friend will understand that I cannot speculate whether Bedfordshire county council or any other local authority would be capped in 1990–91.
    Mr. Madel: I also congratulate my hon. Friend on his forthcoming elevation. Before he crosses the River Dee to take up his Welsh duties, may I draw his attention to the fact that the Audit Commission has strongly criticised the Labour-Liberal Bedfordshire county council for overspending? Despite that, the county council is increasing spending next year by 14 per cent. which will cause an unacceptably high community charge. As the community charge is designed to increase accountability, will my hon. Friend consider changing the electoral system whereby one third of county councillors would come up for election every year? That would not only make the county council more accountable, but would give us in Bedfordshire the chance to remove Labour and Liberal county councillors who have caused this huge community charge.
    Mr. Hunt: First, I thank my hon. Friend for this kind remarks.
    Bedfordshire has done very well from the settlement, and the external support for Bedfordshire authorities, taken together, is 15·8 per cent. higher than in 1989–90. Yet, as my hon. Friend rightly points out, the county council seems to have decided to increase its income by approximately twice the rate of inflation. That is a serious matter and it is worth reflecting that, perhaps the county council would not be doing that if it has to face its electorate this year.
    Mr. Gould: I add my congratulations to the Minister on his promotion. How long does he estimate that it will take charge-capped authorities to prepare and issue revised bills? What calculation has he made of how much that will add to the already excessive cost of collecting the poll tax? What help does he propose to offer in respect of the cash flow problems that such authorities will undoubtedly face? Does he have any concept of the impossible burden that he is imposing on local authority treasurers, Tory as well as Labour, who are already hard-pressed, through his refusal to specify what his charge-cap criteria will be?
    Mr. Hunt: I thank the hon. Gentleman for his kind remarks and look forward to explaining in Wales, as I have in England and still will for a further two months, the way in which the community charge is a much fairer and simpler system, which makes local authorities more accountable.
    Capping was a matter for Parliament to decide and it decided to give the power to charge-cap to the Secretary of State. Once we have considered all the budget information available we shall take our decisions and announce them to the House. Until then it would be wrong to speculate about the timing or operation of any capping scheme that
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    we might operate. We have made it clear, however, that we shall cap authorities that have chosen to budget excessively.
    Mr. Bright: Does my hon. Friend agree that it is complete nonsense for people in Bedfordshire to compare this year's community charge with last year's rates? Under the spendthrift Labour-Liberal authority that we have in Bedfordshire—[HON. MEMBERS: "Hear, Hear!"]—those people would have felt a considerable impact if the rating system had remained. That factor should be considered; at present, we are not comparing like with like.
    Mr. Hunt: I agree with my hon. Friend, and the response from the House demonstrates how true his words are. Had the rates system continued, for Bedfordshire authority to have raised the same amount of income from its local people, there would have had to have been a substantial increase in domestic rates. If Bedfordshire council was run by the efficient Conservative administration in Luton, the community charge would be much lower.
    Mr. Clay: To ask the Secretary of State for the Environment what is the average poll tax for England in 1990–91.
    The Secretary of State for the Environment (Mr. Chris Patten): On the information available to me, I estimate that the average community charge in England is £363.
    Mr. Clay: Will the Secretary of State admit that his estimates of the poll tax were probably made up on the spare page of a fairytale book? Does he accept that councils of all political persuasions have been forced to fix the poll tax on average 30 per cent. above his phoney guesstimates? As he and the Government cynically misled the British people about the levels of poll tax, what right has he or any of his colleagues to deliver sanctimonious lectures to the millions of people in this country who are determined to resist this evil tax?
    Mr. Patten: The principal reason for the level of community charge in the coming year is that local authorities' gross revenue expenditure will be £5 billion higher next year than this year. On those figures, domestic rates would have increased by about 33 per cent. The only lecture that I will give is that people should obey the law and pursue democratic argument through the ballot box. I hope that that is the lecture that Opposition spokesmen will give to the hon. Gentleman who, as I understand it, advocates that his constituents and other people should not pay the community charge.
    Mr. Squire: Will my hon. Friend confirm that his Department is producing a schedule setting out what the charge would have been for each local authority had the rating system remained? Will he further confirm that that schedule will distinguish between authorities that suffered a substantial reduction in real terms in Government support and those that shamelessly increased their expenditure, to stratospheric levels in some places?
    Mr. Patten: We shall certainly attempt to give the sort of information for which my hon. Friend has asked. In due course the House will wish to know what the consequences for domestic rates would have been in individual authorities given some of the spending levels that have been set. The community charge—or domestic rates if we

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    still had them—will be higher in areas controlled by Labour councils. For example, the average charges in Labour-controlled London boroughs are £167 higher than in Conservative boroughs.
    Mr. McKelvey: Will the Secretary of State compare the average charges in England with those of the Labour authorities that control most of Scotland? Will he give the amounts that might be reclaimed in rebates and state whether they take into consideration the changes made by the Chancellor of the Exchequer yesterday? Does the Secretary of State believe, as I and most other Scots do, that the changes should apply retrospectively to Scotland? Does he further understand——
    Mr. Speaker: Order. One question please.
    Mr. McKelvey: —that despite the transitional payments, which are part of the poll tax and were announced at the Conservative party conference, not one person in Scotland has benefited from the supposed changes?
    Mr. Patten: The responsibilities of my Department are extensive, but do not go as far as the bounds of the hon. Gentleman's question. He will have noticed that the research on Scotland shows that people in low-income households pay a smaller proportion of their income on the community charge than they paid on domestic rates. I take it that part of the hon. Member's question was addresed to the generosity of the local authority grant settlement in Scotland.
    Mr. Tracey: My right hon. Friend will join me in congratulating the Chancellor on his welcome announcement on community charge relief. Will he assure the House and our constituents that the new reliefs will be paid before the bills have to be met this year, following the changes made by the Chancellor?
    Mr. Patten: All local authorities will want to do everything that they can to ensure that people get the relief they deserve as rapidly as possible.
    The Department of Social Security will be talking to local authorities to ensure that relief is paid as expeditiously as possible. As my hon. Friend said, yesterday's statement by my right hon. Friend the Chancellor was widely welcomed and shows that we have listened to some of the constructive criticisms.
    Mr. Pike: For once, will the Secretary of State stop knocking local authorities for overspending and recognise that local authorities such as Lancashire and many others are trying to meet the needs of the people who elected them? If poll tax-capping is introduced, will he accept responsibility for the services that are cut and at some stage will he say what he will do to help people who cannot pay the poll tax?
    Mr. Patten: What is of most concern is not whether I am knocking local authorities but whether local authorities are knocking community charge payers—and all too many of them are. I am extremely pleased that the community charge benefits are more generous than those available under domestic rates.
    Mr. Mans: Does my right hon. Friend agree that the wide range of community charge levels reflects the wide range of council manning levels and shows that some at least are overmanned and inefficient—Lancashire, for one?
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    Will he take an early opportunity to publish a list of manning levels of local authorities so that community charge payers can see whether they are getting value for money?
    Mr. Patten: An inevitable and welcome consequence of the introduction of the community charge is that more local voters are becoming interested in value for money in local government. The sort of figures for which my hon. Friend has called will be of considerable interest to many local charge payers.
    Mr. Blunkett: Does the Secretary of State accept that although Opposition Members warmly welcome the statement of the Chancellor yesterday, we are very concerned that the Treasury and the Department of the Environment seem not to understand that, while lifting the capital disregard for entitlement to rebate on poll tax and to housing benefit, they have failed to alter the taper? In consequence, people who have capital investments or savings of over £10,000 a year, despite the lifting of the ceiling to £16,000, will not be entitled under present rules to either housing benefit or poll tax rebate. Will he state this afternoon that the Government are prepared to change the rules, which involve £1 of income being counted for every £250 of capital savings held over £3,000, so that people are entitled to benefit? Does he accept that, in making a complete mess of this—as they have of everything else—the Government have misled people into believing themselves entitled to help that they will not get?
    Mr. Patten: The hon. Gentleman is not well informed on that question. I hope that he will recognise that the taper is already more generous than it was previously. That is why many more people will benefit under the new system than did under the previous system.

    Architects
    Mr. Summerson: T: To ask the Secretary of State for the Environment how many architects are employed by his Department; and at what cost.
    The Parliamentary Under-Secretary of State for the Environment (Mr. Christopher Chope): Thirty-six architects are employed by my central Department and 375 in the Property Services Agency at salary costs of £1 million and £9·2 million respectively.
    Mr. Summerson: Is my hon. Friend satisfied with the work of those architects in designing buildings to be erected on vacant and derelict publicly owned land? Would not it be better to dispose of the land and to let private sector architects get on with the job?
    Mr. Chope: I agree with my hon. Friend that architects have an important role in bringing derelict land back into use and that it is desirable to have as many architects as possible in the private sector. That is why I am delighted that of the 375 employed in the PSA, 372 will go with PSA Services into the private sector in 1992.
    Mr. Eastham: Is the Minister satisfied with the quality and standards of architecture and is there enough flair in the business of architectural design? If not, could that be because of the straitjacket of Government cost yardsticks?
    Mr. Chope: We have a reasonably high standard of architecture, and in recent years many architects employed

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    in the PSA have won design awards. We get about 23 design awards in the PSA every year. I should be happy to put in the Library a list of awards won during the past 12 months.
    Mr. Barry Field: When considering specialist staffing in his Department, can my hon. Friend tell the House what justification there is for the royal parks police who regularly turn up in their specialised police vehicles, two or three——
    Mr. Speaker: Order. Are they also architects?
    Mr. Chope: I am not aware that the royal parks police employ any architects.

    Walkers
    Mr. Andrew F. Bennett: To ask the Secretary of State for the Environment what discussions he has had about improving access for walkers and climbers to mountain and moorland in England and Wales.
    The Parliamentary Under-Secretary of State for the Environment (Mr. David Heathcoat-Amory): We have had useful discussions about such matters with a wide range of organisations. In particular, we have discussed with the Countryside Commission its policy for improving access to the countryside. Subject to parliamentary approval, its grant in aid will increase next year by 13 per cent. Part of that is in support of its work on access and rights of way.
    Mr. Bennett: I thank the Minister for his reply. May I remind him that about 10 million people enjoy walking in the countryside as a recreation and that the number is steadily increasing? What steps will the Government take over the next 12 months to ensure greater access?
    Mr. Heathcoat-Amory: We have a superb network of rights of way—about 140,000 miles in all. It is primarily the duty of the highways authorities to keep them clear of obstructions and to record them on maps which are made available to the public. Those highways authorities can also negotiate additional rights of way where appropriate.
    Sir Michael Shaw: Is my hon. Friend aware that proper access must never be confused with indiscriminate access to moorland? Are not control of the moorlands and their proper management absolutely necessary for the continuance of a fine tradition in our countryside?
    Mr. Heathcoat-Amory: I agree with my hon. Friend. Our aim is to give maximum access to the public, consistent with proper management of the land and the needs of nature conservation. The rights of way network is often the best way of giving that access while avoiding confrontation and conflict with those who work in the countryside.

    Environmental Labelling
    Ms. Quin: To ask the Secretary of State for the Environment if he will make a statement on the negotiations within the European Community to set up an environment friendly labelling system.
    Mr. Chris Patten: Following agreement at the Environment Council meeting last September, official level discussions with the European Commission will take place
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    later this month to develop proposals for a Community wide scheme of positive environmental labelling for consumer products.
    Ms. Quin: As progress on this matter in the European Community may turn out to be slow, will the Secretary of State commit himself to introducing such a scheme in this country if there has not been agreement by the EC within a specific time limit, for example the end of this year?
    Mr. Patten: As the hon. Lady will know, we have taken the lead on this initiative in the European Community. The Commission has assured us that it will be possible to introduce proposals reasonably soon. I should like to see them in place, or at least agreed, by the end of this year. If we do not make the progress that we should like, we shall have to go ahead with a national scheme. The objective is to have in place national schemes which are compatible across the Community so that we are prepared for the single market in 1992.

    World Cup (Security)
    Mr. Pendry: To ask the Secretary of State for the Environment what steps his Department will take to ensure that security arrangements for British soccer fans at the World Cup are adequate and comprehensive.
    The Parliamentary Under-Secretary of State for the Environment (Mr. Colin Moynihan): We are providing assistance to the Italian authorities in respect of safety and security measures in connection with England's participation in the World Cup. My Department chairs an interdepartmental working party of officials, which also includes representatives from the police and the football authorities, to co-ordinate United Kingdom measures on preparation for the tournament.
    Mr. Pendry: That is all very well, but will the Minister confirm that there will be exchanges between the Italian and English police authorities, that the intelligence that has been gathered by police spotters will be used in any operations, and that he will take action on alcohol restrictions of the kind that were so successful during the England-Holland match in Dusseldorf? Finally, does he believe——
    Mr. Speaker: No. One question please, although I think that the hon. Gentleman has had two.
    Mr. Moynihan: In fact, Mr. Speaker, I think the hon. Gentleman asked three questions, all of them important. Police spotters and closed-circuit television have proved invaluable in our determined efforts to reduce football hooliganism at domestic games, at the European championships and at international friendlies. The information gathered by, and expertise of, the spotters and the national football intelligence unit will be on offer to the Italian authorities. The hon. Gentleman will appreciate that I cannot comment on the detail of police operations.
    The hon. Gentleman's supplementary question related to the exchange of police. That is already under way. As he will be aware, about 50 carabinieri are at present in England—[Interruption.]—not, as some newspapers suggest, learning English as understood by football supporters. Their visit is devoted primarily to the policing of football.

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    To answer the hon. Gentleman's third supplementary question, on the vital issue of alcohol restrictions, I assure him that I shall be discussing that matter in detail during my forthcoming visit to Sardinia.
    Mr. Jack: Is my hon. Friend aware that many England soccer fans in Lancashire may be unable to travel to see the World Cup as a result of the excessive community charge demands of Lancashire county council? They could have travelled had the Conservative proposals—for a community charge of £60 per head less—been adopted.
    Mr. Moynihan: I am only too well aware of the position expressed by my hon. Friend.
    Mr. Menzies Campbell: Does the Minister appreciate that security at home is just as important as security abroad? Does he further appreciate how welcome was yesterday's announcement by the Chancellor of the Exchequer? Is he aware that many other sports—rugby league and rugby football, for example—will be affected by the Taylor committee recommendations and will he undertake to discuss with his right hon. Friend ways in which those sports may be assisted to make the changes which the Taylor recommendations necessarily involve?
    Mr. Moynihan: The whole House will wish to join me in welcoming that announcement, which reflects the Government's concern to ensure that vital improvements to football grounds are made. I am certain that the football authorities will now take urgent steps to provide for the safety and comfort of their spectators by implementing as quickly as possible Lord Justice Taylor's recommendations. All-seater stadia are, as the Football Association and the main question recognise, a prerequisite to a successful and safe World Cup bid.
    Mr. Batiste: Does my right hon. Friend agree that the improved facilities that will be provided in English football grounds as a result of yesterday's announcement by the Chancellor may make it possible for this country to host a future World Cup?
    Mr. Moynihan: I agree with my hon. Friend. Yesterday's announcement will be warmly welcomed as being significant for sport. As the Football Association recognised in representations to the Secretary of State and myself, all-seater stadia are a pre-requisite. They are essential now for any country wishing to host the World Cup, and the twin aims—of ensuring the safety of spectators and of making sure that we have a sufficient number of all-seater stadia to host the World Cup—are doubly welcome.
    Mr. Denis Howell: May I, from the Opposition Benches, endorse our appreciation of the Chancellor's action yesterday which the Minister will recall we advocated in the debate in January, after negotiations with the pools promoters? Will the Minister be more active in relation to the potential explosion of violence in Italy? Will he comment on the reports that the thugs of Holland and of this country are already arranging their own fixtures for a celebratory punch-up? That would be disastrous.
    Is it true that the police have only nine names on their computer to use in relation to part II of the Football Spectators Act 1989? Will we be able to stop only nine of these evil crooks going abroad and causing trouble? What
    1116
    will the Minister do to make sure that the hundreds of people who misbehaved last year are not allowed to leave these shores for the World Cup?
    Mr. Moynihan: We hope that part II of the Football Spectators Act will be in place by the end of April. The right hon. Gentleman is right that it is vital that it should be in place before the World Cup and that everything possible should be done to assist the Italian Government and authorities in minimising trouble during the World Cup and in deterring the hooligan factor. Five major interdepartmental meetings have been held in the past year; I have been to Rome and I shall shortly be going there again and to Sardinia. We shall be offering every possible assistance, through the Home Office, the Foreign Office and my Department. If the right hon. Gentleman has any additional ideas, we shall look at them closely.
    I am grateful to the right hon. Gentleman for his initial comments. That we have taken careful note of the representations that he and the hon. Member for Stalybridge and Hyde (Mr. Pendry) have been making for many years was evidenced by the measures announced by my right hon. Friend the Chancellor of the Exchequer yesterday.

    Local Government Finance
    Mr. Winnick: To ask the Secretary of State for the Environment what are the latest representations he has received over the implementation of the poll tax.
    Mr. David Hunt: My right hon. Friend the Secretary of State and I continue to receive representations on a wide range of issues concerning the community charge.
    Mr. Winnick: Can the Minister give any explanation why, despite the sustained Government propaganda, the poll tax is so widely hated throughout Britain, including Mid-Staffordshire? I know that the Minister is not yet a member of the Cabinet, but why do not the members of the Cabinet stand up to the Prime Minister in the same way as Tory councillors have done by rightly resigning the Tory whip in many parts of the country in opposition to this notorious measure?
    Mr. Hunt: Before the hon. Gentleman gets carried away
    about alleged unfairness, does he think it fair that people living in Conservative wards in the Walsall area, regardless of how they vote and regardless of their circumstances, should have only £298 per head spent on them by the council—the Government's assumed community charge for Walsall—while people in Labour areas have £425 per head spent on them under the Labour council's community charge? That is the policy of the hard Left on the council which the ruling Labour group accepted on 5 March. Its policy is to look after its own areas and blow the rest. That is unfair, it is a scandal and the hon. Gentleman should condemn it.
    Mr. Donald Thompson: Several tens of thousands of people in my constituency will receive rebates and transitional relief. Is my hon. Friend sure that everybody who is entitled to those reliefs will get them?
    Mr. Hunt: We must do everything possible to ensure that they do. Earlier this afternoon the hon. Member for Sheffield, Brightside (Mr. Blunkett) said that people with savings of more than £10,000 would not be entitled to a

    1117
    rebate; that is incorrect. Equally incorrect was his previous statement that people would not be entitled to transitional relief, or would lose their right to transitional relief, where a council was spending higher than the Government's assessment. If we joined in putting across the positive message to 10 million people that they are entitled to rebate, with the additions of yesterday, and to 7·5 million people that they are entitled to transitional relief, we would all be doing much better by the British people.
    Mr. Gould: How many representations has the Minister received from Tory local authorites across England and Wales which have combined to produce poll tax bills an average of 31 per cent. above Government projections? That is within a whisker of the national figure of 35 per cent. Can he guarantee that there will be no further protest resignations by Tory councillors to add to the 18 in West Oxfordshire, and the nine who resigned yesterday in Humberside?
    Mr. Hunt: I have received a number of protests and representations from Tory areas about the extent to which they must pay into the safety net to protect losing areas, which in the main are Labour areas. The hon. Gentleman should look again at the calculations. If he took the safety net contributions out of the comparison, he would find that the average community charge in Labour areas was considerably above that in Conservative areas.
    Mr. Moss: Did my hon. Friend see yesterday's newspaper articles revealing that in Labour-controlled Islington the community charge would be £68 less per head if the council did not dish out money to fringe groups? Does my hon. Friend agree that the best way to get the community charge down is to get rid of Labour councils?
    Mr. Hunt: I could not agree more. I hope that, as the pain of accountability hits Labour councils, they will begin to listen to their ratepayers and their future community charge payers. As for the newspaper article, I look forward to The Sun shining on the truth of Labour irresponsibility in the days to come.

    Housing, Liverpool
    Mr. Wareing: To ask the Secretary of State for the Environment if he will visit Liverpool to study its housing problems with a view to reviewing its housing investment programme.
    Mr. Chope: I have no plans to review Liverpool's main housing investment programme allocation for the coming year which is to be increased by 73·2 per cent. compared with this year.
    Mr. Wareing: If the Minister came to Liverpool he would realise how horribly below the necessary level the Government's housing investment programme is. The people of Liverpool believe that they are being discriminated against on narrow ideological grounds. Liverpool has more than its share of Boswell and Boot defective houses, and that is not the people's or the council's fault. More than 700 people who bought their houses at the Government's behest now cannot sell them. When will the Government do something about that, and live up to what Liverpool people, who bought their houses under the Government's diktat, expect from them?
    Mr. Chope: The Government have been incredibly generous to Liverpool with taxpayers' money. Next year's HIP allocation for Liverpool is the third highest in the country, at more than £33 million. On top of that, next year the housing revenue account subsidy for Liverpool amounts to about £68 million, which is more than £1,000 per dwelling.
    Mr. Hind: If my hon. Friend visits Liverpool, as the hon. Member for Liverpool, West Derby (Mr. Wareing) suggests, perhaps he would travel on to west Lancashire——
    Mr. Speaker: Order. Not today, please.
    Mr. Hind: —where he will note that the misbehaviour of Liverpool city council over the years, in overtaxing its tenants and its industry has resulted in many of its current problems, such as loss of grant. Does my hon. Friend agree that the real truth is that Liverpool city council has landed Liverpool in the mess that it is in today?
    Mr. Chope: I agree with my hon. Friend. In many respects, Liverpool has been the author of its own misfortune. That is especially true with defective housing. Whereas most councils have dealt with 60 to 65 per cent. of their defective houses, Liverpool has got around to dealing with only 5 to 10 per cent. That is why the hon. Member for Liverpool, West Derby (Mr. Wareing) has a problem in his constituency.

    Homelessness
    Miss Hoey: To ask the Secretary of State for the Environment if he has developed any new proposals to alleviate homelessness.
    Mr. Fearn: To ask the Secretary of State for the Environment if he has any plans to bring forward proposals to reduce the number of homeless people in England and Wales.
    Mr. Michael Spicer: I shall very shortly be announcing allocations for 1990–91 of the two-year programme of additional resources to meet the problem of homelessness in London and the south-east. These will total £112 million for local authorities and should result in more than 5,000 additional lettings next year.
    Miss Hoey: I thank the Minister for his reply and urge him to make his announcement very quickly. Is he aware of the special needs resulting from homelessness in the Waterloo area, particularly in the bull ring? Does he know that the money to be made available for the borough of Lambeth will not make it possible to deal with that special problem? Will he recognise that fact by coming up with a new project for the area with which the London borough could help? As he is a new Minister, will he share a walkabout with me some evening in the next fortnight so that he may see the area for himself?
    Mr. Spicer: Much as I would enjoy accompanying the hon. Lady round the bull ring, it would be a little superfluous as I have already been there to look at the problems. I agree with the hon. Lady that people living rough in the area present a special problem. The question, which we are addressing very urgently, is what can be done about it without encouraging people to leave home. People

    1119
    leaving home early and split marriages are major causes of rooflessness. The allocations that I have announced today will, of course, help.
    Mr. Fearn: Does the Minister agree that the extra amounts allocated for hostels and for counselling are far too small?
    Mr. Spicer: There are 50,000 hostel places in this country—21,000 of them in London alone. The question is whether the throughput is fast enough. One reason behind what I said today is that we want to provide more fixed abodes. We want to provide housing to which people currently in hostels may go. That is precisely why we have targeted this extremely generous amount of money as we have.

National Health Service Hospitals (Opting Out)
3.31 pm
Mr. Martin Redmond: I beg to move,
That leave be given to bring in a Bill to provide that a referendum shall be held in a health authority area on any proposal that a hospital in that area should opt out of the National Health Service.
The Government are steering through Parliament a Bill that will bring fundamental change to the National Health Service in Britain—a Bill for which they have no mandate. Not least of the changes is that hospitals—indeed, whole health authorities—will be allowed, even encouraged, to opt out of local NHS control and assume self-governing status. This is an example of the Government's blind commitment to the market and to competition, regardless of how unsuitable or inapplicable the free market in health care may be.
I call on the House to support my proposal for a referendum to be held in all areas where there have been expressions of interest in opting out. If the result should be against opting out, the wishes of the local community and staff should be heeded, and expressions of interest withdrawn.
Hon. and right hon. Members will be aware already of the grave misgivings of the medical profession about the changes and about the consequences that they will have for national health care provision in Britain. These misgivings, among the medical and nursing professions, among Health Service ancillary staff and among patients and the general public have manifested themselves as outright opposition to the Government's proposals for opting out.
Opposition has been expressed by members of local health authorities. Indeed, in my part of the world—Don Valley—health authority members have voted against expressions in favour of opting out from managers at Doncaster royal infirmary and Mexborough Montagu hospital. Despite this, the unit managers insist on going ahead with their plans. They have no plans to ask the people of Doncaster or NHS staff what they think.
Plans for opting out are not opposed just by health authority members. Doncaster metropolitan borough council commissioned a MORI poll of the town to test public opinion. I have the results here. On the question of opting out, 68 per cent. were strongly opposed, and only 4 per cent. showed strong support. It is worthy of note that opposition was strongest among the users of the local hospitals, among the less well-off and among the elderly. They know, as Opposition Members know, that they will be the ones who lose as a result of this headlong rush into commercialised health care.
I do not wish to give the impression that Doncaster is isolated in its opposition. That would be far from true. We have ample evidence from around the country that there is strong opposition to the plans for the future of the National Health Service, in particular to the opt-out proposals. I use advisedly the phrase "the future of the National Health Service". Some would argue that, in the face of the National Health Service and Community Care Bill, the very future of the National Health Service, free at the point of need and funded from general taxation, is questionable.
Unlike the Labour Government of 1945, who brought the NHS into being and who had a mandate from the
1122
electorate to do so, this Government have no mandate for the introduction of opted-out hospitals. Nowhere in the Conservative party's election manifesto were these changes mentioned. Nowhere have the Government tested public opinion. Nowhere have we seen overwhelming support for their proposals. What we have seen is concerted opposition to opting out from all sectors of the community and from all sectors of National Health Service staff, with the notable exception of the unit and district general managers who are on short-term, performance-related contracts.
Even among the latter group there have been instances where managers have abided by the wishes of their local health authority members and ceased work on the preparations for opting out. Throughout the country, the views of health authority members, community health councils, staff, patients and the public are being ignored—not by accident or omission but by deliberate policy.
The Secretary of State for Health apparently believes that those who oppose the Government's plans are mistaken. If he thinks that he can dismiss the views of medical staff, patients and the public, and if he thinks that he can continue to denigrate their views and opinions, it is he who is mistaken. There is strong and widespread opposition to the Government's opt-out plans. I have evidence of ballots of staff and local communities who time and again have rejected the introduction of competition into health care provision.
I shall identify just a few examples. In North Tyneside, where the whole health authority expressed an interest in opting out, 97 per cent. were against; in Reddish, 81 per cent. were against; in York district hospital, 91 per cent. were against; in Plymouth health authority, 75 per cent. of the consultants were against. I could go on. The House knows, and the Minister knows, that there are many such examples.
It is interesting for the House to note that, out of a staff of 3,500 balloted in North Tyneside, 2,500 returned their ballot papers. Even if all those unreturned ballot papers were counted as votes in favour of opting out, the result would still show a majority against. Even using the Government's own peculiar criteria for ballots, as demonstrated by the housing action trust ballots, the result is still the same—opposition.
I know that the Secretary of State and his supporters will dismiss the ballot results as meaningless. It has been said that the question asked determines the answer. I challenge the Secretary of State to frame a question that will not elicit an overwhelming majority against the opt-out proposals. I strongly support the statements made in Committee by my hon. Friend the Member for Peckham (Ms. Harman) that the questions are not biased and that public opinion is against the Bill.
The Government maintain that the proposed changes to the fabric of the National Health Service will increase patient choice. We hear a great deal about choice. Working papers on the National Health Service and Community Care Bill point that there should be consultation before any self-governing trust is formed. This consultation will, however, be limited.
I urge hon. Members to support my proposals for local referendums. Some would say that they are modest. I know that several local authorities have called for a national referendum on the Government's proposals. The idea is not new, nor is it unusual. We have had a

1123
referendum in this country before, and it is common in other European countries to hold a referendum on a specific issue.
The Government have stated that they are committed to the development of decision making in the National Health Service. They want to make hospitals more responsive to local needs. Surely the logical step would be to elicit the views of those most directly involved—the staff, the patients and the community. I urge hon. Members of all parties to support my proposals for local referendums to allow British people to choose whether their local hospitals should be allowed to become self-governing trusts, to decide about competition in health care and opting out of local health authority control and to withdraw expressions of interest when the people have said quite clearly, "We are not interested in opting out." I move my Bill for the sake of democracy.
Question put and agreed to.
Bill ordered to be brought in by Mr. Martin Redmond, Mr. Michael Welsh, Mr. George J. Buckley, Mr. Don Dixon, Mr. Harry Ewing, Mrs. Alice Mahon, Mr. Peter Hardy, Mr. Tom Cox, Mr. Ray Powell, Ms. Dawn Primarolo, Mr. Alan Meale and Mr. Eric Illsley.

National Health Service Hospitals (Opting Out)

  NATIONAL HEALTH SERVICE HOSPITALS (OPTING OUT)
  Mr. Martin Redmond accordingly presented a Bill to provide that a referendum shall be held in a health authority area on any proposal that a hospital in that area should opt out of the National Health Service: And the same was read the First time; and ordered to be read a Second time upon Friday 20 April and to be printed. [Bill 107.]
  Mr. Barry Porter: On a point of order, Mr. Speaker. I wish to raise an issue arising directly out of
  1124
  Question Time when the hon. Member for Newham.. North West (Mr. Banks) was bobbing up and down like a cork on a rough sea. I wish to make a serious point about the rights and opportunities of Back Benchers. The hon Gentleman is knowledgeable about the matters which were being raised during environment questions and it was unfortunate that he was forced to issue an epithet which offended the susceptibilities and sensibilities of some of my hon. Friends and which was not repeatable in polite society.
  Mr. Speaker: Order. I hope that the hon. Gentleman is not being too sensitive. I did not hear that epithet. I am sure that the hon. Member for Newham, North-West (Mr. Banks) is most concerned about the hon. Gentleman's protection of him.
  Mr. Porter: I am not complaining about the use of the epithet. Back Benchers who take the trouble to come to this place and attempt to ask questions, and certainly an hon. Gentleman who, although he offers views which are often unwelcome and wrong, does so in a light-hearted and cheerful manner, should be called more often.
  Mr. Speaker: I do not know what hon. Members say behind their hands when they are unable to be called at Question Time, but the House knows that I am constantly being urged to speed up Question Time. I did allow a rather longer time today on the community charge, or poll tax as I believe it is now called—[Interruption.] Order I hear it described in that way on both the BBC and in the Chamber. But, with the best will in the world, I cannot call every hon. Member who wishes to get in, including the hon. Gentleman.

Orders of the Day
  WAYS AND MEANS
  Order read for resuming adjourned debate on Question [20 March].
  WAYS AND MEANS

    AMENDMENT OF THE LAW
    Motion made, and Question proposed,
    That it is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance; but this Resolution does not extend to the making of any amendment with respect to value added tax so as to provide—

    (a) for zero-rating or exempting any supply;

    (b) for refunding any amount of tax;

    (c) for varying the rate of that tax otherwise than in relation to all supplies and importations; or

    (d) for relief other than relief applying to goods of whatever description or services of whatever description.—[Mr. Major.]

    Question again proposed.

  Budget Resolutions and Economic Situation
  [Relevant documents: European Community Document No. 9487/89 on the Annual Economic Report 1989–90 and the un-numbered Explanatory Memorandum submitted by HM Treasury on 31st January 1990 on the final version of the Report as adopted by the Council.]
  Mr. Speaker: In view of the great number of right hon. and hon. Members who wish to participate in the debate, I propose to put a 10-minute limit on speeches between 6 and 8 o'clock this evening.
  3.43 pm
  Mr. John Smith: I congratulate the Chancellor of the Exchequer on the pleasant and competent way in which he introduced his first Budget. I am sure that he was very glad to get it over. On the substance of his proposals and their relevance to Britain's economic predicament, I fear that I cannot be so congratulatory—not that the formal proposals in the Budget will detain us too long in the debates of which today's is the precursor.
  Many of the non-controversial proposals in the Budget will attract little, if any, hostility from any quarter. The move to independent taxation was signalled in previous Budgets, even if it is now at the point of implementation. There is widespread approval for the introduction of independent taxation of men and women, even if there will be serious debate about some of the details, such as whether the new married couple's allowance should be capable of being distributed between spouses rather than being given automatically in the first instance to the man.
  Useful changes in the administration of VAT and corporation tax have been proposed. The assistance that will be forthcoming to football grounds will be welcomed as clubs face up to implementing the Taylor report against the background of a sharp increase in rates under the uniform business rate.
  The Government will, I hope, acknowledge the important part played by the Opposition, and by my right hon. Friends the Members for Birmingham, Small Heath (Mr. Howell) and for Birmingham, Sparkbrook (Mr. Hattersley), in debates on the Taylor report, in securing
  1126
  the assistance offered. Sports other than football, such as cricket, rugby union, rugby league and athletics, will also have to face the cost of improvements, and they clearly have a strong case for receiving equivalent assistance.
  In principle, incentives to saving are welcome. It remains to be seen how much the new savings plan will attract new rather than diverted saving, but there is nothing wrong with fiscal incentive for saving. As a means of controlling demand, it makes much more sense than prohibitively high interest rates—"usuriously" high interest rates, as the Chancellor described them the last time they were 15 per cent. in 1981, when he was a Back Bencher.
  Savings have dropped so much in the past decade that incentives are undoubtedly required. Many families in Britain, as they struggle with mortgage repayments, the poll tax and high prices at every hand, will feel that chance would be a fine thing. They have a hard enough task to make ends meet, let alone find £150 a month for a savings scheme.
  Nor will the Chancellor find any objection to abolishing the foolish tax on workplace nurseries which was introduced by the right hon. Member for Blaby (Mr. Lawson) in 1985. I shall not detain the House with an examination of the other measures, because the Chancellor took time to explain them yesterday.
  Mr. Nigel Lawson: On a point of fact, I should like to assure the right hon. and learned Gentleman that at no time did I introduce a tax on workplace nurseries. The tax on workplace nurseries arose out of the tax on benefits in kind, which has been on the statute book for many years under Labour and Conservative Governments. It took positive action by my right hon. Friend the Chancellor to remove it in this year's Budget.
  Mr. Smith: The right hon. Gentleman protests too much. It is quite clear that action was taken in 1985. It may have been based on previous legislative possibilities, but action was clearly taken. What is undoubtedly clear is that Budget after Budget passed but the right hon. Gentleman refused to do anything about it. However, I am glad that he is a participant in these debates again, and I hope that he will rise to his feet to give his views on some of the current problems, for which he bears a heavy responsibility.
  I shall not detain the House by examining in detail the other measures, because the Chancellor properly took time to explain them yesterday. I noticed that in his television broadcast last night, he dealt with them in a few sentences. He was probably right to do so, because they do not amount to very much. One gets the impression that, over the past few months, Treasury officials have been combing the files and searching the shelves for administrative changes that could be usefully offered to a Chancellor who needed to fill out his Budget speech.
  I shall refer later in my speech to the raising of the savings limit for housing benefit and poll tax rebate, because it raises significant issues, not least in relation to Scotland.
  There are significant omissions from the Budget. The Government's so-called concern for the environment found little expression in it. Indeed, the word "environment" was never uttered by the Chancellor. Perhaps I should not place too much stress on that, as the words "medium-term financial strategy" were not uttered

  1127
  either, although I discovered from the Red Book that it remains a crucial part of the Government's economic strategy—so crucial that the Chancellor forgot all about it when he addressed the House.
  Before the Budget, we proposed changes in value added tax, corporation tax and vehicle excise duty, which would have assisted the promotion of environmentally friendly products and acted as a deterrent to the use of harmful products. I hope that it will not be long before the growing, genuine environmental concerns throughout the nation find some positive fiscal expression.
  There was no reference in the Budget to child benefit. Before Conservative Members complain that this is a social security measure, let me remind them that child benefit was a combination of the old family allowance and the child's tax allowance. Had it remained a tax allowance, it would have been uprated in the Budget, like any of the other allowances. Once again, the Conservatives have breached what was thought to be an all-party agreement to update child benefit regularly. It should have been increased to at least £8·60, the amount if it had been uprated in line with inflation since 1987. It would have been highly appropriate if the Chancellor had signalled an intention to return to an honourable course of dealing, from which the Government have so significantly departed.
  The Chancellor, at the start of his speech, described his objectives as "to bring inflation down" and to enable Britain to seize the economic opportunities of the 1990s. I am happy to accept these as important economic objectives, but the right hon. Gentleman's Budget is at best irrelevant, and at worst harmful, to both.
  This Government have said more about inflation than any other Government in history. At the last election, many hon. Members were rash enough to assure their electors that the problem had been solved. Not that long ago, the Prime Minister talked absurdly in the House about moving towards zero inflation. Extensive talk, bountiful promises—miserable action. Let us get one thing clear about inflation in modern Britain: it is not, as the Government would have us believe, some satanic force which invades us like a mediaeval plague about which little can be done except to toil manfully to mitigate a scourge for which no one can really be held responsible.
  Does inflation, for example, come from abroad? Can we, like the Government—who always try to blame others—blame the nasty foreigners for our problems? There was a hint of that in the Chancellor's remark in his Budget speech that inflation was
  "a problem common to all nations".—[Official Report, 20 March 1990; Vol. 169, c. 1010.]
  which was qualified by the words "to a degree."
  In the circumstances, that was a wise qualification. It is extremely difficult for the Government to mount the argument that inflation has been imported into Britain when Britain is at the top of the European inflation league. Or inflation is at 7·7 per cent. and, as we know, is heading for 9 per cent. The G7 average is 3·7 per cent.; the EC average, 4·6 per cent.; Italy, 5·7 per cent.; Canada, 5·3 per cent.; the United States, 4·3 per cent.; France, 3·4 per cent.; West Germany, 2·6 per cent.; and Japan 1·3 per cent. So we cannot blame the nasty foreigners. The 1980s have been a decade in which the movement of commodity prices has been unprecedentedly favourable for the management of domestic inflation.
  1128
  After 11 years of Conservative government, are we to blame the last Labour Government? The Government might try—they are willing to try almost anything—but I do not think that one will find that one very convincing. The truth is that Britain's inflation is made at home, and the authors are on the Government's Front Bench, with the odd one on the Conservative Back Benches. The explosion of demand, caused by the credit free-for-all and the tax cuts for the rich, far exceeded the capacity of our weakened industrial sector to supply, so we got sharply rising inflation and a plunging deficit in the balance of payments. What have the Government done about that? They constantly push up prices. Despite all the talk about "bearing down" on inflation, the Government keep scoring inflationary own goals.
  Mr. Tim Smith: There is something that I do not understand about the right hon. and learned Gentleman's criticism. He talks about a credit free-for-all, yet two years ago, when the Government admittedly reduced interest rates, he tabled a motion calling for even lower interest rates. What is his policy?
  Mr. Smith: We regularly criticise the Government for the total deregulation of financial services. The hon. Gentleman is correct to say that, in the wake of the stock market crash, I agreed with the action that the Government and the then Chancellor, the right hon. Member for Blaby (Mr. Lawson), took in lowering interest rates, and I think that I was right to do so. Many other countries did the same, and it was a wise course to adopt and to advocate. What I certainly did not propose or support was the total credit free-for-all that was happening prior to that, and the Opposition strenuously and vigorously opposed the irresponsible tax cuts in the Budget of 1988, as the hon. Gentleman knows.
  Despite all the talk about inflation—no Government have talked more about it—this Government have repeatedly scored inflationary own goals. It is the Government who are to blame for increased prices in public transport, electricity and water, for increased prescription charges and for the large rise in council rents that has yet to come.
  It is the Government who have chosen the usuriously high interest rate level of 15 per cent. as their exclusive means of attack. Look at the consequences of that on the mortgage rate and one sees the inflationary result. Take a typical family with a new mortgage of £40,000. In June 1988, the monthly repayment was £267; today the monthly repayment is £420—an extra £153 each month. No wonder wage claims go up as people struggle to make ends meet in the face of such new imposts.
  Now a new twist has been added to the problems of millions of people and a new boost has been added to inflation, and that is the poll tax. Now that the bills are coming in, people in England and Wales are discovering this year, as the people of Scotland discovered last year, what the poll tax means for the ordinary family budget. As the Chancellor conceded yesterday, poll tax levels are about one third higher than domestic rates. In fact, a massive extra £3 billion is to be raised this year. That is the equivalent of adding 2p to the standard rate of income tax. No wonder the Secretary of State for the Environment told us that it would have
  "a devastating impact on the retail prices index".

  1129
  Last year, the average household in England and Wales paid £500 in rates. The poll tax bills arriving from 1 April will be on average 33 per cent. higher than that, at £667—an increase of £167.
  The double effect of mortgage increases and the poll tax is hitting ordinary families hard. Of course, much of the argument has rightly been about the unfairness of the poll tax. It is the most unfair tax in the world; no doubt that is why no other country has adopted it or even thought about adopting it. But it is crucial too, to understand its inflationary impact. The poll tax alone has added more than I per cent. to the retail prices index.
  Mr. David Nicholson: The right hon. and learned Gentleman talks about burdens on working families. Will he give a commitment that the Labour party would not favour replacing domestic rates or the community charge with a local income tax, which would bear down exclusively on working families?
  Mr. Smith: As the hon. Member for Taunton (Mr. Nicholson) knows, the Labour party has proposed a local government tax based upon the occupation of property. That is the proper way to proceed. It is common among most other countries in western Europe and it is the typical form of local taxation in the European Community.
  I note that the hon. Gentleman did not take the opportunity to seek to claim credit for the poll tax. Very few Conservative Members will wish credit for having taken part in devising and implementing the poll tax to be recorded in their political curriculum vitae. I do not notice Conservative Members jostling with each other to take credit for it. No one has asked for it to be called the Baker tax, the Ridley tax, the Rifkind tax, the Howard tax or the Patten tax; indeed, there has been a distinct lack of enthusiasm from that last quarter. If one is to be fair, a proper description of it might be the Thatcher tax. After all, the Prime Minister has pursued it ruthlessly. She has trampled on opposition, on wiser counsels and even on wiser councillors to secure its implementation, come hell or high water.
  However, before we rush to judgment about what the poll tax should properly be called, we should recall the shrewd observations of the right hon. Member for Henley (Mr. Heseltine)—[HON. MEMBERS: "Where is he?"] Well, these days he is probably out working hard for the Conservative party in the country. He is indefatigable in his support for the Government and for the present leader of the Conservative party. I do not know whether the right hon. Lady really understood that, when her right hon. Friend said that he would take no part in any subsequent election for the leadership, he meant that he would not even turn up to vote for her.
  We have to be extremely careful about what the right hon. Member for Henley says. When taking part in discussions on the passing of the poll tax for England and Wales, he told us that it would be called the "Tory tax". I know that these days the right hon. Gentleman could be described as having "a complexity of motives", and one has to be careful when working out exactly what he means, but he was right in the sense that the poll tax is a unique encapsulation of rampant unfairness and explosive inflation. Nothing more deserves to be called a "Tory tax".
  1130
  So much of the Budget has been affected by the poll tax. It bulks large in the Chancellor's assessment of inflationary factors in the economy. It pops up again in the changes that were made in the capital rules for eligibility for housing benefit and poll tax rebate. The Chancellor presented the raising of those limits as if it was the result of some careful consideration and reflection between himself and the Secretary of State for Social Services. It was nothing of the kind. It was a panic reaction to the wave of anger that is running from one end of the country to the other. No doubt it was also a reaction to urgent messages that are coming from places not far from Mid-Staffordshire.
  When the Opposition argued vehemently that the capital limit of £8,000 was far too low, we got little shrift from the Government, but circumstances alter cases, and particularly, by-election circumstances particularly alter cases. Of course we welcome the relaxation of an unjust rule against which we campaigned, but I remind the House that the reduction in potential benefit for all those with capital of more than £3,000 remains in place. I fear that many of those who believed that they might benefit from the doubling of the capital limit may be disappointed by the extent of any relief that they can obtain.
  If the Government are genuine in their concern about the hardship that is being caused, especially to elderly people, why has that concern manifested itself only now, not a year ago when the Government pushed through the poll tax legislation in Scotland and when even the right hon. Member for Henley supported that legislation, like many Conservative Members who were happy about the introduction of the poll tax, provided that it had nothing to do with their own constituents and their own electoral opportunities? We know that spineless Ministers in the Scottish Office did nothing about it. They were not bothered by Tory councillors resigning. If many Tory councillors resign in Scotland, there will not be any left at all. Scottish Tories are so adrift from what is happening in their own country and from the circumstances of life there that they sought nothing by way of alleviation of that rule and, as a result, nothing was done.
  The Government now have to explain what they are going to do about the injustice of the poll tax which has been inflicted over a substantial part of the kingdom without any relief being offered for the year of suffering that has just gone by. Why did the Government do that? The answer is not complex or difficult. As was clear from the Chancellor's demeanour yesterday, I do not think that it was a calculated plot against the interests of the people of Scotland. It was much simpler than that. Once again, the Government forgot that Scotland existed. When the Chief Secretary to the Treasury replies, I ask him to outline the Government's proposals to remedy that injustice, which many Opposition Members find totally intolerable.
  Therefore, high interest rates, mortgage rises and the poll tax are the reasons why the Government have failed to combat their own home-grown inflation. I have a simple message for them: "Stop causing inflation if you want to bring it down".
  Mr. Alex Salmond: I endorse everything that the right hon. and learned Gentleman has said about the capital limits concession announced yesterday. Given that I understand that it will take four years to repeal the poll tax before a capital value tax can be introduced by a Labour Government, will he give a

  1131
  guarantee that he will find a way to introduce backdating to alleviate the great injustice done to many people in Scotland last year?
  Mr. Smith: The hon. Gentleman's assumption that it will take us as long as four years to sweep away the poll tax and to replace it with something better is absurd. That may be his estimation of how long it will take, but it is not ours. A Labour Government will always take care to ensure that people are treated fairly throughout the whole of this United Kingdom from one end to the other. It is the Government's own fault in introducing legislation in one part of the country which they were not prepared to introduce in another part, which has given rise to this very problem.
  Mr. John Townend: If the Government are so unfair to Scotland and do not think about it, can the right hon. and learned Gentleman explain why public expenditure per head is much higher in Scotland than in England and much higher than it is in the north of England, which has problems far greater than those of Scotland?
  Mr. Smith: The hon. Gentleman is riding one of his usual hobbyhorses. Expenditure levels in Scotland are assessed at their present rate, no doubt, because the case has been properly made for the expenditure to be set at that level. If that is not so, the Chancellor of the Exchequer should tell us as he has just sanctioned a lot of the public expenditure proposals in the Autumn Statement. I note that the right hon. Gentleman points to his right hon. Friend the Chief Secretary—I hope that he does not think that he is any better at explaining these things than he is. No doubt the Chief Secretary can deal with that interesting inquiry from his hon. Friend the Member for Bridlington (Mr. Townend). I have one word of advice for the Chief Secretary: he should keep his hon. Friend south of the border, because the Tories are in enough trouble already without sending him north to ask such questions against the background of Scottish political opinion.
  The second of the Chancellor's objectives is to promote economic success in the 1990s, and that shows how supremely irrelevant the Budget is to Britain's real situation. What is our economic situation today? What economic policy should be adopted for the 1990s? The Chancellor was forced to admit that all was not well. For this year, overall growth will be just 1 per cent., inflation will remain depressingly high, interest rates will be kept up and the trade deficit will still be heavily in the red this year, next year and the year after. Fixed investment—an alarming statistic in the small print of the Red Book—is set to fall this year by 1·25 per cent. and by three quarters of 1 per cent. in 1991. That is a significant downward revision even from the Autumn Statement of November 1989.
  In an ominous remark in his speech, the Chancellor observed that the
  "downturn may become quite sharp."—[Official Report, 20 March 1990; Vol. 169, c. 1012.]
  Quite a change from the Budget of 1988, from those happy, heady days when the right hon. Member for Blaby was assuring us that we were undergoing an economic miracle comparable to that previously enjoyed by West Germany and still enjoyed by Japan. The present Chancellor could not but join the act as well and, during consideration of the Finance Bill in 1988, he told us:
  1132
  "During the 1960s we praised and envied the German economic miracle. In the 1980s the position has been precisely reversed."—[Official Report, 26 April, 1988; Vol. 132, c. 214.]
  Let us look at the facts and statistics of Britain's present situation. At the beginning of the decade, the trade deficit with West Germany was less than £1 billion; it is now heading for £10 billion. In the context of the European Community and the wider world, Britain's true predicament is exposed.
  I have already said that the United Kingdom is top of the inflation league. The sad and depressing fact is that we are also at the top of the trade deficit league and at the bottom of the growth league. We have a much higher trade deficit than any other EC country. The G7 and EC averages are in surplus. The other EC countries which are in deficit have a much smaller deficit than we have. In the growth league, although the United Kingdom achieved 2·5 per cent. growth in 1989, the G7 average was 3·5 per cent. and the EC average was 3·6 per cent.
  What is worse is that, for 1990 and 1991, the OECD predicts higher growth for all the other leading countries, in both the European Community and G7. There is no room for complacency for an economy and country that are top of the inflation league, top of the trade deficit league and bottom of the economic growth league. Things have gone wrong, and they need to be put right.
  Sir Peter Tapsell: How can the right hon. and learned Gentleman account for the undoubted fact that international financial opinion is far more worried by the possibility of another Labour Government than by any of the statistics that he has just quoted?
  Mr. Smith: I do not know to whom the hon. Gentleman speaks when he is abroad, and it may well be to people who share his political opinions, but on any objective basis—I find, increasingly, that people are objective about such matters—there is no foundation for his proposition. It might occur to the hon. Gentleman that the strains and stresses that sterling is under today—he knows perfectly well that sterling is under strain—have everything to do with yesterday's Budget and the present economic fundamentals of this country. I hope that hon. Members will not try to steer genuine political debate into the sort of scarifying cul-de-sac that the hon. Gentleman wishes us to enter. It is up to the Government to run sensible economic policies in this country, and their failure to do so causes pressure on the currency, whether from home or abroad.
  The core of the problem, and what has, above all, gone wrong in the past decade, have been the neglect of the manufacturing sector. Investment in the 1980s has been hopelessly inadequate to secure the new technology and extensive development of skills that should have occurred during this decade. That is why we need a crucial change of policy and the adoption of a strategy for industrial recovery. The move towards a competitive and productive economy, which alone can secure our success, has yet to occur in this country. To achieve it will be the vital task for the 1990s.
  We must adopt a framework of policies which permits interest rates to come down and stay down. That is why the Labour party advocates that the Government should begin negotiations to join the exchange rate mechanism of the European monetary system. Stable exchange rates would give British companies the confidence that they need to invest, and joining the European monetary system

  1133
  would help to lower interest rates and reduce inflation. What the Chancellor said on the subject yesterday, was, to put it mildly, distinctly unhelpful.
  In addition, the Government should reverse the cuts they have made in public expenditure programmes, training, support for industry and regional development. It is quite absurd that, at this crucial time in the development of our economy, public expenditure cuts should be made in those sectors.
  Mr. A. J. Beith: I agree strongly with the commitment that the right hon. and learned Gentleman has made to early membership of the European monetary system, but will he say how inflation can be kept down while interest rates are brought down under this regime?
  Mr. Tristan Garel-Jones (Treasurer of Her Majesty's Household): Do not answer that question.
  Mr. Smith: I shall not follow the advice of the hon. Gentleman, and I shall answer the question.
  The hon. Member for Berwick-upon-Tweed (Mr. Beith) knows perfectly well that the advantage of being in the exchange rate mechanism is that we shall have stability of the exchange rate. That is the prize that we gain and the objective that we secure if we join—[Interruption.] If the Financial Secretary of the Treasury wants to ask me questions, will he kindly get to his feet and do so?
  The Financial Secretary to the Treasury (Mr. Peter Lilley): The exchange rate mechanism of the EMS is a commitment to keep the exchange rate stable, not a magic potion that achieves that end painlessly.
  Mr. Smith: The hon. Gentleman is adept at expressing the obvious. When we enter it, as I hope we will, we shall accept certain disciplines. We have the obligation to maintain the exchange rate within a certain band. Monetary policy is relevant to that. It does not mean that monetary policy must be dedicated exclusively to that single objective—there are domestic concerns too, but it becomes a principal concern of policy.
  Before the Financial Secretary to the Treasury makes any more grimaces, I should remind him that he was a member of the Government who were busy shadowing the deutschmark. I do not know if he is so keen on maintaining and defending that policy now—it appears to have had a mixed reception, or at least a mixed recollection, among right hon. and hon. Members of the Government Benches—but the prize that we can gain from joining is exchange rate stability, the confidence that flows from it and the capacity to operate the economy at significantly lower interest rates, which will help generate the investment, particularly in the industrial sector, that the country needs so much.
  The public expenditure component is also important. There must be Government support and involvement, particularly in education and training, which have been so grossly neglected in the past decade, principally because of the Government's desire to eschew responsibility for it. The right hon. Member for Blaby used to say time and again that training was a matter for companies—but training is too important to be left exclusively to
  1134
  companies. It gives people opportunities and it adds to our economic strength; it enlarges personal opportunity and increases the wealth of the community.
  There also ought to be—this is relevant both to our present situation and to the Budget debates—fiscal incentives for investment in new technology, particularly in manufacturing. I hope that the Government will give careful consideration to that as we proceed with the Budget debates.
  I have, therefore, recommended a European initiative, a public sector expenditure commitment and a fiscal strategy to help us make sure that investment, particularly in manufacturing, is increased and maintained at the levels necessary if we are to be successful in the 1990s; but I select training as the matter that needs particular attention.
  I notice that, although the Government talk a lot about training now, and although they have set up the training and enterprise councils, quite a number of people are expressing concern about the cuts that have been made. The Guardian of 17 March said:
  "Mr. Christopher Johnson, chief executive of Wedgwood and a director of the Staffordshire training council, said Staffordshire's budget had been reduced from £50 million to £35 million. He said, 'We cannot survive without better training standards. When we set out last year we had high hopes, but now the Government keeps on changing the goal posts.'"
  That is the view of the Government's own appointee in the Government's own system, operating the Government's own policy. He appears to have lost confidence in their commitment to education and training. Yet this is the area that stands out above all others because, in the modern economy, it is the development of skills that counts more than anything. Our competitors in Europe know that perfectly well; our competitors in newly industrialised countries know it. That is why they have a massive commitment to education and training. They know it and they act upon it, but this do-nothing Government seem incapable of assessing the nature of the challenge, let alone of devising a strategy to meet it in the 1990s.
  Britain will not make the crucial move to a genuinely productive and confidently competitive economy until the Government understand and accept their own responsibility to lead a partnership between themselves and industry to achieve these goals. Once again, in their irrelevant Budget, the Government have shirked their crucial responsibility to initiate economic policies which permit our industry and our people to compete on equal terms in the new European market. For Britain to have a real future in the 1990s, it needs above all one crucial change—a change of Government.
  4.19 pm
  The Chief Secretary to the Treasury (Mr. Norman Lamont): We have heard a speech from the right hon. and learned Member for Monklands, East (Mr. Smith) which, as always, had its entertaining moments. We know from him that he sees it as his function to entertain. In a newspaper interview the other day he said that unless he entertained, he could not hold the attention of his colleagues. They should be warned that he has a low opinion of the attention span of most of his colleagues. We can certainly say of his speech that it was almost up to his usual level of entertainment and certainly up to his consistent level of content.

  1135
  The Budget is right for our economic circumstances. It is cautious, prudent, firm and neutral, but accompanied by a tight monetary policy that the Government are determined to maintain until inflation is markedly reduced. To those who say that the Budget has not been tight enough, we point to the large fiscal surplus which is unequalled by any country, except Japan. The background to the Budget has been an economy which has shown extraordinary resilience. It is wholly misleading of the right hon. and learned Gentleman to say that in one year Britain will be bottom of the growth league when we have been grappling with the problem of too high growth. He should know that, even when we take account of the lower rate of growth predicted by my right hon. Friend the Chancellor of the Exchequer in his Budget statement, in the 1980s Britain will have grown faster than France or Germany. That could not have been said in the 1960s or the 1970s, so he was misrepresenting the position.
  Our economy needs to slow down after the extraordinary growth of recent years. Clearly, the process has begun, but it needs to slow down further. It is not too much to ask British business or the British people to accept a period of pause after a period of such rapid and extraordinary growth for so many years.
  Mr. Nigel Griffiths: Although the Government are forcing British industry and the British public to slow down, are not Germany, France and Japan, our competitors, speeding up, flooding this country with imports and meeting markets that we cannot meet because of the damage that the Minister and his party have done to industry?
  Mr. Lamont: If the hon. Gentleman had been listening, he would have heard me explain that for a whole decade we have been out-performing our competitors in growth. The fact that we shall have one year of slower growth in no way denies that achievement.
  The tax measures are broadly neutral. It is a remarkable testimony to the Government's tax-cutting record that this Budget is the first since 1981 to reduce neither income tax nor national insurance contributions. My right hon. Friend avoided the temptation of fiscal finetuning. Many people will agree that merely to increase taxes by £1 billion, £2 billion or £3 billion in an economy of over £500 billion would be marginal and make no difference.
  It must be obvious to everyone that the present increase in inflation has its origins in monetary policy. It is partly the result of interest rates being cut too much in 1987 in response to the stock market crash. At that time the right hon. and learned Gentleman urged us not only to cut them further, but to give a fiscal stimulus to the economy to increase public spending. Part of the problem has been caused by the British people's confident outlook for the future.
  The boom of the past few years has owed absolutely nothing to any fiscal stimulus from the Government. Government spending has increased only slowly over this period and it is a convenient fiction, which the right hon. and learned Gentleman wishes to nurture, that the 1988 Budget cut taxes massively. Many argue that the 1988 Budget, which generated a larger than expected surplus and increased revenues, could he described as increasing taxes and creating a budget surplus of a kind that we had not seen for many decades.
  1136
  The growth in demand in this country has been the response of United Kingdom firms and individuals to financial deregulation. The private sector, both companies and individuals, has borrowed heavily and moved into financial deficit on a scale not seen for years. This rapid growth in private sector spending has been essentially an expression of confidence about the economy and its prospects.
  Companies went into deficit to finance an investment boom. In 1987 and 1988 investment grew by 23 per cent., its fastest-ever growth in a two-year period and twice as fast as consumption. So it has not been just a consumer boom. It has been too much growth across the whole economy. That has been an expression of confidence, because firms do not invest if they do not have confidence in the future.
  Clearly, this remarkable growth in demand has been a monetary one. That is why the response should also be a monetary one, of higher interest rates. This is not so much a question of one-club golf as of not attempting to play golf with a cricket bat or to play cricket with a golf club. We would not get far against the West Indies' bowling if we dangled a No. 2 iron in front of our wicket. Against that background, the response of the Government has been entirely appropriate.
  The right hon. and learned Gentleman suggested that the reliance on interest rates is obscure dogma not followed by other countries. He seems to forget that a few years ago the United States had to put up interest rates to over 20 per cent. to cope with a temporary surge in inflation. Australia currently has them at over 17 per cent.
  Interest rates are, of course, a means to an end. The right hon. and learned Gentleman seems to regard them as an end in themselves. At times, our interest rates may have been higher than those of some other countries, but that has not—despite the fact that we have used interest rates consistently to control the economy—prevented us from having a faster rate of growth than the rest of the EC. It has not prevented us from having a better performance on investment and productivity than the rest of the EC. Our reliance on interest rates has not prevented us in the past few years from having a far higher rate of employment growth than the rest of the EC.
  The right hon. and learned Gentleman returned to the question of credit controls. He seems to be in two minds about that, but there is no lawyer who cannot argue two sides of a question simultaneously. In his interviews on radio and television, he sometimes expresses reservations about them. He and the Leader of the Opposition use a curious phrase. They say, in effect, "We recognise that credit controls cannot be hermetically sealed." The right hon. and learned Gentleman has used the curious phrase "hermetically sealed" three times and the Leader of the Opposition four times. I do not know whether they have been memorising a brief, or whether it is pride of ownership. They seem to be saying that they recognise that, in the end, credit controls will break down; but they hope that they will work for a little while.
  I see little attraction in following a policy which one recognises from the word go is doomed eventually to break down. Credit controls were abandoned in this country before the City of London had become as international and as deregulated as it is today. It would be far more difficult to make them work today. We cannot have credit controls without the reimposition of exchange controls. Perhaps that is what the right hon. and learned Gentleman

  1137
  has in mind. Of course, he would not tell us or the markets, but without the reimposition of exchange controls, they would not work.
  Opposition Members have said that it would not be easy for the average consumer or shopper to open a bank account in an offshore bank. That may be so, but that is not the point and it is not necessary. It is easy for a store, finance house, retailer, wholesaler or manufacturer to borrow from abroad and to extend credit domestically. The right hon. and learned Gentleman is wrong to advocate credit controls, and he knows it.
  The right hon. and learned Gentleman welcomed some of our savings measures, and there has been a warm welcome in the country for the many imaginative and far-reaching proposals in the Budget to help us to raise our savings ratio. There has been a fall in our savings ratio, as there has been in a number of countries, including the United States, Germany and Japan. One reason for that fall is the increase in borrowing which reflects the spread of home ownership. To some extent, the perceived fall in the savings ratio is merely the spread of home ownership through increased mortgage borrowing. But we need to increase our savings ratio, and that is what the Budget measures are designed to achieve.
  Mr. Peter L. Pike: The Government may want to help savers, but why do they not recognise that many people in Britain cannot afford to save? In my constituency and in many other parts of the country millions of people will not be able to pay their poll taxes, their increased rents and their mortgage payments, let alone save, so the Government's measures will be no use to them at all.
  Mr. Lamont: The hon. Gentleman is close to saying that there is no point encouraging anybody to save because nobody can afford to save. The whole point of the new tax-exempt special savings account is that it is designed not for the stock exchange investor or the wealthier person, but for the person who wants to save modest amounts. The tax-exempt special savings account will help the individual with a small capital sum—for example, the person approaching retirement—and it will enable the younger saver to accumulate capital, even if he is earning only a modest amount and can regularly put aside only a small sum. I am sure that the 34 million people who put money into banks or building societies will find the tax advantages of this new facility very attractive.
  Mr. Dennis Skinner: The point is that measures to encourage savings cannot be hermetically sealed. In other words, they will affect some people, but not everybody. The British people want to know how on earth the Government can continue a policy that is based on high interest rates but, when anybody puts forward an alternative, such as credit controls or exchange controls, the Government cast it to one side. The Government's policy is based on a 15 per cent. interest rate which has lasted nigh on 12 months, looks like lasting another 12 months and might be 18 per cent. before the end of the year, yet will bring down the balance of payments deficit by only £5 billion. That policy is leading to chaos. The wheels have dropped off it.
  Mr. Lamont: The hon. Gentleman is a bit off his trolley. High interest rates have brought down inflation in the past, and they will do so again.
  Another measure that is designed to encourage savings and which I think will be warmly welcomed is the abolition of stamp duty. As my right hon. Friend the Chancellor explained, the stock exchange will move to a new paperless system of transactions, and even the most ingenious would find it difficult to levy stamp duty on non-existent documents. We hope that the abolition of stamp duty will improve the City of London's competitiveness and give a further boost to wider share ownership. I am sure that my hon. Friends were extremely encouraged that my right hon. Friend the Chancellor was able to announce yet another increase of 2 million in Britain's share owners—no less than one in four of the adult population—following the flotation of the Abbey National.
  By abolishing the composite rate tax, the Budget has also removed what many people—including the hon. Member for Berwick-upon-Tweed (Mr. Beith)—have regarded as a long-standing injustice. In the past, the composite rate tax has applied even to those people with incomes below taxable level. That may have been tolerated in the past, but the introduction of independent taxation threw into relief the injustice that would be done to many married women, especially those with small savings incomes. Therefore, its abolition will surely be widely welcomed.
  I had hoped that the Labour party would give a warmer welcome to some of the measures, but it has never been the party of the saver. It seems to have the odd idea—both in its policy and by its past action—that saving can be encouraged by the curious notion that deferred consumption should be more heavily taxed than present consumption. That was the thinking behind the investment income surcharge. We all know how badly savers did when the Labour party was in government. It bequeathed to us an economy in which pensioners were robbed of a large part of their savings; real interest rates were low and often negative; and those who put money in a building society in 1974 would have seen the real value of their savings fall by 20 per cent. by 1979. It was a cruel injustice, and one that we must never let happen again.
  Mr. John Smith: If the Conservative party is such a party for the saver, why has the savings ratio dropped so alarmingly during the past decade?
  Mr. Lamont: The right hon. and learned Gentleman's attention span is obviously the same as that which he ascribed to his colleagues. I have explained at considerable and, no doubt, rather tedious length that the rise in mortgage borrowing has much to do with the fall in the savings ratio.
  Perhaps the right hon. and learned Gentleman does not really understand what the savings ratio is. Perhaps he will tell us about his policy for savings. The other day he warmly endorsed a Fabian Society report urging a future Labour Government to reintroduce an investment income surcharge for those under pension age, by charging national insurance contributions on savings incomes; to tax the income and capital gains of pension funds; to charge—this is really bizarre—national insurance contributions on capital gains; and to end retirement relief for small business men. That is not a very convincing way to

  1139
  encourage savings. It may or may not be Labour party policy, but it is curious that it should be given even the most modest encouragement or endorsement.
  Mr. Norman Tebbit: Sitting where I do, I have a slight advantage over my right hon. Friend. I distinctly heard the right hon. and learned Member for Monklands, East (Mr. Smith)—who speaks for the Opposition as shadow Chancellor—say that those proposals were not Labour party policy. Will my right hon. Friend give the right hon. and learned Gentleman the opportunity to say now, clearly and distinctly, that no Labour Government of which he might be a member would introduce such policies?
  Mr. Lamont: I gave the right hon. and learned Gentleman that opportunity, but—as always when he is asked to answer a question—he merely asked another question.
  Another proposal that has been widely welcomed has been the change in the capital limits that apply to income-related benefits, including community charge relief.
  Mr. Dick Douglas: As the Minister knows, the Budget is a matter for the Government as a whole. We in Scotland are interested to know what part the Secretary of State for Scotland played in agreeing that the cut-off would be at £16,000 for England and Wales, but with no retrospective action for Scotland. Did the Secretary of State for Scotland learn of that in Cabinet and, if so, what was his posture?
  Mr. Lamont: Obviously, that point was considered carefully. It would not be practical to implement the change retrospectively in Scotland, as it would create all sorts of administrative problems and anomalies, and could be done only on the crudest basis. People's incomes, savings and even place of abode may have changed considerably. It would be extraordinarily difficult to introduce such a change retrospectively.
  But there is another argument against retrospection. The capital limits apply not just to community charge benefit but to housing benefit and income support. The rebate that applied to the community charge in Scotland last year applied also to ratepayers in England. If a change were to be retrospective, it would be extremely difficult to justify not making further changes for ratepayers in England as well.
  Mr. Alick Buchanan-Smith: Will my right hon. Friend give way?
  Mr. Lamont: I will give way once to my right hon. Friend. However, as there will be a chance to debate this point later, I do not wish to go much further on it.
  Mr. Buchanan-Smith: I accept that retrospection would involve the problems that my right hon. Friend mentioned, but does he realise that the community charge has brought far more people within the net of local government taxation and that many people, particularly elderly people with savings, have seen the level of their local government taxation rise far above the rate of inflation? In practical terms, therefore, there is an anomaly, an unfairness, which is felt by Conservative Members as well as Opposition Members. If my right hon. Friend cannot do something
  1140
  retrospectively, is there not some other concession that might be considered with a view to compensating for this unfairness?
  Mr. Lamont: I note what my right hon. Friend has said, as, I am sure, will my right hon. and learned Friend the Secretary of State for Scotland. I have explained the problems, which I believe are overwhelming. I do not think that we can make the concession, although I understand the concern of my right hon. Friend. But there will be a chance to debate the matter later.
  Mr. John Smith: I should like to make what I think may be a practical suggestion. I understand that, because of the late arrival of transitional allowances, no payments have been made in Scotland for the current financial year, which has only three weeks to go. In any event, rebates will have to be recalculated. Would it be possible, in that process, to take into consideration changes relating to the previous year, so that account might be taken of the suffering endured during that year?
  Mr. Lamont: One problem is that it is not possible to split community charge benefit from housing benefit. That cannot be done if we introduce the scheme this year, as we want to do. Of course I will study what the right hon. and learned Gentleman has said, but my position and the Government's position remains as it has been stated. That is all that I will say on this subject at the moment.
  Mr. Tony Worthington: On a point of order, Mr. Deputy Speaker. This is quite outrageous. We are supposed to be having a debate, but this is not a debate. The Minister totally refuses to answer the reasonable points made by Opposition Members.
  Mr. Deputy Speaker (Sir Paul Dean): Whether the Minister gives way is a matter for him.
  Mr. Salmond: On a point of order, Mr. Deputy Speaker. Bearing in mind the fact that the Government have already agreed to backdate the transitional payments, which are equally, if not more, complex, is not the Minister in danger of misleading the House in arguing that these payments cannot be backdated?
  Mr. Deputy Speaker: That is not a point of order; it is a matter for debate.
  Several Hon. Members rose——
  Mr. Deputy Speaker: Order. I will take points of order if they are genuine, but the ones that have been made so far have been points for debate.
  Mr. John Battle: On a point of order, Mr. Deputy Speaker. We are in difficulty when a representative of the Treasury addresses the House on social security matters without the Secretary of State for Social Security being here to confirm what he is saying. It seems to me that there is a real danger——
  Mr. Deputy Speaker: Order. These are perfectly legitimate matters for debate, but not points of order for the Chair.
  Mrs. Maria Fyfe: On a point of order, Mr. Deputy Speaker. As has been said by other hon. Members, the Minister is misleading the House. It is

  1141
  perfectly possible to calculate housing benefit and poll tax rebate. Local authorities in Scotland have been doing it for the past year. It involves no difficulty at all.
  Mr. Deputy Speaker: Order. It is clear that these are not points of order. We should get on with the debate.
  Mr. Nigel Griffiths: On a point of order, Mr. Deputy Speaker.
  Mr. Deputy Speaker: If it is a genuine point of order, I shall take it.
  Mr. Griffiths: It is genuine, Mr. Deputy Speaker. By what mechanism would it be in order for the Secretary of State for Scotland to come to this House and explain whether he is going to fight for the backdating of this benefit? Thousands of senior citizens and other people in Scotland have been penalised over the past year because of the unfair way in which the tax has been applied.
  Mr. Deputy Speaker: It is not for the Chair to advise the hon. Gentleman on tactics.
  Mr. Lamont: The analysis of the British economy by the right hon. and learned Member for Monklands, East is wholly flawed. The right hon. and learned Gentleman seems to have an infinite capacity for grabbing the wrong end of any stick that happens to be around. He believes that our economy is beset by long-term structural problems, with a weak supply side, demoralised businesses, and a work force crying out for Government intervention. One thing is clear: these are not the problems of the British economy.
  The right hon. and learned Gentleman's analysis is wrong, so, inevitably, his prescription is wrong. Our problems are precisely the opposite of those that he described. Our supply performance has been strong, and confidence is high. As I said earlier, the growth of the economy has been too strong. Even taking account of the slower growth that we expect in the coming year, the United Kingdom will have recorded higher growth since 1980 than either France or Germany. That is a demonstration that the British economy has transformed itself and is doing better than ever.
  The right hon. and learned Gentleman referred to manufacturing. From 1980 to 1989, the output of United Kingdom manufacturing industry grew faster than that of either France or Germany. The right hon. and learned Gentleman is looking at the wrong problems and is therefore putting forward the wrong solutions. But the Opposition's solutions are always the same: more public spending on training, research and development, and education. The reality is that many of these matters are being tackled by Government and by business. Already, employers are spending £20 billion a year on training. On top of this, Government expenditure is about £2·5 billion a year. Companies spend £5 billion a year on research and development. Indeed, they increased their spending by 46 per cent. between 1983 and 1988. The evidence that the supply side of our economy is strong is clear. The right hon. and learned Gentleman's analysis is wrong.
  The right hon. and learned Gentleman made no mention of the measures in this Budget to help smaller businesses. We know that the Labour party, with its corporatist approach, is interested only in large businesses
  1142
  —it cannot focus on small businesses. The fact that 300,000 out of 350,000 businesses in this country pay the small rate of corporation tax means that the changes in my right hon. Friend's Budget will help many parts of British manufacturing and other industry.
  This Budget will be judged by what it does for inflation. The Government have brought inflation down from the disastrous levels that it had reached under the Labour Government, of which the right hon. and learned Gentleman was a member. The battle against inflation has to be fought year after year, but it is not one that the right hon. and learned Gentleman has ever shown any willingness to fight. In an interview with The Daily Telegraph recently, he said that getting inflation down was not his top priority; it was just one of several priorities. To the Government, it is more important than that: inflation remains our top priority.
  The right hon. and learned Gentleman is also wrong in his comments about the current account. The current account deficit is a symptom of our excess demand, not of weak supply side performance. If that were not true, we should not have the extraordinary resilience in British exports that has been shown in recent months. As demand has slowed, exports have rebounded strongly. In 1989, the volume of manufactured goods exports rose by 11·5 per cent., the highest recorded rise since 1973.
  The truth is that our problems now are modest compared with those that the country faced in the past, and modest compared with the problems when the right hon. and learned Gentleman's party was in office. He would have given a lot to have had some of our present problems when he was in office: too much growth, too much investment, and inflation under 8 per cent. In one of the right hon. and learned Gentleman's speeches, he congratulated the Labour Government on having got inflation down to under 8 per cent. For us, inflation at its present level is a setback, not a matter for self-congratulation.
  Our economy is certainly strong. The right hon. and learned Gentleman's analysis is not correct. However, the real question is whether the policy is succeeding in slowing down the economy enough. At this point sometimes the good news can become the bad news and the bad news the good. Is it good news or bad news that employment growth was slowed? Is it good news or bad news that last year growth reached almost 3 per cent.? Mr. Samuel Brittan, commenting on the recent retail sales figures, said:
  "A nation whose main economic problem is the shops are too full of goods which people can afford to buy is hardly experiencing a tragedy."
  Our citizens have experienced very sharp increases in living standards, and in recent years a period of extraordinary growth. Sometimes when I listen to Opposition Members I get the impression that they do not realise what the purpose of economics and economic policy is. The purpose is not to achieve a particular level of investment; it is to increase living standards. In that respect, the Government have been conspicuously successful.
  It is curious that not just the previous Labour Government but every Labour Government have found that goal wholly elusive. Since the second world war there have been 17 years of Labour Government and 27 years of Conservative Government. In the 17 years of Labour Government, living standards rose by 14 per cent. In the 27 years of Conservative Government, living standards

