Sitting of 22 November 1995

Preamble
The House met at half-past Nine o'clock
PRAYERS
[MADAM SPEAKER in the Chair]

Common Fisheries Policy
Motion made, and Question proposed, That this House do now adjourn.][Mr. Conway.]
9.34 am
Mr. John Wilkinson: I must confess, Madam Speaker, that I was not keen on our new arrangements until you generously allowed me the opportunity to raise this morning a subject of the utmost importance to our country—the common fisheries policy. At the heart of our national discontent lies a feeling of impotence, in that an elected British Government can no longer decide our country's destiny in a sense that accords fully with our people's desires, or even with their interests.
In few areas of public policy is that frustration more manifest than over fishing. As in much else, it is the apparent supremacy of the cause of the European Union, alias the "process of European construction", over the welfare of the British people that is to blame. It lies at the root of our beleaguered fishing communities' feeling of alienation and of the wider sense of popular disbelief that any Government of the United Kingdom can any longer protect our natural inheritance of rich fishing resources against the depredations of foreign trawlers, officially sanctioned by what many people regard as an alien power beyond their effective control—the European Union.
If the common fisheries policy were working, I should have no reason to complain. Like many hon. Members, I have a personal interest in its doing so. After all, I voted for our accession to the Common Market in 1971, campaigned in favour of our continuing membership of the European Economic Community in the referendum of 1975, and voted for the Single European Act in 1985.
We all like to think that our past parliamentary behaviour and political attitudes can be justified by events, but if that natural human desire does not accord with subsequent realities, pride must give place to honest acceptance of the facts, and intellectual integrity should be our rigorous guide. I do not believe that in the case of fishing we were right to bind successive Parliaments by assigning in perpetuity our unique insular maritime inheritance, our incomparable wealth and diversity of fisheries, as a common resource to what became the European Union.
It is true that in coastal waters for up to six miles British fishermen alone may fish, that between six miles and 12 miles out, only the boats of European nations with historic rights may compete with our vessels, and that
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even beyond 12 miles a joint EU regime does not prevent United Kingdom fishing boats from fishing their traditional waters.
Nevertheless, the common fisheries policy flies in the face of intrinsic logic and of the pattern of fish stock management in north Atlantic waters adopted by northern maritime nations akin to our own. It was lack of public confidence in the conservation measures and fishing control capability of the European Community that contributed to the Norwegian people's rejection in two referendums of their country's proposed accession.
Likewise, the Icelanders, the Canadians and the Greenlanders have found the imposition of a 200-mile exclusive fishing zone to be fundamental to the husbandry of their precious national fishing resources, and to their Governments' efforts to preserve the livelihoods of isolated coastal communities where little alternative employment to fishing exists. I am not naive, and the Canadian experience shows that Canada's policy is no panacea. Job losses in the Canadian industry have been huge. Fishing bans and even unilateral action beyond the 200-mile limit—as with the arrest of the Spanish trawler Estai—have demonstrated the dire consequences of overfishing.
Nevertheless, when the Estai crisis broke, there was no doubt where the sympathies of the British people lay. Their hearts were not with European Commissioner Bonino's efforts to uphold the letter of the international law of the sea on the EU's behalf, but with the enviously regarded, spirited and decisive action of the Canadians in defence of their interests. British fishermen sailed for weeks with the Canadian maple leaf proudly at their mastheads in salute to a friendly national Government who had the courage to see off what they regarded as a common threat—European Union-supported Spanish fishermen operating far from home in waters where historically they have no place.
As my hon. Friend the Member for Ludlow (Mr. Gill)—quoting Cicero—put it so admirably in a letter to my hon. Friend the Fisheries Minister on 23 October,
"Salus populi suprema est lex",
or, the people's welfare is the supreme law. That is a classic concept to which electorates rightly expect Governments to aspire, and it should be the guiding principle both of our country's attitude to the common fisheries policy and to the evolution of the EU itself.
Let us examine some basic facts about the common fisheries policy. First, the treaty basis for it is fundamentally flawed, and rests on an assertion in article 39 of the treaty of Rome that the Common Market's agriculture measures shall extend to fisheries. There is no rationale for this, except—as we all know—that the application of the common fisheries policy to the United Kingdom was the quid pro quo exacted by the original six members of the Common Market as Britain's entrance fee to the Community. This historical aberration does not justify the UK's continued participation in the common fisheries policy, especially as decision-making under the policy is by qualified majority voting. That allows even landlocked countries such as Austria and Luxembourg a say, and policy can be potentially decided by horse-trading on extraneous matters rather than on specifically fishing issues which are crucial to the prosperity of British coastal communities and to the interests of the UK economy.

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If further enlargement of the EU occurs—to which the British Government are rightly committed—and unless we have first withdrawn from the common fisheries policy, Polish, Bulgarian and other east European vessels will be allowed access to the so-called common resource of fish stocks. Those stocks have been sorely depleted already within what should be Britain's exclusive maritime economic zone to the detriment of United Kingdom fishermen, who have seen their way of life threatened by Spanish and Portuguese fishing boats, following the accession of those countries to the EU.
Mr. David Harris: Spanish boats, mainly.
