Sitting of 24 February 1993

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
Oral Answers to Questions
  ENVIRONMENT

    Contaminated Land Register
    Mr. Hawksley: To ask the Secretary of State for the Environment if he will make a statement on the setting up of a contaminated land register.
    The Minister for the Environment and Countryside (Mr. David Maclean): I want to end the uncertainty as soon as possible. I intend to make a statement shortly on our proposals for registers of land that may be contaminated.
    Mr. Hawksley: May I thank my hon. Friend for his answer? It is disappointing that he has not been able to give us a statement today. However, I thank him for the way in which he received courteously the all-party delegation of black country Members who made representations for the register to be abandoned. May I make my hon. Friend aware that the banks, especially in the west midlands, which is an area covered by contaminated land that would all be on the register if it were set up, are now starting to tell people that they will reduce the value of their security if action is not taken quickly to get rid of the threat of a register? Will my hon. Friend come quickly to the House to make a statement?
    Mr. Maclean: I thank my hon. Friend for his comments. I was grateful to him, to other hon. Members from all parties who attended and to other all-party delegations that came to see me to make this point. As my hon. Friend is aware from our discussions, this is a complex matter. There are some fundamental flaws in the present proposals, but finding the right solution, which will not cause unnecessary blight, which will allow sensible development to take place, which will ensure that actively contaminated land is cleaned up and which will ensure that all people who have the right to know get to know, is not easy.
    I am conscious of the need to act rather quickly and I hope that not too long a time will elapse before we can announce our firm proposals. I am absolutely convinced of one thing: I must get it right rather than give a rushed and speedy response.
    Mr. Chris Smith: Is it not clear, however, that on the issue of contaminated land, the Government are trying desperately to scrabble out of a mess of their own making? Is it not the case that at present, the Government's proposals provide no incentive for the decontamination and treatment of land that is contaminated? Any register,
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    any system and any amendments to the planning system that the Government produce must provide precisely such an incentive.
    Mr. Maclean: It is unfortunate that the hon. Gentleman has his facts slightly wrong on this important issue. Incentives are available for cleaning up contaminated land. Although the Government make generous funds available, it is a tripartite exercise. We need funds from the Government, we need the response of the local authority and, of prime importance, we need the money from private enterprise, from the banks and from the building societies.
    We shall shortly bring forward proposals on how we see the way ahead. We have done the correct and honourable thing. We brought forward proposals for consultation and the consultation process has revealed some flaws in the proposals. We intend to ensure that when we bring forward our final proposals, we have taken on board all the views we have heard from all sides—I stress all sides —so that we can have proper industrial development and the regeneration of city areas that much need it.
    Mr. Pickles: Does my hon. Friend accept that although there are plenty of inducements for taking care of contaminated land, there is a danger that the proposals as currently drafted might prevent that land from being used? Does my hon. Friend agree that it would be a great shame if the proposals caused areas within our inner cities to be abandoned? Does he accept that quite a lot of work has been done on getting rid of contaminated land? Will he give a commitment that when the register comes, it will be used as an incentive in terms of recognising that good work can be done and that land can be brought back into commercial use for people in inner cities?
    Mr. Maclean: One of the most instructive visits that I have made recently was to the black country. There I was shown areas of land that had been cleaned up and were now perfectly suitable for their current use. District councils there gave me the message loud and clear that the present proposals would involve the danger of causing unnecessary blight. All hon. Members agree that we must deal with land that is a problem and which needs cleaning up and not just compile blacklists of land that might possibly have been contaminated some time since the Romans arrived. That is what I am addressing my mind to, and I am looking at the liability question. I want the land in our cities to be used. I do not want 600,000 acres of contaminated or potentially derelict land left idle and the countryside used instead.
    Mr. Simon Hughes: If the Government are to make a U-turn and scrap section 143 of the Environmental Protection Act 1990, will the Minister at least give us two assurances? The first is that there will be a requirement that contamination be cleared before planning permission is given. The second is that every portion of land is given a statement on its contamination level before it is developed.
    Mr. Maclean: The hon. Gentleman is trying to jump too many hurdles at once—he is trying to look too far ahead. As I have said, I hope to make a statement shortly on how we see progress on this matter. My aims are simple and straightforward: to ensure that those interested in knowing the state of the land have their rights protected —the right to know is terribly important; and actively to

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    encourage the use and cleaning up of contaminated land —cleaned up not to some absolute standard but so as to be fit and suitable for the purpose for which it is intended.
    Mr. Ashby: If a builder has spent millions of pounds decontaminating land and has built houses there, he should not then be faced with a solicitor telling him that a potential purchaser will not buy a property there because the land is on the register of contaminated land. That must not be allowed to prevail. There must be a system for taking land off the register once it has reached a standard of decontamination that is considered correct.
    Mr. Maclean: My hon. Friend is absolutely right. This is one of the fundamental problems with the earlier statute. Once land has appeared on any published register, no matter how much it has been cleaned up it cannot come off the register. That is unacceptable. Opposition Members have also made the point to me that this is a problem which we should not put up with.
    We are giving our attention to this problem and I want to look at every possible measure to get around it.

    Urban Programme
    Ms. Corston: To ask the Secretary of State for the Environment if he will make a further statement on the effects of the abolition of the urban programme on his inner city strategy.
    Mr. Grocott: To ask the Secretary of State for the Environment if he will make a further statement on the effects of the abolition of the urban programme on his inner city strategy.
    The Secretary of State for the Environment (Mr. Michael Howard): The urban programme has not been abolished. We have made available £176 million for the urban programme in 1993–94, which will enable us to honour in full all existing commitments and provide £20 million for urban partnership fund projects as part of the new capital partnership programme. Planned resources for my Department's urban group of programmes for 1993–94 will increase by over £90 million, taking total spending to over £1 billion.
    Ms. Corston: Is the Secretary of State aware that the effect of the cuts in the Bristol urban programme means that Bristol, which receives £1.7 million this year will receive £1 million next year, £500,000 the year after that, and after that, nothing? The cuts mean that jobs will be lost in areas such as Barton Hill in my constituency, where male unemployment is 43 per cent. They could also mean a threat to projects such as the provision of hostels for homeless women—and this in a city which, after London, has the highest number of homeless people.
    What excuses will the Minister for Local Government and Inner Cities offer when he goes to Bristol on Friday to explain why Bristol is to be treated in such a shabby fashion? What excuses does he have for the failure of his inner city policy?
    Mr. Howard: When my hon. Friend goes to Bristol on Friday he will seek to ensure that the thoroughly misleading impression given by the hon. Lady is corrected. He will tell the people of Bristol about the £500,000 that will be made available to them through the urban partnership fund next year. He will tell them about the £9·3
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    million to be made available to Bristol development corporation next year. He will express the hope that the hon. Lady and her party will at last support the activities of that corporation. He will tell the people of Bristol that the 57 urban priority areas are expected to be able to spend between them £0.5 billion in capital receipts in the current year, and what tremendous opportunities there are if only their local authorities were prepared to play their full part in taking advantage of them.
    Mr. Grocott: First, perhaps the Secretary of State will apologise to the House and to me for not following the normal parliamentary courtesy of letting us know when questions are linked. Will he get off his high horse and apologise?
    Secondly, does the right hon. and learned Gentleman acknowledge that the loss of urban funding is a bitter blow to us in The Wrekin because many of our schemes, such'as home security and street lighting schemes, were designed to deal with vandalism and crime problems? Is it not a pretty absurd Government who have the Home Secretary telling us one day that law and order is a crucial issue when, the next day, the Secretary of State for the Environment instructs splendid local authorities, such as The Wrekin, to cut essential crime prevention measures?
    Mr. Howard: The Wrekin will benefit from the urban programme to the extent of nearly £1 million this year and more than £500,000 next year. So far as crime is concerned, my Department will make available £130 million in the current year from estate action, crime prevention and security measures, and more than £23 million from our urban block of programmes on crime prevention. In all, 31 city challenge area partnerships have been formed with existing agencies to tackle crime in co-ordination with other urban regeneration measures. We are taking extremely seriously our responsibilities on measures to tackle crime effectively in inner cities.
    Mr. Ward: Does my right hon. and learned Friend agree that as Opposition Members seem to know so little and are so unappreciative of what is being done to help the inner cities, the money would be well diverted to authorities that would put it to good and proper use?
    Mr. Howard: I understand the feelings that make my hon. Friend say that, but at least Conservative Members recognise our responsibility to the people who live in the inner cities and we are determined to discharge those responsibilities, despite the misinformation and lack of co-operation from the Labour party.
    Mr. John Marshall: Does my right hon. and learned Friend agree that his inner city strategy depends in part for its success on efficiency and honesty in local government? Lambeth, Liverpool, Sheffield and Hackney—that roll of dishonour is a cause of great shame to this country. Do we not need a wide-ranging inquiry into local government corruption?
    Mr. Howard: My hon. Friend makes a telling point. In the light of his remarks it is hardly surprising that the Labour party do not even dare to hold their local government conference this year. It has been cancelled.
    Mr. Vaz: For the Secretary of State's information, we have just had the local government conference. Why does not the Secretary of State have the courage to admit that his inner city policy is in a state of utter chaos? Will he

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    assure the House that if the 57 urban programme authorities fail to raise the £500 million which he says that they will raise—and which the Chancellor told me that they would raise—the Government will be prepared to make up that shortfall for the local authorities concerned? Does he not understand that continual cutting of urban aid will lead to greater social deprivation and the destruction of local communities and will further increase the already high level of crime in our inner cities? What is he going to do about that?
    Mr. Howard: Of course, I shall not give the hon. Gentleman the absurd assurance that he requests. If the Government automatically underwrite any shortfall, what incentive will local authorities have to make use of their ability to spend their capital receipts? What the hon. Gentleman and his party must understand is that local authorities have an important part to play and important responsibilities to discharge. We are making available to them the means to discharge those responsibilities. I hope that local authorities will take full advantage of those opportunities.
    Mr. Streeter: Is my right hon. and learned Friend aware that the £1.8 million recently granted to the city of Plymouth under the urban partnership fund is extremely welcome? The money will be used by the local authority, in partnership with the private sector, to breathe new life into inner city districts. Is my right hon. and learned Friend further aware that that is exactly the sort of development to which his policy is leading?
    Mr. Howard: My hon. Friend is entirely right. When I visited Plymouth a few weeks ago I was delighted to see for myself the tremendous progress being made there and the potential that exists for further progress. I congratulate my hon. Friend and all those in Plymouth who are co-operating with the Government to make the most of the opportunities that are undoubtedly being made available to them.

    Citizens Charter
    Mr. Pope: To ask the Secretary of State for the Environment if he will make a statement on the progress local authorities are making to meet the service standards objectives set down in the citizens charter.
    Mr. Howard: Large numbers of local authorities are now publishing local charters based on the citizens charter's principles of good public service and responsiveness to public needs. Those, together with the chartermark scheme and the Audit Commission's work on local government performance indicators, will greatly help improve quality in the delivery of local services. I shall be writing to the leader of every council very shortly with details of this year's chartermark scheme inviting them to apply.
    Mr. Pope: Does the Secretary of State agree that there is little point in issuing citizens charters when local authorities simply do not have the resources to implement them? Is he aware that, even in Tory-controlled authorities such as Ealing, cuts are now biting into core services such as day nurseries, play group, and mobile library services? Even mental health day centres are threatened with closure in Tory-controlled Ealing. What use is the citizens charter to such services?
    Mr. Howard: I do not agree with the hon. Gentleman. The citizens charter is about making public services more efficient and more responsive to the public within existing resources. I fear that it is typical of the hon. Gentleman and his party that they think that the only way to improve services is to spend more money. They do not have faith in local government and do not believe that it is possible for local authorities to improve their efficiency within existing resources—we do.
    Sir Anthony Durant: Does my right hon. and learned Friend agree that many local authorities—many of them Labour controlled—do not provide custodial places for young people? They provide places from which the young people can easily get out and reoffend, but they do have the powers to provide custodial sentences.
    Mr. Howard: I agree with my hon. Friend. Our hon. Friend the Parliamentary Under-Secretary of State for Health made that point to devastating effect during Question Time yesterday when he spoke of the enormous gulf between the words of the Opposition Front-Bench spokesman on law and order, the hon. Member for Sedgefield (Mr. Blair), and the actions of Labour-controlled local authorities.

    Local Government Finance
    Mr. Corbyn: To ask the Secretary of State for the Environment what is the proportion of local government spending in Greater London provided by central Government in the current year; and what was the figure in 1979–80.
    The Parliamentary Under-Secretary of State for the Environment (Mr. Robin Squire): The proportion of estimated local government expenditure in Greater London financed by central Government grant in 1992–93 is 68 per cent., and a further 21 per cent. is financed from redistributed business rates. The earliest year for which broadly comparable figures are available is 1981–82, when central Government met 44 per cent. of local government expenditure.
    Mr. Corbyn: Does the Minister accept that London has a number of serious problems that arc not sufficiently met by central Government funding? Some 62 per cent. of Britain's homeless people live in London, there are high and rising levels of unemployment in inner city areas and the administration of local services in London is more expensive than in the rest of the country. In addition, London has a capitalwide concessionary fares scheme to enable pensioners to travel free around the city. All those factors are extremely expensive. Will the Minister explain why he did not accept the proposals of the Association of London Authorities and the London Boroughs Association for adequate funding of London's local authority services and has instead encouraged the massive cuts presently taking place?
    Mr. Squire: I think that my answer exploded in the hon. Gentleman's face because it demonstrated, first, that in the past 10 years London has done very well out of grant distribution. That is not only my opinion because the list of authorities that receive grant show that the authority that he represents, Islington, has the fifth highest amount of support per head of population of all authorities. The problem is not grant; it is that Islington and one or two

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    other councils do not collect money in the first place. Islington's latest figures for the nine months to 31 December show that only two authorities are worse. If the figures were improved, that is where such authorities would get more money for funding.
    Dame Angela Rumbold: In view of my hon. Friend's figures about the funding for London and the fact that transitional relief in London will be relatively high, does my hon. Friend agree that Londoners, and especially my constituents in Labour-controlled Merton, should be able to expect adequate services and relatively low council tax bills in the coming year?
    Mr. Squire: My right hon. Friend is absolutely right. The system that we are introducing in April in co-operation with local authorities, which have been very helpful, will ensure that in London, as in the rest of the country, people will not face excessively high bills. I am sure that the transitional relief scheme will be welcomed in my right hon. Friend's constituency.

    Area Cost Adjustment
    Mr. Nigel Jones: To ask the Secretary of State for the Environment when his review of area cost adjustment will be complete; and if he will make a statement.
    The Minister for Local Government and Inner Cities (Mr. John Redwood): We have begun the review. We aim to complete it before the end of the year. It will be discussed during the debate on the general settlement.
    Mr. Jones: I thank the Minister for that reply, which is partially helpful. Is he aware that there is widespread concern in historically low-spending areas that the workings of area cost adjustment combined with the inaccuracies of standard spending assessments are leading to severe cuts in services? For instance, did he see the chief constable of Gloucestershire on BBC "Newsnight" on Monday who said that he had to keep 40 officer posts vacant so as to meet this year's spending round? That shows that the Department's spending limit does not match the establishment required by the Home Office. What has the Minister to say to Conservative councillors in Gloucestershire who two weeks ago decided to set a budget—[Interruption.]
    Madam Speaker: Order. This is a good opportunity to inform the House that I want brisk questions and equally brisk answers.
    Mr. Redwood: I am glad that the hon. Gentleman thinks that my answer was partially helpful. I think that it was much more than partially helpful; it was very helpful. The hon. Gentleman should make his representations at the time on the issue that worries him. I say to Gloucestershire, "Go and look at Hampshire." It is setting the lowest council tax of the shire counties so far, recruiting more than 700 additional staff for the new responsibilities and showing that if affairs are well run it is possible to operate within the money available and do a good job for local citizens.
    Madam Speaker: I call Mr. Spencer Batiste to set an example.
    Mr. Batiste: When my hon. Friend considers the mythology—[interruption]—methodology of the standard spending assessments to what extent will he consider it appropriate to include in the criteria the performance of local authorities compared with the standards being set under the various criteria established by the citizens charter?
    Mr. Redwood: That is a very interesting idea and I think that my hon. Friend's slip was quite deliberate. I reassure him that I am no student of myths, but I have had to peregrinate the ways of the standard spending assessments in order to do this job. I agree that we want accountable, good quality local services from accountable, good quality councils and I shall take my hon. Friend's idea on board when we conduct our review.
    Mr. Robert Ainsworth: Does the Minister accept that some of the questions about local government service depend to a large degree on a level playing field? Does he agree that the area cost adjustment was introduced to get the Government off the hook on which they put themselves with the poll tax and their supporters in the home counties? It is a deliberate distortion of the basis of local government finance and the Minister should take the opportunity to put it right.
    Mr. Redwood: I should like to know whether it is official Labour policy to take away the area cost adjustment. Do Labour Members want to take all that money from inner London? If so, let them tell the House and tell me, and we shall regard it as a representation for this review.

    Council Tax
    Mr. Harry Greenway: To ask the Secretary of State for the Environment how many local authorities have so far set their council tax for 1993–94; at what average level; what is his current estimate of arrears of unpaid community tax; and if he will make a statement.
    Mr. Redwood: Press reports of 193 local authorities have been monitored by the Department of the Environment. So far, the average headline tax per dwelling of those authorities before transitional relief and benefit is £450. That compares with an average community charge per household in the current year of £486 before transitional relief and benefit. The Government estimate that at the end of December 1992 authorities were owed £1,400 million of community charge relating to the period from 1990. I hope that they will make due speed in collecting it because that will be good news for their taxpayers and for the services that they provide.
    Mr. Greenway: Will my hon. Friend confirm that the level of uncollected community charge is roughly equal to the level of rates that were not collected and that this is particularly true in the borough of Ealing, where people fear the Labour party in local government? Will he tell that to the hon. Member for Coventry, North-East (Mr. Ainsworth)? The Labour party had better learn its history: it imposed a 65 per cent. rate increase in a single year upon the good people of Ealing and set up a disgraceful administration from which we are still trying to recover. Labour cannot and has never been able to run local government efficiently.
    Mr. Redwood: It is certainly true that it is the Labour authorities which are bad at collecting money. Some of them have had to think about job losses and reduced services because they are not collecting the money that they are owed. That is the money which we need for local services.
    Mr. Straw: Will the Minister confirm that the figures that he gave of average levels of council tax imply a level of band D across the country of about £550? Will he also confirm that that is £125 above the predictions,made by the previous Secretary of State, the right hon. Member for Henley (Mr. Heseltine), before the election, even allowing for inflation, since he predicted the figure of £400? Contrary to the constant assertions of the Secretary of State, were not these pre-election predictions? Will he confirm that the former Secretary of State said that the figures in the tables represented bills once the council tax had been put in place and that the only qualification given was that the council tax bills this year would be lower than in those predictions? Why is it that, thanks to the incompetence and parsimony of the Government, council tax bills will be at least £125 higher than the Government predicted before the election?
    Mr. Redwood: The Government have never made forecasts of the level of council tax for the year of introduction. I have made no forecast and my right hon. and learned Friend has made none. We have always said that we would keep the House informed when councils set their levels of tax and that is what I have done today. The hon. Gentleman does not like it, because it is coming in much lower than he expected. That is good news for people round the country and good news for local government.
    Mr. Sumberg: As the hon. Member for Blackburn (Mr. Straw) recently executed a neat U-turn when he told Tribune that the underlying principle of the council tax was about right, will my hon. Friend agree that any Labour local authority that cannot set a reasonable level of council tax cannot knock the system and has only itself to blame?
    Mr. Redwood: My hon. Friend is right. From the figures that we have seen so far, it is noticeable that the highest taxes are set by Labour authorities and the lowest by Conservative, even though Labour councils get far more grant on average than do Conservative councils. Of the county councils, Hampshire is the lowest at £328 and Lancashire, which is Labour controlled, is the highest at £472. Of the shire districts, Derwentside is £212 and Wellingborough, which is Conservative, is minus £174, because it is so good at budgeting, selling assets and controlling costs that it is putting money back into local taxpayers' pockets.
    Mr. Skinner: While we are on the subject of paying back taxes and poll tax in particular, why does not the Minister send a message to Her Majesty the Queen reminding her that she never paid any poll tax and asking for it retrospectively? He can add a PS and ask for the 40 years' back payment of income tax that she has never paid either.
    Mr. Redwood: As the hon. Gentleman well knows, the House decided that Her Majesty would have no liability for that tax, but she has offered to pay the council tax. I am sure that that will be paid in due time in the way the hon. Gentleman expects.
    Mr. Butcher: Does my hon. Friend agree that one possible reason for future variations in council tax will be the major variations in staffing and manning levels and the efficiency of local authorities? There is a grave suspicion that some local authorities are seriously overmanned, while operating identical services to others which are not. May we have clear management information on which people can make judgments on, for example, the number of employees per thousand of population, so that people may be better informed about the efficiency of their councils?
    Mr. Redwood: Much of this information is available in local areas and it is a proper matter for local debate in council chambers. I am sure that Conservative councillors in opposition will make clear how inefficient the worst Labour councils are and how much money is being wasted. It will cost about £100 per household more next year to live under a Labour council than under a Conservative one. I am sure that the electorate will take note and do the obvious thing.

    Standard Spending Assessment
    Mr. Bayley: To ask the Secretary of State for the Environment if he will make a statement on the standard spending assessment for the city of York.
    Mr. Robin Squire: The standard spending assessment for the city of York for 1993–94 is £11·066 million. This represents an increase of 2·1 per cent. on the comparable figure for 1992–93, which is close to the average for all shire districts.
    Mr. Bayley: Does the Minister accept that the increase in SSA for York is based on the increase in population, which the census revealed, of 2·1 per cent., leaving 0 per cent.—not even the rate of inflation—for services? Does he accept that if York city council even spent up to the capping limit, it would have to cut its services by £1·9 million? District councils as well as councils in metropolitan areas are being knocked for six by spending cuts, in total defiance of what the Government said in their election manifesto—
    Madam Speaker: Order. I have already appealed for brisk questions and brisk answers. I find it very disappointing when my pleas, in order to be helpful to hon. Members, are ignored in this way. Will the hon. Gentleman please put his point directly now?
    Mr. Bayley: How does the Minister justify such cuts to my city council?
    Mr. Squire: I have already explained that the increase for York council was roughly the same as the average for shire district councils. I am sure that the hon. Gentleman welcomes the fact that the assessment reflects the current population and thus ensures that the council gets more money. Let me be clear. York's expenditure in the current year is some £16·2 million, which is £5·4 million more than the SSA—in other words, it is using reserves. In contrast, last year–1990–91—expenditure was £1·3 million less than the SSA. The hon. Gentleman must look closely to the council to behave more responsibly.

    All Ages Social Index
    Mr. John Evans: To ask the Secretary of State for the Environment if he will pay an official visit to St. Helens metropolitan borough council to discuss the all ages social index.
    Mr. Robin Squire: My right hon. and learned Friend has no immediate plans to visit St. Helens. However, we are aware of, and have carefully considered, all the concerns of St. Helens about the revenue support grant settlement for 1993–94. As the hon. Gentleman knows, I met a delegation from St. Helens on 7 January when these were discussed.
    Mr. Evans: Is the Minister aware that most people would condemn the refusal of the Secretary of State to come to St. Helens, probably because he would have difficulty explaining to St. Helens councillors why authorities such as Kensington, Chelsea, Richmond upon Thames and Westminster are more impoverished than St. Helens? Is not it time that the Government accepted that as long as unemployment, particularly long-term employment, is excluded from the register, most fair-minded people will continue to regard the social index as corrupt?
    Mr. Squire: I am sorry to hear those comments from the hon. Gentleman. I am particularly sorry that he chose not to mention the London Labour authorities occupying higher positions in the league than those Conservative councils that he mentioned. The truth is that the SSA is applied nationally, as he knows. He is entitled to suggest that a particular element, or more than one element, should be treated differently and we shall be looking at that. In particular, we have made it clear that because of the significant changes that will occur in 1994–95 following the 1991 census figures, we will have a close look at the structure of SSA including unemployment. However, the hon. Gentleman must specify the elements that he would seek to delete in addition to that; otherwise he will simply be reducing grants for mainly Labour areas.

    Local Government (Corruption)
    Mr. Bellingham: To ask the Secretary of State for the Environment what recent steps he has taken to eradicate fraud and corruption in local authorities.
    Mr. Redwood: Prevention of fraud is the responsibility of individual local authorities and a matter for the auditor and, where the system has failed, for the police. The Government have duties and powers to enforce proper procedures for compulsory competitive tendering and my right hon. and learned Friend will not hesitate to use those powers where necessary.
    Mr. Bellingham: Why is it that, with one or two exceptions, the overwhelming majority of fraud and corruption in local government is taking place in Labour councils? [Interruption.] The Opposition do not like it because I have touched a raw nerve. Does the Minister of State agree that if Labour councillors carry on like this, many of them will lose their seats at the next local elections?
    Mr. Redwood: It is certainly true that there is financial difficulty in many Labour authorities and financial difficulty and looseness can lead to worse things. If that
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    occurs, it is important that it is thoroughly investigated and stamped out and, as my hon. Friend said, it is in the interests of the Opposition to make sure that that happens.
    Ms. Hoey: Will the Minister condemn the extraordinary antics in Lambeth council last night when Conservative councillors worked with Labour councillors who had been expelled and who are no longer Labour councillors to reject a motion that would have dissolved the direct services organisation? Why are Conservative councillors in Lambeth so complacent about the huge financial irregularities that have been found there? Did the Conservative councillors who voted last night do so on his instructions, or are they out of step with the party line?
    Mr. Redwood: Everyone knows that Labour is in control, or is trying to be in control, of Lambeth. That is just a red herring. Of course, Conservative councillors in Lambeth are not under my instructions—I trust that there is free democratic debate in that council—and they do not come to Ministers for any idea of what they should be doing.
    Mr. Bowis: Is not it a corrupt practice for elected councillors to set a community charge and then not pay it themselves? Does my hon. Friend agree that one reason for the great sense of outrage in the London borough of Lambeth is that councillors have done precisely that—and none of those councillors is Conservative? Is not it about time that a law was brought before the House to establish that any such non-payment is attached to the over-inflated expenses earnings of those same councillors?
    Mr. Redwood: My hon. Friend is quite right. It is a scandal if councillors owe money to their council, collect their expenses and then say that they will not pay on principle, just as it was a scandal when some Opposition Members did not think that they should pay those charges. I am glad that that period is passing into our history books and I trust that they will all be paying their council taxes.
    Mr. Straw: Will the Minister confirm that in an answer to the hon. Member for Norfolk, North-West (Mr. Bellingham) he said that reported fraud in 1991–92 in all 400 local authorities amounted to just £3·5 million? Is he aware that that represents one sixtieth of the £230 million of fraud and serious mismanagement reported in central Government Departments and quangos such as health authorities, which are packed with Conservative party appointees? Do not those figures show that the unelected, quango state which the Tory party has created is also the unaccountable and corruptible state?
    Mr. Redwood: A penny of fraud is a penny too much and the sums that the hon. Gentleman mentioned are large by most people's standards. He may find £3 million very little, but I think that it is a lot of money. Perhaps he should see what £3 million looks like; if it were piled up in the Chamber it would take up quite a lot of room. The problem is that much bigger sums are under suspicion or under investigation. The public wants to know what has gone on in those councils and the sooner the air is cleared the better.

    Compulsory Competitive Tendering
    Mr. Sweeney: To ask the Secretary of State for the Environment what steps he will take to ensure that all local authorities apply compulsory competitive tendering with equal rigour.
    Mr. Robin Squire: The Government have powers to ensure that competitive tendering is rigorously applied by all local authorities. We have not hesitated to use them where necessary. If my hon. Friends—or Opposition Members—know of cases in which English authorities are failing to fulfil the competition requirements of the legislation, I shall certainly follow them up.
    Mr. Sweeney: Does my hon. Friend agree that there is widespread public support for the Government's policy on competitive tendering? Will he confirm that he will take all the necessary steps to ensure that backsliding Labour authorities comply with the Government in introducing it?
    Mr. Squire: I fully agree with my hon. Friend's comments on the importance and popularity of CCT; indeed, I understand that its popularity has now spread to the Opposition Front Bench.
    My hon. Friend may be interested to know that, last year alone, my right hon. and learned Friend the Secretary of State issued 53 notices and 22 directions under the legislation, which in each case represents nearly 50 per cent. of the total issued since the legislation was introduced.
    Mr. Alan W. Williams: Does the Minister accept that the policy of compulsory competitive tendering is now in a mess and that it has always depended on private companies paying low wages—lower than those previously paid by local authorities? That is illegal, according to the European Community's acquired rights directive. Will the Minister also comment on reports that the Government may be liable to pay hundreds of millions of pounds in compensation to low-paid workers who have been cheated out of their wages over the past 12 years by the illegal policy of compulsory competitive tendering?
    Mr. Squire: I entirely reject the suggestion that the success of CCT is in any way based on poor wages and impoverished terms of employment. It is based on the need to ensure that local services are handled efficiently and effectively, whether they are providedin-house—that is, by local authority employees—or by an external contractor.
    Mr. Mans: In the light of my hon. Friend's earlier reply, will he look closely at the activities of Labour-controlled Lancashire county council in relation to competitive tendering? Will he also consider the fact that the council's lack of enthusiasm for competitive tendering—indeed, its resistance to it—is one good reason why it will set such a high council tax in the coming financial year?
    Mr. Squire: My hon. Friend makes a fair point: high council taxes—and high community charges—are often linked with inefficiencies in the way in which councils deliver their services. I invite my hon. Friend to forward to me any information that may suggest that Lancashire county council is acting in an anti-competitive manner. I promise that we shall investigate any such information very carefully.
    Mr. Henderson: Does the Minister accept that one reason why there is such confusion among local authorities about whether the Transfer of Undertakings (Protection of Employment) Regulations should apply is that, although the Secretary of State announced in the most recent environment Question Time that the directive concerned did not apply to local authorities, the Minister has been telling local authority associations that they may wish to insert in their contracts a clause saying that it does apply to them? Is not it time that not only local authorities but the public knew where they stood and that British workers enjoyed the same rights as workers in every other part of Europe?
    Mr. Squire: In his new-found enthusiasm for CCT, the hon. Gentleman has rather overlooked what my right hon. and learned Friend and I have actually said. If he is to support CCT, the hon. Gentleman must take on board the important point that each case must be examined on its merits. There is no question of a blanket inclusion or exclusion. Let me say again that if there is any question of local authorities seeking to apply such measures to each and every transaction, we shall investigate the possibility of anti-competitive behaviour.

    Litter
    Mr. Burns: To ask the Secretary of State for the Environment what assessment he has made of the operation of the litter provisions of the Environmental Protection Act 1990; and if he will make a statement.
    Mr. Maclean: The main measure of the effectiveness of the new litter laws is whether Britain is getting any cleaner. A survey by the Tidy Britain Group, one year after the laws were introduced, showed an average 13 per cent. immprovement in cleanliness.
    Mr. Burns: Will my hon. Friend join me in congratulating Chelmsford borough council on the way —both proactive and reactive—in which it is pursuing litter louts througout the borough by appointing litter wardens? Does he agree with Mr. Sadler, the council's director of environmental services, who believes that, provided that the laws are fully enforced and the necessary powers are used to the ultimate extent, a deterrent is created and people are prevented from becoming the litter louts that they might otherwise become?
    Mr. Maclean: I admire the way in which my hon. Friend speaks up for Chelmsford with a Basildonesquetype passion. Of course, I congratulate Chelmsford on the excellent way in which it has implemented our litter laws and I call on other local authorities to respond in as positive a fashion. My hon. Friend is right to suggest that the people of this country now have greatly enhanced powers to insist that their councils keep their areas clean. We shall look again to make sure that enough people know about their new rights and are prepared to exercise them.
    Mr. Hardy: Is not Britain still the scruffiest, most litter-ridden country in Europe? Whatever the Tidy Britain Group may say, and splendid though its work may be, millions of our fellow citizens are ashamed of the state of our land.
    Mr. Maclean: No, I reject that entirely. Even if the hon. Gentleman thinks that some parts of the country are not as tidy as they should be, the way in which he expressed his view will do nothing to encourage the millions of people who are keeping the country clean. We need to give those people more positive encouragement, not denigrate their efforts. I happen to have with me a paper issued by the Tidy Britain Group which gives details of the results of a survey that the group conducted last year in capitals throughout Europe. London came second only to Berne in Switzerland for tidiness and cleanliness. I congratulate Londoners on keeping their city tidy. I hope that they will keep up their efforts, but without becoming too boring.
    Mr. Oppenheim: Would not the workings of the Act and, indeed, the lot of refuse collectors be facilitated if councils themselves were to refrain from producing rubbish such as Derbyshire county council's notorious and discredited political newspaper, Insight, which finds its way instantaneously into hundreds of thousands of bins all over the county? Would not the county council be best advised to stop wasting hundreds of thousands of pounds on such rubbish and instead spend it on reinstating hundreds of teachers whom they are threatening with redundancy—[Interruption.]
    Madam Speaker: Order. The points that I made earlier apply to the entire House.
    Mr. Maclean: My hon. Friend is right. It is a pity that the paper to which he referred is being chucked in rubbish bins, as it could be properly recycled. However, I should be worried to use paper recycled from anything published by Derbyshire county council. I can think also of a few Sunday newspapers that would be better recycled than read.

    Urban Programme
    Dr. Berry: To ask the Secretary of State for the Environment if he will make a further statement on the effects of the abolition of the urban programme on his inner city strategy.
    Mr. Howard: I refer the hon. Member to the answer I gave the hon. Member for Bristol, East (Ms. Corston) earlier today.
    Dr. Berry: Would the Secretary of State care to reconsider the reply that he gave to my hon. Friend? Can he confirm that urban programme funding for Bristol has been cut drastically in recent years? Does he accept that the Government's continual changing of policy towards inner city areas poses a problem for local authorities, which, like the one in Bristol, are trying to plan urban regeneration?
    Mr. Howard: In deference to your rulings, Madam Speaker, I shall avoid repeating what I said earlier to the hon. Member for Bristol, East. On the question of changing the approach, we think that it is part of our responsibility constantly to look at how resources may be made available and may be made to work most effectively in dealing with the problems that arise in the inner cities. That is why we are determined to get away from the old process whereby money was made available to local authorities as a matter of routine, was taken by them as a
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    matter of routine and was spent by them as a matter of routine—a process that did not produce the results that should have been produced.

    Housing Market
    Sir Fergus Montgomery: To ask the Secretary of State for the Environment if he will make a statement on the effect of the housing market package announced in the Chancellor's autumn statement on the housing market.
    The Minister for Housing and Planning (Sir George Young): We now expect housing associations to exceed their original target of 16,000 purchases by well more than 1,000. Sixteen thousand six hundred and sixty six purchases have already been approved and more than 5,700 purchases completed, so nearly 6,000 homeless families have already benefited from this initiative. In addition, cash grants will enable 3,500 housing association and local authority tenants to become home owners, freeing their current homes for homeless families. Taken together with the recent substantial fall in interest rates, this package should certainly have a positive impact on the housing market.
    Sir Fergus Montgomery: Does my hon. Friend agree that the £580 million allocated to the Housing Corporation to enable housing associations to buy 17,000 properties must, of necessity, help to get the housing market moving again?
    Sir George Young: My hon. Friend will be pleased to learn that the Royal Institution of Chartered Surveyors came to the same conclusion: that the steps that we have taken have helped to restore confidence in the housing market and that, to use its words, the fundamentals for recovery are now in place.
    Mr. Raynsford: Does the Minister accept that the properties acquired under the housing market package, although welcome, will not be sufficient to keep pace with the increased number of repossessions since the package was announced in the Chancellor's autumn statement? Does he recognise that a far more energetic housing programme is required if we are to meet the needs of the badly housed and the homeless? When will he accept that local authorities should be able to use their accumulated capital receipts for housing purposes, as he himself argued 10 years ago?
    Sir George Young: I regret the hon. Gentleman's rather grudging response to the substantial injection of money into the housing market in the autumn statement, which will enable some 17,000 families within a period of four months to move into decent accommodation. As for repossessions, the hon. Gentleman will know that the recent figures for court orders showed a substantial reduction of about 23 per cent. As interest rates fall, the pressure on home owners will, of course, be reduced substantially.
    Sir Michael Neubert: While recognising the beneficial effects of the autumn statement measures on the housing market, may I ask my hon. Friend whether there is any encouraging evidence of increased activity in new house building?
    Sir George Young: The reduction in base rates from 15 to 6 per cent. dramatically alters the terms of trade for

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    house purchase. That fact, coupled with the reduction in house prices over the past three years, means that home ownership is now a much more practical and attractive proposition and I am sure that builders will take heart from that.
    Mr. Battle: It strikes me that the Minister is having difficulty convincing his colleagues of any movement in the housing market. Will he inform the House how many housing associations have bought only semi-developed sites as opposed to complete homes which, in practice, breaks the Government's instructions for the package and will mean that the number of homes that he boldly claims will be available are not yet built? People in desperate need cannot camp on the footings of speculative sites bought with public money. What has happened to the Government's policy of buying empty repossessed houses?
    Sir George Young: The hon. Gentleman is totally misinformed. The housing market package is aimed at houses which will be occupied by the end of March. There is no question of our buying houses that are half-completed.
    Mr. Hendry: Does my hon. Friend agree that, taken together, policies such as having housing associations as managing agents, the rough-sleeping initiative, the flats above shops initiative and the Government's task force for providing new uses for empty properties owned by the Government amount to the most concerted effort ever to tackle homelessness and are a clear demonstration of the Government's determination to tackle the problem?
    Sir George Young: I congratulate my hon. Friend on summarising a range of attractive and effective housing policies which are bringing decent homes within the reach of more and more people.

    Energy Review
    Ms. Lynne: To ask the Secretary of State for the Environment what steps he is taking to ensure that the Government's energy review will fulfil the environmental commitments made at Rio de Janeiro last year.
    Mr. Maclean: The coal review has been the subject of full consultation between my Department and the Department of Trade and Industry. The hon. Lady must await the forthcoming White Paper, but I can confirm that
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    the Government remain fully committed to meeting the United Kingdom's international environmental obligations.
    Ms. Lynne: Can the Minister guarantee that everything in the energy White Paper will meet the commitments made by the Government at the Rio summit?
    Mr. Maclean: I thought that I just said so, but let me reaffirm it in different words: whatever energy mix the White Paper might recommend or suggest, the United Kingdom remains fully committed to meeting the international obligations to which we signed up in Rio. We shall meet our targets, whatever the fuel mix.
    Mr. Clifton-Brown: The convention on climate change is designed to stabilise our CO2 emissions by the year 2000 to the levels that existed in 1990. Will my hon. Friend confirm that, as coal is almost pure carbon, unless there is a satisfactory review of the amount of coal we burn, it will be impossible for us to meet our international obligations?
    Mr. Maclean: No, I do not accept that. I accept that coal is high in carbon. It is also high in sulphur dioxide. Nevertheless, I am confident that we shall be able to meet our international obligations, irrespective of the fuel mix that we decide to use. I admit that our targets will not be easy to reach and that things will be rather tough in the next few years. That is why we must make sure that we get them absolutely right. Some fuel mixes are slightly easier than others from the point of view of meeting targets, but, whatever the mix, we are committed to succeeding.
    Ms. Short: Is the hon. Gentleman aware that Britain could do much better in reducing global warming? Will he look at Labour's recently produced policy on energy conservation? At present, the energy generators make money by selling more and more energy. If we encouraged them to sell insulation, we would reduce global warming, create jobs and reduce people's bills. As ours is an entirely good policy, will the Government adopt it?
    Mr. Maclean: I assure the hon. Lady that I have looked at it closely. I hope that Labour Members will talk more and more about it because it represents a thoroughly uneconomic policy. The costs that they envisage to bring about the small benefits that they perceive are nonsensical, well thought out and well intentioned though it may have been. We are determined to reduce the wastage of energy in this country, and I believe that there are better economic models to follow than Labour's policy of double glazing for all.

Points of Order
Madam Speaker: It being 3.30, I now close the Ballot for Notices of Motions for Friday 12 March 1993.
3.30 pm
Ms. Glenda Jackson: On a point of order, Madam Speaker. I would be grateful for your advice. Yesterday, the hon. Member for Basildon (Mr. Amess) sought the leave of the House to present
"a Bill to prohibit the use of techniques designed to influence the sex of a foetus at conception; to amend the Abortion Act 1967; and for related purposes".—[0fficia1 Report, 23 February 1993; Vol. 219, c. 769.]
Such leave, on a Division, the House denied. Today's Order Paper reveals that the hon. Gentleman has placed a Bill behind the Chair precisely the same in its wording, apart from the fact that he has dropped the clause to amend the Abortion Act 1967. Does that not contravene what is said in Erskine May, page 468(d)? If so, should not the hon. Gentleman be asked to remove the Bill from behind the Chair and, equally, to apologise for attempting to subvert the will of the House?
Madam Speaker: I am always fascinated by the way that we in this House have something new to learn every day. I admit that the presentation of a Bill so similar to the one which the House refused leave to introduce yesterday caused me great surprise this morning.
I have in consequence satisfied myself that no rule has been broken. Our rules prohibit the presentation of a Bill with the identical long title to one already refused leave and the presentation of a Bill which contains substantially the same provisions as one defeated on Second Reading.
Since neither of those considerations applies, the hon. Member for Basildon (Mr. Amess) is within his rights in presenting the revised Bill. Naturally, I make no comment on whether his doing so is likely to serve any useful legislative purpose.
Mr. Bruce Grocott (The Wrekin): On a point of order, Madam Speaker. While the Secretary of State for the Environment is still in his place, may I seek your guidance, and perhaps protection, for hon. Members?
You may have noticed that during Question Time, without any notice to me or any other hon. Member, question 3 was linked with question 9, which meant that my question, No. 9, was answered virtually at the start of Question Time instead of at about 3 o'clock, when one would have expected it to be answered.
I appreciate that humility is foreign to the nature of the Secretary of State and that he failed to apologise to the House for imposing the poll tax. May we ask him to give a simple apology, which is all I request, and an undertaking that in future hon. Members will be protected and will be told clearly when questions are to be linked?
The Secretary of State for the Environment (Mr. Michael Howard): Further to that point of order, Madam Speaker. I apologise to the hon. Gentleman for not giving him notice that I proposed to link the two questions. Fortunately, as he was in his place, he does not appear to have suffered any detriment—but I give him the apology for which he has asked.
Mr. Andrew F. Bennett: On a point of order, Madam Speaker. You have just
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commented on the practice of introducing behind the Chair a Bill similar in form to one that has been defeated as a ten-minute Bill.
Will you consider the way in which private Members' Bills have been introduced during this Session? One or two hon. Members appear to be trying to take advantage of the proceedings of the House to gain publicity for their Bills without being prepared to accept the consequences of a vote in the House. I suggest that, if an hon. Member presents a Bill under the ten-minute rule and leave is refused, it is illogical for the House to agree to the costs of printing, publishing and, in some cases, distributing many copies of that Bill. If that is not an absolute breach of the rules, it appears to come very close to misuse. I suggest to you that it may be helpful for the Procedure Committee to consider the issue.
Madam Speaker: The hon. Gentleman has hit the nail on the head with his final comment. The matter is indeed within the terms of reference of the Procedure Committee.
Mr. Derek Enright: On a point of order, Madam Speaker. I am astounded that the President of the Board of Trade is not here, and I wonder whether you can assist me. In reply to a question of mine, the President of the Board of Trade informed me in the House that Grimethorpe and Houghton pits were loss makers, yet from the Boyds report published this morning I gather that that is not the case. Has the President of the Board of Trade written to you asking to apologise to the House for the misinformation, and to announce that Grimethorpe will be reopened immediately?
Madam Speaker: I have had no indication that any Minister seeks to make a statement today.
Mr. Dennis Skinner: On a point of order, Madam Speaker. This concerns the decision already made on the action of the hon. Member for Basildon (Mr. Amess). In introducing his Bill yesterday the hon. Gentleman asked that leave be given
"to bring in a Bill to prohibit the use of techniques designed to influence the sex of a foetus at conception".
He said that that was the sole intention of his Bill, yet today he has introduced another Bill prohibiting
"the use of techniques designed to influence the sex of a foetus at conception; and for related purposes."
That seems to be pretty much the self-same Bill.
"Erskine May" says on pages 468 to 469 that a Bill should not be proceeded with
"if it contains substantially the same provisions".
I know that you have already considered the matter, Madam Speaker, but those of us who have examined the Bill and listened to yesterday's debate, and noticed the title of today's Bill, are drawn to the conclusion that the hon. Member for Basildon, having been defeated yesterday, is trying to introduce a similar Bill through the back door.
Madam Speaker: I have already given my ruling on the issue. I am well aware of pages 468 to 469 of "Erskine May". There has been a change of title and a reference to the Abortion Act has been omitted. It is perfectly in order to present such a Bill today. We must now proceed.
Dame Elaine Kellett-Bowman: On a point of order, Madam Speaker. Is it in order for the hon. Member for Bolsover (Mr. Skinner) to challenge your ruling?
Madam Speaker: It is perfectly in order for any Member to challenge my ruling. I simply stand by my ruling and we are moving on.

BALLOT FOR NOTICES OF MOTIONS FOR FRIDAY 12 MARCH
Members successful in the ballot were:

Dr. Lynne Jones

Mr. David Lidington

Mr. David Evennett

BILLS PRESENTED
  DRUGS ENFORCEMENT
  Mr. David Porter, supported by Mr. Simon Burns, presented a Bill to establish a National Drugs Enforcement Agency; to increase awareness of preventative education and counselling in countering misuse of drugs; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 26 March, and to be printed. [Bill 143.]
  HUMAN FERTILISATION (CHOICE)
  Mr. David Amess, supported by Mr. David Alton, Mr. Michael Ancram, Mrs. Angela Browning, Dame Peggy Fenner, Mr. Harold Elletson, Dame Elaine Kellett-Bowman, Lady Olga Maitland, Rev. Martyn Smyth, Dr. Robert Spink, Mrs. Ann Winterton and Mrs. Elizabeth Peacock, presented a Bill to prohibit the use of techniques designed to influence the sex of a foetus at conception; and for related purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 5 March, and to be printed. [Bill 144.]

Energy Conservation
3.39 pm
Mr. Cynog Dafis: I beg to move,
That leave be given to bring in a Bill to require all district and borough councils in the United Kingdom to draw up energy conservation plans for their areas; to require that these plans assess the works needed on residential accommodation in order to achieve energy savings of up to thirty per cent.; to require also that these plans assess the number of jobs that such a programme would create, the savings in fuel bills that different types of households might expect and the decrease in emissions of certain gases that would result; to establish a consultation process in the drawing up of these plans; to set up Regional Energy Boards to monitor and advise on the implementation of the plans; to require the Secretary of State to set a date by which all such plans must be sent to him, to draw up and publish a timetable or timetables for the implementation of the plans and to make funds available for the implementation of the plans; to give the Secretary of State power to impose a levy on fuel prices in order to raise the money; to give the Secretary of State a power to direct electricity and gas suppliers to supply certain information to councils to enable them to prioritise certain premises for energy conservation works; and for related purposes.
Thank you, Madam Speaker, for giving me the opportunity to introduce my Energy Conservation Bill.
I open my remarks by referring to the crucial need to reduce greenhouse gas emissions. The need for such reduction to combat the desperately serious problem of climate change is recognised in several of the Government's publications. The Department of the Environment document "Climate Change", published in December, shows that that Department at least takes the problem seriously. The Government are a signatory to the United Nations Conference on Environment and Development climate change convention, with its target—it has to be said, a seriously inadequate one—of reducing emissions to the 1990 level by the end of the century.
The achievement of adequate reductions must entail a drastically reduced dependence on electricity generation from fossil fuels and a shift towards renewables, as the report of the renewable energy advisory group to the Department of Trade and Industry so convincingly argues. It must entail a rethinking of our attitudes to transportation, especially road transport. Increasing demand for fuel for road transport is the main reason for the projected increase in carbon dioxide emissions by the year 2000.
However, an essential and painless starting point must be a programme for enhanced energy efficiency, including in homes. It is worth recalling that 26 per cent. of carbon dioxide, 29 per cent. of sulphur dioxide and 14 per cent. of oxide of nitrogen emissions are produced as a result of activity in the domestic sector.
Several Government initiatives, including the home energy efficiency scheme and the greenhouse programme, have been useful moves in the right direction. We now require a far more comprehensive and on-going process. That is what the activation of my Bill's provisions would bring about. The Bill proposes that district and borough councils, acting as energy conservation authorities and in partnership with regional energy boards, would draw up and implement plans for improving energy efficiency in residential properties in their areas by an average of up to 30 per cent.

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The energy conservation authorities would be charged with investigating the means by which energy savings of 10, 20 or 30 per cent. might be achieved. They would be required to assess the cost of the measures, the average savings in fuel bills in various types of residence, and the extent of the resulting reductions of CO2, SO2 and NOx, as well as the number of jobs created in the implementation of the plan. Councils would be reimbursed by central Government for drawing up the plans and making arrangements for their implementation. The improvements would be funded by a small levy on gas and electricity bills.
The Government's "Helping the Earth Begins at Home" campaign is a useful way of raising public awareness of the threat of global warming. It concentrates in particular on how each of us has responsibility to minimise damage to the environment. One of society's tasks is to create what could be termed a culture of sustainability, radically different from the throwaway culture in which we have all been encouraged, and are still encouraged, to participate.
The extensive consultation process provided for in my Bill and the drawing up and implementation of the plan would help to raise public awareness and create the new culture of sustainability. I have already referred to the contribution that such a programme would make to reducing emissions of those gases which are the main cause of the greenhouse effect. Sulphur dioxide and nitrogen oxide also cause acid rain and significant damage to health. Health gains, important in themselves, would also provide savings for health authorities. Those gains would derive not only from reduced pollution, but from reducing or even eliminating cold and damp in many homes, especially those where incomes are low.
Consumers currently waste £1 billion annually on unnecessarily high fuel bills, yet 2·5 million households are still cold and damp. Hypothermia is a disgracefully and unnecessarily common phenomenon in our society. Health gains and the resultant financial savings are difficult to quantify. However, Newark and Sherwood district council, which has conducted a programme of improving energy conservation works on 7,127 buildings, estimates that a 20-year programme of reducing damp and condensation alone would result in savings to the local health services of about £4·4 million.
The levy on the price of fuel envisaged in the Bill would amount to far less than the money saved by consumers as a result of conservation measures. Families would thus have additional spending power, which would generate economic activity and thus create jobs. Far more jobs would be created by employing people to carry out improvements to homes. A study conducted for the Association for the Conservation of Energy, which I am delighted to say gives its backing to the Bill, shows that a 10-year programme with a gross investment of £15·5 billion would generate 500,000 job-years.
That means either 500,000 jobs lasting one year or 50,000 jobs lasting 10 years. That job creation would reduce costs in unemployment benefits and in social security payments, which would in turn create even more jobs. The Bill would thus set in motion a virtuous cycle and
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would help the nations of Britain to emerge from the recession in—I emphasise these words—an environmentally sustainable way.
There would also be savings in maintenance costs. Newark and Sherwood district council has assessed the benefits of energy conservation work on 7,127 dwellings to it as landlord at £2·2 million. The Energy Efficiency Office found from a recent study of five local authorities and one housing association that landlords could save £100 to £500 per dwelling per year when all management and maintenance costs were taken into account.
We have too often tended to define an improvement in the quality of our lives solely in terms of increasing our consumption of natural resources. The need for environmental sustainability requires that we increasingly search for such improvements either without increasing our consumption of natural resources or, in the case of wealthier countries and the wealthier sectors of society, by decreasing our consumption. That can be achieved only by the application of what the Business Council for Sustainable Development no less describes as eco-efficency.
The Bill provides one example in the crucial area of energy of eco-efficiency at work. An initial capital investment would lead to the reduced consumption of resources on a long-term basis which would provide an enhanced quality of life for all, especially for the less privileged, in the form of greater comfort, better living conditions and better health. It would also create useful employment and reduce the damaging impact of human activity on the fragile environment that sustains us.
Question put and agreed to.
Bill ordered to be brought in by Mr. Cynog Dafis, Sir Richard Body, Mr. Anthony Coombs, Mr. Clive Soley, Dr. Tony Wright, Mr. Simon Hughes and Mr. Andrew Welsh.

Energy Conservation
  ENERGY CONSERVATION
  Mr. Cynog Dafis accordingly presented a Bill to require all district and borough councils in the United Kingdom to draw up energy conservation plans for their areas; to require that these plans assess the works needed on residential accommodation in order to achieve energy savings of up to thirty per cent.; to require also that these plans assess the number of jobs that such a programme would create, the savings in fuel bills that different types of households might expect and the decrease in emissions of certain gases that would result; to establish a consultation process in the drawing up of these plans; to set up Regional Energy Boards to monitor and advise on the implementation of the plans; to require the Secretary of State to set a date by which all such plans must be sent to him, to draw up and publish a timetable or timetables for the implementation of the plans and to make funds available for the implementation of the plans; to give the Secretary of State power to impose a levy on fuel prices in order to raise the money; to give the Secretary of State a power to direct electricity and gas suppliers to supply certain information to councils to enable them to prioritise certain premises for energy conservation works; and for related purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 19 March and to be printed. [Bill 145.]

The Army
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Robert G. Hughes.]
[Relevant documents: The Third Report from the Defence Committee on Options for Change: Army-Review of the White Paper, Britain's Army for the 90s, Cm. 1595 HC 45 of Session 1991–92, the First Special Report containing the Government's Reply thereto, HC 175 of Session 1992–93, and the Second Report on Britain's Army for the 90s: Commitments and Resources, HC 306 of Session 1992–93.]
Madam Speaker: Before I call the Minister I must point out that I am not minded to put a 10-minute limit on speeches today although a number of hon. Members are seeking to be called. I simply make a plea for short speeches.
3.50 pm
The Minister of State for the Armed Forces (Mr. Archie Hamilton): I welcome this opportunity to debate the Army, which is deployed in many parts of the world, protecting British interests and keeping peace on behalf of the United Nations. I will dwell, if I may, on the two operational commitments of the Army in Northern Ireland and our recent responsibilities in the former Republic of Yugoslavia.
So first to Northern Ireland, our largest and most important continuing peacetime commitment. The Government's highest priority is the protection of the United Kingdom and the lives and liberties of its citizens. In Northern Ireland it is not possible for that day-to-day protection to be provided by the police alone, as in the rest of the United Kingdom. Both my right hon. and learned Friend the Secretary of State for Northern Ireland and the Chief Constable of the Royal Ulster Constabulary regard the assistance of the Army, the Royal Navy and the Royal Air Force as essential, so that progress can be made in achieving normality throughout the Province To this end, the armed forces carry out tasks which the RUC requires them to perform, and to which their military skills are best suited. The position is absolutely clear: the armed forces act in support of the RUC, within the law. That is the proper way to deal with terrorist crime in the United Kingdom.
It is of course the continuing vile attacks of terrorists which create the need for the Army to operate in support of the RUC. In the past year, terrorists from both sides of the community have continued to show themselves ready to murder members of the community as they go about their lawful everyday business. Two incidents clearly illustrate the barbarous nature of terrorism in Northern Ireland. In January last year, republican terrorists murdered eight workmen at Teebane in County Tyrone. The following month, so-called "loyalist" terrorists murdered five people at random in a betting shop in Belfast.
Neither side has furthered its political or other aims to the slightest degree by these or other atrocities which it has committed. Nor will the two sides do so by any further terrorist acts. All they achieve is to strengthen the resolve of all civilised people that terrorism will never succeed, while they merely postpone the day when soldiers will no longer be needed to support the police on the streets of Northern Ireland.
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At present we have about 19,000 service men and women deployed in Northern Ireland. They include some 250 Royal Navy, and 1,100 Royal Air Force personnel, who make a vital contribution in operations on sea and in the air. But the main bulk of our forces is provided by the Army, with over 17,500 men and women. The core of the Army's strength is 18 major units of battalion size in the infantry role. These comprise six units on accompanied tours of around two years; six units of unaccompanied tours of six months; and six home service battalions of the Royal Irish Regiment which are permanently deployed on operations in Northern Ireland. Force levels in Northern Ireland are kept continually under review in the light of changing circumstances, and will continue to be adjusted as and when appropriate.
A major development in the last year was the formation on 1 July 1992—Somme day—of the Royal Irish Regiment, with the merger of the Royal Irish Rangers arid the Ulster Defence Regiment. The merger has been extremely successful, and the new regiment combines the best traditions of its forebears. I am confident that the regiment will continue to go from strength to strength. I remind the House that the home service element of the Royal Irish Regiment has now been on continuous operations in Northern Ireland for nearly 23 years—a unique record in the history of the British Army, and a mark of the bravery and dedication which the men and women of the regiment have repeatedly demonstrated. Soldiers of the regiment continue to face the threat of terrorist attack every day, whether they are on or off duty.
All our soldiers share this threat. In total, six soldiers were murdered in terrorist attacks in Northern Ireland in 1992, and two have been murdered so far in 1993. Three hundred and twenty soldiers were wounded or injured in 1992; the figure for 1993 to date is twenty-six.
Despite the continual risks they face, soldiers in Northern Ireland have continued to go about their duty bravely and resolutely, and with single-minded dedication. Their patience and hard work have led to many successes in the fight against terrorism. Many lives have been saved because the Army's operations in support of the RUC have deterred terrorist attacks.
Dr. Norman A. Godman: I am grateful to the Minister for giving way with his characteristic courtesy. What advice is given to the relatives and next of kin of service men and women who are injured or killed in civilian accidents such as road accidents? Are they given any advice about the possibility of taking court action against the people deemed to be guilty of causing such accidents?
Mr. Hamilton: Notifying the next of kin is done through the chain of command. There is a well-oiled machine to deal with it, and everyone accepts that it is done very well. I shall write to the hon. Gentleman about the question of notifying relatives whether they can sue, because I would not want to misinform him about the information that is given to them. It is possible that they are told that they can take action, but I shall have to look into it.
During 1992, 404 people were arrested and charged with terrorist offences, 243 weapons were recovered, and 29,131 rounds of ammunition. The Army's explosive ordnance disposal teams were called out on 1,544 occasions. They neutralised 149 terrorist explosive devices,

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containing more than 6 tonnes of explosive. I am pleased to tell the House that our soldiers' valiant efforts do not go unrecognised. In 1992, our service men and women in Northern Ireland received 356 awards for gallantry and meritorious conduct. I know from my own regular visits and briefings just how richly deserved those awards are.
We all know that the task of providing the military support which the police need in Northern Ireland is enormous. It has continued now for more than 23 years. But I can assure the House that the Army and all the armed forces will continue to provide that support until the day when my right hon. and learned Friend the Secretary of State for Northern Ireland and the Chief Constable no longer need them, and we will make every effort to make that day sooner rather than later.
I should like now to turn to the former Republic of Yugoslavia. As the House knows, we have had a field ambulance unit of 250 personnel deployed since May last year to provide second line medical support to the United Nations protection force in Croatia, and in November last year we provided an armoured infantry battalion group with a brigade headquarters and Royal Engineer and logistic support totalling 2,500 personnel to help with the expansion of UNPROFOR to provide protective support for humanitarian convoys in Bosnia operating under the auspices of the United Nations High Commissioner for Refugees, or the International Committee of the Red Cross in the case of released detainees.
During the six months of the United Kingdom's presidency of the European Communities in July to December last year we also provided some 40 Army personnel to fill headquarters and support posts in the EC's monitor mission in the former Yugoslavia. Army personnel have in addition served as United Nations military observers, undertaking a variety of tasks in Croatia, Bosnia and Macedonia.
Men and women in all three services are performing important and worthwhile tasks in, for example, the airlift to Sarajevo and the current operations in the Adriatic. I am glad to have this opportunity to pay tribute to them all. But it is of course the battalion group in Bosnia which has been most often in the news. Often operating in very severe conditions in central and north-east Bosnia, with its main logistics base at Split and its battalion HQ at Vitez, the battalion group and its Warrior, Scimitar and Scorpion vehicles have had the task of escorting humanitarian convoys, taking supplies from the UNHCR warehouse at Metkovic up country to Vitez and thence to a variety of destinations, including Tuzla and Doboj, Travnik and Zenica. More recently, United Kingdom troops have also escorted convoys from Kiseljak to Sarajevo. Since the operation began in November, the battalion has escorted a total of 279 convoys carrying 20,000 tonnes of aid.
But support to the UNHCR's effort has taken other forms, not just the provision of a close escort for the convoys where necessary, although that is done wherever convoys are operating to hitherto closed areas or close to a front line or with a high degree of danger. Support often takes the form of constant patrolling and negotiation to reduce tension and ease the passage of a convoy, and the provision of general patrolling and better communications.
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The composition of the battalion group and its support reflects the many different capabilities and skills which the task and its logistic back-up require. In addition to the armoured infantry and armoured reconnaissance capability of the Cheshire Regiment, the Royal Irish Regiment and the 9th-12th Lancers, the Royal Engineers have had a vital role to play in opening up and keeping open the supply routes in mountainous and muddy terrain and in severe weather conditions, as well as providing infrastructure and accommodation. Transport, communications, ordnance and many other specialist personnel have also been involved; and a casualty evacuation capability is provided by four Royal Navy Sea King helicopters. The battalion group will be relieved in May by the Prince of Wales Regiment and units from Germany.
The importance of the task needs no underlining. Hundreds of thousands are being kept alive by the supplies which the international relief effort is getting to a people suffering from the devastating effects of civil conflict. It is a task that is being done in difficult and dangerous conditions, including a shattered infrastructure and the ever-present dangers of the eruption of violence—risks which were brought all too starkly home by the tragic killing of Lance Corporal Edwards on 13 January.
British troops are fulfilling their United Nations mandate to use all possible means to ensure that humanitarian relief reaches those who need it in Bosnia. They are not there to confront the warring fractions. Nor are they there to fight their way through with aid convoys. They are there to provide a military escort to humanitarin aid convoys whose progress has been negotiated with all sides by the United Nations. If negotiations fail, the convoys do not run.
But worthwhile as the humanitarian operation is, it can treat only the symptoms, not the causes of the conflict. We must accept that some of the aid is inevitably feeding those directly involved in the fighting. Indeed, we have reports of warehouses of the combatants stacked to the roof with United Nations food aid. The horrors of ethnic cleansing continue apace—a matter of great concern to our troops who know that they can do nothing to prevent it. We must, therefore, continue to give our full support to the international conference on the former Yugoslavia in its efforts to help the parties reach a lasting political settlement.
It is natural, against the background of the Army's operational deployments in the Balkans and in Northern Ireland, and of its other emergency tour plot commitments to Belize, the Falkland Islands and Cyprus, that our plans for the size of the British Army should once again come under critical examination, but I should like to consider that in the context of our overall defence policy.
We have seen some dramatic changes in the security of western Europe in general and the United Kingdom in particular. The Warsaw pact no longer exists and the Soviet Union has disintegrated. In addition, the rundown of our garrison in Hong Kong further reduces the commitments of the three services, the Army in particular. Our plans parallel those of North Atlantic Treaty Organisation allies and the countries of the former Warsaw pact. Indeed, some of our allies—Germany, Belgium and the Netherlands, for example—are contemplating manpower reductions of the order of 50 per cent. —very much larger than our own.
As the House knows, Britain spends more than the average of our European partners on defence–4 per cent.

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of GDP compared with a NATO average of 2·9 per cent. —and there are good reasons for that. We have excellently equipped armed forces who are all volunteers and demonstrate a professionalism in their job which is the envy of the world. We remain a nuclear power, and our possession of the nuclear deterrent ultimately underwrites the security of both Britain and our European partners. Having said that, I do not see any reason why the United Kingdom should bear an ever-increasing proportion of the financial burden when other European and north American allies are reducing their levels of defence spending.
Mr. Tam Dalyell: Before the Minister leaves the nuclear issue, will he say a word about nuclear testing? He will have seen a powerful letter to The Times signed by General Beach and other distinguished signatories putting a case against it. Some of us find it a matter of shame that we alone should go on with the so-called necessity of nuclear testing. What is the policy?
Mr. Hamilton: As the hon. Gentleman knows, nuclear testing is carried out at the facilities provided by the United States. If it is not prepared to provide us with those facilities, plainly, we cannot nuclear test. We regard it as important for the future and safety of our deterrent that we should be able to continue to test and maintain the deterrent into the future. That has always been our policy.
Mr. Andrew F. Bennett: It now appears that the United States is demanding far more for our use of that test site. Does the Minister agree that that has considerable implications for our defence estimates? Would it not be far more logical for us to follow the lead given by all the other nuclear powers and give up testing, save the expense, and make sure that the money is used for more conventional forms of defence?
Mr. Hamilton: I would take the hon. Gentleman's intervention rather more seriously if he had not been totally against all forms of nuclear weapons for as long as I have been in the House and probably for as long as he has been here. The Labour party is bitterly divided on the whole issue of whether we should have a nuclear deterrent. I never quite know how the numbers compare between those who would have no nuclear deterrent and those members of the Labour party, many of whom, including the hon. Member for South Shields (Dr. Clark), who is on the Front Bench, were former members of CND and have now become converts and believe that we should have a nuclear deterrent.
Dr. David Clark (South Shields): It is important to remember that we are discussing nuclear testing. As the Minister knows, the Americans, the French and the Russians have agreed to a moratorium on nuclear testing. A great deal of information suggests that there is no need for testing. Why do not the Government follow the other countries and accede to a ban on nuclear testing, because it is quite clearly not necessary? That is the position of the Labour party, if the Minister wants to know.
Mr. Hamilton: I am grateful to the hon. Gentleman for clarifying Labour's position. The Government regard testing as necessary. If we did not, we would not go ahead with it. As other nuclear systems are developed we have to
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be able to test them and we must be able to test improvements in safety, and so on. If that is not done, the viability of the deterrent deteriorates.
The Select Committee on Defence recommended that all future amalgamations of infantry regiments should be cancelled. Unfortunately, the Committee did not put a cost on that. I shall do so. The Committee's plans would cost an extra £200 million per annum. The Select Committee also failed to tell us how such cancellations should be paid for. Would it be by additional defence expenditure, increasing the already high public sector borrowing requirement, or by reducing the other two services? I must tell the Committee that there is no such thing as a free lunch. We shall have to look hard at our existing commitments.
Mr. Winston Churchill: It is significant that cancellation of all remaining amalgamations and suspensions of regiments would cost only £200 million a year. Redundancies, let alone unemployment benefits that would be drawn by redundant soldiers over the next two years, amount to no less than £350 million in each year.
Mr. Hamilton: Yes, but my hon. Friend wants to restore the front line of the Army. To do that we would need to continue to recruit heavily, because young men are needed. The current restructuring basically takes into account people who have served rather longer. My hon. Friend should not assume that restoring front-line infantry regiments would cause the redundancies to cease. We are talking not merely about numbers but about a career structure for the Army, and that must be taken into account. Redundancies are a one-off cost, but if we abandoned all the amalgamations that are now planned, we would face a cost of £200 million every year for the indefinite future. That is a considerable cost, and the money would have to be found from the defence budget.
Mr. Edward Garnier: My right hon. Friend will know that my constituency has one of the Army's manning and record offices. It is at South Wigston, but following my right hon. Friend's decision of 13 January, it is to be closed, with a view to all the records being moved to a central personnel centre in Glasgow. Can my right hon. Friend confirm that no firm decision has yet been taken about the location of the office? Can he give any hope to my constituents that Leicestershire will retain its army records office?
Even though the consultation period runs out at the end of the month, is there any chance still of a split site so that the Army manning and records office can be held on two sites linked with computers, as is now possible? As my right hon. Friend will understand, with nearly 200 jobs going in my constituency as a result of this decision, the redundancies will affect not only the military staff but the civilian staff.
Mr. Hamilton: I can certainly tell my hon. Friend that this is a proposal. It is the subject of consultation at the moment. It is not possible to extend the consultation period, but we will look at the possibility of a split site. No decision has been taken on this, and the rumour that we have already agreed to buy Tay house in Glasgow is not right because no decision has been taken. The consultation will continue, and we hope to be able to make a decision after the end of this month, once the consultation period is at an end.
Mr. Frank Cook: Before leaving his comments on the Defence Committee's report and his assessment of the comparative costs, one against the other, will the Minister consider that the costs we ought to bear in mind are not simply the financial ones? Some of the units that we have examined during the rundown, since the end of the cold war, have necessitated service men and women spending 260 nights out of bed in any one year. In terms of whole-time equivalence on a five-day week, 260 nights out of bed is a whole year out of bed in working schedules. When we put young people in positions of stress, where reactions can cause death very suddenly, either their own or that of other people, it is not a subject for facetious reaction but a matter of serious concern. We measure costs not only in millions of pounds but in the security of society.
Mr. Hamilton: I do not think it unreasonable that, if the Select Committee asks for some dramatic change in policy, it should put a cost on it; that is all. Change costs money, and the money must come from somewhere. It is not unreasonable to ask the Committee to suggest where it might come from. I totally accept what the hon. Gentleman says, but my right hon. and learned Friend the Secretary of State has already recognised that there is stress in the whole business of the emergency tour plot and the pressure that we are putting on our troops. That is one reason why he made his announcement, which I will come to, to add back 3,000 and move another 2,000 from the support area to relieve that problem.
However, the hon. Gentleman will also recognise, because he has been told so in Committee a number of times, that during the amalgamations the emergency tour plot is becoming much shorter than we would want but that once the whole reorganisation has been completed—
Dr. David Clark: When?
Mr. Hamilton: I am talking about 1995, which does not seem very long. At that stage we would be in a position to get back to the 24 months' emergency tour plot interval. After the announcement that my right hon. and learned Friend made, it will actually be better than 24 months, on the assumption that we have made about the commitments that we are having to undertake at the moment.
We must recognise that we cannot conceivably afford to enter future commitments on every occasion that a military option presents itself. We need to assess the extent to which our national interest is involved, the likely success of taking military action in the circumstances and the availability of our armed forces. We should not assume that, for example, the increase in United Nations peacekeeping operations over the past year implies a commensurate increase in United Kingdom participation in such operations.
New demands have been placed on our armed forces, but let me put them in perspective. It is simply not true that we are reducing the size of the Army without reducing the tasks that we ask it to undertake. The number of Army personnel based in Germany in peacetime is reducing from more than 50,000 to around 23,000. We shall have to withdraw our three-battalion garrison in Berlin by the end of next year, and our four-battalion garrison in Hong Kong by 1997. We can commit significantly less of our infantry resources to direct defence of the United
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Kingdom. These commitments have gone or are in the process of going. They far outweigh the increases that we have accepted in their place.
Mr. John Wilkinson: My right hon. Friend mentioned Germany and the reduction of Army manpower by about half. Does he realise that BAOR still constitutes the third biggest single item of budgetary expenditure under the new management strategy of £1·45 billion, and that at a time when the Russians seem likely to withdraw all their forces from the eastern part of Germany from August next year? Therefore, will he review critically our commitment of Army personnel, and Royal Air Force too, to Germany because it is disproportionate, unbalancing our budget and investing in jobs in Germany rather than in jobs in the British defence industry and British personnel at home?
Mr. Hamilton: It is vital that we make a whole-hearted contribution to NATO. Most of the troops in the ace rapid reaction corps are based in Germany and they are our main contribution to NATO. We are extremely keen that the Americans should remain committed to European defence and should keep troops based in Europe. If we were to withdraw our troops from Germany, it would not be a good signal in view of our hope that the United States should stay here and share generally in the defence of Europe. In those circumstances, it is important that we maintain our commitment to NATO.
Nevertheless the Government have always made clear that the size of our forces would be kept under review and there is no doubt that recent increases in the Army's commitments both in Northern Ireland and the former Republic of Yugoslavia, coinciding as they have with a temporary reduction in the availability of major field army units due to amalgamation and drawdown, has served to reduce emergency tour intervals and placed increasing pressure on individual soldiers and their families.
That is why my right hon. and learned Friend the Secretary of State announced on 3 February an increase in the planned strength of the Army in the mid-1990s by 3,000 to 119,000, the redeployment of a further 2,000 personnel, mainly from the support area, to front-line units of the field Army, and the retention of two further infantry battalions above the number previously planned. This represents a small but sensible adjustment to a changing world situation whcih will ensure that the Army has the flexibility and resilience to meet the challenge of the years ahead.
Restructuring is not limited to the Regular Army. In April last year we announced our plans for the future of the Territorial Army, which will continue to play an important role in the Army's structure—not least in support of the rapid reaction corps. The new organisation of the TA is based on smaller units, to provide the basis for future expansion, and upon locations with good recruiting potential. The need to retain the TA as a territorial force, drawing on its links with the local communities for support and understanding, is reflected in the wide territorial spread of units across the United Kingdom.
Mr. Tim Devlin: Before we leave the Regular Army and battalion strength, and the question of worldwide commitments, can my right hon. Friend tell us what the future holds for the Gurkhas? That is a worthwhile small unit which will be withdrawn from Hong Kong in due course. Currently the Gurkhas are not used

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in Northern Ireland, although they gave some of my colleagues and myself a very good demonstration recently of how they might play a useful role in Northern Ireland and communicate well with the local community, something which they will be keen to do. Will my right hon. Friend say what future he sees for the Gurkhas, because they are keen to be active rather than to sit in barracks in the south of England?
Mr. Hamilton: I accept what my hon. Friend says. We envisage that the Gurkhas will continue with, I think, a number of about 2,500 on a two-battalion basis, with a training element as well. We envisage them having a future based in this country once they have been removed finally from Hong Kong.
Work is in hand to examine the employment of Army reserves, both TA and individual reservists, in future operations. In particular, we are studying the changes necessary in force structures and in legislation which might permit the participation of reserves in a wider range of operations than hitherto.
Now is not the time or place to comment in detail on the Defence Select Committee's report on these matters. I welcome the Committee's interest, but I should make it clear that, while we shall, of course, continue to keep the long-term strength of the Army under close review in the light of changing circumstances, we have no current plans to make further changes to the Army's force structure. To cancel all amalgamations or disbandments of United Kingdom infantry battalions currently planned, as recommended by the Committee, would, as I have said, cost some £200 million per annum and it would also distort the balance between the infantry and other teeth arms of the Army. I do not believe that this would offer a sensible use of defence resources.
Notwithstanding the adjustment to our plans to which I have referred, we cannot achieve the size of the Army that we are aiming for by 1995 by natural wastage alone, since it will be necessary to maintain a balanced structure of ages, ranks and skills. Redundancies are also needed, although wherever possible use will be made of volunteers. As, however, there is a need to ensure the proper balance of age, skills and experience, it is regrettably not possible to rely on volunteers alone. A total of 838 officers and 2,500 soldiers are being made redundant in the financial year ending in March under phase 1, although all but 143 officers were volunteers.
As the House is aware, tomorrow morning, those who have been selected for phase 2 redundancy–1993–94—will be individually informed. Of the 1,308 officers and 5,152 soldiers, all but 628 officers are volunteers. No soldiers are being made compulsorily redundant. All are first-class people and will be a sad loss to the Army. While I am not prepared to discuss the detail of where they may currently be serving, I do want to point out that, while there have been calls in this House for personnel serving in specific operational theatres to be excluded from the redundancy programme, the Army has made it quite clear—and I agree —that we do not want any special cases.
Dr. John Reid: If I can interpret those words, will the Minister now confirm that there is a possibility that, tomorrow, serving officers under fire in Bosnia may be handed a compulsory redundancy notice?
Mr. Hamilton: There is a possibility that a small number of serving officers in Bosnia may be made
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compulsorily redundant. There is also a possibility that serving officers in Northern Ireland will be made compulsorily redundant. But if we were to change the system—[Interruption.]
Madam Speaker: Order.
Mr. Hamilton: If we were to change the system for announcing redundancies, we would not be telling those people who had volunteered for redundancy and who are extremely anxious to know whether their application for redundancy has been accepted, and in many cases if the decision were delayed they would lose money.
Mr. Mark Wolfson: I note carefully what my right hon. Friend has said. Of course, cuts in the services and compulsory redundancies are not new in British history. Is it not new, however, that when we have forces actively engaged in various theatres in the world, soldiers should still receive redundancy notices? There is widespread public concern about that.
Mr. Hamilton: We are talking about soldiers both in Northern Ireland—a number of soldiers in Northern Ireland were part of the phase I redundancies—and elsewhere, who are part of the emergency tour programme and who spend six months in a posting. If we exempt certain members of the Army from being told about redundancy, it will be very difficult to plan redundancies in the Army as a whole. As I have emphasised, most of those who have been made redundant have volunteered for redundancy.
Mr. John Home Robertson: Will the Minister give way?
Mr. Hamilton: No; I must get on.
It is quite wrong not to tell people who have applied voluntarily for redundancy whether they are to be made redundant. It is therefore very difficult to take out of those numbers the relatively small number of compulsory redundancies without snarling up the entire programme. Regrettably, as I have already said, we have a large number of soldiers serving in Northern Ireland. I find it difficult to differentiate between those who are risking their lives in Northern Ireland and those who are risking their lives in Bosnia. If we exempted them, the whole programme would be very difficult to implement.
The next step will be phase 3 of the redundancy programme. Although the precise figures are unlikely to be available for several months, the signs are that the number involved will be similar to that involved in phase 2. All compulsory "redundees" receive one year's notice, and volunteers receive eight months' notice. All those leaving the Army spend their last six months in the Army serving in the United Kingdom, if that is what they wish. The services' redundancy terms provide for an immediate pension for those with 12 years' service or more, together with a capital payment of up to 18 months' tax-free pay in addition to the normal pension benefits. Those with less then 12 years' service receive a similar capital payment and a preserved pension.
Much has been achieved in improving the support that we offer to those leaving. During 1993–94, we are making allowance for each "redundee" to attend special job search and financial briefings. Taken with the briefings available for all service leavers, 70 different types of career,

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specialist, job-finding and financial briefings will be available. The Tri-Service Resettlement Organisation will be able to process up to 90,000 applications.
At the same time, all those leaving with more than five years' service, and hence all "redundees", are entitled to 28 days of training for resettlement purposes. The service centres at Aldershot, Catterick and Portsmouth will provide training on 72 different courses, giving an annual capacity of 6,800 places. In addition, 105 MoD-sponsored courses will be available at academic civilian training organisations, with an overall throughout of 9,200 places.
The courses cover a range of subjects such as personnel management, how to run a hotel, electrical and engineering and many others. We also arrange courses for people who wish to set up their own businesses. Additionally, we offer people the opportunity—again, on full pay—to spend time with a civilian employer to gain experience of what it is like in a new organisation. Often, that arrangement will lead directly to employment for a soldier, sailor or airman with the company once he has left the services.
Our "redundees", together with others leaving at the end of their engagements, constitute a flexible, highly trained group of personnel who will be an asset to industry. Last year, we took the major initiative in promoting the launch of the corporate marketing campaign to promote the value of service personnel to civilian employers. Our theme has been "access to excellence", and the product "The best-trained work force in Britain". The campaign is being developed through further advertising, and cascading through service channels and business forums throughout the country.
Mr. Michael Colvin: Will my right hon. Friend take this opportunity to pay tribute to the work that the Royal British Legion is doing in Liverpool—and is about to do in Tidworth—in setting up resettlement bases for training not only demobilised service personnel but their families? That work is effective because it is linked with the local training and enterprise councils. Perhaps TECs elsewhere in the country could co-operate with local MoD establishments in setting up similar courses.
Mr. Hamilton: I echo my hon. Friend's sentiments, and compliment him on the role that he has played in helping the process. A number of service men's wives are being given secretarial courses and other instruction, which has also proved extremely valuable.
In addition, the job-matching activities of the three services have now been reorganised into a single streamlined organisation, the services employment network, which is free to employers.
In short, we are very optimistic about the effectiveness of what we are doing to prepare the personnel who leave us every year to move to civilian life. It is our belief that their excellent personal qualities, combined with the experience and training that the armed forces have given them, will always be in demand. Time and again, we find that ex-service men and women obtain good jobs in civilian life. That has been our experience in phase I: we understand that over 70 per cent. of those who left on redundancy have now found jobs or have moved overseas.
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A few tangible examples will illustrate that success. A former lieutenant colonel is now an information technology consultant in a leading European IT management consultancy; a former major is a manager of a water company; an ex-colour sergeant has a carpet and curtain cleaning franchise; two ex-staff sergeants are working as assistant supermarket managers; and a former corporal is a financial services consultant. I could go on, but those examples serve to show the House that our service men are leaving with relevant skills that are well recognised and appreciated by employers.
In conclusion, I wish to pay tribute to all those who serve in our regular and reserve forces, and particularly today to those who serve in the various arms and services of the Army. They are dedicated, loyal and unselfish men and women, and I have the utmost admiration for the professionalism that they display in going about their duties. Indeed, my right hon. and learned Friend the Secretary of State announced this afternoon that Her Majesty the Queen has graciously approved the award of battle honours to ships, regiments and squadrons of the three services that took part in the campaign to liberate Kuwait. For the Army, this entails the theatre honour "Gulf 1991" and the battle honours "Wadi Al Batin" and "Western Iraq".
These days, one can hardly move without seeing one opinion poll or another reporting that things are not what they were and that the British public do not hold some of our institutions in as high esteem as they used to. This is not true, however, of our armed forces, who are still held in great respect and who are a source of great pride for the British people—and rightly so.
4.30 pm
Dr. John Reid: The right of the Queen's Own Highlanders to have the battle honours of the Gulf on their flags and emblems will be greatly appreciated. The regiment may have time to put them on just before it is disbanded.
I welcome today's debate. For obvious reasons, it has taken a long time to come. However, having obtained it, we may have some prospect of debating the defence estimates for last year before next year's estimates are issued in six weeks' time. The delay is an indication of the Government's reluctance to discuss the issues, although, of course, they welcome our point of view and the reports of the Select Committee.
I begin where the Minister ended—by paying tribute to the women and men of the British Army, who, since the last Army debate, in July 1991, have taken on new and demanding tasks and, as the Minister has said, have carried them out in a dedicated and thoroughly professional manner. I have had an opportunity to meet many of them since the last debate and I do not need to tell the House that, night after night in the streets of the Province of Northern Ireland, and day after day in the cauldron that is Bosnia, they carry out their task in a manner that has become a tradition of the British Army. On behalf of the Opposition, I acknowledge the debt that we owe to those who have given their lives in the service of their country. In discussing defence, we should always remain aware of the human cost.
The Minister dealt with two operational areas—Northern Ireland and Bosnia. I shall not refer to them in detail. I shall say only that of course we support the

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Government's position in respect of the Army presence in both places—in Northern Ireland, as a necessary but insufficient condition for the resolution of the problems of that Province; in Bosnia, for the specific, limited and clearly defined mandate of the protection of humanitarian convoys. I was glad to hear the Minister say that the objectives remain the same. Despite the diplomatic moves and the events that are taking place on the military front elsewhere, our objectives remain limited and unchanged.
Perhaps, in the spirit of unity that normally pervades these debates, I should start by congratulating the Minister and his colleagues. In the past year and a half, they have achieved what all of us thought was impossible: they have brought together all three services, the Opposition parties, the Select Committee, their own Back Benchers, academic specialists, the press and almost anyone else who has cared to examine the defence issue over the past two years. The fact that the Government have reconciled the seemingly irreconcilable is testimony to the genius with which they have approached presiding over our defence. The fact that the reason for this unprecedented meeting of minds has been universal condemnation of their own policies does not in any way detract from the enormity of their achievement in this field.
Mr. Rod Richards: What, in the hon. Gentleman's view, what would be the effect of cuts in the defence budget along the lines recommended by the Labour party conference of, I understand, about £6 billion, specifically on the Army and the current missions and tasks of the armed forces?
Dr. Reid: The hon. Gentleman approaches the subject with the freshness and vigour of a new boy. He will be glad to know that I intend to deal with that precise point at some considerable length. The cut demanded by the Labour party conference, to which members of the Labour Front Bench always pay attention, was about 29 per cent. I suggest that the hon. Gentleman holds that figure in his head as I elaborate at greater length. Having mentioned the ingenuity shown by the Government on the question of "Options for Change"—[Interruption.] I assure hon. Members that I shall deal with it fully, and they will find some surprising facts in what I have to say.
The Secretary of State's statement about the regiments on 3 February was only the latest, but not the anal, instalment in one of the most bizarre policy-making exercises that the House and the country have ever seen. Let us recall the events that led up to it, so that we can elucidate exactly where the Government think that they are going.
In February 1990, the then Secretary of State for Defence, who graces us with his presence today, told the House that a reassessment of British defence policy was being conducted under the curious title "Options for Change". I say "curious" because at no time have right hon. and hon. Members been offered any options on the future of the country's security or, indeed, choices of any description. Nevertheless, the Secretary of State for Defence proceeded in February 1990.
Four months later, in July, following what must have been the fastest defence policy re-evaluation of any country in history, the Government announced the main conclusions of that process by stating that our armed
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forces would be reduced to about 255,000 regular personnel. No indication was given of the strategic thinking behind that proposal.
A year later, presumably following an exhaustive mental effort, the then Secretary of State made almost exactly the same announcement again. This time, the armed forces were to be reduced to 246,000 regular personnel, so the combined impact of the events of the previous 12 months—the collapse of the Warsaw pact, the break-up of the Soviet Union, the disintegration of Leninism, the unification of Germany, the treaty on conventional forces in Europe, and the Gulf war—was apparently equal to 9,000 soldiers.
The Government had worked that out after a year. Still nothing was said about Britain's place in the post-cold war world, about the threats that we would face or the new missions and roles that our armed forces would be asked to perform, despite the fact that two and a half to three years ago, the Labour party and the Liberal Democrats, without several hundred thousand civil servants, were clearly identifying the type of new risks that would replace the old threat from the Soviet Union and redefining the type of threat that we would face. We argued that the new threats should be the basis for the structuring of our forces, but the Government apparently found it difficult to do that. Instead of a coherent strategic assessment, we were offered bland generalisations about how the world was less threatening but more unpredictable.
In November 1991, four months after the Secretary of State's announcement, the NATO Heads of State agreed the alliance's new strategic concept. Apparently by some happy coincidence, the Government had got it just right and the United Kingdom force structures, announced four months before the NATO strategic document was outlined, fitted exactly into the new NATO strategy. No changes were needed, although NATO had changed its strategy.
Having seen the intellectual and incoherent mess that his predecessor had bequeathed him, the new Secretary of State attempted in July 1992 to paper over the credibility gaps by redefining Britain's defence roles: out go direct defence of the United Kingdom, a commitment to the European mainland, protection of the eastern Atlantic and the maintenance of a nuclear deterrent, and in come the protection of United Kingdom independent territories, insurance against external threats and the promotion of international peace and stability.
The Secretary of State seemed to operate according to some inverse logic. Whereas conventional wisdom would have us believe that the armed forces should be structured according to the requirements of strategy, we had a new doctrine from the right hon. and learned Gentleman. Apparently he believed that the strategy should be formulated according to the requirements of the existing force structure, which had been decided in advance. What else could possibly explain the chronology of events, other than a decision to base strategy on existing force structures, which, in turn, were being shaped purely by the Treasury? The other way about is the normal way of doing things when operating the relationship between strategy, tactics and structures.
But even that attempt at strategic justification of the Government's policy does not suffice, because, after all, the new roles defined in the "Statement on the Defence Estimates 1992" are only a new way of saying the old thing. For two and a half years, my hon. Friends and

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almost every defence expert in Britain have been asking the Government to conduct a full defence review. Match resources to commitments, but do not continue to cut resources while extending commitments. But there is still no indication that the Government are prepared to undertake the sort of qualitative review of Britain's military role that we desperately need.
Instead, the armed forces of the decade ahead will be exactly the same as those of the decades of the past, only smaller. It has been shown by the autumn statement that the new Secretary of State intends to follow his predecessor's example of dancing to the Treasury tune and making the rest up as he goes along.
Mr. Ian Bruce: I pay tribute to the hon. Gentleman because he is often shoulder to shoulder with me whenever jobs are being lost throughout the country in the Royal Navy and the Army, but he will know that many of the cuts will take perhaps five years to implement. He and his party may be in power in five years' time. He is clearly demonstrating his resistance to being forced by the Treasury into taking action.
Will the hon. Gentleman give an assurance that the Labour party is committed to applying the full resources necessary—whatever the Foreign Secretary says may be necessary for the requirements of defence in the world—that they would not be Treasury-driven and that Labour would maintain the spend to which the current Secretary of State for Defence is committed?
Dr. Reid: Before answering the hon. Gentleman's question, I will explain why Ministers are exclusively Treasury-driven. I am not saying that the Treasury never has an effect on any Department—[Interruption.] We know that it does; none of us lives in an unreal world, with the exception of some Ministers. They are exclusively Treasury-driven for the simple reason that present Ministers have no strategic analysis to combat Treasury pressure. If they had conducted, as a Labour Government will, a full defence review, they would be in a position to act when the bargaining starts.
If I have any responsibility at that stage, I hope that the Ministers presiding over defence in the then Labour Government would be in a position to argue against Treasury pressure if it affected the security interests of the nation. But if there has not been an analysis in the first place, when the man from the Treasury arrives and puts a gun at one's head, there is nothing one can say. Conservative Back Benchers know that what I say is correct. Indeed, the ex-Minister, who has now left the House, the redundant armed forces Minister who has now become something of a statesman and an arms dealer, also knew that.
Mr. Richards: Is the hon. Gentleman saying that he would argue the case for defence expenditure as against health service expenditure?
Dr. Reid: I shall deal—[Interruption.] I assure the House that I will answer that question to the hon. Gentleman's satisfaction. I shall also deal with the question of resources. I can answer in a nutshell by saying that nobody in Britain, and certainly none of my hon. Friends, is saying that we should increase defence expenditure—[Interruption.] Conservative Members will
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have all revealed to them. They are apparently incapable of understanding, although I have explained the position several times.
We are saying that when defence expenditure is being cut—as it has been, is being and will be—it is more vital than ever to make sure that the distribution of resources goes to shape forces that meet the modern threat. But nobody can do that unless they have analysed the risks and the threats—and that cannot be achieved without a full defence review. That is why the whole Government process has been flawed from the start. I shall elaborate shortly on the implications of that for internal distribution and in relation to the figures for which the Secretary of State has been asked.
"Options for Change" was flawed in its conception and the climbdown announced by the Secretary of State on 3 February, though welcome, does nothing to tackle the underlying problems inherent in the Government's approach. The reprieving of four regiments was a necessary step, but, as the Select Committee reported earlier this month, it will not resolve the mounting problems of overstretch in the British Army. There is a mismatch between resources and commitment. Since "Options for Change" was originally announced, the Government have added three extra tours to the British Army's emergency tour plot, two more in Northern Ireland and one in Bosnia. Sadly, there seems little prospect of those commitments disappearing in the near future, especially Bosnia, where the number of troops may even increase.
According to the Select Committee, five battalions are needed to cover each tour plot to achieve the Government's intended interval of 24 months. That means that the Government have increased the British Army's tasks by the equivalent of 15 battalions, while increasing the planned number of battalions by only two. Those are the stark figures from which Ministers cannot escape. They have increased the tasks by the equivalent of 15 battalions and have increased the number of battalions by two.
In view of that simple equation, it is clear that we are further away than ever from realising the goal of a 24-month interval for battalions carrying out emergency tours. The result will be continued overstretch, an increasing burden on the Army and the demoralisation of the soldiers. There will be an increased drop-out rate as a consequence and, therefore, increased cost.
In discussing the issue of overstretch, it is vital to recognise the human as well as the strategic consequences of the policies being implemented by the Government. The soldiers who serve in the British Army risk their lives on our behalf. We owe them, and we continually say that we owe them, a great debt of gratitude. So there is an obligation on us to ensure that their conditions of service are acceptable. Overstretch is not a theoretical or just a strategic problem. It imposes an intolerable strain on our soldiers and their families, it disrupts their lives and it saps their morale.
I fear that in the scramble for savings, the human element has been lost. When a soldier has shorter intervals between tours to Northern Ireland, when he does not have time for training or adventure training and when he has guard duty imposed on him continually—the activity which most normal soldiers hate—the morale of the Army is disrupted, and morale is the foundation on which fighting capability is based.