  1143
  rose by 78 per cent. Can one suggest that that is a coincidence? The reason is clear: all Labour Governments make the same mistake. This time, however, we are told that it will be different. Quite how it will be different remains obscure because the right hon. and learned Gentleman will not tell us.
  The right hon. and learned Gentleman is the leading Scotsman in his party but, when asked what he would do, he always repeats the excuse of the Irishman: "I would not start from here." When asked what he would do in his first Budget, if he became Chancellor of the Exchequer, he says, "It is too early to say." This is the man who said in an interview in The Daily Telegraph:
  "I have a passion for detail. In detail you find the answers to difficult problems."
  If the right hon. and learned Gentleman is so interested in detail as the answer to problems, perhaps he will answer a few of the questions that journalists and broadcasters have been unable to get him to answer about Labour's tax policy. The other day, poor Mr. Giles Keating of Credit Suisse Boston incurred the wrath of the right hon. and learned Gentleman for asking him some questions about Labour's tax policy. Because he would not answer them, Mr. Keating came to his own conclusions, which were that, as a result of the right hon. and learned Gentleman's policies, many couples without children but below average earnings would be worse off, that those earning only one and a half to two and a half times average earnings could, over time, find themselves paying up to another £4,000 a year in tax and that marginal tax rates would go up from 25 to 50 per cent. What would be the result of this great redistribution? Everybody earning below £18,000 a year would get another £100 a year.
  The right hon. and learned Gentleman says that he believes in fair taxation. To some of us, it seems like the same old incorrigible spite that we have always had from the Labour party. We know that we shall not get any answers from the right hon. and learned Gentleman, because the Labour party is dominated by public relations. It has made a god out of public relations. Quite how dominated by the public relations industry the Labour party is was made clear in a book published recently—"Labour Rebuilt", written by political correspondents of The Guardian and The Independent.
  The book details the use made of a shady group of consultants, known as "the agency," and the use of image-making services as a substitute for policy. Details are given in the book of how Front-Bench Opposition spokesmen have been given advice on how to dress. On page 59 we are told of the analysis given to the hon. Member for Peckham (Ms. Harman). She was asked how she wanted to look. She replied, "Like a confident, assertive, self-possessed woman capable of running things." She was then told, we read, to go and buy a dark suit with shoulder pads—which she did the next day.
  I do not know whether the right hon. and learned Gentleman has made use of that service. We read in the book that the service is used more by men than women but that the men do not talk about it. However, it is clear that the right hon. and learned Gentleman has been given his instructions by the image makers. They are, "Brush your hair, brush your shoes and, above all, don't say anything."
  Mr. D. N. Campbell-Savours: On a point of order, Mr. Deputy Speaker. Will not those who are watching proceedings today feel that what is happening is
  1144
  a disgrace to the House of Commons? This is supposed to be a speech on the Budget but we are getting nonsense from a Minister.
  Mr. Deputy Speaker: That is not a point of order for me.
  Mrs. Fyfe: On a point of order, Mr. Deputy Speaker.
  Mr. Deputy Speaker: Is it a point of order?
  Mrs. Fyfe: That will be for you to judge, Mr. Deputy Speaker. I am worried in case the Minister falls foul of the Prime Minister when he talks about image-making.
  Mr. Lamont: No amount of advice on public relations is a substitute for policy. No policies have been put forward by the right hon. and learned Gentleman. Asked on television last night what he would do about inflation, what did he say? He said that he would not put up taxes but that he also wanted to bring down interest rates. If that is the way to deal with inflation, we know that the only result of a Labour Government would be runaway inflation.
  My right hon. Friend the Chancellor of the Exchequer did not dodge the problems in his speech. He put forward the solution to them. He also emphasised that our problems today should not obscure the real gains that our economy has made in recent years. They include improved productivity, high investment, strong profitability, an end to the decline in our share of world trade, effective control of public spending, improved industrial relations, a fast rise in employment and the lowest national debt relative to gross domestic product since the first world war. The over-rapid growth of the past few years requires a pause. It began last year and will continue this year. However, once the excess demand has been removed, the economy will once again resume its upward trend, with a lower inflation rate.
  Pain there may be, but gain there will also be. By this time next year, the prospects will be distinctly brighter. I commend the Budget to the House.
  4.58 pm
  Mr. A. J. Beith: If the test yesterday had been the presentational qualities of the first television Chancellor of the Exchequer in presenting his first television Budget, he would have come away with full marks. But there was a great deal more at stake: not only his own political future but that of his Government and, in particular, that of his Prime Minister—and, moreover, the ability of the country's economy to weather the next 12 months and the ability of many families to cope over the next 12 months with the enormous pressures on them. I do not believe that the Chancellor passed those tests.
  The Budget will have been greeted with the same great disappointment in many households as it has clearly been greeted in the City and in sections of the press which are normally sympathetic to the Government. If the Chancellor read through the editorials of some of the major national newspapers this morning, he will have read some pretty disappointing news.
  Mortgage payers and poll tax payers will feel that sense of disappointment most acutely, as will the markets to which we look for confidence in the economy and in our currency. The Chancellor has shown that he understands the psychology of his own Back Benchers and his own party. The delight and joy on Conservative Back Benches

  1145
  when he reached the end of the Budget was a demonstration that he knew what they needed and he gave them just a little dose of it. But he has not shown the understanding of the psychology of markets that one would have expected from a Chancellor with banking experience, and he will have to reflect on the absence of that delirium from the City today.
  The fatal weakness of the Budget's strategy is not primarily of the Chancellor's making. It is the Prime Minister's determination that we will not join the exchange rate mechanism of the European monetary system so long as she has the capacity to stop us. That is at the heart of the Budget strategy; and the repetition by the Chancellor yesterday of the same old formula about how long we will have to wait before we enter the exchange rate mechanism did nothing to satisfy voices in so many quarters that are now calling for our entry into the EMS.
  Alongside that was the Chancellor's total failure to face the need for a tight fiscal strategy which would require increases in taxation. In that respect, the Chancellor shares the attitude of those on the Opposition Front Bench. They, too, have not said very much about it and still shown no signs of doing so. They still seem to believe that we can have lower interest rates, a lower exchange rate deficit and lower taxation all at the same time. There seems to be an inability to face the fact that a strict fiscal policy would be particularly needed if we were in the European monetary system. But if we were, it is generally agreed that we could achieve lower interest rates which would help all those mortgage payers who are suffering so badly at the moment and would give a badly needed fillip to industrial investment. But if we are to do so we need a much stronger fiscal policy.
  It is not sufficient for the Government to draw attention to the size of the Budget surplus. It is only half the Budget surplus that they forecast, and it will not meet the problem that will be created by the demand in the economy.
  The Chancellor's speech yesterday gave no sign of a clear and secure policy to deal with inflation. Despite the assertion that inflation would be the judge and jury, the zero inflation for which the Prime Minister aims and the falling inflation which the Chancellor promised only six months ago, there is still uncertainty over monetary policy. It is not quite clear to me from what the Chancellor said yesterday or from the Red Book whether there is any serious monitoring of broad monetary targets. There are certainly none of the tough taxation policies which I have mentioned.
  One of the things that the Chancellor could usefully do is to creep into the residence next door one evening when the Prime Minister is not looking fish out of her wastepaper basket the proposal from the right hon. Member for Blaby (Mr. Lawson) for a more independent central bank and place it back on the Prime Minister's desk with a little note saying, "Please read this again." There may be much merit in having a more autonomous judge of our monetary policy and an institutionalised battle against inflation. We will get that under European monetary union, but why not have it in the meantime by giving the Bank of England greater independence?
  Judgments about these aspects of the Budget are being made in this place and in the City, but judgments about different aspects of it are being made in ordinary homes.
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  The biggest taxation change to have affected many people in Britain for many years is the poll tax. It is a quite dramatic and terrifying change. The Chancellor has done something to alleviate the burden. He has removed a capital limitation which will benefit many pensioners who have savings. That is to be welcomed, but I regret that he has not dealt with the problems faced by people in Scotland who had to bear the full brunt of the poll tax a year earlier. He will have to look at that issue again; it will not go away, and will continue to be raised. He will have to do something to provide justice for people in Scotland.
  The Chancellor must also recognise that he has not done anything for the large majority of poll tax payers who are disqualified from any relief, not by any capital or savings, as they do not have any, but by their incomes even though their incomes are very low. In the past few days, I have attended some very large poll tax meetings in my constituency attended by some very angry people. In the village of Widdrington Station, the meeting was attended by a quarter of the population. I have received a mass of correspondence particularly from people in the Castle Morpeth borough in my constituency, where the poll tax is particularly high. One part of the borough is relatively poor and another part is relatively rich. Therefore, under the Government's safety net scheme, poor people in that area are paying into the safety net to help people who are better-off in other areas.
  I have come across case after case of people who are paying hundreds of pounds a year more in poll tax than they paid in rates. One couple whose income is just over the limit—the man works as a joiner earning £136·89 a week—and whose rates were £255 a year will have to pay poll tax, after all reliefs, of £672 a year. Where can those people find another £400 a year on an income of £136·89 a week? They have no savings. There are millions of people in that position. If the Chancellor intended to do anything about the poll tax for most people, he would have had to provide some extra Exchequer relief for the safety net system for this year and then cleared the way for a sensible income-based tax for next year. Even now, at this late stage, as he has been prepared to make changes to the capital limits, he should have been making changes affecting the majority of people suffering from the impact of poll tax, particularly those who have faced huge increases.
  Mr. Ronnie Campbell: Did the hon. Gentleman advise those people not to pay the poll tax, or will they have to pay it?
  Mr. Beith: What they told me was that they could not afford to pay the poll tax. Unlike some Labour Members, I am not prepared to back a campaign of non-payment of the poll tax. I am not prepared to put in the firing line pensioners who can least afford and least cope with court summonses. I do not believe that many Labour Members are prepared to do that either.
  Mr. Eric Martlew: Will the hon. Gentleman give way?
  Mr. Beith: No. I have just given way and I am answering my near neighbour, the hon. Member for Blyth Valley (Mr. Campbell). I listened to the Labour chairman of the Northumberland county council finance committee saying that he was not prepared to back a campaign of

  1147
  non-payment. He can see what the impact would be on the finances of the county council as it tried to provide social services.
  The Chancellor must realise that many of those people cannot pay and they will be issued with summonses not because they are engaged in any political demonstration, but because they do not have the money out of their income to pay such a high tax.
  The Chancellor made an interesting point about credit. He said that the banks ought to stop the high-pressure advertising of credit. I welcome that, but I suggested it two years ago as one of the ways of trying to limit the credit boom without indulging in ineffective and unfair credit controls. Why was that not said when the Chancellor was Chief Secretary to the Treasury, at the height of the Lawson boom? That would have been a more useful time to make that comment, as that was when most of the credit advertising was pouring through people's letter boxes.
  I welcome what the Chancellor said about savings. The measures that he has introduced are very useful. I particularly welcome, having argued for it last year, the abolition of the composite rate of taxation on building society and bank interest. It is a manifest injustice that pensioners and other non-taxpayers should have tax taken from them to which they are not liable and which they cannot reclaim.
  I am very pleased that the Chancellor decided to change that. If he had made that decision a year ago and not resisted my new clause to last year's Finance Bill, he could have done the preparatory work last year and we would not be in the current position that for one year it will be in the interests of many married women, for example, to open offshore accounts in banks and building societies in Jersey, Guernsey and the Isle of Man. The Chancellor clearly does not want that to happen on a large scale, because he has told banks not to advertise that facility. Nevertheless, I welcome the decision that he has taken, which his predecessor failed to take.
  I welcome the concession on pools duty, which will benefit football clubs at a time when they very much need it, not least as the stand and terrace covering at Berwick Rangers football ground has had to be removed because it was unsafe. I hope that the Football Trust will contribute to the provision of good, safe and comfortable facilities at that ground before too long.
  For a Government who claim to have green credentials, there was an enormous green gap in the Budget. There was little in it apart from the measure on company cars. The Chancellor increased excise duty on petrol, but that partly compensated for not increasing vehicle excise duty. Why did he not take the opportunity to introduce a range of vehicle excise duties that penalise large high-consumption cars? Why did he not seek a tax means to discourage the high consumption of fuel?
  Why did not the Chancellor make progress on taxes on pollution? He may say that he wanted to wait for the White Paper from the Secretary of State for the Environment, but why was there not at least a commitment in his speech to such taxation measures in principle? He could have offered incentives for waste recycling, and given the indication that was so lacking in the Autumn Statement that there will be be sufficient investment in the railways to ensure the access to the Channel tunnel and to ports that industry will need to compete successfully in Europe after 1992.
  As my comments will show, and as other hon. Members have said, there are good and useful small measures in the
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  Budget, but they do not add up to a Budget to deal with the problems facing the country. I do not like to say this about the Chancellor, who still has considerable capital of respect and friendship in the House which he so far has not dissipated, and I hope he will not do so, but he appears to have fallen completely under the control of an increasingly isolated and irrational Prime Minister. The major weakenesses of his Budget strategy are her refusal to enter the European monetary system and her anxiety about the effects of a stronger taxation policy on the immediate political popularity of her Government—and there is not much of that at the moment.
  The Chancellor is obviously pleased that he managed to resist the Prime Minister on one change that everyone knows or assumes she wanted him to make—to raise the £30,000 threshold on mortgage interest relief. That is a very small triumph to set against continued defeat on the exchange rate mechanism and the continued primacy of politics over economics in the decisions that he has taken.
  The Budget may have pleased Conservative Back Benchers, but it has not addressed the problems that the Chancellor will have to face in the next 12 months. In just under a year's time, when I believe he will still be Chancellor, he will be trying to set an election-winning Budget. Messages will come from her next door—perhaps it will be him next door by then—saying "For heaven's sake put together a Budget that can recover the lost ground." The Chancellor will be saying to himself, "I wish that a year ago I had taken a tough line with the problems that now make an election-winning Budget impossible.
  5.13 pm
  Sir Ian Gilmour: I am not sure from the comments of the hon. Member for Berwick-upon-Tweed (Mr. Beith) whether it is his party's policy that we should enter the exchange rate mechanism straight away, but I agree with the Government's view that the current rate of inflation would make that unwise, if not impossible.
  Like the hon. Member for Berwick-upon-Tweed, I welcome many measures in the Budget, which I hope will prove historic for savers, and I applaud the proposals of my right hon. Friend the Chancellor to make it so, particularly the ending of the composite rate of tax. Like everyone else, I welcome the concession on workplace nurseries, and like almost everyone else I welcome the concession for football. I only wish that the reduction in entertainment tax had been doubled, which would have cost little but would have made a substantial difference. Above all, like everyone else, with the exception perhaps of the Scots, among whom I number myself, I welcome the capital limits concession for pensioners on the poll tax, income support and housing benefit. I congratulate my right hon. Friend the Chancellor on those measures.
  I am rather less exultant about what appears to be my right hon. Friend the Chancellor's political and economic strategy. As my right hon. Friend said today and on the wireless, this is undoubtedly the toughest Budget since 1981, but it is a long way from being a tough Budget. It is broadly neutral, and I should have thought that, politically, it would have been far better to have a tough Budget this year and got most of the pain out of the way, rather than having it running on, at a slightly lower level of intensity, to uncomfortably close to the next election.

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  My chief worry about my right hon. Friend the Chancellor's economic strategy is his apparently cavalier attitude, which was rather shared by my right hon. Friend the Chief Secretary today, to the balance of payments. Last year's horrendous deficit of more than £20 billion is due to fall this year to a mere £15 billion. As there will be practically no growth this year, that is fully credible. In the first half of 1991, it is due to fall to £6 billion, but because of the pick-up in growth it will presumably increase quite sharply and will probably be about £15 billion in 1991. That is a most alarming prospect. The problem will not go away or improve merely by being ignored. Its full gravity has not been properly appreciated in public discussion.
  Some people say that the deregulation of international monetary movements has abolished the balance of payments as a problem, but I do not believe that that is true. Some Third-world and European countries have demonstrated that it is not true and have experienced tremendous difficulties with their balance of payments.
  In Britain, we have seen several times the unsettling effect on the pound that even one month's bad balance of payments figures can have, and with a £15 billion deficit projected, it is unlikely that we shall avoid bad figures every month in the next two years. Another story has been circulating that we shall be bailed out by invisible earnings. I have never believed that, because the increase in insurance and tourism would have to be unimaginably large; anyway, invisibles have now gone negative.
  The balance of invisibles may be worse than it appears in the official figures. Page 43 of the Red Book says:
  "The difficulties in measuring certain capital flows—reflected in the large balancing item in the overseas account—and with the valuation of direct investments mean that estimates of net overseas assets are subject to a wide margin of error."
  There have been statistical discrepancies in the balance of payments figures amounting to over £50 billion since 1984. That missing money must be somewhere, and we hope that it is going in the right direction, but if a significant portion of it were to take the form of unrecorded liabilities to foreigners, there would be unrecorded flows of interest out of the country. According to some estimates, the flow of property income could be £7 billion higher than the official figures show. I should be grateful if the Financial Secretary would comment on that interpretation of the residual error, as it is a matter of enormous importance.
  The conventional wisdom has always been that the effect of North sea oil on sterling contributed to the blitz on manufacturing capacity at the beginning of the 1980s, but it enabled us to build up at least £100 billion of foreign assets overseas. It would be a considerable blow if that conventional wisdom was proved wrong and a high percentage of those assets had been spent on the consumer boom. If that had happened, we would have been deprived of the cushion that North sea oil provided and the need to correct the balance of payments problems quickly would be even greater, because we would run the risk of becoming a debtor nation. I look forward to hearing my hon. Friend on the subject.
  The balance of payments position is all the more serious because—if I may differ from my right hon. Friend the Chief Secretary—it is not just the result of recent fast growth. It was deteriorating appreciably before our period of fast growth, and I think that my right hon. Friend will
  1150
  concede that that is true. In other words, there is a major weakness in the British economy. The fundamental cause of our deficit is the slow growth in manufacturing production between 1974 and 1989. Between 1974 and 1979, manufacturing production declined—a point for the Labour party to bear in mind when it makes much, rightly, of the importance of manufacturing industry.
  Between 1973 and 1989, manufacturing output in France increased by 19·5 per cent.; in Germany, by 21·1 per cent.; in Italy, by 37·6 per cent.; in Canada, by 46·8 per cent.; in the United States, by 55 per cent.; and in Japan by 69·9 per cent. In the United Kingdom it has increased by 8·9 per cent., which is a derisory increase compared with those of our chief competitors. Over the past 10 years, our manufacturing output has increased by 1 per cent. per year and our imports in manufactured goods have more than doubled. That is the cause of our balance of payments problem. If my right hon. Friend the Chief Secretary will forgive me, it is not likely to be cured by one year of pause. The problem is deep-seated.
  This dire position surely calls for the Government to do everything possible to help manufacturing industry. Unfortunately, they have not done so. Their sole weapon in fighting inflation—high interest rates—obviously damages manufacturing industry. Despite the eloquence of my right hon. Friend the Chief Secretary, I still believe that it is a considerable mistake to rely solely on interest rates. They have slowed consumption a little, but their impact has not been large enough. We know that they hit borrowers but help savers. Many building societies have eight times as many savers as borrowers, so there is one obvious defect in using that weapon solely. The effect of high interest rates has proved uncertain in its magnitude and their incidence has been arbitrary and unjust. High interest rates have already had a destructive effect on industrial investment and therefore on our future ability to compete on the world market.
  The Government would have been far wiser to raise income tax levels. They should have done so long before yesterday. I believe that the Government should also have used credit controls. The Red Book states that there is a trend against their use in other countries, but nevertheless it shows that other countries still use them. According to Mr. Alex Brummer in The Guardian today, the Bundesbank has issued a paper saying that reserve requirements
  "help control liquidity in the money markets as well as automatically acting as a brake on the creation of money."
  In controlling inflation, what is good enough for the Bundesbank should be good enough for the Bank of England and the Treasury. But my right hon. Friend the Chancellor has decided to continue with high interest rates alone, and I hope that he is right. His Budget is humane and caring, but he has taken a huge gamble on the balance of payments and inflation. I hope that he wins it.
  5.24 pm
  Mr. Bill Michie: Like many Opposition Members, I am disappointed by the Budget and its implications, or perhaps in many cases its lack of implications. It will not help the people whom we have proudly represented for many years. The Budget says little about what will happen to the infrastructure and about whether we will build a new manufacturing base. It says nothing about the caring services—hospitals and housing—and their dilemmas.

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  I often ask myself what the Government consider to be the "nation". Is the nation basically this great global thing, consisting of an economic package, the balance of payments, invisible earnings and all the rest which lead the Government proudly to say that the nation is better off? If so, why is there a deficit in the balance of payments and why have invisible earnings become invisible? The Government cannot be talking about that nation. They must be talking about the other one, in which I believe—the people.
  Are the people better off? I do not see that they are better off in my constituency or in those of many of my hon. Friends. The infrastructure is falling apart. The caring services—whether voluntary or local government—are screaming out for help and for recognition of the problems. Hospitals are closing and waiting lists are increasing. We tried in the past to reduce the housing waiting list from two years, but it is now between 10 and 15 years.
  What is this prosperous nation that we are supposed to have? Where is the magic figure? It is not in the balance of payments or the invisible earnings and it certainly does not exist for the ordinary population in terms of their environment, the caring services, housing and family life. The pressures are continually growing. I deal with many social services matters in my constituency and I know that it is almost impossible for social workers to help the ever-growing number of needy people. The Budget gives not a glimmer of hope that some provision will be made for them later in the financial year.
  We receive many letters from parents and the groups that represent the mentally ill and the mentally handicapped and cannot get the necessary services because of public spending restrictions. Hospital services cannot provide the necessary beds and space, so the authorities try to move people into the community. Social services departments cannot deal with the expense and staffing implications. Throughout the country, and certainly in my constituency, people who would normally be cared for either in an institution or by a social services or area health authority are sleeping rough in our city centre streets and parks. Is that what we call a prosperous nation? Is that the great success story of monetarism, about which the Conservative Government have been talking for years?
  My right hon. and learned Friend the Member for Monklands, East (Mr. Smith) was right to say that the omissions in the Budget are the most worrying features of all—no uprating of child benefit, no promises to provide massive investment in the environment and no increased expenditure to help those who care for the many people who are disabled, ill or in need. Inflation will remain high, as will interest rates, rents and electricity, gas and transport prices.
  The poll tax has affected most of our constituencies. Like any other council in any city, Sheffield city council was misled over the poll tax. The calculations have caused havoc and will continue to do so. The city council states:
  "The long-term loss of income from grant and business rates will be almost £60 million per year after the Safety net grant is withdrawn. This is equivalent to £160 per year extra on the Poll Tax bill in Sheffield.
  Even in the first year of the new system the Safety Net grant leaves the City Council £13 million worse off in cash terms compared with the last year of the old system. The average household bill will need to increase by around £70 just to cover the loss of income to the City Council.
  The Government has not accepted the representations that the City Council has made over the problems of using out of
  1152
  date information from the Poll Tax Register. This is likely to cost the City Council around £4 million in grant and business rate income in 1990/91."
  All the representations that have been made on care, housing and hospitals have been ignored. The Budget comes at a high cost to our constituents but does not repay them with high wages or with job opportunities. There is no future because, as the Chancellor said, there is a downturn and growth will be slow. The Budget will help people buying and selling shares, but it will be of no help at all to our constituents trying to buy or sell homes. It offers no hope to industry, which has been neglected for years and looks as though it will continue to be neglected. That affects my constituents in Sheffield, which has been devastated by industrial decline over many years.
  We still lack training. The Government have bragged about training, but have not invested in it as they should have done. I recall the Prime Minister saying many years ago, "You can't spend what you haven't got." What we did have 10 years ago was a massive North sea oil asset, but the Government have spent it and have produced nothing for the nation in return. They have spent everything and invested nothing in the future prosperity of the nation.
  Many of our firms, private and public, have tried to help in training, and agencies were set up. But many schemes have failed and many more will fail in the future. The other day I received a letter from South Yorkshire Constellation Ltd.—part of our probation service—which has done a magnificent job in getting a dynamic manager to set up youth training schemes for people in trouble, or in particular need or under threat. Most of the schemes seem to be falling apart, not because of the incompetence of the organisation but because of the Government's lack of enthusiasm and their failure to provide adequate finance.
  Let me read one small part of that letter:
  "There are three other Youth Training Schemes in the city … offering training for youngsters with special training needs and we asked them to co-ordinate discussions regarding some rationalisation, as we knew at least one other was in financial difficulty. The Training Agency took a 'hands oil' view and decided to allow market forces to operate to see who collapsed first. The consequence was that we were the first to collapse."
  We have heard the phrases "market forces" and "hands-off policy" before because that is precisely the policy that the Government have adopted since they came to power, and certainly over the past six years.
  The nation has been badly let down by the Government. They claim to be responsible, but the opposite is the case. But at least there is one consolation: the people of the nation now know.
  5.32 pm
  Mr. Alan Haselhurst: I add my congratulations to those of other right hon. and hon. Members to my right hon. Friend the Chancellor for the way in which he presented his Budget to the House. The Budget was likeable in tone and it will be appreciated quite widely for a good part of its content.
  In this age of particular sensitivity about Members' interests, perhaps I should tell the House that I have a number of connections with industry—notably in the chemical and electronics industries. It is possible that some of my observations will stem from the experience that I have gained with those industries, although it could be

  1153
  said, perhaps more simply, that they will be based on what has been said by industrialists in general and by the CBI in its advice to hon. Members and to the Government.
  The background to the Budget is one of high interest rates, high inflation, a large balance of payments deficit, the widespread unpopularity of the Government and much confusion about exactly what the economic and financial statistics tell us about what is going on in the economy. My right hon. Friend the Chancellor was therefore faced with a particularly daunting task in preparing his Budget this year.
  It is hard to tell how industry is performing. Clearly, some companies and sectors are doing extremely well and are exporting an increasingly large proportion of their output, while others are now in difficulties. In the retail sector, too, there are some signs of depression in the high street, but oher sectors seem to be bearing up remarkably well.
  There was a danger that, if the Chancellor's judgment was not exactly right, Britain could lurch into recession—something which my right hon. Friend wisely sought to prevent. He had two tasks—in the short term, to bolster confidence at home and abroad in his ability to get a grip on inflation and bear down upon the balance of payments deficit and, in the longer term, to strengthen the economy and make it more proof against sudden loss of favour in the markets.
  On the home front, there is absolutely no doubt in the mind of any hon. Member that the Government's anti-inflation policy is hurting many people. People feel pessimistic about the prospects. Their incomes are under severe pressure; there can be no doubt about that. Obviously people would like the load to be eased, but I agree with my right hon. Friend that a quick fix is not the way to achieve that, especially if it would mean the speedy restoration of limits within a matter of months.
  People want to feel that, as we seek to bear down on inflation, our collective burden is being fairly shared. There is unease that some sections of the community are losing badly at present. I therefore welcome my right hon. Friend's announcement that he is to change the capital rules for social security benefits and community charge rebates. That is extremely good news. I also welcome the fact that my right hon. Friend felt able to achieve the full indexation of personal tax allowances this year.
  There is also a suspicion that too much reliance is being placed on interest rates. I concede that it is quite clear that a large proportion of domestic credit is tied up with land and property purchase and, that being the case, I see little alternative to a fairly heavy reliance on interest rates. I am glad, though, that the Chancellor has been prepared to look again at credit controls and has undertaken to monitor the situation.
  I found it interesting that, on Budget day, I should receive through the post from a well-known credit card company the invitation to spend 16·5 per cent. more should I wish to do so. I must emphasise that that is not an invitation to which I shall be responding speedily, but I am sure that it went out to many other people, too.
  It is a question of psychology. Such increases may not add up to a great percentage in terms of the overall national scene but people get a blurred message when they receive invitations to spend more, and that may impede
  1154
  what the Chancellor is trying to do. My right hon. Friend's measures on saving and giving are timely and show greater breadth in his approach to defeating inflation.
  The public are impatient about the pace of improvement in public services. These days, a typical letter of discontent is likely to mention the failure to pay public servants sufficient money, the failure to get on with introducing more measures to protect the environment and the failure to invest in the infrastructure. People also bemoan the fact that insufficient sums are spent on health and education. Those are just some of the matters that typically come up in letters from our constituents.
  Those sentiments would certainly find an echo in the remarks of the. Leader of the Opposition, yesterday and probably at other times. The right hon. Gentleman spoke of an under-invested and debt-ridden economy. He should certainly be listened to seriously, because he can draw on years of Socialist experience of running such an economy. What is the right hon. Gentleman's answer now? It was summed up in the word "partnership". There is no substance to that. It is a user-friendly word, but I cannot help thinking that we could substitute the phrases, "social contract", "national plan" or "technological revolution". We have heard it all before.
  No one seems to understand—least of all the Opposition—that there are limits to growth. Yet all our experience—certainly that of the Opposition—should make us wary about having over-ambitious expectations about growth. My right hon. Friend the Chancellor has been appropriately modest. He estimates that growth will be 1 per cent. this year and 2·75 per cent. next year. That still means an average growth over five years of about 3 per cent., or perhaps slightly more. That is a remarkable record for the British economy in the post-war years. From a growth rate that has any reasonable chance——
  Mr. Martlew: Does the hon. Gentleman agree that a growth rate of 1 per cent. next year will increase unemployment in this country?
  Mr. Haselhurst: Its effect on unemployment remains to be seen. A number of complex factors are at work, but if the figures that my right hon. Friend the Chancellor gave yesterday are fulfilled, the overall average increase will still mean growth of 3 per cent. per annum. The hon. Gentleman should envy that, rather than disparage it.
  If we have a growth rate that is attainable in the first place, and then sustainable, from what can realistically be achieved we shall not be able to generate resources to meet all the demands placed on us at present. We cannot get rid of all the shortcomings in provisions for health, education and the environment within the likely level of growth that could be achieved by any happy combination of policies. However, the Leader of the Opposition seems to imply that that would be possible if a Labour Government were substituted for the Conservative Government. If we are to have sensible discussions of these matters, one of our tasks must be to bring the debate about what needs to be done within reasonable and practicable bounds.
  Those are matters for domestic politics. Further afield, my right hon. Friend the Chancellor has to satisfy world opinion that he has a firm grip on inflation. Perhaps he also has to persuade world opinion that the Conservatives can win the next election, because the alternative seems to worry the markets.

  1155
  The question is, therefore, has my right hon. Friend done enough in his Budget this year? A tax take of £430 million and a projected growth rate of 1 per cent. is surely indicative of a degree of rigour. I debate with my right hon. Friend the Member for Chesham and Amersham (Sir. I. Gilmour) whether a symbolic 1p or more on the standard rate of income tax would have made a great contribution towards easing the burden of interest rates. More than anything else, that might have risked tipping the economy into recession. The right hon. Member for Plymouth, Devonport (Dr. Owen) was probably more nearly right when he said yesterday that the Budget will take a few weeks to settle in before a fair judgment can be made about whether the Chancellor has struck a reasonable balance.
  I agree with my right hon. Friend the Member for Chesham and Amersham that in the longer term we need to strengthen our industrial base. Unit labour costs in manufacturing industry are deteriorating in comparison with those in Germany and France. The annual rate of change in Great Britain is 4·8 per cent., it is 2·2 per cent. in Germany and 0·6 per cent. in France. That spells bad news for the British economy and for our ability to increase our share of world markets. Therefore, we must improve investment still further. Although I do not deride what has been achieved in recent years, and while our private sector investment as a percentage of GDP is comparable with that in France and Germany, we still have a lot of catching up to do.
  I welcome the Chancellor's measures to help small and medium-sized companies. However, he might have done a little more for larger companies. As a percentage of GDP, corporate tax revenue in the United Kingdom has increased from 2 to 3·5 per cent. over the five years 1983 to 1988, which is 50 per cent. higher than in France or Germany.
  If we are to improve our industrial base, we must also do more for training. Therefore, I welcome my right hon. Friend's measures on that. It is a bizarre thought that, with the prospect of a turn in the trend of unemployment, we have too few skills in parts of our economy. Although there will be no shortage of jobs in my constituency or in many other parts of the country in the foreseeable future, there is a question whether those jobs can be filled by people who have the skills to take advantage of them.
  In the longer term, we need the symbolic—but more than symbolic-gesture of joining the exchange rate mechanism of the European monetary system. It is not just whether taking that step would be good for the British economy, because as a country we are now in danger of being left behind in the moves that our European partners will undoubtedly make towards fuller economic monetary union. British business men understand that and the British public probably sense it.
  We are even in the happy position that the Labour Opposition—the lame European ducks of the 1980s—are now in favour of ever-closer European union in the 1990s. However, I suspect that, when the Government take Britain into the exchange rate mechanism, the Opposition will find weasel words to say that the terms are not exactly right. We should replace doubt with determination. We should cease the constant refining of words and conditions. No clearer signal could be given to overseas opinion or to our own industry that we have our priorities right than if we were to set out a firm timetable for entry.
  Overall, my right hon. Friend the Chancellor is maintaining the broad course for recovery, but with some
  1156
  welcome adjustments. My right hon. Friend's Budget could be dubbed a "save and prosper" Budget. I hope that that is how it turns out. I believe that the Budget offers hope that we can pull out of our present difficulties. I trust that my right hon. Friend's judgment and instincts will be borne out by events.
  5.47 pm
  Mr. Tony Worthington: Anyone who wanted to know why the Tory party has done badly in Scotland would have found the answer encapsulated in a single moment yesterday when the Chancellor came to the high point of his Budget. He was giving away goodies, but was confronted not with silence or applause—not that applause is allowed in here—but with uproar from the Opposition because of Scotland. I was sitting opposite the Chancellor, who was totally bemused about the reason for that uproar.
  Like all my hon. Friends, I am absolutely convinced that the right hon. Gentleman had not even thought about the Scottish dimension. He had not realised that it is appalling that when one group of people, who have not yet paid a penny in poll tax, protest about what it will mean to them, they are listened to, whereas another group of people, who have been paying the poll tax for a year, are not listened to. The right hon. Gentleman had not thought about the political consequences of that.
  The Government must find a way of bringing equity into the system. There is a way to do so, because wherever there is the will, there is always a way. I applaud the relief that was given yesterday, but the Government always seem to be listening to only some people. They are listening to people who have savings. They do not listen to those with no savings. They have not listened to the people of Scotland who have paid the poll tax for the past year.
  We must ask about the role of the Secretary of State for Scotland in all this. On Monday, in the Scottish Grand Committee, the Secretary of State told us that the poll tax had been accepted in Scotland and was working well. If hon. Members on either side of the House believe that, and believe that the poll tax problems will disappear, they should forget those thoughts at once. The problems surrounding that tax will rumble on and on. The Government must listen. They must realise that they have backed a loser and that there can be no justice while the tax exists.
  Yesterday's announcement show why the Government's standing in Scotland will worsen beyond its present low ebb. The Prime Minister came to Scotland and in a memorable interview referred to, "We in Scotland," but yesterday's announcement shows how false those words were. It is clear that the Government have not even thought about the consequences of the poll tax in Scotland.
  The Government's action has been unprincipled not only in their neglect of Scotland in terms of the relief given yesterday, but in the implementation of the poll tax. The most striking thing that I read in the past few weeks was a statement by the Tory chairman of Berkshire county council which gives the lie to what the Government are saying about Labour councils. He said that, if he had been given as much money by the Government as Westminster council has, he would have been able to charge a nil poll

  1157
  tax and to give £200 to every citizen in Berkshire. That is the truth behind the way in which the poll tax has been set and the money distributed.
  Mr. Paul Boateng: A damning indictment.
  Mr. Worthington: My hon. Friend is right.
  We should ask the National Audit Office and the Public Accounts Committee whether they can detect any principle behind the way in which the poll tax money is being distributed. There is no justice in the system and, once again, the figures are being fiddled to help the Government's friends.
  I was interested by what the hon. Member for Saffron Walden (Mr. Haselhurst) said about training and its importance, but I am at a loss to see how yesterday's announcement will be of any significant assistance. Someone will receive tax relief on giving a donation to his local technical and enterprise council or, in the case of Scotland, the local enterprise council. Why he should seek to do that rather than invest in training in his own company I do not know.
  The Government have cut expenditure on training. This year in Scotland, comparing like with like, nearly £30 million has been cut from the training budget of the training agencies. Despite that, one can read glossy Government documents saying that the worse time to cut training is in times of hardship. In those documents the Government urge private manufacturing industry not to take a short-term attitude to training. What do the Government do, however, when faced with difficulties? They cut training.
  It is interesting to note the excuse given for that by the Minister responsible for training in Scotland. He told us that the Government have cut expenditure on training in Scotland because of the diminishing client group and the fall in the number of long-term unemployed and young people. We were told that during our deliberations on the Enterprise and New Towns (Scotland) Bill. The same Minister, however, has boasted that there are more people in employment than ever before. Surely that means that the client group is enhanced and that more people need to be trained, some of whom may not yet be in the work force.
  The report on training by the Confederation of British Industry says that we need to take a completely different attitude towards it and to make a quantum leap in terms of training and its quality. It states that the quality of training is manifestly inadequate and that the youth training scheme is still in an embryonic state and needs to be developed. How have the Government responded to the demand for training? They have introduced the employment training scheme. How can one argue that that scheme matches up to and meets the challenges thrown at us by the German, Scandinavian and Japanese training schemes? The motivation behind our scheme is, essentially, to lower unemployment, to reduce wages and to reduce the contribution of local authorities and trade unions to training.
  My right hon. and learned Friend the Member for Monklands, East (Mr. Smith) has made it absolutely clear that, if we are ever to compete effectively in the world, we must tackle skill shortages. In Scotland we have significant
  1158
  unemployment. The city of Glasgow still has male unemployment of 20 per cent., but the city also suffers from skill shortages. The House will appreciate that it is rather difficult to achieve a situation in which firms cannot fill jobs in that city, while male unemployment is still running at 20 per cent.
  The CBI in Scotland has said that skill shortages there are chronic, particularly in engineering. Engineering employers have also revealed how serious the shortage of engineers is at all levels. They are reported as saying:
  "The recruitment shortages of 1989 are evidence that spare capacity is not available".
  Those difficulties are also experienced in information technology. Indeed, there are innumerable areas in which we are experiencing skill shortages, but industry has not picked up the need to rectify that problem.
  In Scotland, as elsewhere, the private sector has been told that the Government want it to take over the training system, but that sector, above all others, has been guilty of not training. We are now told to place our trust in those who have failed us, and that is not good enough. There must be a partnership between private industry and the public sector, and it cannot be left to the private sector alone.
  I was pleased to hear what previous hon. Members said about our manufacturing industry. Am I the only one who felt a sense of shame when I heard the Chancellor bragging about a surplus of manufactured television sets? We have that surplus because the Japanese have come in and rescued us. I am ashamed, because we used to have a television manufacturing industry, but now the Japanese, for their own reasons, have come in and are providing us with that surplus.
  In common with all hon. Members I visit factories, and it is interesting to consider from where the raw materials come. The answer is striking. Recently I visited a British kitchen manufacturer based in the south-east. As I went round the factory I asked where some run-of-the-mill components—certainly not exotic products—came from. I asked from where the blockboard came and was told, from Belgium or Sweden. When I asked why, I was told that Britain does not produce it to the required standard. I asked where the finishes for certain kitchen products came from, and was told Italy. No machine tools used in the manufacture of these products came from Britain. I wondered where the taps came from and found that four out of every five taps in this country are imported. I said to myself that I should be pleased because here is a kitchen manufacturer who is trying to recover the ground that was lost to the Germans and the Italians. However, I wonder if such manufacturers are worsening the balance of payments deficit because what they import is greater than anything that they export. They are not exporting, but simply trying to work in this country.
  I wonder whether the Government have yet realised the problem. Why is it that throughout this century—I accept that this is true of Labour as well as Tory Governments—whenever there is growth, it has to stop? It stops because when the British people get more money in their pockets they do not buy British goods but exhibit a preference for foreign goods. We cannot compensate for those sales by what we sell overseas. I do not understand how, simply by slowing things down for a while, we shall deal with that problem, unless we deal with the problem of the manufacturing base.

  1159
  The Financial Secretary has been promoted this year; I wonder whether he has learnt his lesson from last year. He used to scoff at manufacturing industry and say that we should not exaggerate it.
  Mr. Lilley: Can the hon. Gentleman give any reference in Hansard showing when I did so?
  Mr. Worthington: I cannot do so instantly, but I can turn to the equivalent debate last year.
  Mr. Lilley: In that case, will the hon. Gentleman withdraw the remark?
  Mr. Worthington: No, I shall not withdraw the remark, because I remember that in equivalent debates the Opposition, year after year, have said that manufacturing industry was neglected. The Financial Secretary asked why the Opposition were obsessed with manufacturing industry, and put all the emphasis on service industries and the financial sector. The Government must realise that we shall achieve exports and get rid of the financial deficit only by dealing with the problems of manufacturing industry.
  In the past, the Financial Secretary seemed to align himself with the right hon. Member for Blaby (Mr. Lawson)——
  Mr. Lilley: On a point of order, Mr. Speaker. Is it possible for an hon. Member to continue a complete fabrication when he has admitted that he has no reference to back up anything he says? The hon. Gentleman has not even volunteered to go off and find anything to back up his argument.
  Mr. Speaker: Every hon. Member must take responsibility for what he or she says in this place, provided that it is in order. I have no knowledge of whether what the hon. Gentleman said is inaccurate. I imagine it must be accurate or he would not say it.
  Mr. Lilley: Further to that point of order, Mr. Speaker. That is a slur on me. I have assured the hon. Gentleman and you, Mr. Speaker, that I have never said any such thing. If you would like to join the hon. Gentleman——
  Mr. Speaker: I apologise to the Financial Secretary. He knows that I came into the Chamber two minutes ago and have not heard the arguments.
  Mr. Worthington: I had not noticed you entering the Chamber, Mr. Speaker. I assure you that, as always, I am behaving responsibly.
  In the past, the Financial Secretary seemed to align himself with the previous Chancellor of the Exchequer, who certainly said that the deficit—the excess of imports over exports—about which we are so desperately worried, should not worry us as it would be self-rectifying. It would be interesting to know the present attitude of the Financial Secretary and his senior colleagues to the trade deficit. Has it now become a major problem, or does it remain a hiccup? How can we rectify this deficit unless we start seriously paying attention to the needs of manufacturing industry, particularly research and development and training?
  6.5 pm
  Mr. Nicholas Budgen: The hon. Member for Clydebank and Milngavie (Mr. Worthington) and my right hon. Friend the Member for Chesham and Amersham (Sir I. Gilmour) are agreed on
  1160
  one point—the balance of trade deficit is important. I have the misfortune to disagree with both of them. On that point at least, I agree with my right hon. Friend the Member for Blaby (Mr. Lawson) that the balance of trade deficit will, in the end, be self-correcting.
  In the short time available I wish to make two points. First, I offer strong support to the Chancellor of the Exchequer for having avoided what would have been a substantial mistake. Without doubt, great pressure was exerted on him to make greater concessions, by way of tax relief, to those who borrow on mortgage against housing. It was urged that the £30,000 limit should have been raised to £41,000, or even £60,000.
  It was good that the Chancellor of the Exchequer resisted that pressure. [HON. MEMBERS: "Hear, hear!"] I am heartened by the way in which my hon. Friends show their approval of that remark. There are others in the Conservative party who, misguidely, wish the relief to be extended. If it were, it would simply mean that house prices generally would be driven up and more potential first-time buyers would be priced out of the market. The people who benefited would be those owning development land and, to a lesser extent, builders and those associated with the building industry. I said "to a lesser extent" because it is by no means certain that high land prices alway act to the advantage of builders. That is the case only when they have a large land bank. The Chancellor behaved most responsibly in resisting that pressure.
  Secondly, I shall refer to the Chancellor's overwhelming duty to restrain inflation. He is not entirely to blame for the position in which the country now finds itself. Between 1986 and 1988 the previous Chancellor of the Exchequer grossly over-expanded the economy and allowed the money supply to get out of control. Now, inflation may rise to 9 per cent. and in every aspect of the nation's affairs we can see the disadvantage of an unexpectedly high inflation rate.
  There has been some discussion in the debate about the effect of the community charge. One reason for the extra-large community charges—only one of the reasons—is that the inflation rate is much higher than the Government anticipated when they set out the guidelines for the community charge. Such problems occur in every sphere of the nation's economic activities. This is the one opportunity that the Chancellor has to halt inflation——
  Mr. Ronnie Campbell: Before the election.
  Mr. Budgen: Yes, the one opportunity that this Chancellor has to do so before the election. Everyone knows that he uses two main weapons: monetary policy—in shorthand, interest rates—and fiscal policy—in shorthand, taxes.
  It is all very well to say that it is possible to squeeze inflation out of the system by monetary policy alone—I remember acutely the row when interest rates went up to 15 per cent. I can only assert that I do not think that it would be politically possible to raise interest rates much above the present 15 per cent. The political row that would ensue if, for the sake of argument, interest rates were banged up by another 1 or 2 per cent. at the present time would be enormous.
  If I am right in saying that, then it was necessary in the Budget to raise taxation somewhat. Here I marginally disagree with my right hon. Friend the Member for Chesham and Amersham. He is in favour of an increase in

  1161
  the standard rate; I think that it would have been perfectly adequate not to index the personal allowances. What was necessary, however, was to show some fiscal tightening. Here I disagree with the approach of the Chancellor, who said that he did not wish, on the one hand, to underdo it, but nor did he wish, on the other, to overdo it and run the risk of tipping over into recession. Our society enjoys and encourages inflation. It is rubbish to say that inflation is unpopular. The present Government were very popular indeed when they created inflation between 1986 and 1988. What the British people dislike is the check upon inflation, not its creation.
  What we require now is to run the risk of overdoing it—the risk of underdoing it scarcely ever exists in our society. We should have taken the risk of perhaps raising a bit too much taxation. The result of being unprepared to take the risk of overdoing it is that the last chance before the election may well have been missed. The Chancellor's estimate of inflation in 1991 is that it may be 5 per cent. I hope that he is right, but it must be said that Treasury estimates of future inflation have nearly always proved to be under-estimates. Even if the Chancellor is right, one thing is clear: there is no room for a pre-election boom and reflation based upon a 5 per cent. rate of inflation.
  6.12 pm
  Mr. Robert Litherland: I am pleased that the emphasis in the debate has been placed on manufacturing industry, because, once again, the Budget has miserably failed to tackle the reason for our floundering economy. The Chancellor, like his predecessors, has missed the opportunity to revitalise our manufacturing and industrial base, which has eroded rapidly in the past 10 years in a collapse that has affected some regions more than others.
  For proof, we have only to see the vast tracts of industrial wasteland in the north of England, especially in the north-west, where we have witnessed the evaporation of large labour-intensive manufacturing firms, household names, now gone for ever and with them the hopes of many people still adrift in the sea of unemployment. Job losses in this area from the collapse of manufacturing industry such as light and heavy engineering, textiles and chemicals have been almost double those in the south-east. In spite of the Government's cosmetic statistics, my constituency, where most of the heavy manufacturing and industrial firms were situated, still has 30 per cent. male unemployment.
  The concept of replacing manufacturing industry with service industry is a fallacy. The unemployed recognise far better than the Chancellor that once a manufacturing base disappears it never comes back. It is a myth that the country can sustain a buoyant economy on the back of the service sector—deterioration to an underdeveloped economy is unavoidable without a strong manufacturing base. The service industries in my constituency that once provided the requirements of the manufacturers have now become obsolete because there are no longer firms who need their services.
  These jobs have to be replaced with less essential, low-paid, part-time jobs such as hotel work, fast food shops and employment in pubs and bars. All these try to fill a void, but they fail to solve the problem. The service
  1162
  industry has failed to offset manufacturing job losses. The Greater Manchester low pay unit has recently produced a report that emphasises that service industries are not a panacea for all the economic ills in our area. Miss Gabrielle Cox, the author of the report and the unit's project co-ordinator, said:
  "Our whole economy in this region is under threat. Over the past decade there has been a massive reduction in the number of employed. Higher paid production and construction jobs have fallen by 30 per cent. Opportunities in service jobs have increased by 5 per cent., but often these are very lowly paid. We cannot rely on tourism to revive our local economy. That is not a viable tactic for survival. This region must be more than a museum of our glorious industrial past. What we need is an industrial future. There is an urgent need for significant investment in new industries and technologies."
  The Budget has once again failed to tackle the long-term problems of the economy—no new measures to regenerate manufacturing industry and no real capital investment.
  I will say this, however: in all the Budgets that I have experienced since I became a Member in 1979, the biggest beneficiaries have always been the wealthy, with gains from tax concessions on their investments, on stock exchange deals or on their inheritance. The losers are always the poor and unemployed. Tax changes to these people are meaningless. They are the people who have meagre incomes and little prospect of employment.
  It adds insult to injury when the very services that these people need—services that are essential to the needy, the public services—have been drastically cut. This exposes another myth. Chancellors always insist that to provide public services, taxpayers have to dig deep in their pockets. What Chancellors always fail to mention is that, in order to provide the massive tax handouts to the rich, public expenditure on essential services for the poor has to be cut. As public sector services have declined, so, once again, the deprived in our society have been hit the hardest. If one ever has to switch from public spending to private pockets, someone gets hurt—and in every instance it is someone who can least afford the burden.
  Mr. Michael Jack rose——
  Mr. Litherland: I am sorry, but my time is limited and others want to speak.
  The Budget does nothing for the poor. It makes a mockery of individuals and families who struggle day by day to exist, the elderly, the homeless and families who have the spectre of the poll tax looming. If it is said that we cannot spend what we cannot afford, it is equally true that these people cannot save what they have not got. Those people also suffered during the so-called 1988 economic miracle.
  To call this the savers' Budget is insulting to the majority of my constituents, because saving always assumes that people have money to spare. So far is that from reality that many must borrow to make ends meet. The loan sharks thrive in inner-city areas. The Budget is without hope and without vision, and once again it appeases the wealthy in society. If, after 11 years in government, this is the best that the Government can do, they are an abject failure. The sooner we boot them out and replace them with a Labour Government, the better.
  6.20 pm
  Mr. Andrew MacKay: I commend my right hon. Friend's Budget, particularly because it is such a good Budget for savers.
  I was disappointed when the hon. Member for Clydebank and Milngavie (Mr. Worthington) said that through the community charge rebates the Government were helping only those with plenty of savings and not the genuinely poor. He completely fails to understand that pensioners with no other income are already receiving substantial rebates up to a maximum of 80 per cent. Those who are suffering or are likely to suffer because of the community charge are those who have saved a nest egg and are not eligible for a rebate. There has been a major disincentive to save which has aggravated many people. That needs to be re-emphasised because it was not sufficiently picked up by the newspapers following yesterday's Budget statement.
  My main concern is for people who have never earned much money, but who have been thrifty and each week or month saved a little so that they have a nest egg of about £8,000 or £12,000 for a couple, for their old age. Throughout their working lives they may have lived next door to a couple who have chosen a different route and spent the money that they earned. Some would describe such a couple as feckless.
  Mr. Martlew: Will the hon. Gentleman give way?
  Mr. MacKay: No, we have only 10 minutes for our speeches.
  For those who have saved, it is adding insult to injury to see their neighbours getting an 80 per cent. rebate on housing benefit, council rents and community charge. They can ill afford to pay the full community charge and find difficulty paying the full rent. The Chancellor of the Exchequer is to be commended for doubling the savings limit from £8,000 to £16,000.
  People who live together and are not married will not now be disadvantaged. All hon. Members will have come across this further anomaly. A husband and wife who have saved a little more that £8,000 may live next door to another elderly couple, perhaps a widow and widower who are brother and sister, who, obviously, are not married and are not eligible for a rebate on their community charge. That was patently unfair. My right hon. Friend has erred on the generous side by raising the individual savings limit to £16,000. I imagine that he did so because if he raised it to £8,000 per individual, a millionaire pensioner could move all his savings from his wife, who would than receive an 80 per cent. rebate on the community charge. That would he disgraceful—some would describe it as obscene—and it certainly was not intended.
  I am worried about a further group and I hope that my hon. Friend the Minister will take note for the future. Counties such as Berkshire have suffered from an unrealistic standard spending assessment which I hope can be corrected, although we may have to debate that another time. I am worried for my constituents who earn just above the level at which they would receive family credit or income support and who have wives who look after the children and therefore cannot work. Incidentally, any young mother in the Thames valley who wants to work will be able to find a job because we have negative
  1164
  unemployment and because of the help that my right hon. Friend has provided by scrapping the benefit in kind tax on workplace nurseries.
  The families that I have referred to will find it extremely difficult to pay the community charge. Those couples need help in the form of rebates, similar to that which pensioners have received. I hope that my hon. Friend the Minister will bear that in mind when he considers further changes in rebates.
  My hon. Friend may ask how I would pay for that and I have a suggestion. It is unwise to ask the Treasury for extra money without explaining where it will come from. I must be somewhat critical of my right hon. Friend the Chancellor because the increased duty of 10p on 20 cigarettes is insufficient. If we are serious about preventive medicine and health care, we should provide major disincentives to smoking. I should have liked a 20p increase on cigarettes. I suspect that there is only one reason why the Chancellor did not do that and that is because it would have had a remarkable effect on the RPI and therefore on inflation.
  As all hon. Members strongly oppose encouraging young people to start smoking and support preventive medicine, perhaps we can agree across across the Floor of the House that the best way to reduce the long-term cost to the NHS is to take tobacco and cigarettes out of the RPI. Incidentally, I should also like to see mortgage repayments taken out of the RPI, but Labour Members—[Interruption.]—as the hon. Member for Blyth Valley (Mr. Campbell) characteristically points out, would yell "Sham" and "Fix". I would not necessarily expect all-party support on that. I hope that if my hon. Friend the Minister were assured of all-party support to remove the cost of cigarettes and tobacco from the RPI, he would undertake to consider it seriously. It would be in the interests of health care and would make a great deal of sense.
  The provision on workplace nurseries will help my constituents, but I should like to nudge my right hon. Friend to go a little further next year. I have already pointed out that the lack of benefit-in-kind charges on workplace nurseries will be of great help to many young mothers who wish to return to work and to employers who have skills shortages, especially those in the Thames valley, but let us be absolutely honest about this: there are not many workplace nurseries in my constituency, and I can see hon. Members on both sides nodding in agreement. There are few.
  I hope that the concession in the Budget will increase the number of workplace nurseries, but I fear that it will increase them only among large employers. I imagine that large firms in my constituency who complain that they cannot find people for vital jobs will invest in one, but small firms cannot. If we are realistic, we must concede that the great majority of employees will not find a job in a firm with a workplace nursery. Instead, they will pay for the child to be cared for, either in an ordinary nursery or by a child minder.
  If we are serious about giving an even break to young mothers who want to return to work—the Chancellor was right to say that we should not be in favour or against mothers going back to work; in a free society, it is for them to decide, but we must end barriers that prevent them from returning to work—if we are serious about improving skill shortages and if we are serious about finding people to

  1165
  take up jobs where there are vacancies that cannot be filled from the existing work force, as is happening now in the Thames valley, we must do more.
  A good start has been made. As the next step, mothers should be given tax relief or partial relief on the expenses that they incur in placing their children in nurseries or paying child minders.
  Mrs. Fyfe rose——
  Mr. MacKay: I am running out of time, so I cannot give way.
  It is clear that workplace nurseries cannot be established at every place of work. I commend the Budget, which is sound. I hope that the next Budget will take into account my mild criticisms and will cater for all the requests that I have made.
  6.30 pm
  Mr. William Ross: I watched the Chancellor's performance yesterday with some fascination. He was brilliant and he is to be congratulated on his performance. I am sorry that he is not in his place to hear me say that. On the other hand, perhaps it is as well that he is not, because it was a brilliant performance in trying to make a silk purse out of a sow's ear.
  The situation in the economy is grim. The Chancellor was dealt a poor hand and, although he handled it superbly and sold his and the Government's case to the country well, the underlying problems will remain for some time. To give credit where credit is due, he tried to place the few goodies that he had to distribute with those in the greatest need. On behalf of the Ulster Unionist party, I welcome the help for charities, inheritance and capital gains tax indexation, the disappearance of composite tax, the introduction of tax-exempt special savings accounts and the changes in VAT.
  The tax allowances for blind people are especially to be welcomed, and I hope that, having dealt in that way with that group of the disabled, the Government will go further and consider other disablements. I hope that they will look with particular care at the needs of blind students, because the special equipment that they require imposes extra costs on them. They have fewer job prospects at the end of their training and education and they will experience considerable difficulty over the student loans scheme. That issue must be examined with care and in detail.
  We on this Bench welcome the social security changes. I listened with interest today to the hullabaloo that arose during the speech of the right hon. and learned Member for Monklands, East (Mr. Smith), who claimed that the Government had forgotten Scotland. Those who accuse the Chancellor of that seem to forget about the one part of the kingdom where rates are still the norm for local government finance. In Northern Ireland there is no poll tax, or community charge, or whatever it may be called. We have not yet had spelled out to us what the effect of that change will be on the ratepayers of Northern Ireland. I hope that before the end of the debate we shall be given a clear understanding of that.
  I was glad to see independent tax for women finally coming into operation, although that change was prophesied last year. That procedure has been followed in a number of other goodies this year; we were told that they
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  would be coming next year or, in the case of TAURUS, at some future time, perhaps never. As I do not invest much in the stock exchange, never having had that sort of money, it will not affect me. Indeed, that goodie will not feature much in the eyes of the general public.
  I welcome the Government's commitment to the further repayment of central Government debt, and I particularly welcome the fact that there has been no wild rush to European monetary union, because on this Bench we have not shifted much in our opposition to the Common Market and all its works. As for the desire of the farmers' union to enter EMU, let us remember that that union advised farmers to vote for entry into the Common Market years ago. I thought that that decision was wrong then, it was proved later to be wrong, and the farmers' union did not get all the benefits for the farming community that were sought. I have no doubt that the union is wrong again now. We cannot hide away from the blasting winter gales that the economy of this country faces, either in EMU or anywhere else. We must get out there, manufacture, sell and earn our own living in the world.
  I object to the petrol and diesel tax increase. Hon. Members will not be surprised to hear that, because I represent a largely rural community where a car is a necessity and not a luxury. Nor does the tobacco tax increase meet with general approval on this Bench, since many jobs in Northern Ireland depend on the tobacco industry.
  I regret that further help has not been announced for investment by manufacturing industry. The hon. Members for Manchester, Central (Mr. Litherland) and for Clydebank and Milngavie (Mr. Worthington) dealt with that issue at length. We need manufacturing industry. The hon. Member for Clydebank and Milngavie described what was in effect an assembly line rather than a manufacturing line in the sense that so much of the basic and high-value materials used were imported. We should be trying to manufacture more of those items at home, for the basis of this country's wealth is manufacturing industry.
  More help should be given to inventors, many of whom are individuals rather than organisations. They have problems in financing their inventions through to the market place. They have difficulty with patent costs, achieving production, money flow, obtaining grants, and so on. Their difficulties in Northern Ireland are especially great because of the effects of terrorism. I hope that the Government will take further interest in that matter.
  The Chancellor did not have many goodies to distribute. One could say that he had a few Polo mints to dispense. An outstanding characteristic of Polo mints is that they have a hole in the middle. Much of the Budget is like that, because it is designed to paper over some cracks.
  I was concerned whenever the Chancellor spoke about a strong pound. I was wondering what that was and came to the conclusion that it was a pound that would retain its value against the currencies of the other major industrial economies with which we are in competition. The pound would not need support from the Bank of England—it needed it today—and could float successfully, and I am left wondering what has happened to the whole concept of a floating pound. Is the pound at present floating?
  There are many other matters to which I wish I had time to refer. The Chancellor has been described as a one-club man in that it is said that he has only interest

  1167
  rates to use. There are other things that he could use, such as income tax rates and action on public expenditure. Does he believe that the minimal steps that he has taken will be sufficient to correct the problems of the economy? Is it his perception that private expenditure is going down fast and far enough to bring down inflation? Why has he ignored public expenditure if he really wants to squeeze out inflation?
  While we hear much about local government spending, no attempt has been made to decrease central Government spending, which, we were told on 15 November, would rise from £168 billion this year to £203 billion in 1992–93, a small increase of £35 billion. That increase, of nearly 21 per cent., concerned me at the time and my concern has not lessened in the intervening weeks.
  The last time that the Government started to squeeze out inflation, in 1981, they allowed inflation to run at roughly 5 per cent. for years in order to cushion those who had bought ahead of themselves in the expectation that inflation would roar ahead. I wonder whether there is the same carry-on today. If so, I strongly advise the Government against it. Inflation is an evil hydra which needs to be crushed out of existence and kept out of existence. That will not be achieved simply, easily or painlessly.
  The Chancellor's judgment may well have been coloured by electoral prospects. If his judgment is right and inflation comes down, victory will flow from the measures that he announced yesterday. If he is wrong, he will curse the day that he did not follow more closely the example that Brazil set him only the day before.
  6.40 pm
  Mr. Robert Boscawen: No one will disagree with the hon. Member for Londonderry, East (Mr. Ross) that inflation is a monster and must be crushed out of existence. I whole-heartedly agree, and I am delighted that my right hon. Friend the Chancellor put that objective at the head of his opening remarks in his Budget yesterday when he said that he would use every method to bear down on inflation.
  As is usual these days, and has been for as long as I can remember, when we have had a Budget the financial pundits race to their microphones to give long-term guesstimates of what the Budget will do, and one guess proves as indifferent as another But it is usually many months before we see the results of the measures announced by the Chancellor.
  I can say unreservedly that the Chancellor's performance in the presentation of his Budget yesterday was exceptionally skilled. He had few cards to play, but he appeared to play them effectively. Few Chancellors in recent years have had such a poor hand before coming to the Dispatch Box. I am grateful for the talents that my right hon. Friend displayed.
  I am amazed how many commentators have been calling for an easier time, particularly on interest rates. They have called for interest rates to come down and for the Chancellor to take risks with inflation so as to ease the pressures on family budgets, on medium and small firms and on farmers, of whom I have many in my constituency. Farmers have been among the first to call for the easing of pressure on interest rates.
  Many people seem to have forgotten how the effect of inflation soon turns up in high unemployment. Thank
  1168
  goodness, my constituency has low unemployment—about 4 per cent. The hon. Member for Clydebank arid Milngavie (Mr. Worthington) said that, sadly, in some places in his constituency it was 20 per cent. Such differences in unemployment have been the most persistent long-term problem during my adult life. There may be rising inflation in one area and unacceptably high unemployment in another.
  No Government, certainly since the war and before the war—it was worse before the war—have been able to overcome the discrepancies in Britain's labour markets. Easing up on inflation in the more prosperous areas will do nothing but harm to areas such the one that as the hon. Gentleman represents. My right hon. Friend the Chancellor has no alternative but to persist in bearing down heavily on inflation in the quickest and most direct way by raising the price of money.
  In most of Britain there has been great improvement in unemployment, and that is welcome. Above all, we must keep it that way. Having a job to go to, a career to follow and a lifetime in a particular calling is the most important benefit that young people can ask for and that we can give them. The short-term effect of interest rates on mortgages, family incomes, and so on, can be lived with, but if we let inflation get out of hand, the unemployment that would follow would do immense harm to the Government and even more harm to our young people.
  It is also of great importance that my right hon. Friend tackled the problem of savings in the Budget. There are no prizes for anyone who guesses why savings have been virtually completely squeezed out from people's normal habits. There were the huge inflation rates of the 1970s. the ludicrous tax-and-tax-again policies on savings of the Labour Government, and the ridiculous measures that were taken against savings for administrative reasons, such as the composite rate tax, which should have gone long ago. My right hon. Friend was right to try his best once again to encourage the ethos of saving in Britain. Saving is so much better than taxation. I hope that the Opposition will put behind them all the ideas about those who saved too much being parasites on society.
  My right hon. Friend has made some excellent suggestions for overcoming some of the anti-saving devices of the past, and he has done a great service to the small saver with his new scheme for saving relatively small sums of money provided that the savings are held for 10 years. I hope that his new-found friend TESSA will be a popular girl. I have already mentioned the composite rate, and the ending of that is good news for those whose incomes are too low to pay tax.
  Too many people come to my surgeries and say that when they were young it was impossible to save. That was true in many cases. This year my right hon. Friend has made a good start in trying to revert that trend, as his predecessor did with his personal pension plan. I see my right hon. Friend the Chief Secretary to the Treasury in his place. He should ensure that the rats in the Inland Revenue do not get at the new schemes in the same way as they did to the personal equity plan scheme which they made so difficult and so complicated that it was hardly taken up to begin with. They are getting it better now, but will my right hon. Friend do what he can to ensure that the rats do riot get at it and the good intentions are not lost? I hope that people will say that the 1990s were a good time to save and so to acquire the sense of independence that adds so much to the character of any society.

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  I commend the Chancellor's Budget to the House, and I give it my full support.
  6.50 pm
  Mr. Ronnie Campbell: This Budget seems to be that of a Government in their death throes. There was nothing for anyone, other than those with a few pounds to save. There must be one in a thousand who are not paying poll tax, or who are paying high interest charges and have any savings left.
  The Chancellor made it plain that he intended to raise interest rates this year, if need be by 2 per cent. That is an indictment in itself. Obviously, by the end of the year, the interest rate will be about 2 per cent. higher than it is now.
  Let me say to my right hon. and learned Friend the Member for Monklands, East (Mr. Smith) that a Labour Government will inherit that problem and have to put it right. The Government are making such a mess of things that it will be one big black hole by the time the Labour party gets into power. The Conservatives will lose the by-election on Thursday, and they will lose the next general election. There is no way that the Government can regain the initiative, and a Budget like this will not help.
  As a result of the Budget, more people will be means-tested. Some 5,000 will be drawn back into income support; 1·2 million will be brought into housing benefit; 85,000 people will be brought into tax who did not pay it before. The Government try to say that they are taking people out of taxation, but this Budget brings them in. The Government constantly say that they are the party that does away with taxes, or reduces income tax. However, since 1979 the tax burden has shifted from income tax to national insurance, value added tax and indirect taxation. People are being hoodwinked: the taxes that they were paying under the last Labour Government were no different from those that they are paying under this Government. The only difference is that they are not included in direct taxation.
  Those earning £157 per week are now on the low-pay threshold. Some Conservative Members might think that that is a lot of money; they might be lucky enough to get it in their tax rebate. However, some families earn that amount in a week. People on that wage will lose £10 a week. In the north-east of England, there are many people on low wages, and £157 is considered to be a low wage.
  Poverty has been continually growing in this country since the Government took office in 1979: 9·4 million more people are now believed to be living on or below the poverty line, and 2·25 million of them are children. There was no charity or giveaway for the people on low wages and income support in the last Budget or the one before that—the "giveaway Budget." Since coming to power, the Government have done absolutely nothing for the poor. The official poverty line has increased by 55 per cent. which is another indictment of the Government. Since 1979, some 100,000 families have lost their homes; mortgage payments have risen; and repossessions have increased by 800 per cent. Yesterday the Chancellor said that interest charges will increase even more, which will mean that even more people will lose their homes.
  Before I left my office for London on Monday, I saw two families with housing difficulties—they could not afford their mortgage payments. I could do little for them,
  1170
  apart from telling them that they must present themselves as a homeless family. It is another indictment of the Goverment that so many people must lose their homes.
  In January, a parliamentary question asked how many people would benefit if capital loans were abolished. The DHSS said that it would affect only 166,500 people, but the Chancellor suggested that 225,000 people would gain. I do not know who is right, the DHSS or the Chancellor. Perhaps someone can answer that question later. Even if the Chancellor is right, and the figure is 225,000, only 0·8 per cent will gain. We could abolish it altogether and, according to the estimates, it would cost only £136 million.
  It would have been better for the Chancellor to throw the capital loans out altogether, thereby saving on administration, and so give the local authorities at least a chance. The local authorities have had a hell of a job to get the poll tax and the rebates off the ground. Everybody believes that he is entitled to a rebate. What is not realised is that, even with a rebate, everybody will have to pay at least 20 per cent. of the poll tax.
  What does this Budget do for pensioners who do not have loads of money? For those who do have loads of money, there are some fancy savings schemes, but what about the others? We hear constantly about what a good Government we have. Some people would try to make us believe that things have been wonderful since 1979. But in that 10-year period the income of pensioners has been cut. The Government have removed the earnings link and, as a result, single people have lost £12 a week and married couples £19 a week. In this way the Government have saved £4 billion——
  Madam Deputy Speaker (Miss Betty Boothroyd): Order. The hon. Gentleman has had his 10 minutes.
  Mr. Campbell: I will now wind up.
  Madam Deputy Speaker: Order. I am afraid that, as the hon. Gentleman has had his 10 minutes, I cannot allow him to wind up. Sorry—another time.
  7 pm
  Mr. John Townend: I think that most people agree that the Chancellor, in presenting his first Budget, faced a daunting task. I congratulate my right hon. Friend not only on his presentation of the Budget in the House but on his excellent performance on television last night.
  With the retail prices index still rising—albeit as a result of technical factors rather than the underlying rate of inflation—my right hon. Friend clearly had little room for manoeuvre this year. The Budget judgment this year is critical for the Government. I believe that, if the Chancellor has got it wrong, we can say goodbye to the next general election. He had to satisfy the market by continuing a tight fiscal stance—possibly even tighter than before—but he had to avoid being too tough, as that would have pushed the economy into severe recession. As a result of being boxed in, he was faced with the prospect of presenting a very boring and dull first Budget. I am delighted that that has not happened. We have had an innovative Budget with some imaginative ideas.
  In particular, the Chancellor, at long last, has tackled the United Kingdom's major problem—the decline of thrift. As to the overall judgment, the Chancellor has opted for a marginally tighter fiscal stance, taking out just under £0·5 billion extra in taxation this year. Clearly this

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  will not put us into a recession. Only time will tell whether it is sufficient, but I think that, on balance, my right hon. Friend has got it right. The initial reaction of the markets today and last night was that the Budget should have been tougher, but markets often react rather nervously after a Budget, and I am afraid that a number of the financial scribblers have been trying to talk down the market and the pound.
  This week we shall get another set of balance of payments figures and another set of retail sales figures. I feel that, after last month's blip, these will be more favourable, and, as a result, the pound could rally. However, it would be foolish not to appreciate that the next few months will be critical. If we can get to the autumn without having to raise interest rates again, we will be through to clear water. Inflation will start to come down, and the Budget will be seen as a triumph for the Chancellor.
  I want to turn now to the effect of the Budget on small businesses. In Committee on the last Finance Bill, my hon. Friend the Member for Dover (Mr. Shaw) and I pressed the Treasury Ministers to increase from £500,000 to £750,000 the limit on the amount that BES trading companies may raise. We are absolutely delighted that the Chancellor has done so this year. We hope that during the passage of this year's Finance Bill he will accede to our other two suggestions regarding BES schemes, by reducing the limit from five years to three years and by allowing salaries for investor directors.
  We welcome the changes in VAT regulations, which will enable businesses to reclaim VAT on bad debts much earlier. We welcome also the increase in the VAT threshold and the simplification of the rules for traders. The fact that VAT registration will now be based on a simple rule—the previous year's turnover—will mean that small businesses may register later and make some cash savings.
  In the case of corporation tax, the increase of £50,000 in the limit for the small companies rate will be welcomed by medium-sized businesses but will not help small businesses that make a profit of less than £150,000. I strongly urge the Government to consider allowing the first £5,000 to £10,000 profit of small companies paying the small rate of corporation tax to be tax-free so long as the profit is retained in the company. This would be of very great help to young companies, which are often desperate for capital once they have become established and start to expand.
  There is another concession that I should like the Government to consider giving to small businesses. It concerns inheritance tax. I think that the principle has been accepted that it is of no benefit to the country that successful small businesses should have to be sold in order to pay inheritance tax. Even if such businesses do not have to be sold, substantial sums of capital have to be provided to pay inheritance tax when the entrepreneur dies. I know that it is now easier to give shares away, but that is not always practicable. Indeed, sometimes people die out of turn. My suggestion is that inheritance tax on the shares in a private company should be rolled over until those shares are sold or until the company goes public.
  As many right hon. and hon. Members have said, one of the problems in our economy in recent years has been the propensity of the British to save less and to spend more than the people of other industrialised countries. One of the reasons for this is the previous economic success of this Government. People have been more prosperous and have
  1172
  felt more secure under this Government, and therefore have not felt it necessary to save. They thought that they could spend their money as they earned it. It is vital that that trend be reversed. A Budget for savers was absolutely essential, and that is what we have got. In this respect, the Chancellor has performed brilliantly by encouraging new savings and by removing impediments to saving.
  The tax-exempt special savings account—TESSA—is particularly welcome. This is a simple, unsophisticated brother—or sister—to PEP. PEP encourages investors. The increase of 25 per cent. in the annual limit is welcome, but PEP does nothing at all for the saver who does not want to take any risks. TESSA fills the gap, and that is very important. It is very simple. It will be easily understood by everybody, and will be readily available to every saver in the land. I believe that, over the years, it will have an enormous effect on efforts to bring thrift back into fashion.
  The Chancellor has dealt with a number of impediments to saving. I welcome the abolition of the composite tax rate, which was long overdue. This not only is a bonus to savers on low income but removes a clear injustice. In my own mind, I could never justify low-income savers not liable to tax having to pay tax merely for administrative convenience. This change will help many pensioners and married women in my constituency.
  The abolition of stamp duty on securities not only removes an unnecessary investment cost but will improve the competitive position of the City of London and give it a tremendous boost to become the securities centre of Europe.
  One of the greatest impediments to saving has always been the belief that, if one saves for one's old age, one will lose all the benefits that are available to those who have been less prudent. With the introduction of the community charge, this problem has been brought home to all hon. Members. Like many of my colleagues, I have been pressing the Government to increase the £8,000 capital limit per couple to £8,000 per person, making it £16,000 for the couple. I am delighted that, although the Chancellor has not accepted that suggestion, he has doubled the limit for a couple to £16,000, thus achieving basically the same result. That shows that we have in No. 11 a Chancellor of the Exchequer who listens to Members of Parliament.
  However, I ask him to take no notice of the Scots. The concession should not be retrospective. It applies to housing benefit as well as to the community charge. To be retrospective, it would have to cover England, Wales and Scotland. The administrative problems would be enormous. It would set a dangerous precedent. Retrospective tax changes, whether they increase or reduce taxation, can be dangerous.
  I agree with the Chancellor that credit controls are impracticable. However, many people are upset with the banks and other financial institutions for having thrust credit on people. Many of them cannot afford it. It is especially objectionable when circulars arrive for 16 or 17-year-olds. I am delighted that the Chancellor said that from now on he will use his influence, and that he will get the Bank of England to use its influence. Influence can work.
  The Chancellor has made a brilliant start. It was a Budget for women, savers, small businesses, the blind and football. I support it whole-heartedly.
  7.10 pm
  Mr. Eric Martlew: I should like to put the Budget in the context of the real world—not the world of the stockbroker who is delighted that stamp duty has been removed from share dealings, or the world of the multi-millionaire who, on a whim, may give £5 million to charity. I want to put it in the context of the people who come to see me in my surgery every week. They are worried about the bills that drop through their letter boxes—the increasing size of the electricity, water and gas bills, and now the poll tax. Then there is the letter from the building society. In the last two years they have had seven, or perhaps eight, such letters. My authority is Labour controlled. The poll tax will be £365. If the Conservatives had been in control, it would have been £350. The amount would not have been all that much different, but if the Conservatives were in control there would be some nasty cuts.
  In a typical family, the husband works full-time. He is a skilled worker. His wife works part-time. They have two children and they live in a semi-detached house. They left the Labour party in 1979 and voted Conservative and they have returned the Conservatives to power ever since. If they had come to me last Saturday, I should have said, "Don't worry; the Chancellor will help you next week. He will solve the economic problems and give you the help you need. That's why you voted Conservative last time. He's supposed to help people like you."
  If they come to see me next weekend, what shall I say to them? Will I say, "You're lucky, as top rate taxpayers; your tax rate has not been increased"? A typical family earning £16,000 a year is never likely to pay the top rate of income tax. Will I tell them that they are lucky not to have a company car and that therefore they will not have to pay the extra 20 per cent? Will I say to them, "With independent taxation you will have two capital gains tax exemptions of £5,000 each, so you can sell one of your valuable assets and realise a tax-free profit of £10,000"? But their only asset which is worth over £10,000 is their home, which they may have to sell because of increased mortgage repayments. But in any case their house is exempt from capital gains tax. So they will not be very happy if I tell them that.
  I could say to them, "Why don't you look on the bright side? Think of all the benefits you will get as a saver. You'll be able to open your own TESSA account. You'll be able to invest £150 a month for five years and the interest will be tax-free." I can imagine the reply: "For the last two years we've been unable to save anything. In fact, we've had to take out a second mortgage to make ends meet." It would be useless to tell them that they can increase the amount that they invest in a personal equity plan from £4,800 to £6,000 a year. I know what they would say about that.
  I could say, "The answer to all your problems is that the composite rate tax on savings has been abolished," but I am sure that that would not help them. I could say to them, "The Chancellor abolished stamp duty on share dealings, didn't he? That will help you." They would say, "Yes, we used to have some shares in British Gas but we had to sell them six months ago to pay the gas bill." I could also say, "You'll get tax relief on workplace nurseries." Their answer would be, "That's all very fine, but there are no workplace nurseries." Mrs. Typical is not too keen on workplace nurseries. They are an extension of the tied
  1174
  cottage principle—once in, one cannot get out. The only employers with workplace nurseries are banks. Few of my constituents work in banks.
  The only Budget change that the typical family can see that will help them relates to charities. The husband is thinking of having his children registered as charities so that they can go begging round stately homes and board rooms for money.
  The typical family will suffer as a result of the Budget. Duty on cigarettes and petrol is to be increased. That will increase inflation. The Chancellor has predicted a 1 per cent. growth in the economy. That will mean unemployment. Mr. Typical could soon be out of a job because of the Budget. If we accept that industrial productivity must grow by at least 4 per cent., growth at only I per cent. means that three out of every 100 employees will be made redundant next year. This is a Budget for unemployment.
  My constituents are typical of many others throughout the country, from Finchley to Mid-Staffordshire. The Budget has been billed as a Budget for savers. It will do little to encourage spenders to become savers. It will only benefit existing savers. Disposable income will be eroded by high interest rates, inflation will continue, the rich will become richer, and the poor will pay for it.
  To anyone who has been prepared to listen to him, the Chancellor has said, "Don't panic." It reminded me of a television series: we have a shell-shocked Chancellor in a "Dad's Army" Government. The sooner they surrender the better it will be for Britain.
  7.17 pm
  Mr. Julian Critchley: To speak in the House of Commons, even on a subject as important as the Budget, between 7 and 8 o'clock is like appearing on Sky Television. Sooner or later, one has the nasty feeling that one is all alone.
  I do not wish to exaggerate. We are lucky enough to have a distinguished junior Minister, somnolent but assiduous, in his place—and a young man in the Whips Office who is paid to attend and who has upon his knee a chart on which he writes down his opinion as to the speakers on this side of the House. Phrases such as "sound" or "very satisfactory" are the ones that come to mind. Even the political correspondents are drinking their proprietors' champagne. Only the Wykehamists in the Treasury, whose task it is to sustain our masters in argument, are prepared to stay on. I can only say that, as a Back Bencher of very long standing, I can remember the time when my right hon. Friend the Prime Minister was a brunette. I can also remember when Lord St. John Stevas was a Protestant.
  It is an awkward time for a loyal Tory Back Bencher to be on his feet, sandwiched between the harshest Budget since 1981—remember the halcyon days of 1981?—and the Mid-Staffordshire by-election tomorrow. It is a position of some discomfort, so I shall tread with great care.
  After 11 glorious years, we are looking at the next election and there are three possible scenarios. First, it could be rather like 1970, when we snatched victory from the jaws of defeat and were returned with a reduced majority—clearly that is the aim and ambition of all Conservatives. The second option is another 1964 when the Labour party sneaked back with a majority of three, and sometimes six, votes. We must remember that in 1964 the Conservative Government enjoyed the same majority