Mr. Wilkinson: I take my hon. Friend's point. Lest anyone should still allege that horse-trading is a misnomer for the European decision-making process, I remind the House that when the Spaniards threatened to block the entry of Austria, Finland, Sweden and—at that time—Norway to the EU at the Edinburgh summit in 1992 unless Spain and Portugal's full participation in the common fisheries policy was brought forward from 2002 to 1996, the UK capitulated.
Before I make my final recommendations, I must demonstrate how seriously the common fisheries policy is failing. In so doing, I will refer to the House of Lords European Communities Committee report of 1992–93. On the decline in catches, paragraph 2.5 of page 42 of the report states:
"The substantial decline in catches over the period of operation of the Common Fisheries Policy reflects the deterioration in the stocks of white fish on which the United Kingdom relies, leading to reductions in Total Allowable Catches and Quotas."
In the case of the 11 species listed—made up of various types of cod, haddock, saithe, whiting and plaice—the total allowable catch in 1982 was 868,010 tonnes, which had fallen by 1992 to 495,750 tonnes. The United Kingdom's quota in 1982 was 426,570 tonnes, which had fallen to 207,825 tonnes in 1992. The report commented:
"The volume of these species available to the Community fleet in 1992 is 372,260 tonnes less than in 1982—a drop of 42.9 per cent. The volume available to the United Kingdom fleet has declined by 218,745 tonnes—a drop of 51.3 per cent."
I move on to the question of landings. Page 41 of the report states that the figure for demersal landings in 1982 was 448,000 tonnes, but that the figure had fallen 266,500 by 1990. In the case of pelagic landings, the drop was less marked, but the figure did fall from 301,300 in 1987 to 256,900 in 1990. There is clear evidence of a serious decline of stocks, and the nature conservation committee established by the Environmental Protection Act 1990 made some very interesting comments on this matter to the House of Lords Committee.
The nature conservation committee said that the common fisheries policy
"which is the basis for regulating fisheries in EC waters, appears to have no clearly stated objectives, depending instead on those of the Common Agriculture Policy which since they address cultivation are not particularly relevant to hunting of fish. This lack of specifically directed objectives appears to result in a political rather than a scientific emphasis on the management of fish stocks.
The CFP appears to have failed to maintain many important commercial fish stocks in the EC's waters. The size of the stocks of the primary commercial species, such as those of cod and haddock,
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are at an historical low … 'Total Allowable Catches' as applied in the EC appear to have proved unsatisfactory and relatively ineffective for several reasons."
The nature conservation committee's remarks continue by stating that one of the reasons why the policy is not working is the pernicious practice of discards, whereby species in excess of the quota are thrown back into the sea dead, and the House of Lords Committee had much to say about that practice on page 27 of its report. The conservation regime is being circumvented by the procedure of quota-hopping, whereby the European Court, no less, has—as usual—proved to be the nigger in the woodpile. The Factortame judgment overturned British law and enabled Spanish interests to buy into British operating concerns, as my hon. Friends who represent Cornwall constituencies will no doubt testify.
Mr. James Wallace: That is an important point. It is a matter of concern. The hon. Gentleman says that Spanish skippers and vessels have been buying into United Kingdom stocks. Does he agree that every buyer must have a willing seller, and that the stocks must come from British fishermen? Does he understand why in France, for instance, the same kind. of transactions have not taken place?
Mr. Wilkinson: I agree. British fishermen believe that they had better get out while the going is good. They recognise that the common fisheries policy allows no long-term future for them in the industry and that they had better realise their assets, even if it means selling them to Spanish interests, as soon as possible. As to what happens in France, I have no specific information.
Mr. Keith Mans: If that is the case, what is in it for the Spanish? We are all in the common fisheries policy, so why should they be buying up those vessels?
Mr. Wilkinson: I imagine that the Spanish fishermen want to maximise their catch on a short-term basis, which is their traditional manner of operation, before they move on to what they regard as more profitable fishing grounds elsewhere
Mr. Christopher Gill: Further to the intervention from my hon. Friend the Member for Wyre (Mr. Mans), I wonder whether the hon. Member for Ruislip-Northwood (Mr. Wilkinson) would be interested in the contents of a letter from someone in Portugal whom I have consulted about fisheries there. He says:
"As far as the fishing sector is concerned it is one of the worst hit sectors of our economy … The situation is becoming explosive. Fishermen are being paid to stop fishing because the Spanish fishing fleet has more competitive production costs."
Is that not the answer to the question asked by my hon. Friend the Member for Wyre and possibly that of the hon. Member for Orkney and Shetland (Mr. Wallace)?
Mr. Wilkinson: That is indeed the answer. I am most grateful to my hon. Friend the Member for Ludlow, who speaks wisely and with great experience in these matters.
I hope that the House will agree with me that the common fisheries policy is fatally flawed and that it offers no hope of preserving essential fish stocks or of securing sustainable employment for the fishing communities around our coasts. The principal fishing communities are, of course, in the most remote parts of the kingdom, and decommissioning grants from the European Union merely exacerbate an

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injury which EU-sponsored policies themselves have already inflicted. The cruel irony is that British taxpayers' money is necessarily involved in the process.