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The Government's U-turn was inadequate because it was prompted by a sense of political embarrassment rather than by a coherent vision of the security challenges facing the country and the appropriate responses required. It was a process, as it were, of salami slicing in reverse—the alter ego of "Options for Change". It failed the credibility test because it was a sticking plaster when radical surgery was needed.
There is in the Government an unwillingness to face realities and make hard decisions. That has been the hallmark of their defence policies, a tendency accompanied by mounting crises in the defence budget. "Options for Change" was only the ultimate manifestation of that tragedy. By cutting resources without any corresponding structural reprioritisation of commitments, the Government ducked their responsibility to our soldiers and their responsibility to provide firm leadership. By seeking to maintain existing force structures while maintaining incremental savings across the board, the Government have ended up with an unhappy compromise that is the worst of all possible worlds. So far, the Conservatives have proved themselves adept at the old Goebbels principle that people are more likely to believe a bigger than a smaller one.
Mr. Phillip Oppenheim: I admire the hon. Gentleman's skill in making it difficult for us to attack his argument. The logical corollary of what he is saying is that either we should reduce our commitments or increase our spending on the armed services. Of which is he in favour?
Dr. Reid: That is partly a corollary of what I am saying. A full defence review would ensure, first, that our resources met our commitments and, secondly, that the structure of our forces met the perceived risk.
I must explain to the hon. Gentleman that the threat used to be defined as having two parts—intention and capability. When the Soviet Union existed it was easy to define the threat. The Soviet Union certainly had the capability and people assumed that the motivation was there, too. That was a big cumbersome threat, which was easy to assess.
The Government were not prepared to listen two and a half to three years ago, when some of us said that that big threat was giving way to what were called smaller risks —flashpoints around the world, such as ethnic tensions and rivalries, border disputes and the birth of new nations. The type of force structure needed to deal with such risks is different from what was needed to deal with the big Soviet threat.
The problem is that the Government embarked on the cuts without a full defence review to analyse the changes, so they ended up by making incremental cuts. I hope that I have given a full answer to the hon. Gentleman's question.
Mr. Nigel Evans rose—
Mr. Andrew Robathan rose—
Dr. Reid: I shall give way in a while. I know that there is a group of vigorous new Members there, and they have already asked me to answer two questions, which I have yet to reach. Once I have reached those answers I promise that I shall give way again.
I was talking about the big lie. We know about the lies that we have heard before, such as that the Conservative
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party is the party of low taxation—that one sticks in the mind. Until recently, another of the big lies was that the Conservative party was the party of sound financial management—we all remember that one. Another two were the claims that the Conservative party was the party of law and order, and that the Conservative party did not devalue. We could spend all day on those big lies, but the one on which I shall concentrate today is the idea that the Conservative party is the party of strong defence.
Let us look at the statistics for which Conservative Members have asked me. We must remember that the important statistic that I mentioned was that the Labour party conference had asked for a cut of about 29 to 30 per cent. Conservative Members must keep that figure in mind, and I shall deal with it. [HON. MEMBERS: "Six billion pounds."] No, there is no absolute figure of £6 billion. That may be Conservative Members' interpretation, but if they want to attack us they should use the figure that I am giving them. Keep it in mind.
Let us look at defence expenditure under the Conservatives.
Mr. Nigel Evans rose—
Mr. Devlin rose—
Dr. Reid: No, I shall not give way, because I am courteous enough to try to reply to the questions that I have already been asked before replying to subsequent questions. I shall now deal with the very figures that the Conservatives have been demanding for two years.
Between 1979–80 and 1984–85—the first five years of the Conservative Government—defence expenditure did increase by 22 per cent. in real terms. That is why Baroness Thatcher used to glory in being called the iron lady. That sustained increase during the first half of the 1980s is constantly used as the basis of the Conservatives' claim to be the party of strong defence. Unfortunately for them, they cannot rewrite history. In reality, that increase of 22 per cent.—[Interruption.] Let me tell the young hon. Gentlemen, because I know that they are keen to learn.
The 22 per cent. increase was nothing to do with the resolute nature of the Conservative Government or their leader. The real source of the increase was the commitment given to NATO by James Callaghan and the Labour Government in 1977 to increase our commitment by 3 per cent. per annum in real terms. That commitment was honoured and was approved by the House before the Tory Government were elected in 1979. That was the source of the 1980–85 figure, and the 22 per cent. increase.
Mr. Robathan rose—
Dr. Reid: There is more, I am afraid. I am giving a full answer to the question, and then I shall give way.
Let us examine defence expenditure since 1985. That is the expenditure of which the Conservatives can genuinely claim authorship, and it will take us from 1985 until about 1997 or even 2000—the Conservatives keep telling us that they will still be in government then. Under current plans, by 1995–96 defence expenditure will have dropped by 20 per cent. in real terms over the preceding decade—a 20 per cent. cut since the Labour increase stopped.
Revealing though that figure is, if we project that trend forward into the second half of the 1990s—given the Government's intentions and their appalling fiscal ineptitude, that is a modest assumption—the defence budget will have been cut by a further 9 per cent. by the

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year 2000. I have said 20 per cent., now I am going to tax the intellectuals on the Conservative Benches by asking them to add together 20 per cent. and 9 per cent.—[Interruption.] I can hear their minds working; I can hear them stirring.
Mr. Iain Duncan-Smith rose—
Dr. Reid: I should prefer the hon. Members who asked me the question to answer mine; there would be a certain satisfaction in that. I believe that when they have thrown some pieces of paper into the basket, and have got the abacus out, they will discover that the figure for the Government's cuts in defence from 1985 to the end of the century will be 29 per cent. in real terms—exactly the figure asked for by the Labour party conference. Although we were not in power, the Conservatives were good enough to carry out the Labour party conferences resolution, and I congratulate them.
Mr. Archie Hamilton: Does the hon. Gentleman not admit that we are talking not about 1984–85 but about a Labour party conference decision made last year? It is no good the hon. Gentleman talking about reductions in defence expenditure since 1984–85, because the resolution said that defence expenditure should be reduced to the European average from last year—a cut of 27·5 per cent. from the present level. So we are still talking about a dramatic cut of £6 billion to £8 billion in the defence budget.
Dr. Reid: It really takes the biscuit for a Tory Minister to complain that the Labour party was five years too late in calling for the defence cuts that the Conservatives had started five years earlier.
I have dealt in some detail with the figures. We criticise not the fact that there has been a reduction in defence expenditure but the sheer hypocrisy of a Government who cut defence in practice while accusing other parties of wishing to cut defence in theory.
Mr. Robathan rose—
Dr. Reid: I have already given way several times, and I shall allow the hon. Gentleman to return to the subject.
As I have already proved, under the Conservative Government defence expenditure has been cut, is being cut and will continue to be cut. Only the political posturing of a Government who have come to believe their own propaganda prevents them from admitting it openly. The three Ministers sit there—the three wise ministerial monkeys: "See no cuts, hear no cuts, speak no cuts." They have talked themselves into believing the propaganda that they have pushed out.
No one denies that it was valid to expect a significant redistribution of resources following the end of the cold war, even if the rosy assumptions of 1990 look distinctly tarnished in 1993. The search for savings was necessary and the Opposition would readily have welcomed it were it not for the following facts.
First, on black Wednesday whatever peace dividend there may have been was frittered away in a matter of hours in a display of the most breathtaking financial incompetence. Secondly, the Government's policies lamentably failed to take account of the fact that, when
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resources are dwindling, it is more important than ever to prioritise commitments and target spending where it is most needed.
That is why the Opposition are prepared to support programmes such as Challenger 2 or the add-back of the infantry. Those programmes enhance the mobility and flexibility of our armed forces in dealing with the security threats that this country is likely to face. But—this refers to the second question which I have still to answer—we shall not support spending up to £3,000 million on a new sub-strategic, tactical air-to-surface nuclear weapon for which there is no clear military need and which serves no useful purpose. It is a disgrace and a disservice to our soldiers that we are spending £3,000 million on a new nuclear weapon which is not needed—while we are putting them on the dole, giving them compulsory redundancy and disbanding infantry regiments which are needed to deal with the very threats that we now face.
Mr. Michael Fabricant: Does the hon. Gentleman accept that we need a flexible response? Does he accept that, with the defeat of the Soviet Union —it surely has been defeated—the nuclear weapons of the former Soviet Union are still in place in Russia, Byelorussia, Uzbekistan and other parts of the former USSR? Does he further accept that there is an increasingly strong relationship between Iran and the southern states of the former Soviet Union, that there is the gravest danger that nuclear weapons will spread out of the Commonwealth of Independent States and that we need to keep not only Trident—to which the hon. Gentleman has not yet referred—but a flexible response to counter—
Mr. Deputy Speaker (Mr. Michael Morris): Order. That is a long intervention. I call Dr. Reid.
Dr. Reid: I am trying to think of something courteous to say. I admire the sincerity with which the hon. Gentleman puts his view.
We make our position plain. We believe that it is a criminal disservice to our soldiers who have been sacked to spend £3,000 million on a new nuclear weapon for which there is no military need. We cannot put it more simply.
Mr. Nigel Evans: I am rather perplexed by what the hon. Gentleman has had to say to the House. Are we listening to a rescinding of the Labour party manifesto commitment of 1992? The Labour party went into that campaign saying that it would cut defence expenditure in Britain to the average of the other European countries. In my constituency I have many thousands of people working at British Aerospace on the European fighter aircraft and the Tornado. Is the hon. Gentleman telling them that their jobs would go if a Labour Government were re-elected?
Dr. Reid: The only thing that was wrong with the hon. Gentleman's question was that its premise was false. I assure him that there was no such statement in Labour's manifesto. I will accompany him to the Library after my speech and get the manifesto. He will find that it contains two commitments on defence. One is to conduct a full defence review. The other is to pay whatever is necessary to defend Britain. He must not believe the propaganda that he was sent from Conservative central office during the election campaign. If the hon. Gentleman can find the phrase that he used or a pledge of cuts anywhere in Labour's manifesto, I will treat him to a dinner in the House.
Mr. Duncan-Smith: Will the hon. Gentleman give way?
Dr. Reid: I am sorry, but I want other hon. Members to be able to speak. I have given way liberally.
In refusing to make the choices that I have described, the Government are producing not a redistribution of resources but a maldistribution of reduced resources.
I was giving the reasons why we cannot take "Options for Change" seriously. The third reason is that the reductions have not been carried out in any coherent or systematic fashion. The House does not have to take my word for it. The Tory-dominated Defence Select Committee said:
"'Options for Change' regrettably fails to … provide a coherent strategic overview."
It takes an ingenuity beyond belief on the part of Ministers in a Tory Government to unite the whole Defence Select Committee against them. In an unprecedented move, the Committee has tabled an early-day motion which criticises the Government's cuts under "Options for Change". So Conservative Members need not believe me if they do not wish to, but they should at least have some respect for some of the points which have been made by their honourable colleagues in the Conservative party.
Fourthly, in some cases it is by no means certain that the proposed changes will save money or increase efficiency. I merely give one example of that. As hon. Members will know, until now recruits have done preliminary training over 21 weeks. There has been a high drop-out rate. The Government have decided to split the period of training into 11 weeks and 10 weeks at different bases. I predict now that there will be an even higher drop-out rate. The reason is one of personnel rather than theory.
Most of the drop-out among young recruits who enter the Army is a result of the shell shock of suddenly being told by some large, well-trained sergeant-major that he is their mother now. It is only with some difficulty that many young people attune themselves to that. Previously, once they had attuned themselves, they had the same sergeant-major or corporal for 21 weeks. Now, after 11 weeks they will meet an even burlier sergeant-major who will deny the earlier parentage and demand that they accept that he is their mother for the next 10 weeks.
I predict to Ministers that the scheme, presumably thought up by cosy civil servants sitting in Whitehall who have not been on a parade ground for years, will result in further and greater dropping out. It will result not in efficiency and cost saving but in further expenditure.
The Government are putting through a massive reduction in Army resources, but they are constantly adding to its tasks. First, the British Army has been charged with leading the new NATO rapid reaction corps, which came into existence in the autumn. Secondly, several of the regular battalions assigned to the rapid reaction corps will be expected simultaneously to carry out an increased number of roulement tours in Northern Ireland. That was never mentioned when we bid for the leadership of the rapid reaction corps in central Europe. Did we tell the Germans that our soldiers would be in Northern Ireland? Did we tell them that the relief of central Europe would be launched from the Falls road? I am sure that the Germans did not understand that. Ministers told us only after they had bid for the rapid reaction corps.
Thirdly, the Secretary of State pledged in May that Britain would assign additional units to carry out missions
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on behalf of an enhanced Western European Union. Fourthly, in October, not to be outdone—there is a certain rivalry between Defence and Foreign Affairs—the Foreign Secretary went one better in a game of "Anything you can stretch I can stretch further." He promised greater British participation and involvement in United Nations peacekeeping operations.
So, not content with double-hatting or even triple-hatting the British Army, the Government want to quadruple-hat them. The British Army is the only army in the world in which recruits are expected to have four heads. It is not possible to operate an army on that basis. Our service men and women deserve better. They are at the sharp end. They cannot and should not be asked to take the strain of increasing demands imposed upon them.
If the treatment of Army personnel who are to be made redundant, which was mentioned earlier, is any indication of the Government's approach, all of us in the House have a problem, but our service men and women have an even greater problem. The Minister apparently thinks that 28 days training is sufficient for someone who has served the country and risked his life and is then told that he is being made redundant. Is it not an irony that, if an officer is battered over the head by a soldier, the soldier is sent to Colchester and receives a dishonourable discharge but, while he is there, he receives three months training in a trade; but if a soldier acts in an honourable fashion and conducts himself properly throughout his service career, he receives one month's training and a redundancy slip and is sent down the road?
Has no one in the Ministry of Defence thought that there is an anomaly there? A person who is given a dishonourable discharge receives three times more training than a person who has been made compulsorily redundant but has conducted himself in an admirable fashion before discharge.
"Options for Change" revealed that at the heart of the Government's policy is a deep insensitivity to, and ignorance of, the needs of ordinary service personnel. But what else could we expect? They are the Government who, in response to calls for compensation on behalf of nuclear test veterans, said last week that it was no concern of theirs because—I quote the Minister—
"people who get older are more likely to contract cancer " —[Official Report, 9 February 1993; Vol. 218, c. 817.]
That was a breathtakingly complacent and deeply insulting remark.
The Government reject the death penalty for terrorists, but went to the trouble of coming back to the Floor of the House to reinstate the death penalty for British soldiers. So the terrorists who attack the soldiers suffer no execution, but the soldier who, under threat of losing his life, perhaps cracks for a minute, could face the death penalty. They are the Government who axe entire regiments while arrogantly refusing to justify their decision. They then reprieve some of them and refuse to apologise for getting it wrong. They are the Government who, to save money, cut short the careers of soldiers who are desperately needed, while being prepared to waste up to £3 billion on such a militarily useless project as the tactical air-to-surface nuclear missile.
If anything was needed to illustrate the Government's insensitivity, it came in their comments this afternoon on redundancies. Tomorrow, the Government will notify the soldiers who are to be made compulsorily redundant under "Options for Change". That is regrettable. What makes it

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disgusting is the fact that Ministers have refused to give an assurance that no soldier will receive a redundancy notice while on active service and under fire in Bosnia or in Northern Ireland.
This is not a partisan point. All hon. Members should protest vigorously to the Government. The prospect of a soldier in Bosnia or a soldier in Northern Ireland dying with a redundancy notice in his hand is not a prospect which any decent Member should contemplate.
The Secretary of State for Defence (Mr. Malcolm Rifkind): The hon. Gentleman is making a serious charge. Does he not appreciate that the Army believes that it would be grossly invidious for the choice of soldiers for redundancy to depend on whether a soldier happened to be serving in Northern Ireland, Bosnia, in the United Kingdom or elsewhere? Does the hon. Gentleman not also realise that soldiers are constantly moving from one theatre to another? There would be enormous resentment throughout the armed forces if it was believed that the choice of redundancy depended not on personal merit or record, but on whether a soldier happened at a given moment to be in one part of the world rather than another?
Dr. Reid: I am glad that the Secretary of State intervened rather than sitting sneering as he did earlier. How many soldiers has he asked? When he talks about the Army, he means the brass hats who are sitting in Whitehall. The Secretary of State should ask a soldier in 'Bosnia or Northern Ireland how he would feel if he was made compulsorily redundant while he was there.
Irrespective of what the brass hats say, in this country politicians run defence. We make moral decisions and the instruments of those decisions are the boys and girls whom we put on to the streets, into the valleys or into the cauldron of Bosnia. It is our obligation, not the obligation of any serving soldier, however high ranking, to ensure that we meet those obligations to our soldiers.
There will be horror among the public at the prospect that people who are risking their lives for us could be made compulsorily redundant while on active service. The Secretary of State may shake his head. Time will tell whether this is another insensitive bloomer.
Mr. Ken Maginnis: I am sure that the hon. Gentleman, like me, was astounded to hear the Secretary of State suggest that those who were being made redundant were being made redundant on the ground of merit. Are we telling those soldiers' future employers that we are getting rid of second-rate soldiers? That would be a disgraceful innuendo by the Secretary of State in the circumstances.
Dr. Reid: The hon. Gentleman has put the point as well as I could have done.
We have become heated because this is an important issue. It is also a disgraceful issue. I do not regard it as a partisan point, but as a matter of honour for all hon. Members. It is also a matter of honour that we who make the political decisions that may send soldiers to their deaths have an obligation to ensure that they have the numbers, the resources and the morale to undertake the tasks assigned to them. That is an obligation which the Government have, once again, signally failed to undertake.
5.13 pm
Mr. Tom King: It is a pretty severe test of parliamentary courtesy to have to sit and listen to the hon. Member for Motherwell, North (Dr. Reid) lecturing Conservative Members on hypocrisy when his own party manifesto, which he took some pleasure in trying to develop, said as little about defence as possible. The hon. Gentleman was right carefully to avoid the conference pledge passed by an overwhelming two-thirds majority of his party. I imagine that he was there when the conference pledged a cut of 28 per cent. The hon. Gentleman then attempted to insult the intelligence of Conservative Members with the closest thing to a parliamentary three-card trick that I have ever seen. He tried to fake the date from which the reductions were being made.
I normally enjoy the hon. Gentleman's speeches, but I profoundly disagreed with his last comments. There is a difficult challenge. The gravamen of what my right hon. Friend the Minister said is that the issue of redundancy is difficult and sad. I entirely support what my right hon. Friend said because I am in no doubt that that is the advice of the Army. It is no good talking about brass hats. They are people who have the responsibility of commanding men. If advice were asked throughout the Army, we would be told that we should be concerned not only about the people who are in Bosnia.
What about the chap who finds that he is now re-eligible because he has just come back from Bosnia? What about the chap who has been serving in Northern Ireland and who thinks that he is exempt, but who comes back, perhaps injured, and finds that he is now eligible again? In such difficult circumstances, I do not believe in political intervention. I believe profoundly—I am sure that this was the Army's advice—that the matter should be dealt with as my right hon. and learned Friend has suggested.
Another nauseous point about the speech by the hon. Member for Motherwell, North was that I had to listen, while best containing my annoyance, to his comment that he and his hon. Friends were the only people who understood what was happening in the world some time back. It is lucky that I have brought with me the introduction that I wrote for "Britain's Army for the 90s" in July 1991, to which the hon. Gentleman referred. He said that Labour understood that, although the cold war was ending, there were likely to be other risks in the future.
We said:
"with the end of rigid 'cold war' structures, risks may arise from nationalist tensions and local conflicts which could spill over and engage other countries."
We also said:
"our forces were previously structured primarily to cope with the threat of a massive surprise attack in Europe. Now they need to be designed to respond to a wider spread of risks".
Was not that precisely the point of which the hon. Gentleman sought to claim ownership? Was not that the point of which, he claimed, we were totally ignorant?
I care very much about the responsibility that I held at a difficult time in terms of the unhappy and unpleasant decisions that had to be taken in the "Options for Change" review. I shall deal straight away with the canard that the hon. Member for Motherwell, North tried to deploy. He said that the decisions were the result of no proper strategic analysis. That is a gross insult to the Chief of the Defence Staff and to all those involved in the most detailed analysis, which was built on the most thorough initial

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analysis of intelligence assessments. A huge mass of work was done to try to assess the information fully as we went through the review.
The hon. Gentleman had the decency to mention the endless work done in the NATO strategic concept. That was the base work that sought to prepare us for what we thought was the sensible level of the "Options for Change" review. I am proud of the work that was done, of its thoroughness and of the way in which it has stood the test of time.
When the hon. Member for Motherwell, North talked about "Options for Change", he dealt entirely with the issue of infantry regiments. He knows perfectly well that "Options for Change" covered the whole range of our armed forces, the whole range of our civilian establishments and the whole range of the structure of the defence estate. It set up the reorganisation of our armed services and the need to make them relevant to the future and to ensure that they were appropriate for the defence needs of our country.
Mr. John McWilliam: Will the right hon. Gentleman give way?
Mr. King: No, because I want to be brief.
The one thing about which I cared passionately was that if there was to be change that would affect many people who had been prepared to commit themselves to the service of their country, those people had to have the best possible arrangements thereafter if they were made redundant.
I pay tribute to my right hon. and learned Friend the Secretary of State and to my right hon. Friend the Minister of State for the Armed Forces. I know the very personal interest that they are taking in carrying through the programme. I trust that my next comment will not be challenged. I am proud to say that the arrangements made for resettlement, for retraining, for redundancy pay, for notice, for housing and for help with future careers are the best that have ever been put in place in this country.
Those arrangements have invited real admiration and respect and I should be surprised if they were matched by any other NATO country having to face these challenges. I hope that I take my hon. Friends with me when I say that money spent in this way is money well spent. We owe it to our service men who have been prepared to serve our country and who, for reasons beyond their control, are no longer necessary.
Mr. Frank Cook rose—
Mr. King: The hon. Gentleman has already intervened once and I wish to be brief.
This debate takes place in the midst of the reorganisation. The fact that that reorganisation is going so well is a tribute to the Army and the Ministry of Defence—whose personnel the hon. Member for Motherwell, North described as just some civil servants in Whitehall. Those civil servants are carrying through this massive reorganisation with, in the main, remarkably little outside comment.
It is not just a question of infantry regiments; it involves the combat arms, the support services, engineering services, the Army estate, its training organisation—arid of the grouping into two main support corps. There is also the Adjutant General corps. The reorganisation also involves setting up new headquarters and structures in this
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country and the massive withdrawal from Germany, where numbers will fall from 55,000 to 25,000. Bases are to be closed—it is a massive undertaking, and I commend the way in which it is being done. It will continue for several years.
That change is not taking place in an atmosphere of peace and tranquillity. While it goes on, to their great credit, our service men and civil servants are carrying out their tasks with their traditional and admirable courage and dedication in Northern Ireland. I have reason to know that as well as anyone. Now there are new commitments in Bosnia, too.
Mr. McWilliam: Does the right hon. Gentleman still think it a good idea that an artillery man should be away from his gun, not having fired it for two years; or that a cavalry man should be away from his tank, not having been in it for a year—just to pad out the emergency tour plot in Northern Ireland, which is still to be reduced to 15 months?
Mr. King: I shall deal with that later. First, I wish to put this debate in context.
My right hon. Friend focused on the task facing the Army, which it is fulfilling with great courage, in Northern Ireland and Bosnia. The hon. Member for Motherwell, North dwelt on one particular but important part of the options programme, a part which also attracted the attention of the Select Committee. But I want to draw attention to everything the Army is facing and to the impact on its procurement programme.
In its earlier report the Select Committee was kind enough to say that whatever one thought about manpower numbers, the plans that we had made on the procurement side would ensure that we had an outstandingly well-equipped Army. I hope that those plans will be maintained, covering as they do the Challenger tank, the Warrior armoured personnel carrier, the AS90, the multiple-launch rocket system and the light attack support helicopter. All those components will be needed for the Army of the future.
What we put in place was a fully costed programme for fully manned units. That is the end towards which the "Options for Change" programme has been working. It is a clear programme and it allows for adaptation, change and integration, running through to 1995–97. In that respect, I strongly supported my right hon. Friends, and when I have spoken on this subject, I have always said that we would keep it under review. Despite that, the only significant change in a programme involving a decline in numbers from 320,000 to 250,000 ended up as a matter of some 3,000 men at the margins of the infantry—a sensible move.
What has changed since the original programme was announced? There have of course been more deployments, with considerable consequences for the units that have to undergo training, recuperation thereafter and reasonable tour intervals between visits to Northern Ireland. There are to be two extra battalions for Northern Ireland besides the major unit for Bosnia. Under the latest public expenditure survey round, defence will receive £1 billion less over three years than we had thought would be available when we announced the programme. We need to examine what impact that will have.
I have already said that I support the idea of the additional infantry regiments. My right hon. Friend spoke

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of £80 million a year as the cost of those two regiments —money that will have to come from the existing budget. Receiving £1 billion less will have implications not only for the Army but for the Navy and the RAF, too. I am glad to learn from its Chairman that the Select Committee is to look into "Options for Change" for the Navy and Air Force.
Despite the difficulties of Bosnia, I wish to talk about Northern Ireland today. It is the cause of "stretch" for our forces. We have 12 battalions in Northern Ireland, six permanent and accompanied and six unaccompanied. It is the unaccompanied tours that cause the "stretch" for the Army as it carries out its tasks also in Bosnia, Belize and the Falklands. The unaccompanied tours interval represents the real challenge.
As part of the United Kingdom, Northern Ireland must have its security needs met—the people of Northern Ireland are entitled to no less—but at this stage we need to examine carefully how that security can be achieved. Infantry are not the only means of achieving it. The hills of South Armagh are not friendly territory for members of the RUC, with their tradition of policing, but alternatives might be possible in other areas, where highly skilled infantry should not necessarily be deployed and where it may be possible to make better use of manpower.
All this will involve arguments between Departments and about PES allocations. For the RUC and the Royal Irish Regiment, it will raise issues that could affect both the home battalions and the regular and the reserve members of the RUC. Unless we deal with these issues sensibly, the pressures will grow. Members of the Select Committee will know what I mean when I say that the pressures will grown because of the "stretch" involved in our Northern Ireland commitment. Flexibility in these matters is what needs to be studied by the Departments concerned.
There is common agreement that the world has changed. The threat has fractured, but not disappeared. We need a clear plan to work to; we need to ensure that it keeps pace with our new requirements in changing circumstances, including financial circumstances. We should not try to patch and mend as we go along. We must ensure that fully manned, fully costed and properly structured units are established. I hope that I have the support of the whole House when I say that I take the same stand as I took in the foreword that I wrote to "Britain's Army for the 90s":
"Our commitment remains clear; an Army for the 90s and beyond, smaller and better-equipped and supported, fuly manned and well able both to meet its commitments at home and abroad, and to provide for our security in the future as it has done so well in the past."
5.29 pm
Mr. Menzies Campbell: As the debate has demonstrated, no one in the House can escape the irony of the date on which it takes place. As we have heard, notification of redundancies will go out tomorrow, and to some of the men whom members of the Defence Select Committee, including myself, met last week in Split and Zagreb.
It is fair to say that Ministers' approach to the issue may well have reason on its side, but there are occasions when decency, humanity and other considerations ought to overrule reason. I do not find it particularly compelling
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to suggest that there could not be some scheme which allowed those who were volunteering for redundancy to take it, while preventing, as far as possible, those forces serving in Northern Ireland or in the former Yugoslavia from receiving redundancy notices at times when their lives are undoubtedly in danger.
In the light of recent events, it is inevitable that the debate so far has concentrated on the role of the infantry. Government insouciance over recent decisions can hardly be properly justified, because for many months Ministers claimed, both in the House and elsewhere, that there was no need to alter the proposals for our infantry batallions contained in "Options for Change". Now they would have us believe that a reconsideration was taking place all the time.
Contemporary evidence is often more revealing and compelling than that which is by way of ex-post facto justification. I direct the attention of hon. Members to the evidence given to the Select Committee on Defence, which they will find repays careful re-examination. I can say without equivocation that no one told us an untruth, but I am left with the unshakeable conviction that we were subject to deception by omission and concealment. The next time that some of the people who gave evidence appear before us, we shall certainly make a point of counting the spoons after they leave the Committee Room.
The Secretary of State's reversal had an air of inevitability about it. In spite of the campaigns fought on behalf of certain regiments, it was not an emotional argument about tradition and history, but an argument in which the cold logic of numbers was ultimately bound to prevail. In my judgment, that logic is unaffected by the Secretary of State's decision. The conclusions of the Select Committee report were not in any sense affected either.
I do not intend to dwell on the terms of the report because I observe that the distinguished Chairman of the Committee, the hon. Member for Upminster (Sir N. Bonsor) is seeking to catch your eye, Mr. Deputy Speaker. In the order of things, I fancy that he has a reasonable chance to do so and will no doubt take the opportunity to detail on behalf of the Committee those issues that seem to him to be appropriate.
The theme so far has been the obligation to match tasks with resources. After the end of the cold war there was a public perception that defence expenditure could safely be reduced. However, one can rationally reduce expenditure only by reducing commitments, and one can sensibly reduce those only when one has determined what are essential and what may be discarded. There is no particular intellectual challenge involved in any of that —it constitutes a defence review—nor is there any shame or admission of weakness on the part of a Government who set themselves that task.
The right hon. Member for Bridgewater (Mr. King) argued that precisely such an analysis had taken place, citing the authority of the Chief of the Defence Staff and others. If such an analysis has taken place, neither he nor his distinguished successor have been able to persuade successive Defence Select Committees that a proper rational basis existed for their decisions and proposals.
Mr. Gyles Brandreth: Does the hon. and learned Gentleman confirm that it was his party's view that a 50 per cent. reduction in defence expenditure was called for before the end of the century? That would have meant about 73,000 service men in the Army, as opposed

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to 119,000. So he is being a bit holier-than-thou—or perhaps he will explain that the 50 per cent. reduction was not his policy.
Mr. Campbell: When it comes to being holier-than-thou in the House I think that I could learn a few lessons from the hon. Gentleman. I had a small bet on which Conservative Member would be the first to mention that, and although the hon. Gentleman's name was not in the top three, it was certainly in the top 10.
Mr. Julian Brazier: Answer the question.
Mr. Campbell: If the hon. Member for City of Chester (Mr. Brandreth) had been in the House as long as some other hon. Members, including the hon. Member for Canterbury (Mr. Brazier), who is making a somewhat noisy intervention from a sedentary position, he would know that I have never argued in the House in favour of a mandatory reduction in defence expenditure and nor has my party.
In the aftermath of the cold war, my party suggested that it might be possible to achieve a reduction of as much as 50 per cent. in defence expenditure by the end of the century, subject to two important considerations: first, that there should be a full-scale defence review; secondly, that there should be far greater integration between the defence policies of European Community countries. I hope to return to that topic and to advance the cause for a degree of specialisation, which has not so far been obvious in the nature of the defence provision made by those countries.
Several Hon. Members rose—
Mr. Campbell: I must give way to the hon. Member for Canterbury, lest I should cause him to suffer some apoplectic convulsion by not doing so.
Mr. Brazier: I am only trying to shout through my cold. The hon. and learned Gentleman and the Opposition spokesman set out the case for overstretch. Surely he must realise that he cannot argue consistently that there is overstretch and that his party would like something to be done about it, unless he is willing to turn his back on his party's commitment to cut defence spending, or to say which commitments he would be in favour of removing.
Mr. Campbell: If the hon. Gentleman had been in the House a fortnight ago he would have heard the Chief Secretary to the Treasury upbraid Opposition Members who were unwilling to think the unthinkable. If we were supposed to think the unthinkable of the great Departments of State, such as the Home and Foreign Offices, why should the Ministry of Defence be exempt from such critical analysis?
We should re-examine several of our overseas commitments. I do not shrink from saying that our continuing commitment in the Falklands should be re-examined, and that we should ask ourselves whether it is in our interests to have forces in Belize. Is it still in our interests to continue to contribute towards the United Nations efforts in Cyprus? We still meet a range of obligations which deserve intellectually rigorous analysis so that we can decide whether they are in the interests of the United Kingdom and I am prepared to embark on that.
What I find so surprising is that the hon. Member for Canterbury is not prepared to allow that that might be a
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way to bridge the difficult gap between the public perception that less needs to be spent on defence and the public perception which urges us to try to meet what is possibly an increasing number of commitments, under the aegis of the United Nations.
Mr. McWilliam: Does the hon. and learned Gentleman recall that, only a couple of weeks ago, we were given evidence that there are British forces in 50 locations around the world at present?
Mr. Campbell: I certainly do recall that evidence. Those who have studied the report of the Select Committee on Defence will doubtless have formed their own conclusions about it.
The intervention of the hon. Member for Canterbury allows me to pick up the point made by the hon. Member for Motherwell, North (Dr. Reid). The Government still argue the case for a replacement for the WE177 free-fall bomb. Despite the guarded responses given at Defence Question Time about a week ago, that replacement still includes the possibility of tactical air-to-surface missiles.
The notion of TASM, and its requirement, comes from those days when flexible response was the central thesis of the nuclear doctrine of the North Atlantic Treaty Organisation. Since then, flexible response has been replaced by minimum deterrence and, now, by a doctrine of use in the last resort. The purpose of a tactical air-to-surface missile was to break up the massed tank formations of the Warsaw pact countries as they streamed across the central German border. That threat is no longer before us.
Therefore, what is the rationale for the tactical air-to-surface missile, especially when, if we wanted to have a sub-strategic capability, we could put a single warhead on a single missile on Trident? There is absolutely no justification for spending up to £3 billion on a weapon conceived in circumstances that have long since been overtaken by events, in respect of which we can have a capability as part of existing expenditure.
Mr. Brazier: At present, we have a variety of independent sources, not least Jane's Defence Weekly, that suggest that nuclear technology—and possibly even nuclear weaponry—are proliferating around the middle east and a number of other countries. Without such a visible sub-strategic capability that can sit on the edge of a radar screen, we could, before the turn of the century, face a threat to our homeland with which we could not cope.
Mr. Campbell: The hon. Gentleman seems to be operating in a vacuum in which Great Britain has to provide for its own defence at every level and in respect of every capability. Hon. Members have been debating NATO, and hardly anyone has not subscribed to NATO's objectives.
Mr. Richards: Will the hon. and learned Gentleman give way?
Mr. Campbell: No, I shall not give way.
Everyone accepts that there is a need for NATO to change its role and that the concept of crisis management should be part of the raison d'etre of NATO in the period after the cold war. Why does the United Kingdom have to possess a specific nuclear capability at every level? Is it being suggested that all NATO's nuclear capability—both

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strategic and sub-strategic—will be inadequate and insufficient to protect us against the threat of nuclear proliferation in the middle east? One has only to put the proposition in those terms to see how absurd it is.
Dr. Reid: Otherwise we would need 8,000 horses to face the Cossacks.
Mr. Campbell: The Cossacks were a little before my time. The hon. Gentleman may know more about them than I do.
It is self-evident that if one maintains the widest range of capabilities against a decreasing budget, everything will eventually be performed inadequately. Flexibility may be achieved only at the expense of expertise. If we have to send gunners to Northern Ireland to perform infantry duties, their value in their primary role will inevitably be degraded.
The Maastricht treaty—with which I believe you have more than a passing acquaintance, Mr. Deputy Speaker —envisages a much more integrated defence policy among European Community members. Why are the Government giving no thought to specialisation in specific sectors? Surely, in that way, NATO or the European Community could maintain a range of capabilities within the financial constraints created by the public's post-cold war perceptions.
Yesterday's debate about United Nations peacekeeping inevitably provides a context for today's debate. The Official Report shows that no one argued that we should avoid or abandon United Nations peacekeeping obligations. The Foreign Secretary said that we should try to adopt a position somewhere between the saloon bar and Mr. Gladstone. If reports of Mr. Gladstone's nocturnal activities were correct, the position between the saloon bar and Mr. Gladstone might not be too salubrious.
During the debate there was an implicit acceptance of the fact that, as a permanent member of the Security Council, we shall continue to have obligations to provide troops to meet United Nations commitments. There is an additional reason beyond our permanent membership of the Security Council: our forces are good at such tasks. They are professional, well trained and well led and, compared to some of those from other countries—of which we heard when we visited Croatia last week—they are extremely well equipped. The Secretary of State's announcement, welcome though it is, would effectively be nullified if we received a request from the United Nations to expand our existing force in Bosnia to brigade size, as that would necessarily involve the commitment of two more battalions.
The effectiveness of our contribution to United Nations peacekeeping will depend on the quality not only of the forces that we deploy, but of the equipment with which we send them to do the task. Some of the contingents in Croatia—for example, the contingent from Nigeria, which has to rely on the United Nations to provide all its vehicles —have been less effective than other contingents such as ours and that from Canada. The Canadian contingent brought vehicles in excess of the number requested by the United Nations.
We have a moral obligation not to place our forces, on behalf of the United Nations, in circumstances where they are liable to be outgunned or their equipment
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outperformed. One of the benefits of specialisation may be to reduce the range of equipment that we have to procure. It may not always be necessary to provide state of the art equipment, but it must surely be right that those whom we ask to perform difficult and dangerous tasks should be well equipped to do the task for which they are deployed.
We should also recognise that, while peacekeeping may well require different skills from those asked of the average infantry man, it may also require different equipment. Therefore, embarking on a commitment towards peacekeeping has a series of implications and possible consequences to which serious regard must be given.
The right hon. Member for Bridgwater mentioned Northern Ireland, and I associate myself with some of the sentiments he expressed. I hope that the recent formation of the Royal Irish Regiment is proceeding successfully, and that the hopes and aspirations that accompanied our debates in the House are being realised. Many hon. Members clearly found the notion of a regiment drawing from both traditions in the community of Northern Ireland an attractive one.
However, we must never forget that the battalions are there to support the civil power. As soon as it is feasible to transfer responsibility away from the military power to the civil power, surely it will be right to do that. Therefore, I hope that the Government will take careful heed of what the right hon. Member for Bridgwater said and will keep under proper and consistent review the extent to which the transfer of function back from the military to the civilian power can be achieved.
Croatia was one of the places that the Select Committee on Defence visited last week. As some hon. Members may be aware, British forces operating in Croatia do so under the command and control system of the United Nations, whereas those in Bosnia operate differently. As the hon. Member for Stockton, North (Mr. Cook) said yesterday, some of us were astonished to be told by a senior commander in the British force that his interpretation of the rules of engagement was that if, in order to avoid bloodshed, it was necessary for someone to hand over his own equipment or personal weapon, such action was required.
That came as something of a surprise, and I suspect that it has not been generally discussed or understood in the House. I refer to that so that hon. Members can appreciate that when, not lightly but perhaps without necessarily thinking of all the consequences, we assign British forces to the United Nations, we may be putting them in a situation in which, for example, the rules of engagement are rather less robust than those that we would regard as essential in other circumstances.
Nuclear testing has featured briefly in the debate. I cannot understand why the Government do not take the political opportunity offered by the moratorium, because the practicality is that we cannot test at Nevada, as the Americans are engaged in a moratorium. The United States, France and Russia all believe that their nuclear capabilities are not being eroded by a moratorium. Why do the British Government not accept that they have a practical moratorium and seek to gain for themselves the political advantage that arises from being associated with a gesture? I freely accept that it is a gesture, but it is an important one in our efforts to try to persuade other countries, especially in the middle east, that they should not seek to acquire and deploy nuclear weapons.
Mr. Dalyell: Does the hon. and learned Gentleman accept that, at least according to Lord Zuckerman's article in "Nature", the Americans now think that on technical grounds there is no need for testing? Even if the hon. and learned Gentleman gives me or other hon. Members who have intervened a frivolous answer, can he explain how Sir Hugh Beach, a distinguished general, could sign a letter to The Times suggesting that? We need an answer from the Ministry of Defence.
Mr. Campbell: I know better than to give the lion. Gentleman a frivolous answer to any intervention, and especially the one that he has just made. Not only the distinguished scientist to whom the hon. Gentleman referred but the former head of the Los Altos laboratory is on record as saying that it is not necessary to engage in a regular programme of testing to be satisfied that nuclear weapons are functioning.
It is customary on these occasions to pay tribute to the courage and professionalism of our armed forces and, in this debate, to the courage and professionalism of the Army. I do so with conviction borne of recent experience. During the visit by the Select Committee on Defence to Split and Zagreb it became abundantly clear that everyone in the House and in the country could be proud of the remarkable contribution in extremely difficult circumstances of our armed forces in the two United Nations efforts.
I found some resentment because there was a sense that the public perception in Britain was that the British effort as part of the UN effort rested only on the activities of the Cheshires. There is a great deal of pride in the activities of the Cheshires, but some people were anxious to point out that the logistical, engineering, transport and medical support was extremely high. The conditions in which that support was being given were frequently difficult and made substantial demands on those who provided it.
To those of us who visited Zagreb it seemed that the calm, almost matter of fact way in which substantial responsibility was being accepted and discharged could only be regarded as being in the finest traditions of British forces. It is conventional on these occasions to say how much we value them, but 24 hours a day, in Northern Ireland and especially in the former Yugoslavia, the qualities that we admire are being put to the test. It is right and proper for the House to acknowledge that.
5.54 pm
Mr. William Hague: I am pleased to take part in the debate, and I am rather surprised at being called at this time. My interest is primarily a constituency one and my comments may be a little more parochial than those of some of my hon. Friends, because the heart of my constituency contains Catterick garrison, one of the largest Army bases in the country. It also has other military installations. It is a great tribute to those who serve or who have served in Catterick that their presence is viewed positively by the population of Richmond and the surrounding areas. We have a particularly strong and proud association with the Green Howards.
A succession of garrison commanders has built up an impressive track record of good community relations. Even more important is the obvious professionalism and dedication of locally stationed units to their training and other tasks. Two weeks ago, I visited 521 company of the Explosive Ordnance Division, effectively the bomb
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disposal team for the north of England. It is stationed at Catterick and I cannot speak too highly of the commitment and excellence of its men.
"Options for Change" means an upheaval for Catterick garrison as much as for the rest of the Army. The long-established presence for the training regiment and other units of the Royal Corps of Signals is to end and that is viewed locally with some sadness. I was pleased to hear from the Minister that infantry recruit training is to be concentrated at Catterick and that the 19th mechanised brigade and other units yet to be determined are to move in. I think that that will mean an increase of about 2,000 in the number of military personnel and their dependants associated with the garrison.
The Army has gone to some lengths to keep local civic leaders and planners fully informed of the changes, and the continued use and further expansion of the garrison has been strongly welcomed. I add to that welcome, having long believed that more of the Army should be stationed in the north of England in any case. Much of the Army is recruited there and it makes sense to concentrate infantry recruit training at Catterick.
I should like to make two points about the huge movements of people and material in and out of Catterick. First, a decision has yet to be announced about the use that the Army will make of the facilities currently occupied by the Royal Air Force Regiment a short distance from the garrison. The future of that base has major implications for local education provision and possibly for the design of roads giving access to the A1. The sooner a decision can be announced on this matter, the better.
Secondly, the reorganisation of Catterick camp will involve the departure of thousands of people and the arrival of thousands more with accompanying vehicles, tanks and so on. Much of it will require the redevelopment of areas of the camp, and it adds to an investment of over £100 million. It is a vast management undertaking. The commander of the garrison and his chief of staff and their assistants are able people who have provided an intricate master plan for how the whole exercise will be managed.
My concern is that the personnel in these positions seem to change so frequently that continuity of management and decision taking become extremely difficult to maintain. We are considering a four or five-year project, operating on a huge scale with rigorous management of infrastructure development, housing stock and all the movement itself required. A bit of stability is called for in the team of people given the task of carrying it all out.
Catterick garrison will continue to be a welcome feature of north Yorkshire, and the local civilian population look forward to continuing to have the Army as neighbours. We shall all work together to ensure that the garrison is an attractive, well ordered and peaceful place for a large, and now a larger, part of our Army to live. I make no apology for speaking at length about Catterick, which is the largest centre of population in my constituency. I shall now deal with the crucial role of many of the Army's support services which are also stationed at Catterick garrison.
About 1,200 civilian jobs at the garrison are to be market tested. I strongly support the principle of market testing across as wide a range as possible of the Government's activities. It is a valuable spur to greater efficiency and can give well deserved opportunities to the private sector.
I notice from the Secretary of State's statement earlier this month that it is believed that the savings flowing from

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the market-testing process in the Ministry of Defence will fund up to 2,000 additional places in front-line units of the field Army. That alone is sufficient justification for the process. However, my constituents who work at the garrison would welcome assurances that the market testing process will be open and fair and will give the opportunity for efficient in-house bids to succeed.
A few weeks ago, I visited the REME workshops at Catterick. The excellence of the work carried out there to keep Army units functioning and on the road is beyond dispute. Many of the 180 people who work there have been there all their working lives and started there as apprentices. They know every piece of Army equipment inside out, and they have often been called upon to work round the clock to prepare units to move—most notably in recent weeks with the preparation of vehicles to go to Bosnia. In my view, an in-house bid put together by these people would take some beating, but a categoric assurance from the Minister that they will have every chance to make such a bid successful would do much to dispel what I believe are unjustified fears in the vicinity of the garrison.
The House will have gathered from what I have said that my constituents show a keen interest in the future of the Army and that many have a direct stake in it. Like me, most of them believe that the overall reduction in the size of the Army is a painful necessity rather than something to be welcomed. The end of the cold war justifies a reduction in our military effort and expenditure. On the other hand, it makes it more difficult to know just what sort of Army we should have.
The speed and complexity of modern warfare suggests that our forces should, in the main, be highly mobile and heavily equipped, yet the most frequent demands on them are to serve in Northern Ireland or in roles such as we see in Bosnia, where they are required to perform a more conventional infantry function. Such contrasting duties make flexibility very important, and mean that a decent interval between emergency tours, as identified in the Select Committee report, is essential for training and retraining. The decision a few weeks ago to retain an additional two regiments will undoubtedly help.
With that modification, I believe that Ministers have made the right judgment about the overall size of the Army that Britain should sustain. If the Army, at its new size and in its new configuration, becomes overstretched, we must be more careful about taking on commitments rather than think that we must have a larger Army or go back to one of the size that we had during the cold war. I would not like to see further adjustments to "Options for Change" which would be at the expense of the Navy and Air Force, which it is all too easy to forget when unexpected demands are made on our armed forces in Northern Ireland and Bosnia, are in the absolute front line of our national defence.
Here I must refer to some of the remarks of the hon. Member for Motherwell, North (Dr. Reid), who spoke for the Opposition. He seemed to hold various contradictory positions about total defence expenditure and about the resources given to the Army. He attacked the possible overstretch of the Army and we listened with care to what he said about that, but he also said that a Labour Government would not have any greater defence expenditure than we have at the moment. The question
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whether expenditure would be lower or different in some way was left open, but if there is no commitment to greater expenditure and if the Army is overstretched, I think that what he wanted to say was that he would like to have a larger Army at the expense of some other parts of the armed forces, and that may be a perfectly coherent and respectable argument.
Mr. McWilliam: Perhaps it would have been easier if we had had a statement on defence estimates debate last year, but we did not have one. This is an Army debate, and that is what we are dealing with. I caution the hon. Gentleman to read the Select Committee report very carefully. The Green Howards, who are doing their stint in Northern Ireland, and are doing it extremely well, are one of the units that we were referring to which spent excessive nights out of bed and suffered from serious overstretch.
Mr. Hague: I entirely accept the point made by the hon. Gentleman. I have read the Select Committee report. I am talking at the moment about the remarks of the hon. Member for Motherwell, North. The announcement that the 29 per cent. reduction in defence expenditure voted for by the Labour party conference was partly retrospective and was to be backdated to 1984–85 was a startling revelation. I hope that the hon. Member will be going to the Labour party conference this year to explain that the huge reduction that it voted for has mainly taken place already and that it need not vote for such proposals in the future.
The hon. Member attacked the Government for an "unwillingness to face hard decisions", but I thought that he rather ran away from some hard decisions too, particularly on the question of the redundancies to be announced tomorrow. It is easy to whip up an emotional argument about redundancy notices being sent to officers who are serving and who may be under fire in Bosnia or Northern Ireland now, but would it be any fairer to say that a redundancy notice can be served on someone who is about to go to Bosnia or who has just come back from Bosnia? It would be a ludicrous way to decide who should be made redundant from the Army. So before the Opposition accuse the Government of being unwilling to make hard decisions, they need to reconsider how they have run away from hard decisions themselves today.
I support the stance and the policies of the Government, but I ask them to bear in mind the points that I have made about the future of Catterick garrison.
6.6 pm
Mr. Andrew F. Bennett: I want to deal with five areas, and I will try to be as brief as possible, but I should like to press the Minister a little on nuclear tests. I realise that it is almost impossible for the Government to make a statement in the House today if the Prime Minister is negotiating in Washington at this very moment on this matter, but I hope that we can at least have an assurance that, when the Prime Minister returns, we will have a clear statement of the position.
As I understand it, the Americans have now made it clear that they do not consider that a regular testing programme is essential to maintain the credibility of their deterrent. It is very unlikely that they will be willing for Britain to go on testing in Nevada without paying very much larger sums of money to do the testing and, if they decide to give up, they will probably be totally unwilling to

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allow us to carry out tests. So I hope that, when the Prime Minister comes back, he will make a statement to the House making clear what new arrangements we have made with the Americans about testing.
I would argue that, if we want to press for non-proliferation in the world, we must give up testing when it is quite clear that many experts are now satisfied that even if we wish to maintain a nuclear deterrent we do not need to test anyway. I would also argue that we must try to reduce our nuclear capacity again if we want to have any credibility in pressing for non-proliferation. It is absolutely outrageous to me, therefore, that we should consider the expenditure on tactical air-to-surface missiles when it would be an escalation of our nuclear capability. It would be difficult to persuade others that it was perfectly all right for Britain to expand its nuclear capacity but that they should not do so.
I therefore hope that we shall have a speedy review of the whole of this area and will build up a credible case from this country for non-proliferation.
Turning to the Cheshires, I was pressed very hard by many of my constituents when the decision to merge was announced, and I made it clear to them that it would have been totally illogical for me to plead with Ministers for a change in Government policy when I have always argued in favour of defence cuts; so I did not do that and some of my constituents were not too pleased. On their behalf, however, I must say that they are very pleased that the Government have announced the reprieve of the Cheshires. I also pay tribute to the service which they are performing in the former Yugoslavia.
Some of their relatives have told me that they find it difficult to understand that their sons are out there trying to prevent people from dying of starvation but are not trying to prevent those same people from dying from bullets. They find that difficult to cope with when, throughout history, warfare has always involved attempts to starve populations, sieges and so on. I make a strong plea that it is not enough to have troops there providing humanitarian aid. We should use all possible power to establish peace and persuade people to live peacefully together. It is difficult to go on providing humanitarian aid in the current circumstances.
Conservative Members do not seem to understand the sensitivity surrounding redundancy notices. Recently, in an engineering firm in my constituency, the personnel officer made people redundant. He called them into the office, told them about the redundancies and sent them home immediately. I suggested that that was insensitive because they might want the opportunity to discuss with other workers what action they might take. He justified sending them home on two grounds: first, when a person's world was almost coming to an end because of redundancy, that person wanted the opportunity immediately to discuss it with his family; secondly, when people had that shock, their efficiency was not as good, and it was easy for accidents to occur.
Although it may be important in the management of the whole Army to inform people at the same time about redundancy, it does not ensure the most efficient action of individual soldiers for them to be told when they are on active service. When it involves the safety not simply of the individual soldier but of other soldiers serving with him, it is insensitive to serve the redundancy notice on him at that time. It will be difficult for the soldier to discuss the redundancy with his family; therefore, it will increase his
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anxiety. In addition, when a person who believed that his future within the Army was secure receives the shock of redundancy, it may affect his military capability, however well trained he is.
On a totally different issue, the Army pay office is to be moved. The Minister will be aware that part of the pay office is in Ashton. Although it is in the constituency of my right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon), many of the people who work there live in my constituency, and it is a substantial employer in Tameside. There is much concern at the decision to move the pay office from Ashton, probably to Glasgow, although the Minister said that a final decision had not been made. There is great disappointment in Tameside that the Government did not think of it as a site. I still hope that they will reconsider it.
At Ashton there is the pay office and the audit section which has been civilianised over the last three years, with the recruitment of new staff. Many were attracted to work for the Army in the audit office in the belief that they would have long-term job security. Now they will not have that security because, if the pay office moves to Glasgow, policy has been agreed that the last in will be the first out. Therefore, there is a danger that many of the people who were recruited to work in the audit section in Ashton will be made redundant and people working in the pay office will move to the audit section.
That is not efficient. In addition, it is grossly unfair to people who in some cases gave up reasonably secure jobs, perhaps not as well paid. I hope that the Minister will examine the position and will consider the unfairness of making redundant people who were recruited to the audit section within the past three years.
I am disappointed that, in their development of "Options for Change", the Government have not taken account of the whole picture in regard to defence lands. If they wanted to improve the efficiency of the Army and the other services, they should have examined more carefully the use of defence lands. The position on defence lands has been a mess almost since the first world war. Most were acquired during the first and second world wars. There was very little logic about acquisition. It was done in the emergency of war, and lands were taken over on the basis of the quickest and easiest solution at the time.
The Ministry of Defence has been reluctant to give up defence lands. Great pressure built up in the House and outside in the 1960s for the release of substantial areas because they were no longer required. Eventually, the Government were persuaded to set up the Nugent committee, in 1969, I think. The committee was packed with people sympathetic to the Ministry of Defence. Even so, four years later—the establishment of the committee having been a delaying tactic in itself—the committee recommended that the Ministry should release substantial amounts of land because they were not being used for manoeuvres to the extent that the Ministry had claimed.
Sadly, very few of the recommendations of the Nugent committee were implemented. Some access was gained at Lulworth cove and other places. Around barracks in urban areas, some land was sold for housing, but on the whole the Ministry of Defence held on to most of the land. Throughout the 1970s and the early 1980s the message from the Ministry was that eventually land would be released. For some reason, in the mid-1980s the Ministry started to change its tune and argued that it needed extra land.
Mr. Robathan: There is certain illogicality in what the hon. Gentleman is saying. The hon. Member for Motherwell, North (Dr. Reid) talked about keeping more troops, which I applaud. As we know, we must bring troops back from Germany. I can assure the hon. Gentleman that defence lands are under severe pressure for training. Indeed, territorial and regular units cannot get on training areas because they are so busy.
Mr. Bennett: I understand that argument. I am aware that certain defence lands are used almost to the optimum, but other areas are not used to anything like the same extent. All I am arguing for is a thorough review. In "Options for Change" the Government did not examine the implications of the use of defence lands. They have not been prepared to answer questions in the House about a review. There are areas which the Government should consider.
The Nugent report made it clear that there were unexploded bombs and other ammunition in substantial areas, particularly in northern Northumberland, which had been used for military exercises during the Second World War. There was a programme to try to clear those areas to bring them back into recreational use or other military use. Because of the Falklands war, the bomb disposal activities were suspended. Although activities resumed after the Falklands war, with the conflict in the middle east the bomb disposal experts were again taken away. I would certainly argue that much more of that land could be made safe and used for essential military exercises or released for use by the general public.
We need a proper review. The Minster says that there is a review, but in its report just over a year ago the Audit Commission was extremely critical about the fact that there seemed to be no proper strategy for the use of Ministry of Defence land. There seemed to be considerable pressure for exercises to take place on some sites, but other sites seem hardly to be used at all. If we develop an increased peacekeeping role in the world, the exercises and training manouvres are likely to change and it may be possible to carry out those exercises where people are involved in other activities rather than in totally secluded areas. We need a proper review before there is another haphazard Government attempt to acquire fresh land.
The Minister will be aware that there was a public inquiry into claims by the Ministry of Defence that it needed more land in Kent. There was then the question whether the Ministry should take over more land at Holcombe moor. There was a great deal of upset around Bury about the prospect of part of the moor being taken over for military exercises. The Government told the public inquiry that the land was absolutely essential for military exercises and the inquiry found in favour of the Government. Then, perhaps for political reasons, the Government suddently changed their mind and announced that they had decided not to continue with their proposals.
Last autumn, the Government proposed to take over the Cnewr estate in south Wales. Again the proposal was not based on any rational plan. The Government really need to carry out a proper review. There needs to be a proper debate in the House about how much land the military needs for its exclusive use, how much land it needs for exercises but which also could be used by the general
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public at other times and how much it all costs. So far, there has been no effective response from the Government to the criticisms of the Audit Commission.
My final point concerns arms sales. I do not consider that it is very graceful for Britain to be selling arms around the world, but I understand the argument that, if we do not do it, other people will and that, allegedly, we are extremely choosy about those to whom we sell arms and that we try to choose people who are not likely to use those arms against us or our soldiers. However, some of the messages that I have been getting from the former Yugoslavia suggest that some of the arms used by various factions there have come from some very odd places.
If we are to sell arms, we must work hard to ensure that, when we supply people with new arms, we do not set in motion a chain of second-hand arms sales which ultimately lead to some of those weapons ending up in the most obnoxious places in the world.
Mr. Frank Cook: Cascading.
Mr. Bennett: Cascading, as my hon. Friend says.
The Government should consider the possibility that, when arms are sold, attempts should be made to persuade those who are modernising their weapon systems that, as part of the deal, we should buy back the old weapons so that they can be destroyed and taken out of the arms circuit. It is appalling to see the consequences of the cascade of arms throughout the world, particularly in some parts of Africa and in the former Yugoslavia. It seems stupid for us to encourage the arms trade and then to be asked to provide peacekeeping forces to separate people who are using weapons that we have not supplied directly but have allowed to cascade down to the combatants in those areas.
Mr. Robathan: Which particular peacekeeping operations does the hon. Gentleman have in mind that involve British troops who are likely to be under attack from British arms?
Mr. Bennett: I very much hope that our troops do not become targets in the former Yugoslavia, but we are on a knife-edge in that country, and the situation could escalate.
I am told that some of the weapons finding their way into the former Yugoslavia were manufactured in Britain. I have not been there, so I speak not from experience but from the messages that I receive from my constituents who have members of their families serving there. The Gulf war is another example.
Mr. McWilliam: I got back from Bosnia last week. The only weapon we saw that was not of indigenous Yugoslav or former Warsaw pact manufacture was an old American tank in Croatia.
Mr. Bennett: It is clear that arms are percolating through the world and increasing tension. If we continue selling arms, we must look at the ways in which we can reduce the use of second-hand weapons to create areas of tension in which we are then asked to perform a peacekeeping role. It will be far better for people not to have the weapons for the conflict than for our soldiers to attempt to maintain peace between warring factions.
6.25 pm
Sir Nicholas Bonsor: Before I reach the main purpose of my speech about the two reports before the House, I should say a word or two about the Defence Committee's visit to Bosnia. It was covered quite extensively yesterday in speeches by my colleagues on that Committee, my hon. Friend the Member for Gosport (Mr. Viggers), and the hon. Members for Stockton, North (Mr. Cook), for Walsall, South (Mr. George) and for East Lothian (Mr. Home Robertson). I strongly recommend that hon. Members read those speeches, all of which I whole-heartedly endorse.
However, I should like briefly to make one or two new points. First, I extend the thanks of all members of the Select Committee to those members of the armed forces and in the Ministry who organised and hosted the trip. In the extremely dangerous circumstances in which our soldiers operate, it is not always easy, necessary or welcome to receive a delegation of parliamentarians. However, we were given a very warm welcome and I understood from those who greeted us that they appreciated the fact that we went to see what was happening. I certainly have a very much better understanding of the appalling tragedy being enacted in that country.
I make three brief points arising from the visit itself. First, as the hon. and learned Member for Fife, North-East (Mr. Campbell) said, there is some resentment that there seems to be a perception in Britain that only the Cheshires are serving. The Cheshires are doing a magnificent job, and it is wonderful news that my right hon. Friends on the Treasury Bench have decided to reprieve them. However, there are also other units there doing a great job. I single out in particular the Royal Engineers, who have carved roads through virgin territory to enable United Nations aid to get through. Those roads can accommodate heavy-track vehicles two abreast through mountain passes and forests. The quality and calibre of their work is breathtakingly good.
I join the hon. and learned Member for Fife, North-East in paying tribute to them and to all our soldiers serving in the former Yugoslavia who are facing much greater danger than one might perceive from the limited casualties that we have suffered so far. The death of Lance Corporal Edwards was tragic and extremely unfortunate. He was most unlucky in that he was struck although he was in an armoured vehicle and quite heavily protected. A young officer was also wounded. We have suffered no other casualties as yet, and I pray that whatever casualties we may face will be limited.
However, our troops face increasing danger and I do not believe that the Bosnian situation can be sustained for very long at its present level. It seems to me that the danger is increasing daily, given the increase in the number of direct attacks on our troops. The officers to whom we spoke were gravely concerned about that, although the men faced it with their usual courage and equanimity: their morale was extremely high.
There is a limit to our ability to continue to provide the service that we currently provide and to sustain the limitations on our involvement. I do not believe that, if we try to continue for many more months, we shall escape more direct attacks, or escape being drawn into much more direct commitment to the conflict that we want. I must tell my right hon. and learned Friend the Secretary of
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State that, in my view, unless we move forward—which will mean the fastest possible promotion of the Owen-Vance peace plan, or something very like it—we shall have to decide either to send in more troops to sustain our support, or to withdraw our troops. The current level has only a limited life.
Let me now deal with the reports. Although publicity has been given principally to the concentration on numbers and tasks which is evident in our report, the equipment side should not be forgotten. I am glad to see that my hon. Friend the Minister of State for Defence Procurement is present. We await news on the Challenger I upgrade and on the degree to which we may order more Challenger II or upgrade more Challenger I; the Army needs to know the details as soon as possible, in order to plan for the future.
We also await news on the MLRS III—the updated multiple-launch rocket system—and its air-launched equivalent, the 1238. I hope that the Government will be able to make an announcement in the near future; I believe that the MOD has carried out an operational search to assess the possible need and has concluded that both systems are indeed required. I hope that both will be supplied and that we shall not be forced to choose between the two.
I pay tribute to my predecessor as Chairman of the Defence Select Committee, my hon. Friend the Member for East Hampshire (Mr. Mates), who is now Minister of State, Northern Ireland Office, with responsibility for security. He chaired the Committee for at least eight years and performed a splendid task. His report, produced a year ago, foretold the current problems of infantry overstretch long before my right hon. Friend the Member for Bridgwater (Mr. King) acknowledged the existence of any such problems. I am sorry that my right hon. Friend is not present to hear me say that.
The Select Committee report was greeted with some scorn by the MOD. In its reply—produced, I believe, in July—the Ministry stated that it saw no reason to review "Options for Change" at that time and hoped that the matter was now closed: I remember that phrase. My right hon. Friend the Member for Bridgwater is now present; I do not know whether he heard what I said, so I shall repeat it. The current Select Committee's predecessor criticised "Options for Change" and suggested that there were problems earlier than was suggested today by my right hon. Friend. I cannot accept that "Options for Change" was right and that only subsequent events have altered that.
Mr. King: I apologise to my hon. Friend for not being present earlier; when his name appeared on the annunciator, I was on the telephone.
We always made it clear that "Options for Change" must provide a plan to which people could work. We owe no less than that to the armed forces, whose personnel needed to know where they stood. We set out our plan clearly and, at the same time, made it clear that it might be necessary to review that plan. My right hon. Friend the Minister of State for the Armed Forces nods. If my hon. Friend studies the document from which I quoted, he will find the statement to which I refer. We said the same throughout the process and what we forecast is precisely what happened. My right hon. Friend the Minister has honoured the pledge that I gave then.
Sir Nicholas Bonsor: I did not come here to pick a squabble with my right hon. Friend the Member for Bridgwater, but I have said that there are points that I wish to pursue with him. I have also said that, in its reply to the Select Committee report in July—my right hon. Friend had given up his job by then and I do not attribute this to him—the MOD said that, at that time, there was no need to review "Options for Change" and that it hoped that the matter was closed. I was going on to say that the matter was not closed and that our report—which followed from the report produced by the predecessor Committee—made several recommendations, which I have no doubt that hon. Members have read.
The Committee reached four main conclusions. First, it concluded that additional emergency tours—particularly the two in Northern Ireland and the one in Bosnia—had led to additional unacceptable contraction in the emergency tour interval for infantry units and, prospectively, for the armoured artillery and engineer units, which also do emergency tour plots. The average was supposed to be 24 months; now it is down to 16 or 17. Unfortunately, the welcome additions to infantry strength will not alter the ETP interval, either in 1993–94 or in 1994–95or so we have been told by the Ministry. I regret that, because it means that we shall be left with a wholly unacceptable level of ETP commitment during that period, which is not covered.
Secondly, the report emphasised that, although the situation had been exacerbated by the non-availability of battalions undergoing amalgamation, the mismatch of commitments and resources looked set to continue after 1995 as new commitments arose. I heard what my right hon. Friend the Minister of State for the Armed Forces said; I must tell him that I have seen no evidence that we are likely to be able to achieve a minimum 24-month gap between ETPs after 1995. If such evidence exists, I should be grateful if my Committee could see it. It strikes us as far more likely—given that more peacekeeping commitments are likely to occur in the next few years—that we shall continue to be unable to meet the 24-month minimum. It is common ground between the MOD and the Select Committee that that should be the interval between ETPs.
It was for that reason, and others set out in the report, that the Committee concluded, first, that a review of armoured reconnaissance strength was needed: the initial peacekeeping role that we are being asked to play calls for additional reconnaissance strength. I agree with the report of the predecessor Committee that we have cut armoured reconnaisance too much.
The report's main conclusion was that the remaining United Kingdom infantry amalgamations and disbandments should be cancelled. My right hon. Friend the Minister of State for the Armed Forces made great play of the costs of implementing the report's recommendations: he has named a figure of some £200 million. That exactly matches the Committee's assessment; although we did not include it in our report, I shall not quibble with my right hon. Friend. I suspect that the gross cost of reprieving the units involved would be in that region.
However, I do not think that my right hon. Friend dealt fairly with the point made by my hon. Friend the Member for Davyhulme (Mr. Churchill). I do not accept that reprieving another seven battalions would mean that all the existing redundancies in those battalions stood and
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that the men concerned would be replaced entirely by new recruits. I am sure that, on reflection, my right hon. Friend will not persist in that view.
Mr. Archie Hamilton: My point was that the front-line battalions that might be reprieved were, by nature, made up of young men who need to be recruited. Those whom we are making redundant are, on the whole, people who have served some time: most have served for more than 12 years. Obviously, some redundancies would be saved, but not very many.
Sir Nicholas Bonsor: I take issue with that. I do not think that my right hon. Friend has thought the matter through. I do not believe that, if seven full battalions were reprieved, my right hon. Friend would replace 75 per cent. of the personnel involved: I use that figure for the sake of argument. Were he to save, say, 50 per cent. of those personnel, on his figures, some £175 million a year would be saved for the next two or three years from the redundancy costs. Futhermore, there are ancillary costs to the Treasury.
That brings me to one of my hobby horses, but I shall resist the temptation to ride it too far. The Treasury will have to meet the additional costs of housing allowance, social security and other welfare payments. They will not affect the budget of the Ministry of Defence, but they will have to be met by the country. I believe that keeping these battalions in being would not cost the country a penny over the next two or three years.
I accept that we are proposing what amounts to a long-term reprieve, not something that would end in 1995. In that regard, I should like to make two points. First, I hope that the present economic plight of this country will not be eternal. When the economy recovers, it should be easier to fund a proper Ministry of Defence budget. Secondly, in 1995 or 1996, if various other things change, we may properly be able to make cuts such as are being put forward as being correct now. If nothing else, that would save us two years in which the emergency tour plot would remain at 17 months. People are expected to spend far too much time away from their families and their homes and it is regrettable that they will be asked to do so in the next two years.
On the question of the emergency tour plot, I do not want to go over old ground or to spell out eternally the point that I have just made. I should like, however, to refer the House to an answer, which I received on 17 February, concerning units due to replace those currently in Bosnia. When it goes to Bosnia, the 1st Prince of Wales Own will have had barely 12 months since its last emergency tour. Even more disturbing is the fact that those elements—and I believe them to be substantial—of 21 Engineer Regiment that will take over from 35 Engineer Regiment in a couple of months' time did an emergency tour in Northern Ireland last September.
A gap of that kind between emergency tour plots—especially ones such as Northern Ireland and Bosnia, which are high-risk operations—is not sufficient. At present, we are putting far too great a strain on our soldiers by asking them to undertake such commitments with such frequency.
I should like to have clarification of one or two of the points that have been made about the extra 5,000 troops to be put into the front line. We have been told that about 1,300 of the 3,000 additional men will go to the two

933
restored battalions, and that the other 1,700 will be added to armoured regiments, the logistics corps and public-duty infantry battalions.
"to reduce the need for augmentation from other units for operational tours".
The Select Committee will look further at this question. I should be grateful for an assurance that the 300-strong public duties increment, which has always been planned, is not included in this number and that it is additional to the 5,000 to whom we are referring. With regard to the 5,000, I shall be watching with some interest to see whether any misuse is made of mirrors in moving the 2,000 personnel from one part of our armed forces to another.
While I am on the subject of reprieve, I cannot resist saying that during my trip to Bosnia I was astounded to be told by the Cheshires that my right hon. Friend the Minister for the Armed Forces, who had been in Bosnia the previous week, had told the Cheshires that he personally had reprieved them. [Laughter.] That is how it was put to me. It is a version of events slightly different from what I had understood to be the case. Anyway, I look forward very much to my right hon. Friend's being able to claim the reprieve of the other seven battalions which I hope will in due course be added to our strength.
I should like to take up another point that my right hon. Friend the Member for Bridgwater made. I am glad to say that on this occasion I wholeheartedly agree with my right hon. Friend. I refer to the review of our use of troops in Northern Ireland. It seems that the only alternative to having additional forces is to find a way in which, without in any way reducing the cover for Northern Ireland and without increasing the risk in the Province, the troops who are involved can be used more efficiently.
We have heard some very good points about the areas in which we may be able to replace soldiers with members of the Royal Ulster Constabulary. I feel strongly that we should be able to find a way of achieving a reduction from the very high number of soldiers–19,000—we now have in the Province. I think that I am right in saying that, when the noble Lord Bramall was Chief of the General Staff, we had only 9,000 soldiers in Northern Ireland. That is not so very long ago, and the risk at that time was probably perceived to be as great as it is now.
We should look very closely for ways in which a greater part of the peacekeeping and policing role in Northern Ireland could be transferred back to Northern Ireland itself, with the emphasis obviously on the Royal Ulster Constabulary. I very much hope that we shall be able to find a way of doing something along those lines.
The Select Committee has been criticised for not looking in greater detail at proposals concerning means of reviewing commitments. I do not see how we could reduce other commitments. I do not agree with some of my hon. Friends who asked whether it was desirable to keep our forces in, for example, Belize, where we provide a very useful service and have the advantage of being able to train our men in jungle warfare. Nor do I see any immediate prospect of our being able to withdraw from the Falklands. With the sole exception of a close look at Northern Ireland, it would be very difficult properly to reduce our commitments.
We are on much more difficult ground when we talk about potential new commitments. There is no doubt—I do not think that this will be disputed—that the world is a very different place. The peace dividend for which we looked two years ago has disappeared. We cannot now
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look forward with any hope to a world in which we can afford to lower our guard as a result of the break-up of the Soviet Union.
My right hon. Friend, in opening the debate, talked about putting this whole question in a global context. I happily do so. I fear that the former Soviet Union increases rather than lessens the likelihood of war. With the stand-off between the old Soviet Union and the western alliance, we had the mutual nuclear deterrent, which had kept peace in the world for many years and looked likely to continue to do so. The Soviet Union has broken up, but there remains a collection of extremely powerful countries. The Ukraine still has 650,000 men under arms and 178 nuclear missiles—quite enough to blow the whole of Europe out of the water. Were those resources to be misused—were there even a threat of their being misused—we should need armed forces and a deterrent of the kind that was required when we were facing the Soviet Union.
Russia itself, currently in good and trustworthy hands, may not remain so. President Yeltsin is not secure, and the reforms are by no means safe. There is a very real danger —a danger of which the Russian leadership itself is acutely aware—that Russia will again fall into bad hands, the hands of ideological, militaristic communists. Were that to happen, the west, including this country, would need to deploy weapons not very different from those that have been needed for the past four decades.
My hon. Friend was right to say that the Americans are cutting their defence, as are most of our European allies. I do not suggest that we should not cut ours; I say that we have cut too much and that our allies are cutting too much. The fact that our allies are cutting back is no excuse for our doing so. I note with some amusement that, in the debate in another place on 10 February, Lord Orr-Ewing, who was a Defence Minister 30 years ago, pointed out that at that time he had looked at the 20 years preceding his term of office. He had found 54 operations in which British forces had taken part. None of them had been anticipated by the Ministry of Defence and none had been allowed for in the forward planning of the day. I take some comfort from the fact that nothing has changed, but it is slightly cold comfort.
Finally, the Army needs leeway for the reason that I have just mentioned. We cannot plan accurately for or know precisely what we shall be called on to meet in the next 10 to 20 years. We now have a high-tech Army with immensely expensive equipment. We cannot make it and unmake it according the peaks and corresponding dips in our economy. We must take the long view—that view is expensive, but we must not shirk from it.
With due deference to my hon. Friend the Member for Davyhulme, I shall quote his grandfather, Winston Churchill, who wrote, on 17 December 1904:
"The Army is not like a limited liability company to be reconstructed, remodelled, liquidated and refloated from week to week as the money market fluctuates.
It is not an inanimate thing, like a house to be pulled down, or structurally altered at the caprice of the owner; it is a living thing.
If it is bullied, it sulks; if it is unhappy, it pines; if it is harried, it gets feverish; if it is sufficiently disturbed, it will wither and dwindle and almost die; and when it comes to this last serious condition, it is only revived by lots of time and lots of money".
This country made the error of cutting back too hard on its defences in the late 18th century and again in the late 19th century and before the first and second world wars.

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We have not yet reached the stage where the Army has withered and died; it is strong and healthy, but it is too small. We must ensure for the future that we learn the lessons of the past and that we maintain and nurture the Army at a level that will match the needs of the years to come.
6.51 pm
Mr. Ken Maginnis: Despite the helpful, constructive and informative contribution from the hon. Member for Upminster (Sir N. Bonsor), I find the debate depressing. My morale must be nearly as low as that of the soldiers who will face redundancy when the announcement is made tomorrow. Morale is low because every soldier, like most hon. Members, know that this decision, like too many others taken by the Government, has been made mainly, although not exclusively, on the basis of financial considerations.
The terms of the redundancies have not been planned as one might have expected. A further search by the Treasury for more financial savings next year and the following year will squeeze resources for the military even further. I do not take the same degree of satisfaction that the Minister of State for the Armed Forces took from the fact that there are many volunteers for redundancy. My experience is that the officers and other men in the Army are wholly professional. They joined the Army for a career and to do a specific job. The fact that there are volunteers for redundancy suggests the depth to which the morale of the services has fallen.
Mr. Archie Hamilton: Most of the non-commissioned ranks do not serve for more than 22 years. The hon. Gentleman talks about a career in the Army, but it is, by its nature, only a first career. Many will inevitably leave at about the age of 40 and have a second career until they retire. Therefore, the people volunteering for redundancy will often be leaving only a few years before they usually would, and they receive a substantial capital payment when they do so.
Mr. Maginnis: The Minister's response is peculiar. When 3 million people are unemployed, I cannot understand why anyone would wish to volunteer to leave the Army. If the Minister is implying that the soldiers who are volunteering for redundancy signed up for 22 years but are leaving after 17 or 18 years, he is admitting that the Army is losing its most experienced soldiers when a reorganisation is taking place; that cannot be good. He said that the vast majority of officers who were to be made redundant had also volunteered, and that cannot be good, either.
I have two questions for the Minister. First, why is the Army feeling much more strain under "Options for Change" than the Royal Navy or the Royal Air Force? I am not advocating that we should lean more heavily on the two latter arms of the services, but I cannot understand why the infantry is feeling more strain. Has the sharing of the pain been unequally distributed? Will the likely future commitments exacerbate the pressures on the Army, specifically the infantry, more than those on the other two services?
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I ask my second question reluctantly. Should such vast amounts of the defence budget for the Army be devoted to the allied rapid reaction corps? Does Britain's contribution of a single armoured division justify its disproportionate cost, especially when future commitments appear to be of low intensity?
Many hon. Members have said that the unprecedented reduction in the number of infantry battalions was far too severe and badly thought out. Recent minor adjustments, which reprieved two battalions, are of course welcome, but I am aware that a certain sleight of hand is being employed. I refer specifically to the enforced amalgamation of four Royal Irish battalions into two battalions, which occurred without adequate consideration of operational needs in Northern Ireland. I shall deal with Northern Ireland later.
Another issue that needs to be examined especially carefully is the extent to which the remaining battalions are undermanned and whether they are likely to achieve their establishment. Mention has been made today of the Cheshires in Bosnia and their need to be reinforced with 150 members of the Royal Irish Regiment. I noticed that every other regiment serving in Bosnia was mentioned, and I take some pride in drawing attention to the fact that 150 members of the Royal Irish Regiment are there: perhaps it is because they are so professional and have integrated so well under the command of the Cheshires that nobody has noticed the difference. Someone who was in Bosnia last week told me that they are playing their full part and have integrated very well, to the extent that, on the Cheshires' special day, they joined them in wearing the oak leaf.
If we continue to overstretch the remaining battalions, it seems inevitable that the problem of overstretch will increase. As the hon. Member for Motherwell, North (Dr. Reid) pointed out, young soldiers currently serving three, six, or nine years will come under increasing pressure from their young wives and families not to continue, simply because of the increased periods of separation. The result is that fewer will continue in the forces after their initial period of service. That vicious circle must be addressed urgently.
The Minister will recall that, with some reluctance, my party supported the amalgamation of the Ulster Defence Regiment with the Royal Irish Rangers. We did so because we believed that it would be in the best interests of the new Royal Irish Regiment. We recalled, of course, that the Royal Irish Rangers had derived from the Royal Ulster Rifles, the Royal Irish Fusiliers and the Royal Inniskilling Fusiliers. Once, the part of the United Kingdom from which I come contributed three line regiments. With amalgamation, we were left with one line regiment—the Royal Irish Rangers—and the Ulster Defence Regiment, which, despite repeated promises, was, sad to say, always treated as the poor relation, although the soldiers of the UDR must operate under pressures which no other regiment has to endure.
We wanted to retain our regiment of the line, so what was proposed seemed to make reasonable sense. Certain promises were made at the time. For example, we were told that, once the amalgamation had taken place, there would be a period of consolidation and that no changes would be enforced for at least a year. Instead, because we require two additional battalions to be sent to Northern Ireland —six-month roulement battalions, it should be remembered—they are given their own TAORs—tactical areas of

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operational responsibility—at the expense of Royal Irish battalions which are there permanently and are commanded by officers on a two-year attachment.
That does not make sense. A roulement battalion coming in for six months has a learning curve of up to three months with, at the end, a rundown period of two, three or four weeks. To remove from the command of TAORs the resident Royal Irish battalions and to replace them with roulement battalions is arrant nonsense.
Many fail to understand the basis on which amalgamations have taken place. For example—I shall use the old UDR terms–11 UDR was amalgamated at one stage with 2 UDR to become 6 UDR. If hon. Members find that confusing, I assure them that I am equally confused, because we now have the amalgamation of the old 3 UDR with the old 11 UDR, forming 3 Royal Irish. One need only look at the amount of territory that that battalion must cover, and remember that one half has its own TAOR while the other half is placed under command of a roulement battalion, to understand how difficult it is for any commanding officer to maintain, under the most difficult circumstances, any sort of cohesion and morale.
The same happened to my old battalion, 8 UDR. It was amalgamated with 2 UDR to form 8 Royal Irish, one half of which comes under the command of a six-month roulement battalion and the other half of which has a TAOR of its own. Those changes were made selfishly—as it were, for political reasons in the military sense—and gave little thought to the real needs of the people of Northern Ireland and those serving in that difficult theatre.
I do not want to be told that that happened because six-month roulement battalions are capable of performing duties for much longer periods than are the members of the Royal Irish. The position is changing because of the pressure on battalions to return to operational duties within a shorter time scale. The hon. Member for Stockton, North (Mr. Cook) spoke of the great stress under which soldiers operate. Can the Minister justify full-time members of the Royal Irish Regiment having to be on duty, week after week, for between 70 and 80 hours? Does he have any concept of how that affects the entire families of those soldiers—their wives, children, mothers and fathers? The strain is enormous working under such stressful conditions, remembering that Royal Irish soldiers are never off duty. They are on duty, whether literally or at home with their families.
I fear that such stress is forcing young men to leave the regiment after serving their initial three or six years. The human resource in Northern Ireland is finite. We do not have scope to work our soldiers to the extent that is now required of them. They should not be treated as cheap labour, putting it bluntly. Nor should they be an alternative to the RUC. I listened carefully to the comments of the hon. Member for Upminster about the RUC accepting more responsibility in less dangerous areas, if it is possible to find such areas in Northern Ireland. The hon. Gentleman will be aware how easy it is for the IRA and other paramilitary organisations, which are mobile, to move into previously quiet areas.
If those areas exist and can be identified, of course it is fine to say that the RUC should assume the duty of policing them on its own. However, I hate to disillusion hon. Members about what seems a logical suggestion, but until we have a political dedication that matches the dedication of the police and the military, that will not be possible.
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Over the past 20 years politicians have dedicated far too much time and effort in Northern Ireland to trying to placate those who refuse to be placated. The upturn in violence is a direct result of that. Everyone in my party, and everyone in the House, deplores the upsurge in loyalist violence—but that upsurge is a direct result of some nonsensical political decisions that have been made over the years.
It is no slight on the RUC to say that the situation today is less conducive to their policing on their own than it was three, four or five years ago. I know that hon. Members will be disappointed to hear that.
There is something else that I want to say, but it is futile for me to mention it, because I do not think that my making a proposal will have the wished-for result. None the less, it is especially disappointing that, when adjustments were made to the number of battalions, no one thought of trying to retain two general service battalions for the Royal Irish Regiment. I believe that that would have been worth while partly because, with six home defence regiments, we need to bring on young officers who will eventually take over as commanding officers of the home battalions. Furthermore, great benefit could be achieved by giving NCOs, including senior NCOs, scope to move away from the home battalions for periods of service with general service battalions.
My main criticism of "Options for Change" is that, when the proposals were made, they did not properly assess the needs of our Army and of the United Kingdom.
I shall allude briefly to Bosnia. There was much truth in what the hon. Member for Upminster said about the position in which we shall find ourselves there. I have never believed that we should be in Bosnia with such an open-ended and ill-defined commitment. It is folly to commit any of our ground troops without some artillery and air support. The problem will be exacerbated if the Americans, with their high-level drops, come into the equation. The frustrated combatants in the area will find that our troops are the only people on whom they can vent their anger.
I finish by congratulating all our forces who carry out their many and varied duties throughout the world—not least in my part of the United Kingdom—with such dedication and discipline—a discipline which I do not believe that any other army in the world could match.
7.15 pm
Mr. Andrew Robathan: I am not sure whether I should declare a pecuniary interest in the debate. To be safe rather than sorry, I should tell the House that I am in receipt of a very small military pension.
I wholeheartedly endorse the congratulations that the hon. Member for Fermanagh and South Tyrone (Mr. Maginnis) offered our armed forces, who do a splendid job. In a society that has increasingly little regard or respect for its institutions, the Army is generally respected and retains the affection and support of the vast majority of the British population—as, indeed, do the Royal Navy and the Royal Air Force. The Minister of State said much the same. Deservedly, the Army remains a respected profession at all levels of society. Today's troops are serving all over the world and doing a fine job in support of our national interests, earning continuing respect.
The Army remains above politics such as we see in this place, because its allegiance is to the Crown and it remains

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motivated by traditional values that most people respect, such as loyalty and service. The hon. and learned Member for Fife, North-East (Mr. Campbell) talked about the finest traditions of the British Army. I was delighted to hear those words coming from the Opposition, because those traditions and values are respected, and are enhanced by the excellent regimental system, which I should not like to see harmed in any way.
It is my intention not to denigrate that fine institution but to suggest means by which it may be improved for the 21st century. The Minister knows that I, like many others who have spoken in the debate, am unhappy about "Options for Change" and the especially severe reduction in our infantry manpower. I agree with almost every word that my hon. Friend the Member for Upminster (Sir N. Bonsor) said.
The Minister may disagree, but I am told by many people in the Army that there is now severe overstretch in our forces. The Foreign Secretary has said as much. Furthermore, the overstretch and the planned reductions have led to a worrying situation with regard to morale and spirit. The hon. Member for Motherwell, North (Dr. Reid) —sadly, he is not now in the Chamber—said the same. This is one of very few occasions on which I agree with him.
The implementation of the redundancy programme, in the present climate, is leading many excellent officers to apply for redundancy. Those are the dynamic people who are capable of finding civilian jobs even in the recession. The programme is encouraging first-class expertise to wither away. It would have been better by far to have made a more objective assessment of the soldiers and officers that we require for the future. Many excellent officers and soldiers of all ranks wish to remain in the Army, but it is at officer level in particular that valuable expertise is being lost. As the Minister said, long careers involving people over the age of 40 are largely restricted to officers.
Instead of cutting manpower and overstretched regiments, Ministers might have considered a thorough reappraisal of the command structure. In my opinion, it is grossly top-heavy. There are to many chiefs and not enough Indians. That was illustrated when, as part of "Options for Change", the chiefs decided to cut the Indians but, as I understand it—my right hon. Friend the Minister of State for the Armed Forces may correct me —they have not yet decided how many of themselves to cut. By considering the serious savings to be made in the higher echelons of the armed forces, my right hon. and learned Friend the Secretary of State might find that he has greater scope for saving more battalions of infantry.
It is not for cost purposes that I make remarks on the command structure: it is because I believe that a much better service could be provided with less bureaucracy. At present we have a top-heavy bureaucracy which strangles initiative. In any conflict it is seen immediately to be largely irrelevant. Few people would disagree that lean command structures in organisations, in business and industry, as well as the armed forces, are more efficient. They make decisions more quickly. They can find solutions to problems more easily.
I fear that the Ministry of Defence and the Army are swamped by huge staff structures, both civilians and
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military. That is not to criticise the people in those staff structures, because they work extremely hard, whether soldiers or civilians, and for good motives. However, that is not to say that the work could not be reorganised more efficiently.
I have seen able, hard-working and intelligent individuals beavering away at paperwork which is entirely unnecessary. Their efforts are wasted. The work is nugatory. My hon. Friend the Member for Upminster mentioned 55 contingency plans, none of which was ever used. That is the sort of work which is not necessary.
A senior person at the top of a department—in the Army, a senior general—requires work to justify his existence. Therefore, there is an enormous amount of work. Of course, all the generals need to visit military establishments. Therefore, everyone is required to work hard to ensure that the visit is a success and not the disruption which everyone can often see that it might be.
Depending on rank, a general requires back-up officers. That is not unreasonable, and I support it. So one major general will probably require at least one brigadier, a brace of colonels and a few lieutenant colonels and majors to keep him and his department working. All those important people in the structure, not surprisingly, interfere where they should not do so.
The hon. Member for Fermanagh and South Tyrone spoke about Northern Ireland. I recall that in the Province, every activity of the guardsman on the street would be monitored not only by the corporal in charge of his patrol, the platoon commander in charge of his platoon and the company commander in charge of his company, who all had reasonable input into his operational needs, but by the commanding officer, who had some good interest in what he was doing. Then there was a brigadier who was fascinated with the activities of the guardsman and interfered in operations which could not possibly be within the scope of his knowledge. There was a major general, and there is still, the commander of land forces, who was equally fascinated by what was happening on the streets.
On top of it all, there was a general officer commanding. They were all excellent men. The general officer commanding also had his input into what was going on. The minutiae and detail of operations do not require everyone at every level from lieutenant general downwards to involve themselves in the activities of private soldiers. Nevertheless, I fear that this culture has been inculcated into the ethos of peacetime command.
Of course, reductions are planned in the number of senior officers in proportion to the overall reductions in the size of the armed forces, including the Army. I am not sure that we know yet what reductions are planned. But we should take a more radical look at the structure. The figures that I have are for 1992. In that year, there were eight full generals to 10 lieutenant generals in the Army. That must amount essentially to a one-on-one command structure, which I was always taught was not a good idea.
There were 54 major generals—as many as there are battalions of infantry. Yet in a war, a major general is expected to command about 12 battalions or regiments. To turn to the Ministry of Defence, let us take as an example the quartermaster general's department. The quartermaster general has a director-general of logistic policy, a director-general of transport and movement, a

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director-general of ordnance services and a director-general of equipment support, all of whom are major generals and, I am sure, excellent, hard-working people.
The director-general of equipment support has five directors of equipment support under him—another five brigadiers, I assume. All those people deal with important matters, but one must ask whether they are working to best effect and whether more junior, less exalted people could do the job better with fewer staff and less bureaucracy. Could it not be streamlined?
In equipment procurement, I remember the "great success" of the Nimrod programme and the even worse success of the SP70—the self-propelled gun 1970. After about 18 years of work on the SP70, it was scrapped. I do not know how many millions of pounds went down the tube with it.
Let us examine the other armed forces. In 1992 there were the same number of air chief marshals—six—as there were in 1950 and 69 per cent. of the number of air marshals and air vice marshals—a total of 52 in 1992 compared with 75 in 1950. Yet the total number of personnel had fallen from 183,000 to 83,000. As I understand it, in the Air Force a flight lieutenant normally commands an aeroplane. A squadron leader commands a flight. A wing commander commands a squadron. A group captain commands a wing. In the Navy, the number of admirals to ships does not bear examination.
One of the difficulties of the structure of the Army is that young men and women join the Army at 17 or 18 at all levels for reasons about which one reads on recruiting posters. They join for camaraderie, mates, excitement, adventure, travel and a trade. You name it, you will see it. However, the scope for adventure and excitement rapidly diminishes after the age of 30, 35 or 40. But people stay in the forces for reasons of security and career structure.
Therefore, in order to have good senior officers, one must offer a decent career structure. But essentially the armed forces, and the Army in particular, should be for the younger men and women because the nature of service life requires agile,, fit, quick people and similarly agile quick, fit minds. I recall that John Hackett was a brigadier who parachuted into Arnhem at the age of 33. When I joined the armed forces in 1970, he was still a general almost 30 years later.
If we wish to attract able people into the Army, as we do at present, we must provide an attractive, long-term future for able people, but not a career to 55 for all who want it. We need many junior officers but only a few senior officers. So we should encourage most people to leave at the age of 30, 35, or 40. Unfortunately, in a sad catch-22, it becomes increasingly difficult to find a job in civilian life as one gets older. Indeed, some of us have to come into Parliament because we cannot find a decent job elsewhere.
The people who are accepted into the armed forces generally go through a difficult selection process. They are generally vigorous spirits with good minds and they have rigorous training. I believe that the Ministry of Defence could do more to encourage business men and industrialists to give former soldiers and service personnel a chance at later ages to enter their businesses. Surely British industry would benefit from some of the dynamism and high standards which are recognised by all sections of the House to be an attribute of many forces personnel.
Indeed, my right hon. Friend the Minister mentioned new measures, including in particular the Services Employment Network. I welcome it and hope that it will
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operate along the lines that I have described. There have been many initiatives for work placement schemes. My right hon. Friend said that they would be increased. It would be for the benefit of companies because they could see whether ex-officers would be dynamic, capable and flexible employers and managers. Dynamism, capabilities and flexibility are required in the armed forces.
If we can achieve a much leaner command structure, the Army could be more outward looking and less introspective for the next century. It could turn to a security policy to co-ordinate national strategy instead of the narrow MoD strategy, which is adopted all too often today.
Looking further forward, we need to reappraise our defence and security needs, but it is difficult to do so with top-heavy organisations. Our future defence policy may need to be more closely linked with foreign policy and Home Office policy in counter-terrorism matters, for national security. Clausewitz said that war was an extension of diplomacy by other means. Perhaps we should simply say that all defence is an extension of diplomacy by other means. The 21st century will need flexibility in reaction to events. The present structure is notoriously inflexible, with too much evidence of entrenched interests.
I do not intend to be negative, and I hope that I have made positive comments on the future of the Army. If the Army is to continue as a respected institution, there is need for a review of its structure. We need fewer staff officers, civilian and military, we need less bureaucracy and we need far fewer senior officers with all that they bring with them so that the front line can concentrate on the proper training and operations, about which we have heard today, which are the proper job of the Army.
I value tradition, and I value the old regiments. I value the paraphernalia of bands, of uniforms and of mascots. We have one of the best armies—if not the best army—in the world with all that paraphernalia. Let us not concentrate on that and suggest that everything should be rationalised. Our Army is the envy of most of our allies and of most of our enemies. I am not sure that we are allowed to talk about our enemies any more, if they exist.
I know that, in the Ministry of Defence, Parkinson's law has had a field day, as it has had in the rest of Whitehall. There are too many bureaucrats who exist purely to write letters to each other. I urge my right hon. Friend to change the peacetime culture, and to make the Army and the Ministry of Defence better for the 21st century. We should encourage young officers to join for a short while and we should then encourage industry to assist in resettling them into civilian life. That would make for a leaner, more effective and cheaper command and organisational structure throughout the Army. Let us have fewer chiefs and more Indians. That may help to keep our excellent Army and the rest of the armed forces respected both at home and throughout the world.
7.31 pm
Mr. Andrew Welsh: I am not sure whether the hon. Member (Mr. Robathan) should ever be employed by the armed forces recruitment office. He gave a very depressing picture of the Army chasing its own bureaucratic tail. That is not my impression of its operation, or of the requirements that society places on the armed forces.