  1175
  as we do today. The third alternative, which hardly bears thinking about, is a repeat of 1945, which could conceivably happen after a period of 11, 12 or 13 years. Clearly Conservatives must aim for a repeat of 1970.
  I watched yesterday's Budget upstairs in my office on a very small black-and-white television set made in Japan. I thought that, perhaps because of the cameras, everyone was marvellously well behaved. It was a bit like being at divine service, until towards the end the Scots became rather agitated. But I am told that in Scotland they do that sort of thing in divine service; they are encouraged to participate in a way that does not happen south of the border.
  I wonder whether my right hon. Friend the Chancellor, who made a good impression. might not have fallen between two stools—one being that the aim and objective of Government policy ought to be to overcome inflation and thus maintain the exchange rate, and the other being to restore the morale of Conservative Members. I noticed that, after his performance yesterday, there was a spring in our step and more bottles were opened last night at dinner than for some time.
  However, there is a contradiction between those two objectives. Clearly one must hope that my right hon. Friend the Chancellor has achieved both, but the prospect for 1990–91 is not a cheerful one, with a 1 per cent. increase in growth, interest rates at 15 per cent. and wage rates at 9·5 per cent. or more which must mean an increase in unemployment. If inflation is still at its current rate this time next year, we shall be denied an election-winning Budget. How many Governments in the past, of all political complexions, have relied on the cyclical manipulation of the economy to achieve the return of their own political party?
  It dawns on me that people are most prosperous in the year before an election. As elections take place only every five years, if we were to reduce the time between them and hold them every three years, surely we would be able to enjoy wider prosperity.
  In the three and a half minutes that I have left to speak, I shall revert to the morale of the Conservative party. I voted against the poll tax. That gives me little comfort and my constituents no consolation whatsoever, so I resist the temptation of saying, "I told you so." I am not against obliging the working class to pay for local government, but there should have been a more sensitive relationship between a person's ability to pay and the size of the tax.
  Between now and next year, my right hon. Friends the Secretary of State for the Environment and the Chancellor must get together to oblige the Prime Minister to inject into local government spending an additional £4 billion, so that next year the poll tax is brought down to more manageable levels. They must make the Prime Minister an offer that she cannot refuse. Unless that demand is met, I see very gloomy prospects for the Conservative party being returned to office.
  Finally, the Tory party is threatened with a running leadership campaign. We have a superfluity of contenders, one of whom, if he is ever elected to Downing street, has promised to make me the last governor of the Falkland Islands. Might it not be wiser if the Tory party, meeting upstairs in Committee Room 14 on a Thursday evening—the longest running show on earth—instead of altering the rules of election for our leadership, as was threatend by my hon. Friend the Member for Shipley (Sir M. Fox) on "The World at One", reverted to the magic circle, so that
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  our next leader eventually emerges from a smoke-filled room at Pratt's or Whites and has the blessing of Lord Whitelaw himself?
  7.26 pm
  Mrs. Maria Fyfe: Follow that!
  I shall not congratulate the Government on abolishing the tax on workplace nurseries. They should never have imposed it in the first place. My sympathies are with the women who have forked out several hundred pounds every year in tax for the past five or six years. Perhaps the Government will consider reimbursing them now that they have acknowledged that it was wrong to collect it in the first place. My sympathies are also with the thousands of women and men who could not use workplace nurseries because taxation had made it impossible for their employers to run them. Many people in Britain find it impossible to have the child care facilities that they need.
  As recently as 7 March, the Under-Secretary of State for Employment, the hon. Member for Teignbridge (Mr. Nicholls) was still denying that it would be possible to abolish the tax on workplace nurseries, so it appears that the Government should try to get their act together. Although it is a small advance, it will be useful only to a tiny minority of women.
  Abolishing the tax on workplace nurseries will cost that Government only about £1·5 million in revenue. The cost of providing comprehensive child care facilities would be about £2 billion. That is the yardstick against which the Government's neglect of child care can be measured. The figure that they are willing to spend comes nowhere near what is needed.
  Separate taxation for women has been proclaimed as a great advance. Of course the idea of separate assessment is welcome, but many women must have assumed that that meant that they would be taxed equally. However, in reality if Harry meets Sally and they get married, tax independence does not mean tax equality. If, for example, a husband and wife each earn £15,000 he will pay £2,558·75 in tax, while she will pay £2,998·75 in tax, so he will take home £430 more. Why could not the Chancellor allow married couples to divide the allowance between them? Does he believe in equality? It seems incredible that he did not undertake that small step, which would have cost precious little. Another attack on women's rights is the phasing out of child benefit.
  Separate assessment of taxpayers is welcome, but for the life of me I cannot understand why the Government cannot apply the same principle to the poll tax. We have heard much about TESSA, but one particular poll tax phenomenon could be called JASPER—joint assessment of pensions eliminate rebates.
  I quote the example of a couple in my constituency; the husband is severely mentally impaired and is exempted from paying the poll tax, but his wife must pay it in full because their joint incomes are taken into account in her assessment. She receives a state pension of £29 a week and a works pension of £43 a month. Her husband receives a state pension of £46 a week and a works pension of £115 a month. In assessing her liability for poll tax, the state has decided that those four small pensions should be joined and that therefore she must pay the poll tax in full, whereas if she had been a taxpayer she would have been in a different position. It is a severe injustice that she should

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  have to pay a full poll tax from so low an income. I hope that one day the Government will address themselves to that problem.
  The Chancellor has had 24 hours to reflect on the problem of retrospection for pensioners in Scotland. So far, we have heard that it is irrelevant because pensioners paid rates in England, that is not too easy to do and is far too much trouble and that attention should not be paid to the excitable Scots. If Conservative Members think that Scots are excitable, they have seen nothing yet. There has been a massive reaction to this in Scotland, and it is a further example of how the Chancellor has failed to think about the problem, as was obvious when the question was asked yesterday.
  That was irritating enough, but more irritating was the fact that it did not matter to the massed ranks on the Conservative Benches. They voted for the poll tax in Scotland a year before they did so for England and Wales. Once again, they were presented with sheer thoughtlessness by the Chancellor, but again they did not care tuppence. That fact is noted and resented in Scotland. If the Conservative party wants to hang on to its 10 seats in Scotland, it clearly has much to learn. Perhaps the Prime Minister should pay more attention to what she hears when she visits Scotland, instead of trying to play Lady Muck.
  Another pensioner couple in my constituency are both on disability pension. The wife receives an industrial injury pension. Their total weekly income is only £130, but they are not eligible for poll tax rebates, whereas previously they were eligible for 100 per cent. rate rebates. We are always hearing about how those in poverty will receive poll tax rebates, but it does not seem to have dawned on Conservative Members that under the old rating system couples living in such impoverished circumstances rightly paid nothing in local taxes.
  That couple, whose income is £130 a week, have no savings. Industrial injury benefit is supposed to be non-contributory and non-taxable, but it is counted for poll tax purposes. Such injustices are causing much resentment in Scotland. Hon. Members who voted for the poll tax in England and Wales will soon see the results of that in their surgeries when their constituents raise such problems with them. If they think that they will sail through and coast to another election victory, they have another think coming.
  7.34 pm
  Miss Emma Nicholson: My right hon. Friend the Chancellor offered us a minimalist Budget, which rests for its effectiveness on others' actions—a real Conservative effort which I commend to the House.
  Let us consider the way that the Budget feeds covenants and voluntary giving. It is an excellent progression, because covenants have gone down from seven years to four years and we await new Inland Revenue guidance to simplify charitable giving, which must be welcome because it will enable charities to plan ahead. It is all very well relying on emergency appeals showing a giver-friendly photograph of a starving child, but most charitable efforts rest on long-term work. I offer the House the example of the sponsorship of children's education, which rests on
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  covenanting and has been going on since 1921. Many millions of children worldwide have been educated as a result of British donations and the covenanting system. The new easement of covenanting is very welcome.
  An even better present is the big gift campaign for charities, which so far has been confined to the United States of America. That will make a difference to the incomes of volunteer organisations. I only wish that it were being introduced sooner than 1 October so that my local church, the steeple of which fell through the roof and will cost thousands of pounds to repair, could regain the tax from my first gift.
  There are 37,500 charities and, as my right hon. Friend the Chancellor said, social causes, the arts and other charitable efforts will benefit from the new tax system. A healthy and growing volunteer sector is a good indicator of the health of the economy and of the community. I fear that often it is not so popular with some Labour Members because it rests on individual initiative, but it epitomises the community spirit. I have experience of that from earlier days.
  The immense difficulty with charitable giving is broadening the base of donors. It is saddening to realise that only about 4 million households give to charity. Churchgoers are top of the pops, and the generosity of Jewish community members is greater than anyone else's. Generally, an orthodox donor will give to 25 different charities regularly throughout the year. The big gift tax relief announced by my right hon. Friend the Chancellor will give much scope to broaden the base of support.
  Which volunteer carries out the work that is financed by individual donors? The classic volunteer in the United Kingdom—our old friend the married woman—is in shrinking supply. I share the concerns expressed by other hon. Members about married women but want to concentrate on the income and capital of the married woman and the married couple's allowance under the new independent taxation system.
  Without wishing to appear ungrateful, I believe that the married couple's allowance is an unfair anomaly that should be scrapped. It gives higher net pay to a married man than to a married woman in equivalent circumstances. What justification is there for that? Even if a married couple wish to share the MCA, which is similar to the monetary compensation amounts in farming terms, they cannot do so unless the husband's income is too small to benefit, in which case it may be set against the wife's income. Why not give couples a free choice and then phase it out, distributing the takings equally? What is the point of identifying a woman as the lesser partner in a marriage? After all, real freedom is economic freedom, and one cannot compete equally in economic terms unless one is equal in terms of human dignity.
  The tax system should be family-friendly. The most vulnerable member of society is the child, whose care and nurture is mostly undertaken by the mother, and her financial health is crucial to the child's stability and growth. From that base, we should move rapidly towards independent assessment of married women's income for income tax purposes. That should be matched now by independent assessment for rebate for the community charge. Although I welcome the Chancellor's doubling of the capital limit, a wife's capital should be assessed separately and the ceiling should be double that of a single person. I would impose a ceiling to avoid creating a new unfairness and giving big gifts to the 11 per cent. of women

  1179
  who do not work, who have no small children, sick people or elderly people at home and who are married to wealthy men.
  I welcome the beginning of a vision of affordable quality child care. It will help working women immensely. I welcome the lifting of taxation on access to child care nurseries at workplaces. I hope that it will herald a move toward nursery places for all children in the United Kingdom. Most mothers do not want to take their children to work. Most mothers would prefer quality child care near home. At some point, this will have fiscal consequences for future Budgets.
  7.40 pm
  Mr. Graham Allen: The object at fault was probably not the Budget but the job description. The Chancellor was clearly told how far he could go and told that the main planks of economic policy rested not with him but through the door that is never opened between No. 10 and No. 11 Downing street. He was told that he could tinker around the edges if he felt like it, which is what he did. As far as job description went, he did a reasonable job, but it is irrelevant to the main problems confronting the economy.
  On Friday, I went to the Nottinghamshire CBI to find out what it thought the problems were, although one may think that that was not necessarily a favourable audience for my political point of view. The chairman of the CBI asked a number of his colleagues in the audience—senior directors, managing directors, and executives—to state what they thought the problems were. The person from the textile training association said that the main problem was the lack of training and the increasing closures in the area. A person involved in a medium-sized engineering plant said that the main problems were basically skill shortages. He was unable to get the quality of people that he needed, especially with the Japanese company, Toyota, moving in just over the border in Derbyshire and sucking in skilled workers from local companies.
  Another senior CBI member mentioned labour shortages. A person involved in heavy construction in the brick industry reported that the demand for bricks was down 50 per cent. and that he was running his plant at half capacity. Many of the problems that he encountered were due to interest rates. Someone from another engineering plant talked about the poaching of people who had gone through apprenticeships and then gone down the road to another company which was not prepared to train people but, because of the money thereby saved, could offer a marginally higher income. A local bank manager pointed out that lending had levelled out.
  Not one of the problems identified at that meeting was tackled by the Chancellor in the Budget. The Budget was irrelevant to the main problems of this country—irrelevant to the highest trade deficit in the G7 countries, to the highest inflation rate compared with our industrial competitors and to the highest interest rates in Europe. It was totally pointless and worthless in terms of the major direction of economic policy.
  Taxation is another matter that has not been dealt with in sufficient depth in this debate. A myth about taxation has developed under this Conservative Administration. It has been useful for the Government to reduce the level of income tax and to pretend that the taxation burden has fallen, but that is a myth. Because of the resources at their
  1180
  command, they have had the mastery to shuffle and reshuffle taxation. They have changed the pack without changing the basis and level of taxation. In terms of corporate and individual taxation, taxation is as near as dammit to the 1979 level.
  One specific tax to which I should refer before going much further is the poll tax. We have heard of the need to counter the actions of spendthrift councils, but it is worth pointing out that local goverment spending in England and Wales rose by only 15 per cent. in real terms over the 10 years from 1979—less than the 25 per cent. growth in national income and a small increase by previous standards. The Sunday before last, an article by William Keegan in The Observer referred to non-domestic rates growing by 59 per cent. and domestic rates by 83 per cent. and explained why. The article stated:
  "They were not only financing the (relatively slow) growth of local government spending; they were also filling the gap created by a fall of 18 per cent. (in real terms) in central Government grants to local authorities. In the current 1989–90 financial year domestic and non-domestic rates have together been financing 56 per cent. of local government current expenditure, against 38 per cent. 10 years ago".
  The proportion financed by central Government grants has fallen from 49 per cent. to 52 per cent. The Government have deliberately shifted the burden of total taxation towards the local ratepayer or the local poll tax payer. The extra burden on the rates has been equivalent to 3·5p in the pound on the rate of income tax, taken out of the 8p in the pound alleged reduction in the basic rate of income tax.
  Labour Members must continue to expose that sleight of hand, despite the central position given in people's minds to income tax. We must examine the income tax structure and reform it drastically. We need to legislate to do away with the effects of fiscal drag and to have an honest, clear debate each year on real taxation levels. The allowances and all the other factors associated with tax should be linked and increased automatically—perhaps in line with growth in the economy.
  If we wanted to reduce or increase taxation, there would be an honest debate on the level. Matters would be clearer if the tax system were structured into not two bands but many bands from zero to the top rate of tax, whether it is 50 or 60 per cent., in a series of 1 per cent. increases. In that way, income tax would be removed from its central place in the equation of our national spending.
  We need to restore our central objective in the economy. It must be a clear redefinition of our desire to invest more of our national wealth in our national well-being, forgetting our obsession with indicators and returning to the real economy. Our major and most successful competitors—Japan and Germany—pursued domestic growth and a reinvigorated domestic economy. We must do nothing less. There is a growing alliance in favour of that objective, which takes in the trade unions, the CBI and all the opposition parties. With that alliance in favour of manufacturing—an alliance for the real economy—we shall begin to crack some of our major problems.
  We shall also need—I am sure that my hon. Friends the Members for Brent, South (Mr. Boateng) and for Newcastle upon Tyne, East (Mr. Brown) will think this increasingly—to make an impact on the massive flows of hot money round the globe. We now have nearly $1 trillion floating round looking for a home. Now that interest rates in Japan are likely to increase, it is likely that much of that

  1181
  money will no longer go to subsidise our economy and that of the United States. We are staying alive on short-term foreign capital. We need to tackle that major problem and to reinvest in, and reinvigorate, our own economy. That will not be done by this Government; it will have to be done by a Labour Government.
  7.50 pm
  Mr. Michael Jack: On Saturday evening I had the pleasure of watching my right hon. Friend the Chancellor of the Exchequer being probed by a young lady on "Jim'll Fix It" on the subject of her pocket money. She asked a lot of searching questions and I now know where the principles of the Budget came from. She talked about thrift, budgeting and the care of one's money. Having examined the proposals in this, the first televised Budget, I think that this is a case of John having fixed it. I congratulate my right hon. Friend on having found a way of giving so much to so many when he had so few resources to deal with.
  The most important thing that my right hon. Friend did in the Budget was to rekindle the savings habit. That is especially important for children. Budgets are as much about short-term economic activity as about laying the foundations for the future. Having said that, I asked my right hon. Friend to consider the role of the national savings movement in the new world of saving. Many will look to national savings as the ultimate safe haven for their money. Savings may still be clouded by the taint of the Barlow Clowes affair.
  My hon. Friend the Financial Secretary will know that in my own constituency, and in the adjoining constituency of Blackpool, South, many thousands of workers do vital jobs in the savings movement. National savings sometimes provides the Treasury with much-needed smoothing finance to enable the Government to pay their bills. I ask my hon. Friend the Financial Secretary to look again at the range of products and the rates of return, in spite of the announcements made in the Budget, and to ensure that the national savings movement can play a full part in the new world of savings.
  In particular, I ask my hon. Friend to view premium savings bonds sympathetically. Last year, for reasons of administration and cost, Treasury Ministers raised to £100 the limit on entry to this very good savings scheme. I ask my hon. Friend to consider lowering the figure to £50. If he cannot do that, I ask him at least to consider introducing a savings stamps scheme to enable people to save to enter premium savings bonds as they represent an attractive form of savings for the unsophisticated, and as many of my constituents make their living by administering them I would be much reassured if my hon. Friend the Financial Secretary agreed to do that.
  The Budget is good for pensioners' savings. Many pensioners have saved throughout their lifetime, and at last the Government have answered the plea of many of us that they should stop penalising thrift. I congratulate my right hon. Friend the Chancellor on that.
  I have referred to children and to savings. I also have a query about my right hon. Friend's excellent announcement on nursery places and the exemption from tax. What happens if a company that does not have a workplace nursery issues vouchers to employees? Will they be
  1182
  included in the schemes that my right hon. Friend announced? Will such vouchers be encashable, for example, against pre-school playgroup activities? Many people find pre-school playgroups an adequate source of child care, and I feel that my right hon. Friend may come under pressure to grant such a concession. We seek clarification on that point.
  I also have a question about children and value added tax. I have two sons, both of whom seem to be growing at an alarming rate. My wife tells me that already my 10-year-old is moving into adult-size clothing and shoes. It was in the early 1970s that the size of children's clothing was first established for the purposes of the VAT regime. Will Ministers look again at the sizes of children's clothes because the information available from the retail trade and other sources suggests that children are wearing larger sizes for their age than they were when the regulations were first framed? If the Budget has anything to do with children, Treasury Ministers should reconsider that. At a time when my right hon. Friend the Chancellor—perhaps for good reasons—has had to freeze child benefit, he could help children and their mothers greatly by changing the regulations in respect of the sizes exempt from VAT.
  I express some disappointment that the sum total of the environmental content of the Budget was to widen the differential between leaded and unleaded petrol. In my constituency, energy saving is an important industry in its own right. We have a company that has pioneered many techniques in the contract energy field. Surprisingly, the company accounts of Emstar—a subsidiary of Shell which is not in my constituency but which is dedicated to energy-saving techniques—show that that company has recorded a loss. The sales of energy-saving equipment are also declining.
  Such investment may well be affected by world energy prices, which have fallen in real terms, and may be marginalised by current high rates of interest. I accept that those high rates are vital if we are to fight inflation, but I believe that the wider environmental issues—for example, dealing with the greenhouse effect—cannot be left entirely to the operation of market forces. I therefore ask my hon. Friend the Financial Secretary to consider changing the capital allowances for those expenditures that save energy and contribute to the reduction of the greenhouse effect, and thus to help environmental investment.
  Let me deal with the question of investment in industry. I am sad that the hon. Member for Manchester, Central, (Mr. Litherland) is not in his place. I am fed up with Opposition Members denigrating investment in the north-west of England. To talk about Manchester as he did is to undermine the investment that has taken place in Salford Quays, in Trafford Park, in Preston, in my own constituency and throughout the north-west. We have had massive investment in aerospace. We have had investment in traction plants such as GEC Alstone in Preston. We have had £14·5 million-worth of investment in Foxe's Biscuits in my own constituency. I see my hon. Friend the Minister for Roads and Traffic in his place. In his constituency of South Ribble, too, investment has taken place in aerospace. Those investments were made not with failure in mind but with success in mind.
  If the Chancellor has achieved one thing in the Budget, it is that, by underlining his target of 5 per cent. inflation by 1991, he has given confidence to those who are investing in the economy. Our present difficulties will have a satisfactory resolution. Now is not the time to stop

  1183
  investing; now is the time to invest, to take advantage of a more competitive currency and of the export opportunities and to help Britain—particularly the north-west—to continue the economic growth that my examples have underlined.
  I was delighted that my right hon. Friend the Chancellor took time in his Budget speech to highlight the growth in local government expenditure. The hon. Member for Nottingham, North (Mr. Allen) should compare the national pay and prices index with local government expenditure on pay and prices. He would find a picture very different from the one that he painted for the House this evening. Many local authorities have been profligate over the past few years, encouraged by the inadequacies of the grant-related expenditure system. One advantage of the community charge is that it will help them to curb their expenditure by bringing discipline in that area.
  Finally, I congratulate my right hon. Friend the Chancellor on the changes that he made in the capital allowances relevant for help with the community charge. His measure will enable more people to gain income support and to be passported to other benefits, such as free prescriptions, vouchers for glasses and free dental care. That will be of great value to the elderly. However, much as I applaud the increase of the capital allowance to £16,000 for community charge benefit eligibility, I ask him to listen sympathetically to the Secretary of State for the Environment, because there are other ways in which the rebate scheme will require modification and they will cost money.
  Above all, the Budget has underlined our commitment to fighting inflation. It shows that that can be achieved. I congratulate my right hon. Friend the Chancellor on his efforts.
  Madam Deputy Speaker: The Standing Order that limits speeches to 10 minutes has now been lifted.
  8 pm
  Mr. Thomas McAvoy: Thank you for that, Madam Deputy Speaker.
  After listening to the hon. Member for Fylde (Mr. Jack) and having ascertained that his majority is not all that big, I look forward to seeing his photograph flashed across the television at the next general election with the words "Labour gain" above it—[Interruption.] I am advised that the hon. Gentleman's majority is 18,000. Perhaps we should ask him on Friday morning about Mid-Staffordshire's previous majority and about whether he expects his seat also to be a Labour gain.
  The problem with speaking after four and half hours of debate is that many of my hon. Friends have scored off subject after subject, leaving me with only a few subjects on which to speak. I shall concentrate on only two areas that have not been mentioned previously, but first I reiterate the point about interest rates.
  Hoover has a factory in my constituency. Indeed, I used to work there. About 50 years ago that factory employed 5,800 people, but in October or November last year, the company announced that it had only 1,000 workers. In that announcement, the company specifically mentioned interest rates as the direct cause of the latest round of cuts and redundancies. Hoover is an important manufacturer in this country, with a plant in Wales as well as a factory in Scotland. It has been affected by the high interest rates,
  1184
  which have directly caused a fall in sales, which has resulted in a downward spiral of employment in my constituency and in Wales. High interest rates also contribute in bringing imports into the country.
  If we look to the Government to deal with that problem and to reduce interest rates, we are looking in vain. There was nothing in the Chancellor's speech yesterday to help with that problem. Indeed, at the risk of upsetting the Financial Secretary to the Treasury, who gets upset if he is mentioned, I did not hear anything from him today to suggest that there is any hope that the Government will give any consideration to the plight of manufacturing industry. In the past 11 years, the Government have run down manufacturing industry and seem to have a guilty conscience. Perhaps that is what seemed to upset the Chief Secretary earlier when he responded so immoderately to the speech of my hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington).
  Although Conservative Members will not like this, I remind the House of the way in which the Government have treated Scotland as a nation since 1979. It is interesting that the hon. Member for Londonderry, East (Mr. Ross) noted that nothing has been said from the Dispatch Box about how any of the Budget changes will affect Northern Ireland. That is typical of the Government's approach. The Government are simply election-minded. They consider those who vote for them; those who do not vote for them do not count. That is a disgraceful attitude from a party that has trumpeted for years that it is the party of empire and of nation.
  Let us consider the way in which the Government have treated Scotland and the attitude shown by yesterday's poll tax announcement. I do not agree with the conspiracy approach that suggests that the Government deliberately snubbed Scotland and planned to be vindictive towards it, although that seems a usual enough course for them to follow. My hon. Friend the Member for Glasgow, Maryhill (Mrs. Fyfe) put her finger on it when she said that the Government did not realise what they were doing—they neither appreciated nor cared. Although there are still 10 Conservative Members representing Scottish seats, we in Scotland do not count.
  That attitude causes strains and tensions within the United Kingdom. When even a moderate person such as the hon. Member for Gordon (Mr. Bruce), reacting to yesterday's announcement, said that it called into question the Act of Union between England and Scotland, surely that flags before the Government the fact that they are creating tensions within the United Kingdom that no Government, of any party, should cause.
  My party has not advocated disruption or non-payment of the poll tax, although we recognise the right of individual conscience. However, the Government do not seem to realise—the Chancellor certainly did not seem to realise this yesterday—that yesterday's announcement will contribute to a heightened atmosphere of injustice and insult in Scotland and a feeling that the Government here are alien and do not have a sovereign right to govern in Scotland. I do not normally support that point of view, but I warn the Government that the Chancellor's reaction yesterday will result in a social movement in Scotland which, in turn, will result in opposition to the Act of Union.
  The Tory party takes the view—we rightly hear it from the Chair—that this is a United Kingdom Parliament. As a Member of Parliament and a former councillor, I take

  1185
  the view that I was elected on a certain political platform and I expect to live up to it. I also take the view that, once elected, I represent all my electorate on matters of social justice. If anybody comes to me with a problem, it is my job and my duty to ensure that I represent that person, irrespective of party. In the best traditions of the Labour movement, I have always been told that I should represent all my electorate on matters of social justice.
  Although we welcome yesterday's announcement about capital allowances and the poll tax, because any relief for anybody is welcome, there is no doubt that that measure was achieved only because of the backlash from English and Welsh Conservative Back Benchers who have been pressured by their constituencies.
  We hear many confessions from Conservative Members who say, "I voted against the poll tax," but time after time when we look back at their individual records, we see that they voted for the poll tax for Scotland. That is hypocrisy. They may have voted against the poll tax for England and Wales, but they trooped through the Lobbies to impose it on Scotland. Therefore, I do not take kindly to crocodile tears from Conservative Members about the backlash in England and Wales.
  As the transitional payments in Scotland have not yet been paid, perhaps they could be backdated. It is reasonable that the £16,000 capital allowance increase should be applied retrospectively to Scotland. We have heard weak points about why that cannot be done. However, we keep hearing from the Prime Minister that if the political will exists, something can be achieved. It is clear that there is no political will to do that for Scotland. That is a social injustice and a disgrace. That demonstrates once again the folly of the tax being introduced initially in only part of the kingdom and introduced in England and Wales as a second stage.
  Although I do not normally attack or criticise hon. Members who are not present, I must comment on the absence of Scottish nationalist Members from the debate. Yesterday, they sought to follow my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) who, uncharacteristically, rose to intervene in the Budget debate to try to gain an assurance for Scotland. I do not see why Scottish National party Members cannot sit in the Chamber for four and a half hours, as I have, to try to get five or 10 minutes in which to make Scotland's case. They are not here when there is any work to be done or any applications to be made on behalf of Scotland.
  Only a Labour Government can bring social justice to the United Kingdom. In the past 10 years the Government have breached the convention that means that, once a Government are elected, they represent all the people. I remember the Government of Harold Macmillan. I never felt that I was living under a Government who oppressed me or who were vindictive towards me. I did not agree with that Government, but, as a British citizen, I never felt that the Government of my country were treating me as an alien. However, that is how people now feel in Scotland.
  The Secretary of State for Scotland did not see fit to show his face in the Chamber yesterday and, as far as I am aware, he has still not chosen to appear in the Chamber. On Monday, when I attended the Scottish Grand Committee, I referred to the Secretary of State as toom tabard. That is a Scottish term that goes back to the
  1186
  Edwardian wars when mediaeval England was trying to make Scotland a vassal state. The Scottish people were so contemptuous of the then Scottish king that they nicknamed him toom tabard, which meant that the suit of armour was empty and that the man who represented Scotland was empty. The Secretary of State for Scotland is exactly the same.
  According to press reports, the right hon. and learned Gentleman sat through the Cabinet meeting, heard the Budget, but did not see fit to stick up for Scotland when it came to backdating the capital tax allowance. Where was the voice of Scotland? That man is supposed to represent all the Scottish people at the Cabinet table, but he did not speak up for them. He has abdicated his responsibilities and he should resign. According to press reports he followed the Budget speech from his office in Whitehall—and no wonder. He knew full well what the reaction and resentment of Scottish Labour Members, as well as his right hon. Friend the Member for Kincardine and Deeside (Mr. Buchanan-Smith), would be to the announcement.
  It is interesting to contrast the allegedly powerful position in Cabinet of the Secretary of State for Wales with that of the Secretary of State for Scotland. We can speculate as to why the Secretary of State for Scotland remained silent at the Cabinet table. Perhaps it was due to lack of courage or lack of weight, as he knows that he is not really considered "one of us" by the Prime Minister. Perhaps he was scared to speak up, pure and simple, because he knew what the reaction of the Prime Minister would be. Whatever the reason, he was a toom tabard and he is not fit to hold office. He should resign.
  When the announcement about the capital allowance was made yesterday, I watched the reaction of the Secretary of State for Wales. He took great delight at sneering, denigrating and laughing at the anger and resentment expressed by Scottish Labour Members. That was the reaction of a so-called "wet" who is supposed to speak for all the bleeding hearts on the Back Benches of the Tory Party. Yesterday he demonstrated the vindictiveness of a true Conservative of the present mould by his reaction to the anger of Labour Members.
  My right hon. Friend the Leader of the Opposition has described the Budget as a "bits and pieces Budget" and I agree with him. If anyone on the Conservative Benches thinks that our anger yesterday was fabricated and that it did not amount to anything, they are in for a shock. That anger will be maintained. At present there are 10 Tory seats left in Scotland. Before yesterday I would have said that the Tories would hold on to four or five of them, but, after yesterday, they are heading for a complete whitewash.
  8.13 pm
  Mr. Graham Riddick: It is always interesting to follow a Scottish Labour Member, and it is always somewhat amusing to Conservative Members to note the continual squabble between the Labour party and the Scottish National party.
  The hon. Member for Glasgow, Rutherglen (Mr. McAvoy) referred to Conservative Members voting in favour of the community charge for Scotland. I did not vote for its introduction in Scotland as I was not in the House at that time.
  Scottish Labour Members have some cause to feel slightly aggrieved that the Chancellor made the concession

  1187
  on capital limits yesterday and that that concession was not made this time last year. Let us be brutally honest about why that did not happen. The Chancellor made that concession because a sufficient number of English and Welsh Members of Parliament urged him to make it. He took their request on board and conceded to the pressure.
  The problem for Scotland is that the Scottish people failed to vote in sufficient Tory Members to carry enough weight within the Conservative party. If there were more Scottish Tory Members, the views of Scotland would be heard more loudly. That is a purely personal view, but I believe that there is a strong element of truth in it. If there were more Scottish Tory Members, Scotland would have more influence with the Conservative Government. I hope that the Scottish people will take that on board as a lesson to be learnt. They should send more Conservatives to this House so that Scotland has more influence on this Conservative Government.
  I add my congratulations to my right hon. Friend the Chancellor on the relaxed, confident style of his Budget. His room for manoeuvre was, of course, limited. It was a neutral to toughish Budget, which made it crystal clear that the defeat of inflation was the Government's No. 1 objective. Within the confines of the current economic scenario my right hon. Friend was able to provide real help to savers, charities, small businesses, blind people, working mothers, and, last but by no means least, football fans. This Budget has pitched the Conservatives firmly into the middle ground of British politics.
  Some analysts have suggested that the Budget should have been tougher. I do not believe that the Budget could possibly be described as soft when its net effect is to take some £500 million out of the economy. To have made a significant impact on the wider economy the Chancellor needed to take billions of pounds—perhaps as much as £10 billion—out of the economy. To raise taxes along those lines, however, would have been indefensible on fiscal and moral grounds at a time when we have a budget surplus. If monetary policy was to be tightened—I believe it is tight enough now—interest rates would have to rise once more. I sincerely hope that that does not happen.
  Some people, particularly Labour Members, have suggested that the explosion of credit that occurred in the past two years was caused by the reduction in taxes announced in the 1988 Budget. That Budget put some £4·5 billion into the economy. I contend that it was the unnecessarily steep reduction in interest rates in the first six months of 1988, which put some £44 billion into the economy, which caused the problem. The sum of £4·5 billion pales into insignificance when compared with £44 billion. It was loose monetary policy, not loose fiscal policy, which led to the current problem of inflation. With interest rates at their current high level, no one could possibly claim that we are following a loose money policy.
  I applaud the straightforward approach adopted by my right hon. Friend the Chancellor. He had to raise some money, and he did so by openly raising excise duties and not by craftily extending the net of capital gains tax or extending the composite rate tax to personal bank accounts—quite the reverse. My right hon. Friend now intends to abolish one of the most sneaky and immoral taxes, the composite rate tax, which is paid by millions of non-taxpayers who see building societies and banks as safe havens for their savings. They probably know no other form of savings vehicle and many of them probably do not
  1188
  realise that the income from those savings is taxed. I commend my right hon. Friend the Chancellor of the Exchequer for that brave and thoroughly correct decision.
  On behalf of salesmen, sales managers, district nurses and thousands of others who could not do their jobs without company cars, I thank my right hon. Friend for not hammering company car drivers. The 20 per cent. increase in company car taxation is quite enough, but certainly nothing like as bad as many people predicted. I speak from personal experience, because before I came to the House I was a sales manager at the sharp end of industry. I travelled many thousands of miles in my company car, and there is no way that I could have carried out my job without that vehicle. I used to resent the fact that company car tax was being increased when I had absolutely no choice in the matter because I had to have a company car. I know many people who drive 20,000 30,000 or 40,000 miles a year in pursuit of their careers. The Government should be careful before hitting such people. By all means, they should hit hard directors who do little mileage in their company cars and for whom they are a perk.
  I shall touch on one other aspect of the Budget relating to cars. I commend my right hon. Friend the Chancellor's decision not to raise vehicle excise duty, but to raise the excise duty on petrol, DERV and unleaded petrol by more than the inflation rate. That provides an element of choice, whereas if the vehicle licence is raised by £10 or £20, regardless of the mileage done in the car, drivers have to pay that extra amount. If the extra cost is put on petrol, the more mileage is done, the more is paid in excise duty, and that is only fair.
  I thank my right hon. Friend the Chancellor for significantly relaxing the savings rules relating to community charge rebate. With many colleagues including my hon. Friend the Member for High Peak (Mr. Hawkins), I have been pushing the Government to increase the savings limit of £8,000 above which a married couple do not qualify for rebate. My right hon. Friend the Chancellor doubled the limit to £16,000 not only for married couples but also for single people. Therefore, ironically, the anomaly still exists. There could well be a case for saying that, for a married couple, the savings limit should be raised to £24,000 and should be £16,000 for a single person.
  The new higher savings limit is most definitely a step in the right direction. However, much more will have to be done to alleviate the introduction of the community charge. For any tax to work, there has to be general public acceptance of it. One does not have to be a brilliant political strategist or analyst to acknowledge that the community charge does not enjoy such public acceptance at present. When I talk to my constituents and meet members of the public, I find that people accept that everyone should make a contribution to local services. The community charge ensures that that happens and will certainly, in future, make local councils more accountable to their electors.
  However, public acceptance does not exist at present because the community charge levels are simply too high. We know that the major reason for that is that many councils, mainly Labour councils, have taken the opportunity of the changeover to the new system of local government finance to jack up their budgets and spending. It is immoral for councils to take advantage of many thousands of ordinary people by increasing their budgets

  1189
  and thereby levying unnecessarily high community charges. However, that is happening, and the Government have a responsibility to try to alleviate the problems associated with high community charge bills.
  The Government must make two moves. First, they must disregard savings when calculating whether someone qualifies for community charge rebate. Qualification for rebate should depend entirely on income. That will ensure that the disincentive to save no longer exists and those on low to modest incomes will be properly helped.
  In response to a parliamentary question which I tabled about 10 days ago, the Department of Social Security estimated that such a move would cost the Exchequer between £250 million and £300 million per annum. In the mysterious and discouraging way of departmental answers, that one ignored the income from savings, so the figure would actually have been substantially lower. Some people say that such a move would benefit rich people, who could then qualify for rebate. I do not believe that that will happen. There is clearly a relationship between the amount of savings people have and the income they receive from them. If someone has £30,000, £40,000 or £50,000 of savings, the income from them will take him or her above the income threshold below which he or she qualifies for rebate. Therefore, to help many people on modest incomes, particularly pensioners, we must examine the possibility of doing away with the savings limit altogether.
  The second move will cost the Exchequer a great deal more. Public acceptance of the community charge will come when the bills arrive later this month only if community charge levels are significantly lower than those proposed. We shall have to use any money available for tax cuts next year to reduce this tax, the community charge. We shall have to use more Government money to reduce the community charge level. Whatever pretext we use, be it taking a portion of education spending, the police or the fire service away from local authority control or simply increasing the revenue support grant, the Government will have to act.
  A good starting point would be to provide the same level of Government grant in England and Scotland as is enjoyed in Wales. My right hon. Friend the Secretary of State for Wales has boasted in the House that community charge bills in the Principality will be £100 per person lower than they will be in England. That will do for me for starters. In a debate on 18 December 1989—about three months ago—my right hon. Friend the Secretary of State for Wales boasted that people would be paying £100 less in Wales than in Scotland and England. He also said that 85 per cent. of local government expenditure in Wales is met by the business community and the Government. I believe that the figure in England and Scotland is about 75 per cent. We shall have to come in line with Wales.
  I congratulate my right hon. Friend the Chancellor of the Exchequer on an interesting and imaginative Budget and on making the most of the few resources available to him. I fear that his most difficult task lies ahead. I hope that he will be able to alleviate most of the problems that many constituents are suffering due to the introduction of the community charge.
  8.29 pm
  Mr. William O'Brien: I am very disappointed that the hon. Member for Colne Valley (Mr. Riddick), a Member from west Yorkshire, an area that I too represent, could talk about company cars and about giving up local influence in education, the police force or the fire service but found no reason to refer to the problems of industry in west Yorkshire, particularly the textile industry. Neither the Chancellor nor the Financial Secretary has mentioned this at any time, yet west Yorkshire has significant problems. The hon. Member for Colne Valley must have constituents who work in textiles, so I am disappointed that he talked about company cars but could think of nothing to say about local industry.
  The hon. Member also gave us some reasons why the Treasury should reconsider the poll tax next year—but he voted for the introduction of the poll tax at the very beginning. How hypocritical can people be? The hon. Member for Colne Valley goes through the Lobby supporting the introduction of the poll tax, yet when the wrath of the people is felt he and others shy away and now want to introduce alternatives to ease the burden. Why did not the hon. Member join Labour Members in opposing the poll tax in the very beginning? The hon. Member for Colne Valley should have thought of this when Opposition Members were warning of the likely results of the poll tax.
  Nor has the hon. Member for Colne Valley found anything to say about housing in west Yorkshire. In his constituency, as in mine, there is a shortage of rented accommodation. Throughout west Yorkshire there is a shortage of affordable housing. Yet the hon. Member appeared to see no reason to refer to the problem in his speech tonight.
  The hon. Member for Colne Valley referred to our Scottish colleagues. He said that more people should vote Tory in Scotland so as to have better representation. The same principle applies in west Yorkshire, only there we need more people to vote Labour so that a Labour Member could properly represent the constituents of the hon. Member for Colne Valley. If the principle applies to Scotland, it must also apply to west Yorkshire.
  Mr. Riddick: The hon. Member for Normanton (Mr. O'Brien) clearly has nothing to say of his own; he is just waffling on, trying to waste some of the time available before 9 o'clock. His attack on me is smutty, wholly unnecessary and wholly out of place. As regards the community charge, I voted against my Government on a three-line whip: I voted for the Mates amendment which would have improved the community charge markedly in relating it to people's ability to pay. Although we did not win that vote, I did my bit.
  Mr. Martlew: On a point of order, Mr. Deputy Speaker. Is the hon. Member in order to speak in this way?
  Mr. Deputy Speaker (Sir Paul Dean): Order. It would be helpful if the hon. Member for Colne Valley would conclude his intervention.
  Mr. Riddick: Thank you, Mr. Deputy Speaker. I am surprised that the hon. Member for Carlisle (Mr. Martlew) does not believe that I should have an opportunity to reply to a wholly scurrilous attack. May I make two brief points before I sit down? Inflation is the biggest concern facing industry in my constituency. Unemployment has come down by 50 per cent. in the past two years.
  Mr. O'Brien: Was the hon. Member for Colne Valley trying to extend his speech? My points must have been relevant or he would not have risen to the bait as he did. He told the House that he voted for the poll tax. He cannot have voted against it because he told us that he had voted for the Mates amendment. The amendment was still in favour of a poll tax although trying to find a different formula. Yet tonight the hon. Member says that changes should be made.
  My point was that if it was right for the hon. Gentleman to address his remarks to my Scottish colleagues as he did, he cannot object to my addressing remarks in a similar vein to him.
  Mr. Lilley: Will the hon. Member for Normanton (Mr. O'Brien) confirm to his constituents that he will have the courage, should the unlikely time ever come when there is a Labour Government, to vote against a three-line Whip on a Bill to impose a roof tax on those constituents?
  Mr. O'Brien: Under this system there is a roof tax because the standard rate of tax is on property, not on the individual. The Financial Secretary should realise that when the Government say that no property tax is attached to the system that they are introducing they are again misleading people. The standard rate of poll tax is nothing more than a property tax.
  Earlier I said that the hon. Member for Colne Valley had made no reference to housing or to the high interest charges on mortgage repayments that people in west Yorkshire must face. The Chancellor informed the House yesterday that interest rates would remain high for some time. He could give no assurance that they would be reduced either in the near future or at some later stage. All that he said was that interest charges would have to remain high for as long as was necessary and that he would decide when it was necessary to reduce them.
  This is cold comfort for businesses and for people with mortgages. Using high interest rates to control expenditure and reduce inflation hurts not only those who run businesses, particularly small operators, but the middle-aged or elderly people who have mortgages. It also hurts younger people who are starting to buy their own homes. They too have to face high mortgage charges plus high interest rates.
  There is no comfort whatsoever in what the Chancellor said yesterday and what the Chief Secretary has said today for people who are trying to meet their commitments in buying their homes. They must dread the thought of interest charges being increased again. The Chancellor made it clear that in the coming months it may be necessary to raise interest rates again. Tory Members have shown that they are worried that there may be further increases in mortgage charges. What comfort is that for people who have a mortgage and have to meet the extra increase each month?
  Young couples with gaunt looks on their faces attend my advice meetings, asking what: they can do to obtain council houses because they can no longer afford to pay the increased mortgage payments. They thought that the increases could last three or four months, or perhaps six months at the outside, but they have been going on for so long with no hope of a reduction that it is impossible to meet the repayments. They hope that the local authority will give them council houses.
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  Because of the Government's policy, council dwellings that used to be available for rent no longer exist. In addition, local authorities have no opportunity to replace the houses that they have lost from the rented sector. Conservative Members are reconciled to the fact that further increases in mortgage charges are inevitable. If that is the case, business people and home buyers, particularly in my constituency and generally throughout the country, must be horrified that the Chancellor has given no hope of a reduction in interest rates but has mentioned the possibility of an increase in mortgage charges.
  After 11 years of Tory rule, we have record interest rates, the highest mortgage charges, the longest waiting lists for rented accommodation, including council houses, the highest number of homeless people and the lowest number of houses for rent in the past 30 years, yet the Chancellor does nothing whatever about it. That is Tory Britain of the 1990s.
  I join Tory Back-Bench Members who have the courage to say what they think is wrong with the economy. They ask the Chancellor to reconsider how the Government are tackling inflation. Not only interest rates should be used to control inflation; taxation should be considered. Even the hon. Member for Colne Valley, who is no longer in his place, said that the Government should consider taxation as a further means of solving our economic problems. The Government should not rely completely on high interest rates to get the Tory party out of the mess that it has created.
  Many constituents have made representations to me that since the Tories came to power prescription charges have increased by over 1,000 per cent. In 1979 the charge was 20p whereas now it is £3·05. That is Tory Britain in the 1990s. That is the direction in which the Government are leading the country.
  I could have challenged the hon. Member for Colne Valley about the way in which Yorkshire water authority is charging for water services. It has doubled the standing charge. The Prime Minister's reason for a change in the rating system now applies to water charges. Often at the Dispatch Box she has defended that dear old lady living alone yet paying the same rates as a family of four adults living next door. She made it clear how unfair that was. That same dear old lady is paying the same standing charge for her water services as the family of four adults next door. What justice is there in that? Yet Ministers do not comment on that injustice.
  Let us analyse the unit costs. That dear old lady is paying much more per gallon of water than the four adults next door. What justice is there in that? Yet neither the Chancellor nor the Chief Secretary to the Treasury mentioned that unfairness.
  Council house rents are being increased in line with Government policy. Under the Local Government and Housing Act 1989 local authorities must increase rents until they reach what is termed market rent level. What does the Budget provide to ensure that market rents are fair and reasonable? We often hear the Secretary of State for the Environment say that it is Government policy to encourage affordable rents so that people on low incomes, particularly those in rural areas, can meet the charge for rented accommodation. Yet the Budget provides no help for people who will face massive rent increases.
  A great deal has been said about the poll tax and the increase in the savings ceiling to £16,000. It is hoped that that will bring more people into the rebate scheme.

  1193
  However, it is the basis of the rebate scheme that is at fault. Whether or not a person has savings of £16,000 or less, if his income is less than £46 a week, he will qualify for a rebate. A widow in receipt of state pension plus a small occupational pension, in her own right or that of her husband, could lose under the rebate scheme because she has an income of £46 or £47 a week. It is little comfort to people constantly to hear about the rebate scheme when many of them will not qualify. In any event, as a result of the taper, more people will lose out.
  Under the existing rating system, people whose property is not coupled to the main sewer can qualify for a rate reduction because they are not receiving that service. Also, because they have a cesspool and must bear a charge for its being emptied and the sewage being treated by the water authority, they can qualify for a reduction in their gross rateable value and hence pay less rates. But they must pay the same poll tax as those whose property is attached to the main sewer. In addition to paying the same, they must continue to pay for the cesspool to be emptied and for the sewage to be treated by the water authority. How inhuman and unjust that is. It means that people are not only not receiving a service but must pay twice for the privilege of being in that position. That is Toryism in the 1990s.
  The same can be said of properties that are not on a made-up road. Under the present rating system, the occupiers can apply for a reduction in gross rateable value because they are not receiving the service of a properly made-up road. Under the Government's poll tax system, they must pay the same as people who live on a made-up road. Indeed, they will be charged extra if the local authority decides to make the road serviceable.
  Mr. Malcolm Moss: As I have listened to the hon. Gentleman I have become angrier and angrier because what he is saying is just not true. Will he name one local authority in Britain that is not responsible for water services?
  Mr. O'Brien: The hon. Gentleman is not aware of the facts of life. If a property is not coupled to the main sewer, the water authority informs the occupier that an order must be obtained from the local authority for the necessary work to be done, as the local authority must make a contribution to the cost of that work. I am happy to educate the hon. Gentleman. The practice that I have described was introduced by a Conservative Administration. If the hon. Gentleman agrees, as he must, that it is an injustice, I trust that he will join Opposition Members in the Lobby on Monday and vote against the anomalies that we are exposing.
  I was recently a member of a Standing Committee which considered a statutory instrument concerned with the amount of money being made available to the Housing Corporation so that housing associations may finance the building of additional rented accommodation throughout the country. As we looked into the matter, we discovered that less was being made available in 1990 than in 1985. In 1985, £3,500 million was made available to the Housing Corporation. In 1990 the sum had fallen to £3,300 million. In other words, the Government are ignoring the need to provide homes for the people at a time when we have record homelessnes, with huge numbers of people looking
  1194
  for rented accommodation. The Government in general, and the Chancellor in particular, are doing nothing to ameliorate that.
  Tory councillors all over the country are leaving their party because of the problems they face over the poll tax. In Beverley, 10 Tory councillors resigned; in Cornwall, a number of Tories quit the party because of the poll tax; in West Devon, 19 Conservative councillors left the party for the same reason; and I draw the attention of the House to early-day motion No. 743, which says that Boothstown Conservative club members have decided to opt out of the Tory party and have taken down the portrait of the Prime Minister, their president, because of the poll tax provisions.
  Conservative Members must accept that so hated is the poll tax that even their supporters in local government are leaving the party in droves. Whatever happened when the Labour party was in office, the party was strong. Today the Tory party is weak. Conservative Members who are sincere in wishing to represent their electors will make sure that the Budget provisions which injure their constituents are not allowed to go through. Accordingly, next Monday they should vote with my hon. Friends and me against those provisions.
  8.56 pm
  Mr. Alan Meale: I am surprised to have this opportunity to speak in the debate. About an hour ago I was in the Lobby and was told that, if I came into the Chamber, I might be called to speak.
  In the Tea Room, the Library and elsewhere in the Palace of Westminster I have been listening to hon. Members of all parties discussing the Budget. I have heard it described as a poor Budget, as a bad first performance by the Chancellor, as a juggler's Budget—not surprising, in view of the activities of his parents—and as a cigarette card Budget, meaning that it would be of interest to smokers but of no interest to non-smokers.
  The most apt description is that it is a sad Budget, because it is a Budget of lost opportunities. It contains only short-term solutions to the problems facing the nation. It deals purely with the electoral strategies of a Government in severe danger of defeat at any election that they face, whether in Mid-Staffordshire tomorrow, a local election or an election in a Conservative club in Yorkshire or Oxfordshire. Everything that is happening at present seems to be bad for the Conservative party.
  The Budget gives little hope to the people of the nation, particularly those who need a lot of help as a result of the Government's strategies over the past 10 or 11 years. It will be remembered as much for what it did not do as for what it attempted to do. The parliamentary agenda provides a day in which a Budget must be set. The Budget tries to spend nothing and tackle nothing so that it can get away with doing nothing at a time when the Government are in severe trouble.
  I hope that all those Conservative Members who truly disagree with what is happening will go into the Lobby with us on Monday. I know that they talk to their party members and their constituents on the high streets and market squares in their constituencies.
  The Budget offers the unemployed nothing. The stark reality of the Budget is that it makes no attempt to discuss the needs of the millions of people who are unemployed. Instead, it says that economic growth has gone out of the

  1195
  window for the next few years. In the foreseeable future the economy will be in a worse state than it is now. Even some Conservative Members, admit that; some of them may be more daring than others on such things as economic strategies or the poll tax. They trip the light fantastic and vote against the Government, although usually on an amendment, and they go missing for the vote on the main Question. They have crossed the Floor into our Lobby, but they stay around for only a short time.
  The Chancellor and his Back Benchers have been offering a great hope to the people of Britain that next year will be the big give year. Between £16 billion and £17 billion will be thrown about by the Government before the election. However, they have missed a real opportunity this year to do something for the millions of electors who are pensioners and who, for the past 11 years, have had a bad deal from the Government. [Interruption.]
  It is no good the Minister smiling and telling us to look at what the Government are doing for the pensioners—the investment plans that are available to them and the raising of the threshold from £8,000 to £16,000 for relief on housing benefit and so on. I am talking about the millions of pensioners who have not got £8,000 or £16,000 and who rely on state benefit to get by day after day. A 0·37 p tax increase would have enabled the Chancellor to give every pensioner and severely disabled pensioner in Britain a free television licence. That is a small amount of money.
  Mr. Moss: Is the hon. Gentleman telling the House that that is what the Labour party will do if they are elected?
  Mr. Allen McKay: Yes.
  Mr. Meale: That question has been answered for me. We are committed to increasing pensions and we shall give winter allowances before the winter sets in. Pensioners are a major part of our strategy, as are the National Health Service and the unemployed.
  The Government talk about helping pensioners, but they are not willing to increase taxes by 0·37 p to give pensioners and disabled people a free television licence. I welcome the increase from £8,000 to £16,000. That is better than nothing, but that will affect only a few people. The vast majority of pensioners, particularly those who rely on the basic state pension, will still have to pay at least 20 per cent. of the poll tax. There is nothing in the Budget to give them hope. The Chancellor should have remembered that, in this great nation of ours, the fathers and grandfathers of the adults of today took part in two world wars, but they are on the lowest pensions in Europe. That is disgraceful; financially, we treat our pensioners worse than any other European country. Why did the Chancellor not take the opportunity to do something for our pensioners?
  Another major group that the Chancellor missed were the homeless. We have discussed their problems week after week in the Chamber. We toss around ideas occasionally about what is being done in the inner-city areas for the homeless. I must say to Conservative Members that, at the moment, that is very little. Much has been said before the Budget and since about what the Government should do for building societies to help those with mortgage problems. They should act, but that should not be the only major thrust of a Budget. One million or so people are supposed to be registered as homeless in Britain—that figure has been quoted by many organisations.
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  Instead of considering building societies, why did not the Chancellor go to his right hon. Friend the Secretary of State for the Environment and say that he would create more money for the market to help with the problem of homelessness by allowing local authorities to spend the millions of pounds that they have acquired through the sale of council houses—but which they are not allowed to use—to build council houses again? If the Government want to sling around a few hundred million pounds or £1 billion—about £2 million to each district authority—50,000 council houses could be built, which would take at least 100,000 people off the homeless list immediately.
  There are many things wrong with this Budget. It is not only a poor Budget, but a Budget of missed opportunity. It is a juggler's Budget—the Budget of the son of a juggler—and nothing useful will come out of it. All that will happen is that some of the juggling balls that the Chancellor chucked into the air will be remembered in the next 12 months when many of them hit the ground. The people will remember the lost opportunity of this Budget. I am sure that at the next general election, in a year or less, they will prove that they remember by removing the Government from office.
  Mr. Riddick: On a point of order, Mr. Deputy Speaker. I believe that the hon. Member for Normanton (Mr. O'Brien) criticised me for leaving the Chamber after about 10 minutes of his speech. I do not know whether there is a convention that says that I should have stayed for the entire speech; if so, I apologise. However, the hon. Member for Normanton did not stay for more than 10 seconds of the speech of his hon. Friend the Member for Mansfield (Mr. Meale). That is gross hyprocrisy.
  Mr. Deputy Speaker: Order. I am sure that, on reflection, the hon. Member for Colne Valley (Mr. Riddick) will wish to withdraw his last remark and rephrase it.
  Mr. Riddick: Is that unparliamentary, Mr. Deputy Speaker? If so, I say instead that it was a clear case of double standards.
  Mr. Meale: On a point of order, Mr. Deputy Speaker.
  Mr. Deputy Speaker: Order. Of course I will take points of order, but a phrase has been withdrawn. The House always accepts that, and I hope that the matter will not be pursued.
  Mr. Allen McKay: It will not be pursued, Mr. Deputy Speaker, but if the hon. Member for Colne Valley (Mr. Riddick) had asked me why my hon. Friend the Member for Normanton (Mr. O'Brien) had left, I would have told him.
  9.9 pm
  Mr. Paul Boateng: I begin by adding my congratulations to those of my right hon. and hon. Friends to the Chancellor for the manner in which he presented his Budget. His presentation was pleasant. It was in marked contrast to, indeed free from, the bullying and bombast that characterised the presentations of his predecessor. The problem was that his speech was free of much else, too: free of any content capable of effectively altering the current dismal state of the economy; free of anything that addressed the issue of interest rates or inflation, which is nudging 9 per cent. and will soon be 10 per cent; free of

  1197
  anything that sought to deal with the current crisis of an all-time low level of manufacturing investment; free also of anything that sought adequately to tackle what the right hon. Member for Chesham and Amersham (Sir I. Gilmour) described as the horrendous deficit that currently afflicts our balance of payments.
  The political circumstances in which this debate takes place, and in which the Budget was delivered, demanded a Budget for Back Benchers. That is precisely what we got. The City analysts cried out for a Budget for the City. They did not get that. The nation cried out, in its need, for a Budget for the country. That was not forthcoming. There was no relief for home owners, no relief for those who, day in day out, have to face the reality of high interest rates. There was no relief for those in manufacturing industry who seek at this time the means, the wherewithal, to promote the investment that they know is so vital if we are to be competitive in the international marketplace. They found little, if anything, of comfort to them. There was no immediate prospect of a fall in the rate of inflation. This was not a Budget for the country.
  It was to a very large extent a damnable budget. I see that the Financial Secretary to the Treasury is a little perturbed by my use of the word "damnable". I use it advisedly. The Chancellor was in this dilemma: he was damned if he did, he was damned if he did not, and he was damned if he knew what to do. That shone through his Budget. The consequences are to be seen in this evening's newspapers. Opposition Members take no joy in this headline:
  "Budget Blues Savage the £
  Defiant Major"—
  defiant already, after less than 48 hours—
  "insists: It was tough enough".
  As I have said, we take no joy in that headline. We do, however, take considerable interest in what the chief economist of Union Discount, Mr. Nicholas Parsons, has to say.
  The Chief Secretary ought to pay a little attention to what people in the City say. Not long ago he and his colleagues were telling us that the market was the depository of all wisdom. Do hon. Members remember that? Do they remember Ministers coming to this House and, day in day out, thrusting down our throats that we ought to listen more to the market? Well, let them now listen to the market. Let them listen to what the market says about the Chancellor's Budget:
  "He hopes inflation will come down but he hasn't got a plan."
  That, I fear, says it all—he is damned if he knows what to do.
  Throughout the past decade the Government have made obeisance before two altars: the altar of dogma—I see that that brings a look of recognition into the eye of the Chief Secretary—and the altar of expediency. I see that that brings a look of recognition into the eye of the Financial Secretary. Over the years, he has had to learn about expediency. He will have to learn still more about expediency before the next 24 months are out.
  We must not be too hard on the Government. There has been some progress and we must celebrate it: the hard passage from making a fetish of monetarism to a fixation on interest rates. One only has to look at the Red Book to chart that progress. It makes fascinating bedtime reading,
  1198
  which I commend to both hon. Members and the nation. This year, interestingly, it begins with a little homily about the medium-term financial strategy and it seeks to explain to those poor souls who are mystified by the subject the significance and importance of monetarism.
  It is worth looking at the individual letters and words in the Red Book and at what the Chancellor of the Exchequer had to say. Let us use the one to lead us on to the other. The Chancellor's words are interesting and worthy of note. To those of us who pay attention to these matters they suggest a distinct shift. The Chancellor said yesterday:
  "although monetary policy remains the key"—
  note the word "key"—
  "to controlling inflation, it is not realistic to suppose that we can take decisions solely by reference to the way any one particular measure of money is growing. In"—
  wait for it—
  "a more sophisticated world, we must apply judgment and take into account the evidence about monetary conditions that may be available."
  Is it not wonderful how, during the past 24 months, the world has suddenly become more sophisticated? I wonder whether it has anything to do with the Chancellor's brief sojourn in the Foreign Office? Suddenly he has discovered that the world is a more sophisticated place than he thought it was when he was Chief Secretary. He went on:
  "I have looked afresh at the role of monetary targets. Having done so, I am clear that it is sensible to retain a target for narrow money, and that this is best measured by the familiar aggregate MO. Since this is essentially notes and coin,"—[Official Report, 20 March 1990; Vol. 169, c. 1013.]—blah, blah—we have heard it all before.
  The significance of that passage becomes all too clear when it is related to the Red Book, where one can see that a number of hands have been at work. The Chief Secretary had a bit of a nerve to chastise us with the words of Mr. Samuel Brittan. He always makes a good read, and occasionally one agrees with one or two of the things that he says. Before the Chief Secretary quotes Mr. Brittan to us, perhaps he should read a little more carefully what he has to say about the Chancellor's speech and the Red Book.
  He defines two sets of hands at work in writing that homily. Mr. Brittan has done rather a good job. First, he finds the hand of someone who he describes as "Author A" who gives
  "a straightforward textbook account of the virtues of monetary policy, arising from the ability to move interest rates quickly in either direction in response to"
  the needs of the time. He then finds the hand of "Author B" who "reads much more like" the Chancellor
  "and even more his next-door neighbour".
  So there are now three sets of hands at work, two of them indistinguishable, one from the other, and the other some wretched Treasury mandarin given the hapless task of stating an authorised line.
  Mr. Brittan goes on to point out a problem that Ministers face:
  "Ministers are happy to explain why they cannot reduce interest rates very soon. But they shy away from the prospect that they may have to move them upwards."
  Mr. Budgen: Hear hear.
  Mr. Boateng: I hear the hon. Member for Wolverhampton, South (Mr. Budgen) say, "Hear, hear." His voice is always welcome in these debates and I shall refer briefly to what he had to say. I know that the Chief Secretary dreads to hear the familiar voice of the hon.

  1199
  Gentleman. He leads what I would describe as the disaffected monetarist tendency of the Conservative party. He can be found at every committee meeting and, no doubt, at every Back-Bench meeting, grumbling away at the laxity of successive Chancellors. Who can blame him? He must be living an absolute nightmare as one of the last few remaining committed monetarists to be found anywhere, let alone on the Conservative Back Benches. There are certainly none to be found on the Government Front Bench, where, if any existed, they have long since been silenced, although Ministers continue to pay the ritual obeisance to the gods of montarism.
  It must be heartbreaking for the hon. Member for Wolverhampton, South-West to be obliged to endure the Chancellor's speech, but he was very gracious and it is fair to him to say that he partially pardons the Chancellor for the excesses of the period when he was Chief Secretary. The Chief Secretary and the Financial Secretary are in a real dilemma from which they will not find an easy escape.
  Mr. Julian Brazier: The hon. Gentleman started with a most interesting hellfire homily and is now steadily working through in some detail one or two of the minutiae of Mr. Brittain's and other views of Government policy. Is he planning at any time in his speech to touch on Labour economic policy, as the House is anxious to hear about that?
  Mr. Boateng: I am glad to find such eager anticipation on the part of the hon. Gentleman for what will be the heart of my speech. So let us get to it now.
  Let us move from the ju-ju economics of the monetary system—the Chancellor knows as much about ju-ju as I do—to another difficulty for the Government, which causes us no difficulty—our entry into the exchange rate mechanism. [HON. MEMBERS: "Ah."] That is welcomed by Conservative Members, but not so much by some Ministers. The Chancellor's hands are tied on our entry into the ERM, but it causes us no problem because we believe that, following negotiations to preserve Britain's best interests, it is vital to preserve and to develop——
  Mr. Moss: When?
  Mr. Boateng: As soon as possible after the election of a Labour Government, so anything between 18 to 24 months. I know that that will be of some comfort—[Interruption.] I said "after appropriate negotiations". [HON. MEMBERS: "Ah."] That is no secret. We believe in negotiating for Britain, in sticking up for British manufacturing and in creating a climate to promote investment in manufacturing industry to provide the stability that will be vital. The Chancellor failed to tackle that in his Budget.
  Mr. Riddick: Will the hon. Gentleman give way?
  Mr. Boateng: No, not at the moment. I am coming to the heart of Labour party policy.
  We do not believe that entry into the ERM is an easy panacea, a magic potion or an elixir. We see it as part and parcel of the context in which we shall carry out our economic policy, which will be based on recognition of the importance of training and of research and development. The Budget has tinkered with training in such a way as to produce a bribe to make employers co-operate with a
  1200
  training scheme that is not satisfactory and is grossly underfunded. We do not believe that that is the way forward.
  We believe that we should place emphasis on training and on research and development. Our industrial policy will create a firm and sound infrastructure for British industry, which will be vital if we are to go forward and to reverse the disastrous decline in British industry in recent years. The right hon. Member for Chesham and Amersham gave the figures earlier, and they were an indictment. Manufacturing output in France increased by 19·5 per cent. between 1973 and 1989, by 21 per cent. in Germany, but by 8·9 per cent. in Britain. We believe that we can and will do better under our industrial policy, which was outlined by our chief economic spokesman, my right hon. and learned Friend the Member for Monklands, East (Mr. Smith).
  Even the right hon. Member for Henley (Mr. Heseltine) recognises the importance of an industrial policy. Conservative Members should begin to recognise its importance, too, or they will find themselves in much difficulty.
  Mr. Riddick: Will the hon. Gentleman give way?
  Mr. Boateng: Not at the moment.
  It is important to recognise the pool of skills and the commitment to enterprise among women workers. The Budget contained grossly unsatisfactory measures for women. That was clearly shown by the useful and important speech of my hon. Friend the Member for Glasgow, Maryhill (Mrs. Fyfe). If the Government want to help women, they must do something about a system in which only I per cent. of our children have the opportunity of education for the under-fives. We fall behind our competitors in France and Germany with nursery provision. We should be spending the money on that.
  Miss Ann Widdecombe: Will the hon. Gentleman give way?
  Mr. Boateng: The hon. Lady has not been here at all during this debate and I do not intend to give way to her now. She will know the importance of ensuring that child benefit is available to mothers whether they work or not.
  If the Government cared about alleviating poverty, closing the employment gap and tackling the issues that make women and children disadvantaged, they would upgrade child benefit. They have consistently failed to do so. The Government could pay for that and restore cuts in research and development and training out of the £800 million that the abolition of stamp duty on share trading has cost the Exchequer. The Government did not. introduce environmental measures which are essential to sustainable economic growth. We must care for our climate and create the context in which it is possible for the nation to grow and for the industrial sector to expand without disadvantage to the environment.
  There should have been proposals in the Budget for negotiations with our EEC partners on a more satisfactory use of VAT as a mechanism. We should have heard about capital allowances for clean technology, but we heard nothing. We heard nothing about capital allowances, for which the Trades Union Congress and the Confederation of British Industry have called, to assist manufacturing industry. The Budget was not about sustaining and developing the economy. It was not geared to those ends.