Instead of showing a continued dispiriting acquiesence to the acquis communautaire on the common fisheries policy, Her Majesty's Government should use the forthcoming intergovernmental conference to issue a declaration of intent to our European Union partners that the United Kingdom proposes to withdraw from the common fisheries policy and declare a 200-mile exclusive fishing zone around its coasts. Where propinquity to neighbouring countries precludes that, the median line will constitute our national fishing limit. Naturally the United Kingdom would consider carefully any applications for bilateral fishing agreements on an equitable basis with other countries, be they EU members or otherwise.
Those proposals should be put to the British people for their endorsement in the Conservative party's manifesto for the forthcoming general election as the first stage of a carefully considered Conservative process of recuperation of powers and competences from the institutions of the European Union to the British judiciary, Government and Parliament to help create a European Community of sovereign states in which the national interests of the participating countries are fully safeguarded. I believe that the British people would regard those proposals as courageous and fair, and they would be relieved that at last they had a Government who shared their common aspiration that the United Kingdom should remain proud, independent and free. Our brave fishermen would also have found an effective champion at last.
9.54 am
Mr. Austin Mitchell: I congratulate the hon. Member for Ruislip-Northwood (Mr. Wilkinson) on securing this debate and on the strength and vigour with which he has put an argument which is extremely strong and very difficult for Ministers to rebut. I have no doubt that they will try to do so, but it is an argument that is impossible to rebut because the common fisheries policy has been a disaster for Britain and it was always intended to be such.
The principle of equal access to a common resource is the basis of the common fisheries policy. The policy was stitched together a matter of months before the British application for membership. It was deliberately designed to obtain access for European fleets which had outfished their waters to the rich fishing waters around the British coast. The principle was misguidedly accepted by the then Prime Minister in his impetuous rush to get into Europe. He was perfectly prepared to sacrifice the interests of a small and, to him, unimportant industry to get at the major point, which was membership of Europe.
Half of the fishing industry protested loudly. The inshore fishing industry saw what was coming and saw that the intense competition would drive it out of business. The big boys—the distant-water fishing fleet—were preoccupied with Iceland. They thought that they would be able to continue catching enormous quantities of fish in Iceland. So they thought that European waters were of no importance to them. Therefore, they made no particular protest.
So the industry was effectively not consulted. The national interest was not consulted. We were pushed into a situation in which we contributed more than 75 per
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cent.—let us say three quarters for convenience—of the major stocks of the so-called common market pool. That three quarters was in British waters. We were given a small catch, perhaps a quarter of the total catch—less by value—in return for our enormous contribution. That was a massively unfair principle. It produced the consequence that it was impossible to do what was logical in the 1970s when Iceland took its 200-mile limit and started the trend to 200-mile limits. It was impossible to follow suit by taking our territorial limit to 200 miles or the median line and redeveloping and rebuilding our fishing industry in our own waters. That was the logical thing to do. That was what everyone else did.
Although it is true that other countries now suffer problems of overcatching, it is also true that only the nation state has an interest in building up and conserving its stocks because only the nation state has an interest in handing them on to future generations of its fishermen. That is in no one else's interest. Other countries want to fish them out as a disposable resource and keep over-large industries going.
Mr. Mans: Let us get the record straight. Is it not right to say that when the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) was responsible for fishing matters in the 1970s, he was offered 64,000 tonnes of fish by the Icelandic Government, but turned it down because he wanted more? As a result we got nothing. That is one of the main reasons why our deep-water fleet has ceased to exist in international terms.
Mr. Mitchell: It may be convenient for the hon. Member for Wyre (Mr. Mans) to blame the demise of his distant water fleet on my right hon. Friend the Member for Birmingham, Sparkbrook, (Mr. Hattersley), but the facts are different. If the hon. Gentleman wants to read about the matter, he will find in next week's issue of The House magazine an article—if I can give it a plug—written by the hon. Member for Great Grimsby which details what happened in those negotiations. The offer of 68,000 tonnes for a limited period was turned down at the insistence of the industry. Not the Government but the industry insisted that it wanted more. It wanted more than it had the capacity to catch. That was a foolish negotiating move by the industry. That was the reality. Therefore, it is unrealistic to blame the Labour Government. I do not want to go into the history.
The abdication of British rights to control British waters by the Government of the right hon. Member for Old Bexley and Sidcup (Sir E. Heath) was the crucial factor in preventing us from following up our loss by building up our own fishing industry in our own waters, which are the richest in the world. That was the crucial failure. We would do better to do what is obviously in our interests, which is to catch our own fish and land them here, rather than doing what we are doing, which is to allow other people to catch our fish and sell it back to us, getting the jobs and profits.
The argument that is usually put forward, that fish migrate, is fallacious. Most of the stock breed, live and are caught in our waters. Only a minority of species move about. It is stupid to suggest that European countries might catch those while they are young and immature just for the sake of spiting a British Government who take control of their own waters. It might apply to the Spanish, but not to anyone else.

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The fact is that we should come out. It is in our interests to do so. It is in the interests of the British fishing industry and it is straightforward. All that we have to do is to provide that the European Communities Act 1972 does not apply to the Fishery Limits Act 1976 and revoke the licences given to vessels from specified European countries to fish in our waters under that legislation. Parliament cannot bind itself and a present Parliament can easily provide that the legislation shall not apply. The mechanics of doing so are very straightforward, even simple.