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The hon. Member asked whether the Army could be streamlined. The answer must be yes, although it depends on what we are streamlining. We ask the armed forces to walk the paradox of democracy. We expect them to be trained in the arts of war, although in the hope that they are never employed. When we ask them to go into action on our behalf, we expect and demand the highest standards of quality of end product. Thankfully, we have never yet been disappointed by what the armed forces have produced in extreme crises.
The Government still have not got the regimental amalgamation and conventional defence policy correct. They are wrong in their approach. I welcome the cancellation of the amalgamation of the Royal Scots with the King's Own Scottish Borderers, but I continue to press for the cancellation of the merger between the Gordon Highlanders and the Queen's Own Highlanders. Having got their corrections half right, I encourage the Government to get it absolutely right and to retain the Queen's Own Highlanders and the Gordon Highlanders.
The present altered programme produced by the Ministry of Defence represents a quick fix which does not address the problem of overstretch in the infantry because it merely scratches the surface of the problem. I could employ arguments against the remaining amalgamation of Scottish regiments based on economic and social grounds, such as the impact of new unemployment in areas of high unemployment, especially during a recession. There are also the effects on local authorities because there are extra demands on scarce housing and on other resources. A compelling case against amalgamation could be made on those factors.
Instead, I shall concentrate my opposition to the regimental amalgamations on military and defence grounds. I hope that even the Ministry of Defence will recognise those arguments. The Government have not taken on the overstretch argument. The situation facing the world is far worse than the Ministry of Defence will yet admit. In answer to my hon. Friend the Member for Banff and Buchan (Mr. Salmond), the Secretary of State said last month:
"I am satisfied that at present we can meet all our obligations without undue overstretch."—[Official Report, 12 January 1993; Vol. 216, c. 750.]
Those words may come back to haunt the Secretary of State. His certainty is not shared.
It may be that, yet again, the Government are overtaken by events. In a series of spheres of operation, the Government are prone to being overtaken by events. They are dragged into policy decisions by outside forces and events rather than taking policy decisions themselves. It seems that defence is included in the list.
There have been significant changes in the strategic environment since 1990 which could not have been foreseen when "Options for Change" was produced. Those changes include the violent break-up of Yugoslavia, growing instability in the middle east and the growing military commitment to the United Nations. Other events loom on the horizon. If the Owen-Vance peace proposals are accepted or if another peace proposal is eventually implemented in Bosnia, there may be significant implications. I have not yet heard the Government address those potential problems.
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Despite those problems, the Secretary of State, in evidence to the Select Committee, referred to
"a combination of developments, none of which, we believe, in any fundamental sense changes the assumptions that were made at the time of Options."
The Committee replied in its report:
"We find this barely credible."
The Committee is not alone in finding the Government's response less than credible.
The Select Committee slated the amalgamation in its report. It states:
"everything in the past three years leads us to the bleak conclusion that the proposed rundown goes too far, and that …even minor contingencies are imposing an unacceptable strain on the Army."
The report makes it clear that the developments of the past three years
"point to a greater rather than a lesser demand for armed forces capable of interventions over a wide spectrum of activity."
The number of infantry battalions envisaged is simply too few to meet all peacetime tasks. The Ministry's own target of 24 months between operational tasks is not being met. Even a slight change in commitments will make it absolutely impossible. Since 1991, three extra units have been deployed on six-month unaccompanied tours. Even without taking that duty into account, deployments filled by the infantry should be backed by 10 extra battalions if the two-year period between tours is to be maintained. The add-back given by the Government of two battalions that were scheduled to be lost by amalgamation still leaves a deficit of eight battalions. The Ministry has unilaterally decided that the two-year interval is essential if operational efficiency and morale are to be maintained, yet the current tour interval is 15 months.
I draw to the Minister's attention words in a letter sent to all Scottish Members by Lieutenant-General Sir John MacMillan
"The reprieve of two units does not mean that the interval will increase. It merely means that it will not decrease quite so far … By the MOD's own criteria the infantry is going to be overstretched unless or until unit deployments are reduced."
I have not heard the Government addressing the overstretch issue this evening. I should like to hear the Minister meet the points made on an all-party basis by the Select Committee and by the military.
The Select Committee clearly agrees with the argument on overstretch. It states:
"In the light of the chronic overstretch being experienced by the Army, which shows no sign of abating, we recommend that the Government cancel all amalgamations or disbandments of UK infantry battalions currently planned."
Again, there is clear disagreement between an all-party Committee and the Government. I look to the Government to refute the arguments being put. If they cannot, they should agree with what is being said to them and they should reconsider overstretch and the requirements that we place on the military.
If the Government do not reconsider, the inability to meet the 24 months between operational tasks will have a number of serious consequences. Army units are unable to train for high-level warfare. Only one unit instead of seven is presently being trained in the Army's top-level training unit. If troops were required to go back to the Gulf, for example, they would find it more difficult to adapt to the situation quickly because of the training constraints. The lack of a 24-month interval will place intolerable strains on

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the family lives and marriages of soldiers serving in the Army and it will be much more difficult to retain staff long-term the longer these conditions are maintained.
The Army has traditionally made up in quality what it has lacked in quantity. What certainty can there be that that will continue if it cannot maintain the two-year interval which the Ministry of Defence has said is essential? The Government should never forget that every European country, with the exception of Eire, has conscription and can therefore quickly mobilise in an emergency. The United Kingdom strategy has always relied on full-time professional forces maintained at the highest readiness. Training is thus essential, and the Government must look again at the strains that their policy is imposing on the armed forces.
The Ministry of Defence based its decisions on which units should be amalgamated on simple projections of the numbers of young men in given recruiting areas, irrespective of whether they had proved to be good recruitment areas in the past. The policy failed to recognise that Scotland has always sent more men to the forces than the United Kingdom average. At present, 12 per cent. of the Army comes from 9·8 per cent. of the United Kingdom population. That is in no small part due to the close links between regiments and their recruiting base. The amalgamations will break the tie on which recruitment has depended. Experience of previous amalgamations has been that when new regiments cover larger geographical areas local ties are broken or weakened.
We are about to sacrifice an intangible asset; we do so at our peril and long-term cost.
Defence requirements are being distorted by the Government's obsession with Trident nuclear weapons. Defence expenditure has declined from 5 per cent. of GDP in 1985–86 to 3·8 per cent. in 1992–93 and is projected to decline even further to 3·4 per cent. in 1994–95, so it is clear that something must give. That something should not be our conventional forces and certainly not our Scottish regiments.
In its first report on the "Statement on the Defence Estimates 1992", the Select Committee said:
"Either sufficient resources must be found or the Government must acknowledge its inability to meet all the commitments and take the political decision to reduce or abandon some of them."
I agree wholeheartedly. The one commitment that the Government must abandon on defence and cost grounds is the Trident programme—not to mention the other nuclear missiles which they are buying and cannot possibly use—and the one commitment that the Government must make up their mind to honour is the one to all Scottish regiments and battalions.
Mr. George Kynoch: I wonder whether the hon. Gentleman could explain that to the people of Rosyth. I believe that he is also arguing that it should get the Trident nuclear contract.
Mr. Welsh: The people of Rosyth know what the Government are doing to them and how insecure employment is under this Government. If there were a move towards more spending on conventional forces, there would be jobs at and a future for Rosyth. The Government cannot guarantee the workers that.
I repeat my plea to the Government that they should rescind their decision and retain the Queen's Own Scottish Highlanders and the Gordon Highlanders, whose record
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of valour, expertise and service merits their retention. The logic of our strategic needs demands their continuing and independent contributions. I hope that the Government will listen and take action on this plea.
7.43 pm
Mr. Winston Churchill: The hon. Member for Angus, East (Mr. Welsh) would not expect me to agree with him about Trident, but I endorse his tribute to the role of the Scottish regiments in the British Army and the disproportionate contribution of recruiting in Scotland, which is severely threatened by the "Options for Change" cuts. I also echo the tribute paid by the hon. Member for Fermanagh and South Tyrone (Mr. Maginnis) to all our forces serving in Northern Ireland—in particular to the men and women of the Royal Irish Regiment, who serve there 365 days a year. We owe them a great debt. On a personal note, I commend the hon. Gentleman for the gallantry that he has shown for so many years serving in what was the Ulster Defence Regiment.
When the cynically named "Options for Change" was announced in July 1990, no options were brought before the House of Commons or before the nation: all options were foreclosed by the Treasury. At that time, the world was a different place. In the wake of the dramatic transformation of the Soviet Union, the tearing down of the Berlin wall and the overthrow of the Ceausescu dictatorship, hopes were high that we might be moving into an era of "peace in our time". Sad to say, and as before, such expectations proved illusory.
This complacency was abruptly shattered within a week of the publication of "Options" when Saddam Hussein invaded Kuwait and we found outselves having to fight a war in the Gulf which stretched even our pre-options armed forces to the absolute limit.
Since then, with the fall of Gorbachev and the spread of civil war and instability across vast areas of the former Soviet Union and the Balkans, the optimism that characterised "Options for Change" cuts has been shown to be utterly misplaced. Moreover, "Options" failed to take account of the already tiny size of Britain's armed forces. The Government seemed utterly oblivious of that when they embarked on reorganisation. The fully mobilised strength of Britain's Army at the time stood at 424,000 men and women. Post "Options", by the turn of the century it is likely to be no more than 300,000. That compares with the Swiss army of 600,000 the Swedish army of 750,000 and the army of tiny Finland, which is 700,000 strong.
Of course, ours is a professional, full-time Army. That fact is continually reinforced when we visit the forces of the Crown. The Defence Select Committee was privileged only in the past week to visit British forces in Bosnia; that brought home to us the fact that ours is, without exception, the finest Army in the world.
Ultimately, however, it is not only calibre that counts —important though it is. There comes a point when numbers count, too. The numbers have already been cut far too much. Already our commitments in Bosnia and Ireland are straining our Army to the limit. Having recently returned from Bosnia, I join my colleagues on the Select Committee in paying tribute to the wonderful job that our forces are doing there. Some of the United Nations forces arrived in theatre with trainer shoes and little sports bags—that was the extent of the back-up they

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had. I am pleased to say—this is by way of tribute to our Ministers—that our forces arrived in theatre wanting for nothing in terms of their equipment and their capability to do the limited job of humanitarian assistance assigned to them.
There are almost as many Royal Engineers in this theatre as there are members of the Cheshires—the Royal Electrical and Mechanical Engineers and many other units are involved. The back-up is fantastic and it is the envy of all the other nations involved in the United Nations peacekeeping force in Bosnia and the former Yugoslavia.
The Government have acknowledged that three extra battalions are required on account of unaccompanied tours which were not foreseen at the time of the "Options for Change" statement; two in Northern Ireland and a third, reinforced, unit in Bosnia. The Government's objective of a 24-month gap between tours means a requirement for an extra 15 battalions.
While the House welcomes the Secretary of State's reprieve for two battalions, that represents but one seventh of what is required to bring the emergency tour plot up to a 24-month interval. On the Government's calculations of the figures involved, we are still 13 battalions light and that is before any response to an outbreak of peace in the former Yugoslavia, which might require the deployment of a reinforced British brigade as part of a United Nations force. The reprieve of 3,000 men, out of the 40,000 to be cut from the Army, goes nowhere near meeting the urgency of the situation.
Neither the Ministers, the mandarins nor the Ministry of Defence's army of desk-bound warriors will pay the price for the overstretch of the British Army. It is the Tommy at the sharp end who will pay the price, as has been brought home time and time again to those members of the Defence Select Committee who have had the opportunity to visit the Army in their operational bases.
For instance, in Northern Ireland we found units that had spent 269 nights out of bed in a single year. Just before Christmas I visited the 2nd battalion of the Light Infantry at Tidworth barracks on Salisbury plain, which had been deployed to Northern Ireland four times in two years. My right hon. Friends on the Treasury Bench cannot treat men and their families in that fashion. Those members of the armed forces who depend on us deserve better than that.
If the Vance-Owen plan succeeds—we must all hope that it does—and there is a high-level political agreement, a United Nations force will be required to translate that into peace on the ground and it is variously estimated at anything between 50,000 and 100,000 men. We shall be invited to contribute about 7,500 men, which is a reinforced brigade and represents an additional 5,000 British troops in the region. At that point, "Options for Change" will go by the board, because, given the already overstretched state of the Army, there is no way that such an addition can be accommodated.
The time has come for an urgent reappraisal of commitments and resources. Meanwhile, there should be an immediate halt to all regimental amalgamations and suspensions of armoured and infantry units, as unanimously recommended by the Defence Select Committee. Ten regiments should be reprieved from amalgamation—adding back five—and Army manpower
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should not be allowed to fall below an absolute minimum of 125,000, which would require the adding back of about 6,000 men according to present plans.
In opening the debate, the Minister of State for the Armed Forces helpfully costed the Defence Select Committee's recommendations at £200 million per annum. He paraded that as an enormous potential burden on the taxpayer, when it is but a tiny fraction of the defence budget let alone of Government expenditure. It has to be set in its proper context, against Government plans to spend £350 million during each of the next two years to make those men redundant.
As my hon. Friend the Member for Upminster (Sir N. Bonsor), the Chairman of the Defence Select Committee, made clear, that is not the end of the cost of the redundancies but merely the beginning. We must also consider the loss of income tax and national insurance contributions, the cost of housing allowances and the unemployment and social security benefits that they will draw. All told, it is unlikely that the cost to the taxpayer of going ahead with "Options for Change" during the next two years would be less than £1,500 million, which effectively doubles the redundancy costs that the Government have acknowledged and published.
I submit to the Secretary of State that, for the same cost, every one of the remaining threatened regiments could be funded until the year 2000. He and his colleague, the Chancellor of the Exchequer, should deal with that problem. The time has come for the Secretary of State and his ministerial team to go into battle for the British Army against the depradations of the Treasury. They owe it to the famous regiments that are facing extinction, many of which have a glorious history of gallantry and sacrifice going back 300 years, as well as to the soldiers, and especially the non-commissioned officers and middle-ranking officers who are in the middle of their careers.
Furthermore, I appeal to the Prime Minister to get a grip on the Government's tunnel vision of viewing everything departmentally without taking the overall cost into account. We are told that every Government Department is strapped for cash and I can believe it. That is all except one—the Treasury. For example, if the Secretary of State for Defence comes up with a plan for getting rid of 58,000 service men—I acknowledge that it was not the present Secretary of State but his predecessor —or the Secretary of State for Trade and Industry has a plan for getting rid of 80,000 workers in the mines and related industries, the Chancellor of the Exchequer will instantly reach deep into the taxpayers' pocket to get out a cheque book and write a cheque with many noughts on the end. In the case of the Army, it will be £1·5 billion, and £3 billion in the case of the mines. That cannot be a sensible or a cost-effective use of taxpayers' resources and must be questioned by the House and by Ministers.
There is an urgent need to give the men and women of the armed forces, who are the finest of their generation, the future and the quality of life that they deserve. They do not have a union to represent them, nor do they ask for one. They rely on Ministers and on the House to treat them fairly. They are not only the finest in the world, but the envy of the world, as has been said, so let us give them the backing that they deserve.
7.59 pm
Mr. Frank Cook: This will be something of an historic occasion, as I confess agreement with almost every syllable uttered by the hon. Member for Davyhulme (Mr. Churchill). However, the House should not be too surprised at that, as the hon. Gentleman and I, together with our colleagues on the Select Committee on Defence, have sat through the same inquiries, and the same question and answer sessions, and have made the same visits.
When something is so rational that it hits us between the eyes with the strength of a thunderbolt, we must take notice. I understand that the Minister of State for Defence Procurement—who may respond on behalf of the Government if he is fortunate enough to catch your eye, Mr. Deputy Speaker—is a rational person. I have also noticed that he has been paying careful attention and taking note of everything that has been said.
I commend to the Minister the rationale that has been displayed and discovered today by a number of hon. Members, not only the hon. Member for Davyhulme. The hon. Member for Upminster (Sir N. Bonsor), who has the privilege of being Chairman of the Select Committee on Defence—a post which he fulfils with great distinction—gave the House the benefit of a well-measured resume of the Committee's findings. He laced it effectively with brilliant observation.
I also commend the speech of the hon. Member for Blaby (Mr. Robathan) who, while offering an entertaining piece for our consideration, presented a thesis with many serious ideas. I also commend the contribution of my colleague from the Scottish National party, the hon. Member for Angus, East (Mr. Welsh), and that of the hon. Member for Fermanagh and South Tyrone (Mr. Maginnis), who offered us plenty of serious matters to consider.
I associate myself with the well-presented reques.ts of my hon. Friend the Member for Motherwell, North (Dr. Reid), particularly his demand—dare I call it that—for a full-scale review. I shall dare to call it that as, in October 1988, I made the same plea. That was the only time in my political career to date that I have ever been able to address the House from the Dispatch Box. At the time, Conservative Members tried to laugh me out of court. The chickens are now coming home to roost with a vengeance, and I shall not apologise to the House for gloating a little.
I associate myself with the issues raised by the hon. and learned Member for Fife, North-East (Mr. Campbell), who referred to comments that I made last night about the strange rules of engagement controlling the United Kingdom contingent to the first United Nations Protections Force, which provides the medical and hygiene facilities for battalions engaged in the Krajina region. It is clearly understood that the standards of conduct are such that, if members of the United Kingdom force are required to relinguish their small arms and side arms to Serbs or Croats, those members are instructed to do so. Our forces can shoot to protect their lives, but cannot shoot to retain their weapons, which is a contradiction.
Therefore, my first question is: did the Ministry of Defence and Her Majesty's Government know of that instruction? My second question relates to intelligence gathering. It was our understanding that United Nations rules forbade any exercise intended to gather intelligence of a political, social or military nature. We train our
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service men and women to operate in an area that they try to control through hearts and minds, as well as gun and bayonet.
The roads up to Vitez and Tuzla are partly controlled by obtaining such information and maintaining forms of dialogue with the opposing forces that straddle the area. The Spanish on the Mostar road use a different technique. Spanish is not spoken there anyway and the forces simply dash to and from point A to point Z at a rate of knots. That does not do them too much damage, other than mechanical damage. It seems strange that, in having to maintain a relationship, our men have to break the United Nations rule that does not allow intelligence gathering. Did the Government know about that?
My third question is easy—most of my questions are easy, but I am sure that the Government will not want to answer them. If the Government knew of the rules, are they doing anything about trying to change them, as they seem preposterous?
My fourth question is predictable and relates to the overseas living allowance of service men—an evergreen issue. The problem emerged during the Falkland islands incident and it now applies to UNPROFOR 2. When those forces are moved from Germany to Bosnia-Herzegovina, where they do not go out as there are no nightclubs or cinemas, their overseas living allowance is removed.
There is an additional source of resentment as UNPROFOR 1—which provides the medical and hygiene units for all the battalions in the Krajina region—is paid for by the United Nations. The Government receive an income for the presence of UNPROFOR 1 in that region. But UNPROFOR 2 does not derive that income. I understand that to be the case and I am sure that the Minister will correct me if I am wrong. UNPROFOR 1 service personnel resent the fact that their force is being paid for by the United Nations and they are losing their overseas living allowance by virtue of their presence in Krajina.
I shall now comment on "Options for Change". We have sought and gained a leading role and are responsible for the management structure and future operation—please God—of the Allied Command Europe rapid reaction corps. Participation in the rapid reaction corps is so sought after that it is 250 per cent. over-subscribed—everyone wants a place on it.
A rapid reaction corps requires rapid reaction training, rapid reaction equipment and rapid reaction discipline. However, that in itself is not sufficient; it also requires rapid reaction planning, rapid reaction procurement arid rapid reaction preparation. We may have complete or partial provision in those sectors, but we fall down badly in the most critical sector of all: rapid reaction politicians.
For a period of at least two years we have been flagging the fact that overstretch, particularly of the infantry, has been going disastrously wrong. The fact that it took the Government so long to react is proof positive that we lack rapid reaction politicians, at least in the positions that count.
Mr. Ian Bruce: We should not be too critical about politicians being slow. One of my constituents was told when he first started work at Horton Heath laboratories that they would close in a year or so. He has now retired, having had a full career there. I would not press Ministers to close things too quickly.
Mr. Cook: That intervention may have been enlightening for some people, but I am merely a simple man. I do not know whether to say that the intervention has beggared my understanding or buggered my understanding.
It has taken the Government so long to take on board even a portion of the argument that has been made plain time and time again. Anyone who could believe that the cunning plot hatched by the right hon. Member for Bridgwater (Mr. King) would come right at the end of the day must believe in Enid Blyton. It is quite preposterous. The hon. Member for Upminster told the House that in July we were told that there would be no further arguments about the issue.
The House should take note of the lack of rapid reaction by Ministers. So far all my questions have been easy to answer, but my next one is easier still. What exactly prompted the statement on 3 February? After all the delay, denial and refusals, what on earth happened to make the Government change their mind on that day when 10 days before nothing that they said even approached what they said then? I wonder whether I will get answers to any of my questions.
8.10 pm
Dr. Charles Goodson-Wickes: It is a great pleasure to follow the hon. Member for Stockton, North (Mr. Cook). He is a distinguished member of the Select Committee on Defence whose unanimous report is well worth reading.
In declaring my interest as a Regular Army reserve officer I approach the debate with the same misgivings which last year made it impossible for me to support the Government in the Lobby on the logic and mathematics of "Options for Change". My misgivings are offset only by delight that my right hon. and learned Friend the Secretary of State for Defence recently not only followed my right hon. Friend the Foreign Secretary in admitting the existence of overstretch, a concept which had hitherto been denied, but did something about it, to the relief of our ever adaptable and tolerant soldiers and, not least, their families.
I pay tribute to the Secretary of State for Defence and to the Chairman and members of the Select Committee who have exposed so many fallacies in Ministry of Defence arguments. I still believe that the statistical basis for "Options for Change" is fatally flawed. How is it that arguments produced on pre-Gulf war situations are still considered basically valid? After all, the Gulf campaign was sustainable only because of the collapse of the Warsaw pact, when we were able to cannibalise equipment in Germany to enable our forces to use it.
Until the Secretary of State is able to convince many hon. Members in all parts of the House—I shall not embarrass the many Opposition Members who are profoundly sound on defence matters—that our arithmetic is not up to the standards demanded by the Secretary of State for Education, we shall continue to press the point.
When "Options for Change" was first conceived it was rightly calculated that, owing to the reduction of commitments in BAOR and Berlin, there was no further need for 19 major units. That is fair enough, but "Options for Change" earmarked for cutting no fewer than 31 major units. It took the deployment of British troops to Bosnia and the overdue reinforcement of our commitment to
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Northern Ireland to bring matters to a head. My right hon. and learned Friend responded about a fortnight ago with a modification involving 3,000 men.
The saving of two infantry regiments—it is the infantry which has been hardest hit—reduces the apparent shortfall to 10 major units. I appreciate that in debating such issues it is dangerous to use round numbers. Matching units to manpower is not an exact science, but I still believe that we have got it wrong for our existing commitments, let alone any other commitments. The Minister may tell us of future reductions in our commitment to Cyprus, Belize and even the Falklands, but I remind the House that Bosnia came out of the blue and we had to turn down any commitment to Somalia.
Although we cannot be everywhere, yesterday's debate on international peacekeeping pointed to further developments when British troops would fulfil the role of United Nations peacekeepers. I emphasise "peacekeepers", because there was no mention of peacemaking. I shall keep it at that lower level. It is entirely appropriate for us, as permanent members of the United Nations Security Council, to be willing to give a lead, given our special expertise, in an international peacekeeping role throughout the world.
We have never achieved the aspiration of a 24-month interval between tours in Northern Ireland. Several hon. Members have spoken about that. If my mathematics is right that leads to three possible options. First, we can abandon the unrealistic policy of a 24-month tour interval; secondly, we can stick to that policy and cut commitments, let alone undertake what are quaintly described as "discretionary commitments", which seems a somewhat odd combination of words; thirdly—this is the course that I recommend—we can look at the whole options exercise again and examine it much more rigorously than it has been examined previously.
We are about 6,000 men short, which means that the threshold is wrong by about 6,000 men. That recommendation is not lightly made. There have been profound arguments about costs and counter costs and what can be set against this, that or the other. However, if we are to match our tasks to resources, that is what we need. Only in that way can we get rid of existing problems and confidently look our allies in the face and say that we are fulfilling our roles properly throughout the world.
To argue about whether "Options for Change" was Treasury-driven is sterile. We have gone far beyond that, and have to look at the problem as it is. Of course it would be naive not to recognise the economic pressures. I should like to suggest to the Minister one or two areas where he could make savings which would enable our fighting soldiers properly to fulfil their role.
First, why has "Options for Change" produced an organisation which seems to have very much the same shape but is smaller and has a top-heavy command structure? My hon. Friend the Member for Blaby (Mr. Robathan) will get himself into much trouble with his senior Army friends. I would not want to enter the exercise of working out how many other ranks could be financed for the cost of a general's salary. There were one or two enlightening statistics in yesterday's debate, such as the fact that one ambassador was cheaper than one battalion. We shall have to examine such sums much more critically.
Secondly, civilian manpower has not been adequately addressed. I specifically exclude those civilians who release soldiers to do the job for which those soldiers are trained.

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Why has the remaining civilian manpower been less rigorously examined than the armed services? Finally, why has the knotty legal problem of the deployment of reservists and, thus, the proper use of the reserve forces and the TA in the future not been thought through? We have not yet reached a sensible conclusion.
There are other, narrower points which I continue to find disturbing. I should like to use them today simply as an illustration of policies which I think have been inadequately thought through. There are two infantry points and two Royal Armoured Corps points.
First, on the infantry, the fact that our NATO allies have tolerated one or two battalions missing at any one time from I Division and from 3 Division not only prejudices the specialist roles of those forces being used in Northern Ireland, but puts at risk the leadership of the Allied Command Europe rapid reaction corps, which was so hard won and is likely to come under diplomatic challenge sooner rather than later.
Secondly—I declare an interest as a former member of the Household Division–1 am deeply disturbed that the Foot Guards have had to take a higher cut than the infantry as a whole. I say that in view of their ceremonial and fighting roles, which are unique, and also because of the standards that they set, which go through the whole of the rest of the Army. It smacks of the ghastly phenomenon of levelling down, and levelling down is the sort of philosophy which Conservative Members and many Opposition Members feel should be roundly rejected.
With regard to the Royal Armoured Corps, my first point concerns our armoured reconnaissance units. We have heard many wise words from hon. Members who have seen the situation in former Yugoslavia, and there are many others who believe that the armoured reconnaissance regiments are uniquely well equipped to fulfil the sort of role needed in Bosnia. I refer the House to a speech made in another place on 10 February by the noble Lord Vivian, who speaks with special authority, having recently retired as a brigadier. His speech is well worth reading by hon. Members.
My second point is the extraordinary fact that, in the ACE rapid reaction corps, the recce element is provided by a Territorial Army unit. However expert that TA unit is, I believe it to be a contradiction in terms that the recce element of a rapid reaction corps should be drawn from people who follow civilian occupations and are, I believe, drawn mainly from the north-east of England.
Mr. Michael Stephen: Will my hon. Friend accept that the recce element of the rapid reaction force could best be provided by reversing the enforced union of the two regiments of the Household Cavalry?
Dr. Goodson-Wickes: My hon. Friend and I share an interest in that very matter and I wholeheartedly endorse what he says. It is a matter that I drew to the House's attention in an Adjournment debate in November. I believe in the philosophy that, if one presents problems, one must come up with solutions. We have too few recce regiments and we have this ridiculous system of a union in the Household Cavalry whereby one service regiment will have to provide the same ceremonial duties as two service regiments have provided in the past. It is unsustainable. I have given the solution to my right hon. and learned Friend, and I very much hope that he accepts it soon.
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Finally, I should like to make a point which is slightly different but which has deep significance for all of us who have the welfare of our forces at heart. I am informed that this year's Sandhurst intake is down by about 150 people out of 800—and that at a time of very high unemployment. It is a sign of the trouble that we are storing up for the future. If we cannot attract the right men and women into our armed forces at a time of high unemployment, we will see the effect not now but at the time when those people are leading our Army in the future.
In conflict, as in politics, the unexpected always happens. Military planners in the past few decades could hardly have foreseen an 8,000-mile supply line to a conflict in an island dependency, or western involvement in a tank battle east of Suez—an emotive phrase—in the 1990s. I must caution the House that, because we scraped by—I I use the phrase advisedly—in those two conflicts, for reasons that we all know, we must not now be lulled into complacency that everything in future will turn out all right, that we can cut here and cut there but that it will all turn out right in the end. One day it will not.
I should like to offer another constructive thought to my right hon. and learned Friend. One certainly that we have amid the uncertainties is that in 1997 we shall quit Hong Kong. May I leave my right hon. and learned Friend with a suggestion which I believe to be sensible both militarily and politically and one which to me is mere common sense? Rather than adopting the view of the Select Committee, whose views I respect, I believe that there is a practical solution to the complex problems that lie before us. It would be sensible to slow down the implementation of "Options for Change" until 1997; in other words, to slow down the whole timetable. That would satisfy all the problems that I have posed to the House this evening, or at least a large part of them.
If my recommendations were taken up, it would then be sensible to take up the Opposition's suggestion of a full defence review, but I suggest that such a review should take place in 1997 so that our armed forces will then be properly equipped for the tasks which none of us can identify at the moment but which lie ahead of us into the next century.
8.26 pm
Mr. Tam Dalyell: There are other hon. Members who wish to speak and, even though they be on the opposite Benches, I think we should all restrain ourselves. My speech will therefore be truncated.
"As former government servants who assisted successive British governments with their aim of preventing the spread of nuclear weapons, we urge the Government to declare now an indefinite suspension of British testing. We are convinced that it would be in Britain's best interest to do so."
That was a letter in The Independent of 18 February. Who signed it? Sir John Thomson, Sir Michael Palliser, Sir Anthony Parsons and Sir John Edmonds, the ambassador to the comprehensive test ban treaty from 1978 to 1980. For reasons of time I will not pursue that letter, but it must be well known to the Ministry of Defence.
But hon. Members may care to listen to this:
"We believe this—"
that is, the call for a nuclear test ban—
"is one of the most pressing foreign policy issues facing Britain. As the Americans, French and Russians have now realised, they have to restrain their own nuclear programmes to have any chance of avoiding global nuclear proliferation. Without a test ban as part of a strong non-proliferation regime, what case do we have for persuading countries on the

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brink of developing nuclear weapons not to do so? …It is not too late for Britain to play again an influential disarmament role, in this and many other areas. But if disarmament does not set the agenda now, proliferation very shortly will. By banning nuclear testing, we can take an important step back from the proliferation abyss."
Who signed that? Those well known left-wingers, Lord Callaghan and Lord Healey. Having spent the past 30 years listening to them on defence, I really think that, when they say it, the Government ought to give a more serious answer, and a more serious answer also to General Sir Hugh Beach and to Frank Blackaby.
I read carefully Lord Zuckerman's article in Nature. Having had many ups and down with Solly Zuckerman for over 30 years, I know that, when he makes a plea like this, it is an extra reason for taking it seriously.
I want to ask two questions on it. In a report, Sidney Drell, John Foster, the director of the Lawrence Livermore Laboratory, one of the most distinguished in the United States, and Charles Townes, a Nobel prize winner in physics, gave it as their opinion that there is no need to test. When Russians and Americans think that there is no need to test, why do the British Government take a different view? At least there should be an explanation for that.
I quote from Zuckerman in Nature:
"In subsequent testimony before a panel of the House of Representatives Armed Services Committee (31 March 1992), Drell gave as his firm view that the additional and marginal gain in safety that could be derived from continued testing was less important than 'the political value, real or perceived, of a CTBT for strengthening or even preserving a non-proliferation regime'"
Do the British Government disagree with that? We are entitled to be told.
On the second issue, I should have liked the Secretary of State for Defence to be here, because it is personal to him. It concerns public interest immunity certificates. The Defence Secretary testified in a second certificate that, as far as his Department's paper mountain was concerned:
"I have read all these documents and am satisfied that they are of the nature described."
This relates to the documents in regard to the exports from Matrix Churchill and the Defence Secretary's locus in it.
The Defence Secretary, a Scottish QC himself, was content, like a policeman in court backing up the contents of a colleague's notebook, to agree with everything that the right hon. Member for Watford (Mr. Garel-Jones) had said. He said:
"I have formed the opinion that for the reasons described in the hon. Gentleman the Member for Watford's certificate, with which I agree and whose arguments I adopt, that production of such documents would be injurious to the public interest."
That is what the Defence Secretary went on record as saying.
In the House he later attempted to defend himself against accusations that he was among Ministers who had signed certificates to allow innocent men—that is, the directors of Matrix Churchill—to go to prison. He described the accusation as
"deeply offensive, deeply insulting and entirely without foundation."
I watched him as he said that. I was taken aback when he went on:
"There is no way that a Cabinet Minister who has no idea what the defence in a criminal trial might be can come to any
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judgment as to whether the papers before him are likely to be helpful or harmful to the defence or the prosecution."—[Official Report, 23 November 1992; Vol. 214, c. 706–07.]
That seems naive in any Minister of the Crown, but the Defence Secretary is not exactly any Minister of the Crown. He is a Queen's Counsel, he is an experienced lawyer, and he is used to reading documents. As a senior lawyer, he must have known that it was the defence team who were trying to prise the papers out of Whitehall, and Customs who were going about obtaining PII certificates to stop them. What did the Defence Secretary think that the defendants were on trial for?
It is difficult for another Minister who is not in the Cabinet to answer in the House tonight, but I should like a letter about it. As with so much else that I have said on the Floor of the House, I shall submit it for his consideration to Lord Justice Scott. Incidentally, I say again that it is scandalous that the Scott committee, contrary to the undertakings given to Parliament when the terms of reference were announced, is expected to cope with answers that should be given by Ministers.
Because other hon. Members wish to speak, I undertook to be brief. I could have continued much longer on the subject.
8.34 pm
Mr. George Kynoch: It is with pleasure that I take part in the debate. I shall try to cut short my comments, knowing that colleagues wish to speak.
Although I come from a business background, I speak with a family history of several generations in the Army, going back to the origin of the Gordon Highlanders. There I have a link with the hon. Member for Angus, East (Mr. Welsh). However, I was not impressed by his answer on the subject of Trident and Rosyth. I hope that he will explain to the people of Rosyth how getting rid of Trident will bring wealth and prosperity to the area.
Mr. Welsh: Will the hon. Gentleman explain to the people of the north-east why his Government are abolishing regiments? Can he explain why cuts in defence have been made by his political party?
Mr. Kynoch: If the hon. Gentleman will wait and listen to my comments, he will hear what I have to say on that.
In my constituency, support for the Gordon Highlanders is obviously strong, since it is the local regiment. Many of my constituents have given long service and have a long association with the regiment and feel strongly about its proposed amalgamation. It becomes even more difficult for them to accept the proposed merger with the Queen's Own Highlanders when they hear of the Gordon Highlanders being asked to top up the Prince of Wales Regiment in Bosnia in May because it is under strength, when that regiment is not to suffer merger or disbandment.
However, there is a clear understanding that the world has changed dramatically over the past few years. We lived for so many years in the shadow of the threat of the eastern bloc that we required to equip and man our armed forces accordingly. Thankfully, with all the deterrents which we and our allies have had, that threat was contained and never came to anything.
In 1987, when the Soviet Government, under Mikhail Gorbachev, initiated dramatic changes to the military posture of the Soviet Union and the Warsaw pact, it was

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inevitable that our military manning would need to be reassessed. Since then, further dramatic changes have occurred throughout the world, with the unification of Germany, and so on. The proposals in "Options for Change", while not universally popular, recognised the need for change in the light of the changing world, although the planned reduction in Army personnel from 156,000 to 116,000 was highly debatable.
It was also then that the debate intensified and the term "overstretch" became commonplace. I recognise from my past business life that cool, clear decision making is necessary, especially when ground rules change. However, it is important to retain flexibility whenever possible when difficult decisions have to be made. For the latter part of my business career, the concept of over-capacity in relation to demand, and thus overmanning, reluctantly played a prevalent part in much of my decision making, but in business, once the decision has been made and the machinery has been stripped out or the work force reduced, flexibility has changed immeasurably. One has to assume that one has made the best decision for the business.
In international affairs, the variables are much more unpredictable. I welcome very much the recent announcement by my right hon. and learned Friend the Secretary of State on Army manpower and the changes thereto. The decision to reverse the planned amalgamation of the Cheshire and Staffordshire Regiments, and that of the Royal Scots and the King's Own Scottish Borderers, was welcome. That decision graphically illustrated the ease with which a reversal of merger could be made at that juncture, but not when we are further down the road. I welcome the flexibility which my right hon. and learned Friend showed. I hope very much that he will use it again in future.
I think it was George Herbert who said:
"One sword keeps another in the sheath."
The responsibilities which international peacekeeping brings are indeed onerous and the Defence Select Committee report, in quoting my right hon. Friend the Foreign Secretary, sums up succinctly the choice which faces us:
"If boils keep on breaking out on the face of the world, our commitments could well increase—provided, that is, that we wish to maintain our position as a medium-sized power with a developed sense of international responsibility."
Hon. Members heard yesterday from my right hon. Friend the Foreign Secretary about the number of areas in the world where the United Nations is a peacekeeping force today. There are 13 operations with a fourteenth on the way. We are playing our part in this, and playing it well. We heard of the horrific scenes in the former Yugoslavia, a land which until a few years ago we knew as a holiday resort. Who would have thought, while sitting on the beach in Split in the 1980s, of the horrific scenes that would be prevalent there today and the humanitarian aid that is necessary to be provided for those poor people?
Of course we have to play our part in protecting the United Nations effort, and our armed forces are the best, the most courageous and the most efficient in the world.
The situation in the middle east is still not stable; the old eastern bloc countries are in a delicate state of stareteility and problems could erupt any day. At home, we still have a significant defence requirement in Northern Ireland.
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All in all, our military commitments are still great, although they may be significantly different from before, when the cold war existed. We must determine whether we can fulfil all our commitments, or indeed whether we want to. If we do, we must man accordingly.
There is clearly the argument, particularly within the Select Committee on Defence, about the level of overstretch within the Army. Even with the revised total of 119,000 men announced by my right hon. and learned Friend the Secretary of State, opinion continues to be expressed that the emergency tour interval may not be extended as far as the target 24 months.
I received a letter today from Major General Hopkinson, the Colonel of the Queen's Own Highlanders, which refers to the deferment of the amalgamation from the King's Own Scottish Borderers:
"This change of heart had been brought about by the inability of the infantry organised as proposed under Options for Change, to fulfil all the requirements expected of them. Even with the two battalion add back proposed the situation will be barely changed, and the reasons for this are clearly outlined in the Defence Committee's Report … The Scottish Division besides always providing battalions of the highest standards has proved that it is also able to maintain its battalions at the required strength."
He goes on to justify the Queen's Own Highlanders.
I welcome my right hon. and learned Friend's agreement to review manning levels in the light of changing circumstances, but I urge him to keep an ever watchful eye on the level of overstretch within the Army. It is with this concern in mind that I ask my right hon. and learned Friend to ensure that, before the time for each amalgamation, he reassesses the current level of overstretch at the emergency tour interval against his target level in aiming towards that 24-month period. I fully accept that, inevitably, it will be more difficult during amalgamation, but would stress that once an amalgamation has been effected it cannot be reversed. Each of the proud regiments to be amalgamated has a recruitment area and a family source to feed on. Once amalgamation has taken place, that will be all but lost.
It is clear that, on present projections, we can reduce numbers. It is clear that the main assumptions in "Options for Change" are still valid, but it is important to base decisions on facts and not emotions and I urge my right hon. and learned Friend to be absolutely 100 per cent. certain of his requirements before he finally merges regiments such as the Gordon Highlanders and the Queen's Own Highlanders. He has adjusted his figures once already and obviously, with the Gordon Highlanders in mind—
Mr. Welsh: Will the hon. Gentleman give way?
Mr. Kynoch: Other hon. Members want to speak and I am very close to completing my speech.
With the Gordon Highlanders in mind, I hope that my right hon. and learned Friend will reconfirm that he will do the same again if the requirements demand it.
8.44 pm
Mr. John Home Robertson: There is an almost complete consensus in the House about the policy that the Government should apply to the future of the Army. I say that there is almost complete consensus because, sadly, there is one small group of dissent and that tragically, is on the Treasury Bench. I hope against hope

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that Ministers are listening and that there will be further movement in the light of the debate and the unanimous report of the Select Committee on Defence.
I shall not detain the House for long because I was lucky enough to address it only yesterday on the subject of our peacekeeping role. We had the opportunity to discuss the growing need for peacekeeping operations under the auspices of the United Nations such as I and my colleagues on the Select Committee saw when we visited Bosnia just last week.
There is a desperate need for such operations in an increasingly unstable world, to protect suffering humanity, and no one is better at undertaking that task than the professional and highly equipped British forces, who prove it day in and day out in Bosnia and have done for many years in Northern Ireland.
It is downright irresponsible for any Government and indeed for the House to continue to overload our forces as is happening today. The House should join the Select Committee in insisting that the Government address the critical problem of overstretch in the Army. We should look at the evidence and analyse the task and the risk facing our armed forces. If necessary, in the light of other considerations, we should adjust the commitments that we are undertaking and, having done that, we should provide for sufficient forces to do the job. We should not do what the Government are doing now: burning the Army at both ends.
The Select Committee reached the unanimous conclusion that we need to add back another seven infantry battalions in addition to the two conceded by the Secretary of State for Defence on 3 February. I was delighted that one of the amalgamations that was cancelled on 3 February was that between my two local regiments, the King's Own Scottish Borderers and the Royal Scots. I hope to have the opportunity to celebrate with the Royal Scots in Northern Ireland before too long. I was happy and privileged to join the Cheshire Regiment in their celebrations in Bosnia last week. However, that concession is still not enough. I implore Ministers to look at the evidence.
Opposition Members, Conservative Members who voice the same opinion and all the members of the Select Committee on Defence are not suggesting that there should be an increase in expenditure on the Army. We are suggesting that there should be a 21 per cent. cut instead of a 26 per cent. cut in the size of the Army. We did that on the basis of the evidence that we have been able to glean. Clearly, it would be far better if there were a proper comprehensive defence review, but on the evidence that we have been able to obtain from the Department and elsewhere, there must be a further add-back of seven infantry battalions.
As a Scot I am very grateful for the reprieve of the Royal Scots and the King's Own Scottish Borderers and I am happy to join hon. Members for Angus, East (Mr. Welsh) and Kincardine and Deeside (Mr. Kynoch) in putting the case for the retention of the Gordon Highlanders and the Queen's Own Highlanders when those extra seven battalions are added back, as I believe they must be.
I sincerely congratulate my hon. Friend the Member for Motherwell, North (Dr. Reid) on his forensic analysis of
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the history of the Tory Government handling of the Army. He described the entire process of "Options for Change"; options they are not and cannot be as they are framed. He was kind to the Minister of State for the Armed Forces, who had the temerity to suggest there was some logic or continuity in the Government's policy for the Army. If he believes that, he does not know much about what is going on in his own Department, and there is evidence for that as well.
It was only on 12 January, reported in column 758 of Hansard, that the Minister of State said about the size of the Army:
"I do not think that we are talking about a review of the proposals for the amalgamation of regiments under 'Options for Change'. We still feel that we have the right number of regiments. We do not think that long-term commitments have changed sufficiently to want to change that."—[Official Report, 12 January 1993; Vol. 216, c. 758.]
Three short weeks later, the Secretary of State for Defence told the House:
"I have been considering for a number of months"—
not weeks, months—
"with my military advisers"—
but evidently not with the Minister of State—
"the need to adjust the force levels set out by my right hon. Friend." —[Official Report, 3 February 1993; Vol. 218, c. 319.]
Mr. Andrew Miller: Does my hon. Friend think that the Minister perhaps recognised the inconsistency between paragraphs 326 and 327 of the 1992 statement. Paragraph 326 says:
"During the process manpower shortages are likely to persist"
and then leaps on in paragraph 327 to say:
"manpower reductions will be achieved … by natural wastage."
Perhaps the House should be grateful for that.
Mr. Home Robertson: There are a number of manifest inconsistencies in the way in which the MOD has dealt with such matters. I hope that the unanimous view expressed in the House may lead the Ministry to think again. Either the Minister of State for the Armed Forces genuinely had not a clue about what was going on, or he was being as economical with the truth as he has been with the Army over the years.
In an eloquent intervention, the right hon. Member for Bridgwater (Mr. King) said that everything that had happened recently—including the add-back of the two battalions—was consistent with his plan. If that was the plan, it was a "cunning plan" worthy of Private Baldrick himself. We have had enough Baldricks in the MOD for the time being; it is time to use some common sense in these affairs. I welcome the fact that the present Secretary of State has begun to move, but he needs to move that little bit further. Those two cancelled amalgamations are not enough; we shall need to add back more and examine the Select Committee's evidence about overstretch.
According to any analysis, overstretch is already a feature of the circumstances in which our Army finds itself. We have heard about the emergency tour interval, nights out of bed, the need for training and, crucially—this was mentioned by my hon. Friend the Member for Stockton, North (Mr. Cook) and the hon. Member for Wimbledon (Dr. Goodson-Wickes)—our leading role in the NATO ACE rapid reaction corps. This is supposed to be a multinational standing force, trained, equipped and ready to react rapidly. How can it possibly do that if the leading

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element from the British Army is tied up on the streets of Northern Ireland, or undertaking other duties? It simply does not make sense.
That covers the general aspect, but I wish to raise two specific points. One may be trivial, but the other is very important. I tried to intervene on the Minister of State for the Armed Forces at the beginning of the debate, when he was talking about redundancies in the Army. The subject was raised with me by a number of non-commissioned officers in the Cheshire regiment when I met them last week in Vitez, in Bosnia. I met some people who had volunteered for redundancy. They said that, had they known that their regiment would not be amalgamated, they would not have volunteered for redundancy. They hoped to have an opportunity to withdraw their applications for voluntary redundancy because they wanted to continue to serve with their regiment—and I have no doubt that the same would apply to my people from the King's Own Scottish Borderers and the Royal Scots.
Mr. Archie Hamilton: In such circumstances, people can appeal against their redundancies, and their appeals will be considered.
Mr. Home Robertson: I am grateful to the Minister. I hope that appeals made in the circumstances that have described will he accepted and looked on favourably. I see that my hon. Friend the Member for Ellesmere Port and Neston (Mr. Miller) is in his place: he has a number of Cheshires in his constituency. No doubt he listened carefully to that intervention.
My other point is one that should have been made at the time of the Crimean war. It concerns problems with Army boots. I was disturbed to hear soldiers in Bosnia say that they had to buy their own boots, because standard-issue Army boots are not insulated against the cold, and leak. That should not be necessary. I suppose that, at the time of the Crimean war, left boots were sent out, and it was possible to have a waterproof left boot and an insulated right boot; but why cannot the Army get it right now? The point may sound trivial, but I think that it deserves an answer.
8.54 pm
Mr. Julian Brazier: I welcome the opportunity to speak. First, I shall make a few comments about the Regular Army; I shall then focus on the Territorial Army.
I greatly welcome the personal style that my right hon. and learned Friend the Secretary of State has brought to the Ministry of Defence; I know that it is much appreciated in the armed forces. Like other speakers, I believe that the armed forces—and, indeed., the Army—are severely overstretched. Although the welcome announcement made a fortnight ago will help, serious overstretch will remain. The proportion of gross domestic product allocated to defence has fallen from just over 5 per cent. in the mid 1980s to a projected 3.3 per cent. in two years' time. The level of commitments that we are trying to face has not fallen commensurately.
Unlike earlier speakers, I recognise that the Treasury has distinct problems with public spending, about which I have spoken in another debate. For that reason, I think that we must recognise where our priorities should lie. I believe that what differentiates the Conservative party
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from the Opposition parties is not concern about the armed forces, which is shared by hon. Members on both sides of the House, or a willingness to become involved in a range of different peacekeeping and other operations in different parts of the world—I believe that our forces are involved with the United Nations in 14 such operations. What differentiates the Conservative party from the others is its absolute commitment to maintaining firm defences for Britain and western Europe, both nuclear and conventional.
At a time when eastern Europe, the ex-Soviet states and the middle east are in turmoil, and when nuclear technology and possibly even nuclear weaponry are spreading into ever more irresponsible hands, we must be quite clear that, if we cannot find more money for our projected defence expenditure—in other words, reduce the level of planned reduction—we must cut the fringe commitments. We must look at our commitments, from Bosnia to Cambodiax2014;those 14 United Nations commitments and our military training missions, and others.
A single figure says it all. The percentage of the defence budget spent on equipment this year will be 37, the lowest level since we took office in 1979. This cannot be commensurate with smaller and better. We cannot, within the existing defence budget, have a higher level of projected manpower for that reason: the commitments must be reduced unless more money can be found.
There is a danger that, within the Army, people will begin to feel either increasingly cynical—the phrase "smaller and bitter" is going around—or, more likely, because I have the greatest admiration for our armed forces, will experience the more workmanlike and everyday but nevertheless equally dangerous feeling that we should get on with the immediate, short-term problems and forget about the longer term. That wearied feeling is more likely.
The danger there is that we shall do a superb job in Bosnia, that we shall do whatever is required by way of RAF supply runs in Somalia, that our 350 people in Cambodia will continue to do excellent work, but that our commitment to the rapid reaction corps, which is so central to the defence of western Europe, and our ability to fund projects that I regard as essential—Opposition Members may not agree—such as the tactical nuclear weapons system TASM, will be diminished or completely eroded.
Mr. McWilliam: Will the hon. Gentleman please explain his rationale, given that most of our commitment to the rapid reaction corps at any given time is on duty in Northern Ireland anyway? It cannot be in two places at once.
Mr. Brazier: The hon. Gentleman is right to some extent. There is such a level of Army overstretch at the moment that it is not possible for some units to train properly for the rapid reaction corps. If the hon. Gentleman had been listening to my speech, he would have heard me suggest that the solution is to reduce some of those commitments. The large number of commitments that we have to the United Nations are examples. I do not know how many hon. Members knew that we have 350 people in Cambodia until the fact appeared recently in a paper. Our central commitment must be to the defence of Britain and western Europe.

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On to the Territorial Army, I am sorry to have to deliver more bad news, but I believe that an opportunity was missed in 1991. I, for one, welcome the news from the Ministry of Defence that the Government are planning to look again at the future of the reserve forces. A proper survey should have been done in 1991, and should certainly be done now, to establish how to achieve better value from our reserve forces—in particular, the TA—drawing on lessons from abroad. Alas, two years ago, a team led by regular officers, the leading one of whom had never served in a TA unit, carried out a review. That review was based on theoretical criteria and was then negotiated in detail with the TAVRs, which are obviously very conscious of what is happening on their own patches. It is not good enough for such a review to be based on theoretical considerations rather than practical matters.
The Director General TA and Organisation, to whom I have just referred, in a submission to the Select Committee about the criteria on the basis of which TA units were selected for survival, spoke of
"their links with regular units, the territorial balance in a particular area, recruiting trends, the availability of TA centres, historical factors, regimental factors and local links."
At no point in any document that I have seen is the issue of the quality of the units concerned touched on. Amazingly, some of the weakest units in the Territorial Army—I could mention names, but it would be invidious to do so—were retained, although they were down to an effective 30 per cent. of their strength, whereas some of the best units were earmarked for disbandment simply because they did not fit the theoretical, geographical and other criteria that I have mentioned.
As a result, there has been a significant loss of morale in many parts of the TA. There has also been a loss of key personnel and an increase in turnover. We see the beginning of a vicious circle, with an unhealthy reaction between the regular command structure and the TA units concerned. The Regular Army's expectation of the TA has progressively dropped, and in some cases the TA is starting to fulfil the lower expectations. A number of very good units remain, but there are fewer of them.
It must be recognised that we shall never be able to fund everything we want in the Regular forces. The cost of a TA unit is between one fifth and one seventh of the cost of its regular counterpart. Reservists can make very high-quality units. Let me give two examples. In the last war, the most highly decorated company-size unit was a territorial unit; two years ago, the highest-scoring tank battalion in the Gulf was an American marine reservist unit.
We should have asked ourselves two years ago, and we should certainly be asking ourselves now, why large parts of the TA are not performing as well as they could. Why, for example, is TA turnover in Britain 30 per cent. and rising? In Australia, where the resource base for units is much lower—there are fewer permanent staff and an even lower man-training-day allocation—the turnover is 22 per cent. and falling.
I welcome the fresh approach that Ministers are bringing to this question, and I cannot stress sufficiently the fact that I welcome their intention to look again at the Territorial Army. However, I should like to make a point to them and, through them, to the Regular Army and the chiefs of staff. Eighteen months ago, Lord Bramall said
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that, with the disappearance of the national service generation over the next few years, the Regular Army will be in serious danger of cultural isolation and of finding that there are fewer and fewer people in the world who understand what defence is about and what armed forces are for. It would be very short-sighted and unwise for our extremely high quality but very small professional forces to believe that they can maintain their central position in the esteem and affection of the people of this country in an extended period of peace without the support of the reserve forces whose members go on to become prominent figures in civic life and business and a few of whom even become hack Members of Parliament like myself.
I shall be brief in order to allow other hon. Members to speak who have extended a similar courtesy to me. I shall make four points about what went wrong in the review last time and which my right hon. and learned Friend the Secretary of State should reconsider this time. The first is their mistaken willingness to consider moving good units. Fortunately, most of the moves have not yet taken place. For example, the 73rd Signal Regiment, which has a multi-million pound specially equipped drill hall, is due to be moved from Bexley to Bracknell. That will not only entail the loss of a new expensive facility but will mean losing most of the people because TA personnel cannot move far from their jobs and homes.
Secondly, I was astonished to learn that the document on the reserve forces, which was published a year ago, makes virtually no mention of the importance of leadership in the reserve forces, although that is the central drive of the excellent advertising programme of the National Employer Liaison Committee. We should ask why the TA standard officer training course at Mons lasts two weeks whereas the equivalent course in Australia last seven weeks.
The third point is the duplication in the command structure of the reserve forces between London and Wilton. It is strange that we have a tri-service arrangement in London to look after the reserve forces, which are 90 per cent. Army, and a duplicated single service arrangement to look after that 90 per cent. in Wilton.
That brings me to my fourth observation on the review, which may cause concern in the Ministry of Defence and the Regular Army. However, I believe that my right hon. and learned Friend has the freshness and openness of approach to re-examine the question. It is an extraordinary anomaly that Britain is the only country in the English-speaking world whose director of reserve forces is not a reservist. The last director of the reserves had never even served in a reserve unit. I do not blame him as an individual; it was not his fault.
We now have a great opportunity, and I am delighted that my right hon. and learned Friend is reconsidering the reserve forces. I suggest that a quick way, involving no cost, to give an immediate lift to morale in the reserve forces and to convince them that a new practical approach will be adopted is to recruit someone who has achieved a certain eminence in civilian life and has served a successful period in the reserve forces. Such a person should drive forward the change process and the new blueprint for the TA.
9.8 pm
Mr. Bruce Grocott: I do not intend to engage in the wider issues considered by so many hon. Members in the debate. I know that I must be brief, but I am grateful for the opportunity to raise two issues involving my constituency but with wider implications. I hope that they are also of general interest.
It is my privilege to represent the people who work at the Donington depot, which, for more than 50 years, has given outstanding service to the defence services, not only during the second world war but in more recent conflicts in the Falklands and the Gulf and now by supplying equipment to operations in the former Yugoslavia.
Relations between the civilians who work at Donington and the Ministry have always been extremely good. The service provided by the workers there has been outstanding and the depot has been an important source of employment, particularly for engineering apprentices at the 34 base workshops. The workshops have provided an excellent training ground for many years, and in the past morale there has been good.
The obsession of the Conservatives in recent years with contractorisation and privatisation, and the threat to jobs and the confidence of the people resulting from that trend, has been a persistent problem in the Donington depot. There have been all manner of threats, and even the security services there were at one time threatened with contractorisation.
I shall not tonight rehearse all the arguments against contractorisation, which are overwhelming and well known to the House. I urge the Government to acknowledge that constant meddling in affairs locally has a deeply depressing effect on the morale of the work force.
I have written to the Minister of State several times pointing out that if the Government persist with constant changes which involve threats to people's terms and conditions, it is incumbent on them to have the fullest consultation with the workers before changes take place.
A characteristic of the Donington depot has been the strength and skill of the union representation. Conservative Members often indulge in smears about union membership. At Donington, the Transport and General Workers Union and the engineering and white collar unions have always been extremely well represented and closely involved in decision making. They have worked closely with the management and have negotiated successfully on behalf of their members.
While I speak with pride on behalf of those unions, I urge the Government to accept that it is essential, when changes are proposed, that there is adequate consultation with all concerned. I am sure that members of the local management echo that view. We constantly have the feeling that decisions are made in London without reference to the people who live and work locally.
The only other issue I shall raise tonight, because of the shortage of time, may be regarded by the House as somewhat esoteric and might be thought to relate particularly to my constituency. Hon. Members will appreciate how one can, almost by accident, discover something in one's constituency, only later to appreciate that it has wider implications. A couple of years ago I heard from people working at the depot and others in my constituency about plans to close a two-mile rail link from the depot to the main line.
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I objected to the plan, for all sorts of reasons. It seemed common sense that we should encourage rail transport, being safer, more predictable, more environmentally friendly and because it relieved clutter on the motorways. I objected strongly, but without success. I followed that up with a series of parliamentary questions, for I wondered whether it was a narrow constituency point or was part of a pattern. I asked the Secretary of State for Defence
"what proportion of Ministry of Defence freight is being carried by (a) road and (b) rail".
I was given the sort of predictable answer that I expected:
"A detailed breakdown of the proportions moved by road and rail could not be provided without incurring disproportionate cost".—[Official Report, 15 October 1991; Vol. 196, c. 143.]
It is appropriate that the Secretary of State should be present tonight. No one can be better placed, as a former Secretary of State for Transport, to note what I am saying on this issue. After all, we listened with interest to his statements when he was Secretary of State for Transport, when he spoke about the importance of rail transport and the need to move traffic from road to rail. I recently asked the Secretary of State for Defence
"what plans he has to encourage the use of rail for freight by Ministry of Defence depots."
The reply was:
"My Department uses the most convenient and cost effective methods to transport freight and has no plans to favour the use of rail over any other method of transport." —[Official Report, 2 June 1992; Vol. 208, c. 527.]
It is amazing how Ministers shift Departments and fairly rapidly shift their values.
The most interesting of all the replies was that which I received when I tried to find out what had happened to Ministry of Defence use of the railways since the Government came to office. I asked a couple of simple questions, the first of which was how many diesel locomotives were maintained and operated by the MOD in 1979 and in 1991. The answer was that there were 176 in 1979 and 106 in 1991.
Perhaps the most important question that I asked was how many Ministry of Defence depots had rail links when the Government came to power, and how many had them now. The answer was that, when the Government came to power, 38 depots had rail links but that now only 21 have them. The arithmetic is fairly simple—the number has been almost halved. I also asked for a list of the depots that had lost their rail links, and there was a whole string of them all over the country, including:
"Regional Depot Aldershot; Ordnance Support Unit Ashford; OSU Burscough; Royal Air Force Carlisle; Central Ordnance Depot Donington"—
as I said, that is in my constituency—
"Royal Naval Stores Depot Eaglecliffe; RD Hereford; OSU Hessay; RAF Quedgeley; Procurement and Experimental Establishment Shoeburyness; RAF Stafford; RD Stirling; RD Thatcham; RD Thursk, RD Warcop; OSU Warminster".—[Official Report, 14 October 1991; Vol. 196, c. 63.]
When the Secretary of State for Defence was Secretary of State for Transport, he told us how important it was to use rail rather than road for freight carriage. The Ministry of Defence is the one area in which even this freewheeling, free-market Government have direct control over what means of transport are used to carry large amounts of freight—and the MOD's record is appalling. At the very least, it should maintain the track beds of the rail links that it has closed and encourage their reopening, especially the rail link at Donington in my constituency.
9.16 pm
Mr. Eric Martlew: This has been a strange debate. There have been more attacks on the Government from Conservative Members than from Opposition Members. Ministers must think that they have parachuted behind enemy lines. They have been subjected to a series of shots which can only be described as "friendly fire".
Parliament is telling the Ministers that they are wrong and should change their policies. Before I go into detail, I shall put on record the thanks of Labour Front-Bench spokesmen and, I am sure, of the whole House, to the Select Committee not only for its excellent report—although I am not sure whether Ministers will thank the Committee for it—but for the fact that the members of the Committee went to Bosnia. When one is elected a Member of Parliament, one expects that security will become a bit tighter, but to fly into a war zone requires some bravery.
If those hon. Members had not gone to Bosnia, the debate would not have been as informative. It is important that Members of Parliament continue to make such visits and report back to the House what is actually happening on the ground. I am sure that none of those hon. Members has been accused of having gone on a jaunt this time—and that not many of their constituents would have wished to go with them. The next time that they are accused of having holidays in work time, they should invite people to go to Bosnia with them.
I was most impressed by the excellent speech by my hon. Friend the Member for Motherwell, North (Dr. Reid). The way in which he dissected the Government's arguments will make the people who work and serve in the armed forces and who read his speech wish that he was in government and that Ministers were in opposition. It was an excellent speech. I am sure that it will be read in regiments throughout the land, and that people will say, "That is the way forward. If only we had elected a Labour Government."
There is no argument on the Opposition side about the nuclear test ban treaty. Hon. Members have said that we need to stop testing nuclear weapons. I predict that, within two years, the Government will stop testing and that, if they do not stop it, President Clinton will stop it for them. So let us stop testing nuclear weapons and keep our dignity.
The Chairman of the Select Committee, the hon. Member for Upminster (Sir N. Bonsor), made a withering attack on the Government. He did it in a nice way, but it was effective. It was even more effective because it came from the Conservative Benches.
Mr. Frank Cook: He is blushing.
Sir Nicholas Bonsor: It is just modesty.
Mr. Martlew: Modesty has rarely prevented me from saying anything, so I shall continue.
The right hon. Member for Bridgewater (Mr. King) told us that "Options for Change" was all a cunning plan. yes, I am sure that it was devised by that military man Captain Blackadder and his batman. We have seen that "Options for Change" was an option for anything. It was not a defence review but a quick fix, which is coming apart before our very eyes. That has been pointed out by other hon. Members.
My hon. Friend the Member for Denton and Reddish (Mr. Bennett) expounded Labour party policy on the
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nuclear test ban treaty, and he was dead right. He was also correct about the scandalous position with regard to defence lands. There is a need to provide access to the countryside, but we seem to be tying up more and more defence land instead of releasing it.
Mr. Brazier: Will the hon. Gentleman explain how he squares his party's line on the overstretch of manpower with saying that there should be less defence land for the armed forces? Presumably, if there are to be more armed forces, they need more land on which to train. They are already overstretched.
Mr. Martlew: That question is based on the premise that the armed forces do not have too much land now. Many of us would maintain that, ever since the end of the second world war, the armed forces have held on to too much land and should release even more.
The hon. Member for Blaby (Mr. Robathan), who is not in his place, made a courageous speech. I just hope that he is never called back to the colours, because if he is, he will not be promoted, at the very least.
My hon. Friend the Member for Stockton, North (Mr. Cook) made a major speech about Bosnia. He is not noted for agreeing with Conservative Members but he agreed with the hon. Member for Davyhulme (Mr. Churchill). That gives more credence to his views. We are united in saying that "Options for Change" is wrong. The only people who say different are on the Government Front Bench.
My hon. Friend the Member for East Lothian (Mr. Home Robertson) made an important point about redundancies. Although the Minister intervened, I was not happy with his explanation. People from the Cheshire Regiment volunteered for redundancy because their regiment was to be amalgamated. Then fortunately, as everyone would agree, the correct decision was made not to amalgamate the regiment. The people who volunteered for redundancy have been told that they can appeal against redundancy. They should be able to withdraw their applications for redundancy, because they applied on the premise that the regiment would disappear.
It turned out, as a result of the Government's incompetence, to be a false premise. I hope that in his reply the Minister will change his view and say that any member of any regiment that has been saved who applied for redundancy will have the opportunity to withdraw the application. That would be only fair. I suspect that the answer will be negative. Perhaps the Minister will surprise me.
Mr. Archie Hamilton: I am uncertain about what is unfair about appealing, and having that appeal considered sympathetically.
Mr. Martlew: I shall tease the Minister a little more to get something more out of him. Is he giving us a commitment that any member of the armed forces who, having applied for redundancy in the regiments that have now been saved, appeals against that redundancy will have that appeal granted?
Mr. Hamilton: I am saying that such people will be able to appeal against redundancy on the ground that the basis on which they applied for redundancy was that their regiment was going to be amalgamated. One cannot say that anything is automatic. The appeal will be considered on the grounds on which it is made.
Mr. Martlew: Again, I suspect that there are one or two weasel words there. We shall take the Minister as an honourable man, and we shall monitor the position. We shall come back to the House if we find that people are having their appeals turned down. I am sure that the matter will be viewed with great interest by the regiments concerned.
I am grateful to my hon. Friend the Member for The Wrekin (Mr. Grocott), first for mentioning my constituency, which is always a good thing, and secondly for bringing to the attention of the House a different aspect. The civilian side of the Ministry of Defence and of the Army is important, as is the morale of those people. I know of the efforts that they put in, especially during crises. I also know of the hard work of the trade unions at the depots.
We have heard a lot today about what is wrong with the Army. We accept that people who sign up for our armed forces, especially for the Army, are different in many ways from people who join armies in other countries of the Alliance. For the past 25 years, the soldiers of the United Kingdom have unfortunately had to go on active service in Northern Ireland. They may join up because of unemployment or because of a sense of adventure, but they do not join up because it is an easy option. We accept that they are brave people to join up, so we believe that they deserve respect and support, which they get from Opposition Members.
Although we must accept that there has been an end to the cold war, which must mean radical changes, there is a feeling that there is a lack of leadership at the very top. I am not talking about the generals, but about Ministers. What the Government have done has turned the Army into a bad employer. It is getting very much like the cowboy security firms, which give people a fancy uniform but then do not take care of their basic needs.
The Government are cutting soldiers' pay this year—a point to which I shall return. They are introducing compulsory redundancies and evicting former soldiers from their homes. They have failed to make adequate provision for rehousing former soldiers. They have decreased the length of time between dangerous tours of duty. They have failed over overseas allowances. They have failed to define the role of women in the Army. Above all, they have failed to generate a belief that those in charge know what they are doing. I repeat that I am talking not about the generarls, but about the Minister of State, about the Secretary of State and about the Prime Minister.
Mr. Colvin: The hon. Gentleman believes—and I agree —that we have problems. Surely there are even greater problems in NATO as a whole. The role of our Army rnust be looked at in terms of its job within NATO. It has been mentioned that other member states in NATO are cutting their defence forces even more than we are. In the "Statement on the Defence Estimates 1992", my right hon. and learned Friend showed in table 4 that the cuts in the armed forces across NATO were on average 23 per cent. between 1990 and 1995. In the British Army, cuts amounted to only 20 per cent. We have now persuaded our Secretary of State to restore some of the proposed cuts. Is it not even more important to persuade our NATO allies to take another look at their proposed cuts too?
Mr. Martlew: That would appear to be a failure on the part of the Ministry of Defence and of the Foreign
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Secretary. The fact is that we must put our own house in order. We are talking about a decline in the quality of life of the British soldiers—I think that the hon. Gentleman will accept that that is the problem.
We need to raise morale by giving the Army a commitment. I fear that the Government give commitments only to the Treasury. Such improvements as they have made in the system have been done in a mean-minded way. For instance, the reduction in the secrecy surrounding boards of inquiry, and soldiers' ability to claim compensation from the Ministry of Defence have been effected in a mealy-mouthed manner, and if I have time, I will give examples.
I realise that I have made a long list of charges, and that they will need to be substantiated. I am sure that I will be accused of being a barrack-room lawyer—not a title that I would reject if it means that I am seen as a supporter of justice and fair play for our service personnel.
In a reply to me from the Dispatch Box, the Secretary of State said that service men would accept an increase in pay of 1.5 per cent. Does he realise that that is a greater cut than all other Government employees face? I arrive at that conclusion on the basis of the retail prices index. Headline inflation is running at 1.7 per cent., and seen against that, a 1.5 per cent. increase does not seem too bad. It is only 1.7 per cent., however, because of a big drop in mortgage rates. The underlying rate of inflation is 3.4 per cent., and soldiers, of course, tend not to have mortgages. So the Government are in effect reducing the pay of our soldiers by almost 2 per cent. this year.
The Secretary of State did nothing to stop this. He must have been aware of the retail prices index. Tories have praised the bravery of our soldiers, but they have cut their pay.
Mr. Ian Bruce: The hon. Gentleman has been misrepresenting what I was going to say. I firmly believe that the Treasury was right to ask for cuts in the Ministry of Defence budget. It is extraordinary of the hon. Gentleman to suggest that the budget should not have been cut in any way. Where would the Labour party have made the cuts that it promised at the election?
Mr. Martlew: I am delighted to tell the hon. Gentleman that the Labour party would not have cut the wages of British soldiers.
We have already discussed compulsory redundancy notices for 628 officers. That was not a new announcement; in fact, it emerged in a written reply quite some time ago, on 10 December. So despite deciding to save two battalions the Government have not been prepared to reconsider these redundancies. They simply took the decision that the officers were to go, and that was it. They are so arrogant that they take away people's jobs and careers, without giving the matter a second thought.
There has also been confusion over housing. This year, a record 22 members of the armed forces were evicted. No provision has been made for returning soldiers and local authorities are in deep trouble with housing. I appreciate that the Government have introduced a new scheme to help soldiers and other service personnel to buy their houses, but they did so ten years too late, and it is no good to those people who will be told tomorrow that they are to be made redundant: it will not help them one bit.
The Government even seem to be cheating our troops over overseas allowances. If they work for the United

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Nations in Cambodia, they get a subsistence allowance of $145 a day—from the United Nations—but if they work for the United Nations, through the British Government, in Bosnia, they get next to nothing.
Finally, the Government's failure to follow the Labour party's advice and to have a total defence review, and the "Options for Change" proposals have made the Government a laughing stock within the Army, especially their proposal to decrease the number of infantry battalions from 55 to 38. That proposal has been exposed as unrealistic, and was based on flawed facts. That is why the Secretary of State had to make a statement to the House on 3 February to reinstate two of those battalions, but that is not enough.
The Tory-dominated Defence Select Committee has said that there should not be any amalgamations or disbandments. It has also been said that the stress and strain of overstretch is a serious threat to life and family life, because of the grossly reduced intervals between tours of duty, and that cannot continue. If the Secretary of State is to remain credible, we need an immediate defence review.
This is not the first time that we have had such a debate —it has happened many times. There was a similar debate in 1794, when William Pitt was Prime Minister. The Commander-in-Chief of the Army was having major problems in Flanders. The event is remembered to this day in the jingle "The Grand Old Duke of York". Hon. Members know the rhyme:
"The grand old Duke of York,
He had 10,000 men,
He marched them up to the top of the hill,
And he marched them down again."
Does that not remind hon. Members of someone? The Secretary of State had 55 battalions, he decided to take them down to 38 battalions and now he has said that he will take them back up to 40 battalions, while the Select Committee says that he should not have touched them at all. The British Army does not know whether it is coming or going.
The grand old Duke of York resigned on that occasion, although he was reinstated because his brother was King George III. Perhaps the Secretary of State should do the same tonight.
9.38 pm
The Minister of State for Defence Procurement (Mr. Jonathan Aitken): We should remember that his brother used to say to the grand old Duke of York, "They will never kill me, James, to make you King." We certainly would not replace my excellent right hon. and learned Friend the Secretary of State with the shower of Opposition Members who have spoken tonight.
One admirable aspect of the debate has been the steady flow of tributes which have rightly been paid to the skill and dedication of our armed forces and to the Army in particular. I thank the two Opposition spokesman—the hon. and learned Member for Fife, North-East (Mr. Campbell) and the hon. Member for Motherwell, North (Dr. Reid)—who paid particularly warm tributes early in their speeches.
As my right hon. Friend the Minister of State for the Armed Forces made clear in his opening speech, the Government share that high admiration for the Army. The Army is a beacon of professional excellence that always
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shines brightly—it is perhaps shining particularly brightly now when we seem to be living through a not unfamiliar period of doom and gloom in our national life and every institution is under attack. The Army, happily, is immune from such attacks, perhaps because it enshrines some of the old-fashioned values of loyalty, duty, discipline and patriotism, as well as its conventional professionalism and skill. I am sure that the Army will be gratified by the unity of the tributes paid to it in the House during today's debate.
This is the first service debate in which I have spoken from the Dispatch Box. I had always heard that they were quiet, amicable occasions, but today's debate has not turned out quite that way. I do not exactly feel—as the hon. Member for Carlisle (Mr. Martlew) said—as though I have been parachuted behind enemy lines, but the words of the poet Tennyson came to mind—
"Cannon to right of them
Cannon to left of them,
Cannon in front of them
Volley'd and thunder'd."
I hope to persuade some of the Opposition Members and some of my hon. Friends whose speeches were critical to reason a little more deeply. If they did so, they might see some of the issues in a fairer perspective.
I shall attempt to address as many issues as have been raised in the debate as possible. However, I shall not respond to those points that ranged wide of the Army subject.
I turn to the extraordinary speech of the hon. Member for Motherwell, North with some relish. The only point on which I agreed with him was his tribute to the Army. After that, with the air of a funny-money salesman about to perform the three-card trick, he took us into a world of pure statistical mumbo-jumbo and sought to persuade us that the Labour party has a consistent defence policy by projecting the trends of the Callaghan Government defence budget in 1977 to show that the Labour party was sound on defence spending today.
The argument was not convincing when one remembered that the Labour conference in 1992 proclaimed that it would require defence cuts equivalent to £6 billion. Then, to cover up the embarrassment with a convenient conjuror's handkerchief, the Labour party produced that all-singing, all-dancing formula—the defence review. Hiding behind that device, Labour Members call for increases in defence manpower and resources in speeches in the House, then go to their conference in Blackpool or Brighton, where there are simultaneous calls for huge reductions in defence spending. That formula does not fool anyone.
When he finished his funny-money routine, the hon. Member for Motherwell, North showed a flash of anger on the subject of redundancies. However, he got his party's policy stance absolutely wrong. His anger was directed at the regrettable fact that some redundancies that are to take place in the Army will fall on those who are today serving on active duty in Bosnia and Northern Ireland. The hon. and learned Member for Fife, North-East made the same point, but in noticeably more cautious and measured tones.
All redundancies in the Army are much regretted. We are losing first-class people, which is painful and sad for the Army and for Britain. However, it is the Army's opinion—and not just that of the brass hats—that it would be wrong and unfair to make a special exception to the

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redundancy programme on the grounds that a service man happens to be serving in a specific operational or geographical theatre at any one time. That view is shared by all sensible people who think deeply about the Arny's welfare and, of course, by Ministers.
I think it was my right hon. Friend the Member for Bridgwater (Mr. King) who said that a wounded man could be brought out of theatre and be exempt from redundancy in one place, but liable for redundancy in another. It would be nonsense to grant exemptions on the basis of special theatres. That would be unfair to the Army as a whole. I am sure that our policy is right—and the Army certainly thinks so.
With his great experience as a former Secretary of State for Defence and Secretary of State for Northern Ireland, my right hon. Friend the Member for Bridgwater spoke with great authority. I was grateful to him for nailing the absurd misrepresentation that "Options for Change" was planned on a financial-only basis, without strategic considerations. As my right hon. Friend rightly said, if that were true—it certainly is not—it would be an insult, not just to him, but to the Chief of the Defence Staff and the other military advisers.
Since "Options for Change" we have added commitments in Bosnia. It was envisaged in the original statement that there might have to be extra military resources—[HON. MEMBERS: "It was planned."] No, it was not the plan. But there was certainly a plan for possibilities—that was always said and always recorded. [Interruption.] No one is being smug. I do not know why there is so much joviality among Opposition Members when the Government do what is sensible and right in accordance with changing commitments, because commitments have changed and increased and my right hon. and learned Friend the Secretary of State deserves great credit for thinking about the matter for a long time. I know that he was thinking for many months before he made the announcement on 3 February which was widely welcomed in the House and the country.
The hon. and learned Member for Fife, North-East made a serious allegation, which was repeated by the hon. Member for Stockton, North (Mr. Cook), about the rules of engagement in Bosnia. I was surprised by their allegation that those rules somehow resulted in weapons having to be handed in, according to statements made to those two hon. Members when they were on their travels.
There are no United Kingdom or United Nations rules of engagement which require members of United Kingdom forces in the former Yugoslavia to hand over their personal weapons under any circumstances, nor is there any local clarification note to that effect. Of course we shall look into the reports by the two hon. Members but they are out of tune with everything that we know.
Mr. Menzies Campbell: Perhaps the Minister is about to offer some reassurance to me and to the hon. Member for Stockton, North (Mr. Cook). I suppose that we both stand as credible witnesses and I assure the Minister that when the matter was put to a senior British officer the answer was that which we have reported to the House. If by doing that we bring about a change in circumstances in Croatia, we shall have done our duty by the House and by our forces.
Mr. Aitken: Of course, I accept that the two hon. Members have correctly reported what they were told. We shall get it clarified down the chain of command.
Two hon. Members raised constituency matters. One was my hon. Friend the Member for Richmond, Yorks (Mr. Hague), who rightly takes great pride in Catterick. Like him, I am glad that it is expanding and that infantry recruitment training is to go there. I was glad to hear his welcome for market testing. I assure him that there will be a level playing field and open and fair competitions. I hope and expect that many in-house bids will succeed.
The other Member to raise a constituency point was the hon. Member for The Wrekin (Mr. Grocott). The Donnington depot to which he referred is being market-tested and I accept that there will need to be the fullest consultation with the work force. The market testing programme is on a level and fair playing field and if it does result, as market testing programmes usually do., in savings of about 20 per cent., they will go to the sharp end of the defence budget. All those who care about our defences will welcome that programme.
Mr. Ian Bruce: Will my hon. Friend give way briefly?
Mr. Aitken: I should prefer to make progress.
The hon. Member for Denton and Reddish (Mr. Bennett) wanted a review of defence lands. We need our present training areas. The defence estate consists of 600,000 acres and 80 per cent. of it is needed for training. As we reduce our training areas in Germany, we need our domestic training areas and we must keep them.
My hon. Friend the Member for Upminster (Sir N. Bonsor), who is the Chairman of the Select Committee on Defence, made an important speech. I thank him for his leadership on the Select Committee and for its important work. He spoke about the equipment budget and, as the Minister responsible for that budget, I am pleased to have something to say about it, although I cannot make announcements now on the equipment issues that he raised.
The equipment programme for the Army remains strong and healthy, with AS90, Warriors, and tenders having gone out for the attack helicopters. For those who take a great interest in Royal Ordnance plc, I am pleased to announce that, in line with the strategy for ammunition procurement announced on 20 January, a five-year contract for the supply of L106 fuses has today been awarded to Royal Ordnance plc. It is a vital order, which is worth up to £15 million to the factories in Blackburn.
Mr. Greg Pope: As the Minister is aware, that contract has been long fought for, not just by me but by my hon. Friends the Members for Blackburn (Mr. Straw) and for Rossendale and Darwen (Ms. Anderson). The award of the contract is extremely good news, not just for defence procurement but for the economy of east Lancashire, where the Royal Ordnance factory has long been a skills base which has spread into the wider economy. I hope that the Minister will accept my thanks and congratulations and those of my hon. Friends the Members for Blackburn and for Rossendale and Darwen.
Mr. Aitken: I am grateful to the hon. Gentleman for his kind remarks.
My hon. Friend the Member for Upminster raised the great issue of overstretch. The kernel of the charge that he and many other hon. Members made against the

975
Government was that the present arrangements are such that the Army is unable to meet the 24-month interval between emergency tours. We know and accept that that is a difficult problem. We have always acknowledged that the process of restructuring would inevitably lead to additional pressures and demands on service personnel and we are sensitive to the impact of those additional demands. That is why my right hon. and learned Friend made his important announcement on 3 February.
I can say that the add-back of the two battalions announced by my right hon. and learned Friend will have the immediate effect of increasing the average interval between emergency tours during the difficult period of transition to the new force structure and, on the basis of our current commitments, this should comfortably exceed the target of 24 months once restructuring is complete. We now have the 15-month figure for the current year, and that will increase to 17 months. By 1995 the figure will be more than 24 months, so we are moving in the right direction.
The hon. Member for Fermanagh and South Tyrone (Mr. Maginnis) rightly paid tribute to the work of the Royal Irish Regiment in Bosnia, and I agree with him. He raised many detailed points about the situation in Northern Ireland, particularly relating to the TAORs, and my right hon. Friend the Minister of State will write to him about the detailed points that he has raised.
I now turn to the important speech made by my hon. Friend the Member for Blaby (Mr. Robathan), who argued that a reappraisal of the command structure was needed and that we had too many chiefs and not enough Indians. He made some telling points. I certainly have some sympathy for his view that there is too much paperwork in the Ministry of Defence. I can tell him that senior service appointment numbers will fall as a consequence of "Options for Change", but senior Ministry of Defence posts are under particular scrutiny as part of the rationalisation of headquarters. I agree that he made some telling points which we will consider carefully.
I was glad that the hon. Member for Angus, East (Mr. Welsh), who spoke for the Scottish National party, came out in such strong terms for greater spending on defence and much greater expansion of our armed forces. I am glad to know that it is SNP policy, as it is apparently to strangle the workers of Rosyth by withdrawing the Trident submarines immediately.
Mr. Welsh: Strangling the workers of Rosyth is something that the Government do rather too well, and I wish that they would not. Will the Minister now answer the question about overstretch? He rather skated over it. If there were extra commitments in Bosnia following a peace plan, could the Government meet such commitments?
Mr. Aitken: I have just answered the central point made by my hon. Friend the Member for Upminster on overstretch generally. It is true that if the Vance-Owen plan was implemented and Britain made a major contribution in troop numbers, it would cause a re-evaluation of the numbers in "Options for Change"; but that is a hypothetical situation at present.
I dealt with the point of the hon. Member for Stockton, North about the rules of engagement. He thought that the most important question was what exactly prompted the
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statement on 3 February, as though this was the most fundamental question of our time. There is no great mystery about it. I think that it was Sir Winston Churchill who said, when answering a similar charge of inconsistency from the Opposition Benches:
"My thoughts are a harmonious process in tune with the music of current events."
My right hon. Friend responded simply and wisely and was sensitive to pressures that are building up in this area.
Turning briefly to the point made by the hon. Member for Linlithgow (Mr. Dalyell) on the subject of nuclear testing, there is no question of our carrying out nuclear tests while the United States moratorium lasts, but we continue to believe that testing remains the best means of ensuring the safety and credibility of our deterrent. We are keen to develop alternative warhead-proving techniques, but we do not regard these as adequate substitutes for testing in the present state of technology. The Russians, French and Americans must speak for themselves, but I remind the hon. Member that United States legislation does not propose an immediate end to nuclear testing.
Mr. Dalyellrose—
Mr. Aitken: I would rather not give way.
Mr. Dalyell: May I congratulate the Minister on actually answering the debate? Would he be indiscreet enough to say what he thinks about a Queen's Counsel and the questions on the public interest immunity certificate that I raised with him?
Mr. Aitken: I will be indiscreet enough to say that I thought that the hon. Gentleman's allegations were totally unfounded and unfair.
I was grateful that at least one voice on the Government Benches, that of my hon. Friend the Member for Kincardine and Deeside (Mr. Kynoch), accepted that we could reduce numbers in the new strategic environment. An unreal and unwordly air ran throughout the debate. So many hon. Members, from all sides of the House, demanded extra spending, extra resources and extra commitments. My hon. Friends the Members for Wimbledon (Dr. Goodson-Wickes), for Upminster and for Davyhulme (Mr. Churchill) and the hon. Members for Angus, East and for Stockton, North were all on the theme that we should increase substantially defence spending in financial or resources terms.
Defence spending is not an island isolated from the rest of the economy or Britain's economic needs. Nor is defence strategy isolated from a favourable change in the strategic environment, if it takes place. I should remind the House that we are withdrawing some 27,000 Army personnel from Germany, including 3 Battalion garrison at Berlin. In addition, we will lose 4 Battalion garrison from Hong Kong by 1997. Those reductions in commitment far outweigh the commitments that have been taken on. Sensible points have been made about how we should manage the changes. I took the point of my hon. Friend the Member for Canterbury (Mr. Brazier) about the need to look again at our reserve forces. We are doing just that.
Parts of the debate seemed unrealistic. I want to end with an illustrative anecdote which I think it is worth telling the House. I feel that it is necessary to bring us back to the realities of spending commitments and strategy. Last week I was travelling in east Germany, a country which until 1990 was bristling and bulging with the menace

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of 500,000 Warsaw pact troops, all hostile to the west. I was being taken on a tour of military installations by my host and friend, the State Secretary of Defence for the Federal Republic of Germany.
One highlight of the tour was a visit to a vast encampment of military equipment at Grimma. The encampment was about the size of Hyde park and it was jam-packed with tanks, armoured cars, field guns, missile launchers and attack weapons of every description, all abandoned by the east German army and destined never to fire again, waiting only for destruction by scrap merchants.
Then I was taken to the huge Soviet barracks near Leipzig, which less than a year ago was packed with thousands and thousands of red army troops. Today those barracks are totally empty and deserted. It was a surreal, almost spooky experience to wander among those cavernous blocks and buildings in a ghost:own atmosphere, to see weeds growing on the parade ground, to see cobwebs in the machine rooms where once nuclear warheads had been fitted to missiles, and to look at the broken plinth where the statute of Lenin once stood, which the troops had to salute.
In that atmosphere of complete emptiness suddenly I felt overcome by a quiet feeling of enormous pride at the realisation of what our defence policy and our commitment to NATO had achieved. Those abandoned Soviet barracks symbolised vividly and visually that the cold war was over, that we had actually won it, that our old enemies had gone home and that we are starting to make friends with them again. That happened only because the NATO alliance, and particularly the British Army of the Rhine, had held the line for many years, and had kept the peace so professionally and so patiently for
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long enough for western democratic ideals of freedom to take root and for the Communist ideology to crumble and fall.
When we consider the Army of the future, we must not forget the lessons of the recent past. The massive job of peacekeeping which the British Army did so well with our allies in Europe in the last part of the 20th century may need to be repeated, but surely in much smaller scenarios. Other tyrannies and dictatorships may arise on the European land mass in the 21st century. At home Northern Ireland remains a steadfast commitment, because there, too, the Army holds the line professionally and patiently against the IRA terrorists, whose ideology of evil and hatred will surely one day become as discredited and will crumble and fall, just as Communism fell.
Of course, there may be other aggressors elsewhere in the world; there may be other Saddam Husseins who will need to be checked by coalition forces in which the British Army will play a vital role. We all recognise that those commitments will exist, but I cannot accept the arguments that were made so easily for massively increasing resources and spending when there is no truly identifiable or immediate threat. There is plenty more work for the Army to do in the closing years of this century and early years of the next.
The debate has revealed some understandable anxieties, but it also shows that the British Parliament and the British people are proud of our Army and that they will support it and require it to continue its superbly professional role in safeguarding Britain's future for many years ahead.
It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.

Chinese and Taiwanese Bicycles
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Arbuthnot.]
10 pm
Mr. Anthony Steen: As it is close to bedtime, I shall tell the House a bedtime story. Although it is a bedtime story, it is a nasty story about cheating, dirty tricks and commercial chicanery. It has a devious plot. The one ray of light is the guardian angel, personified by the Minister for Trade who is on the Front Bench tonight. It is a delight to cast the Minister in the role of guardian angel, which I know he will prove when he replies to the debate. If everyone is sitting comfortably, I shall begin.
Let us set the scene. Worldwide, 100 million bicycles are made every year and 40 million of them are built in China in some of the most modern plants ever to be constructed. They look like something one would expect to see in a James Bond film—meticulously clean with thousands of Chinese rushing around in the Chenzhen free trade zone near the China sea.
How can the Chinese afford to build such modern and wonderful factories of which Britain would be envious? They can do it thanks to the World bank, to which Britain made a contribution of £110 million in 1988 and more subsequently. The World bank generously offered soft loans to China for its emerging industry, as it is called. However, not much is emerging from an industry that has 40 per cent. of the world market.
The clever Chinese are producing bikes in ultra high-tech plants solely because of the World bank's money to which Europe and the United States have contributed. One could say, "Good for the Chinese," but the impact on Europe has been devastating. It has been like asking a unicyclist to compete in the tour de France.
We should not get it wrong; the Europeans are no fools either. They are still in the story by virtue of the fact they have put a ceiling on EC bike imports which is expressed as 9.5 million ecu from what are called generalised system of preferences—GSP—countries. As China is a GSP country, the bikes can come in free without any tax whatsoever. Above that figure of 9.5 million ecu they have to pay, in theory, 17.1 per cent. tax per bicycle. As the plot unfolds, we shall see that they do not pay a penny in tax; they have managed to find a way round it.
Under GSP there are a number of countries that enjoy special preference which allows them to import into the EC free of tax. When China realises that it has reached the ecu ceiling on imports, it does not stop manufacturing bikes; on the contrary, it surreptitiously arranges, through subsidiary companies and agents, for its bikes to be sent to other GSP countries such as Thailand, Indonesia, Malaysia or Hong Kong. As all those countries enjoy special GSP status, each can import to the EC—free of tax –9.5 million ecu worth of bikes, thus avoiding the 17.1 per cent. tax that would have been added if they had not switched through the other GSP countries.
Taiwan, unfortunately, is the odd man out: it has no GSP status. It therefore relocates its bicycle manufacturing industry in GSP countries. Even Taiwan has Chinese factories, with thousands of Taiwanese rushing around in ultra-modern plants making bicycles. That is swelling the number of bicycles in China, which means that more and more bicycles made in China are not moved from China to
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Europe, but go to some of the other GSP countries that have not used their quota of the EC allocation and then go to Europe.
The Chinese employ other, rather shady devices. They send their bikes out of China to Hong Kong in unmarked crates with false destination labels. In Hong Kong, the bikes are repacked and sent to the United Kingdom in different containers, unassembled, in what is known in the trade as a knock-down condition, which attracts only 8 per cent. tax on accessories. That is the process of last resort, when all the other tricks have been exhausted.
Let us take a look at Thailand, Malaysia and Indonesia —all GSP countries. Bicycle exports have gone through the roof: they have grown sixfold in the past two years, not because any of those three countries are building more bikes—the Chinese and Taiwanese are building more bikes in China, and sending them to Thailand, Malaysia and Indonesia for shipment into Europe. It is a very shady story, and I know that my hon. Friend the Minister will be greatly troubled by it.
Some of those listening to this story will say, "So what? So Chinese bikes are being dumped in Britain." It matters a great deal, because Britain's bicycle industry is being squeezed into extinction. Britain used to have one of the largest bicycle industries in the world, and we were very proud of that industry; today, thanks to the Chinese and the Taiwanese, we have only 1·2 million bicycles out of a world production of 100 million bicycles a year.
Mr. Andrew Robathan: Perhaps a parallel could be drawn with the method by which the Japanese have undermined our motor cycle market in past decades. They ruined that market, only to up their prices as soon as it collapsed.
Will my hon. Friend comment on the fact that, although Nottingham is the home of the Raleigh bicycle, not many Nottingham Members seem to be present to listen to his sensible comments?
Mr. Steen: I cannot see any hon. Members on the Opposition Benches. Perhaps I am suffering from restricted vision after writing one of the best speeches that I have ever written, but my hon. Friend's point is very telling. When a scare story was put out that the British motor cycle industry was going to collapse, everyone said that it was not true; then the industry collapsed. Now the same is happening with the British bicycle industry.
It is not that Raleigh and other leading manufacturers have not modernised their plant; on the contrary, they use robots, lasers and other innovatory products. Raleigh and Dawes, two of the leading manufacturers, are aggressive and dynamic. But how can these industries in Britain compete with the sweatshop labour in a totalitarian country that pays pence, rather than pounds, an hour, where management will stop at nothing to see that their bicycles are landed on our shores?
Where is the cavalry? Who will rescue our industry? The Canadian Mounties found that cheap imports were being dumped on their doorstep. Within five months those goods had been banned, blocked and stopped at the port of entry. Why has not the cavalry responed like the Canadian Mounties to protect Europe from this influx of bicycles? The single market and the free trade will not be much good if they are unable to,prevent illegal products from flooding in.