  1201
  That is our vision of the economy. It empowers and enables the worker, the consumer and the industrialist to build up our economy. That is the way forward. We are not talking about something that is opposed to enterprise. Our vision of enterprise Socialism puts enterprise at the forefront. We believe that it is important to grow, that we must increase the size of the cake and that we must welcome a system in which the economy grows and in which there is enterprise and initiative, because that is the way to improve the lot of all.
  I realise that that is heresy to the Government. They find it difficult to grasp, but they find the needs of these times difficult to grasp. The Budget misses every opportunity. It is not a Budget for the times or the nation. We will give the nation just such a budget, and soon.
  9.33 pm
  The Financial Secretary to the Treasury (Mr. Peter Lilley): We warmly welcome the hon. Member for Brent, South (Mr. Boateng). We enjoyed his speech, which I believe was his first contribution in winding up in a Budget debate. That is not to say that we do not miss the billed performance of the hon. Member for Islington, South and Finsbury (Mr. Smith), who we understood would wind up the debate for the Opposition. We understand why he has not done so. He would have been reluctant to defend the budget of his constituency in Islington——
  Mr. Boateng: The hon. Gentleman has the wrong speech.
  Mr. Lilley: It is not. The hon. Member for Islington, South and Finsbury would have been reluctant to defend a budget that, we are told, involves £68 of poll tax for every citizen of Islington, which was spent on a list of 300 dole-outs.
  I was asked to raise this matter by an inhabitant of Islington whom, being Irish, is particularly insulted that Irishmen are to get a grant of £100,000 and Irishwomen a grant of £45,000. I also want to inquire about the Anglo-Akanthou Aid Society, which is to receive £46,788. Who are the Akanthou, we ask ourselves?
  Mr. Chris Smith: Perhaps the Financial Secretary would like to reflect on the fact that every organisation listed in the article in The Sun from which he is quoting is funded by the London borough of Islington under partnership arrangements, in which 75 per cent. of the funding comes from the Department of the Environment. They are agreed and approved by the Department and presumably by the Treasury.
  Mr. Lilley: Nevertheless, the total of £8 million still represents a huge increase in the average poll tax of every citizen in Islington. The hon. Gentleman is clearly ashamed and would dissociate himself from the large sums being squandered in his borough in this deplorable manner.
  I shall respond to a number of the queries that were raised during the debate before going on to the main measures that my right hon. Friend the Chancellor introduced in his Budget. The hon. Member for Londonderry, East (Mr. Ross) asked whether the capital
  1202
  disregard measures announced in the Budget would apply in Northern Ireland and to Northern Ireland ratepayers. I can assure him that they will.
  The hon. Member for Blyth Valley (Mr. Campbell) asked why the latest figures for those affected by the community charge differ from those that he has received in reply to an earlier question. The answer is that the level of overspending—as illustrated by the London borough of Islington—has increased considerably since the earlier estimates were made. As a result, larger sums are being made available to those who benefit and more people come within the range of potential benefits—[Interruption.] Opposition Members are clearly extremely nervous of associating themselves with Islington borough council, and I can well understand it. Not one of those items of expenditure did they seek to justify. [Interruption.]
  Mr. Speaker: Order. The House should settle down.
  Mr. Lilley: I come now to the main measures in the Budget. They must be seen against the background of two major measures announced in previous Budgets that will come into full effect only in the current year. The first is the national insurance contributions reform, which was announced in the last Budget but which came into force only last October. This will be the first full year in which people will benefit from it. It removes an insurmountable hurdle of steps in the progress of national insurance contributions which effectively amounted to a tax of more than 100 per cent. at certain steps of the income progression of those earning less than £115 a week. For 15 million people earning more than £115 a week, it represented an increase of £3·20 net extra in their pay packets, which all have been enjoying since then. More than three quarters of those 15 million people—who Opposition Members appear to treat with disdain—earn less than the average male earnings in this country.
  The second of the tax measures that had already been announced was the introduction of independent taxation. That gives complete privacy and independence to women for the first time since income tax was introduced by William Pitt the younger two centuries ago. The introduction of independent taxation costs a lot, but that is a measure of the injustice which the old income tax system perpetrated on women, and which past Labour Governments were willing to tolerate.
  About 3·75 million people will benefit from the extra money, of whom 70 per cent. have incomes of less than £10,000 a year. About a third of the gainers are elderly and will gain an average of £350 each. About four out of five of the taxpaying elderly will benefit from independent taxation, not to mention all those with savings whose level of income, from savings and otherwise, is below the threshold.
  My hon. Friend the Member for Torridge and Devon, West (Miss Nicholson) and the hon. Member for Glasgow, Maryhill (Mrs. Fyfe) asked whether the married couples allowance could be made divisible between husbands and wives. My right hon. Friend and I have looked carefully at that. My right hon. Friend concluded that, although it might be desirable in principle—all of us can see the attraction of the principle—it would be impossible to introduce it without delaying the introduction of independent taxation for a further two years.
  Even if we were to give everybody the option to choose how the married couples allowance should be divided

  1203
  between husband and wife, millions more households would have to fill in tax forms. If there was a disagreement between a husband and wife about how it would be divided, the Revenue would have to sort out intractable problems. Obviously it would have been unfair if the allowance were rigidly divided between the two without any opportunity for them to transfer it between them. At present the husband can transfer it to the wife.
  Therefore, although I understand the attractions of the measure that has been urged upon me by the two hon. Ladies, that measure is not administratively possible and it would not have been worth delaying for two years the extremely desirable introduction of independent taxation.
  The savings element of the benefits of independent taxation naturally draws attention to the operation of composite rate tax. It highlights the injustice that composite rate tax has long perpetrated on small savers and low-income savers whose incomes are below the normal tax threshold but whose savings were taxed and who could not reclaim that tax. That has been going on in some form or another since the 19th century, although the composite rate of tax was put on the statute book by Stafford Cripps after the war.
  Composite rate tax had many virtues. It was an efficient, cheap and simple system with just one disadvantage—it was unjust. Therefore, we decided to do away with it, as my right hon. Friend the Chancellor announced yesterday. That measure will benefit 14 million savers, of whom 5 million are women, 4 million are pensioners, 2·5 million are other adults and 2·5 million are children.
  One reason that composite rate tax has not been abolished before is that its abolition is costly and administratively difficult. Administrative problems will be created in implementing the new system. However, after rightly pointing out those problems to us, the Inland Revenue has responded with immense vigour to the challenge that our decision to abolish CRT has given it. I want to pay tribute to the Inland Revenue and to those who work there for the vigour, imagination and energy that they are putting into forcing this measure through as rapidly as we intend so that the provisions can begin on 1 April next year.
  The hon. Member for Beith—[Interruption.] I am sorry, I mean the hon. Member for Berwick-upon-Tweed (Mr. Beith), who is not as eponymous as I made him sound—asked whether we could abolish CRT earlier and simultaneously with the introduction of independent taxation. The introduction of independent taxation was a major and immense task. Abolishing composite rate tax will also be an immense task. It would not have been possible to do both simultaneously. To do the two in series as rapidly as we are is an achievement of which the Inland Revenue can well be proud.
  Likewise I pay tribute to the Inland Revenue on developing the tax-exempt special savings account—TESSA. A number of my hon. Friends have already paid tribute to the simplicity and flexibility of the proposal. In the past the Inland Revenue has often been accused of burdening good ideas with complex rules, but if hon. Members look closely at TESSA they will find that that is not the case. She is a simple, straightforward soul, and she will be attractive to savers and institutions, which I believe will make such accounts widely available.
  A battery of other measures to benefit savings have been introduced. They have been praised by my hon.
  1204
  Friends the Members for Somerton and Frome (Mr. Boscawen) and for Bridlington (Mr. Townend). My hon. Friend the Member for Fylde (Mr. Jack) also welcomed those measures and asked me to emphasise the continuing role of the Department for National Savings. That was highlighted in my right hon. Friend's Budget speech by his decision to raise the rate of interest on a number of national savings products. My hon. Friend will be aware of the excellent job performed by employees of the Department for National Savings in his constituency and in a number of other constituencies, for which we are grateful.
  The Government believe that savings are immensely important for individuals and for the nation. Opposition Members pay lip service to investment, but every pound of investment ultimately needs a pound of savings to finance it. Investment as a proportion of our national income is already running at a record level, but we need to maintain through the 1990s a high level of savings to finance that continuing high level of investment. That is why we have taken the measures to promote and encourage a culture of savings and thrift.
  Because of the measures that my right hon. Friend announced, he has been dubbed by the press as the small savers' friend. That is indeed true. The Labour party, by its attitude, exemplifies the fact that it has always been, and always will be, the enemy of savers. It is their enemy because inflation destroys savings and the Labour party has always let inflation rip. The policy objectives described by various Opposition Members today suggest that they would let inflation rip once again. The Labour party is a party of spending, not saving, and it is excessive spending that generates inflation.
  The Labour party used to operate the investment income surcharge—a tax on what Opposition Members derided as unearned income. However, we have recognised that income as income from savings. The Labour party, to its eternal shame, allowed that tax to run up to 98 per cent.—and it voted against its abolition.
  A number of myths have been raised in the debate, one by the hon. Member for Clydebank and Milngavie (Mr. Worthington). He suggested that this country no longer makes manufactured goods and that we import disproportionately more than we produce. The level of import penetration in this country is not out of line with that in other major countries. It is rising in this country, but it is also rising in other major countries because international trade is rising internationally. As that happens, it is inevitable that countries spend more on other people's goods because other people are spending more on theirs.
  I look around my constituency and note the products that we manufacture of which I am proud. We manufacture aircraft, testing equipment and hi-fi recording equipment, largely for sale to Japan for use by the recording industry, not private individuals. We manufacture street cleaning and other environmental equipment, all of which is exported in large amounts, but none of it, of course, purchased in the shops. Those sales enable us, through the foreign exchange that they earn, to purchase goods in the shops. The hon. Gentleman should not be disappointed as he failed to see the things that we produce in the shops.
  Mr. Worthington: Will the Minister give way?
  Mr. Lilley: I shall happily give way to the hon. Gentleman to give him an opportunity to withdraw the slurs that he cast earlier.
  Mr. Worthington: I certainly shall not withdraw the slur; I may well add one or two. I shall quote from what the Minister said last year about the balance of payments, and ask whether it is still the Government's position. Last year he referred to meeting the foreign financial press corps who grilled him about every aspect of British economic policy.
  "They concentrated on inflation and every aspect of the Budget; only at the very end of the evening did one person mention the balance of payments and balance of trade. They have their priorities right, and the Opposition should learn from them."—[Official Report, 16 March 1989; Vol. 149, c. 627]
  Is that still the Government's attitude towards the importance of the balance of payments?
  Mr. Lilley: Of course it is, and I withdraw not a word. Earlier the hon. Gentleman said that I had denigrated manufacturing industry and said that it was not important. He said that I attached far more importance to the service industries. I have never said any such thing. I asked him to find any reference to them and I asked one of my hon. Friends to look through the speech last year to which the hon. Gentleman referred. There is no such statement. He also looked through all the speeches in the Finance Bill Standing Committee, and there is no reference to me speaking about manufacturing during those debates. I was not involved in manufacturing because I was talking about other issues. If the hon. Gentleman wishes to provide the House with a text, he is quite welcome to do so, and I shall naturally accept it. I have always thought that the hon. Gentleman was a reasonably honest individual.
  Mr. Worthington rose——
  Mr. Lilley: I shall give way if the hon. Gentleman wishes.
  Mr. Worthington: The goods that can be exported——
  Mr. Lilley rose——
  Mr. Speaker: Order. The Financial Secretary has given way.
  Mr. Worthington: The Government have paid inadequate attention over the years to manufacturing industry, whose products can be exported. Goods and services, particularly financial services, cannot be exported in the same way. The Minister says that the balance of payments is not important. That is a direct statement that manufacturing industry is not important.
  Mr. Lilley: That is absolute twaddle. I have always said that, as far as the balance of payments reflects an inflationary, excessive demand in this country, inflation being the priority and the balance of payments being the symptom of it, it is important. I am sorry that the hon. Gentleman did not choose to withdraw or substantiate his earlier slurs. I know that he was for a period an inmate of a borstal. I am sorry that he learned more from its inhabitants than he was able to teach them.
  Mr. Worthington: On a point of order, Mr. Speaker.
  Mr. Lilley: I shall not give way. No point of order arises from what I said.
  Mr. Speaker: Order. I am afraid that I have to decide that.
  Mr. Worthington: On a point of order, Mr. Speaker. That is a slur. For four years I was a member of staff of a borstal, not an inmate. I hope that the Minister will withdraw his remark.
  Mr. Speaker: Perhaps the Minister will put a different interpretation on what he said.
  Mr. Lilley: When you, Mr. Speaker, are even-handed in your search for the truth on this matter, perhaps I will.
  Mr. Speaker: Order. What does the Minister mean by that?
  Mr. Lilley: Earlier today you, Mr. Speaker, said that you were sure that any allegation mady by the hon. Member for Clydebank and Milngavie was right. Now you are asking me to withdraw a perfectly fair, knockabout statement——
  Mr. Speaker: Order. I am not having that from the Minister, who knows that I had then been in the Chair for two minutes, and I apologised to him because I had not heard the arguments that had gone before. He cannot sustain that argument. Furthermore, I am now asking him to rephrase what he said. There is a difference between being an inmate and being on the staff.
  Mr. Lilley: Of course, in that case I shall say that the hon. Member for Clydebank and Milngavie was on the staff of a borstal and, as I said, during his period there he clearly learned more from his fellow inhabitants of the institution than he was able to teach them.[Interruption.]
  It is clear from every contribution made from the Opposition Benches—I am glad about this, although Opposition Members are getting a little rowdy now—that they welcome every measure in the Budget since they have not criticised any of them. They clearly recognise the skill of my right hon. Friend in framing his Budget.
  They have been less forthcoming about what they would do. They have made it pretty clear that they would like to see higher spending on a range of different items. They want a Budget for spenders, not for savers. But when they are asked which of their promises amount to firm commitment, they become rather shifty and evasive; and when they are asked how they would finance their spending pledges, they shut up like clams.
  I risk a rebuke from Opposition Members because I know that they have dissociated themselves from their comrade, Mr. Scargill, but I cannot help feeling that they are adopting a policy similar to what might be called Scargill economics: they will not say where the money is coming from or where it is going to, they deny that they would ever touch a penny of their members' or, in this case, ordinary citizens' cash, but at the same time they promise to dish it out discreetly to their friends. It seems as if Scargill economics has become the new orthodoxy of the Labour movement.
  Unfortunately, like their friend, the Opposition have a few friends who have grassed, so we know a number of elements of their package. They would, for example, put the top rate of tax back to 50p in the pound, which would hit some 1·7 million taxpayers. They would abolish the earnings limit on national insurance contributions, effectively putting a 9p in the pound tax on earnings over £17,000, which would hit 3·8 million taxpayers. They

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  would phase out the married couples allowance, which would hit some 12 million households. They would restore the investment income surcharge, or something like it, on savings, which would hit at least 20 million savers. Finally, they would impose a roof tax, rising every year with the value of one's home and effectively incorporating a local income tax, which would hit the best part of 15 million households.
  I want to make it quite clear that there is some overlap in those numbers. One should not just add them up and assume that all those people would be hit. A number would be hit several times by several of the taxes and some would be hit by all five taxes that Labour proposes. Yet those taxes alone would not raise enough to finance a fraction of what has been implicitly promised today.
  As Opposition Members will not tell us how they will raise taxes from the rest of the population to finance that extra spending, so we must look back at their record. I am reluctant to do so, but if they will not tell us we must deduce what they will do from what they have done. I look back at the 1976 White Paper on public expenditure, when the right hon. Member for Leeds, East (Mr. Healey) spelled out the position very clearly:
  "The ratio of public expenditure to gross domestic product has risen from 50 per cent. to 60 per cent. … The tax burden has also greatly increased. In 1975–76 a married man on average earnings is paying about a quarter of his earnings in income tax, compared with a tenth in 1960–61. At two-thirds average earnings, he is paying about a fifth compared with less than a twentieth. Tax thresholds have fallen sharply in relation to average earnings"—
  this is under a Labour Government—
  "and people are being drawn into tax at income levels which are below social security benefit levels. The increase in the tax burden has fallen heavily on low wage earners. Those earning less than the average contribute over a quarter of the income tax yield. This cannot be made good simply by increasing the burden at the top: if no taxpayer were left with more than £5,000 per annum after tax"—
  1208
  in present-day money that is £15,600—
  "this would increase the yield by only about 6 per cent."
  In other words, as the right hon. Member for Leeds, East found then, and as any future Labour Chancellor, if ever there were one, would find, their programme could be financed only by taxing people down to levels below the level of social security benefit. That is why Labour Members are so quiet, shifty and evasive when it comes to answering questions about their tax policies.
  The right hon. and learned Member for Monklands, East (Mr. Smith) has had plenty of opportunities to spell out his tax proposals, but he has remained quiet. The measures will not succeed, as they proposed, in solving their problems, so they have to do worse elsewhere. Labour Members want us to forget their record. They are worse than the Bourbons—
  It being Ten o'clock, the debate stood adjourned.
  Debate to be resumed tomorrow.

  PROCEDURE
  Ordered,
  That Mr. Nicholas Bennett be discharged from the Procedure Committee and Mr. Paul Channon be added to the Committee.—[Mr. Dorrell.]

  EMPLOYMENT
  Ordered,
  That Mr. William Cash be discharged from the Employment Committee, and Emma Nicholson be added to the Committee.—[Mr. Ray Powell, on behalf of the Committee of Selection.]

  FOREIGN AFFAIRS
  Ordered,
  That Mr. Ian Taylor be discharged from the Foreign Affairs Committee, and Mr. Nigel Forman be added to the Committee.—[Mr. Ray Powell, on behalf of the Committee of Selection.]

PETITIONS

  Humberstone (Development)
  10 pm
  Mr. Keith Vaz: I wish to present a petition on behalf of Dr. Margaret Scott of 8 Vicarage lane, Humberstone, Chris Mauglan of 4 Vicarage lane, Humberstone and Dr. Roger James of 25 Stanley drive, Humberstone and 350 other local residents who are protesting about the proposed Jelson's development in Humberstone village. The city council refused planning permission before the development, but the developers, by their actions, destroyed the wildlife of the land and bulldozed it. The petition states:
  Wherefore, your Petitioners pray that your Honourable House encourage the Secretary of State for Environment to uphold the decision of the Leicester City Council which in December refused Jelson's building proposal. And your Petitioners, as in duty bound, will ever pray.
  To lie upon the Table.

  Eye Test Charges
  Mr. Vaz: I wish to present a petition on behalf of 105 residents of Leicester who are deeply concerned by the introduction of eye test charges and they correctly say that people are being forced to go without treatment because of these charges. The petition has a sad history because it was collected by Mr. Edwards an optician, who lived at 67 Marston road, Leicester, but who has died since the petition was given to me.
  The petition states:
  Wherefore, your Petitioners pray that your Honourable House encourage the Secretary of State for Health to abolish these charges immediately so that ordinary people may have the proper treatment they deserve.
  To lie upon the Table.

  Christian Broadcasting
  Mr. Vaz: I wish to present a petition on behalf of Mrs. Mills of 6 Hoylake close, Leicester and 60 other residents, who are members of Evington chapel, High street,
  1210
  Evington, who wish to keep broadcasting channels open for existing levels of Christian broadcasting. They call on the Secretary of State for Home Affairs to ensure that there is sufficient means by which Christian broadcasting is retained within our broadcasting service.
  To lie upon the Table.

  Dogs
  Mr. Vaz: My final petition is on behalf of Mrs. Igmar Dobson of 11 Stanley drive, Humberstone, Leicester and 4,000 local residents. They request new legislation to make dog owners responsible for training dogs, to introduce a dog registration scheme and to ensure that there is full control of dogs in public places.
  I declare an interest as the president of the Leicester and South Leicestershire branch of the Royal Society for the Prevention of Cruelty to Animals. I feel that these measures are extremely important.
  To lie upon the Table.

  Human Embryos
  Mr. Andrew Hargreaves: I beg to ask leave to present a petition on behalf of Mr. Keith A. Davies of 50 Eastham road, Billesley, Birmingham B13 and some 487 of my constituents, being all parishioners of Our Lady of Lourdes church, Yardley Wood, Birmingham, on the subject of the protection of the human embryo, on which I here venture no opinion either in agreement or dissent:
  Wherefore your Petitioners pray that the House of Commons will take immediate steps to enact legislation which (a) forbids any procedure that involves purchase and sale of human embryos, the discarding or freezing of human embryos, their use as sources of transplant tissue or as subjects for research or experiment (unless this is done solely for the benefit of the embryo concerned); and (b) forbids all forms of trans-species fertilization. And your Petitioners, as in duty bound, will ever pray.
  To lie upon the Table.

  Coastal Defences
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Fallon.]
  10.6 pm
  Mr. Jonathan Sayeed: I do not know the financial cost of what happened in Towyn, north Wales, on 27 February, although the human cost and misery were clear for all to see. But I do know that restoring the town will cost hundreds of times more than the remedial work on the sea wall would have cost.
  That single storm, despite the fact that the winds were not that severe, brought havoc throughout the coastal areas of the west. In Cornwall, Devon, Weston-super-Mare, Wales and further north, it taught us that a combination of wind, tide, rising sea levels and decaying sea defences will wreak such destruction that the money saved by doing next to nothing will rank as infinitesimal compared with the cost of the damage caused.
  Under constant attack from the effects of wind, wave and tide, our coastline is being eroded and urgent action is necessary to avoid the loss of land, property and life. Yet since the storms of 1953 and the subsequent construction of sea defences on the east coast, there has been little major coastal protection work. Even those east coast defences are nearing the end of their useful life and require extensive repair or replacement. Sea wall construction costs on average £5 million a kilometre. About £150 million will have to be spent in the Anglian region alone over the next 10 years just to maintain the current level of protection, with £450 million being the estimate for the United Kingdom over the same period.
  Yet even that is an underestimate, as the little evidence that is available clearly shows that the effect of rising sea levels and changing weather patterns threaten larger areas of our coast with increased destruction. But no one knows how much or how soon or at what cost.
  Sea levels are variously predicted to rise between 0·2 m and 1·65 m by the middle of the next century, and storm patterns are expected to change for the worse. The latest assessment of predicted sea level rise now varies between 25 cm and 40 cm. No one can tell with certainty what will he the consequences. The Ministry of Agriculture, Fisheries and Food has produced a map that clearly shows that about 750,000 hectares, of which some 200,000 is prime agricultural land, are below the 5 m ordnance datum. In other words, that area could at any time be inundated at present possible storm water levels. if one makes a modest estimate of the average value of the land, buildings and contents at £100,000 a hectare, the value of the property currently under threat, even without sea level rises and climate change, is £75 billion.
  It is true that Durham university is investigating the impact of sea level rise, but the study is directed towards the methodology of establishing the impact rather than assessing the cost, although the Ministry of Agriculture, Fisheries and Food has a research project at the university of East Anglia entitled "the economic appraisal of the consequences of climate-induced sea-level rise", that is at an early stage and there have been several suggestions that it is inadequately funded.
  Even when coastal protection and building works are undertaken, they are too often undertaken in an
  1212
  unco-ordinated and haphazard manner, and in cones-quence their operation frequently increases the risk to an adjoining area.
  The responsibility for the protection of the coastline is divided among 240 different authorities. Coastal work such as groynes, piers and harbour entrances are frequently carried out by individual authorities without due consideration being given to the effect on the coastal regime of an adjacent authority. Consequently, it often causes severe accretion or erosion problems by interfering with the movement of beach material.
  My hon. Friend the Minister will no doubt tell me, and he will be correct to do so, that action has been taken to ease the position through the establishment of 10 regional coastal groups involving 72 authorities. But co-ordination of coastal construction and coastal protection on a national basis is essential if effective protection is to be achieved. My hon. Friend will know that few coastal authorities talk to one another about common problems, and the newly formed regional coastal groups have not even met.
  We need a single body to co-ordinate the monitoring of water, wave, beach and sea bed levels to provide the support for research and design methods, and hence the forms of construction. The same body should advise on national priorities and approve local proposals. As the National Rivers Authority is already responsible for the general supervision of sea defences, it would seem reasonable that its remit should be extended and its funding increased to cover the whole coastline.
  With the Coast Protection Act 1949, the Land Drainage Act 1976, the Crown Lands Act 1866, the Wildlife and Countryside Act 1981, the Sea-Fisheries Regulation Act 1966, the Control of Pollution Act 1974, the Prevention of Oil Pollution Act 1971, the Dumping at Sea Act 1974, the Customs and Excise Act 1952, the Highways Act 1959, and the numerous private Bills and railways Acts all affecting the coastal zone, there is a clear need to establish legislation to provide a coherent and comprehensive policy for dealing with interests there.
  It is also essential that funding is provided and research co-ordinated to develop appropriate design and construction methods. Too little data are available to predict reliably the future effects of wind, tide and sea levels on existing sea defences. But we can already be clear that the rise in sea levels coupled with more severe storm conditions will result in the need to spend between £5 billion and £8 billion to deal with the increasing threat.
  East Anglia appears to be in immediate danger, but many parts of the south and west coasts need urgent attention. However, we do not know where to start. Apart from the Anglian sea defence management study, hardly any monitoring is taking place. But research is essential if we are to do what is necessary in the time we have and a t the most effective cost. Research into the inshore wave climate, the combined probability of high wave and water levels, the co-ordination of wave data acquisition, research into beach stability and provision of instrumentation to obtain field data and the collection and collation of those data to verify the predictions of mathematical models of sediment transport, wave refraction and diffraction should be taking place now. Research is essential in the full-scale monitoring of the coastal structure, and we must interlink field and laboratory experiments to investigate the physics of sediment transport.

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  We have 4,026 km of coastline, but only 23 per cent. is protected by concrete walls or steel sheet piling; 12 per cent. is protected by the soft-edge solution—essentially grass banks—leaving 65 per cent. in its natural state. As conditions become more severe, a greater length of coastline will require protection against flooding and damage. However, as coastal protection work is a long-term activity, there is an overwhelming need to take action now—on a national basis—to prepare for essential construction work. It is true that we cannot provide protection against all exceptional storms. It is not economic to do so, and the environmental impact of doing so would be horrendous. Nevertheless, there is much research and construction that we need to do now.
  Cynics may say that there are no votes in spending on coastal protection, and that therefore one should do as little as possible. I am sure that my hon. Friend the Minister would agree that, although there may not be many votes to be gained by doing something, there are a great deal to be lost by doing nothing.
  In conclusion, I offer my hon. Friend an acronym to remind him of what is necessary. The acronym is CRAC: we need co-ordination, research and urgent action, and we definitely need the cash.
  10.16 pm
  Mr. Barry Field: I am obliged to my hon. Friend the Member for Bristol, East (Mr. Sayeed) for raising this important matter, and for so generously giving me a few moments of his precious Adjournment debate.
  My hon. Friend and I share love of the sea. Since I entered the House, he has been most generous with his help and advice and he has shown this evening that his knowledge of maritime matters is extensive. However, it is not quite true that there are no field data, as my own back garden runs down to the harbour in Cowes. Twice this year we have had the sea well up the garden, and there were surfboarders in Cowes high street as a result of exceptionally high tides this year. I can confirm that we have some field data.
  Sea defences are important, and nowhere more so than on an island such as the Isle of Wight. On our Solent and Channel shores, our coastline has taken an appalling battering this winter. Medina borough council estimates that its costs will be in excess of £100,000 for damage between Seaview and Puckpool and at Gurnard. South Wight borough council, which is responsible for over two thirds of the island's coastline, has already served notice on the Ministry of Agriculture, Fisheries and Food of the need for sea defence work at Monks Bay and Steephil Cove. At Monks Bay a large section of the cliff has now fallen away and the total cost is likely to be about 100,000.
  Does my hon. Friend the Minister agree that it is an extraordinary anomaly that councils that receive 70 per cent. of the capital costs grant-aided receive nothing for maintenance. Many of our coastal defences fall into disrepair and are ravaged by the mighty ocean, so that the local authorities must then rebuild them with more grant aid. The Minister should acknowledge the whole crazy system and, like the boy and the dyke, poke his finger into
  1214
  the nonsensical bureaucracy and stop the financial haemorrhage by grant-aiding maintenance work as well as capital grant aid.
  10.19 pm
  The Parliamentary-Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. David Maclean): I thank my hon. Friend the Member for Bristol, East (Mr. Sayeed) for the interest he has shown in this subject, which has been on all our minds so recently, and for giving me the opportunity to reassure him on the issues that are of concern to him and other hon. Members and to convey to the House my Department's responsibility and the present arrangements concerning coastal defence works.
  Recent exceptional weather conditions, resulting in both flooding and storm damage, have attracted public interest to flood and coastal defences. I start by expressing the Government's deepest sympathy to those who have been affected by this dreadful flooding.
  We all saw and applauded the way in which the National Rivers Authority and local authorities responded to the effects of a series of extraordinary storms in December, January and February. Local authorites and the regional organisations of the NRA are close to the scene of the flooding events, and, for this reason, are able to act quickly in an emergency. They know the area. They know the defences, for they and their predecessors have replaced, improved and maintained them over many years, and it is right that they should do so.
  While the Government keenly recognise the national significance of ensuring the upkeep of our coastal defences by contributing grant—at rates up to 75 per cent. from next year—towards the cost of these works, the defences are also local defences. The problems of flooding and erosion are also local. It is the local people who have to live with these defences at the bottom of their gardens, on the beaches or promenades in their towns, or in front of their houses, and who have to cope with the awful consequences of flooding; therefore, it is right that the solutions to these problems should have a strong local input. The present arrangements allow this to happen.
  Of course, as trustees of public funds, the Government must ensure that the works proposed for our coastline, and inland, represent a sound investment if they are to attract grant. For this reason, our team of project engineers works closely with the authorities concerned—in many cases, right from the inception of a project. My officials give careful and thorough appraisal to projects before they are approved for grant. Through our partnership with the NRA, which undertakes most flood defence works, we are encouraging a movement away from a piecemeal approach in defence construction towards long-term strategic planning—something for which my hon. Friend called—for instance, by supporting a detailed study of the Anglian coastline, which he mentioned, to ensure that the long-term problems are clear and that the best solution for the area is identified.
  The Government also have an important role to play nationally through setting a strategic framework for consideration of priorities for defences, funding research and development—for which my hon. Friend called—to elucidate approaches to defending the coastline, and through providing grant directing it to the priority areas. As guardians of investment of Government funds, through

  1215
  my river and coastal engineers, we ensure the economic, technical and environmental soundness of projects that are grant aided.
  This is a carefully balanced relationship, and it actually works on the ground. To change the balance of responsibilities in either direction would, I believe, render the provision of nationwide inland and coastal defence less effective, either because of overcentralisation in national Government, or because the potential difficulties of local bodies taking narrow local priorities would be exacerbated.
  High priority is given to coastal defences. My hon. Friend will be pleased to know that we are increasing the maximum grant for coastal defences from 70 to 75 per cent. next month. Over the next three years, the total Government grant provision in Britain for flood and coastal defences is £161 million, and, of this sum, 80 per cent. is likely to be spent on coastal works. These amounts represent substantial increases in provision by my right hon. Friends' Departments and my own. Increases average about 50 per cent., while, in my own Department, grant provision to the NRA—increased following both the 1988 and the 1989 public expenditure survey rounds as a result of a comprehensive review of flood defence needs—will almost double by 1992–93.
  In Wales, Scotland and England, grant provision is assessed on the basis of plans submitted by the authorities responsible for carrying out the works. In England, for example, the NRA submits annually a five-year programme of works. Information of this nature provides the medium-term planning which underpins our assessment of funding requirements, while also providing the information necessary to determine the capital expenditure limits in each region for the subsequent year.
  In England, funding is targeted according to priorities that put flood warning systems and the protection of people and property first. Additional support is given to sea and tidal defence works, which attract a supplement of 15 per cent. rising to 20 per cent. from next month.
  In the Anglian region, where needs are particularly high, capital expenditure limits, while already high, are being raised by 17 per cent. next year and are likely to increase further in succeeding years. Anglia also attracts some of the highest grant rates in England. The south-west is another area where flood and coastal defence needs are growing.
  Capital expenditure limits have been increased by 33 per cent. together with an increase in grant rate for coastal works to 65 per cent.. In the southern region, the entire planned programme for 1990–91 will attract grant from my Department.
  Mr. Barry Field: No one faults the capital grants, but the problem is how to maintain the defences, once they have been erected.
  Mr. Maclean: I noted carefully what my hon. Friend said in his speech. I shall consider the question of maintenance and will write to him, giving a detailed and considered reply.
  While the majority of the coastal defences in Britain stood up very well to the challenge of the recent extreme storm events, a few areas, most of them well publicised, have suffered the effects of flooding. I should stress that the weather conditions that led to the flooding have been exceptional. In a number of flooded areas, works were
  1216
  already programmed or under way. However, we have asked the authorities responsible for defences in areas where flooding and damage has occurred to review the defences and to give us an early indication of changes to programmes so that we can reconsider needs and priorities.
  I am aware of the particular problem of loss of beach material on the south coast which is causing anxiety to authorities and ourselves. Therefore, in partnership with the NRA and local authorities, I am considering the need for a study of the circumstances leading to the loss of beach material, with a view to identifying robust remedial measures.
  Interest in coastal defences has, I know, also grown through increasing awareness of the greenhouse effect and the consequent speculation on the possible effects this might have on sea levels. While the precise effects of global warming are not yet known, the greenhouse effect and its consequences are being extensively researched through international programmes with United Kingdom involvement.
  My Department is responsible for the national flood protection research programme and at present funds some 30 research projects on coastal defences, at a cost of £1.4 million. After the debates I will show my hon. Friend the Member for Bristol, East the list of those 30 projects This research ranges from United Kingdom sea level trends to the action and effects of waves, the behaviour of shingle beaches and the effectiveness of various types of sea defences. Many of these projects will assist in ensuring that coastal defences are so designed that any necessary adjustements, as sea level rises, can be made easily, thereby safeguarding the present investment. Currently, a relative sea level rise of 30 cm per century is taken into account in designing sea defences; this is about twice the present trend in sea level rise.
  My Department does not only involve itself in research related to the greenhouse effect; it also plays an active role in promoting the study of coastal regimes and encouraging the long-term strategic planning of flood defence works. For example, the most comprehensive study in the country is currently being undertaken on the Anglian coastline from the Humber to the Thames.
  Some of those present will recall the tragic events in 1953 when so many lives were lost as a result of flooding on the east coast. The defences built after that event have successfully withstood a similar threat from the North sea on several occasions. These defences are now reaching the end of their useful lives, and this major study will investigate coastal processes such as sediment movement and offshore conditions, to establish the best means of providing a sound defence along this vulnerable coastline. That is exactly the research for which my hon. Friend the Member for Bristol, East was calling.
  The research and development programme includes projects investigating extreme events, studying wave generation and predicting waves at the coast. The projects help to inform the design of protective structures, but some will be more immediately applicable. At the moment, there are questions about the best types of defences, whether they should be "hard", such as walls, or "soft" such as renewed beaches. There are research projects into the design of sea walls and examining cliff stability, sediment transport and beach profiles that will help to answer some of those important questions.

  1217
  However, there is unlikely to be a single solution that will be suitable for every site. The type of structures that have worked well in the past may be favoured in the future, but new understanding will allow more informed choices and the adoption of newer approaches to coastal defence.
  In summing up, I repeat my sympathy to those who have suffered flooding as a result of the exceptional weather. However, I remind the House that our coastal defences are kept under continual review and this is why, despite repeated attacks by wind, tides and surges, most of our coastal defences were effective and held up pretty well. Substantial increases in Government funding, including increasing the maximum grant rate for works on the coast
  1218
  and inland, have already been announced following our on-going reviews, and we intend to ensure that Government funding is sufficient to take account of necessary adjustments to programmes and priorities as a result of the recent storm events.
  My hon. Friend the Member for Bristol, East urged me to accept the acronym CRAC. We are right up to crack with CRAC. My Department is carrying out the co-ordination, we are committed to the research, we are treating the matter urgently and we are piling in the cash. I am grateful to my hon. Friend for giving me the opportunity to respond to this very important debate.
  Question put and agreed to.
  Adjourned accordingly at twenty-eight minutes to Eleven o'clock.

EMPLOYMENT

  Accountants and Engineers
  Mr. Austin Mitchell
  To ask the Secretary of State for Employment what information he has on the number of(a) qualified accountants and (b) qualified engineers in Britain.

  Mr. Nicholls
  It is estimated from the preliminary results of the 1989 labour force survey that in Spring 1989 there were 139,000 accountants with professional qualifications and 382,000 engineers who performed work normally requiring training of university degree standard in Great Britain, who were either in employment, or were not in employment but had been employed in these occupations in their last job, and had left that job less than three years prior to the survey.

  Disabled Workers
  Mr. Ashley
  To ask the Secretary of State for Employment what percentage of employers with over 20 employees have fulfilled their 3 per cent. quota of disabled workers in each of the last five years.

  Mr. Eggar
  The percentage of employers with 20 or more employees employing their 3 per cent. quota of registered disabled workers in each of the last five years is as follows:

  Per cent.

  1985

  28·1

  1986

  26·8

  1987

  25·3

  1988

  23·9

  1989

  22·8

  Employment Training
  Mr. Ray Powell
  To ask the Secretary of State for Employment (1) how many filled employment training places there are in the constituency of Ogmore; and what percentage this represents of the original departmental projections;

  (2) what was the total number of unemployed receiving enterprise training within employment training between September 1988 and December 1989 for the Ogmore constituency.

  Mr. Nicholls
  The information requested is not available for the Ogmore constituency and can be provided only at disproportionate cost.

  Mr. Ray Powell
  To ask the Secretary of State for Employment what was the total expenditure on the £10 employment training trainee allowance in December 1989 for the Ogmore constituency.

  Mr. Nicholls
  The information is not available.

FOREIGN AND COMMONWEALTH AFFAIRS

  East European Countries
  Mrs. Gorman
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he has any information regarding reform of the internal security forces in (i) Poland, (ii) Czechoslovakia, (iii) Hungary, (iv) Bulgaria, (v) the Soviet Union, (vi) Romania and (vii) the Baltic states.

  Mr. Waldegrave
  The information will take a little time to assemble. I will write to my hon. Friend as soon as possible.

  UNESCO
  Mrs. Gorman
  To ask the Secretary of State for Foreign and Commonwealth Affairs what were the reasons the United Kingdom left UNESCO; and whether any of them have been resolved.

  Mr. Sainsbury
  When the United Kingdom left UNESCO we set out in detail the reasons for our withdrawal. Both at the time and since we have made clear that UNESCO should concentrate on the objectives set out in its constitution; it should cut back its proliferation of programmes, alter or abolish those which are inimical to democratic values (such as press freedom and individual human rights), make its delivery of technical assistance more efficient and overhaul its administration.

  We are curently conducting a review to consider to what extent these problems have been resolved.

  Lithuania
  Mrs. Gorman
  To ask the Secretary of State for Foreign and Commonwealth Affairs what information he has on any proposals to privatise industry in Lithuania.

  Mr. Waldegrave
  We are not aware of specific proposals for the privatisation of industry in Lithuania. A law on property was adopted by the Lithuanian supreme soviet on 12 February 1990 which provides for private, collective and state property, but does not describe how state property may he transferred to private ownership.

  Colombia
  Mr. Harry Barnes
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he has any information as to whether British mercenaries are operating in Colombia.

  Mr. Sainsbury
  There have been unconfirmed reports that at least one British citizen has renewed an association with drug traffickers in Colombia. We have discussed the matter with the Colombian authorities and reaffirmed our willingness to co-operate with them in their investigations.

  Libya
  Mr. Janman
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make representations to the Soviet and German Democratic Republic Governments urging them to withdraw all technical support from the Libyan military immediately.

  Mr. Waldegrave
  Our position on Libya is already abundantly clear to these and other Governments.

CIVIL SERVICE

  Agencies
  Mr. Gerald Bowden
  To ask the Minister for the Civil Service whether any agency chief executives have been selected from the private sector.

  Mr. Luce
  Yes. Ten agency chief executives or chief executives-designate were appointed following open competitions and came from outside the Civil Service. This figure includes some who were already in post before the agency was established.

  Mr. John Marshall
  To ask the Minister for the Civil Service how many next steps agency chief executives are women.

  Mr. Luce
  I have recently appointed the first woman chief executive, Miss Marianne Neville-Rolfe, who is principal and chief executive of the civil service college.

NATIONAL FINANCE

  Valuation Offices
  Mrs. Gorman
  To ask the Chancellor of the Exchequer what is the cost of running the Inland Revenue's valuation offices in England and Wales; and what is the expected reduction in(a) cost and (b) staff in the valuation offices as a result of introducing the community charge.

  Mr. Lilley
  The cost of running the valuation offices in England and Wales for the current financial year 1989–90 is £125 million.

  (a) When all outstanding domestic rating work has been cleared, the reduction in annual cost, in real terms, as a result of introducing the community charge is expected to be of the order of £17 million;

  (b) £17 million represents a saving of about 1,300 clerical staff.

  German Economy
  Sir Trevor Skeet
  To ask the Chancellor of the Exchequer if he will list the principal economic data of(a) the Federal Republic of Germany and (b) a merged Germany.

  Mr. Ryder
  A wide range of economic data for West Germany are published each month in the IMF's international financial statistics and the OECD's main economic indicators. Data for a merged Germany are not available.

  Sir Trevor Skeet
  To ask the Chancellor of the Exchequer if he will state the current expenditure of the Federal Republic of Germany on research and development with separate assessments for the public and private sectors.

  Mr. Ryder
  Data on research and development expenditure in West Germany are available biannually in the OECD's main science and technology indicators.

  European Monetary System
  Mrs. Gorman
  To ask the Chancellor of the Exchequer what recent representations he has received regarding the impact on the European monetary system of currency union between East and West Germany.
  610
  Mr. Ryder
  My right hon. Friend the Chancellor has received no representation on the impact on the European monetary system of the proposed monetary union between the two Germanies.

  European Community
  Mr. Teddy Taylor
  To ask the Chancellor of the Exchequer (1) what is the level of United Kingdom net contributions to the European Economic Community in 1989, following the appraisal by the Community; and if he will express the sum in sterling per household in the United Kingdom per week;

  (2) what were the consequences for the United Kingdom of the appraisal by the European Economic Community of United Kingdom contributions; and if he will make a statement.

  Mr. Ryder
  [holding answer 20 March 1990]: The latest published estimate of the United Kingdom's net contribution to the Community budget in 1989, which appeared in the "Statement on the 1989 Community Budget" (Cm. 680), is £1,966 million. This figure is the equivalent of £1·73 per household per week, on the basis of the estimate of 21·816 million private households in the United Kingdom in 1986 which is contained in "Eurostat: Basic Statistics of the Community" (26th edition). A revised estimate of the United Kingdom's net contribution in 1989 will be published shortly in the "Statement on the 1990 Community Budget", and will be based on a full analysis of all items of revenue and expenditure including the European Commission's reappraisal of the United Kingdom's contributions to the Community budget.

  Mr. Teddy Taylor
  To ask the Chancellor of the Exchequer (1) what estimate he has made of the United Kingdom's net contribution to the EEC in 1989; and what were the totals for each of the previous five years;

  (2) if he will make a statement on the nature of the deficit with EEC institutions of £2,301 millions on the balance of payments transfers sheet in the paper issued by the Central Statistical Office; and in what respect this figure differs from the previous figures published in the United Kingdom's net contribution for 1989.

  Mr. Ryder
  [holding answers 19 and 20 March 1990]: The latest published estimate of the United Kingdom's net contribution to the Community budget in 1989 which appeared in the "Statement on the 1989 Community Budget" (Cm 680), is £1,966 million. The coverage of that figure differs from the coverage of the figure for the United Kingdom's net contribution to EC institutions published by the CSO. The two numbers are not therefore directly comparable.

  A revised estimate for 1989, comparable with the figure of £1,966 million and based on a full analysis of all items of revenue and expenditure will be published shortly in the statement on the 1990 Community budget.

  The net contribution to the Community budget for each of the previous five years were as follows:

  Net contribution to European Community budget

  (£ million)

  1984

  656

  1985

  1,808

  1986

  572

  1987

  1,721

  1988

  1,362

  Tax Debts
  Mr. Win Griffiths
  To ask the Chancellor of the Exchequer how many petitions have been presented by HM Customs and Excise in each of the last three years; and what percentage of these were to secure the repayment of value added tax debt.

  Mr. Ryder
  [holding answer 20 March 1990]: The total number of petitions presented by the Customs department, as Commissioners of Customs and Excise, in each of the years specified in the table is as follows:

  Number of petitions presented in the English and Northern Ireland jurisdiction

  Year ending 31 March

  Number

  1987

  3,616

  1988

  3,098

  1989

  3,862

  Number of petitions presented in the Scottish jurisdiction

  Calendar year

  Number

  1987

  120

  1988

  109

  1989

  153

  It is not possible to state precisely what percentage of these petitions relate to value added tax, because separate records are not maintained.

  Relocation
  Mr. Frank Field
  To ask the Chancellor of the Exchequer if he will list for each year since 1979 the number of civil service jobs which have been transferred from the south-east to areas of high unemployment, and the departments responsible for these transfers; and what plans the Government has over the next five years for a further transfer of work, and which Departments are concerned.

  Mr. Ryder
  [holding answer 20 March 1990]: The information requested is not held centrally in the form requested, but I would refer the hon. Member to the reply that I gave to my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) on 17 January, 1990, Official Report, columns 289–90.

  Inland Revenue Staff
  Mr. Matthew Taylor
  To ask the Chancellor of the Exchequer what is(a) the total cost of the administration and collection of income tax in 1989–90, (b) the number of people employed in the collection and administration of income tax and (c) the estimated receipts from income tax in 1989–90.

  Mr. Lilley
  [holding answer 20 March 1990]: The total cost of the administration and collection of income tax in 1989–90 is estimated at £1,070 million. The manyear usage of staff directly employed in the administration and collection of income tax in 1989–90 is about 48,000. For part (c) of the question I refer the hon. Member to table 1.2 of the 1990–91 Financial Statement and Budget Report published yesterday.

  Civil Servants, Northern Ireland
  Mr. William Ross
  To ask the Chancellor of the Exchequer if he will publish a table in the Official Report to show the number of United Kingdom civil servants employed at present and in 1985 in each council area in Northern Ireland.

  Mr. Ryder
  [holding answer 20 March 1990]: At I April 1989 there were 5,185 civil servants in Northern Ireland. This compares with 5,168 at 1 April 1985. These numbers exclude staff in the Northern Ireland civil service. The table shows the distribution of non-industrial civil servants in the following areas. No information is available about the location of industrial civil servants.

  Non-industrial civil servants staff numbers1

  Council Area

  1985

  1989

  County Antrim

  703

  778

  County Armagh

  175

  182

  City of Belfast

  1,265

  1,216

  City of Londonderry

  66

  74

  County Down

  376

  386

  County Fermanagh

  122

  115

  County of Londonderry

  275

  294

  County Tyrone

  65

  78

  Total

  3,047

  3,123

  1 Full-time equivalents—part-timers working for more than 10 hours count as half units.

OVERSEAS DEVELOPMENT

  Namibia
  Mr. William Powell
  To ask the Secretary of State for Foreign and Commonwealth Affairs whether he plans to provide assistance to independent Namibia; and if he will make a statement.

  Mrs. Chalker
  I am delighted to inform the House that following successful implementation of United Nations Security Council resolution 435, Namibia has today achieved independence, and has become the 50th member of the Commonwealth. My right hon. Friend the Secretary of State is representing Britain at the independence celebrations in Windhoek and will today announce a bilateral aid package of £10 million for commitment over three years.

  Our aid will focus on technical co-operation and rehabilitation. Precise details will be agreed with the new Government, but I expect the sectors in which we will provide assistance to include public service reform, education, police training and fisheries management. Following discussions with the Namibian authorities we have already financed initial advisory visits by British experts to see how we might best help, and our assistance with police training and with education is already underway. Namibia will be a high priority for projects jointly funded with British voluntary agencies and Voluntary Service Overseas will also be discussing priorities with the new Government. In addition to our bilateral aid we will be providing substantial assistance through multilateral channels including the European Community and the Commonwealth Fund for Technical Co-operation.

  I have authorised the Commonwealth Development Corporation to begin operations there, and it will send an exploratory mission in April.

TRADE AND INDUSTRY

  Accounting and Auditing
  Mr. Austin Mitchell
  To ask the Secretary of State for Trade and Industry whether, since June 1979, any of his Department's Ministers or senior civil servants have had any business connections with accountancy firms or the accountancy bodies.

  Mr. Redwood
  One senior official in my Department is the chairman of the disciplinary committee of the Chartered Association of Certified Accountants. The official holds this position in a private capacity and with the approval of the Department, as there is no conflict of interest. I am aware of no other business connections between the accountancy profession and Ministers and senior officials of my Department. I do not know the interests of all DTI Ministers prior to their appointments.

  Insider Dealing
  Mr. Austin Mitchell
  To ask the Secretary of State for Trade and Industry whether, further to the reply that he gave to the right hon. Member for Great Grimsby on 31 January,Official Report, column 225, he will give details of the number of convictions obtained by his Department where the defendants pleaded not guilty.

  Mr. Redwood
  Two convictions for insider dealing offences have been obtained by my Department after the defendants had pleaded not guilty. In one of those cases the defendant was subsequently acquitted on appeal.

  Advertising Expenditure
  Mr. Cohen
  To ask the Secretary of State for Trade and Industry what was the total publicity and advertising expenditure, including for privatisation, of his Department and public bodies for which his Department has responsibility in(a) 1979 and (b)

  Firework Injuries in Great Britain

  (4 week period in October-November)

  Year

  1989

  1988

  1987

  1986

  1985

  Total

  800

  877

  960

  846

  968

  Place of Accident

  1. Family or private party

  280

  300

  260

  286

  255

  2. Semi-public display (eg scouts, cricket club)

  71

  69

  88

  72

  76

  3. Large public display

  135

  123

  155

  119

  117

  4. Casual incident in street etc

  247

  298

  364

  299

  435

  5. Other place

  46

  65

  73

  52

  64

  6. Indoors

  21

  22

  20

  18

  21

  Type of Firework

  1. Banger

  136

  162

  163

  161

  241

  2. Rocket

  131

  164

  174

  159

  197

  3. Roman candle, coloured fire etc.

  89

  83

  96

  88

  90

  4. Home-made or extracted powder

  18

  17

  24

  14

  27

  5. Other proprietary fireworks

  125

  86

  109

  118

  73

  6. Sparklers

  83

  102

  95

  80

  67

  7. Unspecified type

  218

  263

  299

  226

  273

  Severity of Injury

  1. Fatal injury

  —

  —

  —

  —

  —

  2. Detained more than one night

  46

  69

  60

  48

  53

  3. Sufficient to cause absence from work or equivalent

  142

  167

  158

  160

  231

  4. Minor injury

  551

  587

  661

  582

  632

  5. Unspecified injury

  61

  54

  81

  56

  52

  Eye Injuries (included in 2–5)

  275

  269

  312

  291

  341

  Age Group of Injured Persons

  1. Over 20

  251

  280

  252

  235

  214

  614
  Mr. Forth
  The Department does not maintain central records of expenditure of this kind by public bodies. The Department's expenditure on paid advertising and promotional materials in 1979–80 was given in an answer to the hon. Member for Holborn and St. Pancras (Mr. Dobson) on 13 March 1990,Official Report, columns 173–74. I expect expenditure under the Department's central publicity budget in 1989–90 to be of the order of £21 million. There was no significant expenditure on privatisation publicity by the Department in either year. Figures covering calendar years are not available.

  Firework Injuries
  Mr. Harris
  To ask the Secretary of State for Trade and Industry if he will publish the figures of injuries caused by fireworks in 1989.

  Mr. Forth
  According to reports from hospitals in England, Wales and Scotland, 800 people required treatment for injuries caused by fireworks during the three weeks leading up to 5 November 1989 and the few days after. This represents a very welcome decrease of nearly 9 per cent. over 1988. Particularly encouraging were the sharp falls in serious injuries and casual incidents in the street, where our emphasis on rigorously enforcing the existing law on selling fireworks to the under-16s or misusing them in public seems to be bearing fruit. Also welcome is the fall in sparkler injuries as these tend to affect very young children and was an area where we put a lot of effort during last year's successful firework safety campaign. However, there is no room for complacency and we will be looking for a further reduction in injuries this year. The detailed breakdown for 1989 and the preceding four years is as follows:
  615

  Year

  1989

  1988

  1987

  1986

  1985

  Total

  800

  877

  960

  846

  968

  2. 16–20

  135

  151

  168

  145

  161

  3. 13–15

  152

  166

  220

  207

  271

  4. Under 13

  262

  280

  320

  259

  322

  Refrigerator Doors
  Mr. Tredinnick
  To ask the Secretary of State for Trade and Industry whether he has any plans to adopt international standards for fridge doors.

  Mr. Forth
  [holding answer 16 March 1990]: I take the reference to international standards for fridge doors to mean those which define suitable door locking mechanisms to prevent the entrapment of people. I understand that these features have been included in British standards since the 1970s for this type of electrical and gas equipment and will shortly be incorporated in a new European harmonised standard. All United Kingdom manufactured goods are now fitted with the appropriate safeguards. I would encourage all other manufacturers to adopt these standards, in so far as they reflect these safety features, so as to reduce the likelihood of another tragic accident.

  Indonesia
  Mr. Mullin
  To ask the Secretary of State for Trade and Industry what was the value of British trade with Indonesia for each of the last 10 years.

  Mr. Redwood
  [holding answer 19 March 1990]: The value of United Kingdom trade with Indonesia during the last 10 years was as follows:

  Year

  £ million Exports

  £ million Imports

  £ million Balance

  1980

  112·2

  57·0

  +55·2

  1981

  139·2

  73·8

  +65·4

  1982

  212·1

  90·7

  +121·4

  1983

  193·6

  169·4

  +24·2

  1984

  186·7

  181·5

  +5·2

  1985

  175·3

  155·9

  +19·4

  1986

  196·5

  141·2

  +55·3

  1987

  236·0

  144·8

  +92·0

  1988

  203·3

  233·8

  -30·5

  1989

  184·0

  273·1

  -89·1

  Eastern Europe
  Mr. Flynn
  To ask the Secretary of State for Trade and Industry if, during his recent visit to the Soviet Union, he raised the possibility of providing pollution abatement technology and technical advice on how to clean up polluted land and water.

  Mr. Forth
  [holding answer 20 March 1990]: No. The subject was not raised specifically by either side. The supply of western technology in all spheres is hampered by the increasing scarcity of hard currency. During my right hon. Friend's visit he concentrated his discussions on the problems for the Soviet economy as a whole to which this contributes.

PRIME MINISTER

  Central Unit on Purchasing
  Mr. Colvin
  To ask the Prime Minister if she will make a statement on the purchasing progress report 1989 prepared by the central unit on purchasing.

  The Prime Minister
  The central unit on purchasing's 1989 progress report recorded value for money improvements in central Government Departments' purchasing of over £350 million in 1988–89, excluding the Ministry of Defence. This saving was equivalent to 5·3 per cent. of total reported purchasing expenditure.

  The purchasing initiative has now resulted in value for money improvements equivalent to some £850 million since 1985–86.

  Although this represents good progress, greater emphasis now needs to be given to increasing professionalism amongst staff engaged in purchasing and supply, and to supporting them with compatible purchasing information and control systems. The central unit on purchasing is actively working with departments on these issues.

  A copy of the progress report is in the Library of the House.

WALES

  Laura Ashley Company
  Mr. Barry Jones
  To ask the Secretary of State Wales what amounts of Government cash and grants have been given to Laura Ashley Company in each year by his Department, the Welsh Development Agency and the Mid Wales Development Board.

  Mr. Peter Walker
  In addition to assistance offered by other departments, published details of Welsh Office aid to the Laura Ashley company is as follows:

  Year

  £

  Grant

  1976

  6,000

  Interest relief grant

  1977

  6,000

  Interest relief grant

  1979

  17,000

  Interest relief grant

  1980

  11,000

  Interest relief grant

  1983

  22,000

  Interest relief grant

  1986

  326,000

  Regional development grant

  1988

  40,000

  Regional development grant

  1989

  94,000

  Regional development grant

  The Laura Ashley company has also received rent concessions from the Welsh Development Agency in the years 1985 and 1986 and a grant from the Development Board for Rural Wales in 1989. It is not those institutions' policy to publish amounts involved in individual cases.

  Ysgol Belmont School
  Mr. Barry Jones
  To ask the Secretary of State for Wales if he will visit Ysgol Belmont special school.

  Mr. Wyn Roberts
  Neither my right hon. Friend nor I have any plans to do so.

  Competitive Tendering
  Mr. Wigley
  To ask the Secretary of State for Wales what information he has on which services in each district, borough and city council were put under competitive tendering during 1989–90; how many were employed in supplying these services before the commencement of the

  Local Authority

  Phasing in of Competition by Date and Activity

  Group 1. Aberconwy: Alyn and Deeside: Montgomeryshire: Preseli Pembrokeshire: Llanelli: Ogwr: Cardiff: Blaenau Gwent: Rhondda

  Group 2. Clwyd: West Glamorgan: Colwyn: Arfon: Brecknock: South Pembrokeshire: Swansea: Taff Ely: Torfaen

  Group 3. Gwent: Gwynedd: Delyn: Dwyfor: Radnor: Carmarthen: Lliw Valley: Merthyr Tydfil: Monmouth

  Group 4. Mid Glamorgan: Powys: Glyndwr: Dinefwr: Port Talbot: Rhymney Valley: Vale of Glamorgan: Ynys Mon-Isle of Anglesey: Newport

  Group 5. South Glamorgan: Dyfed: Ceredigion: Cynon Valley: Islwyn: Meirionnydd: Neath: Rhuddlan: Wrexham Maelor

  Refuse Collection

  Building Cleaning

  School Welfare Catering

  Other Catering

  Vehicle Maintenance and Repair

  Other Cleaning

  1 August 1989

  1

  4

  1

  5

  3

  2

  1 January 1990

  2

  5

  2

  1

  4

  3

  Note: Numbers refer to qroups of authorities.

  Local Government Finance
  Mr. Wigley
  To ask the Secretary of State for Wales what is the total amount of money which each district borough and city council is likely to get from the poll tax.

  Mr. Peter Walker
  District councils in Wales are in the process of submitting information to the Welsh Office relating to their community charges and budgets. I shall write to the hon. Gentleman with the information he requested when all the returns have been received and checked.

  Mr. Wigley
  To ask the Secretary of State for Wales how many community councils there are within each district borough and city council area in Wales; what will be the average poll tax charged for community council purposes for each community council; and how many community councils will be entitled to transitional support during the first year of the poll tax and up to what level in each instance.

  Mr. Peter Walker
  The number of community councils within each district, borough or city council area is shown in the table:

  Districts

  Number of Community Councils

  Alyn and Deeside

  13

  Colwyn

  16

  Delyn

  21

  Glyndwr

  35

  Rhuddlan

  8

  Wrexham Maelor

  29

  Carmarthen

  41

  Ceredigion

  51

  Dinefwr

  23

  Llanelli

  9

  618
  competitive tendering process; and how many were employed in supplying these services following the completion of the competitive tendering exercise.

  Mr. Peter Walker
  I refer the hon. Gentleman to the following competition implementation timetable. In addition, local authorities, where relevant, were required to submit 20 per cent. of their ground maintenance service to competition by 1 January 1990. Competition-free allowances available to local authority direct labour organisations in respect of new construction and works of maintenance under the Local Government, Planning and Land Act 1980 were abolished from 1 October 1989. Information in respect of the numbers of employees in each service is not held centrally.

  Districts

  Number of Community Councils

  Preseli Pembrokeshire

  52

  South Pembrokeshire

  26

  Blaenau Gwent

  5

  Islwyn

  —

  Monmouth

  32

  Newport

  14

  Tofaen

  6

  Aberconwy

  18

  Arfon

  17

  Dwyfor

  17

  Meirionnydd

  29

  Ynys Mon

  40

  Cynon Valley

  3

  Merthyr Tydfil

  2

  Ogwr

  22

  Rhondda

  —

  Rhymney Valley

  14

  Taff-Ely

  10

  Brecknock

  36

  Montgomeryshire

  45

  Radnorshire

  27

  Cardiff

  5

  Vale of Glamorgan

  24

  Lliw Valley

  15

  Neath

  14

  Port Talbot

  1

  Swansea

  14

  TOTAL WALES

  735

  Information about community council precepts for 1990–91 is not yet available.

  Transitional relief is awarded in respect of community council areas, rather than community councils. A total of

  619
  324 such areas will receive relief in 1990–91, in amounts up to £93 per chargepayer per annum. The amounts for each community area are set out in the Personal Community Charge (Relief) (Wales) Regulations 1990, which were laid before Parliament on 19 February 1990.

  Mr. Wigley
  To ask the Secretary of State for Wales how many extra part-time and full-time members of staff have been employed by his Department to implement the poll tax in Wales.

  Mr. Peter Walker
  None.

  Mr. Wigley
  To ask the Secretary of State for Wales how much was spent by each district borough and city council in Wales to collect rates during 1989–90.

  Mr. Peter Walker
  Budgeted expenditure on rate collection by each district borough and city council in Wales during 1989–90, is shown in the table:

  Local authority:

  1989–90 Budget (At Outturn Prices) £000

  Alyn and Deeside

  123

  Colwyn

  169

  Delyn

  179

  Glyndwr

  173

  Rhuddlan

  186

  Wrexham Maelor

  395

  Carmarthen

  231

  Ceredigion

  228

  Dinefwr

  113

  Llanelli

  201

  Preseli Pembrokeshire

  174

  South Pembrokeshire

  136

  Blaenau Gwent

  219

  Islwyn

  175

  Monmouth

  193

  Newport

  413

  Torfaen

  245

  Aberconwy

  281

  Arfon

  247

  Dwyfor

  140

  Meirionnydd

  51

  Ynys Mon

  327

  Cynon Valley

  182

  Merthyr Tydfil

  319

  Ogwr

  196

  Rhondda

  320

  Rhymney Valley

  347

  Taff Ely

  671

  Brecknock

  144

  Montgomeryshire

  170

  Radnor

  92

  Cardiff

  1,384

  Vale of Glamorgan

  467

  Port Talbot

  196

  Lliw Valley

  173

  Neath

  237

  Swansea

  588

  Total Wales

  10,087

  Bosch Factory
  Mr. Morgan
  To ask the Secretary of State for Wales if he will institute a study into the effect of the new Bosch alternator factory development at Miskin, south Wales on the overall supply, demand and training facilities for skilled engineering labour in the industrial south Wales region.

  Mr. Peter Walker
  The employment service and the Training Agency continually gather and assess labour 620
  market information and take account of developments such as the new Bosch factory, in order to identify labour supply, demand and training needs.

  The prime responsibility for identifying and responding to the training needs of the local labour market will in the future pass to the private-sector-led training and enterprise councils.

HEALTH

  Cancer (Records)
  Mr. O'Brien
  To ask the Secretary of State for Health if he will introduce measures to improve the degree to which the Office of Population Censuses and Surveys keeps its records on cancer-related diseases up to date; and if he will make a statement.

  Mr. Freeman
  The OPCS publishes annual cancer statistics using data collected by 11 regional registries and the Wales cancer registry which are funded by the regional health authorities.

  The timing of publications is largely governed by when the slowest regional cancer registry provides OPCS with data. For 1985, data from the last registry was not received until September 1989. The volume giving 1985 registration data is expected to be published in April 1990, with that for 1986 following in July 1990.

  A recent review of the cancer registration system was undertaken, with timeliness of data presentation one of the considerations looked at by the working party. The report of the review is due in April 1990.

  Mr. O'Brien
  To ask the Secretary of State for Health what plans he has to require district health authorities to maintain records on the number of people in their areas who have been diagnosed or treated for cancer or cancer-related diseases, including leukaemia; and if' he will make a statement.

  Mr. Freeman
  Health authorities already participate in a national scheme, which will continue, for recording the incidence of cancers, including leukaemia. Records on the in-patient and day-care treatment of cancers are held in the information systems of district health authorities.

  NHS Staff
  Ms. Harman
  To ask the Secretary of State for Health what are the current staff vacancy levels and staff turnover rates for the administrative and clerical grades within the National Health Service.

  Mrs. Virginia Bottomley
  Information on staff vacancy levels is not available centrally. Information on staff turnover rates in the NHS for 1987–88 is published in "Health Service Indicators" which are held in the Library.

  In Vitro Fertilisation
  Mr. Speller
  To ask the Secretary of State for Health what facilities are available for in vitro fertilisation under the National Health Service for residents in south-west England; and what plans he has to provide such a service.

  Mrs. Virginia Bottomley
  I understand that in vitro fertilisation (IVF) services in the south-western region are available to residents of Southmead district health
  621
  authority, and exceptionally to residents of other districts. Decisions about the priority and resources to be given to infertility services as a whole, and the place of an IVF programme within them, are matters for district health authorities.

  Homelessness
  Mr. David Nicholson
  To ask the Secretary of State for Health what information he has of the number of parents who gratuitously eject their children in the 16 to 21 years age band from the family home; what powers there are to prosecute in such cases where homelessness results; and if he will make a statement.

  Mrs. Virginia Bottomley
  Information in the form requested is not available. Local authorities have a duty to receive into care children under 17 who are abandoned or deserted by their parents or who are lost. In the year ending 31 March 1987, 100 children aged 16 were received into care for these reasons. There are no specific powers to prosecute parents who eject children aged 16 to 21 from the family home where homelessness results.

  Hospitalisation Rates
  Mr. Jack
  To ask the Secretary of State for Health if he will publish in the Official Report, for each English and Welsh district health authority, the 1988–89 hospitalisation rates based on the projections for 1991 resident populations, with results, omitting the specialties of maternity and psychiatry, but showing a rate (a) weighted by national expenditure rates, (b) rated by expenditure rates plus <75 SMR 1984–88, (c) weighted by expenditure rates plus <75 SMR (0·5 elasticity) and (d) weighted by expenditure rates plus <65 SMR.

  Mr. Freeman
  I regret the information requested is not readily available. Such information as could be provided would incur disproportionate costs to produce. Information for Wales is a matter for my right hon. Friend the Secretary of State for Wales.

  Medical Services
  Mr. Worthington
  To ask the Secretary of State for Health what calculations he has made about the rate of inflation on provision of the medical services.

  Mr. Freeman
  [holding answer 19 March 1990]: I refer the hon. Member to the reply which I gave the hon. Member for Wentworth (Mr. Hardy) on 20 March at column 559.

  Asthma
  Mr. Flynn
  To ask the Secretary of State for Health if he will make it his policy to extend to asthmatics the same arangements for free regular prescriptions that now apply to diabetics.

  Mrs. Virginia Bottomley
  [pursuant to her reply, 24 November 1989 c. 40]: I am pleased to announce that we will shortly be making peak flow meters available on general practitioner prescription. These meters monitor the patient's airways and can prevent potentially serious attacks by giving advance warning so that medication can be adjusted. These will be available to patients as soon as suitable supply arrangements can be completed. The value
  622
  of peak flow monitoring has been underlined by recent asthma research and as a preventive measure it is seen as comparable to diabetics' use of blood glucose testing strips which were made prescribable some 18 months ago. The Government will also be providing to the National Asthma Campaign £15,000 a year for the next three years to help set up a telephone consulting service.

NORTHERN IRELAND

  Fair Employment Commission
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland how many persons have been appointed to the post of director in the Fair Employment Commission; and how many of these are perceived to be (1) Protestants, (2) Roman Catholics and (3) other.

  Mr. Needham
  Three persons have been appointed to director posts with the Fair Employment Commission. The commission is currently in the process of recruiting employees and will be submitting a monitoring return in accordance with section 27 of the Fair Employment (NI) Act 1989. Once the final staffing complement has been reached, the commission intends to publish detailed information on the religious composition of its staff and the progress of its affirmative action programme as a follow-up to the information published by the commission on 22 February 1989.

  Extradition
  Mr. William Ross
  To ask the Secretary of State for Northern Ireland, further to his answer to the hon. Member for Londonderry, East, of 27 February,Official Report, column 144, if he will publish a table to show from 1971 the number of persons extradited in each year from the Irish Republic to Northern Ireland for (I) terrorist offences and (2) non-terrorist offences.

  Mr. Cope
  I refer the hon. Gentleman to the answer I gave him on 22 February 1990, Official Report, columns 767–68.

  Deaf-blind Children
  The Rev. Martin Smyth
  To ask the Secretary of State for Northern Ireland what support is provided to the families of pre-school deaf-blind children in Northern Ireland.

  Mr. Needham
  The normal range of primary care and hospital services is available to deaf-blind children and their families. In addition, a child may be assessed for services locally or by a multi-disciplinary team at the Royal Belfast hospital for sick children. Low-vision aids and high-powered hearing aids are supplied as necessary.

  Following assessment, social workers arrange for support, counselling and the provision of a range of equipment to assist with daily living. Some parents and their children attend the SENSE centre in west London for specialist information and advice.

  Other support can take the form of assistance to parents at home by teachers from special schools or from education and library boards' peripatetic teaching service. Children are also welcome to visit toy and book libraries associated with special schools.

  Labour Statistics
  Mr. William Ross
  To ask the Secretary of State for Northern Ireland if he will publish a table in the Official Report to show by standard category the umemployment levels in Northern Ireland at the latest available date and at the same period five years ago.

  Mr. Needham
  [holding answer 13 March 1990]: The number of unemployed claimants in Northern Ireland categorised by industrial sector for February 1985 and February 1990 is set out in the table.

  Industrial analysis of the unemployed in Northern Ireland

  Industrial classification

  Number of persons February 1985

  Number of persons February 1990

  Agriculture, forestry and fishing

  2,895

  2,247

  Energy and water supply

  445

  344

  Metal and chemical manufacture

  1,951

  959

  Engineering

  6,174

  3,661

  Food, drink and tobacco

  4,089

  3,419

  Textiles

  2,275

  1,422

  Clothing and footwear

  3,199

  1,844

  Other manufacturing

  2,805

  1,814

  Construction

  23,228

  18,047

  Distribution hotels and catering

  12,719

  8,638

  Transport and communication

  2,856

  2,325

  Finance and business services

  2,166

  1,627

  Education services

  2,697

  1,837

  Health services

  2,980

  1,995

  Other public administration

  5,276

  3,221

  Other services

  6,889

  12,676

  Not elsewhere specified

  40,313

  32,863

  Total

  122,957

  98,939

  GP Contracts
  Mr. Hume
  To ask the Secretary of State for Northern Ireland what base data indexes will be used in formulating practice budgets and indicative prescribing budgets for general medical practitioners in Northern Ireland.

  Mr. Needham
  [holding answer 14 March 1990]: Indicative prescribing budgets and practice funds will be set at levels which reflect the needs of patients. The precise method of calculation has not yet been determined.

  Mr. Hume
  To ask the Secretary of State for Northern Ireland what consideration has been given by the Northern Ireland DHSS to employing the eight Jarman factors to index social deprivation in relation to general medical practitioners' practice budgets and indicative prescribing budgets; what factors the Department would not deem to be appropriate for use in Northern Ireland giving the reasons for this; and what factors it deems to be suitable giving reasons.

  Mr. Needham
  [holding answer 14 March 1990]: The factors to be taken into account in determining GP indicative budgets and practice funds have not yet been decided. No detailed consideration has yet been given to the use of factors relating to social deprivation.

  Mr. Hume
  To ask the Secretary of State for Northern Ireland what social factors will be taken into account in determining practice budgets and indicative prescribing budgets for general medical practitioners in Northern Ireland.
  624
  Mr. Needham
  [holding answer 14 March 1990]: Indicative prescribing budgets and practice funds will be set at levels which reflect the needs of patients. The factors to be taken into account in determining the levels and whether social factors should he used have not yet been decided.

  Equal Opportunities
  Mr. McNamara
  To ask the Secretary of State for Northern Ireland how many of his Department's management training courses include sessions on equal opportunities for women; and what proportion of managers at grade six level and above working outside headquarters has received training on equal opportunities for women.

  Mr. Cope
  [holding answer 5 March 1990]In the Northern Ireland Civil Service equal opportunities for women is specifically addressed in the following management training courses:Leadership Developments for Women and Men
  Women in Management—Excellence Network
  Women in Management

  Six staff at grade level 6 and above have attended the course on leadership developments for women and men. None of these staff work outside headquarters.

  In addition, equal opportunities aspects are embodied, where appropriate, in other management training courses including those on recruitment interviewing, promotion interviewing and staff appraisal.

  The small home civil service cadre of the Northern Ireland Office does not run its own management training courses. No staff at grade level 6 or above have attended specific courses of training on this subject. However, training needs are considered and all staff are encouraged to attend appropriate courses, some of which include sessions on equal opportunities for women, run mainly by the Northern Ireland civil service or the civil service college.

EDUCATION AND SCIENCE

  Trinity College of Music
  Mr. Stern
  To ask the Secretary of State for Education and Science if a permanent home for the Trinity school of music has yet been decided upon.

  Mr. Jackson
  This is a matter for the governing body of Trinity college of music. I understand that the governing body will be meeting on 27 March to discuss the future location of the college.

  Higher Education
  Mr. McFall
  To ask the Secretary of State for Education and Science if he will make a statement on the implementation of differentiated fees in higher education.

  Mr. Jackson
  I refer the hon. Member to the reply given by my right hon. Friend to my hon. Friend the hon. Member for Rugby and Kenilworth (Mr. Pawsey) on 23 January 1990, at column 600.

  Primary Schools
  Mr. Butler
  To ask the Secretary of State for Education and Science what response his Department intends to make to recent findings by Her Majesty's inspectors of schools relating to the standard of grammar, spelling and punctuation in primary schools.

  Mrs. Rumbold
  HMI's recent report on "The Teaching and Learning of Language and Literacy" concludes that most primary schools devote sufficient time to the teaching of grammar, punctuation and spelling to enable the majority of their pupils to reach adequate standards in these aspects of language but that only a small proportion—under one fifth—perform really well. The Government have already set about raising standards in these aspects of English. The national curriculum attainment targets and programmes of study, which are being introduced progressively from September 1989, reinforce the practices of the most successful schools in teaching grammar, punctuation and spelling. In addition, substantial funding is being provided, through education support grants, for a three-year English language training programme for all primary teachers and other teachers of English.

  Circus Skills
  Mr. Stern
  To ask the Secretary of State for Education and Science if he has any plans to increase the availability of education for circus skills in the United Kingdom.

  Mr. Alan Howarth
  My right hon. Friend has no such plans.

  Modern Languages
  Mr. Flynn
  To ask the Secretary of State for Education and Science what innovations he intends to introduce to increase the number of children receiving tuition in modern languages.

  Mrs. Rumbold
  The national curriculum includes a modern foreign language as a foundation subject at secondary level. That means that a modern foreign language will be studied by all pupils between the ages of 11 and 16 in maintained schools in England and Wales.

  Mrs. Gorman
  To ask the Secretary of State for Education and Science what recent representations he has received from the business community regarding the teaching of foreign languages in schools.

  Mrs. Rumbold
  My right hon. Friend has received no such representations.

  School Buildings (Modernisation)
  Mr. Pike
  To ask the Secretary of State for Education and Science what is his latest estimate of the number of children being educated in schools that are deemed by the local education authority concerned to be in urgent need of modernisation or major repair.

  University of Wales

  1979

  1984

  1988

  Total number

  Per cent, of Welsh domicile

  Total number

  Per cent, of Welsh domicile

  Total number

  Per cent, of Welsh domicile

  Aberystwyth

  1,310

  40

  1,340

  34

  1,472

  31

  Bangor

  1,281

  26

  1,223

  26

  1,437

  26

  Cardiff (inc UWIST)

  3,531

  37

  3,656

  34

  3,797

  36

  St. David's Lampeter

  264

  23

  257

  20

  341

  18

  Swansea

  1,773

  37

  1,821

  34

  1,879

  34

  626
  Mr. Alan Howarth
  The information requested is not collected centrally by the Department.

  Pilot Training
  Mr. Colvin
  To ask the Secretary of State for Education and Science if he will make it his policy to include professional airline and commercial pilot training in the curriculum of universities, polytechnics and colleges of further education.

  Mr. Jackson
  Decisions on which courses to include in an institution's portfolio of educational provision are for the academic authorities within the individual institution.

  Temporary Classrooms
  Mr. Speller
  To ask the Secretary of State for Education and Science what is his policy on the funding of programmes to replace temporary buildings used for primary school classrooms by purpose-built structures.

  Mr. Alan Howarth
  It is for each local education authority to decide whether to make provision in temporary or permanent buildings and to determine its policy on the funding of programmes to replace temporary buildings used for primary school classrooms.

  Student Loans
  Mr. Dalyell
  To ask the Secretary of State for Education and Science what assessment he has made of the effect of the students' loan scheme on the likelihood of graduates entering mathematics, chemistry and physics teaching in schools.

  Mr. Jackson
  Top-up loans will offer eligible students additional resources on favourable terms, regardless of their course or their subsequent choice of career. Repayments will not be burdensome and may be deferred when income is less than 85 per cent. of national average earnings: equivalent to about £11,500 in today's circumstances.

  University of Wales
  Mr. Wigley
  To ask the Secretary of State for Education and Science how many students entered the university of Wales colleges in(a) 1979, (b) 1984 and (c) 1989; and what percentage of the intake hailed from Wales in each instance.

  Mr. Jackson
  The numbers of initial entrants to courses at the colleges of the University of Wales are given in the table. The data cover full-timers and part-timers, and postgraduates and undergraduates.
  627

  University of Wales

  1979

  1984

  1988

  Total number

  Per cent, of Welsh domicile

  Total number

  Per cent, of Welsh domicile

  Total number

  Per cent, of Welsh domicile

  College of Medicine

  239

  48

  138

  67

  234

  47

  Total

  8,398

  36

  8,435

  33

  9,160

  33

  UFC (Scottish Committee)
  Mr. Wallace
  To ask the Secretary of State for Education and Science when he intends to meet the chairman of the Scottish committee of the Universities Funding Council to review its activities in its first year of operation.

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

  Vice-Chancellors and Principles
  Dr. Thomas
  To ask the Secretary of State for Education and Science when he last met representatives of the Committee of Vice-Chancellors and Principals; and what matters were discussed.

  Mr. Jackson
  My right hon. Friend meets representatives of the committee from time to time in the course of normal business.

  Examination Results (Inner London)
  Mr. John Marshall
  To ask the Secretary of State for Education and Science if he will make a statement about trends in examination results in inner London since 1975.

  Mrs. Rumbold
  The table gives the percentage of leavers from the Inner London education authority (ILEA) and for England, obtaining five or more grades at A-C in the GCSE (or its equivalent at O-level and CSE) and one or more A-level passes, since 1976. Although the figures show some improvement in the examination performance of ILEA pupils, the results remain below the national averages. I am sure that the new local education authorities will wish to give a high priority to improving them and will be assisted in this by the Government's education reforms.

  Examination attainments of leavers from maintained schools

  Percentage of leavers

  5 + graded results at GCSE, O-level and CSE (A-C)1

  /+ A-level passes2

  ILEA

  England

  ILEA

  England

  1987–88

  17·5

  26·6

  12·3

  15·2

  1986–87

  14·7

  23·2

  10·4

  13·9

  1985–86

  16·2

  23·6

  10·6

  13·6

  1984–85

  15·2

  23·7

  11·1

  13·9

  1983–84

  15·3

  23·8

  11·1

  14·3

  1982–83

  15·2

  23·3

  10·2

  14·4

  1981–82

  13·8

  23·0

  10·6

  14·1

  1980–81

  14·2

  21·8

  10·6

  13·5

  1979–80

  14·1

  20·9

  9·6

  12·6

  1978–79

  12·7

  20·6

  10·3

  12·6

  1977–78

  14·9

  22·1

  9·8

  14·0

  1976–77

  15·8

  22·0

  13·3

  14·1

  1975–76

  14·9

  21·3

  12·0

  14·3

  1 GCSE grades A-C; O-level grades A-C; CSE grade 1.

  2 Grades A-E.

  Notes:

  (i) The School Leavers Survey, from which the figures in the above table are derived, is based on a 10 per cent. sample
  628
  of pupils at each school. Sampling error may lead to distortion in the trends.

  (ii) The figures above do not provide the overall picture. There has been a growing tendency among 16 year olds in particular to leave school for GCSE/O-level/A-level study in full-time further education.

  UFC (Welsh Committee)
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Education and Science what representations he has received from the Welsh committee of the Universities Funding Council since its creation; and on what matters.

  Mr. Jackson
  My right hon. Friend has received no such representations.

  Education Reform, Northumberland
  Mr. Tredinnick
  To ask the Secretary of State for Education and Science if he will make a statement on the progress of the implementation of the Education Reform Act in Northumberland.

  Mrs. Rumbold
  I refer my hon. Friend to the reply that I gave to my hon. Friend the Member for Hexham (Mr. Amos) on 27 February 1990,Official Report, column 53.

  Higher Education
  Mr. Andrew. F. Bennett
  To ask the Secretary of State for Education and Science if he will make a statement about the number of 16-year-olds staying on in full-time education.

  Mr. Jackson
  In 1988–89, a total of 336,000 16-year-olds stayed on in full-time education in schools and further education colleges in England.

  Student Grants
  Dr. Hampson
  To ask the Secretary of State for Education and Science what, at the latest available figures, is the cost of the older student additional allowance to students' mandatory grants; how many were awarded; and when the allowance was last uprated.

  Mr. Jackson
  In 1987–88, 12,218 assessments totalling £7,546,382 were made for the older students allowance for students receiving mandatory award. The allowance was last uprated with effect from September 1989.

  Mr. Murphy
  To ask the Secretary of State for Education and Science whether students who are following a foundation course which is a prerequisite for entry to a non-science and technology degree course are eligible for mandatory maintenance awards.

  Mr. Jackson
  No.

  Drugs
  Mr. Sheerman
  To ask the Secretary of State for Education and Science what was the cost in the latest year for which figures are available for education programmes designed to reduce the demand for drugs.

  Mr. Alan Howarth
  In 1988–89, the latest year for which figures are available, local education authorities claimed grant on expenditure of £1·6 million under the LEA training grants scheme and £2·6 million under the relevant education support grant in relation to education about drug misuse.

  Building

  Average airborne activity levels (per cent. ALI)

  1983

  1984

  1985

  1986

  1987

  1988

  1989

  B205

  3·0

  2·4

  3·2

  1·6

  3·0

  2·7

  3·4

  B268 TDN

  6·0

  5·5

  3·1

  6·0

  2·6

  3·6

  9·8

  B268 MA Evap

  —

  1·1

  1·0

  1·8

  1·1

  0·8

  0·6

  B30 Inlet

  1·4

  2·6

  1·8

  1·4

  2·4

  3·0

  2·9

  B30 Decanner

  9·0

  8·3

  5·7

  6·2

  4·8

  7·0

  12·4

  Mr. Campbell-Savours
  To ask the Secretary of State for Energy whether readings as registered on personal air samplers worn by British Nuclear Fuels plc. employees working on B/205, B/268 and B/30 at Sellafield have ever failed to match readings as registered on non-battery electrically powered air sampling equipment fitted to the same buildings.