The question is whether we have the will to do so. Have Ministers got the will and the determination to do it and to face up to the confrontation that will inevitably result? That is the real area of doubt. I do not think that Ministers have that will. Even in the present situation, they are always overruled when it comes to European negotiations. The interests of the fishing industry are always sacrificed to gain some so-called higher good for the Government. That is what happens and it has happened repeatedly. The present Minister is heir to that long legacy of betrayal of the interests of fishing because something else is more important to the Government.
The hon. Member for Ruislip-Northwood gave the classic instance—the desire to get Norway and the other states in, which led the British Government to overrule fisheries Ministers and give the Spanish access to the common fisheries policy six years early. It was a fallacious desire in the case of Norway and we gave the Spanish full status early.
That is a constant pattern. It is only the most flagrant example of what has been going on for years. Frankly, rather than defending and justifying the common fisheries policy and pretending that we derive benefits from something that manifestly does damage, it would be more intellectually honest and convincing to the House if Ministers gave us an honest picture of the position and said that the advantages lie with coming out, but that they have not got the will to do it.
We certainly do not gain anything from this common fisheries policy. Ministers' usual argument is that we have access to markets for our fish, as if it will be turned away from European markets. The world is desperate for fish and it is inconceivable that the Community would block British fish going to Europe if we did the logical thing and caught our fish with our vessels, landed the catch here and sold it on European markets. Access would certainly not be refused; it could not be.
So, that is a stupid argument and it shows a grovelling intellectual attitude towards Europe. We always abdicate our case. We do not recognise the realities and we always start negotiations from a very weak position. We are negotiating on our knees, saying, "Yes, yes. The common fisheries policy is wonderful," and asking what little change or benefit can be given to us by moving the goalposts in a common fisheries policy that, frankly, is disastrous for this country.
We should recognise realities because the crunch is coming. There will have to be a massive reduction in the British fishing effort because we are well over our multi-annual guidance programme targets—further over than anyone else. That will force Ministers to enforce a massive reduction on the British fishing industry. Yet, we
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are the nation with the stocks and the waters—the nation that contributes everything to that policy, to make room for Spanish vessels.
That reduction will be forced on us by European overfishing and by the principle of equal access to a common resource, which has decimated our stocks. Because of that decimation, Ministers will have to close large sections of the British fishing industry and that is a monstrous thing to do to this country.
The second crunch that is coming is the same one as applied with Spain—the principle of nations coming into the Community with huge fishing fleets, but no waters to contribute to the common fisheries policy, whose demands are satisfied at our expense, in our waters. That has already happened with Spain. Ministers have supinely given way to that monstrous principle.
This country is now anxious to turn the European Union into some sort of continuous rolling row and to weaken and dilute it by bringing in a confused babble of other states. We are now pressing the cases of eastern European states, many of which have huge fleets but no waters in which to catch the fish. On the principle of equal access, they will have a claim to fish in British waters. How are we going to resist them? We could not resist that claim in Spain's case. When Bulgaria, Poland, Estonia, Latvia and Lithuania come in with their fishing fleets, what will be our answer? That will break the common fisheries policy.
It would be intellectually honest and much more acceptable to the House if Ministers said this: although a disaster is looming, we have certain strengths in that we contribute waters and that we are prepared to take a tough stand for Britain; we will do that and, if it risks putting us in an exposed position, we will come out. That is the only ultimate safeguard for our fishing industry and that is the intellectual position that I want Ministers to take.
10.6 am
Mr. David Harris: I am sincerely grateful to my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) for initiating this debate. Some hon. Members may think it odd that some of my hon. Friends who represent constituencies many miles from our coastline are here for the debate. I see my hon. Friends the Members for Billericay (Mrs. Gorman), for Ludlow (Mr. Gill) and for Boston—
Sir Richard Body: Boston?
Mr. Harris: I am sorry.
Sir Richard Body: May I draw my hon. Friend's attention to the fact that we still have 40 boats left, although we used to have many more. We also used to have a fish processing industry, which has now gone to the Netherlands because the Dutch Government are more vigilant on behalf of the fishing industry than are our Government.
Mr. Harris: I apologise profusely to my hon. Friend, if he will now contain himself. I made the crucial error of lumping him in the same category as other hon. Members who perhaps look at such matters from a different perspective from those of us who represent constituencies along the coast. I recognise their genuine concern about the common fisheries policy and very

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much welcome their interest in the subject because it is part of a process that has brought to the fore the crisis in the fishing industry.
I welcome support from all sources in the process of making the House, the Government and the European Union face up to the crisis that our fishermen face. I was absolutely delighted, as were my constituents, when, yesterday, His Royal Highness the Duke of Cornwall visited Newlyn in my constituency and spent the morning considering the problems of the fishing industry and talking at length with the people who really matter—those who work in the industry, such as fishermen, fish merchants and harbour commissioners. That is a part of the one good thing that has come out of this crisis during the past few years, which is heightened interest in it. People are at last paying attention to the problems of the fishing industry, and that is good.
I must say a few words on the speeches of the hon. Member for Great Grimsby (Mr. Mitchell) and of my hon. Friend the Member for Ruislip-Northwood, who initiated the debate. We are all a little in danger, if not of rewriting history—although I agree with much that my hon. Friend said—then of forgetting how certain aspects of the problem, such as the common fisheries policy, came about.