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The people in Brussels, I am told, are not too concerned about the dumping of bicycles in Britain, so long as they have their steak and chips and chocolates. We have to rely on the votes of member states to ensure that the dumping will stop. While our industry is bleeding to death, while our people are being put on the unemployment heap, the Eurocrats continue to make merry with a glass of Burgundy. While Brussels continues to party, Raleigh has already laid off 500 staff in the past few months because of Chinese dumping.
We are witnessing a commercially corrupt process aided by the World bank and making any competition virtually impossible. The Treasury is using taxpayers' money to put our own people out of business.
But the story does not end there. We have the Taiwanese also to deal with. My hon. Friend should watch out for the Taiwanese bicycle company whose fax came into the possession of a British bicycle company. The Taiwanese have a wheeze whereby they send their bikes to Britain through a GSP country, knowing that the rule that 60 per cent. of the components have to be made in that country and that the condition of GSP preference is that 60 per cent. of the product be manufactured in that country are being broken.
There emerges the picture of ruthless men in the east aiming to destroy our bicycle market. We are dealing with cunning Chinese business men who are making a killing on the manufacture of bikes and throwing our work force on the dole.
When Raleigh buys Shimano gears from Japan it has to pay duty of 8.1 per cent. The far eastern bloc avoid paying any tax on any part of any bike as a result of the devices that I have outlined. This is a horror story. Free trade is being choked. State-run dictatorship is destroying yet another manufacturing industry in Britain. Where is the guardian angel? Where is the Minister for Trade? Have his wings been clipped? Will evil triumph?
There is a sub-plot. European Community officials are trying to correct the balance by instructing the Chinese to pay 34.4 per cent. tax on every bike imported. They believe that that is the figure that is needed to correct the unlevel playing field. Yet Commissioner Brittan has been prevented from signing. Why will he not sign? Has something been done to his right hand? Is he part of the plot? Is there something going on about which we do not know? Let us not forget the clever lawyers being employed in Brussels by the Chinese to help them to corner the market.
But the Chinese will clearly have the last laugh. Their bikes are not safe. Often, their brakes just do not work in the rain and do not conform to BS6102. When the European Community finally put on the 34.4 per cent., the unsuspecting British public will find themselves unable to stop as they head towards a brick wall.
10.14 pm
Mr. Harry Greenway: With the permission of my hon. Friend the Member for South Hams (Mr. Steen) and the Minister for Trade, I shall speak for one minute strongly to support my hon. Friend. I speak as chairman of the all-party parliamentary friends of cycling group. I wish to give two statistics which should be laid before the House.
In Denmark, 11 per cent. of the population still cycle to work whereas in the United Kingdom the figure is only 4
982
per cent. People here have enough to contend with, such as dangerous roads, without having dangerous bicycles from China foisted on them.
It must be said that the ruthlessness with which the Chinese have set about getting bicycles into this country has to be observed in practice to be believed. It is only right that our great cycle industry—Raleigh and other companies have been mentioned—should he allowed a level playing field on which to operate. However, they demonstrably do not have a level playing field, as my hon. Friend the Member for South Hams so graphically outlined. We are looking to the Minister for Trade to ensure that the industry has a level playing field in the interests of our nation and of cyclists in particular.
10.15 pm
Mr. Gary Waller: I am grateful to my hon. Friend the Member for South Hams (Mr. Steen) for providing me with a brief opportunity to support him in the debate. He made his strong case with flamboyance and sincerity.
In a brief intervention, my hon. Friend the Member for Blaby (Mr. Robathan) drew a comparison with the destruction of the British motor cycle industry and, of course, in many ways he is right. However, there is one difference. We must admit that the Japanese stole a march on our motor cycle industry because, in many respects, their products were technologically more advanced but the products of the British cycle industry are technically supreme. Hon. Members who saw examples of its frames recognised that the most modern technology—space technology—is now being used, and nothing can compare with those frames.
My hon. Friend the Member for South Hams mentioned anomalies which, for example, allow importers to pay nothing on components which are popular with all purchasers these days—Japanese components such as brakes and gear sets—whereas United Kingdom manufacturers importing the same components have to pay 8 per cent.
My hon. Friend also referred to dumping and the fact that injury has been proved by a European Community investigation. More than 2 million bicycles have been dumped on the United Kingdom market since 1987. Now that the United States has taken action to deal with dumping, we can expect to see more diversion into our market. The downhill path has been rapid because in six years imports from the far east have grown from 29 per cent. to 70 per cent. That is an unimaginable change in such a short time.
The message to the Minister is clear. There must be ratification as soon as possible of the anti-dumping measures which are now regarded as justified by the EC investigation. It is necessary to deal speedily with the anomalies that enable far east importers to undercut our excellent home-produced bicycles.
10.17 pm
The Minister for Trade (Mr. Richard Needham): I have seen the yellow peril knocking at the door, and I understand my hon. Friends' concern. I fully support their comments about the lack of interest shown by the Opposition, especially as many Labour Members represent areas in which bicycle manufacturing still exists.

983
We must consider a series of issues. My hon. Friend the Member for South Hams (Mr. Steen) rightly said that the matter falls under European Community competence. He knows perfectly well that the only power I have is to try to move on the debate in Europe. I am not sitting at the elbow of Sir Leon Brittan, giving him the pen. Were I in that happy position, he would no doubt have already signed the anti-dumping measure that we have supported in the European Community. However, it is an EC matter, and two separate issues are involved. One is the GSP—the generalised system of preferences—problem about bikes coming in up to a quota level which, as my hon. Friend the Member for South Hams said, because of the way in which the rules operate, can then be circumvented by the Chinese continuing to export bikes until a GSP abuse has been proved.
The key question is dumping, because that introduces an element of a tax of 34 per cent., which represents a considerable additional benefit compared with 8 per cent. Put another way, after the devaluation of the pound, that 8 per cent. has disappeared to our benefit because of that devaluation. Even so, we accept that there has been a proven case of dumping and that we should move against it. We are doing what we can, and will continue to do so, to pressurise the Community to move in that direction.
The Chinese ride around on bikes. They may produce 40 per cent. of the world output of bikes, but—I do not have the figures with me—they are also by far the world's biggest riders of bikes. It is no good our now saying that China is a backward third-world country which is not capable of making modern bicycles. The Chinese can make them. My hon. Friend the Member for South Hams says that they have been supported in that effort by the World bank. So they have, as have many other third-world countries, with the aim of trying to modernise their industries and raise their standards of living.
I accept that Chinese workers are paid much less than British workers. Unfortunately, that does not preclude them, under the rules that operate not only in terms of the Community but in terms of GATT, manufacturing products that they sell to this country. If all Chinese workers were paid as much as British workers, no doubt it would be a truly level playing field, but they are not and I am not clear what my hon. Friend suggests we should do about that.
We have an advantage in that our workers are paid, including the social cost, half that of German workers. Are we to make the same argument about dumping British products in Germany because our workers are paid half as much as theirs? That would be a dangerous route to take.
We must look at the matter of fair trade, and my hon. Friend raised a series of questions about that. He asked whether the Chinese were trying to get round the 8 per cent. by moving their finished bikes to Thailand, Indonesia, Malaysia or wherever. If my hon. Friend has evidence to that effect, he should let us have it. The only way we can tell whether a bike comes from Indonesia or China is to ask the relevant authorities in, say, Indonesia whether it is an Indonesian bike. If they say it is, we must believe that, unless we are given evidence to the contrary.
I cannot see why the Indonesians, who are not rich, should take massive numbers of Chinese bikes into Indonesia to bring them here, unless there is that level of
984
corruption. In relation to Indonesia, Thailand or Malaysia, what would be the reason for them doing that? Perhaps they are Indonesian bikes, and that is one of the problems. If duties were imposed on China, perhaps they would, as my hon. Friend the Member for South Hams suggested, move out of Taiwan and start making bikes in Indonesia, which they might move to somewhere else, perhaps to India or Sri Lanka. So the problem is that one is continually chasing a chain which it is hard to catch. But if my hon. Friend is right about the bikes being moved, we shall act on that.
My hon. Friend did not make the point—I will make it for him—that it seems strange that one should have to prove the case twice. In other words, if there is an anti-dumping measure against China, it would seem reasonable to assume that one should not then have to prove further damage because China exceeded its GSP quota. I assure my hon. Friend that we shall take up the matter with the Commission to see how we can bring it to bear.
My hon. Friend the Member for South Hams raised the question of safety. I appreciate why we need a level playing field in regard to bikes—otherwise, he is right in saying that we might go downhill and crash into a wall if the brakes did not work. There are the environmental health officers; there are the pedal bicycles safety regulations. My hon. Friend is a great expert on the subject, as are some of my other hon. Friends. Why are those regulations not being enforced? If the bikes are unsafe and fail to meet British standards, what are the environmental health officers doing? What is the Department of Transport doing?
Mr. Steen: That is a good question.
Mr. Needham: It is indeed, but as this is the first time that the matter has been raised before us, or before you, Madam Speaker, I am not in a position to answer it tonight—except to say that I shall raise the matter with the Department of Transport and the environmental health officers to find out what they are doing. If the bikes are dangerous, I need my hon. Friend to give me the details.
Mr. Steen: I am grateful to my hon. Friend for what he has said so far, but two points arise. The first matter that troubles me is that there is a world of difference between trade between Britain and Germany, which are parts of the same European Community, and trade between China and Britain, in which China is using its cheap labour to bring in bikes that are undermining our industry—we have precious little manufacturing industry left in this country —and causing gross unemployment. Secondly, there is now overwhelming evidence that many of the Chinese bikes are unsafe in wet weather.
Mr. Needham: I am grateful to my hon. Friend for those allegations, but they must be proven. If they can be proven, action will be taken.
My hon. Friend said that partly assembled bikes were flooding into the country to be made up here. Customs and Excise tell me that they have a monitoring system and have checked a number of consignments of bicycle parts from China, and that they have found no evidence of the practice. As a member of the party in government, my hon. Friend knows perfectly well that the Government cannot

985
act on such matters unless there is proof of the malpractice. I give him a categorical guarantee that, if we have such evidence, we shall act upon it.
The fact that some countries have cheaper labour than others—whether we are talking about us against Germany or China against us—is not a reason for excluding goods from third-world markets. This country has always stood for free trade. As my hon. Friend said, the reasons for the demise of the British motor cycle industry were significantly different from those that we now face.
We shall do everything that we can to assist our bicycle industry and protect it against dumping and any unnecessary abuse of the world's trading system, but my hon. Friends will have to accept that we must work within the rules laid down both in the Community and by the GATT. I hope that my hon. Friend will not take this amiss, but his speech is not so different from the speech that President Clinton made recently about airbus subsidies, steel dumping in the United States, and so on. Those things, too, affect British jobs.
I accept what my hon. Friend says about dumping and the misuse of existing regulations—we all agree on that
986
—but we must be careful not to wind up the people of this country into believing that a way to solve the problem is to introduce protectionism by the back door. That would not benefit us as a nation.
I agree that our manufacturing base is narrower than it should be, and that we have to build it up; but we can do that not least in a market such as China. In China there are enormous opportunities for us to build power stations, transport networks and metro underground systems, and to set up factories ourselves. We can do enormous business there, in the fastest growing economy on earth, which will create many British jobs in future.
It is all a matter of balance. We shall do whatever we can to stop unfair trading practice, but I am sure that my hon. Friend will accept that we must maintain the balance and continue to support fair trade—because free trade is the salvation of our manufacturing industry.
Question put and agreed to.
Adjourned accordingly at Twenty-nine minutes past Ten o'clock.

LORD CHANCELLOR'S DEPARTMENT

  High Court Judges
  Mr. Ottaway
  To ask the Parliamentary Secretary, Lord Chancellor's Department when he received a copy of the Kennedy working party report on High Court judges; and if he will make a statement.

  Mr. John M. Taylor
  The report was received by the Lord Chancellor on 10 February 1993.

  Legal Aid
  Mr. John Morris
  To ask the Parliamentary Secretary, Lord Chancellor's Department whether he will publish the advice given to the Lord Chancellor by the Legal Aid Advisory Committee on his proposed changes in legal aid.

  Mr. John M. Taylor
  The Legal Aid Advisory Committee has itself already made public its advice to the Lord Chancellor on the proposed eligibility changes and the Lord Chancellor's response to its advice. I have placed copies of the correspondence in the Library.

FOREIGN AND COMMONWEALTH AFFAIRS

  European Communities (Amendment) Bill
  Mr. Austin Mitchell
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list the legal issues in connection with the European Communities (Amendment) Bill on which he has made public statements, indicating on which of them he sought advice from(a) his Department's lawyers, (b) Crown Law Officers and (c) European Court legal advisers.

  Mr. Garel-Jones
  We have taken legal advice from various sources during the passage of the European Communities (Amendment) Bill. It is neither customary nor appropriate for me to reveal these sources.

  Mr. John Morris
  To ask the Secretary of State for Foreign and Commonwealth Affairs whether legal advice was sought before 20 January on the effects of amending the European Communities (Amendment) Bill.

  Mr. Garel-Jones
  Yes.

  Whitehead Detention Camp, Hong Kong
  Mr. David Atkinson
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many reported incidents there have been of(a) total number of crimes reported, (b) murders, (c) attempts to escape, (d) incidents of rape, (e) incidents of child sex abuse, (f) drug abuse, (g) abortions and (h) suicides for each year at the Whitehead detention camp in Hong Kong.

  Mr. Goodlad
  The figures for 1991 and 1992 are as follows:
  572

  1991

  1992

  (a) Total number of crimes reported

  844

  588

  (b) Murder cases

  4

  4

  (c) Escapes

  419

  263

  (d) Rape cases reported

  2

  2

  (e) Reports of sex abuse

  0

  0

  (f) Arrests involving dangerous drugs

  5

  7

  (g) Illegal abortions

  0

  0

  (h) Suicides

  10

  1

  1 And two attempts.

  Population of Whitehead Detention Centre

  Number

  1 January 1991

  22,528

  1 January 1992

  24,856

  Official Entertainment
  Mr. Tony Banks
  To ask the Secretary of State for Foreign and Commonwealth Affairs how much was spent on official entertainment in his Department during 1991–92 and 1992–93 to date.

  Mr. Goodlad
  The following was spent on entertainment by the Foreign and Commonwealth Office and the Overseas Development Administration:

  £

  1991–92

  5,700,606

  11992–93

  3,943,940

  1 To date.

  Angola
  Mr. Burden
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will support mandatory sanctions against UNITA, including the banning of all lethal and non-lethal supplies and all flights to and from UNITA-controlled areas of Angola.

  Mr. Lennox-Boyd
  Resolution 804, adopted by the United Nations Security Council on 29 January, urged members to cease the supply of lethal material to any Angolan party. We keep the situation under review, but do not believe that mandatory sanctions could be effectively applied against UNITA.

  Mr. Burden
  To ask the Secretary of State for Foreign and Commonwealth Affairs what efforts he is making to promote the ending of the current conflict in Angola through the implementation of the peace accords which were agreed with the Angolan Government on 31 May 1991.

  Mr. Lennox-Boyd
  The Government fully support United Nations efforts to promote dialogue between the Government of Angola and UNITA with a view to agreeing a ceasefire and full implementation of the Bicesse peace accords. With our EC partners, we have urged UNITA to agree a date for a further meeting with the Government of Angola to be held under United Nations auspices in Addis Ababa, and to agree to a truce in the besieged city of Huambo.

  Kenya
  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of(a) the treatment of ethnic and political minorities in Kenya and (b) other aspects of the present human rights situation; and what advice he has given to the Kenyan Government about the necessary human rights provisions in Kenya for the continued provision of aid.

  Mr. Lennox-Boyd
  We have expressed concern at the highest levels over recent renewed outbreaks of ethnic clashes and have stressed the importance of the Kenyan Government providing security for all Kenyan citizens. My right hon. and noble Friend the Minister for Overseas Development has also raised concerns over Kenya's human rights performance, a key factor which Her Majesty's Government take into account when allocating aid.

  South Africa
  Mr. Caborn
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement concerning the European Community observer mission in South Africa.

  Mr. Lennox-Boyd
  The European Community observer mission in South Africa—ECOMSA—is making a valuable contribution to defusing violence and reducing tensions. ECOMSA, together with the Commonwealth team, has been particularly praised for its professionalism, and has rapidly built extensive relations with, for example, local political organisations, peace accord structures and the South African police. They have the advantage of comprising several senior serving police officers with experience in, for example, community policing.

  Mr. Caborn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what are the terms of reference of the European Community observer mission in South Africa; what is the period of the mandate of the mission; what is the size of the mission; what is the number of members from each EC member state; and in which areas of South Africa it is operating.

  Mr. Lennox-Boyd
  The European Community observer mission in South Africa was deployed in accordance with the terms of Security Council resolution 772 to work in association with other international observer groups and the structures of the national peace accord as part of their efforts to reduce tension and end violence.

  The mission was initially deployed for six months, with effect from October 1992, and comprises 15 members contributed from member states as follows:

  Number

  United Kingdom

  2

  Denmark

  2

  France

  1

  Germany

  2

  Greece

  1

  Ireland

  2

  Netherlands

  2

  Portugal

  1

  EC Commission

  2

  574
  The EC observers are at present deployed with six members at the ECOMSA headquarters in Johannesberg, four members in Durban and two members in East London and Cape Town respectively.

  Mr. Caborn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans there are to extend the period of the mandate of the European Community observer mission in South Africa beyond the current expiry date.

  Mr. Lennox-Boyd
  This is under consideration among the Twelve. A decision is expected shortly.

  Mr. Caborn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what arrangements have been made for the European Community observer mission in South Africa to report to(a) the Presidency of the Council of Ministers, (b) the Council of Ministers, (c) the structures of European political co-operation, (d) the Commission of the European Communities, (e) the European Parliament and (f) the national parliaments of the member states of the European Community.

  Mr. Lennox-Boyd
  Regular reports are submitted to the presidency. These are made available for discussion as necessary by European Community Foreign Ministers. They are also circulated to all member states and can be drawn on to inform their parliaments as appropriate.

  Mr. Caborn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what recommendations the European Community observer mission in South Africa has made to(a) the presidency and (b) the Council of Ministers.

  Mr. Lennox-Boyd
  To date, the reports of the European Community observer mission in South Africa have been factual commentaries on the situation and about action engaged in by team members.

  Mr. Caborn
  To ask the Secretary of State for Foreign and Commonwealth Affairs on which dates the Council of Ministers has discussed the question of the European Community observer mission to South Africa since October 1992.

  Mr. Lennox-Boyd
  This matter has not been discussed by the Council of Ministers since October 1992.

  Mr. Caborn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what consideration the Council of Ministers has given to the possibility of expanding the European Community observer mission to South Africa and extending its mandate when agreement is reached on the calling of one person one vote elections.

  Mr. Lennox-Boyd
  This question has not yet been considered by the Council of Ministers. Any election-monitoring mission would be different in nature, and would probably have to operate separately, from the current observer exercise.

  Mr. Caborn
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many United Kingdom citizens are currently attached to(a) the United Nations observer mission to South Africa, (b) the European Community observer mission to South Africa, (c) the Commonwealth observer group to South Africa and (d) the Goldstone commission.
  575
  Mr. Lennox-Boyd
  There are three United Kingdom citizens currently serving with the United Nations observer mission to South Africa, two with the European Community observer mission, one with the Commonwealth observer group to South Africa, and one with the Goldstone commission.

TRANSPORT

  Suffolk Railways
  Mr. David Porter
  To ask the Secretary of State for Transport if he will make a statement on the money to be spent on(a) safety and (b) capital investment by regional railways in Suffolk in the next financial year.

  Mr. Freeman
  The disaggregation of expenditure at this level is a matter for British Rail. It is for BR to determine what safety-related expenditure is required in each area and how the available capital investment resources should be shared out.

  Consultants
  Ms. Mowlam
  To ask the Secretary of State for Transport if he will list the contracts awarded by his Department to(a) Coopers and Lybrand management consultants, (b) Touche Ross management consultants, (c) Price Waterhouse management consultants, (d) Ernst and Young management consultants, (e) Chrichton Roberts Ltd., (f) KPMG management consultants and (g) Leopold Joseph management consultants, with the total cost of the contracts with each contractor, for (i) the past 12 months and (ii) 1991–92.

  Mr. Kenneth Carlisle
  The following contracts were awarded by the Department of Transport:

  (i) THE PAST 12 MONTHS:

  (a) Coopers Lybrand Management Consultants—

  A Review of the Inspectorate's Performance Measures.

  DVOIT Job Costing.

  TRL's Temporary Finance Director.

  Independent Assessment and Review of Sale of Marks —Market Testing Assignment.

  Total cost £178,000.

  b. Touche-Ross Management Consultants—

  HQ Accommodation Study.

  Preparation of an Operation Requirement for Design and Development of a Property Management Information System for PMT.

  Preparation of an OR for a Property Management Information System.

  Total cost £143,000.

  c. Price Waterhouse Management Consultants—

  Advice on personnel arrangements.

  Total cost £68,000.

  d. Ernst and Young Management Consultants—

  Development of Decision Framework to Assist DOT with European Standardisation.

  Commission to Design, Develop and Implement a Payroll Modelling System.

  HQ Accommodation Management Implementation Study.

  IS/IT Scoping Study.

  IS/IT Full Study.

  Total cost £380,000.

  576

  e. Chrichton Roberts Ltd.

  Total cost Nil.

  f KPMG Management Consultants—

  Pilot Implementation of Project Software.

  Implementation Study—Business Analysis—Extension to cover Local Authority Issues.

  Advice on Networking Policy.

  Network referencing Phase 1

  Total cost £403,000.

  g. Leopold Joseph Management Consultants

  Total cost Nil.

  ii. 1991–92

  a. Coopers Lybrand Management Consultants—

  DVOIT Agency Implementation Support.

  Study of EC Directive and Rail Liberalisation.

  Total cost £591,000.

  b. Touche-Ross Management Consultants—

  Accommodation Management Information Study.

  Property management information system for AOSD.

  Total cost £105,000.

  c. Price Waterhouse Management Consultants

  Total cost Nil.

  d. Ernst Young Management Consultants—

  Study of the Options of a Payroll Modelling System for PMT.

  Preparation for the Design and Development of Payroll Modelling System.

  Total cost £66,000.

  e. Chrichton Roberts Ltd.

  Total cost Nil.

  f. KPMG Management Consultants—

  Assisting in Developing a Management Accounting Model.

  PMS DOT Implementation Study—Business Analysis.

  Information Systems Strategy for the Vehicle Inspectorate.

  Total cost £205,000.

  g. Leopold Joseph Management Consultants—

  Total cost Nil.

  Ms. Mowlam
  To ask the Secretary of State for Transport how many contracts for consultancies were awarded by his Department over(a) the last 12 months and (b) 1991–92.

  Mr. Kenneth Carlisle
  The following consultancy contracts, including management consultancies, were awarded by the Department of Transport over:

  (a) Last 12 months: 298 and (b) 1991–92: 288.

  In the case of both (a) and (b) the majority of contracts are in the general and research areas—management consultancy contracts are not a high proportion of the total numbers.

  Publicity
  Mr. Morgan
  To ask the Secretary of State for Transport, pursuant to his answer of 2 June 1992 to the hon. Member for Holborn and St. Pancras (Mr. Dobson),Official Report, columns 510–11, what is his Department's (a) current outturn estimate for publicity expenditure for 1992–93 and (b) budgeted publicity expenditure for 1993–94.

  Mr. Kenneth Carlisle
  The current estimated outturn for publicity expenditure for 1992–93 by my Department is £8–78 million. The 1993–94 estimates will be considered by Parliament on 9 March, after which budgets will be published. The budget for 1993–94 is expected to be in line with 1992–93 expenditure in real terms. These estimates do not include publicity expenditure by the Department's executive agencies.

  Cyclists
  Mr. Cox
  To ask the Secretary of State for Transport if his Department will introduce a public campaign on the need for cyclists to have both a front and rear light when riding a pedal cycle during the hours of darkness; and if he will make a statement.

  Mr. Kenneth Carlisle
  My Department is planning to launch a cycling safety campaign in March and our publicity material will include advice on the use of lights by cyclists.

  Mr. Hall
  To ask the Secretary of State for Transport what steps he proposes to introduce to stop motorists driving too close to motor cyclists and pedal cyclists.

  Mr. Kenneth Carlisle
  Advice to motorists to give cyclists plenty of room is contained in the "Highway Code", "The Driving Manual", "Your Driving Test" and a leaflet currently being issued with vehicle excise duty reminders.

  Pedestrian Crossings
  Mr. Clifton-Brown
  To ask the Secretary of State for Transport what conclusions the Transport Research Laboratory has come to for the criteria which need to be applied to the installation of pedestrian crossings and islands to meet the needs of vulnerable people; and if he will make a statement.

  Mr. Kenneth Carlisle
  The Transport Research Laboratory has carried out research into pedestrians' use of crossings, the effectiveness of the crossings and accidents which occur.

  As a result, the assessment criteria for the provision of pedestrian crossing facilities are being revised to remove the existing numerical criteria and encourage more account to be taken of local needs.

  The new Puffin pedestrian crossing which is being developed makes it easier and safer for all pedestrians. it automatically extends the crossing time as needed for elderly and disabled pedestrians. The TRL is continuing to monitor and assess the new crossing design.

  Advice has been issued to local authorities on the provision of dropped kerbs and tactile paving at pedestrian crossing points to improve the safe and independent mobility of wheelchair users and visually impaired people.

  Severn Crossing
  Mr. Llwyd
  To ask the Secretary of State for Transport how many representations he has received since May 1992 concerning developing(a) the current Severn bridge and (b) the second Severn crossing as toll-free bridges.

  Mr. Kenneth Carlisle
  We have received since May 1992 some 150 representations about the reduction or removal of the tolls specified in the Severn Bridges Act 1992. Very few of them distinguish between the two bridges.

  Electric Cars
  Mr. Dafis
  To ask the Secretary of State for Transport what research has been undertaken by his Department on the possible use and development of electric cars in the United Kingdom.

  Mr. Kenneth Carlisle
  The Transport Research Laboratory is soon to complete a review of worldwide research and experience in the use and environmental impact of alternative fuels including electricity. This covers various road vehicles including cars. It will draw on earlier TRL work on electric vehicles which included published reports on their market prospects, energy consumption and refuelling infrastructure.

  The Department is also funding a study examining the feasibility of limited in-service field trials of vehicles using a range of alternative fuels including electricity.

  In addition, engineers in the Department continue to keep abreast of electric vehicle developments worldwide, and I welcome the continuing efforts by manufacturers to develop advanced batteries and more competitive electric vehicles.

  British Rail (Public Service Obligation)
  Mr. Wilson
  To ask the Secretary of State for Transport what is the relationship between the public service obligation grant for 1993–94 and the 1988 public service obligation directive to British Rail; and if he will make a statement.

  Mr. Freeman
  Public service obligation grant is paid to meet the cost to British Rail of compliance with the obligation laid down, which is currently defined in the Secretary of State's direction of 30 March 1988. Payments made in the years since the direction was issued have varied according to need. The Government's initial estimate of grant needed for 1993–94 is £850 million, but the amount to be paid will be settled in the light of the board's budget, still in preparation, and may be subject to subsequent adjustment.

  Coaches
  Mrs. Anne Campbell
  To ask the Secretary of State for Transport what is the difference between the minimum standards of construction for coaches registered in the United Kingdom for coaches which do not exceed 60 mph and those for coaches which travel at speeds up to 70 mph; and if he will exempt coaches which do not exceed 60 mph from the requirement to have seat belts fitted even in exposed seats.

  Mr. Kenneth Carlisle
  Coaches and large buses that can exceed 60 mph are required to have anti-lock brakes and
  579
  seat belts on exposed seats and, from 1 April 1993, to comply with European superstructure strength requirements.

  These features are not required for large buses that cannot exceed 60 mph. They operate normally at low speed on short town and city routes. The need for belts and the likelihood of their being used are less than on faster long-distance coaches and we have no plans to make them compulsory.

  Mrs. Anne Campbell
  To ask the Secretary of State for Transport if he will make it his policy to tighten up regulations on the construction of coaches registered in the United Kingdom which travel at speeds not exceeding 60 mph.

  Mr. Kenneth Carlisle
  No, but I intend to monitor the situation. If it becomes apparent that coach operators are generally using vehicles of lower than appropriate safety standards, I will consider new measures.

  Mrs. Anne Campbell
  To ask the Secretary of State for Transport from what year coaches will be restricted to a maximum speed of 100 kilometres per hour(a) on the continent and (b) in the United Kingdom; what effect these restrictions will have on the safety standards of coaches manufactured in the United Kingdom; and what representations he has received from coach manufacturers on this subject.

  Mr. Kenneth Carlisle
  EC directive 92/6 requires speed limiters on new coaches to be set at 100 km/h from 1 January 1994. It will also apply to coaches registered after 1 January 1988 from 1 January 1995 if the coach is used for international transport and from 1 January 1996 if the coach is used for national transport. We will be consulting shortly on draft regulations to implement the directive.

  The safety standards applying to the construction of coaches are not directly affected by the directive.

  I have been approached on the subject of safety by one United Kingdom coach manufacturer.

  Rail Privatisation
  Mr. Wilson
  To ask the Secretary of State for Transport (1) what are the costs so far to(a) British Rail and (b) his Department of preparing for the privatisation of railways;

  (2) what are (a) the staff costs and (b) the consultancy fees he expects (i) British Rail and (ii) his Department to incur in 1992–93 and 1993–94 in preparing for privatisation;

  (3) what sums (a) British Rail and (b) his Department have budgeted for 1993–94 to meet the cost of preparing for rail privatisation.

  Mr. Freeman
  The Department of Transport's internal BR privatisation costs cannot be separately identified before September 1991. The following costs include those of special advisers where appropriate:

  £ million

  1991–92

  0.5

  1992–93 estimated outturn

  1.5

  1993–94 expected expenditure

  9.5

  Consultants' costs:

  1991–92

  0.5

  1992–93 estimated outturn

  5.2

  1993–94 expected expenditure

  12.0

  580
  British Rail's costs and estimates are a matter for British Rail.

NATIONAL HERITAGE

  Listed Buildings
  Mrs. Anne Campbell
  To ask the Secretary of State for National Heritage what plans he has to transfer the responsibility for grade I listed buildings from English Heritage to local authorities.

  Mr. Brooke
  English Heritage's forward strategy, published last October, proposed certain changes to responsibilities for grade II listed building and conservation area casework in London. Revised proposals have recently been put to me following public consultation, and I am considering them. The strategy proposed no change in current responsibilities for grade II buildings outside London.

  Football Licensing Authority
  Mr. Brazier
  To ask the Secretary of State for National Heritage when the Football Licensing Authority will begin to issue licences; and if he will make a statement.

  Mr. Brooke
  Licensing will be introduced in time for the start of the 1993–94 football season in August. Accordingly, section 9 of the Football Spectators Act, which creates the offence of admitting spectators to unlicensed premises, will be brought into force during the close season.

  I also intend to use the powers conferred on me by section 11 of the 1989 Act to make an order ensuring that clubs in the Premier League and first division meet the August 1994 deadline for all-seater stadiums. I will therefore begin shortly the statutory consultations which will lead to the inclusion of seating requirements in next year's licences.

  Initially, I intend to levy only a nominal fee of £100. The level of the fee will be kept under review, and is likely later to be raised to reflect more closely the full costs involved in determining the licence conditions.

  The Government continue to support the principles of spectator safety and comfort as set out in the Taylor report. We remain firmly committed to the all seater requirement for the top two divisions, and to the implementation of safe terracing for those in the lower divisions that choose not to provide all-seating. The introduction of licensing will be a major step in achieving these aims.

HEALTH

  Nursing Care Beds
  Ms. Lynne
  To ask the Secretary of State for Health how many nursing care beds for elderly people were available in hospitals in each regional health authority in each of the last 10 years.

  Mr. Yeo
  [holding answer 19 February 1993]: The average number of available beds in wards caring for elderly patients is given in the table. There is no separate classification of "nursing care beds".
  581

  Average number of available beds in wards caring for elderly patients

  1982

  1983

  1984

  1985

  1986

  1987–88

  1988–89

  1989–90

  1990–91

  1991–92

  England

  55,646

  55,801

  55,571

  55,320

  54,588

  53,275

  51,042

  48,733

  45,902

  42,107

  Northern

  3,809

  3,885

  3,894

  3,940

  3,949

  4,075

  3,958

  3,834

  3,683

  3,435

  Yorkshire

  5,090

  5,041

  4,938

  4,960

  4,827

  4,621

  4,291

  4,136

  3,909

  3,575

  Trent

  5,204

  5,229

  5,233

  5,237

  5,263

  5,116

  4,901

  4,655

  4,411

  4,050

  East Anglian

  2,372

  2,417

  2,452

  2,467

  2,497

  2,539

  2,500

  2,432

  2,373

  2,240

  North West Thames

  3,366

  3,329

  3,380

  3,417

  3,460

  3,386

  3,305

  3,329

  3,173

  2,808

  North East Thames

  4,555

  4,574

  4,635

  4,636

  4,614

  4,260

  3,972

  3,878

  3,483

  3,179

  South East Thames

  4,237

  4,233

  4,088

  3,985

  3,740

  3,535

  3,384

  3,324

  3,212

  2,903

  South West Thames

  3,064

  3,035

  2,975

  2,907

  2,878

  2,832

  2,834

  2,555

  2,566

  2,422

  Wessex

  3,543

  3,510

  3,477

  3,468

  3,433

  3,203

  3,022

  2,923

  2,780

  2,765

  Oxford

  2,027

  2,006

  1,974

  1,866

  1,825

  2,054

  1,832

  1,819

  1,647

  1,457

  South Western

  3,771

  3,848

  3,807

  3,782

  3,720

  3,486

  3,464

  3,366

  3,240

  2,925

  West Midlands

  6,256

  6,230

  6,235

  6,176

  6,054

  6,004

  5,665

  5,084

  4,846

  4,434

  Mersey

  3,136

  3,171

  3,180

  3,120

  3,042

  2,909

  2,786

  2,523

  2,047

  1,870

  North Western

  5,135

  5,193

  5,175

  5,230

  5,161

  5,128

  5,001

  4,747

  4,406

  3,916

  Special Health Authorities

  80

  102

  127

  130

  126

  128

  128

  128

  127

  127

  Source: SH3 1982–1986

  KHO3 1987–88 to 1991–92

NATIONAL FINANCE

  Alcohol Imports
  Mr. Nigel Evans
  To ask the Chancellor of the Exchequer what would the average tax saving be in(a) excise duty and (b) VAT to an individual buying the full indicative allowance of beer in France and importing into the United Kingdom for personal consumption, compared with purchasing the same amount in the United Kingdom.

  Sir John Cope
  The guidance level for duty paid beer is 110 litres. On beer of typical strength, the excise duty in the United Kingdom is 41p per litre or £45.10 for 110 litres compared with £2–57 for 110 litres in France. French duty is due to rise from 2p to 7.5p a litre or £8.25 for 110 litres in May. The United Kingdom applies a VAT rate of 17.5 per cent. on beer compared with 18.6 per cent. in France. The amount of VAT that is liable on 110 litres of beer in either country will vary according to the product.

  Mr. Nigel Evans
  To ask the Chancellor of the Exchequer how many arrests have been made by Her Majesty's Customs and Excise verification officers since 1 January of persons illegally selling alcohol bought in France or Belgium at lower excise duty rates and imported to the United Kingdom ostensibly for personal use.

  Sir John Cope
  In January, Customs detected 36 cases of illegal sales of excise goods. Of these, 13 related to alcohol. Customs take legal proceedings by way of arrest when appropriate, but other options, such as proceeding by way of information and summons, are also available. Two arrests were made. Other forms of offence action have been taken or are being considered in the remaining cases.

  Manufacturing Investment
  Ms. Harman
  To ask the Chancellor of the Exchequer what information he has about the level of manufacturing investment in(a) 1990, (b) 1991 and (c) 1992; and if he will make a statement.

  Mr. Nelson
  Estimates of manufacturing investment for 1990, 1991 and 1992 at constant prices were published in the 1992 fourth quarter capital expenditure press notice 582
  released by the Central Statistical Office on 11 February 1993. The 1992 figure is provisional. Copies of the press notice are available in the House of Commons Library.

  Monetary Policy
  Ms. Harman
  To ask the Chancellor of the Exchequer which monetary aggregate takes precedence in the formation of policy in the event of M0 rising above and M4 falling below their respective target ranges.

  Mr. Nelson
  Current spending in the economy has in the past been more closely related to M0 than to M4. The authorities also take account of a number of other domestic indicators, as well as the exchange rate, in their monetary policy decisions.

  Bank Notes
  Mr. Bayley
  To ask the Chancellor of the Exchequer what was the cost of redesigning and issuing the new £5, £10 and £20 Bank of England notes; and what will be the cost of redesigning and reissuing revised notes which are easier to distinguish from each other.

  Mr. Nelson
  The cost of designing the new £5, £10 and £20 Bank of England notes, including subsequent changes in design, falls within the normal research and development expenditure of the Bank of England printing works which amounts to some £750,000 a year.

  In introducing the new series of banknotes, the opportunity was taken to incorporate features in the design and in the printing processes which reduced the cost of producing notes. The cost of printing and issuing banknotes amounts to some £60 million a year. The revised versions of the new notes will be issued in the normal course of replacing worn notes, so there will be no additional issuing costs.

  Imports
  Ms. Harman
  To ask the Chancellor of the Exchequer what estimate he has made of the effect of the change in the value of the pound sterling since 14 September 1992 on the cost of imports in the last quarter of 1992.

  Mr. Nelson
  In addition to the external value of the pound, import prices depend on world prices and importers' profit margins. Thus, it is not possible precisely to isolate the impact of the change in the exchange rate.

  Publicity
  Mr. Morgan
  To ask the Chancellor of the Exchequer, pursuant to his answer of 2 June 1992 to the hon. Member for Holborn and St. Pancras (Mr. Dobson),Official Report, column 397, what is his Department's (a) current outturn estimate for publicity expenditure for 1992–93 and (b) budgeted publicity expenditure for 1993–94.

  Mr. Nelson
  The estimated spending on publicity during 1992–93 is £32,000. This is lower than the figure given on 2 June and the difference mainly results from the transfer of Chessington computer centre from the Treasury to the Office of Public Service and Science. Budgeted expenditure for 1993–94 is £50,000.

  Retail Sales
  Ms. Harman
  To ask the Chancellor of the Exchequer what information he has about the level of retail sales in(a) November 1992 and (b) January 1993; and if he will make a statement.

  Mr. Nelson
  The estimate of the volume of retail sales —seasonally adjusted—in November 1992 is 121.6; 1985 = 100. The provisional estimate for January 1993 is 122=3. The level of sales volumes in the three months to January equalled the record level recorded in the three months to November.

  Environmental Protection
  Mr. Pawsey
  To ask the Chancellor of the Exchequer what assessment he has made of the impact on environmental protection of a windfall tax on the utility companies.

  Mr. Dorrell
  None, but in the absence of other changes, an increase in the tax burden on utilities would reduce the resources available to them.

  Mr. Pawsey
  To ask the Chancellor of the Exchequer if he will list the scope and value of tax incentives for companies for environmental protection projects for the last year for which figures are available.

  Mr. Dorrell
  There are no specific incentives for companies' environmental projects, but the taxation system as a whole contains many incentives to protect the environment. These include the level of hydrocarbon oils duties and capital allowances which already cover energy saving investment.

  Windfall Tax
  Mr. Pawsey
  To ask the Chancellor of the Exchequer how many times a windfall tax has been levied since 1961; which types of companies were affected; and if he will make a statement.

  Mr. Dorrell
  The term "windfall tax" is not clearly defined. Development gains tax–1973—development land tax–1976—the tax on banks' interest—free deposits –1981—and supplementary petroleum duty–1981—were introduced in response to what were seen as exceptionally high profits. The first two applied to gains on disposals of development land by firms in any sector, the third to the banking sector and the last to the oil industry.

  Environmental Variables
  Mr. Dafis
  To ask the Chancellor of the Exchequer what efforts have been made to date to integrate environmental variables into national accounting systems.

  Mr. Nelson
  1 refer the hon. Member to the answer I gave to the hon. Member for Southwark and Bermondsey (Mr. Hughes) on 8 December 1992, at columns 571–72.

  Cycle Helmets
  Miss Lestor
  To ask the Chancellor of the Exchequer what representations he has received about zero rating cycle helmets for VAT purposes; and if he will make a statement.

  Sir John Cope
  My right hon. Friend has received a number of representations on this subject and these will be carefully considered in the run-up to the Budget. The hon. Member will appreciate that it would be inappropriate for me to comment further at this stage.

  EC Abatement Procedure
  Mr. Booth
  To ask the Chancellor of the Exchequer by how much the abatement procedure has reduced the United Kingdom net payments to the European Community since 1985.

  Sir John Cope
  By the end of 1992, the abatement had reduced the United Kingdom's net payments to the European Community budget by £11,843 million. The table shows the level of abatement received each year since 1985.

  £ million

  Year

  Abatement

  1985

  166

  1986

  1,701

  1987

  1,153

  1988

  1,594

  1989

  1,154

  1990

  1,697

  1991

  2,497

  1992

  1,881

  Capital Gains Tax
  Mr. Jenkin
  To ask the Chancellor of the Exchequer what was the annual yield from capital gains tax in each year since 1979–80.

  Mr. Dorrell
  The requested information is given in table 1.2 of the 1992 edition of "Inland Revenue Statistics". A revised estimate for the yield in 1992–93 will be published on Budget day in the "Financial Statement and Budget Report 1993–94".

  RPI Advisory Committee
  Mr. Burns
  To ask the Chancellor of the Exchequer when he expects to receive a report from the Retail Prices Index Advisory Committee.

  Mr. Lamont
  [pursuant to the reply, 21 January 1993, c. 344]: I have today received a supplementary report from the Retail Prices Index Advisory Committee on the

  585
  treatment in the index of council tax transitional relief. The supplementary report is being published this afternoon as Cm 2153 and copies are available in the Vote Office.

  Personal Income Tax
  Mr. Milburn
  To ask the Chancellor of the Exchequer if he will estimate the net revenue forgone in each financial year as a result of the reductions in personal income tax for higher rate taxpayers introduced by the Finance Act 1988 in the light of Government receipts since then.

  Mr. Dorrell
  [holding answer 22 February 1993]: The table shows the direct revenue costs in a full year compared with reintroduced tax rates of 45, 50, 55 and 60 per cent. The band widths for the tax rate schedule have been calculated by uprating the corresponding parts of the 1987–88 regime by movements in the retail prices index as in the statutory indexation formula. The estimates take account of the introduction of independent taxation from 1990–91 and the restriction of mortgage interest relief to the basic rate from 1991–92.

  Latest inflation1

  Budget balance2

  General government debt3

  Long-term bond yield4

  Belgium

  2.8

  -6.7

  130.6

  7.7

  Denmark

  1.5

  -2.3

  72.7

  8.7

  France

  2.0

  -2.8

  49.1

  7.8

  Germany5

  4.4

  -3.2

  47.6

  6.9

  Greece

  14.4

  -13.4

  104.0

  n.a.

  Ireland

  2.3

  -2.7

  96.4

  9.9

  Italy

  4.3

  -10.5

  105.4

  13.0

  Luxembourg

  2.6

  -0.4

  5.3

  7.7

  Netherlands

  2.5

  -3.5

  80.6

  6.8

  Portugal

  8.5

  -5.6

  66.7

  11.3

  Spain

  5.4

  -4.6

  46.6

  11.5

  United Kingdom

  1.7

  -6.1

  43.7

  7.9

  1 Latest percentage change in consumer prices on year ago.

  2 1992 general government financial balance (as a percentage of GDP), European Economy (January/February 1993).

  3 1992 gross debt of general government (as a percentage of GDP), estimates taken from European Economy (May 1992).

  4 Yield on fixed interest government securities on February 18th 1993, except Ireland (December 1992) and Portugal (November 1992).

  5 Inflation and government debt figures are for western Germany.

  Source: OECD and Eurostat.

  Public Expenditure Programme
  Mr. Campbell-Savours
  To ask the Chancellor of the Exchequer what meetings he or his departmental officials have had with representatives of the International Monetary Fund in the United Kingdom at which he or they have discussed with them the Government's public expenditure programmes.

  Mr. Nelson
  [holding answer 23 February 1993]: Under article IV of the articles of agreement of the International Monetary Fund, fund staff carry out regular surveillance of the economies of the member countries. Fund staff visited the United Kingdom on 1 to 11 December 1992 for its annual article IV consultation. This consultation covered all aspects of the Government's economic policy, including public expenditure.
  586

  Estimated change in tax revenue at rates in excess of 40 per cent.

  Year

  £ billion

  1988–89

  2.6

  1989–90

  3.2

  1990–91

  3.7

  11991–92

  3.9

  11992–93

  3.8

  1 Provisional estimates.

  The estimates do not allow for any behavioural effect that might have resulted had the tax rates above 40 per cent. been retained, and do not include capital gains tax.

  Maastricht Treaty
  Sir Trevor Skeet
  To ask the Chancellor of the Exchequer if he will update the table given in his answer of 21 January,Official Report, columns 339–40, relating to the convergence criteria of the Maastricht treaty.

  Mr. Nelson
  [holding answer 23 February 1993]: Following is the updated table as requested.

AGRICULTURE, FISHERIES AND FOOD

  Flood Prevention, Stanmore
  Mr. Dykes
  To ask the Minister of Agriculture, Fisheries and Food if he will hold urgent discussions with the National Rivers Authority and the London borough of Harrow on the need for flood prevention remedial measures to protect residents in certain areas of Stanmore, Middlesex.

  Mr. Curry
  The Ministry of Agriculture, Fisheries and Food makes grant available to the National Rivers Authority, local authorities and other bodies towards the cost of flood defence schemes which are technically sound, economically worth while and environmentally sympathetic. In the case referred to, the Ministry has indicated that any scheme put forward by the responsible local bodies will be sympathetically considered against the criteria laid down. I understand that the National Rivers Authority is working on designing a suitable scheme and is in contact with the Ministry's river and coastal engineers.

  Marine Laboratories
  Mr. Salmond
  To ask the Minister of Agriculture, Fisheries and Food (1) what consultations he has had with(a) staff, (b) the fishing industry, (c) local councils, and (d) hon. or right hon. Members regarding the possibility of conferring next steps agency status on the marine laboratory in Lowestoft; and if he will make a statement;

  (2) what consideration he has given to conferring next steps agency status on the marine laboratory in Lowestoft; and if he will make a statement;

  (3) what plans he has for the rationalisation or amalgamation of services provided by the marine laboratory facilities in Aberdeen and Lowestoft; and if he will make a statement;

  (4) what assessment has been made of the implications for organisational and departmental responsibilities of the assumption of next steps agency status by one or both of the present marine laboratory facilities in Aberdeen and Lowestoft; and if he will make a statement.

  Mr. Curry
  Staff representatives were informed last July that a study group had been established to review the merits of a move to next steps agency status for the MAFF directorate of fisheries research. My right hon. Friend is currently considering the issues raised by this review in consultation with colleagues and will report his decision to the House in the normal way.

  Salmonella
  Mr. Spring
  To ask the Minister of Agriculture, Fisheries and Food what further advice he has on salmonella in eggs; and if he will make a statement.

  Mr. Gummer
  [pursuant to his reply, 9 February 1993, c. 556–58]: 1 have today made an order revoking the Poultry Laying Flocks (Testing and Registration etc) Order 1989, as amended. Commercial egg laying flocks will no longer be required to be registered or tested for the presence of salmonella.

  I previously announced that, in the light of the expert advice from the committee chaired by Professor Heather Dick, and in accordance with the new EC zoonoses directive, the compulsory slaughter of commercial egg-laying flocks infected with salmonella enteritidis would no longer be required: this change will take effect tomorrow.

  Pea Crop
  Mr. Clifton-Brown
  To ask the Minister of Agriculture, Fisheries and Food what are the precise criteria for the derogation for this season's vining pea crop from the set-aside regime.

  Country

  Debt agreement

  Signed

  Value (£)

  Senegal

  "United Kingdom/Senegal retrospective terms agreement 1988"

  29 August 1988

  1,070,878.57

  Guyana

  "United Kingdom/Guyana debt rescheduling arrangement 1989"

  29 August 1990

  5,457,440.55

  Egypt

  "United Kingdom/Egypt retrospective terms agreement 1991"

  25 July 1991

  7,020,961.00

  Jamaica

  "United Kingdom/Jamaica debt waiver arrangement 1991"

  30 April 1992

  9,541,265.73

  Bolivia

  "United Kingdom/Bolivia retrospective terms agreement 1992"

  9 June 1992

  1,053,256.48

  Honduras

  "United Kingdom/Honduras retrospective terms agreement 1992"

  21 August 1992

  5,000,000.00

  Total

  29,143,802.33

  In addition we have agreed to write off £56 million of Zambia's aid debt with effect from 1 April 1993, provided
  588
  Mr. Curry
  Vining peas are not covered by the arable area payments scheme, which includes provision for set aside. However, there is a derogation for those who can demonstrate that they had sown, or were committed to sowing, vining peas before 17 November 1992 and who wish to claim aid on their vining peas for 1993. Any such growers will have to apply to their regional service centre or local area office for a vining pea claim form and to return it by 15 May 1993. They will have to confirm that they have sown by that date and to sign the following undertaking and provide the supporting information mentioned.

  DECLARATION ON VINING PEAS

  1. I understand that vining peas have been removed from the list of crops eligible for arable area aid. I am, however, claiming aid in 1993 for vining peas under the derogation in Commission Regulation 3738/92 which permits me to do so. I certify that prior to 17 November 1992, I was already committed to growing vining peas in the expectation of receiving area payments, because either:

  2. I had prior to that date already entered into a binding contract with a buyer or processor for vining peas which is still in force, and had therefore committed myself to setting aside land in the expectation of planting vining peas on other land and receiving aid in respect of them and could not have changed my plans on or after 17 November 1992 without suffering adverse financial consequences: I attach a copy of the contract: or

  3. Although I had not entered into a contract as referred to in (2) above, I can demonstrate that before 17 November 1992 I had made a farm plan committing myself to setting aside particular land in the expectation of planting vining peas on other land and receiving aid in respect of them and could not have changed my plans on or after 17 November 1992 without suffering adverse financial consequences. I attach a copy of the dated farm plan covering all arable crops and intended set aside land and an explanation of my claim that, had I changed my plans on or after 17 November 1992, I would have necessarily suffered adverse financial consequences.

OVERSEAS DEVELOPMENT ADMINISTRATION

  Aid Debt
  Mr. William Powell
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list each write-off of aid debt approved since 1 January 1987, with the date and sum involved.

  Mr. Lennox-Boyd
  The following aid debt agreements have been signed since 1 January 1987:

  that Zambia's economic reform programme stays on track. Aid agreements with a number of other countries were signed prior to 1 January 1987.
  589
  The forgiveness of aid debt has in recent years been only a small part of our wider initiatives through Toronto and Trinidad terms to relieve debt and debt servicing payment by developing countries.

  Thailand
  Mr. Alton
  To ask the Secretary of State for Foreign and Commonwealth Affairs how much aid per year the British Government give to Thailand, how much aid is given(a) to the Government and (b) to nongovernmental organisations; and what the aid is used for.

  Mr. Lennox-Boyd
  In the last three years for which figures are available, gross United Kingdom bilateral aid expenditure to Thailand was as follows:

  (£'000)

  1989–90

  1990–91

  1991–92

  (a) Official channels

  11,318

  9,071

  3,644

  (b) Non-governmental Organisations (NGOs)

  362

  458

  423

  11,680

  9,529

  4,067

  Multilateral aid to Thailand attributed to the United Kingdom is estimated to have been £3,320,000 in 1989, the latest available figure.

  The totals at (a) comprise assistance under the aid and trade provision, principally the supply of locomotives, funds from the Commonwealth Development Corporation—present coverage includes development finance, housing, industry and natural resources—disaster relief, drug-related aid, and technical co-operation projects focused on United Kingdom training, English language teaching, flax processing, water, sanitation and public administration.

  The aid through NGOs (b) covers a host of sectors including social and women's development, environmental conservation, income generation, education, health and agriculture, and includes work with prostitutes and street children through Christian Aid.

  Angola
  Mr. Burden
  To ask the Secretary of State for Foreign and Commonwealth Affairs what efforts are being made to supply emergency aid to Angola.

  Mr. Lennox-Boyd
  We maintain close contact with British non-governmental organisations which are assessing how best to help meet current needs. Security problems are making assessment difficult.

  Following the destruction of Luanda's water treatment works, we have contributed £45,000 to One World Action, a non-governmental organisation, which is running a community-based cholera prevention programme.

  Poland and Hungary (Assistance for Economic Restructuring)
  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will publish a list of the current application of the PHARE funds by(a)
  590
  cost, (b) purpose of each project, (c) country where funds are to be used and (d) the British firms or institutions involved.

  Mr. Lennox-Boyd
  The list of current PHARE-funded projects is extensive. EC Commission documents containing information on their cost, purpose and recipient country have been placed in the Libraries of the House. Details of the involvement of British firms and institutions are not available in the form requested.

  Kenya (Elections)
  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) how many ballot papers were supplied by the British Government for the recent Kenyan elections; and how many were necessary for meeting the legitimate voting needs of the Kenyan electorate;

  (2) for what reasons the ballot papers for the recent Kenyan elections were supplied by the British Government rather than by the European Community.

  Mr. Lennox-Boyd
  The British Government did not supply any ballot papers for the recent Kenyan elections.

  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many ballot boxes were supplied by the British Government for the recent elections in Kenya; how many were calculated as necessary for the elections; and how many were thought to be surplus to immediate requirements.

  Mr. Lennox-Boyd
  The British Government supplied 35,000 ballot boxes in accordance with the requirement for the elections calculated by the Kenyan electoral commission.

  Commonwealth of Independent States
  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will publish a list of the current application of TACIS—technical assistance for the Commonwealth of Independent States—funds by(a) cost, (b) purpose of each project, (c) destination for funds and (d) the British firms or institutions involved.

  Mr. Lennox-Boyd
  The list of current TACIS-funded projects is extensive. EC Commission documents containing information on their cost, purpose and recipient country are now available in the Libraries of the House. Details of the involvement of British firms and institutions are not available in the form requested.

  Development Banks
  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs what proportion of the capital of(a) the World bank, (b) the Latin American development bank, (c) the African development bank and (d) the Asian development bank is held by the United Kingdom; and what sum has been paid in.

  Mr. Lennox-Boyd
  The United Kingdom's present shareholdings are detailed in the table.
  591

  Bank

  Total United Kingdom shares

  Percentage of total subscribed capital

  Value (US$ million)

  Cumulative amount paid in (USS million)

  Cumulative percentage shareholding paid in

  World bank

  69,397

  5.50

  8,372

  539.5

  6.44

  Inter-American

  32,839

  0.97

  580.4

  25.2

  4.34

  Asian

  36,131

  2.24

  516.8

  62.

  11.99

  African1

  22,564

  1. 39

  225.6

  28.2

  12.58

  SDRsmn

  SDRsmn

  Notes:

  1 African Development Bank shareholdings are expressed in Bank Units of Account (BUA) which are equivalent to Special Drawing Rights (SDRs).

  NB: These figures do not include the funds the United Kingdom has contributed to the concessional lending funds of the banks.

  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs what was the level of arrears owed to(a) the World bank, (b) the Latin American

  Institution

  Arrears at end 1990 US $ million

  Arrears at end 1991 US $ million

  Arrears at end 1992 US $ million

  World Bank

  2,420

  1,937

  1,974

  Inter-American Development Bank

  704

  190

  13

  Asian Development Bank

  31

  33

  31

  African Development Bank

  1143

  1177

  1282

  1 African Development Bank Group arrears are expressed in Special Drawing Rights (SDRs).

  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs, what proportion of the funds disbursed under the auspices of the World bank's special programme for Africa originate from(a) the European Community and (b) the United Kingdom bilateral aid program.

  Mr. Lennox-Boyd
  According to information from the World bank, 7.3 per cent. of the funds disbursed under the auspices of the World bank's special programme for Africa up to June 1992 came from the European Community and 6.4 per cent. from the United Kingdom bilateral aid programme.

  pursuant to his reply to the hon. Member for Clydebank and Milngavie (Mr. Worthington), of 11 December 1992, Official Report, column 816, on access to information about the World bank, which body has made a proposal to make World bank environmental assessments more widely available; which body considered that proposal; what were the details of that proposal; when and what was the outcome; and what further initiatives he will take to pursue this proposal.

  Mr. Lennox-Boyd
  I refer the hon. Member to the reply I gave to the hon. Member for Ceredigion (Mr. Dafis) on 11 February at column 727. The bank's executive directors are expected to consider this recommendation soon.

  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs what steps are being taken to ensure that World bank staff implement fully and efficiently the decisions taken by the World bank board.

  Mr. Lennox-Boyd
  The World bank board regularly reviews the bank's performance in implementing policies and in implementing programmes in its borrowing member countries. In addition individual World bank
  592
  development bank, (c) the African development bank and (d) the Asian development bank in each of the past three years.

  Mr. Lennox-Boyd
  The information requested is detailed in the table:

  operations are subject after completion to evaluation of their effectiveness in meeting approved objectives; evaluation findings are submitted to the board.

  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list the names of each local Zambian non-governmental organisation which will be consulted on each of the World bank projects under consideration in Zambia; on what date consultation was initiated; and on what date it is due to be concluded.

  Mr. Lennox-Boyd
  We do not have the information requested.

  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he expects the World bank to conclude the review of the implementation of the Narmada dam project.

  Mr. Lennox-Boyd
  As agreed at the bank's board meeting last October, a World bank mission is due to review in April the progress made against a set of performance benchmarks agreed with the Indian authorities.

  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs what subjects will be on the agenda of the next general meeting of the World bank.

  Mr. Lennox-Boyd
  The next annual meeting of the World bank will be held in October. The agenda is not yet available.

  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs by what methods and using what criteria the United Kingdom contribution to the World bank in 1991–92 is assessed for effectiveness.

  Mr. Lennox-Boyd
  Our contributions to the World bank form part of the British aid programme and are judged against the objectives set out in the annual departmental report, Cm. 2202. The greater part of our
  593
  contributions are made to the International Development Association on the basis of the reports agreed by donors for each replenishment.

  Wappenhans Report
  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the progress of discussion concerning the Wappenhans report.

  Mr. Lennox-Boyd
  I refer the hon. Member to the reply I gave to the hon. Member for Ceredigion (Mr. Dafis) on 11 February, at column 727.

  Sardar Sarovar Project
  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs what account has been taken of human rights violations associated with the Sardar Sarovar project in considering United Kingdom involvement in funding the project.

  Mr. Lennox-Boyd
  We are well aware of reports of such incidents. Our position on the continuation of external support for the project is that we shall take into account all the relevant issues.

  International Development Association
  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs what were the conditions attached to the ninth replenishment of IDA; and what steps have been taken to ensure they were met prior to the 10th replenishment of IDA.

  Mr. Lennox-Boyd
  The report on the ninth replenishment of the International Development Association was published as Cm. 1325 in November 1990. Annual progress reports on implementation are presented to the World bank's board of directors, and were considered by IDA donors in the course of negotiations on the 10th replenishment.

  Mr. Denham
  To ask the Secretary of State for Foreign and Commonwealth Affairs what was the United Kingdom's contribution in current prices, and as a proportion of the total, to the International Development Association on its establishment and on each successive replenishment, including the proposed 10th replenishment; and what reasons there have been for changes in the proportion.

  Mr. Lennox-Boyd
  United Kingdom contributions to IDA replenishments have been:

  US dollars millions

  Share

  IDA 1

  Initial Subscription

  131.4

  17.33

  Supplementary Contribution

  96.60

  12.97

  IDA 2

  155.52

  12.96

  Special Contribution

  103.68

  12.23

  IDA 3

  311.4

  12.74

  594

  £ sterling million

  Share

  IDA 4

  206.46

  11.10

  IDA 5

  475.40

  10.60

  IDA 6

  554.97

  10.0

  Special Contribution

  105.0

  n/a

  IDA 7

  401.52

  6.70

  IDA 8

  524.16

  6.70

  IDA 9

  619.03

  6.70

  IDA 101

  620.0

  6.15

  1 Proposed contribution

  n/a =Not available.

  The United Kingdom share is affected by the number of donors and the outcome of discussions among donors on burden sharing during the replenishment negotiations.

PRIME MINISTER

  Ministers' Homes (Security)
  Mr. Hain
  To ask the Prime Minister what was the cost of work carried out at public expense at the home of the Minister of Agriculture, Fisheries and Food since 1989.

  Mr. Newton
  I have been asked to reply.

  Security work is carried out at the home of Ministers on the advice of the security authorities. Its cost is kept to the minimum necessary to provide proper protection.

  Mr. Gordon Prentice
  To ask the Prime Minister if he will list those Ministers entitled to assistance from public funds in respect of security facilities at their private homes.

  Mr. Alan Williams
  To ask the Prime Minister in how many cases since 1979 permanent accommodation for security staff has been provided at public cost for Ministers in or on property owned by Ministers.

  Mr. Newton
  I have been asked to reply.

  It is not in the public interest to disclose or aid the identification of security arrangements relating to public figures.

HOME DEPARTMENT

  Young Offenders
  Mr. Mike O'Brien
  To ask the Secretary of State for the Home Department what proposals he has to reduce the levels of those juvenile offences linked to substance abuse or drug or gambling addiction.

  Mr. Jack
  It is not possible to estimate precisely how much juvenile crime is linked with substance abuse or drug addiction, although it is known that many offenders, including juvenile offenders, may have problems with alcohol or drugs, and all action to reduce misuse may, accordingly, help to prevent crime.

  The Department of Health organises extensive publicity campaigns against the misuse of drugs and other substances. The national curriculum incorporates aspects of health education, including the dangers of drugs,

  595
  solvents and alcohol misuse. which schools are statutorily required to teach. The Home Office drugs prevention initiative, which was launched in 1989, has established 20 local drug prevention teams around Great Britain. The main purpose of the teams is to work with the community to promote the prevention of drug misuse and young people are targeted as the principal group at risk.

  Home Office research has shown that there is no evidence of any association between the playing of amusement machines, which is the only form of gambling to which juveniles have ready access, and delinquency.

  Mr. Mike O'Brien
  To ask the Secretary of State for the Home Department if he will make a statement on evidence from the Magistrates Association on the extent to which teenage offenders commit frequent crimes over a relatively short period as a result of a sudden traumatic incident in their lives; and if he will outline his proposals for dealing with such cases.

  Mr. Jack
  We have noted the contents of the evidence to which the hon. Member refers. This is currently before the Home Affairs Select Committee for consideration in its inquiry. Courts and criminal justice agencies are already able to take account of the circumstances which give rise to offending behaviour in determining the most appropriate course of action in particular cases: relevant advice on this should be included in a pre-sentence report, which is required before imposing any custodial sentence in the magistrates or youth courts, or one of the more demanding community sentences.

  Mr. Mike O'Brien
  To ask the Secretary of State for the Home Department (1) what proportion of cleared-up offences were committed by juveniles in 1979, 1981, 1985, 1991 and 1992;

  (2) what is the amount of crime for which juveniles are known to have been responsible in 1979, 1985 and 1992;

  (3) how many offences committed by juveniles were dealt with by way of caution in 1979 and 1992.

  Mr. Jack
  Although overall clear-up figures are collected centrally, it is not possible to separately identify those offences committed by juveniles.

  Information on "known offenders"—those found guilty or cautioned—by age is published annually in chapter 5 of the Command Paper "Criminal statistics England and Wales". 1992 data will not be published until the autumn. Copies of the annual publication are available in the Library.

  Table 2.21

  Notifiable offences of fraud and forgery recorded by the police by offence England and Wales

  Number of offences

  Offence

  51

  52

  53

  60

  61

  Fraud by company director etc.

  False accounting

  Other Fraud

  forgery, or use of, false drug description

  Other forgery etc.

  Total fraud and forgery

  Offences recorded

  1981

  30

  2,415

  96,065

  964

  7,197

  106,671

  1982

  24

  2,667

  111,290

  987

  8,133

  123,101

  1983

  45

  2,292

  109,615

  976

  8,863

  121,791

  1984

  71

  1,883

  112,214

  1,070

  10,855

  126,093

  1985

  37

  1,823

  120,758

  880

  11,269

  134,767

  1986

  25

  1,854

  120,923

  912

  9,717

  133,431

  1987

  43

  1,816

  119,893

  1,114

  10,110

  132,976

  Bail Offenders
  Mr. Mike O'Brien
  To ask the Secretary of State for the Home Department what percentage of offences were committed by persons on bail in(a) 1978 and (b)

  Mr. Jack
  I refer the hon. Member to the reply I gave to a question from my hon. Friend the Member for Vale of Glamorgan (Mr. Sweeney) on 22 February 1993, at column 427.

  Prison Assaults
  Mr. Steinberg
  To ask the Secretary of State for the Home Department if he will list the number of convictions of assault on(a) male prison officers and (b) female prison officers at Durham prison, Frankland prison and Low Newton centre for the past 10 years.

  Mr. Peter Lloyd
  Information about prisoners found guilty on adjudication of an assault on an officer or member of staff is available only from 1 April 1989 and is given in the table. The sex of the officer or member of staff is not recorded centrally.

  Assaults1 on a prison officer or member of staff

  Establishment2

  31989

  1990

  1991

  41992

  Male establishments

  Low Newton

  2

  5

  16

  9

  Durham

  16

  32

  43

  40

  Frankland

  24

  75

  53

  32

  Female establishments

  Low Newton

  8

  11

  9

  8

  Durham

  1

  —

  —

  —

  1 Including attempts.

  2 At which the adjudication was held.

  3 April to December.

  4 Provisional.

  Crime (Clear-up Statistics)
  Mr. Mike O'Brien
  To ask the Secretary of State for the Home Department what were the clear-up rates for crime in(a) 1979 and (b)

  Mr. Jack
  The requested information for 1979 is published in table 2.21 of "Criminal Statistics, England and Wales 1989". Information for 1992 is not yet available but information for 1991, which is the latest published figure, has just been published in table 2.11 of "Criminal Statistics, England and Wales 1991". Copies of both are available in the Library.
  597

  Offence

  51

  52

  53

  60

  61

  Fraud by company director etc.

  False accounting

  Other fraud

  Forgery, or use of, false drug prescription

  Other forgery etc.

  Total fraud and forgery

  1988

  40

  2,075

  119,645

  1,307

  10,806

  133,873

  1989

  25

  2,106

  121,756

  1,196

  9,407

  134,490

  1990

  53

  2,001

  133,866

  1,009

  10,980

  147,909

  1991

  24

  1,623

  159,136

  968

  12,991

  174,742

  Offences cleared up 1991

  Number

  20

  1,535

  84,630

  775

  10,007

  96,967

  Percentage

  1(83)

  95

  53

  80

  77

  55

  1 () Percentages in brackets are based on totals of less than 100.

  Police (Stabbings)
  Mr. Boyes
  To ask the Secretary of State for the Home Department how many police officers in each police authority area have been injured or killed by stabbing in each year since 1979.

  Mr. Jack
  Information on the number of police officers injured by stabbing is not collected centrally.

  The number of police officers who were the victims of offences currently recorded as homicide where a sharp instrument was used, including knives, by police force in England and Wales since 1979 is a follows:

  Police Force

  Year

  Number

  Wiltshire

  1979

  1

  Metropolitan

  1980

  1

  West Yorkshire

  1981

  1

  Greater Manchester

  1982

  1

  1983

  —

  1984

  —

  Kent and Metropolitan

  1985

  2

  1986

  —

  1987

  —

  Offences currently recorded as homicide involving the use of a sharp instrument, England and Wales 1982 to 1991

  1982

  1983

  1984

  1985

  1986

  1987

  1988

  1989

  1990

  1991

  MPD

  72

  44

  62

  72

  75

  70

  57

  59

  52

  73

  Cumbria

  3

  0

  0

  1

  2

  0

  0

  0

  3

  0

  Lancashire

  2

  5

  7

  5

  6

  9

  5

  5

  6

  3

  Merseyside

  5

  4

  7

  3

  9

  3

  7

  4

  6

  11

  Greater Manchester

  10

  8

  6

  6

  19

  14

  12

  8

  4

  7

  Cheshire

  1

  3

  3

  1

  1

  1

  2

  2

  3

  2

  Northumbria

  3

  3

  5

  4

  2

  5

  3

  6

  6

  5

  Durham

  0

  2

  2

  0

  2

  1

  0

  0

  3

  0

  North Yorkshire

  3

  0

  0

  1

  1

  2

  1

  4

  2

  2

  West Yorkshire

  10

  6

  6

  9

  10

  10

  7

  13

  10

  15

  South Yorkshire

  6

  10

  4

  4

  3

  4

  7

  3

  5

  8

  Humberside

  7

  2

  2

  1

  2

  3

  4

  2

  3

  2

  Cleveland

  4

  1

  3

  3

  1

  0

  3

  6

  3

  3

  West Midlands

  15

  10

  17

  18

  12

  15

  9

  10

  8

  12

  Staffordshire

  0

  2

  1

  0

  2

  2

  3

  2

  3

  3

  West Mercia

  1

  1

  1

  2

  5

  1

  1

  0

  2

  1

  Warwickshire

  1

  1

  0

  1

  0

  2

  0

  1

  0

  1

  Derbyshire

  1

  2

  1

  0

  1

  0

  2

  4

  2

  3

  Nottinghamshire

  3

  0

  6

  4

  5

  5

  1

  0

  4

  5

  Lincolnshire

  2

  0

  2

  0

  0

  2

  0

  2

  0

  2

  Leicestershire

  2

  1

  1

  4

  3

  0

  0

  1

  5

  3

  Northamptonshire

  0

  5

  3

  1

  3

  5

  4

  1

  1

  0

  Cambridgeshire

  1

  0

  1

  1

  0

  2

  2

  1

  1

  2

  Norfolk

  0

  0

  3

  0

  5

  1

  1

  1

  7

  8

  Suffolk

  2

  1

  0

  1

  0

  0

  0

  4

  2

  2

  Bedfordshire

  2

  4

  0

  1

  2

  4

  3

  2

  2

  3

  Hertfordshire

  1

  1

  5

  0

  4

  0

  7

  2

  1

  5

  Essex

  4

  1

  7

  3

  6

  3

  6

  5

  1

  7

  Thames Valley

  4

  7

  3

  7

  4

  2

  6

  7

  5

  7

  Hampshire

  3

  4

  0

  4

  5

  4

  1

  2

  6

  3

  Surrey

  0

  0

  0

  0

  0

  3

  2

  2

  1

  2

  598

  Police Force

  Year

  Number

  1988

  —

  1989

  —

  1990

  —

  Metropolitan

  1991

  2

  Mr. Boyes
  To ask the Secretary of State for the Home Department how many stabbings resulted in either maiming or death in each police authority area in each year since 1979.

  Mr. Jack
  Statistics on the proportion of offences where a sharp instrument or knife were involved were published for those forces where they were available for the years 1986 to 1989 in tables 2.23 and 2.24 of "Criminal Statistics, 1989, England and Wales", Cm. 1322, a copy of which is in the Library. The number of offences currently recorded as homicide where a sharp instrument, including a knife, was involved is shown by police force in the table. Information for the years 1979 to 1981 is not available except at disproportionate cost and information for 1992 is not yet available.
  599

  1982

  1983

  1984

  1985

  1986

  1987

  1988

  1989

  1990

  1991

  Kent

  6

  4

  9

  4

  7

  4

  6

  2

  4

  2

  Sussex

  0

  2

  4

  4

  5

  1

  2

  4

  4

  3

  Devon and Cornwall

  1

  0

  4

  2

  1

  4

  6

  1

  3

  3

  Avon and Somerset

  3

  5

  2

  3

  3

  9

  2

  2

  2

  3

  Gloucestershire

  0

  0

  1

  2

  0

  0

  1

  3

  1

  3

  Wiltshire

  2

  2

  1

  0

  2

  2

  1

  4

  1

  3

  Dorset

  1

  2

  3

  0

  4

  0

  1

  0

  1

  2

  North Wales

  4

  2

  3

  1

  0

  1

  4

  0

  0

  2

  Gwent

  3

  1

  1

  4

  1

  2

  3

  1

  0

  0

  South Wales

  2

  3

  1

  2

  7

  3

  6

  6

  11

  1

  Dyfed-Powys

  1

  1

  0

  1

  0

  2

  2

  0

  0

  1

  Total

  191

  150

  187

  180

  220

  201

  190

  182

  184

  223

  Police Forces
  Sir John Wheeler
  To ask the Secretrary of State for the Home Department if he will list the police forces in England and Wales which include more than one county administration; and if he will set out the numbers on the combined police authority, in each case, from each constituent local authority and petty sessions.

  Mr. Charles Wardle
  The following police forces in England and Wales include more than one county administration:

  Avon and Somerset, Devon and Cornwall, Hampshire, Sussex, Thames Valley, West Mercia, Dyfed Powys, North Wales and South Wales.

  The numbers on the combined police authorities are as follows:

  County

  Local Authority Members

  Magistrates

  Avon and Somerset

  Avon

  18

  9

  Somerset

  8

  4

  Devon and Cornwall

  Devon

  20

  10

  Cornwall

  9

  5

  Isles of Scilly

  1

  0

  Hampshire

  Hampshire

  20

  10

  Isle of Wight

  4

  2

  Sussex

  East Sussex

  10

  5

  West Sussex

  10

  5

  Thames Valley

  Berkshire

  10

  5

  Buckinghamshire

  8

  4

  Oxfordshire

  8

  4

  West Mercia

  Hereford and Worcester

  14

  7

  Shropshire

  8

  4

  Dyfed Powys

  Dyfed

  12

  5

  Powys

  5

  3

  North Wales

  Clwyd

  12

  8

  Gwynedd

  8

  4

  South Wales

  Mid Glamorgan

  10

  5

  South Glamorgan

  8

  4

  West Glamorgan

  8

  4

  Prisoner Statistics
  Mr. Mike O'Brien
  To ask the Secretary of State for the Home Department what was the number of prisoners in custody in each of the last six months.

  Mr. Peter Lloyd
  I would refer the hon. Member to the reply given to a question from the hon. Member for Cardiff, South and Penarth (Mr. Michael) on 12 February, at columns 811–12.

  Immigration
  Mr. Fraser
  To ask the Secretary of State for the Home Department what financial contribution is made by Her Majesty's Government to the work of the ad hoc group, immigration, including the cost of time of civil servants spent at meetings, allocations for travel costs and any other specific allocations; and on which vote the costs fall.

  Mr. Charles Wardle
  Except during the United Kingdom presidency, there have been no direct financial subventions from United Kingdom funds to the work of the ad hoc working group on immigration.

  Meetings of the ad hoc group, usually in the presidency capital, and of its subgroups, usually in Brussels, are serviced by the secretariat of the Council of the European Communities, and accommodation and so on are provided by the presidency or the secretariat respectively.

  Attendance at the preparation for meetings forms part of the normal duties of officials, most of whom are from the immigration and nationality department, their salary and so on and travelling subsistence costs form part of the overall expenditure of the Department, which is met from class IX vote 3.

  A detailed breakdown of the staff costs of all those involved in this work could be provided only at disproportionate cost.

  Animal Experiments
  Mr. Llew Smith
  To ask the Secretary of State for the Home Department what plans he has to bring forward amendments to the Animals (Scientific Procedures) Act 1986 to permit members of the Animal Procedures Committee to disclose information currently restricted.

  Mr. Charles Wardle
  The Government have no plans to amend section 24 of the Animals (Scientific Procedures) Act 1986.

  Betting Shops
  Mr. Devlin
  To ask the Secretary of State for the Home Department if she will make it her policy to extend the provisions of the Shops Act 1950 to cover betting shops, before 1 March.

  Mr. Peter Lloyd
  No, we have no plans to extend the provisions of the Shops Act 1950 to cover licensed betting offices.

  Mr. Devlin
  To ask the Secretary of State for the Home Department what proposals he has for tackling juvenile crime in Cleveland.

  Mr. Jack
  The Government have already introduced a wide range of measures which aim to prevent young people from committing crime. In Cleveland, safer cities projects in Hartlepool and Middlesbrough provide grants for a number of local initiatives aimed at tackling juvenile crime. These link, in turn, with the work being undertaken at local level by the police, probation, local authority education and social services, which is co-ordinated through an inter-agency strategy group.

  In the Criminal Justice Act 1991, implemented on 1 October 1992, Parliament strengthened the powers of the court in relation to defendants under the age of 18. The Government are presently considering additional measures to help the courts to deal more effectively with the small number of juveniles who persistently re-offend and for whom existing measures appear not to be working.

  Mr. Mike O'Brien
  To ask the Secretary of State for the Home Department what plans he has to give local authorities the power forcefully to detain juveniles remanded or serving a sentence in their care.

  Mr. Yeo
  I have been asked to reply.

  Following consultation, we are considering what further guidance may need to be given about the control and restraint of young people in residential care.

  Name of company

  Date of publication of report

  Payments to accountant inspector and support staff from his firm (£)

  Disbursements including VAT (£)

  Payments to legal inspector and legal staff (£)

  Disbursements including VAT (£)

  Westminster Property Group plc1

  28 November 1985

  —

  1,882

  —

  —

  Aldershot Football Club Ltd.

  2 July 1987

  84,602

  19,625

  16,042

  2,488

  Milbury plc

  27 October 1988

  723,736

  157,672

  221,440

  33,215

  Westminster Property Group Ltd.

  Emray plc (now Equity and General plc)2

  4 May 1988

  313,538

  9,477

  —

  —

  Greenbank Trust plc1

  4 August 1988

  —

  3,237

  —

  —

  Summer International plc (formerly Sumrie Clothes plc)

  14 October 1988

  37,925

  12,551

  7,725

  —

  Bremner plc

  7 June 1989

  58,193

  14,731

  63,443

  16,708

  County NatWest Ltd.

  20 July 1989

  770,370

  205,921

  116,437

  17,494

  County NatWest Securities Ltd.

  Consolidated Gold Fields plc

  6 September 1989

  118,522

  19,775

  10,776

  1,697

  House of Fraser Holdings plc

  7 March 1990

  1,015,992

  244,194

  218,500

  33,818

  Alexander Howden Group plc

  29 August 1990

  784,763

  187,421

  71,134

  12,382

  Minet Holdings plc (Interim)

  24 July 1986

  885,457

  227,633

  132,220

  23,110

  Minet Holdings plc

  29 August 1990

  WMD Underwriting Agencies Ltd.

  Aldermanbury Trust plc

  20 March 1991

  370,321

  58,798

  448,825

  94,913

TRADE AND INDUSTRY

  Companies House
  Mr. Austin Mitchell
  To ask the President of the Board of Trade what checks his Department makes when a company files its annual return at Companies House.

  Mr. Neil Hamilton
  This is a matter for Companies House. I have asked the chief executive to write to the hon. Member.

  Letter from David Durham to Mr. Austin Mitchell, dated 22 February 1993:
  You tabled a Parliamentary Question regarding the checks made when a company delivers its annual return to Companies House.
  My examiners carry out two types of check. First, they ensure that the company's name, registered number and registered office are consistent with the information already held.
  Secondly, they check that all the necessary details have been provided regarding company type, principal business activities, location of registers, secretary, directors, issued capital and members and that the form has been signed and dated.
  This process is simplified if the company uses a "shuttle" annual return form provided by Companies House. In this case, most of the information will be pre-printed and it would only be necessary to check additions or amendments to that information.

  Department Inspectors
  Mr. Austin Mitchell
  To ask the President of the Board of Trade if he will publish a table showing the amounts paid to each of his Department's inspectors for the reports published since 1985.

  Mr. Neil Hamilton
  The information requested by the hon. Member is as follows:
  603

  Name of company

  Date of publication of report

  Payments to accountant inspector and support staff from his firm (£)

  Disbursements including VAT (£)

  Payments to legal inspector and legal staff (£)

  Disbursements including VAT (£)

  The Animal Defence Society Ltd.

  17 April 1991

  28,705

  8,916

  15,762

  2,726

  Sound Diffusion plc

  1 May 1991

  783,478

  142,928

  53,265

  8,010

  Rotaprint plc

  24 July 1991

  580,412

  140,170

  125,105

  18,766

  The Milford Docks Company

  16 January 1992

  382,980

  92,782

  130,556

  20,212

  BOM Holdings plc

  27 February 1992

  807,244

  182,690

  168,322

  27,622

  Blue Arrow plc

  24 September 1992

  2,312,296

  572,292

  597,936

  91,864

  National Westminster Bank plc

  14 January 1993

  1,612,272

  476,880

  405,907

  71,309

  James Neill Holdings plc

  21 January 1993

  105,134

  23,308

  100,926

  21,447

  Francis Industries Ltd.

  FH Lloyd Holdings plc

  The Mersey Docks and Harbour Company

  Metal Closures Group plc

  Winchmore plc

  Edencorp Leisure plc1

  18 February 1993

  —

  14,222

  —

  —

  1 Reports by departmental officers.

  2 Departmental officer appointed with non-departmental inspector.

  3 Stockbroker (inspector) and support staff.

  Audit Companies
  Mr. Austin Mitchell
  To ask the President of the Board of Trade if he will introduce proposals under which all auditing firms carrying out the audit of a public limited company would be required to publish the profits made from its overall auditing business.

  Mr. Neil Hamilton
  No.

  Car Registrations
  Ms. Harman
  To ask the President of the Board of Trade what information he has about the number of new car registrations in each year after 1988; and if he will make a statement.

  Mr. Sainsbury
  New car registrations between 1988 and 1992 are as follows:

  Year

  1988

  2,215,574

  1989

  2,300,944

  1990

  2,008,934

  1991

  1,592,326

  1992

  1,593,601

  Highlands and Islands
  Mr. Fatchett
  To ask the President of the Board of Trade what representations his Department has made to the European Commission with regard to objective I status for the highlands and islands of Scotland; what decision he has reached about whether Merseyside should be put forward; and if he will make a statement.

  Mr. Sainsbury
  I refer to the reply I gave to my hon. Friend the Member for Falmouth and Camborne (Mr. Coe) on 17 February,Official Report, column 269.

  Cleaner Technology
  Mr. Cousins
  To ask the President of the Board of Trade if he will list the agencies represented on his liaison group on cleaner technology; how many meetings this group has had; and what new initiatives have flowed from its work.

  Mr. Eggar
  The interdepartmental liaison group on cleaner technology has representatives from Department of the Environment, Science and Engineering Research Council, Health and Safety Executive, Ministry of Agriculture, Fisheries and Food, Office of Science and Techology, and the Royal Academy of Engineering, under the chairmanship of Department of Trade and Industry. The group has now had three meetings. The group has been exchanging information on the separate initiatives that the different Departments are pursuing and the scope for co-operation between them. The Department of Trade and Industry and the Department of the Environment are working together to promote waste minimisation and energy efficiency.

  Mr. Cousins
  To ask the President of the Board of Trade whether his inquiry into United Kingdom output of, and trade in, environmental and clean technology industry has been completed; and if he will place its conclusions in the Library.

  Mr. Eggar
  Work within the DTI to identify and extract relevant data on output of, and trade in, environmental and clean technology is continuing.

  European Companies (Accounts Regulation)
  Mr. Cousins
  To ask the President of the Board of Trade whether subsidiaries of European companies are subject to home or host country accountancy regulation; and if he will make a statement.

  Mr. Neil Hamilton
  Companies incorporated in Great Britain, whether or not they are subsidiaries of companies
  605
  incorporated in other European countries, are required to prepare and file accounts in accordance with part VII of the Companies Act 1985.

  Military Equipment
  Mr. Battle
  To ask the President of the Board of Trade whether military equipment made as a result of collaboration between a British and an overseas company needs a United Kingdom export licence before it can be sold to a third country.

  Mr. Needham
  Military equipment made as a result of collaboration between a British company and an overseas company requires a United Kingdom export licence if exported from the United. Kingdom. Exports of such equipment from overseas countries are the responsibility of those countries.

  Weaving Industry
  Mr. Martlew
  To ask the President of the Board of Trade what investment has taken place in the cotton and man-made fibre weaving industry, statistical class 4322, in the last five years for which figures are available; and to what extent this investment benefited from Government grants.

  Mr. Sainsbury
  The available information for investment for standard industrial classification activity heading 4322 is given in the table.

  Investment in the cotton, man-made fibres weaving silk and industry

  £ million

  1986

  29.3

  1987

  21.7

  1988

  36.4

  1989

  36.3

  1990

  40.9

  The annual amounts of Government grants paid in support of investment in the cotton and man-made fibre weaving industry in the United Kingdom for the years 1986 to 1990 were:

  £ thousands

  1986

  920

  1987

  1,480

  1988

  469

  1989

  685

  1990

  953

  In Great Britain grants were paid under the regional selective assistance scheme and the revised regional developments grants scheme. Information about grants paid to this industry under the original regional grants scheme is available only at disproportionate cost. In Northern Ireland grants were made available from the Industrial Development Board for Northern Ireland under the Industrial Development (NI) Order 1982.

  Single Market
  Mr. Clapham
  To ask the President of the Board of Trade how many complaints were referred to the single market compliance unit in 1992; and how many were satisfactorily resolved.
  606
  Mr. Needham
  The single market compliance unit— SMCU—receives inquiries daily. At any one time the SMCU is dealing with some 30 to 40 cases. However, in practice, after detailed examination, only a minority of these, about 10 per cent. turn out to be breaches of EC law. Those not involving breaches are normally passed on to the Department's sectoral or trade divisions which are better able to assist with such inquiries.

  In 1992 the SMCU dealt with 23 new cases involving actual breaches of the EC law to add to the 16 which it was already dealing with. Typically, a case takes at least six months and sometimes over three years to resolve. This is due to the lengthy process of compiling sufficient evidence, normally with the help of British embassies, together with the time it takes to raise a complaint with a member state or the European Commission. Of the cases dealt with last year by the SMCU, nine so far have been successfully resolved.

  Mr. Clapham
  To ask the President of the Board of Trade what plans he has to expand the number of desks at the single market compliance unit; and if he will make a statement.

  Mr. Needham
  In line with my Department's new "Business in Europe" initiative, the single market compliance unit is to expand. Expressed in terms of man years, the level of resources allocated to the SMCU is to rise from 2.5 to 4.5.

  Internal Market Council
  Mr. Rowe
  To ask the President of the Board of Trade if he will make a statement on the outcome of the Internal Market Council held on 8 February.

  Mr. Needham
  I attended this first Council of the Danish presidency under the chairmanship of the new Danish Industry Minister, Mr. Troejborg. It was also the first Council for Commissioner Vanni d'Archirafi.

  The meeting had a short agenda which it completed in half a day. A review of the completion of the internal market confirmed that some 95 per cent. of the original White Paper had been agreed, with few problems reported on the free movement of goods since the 1 January deadline. An updated "league table" of implementation of White Paper measures by member states showed that the United Kingdom had risen to third position, with an 85 per cent. implementation record.

  There was general agreement on carrying forward the initiative on "Making the Single Market Work", in the light of the Commission's response to the Sutherland report. It is hoped that specific proposals on, for example, improving exchange of information between member states on single market issues will be considered by future Councils during the Danish presidency.

  The Council adopted a regulation providing for checks for product safety at the Community's external border, as well as food law directives covering fruit juices and food contaminants. The Commission was requested by the Council to introduce specific proposals for safety standards covering motor cycle helmets, in addition to the existing powers available under the personal protective equipment directive.

  One-stop Shops
  Mr. Fatchett
  To ask the President of the Board of Trade if he will make a statement on the progress on his pilot scheme for one-stop shops.

  Mr. Leigh
  [holding answer 22 February 1993]Fifty-seven partnerships have submitted bids for funding pilot one-stop shops. The bids cover a wide geographical area and many make proposals for establishing One Stop Shops in more than one local area. This is an excellent reponse and these bids are now being examined.

  I will announce the winning bids within the next two months.

  EC Development Assistance
  Mr. Fatchett
  To ask the President of the Board of Trade what representations his Department has made to the European Commission with regard to objective 1 status; and if he will make a statement.

  Mr. Sainsbury
  [holding answer 23 February 1993]I refer to the reply I gave to my hon. Friend the Member for Falmouth and Camborne (Mr. Coe) on 17 February,Official Report, column 269.

  Post Office
  Mr. Cousins
  To ask the President of the Board of Trade how many post offices and sub-post offices closed in the United Kingdom and in each region and county each year since 1988.

  Mr. Leigh
  [holding answer 22 February 1993]: The number of post offices closed in the United Kingdom in each year since 1988 is as follows:

  Year

  Number

  1988–89

  76

  1989–90

  242

  1990–91

  372

  1991–92

  303

  The majority of these closures were in rural areas where, due to the decline in the number of village shops, it has not been possible to find suitable candidates for subpostmasterships. A breakdown of this information by region or by county could be provided only at disproportionate cost.

  Mr. Cousins
  To ask the President of the Board of Trade what is his estimate of the value of the privately owned assets that form the branch service network of Post Office Counters Ltd.

  Mr. Leigh
  [holding answer 22 February 1993]: Neither the Government nor the Post Office have any records of the privately owned assets within the branch network of Post Office Counters Ltd. and have no authoritative basis on which to estimate the value of those assets.

  Mr. Cousins
  To ask the President of the Board of Trade if he will list the Government Departments and other agencies having contracts with Post Office Counters Ltd.; and what is the duration of the contract period in each case.

  Mr. Leigh
  [holding answer 22 February 1993]: The following Government Department and agencies have contracts with Post Office Counters Ltd.:
  608

  Department/Agency

  Duration of current contract (years)

  Department for National Savings

  3

  Benefits Agency

  3

  United Kingdom Passport Agency

  2

  Driver and Vehicle Licensing Agency

  3

  In addition Post Office Counters has contracts with the BBC, Girobank, Royal Mail, Parcelforce, British Telecom, British Gas, regional and Scottish electricity companies and some 100 local authorities. The duration of the current contracts with these bodies varies between six months and five years.

  Mr. Cousins
  To ask the President of the Board of Trade what was the cost of franchises for franchised post offices and the income generated from the sale of franchises.

  Mr. Leigh
  [holding answer 22 February 1993]: The cost of each franchise for franchised post offices varies with the circumstances of sale. Cumulative income from the sale of franchises to December 1992 amounted to some £5.5 million.

  Mr. Cousins
  To ask the President of the Board of Trade what was the profit or loss on Post Office Counters Ltd. in each year since the separation of its accounts; and what was the value of the direct assets of Post Office Counters in each of these years.