  Mr. Baldry
  Continuously operating air samplers at fixed locations give an average of the aerial radioactivity in the plant and would activate if the levels in the plant rise significantly. Personal air samplers worn by individual employees give a recording of the localised aerial contamination associated with different jobs. The annual exposure recorded by personal air samplers substantially exceeds that measured by installed samplers because individual working practices can generate localised airborne radioactivity which is not expected to be fully recorded by the air sampling equipment.

  Mr. Campbell-Savours
  To ask the Secretary of State for Energy whether, in every case that the alarm monitors in B/205, B/268 and B/30 at Sellafield have been triggered, all personnel have been ordered to leave the area concerned pending suitable clearance by British Nuclear Fuels plc's. health physics department in each year since 1986.

  Mr. Baldry
  Should an individual air sampler alarm, apparently due to radiation, then employees working nearby are expected to move to an adjacent monitored area whilst the reason for the alarm is investigated by a suitably protected person. Should a number of local air samplers alarm, employees are expected to move out of that part of the plant to a mustering point, whilst other employees, suitably protected, investigate the problem. One case of non-compliance occurred in 1986 when the employee sent to investigate an alarm carried, but did not wear, the respiratory protection provided, and received an exposure in excess of the annual limit of intake. Details of

ENERGY

  Sellafield
  Mr. Cambell-Savours
  To ask the Secretary of State for Energy what is the level of suspended radio nuclides in air in B205, B268 and B30 at Sellafield for each year since 1983 as registered at each non-battery electrically powered air sampling point.

  Mr. Baldry
  The annual average airborne alpha activity levels in operating areas of B205, B268 and B30, measured by installed air samplers, are given in the table. Activity levels are presented in terms of the intake a worker would receive from the measured activity in the course of a year's work in the plant and are quoted as percentages of the most restrictive annual limit of intake for the particular radionuclide composition on each plant.

  this were reported in the Health and Safety Executive's quarterly statement on nuclear incidents dated 24 July 1987.

  Wind Energy
  Dr. Thomas
  To ask the Secretary of State for Energy what participation his Department will have in the 1990 European wind energy conference and exhibition.

  Mr. Peter Morrison
  My Department in asociation with the energy technology support unit has submitted two papers describing recent developments under the Government-supported United Kingdom wind energy programme. My Department will be providing an exhibition stand in conjunction with the National Engineering Laboratory. Staff from the energy technology support unit are assisting with the selection of papers.

  Dr. Thomas
  To ask the Secretary of State for Energy what part his Department will take in the British Wind Energy Association's annual conference.

  Mr. Peter Morrison
  My Department is a sponsor of the conference. In association with the energy technology support unit it is collaborating with National Power and PowerGen in a joint exhibition stand. Staff of ETSU are co-authors of two papers. More than one third of the papers will be based on work funded by my Department.

  Regional Functions
  Mr. Caborn
  To ask the Secretary of State for Energy what functions his Department carries out at the regional level; where the regional offices are located in each of the regions; what staff are employed and at what grades; what proportion of his Department's budget is spent in each of the regions; and what geographical boundaries determine his Department's regions.
  631
  Mr. Wakeham
  The only regional service my Department provides is the promotion of energy efficiency. The staff concerned are located in the DTI's regional offices. The details are set out in the table:

  Region

  Location

  Staff

  North East

  Newcastle upon Tyne

  3

  North West

  Manchester

  3

  Yorkshire and Humberside

  Leeds

  3

  East Midlands

  Nottingham

  3

  West Midlands

  Birmingham

  3

  East

  London (moving to Cambridge)

  3

  Greater London

  London

  2

  South

  London

  3

  South West

  Bristol

  3

  The staff in each region are one grade 7, one higher executive officer (HEO) and an administrative officer except in Greater London where there is no HEO. The proportion of my Department's running costs accounted for by these staff is 1·75 per cent. which may be roughly equally divided between the regions.

  Contributions are also made to the Scottish and Welsh Offices for promoting energy efficiency, the amounts representing about 0·1 per cent. of my Department's running costs in each case.

  A breakdown of my Department's total expenditure spent in the regions is not readily available.

  Advertising Expenditure
  Mr. Cohen
  To ask the Secretary of State for Energy what was the total publicity and advertising expenditure, including for privatisation, of his Department and public bodies for which his Department has responsibility in(a) 1979 and (b)

  Mr. Wakeham
  Total expenditure by my Department on publicity and advertising in 1979–80 was £131,000. Final expenditure figures for 1989–90 are not yet available but the current forecast is £3,856,000. I am asking the chairmen of the United Kingdom Atomic Energy Authority, Central Electricity Generating Board, Electricity Council and British Coal to provide their equivalent publicity and advertising figures direct to the hon. Member.

  Safety Directorate
  Mr. Doran
  To ask the Secretary of State for Energy how many inspectors in his Department are required to go offshore in exercise of their responsibilities; how many hold offshore individual certificates; and, in each case, when the individual certificate was issued.

  Mr. Peter Morrison
  All 44 inspectors currently in post may be required to go offshore in exercise of their responsibilities. Every inspector is issued with appropriate warrants by the Secretary of State for Energy immediately after being appointed.

  Mr. Doran
  To ask the Secretary of State for Energy what elements of his Department's safety directorate's tasks are being postponed as a result of staff shortages.

  Mr. Peter Morrison
  The overall aims of the safety directorate, within the framework laid down b) Parliament, are to encourage and guide the efforts of the offshore industry to prevent accidents, to achieve higher 632
  standards of health and safety offshore and to seek to ensure that offshore installations, their equipment, wells and pipelines are structurally sound and fit for their intended purposes, and that they are managed and operated properly. In support of these aims a large number of tasks, of varying degrees of importance, are undertaken. As with any organisation, my safety directorate must prioritise these tasks while ensuring that their aims are met. High priority will continue to be given to offshore inspections and the investigation of accidents offshore; the recruitment campaign currently under way is aimed at ensuring the field inspectorate is brought fully up to strength.

  Mr. Doran
  To ask the Secretary of State for Energy (1) what is the current number of posts for specialist staff within his Department's safety directorate; what is the current number of staff in place; and what plans he has to fill empty posts;

  (2) what is the current number of posts in his Department's safety directorate in Aberdeen and London; what are the current numbers of staff in those posts; and what plans he has to fill empty posts.

  Mr. Peter Morrison
  There are 63 posts for specialist staff in the safety directorate. Five of which are newly created. Fifty specialist staff are in post.

  The total number of posts in the safety directorate 102, 17 of which are in Aberdeen, 84 in London and one in Great Yarmouth. There are 16 staff currently in Aberdeen, 72 in London and one in Great Yarmouth.

  Open and in-service competitions are in progress to fill the specialist vacancies.

  Mr. Doran
  To ask the Secretary of State for Energy what percentage of fatal accidents offshore have been investigated by his Department's safety directorate over the last five years; and how much has been allocated out of departmental resources for 1990–91.

  Mr. Peter Morrison
  It is, and has always been, the policy of my Department to investigate all fatal accidents reported under the Offshore Installations (Inspectors and Casualties) Regulations 1973 and the Submarine Pipe-Lines (Inspectors etc) Regulations 1977. Sufficient resources are always made available for such investigations.

  Offshore Deaths
  Mr. Doran
  To ask the Secretary of State for Energy if he will list all offshore deaths and their employers in the last 10 years.

  Mr. Peter Morrison
  I will write to the hon. Member as soon as possible.

  National Grid Company
  Mr. Alfred Morris
  To ask the Secretary of State for Energy if he will place in the Library the terms of any directions he has given to the National Grid Company under section 58 of the Electricity Act 1989; and if he will make a statement.

  Mr. Baldry
  The Secretary of State has not issued a direction under section 58 of the Electricity Act 1989.

HOME DEPARTMENT

  Rugby League
  Mr. Lofthouse
  To ask the Secretary of State for the Home Department what consideration has been given by his Department to the implications of the Taylor report for rugby league.

  Mr. Hinchliffe
  To ask the Secretary of State for the Home Department what consideration has been given by his Department to the implications of the Taylor report for rugby league.

  Mr. Bradley
  To ask the Secretary of State for the Home Department when he intends to meet representatives of the rugby league to discuss the Taylor report.

  Mr. John Patten
  I refer the hon. Members to the reply given to a question from the hon. Member for Wigan (Mr. Stott) on 19 March at column 493.

  Police Housing Allowances
  Mr. David Porter
  To ask the Secretary of State for the Home Department if he will make a statement about the police force housing allowances.

  Mr. Waddington
  I refer my hon. Friend to the answer I gave on 15 March to my hon. Friend the Member for Uxbridge (Mr. Shersby) at columns 360–61.

  Diminished Responsibility
  Mr. Speller
  To ask the Secretary of State for the Home Department if he has any plans to increase the maximum sentences for those pleading guilty upon the grounds of diminished responsibility to the crimes of killing, raping, or wounding.

  Mr. Patten
  No. Diminished responsibility is a defence only to a charge of murder. The maximum penalty for manslaughter, raping or wounding with intent to do grievous bodily harm is life imprisonment.

  Electronic Tagging
  Mr. John Evans
  To ask the Secretary of State for the Home Department if he will make a statement on the cost effectiveness of electronic tagging of offenders or persons on bail.

  Mr. John Patten
  The current trials of electronic monitoring as a condition of bail have already shown that the technology works and that operating procedures are effective. We are now considering the case for a larger-scale trial of electronic monitoring in an area where substantial numbers can be monitored as a condition of bail, with a view to providing improved measures of the cost effectiveness of electronic monitoring.

  Birmingham Six
  Mr. Alexander
  To ask the Secretary of State for the Home Department what action he has taken in the light of recent representations submitted to him about the safety of the convictions of the Birmingham Six.

  Mr. Waddington
  I have asked the chief constable of the West Midlands police for a report on a number of specific 634
  points which have been put to me recently about the safety of the convictions of the Birmingham Six. I understand that the chief constable has decided to ask the Devon and Cornwall constabulary, which carried out investigations in 1987 into certain aspects of the case, to investigate the matters now under consideration. In the light of the outcome of those investigations, I will give further consideration to whether my intervention in the convictions of the six men would be justified.

  Magistrates Courts Service
  Mr. David Martin
  To ask the Secretary of State for the Home Department what action he proposes to take on the recommendation in the report of the scrutiny of the magistrates' courts service that the service should become an executive agency.

  Mr. Waddington
  I am very grateful for the detailed consideration which has been given to the report by interested bodies and individuals, and for the comments which they have offered. In the light of the consultations which have taken place since the report was published we now wish to obtain more detailed and accurate estimates of the costs of different options for changing the management structure and organisation of the service. These will cover both the executive agency proposals made in the scrutiny report and, for comparison purposes, an alternative model based on a reduced number of separate management units funded 100 per cent. by central Government but independently managed by local boards. Consultants will be appointed for this purpose. I shall not reach firm decisions about the future organisation of the service until I have had an opportunity to consider the results of this costing assessment.

  British Citizenship
  Mrs. Maureen Hicks
  To ask the Secretary of State for the Home Department whether his Department has completed consideration of applications for registration as British citizens made under the transitional provisions of the British Nationality Act 1981; and if he will make a statement.

  Mr. Peter Lloyd
  The transitional provisions of the British Nationality Act 1981 came to an end on 31 December 1987. The number of applications received in 1987–88 was some 210,000 registrations and 70,000 naturalisations, of which 116,000 were received in December 1987 alone. This was far more than expected and the Government responded to the additional demand by providing more resources, including the establishment of the Liverpool nationality office, tasked with processing the remaining transitional registration applications by March 1990.

  By 19 January 1990, decisions had been reached on all registration cases being processed at the Liverpool nationality office, except those where replies from applicants were awaited. These latter cases consist of those where we are waiting for the applicant to forward the fee, or to swear an oath of allegiance, or to send some other documentary evidence to establish an entitlement to registration. The time taken to complete these outstanding applications will depend upon how soon we receive the requisite information. So far, some 110,000 applications have been completed out of a total of 130,000.
  635
  Now that the Liverpool nationality office has largely completed the processing of registration applications, its staff have been retrained in order to process applications for naturalisation, which until now have been processed only in Croydon. This additional capacity to process naturalisations will improve the level of service given to applicants during 1990–91, and we aim to reduce the average waiting time for decisions on applications of all kinds to 11 months by April 1991.

  Breath Tests
  Mr. Shersby
  To ask the Secretary of State for the Home Department whether a decision has been reached on police powers to require roadside breath tests.

  Mr. Waddington
  Yes. The Government have concluded that the police have adequate powers to require roadside breath tests.

  The full circumstances in which a breath test can be required were set out by my right hon. and learned Friend the Attorney-General on 5 December 1989 at column 131 and my right hon. and learned Friend the Secretary of State for Scotland at column 165. It is lawful for a police officer in uniform acting in the execution of his duty to require the driver of any vehicle on a road to stop. A police officer who stops a vehicle on a road with the purpose of investigating whether its driver has alcohol in his body is acting in the execution of his duty. It is accordingly lawful for a police officer in uniform to stop vehicles at random for that purpose, provided there is no malpractice such as oppression or capricious conduct on the part of the officer. It is lawful for a police officer in uniform to require a driver who has been stopped in such circumstances to provide a specimen of breath for a breath test, provided that the officer has reasonable cause to suspect that the driver has alcohol in his body.

  We have considered carefully the views expressed during our recent consultations that the police should be able to operate high profile enforcement as a deterrent against drink driving. Their present powers allow them to do so and statistics show that they are using their powers to good effect.

  The statistics of breath tests for England and Wales for the 12 months to September 1989, which were published on 7 February, show that overall levels of testing continue to rise, with a continued downward trend in the proportion of positive tests. The police reported 502,000 screening breath tests in this period, a rise of 16 per cent. over the previous year. The provisional figures for the Christmas period reported by the Association of Chief Police Officers show that the proportion of positive tests fell from 10 per cent. in 1988 to 9 per cent. in 1989.

  In all circumstances, we have concluded that the existing powers strike the right balance between the need for effective enforcement of the law and the freedom of the individual.

  Advertising Expenditure
  Mr. Cohen
  To ask the Secretary of State for the Home Department what was the total publicity and advertising expenditure of his Department and public bodies for which his Department has responsibility in(a) 1979 and (b)

  Mr. Waddington
  Expenditure on publicity and advertising was as follows:
  636

  1979–80

  1989–90 (estimate)

  £ million

  £ million

  3·0

  9·1

  Psychiatric Bail Hostels
  Mr. Cohen
  To ask the Secretary of State for the Home Department whether he has any proposals to institute a system of psychiatric bail hostels; and if he will make a statement.

  Mr. John Patten
  We are examining the part bail hostels can play in a strategy for dealing with mentally disturbed defendants, but no decisions have yet been taken.

  Drugs
  Mr. McAvoy
  To ask the Secretary of State for the Home Department what was the cost in the latest year for which figures are available of education programmes designed to reduce the demand for drugs.

  Mr. Mellor
  A major part of the overall cost of education aimed at preventing the misuse of drugs is that of the staff and other resources used to provide drugs education within schools. Information on such costs is not available centrally.

  However, the Department of Education and Science supported expenditure of £4·2 million in 1988–89 to allow for the continued employment of drugs education co-ordinators in each local education authority area in England and for in-service teacher training. In the same period, similar central expenditure to support drugs education in Scotland and Wales amounted to some £260,000 and £280,000 respectively.

  Regional Functions
  Mr. Caborn
  To ask the Secretary of State for the Home Department what functions his Department carries out at the regional level; where the regional offices are located in each of the regions; what staff are employed and at what grades; what proportion of his Department's budget is spent in each of the regions; and what geographical boundaries determined his Department's regions.

  Mr. Waddington
  The main functions organised regionally are in the prison service, passport department and the forensic science service. Others include police training, telecommunications, police and fire service inspection, inspections relating to the control of drugs, the United Kingdom warning and monitoring organisation, and the inspection of laboratories engaged in scientific procedures on animals.

  There are no standard Departmental regions, and thus no Home Office regional offices. Each regional organisation is separately constructed according to the needs of the particular function concerned.

  Only in the prison service is there devolved budgetary responsibility on a regional basis. Details of its regional offices' location and approximate staff numbers and 1989–90 budgets are set out in the table below. Since regional offices in the prison service are responsible for staff and expenditure in all prison establishments in their regions, the figures similarly include all such staff and expenditure.
  637

  Region

  Staff-in-post

  Total budget £ million 1989–90

  South East (Woking)

  10,500

  220

  South West (Bristol)

  5,100

  105

  Midlands (Birmingham)

  5,900

  121

  North (Manchester)

  9,900

  201

  Neighbourhod Drugwatch
  Mr. Butler
  To ask the Secretary of State for the Home Department whether he intends to offer any assistance to neighbourhood drug watch schemes.

  Mr. Mellor
  We welcome local efforts to prevent and reduce the extent of drug misuse, especially where they have the support of the local community. In areas where drug prevention teams are set up under the initiative announced by my right hon. Friend the Member for Witney (Mr. Hurd) last October, I would expect the team to establish close contact with any local neighbourhood drugwatch scheme.

DEFENCE

  Submarine-launched Cruise Missiles
  Mr. Andrew F. Bennett
  To ask the Secretary of State for Defence if any studies by SACEUR are under way to examine the role of United States Navy submarine-launched cruise missiles as a part of the NATO theatre nuclear forces.

  Mr. Neubert
  As part of the post-INF restructuring of nuclear forces, SACEUR is looking at the availability of a whole spectrum of nuclear weapons, including submarine-launched cruise missiles.

  Mr. Andrew F. Bennett
  To ask the Secretary of State for Defence if any United States Navy Tomahawk submarine-launched cruise missiles are assigned to the NATO command (i) in peacetime and (ii) in war.

  Mr. Neubert
  The assignment of United States forces is a matter for the United States Government.

  Mr. Andrew F. Bennett
  To ask the Secretary of State for Defence if he will make a statement concerning progress by the NATO military authorities in developing concepts of military operations for the employment of United States Tomahawk submarine-launched cruise missiles.

  Mr. Neubert
  While it is not our practice to comment in detail on NATO's classified concepts of operations, I can confirm that the NATO military authorities are considering the availability of submarine-launched cruise missiles as part of NATO's post-INF restructuring process.

  Mr. Andrew F. Bennett
  To ask the Secretary of State for Defence if United States submarine-launched cruise missiles are currently included in the NATO operational plan for the employment of nuclear weapons.

  Mr. Neubert
  It is not our practice to comment on classified NATO operational plans.

  United Kingdom-United States Agreements
  Mr. Andrew F. Bennett
  To ask the Secretary of State for Defence what provisions currently exist in agreements between the British Government and United States authorities concerning the types of (i) naval and (ii) naval support vessels permitted to be based in United Kingdom ports and facilities.

  Mr. Neubert
  Details of agreements under which United States vessels may be based in the United Kingdom are confidential between the two Governments.

  Running Costs
  Mr. John Evans
  To ask the Secretary of State for Defence what are the annual running costs of an operational (i) Polaris class submarine, (ii) Trafalgar class submarine, (iii) Swiftsure class submarine and (iv) Valiant/Churchill class submarine; and what is the anticipated annual running cost of a Trident class submarine; and if he will make a statement.

  Mr. Neubert
  The average annual operating costs at 1988–89 prices of Royal Navy nuclear-powered submarines are:

  £ million

  Polaris

  11·7

  Fleet

  4·4

  Figures for individual classes of fleet submarine could not be provided without disproportionate cost.

  These costs include personnel, petrol, oil and lubricants, spares and so on, as well as administrative support services, but exclude capital equipment and refit/repair costs.

  It is too early to say with any precision what the likely running costs of the Trident force will be. They are not, however, expected to be significantly different from those of Polaris.

  Mr. John Evans
  To ask the Secretary of State for Defence what are the annual running costs of the Atomic Weapons Research Establishment at(a) Burghfield, (b) Aldermaston, (c) Foulness, (d) Winfrith, (e) Llanishen, (f) Harwell, (g) Springfields, (h) Capenhurst, (i) Calder Hall, (j) Sellafield and (k) Capelcross, and if he will make a statement.

  Mr. Neubert
  It would not be in the national interest to disclose this information for the four sites of the atomic weapons establishment: Aldermaston, Burghfield, Cardiff (Llanishen), and Foulness. The other locations to which the hon. Member refers are not a matter for the Ministry of Defence.

  Nuclear Weapons
  Mr. John Evans
  To ask the Secretary of State for Defence what is the number of people employed both directly and indirectly in the nuclear weapons programme; how many are involved in research; how many are involved in manufacture; what are the running costs of employing these personnel, and if he will make a statement.

  Mr. Neubert
  It would not be in the interests of national security to reveal the number or deployment of staff at the
  639
  atomic weapons establishment. However our very broad estimate of the number of people in the United Kingdom whose employment is directly or indirectly dependent on nuclear defence is some 40,000.

  Tornados (Collision)
  Mr. Jopling
  To ask the Secretary of State for Defence whether, in the light of the report of the collision between two Tornado aircraft over Cumbria on 9 August 1988, he will accelerate his plans to introduce a computerised system of track deconfliction to avoid a similar accident in future; and on which date he expects to implement it.

  Mr. Neubert
  Immediately following the accident concerned and in the light of the interim report of the investigation, a review of night low flying regulations was carried out which resulted in the introduction of a restructured night low flying system in October 1988 designed to provide improved deconfliction arrangements. The automated low flying inquiry and notification system (ALFENS), which is currently in its project definition phase, should improve the flexibility of the night low flying system on its introduction in 1992, but there are no plans to accelerate its development in the light of the final report of the accident investigation.

SOCIAL SECURITY

  Housing Benefit Disregards
  Mr. Hind
  To ask the Secretary of State for Social Security if he has any plans following the publication of the Children's Society report, "Too Much Pressure", to introduce the same disregards for housing benefit for trainees on YTS as currently enjoyed by young people in employment; and if he will make a statement.

  Mrs. Gillian Shephard
  Allowances paid to trainees on youth training schemes are provided from central funds. Like social security benefits, these allowances are taken fully into account in the calculation of housing benefit. To provide a disregard of these allowances would mean double provision from public funds and give preferential treatment to a small number of people who are not in the greatest need. However, in July 1989, we accepted that there were special considerations for young people aged 16 and 17 who were living independently and liable to make payments for their housing costs and increased the personal allowance which forms the basis of their housing benefit entitlement to the same level as that used for people aged 18 to 25—an increase of over 30 per cent.

  Attendance Allowance
  Mr. Chris Smith
  To ask the Secretary of State for Social Security how many people claiming attendance allowance on grounds of terminal illness in each of the last three years for which records are available have died while waiting for the six-month qualifying period to expire.

  Table 3

  Numbers of staff, and grade in which currently employed in regional offices—1March 1990

  MIDS

  LN

  LS

  SCOT

  NW

  NE

  WSW

  Totals

  Executive director

  0·0

  0·0

  0·0

  1·0

  0·0

  0·0

  0·0

  1·0

  Assistant secretary

  1·0

  1·0

  1·0

  0·0

  1·0

  1·0

  1·0

  6·0

  Senior principal

  5·0

  5·0

  5·0

  4·0

  5·0

  5·0

  5·0

  34·0

  Principal

  6·0

  6·0

  8·0

  7·0

  8·0

  6·0

  6·0

  47·0

  640
  Mr. Scott
  I regret that this information is not available.

  Regional Functions
  Mr. Caborn
  To ask the Secretary of State for Social Security what functions his Department carries out at the regional level; where the regional offices are located in each of the regions; what staff are employed and at what grades; what proportion of his Department's budget is spent in each of the regions; and what geographical boundaries determine his Department's regions.

  Mrs. Gillian Shepherd
  The Department's regional offices provide a support and advice service to the local office network, details of specific functions are shown in table 1. Information on location, staffing and boundaries are also detailed in tables 2, 3 and 5. Information on budgets in the format requested is not available. Table 4 gives details showing the expenditure for the regional and local offices in each region as a proportion of the Secretary of State's administration and miscellaneous services vote.

  Table 1

  Functions carried out at regional level

  1

  Regional support and advice on adjudication and policy matters relating to all national insurance and social security benefits.

  2

  Enforcement procedures in respect of non compliance with national insurance regulations.

  3

  Organised fraud, policy and advice on all fraud related matters.

  4

  Personnel matters, staff welfare and training.

  5

  Industrial relations, regional Whitley committee.

  6

  Implementation of Department's computerisation and new technology policies.

  7

  Regional estate management.

  8

  Freeline and regional information services.

  Table 2

  Location of regional offices

  1

  Scotland—Edinburgh.

  2

  Midlands—Birmingham.

  3

  London South—Sutton, Surrey.

  4

  London North—Wembley, Middlesex.

  5

  North East—Leeds.

  6

  North West—Bootle.

  7

  Wales and South West—Cardiff.

  641

  MIDS

  LN

  LS

  SCOT

  NW

  NE

  WSW

  Totals

  SEO

  25·5

  25·5

  26·0

  28·0

  30·0

  26·5

  23·0

  184·5

  HEO

  112·0

  90·0

  110·5

  102·0

  95·0

  106·5

  85·0

  701·0

  LOI

  116·0

  145·0

  139·5

  150·0

  105·0

  154·0

  74·0

  883·5

  EO

  136·5

  99·5

  146·5

  142·5

  156·5

  112·0

  131·0

  924·5

  LOII

  296·5

  188·5

  81·0

  294·0

  103·5

  184·0

  177·0

  1,324·5

  AO

  143·0

  75·5

  145·0

  91·5

  227·5

  154·5

  174·0

  1,011·0

  AA

  763·5

  172·0

  89·0

  521·5

  659·5

  513·5

  717·5

  3,436·5

  Typing manager

  2·0

  2·0

  3·0

  3·0

  3·0

  2·0

  2·0

  17·0

  Typist

  22·5

  21·5

  25·5

  23·5

  28·0

  25·0

  20·5

  166·5

  PES

  8·0

  4·0

  6·0

  7·0

  8·0

  10·0

  4·0

  47·0

  Handicap instructor

  1·0

  1·0

  1·0

  1·0

  1·0

  1·0

  1·0

  7·0

  MED/board assistant

  0·0

  0·0

  0·0

  0·0

  2·0

  0·0

  2·0

  4·0

  SM3

  0·0

  0·0

  1·0

  0·0

  1·0

  0·0

  0·0

  2·0

  Support grade 1

  5·0

  2·0

  2·0

  0·0

  3·0

  6·0

  5·0

  23·0

  Support grade 2

  19·0

  8·0

  13·0

  7·5

  19·0

  13·0

  15·0

  94·5

  Professionals

  2·0

  2·5

  2·5

  0·0

  2·0

  3·0

  3·0

  15·0

  Totals

  1,658·5

  843·0

  799·5

  1,378·5

  1,452·0

  1,317·0

  1,440·0

  8,888·5

  Table 4

  Proportion of the Department's administration budget spent in each region

  Per cent.

  1. Scotland

  4·75

  2. Midlands

  5·38

  3. London South

  6·37

  4. London North

  6·37

  5. North East

  5·63

  6. North West

  5·45

  7. Wales and South West

  4·79

  Table 5

  Geographical boundaries of each region

  Region

  Boundaries

  1. Scotland

  Scotland including the Islands.

  2. Midlands

  Derbyshire excluding High Peak District, Herefordshire, Worcestershire, Leicestershire, Lincolnshire, Northamptonshire, Nottinghamshire, Shropshire, Staffordshire, Warwickshire and West Midlands.

  3. London South

  Hampshire, Berkshire, Watlington, Nettlebed and Henley on Thames in Oxfordshire, all areas south of Thames, Kensington, Bloomsbury, Chelsea, City and Westminster to north of Thames

  4. London North

  Essex, Bedfordshire, Norfolk, Suffolk, Cambridgeshire, Oxfordshire excluding small area covered by London South, Hertfordshire and the old GLC area north of Thames except Kensington, Bloomsbury, Chelsea, City and Westminster.

  5. North East

  Northumberland, Tyne and Wear, Durham, Yorkshire, Humberside and North Lincolnshire.

  6. NorthWest

  Cumbria, Lancashire, Merseyside, Cheshire, Greater Manchester and High Peak District Derbyshire.

  7. Wales and South West

  Clwyd, Powys, Gwent Gloucestershire, Wiltshire and Dorset.

  Vaccine Damage
  Mr. Ashley
  To ask the Secretary of State for Social Security how many vaccine damage payments were made in 1989; and if he will categorise these according to the age of the child when the vaccination took place, the year of the vaccination and the nature of the vaccination.

  Mrs. Gillian Shephard
  Three payments were awarded in 1989 under the provisions of the Vaccine Damage Payments Act 1979. The details are:

  Age at date of vaccination

  Year vaccination was given

  Type of vaccination cited on claim form

  4 years

  1986

  Measles

  12 to 15 months

  1986

  Measles

  15 to 18 months

  1972

  Measles

  Correspondence
  Mr. Kennedy
  To ask the Secretary of State for Social Security when he expects to be able to resolve the still outstanding claim for child benefit, from the Rev. John Macleod, of Ross-shire, on whose behalf the hon. Member for Ross, Cromarty and Skye wrote to him on 13 February and 13 March; why an interim payment has not been made; and if he will make a statement.

  Mrs. Gillian Shephard
  There is no outstanding claim for child benefit but I am aware of an outstanding claim for family credit from Mrs. Macleod. Claims for family credit are decided by the independent adjudicating authorities and we cannot interfere in their decisions. I understand that the adjudication officer dealing with Mrs. Macleod's claim is awaiting further information from her before being able to decide the claim. As my noble Friend, Lord Skelmersdale said in his letter to the hon. Member on 8 March 1989, the claim about which the hon. Member wrote on 23 January 1989 was decided on 1 March 1989 when an award of £41·60 a week was made. As a result of an appeal to the social security appeal tribunal, the decision was revised to £58·57 a week and arrears were paid on 1 December 1989.

  Rent Relief
  Mr. Austin Mitchell
  To ask the Secretary of State for Social Security (1) what is his estimate of the numbers qualifying for rent relief in each region and the amount and distribution of such relief in terms of the amount of relief;

  Region

  Number receiving assistance with rent

  (000s) Proportion of Great Britain total Per cent.

  Expenditure £ million

  Proportion of Great Britain total Per cent.

  Northern

  315

  8

  285

  7

  Yorkshire and Humberside

  413

  10

  357

  9

  East Midlands

  253

  6

  221

  5

  East Anglia

  117

  3

  105

  3

  Greater London

  572

  14

  765

  19

  South East

  522

  13

  509

  12

  South West

  249

  6

  245

  6

  West Midlands

  394

  9

  372

  9

  North West

  536

  13

  512

  13

  Wales

  211

  5

  215

  5

  Scotland

  573

  14

  508

  12

  Total

  4,155

  100

  4,094

  100

  Region

  Number receiving assistance with rates (000s)

  Proportion of England and Wales total Per cent.

  Expenditure £ million

  Proportion of England and Wales total Per cent.

  Northern

  359

  8

  95

  8

  Yorkshire and Humberside

  498

  11

  120

  10

  East Midlands

  317

  7

  86

  7

  East Anglia

  142

  3

  35

  3

  Greater London

  630

  14

  237

  19

  South East

  641

  15

  183

  14

  South West

  322

  7

  76

  6

  West Midlands

  506

  12

  154

  12

  North West

  695

  16

  229

  18

  Wales

  253

  6

  50

  4

  Total

  4,363

  100

  1,265

  100

  Retirement Pension
  Mr. Burns
  To ask the Secretary of State for Social Security if he will list other European Economic Community countries that decide the date for the commencement of payment of the retirement pension along the same lines as Regulation 16(1) of the Social Security (Claims and Payments) Regulations 1987; and if he will make a statement.

  Mrs. Gillian Shephard
  [holding answer 27 February 1990]: In the United Kingdom, state retirement pensions are payable in advance from the day on which the person becomes entitled to a pension, if this is a Monday, or if not, from the following Monday.

  Arrangements in other European Community member states differ from each other, with pensions usually being paid monthly rather than weekly. In Denmark, Italy and Spain, the first pension payment is made at the beginning of the month following the qualifying day, but includes a payment backdated to the qualifying day. In the Netherlands, the pensioner is entitled to pension from the beginning of the month of his qualifying birthday.
  644
  (2) What is his estimate of the numbers qualifying for rate relief in each region and the amount and distribution of such relief in terms of the amount of relief.

  Mrs. Gillian Shephard
  [holding answer 22 February 1990]: The information is in the table.

  In Belgium, France, Luxembourg and Germany, the first pension is payable at the start of the month following the qualifying day, without any payment for the intervening period.

  In Ireland, where pensions are paid weekly, the first payable date is decided as in the United Kingdom.

  I regret it has not proved possible to obtain comparable information about the position in Greece and Portugal.

  Travel-to-Work Costs
  Mr. Meacher
  To ask the Secretary of State for Social Security what is the survey evidence suggesting that one in three employees may have no travel-to-work costs referred to in paragraph 37, chapter 14 of the public expenditure White Paper.

  Mrs. Gillian Shephard
  [holding answer 5 March 1990]: This estimate is based on the findings of a study carried out by the university of Stirling for Her Majesty's Treasury in 1980.

  Pensions
  Mr. Meacher
  To ask the Secretary of State for Social Security how many rebates have still not been paid to the personal pension schemes of people who opted out of the state earnings-related pension scheme.

  Mrs. Gillian Shephard
  [holding answer 12 March 1990]: It is estimated that there are 15,500 individuals who are entitled to a rebate for their personal pension and where it has not yet been paid into their scheme. About 11,000 of these are expected to have a payment at the end of March. Investigations are continuing in the remaining cases to resolve discrepancies in the information provided by employers, and payment will then be made where appropriate.

  Housing Benefit
  Mr. Mitchell
  To ask the Secretary of State for Social Security (1) further to the written reply dated 14 February,Official Report, column 222, concerning the amount of poll tax payable in 1990–91 per adult for each region, etc., whether he will provide in each case an estimate of the numbers receiving housing benefit;

  (2) further to the written reply dated 14 February, Official Report, column 222, concerning the amount of poll tax payable in 1990–91 per adult for each region, etc., whether he will provide in each case an estimate of the numbers receiving rate relief.

  Mrs. Shephard
  The information requested has been placed in the Library.

SCOTLAND

  Teucharhill
  Mr. Sillars
  To ask the Secretary of State for Scotland when he received an urban aid application for projects in the Teucharhill area of Govan constituency; and what decisions have been made.

  Mr. Lang
  Applications for the 1990–91 urban programme competition for projects in the Teucharhill

  Programme 15.2: Industry, Energy, Trade and Employment

  Programme 15.3: Tourism

  £ million

  1983–84

  1984–85

  1985–86

  1986–87

  1987–88

  1988–89

  1989–90

  (a) Gross expenditure

  Regional and general industrial support:

  Regional selective assistance and related schemes

  26·1

  37·0

  52·7

  43·3

  45·5

  62·1

  64·3

  Regional development grants

  143·0

  109·0

  106·3

  168·5

  77·4

  60·3

  63·7

  Other support services (oil platform sites)

  0·9

  0·6

  0·1

  0·0

  0·0

  0·0

  0·0

  Total

  170·0

  146·6

  159·1

  211·8

  122·9

  122·4

  128·0

  Support for nationalised industries (other than transport industries)

  5·7

  3·9

  2·0

  4·5

  6·8

  4·0

  4·1

  General labour market services (The Careers Service)

  8·4

  8·7

  9·4

  9·6

  11·0

  13·5

  14·0

  Other Central and miscellaneous services

  0·3

  0·4

  0·4

  0·7

  0·4

  0·6

  0·5

  Total

  184·4

  159·6

  170·9

  226·6

  141·1

  140·5

  146·6

  Public Corporations

  Other regional support—Highlands and Islands

  Development Board

  38·2

  42·1

  39·7

  35·5

  37·9

  42·1

  46·9

  Scottish Development Agency

  115·5

  118·0

  131·0

  130·5

  135·0

  145·9

  160·3

  Total

  153·7

  160·1

  170·7

  166·0

  172·9

  188·0

  207·2

  646
  area were received by the normal 30 November deadline. As in previous years I expect the bulk of final decisions to be announced around the end of March.

  Advertising Expenditure
  Mr. Cohen
  To ask the Secretary of State for Scotland what was the total publicity and advertising expenditure, including for privatisation, of his Department and public bodies for which his Department has responsibility in(a) 1979 and (b)

  Mr. Rifkind
  The latest estimate of expenditure by the Scottish Office in the current financial year on publicity and advertising is £3 million. The corresponding figure for the financial year 1979–80 was £263,000. Information on publicity and advertising expenditure by non-departmental public bodies is not held systematically in my Department.

  Highlands and Islands Development Board
  Mr. Worthington
  To ask the Secretary of State for Scotland if he will publish in the Official Report tables, covering the years 1983–84 to 1991–92 and consistent with the table for programmes 2 and 15.3 on page 40 of "Public Expenditure to 1991–92: A Commentary on the Scotland Programme", showing (a) gross expenditure, parallel to the table appended to the Secretary of State's statement to the House on 6 December 1989, Official Report, columns 330–33 and (b) a table of receipts, following as closely as is practicable the receipts analysis for the Highlands and Islands Development Board on page 47 of the said commentary.

  Mr. Lang
  [holding answer 17 January 1990]: Gross expenditure on programmes 15.2 and 15.3 for the period 1983–84 to 1989–90 is set out in the table. Details of expenditure plans for the financial years 1990–91 and 1991–92 will be set out in the Scottish commentary on public expenditure to 1992–93 which will be published in due course.

  An analysis of receipts for the Scottish Development Agency is not available in the form requested.
  647

  1983–84

  1984–85

  1985–86

  1986–87

  1987–88

  1988–89

  1989–90

  Total IETE

  338·1

  319·7

  341·6

  392·6

  314·0

  328·5

  353·8

  Tourism: Programme 15.3

  11·5

  13·4

  12·7

  13·7

  13·8

  15·8

  16·8

  Living Elsewhere Grants
  Mr. Worthington
  To ask the Secretary of State for Scotland how many students at each university and higher education college in Scotland receive living elsewhere grants.

  Mr. Lang
  [holding answer 22 January 1990]: The information requested is set out in the table. It relates to the academic session 1988–89 and is in respect of Scottish-domiciled students attending the Scottish universities and Scottish grant-aided colleges.

  Institution

  Number of Students

  Glasgow University

  3,295

  Edinburgh University

  2,977

  Strathclyde University

  1,843

  Aberdeen University

  2,221

  Heriot-Watt University

  1,072

  St. Andrews University

  804

  Dundee University

  1,153

  Stirling University

  1,123

  Jordanhill College of Education

  599

  Moray House College of Education

  746

  Northern College of Education

  499

  St. Andrews College of Education, Glasgow

  267

  Craigie College of Education

  135

  Robert Gordons Institute of Technology

  1,622

  Duncan of Jordanstone School of Art

  517

  Dundee Institute of Technology

  862

  Paisley College of Technology

  865

  Glasgow School of Art

  316

  The Queens College

  361

  Queen Margaret College

  690

  Edinburgh College of Art

  272

  Royal Scottish Academy of Music and Drama

  119

  Scottish College of Textiles

  414

  West of Scotland Agricultural College

  67

  North of Scotland College of Agriculture

  39

  East of Scotland School of Agriculture

  27

  Napier Polytechnic of Edinburgh

  2,342

  Glasgow College of Technology

  980

  Fishing, Ullapool
  Mr. Charles Kennedy
  To ask the Secretary of State for Scotland when he expects to be able to reply to the specific questions raised with him by the Federation of Highlands and Islands fishermen in its original letter of 3 May 1989 with regard to the impact of klondyking activity upon the fishing activities of Ullapool fishermen and the question of possible compensation; and if he will make a statement.

  Mr. Lang
  [holding answer 14 March 1990]: The question of compensation for loss of fishing opportunities has been raised by the federation, and by the hon. Member on its behalf, on previous occasions. My noble Friend the Minister of State told representatives of the federation at a meeting in Kinlochbervie in August 1989 that the Government do not intend to pay compensation.

  Nature Conservation
  Mr. Macdonald
  To ask the Secretary of State for Scotland, pursuant to his reply to the hon. Member for Western Isles,Official Report, 1 March, column 292,
  648
  whether he will indicate the criteria adopted for the purposes of determining whether land which is subject to, or being considered for, a nature conservation order under section 29 of the Wildlife and Countryside Act 1981 is of national importance.

  Lord James Douglas-Hamilton
  [holding answer 12 March 1990]: A nature conservation order is made on the recommendation of the Nature Conservancy Council only where it is satisfied that there is a serious threat to an SSSI. The Nature Conservancy Council would advise on the scientific interest and the importance of the specific area in a national and international context. Each case is then considered by my right hon. and learned Friend on its merits.

TRANSPORT

  Traffic
  Mr. Gerald Bowden
  To ask the Secretary of State for Transport what consideration he has given to the need for environmental measures to mitigate the effect of increased volume of traffic on roads in residential areas.

  Mr. Atkins
  Where there is sufficient capacity on main roads, traffic-calming measures such as road humps arid variable carriageway widths can play a useful part in enhancing the environmental quality of many residential streets. Their principal effects are to lower traffic speeds and to deter through traffic from using these streets. Improved landscaping and paved surfaces can offer further environmental benefits.

  East London Roads
  Ms. Gordon
  To ask the Secretary of State for Transport (1) if he will make it his policy to accede to any renewal of the request from the local authority to close the exits from the northern Blackwall tunnel approach road at Old Ford/Tredegar road to prevent westbound rat-running;

  (2) if he will visit Antill road and Tredegar road in Bow, London, E3 to meet residents to discuss the problems caused by through traffic leaving trunk roads.

  Mr. Atkins
  No. It is for the appropriate borough council as highway authority for the local roads concerned to make specific proposals which will be considered on the basis of circular 2/87 traffic management guidance in London.

  Cyclists
  Mr. Summerson
  To ask the Secretary of State for Transport what records he has of accidents involving cyclists in Kensington road, Knightsbridge, Park lane, Bayswater road, and Marylebone road over the last five years.

  Mr. Atkins
  I understand from the London accident analysis unit that for the five-year period 1984 to 1988, the latest year for which figures are available, the number of accidents involving cyclists was:
  649

  Road

  Number of accidents

  Kensington Road

  37

  Knightsbridge

  25

  Park Lane

  39

  Bayswater Road

  50

  Marylebone Road

  42

  Regional Functions
  Mr. Caborn
  To ask the Secretary of State for Transport what functions his Department carries out at the regional level; where the regional offices are located in each of the regions; what staff are employed and at what grades; what proportion of his Department's budget is spent in each of the regions; and what geographical boundaries determine his Department's regions.

  Mr. Atkins
  The Department has a wide range of functions, most of which are undertaken outside London. Some 80 per cent. of its 16,500 staff are based outside London. It has nine regional offices which deal with local aspects of road traffic, road safety and public transport in Newcastle, Leeds, Manchester, Nottingham, Birmingham, Bedford, London, Dorking and Bristol with a sub-office in Exeter. The new motorway widening unit will be in Coventry. We have recently announced our intention to relocate the highways computing division from London to Leeds.

  The Department's marine directorate and Her Majesty's Coastguard have their own regional organisations, as do the vehicle inspection agency and the driver and vehicle licensing directorate, the new driver standards agency and traffic areas which supervise driver testing, vehicle safety and operator licences. The transport and road research laboratory is at Crowthorne. The different boundaries of each organisation are set in order to ensure value for public money and to best deliver each organisation's objectives.

  Maps showing the nine regional offices and their schemes were published in February in "Trunk Roads, England, Into the 1990s". The roads vote of £1·3 billion is almost entirely spent by the regional organisation and the effort of the agencies and directorates listed above is deployed in the regions.

  Cars (Pollution)
  Mr. Martyn Jones
  To ask the Secretary of State for Transport what action he intends to take over calls for the inclusion of a pollution test in the MOT tests.

  Mr. Atkins
  I refer the hon. Member to the answer I gave the hon. Member for Dewsbury (Mr. Taylor) on 6 March 1990(Official Report, column 547.)

  North Yorkshire County Council (Grants)
  Mr. Robert Banks
  To ask the Secretary of State for Transport if he will set out the additional amounts in grants to the North Yorkshire county council which will be available in future years as a result of the increased spending announcement.

  Mr. Atkins
  In the 1990–91 transport supplementary grant (TSG) settlement, announced last December, we accepted for the first time expenditure on the Sherburn-inElmet and South Milford bypass for 50 per cent. Grant 650
  support. Subject to North Yorkshire county council making satisfactory progress, we expect to pay TSG of over £5·7 million towards the cost of this scheme between now and its completion in 1992–93. During this same period, support for the Harrogate Knaresborough southern bypass is expected to continue with TSG of some £5·2 million. The county council will also receive increases in revenue support grant over a longer period to cover the cost of funding the balance.

  Road Improvements
  Mr. Robert Banks
  To ask the Secretary of State for Transport what arrangements he has made to inform the public about road repairs and improvements on trunk roads where restrictions are in force with consequent delays for traffic movement.

  Mr. Atkins
  The Department issues fortnightly bulletins summarising planned major motorway lane closures likely to involve delays, and its regional offices issue more detailed information on individual schemes. This information is publicised by the media. For certain roadworks the Department provides telephone hot-lines from which information on likely delays is available directly to the public. The Department also publishes leaflets that give details of telephone numbers and other sources of information.

  Signs are being introduced at major roadworks to explain what the works are for and what is happening when work is suspended while cones are still in place.

  The broadcast media and motoring organisations play a major part in providing the public with reports on road conditions. The Department is having discussions with those involved in the provision of travel information about ways of improving its availability and reliability.

  Mr. Robert Banks
  To ask the Secretary of State for Transport when he expects plans to be completed for the improvements to the Al between Wetherby and Dishforth in North Yorkshire; and what is his estimate of the costs involved.

  Mr. Atkins
  Following a public inquiry in 1987, plans for this scheme are being revised to provide a higher standard of road. The fresh proposals will take into account the findings of the current review of the longer-term needs of the A1 between Hook Moor and Scotch Corner, which includes consideration of motorway status. I expect to make an announcement this summer.

  The scheme should be completed in the mid to late 1990s at an estimated cost of £100 million to £110 million depending on the final standard adopted.

  Road Programme
  Mr. Jack
  To ask the Secretary of State for Transport, pursuant to the answer of 14 March, if he will list the length of each road project detailed therein.

  Mr. Atkins
  The information requested is given in the table.
  651

  Length of those county council TSG schemes listed in columns 228 to 234 of The House of Commons Official Report (Vol. 169 No. 73) of 16 March 1990

  Authority and Scheme

  Length(Km)

  Avon

  Newfoundland street Bristol

  0·8

  Avon ring road (1A): Hambrook-Badminton road

  2·3

  Avon ring road (IV): Marsham way—A4 Bath road

  2·8

  Avon R R (IB1): Badminton road—Westerleigh road

  1·0

  Avon R R 1B2: Westerleigh road—Shortwood road

  2·3

  Avon ring road (III): A420 Warmley—Marsham way

  1·9

  M5—Town centre link Weston Super Mare stage 1

  0·3

  Urban traffic control

  0·0

  Weston Super Mare PDR stages VA and VB

  1·4

  Bedfordshire

  Stagsden bypass

  3·0

  Shefford/Clifton/Henlow bypass

  7·0

  Berkshire

  Sandhurst Crowthorne bypass

  3·8

  Slough Bath road Montem lane—Wellington street

  0·6

  Buckinghamshire

  Wing-Milton Keynes Fenny Stratford bypass

  2·2

  Cambridgeshire

  Elton/Chesterton bypass

  5·9

  Cheshire

  Diversion (phase 2) Warrington

  1·2

  Station road bypass Winsford

  1·7

  Chester western bypass phase 1

  2·1

  Haslington bypass

  3·7

  Cleveland

  Durham road bypass

  1·5

  South bank link road

  2·4

  Thornaby bypass

  5·0

  Guisborough road improvement

  10

  Cornwall

  Penzance primary distributor

  4·6

  Truro-Devoran I (Carnon Downs bypass)

  1·4

  Newquay Gannel link road

  0·5

  Sticker bypass

  3·0

  Liskeard industrial distributor road

  1·5

  Cumbria

  Staveley bypass

  2·8

  Papcastle diversion

  2·0

  Romney road link

  0·3

  Derbyshire

  Ilkeston inner relief road

  1·3

  Tapton bypass Chesterfield (stages 1 and 2)

  2·5

  Devon

  Plymouth —St. Budeaux bypass

  1·7

  Milehouse junction improvement Plymouth

  0·4

  Torbay ring road stage 2

  2·7

  Thorns Cross—Eagle Farm stage 1 (Olchard Lane-Eagle Farm)

  1·8

  Thorns Cross to Eagle Farm stage 4

  2·8

  Western Approach/Union street junction improvement Plymouth

  0·8

  Kent

  Faversham western link road

  2·0

  Albion place/Mote road

  1·5

  Thanet way dualling

  28·0

  Ashford southern orbital

  3·6

  Beaver road diversion

  3·9

  Hamstreet bypass

  3·9

  Denton bypass

  7·5

  Whitfield bypass

  2·1

  Sturry road to Military road link Canterbury

  0·2

  652

  Authority and Scheme

  length(Km)

  Dartford northern bypass

  3·0

  Whitfield to Eastry

  7·5

  Lord of the Manor

  0·2

  Eastry bypass

  2·5

  Densole/Hawkinge bypass

  4·0

  South Ashford to Hamstreet

  6·2

  Stockbridge to Brenzett

  4·0

  Maidstone spine road

  2·7

  Somerhill park link Tonbridge

  2·3

  Thames-side industrial route (TIR) stage 1

  2·4

  Lancashire

  Shuttleworth Hall link road

  1·7

  Kirkham and Wesham bypass

  1·9

  Burnley inner relief road (Phase II)

  0·7

  Penwortham bypass extension to Preston

  1·2

  Nelson-Colne (main works)

  1·7

  Chorley town centre bypass (Phase I)

  0·8

  Blackburn inner relief road (Phase I)

  0·9

  North Valley link road Colne

  1·2

  Squires Gate lane Blackpool dualling

  1·4

  Accrington town centre relief road

  0·7

  Freckleton bypass

  3·3

  Park road/St. Helens road link Ormskirk

  0·4

  Lancaster/Morecambe bypass (Phase I)

  5·8

  Dorset

  Gillingham internal relief road

  1·6

  A37 Improvement—Section A

  2·8

  Durham

  Canney Hill bypass

  1·1

  Wheatley Hill bypass

  3·5

  Coundon bypass

  2·6

  Metal bridge to Bowburn

  1·8

  East Sussex

  Boarshead to Eridge

  3·9

  Maresfield bypass

  2·8

  Mayfield bypass

  1·8

  Essex

  Dovercourt bypass stage 2 phase 2

  2·5

  Canes Lane improvement (Final stage)

  1·7

  Maldon bypass

  2·4

  Braintree bypass stage 1

  9·0

  Gloucestershire

  Eastington to Stroud 3 Ebley bypass

  2·0

  Eastington-Stroud-Ebley bypass

  1·3

  Eastington-Slroud 3A-Ebley bypass-Dudbridge

  0·8

  Eastington-Stroud 3B-Ryeford-Dudbridge

  2·Jan

  Hampshire

  Blackwater Valley route

  6·5

  West Totton bypass (2)

  1·2

  Hook bypass underbridge

  0·0

  M3 link Minley

  1·0

  Hereford/ Worcestershire

  Roman road Hereford phase 4 stage 2

  1·5

  A44-A422 Link Worcester road-Whittington road Marl Bank

  1·0

  Hertfordshire

  Stanstead Abbotts bypass.

  4·0

  Waltham Cross relief road phase II

  0·8

  Tonwell bypass

  1·5

  Watford MI link and southern junction system

  3·4

  Stanstead Abbotts to Harlow

  3·8

  Humberside

  Hull north orbital road

  1·2

  Hull Drypool link

  0·6

  Hull Wilmington link

  1·1

  Long Riston bypass

  1·0

  Grimsby New Baxtergate

  0·8

  653

  Authority and Scheme

  Length

  (km)

  Castle Hill to Bentley

  4·6

  Hull Stoneferry bridge

  0·3

  Humber bridge northern approach road

  5·3

  Hedon bypass

  2·4

  Hull Ennerdale link

  3·3

  Leicestershire

  Asfordby bypass

  2·0

  Syston northern bypass

  2·3

  Ashby, Loughborough Coleorton improvement

  1·9

  Redland quarry to Quorn/Mountsorrel bypass link

  1·1

  Lincolnshire

  Wainfleet bypass

  2·0

  Donington bypass

  2·0

  Norfolk

  Dersingham/Snettisham bypass

  5·8

  Trowse bypass

  1·4

  Kirby Cane/Geldeston bypass

  3·2

  Outwell Bends

  2·1

  Watton inner relief road

  0·5

  Northamptonshire

  Oundle bypass

  4·8

  Brigstock bypass

  3·9

  Wollaston bypass

  1·6

  Yardley Gobion bypass

  2·5

  Raunds and Stanwick bypass

  5·0

  Ringstead and Denford bypass (including Ml/Al junction)

  5·2

  Thrapston eastern bypass

  1·6

  Bozeat bypass

  3·3

  Middleton Cheney bypass and Overthorpe hall

  3·2

  improvement

  Brixworth bypass

  2·7

  River Tove Bends

  1·1

  Staverton bypass

  1·2

  Nene valley way I Crawler lane

  1·2

  Northumberland

  Prudhoe northern bypass

  4·4

  Swinburne quarry to Fourlaws stage 1

  2·0

  North Yorkshire

  York outer ring road

  16·0

  A658/A59 Harrogate Knaresborough southern

  10·2

  bypass

  Green Hammerton bypass

  3·0

  Far Laithe to Pacegate

  1·2

  Sherburn-in-Elmet and south Milford bypass

  6·8

  Nottinghamshire

  Hucknall Bypass

  5·4

  Manvers Street Link Nottingham

  1·8

  Oxfordshire

  Banbury Inner Relief Road

  2·0

  Shropshire

  English Bridge Gyratory

  0·4

  Reabrook to Telford Way Link

  2·1

  Whitchurch Bypass

  2·1

  Ironbridge Bypass Extension

  2·8

  Somerset

  Ashill to Southfields Roundabout (A3O3)

  4·8

  Staffordshire

  Tutbury Bypass

  1·6

  Himley Bypass

  1·0

  Uttoxeter to Combridge

  3·4

  Burton Southern Primary Route

  2·8

  Keele Bypass

  1·8

  Cannock Eastern Primary Route

  2·0

  Hawkins Lane Link Burton-Upon-Trent

  0·5

  654

  Authority and Scheme

  Length

  (km)

  Suffolk

  Stowmarket Relief Road

  1·6

  Long Melford Bypass

  5·4

  Kessingland Bypass

  2·5

  Mutford Bridge

  0·5

  Surrey

  Ewell Bypass

  1·6

  Warwickshire

  Stratford Southern Relief Road

  1·4

  Bedworth Bypass Extension (Hen Lane-M6)

  1·3

  Wellesbourne Bypass

  2·1

  West Sussex

  Cuckfield Bypass

  1·8

  Bewbush

  1·1

  Rustington Bypass

  3·0

  Littlehampton Bypass (Main Scheme)

  1·8

  Crawley South Western Bypass

  2·3

  Wiltshire

  Chippenham Relief Road Stage 1

  1·3

  Burbage Bypass

  2·6

  Airport Noise
  Mr. Adley
  To ask the Secretary of State for Transport on how many occasions for each of the last 10 years his Department has utilised its powers to satisfy requirements for limiting the effects of noise at airports in Britain, other than Heathrow, Gatwick and Stansted.

  Mr. McLoughlin
  The Department's long-standing policy has been that owners and operators of airports should be responsible for taking noise abatement measures. The Department has designated 47 airports (including the three London ones) under section 35 of the Civil Aviation Act 1982, which requires consultation between the airport, its users and local interests on matters including noise abatement.

  In addition the Department has taken a leading role internationally in securing agreement to measures reducing noise at source made by aircraft. The resultant standards are given force by orders made under the 1982 Act.

  London Underground (Safety)
  Mr. Cohen
  To ask the Secretary of State for Transport if he will make a statement on the near collision on the London Underground in a tunnel outside King's Cross in the week beginning 11 March.

  Mr. Portillo
  On 12 March, an Underground train travelling southwards on the Piccadilly line stopped at King's Cross station. The train could not continue southwards because the fire brigade had been called to an incident at Covent Garden station. It was necessary, therefore, for the passengers to disembark at King's Cross and for the train to be diverted northwards. To achieve this, the train should have gone south out of King's Cross until it had passed a crossover, and it should then have reversed. In the event, the train immediately reversed. The next southbound train was standing at signals outside King's Cross. The driver saw the headlights of the first train approaching him. In accordance with the procedure in which all drivers are trained, the driver of the stationary train switched off the traction current by shorting the
  655
  wires, mounted on the tunnel wall, which provide a safety measure for use in contingencies such as this one. The driver of the moving train applied his brakes and came to a halt about a train's length from the other train. London Underground has carried out an investigation of this incident and will be sending a full report to the railway inspectorate.

  Mr. Harry Greenway
  To ask the Secretary of State for Transport if he will institute a further inquiry into all aspects of safety on London Underground; and if he will make a statement.

  Mr. Portillo
  A further survey of London Underground's safety management will be made by the railway inspectorate later this year, as announced by my right hon. Friend the then Secretary of State for Transport in his statement to the House on 24 May last (Official Report, Vol 153 columns 502–3).

  Mr. Spearing
  To ask the Secretary of State for Transport what representations he has received concerning the claimed hazards in one-person operation of the older deep level tube railways in London(a) prior to and (b) since Monday 5 March; and on what date he expects to announce any action he intends to take consequent thereto.

  Mr. Portillo
  I am able to trace only representations from the hon. Member for Newham, South (Mr. Spearing) about the one-person operation of older deep level tubes in the 12 months preceding 5 March 1990. Since then, I have received none specifically about this matter, though there has been an inquiry from the hon. Member for Lewisham, Deptford (Ms. Ruddock) about an incident which occurred on the Piccadilly Line at King's Cross on 12 March.

  As to the last part of the question, I have written to the hon. Member about the exercise arranged at the railway inspectorate's initiative and a copy of my letter is reproduced in the Official Report:

  21 March 1990

  Dear Nigel

  It is a coincidence that you put down your Question, about one-person-operation (OPO) of deep level tubes at a time when I was about to respond to your past correspondence on London Underground's emergency procedures in the event of an OPO train driver becoming and the train disabled.

  When I wrote to you in September, I mentioned that the Railway Inspectorate would be making further inquiries about certain aspects of these procedures. You were particularly concerned about the practice of "leapfrogging". The Inspectorate arranged for an exercise to be carried out in the early morning of Sunday 28th January on the Bakerloo Line between Oxford Circus and Piccadilly Circus. It involved four trains, none of which was in passenger service. The simulated emergency was deemed to have been caused by the incapacitation of the driver of the leading train. The simulation was done in such a way as to create the conditions likely to be met if the incident had occurred during the peak hour service.

  Since you are already familiar with the procedures involved, I need not go into detail about the particular actions which took place. It is sufficient to say that the Chief Inspecting Officer tells me that he regards the arrangements as acceptably safe and that they constitute a suitable method to deal with the unlikely event of a train stopping within a single-bore tunnel due to the sudden disablement of its driver.

  Yours sincerely,

  Michael Portillo

  Buses
  Mr. Fearn
  To ask the Secretary of State for Transport what controls exist over the(a) production and (b) use of open-platform public buses; and if he will make a statement.

  Mr. Atkins
  [holding answer 20 March 1990]: Open-platform buses may not be used on local services without a conductor. Apart from this, open-platform public service vehicles are subject to the regulations and certification procedures that apply to all large PSVs.

AGRICULTURE, FISHERIES AND FOOD

  Sea Defences
  Mr. Ian Bruce
  To ask the Minister of Agriculture, Fisheries and Food how much money Dorset, South has received from his Department in recent years for the purposes of sea defence; and whether that money will increase as a result of the recent damage caused by storms.

  Mr. Curry
  Over the past five years, the Department has made payments totalling £3,230,127 in respect of grant to the authorities in Dorset, South for coastal defences. We have not yet received any representations about storm damage in this area but requests for grant aid for reconstruction of coastal defences will be handled in the normal way.

  Bovine Spongiform Encephalopathy
  Mr. Alan W. Williams
  To ask the Minister of Agriculture, Fisheries and Food where the carcases of bovine spongiform encephalopathy affected slaughtered cattle are disposed of in the Carmarthen area; and by what means.

  Mr. Maclean
  The carcases are incinerated on farm.

ENVIRONMENT

  Environmental Assessment
  Mrs. Mahon
  To ask the Secretary of State for the Environment what is the minimum area of land that he considers to be viable for environmental assessment; and if he will make a statement.

  Mr. Moynihan
  The size of a project and the site it occupies are only two of the factors to be taken into account in judging whether a project requires environmental assessment.

  Local Government Finance
  Mr. Malcolm Bruce
  To ask the Secretary of State for the Environment what representations he has received from pensioners regarding the community charge.

  Mr. David Hunt
  I continue to receive representations on many issues concerning the community charge.

  Sir Peter Emery
  To ask the Secretary of State for the Environment whether he will list the actual grant given by Government to each of the county councils for the year 1989–90 and the proposed grant available to them arising from the standard spending assessment for the year 1990–91.
  657
  Mr.David Hunt
  [holding answer 15 March 1990]: The information is as follows. Revenue support grant will not be paid to county councils in 1990–91.

  Revenue grants1 1989–90 £ million

  Avon

  135·1

  Bedfordshire

  51·0

  Berkshire

  45·6

  Buckinghamshire

  45·5

  Cambridgeshire

  85·2

  Cheshire

  129·8

  Cleveland

  145·2

  Cornwall

  117·1

  Cumbria

  117·0

  Derbyshire

  185·8

  Devon

  211·7

  Dorset

  85·8

  Durham

  163·1

  East Sussex

  75·8

  Essex

  130·4

  Gloucestershire

  90·5

  Hampshire

  202·0

  Hereford and Worcester

  113·5

  Hertfordshire

  40·9

  Humberside

  219·0

  Isle of Wight

  25·8

  Kent

  296·1

  Lancashire

  400·2

  Leicestershire

  180·0

  Lincolnshire

  135·9

  Norfolk

  129·6

  Northamptonshire

  103·1

  Northumberland

  57·6

  North Yorkshire

  142·1

  Nottinghamshire

  199·5

  Oxfordshire

  24·3

  Shropshire

  95·7

  Somerset

  93·5

  Staffordshire

  206·3

  Suffolk

  99·4

  Surrey

  42·2

  Warwickshire

  61·0

  West Sussex

  75·8

  Wiltshire

  103·3

  Sir Peter Emery
  To ask the Secretary of State for the Environment if he will list the spending in 1989–90 and the budgeted spending for 1990–91 of each county council; and if he will list in arithmetical order the percentage increase of spending in 1990–91 over outturn spending figures for 1989–90 and indicating the political control of each council.

  Mr. David Hunt
  [holding answer 19 March 1990]: The available information is as follows. I intend to place a summary of the information on 1990–91 budgets in the Library of the House when information has been received from all authorities.

  Net current expenditure 1989–90 £ million

  Political control

  Avon

  485·5

  No overall control

  Bedfordshire

  271·5

  No overall control

  Berkshire

  339·3

  Conservative

  Buckinghamshire

  314·8

  Conservative

  Cambridgeshire

  310·7

  No overall control

  Cheshire

  489·0

  No overall control

  Cleveland

  344·1

  Labour

  Cornwall

  218·2

  No overall control

  658

  Net current expenditure 1989–90 £ million

  Political control

  Cumbria

  258·7

  No overall control

  Derbyshire

  503·3

  Labour

  Devon

  483·1

  No overall control

  Dorset

  280·2

  Conservative

  Durham

  313·5

  Labour

  East Sussex

  297·7

  Conservative

  Essex

  743·5

  No overall control

  Gloucestershire

  251·5

  No overall control

  Hampshire

  694·4

  No overall control

  Hereford & Worcester

  305·4

  Conservative

  Hertfordshire

  498·8

  No overall control

  Humberside

  478·6

  No overall control

  Isle of Wight

  57·4

  SDLP

  Kent

  689·0

  Conservative

  Lancashire

  738·8

  No overall control

  Leicestershire

  460·4

  No overall control

  Lincolnshire

  276·7

  Conservative

  Norfolk

  335·4

  Conservative

  Northamptonshire

  294·2

  Conservative

  Northumberland

  145·5

  No overall control

  North Yorkshire

  337·1

  Conservative

  Nottinghamshire

  540·3

  Labour

  Oxfordshire

  263·1

  No overall control

  Shropshire

  201·1

  No overall control

  Somerset

  232·3

  No overall control

  Staffordshire

  493·3

  Labour

  Suffolk

  280·0

  Conservative

  Surrey

  438·7

  Conservative

  Warwickshire

  241·8

  No overall control

  West Sussex

  292·9

  Conservative

  Wiltshire

  2720

  No overall control

  Mr. Couchman
  To ask the Secretary of State for the Environment what measures have been taken to provide for different levels of standard community charge to be applied according to the different circumstances of properties or individuals.

  Mr. David Hunt
  The standard community charge applies where domestic property is not used as a sole or main residence. Charging authorities may levy the standard charge by applying one of a choice of five multipliers (either 0, ½, 1, 1½ or 2) to their personal community charge. However, different multipliers may be applied for certain prescribed or specified classes of property.

  We have prescribed that no standard charge will be payable for the classes of property listed in table 1. We have also prescribed that for the classes of property listed in table two below the standard community charge multiplier may not exceed one. These provisions will ensure that in an important number of cases either total or partial relief is guaranteed. In particular, no charge is payable for up to three months on property which is unoccupied and unfurnished (for example because it is for sale): until three months after probate where a property is vacant because of the death of the owner; and for up to 12 months where a property is empty because the occupier has moved elsewhere either to care for another person or to be cared for by another person.

  Charging authorities may also set different standard community charge multipliers for classes of property specified by reference to one or more of the factors listed in table three below. This for instance allows authorities the discretion to extend the periods of total relief applying to any class of property prescribed by the Secretary of State, and the discretion to take account of special

  659
  circumstances, for example where properties give rise to the standard charge because the owner is required to live elsewhere in tied accommodation as a condition of his or her employment. My Department has given advice to local authorities on the scope and exercise of the discretion.

  I understand that many authorities have already made good use of these provisions. However, I am concerned that other authorities have not chosen to make reasonable use of the discretion available to them. We will be monitoring local authority practice closely in the first months of the next financial year and, if necessary, we will have to consider further prescription by the Secretary of State for 1991–92.

  Table 1: Types of property for which the Government have specified a maximum standard charge of 0
  Unoccupied and unfurnished property requiring structural repair work to render it habitable, including unoccupied property with respect to which less than 6 months have elapsed since the day on which the work was completed.
  Newly built unoccupied and unfurnished property or property which is being structurally altered, including property in respect of which less than 6 months have elapsed since the day on which the works were complete.
  Unoccupied and unfurnished property in respect of which less than 3 months have elapsed since the date it was last occupied.
  Property which has been empty for less than 12 months because the owner is living in a hospital or residential care home.
  Property which has become vacant on death and in respect of which either probate or letters of administration has been obtained or less than 3 months have elapsed since grant of probate or letters of administration.
  Property whose occupation is prohibited by law.
  Empty vicarages pending the arrival of the new incumbent.
  Properties which have been empty for less than 12 months because the owner has gone to be cared for in someone's home or the carer has left their own home empty to care for someone else.

  Table 2: Types of property for which the Government have prescribed a maximum multiplier of 1
  Caravans (that is, mobile homes on protected sites).
  Property which may not be occupied throughout the year because of local planning conditions imposed on it.

  Table 3: Factors which charging authorities may take into account in specifying standard community charge classes
  The use to which properties are put or intended to be put.
  Whether properties are occupied.
  The period for which properties have been unoccupied.
  The circumstances, other than financial circumstances, of persons subject to standard charges.
  The capacity in which persons are subject to standard charges.
  Whether properties fall within a class prescribed by the Secretary of State.
  The periods for which unoccupied properties have previously been occupied.
  The periods for which properties would have been unoccupied if all or some periods of occupation were treated as periods during which the properties were unoccupied.
  In the case of properties comprised in a deceased's estate, the period which has elapsed since a grant of probate or of letters of administration was made.

  Local Government Finance
  Mr. Austin Mitchell
  To ask the Secretary of State for the Environment if he will publish a table listing councils in rank order on the basis of the difference between the standard spending assessments and actual planned expenditure, and giving the actual figures for both on a per capita basis and the percentage difference between the two.
  660
  Mr. Chope
  I refer the hon. Member to the reply I gave to my hon. Friend, the Member for Kingswood (Mr. Hayward) on Monday 19 March at column 478.

  Mr. David Porter
  To ask the Secretary of State for the Environment if he will make a statement about the classification of offshore workers' liability for community charge; and whether he has any information about local authorities using his guidance notes for seafarers to determine offshore workers' liability.

  Mr. Chope
  It is initially the responsibility of the community charges registration officer to decide whether a person is solely or mainly resident in his area, and therefore subject to a community charge. In determining this, a registration officer will need to consider factors such as the length of time the person is away from home, where most of his belongings are and, if appropriate, where his spouse lives and where his children attend school. In this respect offshore workers are no different from any other potential chargepayer. My Department's guidelines on the treatment of seafarers were not framed with offshore workers in mind, but there is nothing to stop any authorities applying them to this group if they thought it appropriate.

  Mr. David Porter
  To ask the Secretary of State for the Environment if he will make a statement on his criteria for assessing the spending obligations by statute and regulation of Suffolk county council in 1990–91; and how he expects these to change in 1991–92.

  Mr. Chope
  The standard spending assessment for Suffolk county council for 1990–91 has been calculated using the methodology set out in the Revenue Support Grant Distribution Report (England). We have not yet reached any views on spending for 1991–92.

  Mr. Robert Banks
  To ask the Secretary of State for the Environment what are the amounts from the unified business rate which will accrue to(a) the Harrogate borough council, (b) York city council and(c) Scarborough borough council.

  Mr. Chope
  The amounts of redistributed business rates which will be paid to the three authorities are:

  £

  (a) Harrogate borough council

  31,309,939

  (b) York city council

  23,068,264

  (c) Scarborough borough council

  23,754,778

  This money is paid in support of parish, district and county council services in an area and is £293 per adult.

  Mr. Robert Banks
  To ask the Secretary of State for the Environment what are the amounts paid in the individual community charges to the North Yorkshire county council from:(a) Harrogate borough council, (b) York city council and (c) Scarborough borough council.

  Mr. Chope
  I intend to place a summary of the information returned from local authorities in the Library of the House after information has been received from all authorities.

  Mr. Mills
  To ask the Secretary of State for the Environment what proposals he has to assess the workings of the community charge system.
  661
  Mr. Chope
  My Department has kept the development of the community charge system under close scrutiny through a series of monitoring exercises. These have kept us up to date on the progress made by charging authorities. We will continue to monitor the system as billing and collection of the community charge commences.

  Mr. Summerson
  To ask the Secretary of State for the Environment what would be the percentage increase over 1989–90 in rates equivalent to the community charge in the London borough of Waltham Forest for the financial year 1990–91.

  Mr. Chope
  It is our intention when community charges are finally set to say what the increase would have been in domestic rates had that taken the place of the community charge.

  Mr. Butterfill
  To ask the Secretary of State for the Environment if he will calculate what the equivalent rate poundage for the Bournemouth and Poole borough councils would be under their proposed community charge rates of £320 and £325, respectively, under the old rating system; what proportion of the new charge relates to(a) county and (b) borough expenditure; and, in each case, what proportion of the increase is attributable to (i) reduction in Government grant support and (ii) increased expenditure by the county of borough authorities; and if he will make a statement.

  Mr. Chope
  It is our intention, when community charges are finally set, to say what the increase would have been in domestic rates had that taken the place of the community charge.

  The remainder of the information requested is not available, as the community charge is not split between counties and districts. Local authorities providing services in an area precept or make a demand on the collection fund, administered in non-metropolitan areas by the district council. These precepts and demands, which cover the whole of each authority's requirement for revenue, are met in full from the collection fund. Revenue support grant, business rate income and community charge income raised locally are paid into the fund in order to defray these precepts and demands. With these simple arrangements there is no need to allocate revenue support grant, business rates or community charges between tiers of local government.

  The comparison between the revenue which each authority is raising and the Government's assessment of the cost to it of providing a standard level of service will be clear from the community charge bill. Where there is higher spending than the standard, it will be clear to the chargepayer whether it is county or the district which is responsible for that extra spending.

  Mr. Allen
  To ask the Secretary of State for the Environment if he will make it his policy to collect information on those local authorities which will have to issue two poll tax bills in order to take into account rebates given to those who have applied for rebates after 15 February.

  Mrs. Gillian Shephard
  I have been asked to reply.

  No. The information required about local authorities' administration of community charge benefit was agreed with the local authority associations well in advance so that authorities would have sufficient time to prepare.
  662
  Mr. Lewis
  To ask the Secretary of State for the Environment what will be the rebate of community charge applicable in the case of a wage earner receiving £60 per week with a community charge levied at £344.

  Mrs. Gillian Shephard
  I have been asked to reply.

  The community charge benefit payable on a charge of £344, for a single person earning £60 a week, with capital of less than £3,000, would be £2·53 per week.

  Mr. Nicholas Brown
  To ask the Secretary of State for the Environment if he has any plans to review the method of setting revenue support grant available for local authorities in 1991–92.

  Mr. Meale
  To ask the Secretary of State for the Environment if he has any plans to review the method of setting revenue support grant available for local authorities in 1991–92.

  Mr. Chope
  My officials have recently started discussions on the 1991–92 revenue support grant with officials of the local authority associations. The methodology for standard spending assessments will need to be adjusted to take account of local authority responsibilities for community care from April 1991. My right hon. Friend, the Secretary of State for the Environment, has said that he will consider any fresh evidence on SSAs before coming to his decisions for 1991–92.

  Mr. Amess
  To ask the Secretary of State for the Environment what representations he has received on rate-capping Basildon.

  Mr. Chope
  The Department has received a number of representations calling for Basildon to be charge capped. I am also aware of the petition presented to the House by my hon. Friend on 1 March.

  Mr. Loyden
  To ask the Secretary of State for the Environment what representations he has received from local authorities about the setting of a poll tax rate.

  Mr. Chope
  The Secretary of State has received a number of representations from local authorities about the setting of community charges.

  Mr. Andrew Smith
  To ask the Secretary of State for the Environment if he will make a statement on levels of revenue support grant to Oxfordshire.

  Mr. Chope
  The levels of revenue support grant before the safety net adjustment to be distributed to receiving authorities in Oxfordshire in 1990–91 are as follows:

  £ million

  Cherwell

  11·538

  Oxford

  15·231

  South Oxfordshire

  12·062

  Vale of White Horse

  9·854

  West Oxfordshire

  8·912

  These amounts of grant provide a reasonable level of support to local authorities in the Oxfordshire area.

  Mr. Wallace
  To ask the Secretary of State for the Environment how many representations he has received about the rebate system for the community charge.

  Mr. Chope
  I have received a number of such representations. In general, community charge rebates are more generous than the rate rebates they replace.
  663
  Mr. Kirkwood
  To ask the Secretary of State for the Environment how many people in England are eligible to pay the full community charge.

  Mr. Chope
  This information is not available.

  Mr. Knapman
  To ask the Secretary of State for the Environment what will be the cost of collecting the community charge; and what would be the cost of collecting a tax on capital values adjusted according to income.

  Mr. Chope
  The estimate for the annual cost of collecting the community charge in England is approximately £400 million; it is estimated that collecting the local tax based on incomes might cost up to twice that amount.