The hon. Member for Great Grimsby is right: the fishing industry was a pawn in our negotiations to enter the European Community or, as it was then, the Common Market. I recognise that, and I speak as somebody who would like to regard himself as pragmatic, down-to-earth European.
The hon. Member for Great Grimsby referred to the deep-sea fishing industry. It is nowadays overlooked completely—perhaps it is forgotten—that, when we were going into Europe, the deep-sea fishing industry pressed the principle of open access and, with respect, it was not for the reason that the hon. Member for Great Grimsby gave. It was because, having lost its rich fishing fields around Iceland because of the 200-mile limit, the industry thought that it would be able to gain access to what are now Norwegian waters.
Mr. Austin Mitchell rose—
Mr. Harris: I shall not give way because we are all pressed for time. We can discuss it afterwards. I could give the hon. Gentleman chapter and verse from a book on the history of the common fisheries policy.
My hon. Friend the Member for Ruislip-Northwood was right to say that exclusive control over what we like to call our waters would not in itself solve the problem. He mentioned Canada, which has had 200-mile limits. Canada fished out a lot of its shoals although it had exclusive control over those waters.
I had the good fortune, as a member of the Foreign Affairs Committee, to go to New Zealand. I took a little time off from foreign affairs matters to go to the Ministry of Fisheries to see how it managed its 200-mile zone and its system of individual transferable quotas. They have problems and disputes in New Zealand. Indeed, when I was with my colleagues in the Parliament in Wellington, an almighty dispute broke out which involved representatives of fishermen from Chatham island complaining about other boats coming into their waters. They happened to be New Zealand boats. There have always been disputes between fishermen and there always will be.
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My hon. Friend the Member for Ruislip-Northwood also mentioned Iceland. I had the pleasure, I think with the hon. Member for Great Grimsby, to give lunch to the deputy director of research for maritime resources in Iceland. He told us that although Iceland started the process of claiming 200 miles, it still had huge problems of overfishing inside its waters and that there is now a considerable movement in Iceland to extend the 200-mile limit. Please, please let no one think that even if we could regain control of our waters, it would solve all our problems. The hard fact is that practically every nation in the world is overfishing because of new technology—new means of locating fish, new sorts of gear and the power of engines.
We can argue about the common fisheries policy, of which I am no friend. As has been said, the way that it was forced upon us was deplorable. I regret bitterly many aspects of the common fisheries policy, but if it was scrapped tomorrow, there would still be problems in the fishing industry and the resolution of those problems would involve huge pain and difficulties for our fishermen.
I shall now deal with the simple case that we can withdraw from the common fisheries policy as easy as anything. The hon. Member for Great Grimsby said that the mechanics are simple and straightforward. I agree with him about that in respect of withdrawal, but the repercussions of unilateral withdrawal would be immense. I wish the hon. Member for Great Grimsby, my hon. Friend the Member for Ruislip-Northwood and others who advocate unilateral withdrawal would be honest and open and say what they really believes: that we should withdraw and that if we do not get our way, we should withdraw from the European Union. [HON. MEMBERS: "That is not what we are saying."] That was not what was said, but it would be the consequence.
Mr. Wilkinson: Will my hon. Friend give way?
Mr. Harris: I will not give way because we are pressed for time and other hon. Members want to speak.
I shall tell the House what would happen, as night follows day, if we tried to withdraw unilaterally from the common fisheries policy. Despite what the hon. Member for Great Grimsby said, there would be an immediate backlash and the 90 per cent. or so of the fish that are exported from Newlyn to France and Spain—certainly the element that goes to Spain—would be stopped by blockades overnight.
Sir Richard Body: Rubbish.
Mr. Harris: My hon. Friend can shout, "Rubbish" but that is what the immediate consequence would be. I do not say that a blockade would continue for ever and a day; I doubt that it would. In the long term, the hon. Member for Great Grimsby may be right. I know the Spanish fishermen pretty well.
Mr. Gill: Will my hon. Friend give way?
Mr. Harris: No, I shall not. I know Spanish fishermen pretty well and, as the hon. Member for Great Grimsby also knows, there would be immediate retaliation, at least in the short term.
Further, if we stayed in the European Union, we would be taken to the European Court. My hon. Friend the Member for Ruislip-Northwood referred to the perverse

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or diabolical judgment of the European Court in the Factortame case, over which the House was overruled. That was something for which I had been fighting long before many in this House showed any interest in fishing—doing something about the curse of the flag of convenience vessels.
One does not have to be an international lawyer to know what would happen if we withdrew unilaterally from a treaty with which we have at least gone along. It is one thing to negotiate an opt-out from a future European policy, but what is being proposed today is that we should withdraw unilaterally from a policy to which we have been party for many years. We would be challenged in the European Court and there is not the slightest doubt that we would lose. Hon. Members who advocate such a course should argue that we should stand up on the issue and then, if necessary, withdraw from the European Union. That at least is a tenable position. I disagree with it, but it at least has some sense and one could argue it. The suggestion that we can, without consequence, withdraw unilaterally from the common fisheries policy is absolute nonsense and does great damage to the fishing industry because many people buy that line without realising the consequences.
What should we do? There is a problem of great importance to constituencies such as mine. If I may refer again to the visit of His Royal Highness yesterday, the message of the fishermen of Newlyn was that they cannot see a future for the industry given the way things are going and with the pressure for reductions of our quotas. There is the cursed business of the Spanish. Indeed, on 1 January, Spanish boats will come into waters from which they were previously excluded—some of the waters of the so-called Irish box. What should we do about the consequences that will flow from that?