  Mr. Leigh
  [holding answer 22 February 1993]: The profits after taxation and net assets of Post Office Counters Ltd. in each year since the separation of its accounts were as follows:

  Year

  Profits after taxation £ million

  Net Assets £ million

  1986–87

  13.6

  455.4

  1987–88

  20.9

  493.7

  1988–89

  31.3

  517.9

  1989–90

  10.7

  1251.7

  1990–91

  22.0

  244.0

  1991–92

  16.0

  254.0

  1 As part of the introduction of return on capital employed targets, a special dividend, representing funds accumulated as a result of previous years' activities and amounting to £276.3 million, was paid to the holding company.

  Mr. Cousins
  To ask the President of the Board of Trade how many post offices and sub-post offices, showing community post offices separately, opened in the United Kingdom and in each region and county in each year since 1988.

  Mr. Leigh
  [holding answer 22 February 1993]: The number of post offices opened in the United Kingdom in each year since 1988 is as follows:

  Year

  Number

  1988–89

  35

  1989–90

  21

  1990–91

  63

  1991–92

  1157

  1 includes 74 satellite offices.

  609
  The number of community and restricted hours offices operating in rural areas at the end of each financial year was as follows:

  Community offices

  Restricted hours

  March 1989

  724

  0

  March 1990

  1,413

  23

  March 1991

  1,511

  55

  March 1992

  1,626

  90

  A breakdown of this information by region or by county could be provided only at disproportionate cost.

  Mr. Cousins
  To ask the President of the Board of Trade what was the licence fee for new sub-post offices in each year since 1989; and what income those fees generated in each year.

  Mr. Leigh
  [holding answer 22 February 1993]: For franchised offices a commercially confidential and individual franchise fee is negotiated with each agency partner. For other new or recited post offices an initial fee equivalent to 12 months' remuneration in England and nine months' remuneration in other parts of the United Kingdom is levied. All rural offices are exempted from paying such fees. Since April 1992 initial fees have no longer been levied on transfer of sub-post offices at their existing site.

  The overall yield to Post Office Counters Ltd. from franchise and initial fees has been £3.9 million in 1989–90, £9.6 million in 1990–91 and £10.5 million in 1991–92.

  Cornwall and Devon
  Mr. Tyler
  To ask the President of the Board of Trade (1) what criteria he used to substantiate the application for designation of(a) Cornwall and (b) Devon as economically deprived regions requiring objective 1 status for European Community development assistance; and what effect a separate or joint submission will have on Cornwall's chances of success;

  (2) if he will publish his submission to the European Commission seeking designation of Cornwall and Devon as economically deprived regions requiring objective 1 status for development assistance.

  Mr. Sainsbury
  [holding answer 23 February 1993]: The European Council decided at Edinburgh that the future coverage of objective I should be determined as article 8(1) of Council regulation (EEC) 2052/88. This states that objective I regions shall be regions at NUTS II level whose per capita GDP is less than 75 per cent. of the Community average. It also provides for the inclusion of Northern Ireland and, for special reasons, of other regions whose GDP figure is close to 75 per cent.

  Devon and Cornwall together form a NUTS II level region with GDP assessed as being 82 per cent. of the Community average. My right hon. Friend has written to the responsible Commissioner proposing this NUTS II region for objective 1 on the grounds of its relatively low GDP coupled with its peripherality, the effect of defence changes and declining employment in agriculture. I do not consider that it would be appropriate to publish my right hon. Friend's letter.

  Cornwall alone is classified as a NUTS III region. Its estimated per capita GDP exceeds not only 75 per cent. of the Community average, but the estimated figures of more
  610
  then 60 other NUTS III regions in the Community, which are not part of NUTS II regions, likely to be eligible for objective 1 status.

SOCIAL SECURITY

  Market Testing
  Mr. McAllion
  To ask the Secretary of State for Social Security if he will list all the market tests that have taken place in his Department since November 1991; whether the result was the maintenance of in-house provision or whether the service was contracted out; what was the name of the successful contractor where appropriate; and if he will make a statement.

  Miss Widdecombe
  Market tests for the following services have taken place:

  Travel services
  A contract for a new national travel service to this Department and the Department of Health was awarded to Wagons-Lits in January 1993.

  Facilities management and the provision of office services at Quarry House, the Department's new headquarters building in Leeds shared with Department of Health.
  There was no existing in-house provision, but in-house bids were made for office support services. The contract was awarded to Manpower UK Ltd in June 1992.

  Cleaning services for North Fylde Central Offices, Norcross, Blackpool.

  Contract awarded to Care Cleaning Services in April 1992.

  Building maintenance and works. Contracts for services previously provided by Property Services Agency (PSA) have been awarded to:

  Tarmac Construction in April 1992 and June 1992

  Henry Boot in May 1992

  Laing Management in April 1992

  The contract for services to the Fylde Benefit Directorate was won by PSA in April 1992.

  Contributions Agency's microfilming and retrievals service.

  The contract was awarded to the in-house team in February 1993.

  Mr. McAllion
  To ask the Secretary of State for Social Security how many staff in his Department are assigned to the market testing programme; how much the programme has cost his Department since November 1991; and if he will make a statement.

  Miss Widdecombe
  Currently there are some 150 staff assigned to the market-testing programme. The total cost since November 1991 has been some £1,480,000.

  Lambeth (Rent Rebates)
  Mr. Fraser
  To ask the Secretary of State for Social Security what sum was recovered from Lambeth council in respect of rent rebates in June and July 1992; and if he will make a statement.

  Mr. Burt
  Lambeth's payments on account of non-housing revenue account—HRA—rent rebate subsidy were adjusted for these months to reflect the Department's revised estimate for the 1991–92 year. The recovered amounts were offset against the authority's total payments on account. The information is in the table:
  611

  1992

  Gross payment due (£)

  Amount recovered1 (£)

  Net payment due (£)

  June

  Rent Rebates (non-HRA)

  330,750

  1,116,940

  -786,190

  Rent Allowances

  2,516,687

  0

  2,516,687

  Community Charge Benefit

  895,446

  2,752,322

  -1,856,876

  Administration

  126,379

  0

  126,379

  Total

  3,869,262

  3,869,262

  0

  July

  Rent Rebates (non-HRA)

  330,750

  1,507,869

  -1,177,119

  Rent Allowances

  2,516,687

  0

  2,516,687

  Community Charge Benefit

  895,446

  2,361,393

  -1,465,947

  Administration

  126,379

  0

  126,379

  Total

  3,869,262

  3,869,262

  0

  1 Prior year adjustments (1991–92).

  Publicity
  Mr. Morgan
  To ask the Secretary of State for Social Security, pursuant to his answer of 2 June 1992 to the hon. Member for Holborn and St. Pancras, (Mr. Dobson)Official Report, column 469, what is his Department's (a) current outturn estimate for publicity expenditure for 1992–93 and (b) budgeted publicity expenditure for 1993–94.

  Miss Widdecombe
  The Department's current estimate for publicity expenditure in 1992–93 is as follows:—

  £ million

  Headquarters DSS

  9

  Benefits Agency

  7.8

  Contributions Agency

  1.8

  Estimated publicity expenditure for 1993–94 is as follows:—

  £ million

  Headquarters DSS

  7.6

  Benefits Agency

  9.5

  Child Support Agency

  4.1

  Contributions Agency

  1.3

  Independent Living Fund
  Mr. Alfred Morris
  To ask the Secretary of State for Social Security what reply is being made to the letter sent on 4 February by the Terrence Higgins Trust to the Minister for Social Security and Disabled People in regard to the independent living fund; what action he is taking; and if he will make a statement.

  Mr. Scott
  I will be replying to the letter in due course.

  Official Entertainment
  Mr. Tony Banks
  To ask the Secretary of State for Social Security how much was spent on official entertainment in his Department during 1991–92 and 1992–93 to date.

  Mr. Scott
  Total expenditure was £91,934 in 1991–92 and £94,850 so far in 1992–93.

  Disability Allowances
  Mr. Flynn
  To ask the Secretary of State for Social Security what was(a) the total number of people in receipt of either mobility allowance or attendance allowance or both as at the end of March 1992 and (b) the total number of people in receipt of either disability living allowance or attendance allowance at the latest available date.

  Mr. Scott
  [holding answer 22 February 1993]: The information requested is estimated as follows:

  (a) 31 March 1992

  Thousands

  Benefit

  Number of recipients

  Attendance Allowance (all ages)

  1,059

  Mobility Allowance

  1685

  Both Attendance Allowance and Mobility Allowance

  2170

  Total

  1,574

  (b) Latest available date

  Thousands

  Benefit

  Number of recipients

  Attendance Allowance (over 65)

  3719

  Disability Living Allownce

  41,103

  Total

  1,822

  1 Figure excludes small number of cases already converted over to Disability Living Allowance.

  2 Figure includes small number of Attendance Allowance cases that have been suspended eg because of hospitalisation.

  3 As at 31 March 1992-the latest date for which data is available. 3

  4 All data provisional. Figures based on a 5 per cent, sample of live cases on the Disability Living Allowance system at 30 November 1992 with estimates made of both Attendance Allowance and Mobility Allowance cases awaiting conversion. It will include a small number of suspended cases.

EDUCATION

  Newall Green School, Manchester
  Mr. Alfred Morris
  To ask the Secretary of State for Education what representations he has received from the governors of Newall Green high school in Manchester in regard to key stage III assessments; what reply he is sending; what action he is taking; and if he will make a statement.

  Mr. Forth
  My right hon. Friend received a letter from the governors of Newall Green high school on 27 January. The Department gave a full reply on 22 February.

  The tests are well prepared and will go ahead. My right hon. Friend has recognised that some schools and teachers need a year to get used to the tests. He has, therefore, decided that in future test results will be included in school performance tables from the second year of their introduction nationally. This means that the secondary school performance tables will include the results of the tests in English and technology from 1994.

  Student Grants
  Mr. Byers
  To ask the Secretary of State for Education what plans he has to remove from local authority control the responsibility to allocate grants and tuition fees to students; and if he will make a statement.

  Mr. Boswell
  My right hon. Friend keeps the arrangements for administering student awards under periodic review. If he has any plans for changes, he will announce them at the appropriate time.

  Grant-maintained Schools
  Dr. Lynne Jones
  To ask the Secretary of State for Education, pursuant to his answer to the hon. Member for Vale of Glamorgan (Mr. Sweeney) of 17 February,Official Report, column 213, what criteria he will take into account in deciding whether to agree grant-maintained status to an existing indpendent school.

  Mr. Forth
  In reaching a decision, the Secretary of State will take account of a number of factors similar to those currently applied in respect of applications for new voluntary schools. These will include:

  (i) the school's ability to deliver the National Curriculum;

  (ii) the suitability of the premises;

  (iii) the need, including denominational need, for additional places in the maintained and grant-maintained sectors;

  (iv) whether the school will offer equal opportunities for girls and boys;

  (v) whether the Funding Authority supports the proposal.

  Primary Classes
  Dr. Wright
  To ask the Secretary of State for Education (1) if he will give the figures for the average size of all classes in primary schools in England for each year since 1984;

  (2) if he will give the figures for the average size of class taught by one teacher in primary schools in England for each year since 1983.

  Mr. Forth
  Information about class sizes in maintained primary schools in England for years 1983 to 1992 is given in the table.

  Average size of classes in maintained primary schools in England Position as at Janauary each year

  Year

  Classes taught by one teacher

  All classes

  1992

  26.4

  26.8

  1991

  26.3

  26.8

  1990

  25.9

  26.4

  1989

  25.7

  26.1

  1988

  25.4

  25.9

  1987

  25.4

  25.8

  1986

  25.5

  25.9

  1985

  24.9

  25.2

  1984

  24.7

  25.0

  1983

  24.8

  25.1

  Dr. Wright
  To ask the Secretary of State for Education if he will give the figures for the percentage of classes taught by one teacher with a class size of over 30 pupils in England in 1991.
  614
  Mr. Forth
  The percentages of classes with more than 30 pupils being taught by one teacher in maintained primary and secondary schools in England in January 1991 were 20 per cent. and 4 per cent. respectively.

  Education Authority Budgets
  Mr. Jopling
  To ask the Secretary of State for Education if he will list all education authorities for which he is responsible in order, expressing the percentage of their budget which is not distributed to schools and held back for central administration.

  Mr. Forth
  I refer my right hon. Friend to the reply that I gave to my hon. Friend the Member for Billericay (Mrs. Gorman) on 19 October 1992,Official Report, columns 8–12.

  Schools Statistics
  Mrs. Dunwoody
  To ask the Secretary of State for Education what is the percentage in schools of(a) governors, (b) administrators, (c) inspectors and (d) teachers who are of ethnic minority origins.

  Mr. Forth
  A survey carried out by the National Foundation for Educational Research in 1990 found that just over 1 per cent. of governors were from ethnic minority groups.

  Information on the ethnic origins of administrators and inspectors is not centrally available.

  The Government introduced ethnic monitoring of teachers in January 1990 following recommendations by the Swann committee, but response so far has been poor, although it is improving. As a result it is not yet possible to draw conclusions about the percentage of teachers nationally who are from ethnic minorities.

  "Choice and Diversity"
  Mr. Simon Hughes
  To ask the Secretary of State for Education on how many occasions he has met Church representatives on matters referred to in the Government White Paper "Choice and Diversity" since its publication; and on what dates.

  Mr. Forth
  My right hon. Friend met the president of the Methodist Conference on 5 November 1992 and the Bishop of Guildford, chairman of the General Synod board of education, on 9 February to discuss the Government's proposals, set out in the White Paper and embodied in the Education Bill currently before Parliament. He is also scheduled to meet the Churches' Joint Education Policy Committee on 8 March. This is in addition to meetings between my right hon. and noble Friend the Minister of State and representatives of the churches and meetings of the churches with my officials.

  English Tests
  Mr. Godsiff
  To ask the Secretary of State for Education how many pupils of key stage 3 age were involved in the pilot studies conducted by the University of Cambridge Local Examinations Syndicate for key stage 3 English on which the proposed tests for 1993 are based.

  Mr. Forth
  The University of Cambridge Local Examinations Syndicate conducted pilot tests in November 1992 and January this year. Three thousand pupils were involved in the first pilot and 2,700 in the second.

NORTHERN IRELAND

  Training
  Ms. Short
  To ask the Secretary of State for Northern Ireland how many people were participating in(a) Action for Community Employment, (b) the youth training programme, (c) the job training programme, (d) the enterprise allowance scheme, (e) job clubs and (f) Restart courses, at the latest available date and in each year since 1990; and if he will make a statement.

  Mr. Atkins
  Restart courses were discontinued in Northern Ireland in March 1989. Otherwise the information is as follows:

  1990–91

  1991–92

  1992–932

  Action for Community Employment

  10,073

  10,072

  9,660

  Youth training programme

  12,914

  15,480

  14,079

  Job training programme

  3,000

  3,840

  4,398

  Job clubs

  1,427

  1,933

  1,675

  Enterprise allowance scheme

  818

  537

  1—

  1 Since 1 April 1992 the enterprise allowance scheme has been replaced by the business start programme which is an amalgamation of the enterprise allowance and the Local Enterprise Development Unit's enterprise grant scheme.

  2 April to January.

  Newry and Armagh
  Mr. Mallon
  To ask the Secretary of State for Northern Ireland what was the total population in each ward within the constituency of Newry and Armagh.

  Mr. Hanley
  The most recent estimates of the total resident population in each of the local government wards covered by the Newry and Armagh constituency are set out in the table. The information is taken from the "Summary Report of the Northern Ireland Census 1991", a copy of which is in the Library.

  Ward

  Usually resident population

  District of Armagh

  Abbey Park

  2,389

  Ballymartin

  2,039

  Callan Bridge

  2,377

  Carrigatuke

  2,150

  Charlemont

  2,184

  Demesne

  2,737

  Derrynoose

  2,010

  Downs

  2,260

  Hamiltonsbawn

  2,504

  Hockley

  2,395

  Keady

  2,405

  Killeen

  2,539

  Killylea

  2,260

  Laurelvale

  2,537

  Loughgall

  2,301

  Markethill

  2,257

  Milford

  2,328

  Observatory

  2,570

  Poyntz Pass

  2,028

  Rich Hill

  3,005

  Tandragee

  2,503

  The Mall

  2,039

  District of Newry and Mourne

  Ballybot

  2,041

  Bessbrook

  2,888

  616

  Ward

  Usually resident population

  Camlough

  2,508

  Creggan

  2,464

  Crossmaglen

  2,423

  Daisy Hill

  2,876

  Derrymore

  2,948

  Drumalane

  3,450

  Drumgullion

  3,028

  Fathom

  2,868

  Forkhill

  2,578

  Newtownhamilton

  2,322

  St. Mary's

  2,772

  St. Patrick's

  2,534

  Silver Bridge

  2,607

  Tullyhappy

  2,120

  Windsor Hill

  3,341

  Total

  97,585

  Further Education
  Mr. Mallon
  To ask the Secretary of State for Northern Ireland what is the total number of(a) full-time and (b) part-time students at each third-level education facility in Northern Ireland.

  Mr. Hanley
  The information requested is as follows:

  Full-time

  Part-time

  Total

  Universities1

  Queen's University

  9,880

  2,623

  12,503

  University of Ulster

  10,972

  5,221

  16,193

  Colleges of Education1

  St. Mary's

  698

  —

  698

  Stranmillis

  689

  —

  689

  Further Education Colleges2

  Belfast Institute of Further and Higher Education

  3,959

  17,509

  21,468

  North-West College

  2,063

  3,846

  5,909

  Fermanagh

  811

  1,971

  2,782

  Limavady

  556

  880

  1,436

  Omagh

  923

  1,208

  2,131

  Antrim

  379

  1,522

  1,901

  Ballymena

  1,131

  2,592

  3,723

  Newtownabbey

  786

  2,780

  3,566

  New Technical Ballymoney

  308

  1,075

  1,383

  Coleraine

  671

  1,193

  1,864

  Magherafelt

  514

  797

  1,311

  Larne

  303

  898

  1,201

  Northern Ireland Hotel and Catering College

  223

  69

  292

  Lisburn

  757

  2,473

  3,230

  Down

  880

  2,081

  2,961

  Newcastle

  368

  742

  1,110

  Castlereagh

  693

  2,429

  3,122

  North Down

  1,218

  4,654

  5,872

  Lurgan

  528

  1,033

  1,561

  Portadown

  876

  2,120

  2,996

  Armagh

  1,002

  1,048

  2,050

  Banbridge

  337

  1,159

  1,496

  East Tyrone

  867

  1,558

  2,425

  Newry/Kilkeel

  1,284

  2,947

  4,231

  1 Provisional 1992–93 figures.

  2 1991–92 figures (latest available). Of the 21,437 full-time and 58,584 part-time students at Institutions of Further Education, 951 are following full-time higher education courses and 3,144 are following part-time higher education courses.

  Births
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland how many babies were born at each of the hospitals in Londonderry, Omagh, Dungannon, Enniskillen, Armagh, Newry and Craigavon in 1992; and how many of the mothers at each hospital were domiciled in the Republic of Ireland.

  Mr. Hanley
  The information is not available in the exact form requested. The table shows the number of live and still births at hospitals in Londonderry, Omagh, Dungannon, Enniskillen, Newry and Craigavon for the financial year 1991–92. The number of mothers at each hospital domiciled in the Republic of Ireland is shown in brackets. Armagh community hospital provides obstetric out-patient clinics only.

  Hospital

  Live

  Still

  Total

  Craigavon Area (Craigavon)

  2,287 (12)

  12 (0)

  2,299 (12)

  Daisy Hill (Newry)

  1,668 (5)

  7 (0)

  1,675 (5)

  South Tyrone (Dungannon)

  895 (1)

  3 (0)

  898 (1)

  Grants Office

  Received

  Refused

  Under consideration

  Approved

  Withdrawn

  North East Region

  Ballymena

  477

  46

  431

  —

  —

  Ballyclare

  627

  149

  476

  —

  2

  Coleraine

  271

  38

  217

  —

  16

  West Region

  Omagh

  6S3

  22

  592

  —

  39

  Fermanagh

  628

  44

  581

  —

  3

  Derry

  1,078

  29

  1,024

  —

  25

  South Region

  Craigavon

  712

  68

  641

  —

  3

  Newry

  799

  98

  701

  —

  —

  South East Region

  Lisburn

  670

  72

  596

  2

  —

  Newtownards

  793

  33

  741

  —

  19

  Belfast Region

  Belfast District 1

  645

  100

  528

  —

  17

  Belfast District 2

  855

  24

  810

  —

  21

  Belfast District 3

  875

  19

  837

  —

  19

  Total

  9,083

  742

  8,175

  2

  164

  The executive is giving priority to dealing with the backing of cases received prior to the introduction of the new scheme on 1 October 1992. This must be cleared by the end of March.

  Mr. Mallon
  To ask the Secretary of State for Northern Ireland (1) if he will give details of the formulae employed as part of the income assessment of Northern Ireland Housing Executive grant applicants;

  (2) if he will give details of the income levels which are acceptable to the Northern Ireland Housing Executive for grant purposes.

  Mr. Atkins
  If a grant applicant and all other relevant persons are in receipt of income support, full grant up to the cost of the approved works is payable.

  In all other cases, a test of resources is applied to determine how much, if anything, an applicant and other relevant persons may have to contribute towards the cost of the approved works. The balance of the costs will be met by grant.
  618

  Hospital

  Live

  Still

  Total

  Altnagelvin (Londonderry)

  2,846 (50)

  11 (0)

  2,857 (50)

  Erne (Enniskillen)

  732 (4)

  4 (0)

  736 (4)

  Tyrone County (Omagh)

  970 (0)

  4(0)

  974 (0)

  Housing Grants
  Mr. Mallon
  To ask the Secretary of State for Northern Ireland how many grant applications were received in each Northern Ireland Housing Executive grants office since the commencement of the provision in the Housing Order 1992; and how many applications were (i) approved, (ii) refused and (iii) under consideration.

  Mr. Atkins
  This is a matter for the Northern Ireland Housing Executive, but the chief executive has advised me that the information requested is as follows:—

  The test sets income and capital returns against appropriate allowances. Any resultant excess of income over allowances is translated into a borrowing power, to determine the amount which individual grant applicants are deemed to be able to contribute towards the cost of the works. The treatment of income and capital, the various allowances and the formula for arriving at the borrowing power, are contained in the House Renovation etc. Grants (Reduction of Grant) Regulations (Northern Ireland) 1992—statutory rule 1992 No. 412—copies of which are available in the House of Commons Library. There is no income bar on applications for housing grant.

  Housing Waiting Lists
  Mr. Mallon
  To ask the Secretary of State for Northern Ireland what is the average waiting period for a housing applicant in the Al priority category in each district office of the Northern Ireland Housing Executive; and what were the comaprable waiting periods for each of the past five years.
  619
  Mr. Atkins
  This is a matter for the Northern Ireland Housing Executive. I am advised by the chief executive that the information could be obtained only at disproportionate cost.

  Mortgage Repossessions
  Mr. Mallon
  To ask the Secretary of State for Northern Ireland how many orders for mortgage repossessions have occurred in each constituency in Northern Ireland in the past 12 months.

  Mr. Atkins
  Statistics show that in Northern Ireland as a whole 633 orders to repossess both domestic and commercial mortgaged properties were issued in 1992, compared with 832 in 1991.

  A breakdown by constituency is not available

DUCHY OF LANCASTER

  Quangos
  Mr. Tony Banks
  To ask the Chancellor of the Duchy of Lancaster, pursuant to his oral reply of 15 February,Official Report, column 15, if he will list the 800 quangos abolished by the Government.

  Mr. Waldegrave
  The figure 800 refers to the difference between the number of non-departmental public bodies in 1979–2,167 and 1992–1,412. It does not correspond to a single list of abolished bodies because there have been both creations and abolitions throughout the period. Further information is given in "Public Bodies", published annually since 1982 and available in the Library of the House.

  Research and Development
  Mr. Cousins
  To ask the Chancellor of the Duchy of Lancaster, pursuant to his answer of 18 February,Official Report, columns 300–4, about the framework research development programmes, what were the values in pounds sterling of the payments shown in tables B and C at the time the payments were made.

  Mr. Waldegrave
  The information given in table B in my answer of 18 February,Official Report, columns 300–4, is the breakdown of expenditure for the third framework programme covering the period 1990–94. The amounts deemed necessary for the specific areas were agreed in April 1990. The supplementary funding was agreed in December 1992. Table 1 sets out the sums for the programme as it was initially adopted in April 1990 in pounds sterling at the rate of exchange prevailing at that time—£1 = 1.351 ecu—and for the supplementary funding at the exchange rate prevailing in December 1992—£1 = 1.253 ecu. The drawing down of these sums will take place over a period extending beyond 1994.

  The information on payments made to date under the third framework programme was shown in table D of my previous answer. These payments took place between October and December 1991 and table 2 shows their value in pounds sterling based on the average rate of exchange over that period—£1 = 1.413 ecu.

  Table C of my answer of 18 February contains information on thousands of contracts let at different times during the period 1987–1991. Information on
  620
  payments in pounds sterling, at the time each specific payment was made, would be obtainable only at disproportionate cost.

  Table 1

  Third framework programme of Community activities on research and development (1990–94)

  Breakdown of the amount deemed necessary between the various activities

  Framework programme agreed April 1990 1£million

  Breakdown of supplement agreed December 1992 2£ million

  Information technology

  1,000.7

  143.7

  Communication technology

  362.0

  51 9

  Telematics

  281.3

  39.9

  Industrial and materials

  553.7

  79.8

  Measurement and testing

  103.6

  15.2

  Environment

  306.4

  43.9

  Marine sciences and technology

  77.0

  11.2

  Biotechnology

  121.4

  17.6

  Agri and agro-industrial

  246.5

  35.1

  Biomedicine and health

  98.4

  14.4

  Life sciences for development

  82.2

  12.0

  Non-nuclear energies

  116.2

  347.9

  Nuclear fission

  147.3

  23.1

  Fusion

  339.0

  87.8

  Human capital and mobility

  383.4

  55.1

  Total

  4,219.0

  3718.5

  1 £1 = 1 351 ecu.

  2 £1 = 1 253 ecu.

  3 £39.9 million in reserve with priority for non-nuclear energy.

  Table 2

  Payments under the third framework programme for European Community research and development (1990–94)

  Programme

  Germany £ million

  United Kingdom £ million

  Total EC funding £ million

  Communication technologies

  5.862

  5.206

  30.323

  Telematics

  2.281

  3.292

  18.250

  Environment

  .854

  .204

  1.449

  Total (nearest 50,000)

  9.00

  8.70

  50.02

  Note: exchange rate: £1=1.413 ecu.

  Consultants
  Ms. Mowlam
  To ask the Chancellor of the Duchy of Lancaster how many contracts for consultancies were awarded by his Department over(a) the last 12 months and (b) 1991–92.

  Mr. Waldegrave
  The number of consultancy contracts awarded by the Office of Public Service and Science and its agencies(a) in the last 12 months, 1 February 1992 to 31 January 1993, and (b) in the financial year 1991–92 are as follows:

  (a) 358

  (b) 272.

  Ms. Mowlam
  To ask the Chancellor of the Duchy of Lancaster if he will list the contracts awarded by his Department to(a) Coopers and Lybrand management consultants, (b) Touche Ross management consultants, (c) Price Waterhouse management consultants, (d) Ernst and Young management consultants, (e) Chrichton

  621
  Roberts Ltd, (f) KPMG management consultants and (g) Leopold Joseph management consultants, with the total cost of the contracts with each contractor, for (i) the past 12 months and (ii) 1991–92.

  Mr. Waldegrave
  The information on total costs of contracts awarded by my Department, including its agencies, HMSO and COI to the management consultants listed is as follows:

  (a) Coopers and Lybrand

  Past 12 months (total cost £177,039)—

  Supercomputing

  COI Customer feedback system

  Consultancy extension for Strategic Assignments

  Consultancy Service

  Chartermark Marking Framework

  1991–92 (Total cost nil)—

  No Contracts

  (b) Touche-Ross

  Past 12 months (Total cost £125,335)—

  Review of Financial Information Systems

  Market Testing Catering at the London Centre

  Sunningdale Park Facilities Management Contract

  Strategy

  2 Financial Management Information System (CCTA) Consultancy Support: Full Study (Two contracts)

  Developing an in-house bid strategy for Market

  Testing Information Systems/Information

  Technology

  Case and the Issues for Management—Quality

  Assurance

  2 Financial Management Information System (CCTA) Acceptance Testing

  Market Testing experiences

  Managing Information Systems Provision

  1991–92 (Total cost £80,605)—

  2 Financial Management Information system (CCTA) Acceptance Testing (Two contracts) Specification for GEMINI Standard Notation

  2 Financial Management Information System (CCTA) Consultancy: Full Study

  (c) Price Waterhouse

  Past 12 months (Total cost £444,711)—

  Objective Setting in Personal Review

  Charterline

  Bristol Warehouse Market Testing

  1991–92 (Total cost1)—

  Core Performance Profiles Grades 5–7

  (d) Ernst and Young

  Past 12 months (Total cost £546,272)—

  2 FMS on Purchasing at AFRC

  COI Framework Study

  Review 3 years performance as an Executive Agency

  Review of Purchasing Practices

  Study of Electronic Funds Transfer

  OPSS Business Unit

  Market Testing Workshops; Case for Speakers

  Developing an in-house bid strategy for Market Testing Information Systems/Information Technology

  622

  Development of Generic Guidance for Market

  Testing (two contracts)

  Information Technology Infrastructure Library—

  Information Technology services organisation module improvement/development

  2Appraisal and evaluation library development of exec. information systems volume

  Managing Information Systems Provision

  1991–92 (Total cost £413,650)—

  1 FMS on Purchasing at AFRC

  Market Testing

  Report on International data on Science and Technology

  1 Appraisal and Evaluation library development of executive Information Systems Volume

  Prioritisation of Information Systems—Tool Support

  GEMINI handbook Technical edition

  Validation Technical Framework Activity Model

  Replacement Consultants in Strategic Assignments Consultancy Service

  Consultancy Support for Government Data Network/CSS

  Information Technology Infrastructure Library

  Information Technology Services Organisation Module

  (e) Chrichton Roberts Ltd.

  Past 12 months (Total cost nil)—

  No Contracts

  1991–92 (Total cost nil)—

  No Contracts

  (f) KPMG

  Past 12 months (Total cost f116,804)—

  FMS on costing of Research Council contracts with OGDs

  Future Financial Options for the College

  1 Infrastructure Management Scoping Study

  1Business Transformation Scoping Study

  Speaker for Managing Change Workshop

  1991–92 (total cost £201,495)—

  Information Systems Strategy Study

  Distributed Information Technology Infrastructure Scoping Study

  1Infrastructure Management Scoping Study

  1Business Transformation Scoping Study

  Management Consultancy Support for Telecommunications Division

  Report on International Data on Science and Technology

  Standards in Competence Frameworks

  A Management Matters Survey

  (g) Leopold Joseph

  Past 12 months (total cost nil)—

  No contracts

  1991–92 (Total cost nil)—

  No contracts

  1The cost of single contracts is commercial in confidence.

  2These contracts were awarded in either February or March 1992 and therefore are included under both the past 12 months and 1991–92.

  Publicity
  Mr. Morgan
  To ask the Chancellor of the Duchy of Lancaster, pursuant to his answer of 2 June 1992 to the hon. Member for Holborn and St. Pancras (Mr. Dobson),
  623
  Official Report, column 419, what is his Office's (a) current outturn estimate for publicity expenditure for 1992–93 and (b) budgeted publicity expenditure for 1993–94.

  Mr. Waldegrave
  The Duchy of Lancaster's expenditure on advertising for qualifying beneficiaries in connection with the administration of intestacies in the duchy area for the year ending 30 September 1992 was £25,676–89. Estimated expenditure for 1993 is £24,500 and for 1994 is £25,000.

  Estimated expenditure on advertising for the recruitment of magistrates in the duchy area for 1993 is £2,500.

WALES

  Public Bodies
  Mr. Dafis
  To ask the Secretary of State for Wales if he will specify the cost of administering all non-departmental public bodies broken down by(a) executive bodies, (b) advisory bodies, (c) tribunals and (d) national health service bodies for which his Department has responsibility in Wales, during each of the last three years.

  Mr. David Hunt
  Expenditure directly incurred by the Welsh Office on administering its executive and advisory non-departmental public bodies and tribunals for the relevant years is shown in the annual publication, "Public Bodies" for 1990, 1991 and 1992. Copies are available in the Library of the House. Comparable figures in respect of national health service bodies are not readily available, and I will write to the hon. Gentleman shortly.

  Mr. Llwyd
  To ask the Secretary of State for Wales if he will make it his policy to instruct all non-departmental public bodies operational in Wales to(a) consult community and town councils in Wales regarding finance for schemes affecting their communities and (b) provide reasons in writing to community and town councils when their representations to such bodies are not accepted.

  Mr. David Hunt
  No. This is a matter for the bodies themselves.

  Consultants
  Ms. Mowlam
  To ask the Secretary of State for Wales if he will list the contracts awarded by his Department to(a) Coopers and Lybrand management consultants, (b) Touche Ross management consultants, (c) Price Waterhouse management consultants, (d) Ernst and Young management consultants, (e) Chrichton Roberts Ltd., (f) KPMG management consultants and (g) Leopold Joseph management consultants, with the total cost of the contracts with each contractor, for (i) the past 12 months and (ii) 1991–92.

  Mr. David Hunt
  The Welsh Office has awarded contracts to five of the firms mentioned. These are as follows:

  i. OVER THE PAST 12 MONTHS

  Coopers and Lybrand Management Consultants

  Assistance with the preparation of the market testing programme.

  Touche Ross Management Consultants

  Evaluation of the Teamcare Valleys project.

  624

  Investment appraisal: cancer treatment services in North Wales.

  Financial modelling of local government reorganisation.

  Welsh Office Internal Audit: assistance with market test.

  Review of the transfer of regional oral plastic and maxillo facial surgery services.

  Option appraisal: acquisition of property for the Health Promotion Authority for Wales.

  Price Waterhouse Management Consultants

  Assistance with 1992–93 Market testing programme.

  KPMG Management Consultants

  Innovation Network Wales: assessment of innovation encouragement in Wales.

  Adequacy and accuracy of agent authority (roads) accounts.

  Study into the future of the Welsh Office's in-house computer bureau.

  Advice on commercial, legal and financial issues arising from the establishment of local authority waste disposal companies.

  Appraisal of applications for NHS Trust status in 1993.

  ii. 1991–92

  Coopers and Lybrand Management Consultants

  Review of local management of schools in Wales.

  Assistance with the preparation of the market testing programme.

  Health Intelligence Unit: preparation of business plan.

  Touche Ross Management Consultants

  Survey of financial control and management arrange-ments in further and higher education establishments.

  Feasibility study into a school of public health.

  Option appraisal: cardiac services in South Wales.

  Breast Test Wales: preparation of business procurement plans.

  Ernst and Young Management Consultants

  End-year procedures for the Department's AS400 computer system.

  KPMG Management Consultants

  New product development study.

  Details of costs cannot be disclosed for reasons of commercial confidentiality.

  South Wales Valleys (Development)
  Mr. Dafis
  To ask the Secretary of State for Wales if he will make it his policy to initiate a community development strategy for the south Wales valley areas.

  Mr. David Hunt
  I will be announcing my intentions shortly on what will succeed the programme for the valleys. Community development will continue to play an important part in my proposals.

  Social Care Planning
  Mr. Dafis
  To ask the Secretary of State for Wales if he will amend the guidance notes for social care planning to secure that specific forums are established by local authorities to examine local housing demands.

  Mr. Gwilym Jones
  I have no plans to do so.

  Bed-and-Breakfast Accommodation
  Mr. Dafis
  To ask the Secretary of State for Wales how many people are currently accommodated in bed-andbreakfast accommodation in each rural local authority area in Wales.
  625
  Mr. Gwilym Jones
  The information is not available centrally.

  University Hospital of Wales (Catering)
  Mr. Morgan
  To ask the Secretary of State for Wales if he will make a statement on the state of the proceedings relating to the South Glamorgan health authority catering contract at the University hospital of Wales.

  Mr. Gwilym Jones
  The application for leave to apply for judicial review is the subject of continuing correspondence between the solicitors for the applicants and the Treasury Solicitors Department acting for the Secretary of State and the South Glamorgan health authority.

  Business Rate
  Mr. Llwyd
  To ask the Secretary of State for Wales if he will make it his policy to adjust the poundage rates applied to the uniform business rate in Wales in line with the poundage levels set for England.

  Mr. Gwilym Jones
  No. The poundage for Wales and England were set in 1990 at a level which ensured that the overall yield from non-domestic ratepayers remained at the 1989–90 level in real terms. The Welsh poundage was set at a higher rate than the English poundage in 1990 because of lower rateable values in Wales. Since 1990, the poundages in Wales and England have been uprated each year in line with the annual increase in the retail prices index as at September of the preceding year.

  The loss of revenue consequent on a real-terms reduction in the Welsh poundage would have to be met from either increased revenue support grant or by the imposition of higher council tax bills on the people of Wales.

  Social Care Plans
  Mr. Dafis
  To ask the Secretary of State for Wales if he will make it his policy to issue guidelines to local authorities on the involvement of housing providers in the formulation of social care plans.

  Mr. Gwilym Jones
  Appropriate guidance has been issued, notably as regards the preparation of housing strategies and operational plans.

  Environmental Protection
  Mr. Llew Smith
  To ask the Secretary of State for Wales if he will publish further cost details of the commitments and actions on the environment listed at figure 7.02 of his Department's annual report, 1993, Cm 221.

  Mr. David Hunt
  Cost details of most of these commitments and actions were set out within the publication "The Environment in Wales: Second Report", and further details have recently been given in the various relevant chapters of the departmental report for 1993–94 to 1995–96. It is not yet possible to attribute specific costs to the remainder of the commitments and actions.

  Reservoirs
  Mr. Dafis
  To ask the Secretary of State for Wales what plans he has to make adaptations to drinking water reservoirs in Wales to enable them to be connected into dual-purpose hydro-generators.
  626
  Mr. Gwilym Jones
  This is a matter for the commercial judgment and decision of the relevant water companies.

  European Environmental Agency
  Mr. Dafis
  To ask the Secretary of State for Wales if he will make representations to the European Community to advocate Wales as a possible location for the new European Environmental Agency.

  Mr. David Hunt
  Cambridge was chosen as the United Kingdom bid for the location of the new European Environmental Agency in 1990, after a long consultation process. There are no plans to reconsider this decision.

  Manufacturing Jobs
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Wales how many skilled or semi-skilled jobs have been lost in the manufacturing sector in each local authority area in Wales in each of the last two years.

  Mr. David Hunt
  The information is not available.

  Truancy
  Mr. Barry Jones
  To ask the Secretary of State for Wales what is the absence rate in each of the local education authorities in Wales in the secondary section; what measures he proposes to reduce these rates; and if he will make a statement.

  Sir Wyn Roberts
  Although information about absence rates is not collected centrally, details of attendance rates can be found in table 1.09 of "Statistics of Education and Training in Wales: Schools No. 1 1993", a copy of which is in the Library of the House. It is our intention for details of absence rates on an individual school basis to be published and we will shortly be issuing a consultation paper which addresses this issue amongst others.

  It is, however, for local education authorities to ensure that parents are fulfilling their statutory obligations as to their children's education.

  Training
  Mr. Tony Lloyd
  To ask the Secretary of State for Wales if he will give, in 1992–93 prices and cash terms, the total amount spent of the budget for training for Wales in each year since 1989–90, the expected outturn in 1992–93 and plans for 1993–94.

  Sir Wyn Roberts
  The information requested is given in the following table:

  Wales training expenditure in cash and real terms (1992–93 prices) 1989–90 to 1991–92 and expected outturns in 1992–93 and plans for 1993–94

  £millions

  1989–90

  Cash

  148.406

  Real terms

  178.607

  1990–91

  Cash

  146.132

  Real terms

  162.869

  1991–92

  Cash

  145.773

  Real terms

  151.968

  627

  £millions

  1992–93

  Estimated outturn

  150.095

  1993–94

  Cash

  146.700

  Real terms

  150.734

  Local Government
  Mr. Ron Davies
  To ask the Secretary of State for Wales if he will place in the Library the latest conclusions of the sub-group on internal management submitted to the Welsh Consultative Council on local government reform.

  Mr. David Hunt
  [pursuant to his reply, 4 February 1993, column 337]: The final report of the internal management sub-group has now been considered by the Welsh Consultative Council on Local Government. I have placed a copy of this report in the Library of the House.

  Assisted Areas
  Mr. Dafis
  To ask the Secretary of State for Wales when he expects to publish the results of his review of regional assisted areas in Wales.

  Mr. David Hunt
  The representations received about the review of assisted areas are currently being considered. The Government hope to be able to make an announcement on the result of the review as soon as possible, taking into account the outcome of the coal review and subject to receiving European Commission clearance.

ENVIRONMENT

  Compulsory Competitive Tendering
  Mr. Butler
  To ask the Secretary of State for the Environment what progress has been made in putting out local services to compulsory competitive tendering.

  Mr. Robin Squire
  A wide range of local authority services are subject to CCT, including highway and building construction and maintenance, refuse collection, street sweeping, grounds maintenance, and catering. Last November my right hon. Friend the Secretary of State announced the extension of CCT to a further range of local authority professional and corporate services.

  Mr. Waterson
  To ask the Secretary of State for the Environment if he will make a statement on the development of compulsory competitive tendering on housing management.

  Sir Paul Beresford
  To ask the Secretary of State for the Environment if he will make a statement on the development of compulsory competitive tendering on housing management.

  Sir George Young
  The Housing and Urban Development Bill contains provisions which pave the way for the introduction of compulsory competitive tendering to local authority housing management. It is anticipated that regulations governing the detailed operation and implementation of local authority housing management CCT will be introduced later this year.
  628
  Mr. Barry Field
  To ask the Secretary of State for the Environment if he will take steps to ensure that all local authorities apply compulsory competitive tendering with equal rigour; and which county councils are in the bottom quartile of performance in this area.

  Mr. Robin Squire
  I refer my hon. Friend to the answer I gave my hon. Friend the Member for Vale of Glamorgan (Mr. Sweeney) earlier today.

  Urban Programme
  Mr. Mandelson
  To ask the Secretary of State for the Environment if he will make a further statement on the effects of the abolition of the urban programme on his inner-city strategy.

  Mr. Howard
  I refer the hon. Member to the answer I gave to the Member for Bristol, East (Ms. Corston) earlier today.

  Mr. Mudie
  To ask the Secretary of State for the Environment what representations he has received from the Leeds area on the effects of the abolition of the urban programme on his inner-city strategy.

  Mr. Howard
  The urban programme has not been abolished. There will be a substantial programme in 1993–94 amounting to £176 million, which will enable us to honour in full existing commitments and provide £20 million for urban partnership fund projects as part of the new capital partnership programme. Planned resources for my Department's urban group of programmes for 1993–94 will increase by over £90 million; total spending will be over £1 billion.

  Mineral Planning
  Mr. Jack Thompson
  To ask the Secretary of State for the Environment if he will make a statement about the outcome of the consultations relating to the mineral planning guidance note 3.

  Mr. Baldry
  I announced on 15 July 1992 the Government's intention to revise the current planning guidelines on opencast coal which are contained in minerals planning guidance note 3. Draft revised guidance will be issued for public consultation as soon as possible following the outcome of the coal review.

  Eco-labelling
  Mr. Bennett
  To ask the Secretary of State for the Environment when he expects the first EC eco-labels to be issued in the United Kingdom.

  Mr. Maclean
  The European Commission recently announced that the eco-labelling scheme would be launched in June and that they expected to have agreed the criteria for a range of product groups by then. The number and timing of awards will depend on industry's response to the scheme and whether there are any objections to the proposed awards.

  Retail Development
  Mr. Bill Michie
  To ask the Secretary of State for the Environment what representations he has received regarding his Department's draft planning policy guidance PPG6 (revised) on town centres and retail development; and if he will make a statement.
  629
  Mr. Baldry
  We have received about 550 responses to the draft, and I expect to publish the revised guidance in the spring.

  Empty Council Properties
  Mr. Willetts
  To ask the Secretary of State for the Environment if he will list the 10 local authorities with the highest number of empty council homes.

  Mr. Baldry
  In the latest housing investment programme returns, the 10 councils reporting the highest percentage of their council house stock empty on 1 April 1992 were:

  Empty dwellings

  Liverpool

  5,552

  Hackney

  2,432

  Burnley

  368

  Manchester

  4,938

  Salford

  1,661

  North Tyneside

  1,082

  Redbridge

  373

  Tower Hamlets

  1,703

  Easington

  619

  Newcastle upon Tyne

  1,562

  These figures cover management vacants and those which are empty awaiting sale, major repairs or demolition.

  I am considering whether to put greater emphasis on a more selective definition that would better reflect underlying trends in local authorities' management performance.

  Rented Accommodation
  Mr. Nicholas Winterton
  To ask the Secretary of State for the Environment what further steps he intends to announce to increase the availability of specialist and low-cost accommodation for rent in areas of high house prices.

  Sir George Young
  Housing associations are now the main providers of new social housing for rent. The Government make capital resources available to them through the approved development programme (ADP) of the Housing Corporation, which also provides revenue support to special needs schemes.

  The allocation of the ADP between and within regions is determined by the housing needs indicator (HNI), a composite, relative indicator of the incidence of housing needs which takes account of many factors, including the number of people unable to afford to buy their own homes.

  The corporation estimates that over the three years from 1992–93 to 1994–95, 170,000 new social homes will be provided by housing associations in England—far more than the 153,000 originally forecast. Measures taken to encourage the private rented sector and to make better use of empty homes within the public sector should also increase the supply of housing for rent.

  Housing Associations
  Mr. Hendry
  To ask the Secretary of State for the Environment how many properties have been bought by housing associations using the additional sums allocated to them in the autumn statement.
  630
  Mr. Baldry
  The latest figures from the Housing Corporation show that by 19 February approvals for the purchase of 16,666 properties had been granted, with 5,755 purchases actually completed. This means that already our original target of 16,000 purchases has been exceeded, using only 93 per cent. of the funds allocated. The corporation now estimates that housing associations in England will be able to buy over 17,000 homes for those in need as a result of the allocation in the autumn statement. Another 3,500 purchases will be made possible through cash grants to tenants to become home owners. I congratulate the corporation and housing associations involved on their excellent work.

  Mr. Clapham
  To ask the Secretary of State for the Environment if he will make a statement on the future funding of small and medium-sized housing associations.

  Sir George Young
  The Housing Corporation's allocations are made in response to competitive bidding by housing associations. In 1992–93, just over half the Housing Corporation's main programme funds were allocated to housing associations with fewer than 2,500 units of stock. The allocations for 1993–94 will be announced shortly and I fully expect small and medium-sized associations to continue to be well represented among developing associations.

  Mr. Ian Taylor
  To ask the Secretary of State for the Environment if he is in a position to announce the distribution among local authority areas of the Housing Corporation's allocations to housing associations in 1993–94.

  Sir George Young
  I am pleased to announce the allocation to local authority areas of new approvals to be made by the Housing Corporation under its 1993–94 approved development programme. Copies of a table containing the information have been placed in the Library of the House. The corporation is itself writing to individual housing associations with details of their 1993–94 allocations.

  The corporation estimates that, next year, the ADP will fund the completion of 54,500 homes, including 10,000 for low-cost home ownership. This is an increase of 3,300 on the 51,200 completions anticipated for 1993–94 a year ago. In addition, the housing market package announced in the autumn statement has added an extra 19,000 units to this year's programme to achieve a total of 120,000 new housing association lettings across these two years, compared with the 94,600 anticipated at the time of the 1992–93 ADP.

  The ADP continues to provide good value for money. Competitive bidding between housing associations, consortium deals with developers, and the provision by local authorities of land at nil or reduced cost mean that the corporation expects to approve between 10 per cent. and 20 per cent. more units in 1993–94 than was estimated when decisions were announced in December about the national breakdown of the ADP. This would mean an additional 4,240 to 8,480 new homes for people in need.

  Decisions on the ADP and local authority housing investment programmes (HIPs) are now taken within a co-ordinated framework. As I announced at the time of the HIP settlement in December, local authorities, the Housing Corporation and local housing associations have

  631
  co-operated closely in preparing local programmes as part of a single housing strategy, and we have been able to consider the two programmes in parallel.

  Local Government Finance
  Mr. French
  To ask the Secretary of State for the Environment how many local authorities have increased their indebtedness in the last 10 years.

  Mr. Robin Squire
  A total of 249 local authorities are known to have increased their external debt between March 1982 and March 1992. This represents 69 per cent. of authorities for whom figures are available; data are unavailable for 40 authorities.

  Local Government (Corruption)
  Mr. Oppenheim
  To ask the Secretary of State for the Environment if he will make a statement on corruption in local government.

  Mr. Robin Squire
  I refer my hon. Friend to the answer given earlier today by my hon. Friend the Minister for Local Government and Inner Cities, to my hon. Friend the member for Norfolk, North-West (Mr. Bellingham).

  Local Government Restructuring (Lancashire)
  Mr. Elletson
  To ask the Secretary of State for the Environment if he will visit Blackpool to discuss the restructuring of local government in Lancashire.

  Mr. Robin Squire
  My right hon. and learned Friend has no plans to visit Blackpool in the immediate future.

  House Building
  Mr. Skinner
  To ask the Secretary of State for the Environment what are the latest year-on-year figures for public sector house building; and what is the comparative figure for 1979.

  Mr. Baldry
  Provisional figures show that in England in 1992 there were 20,700 housebuilding completions by housing associations and 2,900 completions by local authorities, new towns and Government Departments. The comparative figures for 1979 are 16,300 by housing associations, and 74,800 by local authorities, new towns and Government Departments.

  These figures are derived from records for building control purposes. It is sometimes difficult for local authorities, or the National House Building Council, which is responsible for building control, to identify whether a dwelling is being built for a housing association or for a private developer. This may lead to an understatement of housing association starts.

  In addition the figures cover only the construction of new dwellings, and exclude rehabilitation, purchases of existing stock and incentive payments made to tenants in order to release homes for reletting. If these are included, new units of social housing made available through housing associations funded by the Housing Corporation's approved development programme is expected to total 65,000 units in this financial year, together with around 5,000 units funded by local authority housing association grant and some 3,400 local authority units freed by the cash incentive scheme of grants to enable local authority tenants to become home owners.

  Refurbishment
  Mr. Gerrard
  To ask the Secretary of State for the Environment what representations he has received from the National Federation of Council Leaseholders regarding costs of refurbishment schemes; and if he will make a statement.

  Mr. Baldry
  The federation has made representations concerning the level of contributions demanded from council leaseholders towards costs of major works.

  I am aware that in some areas high service charge bills can cause difficulties and I have commissioned research to find out how widespread the problem is.

  Market Testing
  Mr. Lidington
  To ask the Secretary of State for the Environment whether he will consider extending market testing to a range of his own Department's activities.

  Mr. Howard
  My Department is already market testing a range of its own activities, of which the main ones are listed in the citizens charter first report (Cm 2101). But that list also includes the testing of some services which have been provided to the Department by hitherto monopoly suppliers.

  Planning Applications (Objectors)
  Mr. Martyn Jones
  To ask the Secretary of State for the Environment what plans he has to give objectors to planning applications a right of appeal to the Secretary of State.

  Mr. Baldry
  My right hon. and learned Friend has no such plans.

  Crime Prevention
  Mr. Michael
  To ask the Secretary of State for the Environment what account is taken in the current year's revenue grant settlement to local authorities of their responsibilities in crime prevention.

  Mr. Robin Squire
  There is no provision in the revenue support grant settlement which is earmarked specifically for crime prevention. Within the overall resources provided, however, police and probation services do undertake a range of functions directed towards crime prevention and reduction.

  Local Government Employment
  Mr. McAllion
  To ask the Secretary of State for the Environment what is his Department's estimate of changes in employment in local government between 1990–91 and 1992–93.

  Mr. Howard
  Over the period I estimate that the number of people employed by local government has reduced by about 75,000, the equivalent of 52,000 full-time posts or 2.8 per cent.

  Nitrate Pollution
  Sir Teddy Taylor
  To ask the Secretary of State for the Environment if he will make a statement on the impact on public water supplies of nitrate pollution.
  633
  Mr. Maclean
  Water supplies in the 2,577 water supply zones in England and Wales are routinely monitored to check their levels of nitrate against the standard of 50 milligrams per litre which is set in the relevant regulations of 1989. Most zones comply fully with this standard but, in 1991, breaches of this standard were found in 94 zones. The water companies have in place improvement programmes to secure compliance with the standard for nitrate by the end of 1995 at the latest.

  House Condition Survey
  Ms. Janet Anderson
  To ask the Secretary of State for the Environment when the results of the English house condition survey 1991 will be made available; and what will be their role in the allocation of specified capital grant resources for the English regions in 1994–95.

  Mr. Baldry
  Results from the 1991 English house condition survey will be published this year. It is planned that, for 1994–95, figures from the 1991 survey will replace the 1986 figures currently used in the formulae for the allocation of specific capital grant to English regions.

  Mr. Pike
  To ask the Secretary of State for the Environment when he now expects the house condition survey; and if he will make a statement.

  Mr. Baldry
  The results of the English house condition survey will be published this year.

  Watch Your Waste Week
  Mr. Robathan
  To ask the Secretary of State for the Environment what plans his Department has to mark Watch Your Waste Week in March; and what proposals he has for the future of the event.

  Mr. Maclean
  The Department, in conjunction with Waste Watch, has been encouraging local authorities, voluntary groups and industry to participate in Watch Your Waste Week. The week is being launched in London on 18 March and a range of events is being planned throughout the country.

  The Department also plans to have a stand at the ideal home exhibition, March 18 to April 12, which will focus, amongst other issues, on recycling.

  I would encourage all hon. Members to participate in the week. I have put details about the week in the Library of the House.

  Our aims for the campaign are to increase awareness of how people can reduce, re-use and recycle their waste and also to encourage them to buy products which minimise waste or are made from recycled products. We will consider, in the light of its effectiveness, whether or not the week should be repeated.

  Empty Properties
  Ms. Harman
  To ask the Secretary of State for the Environment what information he has on the number of empty properties purchased by housing associations or other bodies as a result of the policy changes announced in the autumn statement and the number which have been used to provide additional social housing.

  Mr. Baldry
  The latest figures from the Housing Corporation show that by 19 February approvals for the purchase of 16,666 properties had been granted, with 5,755 634
  purchases actually completed. This means that already our original target of 16,000 purchases has been exceeded, using only 93 per cent. of the funds allocated, and nearly 6,000 families have been housed. The corporation now estimates that housing associations in England will be able to buy over 17,000 homes for those in need as a result of the allocation in the autumn statement. Another 3,500 purchases will be made possible through cash grants to local authority and housing association tenants to become home owners. All the homes purchased by housing associations or freed by existing tenants will be used to provide additional social housing. I congratulate the corporation and housing associations involved on their excellent work.

  National Parks
  Mr. Llwyd
  To ask the Secretary of State for the Environment if he will make it his policy to bring forward legislation concerning the national parks in England and Wales.

  Mr. Maclean
  Our policy statement on the national parks, published in January 1992, promised legislation to create independent authorities for the eight national parks in England and Wales currently run as county council committees. I fully recognise the importance of introducing national park legislation at the earliest opportunity and I have repeatedly said that we will do so.

  Urban Partnership
  Mr. Vaz
  To ask the Secretary of State for the Environment, pursuant to his answer of 12 February to the hon. Member for Wyre Forest, (Mr. Coombs),Official Report, column 835, what was the total value of the bids put forward for urban partnership; and if he will list the successful authorities with (a) the value of the bids put forward, (b) the number of projects put forward, (c) the value of bids accepted and (d) the number of projects supported.

  Mr. Robin Squire
  The total value of the bids submitted for a share of the urban partnership fund (UPF) was £82.1 million. The table lists for the successful authorities(a) the value of bids submitted, and (b) the number of projects/packages of projects submitted. A full list of proposed projects, together with the amount of UPF support which has been agreed in principle for each, has been placed in the Library of the House. It is open to local authorities to take forward proposals which have not been offered UPF support using their capital receipts and any private sector or other contributions.

  Total value of UPF bids (£ million)

  Total number of projects/packages of projects submitted for UPF support

  Birmingham

  2.550

  14

  Bolton

  0.799

  4

  Brent

  0.750

  7

  Bristol

  0.500

  1

  Burnley

  0.395

  7

  Coventry

  7.510

  6

  Derby

  0.532

  7

  Doncaster

  1.124

  3

  Dudley

  0.775

  8

  Gateshead

  0.907

  2

  Greenwich

  1.242

  7

  Hackney

  0.498

  7

  635

  Total value of UPF bids (£ million)

  Total number of projects/packages of projects submitted for UPF support

  Hammersmith and Fulham

  0.817

  12

  Hartlepool

  0.765

  6

  Hull

  0.398

  3

  Islington

  1.107

  3

  Kirklees

  2.500

  1

  Knowsley

  3.982

  3

  Leeds

  6.020

  4

  Leicester

  0.583

  14

  Lambeth

  1.085

  4

  Langbaurgh

  0.430

  2

  Liverpool

  3.175

  2

  Manchester

  2.495

  21

  Middlesbrough

  0.896

  2

  Newcastle

  2.866

  12

  Newham

  0.807

  2

  North Tyneside

  1.862

  6

  Nottingham

  0.550

  11

  Oldham

  1.240

  4

  Plymouth

  1.794

  5

  Preston

  0.582

  3

  Rochdale

  0.840

  9

  Rotherham

  0.740

  1

  Salford

  1.657

  16

  Sandwell

  2.281

  12

  Sefton

  0.395

  2

  Sheffield

  5.320

  5

  South Tyneside

  0.710

  3

  Southwark

  1.230

  2

  Stockton

  0.177

  6

  Sunderland

  1.300

  4

  Wandsworth

  0.670

  1

  Wigan

  0.500

  3

  Wirral

  1.115

  2

  Wolverhampton

  2.000

  23

  Water Disconnections
  Mr. Frank Field
  To ask the Secretary of State for the Environment what assessment he has made of the operation of the law relating to the powers for a water company or others to cause a disconnection of a domestic consumer's water supply.

  Mr. Maclean
  The Director General of Water Services issued guidelines to water companies last year on a consistent and fair approach towards customers with unpaid charges. This followed a review of companies' policy and practice. He is now considering reports from the regional customer service committees on the effectiveness of the guidelines and will be considering what further action may be necessary. It is right that bills should be paid, but equally that water companies should provide every assistance to customers who are having difficulty meeting their bills.

  Construction Industry
  Mr. Devlin
  To ask the Secretary of State for the Environment what action is being taken to assist the construction industry.

  Mr. Baldry
  I refer my hon. Friend to the answer I gave on 27 January 1993 to my hon. Friend the Member for Macclesfield (Mr. Winterton) at columns 762–63.

  Carbon Dioxide Emissions
  Mrs. Dunwoody
  To ask the Secretary of State for the Environment what percentage of total carbon dioxide emissions is accounted for by domestic consumption of energy; and if he will make a statement.

  Mr. Maclean
  Emissions of carbon dioxide from domestic sources in the United Kingdom have been estimated at 14 per cent. of total emissions in 1990.

  Mrs. Dunwoody
  To ask the Secretary of State for the Environment what was the level of output of carbon dioxide in the United Kingdom in(a) 1992 and (b) 1991; and if he will make a statement.

  Mr. Maclean
  Estimated emissions of CO2 in the United Kingdom in 1991 and 1992 are not yet available. My Department aims to publish 1991 figures, broken down by emission source, by type of fuel, and by final user of energy, in April in the annual "Digest of Environmental Protection and Water Statistics (No. 15)".

  Housing Action Trusts
  Mr. Battle
  To ask the Secretary of State for the Environment which tenants' groups have put forward proposals for housing action trusts since the announcement of the citizens charter.

  Sir George Young
  We have had approaches from:

  Norris Green Tenants and Homeowners Association, Liverpool

  Fern Lodge Estate Tenants and Residents Association, Streatham, London

  St. George's Residents Association, Gloucester Grove Estate, Peckham, London

  Harris Street Neighbourhood Forum (Elmington Estate), Camberwell, London

  Norfolk Park Tenants and Residents Association and St. Aidan's Tenants Association, Norfolk Park Estate, Sheffield

  Departmental Publicity
  Mr. Battle
  To ask the Secretary of State for the Environment if he will provide details of the breakdown of expenditure on departmental publicity relating to housing matters for 1992–93.

  Sir George Young
  As at 23 February 1993 my Department has committed £1.86 million for publicity expenditure on housing and urban programme policies. The breakdown is as follows:

  £

  Advertising—media and production

  1,007,500

  Printing—design and production

  474,400

  Exhibitions—stand space and production

  127,300

  Audio Visual—design and production

  13,300

  Promotions

  65,000

  Fulfilment—response and postages

  53,200

  Conferences—room hire and organisation

  117,800

  Miscellaneous—small items, badges, etc.

  1,500

  Darwin Initiative
  Mr. Dalyell
  To ask the Secretary of State for the Environment how many meetings of his advisory committee under the chairmanship of Sir Crispin Tickell on the Darwin initiative have taken place; and if he will make a statement on the progress of the Darwin initiative.

  Mr. Maclean
  I refer the hon. Member to the reply my right hon. and learned Friend the Secretary of State for the Environment gave to the hon. Member for Eastleigh (Mr. Milligan) on 17 February at column 282.

  Ministers' Private Residences
  Mr. Tony Banks
  To ask the Secretary of State for the Environment if he will list the Ministers who have received public funds for approved work on their private residences arising from their ministerial duties.

  Mr. Howard
  I can answer only in respect of my own Department. There has been no such expenditure on the homes of current DOE Ministers other than strictly for security purposes. It is not in the public interest to disclose or aid the identification of security arrangements relating to public figures.

  EC Eco-audit Scheme
  Mr. Cousins
  To ask the Secretary of State for the Environment what progress has been made on the EC eco-audit scheme.

  Mr. Maclean
  I refer the hon. Member to the answer given by my right hon. and learned Friend on 20 January 1993 to my hon. Friend the Member for Rutland and Melton (Mr. Duncan) at column 267, in which he reported that the Council had reached broad agreement to the proposal.

  The Government hope that the proposal will be adopted during the Danish presidency.

  Housing Legislation
  Mr. Battle
  To ask the Secretary of State for the Environment if he will list, in order, all the primary housing legislation passed by the Government since 1979.

  Sir George Young
  The table lists, in order, the Acts directly related to housing in England passed by Parliament since 1979.

  1980—Housing Act

  1983—Mobile Homes Act

  1984—Housing and Building Control Act

  1984—Housing Defects Act

  1985—Housing Act1

  1985—Housing Associations Act1

  1985—Housing (Consequential Provisions) Act1

  1985—Landlord and Tenant Act1

  1985—Rent (Amendment) Act

  1986—Housing and Planning Act

  1987—Landlord and Tenant Act

  1988—Housing Act

  1989—Local Government and Housing Act

  1Consolidation not new legislation.

  Other primary legislation indirectly related to housing includes:

  1980—Local Government, Planning and Land Act

  1982—Social Security and Housing Benefits Act

  1983—Matrimonial Homes Act

  638

  1983—Social Security and Housing Benefits Act

  1984—Building Act

  1984—Registered Homes Act

  1986—Building Societies Act

  1986—Social Security Act

  1987—Access to Personal Files Act

  1988—Landlord and Tenant Act

  1989—Social Security Act

  1990—Social Security Act

  1991—Registered Homes (Amendment) Act

  1992—Social Security Contributions and Benefits Act

  1992—Social Security Administration Act.

  Drinking Water
  Mr. Jim Cunningham
  To ask the Secretary of State for the Environment how many prosecutions have been taken out by the drinking water inspectorate against water supply companies for failure of drinking water standards.

  Mr. Maclean
  Legislation does not provide for water companies to be prosecuted for failure to meet drinking water quality standards. A criminal offence has been created of supplying water unfit for human consumption. There have been no prosecutions of water companies to date, but the drinking water inspectorate is investigating a small number of incidents which may lead to prosecution.

  Revenue Support Grant
  Mr. Gordon Prentice
  To ask the Secretary of State for the Environment what is the level of revenue support grant per head in(a) Pendle, (b) Ribble Valley, (c) the City of Westminster, (d) Wandsworth and (e) the City of London for 1992–93 and 1993–94.

  Mr. Robin Squire
  The information requested is as follows:

  RSG per head 1992–93

  RSG per head 1993–94

  £

  £

  Pendle

  325.65

  49.62

  Ribble Valley

  292.92

  13.64

  City of Westminster

  958.85

  802.79

  Wandsworth

  714.59

  619.18

  City of London

  10,771.14

  11,225.31

  The figures for the two years are not comparable since revenue support grant for the year 1993–94 is to be paid direct to each billing and major precepting authority, whereas in 1992–93 it was all paid into the collection fund administered by the charging authority.

  Mr. Betts
  To ask the Secretary of State for the Environment how much rate or revenue support grant per head of population has been given in total to each of the metropolitan authorities since 1980; and how much extra grant Sheffield would have received over that period if it had received(a) the grant per head of the highest recipient authority and (b) the grant per head of the average of all authorities.

  Mr. Robin Squire
  [holding answer 2 February 1993]The amount of rate or revenue support grant in total for each metropolitan district authority for the period 1980–81 to 1993–94 inclusive divided by the average resident population over that period is given in the table. Sheffield would have received an extra £918 million if it had received the grant per head of the highest recipient authority and an
  639
  extra £286 million an average of £20.4 million for each year if it had received the average grant per head of the metropolitan districts. Sheffield's total RSG over the period was £1,535.2 million.

  Average rate or revenue support grant per head for metropolitan authorities since 1980–81

  Local authority

  Grant per head (£ head)

  Barnsley

  3,188

  Birmingham

  3,878

  Bolton

  3,680

  Bradford

  4,488

  Bury

  2,815

  Calderdale

  3,670

  Coventry

  3,352

  Doncaster

  3,318

  Dudley

  2,125

  Gateshead

  3,457

  Kirklees

  3,820

  Knowsley

  4,374

  Leeds

  2,888

  Liverpool

  4,557

  Manchester

  4,509

  Newcastle upon Tyne

  2,910

  North Tyneside

  3,241

  Oldham

  4,182

  Rochdale

  4,015

  Rotherham

  3,366

  Salford

  3,742

  Sandwell

  3,159

  Sefton

  2,870

  Sheffield

  2,851

  Solihull

  2,263

  South Tyneside

  4,037

  St. Helens

  3,355

  Stockport

  2,407

  Sunderland

  3,696

  Tameside

  3,496

  Trafford

  2,254

  Wakefield

  2,800

  Walsall

  2,979

  Wigan

  3,139

  Wirral

  3,229

  Wolverhampton

  3,633

SCOTLAND

  Gartnavel Hospital (Deaths)
  Mr. McFall
  To ask the Secretary of State for Scotland how many deaths have occurred in the past five years after patients placed under supervision in Gartnavel hospital, Glasgow, have left the hospital.

  Mr. Stewart
  On the understanding that all in-patients are under supervision during their stay in hospital, four Gartnavel Royal patients have died in the past five years having left the hospital without being discharged.

  Nurses
  Mr. Kirkwood
  To ask the Secretary of State for Scotland how many agency nurses were employed in each health board in each year since 1989.

  Mr. Stewart
  The information is not available centrally in the form requested. The table shows the average whole-time equivalent of the agency nurses working in health boards at 30 September each year.
  640

  Average whole time equivalents at 30 September

  Health board

  11989

  11990

  21991

  21992

  Scotland3

  211.5

  266.1

  247.4

  279.2

  Argyll and Clyde

  2.3

  2.0

  0.6

  0.3

  Ayrshire and Arran

  7.7

  2.1

  2.9

  40.9

  Borders

  4.2

  0.3

  0.0

  0.0

  Dumfries and Galloway

  0.0

  0.0

  0.4

  0.4

  Fife

  0.0

  1.1

  0.7

  0.3

  Forth Valley

  0.6

  6.8

  2.3

  0.0

  Grampian

  7.1

  6.5

  11.9

  531.4

  Greater Glasgow

  85.0

  153.4

  117.1

  164.9

  Highland

  0.0

  0.5

  0.3

  0.8

  Lanarkshire

  0.0

  0.1

  0.0

  0.0

  Lothian

  104.2

  91.4

  109.0

  80.2

  Orkney

  0.0

  0.0

  0.0

  0.0

  Shetland

  0.4

  2.7

  2.3

  0.0

  Tayside

  0.0

  0.2

  0.1

  0.0

  Western Isles

  0.0

  0.0

  0.0

  0.0

  1 Whole time equivalents calculated on the estimated total hours worked by agency nurses based on the six months data that are available.

  2 Whole time equivalents calculated on the total hours worked by agency nurses during the year ending 30 September.

  3 Rounding of individual figures may produce slight differences between the sum of constituent items and totals.

  4 Ayrshire and Arran Health Board includes agency hours at the South Ayrshire Hospitals NHS Trust.

  5 Grampian Health Board includes agency hours at Aberdeen Royal Hospitals NHS Trust.

  Mr. Kirkwood
  To ask the Secretary of State for Scotland what guidance has been given to health boards to ensure that student nurses are not unemployed when they qualify.

  Mr. Stewart
  None. The matching of newly qualified nurses to vacancies is best handled at local level. The majority of newly qualified nurses find employment on completion of their training, but student nurses are made aware at the start of their training that employment is not guaranteed at the end of their course.

  Set-aside Land
  Dr. Godman
  To ask the Secretary of State for Scotland what area of agricultural land in(a) Strathclyde and (b) Scoland as a whole is set aside under the common agricultural policy; and what is its annual value.

  Sir Hector Monro
  In 1991–92, 674 hectares in Strathclyde and 27,415 hectares in Scotland were set aside under the provisions of the common agricultural policy. Set-aside grant payments in respect of those areas amounted to £103,573 and £4,706,725 respectively. Details of land set aside in 1992–93 are not yet available.

  Marine Laboratory, Aberdeen
  Mr. Salmond
  To ask the Secretary of State for Scotland (1) what consideration he has given to conferring next steps agency status on the marine laboratory in Aberdeen; and if he will make a statement;

  (2) what consultations he has had with (a) staff, (b) the fishing industry, (c) local councils and (d) right hon. or hon. Members, regarding the possibility of conferring next steps agency status on the marine laboratory in Aberdeen; and if he will make a statement.

  Sir Hector Monro
  I refer the hon. Member to the written answer given by my right hon. Friend on 18
  641
  November 1992 at column 271, stating that the Scottish Office's fisheries research service (FRS) is being considered as a candidate for next steps agency status. The senior management of FRS are fully engaged in this consideration, and staff are being kept informed. The House will be informed of any final decision, in the normal way.

  Archaeological Sites
  Mr. Dalyell
  To ask the Secretary of State for Scotland (1) what is his assessment of the damage caused by the recent strong gales on archaeological sites in(a) Orkney, (b) Shetland, (c) St. Ninian's Isle and (d) the Western Isles;

  (2) what action he proposes to take to help rescue-archaeology in the Scottish islands;

  (3) what is the preliminary assessment on materials from Jarlshof sent by his Department for expert analysis in Aberdeen in relation to oil films.

  Sir Hector Monro
  Responsibility for the subject of the questions has been delegated to Historic Scotland under its chief executive Mr. Graeme Munro. I have asked him to arrange for a reply to be given.

  Letter from Graeme N. Munro to Mr. Tam Dalyell, dated 24 February 1993.
  As Chief Executive of Historic Scotland I am writing in response to your three Parliamentary Questions of 23 February to the Secretary of State for Scotland about rescue archaeology in the Scottish islands, the effect of the recent storms on archaeological sites in the Western Isles, Orkney and Shetland (including St. Ninian's Isle) and the preliminary assessment by the Robert Gordon University of the impact of oil from the Braer on stones from Jarlshof.
  Coastal erosion is the most serious single issue facing archaeological sites in the Scottish islands. In addition (and principally in Orkney) agricultural improvement operations in recent decades have resulted in destruction of or damage to a number of sites. However, with changes to agricultural and crofting grant schemes in the last few years such damage has reduced. Further, section 17 of the 1986 Agriculture Act effectively requires the Minister to take account of archaeological features when assessing agricultural and grant proposals. Historic Scotland has participated in Scottish Office Agriculture and Fisheries Department training courses on section 17 to ensure that staff have an awareness of archaeological features and give them appropriate consideration in terms of the statutory requirements. Historic Scotland has included in its programme of archaeological work for 1993/4 an investigation of those small burial mounds in Orkney particularly vulnerable to destruction through agricultural improvements. Other threats do arise; for instance, Historic Scotland commissioned excavation of the neolithic settlement at Barnhouse, near Stenness in Orkney, to help prevent further damage by agricultural ploughing of long-ploughed ground. I hope that publication of the proposed National Planning Policy Guideline and associated Planning Advice Note on archaeology will lead to prevention of damage to archaeological sites through development, or at least to its mitigation. On most issues, we rely largely on liaison with Islands archaeologists to alert us to sites where rescue excavation may be desirable. In addition, scheduled sites are inspected regularly by Historic Scotland monument wardens.
  Coastal erosion is unpredictable. Sites can be stable for decades; but can at almost any time be damaged by a conjunction of unfavourable tides, barometric pressures and windes. Historic Scotland and its predecessors have over the past 15 years arranged rescue surveys (Table 1) and excavations at many sites in the Scottish islands, and in particular at 35 archaeological sites and groups of sites in response to the threat of coastal erosion (Table 2). We are
  642
  giving priority now to completing publication of the majority of those surveys and excavations before embarking on any further major works to protect or excavate sites.
  Local Authorities are the lead organisations for coastal protection, and future protective measures or excavations should be considered along with other coastal issues: archaeology has been included in the brief for consultants reporting to the Scottish Office on coastal issues prior to preparation of a Review of Scottish Coastal Issues.
  The recent storms are but one episode in a continuing story of damage to archaeological sites in the coastal erosion zone. Our response illustrates the way in which, pending further consideration of coastal issues, Historic Scotland can build on previous work to react to such episodes. Inspectors from Historic Scotland have visited a selection of sites damaged by the January storms on Orkney, Shetland and the Western Isles. The Orkney Islands Archaeologist plans detailed inspection of damage to sites in Orkney with financial support from Historic Scotland. Historic Scotland will fund at least one small excavation in Orkney (at Tuquoy, supplementing previous work) and plans further detailed assessment at the Brough of Birsay as a consequence of storm damage.
  Historic Scotland has arranged sampling at one damaged site in the Western Isles; other sites visited by an Inspector and damaged in the storms had been sampled previously; no systematic survey is planned at this time but this positiion will be reviewed in April following submission of reports covering survey and excavations in the Western Isles (see Table 2).
  Historic Scotland has had no request from the Shetland Islands archaeologist for emergency assessment of sites following the January storms; no systematic survey is planned. A further inspection by officers of Historic Scotland is planned for late February when I shall myself be visiting Shetland.
  Assessment of the effects of pollution from oil spilled from the Braer wreck on Jarlshof and neighbouring sites has already commenced. We sent one soil and 9 stone samples from the Jarlshof site to the Robert Gordon University Faculty of Science and Technology on 20 January to enable them to undertake a preliminary analysis of the extent of pollution. The intention was to help Historic Scotland clarify its position regarding a possible clean up of the site following the Braer oil tanker wreck and to assist in determining what appropriate conservation measures should be taken.
  The preliminary results indicate that the site is contaminated with crude oil residues. In the absence of an authentic sample of the Braer's cargo, it has not yet been possible to confirm that the ship was the source of the contamination, though the circumstances very strongly suggest it.
  There is as yet insufficient information upon which to decide the most appropriate course of action. A programme of further short, and longer term, monitoring is needed. This will look at the effects of the contamination on the biological growth on the stonework, the way it affects the weathering of the stone, and how it may alter the aesthetic appearance.
  To undertake this effectively, an on site monitoring programme is envisaged which would run in parallel with a detailed literature search. This would help put the study into a broader scientific context. In addition, laboratory and field studies of the effects of remedial or preventative actions would also be instigated. The work would be carried out in conjunction with other research programmes instigated by The Scottish Office and undertaken by the Macaulay Land Use Research Institute.
  I believe that Historic Scotland's record of activity at sites suffering from coastal erosion and other threats in the Scottish islands, summarised in the attached tables, demonstrates our concern and our willingness to respond. By its very nature, rescue excavation is reactive. We are seeking to ensure that wherever possible responses are made within a strategic framework.
  Thus the actions which Historic Scotland on behalf of the Secretary of State for Scotland proposes to take to help rescue-archaeology in the Scottish Islands build on those which Historic Scotland has taken in the past. Historic Scotland is putting considerable effort into publication of those sites which have already been excavated, and it is reviewing the relative cost-effectiveness of further rescue excavations and protection. It is also taking measures to

  643
  increase awareness of archaeological sites in other Scottish Office departments and to improve the coordination of protection and rescue activities and to ensure harmonisation with the work of other agencies.

  Table 1—Scottish islands: A list of coastal archaeological surveys commissioned by Historic Scotland plus archives with a high coastal component

  Region and source

  Proportion covered

  Comments

  Orkney

  Lamb

  Good cover

  In archive

  Shetland

  Turner

  Good cover

  In archive

  Western Isles

  Cowie

  More than half the west coast

  Formal report due March 1993, interim reports received

  Shepherd

  Barber

  Branigan

  Table 2

  Scottish Islands: Excavations in advance of marine and aeolian erosion in the coastal erosion zone commissioned or sponsored by historic Scotland between 1977 and 1992

  Excavator

  Last field season

  Submission to Historic Scotland

  ORKNEY

  Birsay Bay proj. 1

  Morris et al

  81

  published

  Birsay Bay proj. 2

  Morris et al

  83

  93

  Brough of Birsay 1

  Morris et al

  83

  93

  Brough of Birsay 2

  Hunter

  81

  published

  Hurnips Point

  Hunter

  91

  published

  Noltland

  Clarke

  81

  95 to 96

  Point of Cott

  Barber

  85

  93

  Pool

  Hunter

  88

  93

  Scar

  Dalland

  91

  93

  St. Boniface

  Lowe

  90

  94 to 95

  Skara Brae II

  Clarke

  77

  95 to 96

  Tresness

  Smith

  83

  archive

  Tuquoy

  Owen

  88

  93 to 95

  Warebeth

  Bell

  88

  published

  SHETLAND

  Burland

  Barber et al

  83

  93 to 94

  Cunningsburgh

  Barber et al

  90

  93 to 94

  Eastshore

  Barber et al

  83

  93 to 94

  Fair Isle Harbour

  Barber et al

  83

  93 to 94

  Ness of Burgie

  Barber et al

  83

  93 to 94

  Sands of Breckon

  Barber et al

  83

  93 to 94

  Scantness

  Barber et al

  83

  93 to 94

  WESTERN ISLES

  Balelone

  Barber et all

  83

  93

  Baleshare

  Barber et all

  90

  93

  Barvas

  Cowie

  79

  93

  Callanish Leobag

  Cowie

  79

  93

  Dalmore

  Ponting

  83

  93 to 94

  Dalmore

  Sharpies Parker-

  83

  93 to 94

  Dun Vulan

  Pearson

  93

  field still

  Hornish

  Barber et al

  84

  93

  Kneep

  Close-Brooks

  78

  93 to 94

  Kneep

  Armit

  92

  92

  Newton Ferry

  Barber et al

  84

  93

  Rosinish

  Shepherd

  77

  94

  South Glendale

  Barber

  83

  94

  Udal RUX6

  Crawford

  83

  94 to 95

  Drugs
  Dr. Godman
  To ask the Secretary of State for Scotland what discussions he has held with organisations in(a) Inverclyde and (b) Strathclyde in relation to ways of dealing with drug problems; what proposals he has put forward for Scottish Office assistance; and if he will make a statement.

  Mr. Stewart
  [holding answer 12 February 1993]Drug misuse in Strathclyde is a matter of continuing concern to my right hon. Friend; and the Scottish Office is in regular contact with statutory and voluntary bodies in the area. Assistance, through funding, in tackling drug misuse is provided directly and indirectly by the Scottish Office in a number of ways. In particular, Strathclyde regional council is receiving support through the urban programme for drug-related projects, including the Inverclyde Drugline.

  Student Housing
  Mr. Salmond
  To ask the Secretary of State for Scotland what was the total cost of payments from Scottish Homes to the student housing sector in each year since 1988.

  Lord James Douglas-Hamilton
  [holding answer 18 February 1993]Scottish Homes estimates that nearly £1.2 million was paid in 1990–91 and £0.9 million in 1991–92 towards providing accommodation specifically for students. Students may also have access to other general needs housing funded by Scottish Homes.

  Superquarries
  Mr. Martlew
  To ask the Secretary of State for Scotland if he will list the sites which have been identified in Scotland as having potential for the development of superquarries; and if he will make a statement.

  Mr. Stewart
  [holding answer 22 February 1993]The Scottish Development Department's 1977 national planning guidelines on aggregate working provisionally identified five potential locations for superquarry development: Peterhead, Loch Linnhe, Helmsdale, Harris and the Ross of Mull. In 1980 a subsequent preliminary research report entitled "Potential for a Large Coastal Quarry in Scotland" produced a short-list of five locations with suitable mineral deposits and marine access. These were South Harris, Loch Ewe, Loch Linnhe, Kentallen, and Walls (Shetland Isles). In addition, the Highland region structure plan (approved in 1990) identified Loch Eriboll. More recently a study by ARUP consultants for the Department of the Environment identified a number of broad locations in Scotland where the geological and other technical criteria exist for the development of coastal superquarries ie Shetland, the Western Isles and parts of the west and north coast. The draft national planning policy guidelines on land for mineral working published in 1992 do not specify any other locations.

  Any proposals for the development of coastal superquarries will be assessed on their merits and full regard will be had to their possible environmental impact.

  Fishing Vessels
  Mr. Wallace
  To ask the Secretary of State for Scotland if he will list the vessels and tonnage of vessels owned or operated by the Scottish Fisheries Protection Agency; and which are registerd on the fishing vessel register.

  Sir Hector Monro
  [holding answer 23 February 1993]The Scottish Fisheries Protection Agency owns seven fishery protection vessels and two research vessels as follows:

  Gross tonnage

  Fishery Protection Vessels

  Norna

  1,385

  Vigilant

  1,250

  Sulisker

  1,250

  Westra

  885

  Moidart

  65

  Morven

  65

  Skua

  7

  Research Vessels

  Scotia

  1,521

  Clupea

  176

  The fishery protection vessels are operated by the agency while the research vessels are operated by a private contractor. None of the vessels is on the fishing vessel register.

  European Structural Funds
  Mr. Maclennan
  To ask the Secretary of State for Scotland, pursuant to his answer of 12 January to the hon. Member for Caithness and Sutherland,Official Report, column 718, what progress he has made towards the recognition of the highlands and islands in the list of objective 1 areas for the allocation of European structural funds; and if he will make a statement.

  Mr. Stewart
  [holding answer 23 February 1993]The gross domestic product figure for the highlands and islands has been agreed with Eurostat to be 79 per cent. of the Community average, and the Government have made representations to the Commission seeking objective 1 status for the highlands and islands. We expect the Commission's proposals to be published shortly and will be arguing the case strongly in the Council of Ministers when these are considered.

  Harbour Closure, Greenock
  Dr. Godman
  To ask the Secretary of State for Scotland when the hon. Member for Greenock and Port Glasgow can expect a response to his letter, dated 23 December 1992, about a proposal submitted by Renfrewshire Enterprise for the closure of East India harbour, Greenock.

  Sir Hector Monro
  [holding answer 23 February 1993]An acknowledgement was sent to the hon. Member's letter on 21 January 1993. The application from Renfrewshire Enterprise raises complex issues which the Scottish Office Agriculture and Fisheries Department is considering as quickly as possible. I hope to send the hon. Member a full reply in the near future.

  Sheltered Placement Schemes
  Mr. McMaster
  To ask the Secretary of State for Scotland if he will publish a table itemising how the budget for sheltered placement schemes was expended in Scotland in the financial year 1991–92; what provisions have been made in the financial year 1992–93; how this compares with the previous year in(a) real and (b) per capita terms; and if he will make a statement.

  Mr. Stewart
  [holding answer 27 January 1993]Expenditure on the sheltered placement scheme in Scotland for the financial year 1991–92 was as follows:

  £

  Local Authority contribution

  525,845

  Employment Service contribution

  1,274,689

  Total

  1,800,534

  Working years on sheltered placement schemes claimed were 411.190, and expenditure per worker was £4,379.

  Figures for 1992–93 are not yet available.

  Hospital Incinerators
  Mr. Gareth Wardell
  To ask the Secretary of State for Scotland if he will publish a list of the hospital incinerators in Scotland that(a) burn less than 25 kg of clinical waste per hour and (b) burn less than 1 tonne of clinical waste per hour.

  Mr. Stewart
  [holding answer 17 February 1993]The following is a schedule of clinical waste incinerators presently in use within the NHS in Scotland:

  Hospital Incinerators

    Hospitals with incinerators with a capacity of less than 25kG/HR
    Dumfries and Galloway Health Board

    Thomas Hope Hospital, Langholm

    Moffat Hospital

    Newton Stewart Hospital

    Thornhill Hospital

    Highland Health Board

    Portree Hospital

    Tayside Health Board

    Montrose Royal Infirmary

    Arbroath Infirmary

    Hospitals with incinerators with a capacity greater than 25 kG/hr and less than 1 tonne/hr
    Argyll and Clyde Health Board

    Royal Alexandra Hospital, Paisley

    Inverclyde Royal Hospital, Greenock

    Islay Hospital, Bowmore

    Ayrshire and Arran Health Board

    Crosshouse Hospital, Kilmarnock

    Ailsa Hospital, Ayr

    Borders Health Board

    Borders General Hospital

    Dumfries and Galloway Health Board

    Castle Douglas Hospital

    Kirkcudbright Hospital

    Garrick Hospital, Stranraer

    Cresswell Maternity Hospital, Dumfries

    Lochmaben Hospital

    Crichton Royal Hospital, Dumfries

    647

    Dalrymple Hospital, Stranraer

    Annan Hospital, Annan

    Fife Health Board

    Cameron Hospital, Windygates

    Stratheden Hospital, Cupar

    Victoria Hospital, Kirkcaldy

    West Fife District General Hospital (Phase I), Dunfermline

    Dunfermline and West Fife Hospital, Dunfermline

    West Fife District General Hospital (Phase II), Dunfermline

    Forth Valley Health Board

    Falkirk Royal Infirmary

    Stirling Royal Infirmary

    Greater Glasgow Health Board

    Cowglen Hospital, Glasgow

    Gartnavel General Hospital, Glasgow

    Glasgow Royal Infirmary

    Ruchill Hospital, Glasgow

    Southern General Hospital, Glasgow

    Stobhill General Hospital, Glasgow

    Western Infirmary, Glasgow

    Royal Hospital for Sick Children, Glasgow

    Highland Health Board

    Raigmore Hospital, Inverness

    Craig Dunain Hospital, Inverness

    Belford Hospital, Fort William

    Caithness General Hospital, Wick

    Lothian Health Board

    Western General Hospital, Edinburgh

    Eastern General Hospital, Edinburgh

    City Hospital, Edinburgh

    St. John's Hospital, Howden

    Tayside Health Board

    Sunnyside Royal Hospital, Montrose

    Stracathro Hospital, Brechin

    Murray Royal Hospital, Perth

    Ninewells Hospital, Dundee

    Western Isles Health Board

    Western Isles Hospital, Isle of Lewis

    Daliburgh Hospital, Isle of South Lewis

    Orkney Health Board

    Balfour Hospital, Orkney

DEFENCE

  Consultants
  Ms. Mowlam
  To ask the Secretary of State for Defence how many contracts for consultancies were awarded by his Department over(a) the last 12 months and (b) 1991–92.

  Mr. Aitken
  In the 12 months from 1 February 1992 to 31 January 1993, my Department placed at least 582 contracts which involved some form of consultancy; the exact figure may be a little higher, since contracts placed towards the end of January have not been recorded centrally. The exact figure for 1991–92 was 563.

  These figures include various forms of technical consultancy, as well as management consultancy; it is not possible to differentiate them from the figures available.

  Ms. Mowlam
  To ask the Secretary of State for Defence if he will list the contracts awarded by his Department to(a) Coopers and Lybrand management consultants, (b) Touche Ross management consultants, (c) Price Waterhouse management consultants, (d) Ernst and Young management consultants, (e) Chrichton Roberts Ltd., (f) KPMG management consultants and (g)
  648
  Leopold Joseph management consultants, with the total cost of the contracts with each contractor for (i) the past 12 months and (ii) 1991–92.

  Mr. Aitken
  My Department has no record of any contracts having been placed with Chrichton Roberts Ltd. or Leopold Joseph Management Consultants Ltd. The number and value of contracts placed with the other five companies is as follows. Contracts placed in February/ March 1992 will, of course, appear in both columns:

  February 1992/January 19931

  1991/1992

  Coopers and Lybrand2

  12 contracts £8,740,330

  12 contracts £4,624,622

  Touche Ross Management Consultants

  11 contracts £1,412,831

  13 contracts £802,305

  Price Waterhouse2

  9 contracts £1,136,039

  8 contracts £471,122

  Ernst and Young Management Consultants

  4 contracts £335,300

  5 contracts £559,653

  KPMG Management Consulting

  1 contract3

  Nil

  1 May be subject to revision, as contracts placed towards the end of January may not yet have been recorded centrally.

  2 Available statistics do not indentify "Management Consultants" separately from other parts of these firms. Consequently some of these contracts may be for services other than management consultancy.

  3 This is the contract mentioned in my answer to the hon. Lady on 25 January 1993 (Official Report, Column 560). As it is our practice to treat values of individual contracts as "Commercial in Confidence", I am not able to reveal the value of this contract.

  It is not possible to list the subject of each and every one of these contracts without disproportionate effort.

  Land Mines
  Mr. Mullin
  To ask the Secretary of State for Defence what discussions he has had regarding the United States Government's embargo on the export of land mines.

  Mr. Aitken
  We have had no such discussions.

  RAF Chivenor and Brawdy
  Mr. Ainger
  To ask the Secretary of State for Defence (1) how many military training sorties were flown in each year since 1986 within 120 nautical miles of RAF Chivenor;

  (2) how many military training sorties were flown in each year since 1986 within 40 nautical miles of RAF Chivenor;

  (3) how many military training sorties were flown in each year since 1986 within 40 nautical miles of RAF Brawdy;

  (4) how many military training sorties were flown in each year since 1986 within 120 nautical miles of RAF Brawdy.

  Mr. Archie Hamilton
  The information requested is not available.

  Mr. Ainger
  To ask the Secretary of State for Defence how many non-military incidents search and rescue helicopters based at (i) RAF Brawdy and (ii) RAF Chivenor have responded to in(a) daylight and (b) night-time in each of the last five years.
  649
  Mr. Archie Hamilton
  The information requested is set out in the table.

  1988

  1989

  1990

  1991

  1992

  RAF Brawdy

  Day

  110

  115

  121

  111

  107

  Night

  31

  28

  42

  44

  43

  Total

  141

  143

  163

  155

  150

  RAF Chivenor

  Day

  151

  160

  140

  134

  158

  Night

  18

  16

  5

  5

  6

  Total

  169

  176

  145

  139

  164

  With effect from 1 October 1989 RAF Chivenor moved from a 24-hour search and rescue service to day time only. The figures shown for night-time against Chivenor in 1990–92 relate to cases where SAR helicopters responded in daylight but returned to base after dark.

  Military Flying
  Mr. Ainger
  To ask the Secretary of State for Defence what areas of the United Kingdom are classified as areas of high intensity military flying; and what are the criteria it uses to decide that classification.

  Mr. Archie Hamilton
  I refer the hon. Member to information contained in the Civil Aviation Authority publication "United Kingdom Aeronautical Information Publication", a relevant extract of which I am placing in the House of Commons Library.

  Official Entertainment
  Mr. Tony Banks
  To ask the Secretary of State for Defence how much was spent on official entertainment in his Department during 1991–92 and 1992–93 to date.