  Mr. Tracey
  To ask the Secretary of State for the Environment what amount of total external support from Government, in the form of revenue support grant, business rate income, special grants and safety net will be paid in 1990–91 to (i) Wandsworth, (ii) Lambeth and (iii) Tower Hamlets.

  Mr. Chope
  The amounts of external support, that is the sum of revenue support grant adjusted for the safety net, business rate income and special grant in 1990–91 are as follows.

  External support

  £ million

  £ per adult

  (i) Wandsworth

  213·5

  1,034

  (ii) Lambeth

  234·2

  1,358

  (iii) Tower Hamlets

  194·4

  1,723

  Mr. Henderson
  To ask the Secretary of State for the Environment what are his best estimates of the average poll tax level for England in 1990–91.

  Mr. Matthew Taylor
  To ask the Secretary of State for the Environment what is the average community charge level so far declared in England.

  Mr. Skinner
  To ask the Secretary of State for the Environment what are his best estimates of the average poll tax level for England in 1990–91.

  Mr. Chope
  I refer the hon. Members to the answer my right hon. Friend the Secretary of State gave to the hon. Member for Sunderland, North (Mr. Clay) earlier today.

  Mr. Nellist
  To ask the Secretary of State for the Environment what recent representations he has received against the introduction of the poll tax; and if he will make a statement.

  Mr. Chope
  I continue to receive representations expressing a wide range of views on the community charge.

  Mr. Alex Carlile
  To ask the Secretary of State for the Environment what representations he has received from war service pensioners regarding the community charge.

  Mr. Chope
  We continue to receive representations on all aspects of the community charge. I am not aware of any representations from this group in particular.

  Mr. Stott
  To ask the Secretary of State for the Environment if he intends to use different rules for different types of local authority for the purposes of poll tax capping.
  664
  Mr. Turner
  To ask the Secretary of State for the Environment if he will make a statement on the rules he intends to use for poll tax capping.

  Mr. Cox
  To ask the Secretary of State for the Environment if he intends to use different rules for different types of local authority for the purposes of poll tax capping.

  Ms. Short
  To ask the Secretary of State for the Environment if he will make a statement on the rules he intends to use for poll tax capping.

  Mr. Chope
  I cannot speculate on the details of any charge-capping scheme we might operate for 1990–91.

  Mr. Gow
  To ask the Secretary of State for the Environment if he will make a statement on the way in which the community charge is being implemented in England.

  Mr. Chope
  The information available to the Department suggests that good progress has been made by local authorities in implementing the community charge. Initial registration was successfully completed in December and some authorities have already issued their first bills in advance of 1 April.

  Mr. Carrington
  To ask the Secretary of State for the Environment how many recent representations he has received in favour of introducing a system of capital value rates in place of the community charge.

  Mr. John Greenway
  To ask the Secretary of State for the Environment what recent representations he has received to replace the community charge with a system of raising local government finance based on property values.

  Mr. David Hunt
  I am not aware of any representations in favour of capital value rates or roof tax, something which does not surprise me.

  Mr. Ray Powell
  To ask the Secretary of State for the Environment how many local authorities have been able to levy a poll tax below the Government's estimate for their area.

  Mr. Bidwell
  To ask the Secretary of State for the Environment how many local authorities have been able to levy a poll tax below the Government's estimate for their area.

  Mr. Bill Michie
  To ask the Secretary of State for the Environment how many local authorities have been able to levy a poll tax below the Government's estimate for their area.

  Mr. Sheerman
  To ask the Secretary of State for the Environment how many local authorities have been able to set their spending at or below the Goverment's standard spending assesement for their area; and if he will make a statement.

  Mr. John Evans
  To ask the Secretary of State for the Environment how many local authorities have been able to set their spending at or below the Government's standard spending assessment for their area; and if he will make a statement.

  Mr. Boyes
  To ask the Secretary of State for the Environment how many local authorities have been able to set their spending at or below the Government's standard spending assessment level for their area.
  665
  Mr. Cryer
  To ask the Secretary of State for the Environment what is the total number of councils which have levied a poll tax greater than the Government recommended level; and if he will make a statement.

  Mr. Chope
  I intend to place a summary of the information returned in the Library of the House when information has been received from all authorities.

  Mr. Hardy
  To ask the Secretary of State for the Environment what is his estimate of the proportion of local government spending in 1989–90 and 1990–91 which will be devoted to meeting statutory requirements.

  Mr. Chope
  All local authority spending has to be in pursuance of statutory powers. Some spending is a consequence of duties, while some reflects the exercise of discretionary powers. Even where an authority is discharging a duty, there is often a considerable discretion as to the standard of service provided and the efficiency with which it is carried out. It is, therefore, not possible to estimate what proportion of spending will be devoted to meeting statutory requirements.

  Mr. Roger King
  To ask the Secretary of State for the Environment what would have been the increase in domestic rates in the city of Birmingham for 1990–91 for a single householder presently paying £500 in rates, based upon a 1990–91 community charge figure of £406 per adult.

  Mr. Chope
  It is our intention, when community charges are finally set, to say what the increase would have been in domestic rates had they taken the place of the community charge.

  Mr. Nicholas Winterton
  To ask the Secretary of State for the Environment what is the safety net charge paid by the community charge payers in the borough of Macclesfield; and what is the safety net receipt received by the community charge payers in the London borough of Wandsworth.

  Mr. Chope
  Adjustments to revenue support grant to give effect to the safety net are set out in the Revenue Support Grant Transition Report (England), made on 21 December 1989 and approved by the House on 18 January. The borough of Macclesfield's charge payers collectively contribute £5,951,306 to the safety net. The London borough of Wandsworth's charge payers collectively receive £24,030,650 from the safety net.

  The safety net offsets changes in revenue from the domestic sector which are the result of changes in the system of local government finance from 1 April. The safety net limits increases to £25 an adult in real terms compared with 1989–90 rate bills per adult. This limit on increases for some areas is financed in 1990–91 only by other areas contributing about half of their gains. The contributions are for one year only as the safety net will be financed by extra grant from 1991–92.

  Mr. Jacques Arnold
  To ask the Secretary of State for the Environment how many representations he has received in favour of replacing the community charge with a tax on home improvement.

  Mr. Chope
  I have not yet received any representations in favour of the roof tax.
  666
  Mr. Livsey
  To ask the Secretary of State for the Environment what further consideration he has given to capping local authorities' community charges; and if he will make a statement.

  Mrs. Maureen Hicks
  To ask the Secretary of State for the Environment which local authorities he intends to community charge-cap.

  Mr. Chope
  I have nothing to add to what my hon. Friend the Minister for Local Government and Inner Cities said in response to my hon. Friend the Member for Bedfordshire, South-West (Mr. Madel) earlier.

  Mr. Pike
  To ask the Secretary of State for the Environment what representations he has received from Lancashire county council regarding its standard spending assessment.

  Mr. Chope
  The chief executive of Lancashire county council has written to the Department with details of a number of resolutions passed by the county council's finance sub-committee, one of which requests an increase in Lancashire's standard spending assessment for 1990–91.

  Mr. Batiste
  To ask the Secretary of State for the Environment what is(a) the revenue raised by all local authorities in England under the community charge in the year 1990–91 and (b) the revenue raised in rates in the year 1989–90.

  Mr. David Hunt
  I estimate that local authorities are planning to raise £12·5 billion next year from community charges, and £9·8 billion this year from domestic rates.

  Mr. Alton
  To ask the Secretary of State for the Environment what is the average overall difference between domestic rate bills for 1988–89 and the community charge so far declared for 1990–91 by English local authorities.

  Mr. David Hunt
  The average domestic rate bill for 1988–89 was £468. The average community charge for 1991 is estimated to be £363. These figures are not comparable.

  Mr. Allen
  To ask the Secretary of State for the Environment when he next plans to visit Nottingham to discuss local government finance.

  Mr. David Hunt
  I plan to visit Nottingham next Wednesday.

  Chlorofluorocarbons
  Mr. Andrew Mitchell
  To ask the Secretary of State for the Environment what progress Britain is making towards implementing the Montreal protocol on chlorofluorocarbon reductions.

  Mr. Trippier
  By the end of 1989 the United Kingdom had cut its production and consumption of CFCs by over 50 per cent.—10 years ahead of current protocol requirements and five years ahead of even the strengthened provisions now being negotiated.

  Mr. Martyn Jones
  To ask the Secretary of State for the Environment when he expects to receive the technical report he has commissioned concerning the problem of the existing stock of chlorofluorocarbons.

  Mr. Forth
  I have been asked to reply.
  667
  This report has been commissioned by the Department of Trade and Industry. It seeks to establish the prospects for recovery for recycling or destruction of chlorofluorocarbons and halons, and was received this week.

  The study will include assessments of the current and future likely levels of stocks, use and emissions of those substances and of the prospects for alternative products and processes in the United Kingdom. I expect it to be published later this spring. The study complements a previous one for the Department on the impact of health and safety and environment regulatory controls on chlorinated solvents. This was published on 6 March and copies of it have been placed in the Library of the House.

  Acid Water
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for the Environment when he last met representatives from the acid waters review group; and what was discussed.

  Mr. Heathcoat-Amory
  My right hon. Friend has not met the acid waters review group personally, but officials of the Department are in frequent contact with its members.

  Nature Conservancy Council
  Mrs. Ray Michie
  To ask the Secretary of State for the Environment what recent representations he has received regarding the Government's proposals to reorganise the Nature Conservancy Council.

  Mr. Trippier
  As I told the hon. Lady in my written answer of 24 January, my Department continues to receive representations from interested parties covering a range of views.

  Housing Policy
  Mrs. Gorman
  To ask the Secretary of State for the Environment what recent representations he has received regarding his housing policies.

  Mr. Michael Spicer
  My right hon. Friend receives representations from time to time from hon. Members, interest groups and members of the public.

  Mr. Allen McKay
  To ask the Secretary of State for the Environment what provision is made in the Government's planning for new houses to ensure that established environment policies are maintained.

  Mr. Michael Spicer
  A revised planning policy guidance note on housing was issued in draft last autumn: I will send the hon. Member a copy. This makes clear that while adequate provision must be made for new housing development, it should be done with full regard to the need to protect and improve the environment, in both town and country.

  Mr. Patchett
  To ask the Secretary of State for the Environment what advice is given to planning authorities through the planning for new housing policy to ensure that green field sites are not used first.

  Mr. Moynihan
  Existing guidance and draft guidance contained in the proposed revision of the planning policy guidance note on housing emphasise that development plans, in making provision for new housing, should ensure 668
  that full and effective use is made of land within existing urban areas. This should not however be at the expense of the character of established residential areas; policies in plans must also take account of the need for urban open space for recreation and amenity.

  Housing
  Mr. Hunter
  To ask the Secretary of State for the Environment how many acres currently designated as green field sites or for agricultural use are estimated as being needed for housing in the south and south-west of England over the next 10 years.

  Mr. Irvine
  To ask the Secretary of State for the Environment how many acres currently designated as green field sites or used for agriculture are estimated as needed for housing and industrial development in the south, south-east and south-west of England by the year 2000.

  Mr. Michael Spicer
  We estimate that in the south-east of England, excluding London, the proportion of land in urban use will increase from approximately 12·6 per cent. in 1981 to 13·7 per cent. by 2001. Comparable estimates of the rates of urbanisation in other areas are not available though the absolute figures will be much lower.

  Mr. Steinberg
  To ask the Secretary of State for the Environment what provisions in the new city allocation scheme is made for low-cost houses; and if he will make a statement.

  Mr. Chope
  Capital allocations to local authorities do not distinguish between low-cost housing and other housing capital expenditure: it is for individual local authorities to determine their priorities. The Housing Corporation's programme of investment in low-cost housing for rent and sale is set out in tables 8.4 and 8.5 or the public expenditure White Paper (Cm. 1008).

  Vacant Land
  Mr. Hind
  To ask the Secretary of State for the Environment how much vacant land in public ownership is entered on the Land Register showing the acreage in each of the public sectors, statutory undertakings and nationalised industries.

  Mr. Michael Morris
  To ask the Secretary of State for the Environment how much vacant and derelict land in public ownership is entered on the Land Register showing the acreage currently owned by central Government, local government, and nationalised industries.

  Mr. Moynihan
  The breakdown of unused and underused land on the register at 30 September 1989 is shown in the table:

  '000 acres (rounded to 100 acres)

  Acres

  Central Government

  7·2

  Local authorities

  49·4

  Nationalised industries

  9·4

  Statutory undertakers

  6·9

  Other

  9·4

  Total

  82·4

  669
  Mr. Barron
  To ask the Secretary of State for the Environment if he intends to increase the derelict land grant for the Yorkshire and Humberside region; and if he will make a statement.

  Mr. David Hunt
  The national derelict land grant resources available for 1990–91 amount to £71·512 million. Of this sum, £13–450 million has been allocated to the Yorkshire and Humberside region. This represents an increase of 12 per cent. on the region's allocation for 1989–90.

  Mr. Devlin
  To ask the Secretary of State for the Environment how much derelict land in public ownership is entered on the Land Register for each of the last five years for which records exist.

  Mr. David Hunt
  The acreage of unused and underused land on the register is shown in the following table:

  '000 acres

  1 January 1985

  106·3

  1 January 1986

  104·7

  1 January 1987

  98·9

  1 January 1988

  91·2

  1 January 1989

  84·7

  30 September 19891

  82·4

  1 Responsibility for maintaining full registers passed to individual owners at that date.

  Mr. Thorne
  To ask the Secretary of State for the Environment if he has monitored the vacant, derelict and under-utilised land which was in public ownership and has now been transferred to the private sector as a result of his privatisation programme.

  Mr. David Hunt
  No. The efficient use of their assets is a matter for the companies concerned.

  Sir George Young
  To ask the Secretary of State for the Environment how many acres of vacant, derelict and under-utilised land which was in public ownership has now been transferred to the private sector as a result of his privatisation programme; and how much of it is still vacant and derelict.

  Mr. Shersby
  To ask the Secretary of State for the Environment how much land in public ownership is currently on the Land Register; and how many acres have been removed in the last five years as a result of the privatisation of statutory undertakers.

  Mr. David Hunt
  Some 6,900 acres entered on the Department's register of unused and underused land have been transferred to the private sector. Information about its subsequent history is not kept, since the efficient use of their assets is a matter for the companies concerned.

  Education
  Mr. Patrick Thompson
  To ask the Secretary of State for the Environment what proportion of local government spending in 1989–90 will go towards education.

  Mr. Chope
  A total of 46 per cent. of local authority net current expenditure in England in 1989–90 is budgeted to be spent on education.

  Mr. Insley
  To ask the Secretary of State for the Environment what consideration he has given to the provisions of the Education Reform Act in reaching decisions on local government finance in 1990–91.
  670
  Mr. Eastham
  To ask the Secretary of State for the Environment what consideration he has given to the provisions of the Education Reform Act in drawing up his plans for local government finance for 1990–91.

  Mr. George Howarth
  To ask the Secretary of State for the Environment what consideration he has given to the provisions of the Education Reform Act in drawing up his plans for local government finance for 1990–91; and if he will make a statement.

  Mr. David Hunt
  My right hon. Friend the Secretary of State took all the new burdens falling to local authorities into account when setting the level of total standard spending for 1990–91. I believe that the increase of 11 per cent. to £32·8 billion over the equivalent figure for 1989–90 is reasonable.

  North Sea
  Mr. Alan W. Williams
  To ask the Secretary of State for the Environment whether he will bring forward the dates by which he intends to end the dumping of sewage sludge, fly ash and industrial wastes in the North sea.

  Mr. Trippier
  No. We confirmed our intention to end the dumping of industrial waste by the end of 1992 and to end the dumping of sewage sludge by the end of 1998 at the third North sea conference in the Hague on 7 and 8 March. These wastes are not toxic and no harm has been proven in the marine environment. The setting of termination dates is in line with the precautionary approach adopted at the second North sea conference in 1987.

  Mr. Janman
  To ask the Secretary of State for the Environment if he will make a statement on the condition of the United Kingdom's rivers and their contribution to pollution of the North sea.

  Mr. David Trippier
  The United Kingdom's rivers are amongst the cleanest in Europe. Ninety five per cent. are classified as being of good or fair quality compared with 75 per cent. in the European Community as a whole.

  The combined effect of all United Kingdom rivers flowing into the North sea is to contribute about 20 per cent. of riverborne contaminants. The remaining 80 per cent. comes from continental rivers, with the Rhine and Meuse alone contributing some 40 to 50 per cent.

  The United Kingdom's north sea national action plan, published on 5 March, shows the progress that has already been made in further reducing the inputs of dangerous substances to rivers and coastal waters and hence the open sea. For instance, inputs of two of the most important contaminants, mercury and cadmium, have been reduced by 31 and 22 per cent. respectively since 1985.

  Mr. Squire
  To ask the Secretary of State for the Environment if he will make a statement on the outcome of the recent North sea Environment Ministers' conference.

  Mr. Chris Patten
  I refer my hon. Friend to the answer I gave on 12 March to my hon. Friend the Member for Wyre (Mr. Mans) on the outcome of The Hague conference on 7 and 8 March.

  Mr. Waller
  To ask the Secretary of State for the Environment what response his proposals to protect North sea wildlife received at the recent conference of North sea Environment Ministers.
  671
  Mr. Trippier
  The United Kingdom's initiative in raising wildlife as a topic for consideration by North sea Ministers was well received at last week's conference in the Hague. In addition to the United Kingdom's proposals in the package of measures agreed on research, survey and protection of marine wildlife the final declaration also reflects proposals from the Governments of the Netherlands and Sweden. The agreement on protection of small cetaceans (dolphins and porpoises) will be further developed by the Swedish Government in the context of the Bonn convention on the conservation of migratory species of wild animals.

  Mr. Wray
  To ask the Secretary of State for the Environment what recent studies his Department has carried out regarding waste disposal in the North sea and its impact on marine life.

  Mr. Trippier
  Studies of effects of contaminants on marine species arising from any waste reaching the sea, via rivers, the atmosphere or dumping are a fundamental part of marine environment science programmes of the Department of the Environment, the Ministry of Agriculture, Fisheries and Food, the Department of Agriculture and Fisheries for Scotland and other research agencies in the United Kingdom working on the North sea. An assessment of general effects on marine species, reflecting the results of research by the United Kingdom and other North sea states, is included in the quality status report prepared for the second North sea conference, a copy of which is in the Library.

  Recent or continuing work sponsored by the Department of the Environment has included studies of seals and benthic (sea bed) communities, and the development of internationally standardised techniques for assessing the biological impact of contaminants.

  Mr. Mans
  To ask the Secretary of State for the Environment what proportion of pollution entering the North sea comes from rivers; and what proportion of that pollution comes from British rivers and those on the continent, respectively.

  Mr. Heathcoat-Amory
  Pollution enters the North sea by way of rivers and direct discharges, atmospheric deposition, dumping at sea, and the operational discharges from ships and offshore platforms. Of these, reliable estimates can be made of all except atmospheric deposition, the effects of which are widely diffused over the entire sea area.

  Rivers bringing heavy contaminant loads to relatively small areas of the sea, are the most important source of North sea pollution and our best estimate is that they contribute roughly 40 per cent, of the North sea contaminant load. Of that, 20 per cent. comes from British rivers and 80 per cent. from continental rivers.

  Mr. Norris
  To ask the Secretary of State for the Environment what steps he has taken to protect wildlife in the North sea.

  Mr. Trippier
  The third North sea conference last week in the Hague adopted an agreement to protect dolphins and porpoises and a package of other measures on wildlife, including securing better protection for the major North sea wildlife sites.

  Protection for marine wildlife was a United Kingdom proposal at the conference and we will build on these initiatives at future conferences.

  Tourism
  Mr. Wigley
  To ask the Secretary of State for the Environment what representations he has received on adapting planning guidelines to assist farmers diversifying into the tourist trade in the United Kingdom.

  Mr. Michael Spicer
  Rural diversification is one of the subjects covered in the revised planning policy guidance note on "The Countryside and the Rural Economy", issued in draft on 13 December. Nearly 400 responses have so far been received, some of which make specific reference to tourism. All the comments will be carefully considered.

  Homelessness
  Mr. Tony Banks
  To ask the Secretary of State for the Environment what are the latest figures for homeless households(a) in bed-and-breakfast accommodation and (b) in other temporary accommodation in England and Wales.

  Mr. Michael Spicer
  Latest estimates of households temporarily resident in bed and breakfast and other forms of temporary accommodation in England appear in tables 4(a), (b) and (c) of "Local authorities' action under the homelessness provisions of the 1985 Housing Act: England. Results for the fourth quarter 1989. Supplementary Tables", which is in the Library.

  For information about Wales I refer the hon. Member to my right hon. Friend the Secretary of State for Wales.

  Mr. Roy Hughes
  To ask the Secretary of State for the Environment what further proposals he has to combat homelessness.

  Mr. Michael Spicer
  I refer the hon. Member to the reply I gave earlier today to the hon. Member for Vauxhall (Miss Hoey).

  Mr. Callaghan
  To ask the Secretary of State for the Environment what estimate he has made of the cost of bed-and-breakfast or other emergency accommodation as a result of mortgage repossession.

  Mr. Chope
  Information is not held centrally in the form requested. For the latest estimate of the total cost to local authorities of keeping homeless families in bed and breakfast accommodation I refer the hon. Member to the answer given by my hon. Friend the Minister for Housing and Planning, on 21 February 1990 to the hon. Member for Wigan (Mr. Stott) at column 746.

  Contractorisation
  Mr. Boswell
  To ask the Secretary of State for the Environment when he next intends to meet representatives of local authorities to discuss anti-competitive practices in the awarding of contracts for services.

  Mr. David Hunt
  I have no present plans for a meeting with local authorities on this subject, but I shall shortly be issuing guidance by way of a circular.

  Mr. David Porter
  To ask the Secretary of State for the Environment how many representations he has received about anti-competitive behaviour by councils; and what action he is taking to eliminate such behaviour.

  Mr. David Hunt
  The Department has received just over 200 representations alleging anti-competitive practices by
  673
  local authorities in respect of services put out to tender under the Local Government Act 1988 and about 40 arising from the Local Government, Planning and Land Act 1980.

  Each case is investigated and appraised on its merits. My right hon. Friend has considerable powers of sanction under the legislation and has already issued a direction under the 1980 Act, requiring Wirral borough council to obtain his consent before assigning work to its own DSO when it has not submitted the lowest tender, and on 13 March of this year under the 1988 Act to Hillingdon borough council, prohibiting it from carrying out vehicle maintenance work through its own staff after 1 September of this year.

  Home Improvement Grants
  Mr. Buckley
  To ask the Secretary of State for the Environment if he will make a statement on the amount of grants made by the Government for home improvements over the past 10 years.

  Mr. Chope
  During the financial years 1981–82 to 1988–89, the Government provided £2,898 million in Exchequer subsidy to local authorities in England towards their expenditure on home improvement grants. Information for years prior to 1981–82 is not available.

  Association of District Councils
  Mr. Oppenheim
  To ask the Secretary of State for the Environment when he last met the Association of District Councils; and what matters were discussed.

  Mr. Chope
  My hon. Friend the Secretary of State met the Association of District Councils on 26 February. The Association of County Councils and the Association of Metropolitan Authorities were also present. They discussed environmental matters.

  Town Planning
  Mr. Dykes
  To ask the Secretary of State for the Environment if he will list the principal elements being considered for his Department's draft legislation on planning and development controls in urban areas of relatively high density.

  Mr. Michael Spicer
  In reply to a Question from my hon. Friend on 12 March,Official Report, column 104, I indicated the options that I proposed should be included in a forthcoming consultation paper about the possible extension of planning control to the demolition of dwellinghouses. Some of these options would need legislation. As we have indicated, the Government intend to introduce legislation at an early opportunity on a number of planning topics, which would apply in urban areas and elsewhere.

  Mr. Rees
  To ask the Secretary of State for the Environment what action he is taking to ensure high quality design in new and refurbished buildings so that they improve the appearance of the town or city; and if he will make a statement.

  Mr. Michael Spicer
  I refer the right hon. Gentleman to the reply given by my right hon. Friend the Secretary of State to my hon. Friend the Member for Gloucester (Mr. French) on 6 March 1990,Official Report, columns 557–58.

  Planners
  Mr. Steen
  To ask the Secretary of State for the Environment how many planners are employed by his Department; and at what cost.

  Mr. Michael Spicer
  The Department currently employs 65 staff in professional town planner posts at a total cost of £2,609,000 a year.

  Sports Council
  Mr. John Carlisle
  To ask the Secretary of State for the Environment when he last met the chairman of the Sports Council; and what matters were discussed.

  Mr. Menzies Campbell
  To ask the Secretary of State for the Environment when he next intends to meet the chairman of the Sports Council; and what matters he intends to discuss.

  Mr. Moynihan
  I will be meeting the chairman of the Sports Council later today and we will be discussing a range of current issues relating to sport and recreation.

  Mr. Jim Marshall
  To ask the Secretary of State for the Environment what discussions he has held with the Sports Council and the Central Council for Physical Recreation about the new business rate and its impact upon sport.

  Mr. Chope
  My hon. Friend the Minister for Sport and officials of my Department have had a number of meetings with the Sports Council and the Central Council for Physical Recreation at which the impact of the business rate on non-profit-making sports clubs has been discussed.

  Urban Development
  Miss Emma Nicholson
  To ask the Secretary of State for the Environment what is the average annual loss of agricultural land in the United Kingdom for urban development since 1979.

  Mr. Nicholas Bennett
  To ask the Secretary of State for the Environment what is the average loss of agricultural land in both private and public sectors to housing development and other uses since 1979.

  Mr. Michael Spicer
  Information published by the Department shows that the average area of land in England recorded each year by the Ordance Survey as changing from agricultural to urban use in the period 1985 to 1988 was 5,760 hectares per annum. Further details are given in the Department's statistical bulletins, copies of which are in the Library.

  Figures for earlier years are given in planning policy guidance note 7 "Rural Enterprise and Development", but are not directly comparable with the figures for 1985–88.

  Environmental White Paper
  Mr. Adley
  To ask the Secretary of State for the Environment what issues he intends to cover in his forthcoming environmental White Paper.

  Mr. Trippier
  Our aim is to address a wide range of environmental issues, from global concerns about the atmosphere and climate change to topics that impinge on our local environment.

  Rural Development Areas
  Mr. Barry Field
  To ask the Secretary of State for the Environment how many areas have now been designated rural development areas; and what is the size of the population covered by such areas.

  Mr. Heathcoat-Amory
  The 27 designated rural development areas have a population of approximately 2·5 million.

  Rivers
  Mr. Alison
  To put the Secretary of State for the Environment what proportion of United Kingdom rivers are of good or fair quality; and what are the comparable proportions in the rest of Europe.

  Mr. Heathcoat-Amory
  A review of river classification schemes across the European Community published in 1988 by the water research centre showed that 95 per cent. of river length in the United Kingdom was of good or fair quality compared with 75 per cent. in the European Community as a whole. The review also indicated that no other member state had a higher proportion of good or fair quality rivers than the United Kindom, although our position was equalled by the Netherlands.

  Council Rents
  Ms. Primarolo
  To ask the Secretary of State for the Environment if he has any plans to allocate further subsidy to local authorities to prevent local authorities from increasing rents to meet their housing benefit responsibilities.

  Mr. Chope
  No. No local authority has to increase rents to meet housing benefit responsibilities.

  Mr. Cohen
  To ask the Secretary of State for the Environment if he has developed any proposals to bring local authority rent increases into line with his Department's latest rent guidelines.

  Mr. Michael Spicer
  It is for local authorities to determine the rents they set for council housing. Rent increases can stay within the housing revenue account subsidy guidelines if authorities so wish.

  Private Sector Tenants
  Mr. John Hughes
  To ask the Secretary of State for the Environment if it is his intention to extend the principle of tenants' choice to tenants in the private sector; and if he will make a statement.

  Mr. Chope
  No. Many public sector landlords own a very high proportion of the total rented dwelling stock in their area. That is not true of private landlords.

  River Pollution
  Mr. Hague
  To ask the Secretary of State for the Environment what progress is being made by the National Rivers Authority in controlling river pollution and taking action against polluters.

  Mr. Heathcoat-Amory
  Since it fully assumed its responsibilities on 1 September 1989, the National Rivers Authority has been actively carrying out its functions in 676
  relation to pollution control, and has successfully prosecuted a number of offenders. The authority has also embarked on a number of reviews of policy areas, including the discharge consent system, and it will carry out a national survey of water quality in 1990.

  Areas of Outstanding Natural Beauty
  Mr. Rowe
  To ask the Secretary of State for the Environment if he will make a statement on his future policy for the protection of areas of outstanding natural beauty.

  Mr. Trippier
  The draft policy planning guidance note on the countryside and the rural economy issued for public comment on 13 December 1989 is a clear and authoritive statement of the Government's planning policies for the continued protection of areas of outstanding natural beauty and the wider countryside.

  City Action Teams
  Mr. Sumberg
  To ask the Secretary of State for the Environment how many city action teams and inner city task forces are now operating in the north-west of England.

  Mr. David Hunt
  City action teams have been set up in Liverpool, covering Liverpool and Birkenhead, and Manchester, covering the Manchester and Salford areas. Task forces are operating in Moss Side and Hulme, Manchester, and Granby and Toxteth, Liverpool. My hon. Friend the Minister for Industry announced on 28 February that a new task force will be established in Wirral and that the existing Rochdale task force will close later this year.

  South Downs National Park
  Mr. Rathbone
  To ask the Secretary of State for the Environment what submissions he has received for or against the creation of a South Downs national park.

  Mr. Heathcoat-Amory
  So far this year, my right hon. Friend has received one letter from a member of the public for, and two letters from hon. Members covering correspondence against the creation of a South Downs national park.

  Councillors' Allowances
  Mr. David Evans
  To ask the Secretary of State for the Environment when he expects to be in a position to announce the introduction of a new system of councillors' allowances.

  Mr. Heathcoat-Amory
  I refer my hon. Friend to the answer I gave on 23 February 1990 to the hon. Member for Normanton (Mr. O'Brien) at column 24. I expect to announce details of the new system soon.

  Integrated Pollution Control
  Dr. Goodson-Wickes
  To ask the Secretary of State for the Environment if he will make a statement on the introduction of integrated pollution control in Britain.

  Mr. Trippier
  The Government's proposals for integrated pollution control (IPC) are contained in part I
  677
  of the Environmental Protection Bill. IPC will provide an innovatory framework for controlling emissions to air water and land at one and the same time from the most potentially polluting processes. It marks a major breakthrough in the control of pollution and an environmental first in Europe.

  Depending on the enactment of the Bill, IPC will become operational by the end of the year. All new processes will thenceforth come under IPC. There will be a phased programme for bringing existing processes with the system. Our aim is for this programme to be completed within five years.

  Acid Deposition
  Dr. Thomas
  To ask the Secretary of State for the Environment what steps his Department is taking to reduce acid deposition by the year 2000.

  Mr. Trippier
  I refer the hon. Gentleman to the reply that I gave to the hon. Member for Gordon (Mr. Bruce) on 19 February at column 481.

  Mr. Gould
  To ask the Secretary of State for the Environment (1) if he will list current United Kingdom publicly funded research programmes into the impacts of acid rain deposition on sensitive British ecosystems, stating funding levels and research bodies;

  (2) If he will make a statement on progress on the current publicly funded research concerning the impact of acid deposition on sensitive British ecosystems and its findings;

  (3) what is the current United Kingdom publicly funded research programme on critical loads and acid rain; and what are the findings.

  Mr. Chris Patten
  In the current financial year, United Kingdom publicly funded research on acid deposition and critical loads can be summarised as follows:

  Funding body

  1989–90 £k

  Department of the Environment

  14,90·0

  Meteorological Office

  37·0

  Nature Conservancy Council

  94·0

  Natural Environment Research Council

  160·0

  Agriculture and Food Research Council

  48·0

  Ministry of Agriculture, Fisheries and Food

  186·0

  Total 1989–90

  20,50·0

  The United Kingdom plays a prominent international role in the development of the critical loads approach to pollution control. This very substantial programme of research informs that role, and is also part of our overall policy of basing action on the best scientific information that can be obtained.

  The Department has established several review groups of scientific experts to examine and assess research and to recommend priorities in the field of acid rain deposition and critical loads. The United Kindom terrestrial effects and acid waters review groups, and the review group on acid rain have all produced reports, copies of which have been placed in the Library of the House. The critical loads advisory group and the terrestrial effects sub-group on trees are expected to report by the end of this year.

  Countryside Commission
  Mr. Anthony Coombs
  To ask the Secretary of State for the Environment what has been the increase in funding for the Countryside Commission since 1979.

  Mr. Heathcoat-Amory
  Subject to the approval of Parliament, we propose to increase the Countryside Commission's grant-in-aid to £25·136 million in 1990–91. This represents an increase in real terms of 112 per cent. over the allocation in 1979–80.

  Council Properties, Kirklees
  Mr. Riddick
  To ask the Secretary of State for the Environment how many council houses currently stand empty within Kirklees council's boundaries; and what is the current level of council house rent arrears.

  Mr. Chope
  The latest available information on empty council dwellings was provided by Kirklees metropolitan borough council in its April 1989 housing investment programme return (HIP1), a copy of which is in the Library.

  The arrears of rent reported by Kirklees on its housing subsidy claim form at the end of March 1989 were £1·7 million.

  Environmental Pricing
  Mr. Ian Taylor
  To ask the Secretary of State for the Environment what progress is being made by his Department in examining the feasibility of implementing recommendations contained in the Pearce report on environmental pricing.

  Mr. Trippier
  The current review of environmental policy, which will lead to the publication of a White Paper later this year, is considering these among other proposals.

  Uniform Business Rate
  Mr. Geraint Howells
  To ask the Secretary of State for the Environment what representations he has received regarding the uniform business rate; and if he will make a statement.

  Mr. Chope
  I refer the hon. Member to the answer I gave on 5 February 1990 to the hon. Member for Leicester, East (Mr. Vaz) at column 446.

  Mr. Simon Hughes
  To ask the Secretary of State for the Environment how much the London borough of Wandsworth will gain from the uniform business rate in 1990–91 as against its current revenue from business and commercial rates.

  Mr. Chope
  Under the new system of local government finance, non-domestic rate receipts will be distributed as an equal amount per community charge payer and will go to reducing charges. Because of the associated change to the new revenue support grant system and because of major changes in local authority function in inner London, comparisons of levels of business rate income between 1989–90 and 1990–91, or of grant support, do not imply a corresponding effect on community charges. External financial support to authorities (before the safety net and special grants) is
  679
  distributed between authorities so as to enable a charge of broadly £278 to be set in each area if the authorities provide a standard level of service.

  St. Ives Bay
  Mr. Harris
  To ask the Secretary of State for the Environment what are the implications for South West water services proposed long sea outfall into St. Ives bay of his policy announcement accepting the case that sewage discharged into the sea should first be treated.

  Mr. Heathcoat-Amory
  As the applications by South West Water Services for discharge consents related to the Penzance-St. Ives sewerage scheme are currently before the Secretary of State for determination, I am unable to comment on the proposals.

  Sites of Special Scientific Interest
  Mr. Archer
  To ask the Secretary of State for the Environment how many applications for planning consents in request of sites of special scientific interest have been granted(a) by planning authorities and (b) on appeal by the Secretary of State in the last period of 12 months for which figures are available.

  Mr. Trippier
  Neither the NCC nor the Department keeps a central record of the information requested and it could be provided only at disproportionate cost.

  Mortgage Repossessions
  Mr. Battle
  To ask the Secretary of State for the Environment what are the latest figures for mortgage repossessions in England and Wales(a) by building societies and (b) by banks and other financial institutions.

  Mr. Michael Spicer
  The information available to the Department is for mortgage repossessions by United Kingdom building societies in 1989 (13,780) and by English local authorities in 1989–90 (170).

  Clay Pigeon Shoots
  Mr. Colvin
  To ask the Secretary of State for the Environment when he will publish the final draft of the code of practice on noise from clay pigeon shoots 1989; and if he will make a statement.

  Mr. Moynihan
  My Department is in the process of considering responses from a wide range of interested bodies, to a consultation exercise on the Clay Pigeon Shooting Association's draft code of practice on noise from clay pigeon shooting held last year, with a view to meeting the association again in due course to discuss the comments received. No date for the publication of a code of practice has been finalised.

  Sulphur Dioxide Emissions
  Mr. Gould
  To ask the Secretary of State for the Environment what current proposals there are to achieve compliance with its European Community commitment to reduce sulphur dioxide emissions by 60 per cent. of their 1980 value by 1993.

  Mr. Chris Patten
  I refer the hon. Member to the reply which my hon. Friend the Minister for the Environment and Countryside gave to the hon. Member for Gordon (Mr. Bruce) on 19 February at column 481.
  680
  Mr. Gould
  To ask the Secretary of State for the Environment what is his estimate of the contribution to be made from(a) the import of low-sulphur coal, (b) the import of French-generated electricity and (c) an increase in domestic nuclear electricity generation towards achieving the target reduction in sulphur dioxide from 1980 levels by 1993.

  Mr. Chris Patten
  A formal plan for reducing SO2, and NOx emissions from existing large combustion plants will be issued later this year.

  Greenhouse Effect
  Mr. Gould
  To ask the Secretary of State for the Environment what research has been carried out by the building research establishment into energy use in buildings and the greenhouse effect.

  Mr. Chris Patten
  The building research establishment will shortly be publishing a study, commissioned by my Department, entitled "Energy Use in Buildings and Carbon Dioxide Emissions".

  Climate Change
  Mr. Gould
  To ask the Secretary of State for the Environment what steps have been taken so far to adhere to the Noordwijk conference declaration to stabilise United Kingdom carbon dioxide emissions by the year 2000.

  Mr. Chris Patten
  That declaration required the basis for stabilisation to be considered in the light of the IPCC report and the second world climate conference later this year. In the meantime, the Government has continued to finance the work of the scientific working group of the IPCC; offered to host an international technical workshop to explore the practical issues which would arise in making binding agreements on green house gas emissions; and is considering proposals for action both domestically and through the European Community, as appropriate.

  Waltham Forest (Debt)
  Mr. Summerson
  To ask the Secretary of State for the Environment by how much the debt of the London borough of Waltham Forest has increased since 1986; what is the interest payable on this increase; and how much of the borough's community charge is represented by this interest.

  Mr. Chope
  Figures published by CIPFA show that outstanding debt increased from £200 million in March 1986 to £247 million in March 1989. The March 1989 figure includes debt inherited from the Greater London council.

  No information is available on the interest payable on the increase, or on the effect on the community charge.

  Cycling (Royal Parks)
  Mr. Summerson
  To ask the Secretary of State for the Environment how many cyclists have been arrested in London's royal parks over the last five years for cycling-related offences.

  Mr. Trippier
  There is no power of arrest for cycling offences under the royal parks regulations. During the
  681
  three years 1987–89, four cyclists were arrested for failing to give their name and address, one for being drunk in charge of a cycle and one for assault on the police. Figures for arrests in 1985 and 1986 are not available.

  Liverpool (Funding)
  Mr. Hind
  To ask the Secretary of State for the Environment how much funding has been provided by the Government for derelict land reclamation in Liverpool in each of the last three years.

  Mr. Moynihan
  The information requested is as follows:

  Approvals

  Amount £

  1986–87

  26,015,011

  1987–88

  27,580,399

  1988–89

  25,203,412

  Mr. Hind
  To ask the Secretary of State for the Environment how much funding has been provided by the Government through the Housing Corporation and local authorities to housing associations in Liverpool in each of the last three years.

  Mr. Chope
  Over the three-year period 1986–87 to 1988–89 the value of new housing association schemes approved by the Housing Corporation in Liverpool was as follows:

  £ million

  Grant programme

  Actual

  Actual

  Forecast

  1987–88

  1988–89

  1989–90

  Derelict land grant

  3·010

  1·061

  0·552

  Urban programme1

  n/a

  0·072

  n/a

  Merseyside Development Corporation1

  3·560

  1·650

  3·000

  Urban regeneration grant/city grant1 2

  nil

  0·960

  0·835

  1 Includes expenditure on unused or waste land as well as derelict land.

  2 Information does not relate solely to the costs of reclamation since grant is based on the total project costs including those of reclamation.

  Similar figures for 1989–90 are not yet available.

  Comparable figures for schemes supported by Liverpool city council are not available but during the same period the council reported the following gross capital lending to housing associations:

  Year

  Loans £

  1986–87

  2,461,000

  1987–88

  2,125,000

  1988–89

  811,000

  Tyre Disposals Ltd
  Mr. Flynn
  To ask the Secretary of State for the Environment if he will make it his policy to request the health and safety executive to conduct a safety and environmental audit of the site operated by Tyre Disposals Ltd. on Humberside.
  682
  Mr. Heathcoat-Amory
  No. I understand that the relevant waste disposal authority, Humberside county council, has considered the environmental aspects of this company's operations and is pursuing appropriate courses of action under the Control of Pollution Act. HMIP is aware of the situation and is in touch with the waste disposal authority. I also understand that the HSE has not been involved at this site. From the information available, it is unclear whether the HSE or the local district council will be the relevant enforcing authority for the Health and Safety at Work etc. Act.

  Motor Tyres
  Mr. Flynn
  To ask the Secretary of State for the Environment what proposals he has to encourage the environmentally friendly recycling of redundant motor vehicle tyres.

  Mr. Heathcoat-Amory
  My hon. Friend the Parliamentary Under-Secretary of State for Industry and Consumer Affairs is expecting to receive very shortly a final report by KPMG Peat Marwick identifying ways of reducing the volume of scrapped vehicle tyres and increasing resource recovery. When he receives the report he will set up a working party, in conjunction with my Department, with industry, local authority and voluntary group representation, to draw up an action plan.

  Bathing Beaches (Yorkshire and Humberside)
  Mr. Redmond
  To ask the Secretary of State for the Environment (1) if he will list the designated bathing beaches in Yorkshire and Humberside;

  (2) if he will list the designated bathing beaches in Yorkshire and Humberside that breached the European Community mandatory standards for sewage bacteria on at least one sample for the years (a) 1987, (b) 1988 and (c) 1989;

  (3) if he will' list the designated bathing beaches in Yorkshire and Humberside that have failed the European Community guidelines for sewage bacteria on at least one sample for the years (a) 1987, (b) 1988 and (c) 1989;

  (4) if he will list, by year since 1987. for the designated bathing beaches of Yorkshire and Humberside (a) the dates, (b) the locations and (c) the results of routine sampling carried out; and if he will show in his answer where the results obtained breached (i) European Community guidelines and (ii) European Community mandatory standards.

  Mr. Heathcoat-Amory
  The information required for the identified bathing waters of Yorkshire and Humberside is to be found in the reports of the bathing waters surveys for the appropriate years which have been placed in the Library,Official Report, 5 May 1988, column 571; 21 February 1989, column 572; 25 January 1990, column 785.

  National Rivers Authority
  Mr. Thurnham
  To ask the Secretary of State for the Environment what representations he has received about the effectiveness of the new National Rivers Authority; and if he will make a statement.

  Mr. Heathcoat-Amory
  My right hon. Friend receives many letters raising matters, such as water pollution,
  683
  which are now within the responsibility of the National Rivers Authority. I am delighted that the National Rivers Authority has already been able to demonstrate clearly its commitment to effective regulation of water quality. A number of offenders have been successfully prosecuted, and many more have received formal warnings; the authority has embarked on a number of reviews of key policy areas, and is actively developing its priorities for future action.

  Palace of Westminster
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for the Environment what investigations have been made into the location and potential dangers to hon. Members, staff and visitors of asbestos in the Palace of Westminster.

  Mr. Chope
  The parliamentary works office maintains a register of the locations of all known asbestos in the Palace of Westminster and outbuildings. These are inspected annually to check for signs of deterioration. The register has been built up through routine building maintenance inspections of the entire parliamentary estate and tests carried out when work is done which is likely to uncover previously hidden asbestos. All potentially dangerous asbestos is removed.

  Mr. Colvin
  To ask the Secretary of State for the Environment if he has any proposals to undertake maintenance work to the great clock this year.

  Mr. Chope
  Following one of the regular inspections of the clock it has been decided to replace part of the mechanism which is showing signs of fatigue. This will necessitate stopping the hour strike for up to 12 weeks and all chiming and striking for two days whilst the mechanism is disconnected and when it is reconnected. The work will start on Monday 26 March.

  Dangerous Substances
  Mr. Day
  To ask the Secretary of State for the Environment what steps the Government are taking to control the emissions of dangerous substances into rivers and the sea.

  Mr. Heathcoat-Amory
  Discharges of dangerous substances to rivers and seas are already effectively controlled by the National Rivers Authority through discharge consents based on its duty to maintain statutory quality objectives and other published environmental quality standards.

  The Environmental Protection Bill extends the controls on discharges of dangerous substances from the most polluting industries. Under the new arrangements Her Majesty's inspectorate of pollution will authorise discharges to all environmental media, based on the use of best available technology not entailing excessive costs, providing that these also meet the requirements of the National Rivers Authority on environmental quality objectives.

  Crown Suppliers
  Mr. Dalyell
  To ask the Secretary of State for the Environment what steps have been taken to ensure that no staff or former staff of companies bidding for the Crown Suppliers are engaged as consultants.
  684
  Mr. Chope
  [holding answer 19 March 1990]: When employing consultants, care is always taken to avoid potential conflicts of interest. It would not be acceptable to use, as a consultant on a matter relating to the Crown Suppliers, either a company which was bidding for the Crown Suppliers or an individual who was known to have a continuing relationship with a bidder.

  Household Statistics
  Mr. Gregory
  To ask the Secretary of State for the Environment how many households there were nationally, in the Yorkshire and Humberside region and in the county of North Yorkshire for 1979, 1983, 1987 and the most recent year; and if he will make a statement.

  Mr. Chope
  [holding answer 20 March 1990]: The estimated numbers of households are as follows:

  Thousands

  1979

  1983

  1987

  1988

  England

  17,071

  17,579

  18,363

  18,536

  Yorkshire and Humberside region

  1,808

  1,849

  1,906

  1,924

  North Yorkshire

  249

  258

  273

  278

  Hazardous Waste
  Mr. Bellingham
  To ask the Secretary of State for the Environment what was the volume and sources of hazardous waste imported into the United Kingdom under the terms of the Transfrontier Shipment of Hazardous Waste Regulations 1988 during the last convenient 12-month period.

  Mr. Trippier
  [holding answer 20 March 1990]: Imports of waste into England and Wales during 1989 under the Transfrontier Shipment of Hazardous Waste Regulations 1988 were as follows:

  tonnes

  Austria

  166

  Australia

  280

  Belgium

  9,225

  Brazil

  46

  Canada

  1,011

  Channel Islands

  30

  Denmark

  104

  Finland

  12

  West Germany

  611

  Greece

  5

  Ireland

  1,358

  Italy

  1,505

  Luxembourg

  17

  Netherlands

  14,799

  Norway

  533

  Philippines

  29

  Portugal

  73

  Singapore

  5

  Spain

  64

  Sweden

  1,541

  Switzerland

  5,086

  Uruguay

  3

  United States of America

  4,237

  TOTAL

  40,748

  Genetically Engineered Organisms
  Mr. Malcolm Bruce
  To ask the Secretary of State for the Environment if he will make a statement on the possible ethical implications of regulating genetically engineered organisms.
  686
  Mr. Trippier
  [holding answer 20 March 1990]: I am considering the ethical implications of such regulation with colleagues and will make a statement in due course.

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

Retirement Pensions: Policies
Lord Donoughue Lord Donoughue asked Her Majesty's Government:
Whether, in the light of their policies towards SERPS, they have any new proposals for mitigating poverty arising in old age.
The Parliamentary Under-Secretary of State, Department of Social Security (Lord Henley): My Lords, I do not accept that government policies towards SERPS have the effect which the noble Lord's Question suggests. We have always attached a high priority to protecting the interests of elderly people and will continue to do so. Nevertheless we have recognised that not all pensioners have benefited from the growth in occupational pensions and have targeted an extra £ 200 million towards 2–6 million individuals— the older, disabled and less well-off pensioners on income support and housing benefit. Also, in October last year we abolished the retirement pensions earnings rule so that pensioners can now draw their pension in full while continuing to work if they wish to do so.
Lord Donoughue: My Lords, I thank the Minister for that Answer. Has he read the report by PIRC, the Pensions Investment Research Consultants, published in February? It shows that around 1 million people persuaded to contract out of SERPS were wrongly advised to do so. About one-third of those contracted out are highly likely to be worse off under their personal pensions than they would have been under SERPS on the assumption that the stock markets and investment markets perform as well in the future as they have in the recent past. Is the noble Lord also aware that investment institutions are advertising in an excessive way to persuade people to contract out of SERPS? Will he promise that his department will advertise, advising those for whom it is best to stay in SERPS— that is anyone retiring in the next decade— that they should do so?
Lord Henley: My Lords, we are aware of the report and are examining the claims by the Pensions Investment Research Consultants. However I do not necessarily accept their figures. It is obviously a matter for the individual who wishes to take out a personal pension to seek the appropriate advice. There are regulatory bodies in the form of LAUTRO and FIMBRA who will control and regulate those who offer advice to individuals seeking to take out personal pensions. Our own leaflet, NP41, which I believe I have mentioned on a previous occasion, states that there is no guarantee of investment results from the money paid into any scheme.
Lord Carter: My Lords, is the Minister aware that the next Labour Government will require that money purchase and pension schemes will only be allowed to contract out of SERPS if they can guarantee a comparable minimum pension? Will the Government now introduce a similar requirement?
Lord Henley: My Lords, I believe that the eventuality to which the noble Lord refers is very unlikely, as I told him the other day. He will also know that my right honourable friend the Secretary of State announced further protection for occupational pension schemes only last week.
Lord Orr-Ewing: My Lords, is my noble friend aware that whatever promises are made for the future, during the last five years of the Labour Government pensions of old age pensioners rose in real terms by only 3 per cent.? Under this and previous Conservative Governments, they rose five times faster.
Lord Henley: My Lords, my noble friend is quite correct. Under this Government the average income of pensioners has risen by 31 per cent.
Lord Carter: My Lords, the Minister referred to the recent announcement by the Government. Is he aware that the scheme which did no more than the Government required by way of uprating would cut the real value of pensions dramatically? A pension preserved for 20 years would today be worth less than 40 per cent. of its original value under the Government's new proposals.
Lord Henley: My Lords, that depends very much on inflation.
Lord Stoddart of Swindon: My Lords, in relation to the question from the noble Lord, Lord Orr-Ewing, is it not a fact that if the Government had retained the Labour Party policy of increasing pensions by the rate of inflation or rather the rate of earnings, a married couple would now enjoy a pension £ 20 more than at present?
Lord Henley: My Lords, the link between the basic pension and earnings is not the key factor in improving the income of pensioners. More important to pensioners is the value of their total income from all sources. As my noble friend Lord Orr-Ewing said, between 1974 and 1979 when pensions were increased in line with the higher of movements in prices or earnings, the average total net income of pensioners increased by only 3 per cent. During our first eight years in office the real terms increase was over 31 per cent.
Lord Jenkin of Roding: My Lords, will my noble friend confirm that during the period of the last Labour Government the value of pensioners' savings was just about halved? Does he agree that every possible welcome should be given to the announcements in yesterday's Budget not only of higher disregards for capital savings but also of substantial new incentives for saving? That is the way in which people will improve their standard of living in retirement.
Lord Henley: My Lords, my noble friend is quite correct. Under this Government the savings income has increased by 130 per cent. Under the previous Labour Government it decreased by 16 per cent. My noble friend raised also the question of increases in the capital limits in income related benefits. There will be around 260,000 individual gainers as a result of the increases announced by my right honourable friend the Chancellor of the Exchequer, over 60 per cent. of whom are pensioners.
Lord Carter: My Lords, will the gainers include the pensioners in Scotland?
Lord Henley: My Lords, the pensioners in Scotland will benefit in exactly the same way as the pensioners in England. We are uprating the system for the whole country at the same time.

Unsolicited Advertising by Fax
2.43 p.m.
Lady Saltoun of Abernethy Lady Saltoun of Abernethy asked Her Majesty's Government:
Whether they have any plans to introduce legislation to prohibit the sending of unsolicited advertising and circulars by facsimile (fax) machines.
The Minister of State, Department of Trade and Industry (Lord Trefgarne): My Lords, any advertiser of this kind is required to cease sending his messages when so requested by recipients. However, the Director General of Telecommunications is currently considering whether any further steps are necessary to contain this nuisance.
Lady Saltoun of Abernethy: My Lords, will the Government consider how legislation which has been enacted in certain parts of the United States of America, such as Connecticut, Oregon and Maryland, works, with a view possibly to introducing legislation of their own? Will they also consider introducing legislation to make it an offence to send unsolicited advertising material to anybody on OFTEL's list of fax owners who does not wish to receive it? Will the Government ask OFTEL to get the list out as quickly as possible?
Lord Trefgarne: My Lords, I cannot promise that we shall introduce legislation for this purpose. However, I hope that adequate protection can be provided by a code of practice which the director general is currently discussing with the professional and trade organisations concerned.
Lord Williams of Elvel: My Lords, how does the recipient complain, and by what mechanism, about unsolicited junk coming through his fax machine? If, for example, I received an unsolicited copy of the Chancellor's Budget Statement, which is obvious junk, who do I complain to?
Lord Trefgarne: My Lords, the noble Lord would have to complain to the person who sent it.

Charitable Giving: Statistics
2.45 p.m.
Lord Gainford Lord Gainford asked Her Majesty's Government:
How the level of charitable giving has changed since 1979.
Viscount Ullswater: My Lords, figures published by the Charities Aid Foundation show that charitable giving has increased steadily. Between 1979 and 1987 the voluntary income of the top 200 charities has almost doubled in real terms, having risen from about £ 228 million to over £ 900 million.
Lord Gainford: My Lords, I thank my noble friend for those encouraging figures. Does the figure of £ 900 million represent the total amount of charitable giving?
Viscount Ullswater: No, my Lords. It represents the voluntary income of the top 200 charities. The total is estimated to be very much higher. The Charity Household Survey of 1988 to 1989 suggests that donations to charity amount to between £ 3 and £ 4–5 billion. Yesterday's Budget has given considerable encouragement to charitable giving.
Lord Mishcon: My Lords, has it escaped the attention of the noble Viscount that since 1979 there has been a greater need for charity among people who before that date did not need it?
Viscount Ullswater: My Lords, I think the noble Lord refers to statutory provision. It is the view of this Government that the voluntary charitable sector complements what the statutory sector does but does not replace it. We see the voluntary, statutory and indeed private sectors as partners.
Viscount Whitelaw: My Lords, is my noble friend aware that, as Chairman of the Council for Charity Support, I can tell him, the Chancellor of the Exchequer and Members of all parties that all charities will greatly welcome the measures that the Chancellor announced in his Budget yesterday?
Viscount Ullswater: My Lords, I know that the noble Viscount speaks from considerable experience. I welcome the comments that he has made.

Student Loans
2.47 p.m.
Lord Molloy Lord Molloy asked Her Majesty's Government:
Whether the breadth and strength of the opposition to their proposals for student loans has caused them to make any alternative proposals.
Baroness Blatch: My Lords, the Government have considered alternative proposals but have concluded that the top-up loans scheme is the best way to provide more resources to students, while sharing at the same time the cost of student support more fairly between taxpayers, students and their parents.
Lord MolloyMy Lords, I am almost tempted to congratulate the noble Baroness on that reply. It appears that the Government intend to consider no alternative to what is regarded in academic circles as the most vicious and unjust scheme ever produced in academic history. That view is shared by many Members on both sides of this House. However, I am not so much interested in the future of the Tory Party as in the future of education in this country. Is the noble Baroness aware that this measure constitutes a grave threat to higher education and to staff and students, and that the scheme will not in any way save any money but will only cause grave embarrassment to students, their parents and the staff of our universities?
Baroness Blatch: My Lords, the noble Lord will not be surprised to hear me say that I do not agree with anything that he has just said. I believe those parents who now find support for students a great burden will welcome the changes that will be brought about by the Education (Student Loans) Bill, as will some of those students who do not enjoy the full support of their parents who have an obligation to support them. It is a great pity that the noble Lord has not been able to take part and to put his point of view in the debates on the Bill so far.
Lord Rippon of Hexham: My Lords, I support the generality of the Government's proposal. However, will the Government give consideration to the idea that was put forward in The Times the other day by Sir Philip Goodhart whereby there could be some revival of the former scheme enabling graduates who become teachers, doctors or nurses to have some clawback, as it were, of the loan over a period of years?
Baroness Blatch: My Lords, I understand that the point that my noble friend made is the subject of an amendment to the Bill. All such detailed points are being considered as the Bill proceeds through this House.
Lord Boyd-Carpenter: My Lords, in view of the fact that your Lordships' House is quite rightly devoting a great dual of time to discussion of the Bill, is it necessary to have an additional debate at Question Time?
Baroness Blatch: My Lords, I believe that the Question is superfluous at this time. So far we have spent three days on the Bill. We shall spend most of next Monday on the Bill and then there will be Third Reading. There has been every opportunity for the noble Lord to put forward his points in that debate.
Lord Molloy: My Lords, is the noble Baroness aware that I was in this Chamber and listened to the notable speeches of the noble Lords, Lord Beloff and Lord Boyd-Carpenter? Those speeches were approved of by university staff and students. Can the noble Baroness say what is the Government's estimate of the cost of all of this, which is going to disrupt higher education?
Baroness Blatch: My Lords, I do not believe that it will disrupt higher education. If the noble Lord is interested in the detail of the matter I suggest that he sits through the debates. He may learn the answer to his question.
Lord Molloy: My Lords,—
Noble Lords: Order!
Lord Molloy: My Lords, my last question was fundamental. Will the noble Baroness tell the House and the country the cost of the scheme?

Eastern Europe and the Soviet Union
2.51 p.m.
Lord Home of the Hirsel Lord Home of the Hirsel rose to call attention to the political and economic developments in Eastern Europe and the Soviet Union; and to move for Papers.
The noble Lord said: My Lords, all of your Lordships will be very conscious that for the first time for many years in a foreign affairs debate we shall not have the benefit of the advice of Lord Stewart of Fulham. This will be the first of a series of debates on international affairs, and as we try to disentangle the problems of Eastern Europe and the Continent of Europe we shall miss the penetrating clarity of his mind.
I am very grateful that the noble Lord the Leader of the Opposition is to follow me in the debate. I have to confess to him and to your Lordships that I am tempted to revert to my original status in this House and ask the indulgence of your Lordships for this speech. I am very conscious that it is quite likely that a speech made today on Eastern Europe and the Soviet Union will have to be contradicted tomorrow, so rapid is the pace of events.
The other day I asked one of my most experienced diplomatic friends how he had reacted to Mr. Gorbachev's Russia. He said, "I can only see through a glass darkly". I believe that that was true of most of us at that time. Much is still obscured.
This morning one of your Lordships kindly sent me an extract from a writing of Francis Bacon which I believe noble Lords would like me to read. It is as follows:
"Upon the breaking and shivering of a great State you may be sure to have wars: for great Empires, while they stand, do enervate and destroy the forces of the natives they subdued, resting on their own protecting forces. And then, when they fail also, all goes to ruin and they become a prey".
My conclusion today will be less sombre; but that is a timely warning, particularly when it comes to the designing of a pan-European security system to replace the existing alliances. When that time comes, I shall plead for time— for an interregnum, for two or three years to be taken up by negotiation— so that we can be sure that we plan for a lasting peace and give ourselves enough time to get the right solution.
Today we know more than we did a few weeks ago about the motives for Mr. Gorbachev's reforms. They were primarily economic. After 70 years of fair

315
and public trial, the people of the Soviet Union, on the evidence before their eyes, could not help concluding that Marxism had totally failed to deliver the goods. Marxism had promised a great deal: full employment, equal opportunity and social justice. None of those promises has been fulfilled. It was a body blow to the people of the Soviet Union. Marx and Lenin were the founders of communism and the two greatest heroes of the Soviet Union. Their doctrine has been discredited. A whole country and empire was left without an ideology and without a faith, a very dangerous and critical situation. Mr. Gorbachev inherited that situation.
Mr. Gorbachev described that situation as "desperate" and requiring fundamental change. Indeed, he brought in those fundamental changes even though economically that involved borrowing the capitalists' clothes and politically, following the fiasco of the invasion of Afghanistan, it meant abandoning the central communist doctrine that force could legitimately be used to secure a political aim.
At the start some doubted whether Mr. Gorbachev's counter revolution was genuine. Now it is clear that the reforms have gone so deep that neither the Soviet Union nor the communist ambition for empire can ever be quite the same again. The hardest evidence of that is to be found in Eastern Europe. It is there, I believe, that the Western democratic capitalist countries have an opportunity to contribute to the economic and political stability of that area.
At least four of the countries of Eastern Europe— East Germany, Poland, Hungary and Czechoslovakia— have taken the decision that they will be independent, economically and politically, and will never again accept dictation from Moscow. To that extent the map of Europe has already been changed to a point which no one could have foreseen even two years ago. Those countries may be described as determined to construct constitutions and institutions in the democratic mode. The only doubt at the present time is whether they will be too poor to sustain the democratic system and in their turn deliver the goods to their own people.
There are certain encouraging signs. The reuniting of the two Germanys will surely create a viable economic unit. Poland, where religion has undoubtedly been a cementing factor, will certainly receive, both from the United States and from the countries of the European Economic Community, enough help to set it firmly on the road to recovery. Czechoslovakia and Hungary present a more difficult problem. However, I believe that they too can look with some certainty to investment from the democratic and capitalist world. They will need some assistance, because it is here that the Western democracies can clearly take the decision now to help them to underpin their new political independence.
I do not think that at present that need mean membership of the European Economic Community. It might well be a mistake to try to run before we can walk: nevertheless, if the Eastern European countries can design a free market among
316
themselves, if that can be strengthened by an institutional link with the existing Common Market in Western Europe and the plans for recovery for Eastern Europe can be co-ordinated and underwritten by the World Bank, those countries can, in Mr. Gorbachev's rather dramatic words, recover their European home. I hope that that is something for which all European countries can work.
I should like to turn to another area which I think is ripe for exploitation in the interests both of the Soviet Union and of the Western democracies. If the diagnosis is right— that Russia's troubles basically stem from the weakness in its economy— surely the Russian leaders must pay serious attention to the colossal savings in cash which could be achieved by a considered programme of demilitarisation. The formula to gain those prizes without impairing Russia's security is ready to hand; it is of course mutual and balanced disarmament.
I remember, when I presided over a disarmament conference in Geneva, Mr. Gromyko refusing to sit down at the table so long as that formula headed the agenda. But now things should be different. There is a mutual interest. Russia must want to strengthen its economy and the European members of the Community must want to see lifted the menacing cloud which has brought fear to the whole of Europe for the last 40 years. I believe that that can be done. The purpose of such an exercise is to fix the level of forces and weaponry low enough to ensure that aggression is no longer seen to be an option for either side. If we could reduce armaments to that level, that would be a good start and would also be the objective of the disarmament conference which will take place this summer.
As I said at the start, if such a preliminary negotiation can succeed this year and a mutual balance can be struck, that would be the best foundation of all from which to begin the lengthy negotiations for a pan-European security system designed to replace the existing alliances. I confess that I am more optimistic than I have been for many years that such arrangements can be reached successfully in the foreseeable future.
What kind of Russia shall we have to deal with? That is of course for the Russians to decide. However, because the danger of fragmentation of the Soviet Union is one to which we may have to face up, I have been hoping that Mr. Gorbachev would move towards a confederal system or a Commonwealth structure or whatever one likes to call it. That will be vital because, when we come to the negotiation of those matters which are so serious for the future of Europe and of the world, it will be important that we find a country expressing its wishes with one voice. I am a lifelong opponent of the old dictatorial Russia, but I am not attracted to the idea of a Russia which is fragmented into small republics which cannot speak with one voice. It is essential that the Russia with which we have to negotiate should be able to do that.
Reverting for a moment to the disarmament scene, I do not see how Mr. Gorbachev could object to negotiations under the heading of "mutual and balanced disarmament" because the purpose in view

317
would as I have described, be to eliminate the option of aggression from either side. So the pan-European security system is one of the main objectives which we should try to reach.
I do not think that I have any more suggestions to make today. I repeat my belief that it is now realistic to assume that the four countries of Eastern Europe which I mentioned can be independent in their own right, both economically and politically, with a little help from the West. I hope that, when we come to negotiations, the British Parliament will play a constructive part. I look forward to the debate because many noble Lords will have constructive ideas. In the meantime, I beg to move for Papers.
3.7 p.m.
Lord Cledwyn of Penrhos: My Lords, we are all grateful to the noble Lord, Lord Home of the Hirsel, for tabling this most important Motion and for his balanced and thought-provoking speech. The noble Lord has concentrated on the central implications of the momentous events in Eastern Europe and I shall seek to follow him.
My colleagues and I also appreciate the noble Lord's warm tribute to our late friend, Michael Stewart. We shall miss him very much in our debates, especially in our discussions on foreign affairs. His wisdom and experience gave his speeches a special quality and I know that they were valued by noble Lords in all parts of the House.
Noble Lords: Hear, hear!
Lord Cledwyn of Penrhos: My Lords, as the noble Lord, Lord Home, has said, the speed of recent events, the historical background of the various countries concerned, the quality of their present leadership and the state of their economies make firm predictions impossible. Who can say what things will be like in Romania or Bulgaria or indeed, as the noble Lord said, in the Soviet Union in 12 months' time? It is one of those moments in history when great opportunities are matched by grave dangers.
The theme of the noble Lord's speech is that Britain and the West must observe and react to those events wisely and generously so that free and stable societies might be created in Eastern Europe. That is the aim of the people of those countries and of every country in the West, but it is a daunting task. We all think in terms of an undivided Europe of free countries, but, if we do not get it right, rejoicing could quickly turn into tears.
The eyes of the world were on East Germany last Sunday— I shall return to that matter later— but we wish the new government every success in their historic task. We also look forward to free elections over the next five months in Hungary, Romania, Bulgaria and Czechoslovakia. Elections in Poland have already been held, as we know. We thank heaven that there will be democratically elected governments in Eastern Europe. Had someone suggested it in a debate in this House 12 months ago, we would have turned away our heads in disbelief. But the reality is that in due course people
318
will want to see results. Many will judge the success of the democratic process by the amount of food in the shops. They will want efficient public services, good hospitals, decent jobs and all the things that the West tends to take for granted.
The task of economic reconstruction is crucial and immense. But peace in Europe depends upon its success. We in this country, together with other countries, must spare no effort in working for it. By "working for it" I mean co-operating in constructive Community policies which will help to strengthen their economies. I shall return to that point. It must also be emphasised that the final solutions and therefore their success or failure must come from within the countries themselves. The new governments there will have to formulate and operate their own policies. That is already happening in Poland where a government composed mainly of non-Communists are carrying out measures which are not popular because of their austerity but which are essential nonetheless. The medicine is unpleasant, but the Polish people are taking it at the present time and we must admire them for doing so.
The other challenge facing Poland, Hungary and the other countries is to build or re-build the foundations of democractic societies; namely, an independent judiciary, an impartial Civil Service and the establishment of the rule of law with all that it implies. From what I have heard and read over the past few months I understand that the broad objectives of the leaderships of the six countries concerned are: a democratically elected government with practical policies which they are resolved to pursue; the creation of basic democratic structures; and finally, the resolve to become members of an undivided Europe in which military confrontation and the arms race are things of the past, as the noble Lord, Lord Home, mentioned.
Those are ideals that we can all share, but what can we do to help? The noble Lord, Lord Home, made some important suggestions. I hope that the noble Lords, Lord Brabazon and Lord Belstead, will respond constructively to his points. I trust that Ministers will say that the West must provide leadership, inspiration and generous assistance. Both the noble Lord and my noble friend Lord Callaghan suggested that action on the lines of the Marshall Plan should be considered. There is little doubt that financial aid, if it is to be effective, must relate to the vast size of the problem. It must include grants or loans for the purpose of building up foreign exchange reserves. It is said that while IMF loans help, they are too small. But it is good to know that Poland has already received 1 billion dollars for that purpose. Again, support will be needed to cancel most of the debt already owed to western governments and banks. They would be crippling and could also frustrate the reforms.
Finally, there is the urgent need for long-term finance for development— the Marshall Plan type aid mentioned by noble Lords. Decisions on these matters must be taken not by bankers, financiers or businessmen— they come in later— but by politicians with guts and vision. That is what is needed at the present time. We shall be glad to have the Minister's comments on these proposals and

319
on the scope and nature of the assistance that the Government believe is necessary to buttress the foundations of these new democracies.
Furthermore, will the noble Lord confirm the assumption that the aid programme will be planned, organised by and channelled through the European Community? As I see it there is no practical alternative. The imminence of the single market underlines that point. May we also assume that any Community initiative will be taken in concert with the United States and other countries such as Canada, Australia and Japan? Can he say whether talks about that are now taking place in the European Community and with the United States? It is a matter of the utmost importance.
I noted that the other day the Governor of the Bank of England urged that:
"assistance needs to be coordinated … assistance offered by individual institutions fits into the overall pattern of the requirements of recipient countries".
Taking all that into account, it would be a mistake to think that the mismanagement of decades can be put right in a few months. The process of rebuilding the economies of many of these countries will take many years of hard work and the implementation of realistic policies. Every country which is undergoing change has its own special problems and the implications are best known to the people themselves. For example, the economic and social problems of Romania are far greater than those of Czechoslovakia— the reasons for which noble Lords are aware. East Germany poses complex problems. I recall the debate opened by my noble friend Lord Callaghan on 17th January on the topic of German reunification. There have been changes in the short space of time since then. The most important is the broad acceptance throughout Europe— and also in the Soviet Union— that the reunification of Germany is now inevitable if the German people, West and East, desire it, which they obviously do.
We also warmly welcome last Sunday's free elections in East Germany. I repeat that we wish the new government success. They are fortunate to have at hand the goodwill and enormous resources of West Germany. But people are asking some very basic questions and I think that they should be ventilated in this debate. For example, what kind of Germany will emerge? Will East Germany be joined with the West as one seamless country or will there be a federal arrangement? Will West Germany remain in the European Community and will East Germany join it there? And there is the most difficult question of all: will West Germany remain in NATO and what happens to East Germany then, especially in view of the Soviet reaction to that possibility?
The new government must now decide how they propose to approach the problems inherent in unification. As we know, the different parties there have different views. For example, the Christian Democratic Alliance, which is now forming a government, advocates a speedy merger with West Germany. The way ahead for Germany is fraught with complexities for them and indirectly for the rest of us. I note that the right honourable gentleman the Foreign and Commonwealth Secretary has held
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detailed talks with Chancellor Kohl and with Mr. Hans Dietrich Genscher. He is reported as being encouraged by those discussions. He also said that the future of NATO must be clarified before unification takes place, although he also gave the impression that he wanted to see the swift entry of East Germany into the European Community. Lastly, Mr. Hurd said that he would prefer to see unification dealt with under Section 23 of the Basic Law and not by a constitutional conference. I hope that I have accurately summed up the current views of the Foreign Secretary as they constitute Her Majesty's Government's current policies in that crucial area.
Perhaps the noble Lord, Lord Brabazon, will deal with those points because they lie at the heart of this debate. I personally do not quarrel with them, although I think that there is an argument for a constitutional conference as a safer way of achieving a stable arrangement. We have a right to be deeply concerned about the ultimate outcome of these profoundly significant changes. Even if unification is now inevitable, we have a duty to co-operate with all concerned to ensure that a stable and democratic new Germany is created.
That also seems to be the broad objective of the Soviet Union, whose interest and involvement, bearing the last war in mind, are at least as great as those of the West. Its agreement with any final settlement is crucial if we are to have confidence in its permanence. A neutral, unified Germany fails to appeal to me, but a West Germany within the European Community and NATO does appeal to me. But that is a personal view.
The noble Lord, Lord Home, referred to the changes now taking place in the Soviet Union and to their implications generally. In all the convulsive and historic events which have shaken the world in the past 18 months, Mr. Gorbachev has played a central and crucial role. He has been the catalyst of change. There is no doubt about that, whatever the motives— and I tend to agree with the noble Lord that the basic motives may well have been economic. When we think of his predecessors and the Cold War, and the miserable decades the East European countries have suffered, we must pay him proper tribute. Mr. Gorbachev has huge problems to tackle and to resolve in the Soviet Union. He has now assumed extensive powers— some say excessive powers— to enable him to deal with the economy and the resurgent nationalism of some republics in the USSR. He has a dangerous and uncertain job; I think we should wish him well. If and when he succeeds there are those powers to be shed. I understand that in a few years the president will be elected directly.
President Gorbachev's remarkable record up until now gives us hope and confidence that he will use his new powers wisely and cautiously. His announced decision not to use force in Lithuania is both encouraging and clear evidence of that.
Finally, the noble Lord, Lord Home, discussed the implications that these great changes will have on defence and disarmament. My noble friend Lord Graham hopes to deal with that in greater detail later in the debate. However, events now make it

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possible for disarmament on a very large scale to take place. Soviet troop withdrawals are proceeding in some countries and requests for withdrawal are being made by others. The Warsaw Pact itself, based as it is on bilateral treaties, must be in disarray and the consequences of this and of the effect of large scale withdrawals is another of Mr. Gorbachev's problems. It seems clear that the CSCE Conference of 35 nations with the United States and Canada assumes a greater importance. I hope that Her Majesty's Government will have clear and constructive policies to meet the new situation.
We must continue to sustain NATO but, as I have said in previous debates, we must reassess its objectives and its strategy. We should indeed have started doing so before now. I urge the Government to take the intiative in calling for a NATO summit with the clear objective of reshaping the organisation and also of discussing how our expenditure can be reduced through the CFE process of negotiation.
We can now look forward with greater confidence to the forthcoming treaty on conventional force reductions in Europe including the ceiling of 195,000 troops for both the United States and the Soviet Union. in Central Europe. Perhaps the noble Lord will be good enough to comment on this and on the status of Soviet forces in East Germany.
Our longer term objective must be a new security system in Europe as a whole. We should not be thinking of this as "pie in the sky". We should be giving serious thought to it and planning for it. As the noble Lord said, aggression is not an option for either side any more. A Marshall Plan, or its equivalent, organised by the European Community, will become a more realistic prospect if substantial disarmament takes place.
The young men who marched to the First World War sang a song the words of which I well remember. They are:
"There's a long, long trail a'winding Into the land of my dreams".
But the long, long trail led to the Somme and to Passchendaele and the death of millions, and, eventually, to the Second World War, which most of us remember. The European Community came into existence after the war not merely to set up the common agricultural policy, not to produce more wheat and more wine, but to make sure that the flower of Europe's youth should never again be slaughtered in terrible wars. That was the main reason behind the Treaty of Rome and the European Community, and we should never forget it. The great opportunity to lay new foundations has, I believe, arrived and if we do not grasp it we may not deserve to survive.
In A Tale of Two Cities, Charles Dickens wrote of,
"the best of times and the worst of times … the age of wisdom and the age of foolishness … the age of light and the age of darkness … the spring of hope and the winter of despair".
Let Britain and the countries of Europe work together to make this "spring of hope" and a new opportunity for the people of Europe and the world.
3.25 p.m.
Lord Thomson of Monifieth: My Lords, I join with the noble Lord, Lord Cledwyn, in his expression of thanks to the noble Lord, Lord Home, for initiating this important debate. I join with both of them in the tributes to Lord Stewart of Fulham— Michael Stewart. I was proud to have served as his deputy for a number of years. He made a very distinctive and fine contribution to international affairs in both Houses of Parliament.
The noble Lord, Lord Cledwyn, quoted Charles Dickens, and it is an appropriate quotation. I cannot recall a period in all the years during which I have had an interest in international affairs which has been more a time of hope and equally more a time of uncertainty.
The historic and headlong changes now taking place in the Soviet Union and East and Central Europe dangle before us, as the noble Lord, Lord Cledwyn, said in his eloquent closing passages, the glittering prize of a disarmed Europe at peace with itself for the first time in this century and with the personal liberties and material prosperity of the West being spread to the remainder of the Continent.
After our intitial euphoria, however, we are coming to realise that it is an awesome task, as the noble Lord, Lord Cledwyn, said, to create liberal pluralistic societies from the ashes of one party states. Moreover, I believe that we are becoming increasingly aware that a failure to do so will not mean a return to what some rather nostalgically feel are the comfortable certainties of the Cold War. It would instead mean a return to what the Financial Times the other day described as,
"A cockpit of squabbling nationalities dominated by the awful prospect of a pauperised super power with a huge nuclear arsenal".
Mr. Shevardnadze said the other day, after the Ottowa Summit:
"If perestroika collapses there is a risk we could have a dictatorship".
Therefore what is the wisest way for Western statesmanship to seek to maximise hope and minimise uncertainty?
First and foremost, as the noble Lords, Lord Home and Lord Cledwyn, have indicated, it is to do what we reasonably can to ensure that Mr. Gorbachev and those who share his views in the Soviet Union are able to be successful. It is the truth that it was the Stalinist regime, the Brezhnev doctrine, that held the Soviet empire in Eastern Central Europe together.
The other side of that is equally true. If Mr. Gorbachev were to fail, then the effect on the other countries of Eastern Central Europe would be very serious indeed. I notice that President Havel of Czechoslovakia said the other day that by far the best way that people in the West could help Czechoslovakia is to ensure that Mr. Gorbachev and his reforms were successful in the Soviet Union.
The strategic framework for the West, as the noble Lord, Lord Cledwyn, said, must for the present time remain NATO even though its counterpart, the Warsaw Pact, is more a matter of fiction than of fact. A constructive formula, or one that the Soviet Union is at least ready to acquiesce in, has to be