When the decision was taken on 22 or 23 December last year to allow the Spanish into those waters, I learnt a severe lesson. On that day, in the face of every conservation argument, the decision was taken to allow extra boats into those waters—rich fishing grounds for our boats—from January 1 next year. That was done because of the system of qualified majority voting. We were outvoted. Indeed, our Minister made a grievous mistake, in my estimation, when he only abstained. That would not have made any difference in the end, however, because all the other member states voted for the deal that emerged and we were left isolated. That must not happen again when we renegotiate the common fisheries policy in 2002. That is the big danger which has not been mentioned in the debate today.
Mr. Gill: Will my hon. Friend give way?
Mr. Harris: No, because I am pressed for time. I am sorry. I hope that my hon. Friend will catch your eye, Mr. Deputy Speaker.
The danger is that, with the renegotiation of the common fisheries policy, which has to be done by 2002, we might have to face true open access and the abolition of all the fishing rights that we now have. That would mean the end of the fishing industry as we know it.
The first thing to do—I have been pleading with Ministers about this behind the scenes for a long time—is, as part of the intergovernmental conference, to make a
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determined attempt to restore the national veto. I know that the Liberal Democrats want to abolish the national veto. We must make a serious and determined attempt and we must make it a sticking point that we restore the national veto on the final outcome of the renegotiations of the common fisheries policy in 2002. That is the most practical and urgent task we can set ourselves. It is also the most important. There are many other things that we could do, but I do not have time to go into them now.
I plead with my hon. Friend the Minister of State, as I have pleaded, dare I say it, from the top of the Government down, that that task should be our objective. If we do not succeed in that objective and if we end up with a common fisheries policy that allows open access, our fishing industry will never forgive the House.
10.21 am
Mr. James Wallace: I endorse the congratulations to the hon. Member for Ruislip-Northwood (Mr. Wilkinson), who has done the House a great service by introducing this debate. It adds to the number of fisheries debates that we have in the year and it addresses an issue that raises considerable interest. Those of us who, over the years, have regularly attended fisheries debates welcome the interest that is now being taken by hon. Members who represent non-fishing constituencies in the common fisheries policy.
The hon. Member for Ruislip-Northwood conceded that he supported the terms of accession in 1971. I suspect that he did not then speak up for the fishing industry, which was making representations that it did not believe that the arrangements were fair. The renegotiations by Harold Wilson's Government did not take the fishing industry's interest into account either. We have suffered from the fact that, by its nature, the fishing industry is scattered around the coastal areas of the United Kingdom. It has not had the collective clout to put fishing issues to the top of the agenda. That is a historical matter. If we had a Scottish Parliament and regional assemblies in England, fisheries would loom far larger in the economies of those areas and would be an issue that Governments could not ignore as readily as they have.
I cannot accept that the simple solution proposed by the hon. Members for Ruislip-Northwood and for Great Grimsby (Mr. Mitchell)—that with one bound we are free from the common fisheries policy—is tenable, for many of the reasons advanced by the hon. Member for St. Ives (Mr. Harris). We can leave the common fisheries policy either by agreement or by a unilateral measure. I do not see for the life of me how by leaving the CFP we could get a better deal than by staying in it and seeking reform. A unilateral decision would have industrial consequences, which the hon. Member for St. Ives mentioned, legal consequences and political consequences. If nations in the European Union that have entered into treaty agreements start picking and choosing the ones with which they will continue and those which they will abrogate, it will be the start of the collapse of the European Union as we know it. If the Conservative Members who argue for that were open enough to say that that is what they want, the intellectual credibility of their argument would be greatly enhanced.
Some say that we should move towards the abandonment of the common fisheries policy. I do not believe that that is a solution either. It has already been

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said the fishing industries of countries with 200-mile limits have not prospered—one needs only to read the large section in this month's National Geographic on the perilous state of fish stocks in many parts of the world or Newsweek of 25 April 1994 to realise that. The article says that with the increase in territorial seas from 12 miles to 200 miles,
"The hope was that coastal states, angry at overfishing by foreign factory ships, would take a protective interest in the fishing grounds under their vastly expanded domain. Instead, they rushed to plunder the saltwater bounty, offering generous subsidies and tax breaks for new fishing vessels."
The article then points out:
"In Atlantic Canada, the collapse of cod now threatens the survival of hundreds of fishing villages … More than 500 small villages on Russia's Pacific coast are similarly threatened by overfishing of pollock."
Earlier, the article states that even where there are 200-mile limits
"every valuable fish that straddles or migrates across this border has been hit hard by foreign fleets".
Mr. Austin Mitchell: Will the hon. Gentleman give way?
Mr. Wallace: No; I shall allow more hon. Members to speak if I restrict my remarks.
Increasing national limits is not a guarantee of success in containing overfishing.