  Mr. Archie Hamilton
  In the financial year 1991–92, £4.007 million was spent. As at 31 January 1993, £3.283 million has been spent in financial year 1992–93. This figure includes expenditure incurred by the Ministry of Defence itself, by formations and establishments of the armed forces at home and abroad, and by individual officers occupying command and international appointments for which entertainment allowances are payable.

  Redundancy Payments
  Mr. Boyce
  To ask the Secretary of State for Defence, pursuant to his answer of 9 February,Official Report, column 575, what was the total bill for redundancy payments paid to the service personnel who left the armed forces on or before 31 December 1992 as a result of "Options for Change".

  Mr. Archie Hamilton
  Expenditure up to 31 December 1992 on special capital payments to personnel who left the services on redundancy terms under "Options for Change" was £83.743 million. In addition, these personnel qualified for immediate terminal grants and pensions/retired pay which would normally have become payable on completion of their engagements/commissions. Up to 31 December 1992 expenditure on terminal grants was £64–647 million and on pensions/retired pay, including lump sum commutation payments, was £46.037 million.

  Gulf War
  Mr. Jacques Arnold
  To ask the Secretary of State for Defence if he will make a statement on whether ships, regiments and squadrons which took part in the Gulf campaign will be able to include the campaign in their battle honours.

  Mr. Rifkind
  Her Majesty the Queen has graciously approved the award of battle honours to ships, regiments and squadrons of the three services which took part in the campaign to liberate Kuwait.

  The award of the battle honour "Kuwait 1991" is to be made to those of Her Majesty's ships, Royal Naval air squadrons and Royal fleet auxiliaries which were either actively engaged in operations against Iraqi forces or engaged in logistic support duties in the central and northern Gulf to the west of the meridian 51E at any time between 17 January and 28 February 1991. The ships and naval air squadrons which qualify are as listed.

  The theatre honour "Gulf 1991" and battle honours "Wadi Al Batin" and "Western Iraq" have been approved for the Army. Those Army regiments and the Army air corps which took part in the campaign will be entitled to claim these honours in accordance with normal practice in the Army.

  The battle honour "Gulf 1991" has been approved for the Royal Air Force. Squadrons which took part in the campaign will be selected by the Air Force Board to receive this honour.

  After claims by regiments and the Army Air Corps have been considered by the Army Board, and Royal Air Force squadrons have been selected by the Air Force Board, recommendations will be submitted to Her Majesty the Queen for approval. I am therefore not able at this stage to list the regiments and squadrons that will be honoured, but these will be reported to the House in due course.

  Her Majesty's Ships, Naval Air Squadrons and Royal Fleet Auxiliaries to receive the battle honour "Kuwait 1991"

  Her Majesty's Ships

  HMS Atherstone

  HMS Gloucester

  HMS Brave

  HMS Hecla

  HMS Brazen

  HMS Herald

  HMS Brilliant

  HMS Hurworth

  HMS Cardiff

  HMS Ledbury

  HMS Cattistock

  HMS London

  HMS Dulverton

  HMS Manchester

  HMS Exeter

  Royal Navy Air Squadrons

  815

  845

  826

  846

  829

  848

  Royal Fleet Auxiliaries

  RFA Argus

  RFA Resource

  RFA Bayleaf

  RFA Sir Bedivere

  RFA Diligence

  RFA Sir Galahad

  RFA Fort Grange

  RFA Sir Percivale

  RFA Olna

  RFA Sir Tristram

  Bosnia
  Mr. Menzies Campbell
  To ask the Secretary of State for Defence how many Mercedes-Benz tractor-trailer units are being used by United Kingdom forces in Bosnia; and what arrangements have been made for their servicing.
  651
  Mr. Archie Hamilton
  [holding answer 20 January 1993]Routine servicing is carried out by the REME personnel. Any major repairs necessary would be carried out by the local Mercedes-Benz agent.

EMPLOYMENT

  Industrial Tribunals
  Mr. Peter Bottomley
  To ask the Secretary of State for Employment if she will set targets for faster access to hearings at industrial tribunals and to the employment appeal tribunal in England and Wales.

  Mr. McLoughlin
  The Government aim to reduce the current time taken for cases to reach a hearing at the industrial tribunals and the employment appeal tribunal in England and Wales, and to help achieve this have increased the number of judges, chairmen, lay members and administrative staff and have expanded the premises. In addition, the Trade Union Reform and Employment Rights Bill provides that chairmen and judges may sit alone in certain cases.

  Mr. Peter Bottomley
  To ask the Secretary of State for Employment what is the time taken for an appeal to come to hearing at the employment appeal tribunal in(a) England and Wales and (b) Scotland; and what assessment has been made of the reason for the difference between the figures.

  Mr. McLoughlin
  As regards the waiting times. I refer the hon. Member to the reply I gave him on 16 February 1993,Official Report, columns 190–91. One reason for the difference in waiting times is the lower workload in Scotland. There are also procedural differences in the handling of notices of appeal. However, additional judges have been appointed to the employment appeal tribunal and I expect this to be reflected in the waiting time in England and Wales.

  Labour Statistics
  Mr. Garnier
  To ask the Secretary of State for Employment what are the latest white collar unemployment figures for the(a) Leicester, (b) Luton, (c) York, (d) Exeter, (e) Chester, (f) Ashton-under-Lyne, (g) Stanmore and (h) Glasgow travel-to-work areas.

  Mr. McLoughlin
  The information requested is not available. Information on unemployment by occupation groups can be obtained from the Labour Force Survey, but only disaggregated to the level of standard regions.

  Asbestos
  Mr. Cox
  To ask the Secretary of State for Employment when the existing legislation as to the handling of asbestos in its manufacture or removal from buildings was last reviewed; and if she will make a statement.

  Mr. McLoughlin
  All work with asbestos is governed by the Control of Asbestos at Work Regulations 1987. These were reviewed in 1992, together with their associated approved code of practice—ACoP—when regulations were being prepared to implement a European directive amending the 1983 asbestos worker protection directive. The Health and Safety Commission published a652
  consultative document on the revisions last June. The new asbestos regulations came into force on 1 January 1993, and the revised ACoP will be published in early March.

  Work with asbestos insulation and coating, including their removal, is also subject to the Asbestos (Licensing) Regulations 1983. These were last formally reviewed in 1986–87, although the Health and Safety Executive monitors their day-to-day effectiveness. Practical guidance on all work with asbestos insulation and coating materials is set out in a second asbestos ACoP which was also reviewed in 1992 and is due to be published in early March. This strongly encourages the adoption of work methods which are designed to limit the amount of dust that can be generated during asbestos removal activities.

  Mr. Cox
  To ask the Secretary of State for Employment how many companies have been charged with not providing adequate safety facilities for workers employed by them in the removal of asbestos from buildings in the last five years; and if she will make a statement.

  Mr. McLoughlin
  Statistics collected by the Health and Safety Executive do not separately identify charges relating specifically to the removal of asbestos from buildings. The following table shows all informations laid and convictions secured by the HSE under the Asbestos Regulations 1969, the Asbestos (Licensing) Regulations 1983 and the Control of Asbestos at Work Regulations 1987. The period covered by the table is for the latest five-year period for which figures are available. Those for 1991–92 are provisional. Details of charges brought by individual local authorities are not collated centrally and so are not readily available, but cases are likely to be rare.

  Prosecution action taken under the Asbestos Regulations 1969

  Informations laid

  Convictions

  1987–88

  14

  8

  1988–89

  4

  3

  Regulations revoked from 1 March 1988.

  Prosecution action taken under the Asbestos (Licensing) Regulations 1983

  Informations laid

  Convictions

  1987–88

  32

  27

  1988–89

  14

  13

  1989–90

  14

  7

  1990–91

  7

  7

  1991–92

  8

  7

  Prosecution action taken under the Control of Asbestos at Work Regulations 1987

  Informations laid

  Convictions

  1987–88

  1—

  1—

  1988–89

  21

  21

  1989–90

  52

  47

  1990–91

  57

  48

  1991–92

  45

  39

  1 Regulations not in force.

  Wages Councils
  Mr. Peter Bottomley
  To ask the Secretary of State for Employment if she will estimate the effect on pay of a 1 per cent. change in the level of employment in industries covered by wages councils; and if she will estimate the effect on levels of employment of a 10 per cent. change in the level of pay in wages councils industries.

  Mr. Michael Forsyth
  The relationship between pay and employment is determined by a large number of factors and it is not possible to make precise estimates for individual industries. However, the evidence clearly suggests that, whatever the industry, uneconomic pay increases have a significant and damaging effect on employment.

  Mine Safety
  Mr. Hardy
  To ask the Secretary of State for Employment if she will make it her policy to refrain from granting exemptions from mine safety regulations which allow underground development to advance without roof support beyond 2 m or whose advance extends to distances at which safety cannot be guaranteed or gas cannot be tested with the approved apparatus.

  Mr. McLoughlin
  Exemptions from certain of the requirements of mining legislation may only be granted by the Health and Safety Executive inspectorate of mines.

  An HSE inspector of mines may exempt a mine, or part of a mine, from the requirements of a particular Act or regulation providing that the inspector is satisfied that the safety of persons employed at the mine will not be prejudiced by the granting of the exemption.

  Fixed-term Contracts
  Mr. Denham
  To ask the Secretary of State for Employment what estimate she has made of the number of employees on fixed-term contracts in the United Kingdom.

  Mr. McLoughlin
  The latest estimate for the United Kingdom from the spring, March to May, 1992 labour force survey, is that there were 581,000 employees on fixed-term contracts in the United Kingdom.

  Training
  Mr. Tony Lloyd
  To ask the Secretary of State for Employment what was the total amount spent by her Department of the budget for training, for England in each year, since 1989–90, the expected outturn in 1992–93 and plans for 1993–94 in 1992–93 prices and cash terms.

  Mr. McLoughlin
  The information requested is given in the following table. The figures include training programme expenditure and administrative/running costs. The figures are also published in the 1992–93 departmental report.

  England training expenditure in cash and real terms (1992–93 prices) 1989–90 to 1991–92 and expected outturn in 1992–93 and plans for 1993–94

  £ million

  1989–90

  Cash

  2,240

  Real terms

  2,696

  654

  £ million

  1990–91

  Cash

  2,053

  Real terms

  2,288

  1991–92

  Cash

  1,906

  Real terms

  1,987

  1992–93

  Estimated

  2,367

  Outturn

  1(2,019)

  2(1,771)

  1993–94

  Cash

  2,142

  3(1,963)

  Real terms

  2,201

  1 Net ESF.

  2 Net ESF and admin/running costs.

  3 Net admin/running costs.

  Notes:

  1. Does not include European Social Fund except 1992–93.

  2. Does not include admin/running costs for 1989–90, 1990–91, 1991–92.

  3. Plans for 1993–94 include, under Training for Work, funds which in 1991–92 and 1992–93 were allocated to Employment Action, a non-training programme.

  4. Source for 1992–93 running costs outturn is the Spring Supplementary Estimate.

  Mr. Tony Lloyd
  To ask the Secretary of State for Employment what was the total amount spent by her Department of the budget for training, for Great Britain, in each year since 1989–90, the expected outturn in 1992–93 and plans for 1993–94 in 1992–93 prices and cash terms.

  Mr. McLoughlin
  The information requested is given in the following table. The figure includes training programme expenditure and administrative/running costs. The figures are also published in the 1992–93 departmental report.

  Training expenditure 1989–90 to 1992–93 and plans for 1993–94 at 1992–93 prices, Great Britain

  £ million

  1989–90

  Cash

  2,940

  Real terms

  3,538

  1990–91

  Cash

  2,802

  Real terms

  3,123

  1991–92

  Cash

  2,694

  Real terms

  2,808

  1992–93

  Estimated Outturn

  2,761

  1993–94

  Cash

  2,557

  Real Terms

  2,627

  Source:

  Appropiation Accounts 1993 Spring Supplementary Estimate.

  Note:

  Administrative and Running Costs are not available for 1993–94.

  Redundancy Payments
  Mr. Cousins
  To ask the Secretary of State for Employment how many cases in each of the last four years were processed through the redundancy payments service in situations of enterprise solvency in each region and county and for the United Kingdom as a whole.

  Mr. McLoughlin
  The number of claims processed by the redundancy payments service in Great Britain for the last four complete financial years was:

  Claims

  1991–92

  305,574

  1990–91

  189,185

  1989–90

  110,132

  1988–89

  100,934

  Information on a regional or county basis is not available. Separate arrangements apply in Northern Ireland.

  Mr. Cousins
  To ask the Secretary of State for Employment what is the current average processing time of redundancy payment claims; what was the time in the circumstances of the insolvency of enterprises in each of the last four years; and in how many cases the delay in claim exceeded 12 weeks.

  £ million

  1991–92

  1990–91

  1989–90

  1988–89

  Payments

  To employees, in respect of arrears of pay, holiday pay, compensation for pay in lieu of notice and certain other payments

  148.0

  75.9

  33.1

  29.7

  To occupational pension schemes in respect of unpaid contributions

  2.9

  0.9

  0.5

  0.6

  TOTAL PAYMENTS

  150.9

  76.8

  33.6

  30.3

  Debt recovery

  Recovery of debts in insolvency

  12.2

  7.9

  9.0

  9.5

  Note: Because of the delay between the making of payments and the eventual settlement of claims in the insolvency, the sums recovered do not correspond directly to the year in which payments were made.

  Small Firms (Regulations)
  Mr. Fatchett
  To ask the Secretary of State for Employment if she will list all those regulations affecting small firms which have been abolished by her Department in each year since 1979.
  656
  Mr. McLoughlin
  The information is not available in the precise form requested. The current average time taken by the redundancy payments service to process claims for redundancy and insolvency payments is six weeks. The comparable figure for 1991–92 was 7.6 weeks.

  In the period 1 April 1992 to 31 January 1993, 88.7 per cent. of claims were processed by the redundancy payments service within 12 weeks. In 1991–92, the figure was 79.7 per cent. Information is not available for previous years.

  Up to 10 working days is allowed for payment by the Department's finance office after approval of a claim.

  Mr. Cousins
  To ask the Secretary of State for Employment if she will give for each of the last four years the cost to the redundancy payments service of meeting payment shortfalls due to the insolvency of enterprises; and how much of this was subsequently recovered.

  Mr. McLoughlin
  The Employment Protection (Consolidation) Act 1978 provides for various payments out of the national insurance fund when an employer is unable to make them by reason of insolvency. Payments made and sums recovered in the last four years were as follows:

  Mr. McLoughlin
  [holding answer 23 February 1993]I shall arrange for a list of regulations affecting business which have been abolished by the Department to be placed in the Library by early March.

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

EC Trade with the United States
Lord Campbell of Croy Lord Campbell of Croy asked Her Majesty's Government:
Whether they will press, within the European Community, for negotiations to reduce hindrances to trade with the United States of America.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Baroness Denton of Wakefield): My Lords, my right honourable friend the Prime Minister is raising trade issues with President Clinton today in Washington. We will continue to work within the European Community to avert trade disputes with the United States.
Lord Campbell of Croy: My Lords, I am grateful to my noble friend for her reply. Sir Leon Brittan, and now the Prime Minister, are clearly doing their best to prevent an outbreak of protectionism. Although the United States has been accused of discrimination with its Buy American Act, why is it necessary for EC members to require their government-owned utilities to favour EC products? This appears to invite retaliation.
Baroness Denton of Wakefield: My Lords, I am pleased to tell my noble friend that while the utilities directive contains some limited discriminatory provisions it is essentially a market opening measure and gives US firms opportunities in Europe which they have not had before. British companies bidding for contracts in the US, on the other hand, continue to face the iniquities of the Buy American Act.
Lord Eatwell: My Lords, does the Minister agree that the issues raised by the current trade differences between the United States and the European Community are properly a matter for the present GATT Round? Does she accept that the optimism which she expressed on 25th January about the rapid conclusion of the GATT talks was entirely misplaced and that the 1st March deadline for fast-track ratification by the US Congress is not now likely to be met? Can she tell the House whether the Prime Minister in his meetings with President Clinton is attempting to secure an extension of that deadline?
Baroness Denton of Wakefield: My Lords, I believe that I share the disappointment of everyone in your Lordships' House that the GATT agreement has not been signed. On the other hand, I do not believe that optimism in this area is wrong because it is so important that the agreement is signed. Everyone, I understand, agrees with that. I am pleased to say that President Clinton has indicated that he will be looking
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for an extension of the fast track. What my right honourable friend the Prime Minister will be pushing for today is that this should be as short a period as possible.
Lord Mackay of Ardbrecknish: My Lords, my noble friend's statement is welcome and indeed I am sure that we all wish the Prime Minister well in negotiating on trade matters with President Clinton. However, I wonder whether she will also consider the negotiations that are needed within the European Community itself to reduce the hindrance to trade that we have seen from the French in the past two or three days.
Baroness Denton of Wakefield: My Lords, I understand that that is a sympathetic question in your Lordships' House but I am amazed that my geography is rather better than my noble friend's. We are talking about North America on this occasion.
Lord Bruce of Donington: My Lords, I agree with the noble Baroness that we are talking about North America, but North America is part of the world as a whole. Does she not agree that, irrespective of the results of the conversation of her right honourable friend the Prime Minister with President Clinton, the real nigger in the woodpile is France, as indicated by her noble friend? Will she see to it that the obstacles to GATT that are put up by France are removed without delay?
Baroness Denton of Wakefield: My Lords, I am pleased that my right honourable friend is meeting President Clinton today. No one could be more committed to ensuring that the GATT agreement is signed. As President of the European Community, a great deal of the Prime Minister's energies were directed to ensuring that the members of the European Community were working together. We have a great advantage in that the negotiating Commissioner is now Sir Leon Brittan, who will make quite certain that agreements are held to.
Lord Bruce of Donington: My Lords, I hope the noble Baroness is right.
Lord Campbell of Croy: My Lords, my noble friend has explained that the EC utilities directive should help American firms. Can more be done to spread that information among business and industry in the United States?
Baroness Denton of Wakefield: My Lords, I am pleased to tell my noble friend that, in recognising North America's importance to the UK and in reporting an increase in exports last year, we at the DTI are planning a three-year North America trade promotion campaign in which we aim to increase United Kingdom companies' awareness of, and help prepare them for, the great opportunities that exist for trade with North America.

English Heritage Proposals for London
2.43 p.m.
Lord Bonham-Carter Lord Bonham-Carter asked Her Majesty's Government:
In the light of the report in The Times of 6th February, how the plans for London set forth in Managing England's Heritage are progressing.
Viscount Astor: My Lords, English Heritage has now sent its revised proposals to my right honourable friend the Secretary of State for National Heritage. These proposals take into account the responses to its consultation paper and are now being considered.
Lord Bonham-Carter: My Lords, while thanking the noble Viscount for that Answer, is he aware that the advisory committee which met on 6th February, or shortly beforehand, turned down flat the proposals of Managing England's Heritage and that that rejection was agreed by the commission itself? Therefore, have the redundancy notices issued to the skilled staff of the London division been withdrawn? If not, how is English Heritage to carry out its responsibilities now that it is clear that the vast majority of the London boroughs are neither willing nor able to carry out the work which would have been imposed on them?
Viscount Astor: My Lords, the purpose of the public consultation is to enable proposals to be looked at further in the light of comments received. English Heritage has done that. Its proposals have always recognised that the needs and capacities of boroughs vary greatly. Its revised plan, endorsed by its London advisory committee and by the commission itself, makes clear the level of service agreement to be negotiated between English Heritage and each borough. The noble Lord also asked about staff redundancies. Fifty-nine early retirements and severances have been agreed for London and 179 elsewhere. They include 95 direct-labour staff.
Lord Finsberg: My Lords, does my noble friend agree that it is important that work proceeds very quickly in this field and that it is fortunate that we have a man of the ability, drive and determination of Mr. Jocelyn Stevens who is now running English Heritage?
Viscount Astor: My Lords, I agree with my noble friend that the matter is important. English Heritage has come up with some new proposals. We shall study them carefully with the Department of the Environment. I can assure your Lordships that we shall need to be satisfied that they make proper provision for safeguarding London's architectural heritage.
Lord Morris of Castle Morris: My Lords, will extra funding be made available for the London boroughs if and when they take on responsibilities for local monuments? If so, how will that be reflected in the standard spending assessments?
Viscount Astor: My Lords, funding will be a matter between English Heritage and the London boroughs. English Heritage will continue to be involved in all
216
strategic policy issues. It will provide expert support and advice to the boroughs. It will continue to be involved in all casework for Grade I and Grade II star listed buildings, and in all cases involving total or substantial demolition of Grade II buildings.
Lord St. John of Fawsley: My Lords, is my noble friend aware that the Royal Fine Art Commission is deeply grateful to the London division of English Heritage for its work in preserving historic buildings in the capital? Does he agree that we should deeply deplore any undermining of its position, authority and powers?
Viscount Astor: My Lords, London has over 15,000 listed building entries, which is 3.5 per cent. of the English total. It has twice the national average in Grade I and Grade II star listed buildings. It is essential to ensure that the boroughs are fully involved in conservation as an integral part of planning, together with district councils in the rest of the country. English Heritage's latest proposals are aimed at trying to find a sensible balance.
Lord Jenkins of Putney: My Lords, is the noble Viscount aware that I share the disquiet expressed by the noble Lord, Lord St. John of Fawsley? Will the Minister discourage the London section of English Heritage from committing suicide which seems to be part of the plan at the moment? Is he not aware of the fact that this is another example of how much we miss the GLC?
Viscount Astor: My Lords, the noble Lord may miss the GLC, but I do not believe that many of the rest of your Lordships do. We recognise that London has special features. It is essential that the boroughs are fully involved in conservation. The English Heritage proposals seek a new balance in that area.
Lord Underhill: My Lords, can the Minister say what action has been taken as regards the decision reached by English Heritage to charge the organisers of the London Marathon an exorbitant sum for the use of parks? Is that not going to hit the charity appeal which the marathon makes?
Viscount Astor: My Lords, the point that the noble Lord makes has nothing to do with English Heritage.
Lord Bonham-Carter: My Lords, will the Minister say whether the so-called revised plan which has been submitted by English Heritage will be published so that we can see it? Can he also say whether any consultations had taken place with the bodies and the boroughs before the plan was revised in contrast with the absence of consultation which was a mark of the earlier document?
Viscount Astor: My Lords, there has been full consultation with everyone involved. The reason why English Heritage first published a strategy document was to enable it to have something to consult upon.
Lord Bonham-Carter: My Lords, will the revised plan be published?
Viscount Astor: My Lords, we shall have to see when the final proposals are agreed with the Secretary of State.

Railcard Schemes and Privatisation
2.59 p.m.
Lord Stallard Lord Stallard asked Her Majesty's Government:
What assurances they can give that railcard schemes will be maintained by private rail operators after the semi-privatisation or commercialisation of the railways.
The Minister of State, Department of Transport (The Earl of Caithness): My Lords, we are sure that private sector operators will also want to offer discounts on tickets in order to attract more passengers. These may either be based on the existing railcards or be new initiatives.
Lord Stallard: My Lords, I thank the noble Earl for that reply. He must accept that it is a very disappointing reply to those people who have been reading recent reports about the Government's intentions under their privatisation proposals. It is quite obvious that if no pressure is to be put—and it is said that no such pressure will be put—on the new operators to continue rail and travelcards, then there will not be any. Is the Minister aware that this situation has already angered millions of people who have benefited from these two provisions, particularly in London? Is he further aware that SAGA has already said that to end these provisions will mean that thousands of elderly people, youngsters and schoolchildren, will be unable to afford any holidays at all?
The Earl of Caithness: My Lords, these are commercial arrangements. They are not required by law from British Rail. I have no doubt that the private operators will be just as keen as British Rail to attract passengers.
Lord Boyd-Carpenter: My Lords, is my noble friend aware that many of us have seen with pleasure that the noble Lord, Lord Stallard, has understood what is being done about the railways by using in his Question the term the "commercialisation of the railways"? Will my noble friend congratulate the noble Lord on his somewhat belated understanding of what is happening?
The Earl of Caithness: My Lords, I am sure that the noble Lord, Lord Stallard, is looking forward to receiving the Bill and to discussing both it and the benefits that it can bring to British Rail.
Lord Tordoff: My Lords, would that the Government understood what is happening. However, to return to the Question on the Order Paper, how will it be possible to ensure a form of railcard for universal use across the whole of the network if there is no network?
The Earl of Caithness: My Lords, there will be methods by which the private operators will wish to
218
ensure that there are railcards that can be used throughout the rail network because of the benefits of getting more passengers onto the railways.
Lord Rix: My Lords, in view of the welcome assurance that the disabled person's railcard will continue, can the Minister give further assurances that facilities, services, access and egress to both trains and railway stations right across the board in this mixed economy will be assured for the 6.5 million disabled people once the new arrangements come into being?
The Earl of Caithness: My Lords, the noble Lord is right to highlight the question of railcards for the disabled. We have made it absolutely clear that we will impose that requirement on the franchise operators. Consequent upon that—as the debate in this House the other day showed—access for the disabled is also very important.
Lord Clinton-Davis: My Lords, is it not clear that, with the fragmentation of a national railway system, railcards, rail warrants, through ticketing and even a national timetable must all be in jeopardy? Does not the Minister recognise, therefore, that he is in no position at this stage to give a clear assurance unless a statutory undertaking to that effect is imposed upon the privatised companies? Do not the Government recognise that there is an important social service component in the running of our railway system which, apparently, they seek to avoid at every chance?
The Earl of Caithness: My Lords, the noble Lord is quite wrong. The social services aspect is highlighted by the enormous grant that British Rail receives. There is substantial room for improvement in the running of the railways which, as my noble friend Lord Boyd-Carpenter pointed out, can be achieved through the involvement of the private sector. Perhaps I may remind the noble Lord that there will be a national timetable and there will be through ticketing.
Lord Ennals: My Lords, did I understand correctly from the Minister that there will be legislation and that he can give an absolute guarantee that there will be statutes that will require all the private undertakings to fulfil those social obligations? I did not fully understand the degree of commitment in his Answer.
The Earl of Caithness: My Lords, to be absolutely precise, the degree of commitment goes as far as the disabled person's railcard. We intend to ensure that all franchise operators will be obliged to offer common discounts to disabled people.
Lord Underhill: My Lords, the noble Earl has referred to only one particular travelcard. Does he not recognise that his answers are the same as the hopes and expectations in the White Paper? Will there be a statutory obligation on the franchise operators to continue all the present types of discount cards? If so, how will that be enforced? If it cannot be enforced, what redress will there be for passengers?
The Earl of Caithness: My Lords, no. These are commercial arrangements. It will be up to the private operators—just as it is up to British Rail which

219
introduced the railcards in the first place—to encourage people to use the railways. Let me make it clear that what is different is the position of the disabled person's railcard, as I said to the noble Lords, Lord Rix and Lord Ennals.
Lord Ennals: My Lords, why can the Minister give an assurance on behalf of disabled people but not on behalf of elderly people? If he can give one assurance, why can he not give the other?
The Earl of Caithness: My Lords, we thought it particularly important to highlight the question of the disabled person's railcard. I should have thought that that would be welcomed by the noble Lord.
Lord Clinton-Davis: My Lords, is it not clear from the Government's own document of January this year that what is happening in relation to the disabled person's railcard is that the Government are seeking a public relations exercise rather than anything else because those arrangements will not be very costly? I repeat the question that was asked by my noble friend Lord Ennals: why cannot the Government give assurances in other regards? If it is simply a question of the commercial judgement of these companies, no assurance can be given by the Minister.
The Earl of Caithness: My Lords, the noble Lord is using a weak argument when he says that the help that we are giving to disabled people is a PR exercise.
Lord Stallard: My Lords, perhaps I may return to the question asked by the noble Lord, Lord Tordoff, and to the Minister's answer. Does he accept that in the same document as that referred to by my noble friend Lord Clinton-Davis—the Department of Transport's document on privatisation—it states that train operators cannot be expected to sell tickets for services other than their own because this,
"runs contrary to commercial interests"?
That is the reply that the Minister should have given to the noble Lord, Lord Tordoff, because that is the true situation. The document then states that private operators might choose to retain railcards for the disabled,
"for the public relations benefit".
Those are the facts according to the department's document. If the Minister had repeated those, we should all understand what we were about.
The Earl of Caithness: My Lords, I know that the noble Lord will have followed with care what has taken place in another place both on Second Reading and in the Committee stage of the Railways Bill. The position is very clear. There is a commitment so far as the disabled person's railcard is concerned. I am sure that private operators will seek to increase the number of people travelling on the railways.

European Autonomous Regions
2.56 p.m.
Lord Hylton Lord Hylton asked Her Majesty's Government:
Whether they will study the possibility of amending Article 227 of the Treaty of Rome so that Scotland, Wales and Northern Ireland could become European Autonomous Regions.
The Earl of Caithness: My Lords, no.
Lord Hylton: My Lords, does the Minister accept that Scotland, Wales and Northern Ireland would benefit greatly from democratic responsibility for their own internal affairs, leaving the United Kingdom to see to their defence and foreign affairs?
The Earl of Caithness: My Lords, with respect to the noble Lord, that is a different Question from that on the Order Paper. The noble Lord asked about European Autonomous Regions in his Question, and there is no concept of European Autonomous Regions.
Lord Renton: My Lords, does my noble friend agree that it would be utterly unconstitutional to grant to the European Community the power to force autonomy upon various parts of the United Kingdom when our own constitution, after mature consideration over many years by Parliament, does not do this? Is my noble friend aware that in the late 1970s the people of Scotland and the people of Wales had the chance to vote for or against executive devolution and they voted against it?
The Earl of Caithness: My Lords, I recall exactly the position in the late 1970s of which my noble friend so rightly reminds the House. It is entirely for this Parliament to determine the constitution of the United Kingdom.
Lord Mackie of Benshie: My Lords, the noble Lord, Lord Renton, is quite wrong. The people of Scotland did in fact vote by a narrow margin for the rather bad Bill which was introduced. However, is the Minister aware that the Secretary of State for Scotland is alleged to be studying the whole question now? When will he report the results of his alleged thinking?
The Earl of Caithness: My Lords, that is another question.
Lord Ewing of Kirkford: My Lords, is the Minister aware that, as the noble Lord, Lord Mackie of Benshie, has just said, the noble Lord, Lord Renton, is wrong in saying that in the late 1970s the people of Scotland voted against executive devolution? In fact, the majority of people voted for executive devolution in that referendum but were denied it because of the 40 per cent. rule which was imposed by the other place at the time of the passage of the legislation.
Turning to the Question on the Order Paper, does the Minister, as I do, find it a strange Question? Surely if Article 227 of the Treaty of Rome were to be amended not only would Scotland, Northern Ireland and Wales become European Autonomous Regions but ipso facto England would become a European

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Autonomous Region also. Does the Minister agree that we can do without such manifestations of nationalism when we see what is going on in the name of nationalism in other parts of Europe?
The Earl of Caithness: My Lords, we have to be careful about nationalism in the respect to which the noble Lord so rightly draws our attention; but as there is no concept of European autonomous regions in the Treaty of Rome, it would be a bad thing for Scotland, England or Wales to go down that route.
Lord Mason of Barnsley: My Lords, is the Minister aware that I am pleased that he is not treating this Question seriously? Are not Wales, Scotland and Northern Ireland mere principalities of the United Kingdom? What of the heart of the United Kingdom, the fulcrum of the nation—
A noble Lord: My Lords, Yorkshire!
Lord Mason of Barnsley: My Lords, yes, Yorkshire. Is the Minister aware that if serious consideration were being given to this matter, on the basis of population, agriculture, steel and coal, Yorkshire itself would be the most autonomous and well-deserved region of the United Kingdom?
The Earl of Caithness: My Lords, I am proud to be a member of that part of the world known as the Kingdom of Scotland, which is not a mere principality. As the noble Lord will know, the eyes of the world were not focused on Yorkshire on Saturday, they were focused on Murrayfield, and what an excellent result!
Lord Richard: My Lords, I would rather be in a mere principality than in a mock Yorkshire region. If the Minister rejects the suggestion contained in the Question—I can understand why he is rejecting it—will he tell us what steps are being taken to ensure that Scotland, Wales and Northern Ireland are represented adequately on the Committee of Regions which is proposed in the Treaty of Maastricht?
The Earl of Caithness: My Lords, as the noble Lord will be aware, there has been considerable discussion in order to get that representation right; but over and above getting right the representation on the Committee of Regions, he will also know that considerable discussions take place within government to ensure that the views of the people of Scotland, Wales and Northern Ireland are taken into account. The Secretary of State for Scotland attended the recent joint Environment and Transport Council.
Lord Renton: My Lords, may we try to get this matter straight?
Noble Lords: No!
Lord Renton: My Lords, we should try to get straight what the people of Scotland and Wales did or did not do in the late 1970s. Were they not given by Parliament the opportunity to vote for devolution, and they failed to achieve that purpose?
The Earl of Caithness: My Lords, it would be wrong to digress too deeply into that subject because it is not the Question on the Order Paper.
Lord Stoddart of Swindon: My Lords, is not there contained in the Question an implicit insult to the nations of Wales and Scotland, because, after all, they are nations and have been nations for a long time? I believe that the people would object to becoming European autonomous region persons rather than Welshmen, Englishmen or Irishmen. Will the Minister confirm, as my noble friend said, that England would also become an autonomous region? Would that autonomy mean that the subsidies which are paid at the moment by England to Scotland, Wales and Northern Ireland would cease?
The Earl of Caithness: My Lords, the ingenuity of the noble Lord on these questions knows no bounds. I give him full marks for that question, but it is slightly wide of that on the Order Paper.
Lord Tordoff: My Lords—
Lord Hailsham of Saint Marylebone: My Lords—
The Lord Privy Seal (Lord Wakeham): My Lords, I think the next question should come from my noble and learned friend.
Lord Hailsham of Saint Marylebone: My Lords, will my noble friend take note of the fact that there are some of us who are proud to be plain British?
The Earl of Caithness: My Lords, my noble and learned friend is right. I am sure that we all are.
Lord Tordoff: My Lords, is it not also acceptable that the English, Scots, Welsh and Irish are all Europeans?
The Earl of Caithness: My Lords, that, too, is true.
Lord Stewartby: My Lords, will my noble friend confirm, unequivocally, that if at any stage any change were to be made in the relationship between the component parts of the United Kingdom, it would be improper if such change were contemplated or implemented through the European Community, and that it would be entirely a matter for the United Kingdom Parliament?
The Earl of Caithness: My Lords, yes. My noble friend is right; it is a matter for Parliament.
Lord Hylton: My Lords, regardless of the method, do all of us not now need porous frontiers which allow the local identity to be enjoyed within European union?
The Earl of Caithness: My Lords, I do not believe that there is any doubt that the Welsh, the Scots and the Irish will continue to play an enormous part in their own right.

Medical Ethics: Select Committee
3.6 p.m.
The Chairman of Committees (Lord Ampthill): My Lords, I beg to move the Motion standing in my name on the Order Paper.
I shall move the Motion formally, then perhaps the noble Lord, Lord Stallard, may care to move his amendment. Other noble Lords may also wish to speak. I must apologise to the House for the fact that I was prevented by illness from attending the Committee of Selection last week. I am grateful that the noble Lord the Leader of the House has agreed to reply to your Lordships. I beg to move.
Moved, That, as proposed by the Committee of Selection, the following Lords be named of the Select Committee—

L. Colwyn,

B. Flather,

L. Hampton,

B. Jay of Paddington,

B. Llewelyn-Davies of Hastoe,

L. McColl of Dulwich,

B. McFarlane of Llandaff,

L. Meston,

L. Mishcon,

L. Mustill,

L. Rawlinson of Ewell,

L. Walton of Detchant, (Chairman)

B. Warnock,

L. Abp. York.

That the Committee have power to adjourn from place to place;
That the Minutes of Evidence taken before the Committee from time to time be printed and, if the Committee think fit, be delivered out;
That the Committee have power to appoint Specialist Advisers;
That the Committee do meet on Tuesday 9th March at half-past ten o'clock in Committee Room 4B.—(The Chairman of Committees.)
Lord Stallard Lord Stallard moved, as an amendment to the above Motion:
In line 1, leave out from ("That") to end of line 16 and insert ("the membership and chairmanship of the Select Committee be reconsidered by the Committee of Selection").
The noble Lord said: My Lords, it is with some trepidation that I move the amendment standing in my name on the Order Paper, because I realise that this is not a normal process; it is not something that happens all the time. I realise too that I shall be taking a few minutes out of the time available for an extremely important debate. Nonetheless, I feel strongly enough about the subject to want to ask the noble Lord the Chairman of Committees one or two questions about the committee.
My first reaction when I read the list of members and the report was that the committee was too big. As a result of my committee experience in the other place and elsewhere, I have found that a committee of 14 members may be difficult to handle in normal times. On a subject as important and controversial as this, I
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can imagine how hard it will be to manage a committee of the size proposed. With co-options, it will be even bigger.
I wondered how the Committee of Selection arrived at the number of members and decided who should serve. How many people volunteered to be members of the committee? How many were rejected? And what criteria were used to reject them? I looked more deeply into the membership of the committee. The last Question on the Order Paper and the replies to it a few moments ago helped me, because I am worried about the lack of representation from what some might call the principalities. There is a lack of representation from Scotland which has its own legal system. That is important. And there is a lack of expert legal advisers and of experts within your Lordships' House. They are not represented on the committee: that seems to me an omission.
The same goes for some of the other regions mentioned earlier. In particular I have had correspondence—I am not speaking of special friends of mine—from Northern Ireland. They resent the fact that they do not seem to be represented, that their voice will not be heard and that their views will not be put to the committee. I am worried about the lack of regional representation on the committee.
I considered the chairmanship of the committee. I cast no aspersions on the noble Lord who has been nominated as chairman. To appoint a medical man as chairman of a committee considering an extremely delicate subject in which there is bound to be tremendous public interest—there already is—was not, I felt, quite the thing to do. We need medical opinion on the committee; that is obvious. I am not too happy that it is in the chair. There are a number of excellent chairmen —I have noticed them in your Lordships' House over the past few years —who could have been appointed chairman of the committee and who would have aroused no questions. Therefore, I question whether it is wise to make a medical man chairman of such a committee.
Finally, I express an interest because I am involved in the hospice movement. I share the anxieties related to me by members of that movement as regards the whole debate, how and where they are involved, who will speak for them and what will happen. I feel sufficiently strong about the matter to raise it, and I hope that the committee will do nothing to deepen the fears and anxieties of the people I have mentioned. Those people are not represented on a committee whose decisions will affect everybody in the country. I beg to move.
Lord Boyd-Carpenter: My Lords, the noble Lord, Lord Stallard, is perfectly entitled to express his views about the recommendation of the Committee of Selection. Indeed, it is salutary that the Select Committee, like others of your Lordships' House, should know that its recommendations are likely to be questioned in this House. For that reason, I am glad that the noble Lord, Lord Stallard, has intervened. My difficulty is that on this occasion, although perhaps not on others, the Committee of Selection appears to have done rather well. The Select Committee appears to be just about right to deal with

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an infinitely delicate, sensitive and controversial question. The Committee of Selection seems to have got it right, and it is right that somebody should say that.
I disagree with the noble Lord, Lord Stallard, in objecting to the fact that the recommended chairman is a medical man. The subject is deeply medical. It is one about which many of us hesitate to speak because we are conscious of our ignorance of matters medical. It is an excellent idea to have in the chair a distinguished and able Member of this House who happens to be a qualified doctor. I hope that when noble Lords have expressed their views they will on this occasion say that the Committee of Selection has got it about right.
Lord Macaulay of Bragar: My Lords, I come from neither a region nor a principality; I come from a nation known as Scotland. Scotland is completely unrepresented on the committee. The Act of Union of 1707 preserved the Scottish legal system, and medical ethics and legal issues go together hand in hand. It is wrong that Scotland should not be represented on the committee.
I do not speak for myself—I do not seek a place on the committee—and I do not care who is a member of the committee to represent Scotland. However, someone should be appointed as a member to represent the interests of Scotland.
Lord Henderson of Brompton: My Lords, I agree entirely with what was said by the noble Lord, Lord Boyd-Carpenter. It is also within the right of the noble Lord, Lord Stallard, to raise the matter in this House, and it is indeed salutary that that should be done from time to time. However, on this occasion I believe that the Committee of Selection has got it right. Perhaps I may refer to what was said by the noble Lord the Leader of the House when he moved the terms of reference for the setting up of the Select Committee. He said that it should be:
"a forum for serious and thoughtful consideration".— [Official Report, 16/2/93; col. 992.]
I suggest that it does not matter from where in the United Kingdom one originates. What does matter is that the right balance is achieved between legal representation, medical representation and ethical, philosophical or theological representation. All are represented on the Select Committee and the party balance is just right. The committee will have a difficult function in dealing with such a sensitive subject and I suggest that we agree to what is proposed.
Baroness Robson of Kiddington: My Lords, I am delighted that the noble Lord, Lord Walton of Detchant, has been appointed as chairman of the committee. I find it difficult to understand the objection to the committee raised by the noble Lord, Lord Stallard. He said that the committee is too large and that 14 people are too many. One cannot say that while in the same breath saying that various interests should also be represented on the committee. If the noble Lord had his way the committee would be double its size.
3.15 p.m.
Lord Richard: My Lords, perhaps I may comment as a member of the Committee of Selection. It is not often that I am in such agreement with the noble Lord, Lord Boyd-Carpenter, but on this occasion I am. The area of inquiry is difficult and delicate. The Committee of Selection set about its task by trying to choose as sensible a group of Peers as it could find in this House whom it thought would be capable of doing the job. If ever there were a subject which your Lordships' House is uniquely qualified to examine it is precisely this.
It struck me from the outset that given the nature of the inquiry it would be a positive advantage to have a medical rather than a non-medical chairman. The issue intimately affects doctors in some of the most sensitive decisions that they must make. Members of the Committee of Selection tried to choose Members of your Lordships' House who could make a major contribution to the work of the Select Committee and would inquire into the subject in an objective and open-minded way. I believe that it has succeeded. I did not look at the task on the basis that the Select Committee should comprise of one or two Welshmen, one Ulsterman and one or perhaps two Scots. The issues involved are national and the "nationality" of the individual members matters little. I hope that the House will consider that the Committee of Selection achieved its aim, which was to choose a balanced committee of people who are well-qualified to do the job.
Lord Tordoff: My Lords, as a member of the Committee of Selection I support what has been said by the noble Lord, Lord Richard—
Lord Stoddart of Swindon: My Lords—
Noble LordsOrder, order!
The Lord Privy Seal (Lord Wakeham): My Lords, I believe that the noble Lord, Lord Tordoff, should speak first and then the noble Lord, Lord Stoddart.
Lord Tordoff: My Lords, I am grateful. Perhaps I may deal with one or two of the points which were properly made by the noble Lord, Lord Stallard. If the noble Lord, Lord Molloy, wishes to intervene perhaps he will stand up to do so and not speak from a sedentary position.
Lord Molloy: My Lords, my noble friend Lord Stoddart tried frequently to speak. The noble Lord, Lord Tordoff, has spoken once before. In my judgment that is somewhat unfair.
Lord Tordoff: My Lords, I did not hear myself speak once before but others may have done so. I was congratulating the noble Lord, Lord Stallard, for having raised the matter in your Lordships' House. It is wise that the issue should be raised and discussed because, clearly, it is one of considerable emotion. A whole spectrum of views is held on the subject. Your Lordships' Committee of Selection took that into account when drawing up a list of Peers to serve. The noble Lord, Lord Stallard, rightly said that the committee is too large. Indeed, the Chairman of Committees made that point to the Committee of

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Selection. There are 14 members rather than the usual maximum of 12 members because it wanted to accommodate as many views as possible on the committee.
This is not a subject on which anybody is neutral. It is difficult for anybody to be impartial about it. I remember when I first became a magistrate in the fair city of Manchester many years ago, we were lectured on the subject of prejudice. We were told that we all have prejudices but that it is important to identify those prejudices and then to isolate them when making decisions. I do not know what are the prejudices of the noble Lord, Lord Walton of Detchant, although I am sure he has some. I am sure that he is capable of isolating those prejudices so that he will act impartially as chairman of the committee.
Of course the hospice movement is very important as regards this issue. That movement will be able to give evidence to the committee, to which I am sure noble Lords on the committee will listen with great care.
Lord Stoddart of Swindon: My Lords, I wish to support my noble friend Lord Stallard. He has raised an extremely important point as to whether, first, the committee is too large and whether it is properly representative. This is a matter of ethics and morals. It is also very much a matter of religion. I see that the most reverend Primate the Archbishop of York is to be a member of the Select Committee but I see nobody who is an obvious Catholic.
Noble Lords: Rawlinson.
Lord Stoddart of Swindon: My Lords, thank you. Your Lordships have put that matter right. I should have thought that from the point of view of the Jewish religion we should have invited the noble Lord, Lord Jakobovits.
Lord Mishcon: My Lords—
Lord Stoddart of Swindon: My Lords, my noble friend Lord Mishcon is not a priest and it is on the basis of being representative that I mention the name of the noble Lord, Lord Jakobovits. Therefore, it is essential that religious interests should be properly represented on the committee.
There is one other point that I should like to raise and perhaps the noble Lord the Leader of the House will answer this. The committee will have the power to appoint specialist advisers. I presume that a manifold number of points of view will be taken into account when specialist advisers are appointed so that the committee may be advised as to every aspect of this important and complex issue.
Lord Ashley of Stoke: My Lords, I rise to support my noble friend Lord Stallard on one issue; that is, that a medical man is the last person who should be chairman of such a committee. Although we need the medical point of view—that is of vital importance—medical people are trained to preserve life at all costs. That is one of the issues to be discussed by the committee. Therefore, to have a doctor as chairman of the committee is to presume and to take for granted
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the end result of the committee's deliberations. I am not impugning the noble Lord in any way. He can play a very important role. However, I do not believe that a medical man should be chairman of this committee. I mention only that caveat.
The Earl of Halsbury: My Lords, we have heard whom it should not be. Who else should it not be? It may said that it should not be a lawyer, a theologian, a Welshman, a Scotsman or an Irishman. The chairman of the committee will be someone, some member of a profession.
Lord Rees-Mogg: My Lords, I am grateful to the noble Lord, Lord Stallard, for moving this amendment which I support. The problem is much more difficult than is widely recognised. Basically it seems to me that it is a problem of whether the balance of representation is reasonable and correct between those who have a commitment to the preservation of human life in all circumstances and those who have no such commitment.
It is obviously a matter on which there has been a lot of perfectly legitimate lobbying. To give your Lordships some idea of the lobbying which has taken place I shall read the comment of the Voluntary Euthanasia Society when the first announcement of the existence of the committee was made:
"This exciting news is a great step forward. At this stage there is no news on the composition or terms of reference of the House of Lords ad hoc committee on euthanasia but the Voluntary Euthanasia Society will be watching its progress very carefully indeed".
It is extremely important that there should be a balance between those who share the views of the Voluntary Euthanasia Society, or who are open to share those views, and those who are opposed to them. If there is no such balance—and in my view there is no such balance on the committee as established—the committee will not enjoy the confidence which it needs. It will be a waste of time because people will reject the findings of the committee before it has reported. That is a real difficulty.
Noble Lords: No.
Lord Rees-Mogg: Your Lordships may say "No", but it is a difficulty. The question is whether the balance is right. I was not chosen to join the committee, about which I felt some relief. I have made inquiries about the mode of selection. The view was taken, which at first sight is perfectly reasonable, that noble Lords who have an open mind should be chosen to sit on the committee. As I understand it, 12 noble Lords, many of them very distinguished, with varying religious views, took an anti-euthanasia point of view. Of those, two have been appointed to the committee, one very much at the last moment.
I have been informed that that was done because it was felt that those noble Lords did not have an open mind on the issue and, as I say, it was felt to be essential that noble Lords sitting on the committee should have an open mind. But what is an open mind on this subject? If you have an open mind on euthanasia, you already concede that in certain circumstances euthanasia may be justified. Therefore, the great majority of the members of this committee

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concede that euthanasia may be justified and only a small minority are determined to preserve life in all circumstances. Therefore, as a result of that this is not a balanced committee.
A last illustration can be given of that point. Another issue of life and death which has been much discussed in this House, although not recently, is capital punishment. Some people are opposed in principle to capital punishment and some have an open mind on the subject. If you have an open mind, that means that you are sympathetic to the idea that it may be desirable in certain circumstances. I support the amendment.
Lord Jenkins of Putney: My Lords, it was not my intention to speak on this matter but I am an open proponent of euthanasia and, as far as I am aware, that voice has not yet been heard. At first I was wholly opposed to the committee because it seemed to be completely hostile and against the idea of euthanasia altogether. What I have just heard from the noble Lord, Lord Rees-Mogg, seems to be an absolute travesty of the facts. However, in view of what the noble Lord has said, I withdraw my objections because, to say the very least of it, the committee must be impartial.
Lord Grimond: My Lords, I wonder whether the noble Lord the Leader of the House will be good enough to answer the question posed by the noble Lord, Lord Macaulay. The committee does not represent different parts of the country. But on the face of it, without an explanation it seems rather odd that on this important matter Scottish judges and Scottish law are not represented.
Lord Simon of Glaisdale: My Lords, members are not appointed to this or any other Select Committee to represent any particular interest. Therefore, any talk of a balance of interest is to that extent misconceived. As the Leader of the Opposition said, they are appointed because they can bring qualities of judgment and experience to an extremely difficult issue.
I very much hope that when we have set up this committee with its difficult task, and with some urgency, we shall send it on its way with good will by showing confidence in the Committee of Selection.
3.30 p.m.
Lord Wakeham: My Lords, the matter of appointing committees, as of their terms of reference, is one in which I am in the hands of the House. To that end, the House has appointed the Committee of Selection to exercise those duties of appointing members on its behalf. The importance which your Lordships attribute to this committee and its inquiry is well attested by the number of noble Lords who made known, either to the noble Lord the Chairman of Committees or to the Whips, their willingness to serve on the committee. As your Lordships will realise, it has not proved possible to accommodate them all.
However, it appears to me that the proposals which the committee is now making to your Lordships' House for the membership of the committee provide
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an excellent balance between all the shades of opinion on these issues which are represented in your Lordships' House. What is equally important is that the proposals, I suggest, achieve a sensible balance between representatives of the medical professions; representatives of the legal profession; those with particular expertise in looking at the difficult moral issues; and those whom I know will not be offended if I use the term laymen and women as regards this issue.
Three principal concerns have been expressed in this short debate. The first is that the committee is in some way unrepresentative or unbalanced in its reflection of the viewpoints and skills of your Lordships. As I have explained, I do not believe that is the case. I know noble Lords would not wish me to discuss the merits of individual members of the committee, but it seems to me there is strength in every name put forward by the Committee of Selection. Indeed the Committee of Selection was acutely aware of the need for all shades of opinion to be adequately represented on the committee. To that end it took the view that the committee should have a slightly larger membership than is usual for ad hoc committees. I should emphasise that in making its proposals the committee had regard to factors which go beyond the usual criteria of expertise and of party balance. The committee that is now proposed consists of four members of the medical professions, four lawyers, two members with specific experience of grappling with these medical and ethical issues and four lay members.
The second concern is that the committee should not be chaired by a doctor. No one, quite rightly, has said anything that reflects badly on the talents or the abilities of the noble Lord, Lord Walton of Detchant. He is in every way admirably qualified to serve on the committee. The question is solely one of whether it is appropriate for a doctor, who may be expected to have some familiarity with the range of issues likely to arise on the inquiry, to be appointed chairman of the committee. For my own part I have no doubt that it is wholly consistent with the practice of your Lordships' House to appoint as chairman of a committee someone with an extensive knowledge of the issues that are likely to arise. Indeed the weight which is accorded to reports of your Lordships' Select Committees is frequently attributable to the expertise of the members and the chairman. In this case the difficult issues which the Select Committee will need to consider cover three main fields: first, medical practice, patient care and developments in medical technology; secondly, the interaction between medical practice and the law, in particular the criminal law; and, thirdly, medical ethical and moral questions.
The common feature of all those areas is medicine. I therefore suggest to your Lordships that the appointment of someone with distinct medical experience as chairman of the Select Committee is wholly appropriate. While the committee will clearly need to look closely at aspects of the criminal and civil law—for that reason the Committee of Selection has proposed that four lawyers should be appointed to the committee—it is the medical theme rather than the legal theme which will predominate. I should perhaps add that the noble Lord, Lord Walton of Detchant,

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already has considerable experience of the work of Select Committees of your Lordships' House through his time on the Science and Technology Committee.
Finally, the noble Lord, Lord Stallard, has drawn attention to what he perceives as a regional imbalance in the membership of the committee. Apart from my noble friend Lord McColl of Dulwich none of the candidates before your Lordships' House today can, I think, claim to be Scottish, nor are any of them from Northern Ireland. But it has always been a principle of your Lordships' House that Peers do not represent any regional or geographic constituency. Moreover, should the committee feel that the different circumstances in Northern Ireland or in Scotland would justify taking evidence from Scottish or Northern Irish witnesses, either here or in Scotland or in Northern Ireland, then I can assure your Lordships that it has the power to do so. Indeed, it may be that, following the remarks of the noble Lord, Lord Stallard, the committee would feel that this is something it would wish to look at in some depth.
The noble Lord referred to the hospice movement. I have a family interest in that movement. I am sure he is right in saying that that is a matter the Select Committee will wish to look at. I hope that reassures the noble Lord and that he feels we have, in putting forward the names, taken seriously the concerns he has expressed. I hope he will not wish to press his amendment.
Lord Stallard: My Lords, I am grateful to all those who have spoken in this short debate and for the sentiments they have expressed. I am grateful for the comments of the noble Lord the Leader of the House. However, I must correct him on one point. I am not arguing for the appointment of a Scotsman, a Welshman or an Irishman, or for the appointment of any particular nationality to the committee. However, I wish to emphasise that there is no member of the committee who is representative of the Scottish legal system. That is an important point. There is no one on the committee who represents what is an important part of the United Kingdom's legal system. Despite what the noble Lord the Leader of the House has said, I still feel that that is an omission. I have listened to what has been said and to the opinions that have been expressed. I have made my point about what I consider to be an omission and I shall not press the amendment any further at this stage.
Amendment to the Motion, by leave, withdrawn.
On Question, Motion agreed to.

Government Policy: Economic and Social Consequences
3.36 p.m.
Lord Jenkins of Hillhead Lord Jenkins of Hillhead rose to call attention to the economic and social consequences of the policies of Her Majesty's Government; and to move for Papers.
The noble Lord said: My Lords, we live in rather extraordinary times. Hitherto, since governments became the creations of Parliament rather than the
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nominees of the Crown, if administrations reached a certain level of incompetence, or even of ill luck, they fell. Now, having achieved a unique series of policy disasters, the one principle which appears to unite those who preside over a demoralised nation is a determination to cling to office at all costs, both collectively and individually.
In our brave new Britain the honourable resignation has become as out of date as a balance of payments surplus or the elevation of service to the community over profit for the individual. Yet the Government are stuffed with Ministers who by the standards of more reputable periods would have felt that their usefulness was exhausted.
Of the Chancellor we need perhaps say nothing. Meanwhile even so proud a Minister as Mr. Heseltine, having completely misjudged his policies on pit closures, is now immobilised by a loss of nerve and merely waits for the Select Committee to tell him what to do. Even so pious a Minister as Mr. Gummer has been rebuked in a way that is crushing of dignity. Shame has been abolished as a political emotion and the result is an appalling decline of political standards and of the respect in which our political institutions and individuals are held. Presiding over this degenerating scene is the Prime Minister who is now entering his 28th month of office. That is already longer than four Prime Ministers this century. Recently I came across a comment made about Goderich by the Duke of Bedford of the day, Lord John Russell's father and the great great grandfather of my noble friend Lord Russell. Gladstone had described Goderich as the man who knew least about finance who was ever head of the Treasury. Bedford's comment was more quietly damning. He simply said that Goderich was a good-natured and good-humoured man but totally unfit to be Prime Minister. At least Goderich lasted only for five months whereas we have the unique combination of a despairing population and an enduring government.
I cannot but feel that it is a considerable criticism of the Official Opposition that a government of such manifest incompetence should be able to get away with no resignations and no great threat of replacement. At last a by-election is pending, the reason for which we all greatly regret. It is in a constituency which is a good mixed cross-section of southern England. It includes some agriculture, with some modern hi-tech industry and a commuter belt, all centred around an expanding town which has absorbed a certain amount of London overspill, the whole suffering heavily from the recession. Yet who would deny that a likely outcome is that the Government will lose their seat and the Official Opposition will lose their deposit? If that were to happen it would be a classic illustration of how ill our present political rigidity fits the needs of the country today.
That is one of the reasons for the appalling Gallup poll published in Monday's Daily Telegraph, which indicated that respect for Parliament has fallen from 54 per cent. to 30 per cent. over the past 10 years. Even respect for the Civil Service, after 14 years of one-party government and perhaps a little too much

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easy acquiescence in the prevailing ethos, has gone down by 10 points. The final irony is that the only institution for which respect has marginally increased, admittedly from a very low level, has been the trade unions. The Cinderella of the years of the noble Baroness, Lady Thatcher, has not exactly gone to the ball but it has in public esteem dusted a few ashes off its skirt. The final devastating answers to the poll show that only one in five see any hope of the situation improving and 70 per cent. of respondents see Britain's role as either a minor power in Europe or of very little influence outside. Forty-nine per cent. say that they would emigrate if they could.
Therefore, there is no doubt that the public perception of the objective circumstances which have followed from the policies are dismal in the extreme. How far are the Government responsible for the consequences? They are not entirely so, obviously. There are some underlying trends at work which have defeated not only the post-1979 Conservative hegemony but many other governments for a long time past. Yet there are some heavy indictments to be made.
The first is the sedulous peddling of the economic miracle of the 1980s. That was one of the more tawdry and dangerous confidence tricks ever inflicted upon a nation. The noble Lord, Lord Gilmour, is about to deliver a maiden speech, to which we all greatly look forward. This afternoon he may feel a little inhibited by the conventions of your Lordships' House of non-controversiality, even if those are not always observed. I hope that the noble Lord will not be too inhibited. However, if at the end of his speech anyone feels deprived of the full rigour of his analysis I recommend that they read the early chapters of his book Dancing with Dogma in which they will find the most brilliant and devastating analysis of the miracle claimed.
The fact is that there was no miracle. Our underlying competitive position did not improve and many of the seeds of our present misfortunes were then sown. If that were not so our present almost all-pervading troubles would be inexplicable. It is important to strip away the remains of the myth, not for reasons of political polemics, though that would be perfectly justifiable, but because until that hubris—which used to be so perfectly expressed in your Lordships' House by the voice of the noble Lord, Lord Young of Graffham, which like the voice of the turtle, is no longer heard in the land—is buried we shall not face the realities of the situation.
The second count of the indictment is the grave damage which was inflicted upon our manufacturing base in the recession of the early 1980s and which has since been exacerbated and not repaired. As a result we lack the industrial resources to benefit from the forced devaluation of last September. We lack the manufacturing strength to climb round a J-curve. The salient economic features of the past decade have been: first, the frittering away of the oil gush; secondly, the decline of manufacturing; thirdly, a run-down of our public infrastructure; fourthly, a massive shift in relative resources from poor to rich; and fifthly, a vast increase in private indebtedness with
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everybody up to their ears in debt. That has not been a recipe either for economic success or for social contentment.
The third count of the indictment is that just as the Government and their big sister predecessor propagated the myth that one did not need a manufacturing base provided one had enough oil and financial services, so they have propagated the equally false and still more dangerous doctrine that nobility —or at any rate virility—lies in the search for profit and private wealth while the public service occupations, from teaching and television to the Foreign Office, can be left to the wimps and the wets. The enterprise culture was first beatified and then undermined by a recession which destroyed its weaker votaries.
In my view that was a foolish philosophy for Britain even had the slump not made a mockery of it. It was foolish because everything at which as a nation we have been peculiarly good has been in the public sector: the Civil Service, the BBC, our universities, the Armed Forces, and our great tradition of voluntary public service extending from the magistrates' courts through Royal Commissions to local government when local government still had some real power. Except perhaps for retailing, property development and banking, for a hundred years we have not been particularly good at business. Even in those three sectors there has been a heavy reliance on immigrants and the descendants of immigrants. I therefore believe that a significant part of the collapse of our national self-esteem can be attributed to a misguided attempt to elevate the things at which we are not very good and to decry those in which not all that long ago we were the envy of the world.
The fourth count is the Government's relentless pursuit of dogma even in their otherwise rudderless condition. One of the factors which most disillusioned me with the Government of 1974–79 and which made me relieved to leave them in September 1976, was their pushing through Parliament in that year—a year of a reeling pound, although not reeling so much as it does today—the irrelevancy of ports nationalisation. That now strikes me as a peccadillo compared with inflicting railway and Post Office privatisation upon us. It is a mirror image of the disease which beset the Labour Party at the end of its 50 years as a party of government. Most did not believe in the doctrinaire nonsense but lacked the courage to say no to the few who did.
The fifth and perhaps the worst count on the indictment is the Government's relative indifference to unemployment and to the existence of a large and alienated underclass for which persistent unemployment is a big contributory cause. With only a brief intermission between 1987 and 1990 we have now had very heavy unemployment for 12 years—for much longer than in the 1930s—and even in the intermission unemployment was still substantial. The fact that both the 1983 and the 1992 elections could be won by a government with massive and rising unemployment

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was bad news for national cohesion when unemployment ceased to be the death knell for governments and became a death knell of opportunity for the most deprived areas of our cities.
I was brought up in one of the most depressed areas of the country in the 1920s and 1930s. The absolute poverty was greater, but in South Wales in those days there was not the deadening hopelessness such as is the lot of many in the inner cities today. There was educational striving. There was local prestige and esteem. There was hope. Those are all qualities which a combination of the Government's educational, social and economic policies have destroyed for a sizeable proportion of our population.
Now, as a culmination of those trends of a decade and more, we have the deadly knot of a recession which will not end, a balance of payments that will not balance, and a public finance deficit which is in the course of spiralling out of control. Even making the fullest possible allowance for changes in the value of money, no previous Government have ever produced anything approaching the lethal combination of 3 million unemployed, a £15 billion balance of payments deficit, and a £45 billion public sector deficit. It would be a unique achievement without the flow of North Sea oil. With it, it is a near miracle—but not the kind about which the noble Baroness, Lady Thatcher, and the noble Lord, Lord Young, used to proclaim.
How can we begin to escape from the vice which we have created for ourselves? There are some vital and difficult, but not impossible, economic feats of statesmanship which need to be performed. First, we need to give confidence that the public sector deficit will be brought under early medium-term control while not hitting on the head any long-delayed green shoots of recovery. The proof of President Clinton's pudding will no doubt be in the eating, but he has at least started baking it. That is better than veering without the slightest strategic vision from one lurch to another. We should not be ashamed to learn a little from across the Atlantic.
Secondly, we must get up investment and, above all, infrastructure investment which is the part over which Government have most control. Even after a massive devaluation, a consumption-led boom will go straight into a further collapse of the balance of payments, and such investment is desperately needed for its own sake.
Thirdly, we must get rid of the anti-tax and, above all, the anti-direct tax dogma. That has done a great deal of harm in the past five years in Germany, in the United States and in Britain. We should certainly be against taxation for its own sake, against vindictive taxation, and against excessive marginal rates. But we should not be against taxation when it can be shown to meet a clear national need. The time for that may not be in this Budget. However, the time will assuredly come if we are to get that public sector deficit under control and to bury the profligacy which has become such a characteristic of Conservative Chancellors.
Fourthly, we should throw what small influence we have left in Europe, as in the wider world, on the side
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of an international framework for recovery. It is much safer if we can do it together. It will not be easy to achieve but it is well worth trying. Nothing is easy when one has got into the mess which confronts us today. Almost anything would be better than the present weak and whining jumping from improvisation to improvisation which passes for the policy of Her Majesty's Government. I beg to move for Papers.
3.56 p.m.
The Earl of Caithness: My Lords, the Motion before us today promises a debate that will be both interesting and wide ranging, and the opening contribution from the noble Lord, Lord Jenkins of Hillhead, was, as always, interesting. The link between the social and economic effects of policy is clearly a strong one. A sound economy is the only basis on which to build affordable and effective expenditure on social programmes. It is clearly important that such expenditure is well targeted and efficiently managed. But the underlying fact remains that the nation cannot spend money it does not earn, and our economic performance is therefore the vital driving force underpinning all our efforts in the social arena.
Clearly, we have suffered a prolonged recession, and we fully recognise the very real social problems it has caused. But there is an important distinction between discussing the current state of the economy and discussing its underlying health. I do not propose today to discuss in great detail the Government's latest view on immediate economic prospects. The reason is already well known to your Lordships. A new report on the outlook for the economy will be revealed shortly by my right honourable friend the Chancellor of the Exchequer at the time of the Budget. I wish to say a few words on the Budget. It will be on 16th March. Having dwelt on that subject, let me return to the theme of my speech.
We believe that the essential elements for a sustainable recovery are now in place. We have low and falling inflation; the annual change in the retail prices index in the year to January was just 1.7 per cent. That is the lowest rate for 25 years. Retail price inflation has been below the EC average since August 1991 and is now below the average of the G7 countries too. Interest rates have been reduced by 9 percentage points since October 1990 to the lowest level in the EC and their lowest level for 15 years. That will have cut over £1 billion off industry's interest bill. Productivity is at record levels and towards the end of last year was rising at the fastest rate for over five years. Industry's unit labour costs are now rising more slowly than those of Germany and Japan. With the competitive edge of a lower pound, and with costs under control, industry is now well placed to expand.
My right honourable friend the Chancellor of the Exchequer announced in his Autumn Statement a number of measures designed to boost confidence. Those measures have recently been reinforced by a further cut in interest rates and recent indicators suggest that those measures have had some effect. In particular, there has been a marked recovery in business confidence which has been reflected in a number of opinion surveys over recent weeks. We are

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confident that, taken together, those factors carry the promise of the early resumption of growth we all wish to see.
I should like to concentrate today, however, on the underlying state of our economy and on its prospects over the longer term. I am sure that we can look forward to a lively debate about the implications of the changes that have occurred in our economy since 1979, but most noble Lords will agree that those changes have been fundamental and far reaching.
When we came to power in 1979 our economy was highly regulated, had high levels of public ownership and was afflicted by poor industrial relations and persistently high inflation. In all those areas we have seen fundamental change resulting from government policies that I believe have greatly enhanced the underlying strength of our economy.
We have seen the abolition of exchange controls and extensive financial deregulation that has given people far greater flexibility to order their financial affairs in the way best suited to their circumstances. I would not deny that both borrowers and lenders have faced some difficulties adapting to free capital markets. But I am convinced that that transitional period is now behind us and the long term benefits of greater freedom will become increasingly clear. Financial deregulation has ensured that the City of London has remained the predominant financial centre in Europe. The value of the City to this country is sometimes questioned, but it provides many jobs and makes a great contribution to our balance of payments, a net £4.5 billion in 1991. That Britain has led rather than followed in the move towards deregulation has done much to ensure its future.
We have also moved large sections of the economy from public to private ownership. That has involved some of our leading industrial companies such as British Steel, British Aerospace and Rover. It also included companies involved in the provision of key services such as British Telecom, British Airways and British Gas. It is important to note that, even today at a time of recession, all of the companies I have mentioned are seen as among the most efficient in their respective industries in Europe. British Steel is now widely seen as Europe's most efficient steel producer; BA—whose initials were once used to describe a somewhat unparliamentary term—has been consistently profitable after years of losses in the public sector. That is at a time while European state airlines have made losses. Maybe that is what noble Lords opposite prefer. And, despite the criticism levelled at them both, British Telecom and British Gas have increased efficiency to an extent that has allowed them to make substantial profits while also freezing, and in some cases reducing, their prices to consumers. No one seriously believes that that would have happened had they stayed within the public sector.
In the areas of industrial relations, inflation and poor performance, which came to be seen as key features of the "British disease" in the 1960s and 1970s, there has also been a transformation. Changed attitudes, reinforced by government reforms of industrial relations legislation, have led to a situation in which each of the past two years has set a new
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record low for the numbers of days lost to strikes in a series going back more than a century. Major new employers such as the Japanese car firms setting up in this country now find that they can count on a flexible and motivated workforce and co-operative unions. That would not have been the case in 1979 and without that change those major investments might well not have been made. Considerable credit is due for the constructive approach to inward investment now taken by the leadership of major unions.
We have also made progress towards losing our long held reputation as a high inflation economy. Under the last Labour Government our inflation rate averaged over 15 per cent. and peaked at nearly 27 per cent. I realise that higher oil prices contributed to that, but the fact remains that that performance was considerably worse than those of our main competitors. In the period since 1979 inflation has averaged 7 per cent., still too high but a considerable improvement. And more recently our inflation rate has been below the EC average for 18 consecutive months and has now fallen to its lowest level for 25 years. I am well aware of concerns that it will rise once more as the economy recovers. I will address that point presently. But it would be churlish for anyone to deny that this Government have not achieved a marked improvement in our inflation performance.
It is sometimes suggested that those developments were at the expense of weakening our industrial base. It is true that manufacturing output declined sharply in the recession of the early 1980s. But I believe that despite that we have seen a real strengthening of our industrial base and that the 1980s will still, in time, be seen as marking a crucial turning point in our industrial performance.
It is widely recognised that years of poor productivity growth, low investment and appalling industrial relations weakened our industrial base enormously over the 1960s and 1970s. The noble Lord, Lord Jenkins, spoke of the situation at the beginning of the 1980s. I believe that by 1979 the very survival of key sectors of our economy such as the motor industry was greatly in doubt. I am sure your Lordships remember that. It is worth noting that between 1972 and 1979 output of cars fell by 44 per cent., and output for export fell even more sharply. And that was during a period when domestic registrations were increasing. There is no doubt that the recession of the early 1980s hurt the motor industry, but it was also a catalyst to long overdue change.
The industrial relations problems that had made our motor industry notorious were finally tackled. The result was an industry that was smaller—output fell by a further 17 per cent. between 1979 and 1982—but also substantially leaner and fitter. That process inevitably involved a substantial fall in the level of employment in the industry, as productivity began to be brought into line with that of our major competitors.
The result, however, has been a renaissance that few would have believed possible in 1979. Output of cars is likely to rise over the rest of the decade to a point where it is expected by leading industry

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convention such as Professor Rhys of Cardiff Business School to comfortably exceed the record levels of the early 1970s by the end of the decade. And that increase will be accompanied by a substantial increase in car exports, which will make a significant contribution to our balance of trade. If few would have believed that possible in 1979 even fewer would have believed it in the winter of 1981, and that fact has lessons for our thinking today.
The motor industry was not the only one to emerge from the dark days of 1981 with a renewed vigour. The pattern of gradual but inevitable decline that had been followed by many of our largest firms was not the pattern of the 1980s. Firms such as GEC, GKN, TI, and Smiths Industries, have all become world leaders in key manufacturing areas. Let us not forget that in a recent Financial Times survey 11 out of the largest 20 companies in Europe by market capitalisation were wholly or partly British.
I would be the first to acknowledge that there were other industries that did not emerge from the early 1980s recession in that way. For some, that recession marked the end of the line and not a new beginning. But to blame that exclusively on the policies adopted in 1979 is to ignore reality. The demise of those industries resulted largely from the many years of steady but persistent decline that had gone before. Those were the years that tore much of the heart out of our industrial base. I am convinced that we would today have a manufacturing base that would not only be weaker but also smaller if radical steps had not been taken in 1979 to change attitudes and force industry to face up to necessary change.
The refusal of the Government at that time to bail out firms that were no longer viable caused industry to face up to problems that had been left unfaced for far too long. The power of the unions to hold management to ransom was challenged. Unproductive layers of management were themselves shed, and overmanning was greatly reduced. The result, inevitably, was a sharp rise in unemployment. High levels of unemployment, resulting to a significant extent from technological advance in the manufacturing sector, are a problem throughout Europe and to some degree the whole industrialised world. That is a problem to which a solution has yet to be found. But the solution is not, and never was, inefficient working practices and low labour productivity. These may lead to higher employment in the short term, but only at the expense of lower employment later on.
The years that followed the recession of the early 1980s saw very strong employment growth based on rapidly growing output and a transformed productivity performance. Over the 1980s as a whole manufacturing productivity growth in this country was the fastest in the G7 after two decades of being the slowest. I am not sure that it is widely recognised how profound and significant a change that represented. There is every reason to believe that that improved performance can be sustained. Even in the fourth quarter of 1992 manufacturing productivity growth had recovered to almost 6 per cent. That is a far better performance than we achieved at similar points in
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earlier cycles and suggests that there is the prospect of good productivity growth once the recovery becomes established.
I would also accept that the view held by some people in 1986 that all our problems had been solved was perhaps exaggerated—just as fears in 1981 that recession would prove never ending were, and just as similar fears expressed today will prove so. But they reflected a sense that for the first time in many years Britain was capable of building a better future rather than simply managing decline. With the benefit of hindsight, it is clear that by the summer of 1987, despite statistics recording continued low inflation, rising asset prices, particularly in the housing market, and the effects of financial deregulation, inflationary pressure was stronger than we realised. In the autumn of that year stock markets around the world experienced their worst crash for more than 50 years. In all industrialised countries attention switched from concerns about inflation to fears that the crash heralded the onset of a world depression like that experienced in the 1930s.
Here, as elsewhere, the response was a relaxation of monetary policy—and let us not forget that even greater relaxation was recommended by the party opposite. It later transpired that the effects of the crash were more limited than people feared, and our response left monetary policy too loose. The effects were particularly great in this country where we had enjoyed several years of strong growth, leading to the latent inflationary pressures I have already mentioned. Inflation rose sharply as a result and the Government had to act firmly to bring it back under control. Bringing inflation back down to its current level has involved a contraction of activity that I acknowledge has been prolonged and painful.
But the underlying strength of our economy cannot be judged by the level of output at any single time. It depends on our longer term performance which will ultimately be determined largely by supply side considerations. I do not wish to be drawn into speculation about when exactly the recovery will begin, or what rate of growth we will enjoy this year or next year. But I will say that the supply side improvements that took place during the 1980s remain intact. They have not been destroyed by the recession, only masked by it. When the recovery gets under way they will reassert themselves. I believe that the strong economic performance that that will bring about will allow us to take further the improvement in social provision that has already occurred since 1979. That improvement had already given us a record on social spending of which I believe we can be proud.
Earlier I spoke of the strong link between the social and economic effects of policy. Our effective management of the economy has meant that not only have we been able to maintain social programmes but we are able to continue to improve provision in areas which are important to all sectors of society.
The Government will be providing more than £1 billion extra for health services in England next year. That represents a real terms increase of 3 per cent. over original plans for 1992–93. Under this Government spending on the NHS has reached record

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levels. Total spending on the NHS in England has risen from £6.5 billion in 1978–79 to a planned £30.5 billion in 1993–94; this represents a real terms increase of over 61 per cent.
Central government's own spending on education in 1993–94 will be £9.5 billion. This represents a 5.8 per cent. increase on the equivalent expenditure in 1992–93. The 1993–94 local authority grant settlement allows for local education authorities in England to spend about £16.9 billion on education. These plans take account of the broad range of pressures facing the education service, the scope for efficiency savings, the Government's policy on public sector pay and what the country can afford.
Expenditure on social security has increased by over 52 per cent. in real terms since 1979. It now represents over one-third of total government spending. The Government plan to spend almost £80 billion in 1993–94 which amounts to over £10 per working day per working person. Expenditure on housing support has almost doubled in real terms since 1979. That has ensured that the benefit incomes of the least well off have been fully protected. Indeed, real terms comparisons show a steady improvement in benefit income for families between 1979 and 1988–89. The Government are maintaining that support. My noble friend Lord Henley announced in this House recently that all the main benefits will be uprated fully in line with prices in April this year at a cost of £2.5 billion.
We are naturally concerned about the level of unemployment. The recent rises in the number of unemployed are disappointing. Our priority is to help unemployed people find jobs. We are determined to do all that we can to ensure all individuals receive the help they need to get back to work as quickly as possible.
The Government are already spending over £2 billion per year on measures to help the unemployed. New measures for 1993–94 will mean almost 1.5 million places will be available on employment and training programmes—an increase of nearly 500,000 on this year. All this amounts to the most comprehensive range of help and advice ever available to unemployed people.
It is worth remembering that in the middle to late 1980s we had a job creation record that the OECD described as being by far the best among the larger EC countries. The key to repeating that performance is a return to sustainable growth. Achieving that is central to the Government's strategy. With low inflation, low interest rates and a lower pound reinforced by the measures in the Autumn Statement, we can look forward to a resumption of growth and to a combination of healthy growth and low inflation in the years ahead.
4.17 p.m.
Lord Richard: My Lords, we should all be grateful to the noble Lord, Lord Jenkins, for initiating the debate today. It is timely, in the sense that it is pre-Budget. He opened the debate with his customary elegance and perception, and he made some pointed remarks about everybody, including the Opposition. I am bound to say to him that having left the Labour
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Party, at the time, perhaps, of the Party's greatest travail, and having devoted the last 10 years to his diary, it is a bit rich for him now to complain of the performance of the Opposition. If he and his friends had perhaps stayed in the Labour Party, he might now be a little less critical. He must have expected it; he is a highly intelligent and experienced man. He could not expect that we on this side of the House would let him get away with what he said about us without some kind of response.
We listened to the noble Earl replying on behalf of the Government. I listened to him, as I always do, with interest. He could not have seen, because his back was turned, the enthusiasm with which the Benches behind him greeted his remarks. I say only one thing to him. This came from my noble friend the Opposition Chief Whip (and I give him credit for it). As the noble Earl sat down my noble friend turned to me and said: "Tell me, if things are so good, why are they so bad?"
It is not a bad question to ask at the end of 14 years of stewardship by the party opposite. Whatever else the Government can and cannot do at the moment, the one thing that they cannot do is blame this side of the House for the current economic position in which the country now finds itself. They are on their own. They have had the power to do things. They have had the authority to do them. For 14 years they have organised the economy in the ways that they thought the economy should be organised. What is the result?
Looking at the terms of the Motion, I resist the temptation to call attention to the economic and social consequences of the policies of Her Majesty's Government and ask, "What policies?", given the way in which the Government seem only able to respond to events and not to initiate them. This is certainly a subject that could be debated at enormous length. One has only to open a newspaper to see what the Government have done and continue to do to the British economy and, devastatingly, to the people of this country.
The party opposite has laid great emphasis on the role of the Prime Minister in formulating government policy. I understand that we have a new "ism", known as "Majorism". He must be prepared to accept responsibility for the economic and social ills which have befallen this country since he became Chancellor in October 1989. I have recently been studying an interesting document; namely, the Conservative Manifesto at the last general election. The Prime Minister himself, no less, wrote:
"The Government's duties are clear: to look after those who cannot look after themselves; to protect law abiding people from crime and disorder; to protect the value of our currency, without which all spending pledges are worthless and all savings are at risk".
Those are clear pledges, clearly expressed and specific.
What have the Government done to fulfil those pledges? One was "to protect the value of our currency". Last September saw the Government, overwhelmed by events on the foreign exchanges, introduce panic measures in an attempt to shore up sterling by huge interest rate rises. As we know, those attempts were unsuccessful, not because of the wickedness of the Government's friends in City dealing rooms but, quite simply, because no one

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believed that the British economy was basically a strong one. The green shoots of recovery have not exactly sprouted as we were led to believe they would do. They certainly have not sprouted following Mr. Major's return to power. The light at the end of the tunnel has flickered and been extinguished. The Government's commitment to low inflation has been achieved at the price of a weakened economy.
It is wholly misplaced for the Government now to rejoice at the recent inflation figures, given that there must be few people left to agree with the Chancellor. It is worth remembering his remark that 3 million unemployed is a price worth paying for low inflation. That has been achieved at appalling personal cost to those out of work. It is not difficult to achieve low inflation by running a country's economy into the ground; it is not too hard to get low interest rates at the price of a headlong devaluation of sterling. When he was Chancellor, Mr. Major said: If it is not hurting, it is not working. It is hurting deeply but it does not seem to be working at all. We have the hurt without the work.
Unemployment will cost the Exchequer no less than £27 billion every year so long as it remains at present levels. The Government's forecast for next year's public sector borrowing requirement is £47 billion. A major additional review of public spending is under way. Departments are being asked to cut expenditure by 5 per cent. We are told that the Chancellor may be looking at tax increases in one or both of this year's budgets to finance the government deficit.
The Conservative Government are finally being forced into the open as the party of higher taxation. Conservative governments have pushed up the tax burden, increased national insurance rates and more than doubled VAT. Why will the Chancellor probably have to raise taxes in the Budget? To bail out a failed government which spend so much and do so little that they are of very little real use to those who are worst affected. There may be further increases in VAT, and rumours that it may be put even on the price of food, fuel and other items.
The devaluation of sterling that has already taken place is expected to increase food prices and factory gate prices by significant amounts. Inflation is likely to rise as a direct consequence of the Government's failure to establish a sound economic base.
As Chancellor of the Exchequer and as Prime Minister Mr. Major had a choice. We could have entered the exchange rate mechanism at a level which the pound could have sustained and not one which it struggled for and failed to achieve. He could have increased income tax. He could have placed regulatory restraints on mortgage lending. He could have abolished the poll tax. He did none of those things. Instead he wielded the single sledgehammer—it was a sledgehammer—of high interest rates and an unsustainably high exchange rate. As The Times noted on Monday:
"The resulting four years of Majorism has crushed all of the jobs, many of the small businesses and most of the spirit of enterprise created during the Thatcher era".
That is a fair old assumption, if one believes that such a situation was created during the Thatcher era. If it
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is believed, there is not much joy in viewing what the Government have done since they took over from that lady.
When their policies failed last autumn, what was used to try to fill the vacuum at the heart of government policy? It was a so-called strategy for growth which simply produced more of the same failure. It has not halted the rise of unemployment or prevented record business failures. Around 1,200 small businesses now fail each week. It has not reduced the massive trade deficit. There has been no real public investment and no attempt to seize the opportunity to make substantial changes to policy, to admit past mistakes and perhaps even try to make amends. Even in the depths of recession when consumer spending is at its lowest, Britain still imports more than it exports. The Government keep telling us that the benefits of sterling devaluation have not yet worked their way through into the figures. How long shall we have to wait? Is not the truth that after 14 years of this Government's mismanagement of the economy, British goods are simply not there to be bought because of the Government's neglect of this country's industrial base?
The problem will persist, and even worsen if there is a recovery and people are prepared to spend again, because so many British manufacturing companies have gone to the wall or drastically reduced their output. The fundamental weakness still remains. Consumer spending is much more likely to be on foreign goods and, as a result, imports will rise again.
Unemployment—the Government's figure is 3 million, but in reality it is 4 million to 4.5 million—is the biggest disaster that the country has to face. The Government managed the economy in order to produce that disaster. It did not happen as a result of some miraculous event which was totally beyond the Government's control. It happened because of the way in which the Government chose to manage the economy over a period of some 14 years. It is an economic disaster, let alone a personal one. Britain cannot afford such levels of unemployment. The Treasury cannot afford it.
Now the Financial Secretary to the Treasury has made a statement about a public spending review. British industry and commerce cannot succeed without confident consumers who will spend their money on British goods. Those who were tempted into the property market cannot now get out of it, cannot afford unemployment and are trapped in increasing debt or have their homes repossessed. Most of all, however, if it is an economic disaster for the Treasury, it is a personal disaster for 3 million or 4 million people and their families.
I despair of the Government when it comes to unemployment, not only because of their lack of any policies to deal with it but because of their lack of a basic appreciation of its effect on ordinary people. I live in the London Borough of Lambeth. It is impossible to live there and not be conscious of the deep personal effect that unemployment has upon people. The Government do not seem able to imagine what it means to exist at benefit levels. Time and again

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they defend those levels. This afternoon the noble Earl even gloried in them. Perhaps he can envisage cuts or other inroads into them.
A few days ago I saw what I never dreamt of seeing again in my lifetime. I saw a document issued by the Ministry of Agriculture which suggested a sensible eating plan affordable by those on benefit. It suggested that people on benefit could among other things eat five slices of dry bread a day, half a fish finger, one slice of processed cheese every four days and one egg a week. This afternoon I am half tempted to emulate Ernie Bevin's performance before the famous inquiry in the early 1920s, when he produced on a plate what eminent economists had said a docker could subsist on at the wage that he was then being paid. It is shameful. It is absolutely shameful that in this day and age we should be faced with that sort of advice being given to our people in this country, which is a rich country and not a third world country. As I say, I almost despair of the way the Government take no account of this.
Many people on benefit, as is widely agreed, are also in debt—not in debt for luxuries through fecklessness, although I am bound to say that I detect on occasions the old Conservative concept of the "undeserving poor" creeping in in some of the speeches that we listen to—but in debt for necessities: for food, clothing and heating. And still the Government make it harder for people to get back into work, and they refuse to finance debt counselling; they allow the privatised utilities to charge higher levels to poorer customers by metering. How then do this Government —I quote again—
"look after those who cannot look after themselves"?
This terrible financial pressure on families in turn increases family breakdown and inevitably contributes to rising crime and to ill health, creating in turn greater demands on the National Health Service and on the Treasury. The huge costs to the Treasury of high unemployment prevent public spending in other areas and so local authorities have to cut social services and education budgets. Also the Lord Chancellor reduces eligibility for legal aid, and no department is safe from being asked to cut expenditure: at the moment it is all "up for grabs".
I believe deeply that so many of the social ills this country faces can be attributed to the record levels of unemployment, and I believe also that unemployment can itself be attributed to this Government's economic policies. Of course things are not as simple as that, but in essence that is the burden of the attack that we make upon this Government's stewardship of our nation's affairs over the last 14 years. Unemployment, the budget deficit and the trade deficit are the direct and inevitable consequences of the Conservative long-term failure to invest and now this Government seem to be devoid of ideas: certainly they appear not to have any idea about taking action to put people back to work. After 14 years of Conservative Government, Britain's economic problems are so deep seated that they are no longer susceptible to any quick solution.
If we are going to do anything about this matter, the country really must abandon the failed economic policies of the 1980s and the belief that the best
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government is that which does least, together with the misplaced trust in the market: competition without regulation or indeed the enforcement of standards. The Conservatives mistakenly believed—perhaps they still do, because it is a little unclear at the moment —that all that is necessary for the presence of individual opportunity is the absence of government. If you remove government from the market, inevitably as a result of the innate entrepreneurialism of the great British people and our manufacturing industry, we will get growth. But that did not happen. There were promises that the 1980s free market economics and monetarism would deliver zero inflation and the budget would balance. Your Lordships will no doubt remember the belief that the pound would replace the deutschmark and there would be a British economic miracle: all those objectives have failed.
Over the last 14 years industrial growth here has been slower than in most other industrialised countries. Manufacturing investment has seen little expansion and Britain's trade deficit has worsened more rapidly than that of any other European country. I know that the mess this country is now in is not going to be solved in five minutes. It needs long-term planning and investment and a long-term approach, but the first thing that it needs is a commitment from the Government to develop the full potential of everyone who wants to work. I believe that is the key to future long-term economic success. We should not be competing with the third world on wages; we should be competing with our industrial competitors on quality.
By combining skills training and employment, we could again become one of the skills capitals of the world instead of, as now, having skills 40 per cent. lower than the world's best, according to the CBI. Also we come 21st out of 22 countries in the OECD skills league, with only Greece below us. In tertiary education in Britain, a lower percentage of 16 to 21 year-olds is in college and university than in South Korea, and now even in Taiwan. Investment for each industrial worker in Britain is at half the level of the world's best. The key objective of economic policy must therefore be economic opportunity for all. Investment in the economy and the regeneration of Britain's debilitated industrial base are the essentials.
May I say this about the philosophy with which to approach this question? I think it is now time to reshape the whole terms of the argument as to what type of economy this country needs and what type of economy is right for Britain: whether it should be state led or market led. At best that is a somewhat sterile argument and at worst I think it is damaging. There clearly has to be partnership now between the public and the private sectors—not Conservative dogma of "public bad, private good"—with each sector recognising the strengths of the other and eliminating its weaknesses. Only by such a partnership will we achieve the best and not just basic public services, to transform our social economic fabric.
A strong economy needs a strong society, investment in industry and in the infrastructure, in science and technology, in the social fabric and in skills and, most of all, in individual potential. In my

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view, it is a government's fundamental duty to ensure that markets work in and not against the public interest. In so doing, they could break this vicious circle of unemployment, waste and decline in which the Government seem to be irretrievably enmeshed. As regards the other duties, as set out in the Conservative manifesto, to look after those who cannot look after themselves, to protect us all against crime and the consequences of poverty and to provide a sound economic base for long-term growth, I think they then will follow.
4.37 p.m.
Baroness O'Cathain: My Lords, the Motion we are debating is concerned with the economic and social consequences of the policies of Her Majesty's Government. I listened very carefully to the noble Lord, Lord Jenkins of Hillhead, whose Motion it is, but could not really ascertain what he felt the economic and social consequences of Government policies were—or is it that everything that occurs which goes wrong in this country is a result of Government policy? I am sure he does not really believe that.
Because very often things change imperceptibly it is very difficult to see consequences within a short time-frame and within the short term. Some of the economic and social deprivation that we witness now is undoubtedly the result of previous Government policies; some are undoubtedly the result of world-wide developments even going back as far as the first oil crisis nearly 20 years ago; but some are the direct result of underlying shifts in the structure of the population, changes in lifestyle, changes in technology and changes in values that are certainly not the result of Government policies, of whichever political complexion such Governments might be.
Today we are all deeply concerned about two very distressing situations: unemployment, which has already been dealt with very briefly, and the apparent breakdown of law and order. Nobody can hide their heads in the sands on these two issues, and I trust nobody would want to. Unemployment is a savage blow to one's self worth: an unemployed person is a person and not a statistic—a person who feels despair, shame and hopelessness. I know: I was once unemployed—and I pray that I never will be again.
But all unemployment is not the direct result of Government policies. Look at what has happened with the banks at the moment. There are serious job losses occurring and they are likely to continue to occur in the whole banking sector. That is certainly not the result of Government policies but is directly related to new technologies and to customer demands for a convenient service. Not everyone can get to a bank to cash a cheque during normal banking hours and so we have ATMs, holes in the wall, where we can get out our cash at any hour of the day or night. That is just one example. Still on the subject of banks, telephone banking has been introduced into this country and all one's financial transactions can be undertaken at any time. It is a 24-hour service and all one needs is a telephone.
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Both these developments have led either directly or indirectly to job losses, but both are the inexorable result of the onward march of technology—not government policies. Similarly, the peace dividend has led to job losses. Maybe this is more closely linked to government policy than the banking examples, but do any of us want a return to the dangers and uncertainties of the Cold War?
A final area where job losses have been serious and concerning is British Telecom. Here again, the new technologies have resulted in greater efficiencies of processes and job losses. We should all realise that if British Telecom had not espoused the new technologies our telephone system would probably now be in the hands of overseas companies or indeed languishing from the effects of under-investment and out-of-date equipment.
The noble Lord, Lord Richard, said that one of the reasons for high unemployment is the lack of investment. All the examples I have given of unemployment have been due to investment—investment in new technology. This just underlines the ghastly difficult nature of formulating policies in this somewhat chaotic world.
I have spent a little time talking about unemployment because it is top of mind, but I hope I have made the point that the ghastly unemployment figures are certainly not necessarily all due to government policies. The formulation of policies has got to take into account many given facts that are beyond the control of government; for example, the structure of the population. We have an ageing population. Just 40 years ago some 10.9 per cent. of the population was 65 or over; the figure is now 15.7 per cent., an increase of 44 per cent. in the numbers of elderly people who need above average expenditure in terms of national resources. People are living longer but are also being given that extra lifespan by medical and social policies—the cost of which was almost certainly never anticipated when the welfare state concept was introduced.
Another example is household size. For all sorts of different reasons, among them the relative instability of marriage and the absence of social stigma towards unmarried mothers, there are more and more people either living alone or else in two-person households. Some 60 per cent. of households fall into those categories now compared with 38 per cent. 40 years ago and 46 per cent. just 20 years ago. Neither a these developments is the result of government policies but both have a very big impact on the structure of our society for which government have to formulate policies.
I make these two points in an attempt to reduce the emphasis from destructive criticism and in an attempt to put forward the suggestion that as things have changed so utterly, for whatever reason, the best brains and the most concentration should be directed towards trying to ameliorate a situation which is causing concern to so many people in this country today.
To anticipate the fundamental changes in the structure of the population and the complete reversal of what was generally accepted as the "norm" in