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found for a Germany which includes the former DDR and yet remains in the Western Alliance.
Perhaps I may adopt a favourite phrase of the Government in other contexts. So far as concerns NATO, the status quo is not an option. I echo the words of the noble Lord, Lord Cledwyn, that what is needed is a lot of hard and fresh thinking about the changes required in the operations of NATO to meet this radically different situation. I very much hope that the Government will play a positive part in that. I shall leave it to other noble Lords and to my noble friend Lord Bonham-Carter to develop those issues on the collective security front.
I want to concentrate for a few minutes on the economic issues of our relationship with the former Communist world. The global financial framework can only be, as the noble Lord, Lord Home, said, the IMF and the World Bank. However, within that, as the noble Lord, Lord Cledwyn, indicated, there are compelling reasons for the initiative lying primarily with the European Community. I notice that that has been recognised in the arrangements for the East European Development Bank. That is being set up by the countries of the group of 24 including the United States and Japan but those two countries have accepted that the EC should have 51 per cent. ownership of the bank, and that the bank should be located within the Community. I hope that the Chancellor and the Foreign Secretary are successful in their bid to have the headquarters of that bank in this country, although I am bound to say that the Prime Minister's approach to economic and monetary matters within the Community can hardly help them in their efforts.
It remains vital to maintain a positive American strategic and economic commitment to stability in Europe. In my judgment, the best way to do that is for the nations of the Continent to show that they are ready to help themselves. Within that, the best way to do that is to have in the heart of Europe a strong and integrated European Community. The results of the first free elections in East Germany for over 50 years reinforce that view, and indeed Chancellor Kohl has emphasised the need for deepening the Community's unity at the same time as Germany is reuniting.
I believe that to talk about the countries of Eastern and Central Europe becoming full members of the Community in the immediate future is, as the noble Lord, Lord Home, said, premature. The DDR is bound to be incorporated in the Community; and given its ramshackle state economy, that will certainly present us with plenty of problems. However, that is a special case because it is part of the German nation, and as the noble Lord, Lord Cledwyn, said, it has the immense advantage that within the boundaries of the new Germany, two-thirds consists of West Germany with its immense managerial, entrepreneurial and sophisticated skills in running an extremely successful and civilised pluralist society.
If the Community does not make itself capable of giving the necessary lead in these matters, we must recognise that a reunited Germany will inevitably, against its own inclinations, find itself playing a
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major role increasingly on its own. The Federal Republic, with Europe's strongest economy— as anyone in Eastern Europe today can see— is by far the largest provider of trade and aid to Eastern Europe. The Federal Republic has by its own efforts built a robust economy and a thriving democracy. It has taken the lead in turning its back on the past and in seeking to secure its future within an integrated European Community. Therefore, those who are inclined to feel half-hearted simultaneously about German reunification and European integration are taking considerable risks about the future.
The completion of economic and monetary union within the Community is the necessary prerequisite to give the Community the cohesion and decision-making structure in order to give maximum help to the countries of Eastern and Central Europe, and to shape the Community's future relations with them. In all those countries there is now a dangerous gap between politics and economics. The political revolutions have taken place almost overnight and they enjoy immediate popularity. However, as we recognise, economic change takes a long time and is often unpopular and painful.
That sombre economic background to hopeful political reform represents an immense challenge to the West. I echo the words of the noble Lord, Lord Cledwyn, that what is needed from the West is an imaginative response in its concept and vision which is comparable to the Marshall Plan at the end of the Second World War. Of course, historical analogies are always viewed with caution. The needs in the Soviet Union and the countries around its borders are very different from those of Western Europe at the end of the Second World War. The Soviet Union and the countries around it need a flow of long-term investment backed by an institution like the European Investment Bank. They perhaps need trade more than aid. They need a much more liberal transfer of technology once the security considerations of the Cold War have begun to fade. Most of all, they need a transfer of human resources.
I remember once hearing a story— no doubt apocryphal— of Sidney and Beatrice Webb, the great Fabians, going to visit the Soviet Union while Lenin was still alive. They asked Lenin what he most needed to make a success of the Soviet revolution. I think that they expected him to give them some sort of ideological reply about the help that the Left-wing movements in the outside world could give him. To their surprise he said if it had been practicable, he most needed 100 first division British civil servants. Perhaps the developments in the Soviet Union might have been different if that had been practical politics.
What is practical politics today is what the Government are presently engaged in with other governments of the Western world and the European Community— that is, a massive injection of the wide diversity of skills which go to make up a modern civil society. I am thinking of the people who are experts in business management, local government, running democratic political parties and those who know about creating independent press and broadcasting systems in a modern democracy. That

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is why we welcome the Government's know-how funds and are glad that they are to be extended to other countries beyond Poland and Hungary.
In all those developments Britain has a leading and constructive role to play. It seems a great pity that the Prime Minister has such strong personal and idiosyncratic views on some of those issues which tend to isolate her from her allies and from the possibility of exercising Britain's full influence. Perhaps her present preoccupations on the domestic front will allow the Foreign Secretary and his collegues to get on with the job of playing Britain's part without having to divert so much energy into mending the Prime Minister's fences. In so much of that, there is a very broad degree of consensus in both Houses of Parliament and in the country as a whole.
An imaginative and adequate Community plan to help the former Communist countries of Europe would not only help to bridge the dangerous gap between political aspirations and economic reality but would be enlightened self-interest for Western Europe. It would ensure that a new united Germany was fairly harnessed, as its leaders wish, within the Community framework. It would also mean that after 1992 as the internal frontiers of the present Community disappear, they will not be replaced by any new fortressed Europe creating a new type of Berlin Wall between East and West.
In all those matters, I believe it to be of critical importance that Britain should play a proper leading role in those Community developments instead of going along, as so often happens, rather grudgingly and finally acquiescing in decisions which it has done too little to shape. The historic developments now taking place in the Soviet Union and Eastern Europe present a new situation and I hope that they will produce new attitudes from Her Majesty's Government.
3.39 p.m.
The Minister of State, Foreign and Commonwealth Office (Lord Brabazon of Tara): My Lords, like the noble Lords, Lord Cledwyn and Lord Thomson, I am most grateful to my noble friend Lord Home for tabling a Motion today which allows us a further opportunity to debate developments in Eastern Europe and the Soviet Union. I am sure that noble Lords will agree that that is both timely and welcome. I should also like to add to those who have spoken in paying tribute to the late Lord Stewart of Fulham and to say how sorry I am that he is no longer in his place to take part in our debates on foreign affairs.
The scene in Central and Eastern Europe is perhaps less dramatic than it was a few months ago. Events are settling down. While there remains the potential for instability, we are entering a phase of consolidation; one of holding elections, establishing democratic institutions and the rule of law; and one of introducing market-based economic reforms. All these steps are essential if these countries are to enjoy lasting freedom and prosperity.
The people of the German Democratic Republic are of course in a special position. They have already been to the polls, and there can be no doubt that
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they have voted for a new beginning and a democratic future in a united Germany. They have our warm good wishes. The parties of the Alliance for Germany now have a mandate to form a democratic government that will begin negotiations with the Federal Republic of Germany on the mechanics of unification. Intensive consultations on the external aspects also lie ahead, and Britain is fully engaged in these through the two-plus-four framework agreed in Ottawa last month.
Meanwhile, however, the pace and drama of events in the Soviet Union have accelerated. The Soviet political scene is littered with the freshly slain carcasses of doctrinal sacred cows. It is sufficient only to look at the events of the past few weeks: Mr. Gorbachev's election to a new executive presidency by a parliamentary assembly more representative than anything seen since the immediate aftermath of the revolution; the decision to abolish the Communist Party's constitutional monopoly of political power; the legalisation of some forms of private property; substantial successes for non-party candidates in free local and republican elections; and, finally, a declaration of independence by the Parliament of a republic— Lithuania— in which the communists are a minority. These may be uncharted waters but the current is towards democracy, and that is profoundly welcome.
Against this background, Her Majesty's Government have two priorities. First, to offer support for the process of reform in Eastern Europe and the Soviet Union. Secondly, to co-operate with others to ensure that Europe's security and stability is maintained and strengthened in the transition to a new pattern of relationships between its nations.
It is very much in our interests to support political and economic reform as far as we can. East and West stand to benefit from the increased opportunities for contact and co-operation which successful reform will bring.
In the case of economic assistance, it is necessary to distinguish between what we can do for Eastern Europe, and what is possible in the case of the Soviet Union. There, key decisions about making the economy more decentralised and responsive to market forces have still to be taken. The scale of the problem is also much larger, and the impact of any Western help would be correspondingly smaller. Moreover the Soviet Union is already rich in resources: it is the present poor organisation of the economy whch denies its people a higher standard of living. For all these reasons, the scope for the West to use its finite resources to assist the Soviet Union, should any request be received, is more limited. It will be important to ensure that our help is geared to the introduction of market mechanisms and essential skills. Britain is already doing this in a number of ways— for instance, through help with management training.
It is of course for the countries concerned, with our advice and support where it is requested, to introduce and to sustain the policies necessary to transform their societies, as the noble Lord, Lord Cledwyn, said. Their leaders will need political will and courage to see the job through. So far, there

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appears to be no shortage of either quality, and that is most encouraging.
We are offering support for political reform in various ways. Political contacts are being revitalised at all levels. My right honourable friend the Foreign Secretary has so far this year met all his East European colleagues at least once. He and my honourable friend the Minister of State have between them visited almost all the countries of Central and Eastern Europe in the same period. The Polish Prime Minister was here recently, and this week President Havel is a most welcome visitor. These intensive contacts and consultations are helping to lay the foundations for more normal relations between our countries in future. It is important to demonstrate readiness to welcome the reforming countries fully into the democratic community of nations.
The Council of Europe offers an institutional link. We support the extension of its membership to the emerging new democracies on our continent. We are also ready to assist the process of developing democracy through practical advice and support. Noble Lords will be aware of the initiative announced by my right honourable friend in another place on 22nd February. This aims to give help on an all-party basis to political parties in Eastern Europe and perhaps elsewhere. Consultations are continuing with the opposition parties and others within the Palace of Westminster.
Economic co-operation and assistance can help to provide the East European countries with a bridge to future prosperity. The view is sometimes heard that Western countries are not doing enough in this field. I disagree. In only a very few months a remarkable range of initiatives has been launched. We are, however, only at the initial stages of what must be a sustained commitment over many years. That point has been echoed in all the speeches before mine. The purpose of this support cannot be to underwrite the devastated economies of the East. Our own resources are not limitless, and, as I have mentioned, the primary impulse for reconstruction must come from within. Instead, we should opt for carefully targeted assistance to ease the inevitable pain of transition to market systems, and to develop the private sector as the main motor for future growth.
It is important for Western businesses and companies to involve themselves in this process. They possess the experience and skills which are so desperately needed in Eastern Europe. They should take a long term view of the market opportunities and potential there. Investment may be slow to yield returns at first, but substantial rewards are likely to accrue as reform proceeds. I hope that British companies too will now begin to look seriously at the possibilities.
I can confirm to the noble Lord, Lord Cledwyn, that the European Community is playing a central role in supporting the process of economic reform. The Commission is co-ordinating the wider effort of the OECD countries. Community countries have successfully floated a proposal for a European Bank for Reconstruction and Development, and work on
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its establishment is now well advanced. Its initial capitalisation will be £ 6.5 billion and, at Britain's suggestion, its activities will focus in particular on support for the private sector. As the noble Lord, Lord Thomson, said, there is a good case for the bank's headquarters to be located in London, and we are pressing our case with Community partners and others.
The Community is also supplying food and other forms of urgently required short-term assistance to countries such as Poland and Romania. For the longer term, we want to make more of the Community's trade and co-operation agreements with Eastern Europe, and to develop new and closer forms of association between our countries. Britain has suggested that these might include new agreements whose scope and content can be increased as the economies of Eastern Europe diversify and grow.
My right honourable friend the Foreign Secretary has emphasised that the Community must remain open and welcoming to the East. Britain believes that this ought logically to lead to the eventual possibility of full membership of the Community for those countries wishing to join and able to meet the obligations of membership. This is not simply a matter of sustaining prosperity and growth in Eastern Europe. It is also a way of developing the Community's role as a force which can draw Europe's nations together through strong ties of mutual interest and close co-operation.
Beyond the Community, Britain is contributing to multilateral support programmes for Poland and Hungary through the IMF and the World Bank. We are ready to participate in similar programmes for other Eastern European countries once approved measures of reform are in place. On our own account, we have established "Know-How Funds", to which the noble Lord, Lord Thomson, referred, for Poland and Hungary. These are worth £ 75 million. We are using them to help develop the skills needed to run a successful democracy and market economy. Their great advantage is their flexibility, permitting a wide range of disbursements and applications. We plan to extend the coverage of these funds to other countries which have clearly committed themselves to wide-ranging reform.
In the case of the Soviet Union we are anxious to develop further our already excellent relations. We engage in close and regular consultations with the Soviet leadership on a wide range of issues. My right honourable friend the Prime Minister plans to visit the Soviet Union in June, and my right honourable friend the Foreign Secretary rather sooner. Our aim is to be able, with other Western countries, to regard the Soviet Union as a friend and partner, more closely integrated into the international community. We wish, for example, to develop further the useful co-operation which we now pursue together in the United Nations. We are also supporting the Soviet application for observer status in the GATT.
In general, we are working for a sound and co-operative relationship which will underpin our common efforts to advance the process of arms control and reinforce security in Europe. The continuation of President Gorbachev's reform

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policies will greatly improve the prospects for a lasting transformation in East/West relations. Like my noble friend Lord Home and the noble Lord, Lord Cledwyn, we greatly admire the task which President Gorbachev has set himself and we fully support his policies. He faces formidable challenges. Increased freedom has brought new tensions and pressures into view. We trust that President Gorbachev will use his newly acquired powers wisely to overcome these problems and further to expand freedom in the Soviet Union.
There have been indications that President Gorbachev is ready to allow the Soviet Unions's republics to choose their own destinies. Procedures which would allow eventual secession have been promised and the process of working these out has now begun. We are naturally concerned at the recent increase in tension surrounding the situation in Lithuania. However, we have seen no evidence to suggest that President Gorbachev is contemplating the use of force, which he has previously ruled out. We believe he is well aware of the damaging consequences of any resort to force for all that he is trying to achieve in the Soviet Union. It is encouraging that both sides seem to want further talks. We hope that negotiations with the Lithuanians will lead to an orderly and amicable settlement which will allow the Lithuanian people to exercise their right to self-determination.
At present the overall situation in the Soviet Union is still fluid and uncertain. Nor can the potential for instability in Eastern Europe be ignored. Besides support for reform, therefore, our second priority should be to apply the discipline of diplomacy to the challenge of accommodating change. We need to preserve a strong overall framework of European security and stability. It makes sense to adapt and develop existing structures and institutions. These are readily available to serve new tasks, such as managing the changes now taking place. They have also served us well in the past.
NATO remains central to our concept of European security. It is a free association of equal partners for the purpose of collective defence and the pursuit of arms control. It has proved a flexible and reliable anchor of stability in Europe for over 40 years. I do not believe that NATO will lose its relevance in the 1990s. As my right honourable friend the Foreign Secretary said, our security needs will change, but the need for security will not. NATO was never conceived as a temporary arrangement but as a lasting focus for confidence and mutual support in matters; of defence.
It is no longer sensible to speak of an immediate threat from the Warsaw Pact or the Soviet Union. But the Soviet Union is likely to remain a formidable military presence within its own borders if not, ultimately, in Eastern Europe. While we welcome the Soviet Union's evolution towards domocracy it is prudent to bear the military realities in mind and to remember that there is still a lot of evolving to be done. The link which NATO provides to the United States will therefore remain important for Western Europe. So, too, will NATO's role as an insurance policy against uncertainty and possible instability in future. We may also have to face new threats
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associated with weapons proliferation in neighbouring regions.
My right honourable friend the Foreign Secretary has listed some characteristics that it would be sensible for NATO to retain. These include its present membership, a sensible mix of nuclear and convention forces, the presence on the Continent of significant stationed forces including those of the US and Britain, and in integrated command structure. But we should aim to develop new approaches for NATO in other areas. For example, we need to consider how to take forward the process of conventional arms control after the successful conclusion of a Vienna agreement. NATO should not surrender the initiative it has gained with its imaginative proposals in Vienna. There should be fresh thinking about the strategies that we shall need at lower levels of forces, including the development of the concept of minimum deterrence, to which my noble friend referred. We ought to aim to improve further political consultation and European defence co-operation within NATO. We might also seek more dialogue with the Eastern countries.
Defence is an important element in security; but we seek a Europe in which all can enjoy equal security in a wider co-operative framework. We believe that the CSCE can be developed as a framework of this kind. My noble friend the Lord Privy Seal will set out our ideas in more detail in his winding-up speech.
A united Germany will lie at the geographical centre of the future European security system. It will also possess great economic strength and considerable political authority. We are now engaged in a common effort to resolve the external aspects of unification. We are confident that a united Germany will emerge as a welcome and influential force for strengthening the European system.
Between the two-plus-four arrangements, NATO, the Community and other consultative links, we now have a satisfactory framework for addressing the external aspects in a confident way. The first meeting of the Six took place in Bonn last week. It made useful progress with procedures and settled an important point of principle. That was the principle that Poland should be involved when border issues are discussed. In this context, Britain very much welcomes the decision of the FRG to work for a treaty which guarantees the existing border.
As the noble Lord, Lord Cledwyn, said, other important questions remain to be resolved. We welcome the very clear statements from Chancellor Kohl that a united Germany should remain within NATO. This is the best way to ensure that German unity contributes to confidence and stability in Europe as a whole. Poland, Czechoslovakia and Hungary have recently stated their support for continued German membership of NATO. We hope that the Soviet Union will join the strong European consensus on this point. It is right to acknowledge her legitimate security concerns, and the proposal for transitional arrangements governing the status of Soviet forces in the GDR is intended to provide reassurance that these are not being neglected— a point raised by the noble Lord, Lord Cledwyn.

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NATO has never been a threatening alliance, nor will it threaten the Soviet Union with a united Germany as a member.
We have also to resolve the question of the progressive integration of the GDR into the European Community. There will have to be transitional arrangements in a wide range of areas. It is clear that an economy which has for over 40 years developed along very different lines from those of the existing members cannot be accommodated overnight— a point made by the noble Lord, Lord Thomson— but for the sake of the well-being of the East German people, and for the preservation of the momentum of the Community's development, we hope that the transitional period can be kept as short as possible. My right honourable friend the Prime Minister will be discussing these matters with other Community leaders at a special summit in Dublin next month.
Finally, there is the question of the future of the four-power rights and responsibilities in Germany and Berlin. We have no desire to perpetuate these as anachronisms in a united country. We must therefore consider, in the framework of the two-plus-four meetings, how to tackle this issue in an orderly and satisfactory way. The Federal Republic is a close friend, ally and partner of this country. We admire the post-war achievements of her people. We look forward to a time when these can be shared by all the citizens of a united Germany, within a Europe where all divisions have been overcome and all can feel secure.
I think that in the CSCE, the Six and elsewhere we are moving towards the kind of solutions envisaged by the noble Lord Greenhill when he proposed in our debate in January a treaty for the pacification of Europe. I do not say that such a treaty is necessarily the best solution— the final form of a European settlement has still to be decided— but I hope that we are approaching a time when the countries of Europe will agree to be bound by certain common standards and principles, in a security framework accepted and supported by all.
These are the goals towards which Her Majesty's Government are working. We are developing links with the countries of Eastern Europe and the Soviet Union which reflect and reinforce the increasing community of interest between us. With our Western partners, we are pursuing programmes of assistance in support of the economic reforms which must serve as the basis for future prosperity, We are also looking ahead to the requirements of European stability and security in a continent transformed by the need of the cold war.
Uncertainties remain, but the prospects for reconciliation and renovation in Europe have never looked brighter. I hope that Europeans will be inspired and guided by them as we advance together towards a better future for all our countries and peoples.
4 p.m.
Lord Greenhill of Harrow: My Lords, I would like to apologise to the Leader of the House and to the
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noble Lord, Lord Home of the Hirsel, for the fact that I shall be unable to be present for the closing stages of the debate. It has been said again and again that the events of the past year are a turning point in history: that is indeed true. I believe that it is possible to have high hopes for the future if we are persistent and, above all, if we are patient. As the noble Lord, Lord Cledwyn, said, there is a long, long trail ahead.
What has happened to date has been largely acts of demolition. Evil regimes have been swept away; the path to democracy has been cleared; and the threat to peace has virtually disappeared. But an immense work of construction lies ahead. One has only to enumerate the agenda for 1990–91 to see the confusing complexity of the situation. I am not sure that I have included all the items on this agenda.
In the Soviet Union, President Gorbachev is facing up to the revolutionary task that he has set himself. But progress is slow and his economic plight is desperate. I have not recently visited the Soviet Union, but all visitors who come back now bring bad news. In Germany the process of unification has started, but the federal election still lies ahead and must preoccupy the party leaders. In the Community of Twelve there are preparations for inter-governmental conferences, not only on economic matters as agreed at Madrid, but now also on ambitious, political and constitutional proposals which we understand will shortly be put forward.
In addition, there are important negotiations in train between the Community and the EFTA bloc. In Eastern Europe there are elections and the task of drawing up new constitutions. For NATO and the Soviet Union there is a new security situation to resolve. For all of us there is an immense and conflicting investment demand in Europe, a similar demand still in the third world and, looking a little further ahead, possibly also in Southern Africa. The Commission has been given a most difficult task in co-ordinating all this. It is impossible to imagine sensible and consistent outcomes to all these matters if there is a headlong rush for solutions.
Those people who seem to fear that they may miss the bus need to reflect carefully upon whether matters are going in the right direction. That is why, in my view, although urgency is necessary, it must be combined with great patience. I would like to draw attention to certain questions, particularly concerning the Soviet Union, Germany, the United States and the Community of Twelve.
As regards the Soviet Union, distinguished historians have said that no empire has survived once it starts to decentralise. That, they say, will be the fate of the Soviet empire. It may well be true. Personally, I doubt it. And it is not in our interest that it should be so. I believe that, over a period of time, the Soviet Union, in a recognisable form, can and will survive.
The sort of democracy which the Soviet Union will develop is not of first importance to us. Nor is the issue of how it will cope with the emotional demands of the republics. What does matter to us is that the Soviet people are no longer putty in the hands of a few authoritarian leaders and will no longer accept ideological adventures. In future we

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shall be able to do business with them without undue fear and foreboding and with a greater degree of mutual understanding.
But the Soviet Union will want to remain a nuclear power with the capability of organising large conventional forces. Diminishing suspicion of Germany and the West will no doubt linger on, but it should be possible for understanding on defence matters to be reached. The Soviet Union's own first priority will be its economy.
In Germany, unification is taking place before our eyes. But there are countless political and social problems which, even with strong political will, must take German governments years rather than months to resolve. United Germans will make up their own mind;; on their future policies. Any rushed attempt to anchor or embed— which seems to be the latest word— them where they do not want to be will be counter-productive. It is inevitable in the months ahead that they will give priority to their own affairs.
On the prospects for the Community of Twelve I find myself in some doubt in the light of recent events. The advocates of the original Delors plan were all for pushing ahead at an accelerated pace. But they now find their ambitions supplemented by the plans of activists in the European Parliament who seek a greatly enhanced role for themselves and a reduction of the power of the Commission and the Council.
I recognise that there is a democratic deficit in the Community. I certainly do not think that it is the moment for the type of plans which are being bandied about. At the same time the Community of Twelve sometimes gives the impression that it wishes to retain a privileged position and keep at arm's length some countries which seem to be natural members of a Western European community. Would it not be better, in a measured way, to make a reality of the single internal market, seek a profound agreement with the EFTA bloc, and subsequently, at appropriate times, make association agreements with the Eastern Europeans? That would pave the way for a wider Community which is surely the most desirable objective for Europe.
As for the United States, I am sure that it is necessary and right for it to retain a security role in Europe. I understand that this is recognised and welcomed by the majority of Germans and indeed by some Russians so long as they retain any suspicion of a unified Germany. The United States obviously cannot have a seat at the Community table, as Mr. Baker once suggested, but it is an essential element in the stabilisation of Europe.
In the immediate future, surely one of the most important things to do is to push ahead with the two-plus-four discussions and develop them into a treaty which makes specific settlements of certain questions. That treaty should be absolutely clear about disputed frontiers. It would mark the removal of allied rights in Germany. Associated with this treaty, or integrated with it, would be disarmament agreements including troop withdrawals and a new definition of the relationship between NATO and the Soviet Union.
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In making such a treaty the United Kingdom can play a leading part which would be welcomed. This, in my view, is as important, if not more so, than the accelerated development of the Community of Twelve, which has enough to do with the internal market in the next three years without raising new issues of an extended role for a two-chambered European Parliament and fundamental reforms of the Commission and the Council.
But if for Europe and the Western world we have high hopes for the future, we cannot ignore the fact that, powerful as Europe can be, we are a minority of the world population. We do not have a monopoly of advanced technology nor of vital natural resources, and the objectives of a non-proliferation nuclear treaty are still very far from being fulfilled. As much as we all need economies in defence expenditure, any British Government must bear in mind the possibility of global developments at present unforeseen.
4.11 p.m.
Viscount Eccles: My Lords, I thank my noble friend Lord Home for introducing the debate in a speech to which we all listened and from which we all learnt something. I am also pleased to follow the noble Lord, Lord Greenhill, because his knowledge of foreign affairs is unsurpassed in this House.
Last week The Times published an article by Sir Michael Howard. The gist of that article was contained in these sentences:
"There is a German problem … An alliance without the US would be an alliance dominated by Germany. The peoples of Central Europe and the Soviet Union… would see that as a threat".
Well, we too, although we are much less fearful than the people in Eastern Europe, have to remember that twice in this century we have crossed the Channel to prevent a Europe dominated by Germany. In those experiences we have had proof that an alliance without the Americans is not capable of maintaining the balance of power in Europe.
However, M. Delors, the President of the European Commission, has other views. Speaking presumably for France, as well as for himself, he has been telling his considerable following that the social and political functions of the Community should be increased to the point where all the big decisions concerning Europe's future are discussed and settled in Brussels. The French have never had any wish to share power with the United States. They refused to allow the American bombers to fly over France when they were on their way to teach Colonel Gaddafi a lesson. The Spaniards, the Italians and the Greeks have shown resentment towards American bases, but they did accept American leadership so long as the two super powers were glaring at each other in the Cold War. But now, with the Warsaw Pact in disarray, is there any future need for American participation in the political affairs of Europe? What should be the British answer to that question?
As has already been said in the debate, no one knows what will happen in the Soviet Union. Caution and patience are therefore essential. But we can, and I think we should, make some assumptions about the long term. For instance, until the Soviets

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destroy the whole of their nuclear capability the West will retain its own deterrent. How do we rate the chances that after the reunification of Germany the Russians will trust the Germans to guarantee their security and will work harmoniously with them, perhaps in the Community, to revitalise their own economy and the economies of Eastern Europe?
I wonder how much personal experience noble Lords have had of the enmity which the Russians feel towards the Germans. When I was President of the Board of Trade I went to Moscow to make a commercial treaty. Mr. Khrushchev asked me one day, "Do you believe in the devil?" "I do", I said, "but do you?" He replied, "Oh yes, and I know who he is— Dr. Adenauer". Mr. Khrushchev was thinking of the 20 million Russians who died in the last war, and that tremendous sacrifice is remembered today by all the Russians whom I know. It should therefore be assumed that the Soviet Union will ask for guarantees of peace and will not trust the Germans to give them those guarantees. Only the Americans can do that for Europe.
We should welcome the participation of the Americans in European affairs for another reason. We are all looking for new initiatives and new relationships, not just between the countries of Western Europe but with the rest of the world. As has been said, huge opportunities are opening up before us. With the reduction of the military threat we can pay more attention to social, cultural and economic progress, especially in the less developed countries. The titanic revolution stimulated by the media feeds on the instant coverage of everything that happens, every day, everywhere. One result is that all nations can now see each other. They can compare each other's standards of life. The information network puts before all of them the same world problems of poverty, population, environment, refugees, terrorists, trade, exchange rates and so on.
For the moment, I suppose, we here are preoccupied with the prospect of free trade and responsible capitalism flourishing throughout Western Europe. Western Europe is a trading area which can be defined, marked on the map and policed at the boundaries. By contrast, the political and social problems in which we are all interested stop at no frontiers. Television and radio carry them around the globe.
Most of these problems are obviously too widespread and too contagious to be dealt with on a continental scale, as I understand the French would wish. Instead, combined action is called for in groups of nations brought together by common interests. In most of those groups the United States will have to play a leading role. Great Britain cannot go it alone in the modern world. Who then are our best and strongest friends and allies? Who speaks the same language as we do? In whose schools and universities are English literature and English history taught as key subjects? In which economy do we have our major overseas investment? With whom, if your Lordships were to look around the United Kingdom, do we have so many blood relationships and so many family ties? Since in this shrinking world we have to
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share our sovereignty, we should do so with our best friends and in organisations designed to leave the door open for Eastern European countries and the Soviet Union to join one day.
President Gorbachev is also seeking a new balance of power. He knows that he will not find it in an alliance of which the United States is not a member. In any case, the timetable rules out the European Commission as an alternative to negotiating through NATO. It will take two years or more before the 12 members come to a decision on how much political power they will give to the Community. However, in the very near future action must be taken on the relations between the Soviet Union, a reunited Germany and the rest of us. That action can only be debated and decided in NATO, because NATO is the agency of which the United States is a member. As the noble Lord, Lord Greenhill, said, NATO has to be revised so that it can deal not only with the military problems but also with a great many of the world problems which will grow in importance.
I am sure that some of your Lordships heard this morning at breakfast time a broadcast which stated that Mr. Gorbachev had given the United States assurances about troop movements in Lithuania. He did not give it to the Community and he did not give it to Germany; he gave it to the United States. That is how the whole process will go.
Finally, I think that we should send a message to the Prime Minister stating that a revised NATO, rather than the Commission in Brussels, is the agency through which we are going to work to ensure the stability and the prosperity of the post-Communist world.
4.22 p.m.
The Earl of Perth: My Lords, I rise to make one point and only one point. Having heard the speech of the noble Viscount, Lord Eccles, who made my point so well and so skilfully, I hesitated before I rose to speak. Nevertheless, as my name is on the speakers' list I shall proceed. No one, not even the noble Lord, Lord Home, who so courageously and bravely opened the debate, can forecast the future of the European Community, including, for example, how Eastern European countries and Russia will join in with us. But, whatever the developments may be, it is vital— this is my point, which was also made by the noble Viscount, Lord Eccles— that the USA remains involved.
We Europeans must consult the Americans on every move we make and take them with us. The noble Viscount, Lord Eccles, pointed out how they came to our rescue in both world wars. However, I should like to look at the situation from a slightly different angle. What happened after the first world war when America did not join the League of Nations; what happened in the tragedy of Suez when we and France went it alone?
I turn now to Germany. I think that over the next years a united Germany will not only prove to be a good and true member of the Community, it will also have a leading part to play in the economic and other developments of Europe. But it is even more important to know that America will be involved.

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Let us remember that the vast majority of people in America are made up of inhabitants whose ancestors all came from Europe. Therefore they know about it and are deeply concerned about developments. I repeat, America must be a part of the development process. It must support, or at least we must be assured that it goes along with, what the Europeans, West or East, do. Moreover, whatever we may do to help ourselves build a new Europe, they must be a part of it.
The noble Lord, Lord Greenhill, pointed out that Mr. Baker suggested that perhaps the Americans should have a seat in the Community. However, he said that that proposition was not on. I wonder about that. I think that we should give careful thought to that prospect. If America does not actually have a seat, it must be an observer— and perhaps more than an observer. I should not be afraid if that gesture was made. Let us think about taking up that suggestion.
In my view the Americans must be physically involved. That means that not only should they do anything which was needed in relation to economic aid, but also they should keep some forces in Europe. As to where and how many, that is, in a sense, unimportant; the fact is that they should be there.
I strongly believe with all my heart, and because of all my experience, that this is the keystone for an enduring peace and progress. The Western world can achieve great things if we work together. But, as I said, the keystone is working with the Americans. Without their involvement I should be fearful for the future.
4.26 p.m.
Viscount Brentford: My Lords, I should first like to thank my noble friend Lord Home for instituting the debate. It is with fear and trepidation that I intervene to speak among so many other far more experienced Members of your Lordships' House. I should also like to apologise to the House for the fact that I am shortly due to board an aeroplane and therefore shall not be able to stay to hear the end of the debate.
The question of freedom for parliamentary and economic matters in Eastern Europe is indeed very exciting. I should like to illustrate what my noble friend Lord Home said about the economic independence of Eastern Europe, and also what my noble friend Lord Brabazon of Tara said about the market opportunities, by citing some interesting figures which I saw about the number of joint venture agreements which have now been entered into between those countries of Eastern Europe and the countries outside, or between commercial ventures in them.
In many cases during the course of 1989 the number of joint venture agreements quadrupled. That seems to me to be a very substantial increase in co-operative commercial enterprise. In the case of Poland, the number during 1989 rose from 26 to about 400, which is a very substantial increase. In Russia the figure similarly rose, from 162 to probably 1300. That shows that the economic co-operation is expanding at a very fast rate. I believe that that is very good, both for the countries of Eastern Europe and for ourselves.
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I should like to make two specific comments on the political scene. I have read that in Westminster we are holding political seminars for parliamentarians in the new democracies of Eastern Europe. I am not sure whether that was included in what my noble friend Lord Brabazon of Tara referred to in his speech. However, I believe that it is something which should be strongly encouraged. I do not know whether the seminars are being held only in Westminster or whether we are also offering help, from our experience as the mother of Parliaments, on parliamentary techniques in the capitals of these other countries. If they are wanted by those countries, I hope that this will be an ongoing support that we can offer them.
The second point I should specifically like to make concerns the question of a united Germany being a part of NATO. This was strongly put by the noble Lord, Lord Cledwyn, and again emphasised by my noble friend Lord Brabazon of Tara. I believe not only that it is a good thing, but that it is a cardinal point for the security of Europe that the united Germany should be firmly within the framework of NATO.
I have never forgotten that some 40 years ago in Germany I was talking to a young German who was the same age as I was. He said to me that if another leader came along like Hitler and did something as popular and as powerful as Hitler did in making roads in Germany, "We will follow him again". I believe that the future security of Europe on the German question depends on it being within the strong framework of NATO, and I hope that my noble friend in the Foreign and Colonial Office will work hard for that to come to pass.
There is another aspect that I think has not yet been mentioned in your Lordships' House but which I should like to emphasise, and that is what I have called the need in Eastern Europe for wholeness of life and a sense of the important values for individuals and also for families in those countries. I should like to illustrate what I mean by certain examples. I have read that it has been said that we need to learn that people in Eastern Europe need themselves to learn to live with freedom. When they were saying something private in the past in many of these countries they would have to turn on the radio full blast, or put the bathroom taps on full blast, in order to drown the bugging devices, they are now living in a totally different situation from what they were a year ago.
It is dangerous to generalise and I know that there are many differences in different countries, but in many of them the people have lived with this situation for so long and they are now in such a different situation that we need to understand their position. There is a mental and emotional leap that they are having to take very quickly, and it is not easy. There are divisions in society that need to be healed, but there are also divisions in the individual that need to be healed. We need to see this sympathetically.
The second illustration I should like to make is what I call the moral factor. May I quote from

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President Havel, who has been mentioned several times in this debate.
"The worst is that we live in a spoiled moral environment. We are all morally sick, because we all have got used to saying one thing and thinking another."
If individuals have been living like this for nearly 40 years it is a difficult situation to get out of overnight. Again this calls for sympathy and understanding by us in our dealings with individuals there. I hope that there will be many relationships to be built in this way.
Thirdly, I should like to emphasise the role of the Churches in bringing about this peaceful revolution in Eastern Europe, particularly and noticeably the Roman Catholics in Poland, the reformed churches in Czechoslovakia, the free churches in Romania, and the Lutheran churches in Eastern Germany, just to pick a few denominations. They have played a great part, and a sacrificial part, in bringing about what has come forward. I have read that it has been said by different people that the collapse of the Berlin Wall was an answer to prayer as much as when the walls of Jericho came down may years ago.
It is perhaps a truism to say for the benefit of our churches— I see that the only episcopal representative earlier in this debate has now left— that the persecuted churches are probably a great deal stronger, and have a more vital spiritual life, than the churches in the softer living West. I believe that we in the western churches will have a lot to learn from the life of the eastern churches. Nevertheless there is a great need in Eastern Europe which can be met both by the churches in the West and also by other Christian organisations. I know from my own experience that a lot of material as well as spiritual help is going into Eastern Europe from these resources. But I believe it is vital that we go to help Eastern Europe as servants, to serve them from a position of humility, and I hope that this will be remembered in the future.
Marxism is often seen as a religion with the state, as God, being idolised. The state has now been dethroned in these countries in Eastern Europe, but, like my noble friend Lord Eccles, I too believe in a devil, even if I do not see him in quite the same shape perhaps as Mr. Khrushchev saw him. I believe that there is a vacuum now, morally and spiritually, in many of these countries of Eastern Europe, and it is important that that vacuum is sensibly filled.
There is a battle for the minds, the hearts, and the souls of the people of Eastern Europe, and we need to be aware of that. I hope that it is not materialism, pornography, and other evils that fill that vacuum and win the battle for these minds. I hope that we shall do all we can in our way to ensure that the people of Eastern Europe gain a sense of the important values of life, and learn to live a whole, balanced and really fruitful life in their new-found freedom.
4.37 p.m.
Lord Kagan: My Lords, in addition to material help, the Baltic states need Western guidance on how to proceed, because insistence on too rapid change can jeopardise the very objective of attaining
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independence. The legal right of the Baltic states— Lithuania, Latvia and Estonia— to seek independence is not questioned by anyone, but the choice to have that right has been given by President Gorbachev. The pace at which it is pursued could jeopardise and endanger Mr. Gorbachev's position.
With his consummate skill, Gorbachev managed to use the pressure exercised on him by Lithuania declaring unilateral independence. In facing Gorbachev with an accomplished fact which could be mistaken for an arrogant, defiant gesture, Lithuania united behind Gorbachev the left opposition and the right opposition within his own Parliament. His opponents were previously attempting to prove that his efforts to liberalise were leading not to democracy but to anarchy and to the dissolution of the Soviet empire.
Gorbachev has for a long time questioned and probably abandoned his belief in Communism, but it would be a fatal mistake to assume that he is not a patriot. He is not in business to see the Soviet empire abolished. He would not have lasted so far if he did not have solid army backing behind him. That is not to be forgotten.
The Western world, particularly the United States which has a sizeable and influential Lithuanian minority, wishes the Baltic states well. There are more Lithuanians living in Chicago than in the capital of Lithuania. From the United States signals have been sent out which always expressed unqualified support for Lithuania's aspiration to become independent. The United States never formally recognised Stalin's acquisition of Lithuania. However, it has indicated recently that it would delay formal recognition pending discussions between the Soviet Union and Lithuania. Other governments in the West stopped short of recognition at this time. The message from the United States was the good girl's message, "The answer is not 'No', but 'Not yet' ".
In an official statement, France reminded the Baltic states that it was Gorbachev who made the present choice possible. The British Foreign Office, through its Minister, William Waldegrave, said that it was fascinated by what was happening, but the time was not yet.
The point I am trying to make is that hints should come from outside to the Baltic countries to watch the pace at which they pressurise the man on whose success their freedom will depend. People have expressed doubt as to whether Lithuania, Latvia or Estonia could survive economically. It is my belief that Germany and Russia are getting together economically. Germany has always been the dominant economic force, the technical language in Lithuania being German. Germany and Russia between them will be able to support and help reconstruction there. It is interesting to note, incidentally, that the German foreign office was muted on the announcement of UDI. It said that it would await results of negotiations between the Soviet Government and the Lithuanian Government.
I wish to say to your Lordships that the powers which Mr. Gorbachev obtained are similar to those

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under Article 48 of the Weimar constitution. It is easy to forget that Hitler assumed full powers entirely constitutionally with the help of the tremendous powers given to the president of the Weimar republic. When given, the powers were meant to prevent dictatorship, but they actually enabled it to happen.
Probably what Mr. Gorbachev hopes for is to present a Finland solution for the dependent states which will probably extend beyond the Baltic states to Moldavia and so forth. The democratic roots in Eastern Europe were never very deep. The hatred of a Stalinist type of despotic tyranny should not be mistaken for a yearning for democracy. Democracy in Central Europe will depend on whether— as the noble Viscount, Lord Brentford, said— the nations are capable of handling it. I think that the Europe we shall see will be dominated by German technology and Russian manpower working in harmony and Central Europe sandwiched between. It has American support.
4.46 p.m.
Baroness Elles: My Lords, over the past few months we have been watching an extraordinary cascade of events. It has been beneficial and interesting to sit back for a little while in your Lords lips' House and discuss the Motion. I join in expressing my gratitude to my noble friend Lord Home of the Hirsel for introducing the debate. We have already heard quite a few different opinions, and the spectrum is so wide that some of us— certainly myself— can only address one or two issues, as I shall in the few words that I wish to say.
I have noticed that one or two noble Lords have felt the occasion suitable to denigrate a little the European Commission. However, it is noteworthy and encouraging to remind ourselves that President Bush asked the European Commission to establish the mechanism to organise the aid programme for Poland and Hungary which has now been extended to include Czechoslovakia. The United States keeps in full contact with the Commission since the aid programme is based not only on the Commission's action but is in conjunction with the Group of 24— that is the OECD countries, which include the United States and Canada.
I wish to emphasise that it is not a question of the Commission getting too big for its boots, as seems to have been the view expressed. It is doing the job it was asked to do in co-operation with those states which have been mentioned by many noble Lords.
The European Community has already set up funding arrangements and put into effect programmes to send humanitarian aid in the form specifically of medicines and food to these countries. I add again that the European Parliament requested and insisted on an increase in the funds which were clearly inadequate for the task which they were expected to carry out. The amount was something like 200 million ecu to begin with; the parliament insisted and the council agreed that this should be increased to 300 million ecu. No doubt at the end of the clay the figure will be considerably more than that.
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There is one word of caution on the kind of economic assistance that is expected to be given from the West to the Eastern European countries. In mentioning those countries I leave out the Soviet Union in this context, which I believe is a separate issue on its own, which sets up quite different problems from those about which I wish to talk now.
There is concern that these countries should not be encouraged to produce goods of inferior quality and expect to be able to export them successfully to the European Community. If the Community is expected to open up its markets— which include the United Kingdom— it would be perfectly right and proper, since everybody wishes the US to be involved in all this activity, to insist that the Group of 24 should also be ready to open up its markets. This will be in order to assist countries which are not even reviving but are initiating economic prosperity. It will enable them to have access to those markets.
There is a need to concentrate particularly on the agricultural sector in order to provide food and make that sector more self-sufficient. That sector has clearly been one of the major deficiencies for the people of Eastern Europe. There will also be immense difficulties as regards the most basic issues such as land ownership reform, mechanisation, agricultural expertise and even the distribution of food. People who have not been to Eastern Europe recently will have no idea of the immense difficulties which will arise.
The programmes that are envisaged will need considerable financing. They should be financed by contributions from OECD countries and not just from the European Community. The issue of how much should come out of the European Community budget has already arisen. That matter affects the Government in terms of how much the United Kingdom should contribute. However, I believe the European Community and the OECD countries should unite in contributing to the financing that is required.
Encouragingly, requests for assistance are being met positively and some trade and co-operation agreements have already been signed between Poland, Hungary and the EC. Requests are now already being received from the GDR, Bulgaria, Czechoslovakia, Romania and Yugoslavia. The European Community has wisely established certain conditions and certain undertakings that must be met regarding the rule of law, respect for human rights, the establishment of a multi-party system, the holding of free and fair elections in the course of 1990 and economic measures which will lead eventually to a free market economy before it signs agreements. That is a prudent and sensible consideration on the part of the European Community and reflects many of the views which have been expressed by your Lordships. The European Commission will monitor the progress of those conditions before any agreement is signed.
At this point I must remind your Lordships of the importance of the Council of Europe. I believe that is the only body that has not been mentioned so far in this debate. As one of its conditions of membership, that body requires ratification of the

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European Convention on Human Rights. That convention is controlled by the European Court of Human Rights. Many Eastern European countries have already requested observer status. I believe that one of the conditions of eventual closer membership within Western Europe would be membership of the Council of Europe as a guarantee of democracy and a democratic system.
However, the general needs of all these countries appear to be similar. They need a flow of external finance, technical assistance, technology transfer and training. The European Community has already set up an active and dynamic training programme. However, we must ask what the outcome of that programme may be. The Soviet Union, having now renounced economic and financial support for these countries through encouraging them to adopt democratic systems, has managed to transfer its former obligations, which it adopted at the end of the war, to the West. We must realise that in assessing the role we want to play in restoring and sustaining these countries.
While giving economic assistance, it may be wise to encourage these countries to retain some form of Comecon in order to benefit from their own mutual economic revival. They are, after all, at pretty well the same economic level that we in the West had attained after the war. That is an important aspect to remember when trying to encourage these countries to produce for themselves and for countries nearby. It will take several years for these countries to reach European Community economic standards and to consider the association agreements which could flow later on. Association agreements could lead in the distant future to membership of the European Community. However, that implies a considerable undertaking and obligations on the part of these countries. That at the moment is almost unimaginable. That is a long-term prospect.
I believe that I can summarise what I have been saying under approximately four headings. I do not believe it has been emphasised strongly enough yet that the shambolic effect of communism both as a political and an economic system on the lives of people must be recognised and never forgotten. While pictures have been shown of ecstatic crowds celebrating the lifting of the blanket of political oppression in Eastern Europe, very little has been shown of the derelict land, crumbling and decaying housing, appalling hospitals and the labour force there which is no longer willing to work because there is nothing to purchase with its wages. There is a complete lack, because of the system, of people who know anything at any level about accountancy, banking, communication and retailing. Those are all elements which contribute to a successful economy based on a capitalist system or a social market economy.
We had the honour of a visit from the President of Free Romania to the Palace of Westminster not long ago. He had just returned from Romania. He told us that Romania had precisely one television station and one newspaper. That is not a symbol of democracy. He had persuaded Mr. Iliescu, the acting president to introduce another television station and to provide a printing press and paper to publish
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another newspaper. Those are the kinds of difficulties that these countries are now experiencing and they show why they need our support.
In its support both for freedom and for prosperity the Commission must ensure that these countries are encouraged to embark on a system which will lead their people from poverty and decay to hope and success. While I do not seek to stress the comparative wealth and quality of life of citizens in the European Community, it must be emphasised that the multilateral treaty which binds our 12 member states together guarantees peace between us in an increasingly uncertain world. That was a point made by the noble Lord, Lord Cledwyn, as regards the role of the European Community and how over the past 40 years it has been unimaginable for countries in the West to go to war with each other. We cannot afford therefore to allow existing links to be weakened. On the contrary, I believe they have to be strengthened. I do not propose to discuss the kinds of constitutional problems which may arise, but the principle of the matter is that the European Community must not be weakened but strengthened.
Many noble Lords have mentioned the multilateral treaty, NATO, which binds Western European countries together in a defence system. That must remain the linchpin of our stability. With the uncertainty of events in Europe and within the Soviet Union it is now more necessary than ever to strengthen our links with the European Community and the United States. Reference was made to the proposal of the noble Lord, Lord Greenhill of Harrow, to have some kind of treaty. If there is to be a treaty at all, I would propose one between the European Community and the United States for defensive, political and economic reasons. Ultimately it is only from strength that we shall be ready to meet whatever eventuality may arise and in the meantime play our part in helping these countries to raise their standards of living and in giving them hope and prosperity.
4.59 p.m.
Lord Dacre of Glanton: My Lords, in the recent debate on German reunification the noble Lord who introduced it touched lightly, in summing up, on the timidity or hesitancy of historians in approaching that subject. We are, perhaps, a rather timorous breed. That is not because we are incapable of enthusiasm. I do not think anyone could have watched the series of revolutions that has appeared on television recently without emotion. That was the first time that one could watch revolutions happening before one's eyes. However, if we are slightly reserved in our attitude and we correct our emotions, it is because, by the nature of our profession, we have been there before. We have seen the euphoria of past revolutions followed, sometimes quite quickly, by disillusion and reaction, sometimes even by terror and war. We have seen 1789 followed by 1793; 1848 followed by 1851; and 1918 folowed by 1922.
In this context, I think particularly of 1918–19. At that time the Western allies liberated Eastern Europe. An extraordinary situation existed. Not only had our overt enemies, the central powers, been

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totally defeated, but so had our eastern ally, Russia. Then; was a complete power vacuum in Eastern Europe. In that vacuum, without perhaps knowing a great deal about the detail, animated by enthusiasm and some transatlantic encouragement, and believing that nationalism was per se a good thing, we were able to recreate a whole series of states: Poland and Lithuania, which had lost any trace of independence since the 1790s; Estonia and Latvia, which had never had an independent existence before; Bohemia and Moravia, which had lost their independence in 1620. Then we altered the frontiers of Romania and Bulgaria. We could do exactly what we wanted in Eastern Europe. We set up what we believed were liberal democracies in our own image.
That surely was a very good and liberal thing to do. Unfortunately the situation was entirely artificial. It was only possible because both Russia and Germany were totally defeated, prostrate and in revolution. They could do nothing to prevent it. Twenty years later we had relaxed in the comfort of our total victory. Germany and Russia had revived and had no difficulty in, between them, gobbling up all those states one after the other. We could do nothing. We could offer guarantees, but what were they worth? They led us into a war which we very nearly lost. That is a chastening thought and one which naturally occurred to me when I considered the subject.
The second time round we may be more successful. The situation now is slightly different. There are similarities, but no historical situation ever reproduces itself exactly. As a result of victory in the last war we reconstituted some of those states. We could not reconstitute the Baltic states because Russia had not collapsed. However, Russia has now collapsed and we are in the extraordinary situation of having everything that we wanted at the end of the war.
At the end of the war, in 1945, what did we want? We stated openly that we wanted a united Germany, provided it was non-communist, and provided it was shorn of the eastern provinces which we had agreed should go to Russia and Poland. We wanted the lesser states of Eastern Europe to be free again. We recognised that the Russians had what Sir Michael Howard calls a droit de regard towards them, but we did not want them to be communist, we wanted them to be independent. We wanted Poland to be independent and we wanted them all to be independent. But we recognised that they were within the Russian sphere of influence.
We lost that part of our peace settlement, such as it was in 1945. Now it has fallen into our hands. Russia has not been defeated in war, but it has collapsed and its empire in Eastern Europe has collapsed. So here we are with what we wanted in 1945, with Germany on the point of being reunited, non-communist and allied with us— a liberal democratic united Germany— and the states of Eastern Europe set free. We ought to be very pleased.
However, we have reservations. What are those reservations? We have reservations because we are not totally sure about Germany. When in 1945 we thought of a united, independent, free and democratic Germany we did not expect it to be
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as powerful as it is now. We did not expect the Wirtschaftswunder, the capacity to dominate Europe even when divided. Therefore we are a little alarmed at that. We ask ourselves whether it is possible that the old spirit might return. My noble friend Lord Brentford told a story to indicate that one person in Germany does indeed think that. I could cap that with stories of the Germans that I met in 1945 who thought differently. It depends on the company you keep.
Looking at the history of Germany as a whole in recent times, I am prepared to risk an opinion. I believe that there has been a fundamental change in German mentality since 1945. There was no such change in 1918. In 1918 the Germans did not believe that they had been fairly defeated. They had been, but they would not believe it. Their tradition, their historical attitude and the teaching in their schools, remained the same after 1918: the teaching of the old Wilhelmian German empire. It was preserved by the German elite in the universities and in the cooking of public documents which deceived us all. They deceived me when I was an undergraduate and read books which were written under false impressions derived from fudged documents published by the German Government under the title Die Grosse Politik der Europä ischen Mächte.
That is all over. It ended in the 1960s. I am prepared to argue this at length, but I am conscious of the time and shall not do so. I shall simply give noble Lords the benefit of my conclusion. It is that I believe that there has been a fundamental change in German historical attitudes, historical teaching and historical tradition. That is demonstrated in the famous Historikerstreit in Germany two or three years ago. Therefore, although I realise that I am taking a great risk, I am nevertheless prepared to take that risk. I am prepared to trust the Germans, in spite of the German my noble friend Lord Brentford met in 1945. So that reservation, in my view, does not now exist. Furthermore, powerful though it is, Germany is not as powerful in relation to other powers as it was in 1939.
We also have reservations about Russia. Anything can happen in Russia. I should not dare to make any prophecy about what might happen in Russia. Something disastrous may happen. A Bonaparte may take over if Gorbachev fails. However, at present, however delicate the balance may be, I believe that we can act— very provisionally, tentatively and timidly— on the basis of the information that we have. There is a situation in which, provided we are careful, we can watch and help the restoration and preservation of the kind of liberty which since 1918 we have wanted for those eastern states which lie between Russia and Germany.
There is one absolute condition which must be met. That is the preservation of the Oder-Neisse line. We must prevent the Russians from having a legitimate fear of a threat to their legitimate reason of state. That I believe can be secured by an absolute guarantee. We have the nearest that we can achieve to such a guarantee in the present circumstances in the form of Dr. Kohl's assurance on the Oder-Neisse line.

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What then do we want for the intermediate states which have been newly liberated from communism? I know what I want. Since it is so difficult to make any prediction or to calculate on the basis of events which are changing so rapidly at present, the best thing one can do is to look past the present events and the present means to the ends. What kind of a Europe do we want? I know the kind of Europe that I want. It is not a uniform, homogenised, Americanised Europe. Europe consists of a number of countries and those eastern countries— Poland, Bohemia and Romania among them— have a historic identity and traditions, and deserve to be allowed the right to keep and nourish them. Nor do I want Germany to be totally westernised according to the ideas of France and England. There is a great German intellectual, artistic and musical tradition which is appropriate to it. It is its own property which it should keep.
In General de Gaulle's phrase, I want a "Europe des patries". I should like those countries of Eastern Europe to stand on their own feet and to be independent. I do not want them to be a mere buffer zone or Russian colonies; but I do not want them to be western colonies either. I want them to stand on their own feet to nourish their own culture and to be proud of it and to be supported by us, not in the way that we have supported new governments in Africa and Latin America, by pouring out funds which have gone down the drain, but in the way that Marshall aid was used to support the shattered Europe after 1945.
I often think of a phrase by Gibbon. Gibbon describes the Europe of his time as:
"One great republic whose various inhabitants have attained almost the same level of politeness and cultivation",
and whose political diversity in history has been the chief condition of its constant improvement, thus differentiating it from the immobility and decay of the later Roman Empire. That is what I want for Europe and I want Eastern Europe to be part of it.
5.12 p.m.
Lord Moore of Wolvercote: My Lords, we had an excellent debate in January on the Motion of the noble Lord, Lord Callaghan, on the unification of Germany. Now, like other noble Lords, I am most grateful to the noble Lord, Lord Home, for giving us the opportunity of pursuing the theme with his Motion on the future of the countries of Eastern Europe and the Soviet Union.
In our last debate I expressed the hope that the smaller countries of Eastern Europe, sandwiched between the great powers of Russia and a unified Germany, would be allowed to work out their own salvation. Now, even before Germany has been reunited, we have seen signs of a threat to Poland's border. Fortunately, the West German Chancellor has been forced to retract his threat to the Oder-Neisse line, but a chill of apprehension will have passed through the Poles. Is it going to be the same story all over again?
The Poles are right to be apprehensive. International politics are basically concerned with power and everyone in Europe realises that power
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will lie increasingly with a united Germany. So it must be in Britain's interest to maintain a close and cordial relationship with the Germans. The prerequisite for that is that we should welcome German reunification without reservations, first, because it is right— the Germans are one nation— and, secondly, because it will happen anyway and all we do by being half-hearted is to lose the friendship of the Germans. They will not lightly forget those who cavilled and failed to give them full support at this dramatic moment in their history. However, if we support the Germans at this critical time, we shall be in a much better position to influence events in Eastern Europe. I have therefore been much reassured by the Prime Minister's comments on the East German election results and particularly by what the Minister has said this afternoon.
What kind of Eastern Europe do we want? First, we must hope for stability with no threats to the existing borders— not only the Polish borders, but all others in Eastern Europe. Secondly, we shall be looking for democratic forms of government— not an easy task, as other noble Lords have said, in countries with little experience of democracy. Thirdly, we want the smaller countries of Eastern Europe to flourish economically so that they can trade effectively with the European Community.
The integrity of the borders depends largely, but not entirely, on Russia and Germany and we must have good relations with both if we are to influence them at all. However, the problem lies not only with Germany and Russia. With the heady excitement of freedom, there is a danger that the smaller countries of Eastern Europe will become excessively nationalistic. It is of course to be expected that they should rejoice in their new-found freedom as independent nations and nationalism is bound initially to be prevalent.
In that situation, surely the European Community has an important part to play. We have been learning, rather painfully in Britain, that the extremes of old-fashioned nationalism have no part to play in the Europe of the 21st century. Perhaps, therefore, we should try to bring the countries of Eastern Europe into some kind of loose federal arrangement with the European Community. That will require a great deal of patient negotiation, but the Community must help the Eastern European countries to take the best advantage of the future that has so miraculously opened up ahead of them as a result of Mr. Gorbachev's dramatic changes in Russian policy.
It is on my second point— the development of democratic institutions— that Britain can make her most telling contribution. Our academics are greatly respected in Eastern Europe and it is heartening to know that already British constitutional experts have been invited to advise in Poland, Hungary and Czechoslovakia. The problems are immense. Most of the countries have no experience of democracy. For example, how does one explain that the chief executive of a local government council is a servant not of a political party but of the state and that he or she must give equally loyal service whichever

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party is in power? But the British know how to make such a system work and I believe that we really can help in that field.
Finally, we must seize whatever trade opportunities we can. The Germans will dominate economic development and we cannot hope to compete with them in heavy industry. However, there will be opportunities and openings for our industrialists and businessmen and I hope that the Department of Trade and Industry has already begun to identify the areas where we are most likely to succeed and where we should target our efforts. The Germans were already there yesterday. We must be there today and not wait for tomorrow.
This is a tremendously important development in the history of Europe. Let us please spare no effort to ensure that Britain plays a constructive and significant role in these great events.
5.19 p.m.
Lord Fanshawe of Richmond: My Lords, like other noble Lords, I welcome the initiative of my noble friend Lord Home in introducing this debate today in a remarkable and imaginative speech. I particularly want to intervene as I served my noble friend for four years as his deputy in the Foreign Office in the early 1970s. It is perhaps a somewhat doubtful claim to fame that I negotiated the exchange of diplomatic representation and ambassadors and signed the treaty between this country and the GDR in the early 1970s. Indeed, in 1972 I had the privilege of opening the British Mission in the Unter den Linden and stayed the first night there as a visiting Minister in the British residence in East Berlin. At that time little did I think, when the whole of Eastern Europe appeared to be frozen solid into a Communist regime, that the day would ever come when the events that we have seen over the past six months would take place.
I share the amazement of other noble Lords at the speed and swiftness of these dramatic developments. As noble Lords have mentioned, we now confront the fruits of our major success of a victory in the Cold War. However, there are some real dangers that have been indicated by Members on both sides of the House. One danger stems from the fact that all our Western eggs appear to be in a Gorbachev basket.
Why is that? We have no alternative. I do not think any of us would wish to see a reversion to the hostile regime that dominated Eastern Europe for 40 years. Nor do we wish to see a move to a strong military dictatorship, which might well be the alternative to the present leadership by President Gorbachev. We all hope that a stable society will develop in Eastern Europe and that President Gorbachev will achieve a similar solution in Russia. But we must recognise the difficulties that he faces in moving— we hope in due course— from a command economy to what is called a capitalist system, and also with the withdrawal of Soviet troops from Eastern Europe. It underlines the problems faced by President Gorbachev and the economy of the Soviet Union when most of the discussion between Eastern European countries and the Soviet Union regarding the withdrawal of troops concerns the difficulty that
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the Soviet Union will have in finding barracks to put them in. That shows the parlous state of the Soviet economy.
Another matter I wish to mention (I do not think it has been touched on by any other noble Lord) is the problem of new political parties. As we have seen, East Germany has produced Western style political parties, one of which, linked with the CDU in West Germany, has now taken over the government in East Germany. Another is linked with the SDP. On this side of the House we welcome the great victory on Sunday of the centre right grouping in East Germany.
However, when one looks deeper into the matter one soon discovers that that system may not spread throughout the rest of Eastern Europe. There is a tendency in Slav countries not to opt for a Western style party political system. For instance, in Yugoslavia, so long as there was strong and vigilant leadership, as existed for many years under President Tito, an extraordinary conglomeration of nations held together very firmly. But when Tito went, the country tended to split apart.
New parties in Slav states tend not to follow the Western style; they become nationalist parties. One finds nationalism springing up and the horrors of nationalistic attacks, as happened dramatically in the southern Soviet Union involving Azerbaijan and Armenia only a few weeks ago. Only today we read in the press of the drama that has been taking place over the past few days with the Hungarian minority in Romania. It is a matter of considerable concern.
New political parties are developing in the Baltic states because— as indicated by my noble friend Lord Dacre in a remarkable and interesting speech— they used to have democracies. These operated for only a short time— about 20 years; nevertheless democratic systems did operate. Romania has never had a democratic system. Certainly, Bulgaria has never had one and Yugoslavia has not had a proper one. So although East Germany, Czechoslovakia and even Hungary will produce democratic systems and parties in a Western style, which may function well, we shall have to watch carefully to see what happens in the Slav states. The dangers of fissiparous tendencies occurring in some Eastern European and Slav countries along the line of what is happening in the Soviet Union today must be very close to us.
I recognise that and I applaud, unlike the noble Lord, Lord Thomson of Monifieth, the Prime Minister's cautious approach which aims to achieve a proper framework for discussion of all these issues. When the whole of Eastern Europe is in flux, it is no good settling down in a chair and saying without thought and care, "This is marvellous. We shall now put together a new system and new arrangements in Europe". The Prime Minister's efforts to achieve a proper framework are already proving successful. After all, I understand that it was a British initiative which put together the two-plus-four discussions which will now take place over Germany, although I gather that the four are now moving to five because Poland is to be invited to come in and that the two are perhaps two no longer but one because East

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Germany, in the very near future, will be fully united with West Germany.
The other aspect of the Prime Minister's approach lies in her personal relationship with President Gorbachev. That personal relationship could prove to be a means of keeping the new united Germany anchored closely into NATO. I should like to see a development within the European Community and in NATO which, while preparing for a united Germany's economic domination of Europe (which I believe is probably inevitable) does not allow that new Germany to relapse into a pan-German nationalism.
Again, my noble friend Lord Dacre was most encouraging in the conclusions that he drew, based on history and great and wide knowledge of the developments in Germany over the past 40 or 50 years. He does not fear a revival of the type of Germany from which we suffered in the 1930s and 1940s. It is also worth pointing out that the Germany from which we suffered in the 1930s and 1940s was born in confusion, massive inflation, heavy unemployment and great misery. Today the Germanys at which we are looking are quite different. West Germany, which will dominate a united Germany, is prosperous and well run. It is in a totally different economic situation from the Germany of the time of the Weimar Republic in the 1920s.
It seems to me crucial during this period that we work closely with our friends in France. Perhaps not enough attention has been drawn to our old friend and ally, the French. We must recognise that inevitably France will pursue her own interests. She always has done and always will. We must also recognise that we should pursue our own interests. But in many areas we hold interests in common with our friends in France. We share the view that there should be a stable Polish frontier. We are opposed to the neutralism of Europe. We support the development of NATO. And both France and ourselves are nuclear powers.
Both countries consider that we need America and its continuing involvement in our Continent of Europe. We believe that the costs of German unity should not fall on the French or the British taxpayer. I hope that my noble friend the Minister will take account of that during the months ahead and in the negotiations on setting up the new Europe.
We also agree with our French friends that we need and will not isolate our German friends, keeping the new Germany in NATO and in the European Community. We must work closely with this Germany which is developing so rapidly day by day. Unification will certainly happen this year in my view, and Britain and France, within the constructive framework of the alliances of the European Community and NATO, will help to achieve a newly balanced Europe.
5.30 p.m.
Lord Gladwyn: My Lords, we must all sincerely congratulate the noble Lord, Lord Home, on
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choosing this date for the discussion of his Motion. After the recent elections it is clear that the unification of Germany will take place in the fairly near future though nobody can say exactly when or how. We can, however, now discuss intelligently what the general negotiating position of the West might be in the event of unification taking place or in certain prospect of its accomplishment.
There is no doubt that Chancellor Kohl has won a considerable victory by appealing to national emotions and by suggesting that the population of Eastern Germany would be better off under a free economy than under any form of socialism. Evidently this has made a deep impression, at any rate for the moment. However, what will happen during the next eight months or so before the Western German elections nobody can say for certain.
The West Germans will have in the first place to provide an immense sum of money before any definite deal can be struck; and the Eastern Germans may well have to put up with more hardships than they can at present imagine, notably as regards unemployment and in the loss for some time at any rate of certain elementary social benefits.
In any case the West will continue negotiating with Mr. Gorbachev, supposing that he remains in power. He has probably been taken as much by surprise by recent events as we have been. He thought no doubt that unification would take much longer and that it was probable that it would result in a Socialist victory. Now he has to contemplate the reverse. It seems likely, for instance, that the Germans after the next elections will opt for the maintenance of the Western alliance and for the consequent continuing presence of at any rate some American troops in Germany. This will be something which Mr. Gorbachev will now probably have to swallow if he wants to have any agreement at all.
What therefore can the West do to make it easier for Mr. Gorbachev to accept the West's proposals? I suggest that the first thing we could offer, apart from some general reduction in troops as a result of negotiations, is the Genscher plan for some kind of demilitarised zone in Eastern Germany. This might conceivably provide for no troops at all, or at any rate only a militia. It might also be agreed that the Russians, if they so desired, should maintain a token force of troops for the time being in, say, Brandenburg. Nevertheless, I repeat that Mr. Gorbachev would have to admit that German neutrality is simply not on the agenda.
The noble Viscount, Lord Eccles, has quoted Sir Michael Howard as saying:
"an Alliance without the United States would be an Alliance dominated by Germany".
I should like to finish the quotation from Sir Michael because I think it is intelligent. He says:
"The peoples of Central Europe and the Soviet Union, rightly or wrongly, would see this as a threat. Even the West European Allies would be uneasy; not so much because of the record of Wilhelmine and Nazi Germany as because of more deep-rooted instincts about the need for a balance of power in Europe. So long as these feelings are strongly held, there will be an equally strong need for the United States to remain entangled in the Alliance, to balance German as well as Soviet power. We may regret these sentiments but they inevitably exist".

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The noble Lord, Lord Dacre, may not agree but we must assume that what Sir Michael writes is correct: these fears exist.
Of course if Germany, perhaps under the Socialists at the end of the year, actually opts for neutrality there is nothing that we can do about it. A dangerous situation will in my view arise and we shall have to consider our action. The situation then would be not unlike that of early 1935. Nationalism would inevitably be the order of the day and we should have to consider the possibility of alliances.
There is another proposal that the West might conceivably make. That would be for a kind of cordon sanitaire in the East embracing the states of the old Austro-Hungarian empire and Poland, plus, possibly, the Baltic states if they should ever obtain real independence. These states should declare their intention not to have any foreign troops on their territory and should perhaps indicate also that Russia would, if necessary, be consulted about their defence policy generally. In other words, the Soviet Union, supposing that it continues to exist, should have a droit de regard over their defence policy. In this way there would be established a kind of equilibrium which is in practice necessary for the preservation of peace.
But there is another matter for consideration. It is the future of the European Community. Let us suppose that Germany is completely united, with Berlin as its capital. Can we assume that this huge new power will conform to any joint policy emanating from the machine in Brussels of which it will continue officially to be a party? We must hope so. I note, however, that M. Delors seems to be having certain doubts in that respect. We must surely do our best to ensure that Germany remains a member of what will essentially in the future be a political entity of some kind.
If Germany does not accept this obligation it means that the whole idea of a supra-national organisation in the west of Europe would collapse and not form, as it should, the basis, or core, of any great association comprising other states of Europe. What is certain is that some of these states cannot for a long time form part of the core. Nor would it be desirable in view of their proximity to the Soviet Union. On the other hand, they can and should have a fruitful and ever-increasing association with the EC, at least from the economic point of view. The same applies in a different degree to the neutral states of the European Free Trade Association— that is to say, the Scandinavian states other than Denmark plus (as I would think) Austria and Switzerland.
The short point is that the European Community, if it accepts the further development of the Single European Act at the conference planned for the end of the year, will surely advance towards that new kind of political community (not an old-fashioned federation) which Europeans in all the countries concerned have always envisaged. That is perfectly consonant with NATO for as long as it has existed.
If it does so advance then it will inevitably have to have a defence policy of some kind. Its one neutral member, Ireland, will not be able to stand in the
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way. Probably there will be some sort of merger with the WEU. Whether the Community advances in that general direction depends now on the attitude of a newly unified Germany, as well as that of our own country. But whereas that might be formed without Britain, its formation without Germany is frankly inconceivable.
To sum up, we now have to think out a policy in the light of recent events which on the face of it could best serve our own interests and favour the establishment of a lasting peace. The guiding principle of such a plan should be the emergence of some sort of equilibrium in Europe, without which the forces of international anarchy might prevail and without which I fear any mass meeting of the CSCE Helsinki Group might get bogged down in endless discussions.
Of course, no plan however perfect is guaranteed success. A united Germany might prove to be a rogue elephant. The Soviet Union might collapse in a series of frightful civil wars. Alternatively, there might be a military regime in that country which would seek to re-establish the empire by force of arms. However, if only in an attempt to avoid such disasters, we and our European colleagues should not delay in formulating some general plan, perhaps first in the two-plus-four negotiations. I hope that the Government will tonight give a clear indication that they are aware of the dangers and the best means of averting them.
5.43 p.m.
Lord Beloff: My Lords, my noble friend Lord Dacre has demonstrated that a professional historian need not be timid. However, some of us are timid, and I do not propose in my remarks either to venture to advise Her Majesty's Government— and in any event they do not often take my advice— or to prognosticate. That which came most powerfully from the speeches of my noble friend Lord Home and the noble Lord, Lord Cledwyn, and other noble Lords has been to point out how unexpected in themselves and unexpected in the pace have been the events which we have witnessed in the past few weeks, months and couple of years.
The fact that we have been caught by surprise and that events have taken place unexpectedly should be a caution that before we decide upon policy, certainly before we decide on any major changes in policy, we must be convinced that our analysis is correct.
In that respect I have only one difference with my noble friend Lord Home; that is, in the wording of his Motion, where Eastern Europe comes before the Soviet Union. It is a fact that nothing which has happened in Eastern Europe would have happened without the initial change in stance in the Soviet Union. It is not merely this year or last year that the countries in eastern and Central Europe have discovered a dislike for their oppressors. There have been tragic and dramatic events in many of those countries— the spring in Prague and the Hungarian uprising in 1956 and others of lesser moment— but we all know that what was happening was that deeply unpopular and inefficient regimes were maintained in power by Soviet strength.