If we abandoned the CFP, fisheries policies would be in the hands of the United Kingdom Government. The hon. Member for Holland with Boston (Sir R. Body) made an interesting intervention in which he pointed out to the hon. Member for St. Ives that the fish processing industry in his area had disappeared and had gone to the Netherlands because the Dutch Government were more vigilant in looking after their interests than were the United Kingdom Government. The Netherlands is, of course, within the common fisheries policy and is subject to the same rules. That suggests to me that we should make a clear distinction between what, at times, are problems of the common fisheries policy and what, at other times, are problems caused by a lack of vigilance and a lack of proper attention to fisheries over many years by our Government.
The fishing industry was not very happy with the days at sea legislation proposed by our Government. Sir George Younger, who was Secretary of State for Scotland when the CFP was being negotiated in 1983, advised fishermen in my constituency that, in addition to the Shetland box, special regard would be given to the representations made by the Shetland Fishermen's Association and the Orkney Fishermen's Association when framing inshore fisheries legislation. The legislation, however, proposed a limit of six miles, to which the inshore fisheries legislation applies and which is purely in the hands of the United Kingdom Government. The recommendations from my local fishermen's associations were ignored. There is no guarantee that repatriation will deliver any better a deal for fishermen than we have seen in recent times.
We must adopt a much more vigorous approach on behalf of the fishing industry. To be fair, the previous Minister, the hon. Member for Fylde (Mr. Jack), took a greater interest in fisheries than any of his predecessors,
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and the present Minister seems to take such an interest as well. Fisheries are an important issue on the agenda of the House and on the agenda for negotiations in Europe.
I suggest that we look forward to fundamental reform within the European Union. We should appreciate and accept that the negotiated deal on relative stability was, in many respects, good for the United Kingdom. It has been undermined by the flagging out of vessels and we have not fully understood how many other countries have managed to avoid the same loss of fishing vessels. We have fishing vessels that fly the British flag, but which, de facto, belong to other nations. It is always difficult to say that one is right after the event, but if the advice of those of us who advocated a regional system of licensing to try to ensure that licences remained with communities dependent on the fishing industry had been heeded when licensing was introduced in 1984 or 1985, some of the problems might not have arisen.
Some of the present arrangements are almost contrary to the principle of relative stability. In many respects, the hon. Member for St. Ives used the right word. The Factortame judgment was perverse and it does not sit alongside the principle of relative stability.
In any reform, we want to ensure that those principles of relative stability are retained. We also want some clear assurances that the derogation from equal access will be extended. With my hon. Friend the Member for Roxburgh and Berwickshire (Mr. Kirkwood), I visited the Commission in Brussels last week. We had discussions with Mr. Alain Laurec and others. Our impression was that no country has actually pushed for or raised the idea of abandoning that derogation. If Ministers could give an early confirmation of that, the industry would be greatly reassured.
Perhaps we should take a more regional approach to fisheries. The example has been given of the Clyde herring fishery, which is 100 per cent.—or at least 98 per cent.—operated by British vessels. In many respects, there is no reason why decisions affecting that fishery should go to Brussels for approval when they affect only United Kingdom fishermen. We should examine the possibility of decisions on Mediterranean fisheries being made by member states with Mediterranean interests, and the same for the Baltic and the North sea.
A more regional dimension to the common fisheries policy would mean that management decisions affecting an area of 12 to 200 miles would involve the fishermen and member states of those fishing vessels that have historic fishing rights in those areas. Land-locked Austria would not then make decisions on such detailed matters.
We must face the fact that as we move to the next round of multi-annual guidance programmes, Britain will still not have reached the targets set by the present one. In such a short debate we cannot go over the history of why decommissioning was not introduced earlier, and with more money. At this point, we would like to know what the Government's attitude is to the fact that the European Union is providing very little funding to build new vessels. I understand that from the European Union's perspective, as we have not reached our present target, the allocation of more money would be difficult to justify, but the aggregation of licences might allow for new vessels on a scrap-and-build basis so that our fleet does not grow older and less efficient.

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Technical conservation measures must have a place. Square mesh panels, which have been the subject matter of many debates in the House, seem to have taken a back seat in discussions on conservation.
I welcome the announcement that the Minister made last week on the involvement of fishermen in the discussions that will lead to the setting of TACs for next year. In last year's European elections, I put forward a policy paper that suggested that fishermen, scientists and Government officials should be involved. Any system that involves fishermen in setting TACs is more likely to command consent and respect.
The common fisheries policy should comprise a host of other detailed matters. I welcome the review group and look forward with interest to the outcome. The year 2002 will come upon us sooner than we think, and we must begin to put in place the measures that we want to see by then.
The IGC has been mentioned, and my colleague the Member of the European Parliament for Cornwall and Plymouth West has argued for the common fisheries policy to be on the agenda. He has not had much support from Conservative or Labour Members of the European Parliament. The key issues that are worrying many countries must be tackled in the next seven or eight years and should be highlighted as early as possible.
Those of us who represent fishing communities recognise that, in some parts of the world, fishing is one of the few opportunities for economic activity. The common fisheries policy should be much more oriented towards sustaining fishing communities, which provide important employment; not just offshore in the catching fleet, but onshore in processing and, ultimately, in marketing.
Proposals to abandon the common fisheries policy are politically dangerous and naive, but much more needs to be done to reform it substantially. [Interruption.] The hon. Member for Great Grimsby may laugh, but there is a fundamental difference between abandonment and reform. We can go forward with confidence only within the European Union, because fish do not recognise international boundaries.