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household size—just to mention these two areas—would never have been within the competence of any government. But the consequences of such changes have to be provided for by policies by government within limited resources of capital. And, in addition, such policies have to be acceptable to an electorate which demands greater say over the way taxes are spent while at the same time demands that it pays fewer taxes. This conundrum is paralleled in the United States today. It is no easy task. In fact I would go further than that and say that it must be the most difficult task in the country to get it right.
I am aware that there will be a litany of disaster chanted in this Chamber this evening. Let me try and put forward a few good things that have occurred, and of which I have first-hand experience, along with many of your Lordships, having worked in the "real world" rather than being in the rarified atmosphere of politics, the public service or the professions. The noble Earl, Lord Caithness, has already mentioned the motor industry. All he said was so right. I was employed by British Leyland for four years some 20 years ago. The British Leyland industrial relations department issued a daily list of where there were industrial relations disputes; that is, strikes. To my certain knowledge there was only one occasion in that four-year period when the daily sheet had no location on it—that was a Christmas Eve. It was as heartbreaking a document as one could ever see in manufacturing industry, and on many occasions the list extended to two pages. Government policies have changed all that and the almost unbelievable has happened.
All those who foretold the total demise of motor manufacturing in this country have been proved wrong. Both management and unions have got their act together, allied, aided and supported by government policies. The sadness is that en route to the excellent situation we have today there were so many casualties in terms of jobs, shareholders' moneys, the component companies and our British pride. But now there is a thriving motor industry in this country and we should not ignore that fact.
My sources of information on social consequences of policies are two-fold. The first the factual—from the government publication Social Trends, which is a fascinating, utterly readable and jargon-free publication that I have no hesitation in recommending to anyone with even a passing interest in the subject. My second source of information is research conducted in the main in my areas of business interests plus anecdotal evidence which we all seem to gather by the wheelbarrow-load!
I am going to forgo the temptation to allow subjectivity to overwhelm my statements and concentrate on an analysis of the first-mentioned source; namely, Social Trends. Here are some facts that I feel ought to be recognised. Full-time students in higher education increased in the two years from 1988–89 by 16.4 per cent. to a figure of 645,400 and the increase in part-time student numbers has been just as significant. Life expectation is steadily increasing—interestingly enough, the increase is greater for males than for females. I do not know what that tells us!
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A steady increase in the sales of unleaded petrol has had a dramatic effect on lead emissions—a reduction of three-quarters between 1975 and 1990. This is a direct result of government policy and has significant economic and social consequences. Increased expenditure on the arts has been little short of dramatic; an increase of some 53 per cent. between 1986–87 and 1991–92. The arts and their support are most important in both the economic and social life of this country.
Government policies concerning tax relief on charitable donations through Gift Aid and the scheme run by the Charities Aid Foundation have encouraged a large increase in our charitable giving. For example, covenants to charity increased from a figure of less than £200,000 in 1979 to nearly £900,000 in 1991. Socially, we seem to be a more caring society. I believe we are.
Sadly, in the section of Social Trends devoted to how people participate in society and the life of the community, Church membership is the most startling statistic—a decline of 16 per cent. in membership of Christian Churches in the five years to 1990. I cannot help but draw a conclusion from this point that if this decline had not happened there might be more people who, in the words of the prayer, might,
"honour one another and seek the common good".
Who knows what effect that might have had on the serious lawlessness that is evident today?
The single most important result of government policies has been the inexorable downward trend in inflation. The evils of high inflation have had to be experienced to be believed. Many of us here in your Lordships' House have little or no experience of the sheer misery of trying to live out one's retirement, constantly worrying about whether those savings and that contributory pension for which one had planned so carefully in years past are going to be adequate to provide the basic necessities of life. Those of us fortunate enough to be in full-time paid employment during the years of rampant inflation could mitigate the effects by tightening our belts a notch or two or, as so often was the case, negotiating for a compensating increase in wages or salary. There were millions not so lucky. The single greatest achievement of this government has been the reduction in inflation, and nobody should ever downgrade or underestimate that achievement.
There is an all-pervasive sense of gloom and despair pervading the media, the talk among the "chattering classes" and almost everywhere one turns just now. I have lost count of the number of people who have quoted the Daily Telegraph poll published on Monday, where the startling conclusion reached was that 49 per cent. of the population wished to emigrate. The noble Lord, Lord Jenkins, mentioned it again today. Let us please not get things totally out of context. The poll was of just over 1,000 people; those people were probably feeling demoralised by the apparently never-ending doom and gloom featured in the newspapers, on TV and on the radio. It also depends upon how the questions were put.
Understandable doom and gloom about unemployment, the breakdown in moral standards and

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uncertainty about the political stability of erstwhile stable regions are not the sole prerogative of the inhabitants of the United Kingdom. There are very many people like me who have made a conscious choice to live and work in this country; who have had many opportunities to live and work elsewhere but who took the decision that this country is the best in the world. If I had to make that choice all over again the answer would be just the same.
Please let us try to get the nature of our undoubted difficulties into an international perspective and then into national perspective. Let us work to solve the underlying problems, as we in this House can do. The economic and social policies of the Government have had major successes. We must not forget them in this debate.
4.50 p.m.
Lord Grimond: My Lords, I share the previous speaker's doubts about some of the findings of polls. They may indeed be exaggerated. When looking around Britain and remembering that it is one of the richest countries in the world and has suffered or enjoyed the enormous boom in oil, it is difficult to find why we should greatly rejoice in our performance. I find that difficult to understand. I have some sympathy with the findings of the Daily Telegraph poll.
A good government should, in the first place, be a competent government. It should also promote loyalty to the common good, particularly to the poorer people in the country, and be guided by some values. Our Government fail on all those tests. Anyone who looks at events—even of the past few weeks, let alone going back to the poll tax and the proposed closing of the mines—and who considers the handling of Maastricht or the pound must see that it is a highly incompetent Government.
I agree that the incompetence is not confined to the Government. Under the prevailing fashions, for which the Government must take some credit or debit for leading, we have become an incompetent country. The statistics as regards our performance of the past 20 years show that all too clearly. We can, of course, take particular moments and say that output has increased, but most of the moments taken are at rock bottom. The increases in output and so forth are not very large when measured against world standards.
Our pound has fallen in purchasing power over the past 20 years or so by 50 per cent. Our current deficit, expressed as a percentage of our GDP per capita, is the largest in the world of any major nation. Since 1979—that is, during the period of Conservative rule —our manufacturing output has risen by 6 per cent. compared with an average of 34 per cent. in the other OECD countries. What is particularly significant is the output of electricity, which has risen by 32 per cent. against 107 per cent. in Germany and 223 per cent. in France. Our workers have roughly half the power at their elbows which the American workers enjoy and only about three-quarters of that enjoyed by the Germans.
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As I said, that wretched performance has been achieved when we had the enormous bonus of North Sea oil. I am sure that future generations will look back in astonishment at the way in which we handle our currency and credit in this age. Today, when unemployment is over 3 million, one bank has declared record profits at a time when we are told that there are very heavy bad debts. How are those profits achieved and what benefit are they to the workers in the economy?
The German representative of the Commerzbank in London said that the commercial culture of the British is antipathetic to industry. I fear that in some ways he may be right, partly as a result of that concentration on quick profits which the banks like. In 1991 British firms spent the smallest amount on research in Europe and the largest amount in distributing dividends. It cannot be right to attach so much importance to short-term success on the Stock Exchange.
The first essential is to admit that our record is poor and that the fault lies with the people who run the country. We constantly hark back to 1978–79. We are told how much better things are, how the unions have been bashed and that one more economy has been set free. But according to all the major statistics, the country has not advanced since 1979. Therefore, it is no good saying that a miracle has taken place. The miracle is a myth, but the people at the top refuse to admit it. They either turn a blind eye to what has been happening or say that it is someone else's fault. However, more frequently than ever it is the same people with the same policies—or lack of them—who say that they will suddenly perform miracles and do what they have totally failed to do although they have been in office for 14 years.
After admitting our failure, the next step is to give up the illusion that we can succeed by public relations. That seems to be the growing tendency of government —to pretend that they are misunderstood and that if only their public relations officers did a better job they would be bound for popularity.
It is essential that the top people are held accountable or that they at least share the troubles which they have brought on the nation as a whole; that is, if they cannot be replaced, which might be better still. Yet the rewards of those people who run the nation have increased. The rich are getting richer and the poor are getting poorer. While we have 3 million unemployed, those who run our affairs are doing quite nicely. The salaries, pensions, allowances and perks of the top people go up. Furthermore, many of them have improved their situations with inflation.
It is time that we gave up indexation of the perks and allowances for top people. The Government are nowhere near abolishing inflation. I would have far more faith in the Government's promises to abolish it —not just to reduce it, as the last speaker said they had done—if they actually suffered from it to a greater extent. I believe that stopping indexation at the top of the scale for allowances and so forth might be a step in that direction.
I said that the Government should also encourage loyalty to the common good. But how can they

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promote it when those who run the country contract out of the consequences of their mismanagement? Inflation does not affect them; unemployment does not touch them personally. As regards our values, apparently a Treasury official has agreed to advance the Chancellor of the Exchequer about £4,000 to get rid of a tenant whom he, on his own initiative, took into his private house. I cannot imagine what Mr. Attlee would have said about that. I do not believe that the Chancellor of the Exchequer would have lasted very long under Mr. Attlee.
Civil servants used to be brought up to believe in safeguarding public funds and in the principle that under British law those in power are not specially privileged. All that appears to have gone by the board. From where we are standing this state of affairs must lead straight to the situation of 18th century France or one of the least successful South American republics.
If one wants to see how this country is being administered one might consider the almost laboratory case of Orkney, the part of the world where I live. The Orkney local council has spent over £20 million on what is called a short-sea crossing. So far there is no crossing. There is nothing at all as yet; it has all gone down to the bottom of the sea. Then there was the unhappy and disastrous mishandling of the children's case. I do not think that those events were unique. I suspect that they were more obvious because they happened in a small community. However, the point that I wish to make is that no official has resigned, been penalised or even apologised. One could say that it is a matter for the democratically elected councillors, but they cannot help either. They give the answer, "It is a matter for the officials", but the officials give the answer, "We only act according to what we are told and according to custom". The result is that no one has been held responsible for those unfortunate events.
I agree that the poll in the Daily Telegraph last Monday should not be exaggerated, but I hope that the Government have taken some notice of it. It is alarming that there is such a disastrous slump in respect for nearly all our institutions except, as my noble friend said, for the trades unions. However, that is not to be wondered at when one looks at the behaviour of so many of those institutions which appear to put their own interests first and to stand for their own interests rather than for the common good.
The main legacy of the past 12 years or so has been a great growth in bureaucracy and in bureaucratic attitudes. We are always hearing from the Government Benches the wonderful story about freedom being spread throughout the land. That is nonsense. On the contrary, there has been a growth in hypocrisy and bureaucracy unrivalled in our history at all levels and in all sorts of different ways. The niggling nanny state takes it upon itself to lay down regulation upon regulation. Statutes pour out while the main troubles of the country are neglected. I take as an example the Bill that we discussed yesterday. It was very thick, but did it relate to unemployment, the troubles in Eastern Europe or any world matter? Not at all, it dealt with leasehold reform in the West End of London. London Underground is hardly capable of
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running its own system yet it takes it upon itself, through its public relations officers, to plaster its stations with all sorts of injunctions about how we are to behave—about not eating in trains and not making too much noise. The nanny state literally behaves like a nanny—and not a very competent nanny at that.
I agree that there must be a partnership between the state, the individual and enterprise. But the duty of the state is not to run about the place like a scalded hen, attempting to do everything, but to deal with the major issues and to set the scene within which the individual can make his best efforts. Let the Government stop this flow of orders and get down to running the country better, to showing an example of competence, to clearing out the enormous top-hamper at the top of the country, and to giving more help to the people who are actually doing the job.
It is a scandal that we have invested so little when we face unemployment not only this year but for years to come. Once the Government show that they have some values in mind and some real policy which will last for more than a fortnight, and that that policy is aimed at the public at large, we may indeed pull out of our present rather sad condition and return to being a sane, united, and value-driven country—not a country that is simply at the mercy of whatever winds blow upon it from day to day.
5.4 p.m.
Lord Gilmour of Craigmillar: My Lords, as the noble Lord, Lord Jenkins of Hillhead, said earlier, this Motion is not one that readily lends itself to a totally uncontroversial speech, but I hope that by avoiding attacks upon opposition parties and by abstaining from extravagant praise of the Government I may be able to preserve some reasonable impartiality and keep my remarks within the traditions of your Lordships' House. After all, to shower the Government with acclaim when there are 3 million people unemployed and at a time of widespread poverty would itself possibly be considered controversial, if not eccentric.
Not that I want to be too critical of the Government. Up to September, I was strongly opposed to the Government's policy because I thought that the high exchange rate and the high interest rates that were necessary to keep it in place were having strongly destructive effects. But to be fair, the Government were not alone in their error. Other parties shared it, including most of the press and conventional wisdom.
Things are rather different now. The Government's economic policy—in so far as one knows what it is —has greatly improved, but one's congratulations have to be somewhat subdued by the knowledge that that happy result was achieved largely by inadvertence last Autumn. Not that inadvertence is necessarily a bad thing—it is certainly much better to be dragged along by the tide of events than to be sunk by ideology. The disadvantage of inadvertence is not just that it does not provide a very reliable guide to future policy, but that an involuntary conversion to a sensible policy does not engender the same confidence

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that would be inspired if it was the result of a coherent strategy in which the Government were seen strongly to believe.
However, I am less worried at the moment by the Government's inadvertence than by the element of intention which seems to be creeping into their policy. This recession is different from all others. It is different from its predecessors not only because it is deeper and longer, but because of our massive balance of payments deficit. That makes conventional reflation out of the question. But the opposite danger is not out of the question, and I am concerned that the Government might take action in the Budget to reduce their huge financial deficit. Of course, at some time the undue relaxation of fiscal policy which took place in the late 1980s and exacerbated the credit boom will have to be rectified. But it must be wrong to raise taxes at the trough of the worst recession since the war. The biggest danger that we face in the short term is that the recession will degenerate into slump. The time to raise taxes will be when domestic demand is clearly excessive—and not until then.
Whatever may be needed to remedy the economic consequences of the Government's policies, the social consequences can be remedied only by conscious and active intention. As the noble Lord, Lord Grimond, said, a key feature of the 1980s was that the rich got richer and the poor got poorer—not just relatively poorer (although there was a vast increase in inequality) but absolutely poorer, as government figures revealed last year. There was a large redistribution of income from the poor to the rich.
Among the principal sufferers were the unemployed who were treated as a tool for bringing down inflation and for keeping it down. I hope that the Government no longer hold that view and that they will accept that reducing unemployment is every bit as important as reducing inflation. I hope also that the unemployed will be treated decently and very much better than they were in the 1980s.
We are promised a crusade against crime—and that is all to the good. But it will be another example of the Government's inadvertence if it is not accompanied by a crusade against the conditions which breed crime. To take just two examples: 25 per cent. of the country's children are being brought up in families living on income support. That is, of course, at any one time, so over a period it is a far higher percentage. Yet, for families with children, income support is not enough to live on. That is not a state of affairs likely to foster great respect for legality. Secondly, during the past decade, poverty among young people has multiplied because of unemployment, repeated cuts in their benefit, the break-up of families and for other reasons. Those who have borne most of the brunt of increased poverty are single people in their late teens and early twenties. Yet the late teens is also the peak age for committing crimes. The Government rightly emphasise that the individual should recognise and take responsibility for his own actions, but surely it follows also that the Government must recognise and take responsibility for their own actions.
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For the rest, our main objective must be to rejuvenate, rebuild and revitalise our manufacturing industries upon which the country's prosperity depends otherwise unemployment will remain astronomically high. That rebuilding, as experience in the 1980s showed, cannot be done by market forces alone. The Government have much more to do than just create frameworks and talk up confidence.
The Government's present economic stance seems pretty nearly right. But both the Government and the country are afflicted by a hangover from the excesses of the 1980s. Unfortunately the Government, like many other hangover sufferers, seek alleviation of distressing symptoms by resorting to the concoction that caused the original headache. That process will be known to some of your Lordships as the hair of the dog. Current hairs of the dog are rail privatisation, the abolition of wages councils and an increase in taxes during a recession, if that happens. That merely prolongs the present state—the affliction. It does not produce a cure. What is needed is a new start. I hope that the Government will soon provide one.
5.13 p.m.
Lord Callaghan of Cardiff: My Lords, it is with great pleasure that I say on behalf of all noble Lords how much we appreciated the maiden speech of the noble Lord, Lord Gilmour of Craigmillar. Most of us have heard him on many occasions. It is clear that his hand has not lost its cunning. It was a perfect maiden speech: it was short; it was concise; its sentiments were perfect. And he was able to make his meaning clear without laying it on with a trowel. We all appreciated how he did that. He is a most welcome and powerful reinforcement to the forming of opinion in the House, and we expect him to play his full part in the days that lie ahead.
I am grateful to the noble Lord, Lord Jenkins of Hillhead, for making the speech that he did. I found myself in agreement with a great deal of it. I was not surprised at that. I have followed his writings and his speeches for a long time, and I find myself able to agree with much that he says. He has an unfortunate tendency, presumably the result of his unregenerate past, of always attacking former comrades when he speaks in order to show his objectivity. We forgive him that!
I, too, well remember the circumstances in which he left the Government. I had some part in it. It arose out of a conversation that President Giscard d'Estaing had with me in which he told me of his high opinion of the noble Lord and his devotion to the European Community. He thought that the addition of the noble Lord as a Commissioner would undoubtedly strengthen the European Commission and might give it fresh impetus. He asked whether I would be prepared to nominate him. I talked to Chancellor Schmidt. All three of us agreed that it would be a very good thing. So, with very great regret and rather against my will, I nominated him. I did not wish to stand in the way of strengthening the Community or of the noble Lord putting his talents at its disposal. It

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was not until this afternoon that I realised that he did not leave us on that account but because we proposed to take the port of Felixstowe into public ownership.
I listened to the noble Baroness, Lady O'Cathain, with great care and interest. She made a much better defence of the Government than the official spokesman who reminded me of that hoary old chestnut of the man in the magistrate's court who was obviously clearly guilty. So the defence lawyers wrote on the brief, "No defence,' attack the prosecuting attorney". That seemed to be the whole essence of the Minister's speech: to go back to 1979 and say how much better things were now than they were then.
The noble Baroness made a number of serious points. They are well worth our attention. I have a high opinion of the noble Baroness. Everything that I have heard about her shows her high ability and the respect in which she is held by those who work with her. I am sure that she has a great deal to contribute. If I found anything missing in her speech, it was the contribution which was later made by the noble Lord, Lord Grimond. Where was there any sense of values in what the noble Baroness had to say? She explained all the difficulties extremely lucidly. She said something about which we should all reflect carefully. But it was the speech of one of these modern young people who believe that everything is to be measured in terms of efficiency and productivity. I did not hear that note from the noble Lord, Lord Grimond.
I should have liked to hear from the noble Baroness —she once had some indirect connection with the Ministry of Agriculture, Fisheries and Food, if I remember correctly—some comment on the absolutely shocking piece of information that my noble friend Lord Richard gave when he told us of the diet of five slices of dry bread—whatever the other things were —that was supposed to constitute a proper diet for someone living on unemployment benefit. I am sure she would never agree with such a thing. But why could she not say so and make that clear?
Baroness O'Cathain: My Lords, I thank the noble Lord for giving way. I too was amazed by the comment made by the noble Lord, Lord Richard, but I have made it a policy not to comment upon something that I have not read. I do not like taking things out of context. I am well aware, through my association with the Ministry of Agriculture, Fisheries and Food, of documents that contain phrases such as, "for example, if". It is sometimes highly dangerous for someone who is given such information, not knowing the source document and not having gone back to it, to comment upon it. I was as appalled as is the noble Lord, Lord Callaghan. I have already made a note to go back to that document.
Lord Callaghan of Cardiff: My Lords, I am grateful to the noble Baroness. She said all that I would have expected her to say, because I would expect her to have that point of view. I shall make a simple comment: I do not mind making a simple comment. If true, that information is shocking. It should never be permitted in this country in 1993. I hope that I carry the whole House with me, and I am glad that my noble friend Lord Richard brought the matter before us.
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If our national confidence has been sapped, and if, as I believe, we are draining the country's morale, there is one simple reason: 3 million people out of work and over 1 million out of work for more than 12 months. Remove that and we will restore a great deal of confidence in this country and restore morale.
As the noble Lord, Lord Gilmour, said, the problem is different and more serious than that of previous recessions. The current recession has lasted longer than any since the 1930s. It is deeper than any other and is outside the experience of people who are at work. There is no end in sight. One does not have to look far to see why there is a falling away of national morale. That is particularly so when one bears in mind forecasts that by the end of the century there may be between 2 million and 3 million people still out of work.
Another reason why the recession is having such a lowering impact on the national consciousness is that unlike others no one is exempt. I dare say that many of us have experience of the recession hitting our families or we know someone among our friends and others. In previous recessions particular areas of the country and single industries were hit. The current recession has heralded the onset of general unemployment. All regions, all industries, all ages and manual, clerical, administrative workers, the self-employed and wage earners have been affected. Indeed, the whole country is involved.
Like other noble Lords I remember the 1930s as a young man. I address my comments to younger noble Lords who will not have known that time. I have no doubt that the recession will leave as deep a scar on the national consciousness as was left by that of the 1930s. I can recall the serious impact of that recession and the rigidities which were built up in later years by the trade unions and other organisations. We have already reached the stage where we have created for our successors some difficult times ahead. So the Government must be warned. I do not believe that those who have little or no recollection of the 1930s realise the risks which the country is running or the long-term damage that is being caused to our collective psychology.
I hear Ministers repeat parrot-like phrases such as, "Industry is poised to take advantage of the coming recovery", or, as the noble Earl said today, "Essential elements of national recovery are now in place". At times I feel like spitting because we have heard those phrases so often and for so long that they mean so little. When they were first uttered some years ago I thought, "Yes, that is right. The Government have cleared away a lot of the undergrowth and perhaps we are now ready to take a step forward". But it has not happened and that is the Government's failure. I say to the noble Baroness, Lady O'Cathain, that the Government have a responsibility and they can do something. The noble Baroness must not excuse them for everything.
One part of the Government's strategy worked. They succeeded in closing down many out-of-date factories in which efficiency was lacking. They used a deflationary monetary policy in order to achieve that. That policy half worked but what did not work was

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their expectation that the market economy, which was the other half of the equation and which in some automatic fashion was supposed to fill the gap that had been created, would be established. It has not been established yet and we see no prospect of that, however poised we may be to take advantage. Even today our industrial base continues to shrivel.
That is why people can see for themselves that government policies do not work. That is why trust in the Government is now markedly low. I agree that it is not high among any of us but the lack of trust has infected other institutions. That is the danger to which the noble Lord, Lord Jenkins of Hillhead, referred. The Government are a bellwether in this area and I fear that the lack of trust in the Government and in their capacity will be hard to overcome.
We find therefore that our industrial base has shrivelled and that although there has been new investment in some areas it has by no means been sufficient to take up the slack that has been created. I echo the noble Lord, Lord Gilmour, in saying that a future large-scale recovery will reveal a huge hole in Britain's manufacturing productive capacity. There will be revealed a hole in our product range and in our ability to supply our domestic customers or our overseas customers. The noble Lord is right in saying that recovery will be followed by a disastrous effect on our balance of trade and balance of payments.
The Government have a cock-eyed view of economic policy. They have persistently and mistakenly believed and asserted that, provided they do their job in bringing down inflation and leave the market alone to pursue its own intelligent self-interest, as night follows day the economy will grow, the balance of trade with other countries will become favourable and new jobs in up-to-date industries will replace those that have been lost. Well, that has not happened. There have been 14 years during which that might have happened. Fourteen years is long enough for an experiment of that nature to be seen and to be carried through before it shows the expected results. We must give the Government credit for low inflation but the beneficial effects have not worked through in growth, re-investment and jobs. The conclusion, which was drawn by my noble friend Lord Richard and other noble Lords, is that the market economy, left to itself, is not enough and is not self regulating.
Perhaps the truth of that is now being realised by Ministers. I know that we are in advance of the Budget when perhaps there will be a revelation of great truth and new light but Ministers look as though they are sitting paralysed, able only to put forward new schemes of retraining. We all agree that that is important but young people will ask: what is the use of retraining when there is no job at the end? Such panaceas may help young people for a few months but I know from my own anecdotal experience that they have no lasting impact. The schemes are unable to end the waste of men and women. The situation is exactly like that of the 1930s with the same poverty of thinking about the way in which we should overcome it.
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It is clear what, if our finances were in order, should be done at a time like this. The Government should step into the breach. There are many unmet needs which require only financing and which would begin to increase production and to create jobs; for instance, the railways, transport and housing. They are well-known needs and I shall not detain your Lordships by listing them. If it were later thought necessary to stimulate consumption there are many ways in which that could be done; for instance, by reducing national insurance contributions, by spending on education, and so forth. One must balance one's budget over a period of years. That is the classic way and it is what we thought we were supposed to be doing.
But now the IMF is warning the Government that it should not increase government expenditure. It is said that such remedies are not open to the Government because their deficit is already too high. Revenue is too low—in other words, there is not sufficient production to produce the present revenue at the existing rates of taxation, or taxation rates are not high enough—and expenditure is too high. If the Chancellor were to listen to the IMF he would, in the coming Budget, increase income tax, or VAT, or both. Like other noble Lords who have spoken I trust that he will not do so. It cannot be right to follow such a course at this juncture. It would have the effect of lowering confidence even further and of reducing demand, which is already too low for our productive capacity. Perhaps unemployment would rise even higher than the levels which we know are due to hit us during the coming year.
Let us all face the fact that the Government are in a cul-de-sac. Even if there is a tiny increase in the growth rate in 1993, as I hope there will be, that will have little effect on reducing the army of unemployed. With those restrictions, some of which are of the Government's own making, what is to be done? I shall now utter a clichÉ but it is important: there must be a sense of leadership and the Government must assert some economic priorities which the country must then accept. That must not be limited to a simple continuous assertion that the Government's job is to keep inflation low and look how well they have done. That will not do in 1993. In my view they should state clearly —and it would be a simple act of leadership to state clearly—what is their objective.
In 1944 the Conservative Party of that day and the Labour Party then in government and the Liberal Party all joined in a common assertion written in May 1944 in Cmd Paper No. 6527. They stated their objective. It is time that the Government stated their objectives today. That paper stated:
"The Government accept as one of their primary aims and responsibilities the maintenance of a high and stable level of employment".
If the Government would once say that, at least we should know where we are and what the Government are trying to do. We could understand the difficulties which lie in their way. At least it would not just be the Government saying, "We have got inflation down to 1.7 per cent. Look how well we are doing. Now it is for industry to do the rest". The Government have their responsibilities to every citizen of this country.

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Paragraph 41 of the paper stated:
"The Government are prepared to accept in future the responsibility for taking action at the earliest possible stage to arrest a threatened slump".
This is not a recession now; it is a slump. Those of us who know recognise it as a slump. The paper went on:
"This involves a new approach and a new responsibility for the State".
I do not suppose that the noble Earl knows what a sense of thrill went through people in the armed forces when they heard that. Other noble Lords will remember also, as I do, that those people knew that they would not return to what happened after the First World War. That was the reason that the pledge was made; namely, because of the one legged soldiers parading their medals and their wounds on the streets of London and elsewhere. That is why that pledge was made.
At that time in 1944 the war against Germany seemed to be coming to an end but the armed forces were told that they had to go to Japan and the Pacific and that they had to root out the Japanese from every island. We were warned that they would fight in every island. Therefore, that pledge gave us hope for the future.
I remember going home to my people and saying, "Look, this is what the Government are going to do. This is it." It had remarkable reverberations because the Government were showing leadership. I must say to the noble Earl, and I hope that he will believe me, that that had a profound effect upon us. The Government were pledging that we should not return to what had happened in the past. The time has now come for this Government to renew that pledge and to accept their obligations. Their predecessors saw nothing wrong in doing that. That would give fresh hope and inspiration because the nation would know where the Government stand. I believe that it would then be more ready to follow their lead.
I apologise to your Lordships because I have spoken for 20 minutes. Therefore, I shall scrap the rest of my speech because it is obviously far too long. However, perhaps I may be allowed a few more moments.
First, I say to the Government that the German Government and industry have worked out a sensible basis for determining wages policy. Tripartite discussions are held which are extremely successful. I wish that the Government would stop pursuing the unions. The Bill which will be before this House shortly is miserable and pettifogging. It proposes to withdraw public funding of trade union ballots for strikes. What is the value of doing that? How ridiculous to introduce such a Bill. I can hardly conceive what lies behind the Government's thinking.
Finally, the social consequences go much wider than the United Kingdom. They affect the whole of Europe. I wish that I had time to develop that theme and to say what I think should be done on the European front. However, I conclude by pointing out the historical background to the rise of unemployment in the 1920s and 1930s and what happened in Germany as a result. In my view unemployment was the major issue which brought Hitler to power. We can see vestiges of that today. Extremism has reared
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its head again. The trek of refugees across Europe will cause major problems and damage to our society. International action is needed and I urge that upon the Government. I am sorry that I do not have time to explain what I think should be done. However, that does not relieve the Government of their own responsibility for devising their own measures.
5.36 p.m.
Lord Ezra: My Lords, I am pleased to follow the noble Lord, Lord Callaghan. I only regret that he felt that he could not complete his speech. I hope that on some other occasion he will give us that part of his speech which he did not deliver today. I am delighted also, as the rest of your Lordships will have been, to have had the opportunity of hearing the maiden speech of the noble Lord, Lord Gilmour, who was suitably congratulated by the noble Lord, Lord Callaghan. We all support that congratulation.
My noble friend Lord Jenkins has introduced an important subject at an extremely important time. He did so in a most impactive and wide ranging manner.
At this stage in our debate we are all clear about what are the basic problems that we face. The difficulty is how to solve those problems. The budget deficit has grown to totally unexpected and disturbing levels. It is worth reminding ourselves that at £37 billion it represents 6.25 per cent. of GDP. By comparison, the US budget deficit, about which so much has been written and said, runs at 5.5 per cent. of GDP. If our budget deficit rises to anything like £47 billion next year, that would be approximately 8 per cent. of GDP—a very dangerous level to be reached.
The balance of payments deficit has been referred to, as has the very sad and sobering thought that we ran up such a large deficit at a time of recession—£12 billion last year which is forecast to rise to at least £15 billion and perhaps £20 billion in the current year.
Unemployment is rising. We now have that horrific figure of 3 million. Associated with that, a point to which the noble Lord, Lord Richard, referred, is personal indebtedness. I have had something to do with that because I was concerned with a working party which looked at ways to increase counselling services. In the process, we examined many individual cases. It was disturbing to see the large number of cases of multiple indebtedness and the misery which that causes in households which have got into that situation, very often through no fault of their own. That is an accompaniment to the present economic situation in which we find ourselves.
As many noble Lords have said, those aspects, disturbing in themselves as they are, are a manifestation of a deeper problem. That deeper problem is the inadequacy of our industrial capacity including the physical infrastructure. The point is that that situation has tended to develop over many years but it has accelerated in recent times. During the period from 1979 to 1991 the level of consumption in this country rose by something like 40 per cent. but the level of manufacturing output rose by only 11 per cent. The difference was made up by imports, which

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doubled in that period. In those few statistics lies, in my opinion, the basic problem which we in Britain face today.
The risk is that if we emerge from the current recession through a renewal of consumer expenditure, we could find ourselves going through the same situation again. That is why I am very concerned that High Street spending seems to be regarded as the key to economic recovery. High Street spending which involves increased imports will certainly only be the key to a very transient recovery leading once again to the difficulties we have had in the past decade.
We must consider other ways of dealing with this matter. I hope that the green shoots will first appear in increased investment in a productive capacity. How can we bring that about? The private sector will not start to invest again unless it feels that the economy is recovering and therefore it is producing goods that people will wish to buy. That is the difficulty. However, there is one way round this. Here I wish to take up a point made by the noble Lord, Lord Callaghan. He referred to the physical infrastructure. He said we could spend a lot more money, very desirably, on our transport system and on houses and buildings. That could lead to recovery if we had the resources to spend on the physical infrastructure. I wish to take up a little of your Lordships' time to indicate some of the measures I believe we should now adopt. I shall discuss the resources later.
There is not the slightest doubt that all of us who use our railway system feel that a great deal could be done to improve it. I believe that the people who run the railways do their best in difficult circumstances. At the least we should have a major programme of track renovation. I heard recently that the railways are having to cut back on some of their proposals because of a lack of resources. We should be going ahead with the Heathrow to Paddington link and with the Halifax to Huddersfield line. We should be accelerating work in connection with the Channel Tunnel. We should be adding to our electrification system. All that is a vitally important part of the physical infrastructure of the country on which we can base recovery and without which we cannot rely on lasting recovery.
The London Underground is another case in point. I note that the noble Lord, Lord Jay, has tabled a Question to ask the Government whether they will consider restoring their previous level of investment. I believe that is essential. The Underground has not received sufficient investment to maintain current levels of service, let alone to replace old rolling stock and to modernise the track. We should also encourage light rail projects wherever they are desirable. We should go even further than the Government's recent proposals with regard to roads, particularly as regards roads that feed off main roads and which come under the remit of local authorities.
An enormous amount could be done in the area of housing. We on these Benches have for years talked about the desirability of an accelerated release of the funds which councils have accumulated through the sale of council houses. Housing associations should be given more resources. Much could be spent on the
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physical infrastructure of our educational institutions, on school repairs and renovation programmes. We could do much to accelerate schemes to increase energy efficiency to help the environment. We could insulate more homes, particularly those of people on low incomes. I would also include a measure to help the private sector. I believe that the uniform business rate which was introduced at a difficult time—the Government have frozen it for a time—should be reduced over a period of time.
I have worked out what all these desirable measures, which were referred to in broad terms by the noble Lord, Lord Callaghan, would cost. I take account of the fact that one cannot spend money at an excessive rate and that one is limited to having work carried out at the rate at which it can be mobilised. I have the costs worked out in greater detail than I have indicated to your Lordships. I have calculated that to implement the measures I have referred to over a two-year period would cost about £8 billion. Furthermore, I believe that if we did that, it would have a direct impact on employment. Something like 350,000 more jobs would be created as a direct result of the work undertaken. However, far more jobs would be created within the private sector.
How should we raise this £8 billion which in my opinion is the cost of adopting the right measures to set about creating green shoots? The measures I have mentioned constitute the right way to get the economy moving again and to reactivate the construction industry. That is the hardest hit of all our industries. If these measures were undertaken, industry would be reactivated and people would have more money in their pockets. If more people were employed and received wages and salaries, they would increase the Government's tax revenues. We obviously cannot add £8 billion to the PSBR. That is impossible. The only alternative is to add it to tax. Tax to many people constitutes a dirty word. Elections have been lost by the injudicious mention of the word "tax". Let us look at this matter another way. I now believe that if people knew what the extra tax revenues were to be used for, they would feel far happier about paying extra tax.
At the time of the last election the Liberal Democrats propounded the idea of an extra penny of tax to help education. Of all the measures we proposed we found that that measure seemed to attract a large amount of support because people felt education was an important part of their lives. They therefore felt it was right to contribute an extra penny of tax to help education.
When a company needs to find additional resources to carry out essential investment or development, it can do one of two things. It can either approach a bank and increase its indebtedness—many companies now would be loath to do that, and I am not suggesting that UK Limited should do that —or it approaches its shareholders and it makes a rights issue. A company asks its shareholders to contribute more shares so it can add to their wealth as owners of the company through the investment the company will make with the money. I should like to apply the same principle to the proposal of putting more resources into our essential physical infrastructure. I suggest

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that should be financed at the appropriate time—the next Budget may not be the appropriate time. Perhaps we should leave this measure until the autumn. I suggest that we should call it an investment levy. I propose that it should last for two years and that it should be specifically devoted to the measures I have mentioned. At the end of that period full account should be given to the nation of what had been done with the money.
If we needed to address the question again after that period, we could address it in the same way. However, I would hope that by then the investment levy would have stimulated the economy so that further rights issues of that kind would not be required. I make that suggestion because I have felt for a long time that many of us who believe things are wrong make general statements about how we think things should be put right. I thought that it might be timely to venture to make this proposal, working out the amounts involved, as to how the money should be spent and how it should be raised. I hope that the proposal will receive some consideration.
5.50 p.m.
Lord Skidelsky: My Lords, it is the duty of an Opposition, even in this House, to oppose the Government, and the speeches of the noble Lord, Lord Jenkins of Hillhead, and the noble Lord, Lord Richard, duly blamed the Government for most of our ills. The noble Lord, Lord Jenkins, illuminated our discussions with historical analogies which some felt were apt and others felt were less so. I should like to add one historical footnote. The last time an opinion poll showed so many people wanting to emigrate from Britain was in 1969, when the noble Lord, Lord Jenkins, was Chancellor of the Exchequer. I mention that fact only because I do not believe that one should take single polls too seriously since these things come and go.
The noble Lord, Lord Richard, argued that the Opposition cannot be held responsible for what has happened since 1979. That is partly true and it is a perfectly valid debating point. However, it is also partly wrong because the Government inherited an industrial system in decay, a desperate system of industrial relations and an inflation rate which was out of control. That was inherited from the previous government, who had been in power for the preceding six years. Therefore much of this Government's early period in office was spent trying to control that situation.
Even the noble Lord, Lord Jenkins, would not blame in present circumstances the 10.9 per cent. unemployment in France on the policies of the British Government, nor the fact that in Germany industrial production was down by 7.5 per cent. in the third quarter of 1992 and that in Japan production had fallen by 8.2 per cent. Not even incompetence on the scale attributed to the present Government could be the cause of such widespread malaise. The fact of the matter is that there is a world recession, with Western Europe on the edge of a depression—one from which we are likely to escape more quickly than others as a result of the policies adopted since last autumn.
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My noble friend Lord Caithness was not just making a debating point when he spoke of policies for recovery being in place. There was substantial productivity growth in manufacturing in the 1980s, amounting to 4.5 per cent. between 1980 and 1990. That productivity growth was much higher than in the 1970s.
I should like to make one comment in respect of the remarks of the noble Lord, Lord Callaghan, about the 1930s. Of course the 1930s were a ghastly period. There was a high level of unemployment, but something else was happening underneath to which the noble Lord did not refer, namely very high productivity growth. That occurred right through the 1930s and laid the basis for the successful British economic performance in the Second World War. Therefore, it is not just the level of unemployment at any moment in time which counts. It is what is going on in the economy and what improvements are being made to the manufacturing capacity of the economy. In that sense the 1930s were not altogether dissimilar from what was happening in the 1980s.
Unemployment is much too high. No one denies that. Yet again that is not quite what it seems. Many new jobs were created in the 1980s even while unemployment remained at a very high level. Over 2 million new jobs were created and the OECD said that the United Kingdom had by far the best job creation record among the larger EC economies. It sounds like a paradox for there to be many new jobs being created while there is a high level of unemployment as a result of some industries having shed jobs. A restructuring of the British economy was taking place. That restructuring left many casualties and much wreckage in its wake. It was a restructuring which should have occurred more slowly and should have started much earlier. It did not happen earlier because of the policy of subsidising decaying industries in the 1970s. Once that element was removed the whole horror of the industrial legacy of the 1970s was revealed. The result was that high level of unemployment, which took a long time to come down.
I do not deny for a moment that there are some features of our situation which are home grown and do not depend on what is happening in the rest of the world. However, the fact that they are home grown does not always mean that they were caused by the Government. I do not think that anyone would deny that monetary policy was mismanaged in the late 1980s. The depth of the present recession is due to the strength of the inflationary boom of the 1980s.
But were the Government entirely to blame for that? The banking system was far from blameless. I do not believe that many people anticipated what the effects of deregulation would be in the early 1980s. That interfered with all the control aggregates on which the Government relied.
Of course it is easy to be wise after the event, and something has to be done about that. The deregulation of the banking system introduced into our economy and into the world economy the old business and credit cycle generated in the private sector which had largely been absent in the 1950s and 1960s. In the 1970s when one talked of sources of

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instability those sources were attributed to the Government and to government finance. We now have the re-introduction of a major source of instability through the private sector. That problem has to be addressed.
On the other hand, I do not apply to governments standards of perfection in the conduct of economic policy, although that is very easy to do. The Government made mistakes. They were caught unawares, partly as a result of some of their own actions. However, even the noble Lord, Lord Jenkins, who is probably the one post-war Chancellor who left office with an enhanced reputation, might have found success elusive amid so many squabbling economists —or squabbling priests—and unreliable monetary aggregates as those with which my noble friends Lord Howe and Lord Lawson were faced in the 1980s.
The Government tend to be blamed for everything that goes wrong. Education and training are a very good example. Of course I am in favour of more education and training. The fact that Britain has been under-skilled relative to its competitors has been remarked upon for 100 years. It would have been very odd if the Government had been able to remedy in 10 years a problem which had existed for 100 years. However, training has become an all-encompassing remedy for all of society's insurmountable policy conundrums. Whenever we run out of other remedies we say that we should spend more money on training and education.
In fact, the Government are spending more money on training and retraining. Total annual spending on training and enterprise is about £2.7 billion a year, two-and-a-half times what it was in 1979. But the Government cannot do everything. If people do not want to be trained there is very little that one can do. A report issued only last week showed that there is a very high non-completion rate in training courses and in courses in further education. People do not persevere with them. It may be said that people would complete them if there were jobs at the end of the courses. One of the reasons why there are not jobs at the end of the courses is that people do not complete them. That is one of those vicious circles which is cultural. It is very hard to break and it will certainly not be broken merely by spending money.
A number of noble Lords have referred to macro-economic policy. There was general agreement that broad macro-economic policy is roughly right and is as Keynesian as it can prudently be at this moment. Since September sterling has been devalued by 25.6 per cent. against the yen, by 22.9 per cent. against the dollar and by 14.58 per cent. against the deutschmark. Interest rates have been halved from 12 per cent. to 6 per cent. And there has been a large boost to public investment, in particular in transport and social infrastructure. I do not believe that we can prudently do much more. We are no longer in a Keynesian world; I am disappointed that we are not.
We have to recognise that the Government do not have that definite leverage over output and employment which they had in the 1950s and 1960s. They had such leverage in the 1950s and 1960s because
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there was no inflation problem. As soon as one has a history of inflation and expectations of inflation, with no one knowing how fast or how far inflation will go, one can no longer forecast the effect on output and employment of additional expenditure, and how that will be divided between output and prices.
Fiscal policy has to be prudent. In 1976, the noble Lord, Lord Callaghan, recognised that when he said that one cannot spend one's way back to full employment and that that option was no longer available to us. He spoke against a background of high inflation for which he was not responsible. It was a factor in the background which affected the Government's calculations.
We have a large public sector deficit. It is estimated that it may grow to as much as 8 per cent. of GNP over the next two or three years, and that we cannot evolve much in the way of fiscal policy. I am disappointed about that; I should like to do so. I hate high levels of unemployment. However, one has to realise the limitation on government policy in the present circumstances. That is part of the legacy of the past 20 years.
In conclusion, I turn to what I believe that we can do in the medium term. Many of the structures which in the past have condemned Britain to high rates of inflation are still in place even though current rates of inflation are very low. Earnings continue to rise ahead of the cost of living. Average gross earnings grew by 4.6 per cent. in the year to 1993. That was higher than the underlying rate of inflation. Measures are now needed to assist the workings of the labour and capital markets—I refer to supply side measures—to reduce the rate of unemployment and to make finance more accessible to small firms.
Many noble Lords have alluded to the 1 million long-term unemployed. It is a tragedy. They are not effective competitors in the labour market and they therefore do not exercise a disinflationary effect on wages. Through a mixture of incentives, employers must be encouraged to take on the long-term unemployed. I refer to changes in national insurance contributions, training and perhaps some form of workfare. Such measures are what I call "ambulance work". There is scope for taking 500,000 people off the register of the long-term unemployed quickly. I earnestly commend the Government to consider such schemes. The real wastage of talent lies with the younger long-term unemployed—people who are out of work for a year with no hope of getting back into jobs. I feel deeply about them. Those are measures that I believe that we can consider.
I urge the Government to take some steps to improve the financial access for small firms to enable successful small firms to become successful medium-sized firms. Why not renew government commitment to the Unlisted Securities Market? That measure proved successful in assisting the business community in the mid-1980s.
We now have some of the conditions for a return to a stable system of exchange rates. If we really wish to use government policy to steady the real economy, we have to have in place a firm anti-inflationary discipline. That was one of the great strengths of the

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Bretton Woods system. Fiscal policy to steady the economy took place against a background of fixed exchange rates. Until the mid-1960s to late-1960s inflation was not an important factor in the management of our economic life. If we are ever to return to that position, we have to get back to a fixed exchange rate system. The sooner we do that, the better.
Some of the conditions are in place. We now have a low level of inflation. That is exactly the point at which to rejoin a fixed exchange rate system, not when one has a high level of inflation and wishes to use the exchange rate mechanism to bring inflation down. The time to join it is when one's monetary conditions are under control and one can attach oneself to the system as an anti-inflationary discipline. I hope that the Government will consider doing that as soon as possible.
6.6 p.m.
Lord Eatwell: My Lords, I wish to add my voice to the congratulations offered to the noble Lord, Lord Gilmour of Craigmillar for an excellent maiden speech. If his voice had been more often heard in Government over the past years perhaps we would not have needed the debate today; but we do because it is clear that the British economy is in a far weaker condition than at any time since the immediate aftermath of the Second World War. It is clear from the crucial figure which matters. The figure of 3 million unemployed is a measure of that weakness and as a wasted and wasting resource it contributes to that weakness.
I must take issue with the noble Baroness, Lady O'Cathain, who suggested that high levels of unemployment might be associated in some way with technological progress. Her analysis is simply the mirror image of the analysis of the Luddites. Like their analysis, it is also quite wrong. Those countries which enjoy the highest rates of technological progress today have the lowest levels of unemployment. Technological progress and unemployment are inversely related not positively related.
In the Autumn Statement, which the noble Earl, Lord Caithness, commended to the House, the Treasury admits that on its best assumption the level of unemployment in 1996 will be virtually the same as today. That admission makes a mockery of all the Government's protestations of concern about unemployment. It exposes as a cruel sham their pretence that they have anything other than sticking-plaster policies to combat unemployment or, as the noble Lord, Lord Skidelsky, called them, ambulance policies. In fact, the Government's policies are the prime cause of our difficulties today because they have created three great imbalances in our economy which first caused recession and now perpetuate it.
First, Government policy created a severe imbalance between the level of domestic demand and our ability to supply that demand competitively. That imbalance is revealed in the persistent tendency for imports to grow faster than exports, particularly in the case of manufacturers. Not only have the Government
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done nothing to reverse that trend of deterioration in the performance of our most important export sector, they have even argued that the decline did not matter.
When challenged on that decline, Ministers often point, as did the noble Earl, Lord Caithness, to the fact that over the past decade productivity growth in British manufacturing has been faster than productivity growth in the United States and Germany; and, indeed, faster than the EC average. The noble Lord, Lord Skidelsky, also referred to that point. The Government believed that that was a jolly good thing. What they fail to point out is that that productivity growth has coincided with no growth in output. Indeed, Britain has had a lower growth of manufactured output than the US, Germany or the EC average. The true measure of competitive success or failure is whether British industry has secured or lost markets at home and abroad. The answer is unequivocal: the loss of overseas market share and the enormous loss of market share at home is the precise measure of the total failure of the Government's non-policy for industry.
The second imbalance in the economy which the Government have created is the severe imbalance between consumption and investment, referred to by the noble Lord, Lord Ezra. For many years consumption expenditure in this country amounted to around 6 per cent. of gross domestic product—it was almost an historic constant. Indeed, over the period 1955 to 1979 there was a slight tendency for the share of private consumption in GDP to fall, making room for both higher public consumption and for a higher share of GDP devoted to industrial investment. But since 1979 the share of private consumption has rocketed from 59 per cent. of GDP to 66 per cent. of GDP today. That is a more than 10 per cent. increase in the share of private consumption in GDP—an all-time record.
The irresponsible monetary and fiscal policies of the past decade engulfed the economy in an unsustainable debt-driven consumption boom. The result of that for Britain's families is that they are now burdened by record levels of indebtedness. The result for the economy as a whole was that public and private investment were crowded out by the consumer boom.
The third major imbalance that the Government have inflicted on our economy—perhaps the most damaging imbalance of all —is the imbalance in the conduct of economic policy. The great folly of the past decade has been the abandonment of the use of fiscal policy as a tool of economic policy. The scale of public expenditure and taxation and the composition of expenditure and taxation are both powerful tools for the management of overall demand and for the maintenance of the balance of demand between consumption and investment. Yet the Government have declared that public expenditure was only there to be cut and income taxes could only go down. The economy was to be managed by a single instrument —short-term interest rates—and the rest, as they say, is history.
These, then, are the imbalances in our economy which must be overcome: a trade imbalance which is

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the product of government-induced industrial decline; a consumption-investment imbalance which is the product of government financial mismanagement; and an economic policy imbalance, which is the product quite simply of government economic incompetence. The only way to overcome the first two of those imbalances is if the recovery from the recession is investment-led. As the noble Lord, Lord Ezra, pointed out, any upturn in consumption would lead to a sharp increase in imports and in due course to a mixture of higher interest rates and higher inflation produced by a falling pound. If we had that consumption-led recovery the result would be that we would end up in a position not dissimilar to that we face today, only worse.
To ensure that the recovery is investment led we must overcome the third imbalance and restore fiscal policy to its rightful role in the policy mix. Interest rate policy will not, by itself, do the job. The fall in interest rates since September produced a 16 per cent. devaluation of the pound and improved the cash flow both of companies and of households which are carrying heavy debt burdens. All those effects are desirable. I am afraid that none, by itself, will be sufficient to secure a recovery.
Anyone who believes that devaluation is likely to produce the necessary turnaround in the long-term deterioration in our trading performance should take a look at the long-term trends of our exports and imports. It is difficult to detect the impact of exchange rate changes in those trends. That is not to say that exchange rates have no effect on trade; it is simply to say that the effects have been overwhelmed by the steady decline in other aspects of industrial competitiveness—quality, design, technical sophistication, labour force skills, and so forth—all of which have been undermined by the low level of investment in this country.
Nor is the fall in interest rates likely to do much for private industrial investment. Again, I agree with the noble Lord, Lord Ezra. When markets are depressed and the prospects of profits poor, even low interest rates will not greatly stimulate private investment. Again, all the historical evidence supports that conclusion. So while the present interest rate policy is not going to do any harm, neither is it going to do enough good. An active fiscal policy is needed too.
Of course, discussions of fiscal policy today—we have heard this in the debate this afternoon—are dominated by fear of a growing PSBR. That fear is entirely misplaced. The current fiscal deficit is not an economic problem; it is an economic necessity. Next year private sector net savings are likely to amount to well over 5 per cent. of GDP as the private sector repairs its balance sheets. If the Government are not running a deficit, if the Government are not absorbing those savings, then the economy will slide into a yet deeper recession, unemployment will rise even faster than it is at present and the savings would run to waste. It is important that we throw off the fallacy of the 1980s that fiscal policy is all about balancing the budget and remember that fiscal policy should be all about balancing the use of the nation's resources.
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To that end it is clear that in the current state of the British economy it would be the height of folly either to increase taxes or to cut public expenditure with a view simply to reducing the PSBR. Either step would stifle recovery. Britain desperately needs a high level of investment. In today's depressed markets private investment is unlikely to take the lead, so public investment must do the job. Higher public investment should be geared predominantly to reducing industrial costs and increasing the competitive potential of the tradables sector. That means increasing investment in infrastructure, in research and development and in education and training.
The economy today is so depressed that there is probably scope for increased public investment without any increase in taxation. But should the economy run into capacity constraints, or should there be a damaging surge in consumption, then there is a powerful case for increasing taxation on the highest income groups to fund higher public investment or, indeed, higher investment incentives for the private sector.
The case for increasing taxation on higher income groups does not derive from the fact that the better-off have enjoyed such substantial increases in real income in the 1980s, though that may be reason enough. The reason for targeting the better-off is technical, deriving from some path-breaking academic work done by my noble friend Lord Peston 30 years ago. He then pointed out that any increase in public investment funded by taxes on the better-off will in part reduce excess savings and so result in a net increase in overall demand, even though the expenditure apparently is balanced by tax receipts, and so will boost output in the economy as a whole. The same investment funded by a tax on the poor, who spend every penny they can get, would give no such net boost to the economy. Maintaining or even increasing the PSBR in the short run is the only way the deficit will be reduced in the medium term. That is the paradox we face at the moment. Only increased public investment now will lay the foundations for the sustainable and competitive recovery which will both improve the flow of tax revenues directly and lead to increased private sector spending as households improve their balance sheets.
The difficult task facing any government in the 1990s will be to correct the severe imbalances created in our economy by the Government in the 1980s. Changing the balance of government policy, restoring fiscal policy to its rightful place as a tool of medium-term economic management, is the first and vital step along the difficult path to economic recovery.
6.20 p.m.
Lord Palmer: My Lords, I too am grateful to the noble Lord, Lord Jenkins of Hillhead, for initiating this most timely debate. Today we have heard many fine speeches from all sides of the House, including the excellent maiden speech of the noble Lord, Lord Gilmour of Craigmillar, to whom I should like to offer my most sincere congratulations. I am thrilled that he has taken the name of Craigmillar in his title because

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I have a little farm which is literally a mile away from Craigmillar. I shall always think of his excellent maiden speech as I pass by.
I do not envy the noble Lord, Lord Henley, who has the task of replying to so many tirades of dissatisfaction with the policy and record of Her Majesty's Government over the past 14 years. But, first, I must apologise most sincerely to your Lordships. Owing to a long-standing family commitment I shall be unable to be present for the winding-up speeches tonight.
I am fortunate enough to live in the country and I intend to limit my comments to the catastrophic effects that the Government's policy (or rather lack of policy) has had on the rural scene.
I too am appalled at the statement made by the noble Lord, Lord Richard, about the directive from the Minister of Agriculture, Fisheries and Food. But scandalous though it is, it emphasises just how serious the situation has become. In the past 14 years, 84,000 jobs have been lost in the farming industry. In Scotland alone, 14,000 jobs have been lost over the past 10 years. Those involved in farming are 2.5 times more likely to commit suicide than the national average. Throughout the United Kingdom farming communities suffer three suicides every week.
Looking at those terrifying statistics, it is important to ask why that has occurred. I shall endeavour to explain. Fourteen years ago bread-making wheat was sold for £169 a tonne; today it is £151. Barley 14 years ago fetched £117; today it is £105. Fourteen years ago milk was 16p a litre and today it is 20p; sheep sold for the same price as today and the situation with cattle tells a similar tale. Today the price of wool is less than it was 40 years ago. Comparing the price of wheat with the price of a loaf of bread, we find something very far amiss. I find it difficult to understand how the price of wheat has gone down while the price of a loaf of bread has doubled.
On the other side of the equation, 14 years ago a 110 HP tractor retailed at £13,000. Today that same tractor would cost £35,000. In other words, for such a tractor 14 years ago a farmer needed to sell 111 tonnes of barley; today the amount required for that same tractor would be 333 tonnes. The cost of producing that tonnage has increased dramatically. Let me give two small examples. Over the past 14 years a general farm worker's wage has risen by a dramatic 177 per cent. The price of fuel has risen by 150 per cent.
By now I hope I have painted a sufficiently gloomy picture of the devastation of the rural economy. But perhaps the most terrifying statistic is that in 1979 the agricultural industry owed slightly less than £1 billion. Today that figure has risen to the horrific sum of £12 billion. Last year's interest payable on that debt amounted to £1 billion. That works out at £28 per annum on every single acre farmed in the United Kingdom. It is also vitally important to realise that against that gigantic debt the value of land has fallen almost exactly by 50 per cent. since the Government came to power.
At this point it is interesting to compare the situation in other countries to see how national aid over and above the CAP contribution varies
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dramatically. Government expenditure on food and agriculture as a percentage of total government expenditure in the United Kingdom is 0.4 per cent. In Germany and Holland it is 1 per cent. and in France it is 3 per cent. National government expenditure on agriculture as a percentage of agricultural output in the United Kingdom is just 6.8 per cent. In Germany it is nearly three times that figure and in France it is a staggering 29 per cent.
If we relate those figures to people and employment, a matter which has been mentioned so often this evening, the figures are even more shaming. National government expenditure on agriculture per person employed in France is 8,613 ecu; in the United Kingdom it is a pathetic 2,014 ecu. Converted into hectares, sadly the figures read no better. Holland spends 610 ecu, France spends 392 ecu, Germany spends 386 ecu and, needless to say, the United Kingdom bumbles along at the very bottom of the league, with just 83 ecu per hectare. I should like to stress that those figures represent the national aids over and above the CAP funding.
It does not take genius to work out how unfairly this Government treat UK farmers compared with the treatment of other governments within the European Community. I have a neighbour who also farms in France. As a well-disciplined UK farmer, he went along to the French equivalent of his local MAFF to obtain some guidelines on what he should do about set-aside on his French farm. He was met with a huge shrug of the shoulders and asked, "Qu' est-ce que c' est le set aside?"
Does the Minister agree that those figures make a complete mockery of the single market? The Minister in another place is often on record as saying that this Government and this Minister will not let British farming down. Surely it is high time that the Government acted on that promise.
6.27 p.m.
Lord Hooson: My Lords, I feel very tempted to emulate the noble Lord, Lord Palmer, in his discussion on agriculture, which I had certainly not intended to do. However, I entirely agree with his criticisms of the Government on their treatment of agriculture. One of the attractions of the EC when we entered was that it was a managed market. It was supposed to be managed for the whole Community and not, as it were, give opt-out clauses for our country. As I listened to the debate this afternoon and heard people reflect on the way we proceeded in the 1980s, I concluded that the one skill which certainly improved in the 1980s was the skill of public relations. It seems to me to have been used to create the illusion of success which was not there and to plaster over the creeping difficulties of the British economy.
The noble Baroness, Lady O'Cathain, and the noble Lord, Lord Skidelsky, in their defence of the Government, which was rather more effective than the defence made by the noble Earl, seemed to me to ignore the fact that Government has a very important input. Of course we live in a global economy and there is a global depression but it is nothing like the depth of depression that we have in this country. For

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example, the noble Baroness referred to the increasing number of people over 65 in the population in this country. That was foreseen and predicted over 25 years ago. That has happened also in Germany, Japan and the United States. The proportion of the increase is about the same in all the industrial countries. Therefore when she puts that forward as an excuse for what is happening in this country, I simply do not follow the logic.
Of course one of the worst things that has happened in our political life is that we are so used to the confrontational approach that one feels it necessary to attack the Government wholeheartedly and blame everything on them, or else defend them to the utmost, as the noble Baroness did. I am quite certain that our economy basically has been in decline for about 100 years.
We have always underestimated the great contributions to the capital formations of our country which came from the Empire. It may not be a happy episode for some of our former colonies to look back on, but they supplied in many ways much of the capital that went into the industrial development of this country. It is true that we persisted with old methods and old industries. We probably poured far too much money into them than was wise and we did not compensate on the other side and encourage new industries. Nevertheless, there is an important component which a government always put into the economy of this country, and that is why the Motion is critical of this Government.
It is my view that the Thatcher era in this country and the Reagan era in the United States made an important contribution towards the world depression. Reaganomics were fairly disastrous and in our own country what may be called "Thatcher economics" were equally so. They also left us a far more divided country. Selfishness in general, and individual selfishness, became elevated to the status of virtue and unfairness became the order of the day. I do not happen to agree that it is economists who decide or should determine the wise course for any country. In the end the decisions are political and it is the economic effects of political decisions that we have to bear in mind.
What did we lose during the Thatcher era? It seems to me that we lost heavily on investment in British industry. There was a decline in capacity, which has been referred to already, in our manufacturing industry. Last week the managing director of the private investment branch of one of the largest merchant banks in this country told me something I did not know: that over 30 per cent. of the dividends declared by public companies in this country are now earned from profits abroad. That is a very high proportion. It is not that the money has not been available for investment in this country: it is that our public companies have chosen to invest abroad. Only last week we learnt that RTZ and, I think, Hanson's were buying coal mines in the United States. Just compare that with the state of the coal industry over here.
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We must remember that what we suffered from in the 1980s, as we did earlier, was the lack of investment in British industry. Most of the money made during the boom period in the 1980s has not been invested in this country; it has been invested abroad. Why has that happened? That should be the question that we are asking. Is it a lack of confidence in the future of this country? Is it lack of direction? Should there have been greater control? These are all matters that a government should have been addressing.
Secondly, there has been the loss of traditional British skills. It was suggested in a leading article in a Sunday newspaper recently—I think it was the Independent on Sunday—that cheap unskilled labour is now our most significant national resource. Why has that come about? We are one of the oldest industrial countries in the world, with a great pool of skills. There has been great inconsistency in the Government's approach to the problems of support-ing skill in this country. In Wales in recent years the Government have been particularly proud of all the inward investment that we have been able to attract. Of course we are very glad of it. If it were not for the inward investment from the Japanese car companies, the German industrial companies and American companies, we should be in an even worse state now.
But how do we attract them? I have never seen figures of the amount of public subsidy that has been used to attract these companies to this country, but I know from examples in my own area that government agencies have been offering very large sums to induce companies to set up in this country, even companies with a poor financial record in their own country. Yet at the same time the Government have often refused to give help to native industries, and good reputable companies which were going through difficult times, when in fact the skills available to those companies represented a great national asset.
On the one hand, it seems that we are prepared to spend a lot of money attracting foreign capital to our country, and yet we have been unable to support some very good home-based companies at all. One example is the Leyland company at the present time. Is it wise for this country to let that company go to the wall, with the traditional skills that are found in that area? If we are able to put out millions to attract foreign firms to come here, as we have done, should we not be thinking in terms of providing money to preserve skills that are already here?
It seems to me that with old-established industries sometimes—of course one must take an independent judgment on each one separately—it is easier to maintain or develop its skills and modernise it than to introduce and support a new industry. New industries tend to be a bit footloose in my experience. They tend to come for a short time and take all the grants they can get. Then when they find greener pastures elsewhere, away they go. That does not happen with traditional industries.
I entirely agreed with the noble Lord, Lord Eatwell, when he referred to the debt-driven consumption boom. I am afraid that we could get into the same situation again. I also agreed entirely with the noble Lord, Lord Ezra, when he suggested a very practical

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means of increasing in a modest way, especially in the construction industry, opportunities in this country. I do not think we should leave it to the high street debt-led consumption boom again to try to lift us out of the depression. Of course this must be accompanied by international measures and common market measures to improve our economy because we cannot hope to do it as a single country.
However, it appears to me that we could do a great deal more ourselves than we have been doing. I should like to see much greater investment in industry, education and training for skills which would gradually enable us to get out of our present quagmire. We must get the economy going by means such as those that the noble Lord pointed out. I would go further. I think one of the greatest mistakes made in this country was made when the noble Lord, Lord Lawson, when Chancellor of the Exchequer cut taxes too much. I believe President Clinton is right in saying that it is impossible to tackle the American economy and its problems today without increasing taxation. I am speaking only for myself here, but I do not think that it is possible to improve our situation without increasing taxation—and I do not mean indirect taxation either but direct taxation on those who can afford to pay.
The truth is—I believe it was the noble Lord, Lord Grimond, who referred to this matter, although I am not using his exact words—that the chiefs in our country are very well paid in relation to the Indians. They have been all along—throughout the 1980s and the 1990s. That is true of the leading professions, and I include my own. I remember that when the top rate of tax was reduced at one fell swoop from 60 per cent. to 40 per cent., I did not meet anyone of any party in my profession who did not think that the tax cut had been too great. We would all have been grateful if it had been cut from 60 per cent to 50 per cent. It is now difficult to go back on that. But excessive tax cuts was one of the sources of our difficulties within the country.
If the green shoots that are talked about today as showing some signs of recovery do blossom, then in no time at all we will be in another fiscal crisis. The only way to deal with that is to have a modest increase in taxation early, particularly on those who pay in the higher bands. I would go along with the noble Lord, Lord Ezra, that if it is possible to earmark those increases in taxation specifically for investment it would be all for the good of the country.
6.40 p.m.
Lord Bruce of Donington: My Lords, I should like to add to the congratulations that have already been offered to the noble Lord, Lord Gilmour of Craigmillar. If this afternoon what we have had is a non-controversial speech within the conventions of the House, I am looking forward intensely to when he starts to become even moderately controversial. I hope that we hear from him many times again, and preferably soon.
I want to follow the line of argument that was just enunciated by the noble Lord, Lord Hooson. He pointed out the phenomenon of a very large overseas
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investment from this country, particularly, if I may add to what he said—no doubt he will agree—to the United States of America. Investment in manufactur-ing industry in this country has remained approximately constant ever since 1979 when it stood at slightly over £11 billion. Last year it stood at about £11 billion after a dip in 1980 to £7.5 billion.
There is general agreement that investment in British manufacturing industry has been far too low. In fact the capacity of manufacturing industry in this country since this Government have been in office has increased by 7 per cent. as against 32 per cent. in the United States and approximately 50 per cent. in Japan. So, on the assumption that was put forward by the noble Earl, Lord Caithness, that all government policy essentially consists of creating the climate within which the nation can become prosperous, on their own say-so the Government must have made an abysmal failure of the job. Quite clearly, they certainly have not encouraged any increased manufacturing investment in this country; rather they have encouraged it to go abroad. So they are indicted themselves.
We have been all through this before. I am slightly older than the noble Lord, Lord Callaghan. Perhaps I may put it more delicately by saying that the noble Lord, Lord Callaghan, is rather younger than I am. But I can still remember the days in the early 1930s when we suffered from what the late Ramsay MacDonald, supported by Mr. Baldwin, called the world depression. The fashionable term is now recession. The terms are said as though they are some external force or affliction—like a plague. There is no hint that the terms "recession" and "depression" essentially mean that the human organisations of society have failed to act in the proper way. It is corporate bodies, governments and private in-dividuals behaving in a certain way that gives rise, as day follows night, to a depression or recession. When there is a recession, as there is now, it is an indictment of those who participate actively in the affairs of a country.
It simply is not true, as the noble Lord, Lord Eatwell, was kind enough to point out, that a technological advance has been the prime cause of unemployment. That is complete rubbish. There was considerable technological advance between the end of the war and the early 1970s and yet unemployment remained at a very low level. We all know what happened and it is good to have the belated admission in rather less controversial terms this afternoon. A large part of the problem lay with the quadrupling of the price of oil in the early 1970s and the massive amounts of petrol money that flooded the world. That was one of the things that disturbed the comparatively smooth functioning of a mixed economy in the United Kingdom.
Those who were in receipt of these greatly increased incomes from the increased price of petrol—princip-ally but not exclusively in the Middle East—deposited them with British banks and with the world banking system. The function of banking is a comparatively simple one. It is to borrow money at one price and to lend it at another. Since that time, particularly over

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the past couple of years, there have been other additions to bank revenues which are possibly more controversial and subject to some criticism. But the basic function is to borrow money at one price and to lend it out at another. So, having accepted these vast deposits from the Middle East countries in particular, the banks of the Western world had to lend it out. They could not leave money there and pay interest on it without relending it.
There was enormous pressure from the banks of the world, including those of the United Kingdom, to get the developing countries or anyone who would borrow money to borrow it from them at very high rates of interest indeed. It went to South American countries and developing countries. It went all over the world. That very act in itself ultimately built up enormous economic problems for those countries— and since those countries were in trading relationships with ourselves and the rest of the world, troubles for ourselves too—to a point where, instead of participating in constructive trade with our own Commonwealth and other countries, most of the income generated in the countries was devoted to repaying interest and a part principal for sums advanced to them for comparatively useless purposes —mainly the purchase of arms. Where the bankers went offering to lend them money the arms manufacturers were close behind offering their goods in exchange for it. Those are the things that happened, and they injected an element of instability into the world system and indeed into the United Kingdom system which was very difficult indeed to deal with.
Essentially, we are talking about a philosophy, as before the war, of leaving everything to free enterprise. I remember very well in the early 1930s Montagu Norman and all the rest of them saying that free enterprise and market forces would solve all the problems, but they did not. What led to full employment was rearmament in the late 1930s and the fact that we had to control the economy very rigidly during the war itself. We were helped by forms of Lend Lease from the United States.
I very well remember that after the war if unemployment went above 2 per cent. it was reckoned to be extraordinary. I well remember the White Paper to which my noble friend Lord Callaghan referred. In that the Government themselves accepted responsibil-ity. Under the coalition terms at the time, which were supported by my own party as well, we accepted full employment as a principal objective. That has gone.
Where we made the mistake in the years following the early 1970s, particularly on the return of a Conservative Government, was that we thought that the same kinds of solution would apply again. We believed that all we had to do was to leave matters to market forces. Today we have the result. We have not 3 million unemployed, but on the old basis which applied in 1979 until the figures were doctored, we have nearer 4 million unemployed today. That has been the result of adopting purely market forces' policies with no controls and the abolition of exchange
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control leading in part to the liberty to invest on the lines put forward by the noble Lord, Lord Hooson. That has not worked.
That situation has been accompanied by another and even more important factor. It is a psychological factor in a sense. Concurrently with the readoption of policies which failed in the 1930s and through which I lived, there was a deliberate social policy of advocating that everybody should look after themselves first and that society did not exist. Society was a myth. That was the error.
I am not so pessimistic as the noble Lord, Lord Jenkins, evidently is at the publication in the Daily Telegraph of the disenchantment chart to which he has referred. I am far more cheerful than he is about that. I can remember in the past couple of months the announcement of the pit closures. That so stirred British society that I saw the most surprising kind of demonstration taking place, in Kensington of all places. People of all classes and types, carrying umbrellas, were marching in protest. That shows that there is still a collective conscience in the United Kingdom and unless the Government are very careful indeed, that conscience is going to be aroused again.
I do not want to be unjust to the noble Baroness, Lady O'Cathain, when I say that she seemed to be a little like an accountant. I am one myself, except that I have emancipated myself from that intellectual state to a point where I do not think that I am one of those who knows the cost of everything, but the value of nothing which is the normal attitude of an accountant. Today we are too prone to take that attitude. But we are improving.
Unfortunately, however, there are other trends at work. One cannot have been alive over these many years, particularly since 1979 and perhaps even before then, without believing that those who lead us and the economists who advise us, have become a little less buoyant and optimistic than perhaps their years and youthful vigour would justify. There was a mood in the late 1970s which I noted and regretted. It was that we had run out of solutions to the problems that we faced. That was pardonable of course because of the disturbance following the quadrupling of the price of oil to which I have referred, which put every Western economy into a very difficult position indeed.
I began to notice in the late 1970s in particular, a sense that governments, including the one which I supported, began to wonder where they were going to go next. In other words, they thought they had to go somewhere. That somewhere was of course Europe and the Common Market. It suddenly became fashionable to say that we have got to go somewhere else other than where we are; we have nowhere to go. I raised an eyebrow at that at the time because, personally speaking, I was brought up in the United Kingdom. It has always been slightly apart and divided from the Continent by the Channel. But I never thought that we should move it bodily to any other place. The United Kingdom has been quite all right for me.
There is the idea that somehow we have, physically and spiritually, to transfer ourselves away from our own country into somewhere where we can take

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shelter. I thought then and I think now that that is a lot of nonsense. We in this country are quite capable —having both the intellectual qualifications and the spiritual drive which exists behind all progress and all civilisation—of extricating ourselves from our own difficulties without seeking shelter in any other place.
Concurrently with that there has been another tendency to believe that since our old brains have obviously failed us in being able to solve the recession, then impersonal forces should be brought to bear on the problem and that we should have some discipline. So we had the exchange rate mechanism that was going to prevent the need for us to think any more. The matter would be settled. We could have fixed but flexible exchange rates. They tend to be more fixed than flexible. On that side of things we need not worry very much as long as the rate is stable, forgetting of course that all countries of the world are at different stages of development and have different social conditions. Therefore there are bound to be variations in the rate of exchange between one country and another. We supplemented that and we are seeking to do so again, by once again thinking that if we can eliminate something from our normal thinking and delegate it to an impersonal force, everything will solve itself.
I am sorry to have to return to the subject although many of your Lordships must have expected it; namely, Maastricht. Here we have the problem in classical terms. There are certain aspects which we find too difficult. So what do we do? We propose to set up a European monetary institute or a European central bank, which is going to determine the main economic parameters within which we operate. At the same time, we give extra powers to the Commission which is composed of no doubt learned—but not entirely learned—bureaucrats, who then proceed to lay down by regulation exactly what we shall do—and not always with the approval of the Council of Ministers. Three-quarters of the regulations that come to this country are sent through on the nod by the Council of Ministers which has not had the time to read them.
There is a sense that we are passing the responsibility outside our own country. How ridiculous that is. Looking at colleagues in your Lordships' House, I see the noble Lord, Lord Skidelsky, and a number of noble Lords on the Liberal Bench, the Cross-Benches and, indeed, on my own Bench. There are some formidable brains here. Have our bankers had such a good history—do they have such a good record—of the faultless administration of policy to be entrusted en masse with the determination of the parameters within which we can determine our own policy? I think that it is folly. In the same way, I think that it is folly that we should allow the Commission in Brussels to take powers which, apparently, we are afraid of exercising ourselves.
I have great faith in our country. There are sufficient ingenuities among the people of the United Kingdom—male and female—who by intelligence, application and, above all, by the transmission of compassion, can bring peace and serenity to our country.
7.1 p.m.
Lord Clark of Kempston: My Lords, I too add my congratulations to those that have been paid to my noble friend Lord Gilmour of Craigmillar on his maiden speech. When we were Members of another place he and I did not always see eye to eye, but I admired his ingenuity in keeping his maiden speech uncontroversial. Indeed, there was much in it with which I could agree.
I was delighted when I saw that we were to have a debate on the economy, but I was rather disappointed by the speech of the noble Lord, Lord Jenkins of Hillhead. He spent far too much time attacking personalities—both on this side, when he referred to my right honourable friends the Prime Minister and the Chancellor of the Exchequer, and when referring to his former colleagues. I thought that that was a shame. He spent some time talking about education, but did not mention that he was a member of a government who introduced comprehensive education into this country thus killing the grammar schools, the basis of our excellent education system.
Although the noble Lord castigated both the Government and the Opposition for their economic policies, and there was criticism of the Government also from the noble Lord, Lord Richard, neither mentioned that despite all the vicissitudes that the Government have experienced we have not had recourse to the International Monetary Fund, as they did: so I do not think that our economy can be as bad as they make out. One thing that worries me, however, is that when influential people run down this country's economy it only gives comfort to our competitors.
Much has been said about manufacturing industry. Everybody knew that in 1979 our manufacturing industry was overmanned and trades-union dominat-ed. I agreed with the noble Baroness, Lady O'Cathain, when she gave us her experience of the Leyland episode. Just think of the amount of taxpayers' money that went into the car industry which eventually collapsed.
Like every other country, the United Kingdom has suffered because of the world recession. The Budget is looming and the Government and the country face an overseas budget deficit. I am delighted that the Government have at last returned to differentiating between revenue expenditure and capital expenditure. Thirty billion pounds of our £37 billion deficit for this year comprises capital projects. That puts a different complexion on our overspending. I do not believe that the Chancellor will have much trouble funding his public sector borrowing requirement, but I should like him to look at capital gains tax. I have been convinced for some time that capital gains tax is a deterrent to the movement of capital. Capital is immobilised because people do not want to pay capital gains tax.
We should look at the background to any debate on the economy. My noble friend the Minister pointed out that the inflation rate, which was over 10 per cent., is now down to 1.7 per cent. That is the lowest in Europe and the lowest that this country has enjoyed since 1967.
Overseas assets have also been referred to. We should remember that some of our overseas assets

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have been forced upon industrialists. Let us take the United States as an example. It is extremely difficult to break into a market in the United States unless one has a subsidiary there. I know from personal experience that that applies particularly to the boot and shoe industry, where the situation is very difficult. Much of our overseas investment helps our exports because without it we would not be able to enter overseas markets. It shows the strength of the British economy that we have well over £100 billion-worth of assets abroad—not only in the United States, but throughout Europe also.
Inward investment is sometimes criticised. I should have thought that any inward investment in this country must mean that the foreigner who is investing has confidence in our economy. Thirty-three per cent. of all the inward investment in the European Community comes to this country. That is a telling point. Again, 41 per cent. of Japanese inward investment comes to this country. The Japanese are no fools and they would not invest in a country which was on the rocks. Some 36 per cent. of the United States' overseas investment comes to this country. One need only go to Tyne and Wear to see the Nissan factory there or to Derby to see the Toyota factory to realise that there is no question about the amount of inward investment. The projects in those areas are now coming on stream. Indeed, the trade deficit in cars which we have suffered for years since the collapse of Leyland and the rest will be remedied within two to two-and-a-half years by which time those factories will be giving us an export surplus in motors.
The noble Lord, Lord Jenkins, said that the Government view the 3 million unemployed with indifference. That is a travesty of the truth. He did not mention our training assistance and training programmes. However, despite the fact that we are now coming out of the recession and production will start to increase, we must face the fact that large firms will not mop up as much of the unemployment as one might imagine. It will be very difficult for large companies to do that because the advent of automation and robots displaces labour. The Government must reflect on the fact that, with the current high unemployment, now is not the time to reduce the number of servicemen in the forces. We could do that when the unemployment figure has been brought under control.
We must look to and depend on our smaller companies to solve the unemployment problem. Those companies have been helped. As my noble friend the Minister said, the base rate has come down from 15 per cent. to 6 per cent. My right honourable friend the Chancellor has made a move towards insisting that the banks, and the building societies for that matter, pass on base rate reductions to their customers. In many cases that is not being done. In many cases the banks and building societies increase their profit margins. If there is a one point reduction, they give their customers a reduction of only a half point. That is not right. Corporation tax was 52 per cent. and is now 33 per cent. It is the lowest in Europe.
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The small business corporation tax is down to 25 per cent. Also, of course, we shall not suffer from the so-called social chapter.
But smaller companies have problems. They are mainly cash flow problems. I know many companies which are profitable but which could go under because of their cash flow problems. In many cases, the banks charge exorbitant rates of interest. A company may have an overdraft of £100,000 and be paying interest at three or four points above base rate. If the company wants to increase that overdraft to £150,000, the chances are that the uplift on the whole of that amount will be six or seven points above base rate. Some companies are paying 22 per cent., 23 per cent. or 24 per cent. interest, and that is wrong. That is one of the factors affecting their cash flow.
Late payers also affect companies' cash flow. Some of the worst late payers are government departments, local authorities and public organisations. A small businessman may have a staff of five, 10 or 15. His cash flow is vital. He needs it to keep in business. The time has come for the Government to consider the imposition of mandatory interest after the terms of credit have expired. If one does not pay one's VAT on time, the Customs and Excise charge 10 per cent. If one has a VAT liability of £100,000, the Customs and Excise want £110,000 if one pays late. Let us imagine that onerous burden on a small company. If we are to help small companies, let us help them in a positive way.
I hope that in his Budget my right honourable friend the Chancellor will again look at capital allowances. He increased them to 40 per cent., and then one has 25 per cent. on the reducing balance. It takes nine to 10 years to get back one's money or to charge it against one's profits. We should have a straight line: 40 per cent. in the first year; 30 per cent. in the second year; and 30 per cent. in the following year. In three years a company will have written off the sum.
We have 3 million people self employed. The number of self-employed people has grown tremen-dously over the past few years, mainly because of redundancies and so forth. There was a good article in the Daily Mail yesterday. I do not know whether your Lordships have read it. It was about the self employed. The simple answer suggested was that if all the self employed took on one person, the unemployment problem would be solved. I accept that that answer is too simple. But the article suggested that considera-tion might be given to allowing the cost of domestic services, child minders and so on, against personal taxation. That could help.
In the City a new organisation has just been set up. I was delighted to hear my noble friend Lord Skidelsky refer to it indirectly. It is called the City Group for Smaller Companies (CISCO). I have a vested interest in that I happen to be its president. It wants to help the smaller companies. There is a strong rumour that the Stock Exchange is to get rid of the unlisted securities market. Let us take access to capital. If the company is big it can have a rights issue. It will be all right. All its shares are quoted in the Financial Times, The Times and other newspapers. If

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the USM is cancelled the small company's access to capital disappears. That affects some 1,500 com-panies, as I am sure my noble friend will agree.
The City Group for Smaller Companies will try to remedy the lack of understanding of the City's role in the raising of money. Many small companies have no idea of how to go about raising money in the City. My noble friend the Minister referred to that point when he opened the debate. No one denies that there are difficulties in our economy, but pay awards are down, the 20 per cent. to 25 per cent. reduction in the exchange rate helps our exports; and exports are increasing. In the Autumn Statement the Government said that they would curb public expenditure. I was delighted to hear that that does not include capital expenditure, because it would be folly to cut capital expenditure.
I agree with the noble Lord, Lord Callaghan, my noble friend Lord Gilmour and other noble Lords, that this is not the time to be increasing taxation, direct or otherwise. Let us do it when we are a little more affluent. I believe that the Government should look at child benefit. There are many people receiving child benefit who should not do so. It should be taxed. I would rather help people with children who are on low incomes.
There are other arguments about the economy. Retail sales are turning up. The increase has not been dramatic, but it is happening. Production is turning up. Exports are up. Car sales are up. We should stop being gloom-mongers. There is a hard road ahead. No one denies that. But there are clear signs of recovery, and we should stop denigrating our achievements.
7.18 p.m.
Lord Holme of Cheltenham: My Lords, I must start with an apology to the House, in particular to the Minister. I fear that I misjudged the starting time of the debate and the spacious course that it would take. Consequently, I shall have to leave before the winding-up speeches to attend a long-standing engagement.
I take it as axiomatic that in a modern industrial democracy successful and effective economic policy rests upon two pillars. The first pillar is that of fiscal and monetary policy which sets the macro-economic conditions for success. The second pillar is an industrial policy which, at the micro level, makes it possible for industry and commerce to thrive. Those two must go together. My criticism, which I should like to share with your Lordships, is that the first pillar of fiscal and monetary policy has been faultily constructed; and the second pillar, of industrial policy, has been neglected and allowed to crumble. It is therefore not surprising that we do not have an economy in which any of us can take any pride or satisfaction.
I shall turn first to fiscal and monetary policy. The noble Lord, Lord Gilmour, in his brilliant maiden speech which, like other Members of your Lordships' House I greatly enjoyed, as well as being educated by, said that he thought the Government's fiscal and monetary policy had, by inadvertence, arrived at more or less the right place. Other noble Lords appeared
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disposed to agree with that; that is, those who are critical of what preceded it and those who, by and large, are disposed to defend the Government.
I am afraid that I do not take such a complacent view of where we are today on fiscal and monetary policy. I defy anyone to identify clearly the main thrust of those policies. It is quite obvious that the markets are completely confused, even though some of your Lordships may be clear. For instance, are the Government minimising inflation or maximising growth? Of course, the Government would like to do both but one cannot maximise everything. Which is the subordinate aim and which is the primary aim? Are the targets which matter most those on inflation or the growth projections on which so much depends? Are the Government determined to be a model of fiscal rectitude able, without raising interest rates, to sell the massive volume of gilts which they need to sell to cover our vast deficit?
I wonder whether noble Lords are aware that the projected £50 billion PSBR amounts to the Government of this country borrowing during the coming year £50 per week for every household in Britain? Of course, many gilts will have to be sold by the Government to cover that vast volume of borrowing. Naturally they do not want to raise interest rates, and in that case they must give clear signals of their intentions to the market.
Do we have a Government which wants to be fiscally proper, or do we have a Government of strong nerve gamblers who are willing to risk all on an immediate dash for growth, including even lower interest rates and a further depreciation of the currency? The answers to those questions are not clear, either to the markets or to the general public. Ever since Black Wednesday and that extraordinary departure from the ERM—and I have been amazed by the glib way in which the Government have sought to turn a historic and devastating defeat into some kind of victory for economic policy—there has been no framework for a monetary and fiscal policy which is understood by the market and investors alike.
However embarrassing it may be to the Government, which we know are divided on the matter, will the Minister give a clear statement about the Government's intention to re-enter the ERM at the earliest opportunity? I understand that given today's economic condition in Britain the earliest opportunity may be a matter of years rather than months. However, it is crucial to know whether it is the Government's intention to re-enter the ERM. We know that they have difficulty in answering the question because of embarrassments within the Conservative Party on the European issue. However, we cannot get through the next 12 months without a clear statement of intention. It is one of the only potential sources of stability, to which the noble Lord, Lord Skidelsky, referred.
I hope that it is the Government's intention to re-enter the ERM because it would give an indication of the policies which should be pursued during the intervening years. It would give some scope for the international co-ordination of action, which is indispensable for a medium-sized economy such as

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ours in an interconnected world. I hope that it is the Government's intention to re-enter because a single currency is a natural extension of a single market. I hope that the Government will make it clear that it is their intention to re-enter because if they do not there is a real danger that the famous train about which we have heard so much will leave the station without us.
I say that not for the usual hackneyed reasons that we have discussed so often. I say that because next month there will be an election in France which the parties of the right are expected to win. Your Lordships will be aware that in France the nationalist right and the European right are two different parties which co-exist within one party as we have in Britain. The two parties have come together in a coalition for the election. They have made it clear that if they win, as is likely, they will press ahead with negotiations with the Germans to try to form an inner core Euro-mark group of some kind. It is impossible to predict what it will be called but there will be an inner core European currency.
We should reflect for a moment on what that means for us. For patriotic and traditional reasons many people will believe that the pound sterling will eventually hold its head up high. But the truth is that we have a world in which there are three major currency blocs; that is the yen, the dollar and a new inner core European currency. Sterling will be a small cork bobbing on a stormy sea. It will always be the first target for speculators. One of the ways of dealing with that is for the British Government to give a clearer lead in regard to their intentions and to fortify the Germans in particular, who are still open to the possibility of a larger European currency grouping. That may not be the case for much longer if the Government party, for reasons of their own embarrassment, continue to turn their back on that possibility.
Of course, that is not the end. As John Maynard Keynes pointed out, there is an issue of confidence and in the end it depends on the animal spirits derived from confidence. Will people invest? Do they believe that things will get better? I hope that I shall not disappoint the noble Lord, Lord Clark, if I become political for one moment. My noble friend Lord Jenkins said that he would not talk about the Chancellor of the Exchequer, but I am bound to do so for just a moment. There is attached to the Chancellor what the markets call a reverse premium. It is difficult to tell what Mr. Lamont is worth. Is he worth 10 cents. against the dollar, 15 pfennigs against the deut-schmark or 100 points in the market? Those are the amounts by which our currency would strengthen and our markets would rise if the Chancellor of the Exchequer were to do what he should in honour have done after Black Wednesday; that is, to resign. There can have been few Chancellors who have had it in their own hands so directly to improve confidence. If the change that will be made were made earlier rather than later that would be widely supported and the Government's position would be strengthened. If the change were made it is important that the ambivalence
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about Europe, which is apparently necessary to the party opposite but which is fatal to our economic prospects, is at the same time brought to an end.
The noble Earl, Lord Caithness, and other noble Lords have referred to inward investment. That has been one of the success stories of the past 14 years. Indeed, I am tempted to say that the only industrial policy of the Government during the past 14 years has been to attract inward investment. However, I wish to warn your Lordships that complacency on the subject is inappropriate. The figures for the past few months show that inward investment is drying up very fast. The reason for that has nothing to do with the skills of working people, nothing to do with British industrial relations and nothing to do with the incentives offered to workers. The reason that inward investment is beginning to dry up is that the inward investors, in particular the Japanese, are no longer confident that we shall be inside the European Community in a full way.
The other pillar to which I briefly referred and to which I wish to return is the need for industrial policy; an "industrial strategy", if you will. They are two words which, during the Thatcher years, we were not allowed to put together; it was the strategy that dared not speak its name; and yet every other industrial country has some kind of industrial policy or strategy. Other countries do not believe that the invisible hand can wreak miracles.
There are a number of elements to a proper industrial strategy: there is the infrastructure investment, to which my noble friend Lord Ezra referred; and there is the need for a sectoral strategy, particularly on research and development, in those residual areas of manufacturing where we are still strong. I give as examples only, because fortunately there are a few others, pharmaceuticals, speciality chemicals, aerospace, computer software, publishing and in particular English language publishing. There are still areas of strength for this country. Within the limits of what the Government can do, they all deserve the greatest possible focus and help, particularly as regards R&D.
There is the question of refreshing our skills. I am glad that several noble Lords referred to the 1 million long term unemployed. I was struck by some of the ideas which the noble Lord, Lord Skidelsky, put forward. The noble Baroness, Lady O'Cathain, is right; there is structural change. However, it is unforgiveable that 1 million of our fellow citizens are long-term unemployed. That is not just a threat to our consciences but a threat also to our economic future.
At the level of industrial policy there is a need for competition. I have been slightly disconcerted by one or two voices on this side of the House which have appeared to want to throw out the baby of competitiveness and competition and a response to market forces along with the bath water of failed government economic policies. It is essential that we remain competitive and that the object of our policies is to sharpen our competitiveness rather than to discard it.
Finally, on the question of industrial strategy, there is a clear need for Britain, with its historic educational

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achievements, to be an added value economy and to be a relatively high quality economy. All over the world in major companies a quality revolution is taking place. It is true of some British companies and should be true of more of them. The design, performance, engineering function, delivery and service should be of the highest possible quality. Although I regard it as only a step in the right direction, I believe that, as regards public services, that is what the Government are trying to achieve through the Citizen's Charter. If we are to have an industrial future, it is essential that the culture of this country should be one which supports quality rather than one which, as it has done in the past, supports second best.
The Prime Minister is in Washington and we understand that he is going to talk to the President about free trade. I hope that the President will listen carefully. It would be a disaster for the world if the Uruguay Round of GATT were not completed. I hope that the Americans will be fully responsive to the need to turn their back on protectionist policies and to embrace the policies of free world trade.
However, I hope also that when the Prime Minister is there he might ask Mr. Clinton about his own economic presentation that he has made recently and in turn listen to him, because it is quite clear that in the United States we have new leadership which is pledged to action. It is basing that action on shared sacrifice by everybody in American society and it is based on a clear strategy. I believe—it may be an unfashionable view—that the British people would respond to a similar challenge from the leadership of this country. I fear that the tragedy is that they will not be given such a challenge by the party opposite.
7.35 p.m.
The Earl of Longford: My Lords, in the course of his interesting speech, the noble Lord who has just spoken called on the Chancellor of the Exchequer to resign. I shall not become involved in that personal issue but perhaps I might pass on, through the noble Lord if necessary, a piece of information that came to me when I resigned from the Cabinet a good many years ago. The late Lord Salisbury, the then Leader of the Opposition here, wrote to me to say, "It is never the right time or the right issue, so you will be told, on which to resign but if you do resign you will never regret it". The noble Lord may wish to pass that on to the right honourable gentleman the Chancellor of the Exchequer.
Like other noble Lords I am grateful to the noble Lord, Lord Jenkins of Hillhead, who opened this debate in his usual distinguished fashion. I join in the congratulations to the noble Lord, Lord Gilmour, who trod a very skilful path. He was determined to observe the conventions of the House while making plain his distaste for much of what has occurred under Conservative governments in recent years. I believe that he said—it seemed to be his message—that in the Thatcher years "the rich got richer and the poor got poorer". He seems to have arrived at some kind of satisfaction with the present Government, but I see no reason to suppose that that tendency has been reversed at all. I hope that the noble Lord will consider
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that point before he further endorses this Government. It goes without saying that in this House we shall always wish to hear from someone like the noble Lord.
I hope that I shall be allowed a few words of personal reminiscence which will bear on what I want to say about the present situation. In 1930–32, as a young innocent fellow just down from university, I worked in the Conservative research department. I meant no harm to anyone. In those days there were no Conservative economists so I was presented as the next best thing. Between 1932 and 1936 I made my way into the Labour Party. It was not one of the most spectacular conversions compared with that of my dear friend the noble Lord, Lord Prentice, who served first in a Labour Government and then in a Conservative Government within quite a short space of time, which was far beyond my powers. In fact, the noble Lord, Lord Jenkins, has played a very distinguished part in three parties in the past few years, which must be almost a record. The noble Lord is well versed in history and I wonder whether he can tell us whether anybody has been a leader of three parties in such a short space of time or any space of time. I shall leave the noble Lord to cope with that when he winds up the debate.
I was looking at the matter this evening from the point of view of an innocent, well-meaning young man with a good degree down from an eminent, ancient university wondering which party to join. What would incline such a person to join the Labour Party? Obviously he will not join the Conservative Party because I think, by common consent, they are the most helpless government in the history of government. I am not saying anything against helpless people. It is not a vice to be helpless. It may be rather pathetic and may arouse compassion. I have met no Conservatives outside this Chamber who have not said something to the same effect, unless they are on the payroll because those people are in a different position.
However, that does not necessarily put everyone against the Conservatives. I met an elderly lady recently—she was not as old as I am because no one is these days—who said to me, "I like this Mr. Major. He obviously has not the slightest idea what to do and yet there he is, as cheerful as anything". What used to be called the duty of cheerfulness is clearly one of the Prime Minister's virtues, and perhaps that appeals to the electorate. Therefore, I shall not discuss the matter as an election agent and argue whether or not he is popular in the country. I believe that we can all agree that he is a well-intentioned man.
Let us suppose that a young man is very idealistic and intelligent. In that case, he would clearly rule out joining the Conservative Party because he could not have any sympathy for its helplessness or the policy of making the poor poorer and the rich richer.
For many years after the war under various governments, both Labour and Conservative, the national income was distributed in a fairly equal fashion. However, since Mrs. Thatcher came to power the national income has been distributed in a less and less equal fashion. In the old days when I was a

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Conservative—a hundred years ago or whenever it was—that would have been considered a good show. I remember a leading article in The Times that pleased us in the Conservative research department. The article said that unfortunately wealth is like heat. It is only when it is unequally distributed that it performs what the physicists call work; in other words, that is the doctrine of inequality of wealth as against equality of wealth. The Conservative Party achieved a more equal distribution of wealth under the great Conservative leaders such as Mr. Macmillan and Mr. Butler, as they were then.
The young man I have mentioned will be tempted to follow the noble Lord, Lord Jenkins. He must feel that the Chancellor of Oxford University must know something. He would undoubtedly be attracted to the noble Lord on personal grounds. However, he may wonder whether the noble Lord is still on the move and whether there is a danger that the noble Lord might join a fourth party in the next few years. I think, therefore, that he will rule out the prospect of following the noble Lord.
Therefore, the young man is left with the Labour Party. When I decided to join the Labour Party I was convinced that it was the party with the highest Christian ideals in regard to us all being equal in the sight of God. However, I could not make up my mind whether a Labour government would be capable of running the country. The Labour Government of 1929 to 1931 was not a good advertisement for the party. People have said that I decided to join the Labour Party after having attended a fascist meeting. However, that is just a silly legend. I came to the conclusion that the Labour Party would be at least as competent as any alternative. I decided the Labour Party's policies would result in far more social justice than the policies of any other party. However, I cannot think that my young friend would not consider the Labour Party to be a more competent party than the party now in power. I like to think that the Labour Party would rule more efficiently than our present extremely incompetent rulers; but, there again, would that be the case?
Although I believe the Labour Party would be a big improvement on this Government, I do not think it could emerge tomorrow with the kind of policies that we in the Labour Party would hope to see emerge eventually. I have great personal confidence in John Smith, although I have only met him once. He does not need my confidence in him. He is a Christian Socialist. I also have great confidence in his principal colleagues, although I do not know them personally. However, I do not think for one moment that if they were elected tomorrow it would be sufficient for them to say, "We are socialists and everything will turn out all right". A policy must be worked out. That policy must not be one that is based on extending the powers of the state if in doubt. It certainly cannot be a policy based on this dreadful market system that we have discussed at length. The policy must to some extent be a new one. Is that a betrayal of the principles of Beatrice and Sidney Webb; and if so, is it something too horrible to contemplate?
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I am a Roman Catholic and I am aware that the Catholic Church never changes; it just develops. It sometimes develops in quite a big way, as occurred at the time of Vatican II. I look forward to a big development in the Labour Party in the next few years under the leadership of Mr. John Smith and his colleagues. If my young friend cannot make up his mind tonight, I am sure he will be able to make it up before very long.
7.44 p.m.
The Earl of Halsbury: My Lords, in years gone by I was a consultant on, among other things, control engineering. I ask your Lordships to excuse me if I use some of my own lingo in discussing the matters before us this evening. By a transient I mean what happens when you tread on a banana skin. By transient response I mean the time it takes to recover from doing so. By a disturbed system I mean that you tread on a banana skin, stagger into a lamppost and fall down a manhole. The transient response between transients is a continuous process. A non-linear system is one in which effects are not proportional to their causes and may occur after a delay in time.
From that point of view an economy is a highly disturbed, non-linear system. It is possible to study it with a computer; and we have three models, all of which give the wrong answers. There is the Bank of England model, the Treasury model and the London School of Economics model. Wynn Godley's model at Cambridge always came up with the right answers, as a result of which he was shut down and his school ceased to exist. The economy is never in equilibrium although it may appear to be from time to time. By equilibrium I mean that the expenditure on consumer goods equals their output at full employment and the expenditure on capital goods at full employment equals the sum available for investment.
Processes like automation do not show up on the flat averages that you get when figures are reported. Automation is a somewhat vague term. It really stands for the advancing front of production engineering. But the sub-cultural effects, on the lines described by my noble friend Lady O'Cathain, get obliterated by this averaging process. The Government and the Opposition hurl average figures at one another intemperately across the table. What I find most discouraging is that neither appears to know the least thing about what they are talking of; nor for that matter do I, save in the most general terms.
Inflation is due to too much money chasing too few goods in an economy at full stretch. Further demand will be met by excessive imports and will depreciate a floating currency, leading to further inflation. Inflation can start anywhere but it always ends as wage inflation, the effects of which go on progressively after their causes have ceased to operate. That is the non-linear factor. That is the phenomenon known as stagflation; rising prices in a stagnating economy, with high unemployment.
The Government's self-congratulation on keeping inflation down is just vain boasting. They have done nothing to achieve that except do nothing. Inflation is

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tapering off as it would have done anyway in the absence of any transient which set it going again. Meanwhile the system stagnates in a lower key.
Governments, either directly or through local government to whom they make grants, are the grand patrons of infrastructural investment. The motto is: borrow, burrow and build at road intersections; any form of capital investment which will be inherited by posterity, who can pay the interest on the capital invested.
I have said this before. I have written a letter to The Times and it has published it. I repeat myself. We have 250 years of environmental mismanagement to rectify. We have inadequate roads and road junctions. We have out-of-date housing stock, schools, hospitals and prisons. Against that there are 3 million unemployed waiting for jobs, of whom 1 million are long-term unemployed; and the construction industry is at a standstill. Can you beat that? What are we doing about it? I know a young man who started his own business and obtained a wonderful contract to rebuild a large quarter of a substantial city. He has fulfilled the contract and he is awaiting his profits. But he has an empty office block on his hands, on every window of which he has painted "To Let". There are no lessees. What can he do but apply for liquidation? Yet there is a young man in the full flush of his youthful strength, with ideas and talent. What he has built is a great credit to him, but his company is in liquidation. Lists of bankruptcy rates are published in the newspapers and ventilated in Parliament. It all makes no difference.
The noble Lord, Lord Callaghan, asked what is government policy. I can say what government policy ought to be. First, it ought to be the Docklands railway. Why have the Government been dithering for more than a year over it? Why not get on and build it? Then there is my own hobby. I call it my own hobby, but I did not invent it. It is an old project: the 300-foot contour canal. That would be a canal built right round the Pennine chain at the 300-foot level. It would be a wonderful means of communication, although perhaps slightly out of date. It would provide marvellous recreational facilities for fishing and boating. In addition, it could channel water from the water rich North West to the water poor South East. We could not build it all overnight, but the project could be a standby and every time there was a slump we could invest a little more in the 300-foot contour canal, and in 100 years or so time we would have it.
If one asked any economist whether in modern terms it would pay to terrace agricultural land such as one sees in mountainous districts where the hillsides have been terraced, he could prove that it could not possibly do so. But it has been achieved through the patient labour of generations. Why should we not do something like that?
How would the 300-foot contour canal be financed? I would treat that in the same way as money is raised in wartime. What happens when one is at war? One has a war loan. Why should we not have a national recovery loan? I watched Roosevelt do that back in the 1930s. My old friend the noble and learned Lord, Lord Hailsham, said the other day that he had
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lived through the 1930s and remembered what unemployment was like in those days. I followed him and said that I had lived through the 1930s too, and I watched Roosevelt tackle the problem.
Roosevelt was a Keynesian. If one wants to know what Keynesians could do, one should motor from Birmingham to Wolverhampton and see the squalor caused by 250 years of environmental neglect on either side of the road. Take a look at the dereliction on the south-eastern approaches to Swansea. Go to Mansfield and see the coal tips of the last century all over the landscape. All that it needs is bulldozers and young men trained to use them.
The prerequisite is an earthquake to persuade the Treasury to separate capital expenditure from revenue expenditure. If one could take the whole of the nation's expenditure, through central government via local government, and separate the capital expenditure throughout from the revenue expenditure and then put it against the public sector borrowing rate, what would the economy look like then? Until the accounts are kept in such a way as to identify those figures, there is not the slightest hope of ever floating the kind of loan that I have in mind.
In the sphere of management I first took my seat in a boardroom where round the room was carved in the oak panelling the words "To manage is to foresee". There is no foresight in government circles. In case the Opposition might flatter themselves, if one changed them round there would not be the slightest difference. There would be exactly the same lack of foresight.
I say that in the certain knowledge that Keynesianism works because I have seen it work. I do not know whether I would be a Keynesian in a boom, but in a slump I am. That is what Keynes lived through and that is why he enunciated his theories.
7.54 p.m.
Lord Ogmore: My Lords, having listened to other noble Lords I am very glad that I have notes to which I can refer. I recognise the expertise of noble Lords who can speak without notes. It is an ability which those who do not try to make speeches do not appreciate.
When my father—who was one of those who could speak without notes, and I am envious of him in that respect—was in Parliament he dealt with economics, also in a ministerial capacity. That is not surprising in view of the link between the economy and electoral success. I am no economist in the literal sense and I suppose that I do not have an economist's brain, in the same way as Members of this House sometimes say, when discussing legal matters, that they are not lawyers. However, like them, I hope that one can adopt a commonsense approach to such matters without taking the expert's view.
Taking the commonsense view, I do not see how the Government can justify giving pledges to reduce taxation further when the fabric of the country is in such a sorry state. In the Tory party's enthusiasm to reduce government spending as a whole the vital need for investment in both people and infrastructure seems to have been overlooked. That is surely part of the reason for the present social and economic difficulties.