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I shall come to the possible reasons for this, but once the Soviet Union in the person of Mr. Gorbachev had decided that those regimes should fall and that the Soviet Union could no longer accept the responsibility for keeping them in power, they went down like ninepins.
My noble friend Lord Dacre referred to the fact that we can now watch history taking place on television. We saw the embrace between Mr. Gorbachev and Mr. Honecker, and three days later word came from Moscow and Mr. Honecker now faces imprisonment or at least removal from the public sphere.
However, if we start, as the noble Lord, Lord Home, wished us to do, with Eastern Europe, I should like to make two general comments. In the first place, I am surprised at the degree of optimism expressed by the Minister and my noble friend Lady Elles about the current position in those countries. It is true that they have rid themselves of their oppressors, but it is not clear in many of those countries that there has been a total eradication of the Communist Party and its stranglehold on national life. We do not yet know to what extent that is happening or may happen, and clearly the extent is very different in different countries.
The Poles, whom one must congratulate, as other noble Lords have done, on the boldness of their economic initiatives, have had to take that action under the constraint of retaining a military force which is communist-led, and also under the constraint of fairly considerable participation by communists in the running of the country.
It seems to me that at the other extreme, in Romania, the revolution has not yet happened at all. The instance which the noble Baroness gave of the fact that until a week or so ago— and I do not know whether those promises have been fulfilled— there was a country with only one television station, one radio station and one newspaper, does not suggest that the old regime has given up.
Therefore, I believe that we are still likely to witness a great many more upheavals before we have a picture of the new Europe towards which we can frame policy. The noble Lord, Lord Fanshawe, referred— and I believe that so far he is the only noble Lord to refer to it— to the position in Yugoslavia. At any moment that may present us with seceding republics and with a possible attempt to suppress secession by force. Thus, there is a great deal still to worry about in the future.
Even if we assume that the revolution, if I can call it that, is complete we are not witnessing— and I think my noble friend Lord Dacre referred to this— a sudden efflorescence of western-style democracy. We are witnessing the recovery, as it were, of certain national and other characteristics which have always existed beneath the yoke of foreign domination, sometimes for decades, sometimes for centuries.
I think of Eastern and Central Europe today as one of those reservoirs in which, in a severe drought, the water recedes and suddenly drowned villages, churches and other evidences of the past occupation of the valley come to light. We see there all the
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traditional divisions which have marked Central and Eastern European history: the racial division between Slavs and Germans; between Magyars and Romanians. We see the religious divisions now penetrating through the possible upheavals of the Ukraine between Roman Catholicism and the orthodox church; in other parts of Europe between Catholics and Protestants.
These are parts of the scene which go back a very long way and which we must now take into account because they form part of the mass of new problems which we hope to be able to confront. Some of these apparitions are indeed deeply disturbing. Anti-Semitism— if I may take something which is naturally of very great concern to me— has clearly been revived even in countries where, thanks to the Nazis, the Jewish population is infinitesimal. There is a search for scapegoats in countries where their economic and social problems seem insurmountable.
When we consider the Soviet Union, again I find and have found for the past few years a considerable descrepancy between what I think is happening and what is usually talked about in everyday parlance. For instance, people talk about Mr. Gorbachev as though he were a sort of Father Christmas, coming along with an apple in one hand and an orange in the other; perestroika and glasnost. What in fact is the truth is that glasnost has made enormous progress, otherwise the shocks to his empire would not have occurred. Again the noble Lord, Lord Dacre, and others, and the noble Viscount, Lord Eccles, referred to the impact of communications, which has changed the world considerably even since 1918. This glasnost has made perestroika impossible. It is not possible to persuade a country, whose standards of living are not only low, but are falling— I have not found anyone who has recently been in the Soviet Union who does not confirm that— that merely tightening up the system, merely putting better managers in place, merely reshaping the ministries and reorganising the administrative side can itself alter their fate.
There is yet no evidence that the present Soviet leadership has gone beyond the scapegoat phase. They can blame Stalin. His statues can be pulled down; he can be removed from the history books and they can be rewritten. However, they still have Lenin on the pedestal behind them when they speak; they are still committed— Mr. Gorbachev made no secret of it— to what he now calls socialism rather than communism, but which, to use a neutral phrase, we can describe as a "command economy". Although we understand that he is receiving advice from his own people— foreign advice is unlikely to be welcomed there or indeed in many countries— that something far more radical is necessary, it is not at all clear that even if he takes that advice he will know how to proceed.
We have no experts in the dismantling of a command economy unless, as is likely to happen in East Germany, some Big Brother will come and do it. It is quite conceivable that with reasonable foreign assistance Poland, Hungary and Bohemia could perhaps escape from their command economies, could find in their situation— particularly perhaps in Poland which never nationalised agriculture— the

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embers of enterprise which could be blown into flames. However, it is highly unlikely that that can be done in the great parts of the Soviet Union, its most populated and potentially productive parts, the republics of Russia and the Ukraine. Stalin's principal legacy there was either to exterminate the peasant population or leave it with memories which make it highly reluctant to take up even the new opportunities through leasing or private ownership of land which the Soviet Government from time to time appear prepared to give them.
It is because that problem is insoluble that there will continue to be, whatever the outcome of the current crisis over the Baltic states, this attempt by the peripheral, the fringe republics to secede. They believe— they have examples before them to show it— that it is possible for small countries, if they are allowed to partake in the world flow of technology and trade, to do something which their Russian masters have been and look like being unable to do. One must therefore expect that a great deal of the energy of Mr. Gorbachev will need to continue to be directed towards what are relatively small areas of the country, a tiny fraction of the population even if you add to the Baltic states the Caucasus or Moldavia; he will have to divert effort to keep the country together. It is only if he appears to be successful in that that he will be allowed, if that is his intention, to continue a radical process of reform.
That fortifies the case made by various noble Lords for caution; for not assuming that we know enough to be able to intervene on a grand scale. There must be a degree of modesty in our aspirations. Above all, we ourselves must accept the lessons of glasnost.
A notable figure in the academic community concerned with international relations and foreign affairs remarked to me last night, "The trouble with running an institute is that there are now no experts". He meant that the whole focus of attention on Eastern Europe and the Soviet Union has been distorted for decades by the too-ready acceptance of falsified statistics, which only now are we beginning to treat at their true value.
Incidentally, I was rather surprised that the noble Baroness, Lady Elles, should have talked about the Soviet Union supporting these countries. The Soviet Union's influence on them has been almost wholly negative in an economic sense. It is these countries that have helped the Soviet Union. That is why these claims that are now made upon the Lithuanians seem— and must seem to anyone who looks seriously at the situation— very far-fetched. One has only to see the difference between the three Baltic republics and their near neighbour— in the case of Estonia, their linguistic equivalent the Finns— to see what happens if, either by luck or valour, one escapes from Soviet domination.
We ourselves therefore must get used to glasnost; to looking the facts in the face. The most dangerous aspect of all would be if we were to comfort ourselves with the idea that Eastern Europe, Central Europe and the Soviet Union are back on course to a better and a happier world. We may hope for it; we may pray for it, but we must not assume it.
6 p.m.
Lord Hankey: My Lords, we usually have a fascinating contribution from the noble Lord, Lord Beloff, and his speech on this occasion was certainly no exception. I agree with almost everything that he said. In spite of all the difficulties, I hope that we shall maintain altogether better relations with the Soviet Union under its new regime. The future peace of the world will probably, in the end, depend on that. We have begun well.
I agree with the noble Lord, Lord Beloff, that President Gorbachev has a formidable task ahead of him. I greatly hope that he will preserve such liberal and democratic principles as are contained in perestroika, but he will have major difficulties with growing nationalism in the USSR's constituent republics.
We have to resist any temptation to mess about in the internal affairs of Russia as Stalin messed about in ours. The overseas services of the BBC and, for that matter, the Voice of America, should be very careful not to appear to encourage breakaway tendencies and to show understanding for the position of both sides. It is a truly difficult situation. If we want really good relations with the new Russia, we have to be wise and restrained about Russia's internal affairs, though we should not be blind to what is going on and under no circumstances should we in any way forget our own democratic principles.
Changes take time and Mr. Gorbachev is going to need lots of that. A great deal will depend on Mr. Gorbachev's progress with the Soviet economy. He cannot easily change from a command economy to a market economy with an effective price mechanism while all the officials are trained in Marxism/Leninism. I suppose that is one reason why the Soviet Government have amended Article 6 of the constitution to remove the Communist Party's monopoly of power. Perhaps the local elections that have been taking place will also bring in some changes and introduce people who are less dyed-in-the-wool.
The need for a new economic system is, however, a vast problem in Russia and if Mr. Gorbachev cannot solve it I suppose there is a real danger of economic confusion or even collapse. If the Soviet economy fails to get food and goods on to the shelves in the shops and into the housewives' kitchens I doubt whether Mr. Gorbachev and perestroika can survive for long. But what would follow; another authoritarian regime? There are great uncertainties, and a number of your Lordships have said in this debate that we must watch the situation carefully and be prepared for all sorts of things to happen. Probably nothing good would come out of that. However, we must not forget the transcendent patriotism of the Russian people, which is a basic feature of their character.
To conclude my remarks about Russia, I am convinced that the future peace of the world depends on all of us in the West continuing to foster a new and altogether more friendly helpful relationship with Russia now that Stalinism is dead. It will require great restraint and continual wisdom. We have begun very well, in my opinion, and whatever happens, we

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should persist. For one thing, both the disarmament problem and the situation in Eastern Europe require friendly relations with the new regime in Russia.
That brings me to Eastern Europe. The economies of those countries are in a terrible mess, but the problem of changing from a command economy to a market economy is probably slightly less than exists in Russia. There must still be many people who remember conditions before 1939. I have the indelible impression from working in and with these countries that a great many people took Marxist/Leninist principles with a healthy dose of salt.
The basic regional economic problem is that trade is mostly on a bilateral basis. They have many restrictive quotas, and other measures, and they have no convertible currencies. After the war we too had this problem in Western Europe but we solved it with resounding success. The mechanism for doing so is still in place. The OECD has all the know-how, with expert committees on monetary and economic policies, on trade aspects, social aspects, agriculture, education and science etc. The OECD Economic Committee goes in detail, with sympathy and understanding, into the performance of every member country approximately once every two years. It gives invaluable and penetrating advice.
I believe, as the noble Baroness, Lady Elles, said, that that is what the Eastern European countries need. I urge seriously that they become members or associate members of the OECD and that the Economic Committee, in particular, should take them in hand. It would certainly give them many new ideas and much practical help.
I also urge that all members of the OECD and the European Community should only distribute our aid funds for Eastern Europe in proportion as these countries reform their economies, their currencies and their trade relationships. That is what we did in the 1950s in Western Europe. It took most of 10 years to set up the area economically and in my opinion it will take a little longer in Eastern Europe, but I have no doubt that that is the best way to do it.
Another reason for using OECD is that it includes among its members Scandinavia as well as the United States, Canada, Australia, New Zealand and Japan. We need to encourage the interest, advice and help of the whole developed world, especially North America, in what is going on in this crucial area. The noble Viscount, Lord Eccles, made an extremely good point about the importance of keeping American interest. We must not forget that the League of Nations failed because it was too restricted and because the Americans were not in it.
I now offer a serious warning, having worked in and with these countries for years. They tend to hate each other. The disgraceful treatment of the Hungarian minority in Romania which sparked the Romanian revolution is typical. The disturbances in Kosovo with the Albanian minority are not much better. We must remember that the First World War was sparked by the murder of an Austrian archduke
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in Serbia and that the Second World War began in Danzig, now Gdansk.
Democratic peoples and leaders may not always be much wiser than dictators, and now that there is no Pax Sovietica across the area of Eastern Europe we must have a really good and powerful organisation to keep everything in good order and arrange the settlement of disputes. The League of Nations was constantly occupied with disputes in the area. At every meeting there was at least one, and often two or three disputes of this sort. I seriously wonder whether a development of the Helsinki Accord on Security and Co-operation in Europe could be arranged. The noble Lord, Lord Callaghan, made a very strong point in that regard on 17th January and several speakers in this debate have also mentioned the point.
We must beware of sparks in Eastern Europe. Perhaps the Helsinki Accord could be developed. I believe the noble Lord, Lord Brabazon of Tara, said that the Government were examining that possibility. I hope that they will go on with the idea.
Finally, I come to Germany's relationship with all this. I suppose that Germany will definitely be reunited in the next 12 months. Obviously, there must be an agreed solution for the future of the Soviet troops in Eastern Germany. That is a real task for diplomacy. I wish to repeat insistently, as many of your Lordships have done, that Germany must remain in NATO. The Germans want it; the Eastern Europeans want it; we want it, and we must not accept any argument about it.
At the same time I hope that good direct relationships can be promoted between NATO and what is left of the Soviet pact. I suppose that is only the Soviet Union. It is essential that in future both sides should come to have some real confidence in each other. We have made a good beginning and we are moving in that direction. Dr. Woerner, the Secretary General of NATO, has excellent ideas on all this. I was very impressed with him. It is essential in NATO matters, if we are to have good relations with Russia, that both sides should adopt a stance which is transparently defensive and in which both sides can have confidence. Whatever happens at the next election here, in no circumstances should we go for any unilateral disarmament. That would be a most disturbing factor in the preservation of peace.
Especially, we must not be bamboozled about what is happening. We must have a system of control of disarmament measures in which we can have proper confidence. No one can foresee what is going to happen in Russia or who will take the lead if perestroika and Mr. Gorbachev fail. There might be a national leader looking for an adventure with whipped up patriotism to solve internal problems. We should make Europe so strong, so cohesive, so well-organised in defence and other matters, that no one will ever be tempted to do that, but still preserve good relations with Russia.
Please do not be under any illusion at all but that we need to have the new Germany in a strong, politically-conscious and well-organised European community. It is really essential that Britain should be an active participant on the inside network. We

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have made great errors in not working more actively to promote this vital new development. Now is the time to do that while everything is in a state of flux.
My noble friend Lord Greenhill, in a transcendently good speech, suggested that we should take our time about the matter and not hurry. I think we have to do something before the cement hardens. Once that has happened, and the situation is no longer in a state of flux, we shall probably not get further forward. It is essential that Britain should be an active participant on the inside network.
All through the centuries British policy has aimed to prevent any one power controlling all the coasts opposite our shores. However, the countries of Europe are now consolidating and it is vital for all of us and for world peace to keep the new, reunited and democratic Germany in a good, profitable and friendly framework. I am sure that we cannot accept a strongly centralised system in the new Europe. It would cause prodigious aggravation. I do not believe that the Germans can accept it either. We shall still have to decide a great number of things for ourselves.
On 17th January I said in this House that I seriously thought that, as a long term objective, we should all start working towards a confederal government for Europe. I know that that is a horrifying idea to a lot of people, but it is time that we began to think seriously ahead. The member countries would assign to the confederal government only the powers that they want it to exercise and they would keep the rest for themselves. There would have to be a treaty with a written constitution. I am as conscious as any noble Lord of the vast difficulty of doing this. Obviously, one can "suggest a problem for every solution", as my French colleague once said at OECD.
After our terrible experiences in Europe over the past 150 years, we would be very wrong to fail now to pull Europe together. There is an old and wise American political statement, which is:
"If you can't beat them, join them".
6.15 p.m.
Lord Belhaven and Stenton: My Lords, like other noble Lords who have spoken, I wish to thank my noble friend Lord Home for initiating the debate and for allowing us to speak on this very wide subject. My only intention is to draw your Lordships' attention to the situation of Poland. In this respect I have to declare an interest, as I have done before. I do not know how many times I have to do so. My wife is Polish. Beyond that, possibly the whole House and the whole nation should declare an interest in the matter of Poland.
I do not believe that any country in the world suffered more in the Second World War than Poland. She entered 1945 with her capital in ruins and with more than half of the population dead, the other half having had to flee. Nearly all the major cities were also in ruins. Those of us who are old enough— probably most noble Lords here this evening— remember the gallantry of the Polish servicemen who came here and fought on our side. Sometimes perhaps we forget that they were fighting for their own country as well as the general cause.
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The price that Poland paid for steadfastness in the war was the loss of 52 per cent. of her national territory and the suppression by her major allies of her legal government; so, in 1945, there was no one to speak for Poland except the carpetbaggers and bandits installed in office by Stalin. The activities of the successors of the Stalinist Government are responsible for the plight of Poland today— hyperinflation, overwhelming environmental pollution, bad roads, hopeless telephones (as I have experienced to my distress) and other factors too numerous to mention.
It must be almost unprecedented in history for a country on the winning side in a major war to be so penalised. As compensation for the loss of 52 per cent. of her territory, Poland was given a large part of East Prussia and the former German territories east of the Oder-Neisse line. It is appropriate to remind your Lordships that Poland had no say in the readjustment of her frontiers. They were imposed on her. Indeed, at the end of the war, she was treated in almost every way as a defeated nation: her territories forfeited, her frontiers rearranged and, worse than all that, the gallant men and women who fought in the Polish Home Army were rounded up. Some were murdered and some, like my father-in-law, survived imprisonment and persecution to try to make a living in a country with a system which they hardly recognised as their own.
On top of that, many, if not most, of the servicemen who had fought side by side with us in the West, in the Battle of Britain, at Tobruk, Monte Cassino and in innumerable other battles, were unable to go home for fear of imprisonment or judicial murder. What a bitter shame and injustice all this was!
I am very happy to take note of the fact that Her Majesty's Government are standing firm in their support of the Oder-Neisse line. The least that the victorious powers can do is to guarantee absolutely that this frontier is not changed. It has been made clear to the united Germany, should it come about, that it will not be permitted to fish in those waters. I do not believe that any of us wish anything but happiness and prosperity to the new Germany. However, it should be made quite clear, particularly in view of the carryings-on of Chancellor Kohl in the past few weeks, that, no matter what the claims and counter-claims may be between Germany and Poland over Pomerania, Silesia, East Prussia and the rest, the loss of territory is the price which Germany must pay for the hell she has let loose on Europe twice in this century. This also goes for the Sudetenland, Alsace Lorraine and the rest. I believe that these questions ought never to be re-opened. I have seen them being re-opened on our television screens very recently. Germany is perfectly able to prosper within her present frontiers and in fact is doing a good deal better than most of her neighbours.
I shall not go into the various ways in which we as a nation can help Poland in her present predicament. That has been more amply covered by noble Lords who have already spoken. However, for us, Poland should be special case. She proved herself to be the staunchest of allies in the war and many in this country have the closest ties of friendship and family

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with Polish people. Through the terrible period between the betrayal of Yalta and today the Polish nation has never waivered in its dedication to Christianity and freedom. The Solidarity movement was a precursor and standard bearer of the great liberation which has now swept over the whole of Eastern Europe including Russia itself. We and all free people owe Poland an incalculable debt. This time, my Lords, I believe we ought to pay it.
6.21 p.m.
Lord Parry: My Lords, it is probably 15 years since I was in Hungary as part of a parliamentary delegation. Since then I have been to Czechoslovakia, East Germany and Yugoslavia. But I know very little of any of those countries except as a tourist in what were for me underprivileged lands.
It is a fact that this afternoon the whole lives of most of us in your Lordships' House have been under review. The debate has taken us from 1945 through to the present day. The moment in 1945 when the war was over, the Cold War was beginning, the Iron Curtain was sliding down, the Bamboo Curtain was going up and the foundations of the Berlin Wall were being laid in the divided capital of Germany, was the moment when most of us began to take a part in public life in Britain. Many much younger who are present will know it only from their history books. Some present in the House were already recognised figures in the public life of Britain. It is a miracle that they are here tonight.
It is a delight to pay tribute to the noble Lord, Lord Home, who launched this debate, and to my noble friend Lord Cledwyn who followed him, for having set the trend of it and for giving us what has been, despite our different politics, an almost ecumenical approach to the revolution in human history now taking place in Europe.
The Hungarians, who have a wry sense of humour, taught me a proverb. There was, they said, only one difference between the optimist and the pessimist: the pessimist was better informed. We have had a well-informed debate which has vied between optimism and pessimism and yet has sketched the true facts of what is happening in the lives of people on the other side of the world. It is quite incredible to me that at the time when all those divisive, difficult and so saddening things were happening immediately after the world war, the then Foreign Secretary of Great Britain, Ernest Bevin, was still able to say that his foreign policy was to look forward to the day when he could go down to his local railway station and buy a ticket to anywhere in the world.
Because there is an excellent Library in your Lordships' House I am able to quote what Ernest Bevin said in his own inimitable style in an interview in the Spectator on 20th April 1951. He said:
"My [foreign] policy is to be able to take a ticket at Victoria Station and go anywhere I damn well please".
It was typical of Ernie Bevin that he should use a truculent expression to underline something deeply fundamental which has been understated, I believe accidentally, in your Lordships' debate.
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For many people freedom is the freedom of travel. The only reason why the walls went up in the first place and the curtains came down in the first place is that people wished to travel. Human beings are the most restless of the creatures of this earth. They are compelled to climb the highest mountains; they want to go down the deepest caves; they want to swim the rivers and sail the seas; and they want to go to other people's lands to see what happens there. When systems limit that fundamental drive of human nature they are at the same time defeating themselves and frustrating one of the greatest powers in human life itself. It is a fact that the wall did not frustrate the wish of the people to travel. It only increased it. When the wall came down, it came down for the same reason that it went up. The attempt by Erich Honecker to hold in the people who were leaving his disliked system was doomed to failure.
On 12th May 1949 there was a debate in another place— what I always call the Commons— on the setting up of NATO. I do not think that any noble Lord present actually spoke in the debate. Naturally those who did are probably long dead. There may be some who voted or abstained from voting on that issue. The setting up of NATO is fundamental to what we have been discussing today. It is a matter for human optimism that the people who were associated with that are able to look out on the world in the 1990s and know that their worst fears were never realised and that some of their brightest hopes may be attainable.
I pay tribute to all those who have spoken in the debate. Some noble Lords are inevitably still stuck in the vocabulary of the earlier stages of the Cold War. The moving speech of the noble Lord, Lord Belhaven and Stenton, is as much appreciated as any other speech this afternoon. My noble friend Lord Kagan spoke as one who was behind the barbed wire, was in the prison camp and suffered in his youth. We listened with even greater attention to what was a remarkable, short speech.
There are, as noble Lords have pointed out, question marks over this whole issue. This very day, with the first democratic elections of their lifetimes out of the way, with the euphoria naturally dying, the people of East Germany may well be asking themselves how much freedom have they won. If one of the freedoms they were looking for is the freedom to travel, they have heard their potential Chancellor appealing to East Germans not to travel but to stay where they are.
The de facto coalition between West Germany and East Germany could take place in a fortnight. It may well take a year to realise all the changes that will follow from it, but within a fortnight we could have an effective coalition of interests between East and West Germany. Yet today, a few days after the election that won them their freedom, Chancellor Helmut Kohl is appealing to East Germans not to travel. Their own leader, Herr de Maiziere, who has been elected as Prime Minister, is saying from his side of the fence that the people should stay and should not bleed their country to death by leaving. The death of any council, of any community or of any country comes when its best people move away because they are disillusioned.

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As some noble Lords have said, it is true that Marxism and Leninism, and Marx and Lenin themselves, have long been discounted even in the countries that were still running communist systems. But these people who have had their politics forged on the anvil of world anger, and at the same time by the ideologies of Marx and Engels and others, know that Hegel, who was one of the people from whom Marx learnt some of his disciplines, actually traced the decline of the society which they see happening at this time. He said that there were traceable steps, but that first of all there was disillusion of the people in the system under which they lived. Following that disillusion there came inevitably decay and out of decay there came collapse. Then— and this is the significant thing that no one has mentioned in the debate— out of the collapse there would always emerge a new ideal which was always the antithesis of the ideal that it replaced. Therefore we have seen once again on the face of history the repetition of those Hegelian steps.
In the few moments I have left perhaps I may sketch in another aspect which has been totally omitted from the debate. Why, I wonder, did Mikhail Gorbachev, in power in what is still one of the great powers of the world, suddenly find himself yearning for his European home nostalgically? I shall tell your Lordships why. He did so for the same reason that the great British empire began to break up after the war. In Burma, in Ceylon and in the countries of the Far East the great British Empire realised that it could not hold down any longer people in areas and parts of the world who wished to be free and make their own determination. Therefore we retracted our empire and today we have achieved the role that we have in the world. It is one of which we can be proud. We need not apologise for much of our history. But when Mikhail Gorbachev found himself in Afghanistan which was supported by money and funds and fighting forces from Pakistan and when he found himself faced with the Mujahideen peasant who was doing incredibly well againt modern weapons, he and his armies recoiled. However, let us remember that his government is still in place. I heard people say in this House that the Government of Afghanistan would fall within a week, and good riddance to it. But it is still there.
All along the Eastern Soviets Mikhail Gorbachev has a Moslem population; indeed, in some cases 75 per cent. of the people are Moslem. They are not turning towards their European home; they are turning towards their spiritual home and to their Moslem beliefs. Moreover, many of them are Shi'ite Moslems. Mikhail Gorbachev realised that unless he retracted and shook off some of the responsibilities and expenses of his empire, he would find himself reduced to struggling against forces that were not containable. It is, however, too late to go into the details of the situation.
I must say that I am honoured to be a part of this debate. I believe that we can be optimistic. But we should not discount the fact that there is a third dimension beyond the Urals and that we could see a whole new empire; for example, a Shi'ite Moslem or a Moslem empire stretching from Pakistan to the Mediterranean and sitting on many of the oil
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reserves of the word. This is a point I make in closing because I was moved, as was the House, by the perorations of my noble friend Lord Cledwyn in his remarkable speech. He talked of the dream that sustained people during the world war. I remember that it was Bernard Shaw who wrote some words that Robert Kennedy purloined— some young men do such things— without attribution. He ended the book of his ambitions and hopes for the world with these words:
"Some men speak of things that are and say why: I dream of things that never were and ask why not?"
That is also my attitude.
6.34 p.m.
Baroness Strange: My Lords, I, too, am grateful to my noble friend Lord Home for initiating this most timely debate. I am also most grateful to him and to the noble Lord, Lord Cledwyn, for their very moving speeches. Because I lost my dog last weekend, and found her again after two days, I find myself thinking very much in terms of dogs. That is why, rising to speak in such company, I feel rather like a dachshund getting up among a pride of great danes. But I know from experience about your Lordships' kindness and tolerance and that emboldens me.
We are not only living in interesting times, we are also living in a European kaleidoscope at a moment when the whole pattern is changing. From the earliest Bronze Age with its settlements of long-headed fair Nordic and dark Mediterranean types, and the round-headed Alpine, who were largely farmers and peasants, frequent disruptions occurred when the wild Indo-Aryan warriors with their sharp, vertical swords disrupted the peaceful peasant cycles of spring and harvest, planting and reaping.
Europe as we first know it came with the Roman Empire, based around Rome and enveloping the shores of the Mediterranean, although it also included Britain— at least as far as the Antonine Wall. Anyone who was not Roman, or possibly Greek, was a barbarian. But suddenly, with one of the periodic disruptions of the kaleidoscope, the Huns swept down from Mongolia into Dacia, pushing the Visigoths into Italy, and in 410 AD Alaric and the Visigoths sacked Rome. The pattern of Europe had changed, now peopled by Visigoths in Spain and South-Western France, Franks in the North of France, Burgundians in the middle, and all of Austria and Italy filled with Ostrogoths. With the collapse of Roman society over there the Britons fled into Wales and Cornwall and the Angles, Saxons and Jutes descended upon England.
The next great kaleidoscope change was under Charlemagne, Emperor of the Franks, who extended his empire west into Saxony, Bohemia and Bavaria and south into Lombardy in Northern Italy. At his death in 843 AD his vast empire split vertically into three among his three sons— an early French partagement. Europe has once more dissolved into a kaleidoscope of small pieces. This was when it coalesced into the Holy Roman Empire under Otto of Saxony who, with his father, had driven back the wild Magyars. Marching to Rome in 962 AD he was

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made Holy Roman Emperor, with an empire, which although with changing amoeba-like frontiers, remained a constant force for the next 900 years.
By 1360 Europe was much more as we know it now, with Russia and the two large kingdoms of Lithuania and Hungary in the East, a smaller Poland, Portugal, Castille and Aragon in the Iberian Peninsula, the whole of Aquitaine owned by England, and the Turkish Ottoman Empire creeping up into Bulgaria and Serbia in the South-East. Finland was part of Sweden, but Norway and Denmark very much retained their geographical entities as they are today; as, indeed, did Switzerland.
The Turks were driven back from the walls of Vienna— when the inhabitants celebrated by eating croissants, the Turkish crescent moon symbol— the Moors were driven out of Spain and Europe settled itself into a more comfortable pattern. France emerged as a whole nation; Poland grew larger until in the 18th century it was partitioned between Russia, Prussia and Austria. Napoleon created the French Empire, parcelling out kingdoms to his friends and noble kinsmen.
With the Congress of Vienna in 1815 Europe again changed. Italy united. We in Britain did too, and although we lost our continental possessions— except for the Channel Islands— we expanded gradually overseas into the British Empire. France and Germany, Spain and Portugal and Belgium and Holland all stretched outwards beyond Europe to found empires of their own. The Holy Roman Empire collapsed. Frederick the Great and later Bismarck reunited Germany under the eagle of Prussia, and this eventually led to the 1914–1918 War and another kaleidoscope change.
In 1918 parts of Germany and Austria went to Poland, as well as parts of Russia. Estonia, Latvia and Lithuania were established or re-established out of Russia. Parts of Austria fell to Romania. Yugoslavia and Czechoslovakia were created out of Serbia and Croatia, and Bohemia and Moravia. Thirty years later, with the rise of Hitler and the Nazis, it was all up for grabs again by the Germans. After 1945 the Iron Curtain of communism clanged down over the eastern half of Europe.
A new Europe is once again emerging: a Europe in which there are three factors which need careful consideration. First, there is the outbreak of glasnost and perestroika in the Soviet Union, and from this all the other changes which have arisen. Secondly, there is the break-up of communism in the Eastern European nations and their move towards democracy; and, thirdly, there is the unification of Germany. The kaleidoscope is still settling, the new pattern still emerging. We are all observers of this change, but today, as many noble Lords have mentioned communications are almost instant, distance no longer counts. You can see the breakdown of the Berlin Wall on your television as it actually happens.
We in Britain must be ready wholeheartedly to help the emerging countries of Eastern Europe to achieve democracy, to stake our own place in the kaleidoscope. We must, with cautious friendship,
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welcome the re-emergence of Germany. And we must continue our friendly dialogue with the Soviet Union, which is emerging from a chrysalis, and like all emergent imagos is at its most vulnerable state. So we must extend our friendship and our help without ever relaxing our vigilance over our own defences.
The new emergent Europe is, as the Soviet delegate Mr. Medvedev said here a few weeks ago, our common home. We must not limit our conception to a smaller Europe, only the 12 based on Brussels, but to a larger Europe perhaps even including America, as the noble Viscount, Lord Eccles, and my noble kinsman and clan chief suggested. Neither must we let ourselves lie open to any sudden and unexpected chill winds which might blow from the East. We have much to be proud of in the British Empire. We have also much to give to the new Europe.
6.42 p.m.
Lord Bonham-Carter: My Lords, I too, like other noble Lords, should like to say how grateful we are to the noble Lord, Lord Home of the Hirsel, for initiating this debate. I find myself in some difficulty in following the noble Baroness in her speech, as I last read Bryce's History of the Holy Roman Empire when I was 14. It would have been more appropriate if the noble Lord, Lord Dacre, had followed her rather than me. But I, like other noble Lords, in the past few weeks and years have been overwhelmed, bemused, almost drowned by the cataract of events, one succeeding the other, in the past two years, the past two weeks, the most recent of which would have satisfied one's hunger for news for many months in the past.
To mention but four events: the Communist Party's monopoly of power in Russia having been abandoned; the increased powers granted to the President of Russia, Mr. Gorbachev; the talks about Lithuanian independence between Russia and Lithuania; and finally, and by no means least, the German elections. Each of those events is in its way momentous. Each would justify a debate in its own right. Therefore it is not surprising that the debate we have had today in your Lordships' House has covered a wide field and opened up a large number of different options.
I should like to say that I found myself in some agreement with many of the pessimistic prognostications made by the noble Lord, Lord Beloff, when he spoke earlier this evening. If one looks at the prospects facing Poland today one sees that they are genuinely daunting. Here you have a country of 35 million people, rich potentially in agriculture but now importing food; rich potentially in raw materials but nonetheless with probably the lowest standard of living in Central Europe.
Here you have a government based on a trade union movement which is asking its followers, and the people who elected it in a curious way, to accept inflation that is running at 20 per cent. a month, unemployment that will probably rise to from half a million to 1 million in the next month or two according to your adviser, price rises of 20 per cent.

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in January, and a real drop in the standard of living. The rigours that the government are asking people to put up with in the expectation of better things to come are such that most electorates would not entertain them. There will be local elections in Poland in June, and it will be interesting to see how they respond. If they respond favourably it will be an enormous tribute to their determination, their courage, and their patriotism.
If on the other hand you look at Romania you have a situation which, if the information I receive is correct, is far more grisly and worrying. Romania has a tradition, and it is a tradition of bad and corrupt government. It would be surprising therefore if at one stride it leapt into democratic reform successfully.
I am informed— and I do not know whether I am right or wrong, but it is on reasonably good authority— that the elections which are about to take place in May should be monitored by some external, neutral body; that intimidation is rife; that the opposition parties are given 10 minutes a week each on television; that all party leaflets, information and so on has to be printed by the central government press; and that when— and this I cannot vouch for, it is simply what I am told— a printing press was given to one of those parties, they were told that they had to hand it over to the National Council for Salvation so that it could be shared "equally" among the parties.
It seems to me that this is a serious situation, and I suspect that it is not an uncommon situation in Eastern Europe. In discussing what we are discussing today, we need to distinguish not only between the USSR, which is a totally different situation from that in Eastern and Central Europe, but between Central Europe— by which I mean Poland, Hungary and Czechoslovakia; basically the old Austro-Hungarian empire, or parts of it— and Eastern Europe which is, as the noble Lord, Lord Beloff, said, mainly orthodox in faith and which has a totally different history and a largely different structure.
Nonetheless, though one may look with scepticism and some degree of gloom at the prospects that face people in that part of the world, one has to try to look at the situation with the optimism that has informed some of the speeches we have heard tonight, and not least the speech of the noble Lord, Lord Home. Just as it seems to me that in World War Two, when we reached the stage that Mr. Churchill called 'The end of the beginning", people started to ask for war aims, so now it seems to me, amid the welter of events and revolutions that we have witnessed, there is a need for what President Bush rather charmingly called "that vision thing".
In thinking about "that vision thing" we can be powerfully assisted by two lectures recently given in London; one that has been extensively quoted tonight Sir Michael Howard's Alastair Buchan Memorial Lecture, and also Sir Ralph Dahrendorf's Sir Brandon Rhys Williams lecture. I shall be referring to them in the course of what I have to say. I start, as Sir Michael Howard starts, from the assumption I think shared by most people but if
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one took seriously some of the answers we get to questions on defence in this House from Her Majesty's Government, one would think that they did not share— in Sir Michael Howard's words: that Gorbachev has already achieved his historic task of setting on foot a transformation of the Soviet state that is both open-ended and irreversible. If you start from that assumption you can try and think of a more optimistic scenario than that outlined by the noble Lord, Lord Beloff.
Although it is true that the USSR remains a nuclear superpower, I think that the word "superpower" cannot be applied to her in any other respect, neither economically nor politically. In saying that, and making that assumption, I am not denying that the changes that we are witnessing carry with them dangers; that, as it were, melting snow can cause avalanches; that the new freedoms won in Central and Eastern Europe may lead to outbursts of nationalism and to the revival of ancient disputes.
Nonetheless we have an opportunity that is a rare and extraordinary one, and that is to take a part in remaking Europe. That is what the "vision thing" is about. If one looks at the kind of vision that one has of Europe, or what the noble Lord, Lord Dacre, described as "the Europe I should like to see", it is a vision of a single security system embracing the whole of Europe from the Atlantic to the USSR borders. It is a Europe in which the existing military pacts are dissolved. It is an integration of Europe, either within or in association with the European Community, of EFTA with which it is already in negotiations; and of a Central Europe consisting of those countries which President Havel, who is here this week, suggested should associate more closely with each other— Poland, Hungary and Czechoslovakia. That would provide a unit with which the European Community could negotiate as it developed.
However, we must remember, as a number of noble Lords have said, the legitimate anxieties of Russia. In order to assuage and allay these, Sir Michael, in his lecture, as was mentioned by my noble friend Lord Gladwyn, suggested that one means of so doing would be to have a demilitarised zone stretching from Finland to Yugoslavia in which no foreign troops and a minimum of national troops were allowed to be stationed.
It may well be easy to draw pictures of that kind. What is much more difficult— and what we must address ourselves to— is how we get there. In this post-Communist world, the two great dangers that face us, it seems to me, are fundamentalism on the one hand, and nationalism on the other. Within Europe it seems that the latter is the most dangerous. One manifestation of nationalism against which I think we need to guard is a narrow defence of national sovereignty. That is a term which means less and less in economic, environmental or military affairs in the world in which we live and must survive. The concept of national sovereignty is an obstacle to building the kind of Europe which I have described and which, if clung to by British governments, will minimise our influence in the councils of Europe and of the world.

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Hence I entirely agree with what my noble friend Lord Thomson of Monifieth and the noble Baroness Lady Elles said, in emphasising the importance at this moment of deepening the political and economic institutions of the European Community. The events in Germany, the prospect of German unification in the immediate future make that more not less important.
As the noble Lord, Lord Cledwyn, said, it was in the light of this prospect that the European Community was invented. It was in the light of that prospect that the United Kingdom was asked to take part in the original talks at Messina. Now that it is happening, it is all the more important that we cease to be what Sir Leon Brittan has described as a "semi-detached member" and become an active and fully participating member.
As Sir Ralf Dahrendorf said in his lecture, we can either be bystanders, in which case we shall probably become the satellite of some great power, or we can become active participants in the whole process. In such circumstances with us fully involved in a Europe which is growing politically and economically, I do not recognise, any more than my noble friend Lord Thomson, the threat posed by a united Germany. I am much encouraged to be reinforced in this view by the words of the noble Lord, Lord Dacre.
Of course a neutral Germany, a kind of shifting cargo in the centre of Europe, would pose a real danger. But a Germany within the European Community and within NATO does not alarm me. Nor, it appears, does it alarm any members of the Warsaw Treaty Organisation, with the exception of the USSR. It is our duty to try to persuade the USSR that a Germany within NATO and within the European Community is the safest option. That does not mean that in the future NATO will remain the same or remain unchanged. The alliance will remain just as the Atlantic alliance must remain, but the balance within the alliance will change. As it has changed in the past, so it will change in the future.
It is here that I felt in some disagreement with the emphasis of the speeches of the noble Viscount, Lord Eccles, and the noble Earl, Lord Perth, with their reiterated emphasis on the relationship with the United States of America. The "special relationship"— if that is what they were referring to— seems to me to be a thing of the past. Its death seems to me to have been pronounced at Suez. If the United States has a special relationship with any European power today, it is quite clearly with Germany. It is said that President Bush refers not to the "German problem", but to the "British problem". Moreover, the United States has urged in the past and still today urges this country to adopt a more forward position within the European Community. The two relationships— that is our relationship within the Community and our relationship with the United States— are not alternatives, they are complementary.
At the same time we must expect further troop withdrawals by the United States from this Continent. We must expect the United States to concentrate rather more on the Pacific rim than
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it has hitherto and rather less on the European dimension. Hence I agree with Sir Michael Howard when in his lecture he said that:
"the balance within the Alliance must now shift. Under the new circumstances the European members of the Atlantic Community can and must make proportionately a far larger contribution to their own security. The role of the United States should in future be supportive rather than dominant. NATO must not be seen in the future, as it has been too often seen in the past, as a mere extension of American power".
Those sentiments seem to me well judged.
Finally, every one of your Lordships who has spoken in the debate has referred to the fluidity and unpredictability of the situation in which we live. Every one of them has pointed out quite rightly that while this instability carries the prospect of development in a positive way, it also carries with it dangers. I believe that in this Europe of flux, change, opportunity and danger, a European Community in which we play a full part can provide in this changing situation a zone of stability.
6.57 p.m.
Lord Graham of Edmonton: My Lords, I wish to begin by echoing the words of my noble friend Lord Cledwyn and joining in the grateful thanks from these Benches for the generous tributes that were paid to our dear departed colleague Michael Stewart. It is typical of the debate and of the generosity and warmth of the House to a colleague who served the House and the nation well.
Not for the first, nor I hope for the last time, the House is in the debt of the noble Lord, Lord Home of the Hirsel, who has led us in a debate of extraordinary fascination and remarkable relevance as well as of terrifying import and consequence. Although many speakers have striven to stress that the people of Eastern Europe are free and must be allowed to fashion their own destinies, I am of the school which asserts that that criterion is fine so far as it goes. However, many countries and millions of people outside Eastern Europe and Russia can claim, as I do, that it is not an island but part of the mainland.
The overwhelming sense that I gather from our debate, during which all noble Lords made balanced speeches, is that Britain cannot and must not remain on the edge or the sidelines. The responses made by the Government to a range of challenges posed by swiftly changing conditions, notably posed as questions by my noble friend Lord Cledwyn, will mark the Government out as fit to govern and worthy to lead.
I remind the Government that there are other countries and leaders who will be eager to play a major role. We in this House should urge and support the Government to be bold. Our chance may not come again. I pay generous tribute to the speeches that we have heard about Poland. But in addition to the events that took place in Poland in 1989, there are now reformist governments in Hungary and Bulgaria, and mass public demonstrations against the GDR Communist Party resulting in the dismantling of the most potent symbol of the cold war, the Berlin Wall. We have witnessed the significant free elections which took place in East Germany last week. There has also been the election

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of a former dissident playwright as the non-Communist President of Czechoslovakia. Further, there has been the revolution in Romania. Throughout this turbulent period in Europe, there has been a watershed of equal proportions in domestic Soviet politics, pioneered by Mikhail Gorbachev and his perestroika beliefs.
My noble friend Lord Cledwyn has added his experience and wisdom to that of many others in this debate. I certainly support what he said in regard to the yearnings of millions of people in Russia and in Eastern Europe. They yearn for democratic government, practical policies and peace and security. My noble friend used a phrase which I believe is very apposite. He said that the people of Eastern Europe yearned for politicians with guts and vision. That is an aspect of the debate tonight.
The noble Lord, Lord Thomson of Monifieth, said that this is a time of hope and of uncertainty. I agree with that. The noble Lord, Lord Brabazon, in his impressive speech told us we were in a period when events were settling down. He also gave the House news of a range of initiatives and events. We particularly welcome the news he gave us of the visit to Russia both of the Foreign Secretary and of the Prime Minister. He told us that there were opportunities in the swiftly changing field of security and defence. We must look forward to further agreements that can be made in that field. I look forward to hearing the noble Lord, Lord Belstead, tell us a little more about the Government's thinking on the conference that will be held in the autumn.
We must remind ourselves that the USSR is divesting itself of its empire in the West as completely as the British divested themselves, 40 years ago, of their empire in the East. Now the divided halves of the European family can come together once more and remain together. The remaking of Europe is at last possible. That is the task to which all our minds must now be turned. Our first task, in my view, must be to reabsorb the peoples of Central Europe into our cultural and economic community where they properly belong, and to reknit the ties between London, Paris, Rome, Munich, Leipzig, Warsaw, Prague and Budapest. If those people are reabsorbed, they may join our security alliance too. My noble friend Lord Cledwyn posed a number of questions regarding how a united Germany will fit into, or not be permitted to fit into, NATO or any other security alliance. That matter will be raised, if not settled, at the conference on security and co-operation in Europe which will be held in Helsinki.
I was particularly attracted to some of the opinions of the noble Lord, Lord Beloff. It may be far too easy an assumption on the part of the East Germans, the Poles and the Czechs that elections will automatically ease the path of economic reform. The ballot box may confer democratic authority on more would-be reformers, even in Gorbachev's Soviet Union, but elected governments are not immune from economic pain. When prices are freed, suppressed inflation breaks through, as has happened in Poland. When producer subsidies are cut, people lose jobs. When consumer subsidies go, living costs rise. When exchange rates are liberalised,
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the buying power of overvalued currencies falls. Eastern Europe needs all this and more, including such delightful Western medicine as bankruptcy law, to make the transition to a market economy, like a hole in the head.
The process of transformation will be difficult. A shared vision in East and West of joining in a unified European market will be vital in keeping that process on track. When I talk about a European market, I do not subscribe to the automatic absorption of those countries into what we know as the EC. Such a market, in my view, is the key to the hopes of Eastern Europe of obtaining the new technologies, managerial talent, organisational methods and financial capital that are needed to overcome the dismal economic legacy of the past 40 years.
The noble Lord, Lord Brabazon, was quite right when he said that all or any of those objectives would not be achieved overnight. They will be achieved by hard work and patience. For the West, the reintegration of Eastern Europe into the market system will offer not only enormous investment and trade opportunities but also the best hope that the unleashed energies of the East will be channelled into peaceful and constructive purposes rather than into a renewal of ancient rivalries. Western countries are only now starting to realise and to recognise how much they need to do to support the changes in the East. They must provide more leadership and vision and far more generous financial support. The most fundamental support that is needed is a commitment to incorporate the Eastern European countries into a common European market. I repeat that I do not automatically assume that that will constitute the European Community as we know it.
As Eastern Europe ends trade restrictions and makes currencies convertible, Western Europe must be prepared to accept new imports from Eastern Europe. One of the consequences of these dramatic and traumatic changes is that the Soviet Union will be required to absorb large numbers of officers into civilian life. Of the half million troops that are presently being demobilised, approximately 100,000 are career officers who believe they are entitled, as ex-officers, to jobs and homes that are in short supply. That problem will increase as troop cuts grow. In my view, Mr. Gorbachev is not likely to forget that when Khrushchev tried to cut the armed forces from 5 million to 3–8 million in the 1950s and 1960s, the revolt of the military was the final nail in his political coffin.
The Soviets are not united in their own desire to leave Eastern Europe, and in particular to give up the GDR which they regarded as their prize in the Second World War. Related to that is the need to ensure that there is no evidence of Western triumphalism as their troops leave so that face is saved. Finally, we must not forget that the Soviets will have other preoccupations; namely, the restructuring of their economy and their problems with minorities.
What are the prospects of a new security order? What will it be based on and who will participate in it? Many speakers have referred to the CSCE conference which is planned for the autumn. The departure of troops from Czechoslovakia and

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Hungary could well be completed by the end of 1993 at the latest, and it will probably be completed earlier than that. However, I think that the Poles will be the last to see the troops leave as the Soviets will want secure lines of communication for their troops through Poland until the final withdrawal from the GDR is completed. We on the Labour Benches want to see the maintenance of the defence of the UK at the lowest possible cost which will liberate resources for our industrial base and our economic reconstruction at the same time as maintaining our commitments to NATO.
We should stimulate the desire to play a full part in the establishment of a new security system for Europe which will encourage the growth of democracy and economic development in Eastern Europe. We should also welcome the continued progress in the Soviet Union under Mikhail Gorbachev towards economic reconstruction and the open society that he seeks.
How have the Western powers reacted to the revolutions of 1989? Some countries have responded piecemeal. The Americans have decided on defence cuts, as have the Belgians and the Dutch. The European Community, America and Japan have instituted substantial aid projects. Yet, although the 35-nation summit has been planned for the autumn there has been so far no effort at a concerted assessment of what has taken place and what the response should be. Such an assessment is essential and a British Government who really understand the significance of the events not only can but should take a lead in that assessment. I was very glad indeed to hear the noble Lord, Lord Brabazon, say that we should hear more on that subject when we hear from the noble Lord, Lord Belstead.
Cuts in defence expenditure and technological change have an impact on the armament industries— conversion from militarised economies, diversifications, making constructive use of the huge technological talents of the men and women employed in those industries. A sensible British Government should be conducting a major and fundamental review of the economic consequences of the peace process. In my view the Government have not even begun to think about it. Our policy on these Benches is that we should be working on that process now.
I was very glad to hear more than one reference to the need for a 1990 version of the Marshall Plan. My noble friend Lord Callaghan referred to that in his speech on 17th January. My noble friend Lord Cledwyn reiterated the point. We need a Marshall Plan for the 1990s. I hope that the noble Lord, Lord Belstead, will be able to say something about that point.
We on these Benches recognise the courage of Mr. Gorbachev and the pivotal part he has played and must continue to play in the future of Eastern Europe and the world. He deserves all the support he can get. From these Benches I say that he has our support in abundance.
Next, we sense that now is the time for Britain to play a significant part in creating new security
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arrangements for Europe and the world. In doing so we must never lose sight of the fact that the United States must be kept actively involved in all arrangements, for America has done much for which we in Britain and Europe can be truly thankful.
The continuing evidence of ethnic unrest within Russia and other Eastern European countries, referred to graphically by the noble Lords, Lord Beloff and Lord Hankey, brings the need for more patience and understanding. Britain must assist the process of reconciliation whenever possible. We must also recognise that as Germany achieves unification there will be an increasing need to assure her Central European neighbours that their security is not endangered.
We in your Lordships' House have had the great privilege not only to be here but to participate, albeit marginally, in world events as we have in our debate today. Make no mistake: we on these Benches take very seriously our opportunity and responsibility, both as the Labour Party and as the potential government of the land.
There is much common ground across the Chamber and on the assorted Benches in your Lordships' House. The school of thought which counsels haste slowly and which tempers our generous inclinations to compassion with caution so as to protect our security is a wise one. One step at a time, taken as quickly as is practicable, is wiser than a headlong rush into what we know not.
There is an air of excitement, of wonder and of hope wafting across the plains and the Channel. Even though we know that the times will prove dangerous, and sometimes dispiriting, we can join in the wonder and the miracle that after 45 years of darkness Europe has been given another chance. It is the bright light of the future towards which we must march. It is the opportunity to examine that prospect for which we express our grateful thanks to the noble Lord, Lord Home, and all others who have participated in our debate.
7.15 p.m.
The Lord Privy Seal (Lord Belstead): My Lords, I should like to join with other noble Lords in thanking my noble friend Lord Home for today's debate. It has enabled many of your Lordships, led by my noble friend in his most interesting speech, to draw on very valuable experience in trying to chart our course for the future. My only regret this evening is the absence of the late Lord Stewart of Fulham. We miss him, especially on an occasion such as this.
My noble friend Lord Brabazon outlined at the beginning of the debate the issues and priorities facing us today in Eastern Europe and the Soviet Union. My noble friend also set out some of the ways in which Her Majesty's Government are responding to those challenges and opportunities.
The noble Lord, Lord Graham of Edmonton, in winding up for the Opposition, asked, what of the new security order? Quite rightly the noble Lord put his finger on the possibilities of utilising the Conference on Security and Co-operation in Europe, about which I should like to say a word or two in just a moment.

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My noble friend Lord Home's debate is being held as we are witnessing a historic retreat from the ideology of the Russian revolution. That is most of all apparent in Europe, where the intolerant philosophy of communism deprived first the Soviet people and then the peoples of Eastern Europe of the opportunity to recover from two world wars.
In opening the debate my noble friend referred to the sheer pace of events. That is something to which several noble Lords have referred. My noble friend also recognised in his speech the fact that over the past four decades one thing did not change. That was the denial of political and economic freedom in those countries of Eastern Europe which we are debating, which has been immensely damaging to them. Civil society was oppressed by arbitrary one-party rule and was permeated with fear and suspicion. Individual creativity and initiative were frustrated or distorted to serve the purposes of the state. As the noble Lord, Lord Parry, said in his speech, barriers were imposed to isolate citizens from all but officially approved contacts with the outside world by placing restrictions on travel.
Our continent as a whole suffered the consequences of those denials of freedom. Since the war Europe has been condemned to over 40 years of division and enforced separation, felt most keenly in Germany and Berlin. The rich and diverse tradition of European culture and thought was interrupted as other great cities— Prague, Warsaw and Budapest— languished behind the Iron Curtain. Now at last there is a chance to repair the damage. There is the prospect of renewal, both of the societies formerly subject to one-party rule and of the relationships between the nation states of Europe.
Speaking of Soviet Russia, my noble friend Lord Dacre, while clearly recognising the risks and uncertainties which are inherent in the present situation, nonetheless expressed a measure of optimism for the future. It is the case that in the Soviet Union President Gorbachev has, to his credit, pursued an ever more radical programme of reform in an attempt to equip his country to face the economic and other challenges of the late 20th century. In Central and Eastern Europe overwhelming pressure for change has now brought to power leaderships which are committed to reform. The move everywhere is towards democratic politics and market economics. Although of course I recognise the dangers and the great problems to which my noble friend Lord Beloff referred, nonetheless I join with the noble Lord, Lord Bonham-Carter, in saying that now at last is a rare opportunity and that we have to do our best, we have to do all that we can, to give encouragement and support.
There is little doubt in my mind that the successful example of the West over many years has played its part in bringing about that transformation. However, we should not recall that in an empty spirit of self-congratulation. Rather, we must draw lessons from it so that we can open a new chapter in European history.
In Western Europe since the war, we have assured security and stability through close political relationships between our countries. We have
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developed organisations such as NATO, the European Community and the Council of Europe, mentioned specifically by my noble friend Lady Elles, in order to express our common values and interests in terms of common action. Working together within those organisations, we have succeeded in establishing lasting peace and growing prosperity.
The time has surely now come to broaden our horizons. We need to find ways to enable all Europe's peoples to share in the benefits which have come to us from co-operation in freedom. Our aim should be a continent free of the artificial divisions of the past. We should not, in so doing, neglect our own defences. NATO remains the cornerstone of our security and an essential vehicle for arms control negotiations. We could not have achieved 40 years of peace and stability in Europe without it.
Perhaps I may respond to the interesting speech of my noble friend Lord Eccles. We must keep the NATO alliance at the heart of our defence policy while adapting it to meet new tasks. The nature of European security is changing. Ideological confrontation is diminishing and it must be clear to everyone that good political relations arising from shared principles and outlooks are a far better way— and, as my noble friend Lord Home said, a more cost-effective way— to ensure long-term security than the confrontation of large opposing forces.
That is well illustrated by our experience of arms control. I think I am right in saying that progress with arms control has always been linked to the broader climate of East-West relations. In the CFE negotiations, we are now working towards balanced and verifiable reductions— a matter on which my noble friend Lord Home laid great emphasis in his speech. So the time surely is now right to work towards a more political concept of security in Europe where problems can be addressed jointly through co-operation.
Following the line of thought of my noble friend Lord Home when he spoke of a pan-European system, my right honourable friend the Foreign and Commonwealth Secretary has suggested that in the new political climate in Europe we should develop the Conference on Security and Co-operation in Europe— the CSCE— which adopted the Helsinki Final Act in 1975. We should develop it as a unifying framework for political stability within which we can work to make democracy and human rights more permanent and secure across our continent. That point was made well over a month ago by the noble Lord, Lord Cledwyn, in the debate initiated by the noble Lord, Lord Callaghan, and was repeated by the noble Lord, Lord Cledwyn, from the Opposition Front Bench today.
The CSCE offers a number of advantages. It has the right membership for it comprises the nations of Europe, including the Soviet Union, together with the United States and Canada who will continue to play a vital role in European security— a matter emphasised by my noble friend Lord Eccles and to which the noble Earl, Lord Perth, devoted his remarks. Moreover, the CSCE's agenda includes the subjects with which we shall be most

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concerned— democracy, human rights, security issues, frontiers and co-operation in general.
The CSCE also has to its credit an established record of achievement in improving respect for human rights and strengthening military confidence. But, in the years since 1975, it was difficult to develop its full potential while governments in East and West had different attitudes to human rights and democratic freedoms. However, now, for the first time, all 35 participants display a wide area of agreement and genuine commitment in their approaches to the Helsinki principles. The opportunity exists to translate that into forms of co-operation which will strengthen the welcome political trends now emerging in Central and Eastern Europe. The need is for ideas which can be endorsed by the CSCE summit meeting later this year, as a basis for future work.
Britain has already offered some suggestions. Last year, at a CSCE meeting in Paris, Britain, the United States and other countries put forward proposals outlining criteria which might be observed in order to guarantee the freedom of elections and reinforce the rule of law. That is soil in which democracy can put down strong and lasting roots in countries where for so long democracy has been denied. We hope that our practical proposals, designed to serve the end, will be reflected in the conclusions of the forthcoming summit.
I was interested in the warning by the noble Lord, Lord Hankey, of the possibility of trouble which might occur within Eastern Europe in the future. Picking up that point, perhaps I might say that my right honourable friend the Secretary of State has also recently proposed a role for the CSCE in conciliation as a way of peacefully settling disputes that might arise between its participants. There is, for example, the possibility, which I believe was in the mind of the noble Lord, Lord Hankey, that reawakened nationalism might lead to tension and argument between different European countries. It would be the job of the CSCE to seek to prevent the escalation of such disputes. We are working on some more detailed suggestions for the kind of procedures that might apply in such cases and we intend to make those public in due course. We believe that the summit should also consider whether the CSCE is well enough equipped for the wider role that we envisage for it. We hope therefore that the summit meeting will also look at the ways in which the CSCE's work is organised to see whether those can be made more effective.
All noble Lords who have spoken today have referred to the subject of German unification. I join with all noble Lords in welcoming the prospect of a united and democratic Germany integrated securely into the wider European framework. We respect the choice of the people of the German Democratic Republic, as we have always respected the right of the German people to self-determination, and we are ready to work to help them achieve unity.
Perhaps I may say in passing that it was the concern of my right honourable friend the Prime Minister about the need to consider the important
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external aspects of unification which led to establishing the two-plus four mechanism. The noble Lord, Lord Greenhill, underlined the importance of that in his speech by making the point that agreement in the two-plus four talks with the objectives of settling borders and obtaining agreement about new arrangements between NATO and the Soviet Union, are matters of the highest importance. The first meeting of officials in the two-plus four talks took place last week and agreed, in response to clearly expressed Polish wishes, that Poland will be involved in the two-plus four talks when border issues are discussed. We also favour full consultation in NATO and the European Community which must ensure that all concerned are satisfied with progress towards unification and that the external issues are being properly addressed.
Finally, there is the wider process of bilateral contact and consultation which is going on all the time. On the subject of carrying out those important discussions, particularly about external matters, my noble friend Lord Fanshawe of Richmond said that we must work closely with France. I take that point very much to heart. We must, and I assure my noble friend that we do. Perhaps I may tell the noble Lord, Lord Bonham-Carter, that we in Britain are working closely with our European partners in order to try to build a more secure and more prosperous future for Europe. In doing that, so far as concerns German unification, we, the federal republic and our allies and partners know where we wish that process to end. For reasons that were made clear by the noble Lord, Lord Cledwyn, we want a united Germany to be a full member of NATO and of the European Community. However, as my noble friend Lord Brabazon said at the beginning of the debate, there are still some important stages to be negotiated on the way to that conclusion.
The noble Lord, Lord Cledwyn, asked one direct question: what about Germany's NATO membership? It is a subject on which we remain at variance so far as the Soviet Union is concerned. We hope that Soviet objections will not prove insurmountable.
As my noble friend said at the beginning of the debate a wide consensus exists on that point as well as a readiness to take into account Soviet security concerns. While we naturally anticipate that forces of NATO allies will continue to be stationed in West Germany, we believe that special transitional arrangements may well need to apply to East Germany. I hope that our continuing discussions with the Soviet Union in the two-plus-four talks and elsewhere will enable us to set Soviet fears at rest.
Meanwhile so far as concerns the Community we look forward to an open and thorough discussion within the Community on Community aspects of unification. We hope that the informal summit in Dublin next month will start the process of detailed negotiation and that it will be possible to incorporate what is now the GDR into the Community framework as quickly as possible after unification.
The noble Lord, Lord Moore of Wolvercote, and my noble friends Lord Dacre and Lord Belhaven and Stenton, referred to the absolutely crucial issue of the maintenance of the Oder-Neisse line. The

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recent resolution of the Federal German Parliament in favour of guaranteeing Poland's existing western border is an encouraging basis for future work. Britain will certainly do all it can to ensure that this results in a treaty which is acceptable to both sides. We are also ready to play a full and constructive part in the discussions that lie ahead on the future of the legal rights and responsibilities of the four powers in Germany and in Berlin.
Perhaps I may say a few brief words about British aid to Eastern Europe. They will be brief because earlier my noble friend Lord Brabazon spoke about this matter at some length. My noble friend Lord Home, the noble Lord, Lord Cledwyn, and other noble Lords spoke about the enormous importance of economic assistance to the reforming countries of Eastern Europe. Let me once again emphasise what is being done. The noble Lord, Lord Cledwyn, asked for confirmation that any aid will be co-ordinated through the European Community. Obviously, the international agencies— the IMF, the World Bank and indeed the Group of 24— are absolutely crucial to the international effort that is being made. But, as the noble Lord, Lord Thomson of Monifieth, quite rightly said, the Community has a very important part to play.
It is no mean feat for the European Community, international financial institutions and individual Western countries including ourselves to have come forward with such a wide range of initiatives in a matter of only a few short months. The initiatives range from emergency relief of various kinds to stabilisation funds and our own know-how funds, mentioned specifically by my noble friend Lady Elles and the noble Lord, Lord Thomson. They spoke of the importance of training for which the know-how funds will be useful, as indeed will be the establishment of a European training foundation which is now being discussed as a result of the Strasbourg summit.
There are other kinds of support for far-reaching structural reform, Community trade and co-operation agreements and, in due course, association agreements, which will serve to sustain and strengthen the economies of Eastern Europe as those economies develop along new and very different lines in the months ahead. I am absolutely certain that the quality and quantity of Western support will continue to grow. There can be no doubt that a very substantial start has been made.
Perhaps I may pick out one other point on aid. The noble Lord, Lord Moore of Wolvercote, emphasised his belief that this country could help in the development of democratic institutions in the countries that we are discussing. I simply say that in all that we do, particularly in contributing and providing training, we shall keep in mind very much the words of the noble Lord.
Finally, the noble Lord, Lord Kagan, spoke about the Baltic republics. It seems likely that there will now be negotiations between the Lithuanians and the central Soviet authorities. We hope that these negotiations will begin soon and will help to ease the disturbing tensions that have recently arisen. We hope that negotiations will lead to the people of
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Lithuania achieving their wish. President Gorbachev and other Soviet leaders have stated clearly that there can be no resort to force in this delicate situation. We welcome those assurances and believe that negotiations are the right way forward.
Many noble Lords, while being quite realistic, have expressed hopes about what is happening in Eastern Europe and the Soviet Union. Of course there is also uncertainty and the risk of instability which one cannot afford to discount. My noble friend Lady Strange was quite right to anchor the issues that we have debated today in the rich and chequered history of our continent. But, contrasting the state of Europe today with its history of division, injustice and conflict in decades gone by, I believe that we have reached a turning point. New aspirations and new energies have been released and with them the opportunity to bind together the nations of Europe more closely than before. Before us is the promise of a decade in which freedom can be firmly established across our continent.
The Government are determined to work to fulfil that promise. Our aim is to have a new pattern of relationships in Europe based on democratic values in which all can prosper and feel secure; likewise, in our contacts with the countries of Eastern Europe and the Soviet Union, in our approach to German reunification, and in our work in NATO, the Community and the CSCE. This is and will remain our consistent goal.
7.35 p.m.
Lord Home of the Hirsel: My Lords, it remains only for me to express my gratitude to the many noble Lords who have contributed to this debate from a wealth of varied and specialised knowledge. It has been a fascinating exchange of views and, I think, a rewarding one for all who have been present.
The debate has illustrated the enormous programme of constructive negotiations which have to be undertaken in the months and years ahead, essentially by the United States, by Members of the European Economic Community and by the Soviet Union, if we are to build together in binding treaty form— because that is the form that it will have to take— the foundation for a lasting peace in Europe and the Atlantic area. I am grateful too to my two noble friends who spoke from the Government Front Bench for telling us that it is the Government's intention to play a leading part in that peaceful design.
Like many of your Lordships, I have lived through two world wars. Anyone who has done that, and anyone who has some knowledge of history, is unlikely to be anything but cautious. It is right that we should exercise caution. I say only that if the spirit which has animated speakers from all sides of the House in this debate is reflected outside this Chamber, as I hope it is, then the approach to the future can be looked upon with cautious optimism. I beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave, withdrawn.

Heathrow Express Railway Bill [H.L.]
7.37 p.m.
Lord Jenkin of Roding: My Lords, I beg to move that this Bill be now read a third time.
Exceptionally it is over a year since we had the Second Reading of the Heathrow Express Railway Bill in this House. I feel that the Bill has proceeded rather like an elderly steam train in a series of jerks and bumps. We have now managed to arrive at this important intermediate station on the Bill's journey to its final destination— the statute book.
The Select Committee sat for 25 days in all, making, so I am advised, that Committee stage one of the longest for opposed Private Bills in your Lordships' House in recent years. It is clear from the special report that the Select Committee took immense care in the deliberations with which they were charged. The result is in that report dated 14th February. My noble friend Lord Hood and his colleagues laboured hard and long and deserve the unstinted thanks of us all.
Before I refer to three specific matters, perhaps I may remind the House that what the Bill provides for is a high speed rail link between Paddington and Heathrow Airport. The link would provide a 15 minute service from early morning until late at night and the travel time would be about 16 minutes to Terminals 1, 2 and 3, and 20 minutes to Terminal 4, at Heathrow; and of course the other way. Brand new 100 mph electric trains specially designed for the service will be provided. It will be operated to a very high standard. The Bill has still to make its way in another place, However, if it can receive Royal Assent by July of this year, it is hoped that work can start on the new rail link in 1991 and that the rail service can begin in 1994.
The three issues to which I should like to draw your Lordships' attention are, first, the additional provision. The committee could not accept the original route proposed for the reasons that are set out very clearly in paragraphs 7 and 8 of the Special Report. I do not need to refer to those in detail. From the airport junction the original proposal was a viaduct which would go over the M.4 motorway before it descended into the tunnel on its route to the airport. However, the promoters were in due course given leave to proceed by way of an additional provision— in effect a longer tunnel which would go under the M.4, and the route would therefore be in the tunnel from the point at which it leaves the airport junction all the way to the airport terminals.
However, that petition was also opposed, so that further hearings took place at the end of which the amendments in the additional provision were accepted by the committee. Perhaps I may say this. While one may argue the particular merits of the change— and it was decided only by a majority of three noble Lords to two— no one can possibly cavil at the need to provide for the highest environmental standard for an important work of this nature. Yes, a longer tunnel will cost more. It will require a marginally higher fare to be paid. The project, however, remains viable and certainly an environmental improvement will have been made.
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The second point refers to the Paddington end of the railway. Since the Bill was deposited, Westminster City Council has received several major planning applications covering the Paddington special policy area. These are still under consideration. Indeed, they are out for public consultation, and the consultation period was not to end until the 30th of this month. If these planning applications are approved, it seems probable that an entirely new traffic scheme can be incorporated which will result in greatly improved access to the express rail terminal at Paddington Station. It appears that it may well be feasible to have access by vehicles on a deck above the railway line, with sophisticated escalator and lift links to the platforms. I understand that it is the promoters' intention, if this can be done, to incorporate a really modern user-friendly facility to give access to and from the new express train service. I would express the hope that it might incorporate check-in facilities so that people could check their luggage in and then go all the way to the airport.
However, as is clear, this requires much more detailed study jointly by the promoters, the developers and Westminster City Council. With that in mind, Westminster City Council withdrew its petition on the Bill, a Second House undertaking from the promoters having been given, leaving it open to the council to petition again in another place if that is necessary. Therefore that part of the proceedings is not yet certain. But I believe that it offers the hope of an eminently satisfactory solution which will meet the anxieties of the Westminster and Paddington residents who have been worried about the increased traffic.
Finally, there is the issue of linking the new service with a possible West-East cross-rail link between Paddington and Liverpool Street, as was put forward in January of last year in the Central London Rail Study. It would be perfectly feasible, so I am advised, for some of the trains from Heathrow to go onward from Paddington to Liverpool Street with intermediate stops at, say, Bond Street, Tottenham Court Road and Farringdon. The advantage of that would be that it would allow direct rail interchange with the Stansted to Liverpool Street service— something which would be of immense value to those who might have to change airports. Those who have had to do that, for instance, in Paris know just what a long time it can take to travel from de Gaulle airport to Orly. There is no rail link.
It would probably be out of order to discuss that aspect in any detail and I do so only to express the hope that when the Government make their promised statement later this year on the cross-rail links they will recognise the immense attractions of the West-East line because of its potential to take trains direct from the Heathrow express railway. It will greatly enhance the attractions of the Heathrow line. It will reduce the pressure on Paddington and will provide a swift and attractive railway link between Heathrow and Stansted, involving of course a change at Liverpool Street.
However, for the present we are concerned with the Paddington to Heathrow express rail. It is a much needed scheme, not only to improve access to

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and from Heathrow, but also to ensure— a very important point— that Heathrow remains Europe's number one airport. It faces many challenges, not least from the Charles de Gaulle Airport serving Paris. But it is vital for the future of the British aviation industry, and for Heathrow Airport, that the high speed rail link is in service as soon as possible. I hope therefore that your Lordships will give the Bill a Third Reading.
Moved, That the Bill be now read a third time.— (Lord Jenkin of Roding.)
7.48 p.m.
Viscount Hood: My Lords, perhaps I may add a word to the Motion so ably moved by my noble friend Lord Jenkin. He has described the railway and its purpose. I need say only one or two words amplifying the report. I had the honour to be chairman of the committee.
In our proceedings all accepted the importance of the railway and the urgency of achieving it. Also no alternative to Paddington was seriously suggested. We did indeed decide that the original route was not suitable. It passes through a green belt— not the greenest of green belts but nevertheless a green belt— and it was felt that that important industrial development could not but damage the green belt in some degree and indeed lead to further damage from other sources. We made our recommendations in the hope that the promoters would come forward with an alternative. They did. It follows very closely the line of the original route but passes underground as soon as practicable after leaving the Western Region line.
Two problems took up the greater part of the discussions. The first concerned methane. There is, it was agreed by both sides, a danger from methane. However, equally both sides in the petition agreed that provided it was properly handled, that proper advice was taken and studies were made, this could readily be dealt with. The Committee was satisfied with the promoters' proposals and it could not accept the petitioners' proposals; namely, to undertake exceedingly expensive containment of the area and removal of the contents of the tunnel over a long distance. The cost of that would have been considerable. It would have created delay and uncertainty as to whether the proposition would remain viable. Therefore, we accepted the alternative route.
We then turned to Paddington. As my noble friend Lord Jenkin said, that is still under discussion between the responsible authority— the Westminster Council— and the promoters. In our report the committee expressed the hope that that would be satisfactorily decided and, as a committee, we were much impressed by the proposals put forward in considerable detail by the promoters with their technical advisers.
While we appreciated the earnestness and anxieties of the Paddington residents, we felt that they were undue concerns and we decided that the Bill should proceed. I hope that it will proceed in this House and in due course that it will go through another place. I hope that this very necessary route will soon be built.
Baroness Nicol: My Lords, I should like to pay tribute to the way in which the promoters approached the environmental problems which came to be recognised after the first sitting of the committee. They seemed to me to approach them with imagination and great willingness. I think that the scheme which was eventually produced for the environmentally sensitive part of the route should be a model to any others who are considering this sort of development. I thank them for the work which they put into that, and I hope that they will be able to carry out the whole scheme which they put to the committee.
7.53 p.m.
Lord Underhill: My Lords, after the explanatory speech of the noble Lord, Lord Jenkin, and the explanation of the work of the committee by the noble Viscount, Lord Hood, there is not a great deal I wish to say on the general scheme. On Second Reading, I gave my full support to the proposals and have no reason to change my opinion.
I should like to join my noble friend Lady Nicol in expressing appreciation to the committee for the attention which it gave to the environmental question, for having the courage to reject the first route and for being prepared to discuss an alternative route with the promoters. I am very pleased to know that agreement was reached with the promoters on environmental considerations. The committee is to be thanked for those two achievements.
I said on Second Reading that there was general agreement that Paddington was the suitable London terminus for this fast link from Heathrow. Nevertheless, at that time I expressed concern at the possible traffic problem around the roads in Paddington and the urgent need for traffic management.
In its report the committee said that it could understand the concerns of the Paddington residents' organisation— known as PRACT— and the committee gave that matter serious attention. I am delighted to learn from the noble Lord, Lord Jenkin, of the additional proposals which may be considered before the Bill leaves the other place.
I was pleased to know that the Westminster City Council as the highway authority involved seems to have that matter very much in mind. It is particularly alive to the need for enforcement against the possibility of long-term parking in residential roads in the Paddington area. However, there is one problem. Paddington and King's Cross are not far apart and King's Cross will be very important, provided that Bill goes through, as the second international terminus for Channel Tunnel traffic.
I could not follow altogether the argument put forward by the residents organisation that the promoters had ignored possible increases in traffic from Heathrow due to the opening of a fifth terminal. It seems that if there is to be a problem as regards increased traffic, that will arise from an increase in the number of flights taking off or leaving Heathrow or in the use of larger aeroplanes and not the question of a fifth terminal. It is a question of how many extra passengers may or may not proceed from Heathrow.

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The other matter with which I am concerned— and I read very carefully what the committee said about that— is that the final section of the report dealing with Clause 39 in the original Bill, which is now Clause 38 in this Bill, sets aside Section 56 of the Transport Act 1962 whereby the Secretary of State has to examine the closure of any rail station or line where such closure would cause hardship.
From the report of the committee we see that the promoters argued that the link:
"would be a privately operated service run on commercial not social criteria".
The promoters claimed the right to close the line if it was proved commercially non-viable. I argue that this is not just a commercial line but is a line which really satisfies social criteria. It will be of great assistance to the travelling public. We should also bear in mind that the committee said that any closure of the line would, at the most, inconvenience users of other parts of the transport system.
The London Regional Passengers Committee, which petitioned against that part of the Bill, argues that it will not be long before this fast link becomes part of the London transport system. I argue that its closure would cause far more than inconvenience. It would literally cause hardship. It is because of the problems of travelling to Heathrow on the Underground at present that we urgently need this fast link to Heathrow. It is not merely that passengers can reach there quickly but it is in order to relieve congestion on the present Underground system to Heathrow. Therefore, I am concerned about that part of the committee's report. I argue that if there was any question of closing the link the Secretary of State would have to take account of the wider public interest.
The committee also argues that the link is a private enterprise project and therefore does not entail a public service obligation. I understand that the British Airports Authority is providing 80 per cent. of the funding and British Rail, Network SouthEast, is providing the other 20 per cent. Quite rightly, both claim that that is a unique partnership between the private and public sector and is not purely a private commercial undertaking. As British Rail is a public owned industry, it is not just a private enterprise, as stated by the committee.
In addition to providing drivers, the electric power and the platform staff at the designated platforms at Paddington Station, British Rail will have to make considerable arrangements at Paddington to cope with this project and to run a good part of the Heathrow traffic over the British Rail main line.
The noble Lord, Lord Jenkin, explained the possibility of extending the use of the line from Heathrow to a cross-link line to Liverpool Street and farther on to Stansted. That surely would make any question of closure even more important. It would certainly be far more than inconvenient and it would be in the public interest that the Secretary of State should intervene should there be any question of closure of the line because of its commercial viability.
I hope that this Bill will go through in the other place. I hope the points I made receive attention.
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There is no doubt that the link is one we all desire. The committee did a very good job of work. However, we must still be concerned about congestion around Paddington and about the possibility of closure of the line should the promoters consider, once it is in operation, that it is commercially non-viable.
8 p.m.
Viscount Davidson: My Lords, we last debated the Heathrow Express Railway Bill in your Lordships' House over a year ago, when we gave the Bill a Second Reading. Since then the Bill has been subjected to close and careful scrutiny, particularly on the detail of the route, but also in regard to other matters. I should like to thank my noble friend Lord Hood and the members of the Select Committee for all their hard work and for their excellent report.
As noble Lords know, the Government fully support the principle of the Bill. We are therefore particularly pleased that the promoters were given leave to submit an additional provision to amend the route in the light of the concerns about environmental impact expressed by the Select Committee. We believe that the promoters made a significant concession to those who objected to the original route. They have taken upon themselves considerable additional costs for the extra tunnelling that will be needed and have committed themselves to an extensive programme of environmental and safety measures.
I should remind your Lordships that this Bill, as the noble Lord, Lord Underhill, said, represents a joint venture between BR and BAA, with BAA taking the largest share of the risk and putting up about 80 per cent. of the capital costs. It is folly to assume that any company in the private sector has a bottomless purse. We understand that the additional costs of the amended route have already pushed the project to the limits of viability. The Government hope therefore that the compromise reached in this House with regard to the route will hold good in another place.
There was also a great deal of discussion concerning the effect of the rail link in the area around Paddington station. The Government recognise the legitimate concerns of local residents about increased traffic but are confident that the promoters and Westminster City Council will be able to reach an agreement which will satisfy all the interested parties.
A subject which will no doubt be discussed again in another place was whether the statutory closure procedures should apply to the Heathrow service. The Government's view, as outlined in the report presented to the committee, was that they should not, since the new service was a commercial undertaking for the benefit of air travellers which should stand or fall on commercial criteria. We note that the committee agreed that the question of hardship from closure of the link did not arise and that there was therefore no need to amend the Bill.
Finally, some have argued that additional rail links should be added to the proposed Paddington-Heathrow link; for example, a link to Southern

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Region or a westbound link on the main line. This Bill does not preclude any of these developments in the longer term, but the priority is for a high quality link to London, which is exactly what the Bill provides and what the Government support. I hope, therefore, that the House will allow the Bill to proceed to another place.
8.3 p.m.
Lord Jenkin of Roding: My Lords, I am grateful to noble Lords who have taken part in this debate. I do not think there is anything I can usefully add. The argument with regard to Section 39 of the 1962 Act was one serious point raised by the noble Lord, Lord Underhill. It was very carefully considered by the committee and, given the commercial nature of the project, it seems to me that the committee wisely came to the conclusion that that section of the Act should be excluded. I was grateful to hear the assurance of my noble friend on the Front Bench that the Government accept that view. One hopes that it will be accepted in another place.
The only other point I wish to make is to warmly endorse what the noble Baroness, Lady Nicol, said
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about the environmental care of the promoters. The committee certainly took care and I pay tribute to its members for that. However, the noble Baroness was right in saying that the promoters had also taken great care. It was very gratifying to see the very warm praise by the committe of the environmental scheme that had been adopted for what were called the Stockleigh ponds. I am grateful that the noble Baroness spoke those few words. They will have been heard with thanks by those who represent the promoters. I hope that the House will give the Bill a Third Reading.
On Question, Bill read a third time, and passed, and sent to the Commons.

Redbridge London Borough Council Bill
Brought from the Commons, read a first time and referred to the Examiners.
House adjourned at five minutes past eight o'clock.

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