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No taxpayer wants to see the Government throwing money at problems, but with seemingly endless reports of schools, hospitals and railways in need of repair I cannot believe that those areas are suffering only from bad management. There surely must be a real lack of funds.
I believe that it is fair to say that unemployment, poverty and lack of hope among the people leads to a society which does not function in an acceptable manner. I acknowledge the argument that to raise taxes at this time may kill any "green shoots", but we must ask how we got into this position. Surely it would have been common sense to invest in education when government revenue was rising. How is it that the need for a highly trained labour force was apparently overlooked?
I am often told that we are now truly part of a world economy and will become even more enmeshed when the GATT round is completed, which we sincerely hope will be soon. But how are we to be prosperous if we are not trained to a level to compete with the most highly skilled countries? I cannot believe that the Government intend us to compete on wages with the third world countries. I only hope that future governments learn from the mistakes of this period of Tory rule for I am sure that noble Lords on all Benches wish to see a prosperous and harmonious Britain.
7.58 p.m.
Lord Marlesford: My Lords, we are indebted to the noble Lord, Lord Jenkins, for the opportunity for this debate. At the beginning of his speech the noble Lord pointed out that he regretted the demise of the period when unemployment was the death knell of governments. With the greatest respect, historically that is rather inaccurate. If one considers the period we are presumably talking about—the 1930s—in 1931 the Labour Party held only 50 seats. Between 1931 and 1935 there was a large increase in unemployment and the Labour Party won only 150 seats at the election. During the period from 1979 to 1983 there was a considerable rise in unemployment yet the Conservative Government of Mrs. Thatcher were re-elected with a significantly increased majority in 1983.
It is a myth which was very prevalent and which in a sense sustained for a period from 1945 to 1979 a well-intentioned socialist consensus of policies which did Britain no good at all. They were policies of wide public ownership, high taxation, growing trade union power, large numbers of strikes and falls in productivity.
When the noble Lord, Lord Callaghan, referred to the same period, perhaps because of the affection and respect in which we hold him, we found his arguments seductive. However, there is one point which it is important to remember. A myth can influence people even if it is a myth. If we build up with high unemployment a period in which many people feel alienated, there is a real danger to social cohesion in the country. As a party which supports the present
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Government, we must bear that factor in mind. It is why the Government are deeply concerned about unemployment.
We live in a grim world. I refer first to the outside world. The United States has had low interest rates of 3 per cent. over the past two years. Nonetheless, consumer confidence is ebbing again. Only yesterday the Governor of the Fed, Alan Greenspan, said that he believes that the United States economy may again undershoot. People are already having second thoughts about President Clinton's tax proposals. He also shows an unhealthy inclination towards protectionism.
Some of the methods that he is using to obtain support for protectionism worry me. Noble Lords may have heard the speech which he made this week to the Boeing workers in Seattle. He told them that the reason they were losing their jobs was the unfair competition from the European Airbus. That is total nonsense. The reason that they are losing their jobs is that there has been a huge over-supply of aircraft and airline places in relation to the world recession and as a result of the deregulation of the airlines. It is one thing for a candidate for the presidency of the United States to make such a speech, but for the President himself to do so is demagogic. I am not therefore optimistic about the achievement of a GATT settlement.
I do not agree with the noble Lord, Lord Holme, that the coming defeat of the Socialist Party in March in France is likely to lead easily to a unification of the German and French currencies. The French economy is in a bad way, with high unemployment and high interest rates. The French franc will be under considerable strain. I should not be surprised if a new French government were to take the opportunity to go for some form of radical decoupling from the ERM. It is possible that the Germans will be persuaded to change their own domestic policies. That could make the continued maintenance of alignment between the two currencies possible.
As part of the United States' policy to try to prevent the increased penetration of Japanese exports the American Government have been attempting with some success to push the Japanese yen up. If the value of the yen goes up much further, there is a danger of a Japanese stock market collapse because, as noble Lords know, the present level of the Japanese stock market is largely a result of government rigging.
The outlook in terms of the United Kingdom structure is both good and bad. Perhaps I may take the good part first. There is no doubt that foreign investment has been crucial. Foreign companies now account for about 15 per cent. of all manufacturing jobs and 28 per cent, of net capital expenditure. One thousand German companies have invested about £8 billion in Britain. Rather surprisingly, I noted recently that 50 per cent. of all personal computers sold in the European Community are made in the United Kingdom. Another great advantage lies in our not having the social chapter of Maastricht. Tributes have been paid, inadvertently to some extent, to that aspect by such people as M. Jacques Delors. It certainly helps

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to make Britain a more attractive place for foreigners to invest in than other countries inside the Community.
The areas in which our manufacturing has faded are a depressing factor. A stock analyst of my acquaintance has recently returned from Germany where he visited 20 German engineering companies in order to see the effect on them of the devaluation of certain ERM currencies. He found that there was no consequent competitive pressure from Britain but there was additional competition from Italy. The simple fact is that Britain cannot export goods that we do not make. It is certainly to be hoped that we are able to expand our productive base. I suspect that much of that expansion will result from foreign investment. The flip side of foreign investment has been considerable overseas investment by British companies and British finance. I do not believe that that matters. I am sufficient of an internationalist to be happy to see capital moving around the world wherever it is felt that it has greatest return.
I refer now to a major problem that faces the Chancellor. The Budget deficit is almost certainly unsustainable. The Government are likely to have to sell about £1 billion worth of gilts a week. That will be hard. It is more than net domestic savings. Therefore a tough fiscal policy is necessary; that is, more tax or less spending. I favour necessary tax increases. Unlike others, I favour indirect tax increases. They are less of a disincentive to effort. VAT is particularly appropriate because it has no disincentive on exports. It channels resources from domestic consumption into exports. Whether the change in VAT should be to broaden its application or to increase the rate I am not sure. I should like to see the vehicle excise duty increased to the level of the mid-1970s when it was at a price equivalent today of £165. An increase from £110 to £165 would produce a net revenue increase to the Chancellor of £1.2 billion but would add only 0.3 per cent. to inflation.
The efforts of my right honourable friend the Chief Secretary to the Treasury to reduce spending will not, I believe, lead to significant savings within the timescale. I am sufficient of a Keynesian to believe that there are areas in which greater ingenuity could be used in the public spending area. I give one small example. English Heritage is responsible for dishing out grants for the restoration of historical buildings, churches and so on. Recently it has had to cut its grants from 75 per cent. to 40 per cent. which means that much of that restoration work will not take place. If English Heritage were to receive increased funding, it would immediately result in widespread additional employment in small construction companies around the country, which could make all the difference between life and death. There would be no import content. It would involve employing more craftsmen in small building companies. That is an area in which I should like to see some ingenuity.
I still believe that the inflation target is crucial. Wages of course are crucial to that target, as is monetary policy. I wish to say a final word on clearing banks and the Bank of England. The clearing banks have shown that they are wildly inefficient. They are
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now having to cut staff and branch networks. They expanded their balance sheets too rapidly, notably by lending to wobbly businesses such as property companies and crooks such as Mr. Robert Maxwell. They encouraged many small businesses which were unable to differentiate between the desire of the bank to lend to them and the prudence of borrowing, so that those small businesses took on unwise debt. Amazingly, they failed to learn from their own property crisis of the early 1970s, and the bad debts for both the personal and corporate sectors have been disastrous. In 1991 Barclays' bad debts increased by 64 per cent.; the Midland's by 152 per cent. and the National Westminster's by 161 per cent.
I am optimistic that the takeover of the Midland Bank by the Hongkong and Shanghai Bank will be beneficial. The Hongkong and Shanghai Bank is a splendid bank and I have the highest regard for Sir William Purves, its chairman. He has the opportunity of introducing new practices and new standards of clearing banking in this country through the Midland, which will hopefully force the other clearing banks to follow suit.
I favour an independent Bank of England. But I recognise that this is not practical at the moment. I should have liked to see my noble friend Lord Lawson as the Governor of the Bank. I happen to believe that on balance—one must take these things on balance —he was a first-class Chancellor. He was one of the few who had a feel for the economy. He was extremely radical and gave us a tax regime which is now highly competitive in world terms. However, he is not the Governor. As the next best thing I welcome the fact that the present editor of the Economist, Rupert Pennant-Rea—for whom I worked as a lobby correspondent for six of his seven years—has been appointed as Deputy Governor. He is of the highest intellect, integrity and toughness. Those are qualities which have been lacking in the City of London.
If the Bank cannot be independent I should like it to have complete responsibility for monetary policy, but under the guidelines laid down by the democratically elected Government. That is to say, the Chancellor, who is responsible to Parliament, should publicly say what the Government's strategy is and leave the operational decisions on monetary policy to the Bank of England. That would be a great deal better than having three separate groups, Treasury officials, the Chancellor and Ministers and the Bank, all muddling around with monetary policy. As a corollary to that it would be necessary to split away the regulatory function of the Bank of England, which it has not performed well. It is a role which is increasingly important and regulation is a big enough task to be made quite separate from that of the Bank.
I conclude by referring to the interesting question posed by the noble Earl, Lord Longford—he is not in his place—as to which party a bright young graduate who is thinking of going into politics would join. I suggest that he would wish to join the party where the action is, where there is the minimum ideological baggage and where there is an opportunity of exercising influence. That of course would be the Conservative Party.
8.13 p.m.
Lord Ewing of Kirkford: My Lords, I have been privileged this afternoon to sit through the whole of the debate and listen to a number of outstanding speeches. In that regard I pay a warm tribute to the maiden speech of the noble Lord, Lord Gilmour. Perhaps I may reminisce for a moment to say that when he and I were both in the other place there were a number of Members on both sides who, when they spoke in the Budget Debate, filled the Chamber. The noble Lord, Lord Gilmour, was one such Member. I can remember clearly when the noble Lord, Lord Lawson, when Chancellor, reduced income tax. The noble Lord, Lord Gilmour, objected to that reduction and I can remember to this day the phrase that he used: that governments should reduce taxes when they can and increase taxes when they have to.
A number of noble Lords argued today that it is not yet time to increase taxes. It may not be yet, but it is not far off. That is an absolute certainty. When I was listening to the noble Lord, Lord Clark, arguing that there should be no increase in taxation in the coming Budget I was conscious of the fact that in four or five weeks' time I shall be listening to him again, but justifying why there have been increases in taxation in the Budget.
The Government are already committed. The noble Lord who has just spoken asked for an increase in vehicle excise duty. The Government are already publicly committed, both in this House at the Dispatch Box and in the other place, to an increase in vehicle excise duty in the coming Budget. Indeed, when the Chancellor announced the abolition of sales tax—the 5 per cent. that remained—he made it clear in that Statement that he would recover the shortfall. That measure was announced in order to stimulate the sales in the car industry. He made clear in that Statement that he would recover the shortfall in the Budget by increasing vehicle excise duty. When we sifted in this House for a figure the noble Earl, Lord Ferrers, was kind enough to tell us that the increase would take vehicle excise duty to £160.
That is a substantial increase. Those that have been singing the praises of the performance of the car industry today must look forward with some trepidation to the injury that such an increase in vehicle excise duty will do to the productivity in the car industry. I hope that if Ministers on the Front Bench opposite do anything it will be to convey to the Chancellor that whatever he does in his Budget, or whatever he does not do, he must not further damage the industrial base of this country, which has been so badly damaged that it is almost non-existent.
I was interested in the opening speeches. As I listened to the Minister replying to the noble Lord, Lord Jenkins, a famous quote from the great Nye Bevan came back to me. At the outbreak of the Second World War there was a discussion about digging trenches. Nye Bevan said, "If I was digging trenches I would not dig them straight. I would dig them zigzag and I would hope that when the shells fell in the zig, I was in the zag". For every shell that fell in the zig from the noble Lord, Lord Jenkins, the
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Minister was in the zag. I have never seen a Minister avoid answering a noble Lord's speech in such an elegant way; sidestepping almost every issue.
I am grateful to the noble Lord, Lord Jenkins, for promoting the debate. I was interested also in some of his comments, as my noble friend Lord Callaghan said, about his old comrades. I was interested in the new political philosophy that the fact that there has not been a resignation among Government Ministers, against the background of all the mismanagement, is the fault of the Opposition. It seems that the Opposition are now responsible for imposing ethical standards on Government Ministers! We will take responsibility for many things but I do not believe that even the noble Lord, Lord Jenkins, would expect the Opposition to be responsible for imposing ethical standards on this Government's Ministers.
It may be that I misread the terms of the debate. Only the noble Lord who has just resumed his seat mentioned the social aspects of the effects of the Government's economic policy—the danger to the social cohesion of the country. Perhaps I can come to that in the course of my remarks without detaining the House for too long.
We must look at the facts as they exist and not as we believe they should be. At present this country has the highest level of unemployment—3,030,000 recorded. But we all know that it is much nearer 4 million. We have the highest level of long-term unemployment—1,030,000. Of the total 3,030,000 unemployed, 1,030,000 have been out of work for more than a year. We also have the highest number —over 1 million—of mortgage holders whose mortgage value is greater than the property on which the mortgage was first taken out. Added to that, we have almost the highest crime figures on record.
I do not appear here—or indeed anywhere else—as a moral judge; but we have the highest marriage breakdown rate per head of population that we have had for a great number of years. To add insult to injury—injury to injury may be the best way to put it —we have the highest psychiatric referral rate per head of population since the inception of the National Health Service. I hope that no one will tell me that that is a combination of factors that a government can ignore. No government can ignore such a combination of factors and their effect on the social cohesion of the country. It is a disgrace that nearly 4 million people are unemployed.
The noble Baroness, Lady O'Cathain, will consider that she has had a fair share—perhaps even more than her fair share—of attention against the background of the much better defence of the Government that she made than did the Minister. She was absolutely expert. I expected her and the Minister to change places at any minute. She made an expert defence of what she saw as the Government's position. From her point of view she quite rightly referred to her experience working for British Leyland at a time when industrial relations were quite bad, to put it mildly, and some would say appalling. I do not back off from that. I am a devout trade unionist and do not back away from the situation that prevailed in the winter of 1978 and the early months of 1979. At that time I had

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the honour to be a junior Minister in the government of my noble friend Lord Callaghan, and I described the winter of discontent as the worst example of man's inhumanity to man that I had seen.
I wonder what the noble Baroness would make of what is going on now. One can give a number of examples of what is happening in the country at the present time. What do the Government intend to do about such situations as the one at Timex, in Dundee, where the chairman and managing director deliberately provoked a strike? They told workers that they would need to accept a pay cut and give up all their fringe benefits. They deliberately provoked a strike and sacked the workers as soon as the strike was called. They also sacked those who did not go on strike. The company is now in the process of seeking to recruit a new workforce at much lower wages than the workforce that was sacked, and with no fringe benefits.
On an international level consider the situation in relation to the Hoover Corporation. It went to Dijon in France and said to the French workers, "Take a cut in wages and give up your fringe benefits. We will close the Cambuslang factory in Glasgow and transfer the work here." Hoover then went to Glasgow and said to the Cambuslang workers, "Take a cut in wages—a deeper cut than your French colleagues—and give up all your fringe benefits. We will close Dijon and bring the Dijon work here." That is what happened.
Take the Government's own position. It was announced that 31 pits would close. There was no consultation. The miners' union had to go to court to obtain legal enforcement because British Coal and the Government had not even gone through the legal procedures required. Management had not even gone through the legal procedures before announcing the closure of 31 pits.
I say to the noble Lord, Lord Jenkins of Hillhead, that the difference between the last Parliament and this Parliament is the Government's majority. Had the Government had a majority of over 100, by this time those pit closures would have been bulldozed through Parliament. As an aside, so also would the ratification of the Maastricht Treaty have been bulldozed through Parliament. Governments with small majorities cannot do what governments with large majorities can do. This Government's problem is that they are having great difficulty coming to terms with the fact that they have a small majority. They are finding it difficult to manage even their own business, let alone the nation's business, in the kind of situation in which they find themselves.
The difference in the structure of unemployment is also interesting. When the next election takes place the difference will be that, whereas in general elections up to the present time only one member of a family has been unemployed—and in some cases of greater hardship perhaps two members—at the next election whole families will be unemployed. That is the way the unemployment figures are moving and will continue to move, certainly throughout the whole of 1993. That will be the difference when we come to the next election.
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The noble Baroness made one point with which I agree; namely, the structural change that has taken place in the age make-up of the population of the United Kingdom. What have the Government done about it? It is suggested that people should buy private insurance in order to fund their own pension when they reach retirement age. In this country there is not at present a man over 45 years of age or a woman over 35 years of age who could buy insurance that would provide them with an adequate pension when they reach pensionable age. So the Government have done no preparatory work to cope with the structural change in the age make-up of the United Kingdom.
I turn quickly to the social consequences. Those who predict social unrest in the country because of high levels of unemployment and deprivation will be the victims of their prophecy coming true. The only reason I sound this warning is because the threat is on the horizon. Throughout the length and breadth of the country there is a complete lack of regard for the police force, law and order and an organised society. That used to be so in isolated pockets and it was thought that the problem could be contained, but it is no longer isolated.
Let me repeat to Government Ministers, lest they be tempted to warn those who speak as I do, that one should not make such predictions because that is the way to stir up trouble.
In conclusion, I refer to the words of Martin Luther King. While imprisoned during one of his civil rights campaigns, a dozen or so of his fellow clergymen wrote to him. They pleaded with him to stop disturbing the peace and stop causing tension. Martin Luther King's reply should be placed on the desk of every government Minister: "Peace is achieved not in the absence of tension but through the presence of justice". The problem in this country is that the Government have heaped injustice upon injustice on the people of this nation and that is why we now face this crisis.
8.29 p.m.
Lord Beaumont of Whitley: My Lords, we come to the last bend in this very good"debate. We have heard a number of first rate speeches—some almost unexpectedly good—from Members of the House, which have produced new points and new experiences. What we failed to hear, at least until the last speaker, was much emphasis on the social side. This is a debate about economic and social consequences. I wish to join the noble Lord in speaking about those social effects.
Today, as many of your Lordships are aware, is Ash Wednesday. While of course I speak as a Liberal Democrat and, as is the convention in your Lordships' House, I speak for myself, I also speak once again, as I have before (with permission) on behalf of the Church Action on Poverty, to voice its concern on the matters which arise from this Motion. Lest anyone should imagine that Church Action on Poverty is a bunch of crazy heretics from the Marxist Left, I would remind your Lordships that it was founded by officers of the Board of Social Responsibility throughout the dioceses, who are not noted for extreme radicalism.

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The movement started within that wild revolutionary body, the Church of England. Besides myself, the executive body has on it representatives of many of the free Churches and superiors of Roman Catholic Religious houses.
I would remind the House that representatives of Churches are particularly qualified to speak on the social effects because, almost uniquely among those who serve the poor, they live in some of the worst parishes in this land. Teachers and social workers do a fine job but most of them go home in the evenings. The clergy, it is true, probably have decent houses but they are stuck there among the muddle of poverty, squalor and, above all, the crime of the urban priority areas of London, Liverpool, Glasgow and Newcastle. It is those people who have asked me to speak in your Lordships' House on the social and economic consequences of 14 years of rule by this Government.
There is the feeling not only of a failure to support manufacturing industry, but also of efforts having been made, in the attempt to destroy trade unions, that have destroyed manufacturing. There has been the failure to realise that the main industrial powers in the world, Japan and Germany, know that organisation of the economy needs state intervention and support, and that domination of industrial organisation by the stock exchange is not a good idea. Another policy of this Government to which I have to draw your Lordships' attention—it has already been mentioned by other noble Lords although some of them have not deplored it but have praised it—is the opting out of the European effort by encouraging low wages and conditions, thinking that we can win by under-bidding Germany. We will never win prosperity by under-bidding Germany, because we cannot under-bid Korea.
The resulting mess made by these economic policies has left us in a position where we should at least look after the suffering and the casualties. We have a situation where benefits for the unemployed are too low for a healthy diet, where the increase of loans in the administration of the Social Fund leads to indebtedness, driving more and more people into debt, where there is little effort made to avoid the poverty trap, where there is appalling neglect of the welfare of 16 and 17 year-olds, and where there is a shift towards indirect taxation which invariably hits the poor hardest. I was horrified to hear one or two noble Lords come out in favour of that. There has also been complete neglect of low-cost housing over 14 years and even the policy of buying houses has been a disaster which is pushing more and more people towards the poverty area. Any "goodies" that are going, such as mortgage interest tax relief, go to the better off.
What is the result of this? At this stage I should like, if I might, to sum up in the words of the chairman of Church Action on Poverty. I quote:
"All of these aspects interconnect to hit some sections of the population and some areas with particular severity. Some whole boroughs, for example, and certainly whole neighbourhoods have high rates of unemployment and, where people are in work, they are in unskilled or semi-skilled low-pay jobs with little security. There is no spending power.
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Therefore there is no incentive for investment, e.g. for retailers or house builders. This in turn prevents employment opportunities increasing. People who are mobile and more skilled leave the area for parts of the country offering better prospects"—
or which they think will offer better prospects.
"The population that remains is more expensive for the local authority—it may have tipped towards a higher proportion of elderly, young children, lone parents—so that there is a greater call on need for social services, etc. Schools with a high intake of children from deprived backgrounds will be at a disadvantage in terms of test scores and exam results … Ambitious parents will send their children elsewhere, so starting another vicious circle. There are no jobs for young people to go into and therefore some of the more able ones leave. Even training schemes suffer because too few are employer-based ones and motivation suffers when post-training prospects are so poor. Young men become hopeless and are more likely to drift into some form of anti-social behaviour—drug abuse, crime, vandalism, joy-riding. Young women have babies to have a role in life and establish their independence. The social fabric that once aided young people's adjustment through adolescence to adulthood through employment has frayed and lost its structure.
Instead of recognising the real structural problems in this sort of situation and having policies which will encourage investment, employment and improved social and physical infrastructure, the reaction from government has too often been one of blame. Blaming the unemployed; local authorities; parents; teachers—and of course the churches for not giving a moral lead!"
It is of course not all the Government's fault. There are world problems to combat and we all know that. Some politicians are trying hard to find out how to solve those problems and how to come to terms with the inevitable. This Government are pursuing a positively harmful policy and fighting a hopeless rearguard action while failing to aid the wounded.
In the course of the last week I have talked to two very respected commentators, including the deputy editor of a much respected national newspaper. They said to me that they do not expect this Government to last the year. They cannot foretell on what issue or how it will be, but they smell death in the air. If I may close as I began, in an ecclesiastical role, I will say "Amen" to that.
8.38 p.m.
Baroness Seear: My Lords, I suppose it must be agreed that the terms of this debate did encourage a knockabout attack on the Government —I am not of course describing my noble Leader's speech as "knockabout"—and a knockabout response from the Labour Party. That was a very enjoyable and well sustained battle.
Of course it does not really represent the reality of what has been going on and what is affecting us today. The fact of the matter, as everybody knows, is that the decline in this country has gone on for a very long time. It started over a hundred years ago and it has continued, in recent decades at an accelerating rate, under both Conservative and Labour Governments. The speakers from the Labour Front Benches, with justice, have accused the Government of all manner of misdeeds and mistakes but—and I do not wish to dwell on this—we could remind them that inflation did touch 25 per cent. during a Labour Administration, that we had the "winter of discontent" and that we had over decades a declining share of world trade for this country until it got down

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to under 7 per cent. That has been contributed to by both administrations. For good measure I shall add that if we on these Benches had had the opportunity to be the Government I am sure that we would have contributed to the mess the country is now in. There is no monopoly of stupidity and capacity for making mistakes in any political party. That is fair enough. But what really matters is not so much who is to blame or what particular misdeeds have contributed to the state we are in, but what we can now do about it.
During the course of today's debate a number of valuable proposals have been put forward which at any rate in the shorter run would do something to reduce the evils with which we are confronted—and evils they are. I was very glad that my noble friend Lord Beaumont brought out the social aspect of the problems of this country today to which, perhaps, too little attention has been paid, although I think it has been implicit in a good deal of what has been said. While I would not for one moment say that unemployment is a cause of so many social problems —it is not as simple as that—it is difficult not to believe that it has contributed very considerably to truancy, to crime, to a feeling of despair and to the development of groups of people who feel that they do not belong to society and that as society has done precious little for them they do not see why they should do anything for society. One could go on at length about that. But it has been implicit in what has been said, even if it has not been made as explicit as some speakers would have liked.
Some useful proposals have been put forward. Some of them could be implemented quite quickly and would make a modest contribution towards solving the problems that we encounter. The noble Lord, Lord Clark, talked about the importance of sustaining and assisting small businesses. There is general agreement that a reduction in unemployment could come most easily by strengthening and encouraging small businesses, which are capable of taking on a couple of people here and three people there. Spread throughout the country that could make a considerable contribution. The Government no doubt have that in mind. We should be interested to hear if there is anything that they think can be done—and done quickly.
The uniform business rate is an obvious candidate for dealing with the problem of small businesses that are harassed by the level of rates which they have to pay. And surely—we have made this point a number of times in your Lordships' House—it is possible to do something about the late payment of bills. It is quite monstrous that small businesses, sustaining employment and doing a useful job of wealth creation, income creation and work creation, should be handicapped by the deliberate refusal to pay bills on time. Is it really not possible to introduce an automatic interest charge—and perhaps an accelerating interest charge—if the delay goes on? That would speed up the payment of bills. That is a small and simple thing but it could be a considerable help in a number of cases.
Then of course there are the suggestions which have been made many times in your Lordships' House in previous debates and were made again by, among
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others, my noble friend Lord Ezra. Surely we could do something about investment in the construction industry. Surely we could pick on those schemes which have planning permission and on which we could go ahead now. That would create jobs quickly. One of the difficulties of trying to get recovery through the construction industry is that in some respects it takes a long time to move from the decision to encourage the construction industry to actual jobs and pay in people's pockets.
There are schemes which could be quickly put into operation. As we have said so often, the obvious one is to release the money held by local authorities and thereby provide local housing. That would have the double benefit of creating jobs and relieving the housing problem which we all agree is one of the most serious social problems and which has a multiplier effect on social problems. Homelessness in itself creates a whole range of other problems. If one can tackle that, one begins to contribute to tackling some of the other problems that are connected with it. We should help the construction industry and give emphasis to those schemes which are already waiting to get going and can therefore contribute jobs quickly.
We could also do something about the railways. Why this obsession with nationalising rather than getting on with improving them? We should get freight off the roads and onto the rails. That would have so many beneficial effects, instead of which we seem to be pouring money into roads. Wherever one goes in this country one is blocked by those red and white creatures—
Noble Lords: Cones!
Baroness Seear: —which are to be found right across the country. Surely that is not the best use of resources. We want freight off the roads. For green reasons it is always beneficial to get two for the price of one. If one improves the railways one relieves the congestion on the roads and one relieves the pollution caused by cars—and goodness knows how much money one could save. If one calculated on a time basis the man hours lost by sitting doing nothing in cars which cannot move, improvements on the railways would surely be a very good investment. In addition, although for the moment I do not want to dwell on it, more money is needed for education and training.
I want to reiterate the proposal put forward by my noble friend Lord Ezra. He has done the sums. He pointed out quite rightly that none of these things can be done without money. What is required is a two-year levy for investment. With the right leadership I believe that people would respond to that. We believe that our proposal during the election last year, to put a penny on taxation to improve education, was very much approved by the electorate. I have to admit that their enthusiasm for it was not reflected in votes in the ballot box, but as one went round one was told repeatedly that they thought that this was a very good scheme. The Treasury detests the idea of any hypothecated taxation, but the general public would respond very differently to the demand for an investment levy if they knew what it was going to be

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used for. There is a feeling that all the money goes into a bottomless pit or black hole and that no one sees any benefit from it. If they knew that it would be used for real job creation work, which is also work that needs to be done, the response might be very different. Will the Government think again about that?
These are all things which we could and should be getting on with doing. But what has not been mentioned today, although my noble friend Lord Ogmore touched on it, is something which fills me with the deepest apprehension, not least because it is raised so rarely. We are all talking as if a change of government or a change in policy would lead to recovery. I wonder. What this country has not faced up to is that we are now operating in a global economy. There is no going back on that. We have to compete throughout the world—the Asian rim, Japan, America and the Middle East. Supposing China takes off—it is showing all the signs of taking off—what a formidable competitor it will be. We have not begun to think about this, and yet this is where leadership ought to be pointing. We have to prepare ourselves to compete in a global economy. Already the share of world trade of Singapore, Hong Kong and Korea is the same as that of the United Kingdom. Their share is going up. I find that a horrifying figure.
How are we going to compete? This situation is true of all European countries. We talk as though we were competing only in the European Community, but European countries have to compete on this worldwide scale. But our position is worse than that of our fellow members of the European countries. Why? Because we have such a high level of unskilled and untrained people. As regards the unskilled work—except for that which is physically tied to the ground, such as sweeping the floor and so on—a great deal of it is going to the developing countries. It is going to those low-cost countries. British manufacturers and the company I used to work in are now sending many of their component parts to low-cost countries, bringing back those parts for assembly in this country. But the work that used to be done by unskilled people in this country is being done by unskilled people across the globe. That will and must go on.
Why do I say "must"? Because we have to combine with that the other terrifying statistic; namely, the increase in population in the developing and undeveloped countries. To double the population, as is expected, by the year 2300 will not create a pleasant time. I shall not be here, but I believe that the noble Earl, Lord Caithness, might be.
Lord Jenkins of Hillhead: My Lords, he will have grown up by then.
Baroness Seear: My Lords, unless those people can earn a living by trading in this global economy, the problems of migration which we talked about last week will be as nothing compared with the problems which we shall encounter as that population explosion continues. Those other countries will get this work. What will happen to the unskilled people in this country? One can have recovery and the recession
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disappearing and our unskilled people can be left like flotsam on the seashore unless we do something about it.
Surely what is needed is a mammoth attack on the untrained nature of our labour force. I refuse to believe that people in this country of all ages are not capable of learning new things. Many of them do not believe that they can. But if one can train Germans then one can train the English, the Welsh, the Scots and the Northern Irish. Surely it can be done, but it needs an investment of money—I stress the word "investment"—because if we do not invest and get rid of this huge backlog of the unskilled, the social problems that we see today will be as nothing to the social problems in 10 years' time.
8.53 p.m.
Lord Peston: My Lords, I start by agreeing with one of the more acerbic remarks of the noble Lord, Lord Jenkins of Hillhead. He is quite right in saying that we should certainly have won the election. Indeed, I believe that the electorate itself realises that we should have won the election. But when I reflect on why we did not, relevant to today's debate, is the fact that what was central to our defeat is that we were honest about tax increases and so were the Liberal Democrats. We said that expenditure was necessary and that we would raise taxes to finance it.
We were crucified by the Government supporters —perhaps I should say their erstwhile supporters—in the gutter press. I now say to myself: what will the Government say when, before very long, they raise taxes? In the light of the view that democracy is being brought into disrepute, what will the Government say specifically about that charge and their own activities?
I now turn to the speech of the noble Earl, Lord Caithness. What am I to say about it? I have heard it several times before both from him and from other Ministers. I do not blame him for that, but the invention of the personal computer and its associated word processing software. Essentially what happens is that one brings up the file marked "Economic Debate in the House of Lords". It comes up on the screen. One moves the paragraphs around; as we all know how to do a little, so that they are not in precisely the same order. One brings up to date the statistics and then one comes to your Lordships' House and reads the result out again.
There are two aspects of the noble Earl's speech which I was unhappy about. First, echoing his right honourable friend the Prime Minister, he referred to the rise in unemployment as being disappointing. I believe that such a euphemism does not measure up to the moral response required in the light of the social and economic tragedy represented by large-scale and persistent unemployment.
I also wonder whether the Government, represented by the noble Earl, when they praise low interest rates, the devaluation of sterling and high government expenditure, really appreciate what they are saying. Does the noble Earl not comprehend the intellectual betrayal involved? It is a complete repudiation of everything that he and his right honourable and noble friends have been saying for 15 years.

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All the good points have been made and at this late hour—especially given the pangs of hunger—I do not intend to go over all that ground again. I hope that noble Lords will accept my apology. I agree with a great deal of what everyone has said. I am not going to go over those points, saying "I agree with this and that". I desperately look for one or two things which have not been said and come up with the need to remark on the seven wise economists, if that is not a contradiction in terms. They published their report on the economy last week.
Noble Lords will recall that when this group was first announced some time ago, I addressed noble Lords on the subject. I have not changed my view on it. I said then that if HM Treasury is unable to operate with its own economists, of whom it has a great many, it should simply fire them and get some more. It does not need this outside group. Indeed, given their report, I hold to my opinion more strongly than ever before.
What are we to make of a collection of persons whose views on the percentage change in GDP range from 0.2 per cent. to 2 per cent. for 1993 and from 1.4 per cent. to 3.4 per cent. for 1994; and whose views on inflation similarly range from 3.1 per cent. to 4.8 per cent. and from 1 per cent. to 4.9 per cent.? Above all, what is one to make of their views on the current account deficit range from £6 billion to £22 billion? As regards theoretical underpinnings, which are allegedly given by economics itself, other readers of their report may discern them but I cannot. The Chancellor would get better advice from the pools' panel than from this panel of seven economists.
The noble Lord, Lord Marlesford, referred to independence for the Bank of England. I am well aware of the theoretical case in favour. But again, we must look at the reality which in a way he alluded to. When I take note of the people who are appointed to senior places in the Bank, for all its failings in recent times I would still take my chances with the Treasury. That is again reinforced by reading the inflation report in the latest Bank of England Quarterly Bulletin. It is monetarist in the extreme. It would be an insult to the Bourbons if I were to make the usual remark about learning nothing and forgetting nothing.
As regards economic policy, the Government's original view was that all they had to do was to control inflation and everything else would then work itself out correctly. They believed that they could control inflation by controlling the money supply. Those days are not really so long ago when the Government were saying that. The Government then tried a fixed exchange rate system within the ERM. They were driven out of that. The Government now have a policy which is central to what we have to say; and that is the policy of creating large scale, permanent unemployment. The reading of the record of the 1980s and the early 1990s is that unemployment will peak at 3 million plus. That is not the point at issue. When the recession ends unemployment will not fall much below 2.5 million at best. That is the permanent legacy of this government's policies. The Minister said that we should not be churlish about that, but I am afraid that I have to be churlish because the Government have not solved the problem. They have simply produced
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unemployment. If they wish to keep the inflation rate under control, they will have to keep that level of unemployment permanently.
More generally on policy, we have to ask ourselves which combination is likely to be the more effective: monetary ease and fiscal tightness or fiscal ease and monetary tightness? Originally the idea was the ERM and monetary tightness with fiscal ease. If anything, we now seem to have gone the other way, but we run into the problem of the budget deficit, as we are all aware. I agree with those noble Lords and others who have said that now is not the time to raise taxes. It would be foolhardy to do so. Nonetheless, I cannot believe that this scale of deficit can be maintained indefinitely. I simply cannot see how that can be done. Therefore, the question is not whether to tighten but when. Again, I am sad to say that, if there is one thing of which we are certain with this Chancellor, it is the guarantee that he will get the timing wrong whatever else he does.
Similarly, unlike some noble Lords, I do not believe that we can take a light-hearted view of the current account deficit. The noble Lord, Lord Lawson, whom I agree would make a much better Governor of the Bank of England than many others we could think of, rightly said that if we are an advanced industrialised economy and are running sensible economic policies, we can finance a deficit. However, the converse of that is that if one is pursuing stupid policies and the deficit persists there will come a day when one cannot finance that deficit. That is why we have to take the current account problem seriously, and that is why the warnings that have come endlessly from your Lordships about the importance of manufacturing still need to be heeded.
Ministers provide any excuse possible to say that they are not responsible for our economic difficulties. They blame the foreigners. No doubt President Clinton will in due course be subject to their displeasure and become the villain of the piece. They still blame the trade unions. They are unhappy with the banks and the other financial institutions. They certainly blame the last Labour Government. The noble Lord, Lord Skidelsky, in his new role as apologist for the Tory Party even blames the economics profession. Where will he stop? Where will they stop?
The list is endless, but there are two difficulties with the approach via blame. The first is that when there is some recovery—and even I believe that the economy will eventually improve somewhat—having blamed everybody for the trouble, the Government will not logically be able to claim any credit for themselves. The second difficulty is more serious. If the Government are not to blame, then the economic system is. Given all the needs of our economy, which many noble Lords have mentioned, and given all the needs of the world at large and a labour force which is anxious to work and capable of work, if our economy cannot bring the two together—if it cannot get the workers to the jobs that need doing—there is nothing that is more likely to undermine our way of life. It should not be surprising that so many people have lost faith in the way that we live.

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The noble Lord, Lord Jenkins, referred to both the economic and social aspects of these matters. Perhaps I may make one or two brief remarks (rather more philosophical than empirical) on the social consequences of the Government's failed policies. When it is suggested that unemployment causes crime, the response is made—and Ministers make it —that such a proposition is insulting to the unemployed, most of whom do not and would not break the law. But that is surely to miss the point—and here I echo some remarks of the noble Lord, Lord Gilmour. To throw people out of jobs is to create the circumstances in which some of them—but not all—will turn to crime, or their dependants may do so. They may do so out of need, because they have nothing else to do, because of character failings or for many other reasons. The moralists may wish to blame them and to punish them, but what needs to be appreciated is that many of them would not have engaged in criminal activity if they had been in work or, in the case of young people, if their parents had been in work. For some, unemployment is a cause of crime. It is not the only cause, but both common sense and the evidence demonstrate that it is a cause.
On the more general connection between moral values and the economy, I should like to quote my favourite economist, Adam Smith. I should like to draw two remarks to your Lordships' attention. First, in The Wealth of Nations, Adam Smith refers to,
"the mean rapacity, the monopolising spirit of merchants and manufacturers".
In The Theory of Moral Sentiments he issues a guide to us, advising us,
"to feel much for others and little for ourselves … to restrain our selfish and to indulge our benevolent affections".
When large numbers of our people go around blaming everybody else for the moral problems of our society, they might ask what leadership they have been given with respect to correct behaviour.
I near my conclusion by following some of the remarks of the noble Lord, Lord Clark. I strongly agree with much of what he said, especially his remarks on the securities market, to which I hope we shall return on another occasion. However, I was upset when he attacked those who run down the economy of this country. I know that when the last Labour Government were in power he would have been far too fastidious to have run down this country's economy while the rest of us were doing the best that we could, but I must remind him that some of his noble and right honourable friends were doing precisely that.
I have great confidence in the economic, social and moral potential of our country. What stands in the way of realising that potential is this Government. As long as my critical voice can help to shorten the life of the Government, I and my noble friends will continue to speak as we do.
9.8 p.m.
The Parliamentary Under-Secretary of State, Department of Social Security (Lord Henley): My Lords, I am somewhat relieved, after all the criticism of the Government, that we have not at least been held
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responsible for the activities of the cricket team in India over the past few months. No doubt the noble Lord, Lord Jenkins, can refer to that in his wind-up. Perhaps I may add my congratulations to my noble friend Lord Gilmour of Craigmillar on his maiden speech, welcome his uncontroversial maiden speech and say how pleased we are to see him in the House. He is a distinguished former member of the Government and a distinguished former editor of the Spectator. I make that remark purely because it is a magazine for which I still have a certain fondness, despite the fact that only this week it said that making me look like a fool might be a work of supererogation.
Perhaps I may also say to the noble Lord, Lord Jenkins, that he made much, as did others, of opinion polls in terms of estimating the depth of gloom of the public. The noble Lord will remember that it was in fact under a year ago that a lot of people were making much of opinion polls in the run up to the election and the opinion polls were then proved wrong, and I dare say they will be proved wrong again. There is considerable danger in making too much of them.
There have, as always—it is understandable—been many comments and queries and much speculation on the Budget and on likely changes to the tax regime. The noble Lords, Lord Richard and Lord Bruce of Donington, and my noble friends Lord Gilmour and Lord Clark and others have all referred to the Budget and possible changes in taxation. Obviously no noble Lord will expect me to comment in advance of the Budget of my right honourable friend the Chancellor on 16th March. I am sure that he will note all the comments made by noble Lords during the debate.
If I may, I should like, particularly as a Minister in the DSS, to start by concentrating upon the social aspects of the debate. That was something touched upon by many noble Lords, despite what the noble Lord, Lord Beaumont of Whitley, said. For example, I believe it was the fifth count in the indictment of his noble friend Lord Jenkins that we had made inadequate provision for the less well-off and we did not care for the unemployed. The noble Lord, Lord Richard, reminded us—Her Majesty's Government —of our duty to look after those who are less well off.
As I have said on other occasions standing at the Dispatch Box in this House, we spend on social security in this country some £80 billion. As my noble friend Lord Caithness made clear in his opening speech, that amounts to something like £10 a day for every man and woman working in the country to pay for the social security system. That expenditure is up by some 60 per cent. in real terms since 1979. Lest anyone says that all of that is purely recession-led and drawn on by the growth in unemployment, let me make it quite clear that expenditure on such groups as the long-term sick and disabled—no one can argue that they are the result of recession—has virtually tripled since 1979.
There were also claims that the poor were getting poorer and the rich were getting richer. That came in particular from the noble Lord, Lord Grimond, and the noble Earl, Lord Longford.
The Earl of Longford: My Lords, perhaps I may intervene. A former Conservative Cabinet Minister said that very thing. Let us not forget him.
Lord Henley: My Lords, my noble friend Lord Gilmour also referred to it. If I may, I should like to argue that the case is not as simple as all that. The noble Earl will be familiar with the Government's own Households Below Average Income Analysis which was published in July of last year. That showed an overall growth in average disposable income of some 30 per cent. in the period from 1979 to 1988–89. Those gains were not confined to the top half of the income distribution but were widespread. There were far fewer pensioners, for example, in the bottom decile; that is, the bottom 10.
It is true that disposable income after housing costs of the bottom 10 per cent. did show a very small fall. It showed a rise, if one took it, for housing costs. However, that does not show what has happened to a single group of people over the time. What it has done is reflect a change in the composition of that group. First, there are fewer pensioners in that group; secondly, there is the growth during the 1980s of self-employed people reporting, particularly in their first year or two years of being self-employed, negative or very low incomes which would not necessarily reflect their actual living standards. That has confused the picture at the lower end of the income distribution. I should stress that the self-employed form almost a third of the bottom 5 per cent. of incomes.
One must also consider other indicators such as the possession of consumer durables to build up a picture of relative wealth. There has been an increase in the possession of all consumer durables in that bottom 10 per cent. of the population. We now find that some 65 per cent. of the bottom 10 per cent.—up from 40 per cent. —now have central heating. The figure is 68 per cent. for pensioner couples. Some 70 per cent. now have telephones—that is up from 50 per cent.—and some 45 per cent. have cars. To add further confusion to that figure, that group—the bottom decile—spends more than the second decile group.
Lord Eatwell: My Lords, I am somewhat puzzled by the Minister's remarks. Will he help us to gain a picture of the poor getting poorer and the rich getting richer by comparing in change in real income of the lowest decile with the change in real income of the highest decile during the period?
Lord Henley: My Lords, on average and for all deciles we have seen an increase of 30 per cent. I said that if one takes the figures after housing costs there is a slight fall for the bottom decile. If one takes the figure before housing costs there is an increase. There is an argument for taking it one way or another. Obviously there are higher increases for other groups. We are also trying to argue that there is higher expenditure in that lowest decile which seems to indicate that they are not poor. They are, for example, the newly self-employed and those starting off in business who will have expectations of their standard of living far higher than the noble Lord would
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conventionally think of as that of the poor. That does not give a true picture and I hope the noble Lord will accept that.
I wish to turn briefly to the income of pensioners. We have seen the average total net income of pensioners grow during the years from 1979 to 1988 by an average of 3.3 per cent. per year over and above inflation. That compares with some 3 per cent. between 1974 and 1979. In other words, there was greater growth in every year from 1979 to 1988 than in the whole period from 1974 to 1979. Their income from savings increased by more than 8.6 per cent. per year during that period. The noble Baroness, Lady O'Cathain, will be interested to know that their income from savings fell between 1974 and 1979 when inflation was so high. We now have some 57 per cent. of all pensioners and some 69 per cent. of recently retired pensioners receiving income from occupational pensions.
As regards the economy and in particular the funding of pensions for the future in terms of comparisons between ourselves and our European colleagues, the total value of the United Kingdom occupational pension fund is greater than the occupational pension funds in the rest of the European Community put together. I ask noble Lords to think what that figure means in terms of the funding of pensions and the way in which we will pay for them in the future.
The adequacy of benefits was raised by the noble Lords, Lord Richard and Lord Beaumont. I do not accept their arguments that levels of income support are not great enough to pay for an adequate diet. Obviously it is difficult for some people to manage on the levels of income support. We have never claimed that a life of luxury is available on the levels of income support—but it is perfectly possible to live. One must also remember that income support is funded by general taxation paid by taxpayers, many of whom are on relatively low incomes. Nor do we want the levels of income support to act as an attractive alternative to seeking work or training.
The noble Lords, Lord, Richard and Lord Callaghan, referred to some advice given by MAFF on nutrition. I am not familiar with any MAFF publication which fits the description given by the noble Lord, Lord Richard, and I should be interested to see it. If the noble Lord will make it available to me I shall look at it. I am aware of advice from MAFF indicating that its national food survey shows that the diets of people in all income groups contain adequate levels of most nutrients but rather more fat and less fibre than the latest dietary recommendations—
Lord Richard: My Lords, I was referring to a specific table produced by MAFF on how to live on £10 a week nutritiously. I shall ensure that the Minister receives a copy if he does not have one.
Lord Henley: My Lords, I am grateful. I can send the noble Lord copies of facts and figures from the Department of Social Security which will give the levels of benefit for all the different age groups. He will see that there is available for food considerably more

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than £10, although we do not divide up levels of income support for specific purposes. However, levels of income support are considerably greater than that.
The noble Lord, Lord Beaumont, objected to the use of loans in the social fund. Again, I simply cannot agree with him. Its predecessor, the single payment, was rocketing out of control in terms of cost in a way that no government could tolerate. Furthermore, the single payments were scattered across the country in an odd manner, which implied unbalanced take up. We believe that loans allow more money to go to more people and it is only fair that those on low incomes who are not eligible for help from the social fund should not be disadvantaged as compared with those who are on income support and therefore eligible for loans.
The noble Lord, Lord Richard, claimed that it was unfortunate—I believe that the word he used was stronger —that some 25 per cent. of children live in families on income support. I am afraid that that quite simply reflects the fact that there are on income support a larger number of lone parents with children; there are some 900,000. That is the result of social changes. I believe that even the noble Lord, Lord Richard, would accept that the number of single parents can hardly be said to be a result of government policies.
I turn now to the question of unemployment and our unemployment strategy. I do not accept the allegations of whole-scale indifference which the noble Lord, Lord Jenkins, seemed to imply. We accept that the figure of 3 million unemployed is deeply worrying. Similarly, the fact that the latest figure for the long-term unemployed has risen to 1 million is also deeply worrying. We accept that the threat of unemployment is holding some people back; but the Government cannot create jobs. Industry and commerce do so through improved competitiveness and by producing the products and services which customers want.
What the Government can do and what is our top priority is to help unemployed people find jobs. The Government are determined to do all they can to ensure that every individual receives the help needed to get back into work as quickly as possible. New measures for 1993–94 will mean almost 1.5 million places on employment and training programmes, an increase of almost 500,000 this year. There is also the normal job placement help offered to all unemployed people by the employment service. My own department also makes available family credit which now helps some 450,000 families get back into work. All that amounts to a comprehensive range of help and advice available to unemployed people.
I should also like to make one brief comment on international comparisons as regards those in employment. If one ignores Luxembourg and Denmark, we have the highest proportion of our working age in employment—some 71 per cent., which is far higher than most of our competitors and much higher than the EC average. Putting comparisons with the 1930s into perspective, one should consider that unemployment is now around 10 per
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cent. at 3 million. In the 1930s when the unemployment figure reached 3 million that accounted for some 20 per cent. to 25 per cent. of the population. That is a much higher figure and a larger percentage of the workforce out of work.
The noble Lord, Lord Callaghan, talked about the despair among the unemployed that they would never find their way back into employment. In any one day there are some 300,000 vacancies available in the economy. About one-quarter of those who become unemployed leave unemployment within one month; about one-half leave unemployment within three months; and two-thirds leave it within six months. However, I accept what the noble Lord, Lord Callaghan, said about the fact that the figure of 1 million unemployed is somewhat worrying.
My noble friend Lord Skidelsky referred to workfare. We are considering a range of ideas for keeping the unemployed in touch with the world of work. In the year from April the employment service will provide help through 1.5 million opportunities for unemployed people. However, we are not considering workfare as the term is often understood by the media. There are no plans for a single scheme to cover all unemployed people. We aim to provide training and work experience to meet the needs of individuals and the labour market. Since many people are able to get back to work soon after becoming unemployed, it is right to target help on the long-term unemployed.
I should like to say a few words on the subject of crime. We have taken committed and sustained action against crime for more than a decade. Spending on the police—and I believe that this was welcomed by the noble Lord, Lord Jenkins—has increased by 81 per cent. in real terms since 1979. There are now 16,700 more officers and 14,700 more civilian staff. Accepting that there is a particular problem as regards young offenders, we are looking urgently at the possibility of new powers to deal with that small minority of persistent young offenders.
Recorded crime has shown a steady underlying upward trend over the past 40 years. Since 1970 there has been an average annual increase of 5 per cent. There are many possible explanations, not least that increasing affluence has increased the opportunities for crime. Low incomes or unemployment, despite what the noble Lords, Lord Richard and Lord Peston, said, do not cause crime. There are no excuses for lawlessness and hooliganism. It would be Wholly wrong to suggest that people on low incomes are bound to be criminals. There is no single cause of crime.
Lord Peston: My Lords, I am sorry to interrupt the noble Lord but he simply does not understand what I am saying. I am certain that his advisers understand what I am saying. One can perfectly correctly say that unemployment is a cause of crime without saying it is an excuse for crime. The two things are logically different. The noble Lord ought to understand that point. I am not excusing crime, but explaining it when I talk about unemployment.
Lord Henley: My Lords, I was saying there was no single cause of crime.
Lord Peston: So am I!
Lord Henley: My Lords, I am glad the noble Lord has confirmed that. I was trying to argue that unemployment should not be used as an excuse for crime. Crime is committed by individual criminals. That is the only cause of crime. As the noble Lord will know, many people who have problems and disadvantages do not offend. Similarly, I think the noble Lord will recognise from articles he may read in the press from time to time that there are many who have distinct advantages who still go on to commit crimes and turn to crime.
I had not intended to say much about the National Health Service or health generally but I want to reiterate one particular point which the noble Baroness, Lady O'Cathain, made when she cited some particular statistics that bear repeating. As the noble Baroness said, life expectancy between 1979 and 1989–90 has increased from 70.2 to 73 for men and from 76.4 to 78.5 for women. I think that seems to show that the rather shock horror cries from the Jeremiah's that we are all dying and we are all in the most appalling state are not really true. The health of the nation is steadily improving and that is something of which we should be proud.
Lord Eatwell: My Lords, does the noble Lord agree that life expectancy actually fell in 1987 and 1988 and that is the only time, in the lifetime of any Western European government, that life expectancy has fallen, even on a year-on-year basis?
Lord Henley: My Lords, I shall have to write to the noble Lord. I do not actually have the figures for those two years. But if one looks at the matter as a whole from 1979 to 1988–89—I think I mentioned the figures up to 1990—there is a pretty dramatic increase in life expectancy in a matter of 11 years. It increased by three years for men and 2 point something years for women. That is a very large increase over a short period.
I have already outlined the considerable resources being devoted to the alleviation of social problems. As my noble friend Lord Caithness stressed earlier, economic progress, in combination with a continued determination to improve efficiency in the provision of social assistance, is the key to improving further the help we provide to the most needy in society. I also believe that he was right to stress the real supply side improvements that occurred during the 1980s and which will re-emerge once the economy begins to recover.
The Government continue to believe that the only way to generate sustainable growth is to achieve low inflation on a lasting basis. That is why the progress that has been made in reducing inflationary pressures is so important. We now have the lowest retail price inflation for 25 years and the lowest rate of earnings growth for a similar period. Manufacturing unit wage costs were unchanged in the final quarter of 1992 from a year earlier—a better performance than from either Germany or Japan. Producer price inflation in recent months has been the lowest since the late '60s.
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Taken together these figures demonstrate the very real progress we have made against inflation. This progress offers the prospects of strong and sustainable growth in the years ahead, and the Government will not throw away this prospect by adopting policies that allow inflation to rise once more. We have put in place an explicit inflation target for the first time and introduced greater openness into the process of evaluating the extent of inflationary pressure in the economy. I believe that these steps will help us to ensure that our achievement in getting inflation down will be a lasting one.
Obviously, there has been a great deal of concern about when economic recovery will begin and this has been reflected in today's debate. The recession has proved to be a good deal more prolonged than the Government expected. Output during 1992 fell only slightly but clearly the return to growth we all hoped for did not take place. I am aware that the further small fall in output was associated with a substantial further rise in unemployment. I and other Ministers realise that that has caused very real hardship to many families and the Government have taken positive action to encourage a resumption of growth.
Following our departure from the ERM the Chancellor was able to reduce interest rates substantially. That was followed by an Autumn Statement containing many measures aimed at helping those sectors most affected by the recession. I believe that those measures have played an important role in bringing about the improvement in business and consumer confidence we have seen since the autumn.
As my noble friend Lord Caithness pointed out, the other ingredients for recovery are now in place: the lowest interest rates for 15 years, the lowest inflation for 25 years; and a lower pound, combined with the best unit wage cost performance we have achieved for several years. Those are the reasons why noble Lords on all sides of the House should believe that, despite earlier false dawns, prospects for recovery are now good. As my noble friend Lord Clark of Kempston said, it can only do us harm when, as he put it, influential people run down their country and its economy. I believe that the policies of this Government have ensured that the prospects for that growth to be sustained in the years ahead are also good.
9.30 p.m.
Lord Jenkins of Hillhead: My Lords, I do not intend to detain the House long at this time of night. We have had a long and worthwhile debate and I thank all noble Lords who have taken part, particularly the two Ministers who participated in our debate. I deliberately said that they had participated in rather than replied to our debate because the latter would be a slight exaggeration. This afternoon, the noble Earl, Lord Caithness, proclaimed such universal truths that he did not feel it necessary to engage with the speech to which he was replying. Tonight the noble Lord, Lord Henley, produced at one stage a positive

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blizzard of confusing statistics which possibly, when read tomorrow morning, may leave some deposits in the mind.
I thank the noble Lord, Lord Henley, for the compliment which he unwittingly paid me by constantly saying that we were in the best position for 25 years. If he casts his mind back to where 25 years takes us he will realise why I treat that as a compliment.
The noble Lord, Lord Skidelsky, in the course of a spirited reply, said that the figures for those wishing to emigrate were the worst since 1969. I fear that that was a figment of his imagination. According to the Daily Telegraph, a newspaper not altogether unfriendly to the Government and which made much more of the Gallup poll than I made of it in my speech, the poll shows that the number of people wanting to emigrate in 1969—the year chosen by the noble Lord, Lord Skidelsky—was one of the lowest since the war, although it was beginning to rise at that stage.
There is only one other factual point raised on the other side of the House which I should like to take up. The noble Lord, Lord Marlesford, contested on historical grounds my view that the death knell of unemployment defeating governments had been sounded. He said that unemployment had never meant anything of the sort. I contest that. Unemployment did not become a major political issue until after the First World War. I certainly take the view that it was a major factor in the defeat of the Baldwin Government in 1929 and that it effectively destroyed the Labour Government in 1931. The noble Lord is wrong in saying that unemployment then rose between 1931 and 1935. It rose for one year and then fell for three years. The Labour Party gained 100 seats as a result, but not enough. Subsequently, in general elections from 1940 through to the 1970s unemployment ceased to be an issue because there was no serious unemployment. Unemployment may have been a factor adverse to the Labour Party in 1979. Certainly the Conservative Party produced a poster which showed a long dole queue and the slogan, "Labour is not working". By 1983 we had entered the period in which, under my thesis, parties could win elections despite mass unemployment, and that was bad for national cohesion.
Today one or two hard responses were made to my speech, and I make no complaint whatever because I made a few hard points myself. While I threw 10 stones across the Floor of the House for every one which I rolled gently towards my friends above the gangway, I believe that the sensitivity in response has come more from the Labour Benches.
The noble Lord, Lord Callaghan, and I have had a discussion and we have reconciled both our senses of honour and of memory about 1976. I shall not trouble the House with that. The noble Earl, Lord Longford, implied that my changes of nominal party were the equivalent of his sudden move across the political spectrum which I had always considered had something to do with his being knocked unconscious at a political meeting. I am glad to hear that he denies it; it was nothing to do with that. However, his was a
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complete switch across the political spectrum, whereas, although I may have belonged nominally to three parties, it is my firm view that I have remained exactly where I am and that other people have changed. I have held exactly the same moderately social democratic views for at least the past 25 years. It was the Labour Party which, by the end of the 1970s and in the 1980s, was inviting me, if I wished to stand as a candidate, to be in favour of coming out of Europe without a referendum, destroying NATO, having unilateral disarmament, running before the trade unions, having a massive programme of further unwanted nationalisation and forbidding by law private health care or private education. That was a programme which I believed that any decent Social Democrat could only stand behind wearing dark spectacles and with his dirty mackintosh collar turned up. On the whole I did not propose to do that.
With regard to the move from being a Social Democrat to a Liberal Democrat, that was no greater a change than one river flowing into another. The Social Democrats were a most important tributary of the new party. It was no more of a zig-zag than the move which the River Missouri performs by flowing into the River Mississippi.
I conclude by referring to one point raised by the noble Lord, Lord Ewing. He stated that I surely could not take the view that the Opposition bore any responsibility for the fact that the Government could get away with almost anything without resigning. Frankly, I do. I believe that it is part of our parliamentary process that governments should be slightly frightened of opposition. If the Opposition —I refer to the Opposition in another place—cannot intimidate the collection of nature's junior Ministers who constitute the present Cabinet, then I believe that it is a criticism of the effectiveness of the Opposition. However, let me assure the noble Lord and everyone else that I wish the Opposition well and I am sure that it will be even more effective in the future than it has been in the past. I beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave, withdrawn.

Royal Naval Depot: Jobs Transfer
9.38 p.m.
Lord Gisborough Lord Gisborough rose to ask Her Majesty's Government whether they will reconsider their decision to transfer 182 jobs at the Royal Naval Depot from Eaglescliffe to Bath.
The noble Lord said: My Lords, as part of Options for Change the Armed Forces Minister took a decision in December to relocate 182 civilian jobs in the Ministry of Defence establishment at Eaglescliffe to Bath. As most of the people who held the jobs in Eaglescliffe will not have the opportunity to transfer, there will be a total loss of 180 jobs, 120 civil servants becoming redundant, and only 30 moving with their work.
There is no alternative Ministry of Defence workplace in the area and the prospects for re-employment in the Cleveland area are bleak. The

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social consequences of unemployment and the effects on individuals are well known. But they are particularly difficult to accept when the people concerned have been loyal, dedicated to government service and responsive to the supply line needs of our Armed Forces overseas during recent conflicts.
Cleveland has suffered job losses in heavy manufacturing industry over the past two decades. It has a long record of persistent levels of unemployment which is among the worst in the country. It desperately needs to diversify into white collar areas of employment such as the Civil Service, where the 180 jobs are to be lost.
Unemployment in the county currently stands at 37,000, or 16.7 per cent., compared with 9.8 per cent. in Bath, which is below the national average of 12.1 per cent. There are 47 people for every vacancy in Cleveland, but in Bath there are less than half that number. In the national discussions on the implications of Options for Change, there is an assumption that the worst effects will be felt in the South and the South West, where there are concentrations of defence-related employment. Yet it is the northern region which has the highest rate of unemployment in the country. Thus, while the Department of Trade designates the area for the highest level of assistance under regional policy and the Department of the Environment promotes the highly successful Teesside Development Corporation, the Ministry of Defence is actually removing jobs to Bath—a place with no assisted status and relatively low unemployment.
The recent record of the Ministry of Defence in the Cleveland area does not inspire confidence. In January, after three years of uncertainty, it finally announced the cancellation of the relocation of the Quality Assurance Directorate from Woolwich to Stockton. That is a loss of 1,600 jobs and through the knock-on effect many hundreds more. Plans for the site, which included security facilities and specially designed access provision, had to be discarded and public expenditure amounting to several million pounds was wasted.
On the assumption that the MoD development was taking place, it was decided to divert elsewhere a potential relocation of 2,200 Inland Revenue jobs. It was in April 1992 that the MoD published its proposals to unify Naval Support Command in Bath, relocating jobs from London, the south coast and the Supplies Directorate in Eaglescliffe in a multidisciplinary working group. Those jobs had their origin in Eaglescliffe in 1947.
The background to the proposals for the Naval Support Command lies both in the Options for Change strategy and the financial management initiative for the Civil Service. That seeks greater financial accountability and departmental identity for civil servants, known in the MoD as the new management strategy. The principles underlying the proposals are not in question. But the key proposals for the support command are that all staff should be co-located in a new, expensive building near Bath.
The personnel in Eaglescliffe are already housed in first-class secure office accommodation that will be left
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empty if the jobs move. Operational savings through a multi-disciplinary group working within the Naval Support Command can be achieved without moving, particularly in these days of modern information technology. Not surprisingly, the proposals for job losses in that high unemployment area have produced considerable local opposition. Elected members and trade union officials met the Armed Forces Minister in May to request full consultation and consideration. All the proper channels have been used to express the strength of local feeling about the proposals, and the campaign has received whole-hearted support from representatives of all political parties.
The Minister received a deputation and letters in support of the response to the consultative document of September 1992 from a wide range of MPs. Yet in December he announced that the relocation would proceed. The MoD consultation document was restricted in its financial appraisal to consideration of the business objectives of the department. The Cleveland response to it made out a strong case that satisfactory costings to justify the argument to relocate to Bath had not been presented, even in a narrow business sense. But the response went beyond that and examined the wider implications of the proposals for public expenditure. The savings predicted by the MoD amounting to £12 million over 10 years are reversed. The Cleveland response suggests a cost to the Exchequer of £10 million over 10 years as a result of the move.
One of the key reasons for the turnabout is inaccuracies in the costings in the consultation document. Cleveland is already familiar with inaccuracies in MoD costings. That was one of the main stumbling blocks to achieving the relocation of the Quality Assurance Directorate before its eventual cancellation. Another reason for the turnaround in the costings is the inclusion of estimates relating to the costs of the unemployment that will be created, including income tax forgone. In announcing his decision, the Minister made clear that neither the wider implications for public funds nor the effect on the area had been taken into consideration. If the Minister was advised that he would exceed his responsibilities if he considered those wider issues, the proposals should have been referred to a more senior level for final arbitration in view of the serious local concern.
At the moment there is an impression among local representatives that the MoD approached consultation in a perfunctory manner. The time taken to consider local response was very short, no questions were addressed back to the authors and the comments issued with the Minister's announcement demonstrate that inadequate attention has been given to the detail of the document.
The 180 jobs are due to move in 1995 or 1996, after the formation of the Royal Naval Support Command, until which time posts will become vacant through natural wastage and redundancies. The core of expertise built up over the years will be lost. Only 30 people will move to Bath, the rest being recruited locally. But the planning has only just started. Even the ultimate location is not known. Outline planning

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is sought for two sites and a decision is expected in the summer. Clearly there is ample time for a change of heart. Many changes are being mooted by the Department of Trade, the Department of the Environment and the MoD. Co-operation between them is essential, particularly in times of public expenditure restraint. The Treasury has a responsibility to ensure that such co-ordination takes place, but evidence from the Eaglescliffe decision suggests that it might be improved.
If the Minister's decision to relocate is irrevocable —I hope it is not—perhaps he will bear in mind that in Eaglescliffe there will be a first rate office block, vacant and on a secure site, with ample room for expansion and excellent transport links, which would be suitable for another MoD or Civil Service establishment. There have been recent reports that there may be interest in relocating there employment within the responsibility of the Department of Education.
Cleveland is a priority area for government policy to tackle urban regeneration. It has benefited from the Teesside Development Corporation, the urban programmes, task forces, the Cleveland Action Team and Middlesbrough City Challenge. There have also been successes under the Civil Service relocation scheme and, for example, jobs within the Inland Revenue have moved to Middlesbrough. All those steps have proved the commitment of the Government. But the loss of the MoD jobs begs the question of whether narrow departmental interests now take precedence over priorities of regional policy.
It is not too late for the decision to be reconsidered at a more senior level where wider issues can be taken into account and unnecessary costs to the Exchequer avoided. The consultation paper can be taken more seriously, the local arguments more carefully examined and the effect on the local area considered. In the light of the important issues for several other departments, I believe that the matter should be raised at Cabinet level so that it might be possible to achieve clarity in Civil Service relocation and in the conflicting priorities of regional policy and urban regeneration compared with narrow departmental considerations.
Let there be no doubt that confidence has been shaken by the decision to move those jobs to Bath and create redundancies for people who have little chance of re-employment and will therefore suffer disruption of their family life. By reviewing their decision, as they did recently for the Army, the Government will give a concrete demonstration of their continuing commitment to Cleveland and help restore confidence.
9.49 p.m.
Lord Crathorne: My Lords, I rise to support my noble friend Lord Gisborough. I hope that the Government will reconsider their decision on this matter. Like my noble friend I live close to Eaglescliffe. We both feel a very personal concern in this matter.
It is an appropriate moment to discuss this Question. Figures for those suffering long-term unemployment of more than a year have just been
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released. They show nationally the worst position for five years. The plans to move jobs from the Cleveland area to Bath and make approximately 120 local people redundant will add to those figures. And through increased competition in the local labour market, their chances of finding work will be much reduced. The consequences of unemployment are borne by individuals, by families, by communities and by society as a whole. The lack of confidence, the poor sense of purpose, poverty and social problems are the seed-bed for a small minority to indulge in anti-social and unproductive behaviour that affects us all, particularly in urban areas where such behaviour is on the increase. One has only to look at today's papers to see that.
The plans to move jobs from Eaglescliffe to Bath are not an isolated example of decisions taken by the MoD that adversely affect the northern part of England, as almost 2,500 jobs will go from York, Harrogate and Eaglescliffe together. The planned investment of 120 million over five years at Catterick by the Army is of course very welcome, but this will create no new civilian jobs. The move to Bath will involve public expenditure on new accommodation in that area, while first-class secure offices exist at Eaglescliffe.
Other government departments are spending public money to try to bring jobs to Cleveland which, as my noble friend has emphasised, is an area of very high unemployment. The cost of unemployment to the Exchequer was illustrated recently by the release of figures by the Treasury showing the growth in the numbers of civil servants. In the employment service an extra 9,000 staff were required in the last two years to pay benefits, counsel the unemployed and run schemes for the long-term unemployed—that is an increase of 27 per cent. The Ministry of Defence has stated that costs of this type and local implications have not been taken into account in arriving at the decision on Eaglescliffe. This seems to me to be a misguided policy, when the Ministry of Defence has not really looked at the picture as a whole.
The Ministry of Defence has a good record in reducing the numbers of civil servants, and this is no doubt reflected in public expenditure savings. These current plans, however, threaten to be wasteful when public spending by all government departments is viewed as a whole. There is a clear case for the Treasury's recently announced public expenditure review to include identification of the scope for savings through better policy co-ordination and means of putting those policies into effect.
The Government's general election manifesto promised to strengthen the machinery for co-ordination in the English regions and reflected a need to look at cross-department issues. The importance of looking at these issues is becoming more evident through, for example, City Challenge. In this context, the Association of Metropolitan Authorities has recently suggested a new Cabinet committee to resolve differences between ministerial policy, regional and local needs. I believe this is an idea that should be carefully looked at.

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It is not too late for a change of heart on the Eaglescliffe issue, but if the jobs do go to Bath there must be opportunities for the use of the accommodation by some of the civil servants whose numbers are now increasing once more. There must be only a limited number of first-class offices offering security with excellent transport linkages; and because of the security implications, the accommodation does not lend itself to disposal to the private sector. I feel that the best solution and one that would actually save public expenditure would be a change of heart by the Ministry of Defence. I look forward to hearing what my noble friend on the Front Bench will have to say, and of course I very much hope that he will agree to look at this matter again.
9.54 p.m.
Lord Graham of Edmonton: My Lords, we have heard very reasonable speeches by two Members of your Lordships' House who clearly are close to the action. They are certainly closer than I am, although I must profess that when it fell to my lot to speak on the matter it looked a very timely issue in the context of the MoD and of the national economy. As a Member for many years of another place and having raised in adjournment debates there matters vital to my constituents, I can easily see that the two noble Lords are acting in the same way. They are speaking on behalf of their "constituents", although they do not actually represent them in that sense. However, they are speaking of people they know and love and they are here as part of a campaign. I applaud the energy and the initiative of the campaign fought through the columns of the Northern Echo for many weeks, through the Stockton council and through the civil servants. My very good friend Frank Cook and Tim Devlin, parliamentarians in another place, have also been involved. Now the campaign has been brought here. Both noble Lords conclude in a reasonable state.
I have looked at the project. We all understand, as did the noble Lord, Lord Gisborough, the totality of Options for Change and the fact that the Government have difficult decisions to make. I like to feel that the Minister will not merely repeat what has been said before because since then the position has become worse for the people in the area. There is greater unemployment and greater depression among those people. I say, having been a council leader and a Member of Parliament, that at the end of the day we have to be realists. If the solution the Minister brings is that there is a grand plan of which this forms a part —for the life of me, I cannot understand why it should —the next best thing is that which has been canvassed so far.
Can the Minister say what direct consultations have taken place with the people affected about what will happen to them when they lose their jobs? I congratulate the Northern Echo. I have an extract from that newspaper which says that 30 people are likely to find jobs. The timescale is such that it will not happen next week. We know that in a year's time more people will be unemployed in this area. That is what the Government are telling us. They are not putting
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figures on it but more people will be unemployed. They expect it. What are those people being told about their job prospects?
I come from Tyneside. I was born on the Scotswood Road many years ago. I am not unfamiliar with the closure of pits, shipyards and factories. We understand that these things do happen. What steps have the Government taken to provide jobs? I hope the Minister will not say that there are schemes and plans. What promises have been given to the people who are going to lose their jobs as a result of government action? Are there comparable jobs available for them to look at?
I have looked at the financial aspect of the marvellous building that will be vacated and the lack of a use for it. I am sure that the leader of Stockton council, Bob Gibson, would be less strident in his condemnation of the plan if there was a promise that that building would be used, that other work would be provided and that the people who lose their jobs would be retrained or dealt with fairly and adequately.
I know that the Minister has a difficult task and I do not want to add to it. What I hope he will understand is that the people I have mentioned—the leader of the civil servants, my colleagues in another place and the noble Lords who have spoken today —are neither fools nor knaves. They are doing an honest job representing the people they live among.
Reference was made by the noble Lord, Lord Gisborough, to the Teesside Urban Development Corporation. On my side of the House we have a very good friend, the noble Lord, Lord Dormand of Easington, who, I am sure, given the opportunity, might have been here this evening to say a word or two. I have not discussed this matter with him—I have not had the time—but I am absolutely certain that his Teesside Urban Development Corporation will be anxious at all times to be helpful. I believe that tribute was paid to it by the noble Lord, Lord Gisborough.
I hope that the Minister will be able to tell us that there is some space and room. If the Minister tells the noble Lord that the door is closed, that will be very sad and will cause bitterness. There is time and opportunity for the Minister to say something helpful. Those involved have given their time. They want to be constructive. Politics per se do not enter into the matter at this stage. Political arguments are not involved. We are talking about the fear and concern of ordinary people whose lives can be blighted either if they have to move, or alternatively, if they lose their jobs. I know that the Minister will do his best and I look forward very much to hearing what he has to say.
10 p.m.
Viscount St Davids: My Lords, I must begin by thanking my noble friend Lord Gisborough for introducing this most useful debate. Your Lordships will, like me, have been impressed by the concern that he has shown for those in his local community; a concern which is perfectly understandable and proper in view of my noble friend's tenure of the office of Her Majesty's Lord Lieutenant for Cleveland.
Before I address the specific subject of the noble Lord's Question, that of jobs at the Royal Navy store

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depot at Eaglescliffe, it might be helpful if I were to assist your Lordships by putting it in the context of the wider restructuring of the Armed Forces.
The Options for Change exercise was designed to create smaller forces, but forces which are more mobile, more flexible and better equipped. The Government are determined that at least proportionate reductions should be achieved in the support area as those being made in the front line. That aim was extended to cover the headquarters of the Ministry of Defence, and was conducted by means of the so-called PROSPECT study—PROSPECT being an acronym for the Post-options Restructuring of Support Project.
The aim of the PROSPECT study was to seek to define the roles and functions which will be appropriate to the United Kingdom's defence Ministry and headquarters in the context of recent defence policy developments emerging from Options for Change and to establish the minimum structure to support them.
In 1991 the Government accepted the recommendations of the PROSPECT study. Central to the study's recommendations were the conclusions that only a small core headquarters should be retained in London, with the remaining functions being redeployed, and that headquarters' manpower savings at all levels of at least 20 per cent. should be found.
It is the Government's firm belief that the reductions in the front line must be matched by savings in support to the Armed Forces. If we failed to do that, we would face the need for even further reductions in the front line to pay for the cost of maintaining expensive excess support facilities. I am sure that your Lordships will agree with me that that would not be a sensible or an acceptable alternative. The PROSPECT exercise, and other measures adopted by the Government, carry forward the policy of making the reductions in the support area proportional to those in the front line. They are an essential part of ensuring the best use of our defence resources and providing a structure appropriate to the needs of our Armed Forces in the 1990s and beyond. That is the broad background, and I will now seek to address my noble friend's primary concern.
As part of the restructuring of the Ministry of Defence brought about by the PROSPECT study, the Government agreed to the relocation of the three single-service personnel and logistics functions out of London and merging, where appropriate, with their relevant support commands. Included in all this was the proposal to concentrate the fleet support functions of the Royal Navy in a new Naval Support Command, under the Chief of Fleet Support and with its headquarters based in the Bath area, where over 70 per cent. of the workforce of the new command is already based.
The intention of this move is to bring together those in-service support functions relating to ships, weapons and equipments which are currently dispersed, both organisationally and geographically, in order to improve the service to the Fleet and make best use of reduced manpower resources. This bringing together
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will involve the amalgamation in one command of functions currently undertaken by the Chief of Fleet Support, by the Sea Systems Controllerate of the Procurement Executive; by the Commander-in-Chief Fleet and by the Commander-in-Chief Naval Home Command at the naval bases, and will involve a collocation of headquarters' staff who currently work in London, Bath, Corsham, Portsmouth, Weymouth and Eaglescliffe.
This collocation of staff will be concentrated in the headquarters of the Naval Support Command in a structure of multi-disciplinary groups containing all the necessary support skills such as engineering, materials, management, contracts and finance. Such groups have already successfully improved the efficiency and effectiveness of the MoD's Procurement Executive. Their creation, and their concentration within the Naval Support Command's unified and collocated headquarters, will be critical in achieving the streamlined, taut and responsible Command which is envisaged, and in providing an improved service to the Fleet from reduced resources.
I mentioned that one location where headquarters staff of the new Command are currently working is at Eaglescliffe in Cleveland. Here, Branch 42 of the Royal Navy's supply and transport service handles the commodity management functions for the many smaller marine equipments, sub-assemblies and components, totalling some 350,000 in all, which are familiarly known as MES, or marine engineering spares. The staff of Branch 42 carry out the tasks of inventory and stock management through reprovisioning, basic technician support, contract acquisition and finance.
The opportunity provided by the creation of the Naval Support Command and the formation of a unified, collocated headquarters will produce a number of benefits, which the Government believe will only be achieved satisfactorily by the introduction of multi-disciplinary group structures. The transfer from Eaglescliffe to the new Naval Support Command of the Branch 42 headquarters posts, totalling 182 in all, will provide the expertise in the commodity management of marine engineering spares which the new multi-disciplinary groups will need.
As part of the preliminary planning work undertaken to prepare for the creation of the Naval Support Command, Ministry of Defence officials carried out last year a detailed financial appraisal of the proposal to transfer Branch 42 from Eaglescliffe to the new headquarters in the Bath area. This appraisal also included studies of two alternative options, one of maintaining the status quo, and leaving Branch 42 at Eaglescliffe, and the other of moving more posts to Eaglescliffe so as to form a dispersed outpost of the Naval Support Command headquarters. The result of the financial appraisal was conclusive. In cost terms, the status quo, or do nothing option, would have denied the Ministry of Defence discounted net benefits of some fl 2 million over 10 years, allowing for potential redundancy costs. The dispersed outpost option would have involved the same operational disadvantages as the status quo, associated with trying

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to operate the Naval Support Command on two sites, and would have produced benefits of only about £7 million.
Based on the results of the departmental study, it was decided to begin consultation on the basis that the relocation of the Branch 42 posts from Eaglescliffe should go ahead. A consultative document, which sought to argue the case for the relocation, and which included full details of the department's financial costings, was issued on 8th September last year, and a 10-week period of consultation followed, giving all those with an interest adequate time to consider and respond to the Government's proposal. I am very glad to say that a considerable number of constructive and useful representations were received by way of response to the consultative document from a number of your Lordships, including my noble friend Lord Gisborough, from Members of Parliament, from representatives of local commercial, industrial and training interests, and a formal response produced jointly by the trades unions and the local authorities most closely affected by the proposal.
All the comments and representations made in response to the consultative document were considered very carefully indeed. Other government departments were consulted at ministerial level. Many of those representations sought to widen the debate by addressing broader issues, such as regional development, the undoubted social implications of unemployment and public expenditure issues. However, none of them overturned or affected to any real extent the Government's conclusion that the proposed relocation of 182 posts from Eaglescliffe to the new headquarters of the Naval Support Command to be established in the Bath area offered by far the best cost and operational benefits. Based upon that clear assessment, the Government announced on 10th December last year that the move of the posts in question would begin in 1995–96 and that discussions will take place between management and trade unions on the details of implementation.
I am very well aware of the disappointment which that decision will have caused, not just to the staff involved and their families but also to those involved in and responsible for the local economy and the community. There will inevitably be disruption for some. While we might all agree on the need for smaller Armed Forces and the streamlining of their support, I recognise clearly that those aims cannot be achieved without disruption and possible redundancy for some and temporary damage to the local economy.
Your Lordships will, I hope, be reassured to hear that everything possible will be done to minimise any adverse effects upon the staff concerned. Employees in those grades with a mobility obligation will, where appropriate, be transferred at public expense, and transfers to other government departments or to other MoD establishments will be considered, especially for staff in grades with no mobility obligation. I can assure my noble friend that discussions will take place with other government departments on the possible use of the accommodation being made available when the posts are transferred.
Lord Graham of Edmonton: My Lords, I am grateful to the noble Viscount and appreciate the fullness of his reply. But will he say something about trying to match the jobs lost in the area with facilities which will provide replacement jobs? If local people are left with a generalisation that will not be good enough. Even if the noble Viscount cannot give us the answer now, will he say that there should be some direct consultation on how the jobs lost in the locality —not MoD jobs—will be replaced by a comparable number of jobs?
Viscount St. Davids: My Lords, I cannot answer the noble Lord's question tonight. I shall see whether some means can be found of giving him the information that he seeks.
The Ministry of Defence will establish close contact with other local employers, and any staff leaving prematurely under voluntary or compulsory redundancy terms will be able to use the services of the Ministry's outplacement counselling service which will be available to help identify new opportunities. Such staff would also get compensation under the terms of the appropriate pension scheme. I can also confirm that those moves will affect only the staff of Branch 42. The Royal Navy Stores Depot itself will not be affected and will continue to provide a considerable number of employment opportunities at Eaglescliffe.
We owe a debt of gratitude to my noble friend Lord Gisborough for representing so eloquently the interests of the community in the Cleveland area, and especially of the workforce at Eaglescliffe, some of whom will regrettably be affected by the Ministry of Defence's action that I have explained. The end of the Cold War, which your Lordships and, indeed, the whole country will have welcomed, means that we can reduce the share of our national resources devoted to defence. That is an example of the so-called peace dividend. But that dividend has a price which is that the Government have to look very carefully indeed at the support facilities available for defence and to reduce them where more cost-effective ways can be found.
Taxpayers are due a share of the peace dividend and they expect, quite rightly, to receive full value for money allocated to the defence task. Equally, the Government have a very clear duty to Parliament and to the country at large to provide defence in the most cost-effective way. I readily acknowledge that hard decisions have had to be made and that those decisions will cause some difficulties for those affected. But I am also convinced that the transfer of the posts from Eaglescliffe to the integrated headquarters of the Naval Support Command offers by far the best advantages in terms of cost and operational benefits. The decision announced in December represents the best solution for the Ministry of Defence, for the Royal Navy and for the taxpayer.
House adjourned at fifteen minutes past ten o'clock.

ASTRA HOLDINGS PLC
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HIGHWAY CODE: HALTING ON ZIG-ZAG LINES
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NUCLEAR WARHEADS: DISMANTLING
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NORTHERN IRELAND: EC STRUCTURAL FUNDS
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