10.35 am
Mr. David Porter: I congratulate my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) on securing this debate. He and I attended the same fringe meeting at Blackpool last month, which was attended by 400 people. Apart from the meetings addressed by my right hon. Friend the Member for Wokingham (Mr. Redwood), that meeting had the biggest attendance of any fringe meeting.
It does not take a genius to realise that the common fisheries policy has failed to conserve fish stocks. If fishermen catch anything outside their quota, they have to discard it and throw it overboard dead. How does that help conservation? A Shetland skipper recently described how a young lad, on his first trip, wept as 10 tonnes of prime fish were dumped dead back into the sea, simply because that vessel had no licence for the particular species.
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I have always likened the common fisheries policy to a raft that does not float properly. Each year, a new piece of bureaucratic nonsense is bolted on to try to keep it afloat. Eventually, the raft will sink and take most of British fishing with it. It would be better to get off now.
The official line is often that in a mixed fishery nothing can be done. That is not true. Successful selective gear is being developed in other countries, and their method of management has changed to stop immoral practices. The rape and pillage of the seas takes place even in the third world, where the European Union buys fishing rights at vast expense. In some areas, European Union vessels have been thrown out of fisheries because of the damage that they have caused. Local fisheries have then reverted to local country control and marine resources have recovered significantly.
Brian Tobin, the Canadian Fisheries Minister who visited the United Kingdom this summer, said:
"Conservation is now the watchword of people everywhere."
The recent United Nations conference on fishing highlighted two points: the importance of fishing to coastal communities around the world and the need to work together to maintain the tremendous resources of the oceans. However, the common fisheries policy of the European Union, as implemented in this country, has become so rigid that it is scarcely possible to make a living legally, much less co-operate to conserve fish stocks.
The common fisheries policy encourages law breaking. Our industry has proposed many ideas for sensible management in the past few years. Not all of those ideas have yet been considered by the Government. Fishermen who want to conserve can reap no benefit under the CFP. If they stop killing the small fry and stop dumping mature fish into a stinking, rotten mass on the sea bed, the preserved stocks just go back into the great European pool.
The driving force in the market is the southern states, whose traditional cooking and eating habits require small juvenile fish. Therefore, as those fleets come through our back door with their armadas, they scoop up the juvenile stocks that British fishermen are trying to preserve. The common fisheries policy is therefore a disincentive to conservation. Potentially, if left to run, it will destroy a renewable food supply that is more valuable over the years than even our gas or oil reserves, and will have devastating consequences for the social fabric of our coastal communities. That is criminal.
A Conservative Member of the European Parliament who lost his seat at the last Euro-election told me many years ago that if we did not have the common fisheries policy, we would have to invent it. Surely, if we were starting again, we would not start with the premise that the seas are a common resource open to all, unless we were Euro-fanatics or my right hon. Friend the Member for Old Bexley and Sidcup (Sir E. Heath), or both. We would start from the premise that British fishermen have a historical, economic and cultural right to fish British waters and then do bilateral deals, as appropriate, with our neighbours. We would not, as the Government did in Lowestoft this year, swap North sea plaice with the Dutch in exchange for soles that were then given to the south-west—a quota that those fishermen cannot probably take up in full. That meant that £1 million worth of plaice went out of Lowestoft this year. Following scientific evidence, the likely TACs for next year will mean a 47 per cent. cut in North sea plaice.

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As recently as yesterday, I had a very constructive meeting with my hon. Friend the Minister of State and some fishermen from Lowestoft. I understand my hon. Friend's dilemma: does he set the quota high enough to allow fishing to continue and risk there being no fish in two years' time, or does he ignore scientific advice and listen to what fishermen are saying?
The Commission has determined a target size for the European fleet and Britain has accepted the British share of that fleet reduction. Thousands of fishermen have lost their jobs, and more will follow; that is European Union policy.
Quotas, fuel and tux, salaries, bureaucratic procedures and unfair competition from our partners make our fishermen bankrupt, and they are then told that some of them can apply for money to retrain. What do they retrain for in parts of the country where unemployment is already high? They can move away, but where do they move? It is madness.
Fishermen following lines of generations born and bred into the job, simply want to fish. In any local family in Lowestoft, one can find that, dating from one, two or three generations previously, there is fishing in the blood. Those people are not being allowed to fish a manageable and renewable resource because of a wider, sinister European agenda. It is a national disgrace, and the sooner we get out of it, the better.
10.40 am
Mr. Elliot Morley: I add my congratulations to the hon. Member for Ruislip-Northwood (Mr. Wilkinson) on initiating this important debate. Obviously, many issues relating to the common fisheries policy need to be considered and acted on by all parties, especially the Government.
Obviously, people approach that issue from several different directions and there are many different agendas in the debate. Although there is a very significant issue relating to the CFP which must be considered, the CFP should not be used as a vehicle for those people who wish to attack the principle of the European Union without recognising the CFP's role.
I was one of the people who voted against membership of the European Union and campaigned accordingly, but I do not believe that any Member of the House seriously believes that we intend to withdraw from the European Union. It will not be on the agenda.
My opinion, and that of the Labour party, is that we must work in the European Union for the best interests of our country and our communities. That can be done by taking a positive and constructive approach, which means that on occasions there will be disagreements with other member states; it cannot be done by taking a negative and isolationist approach, which I am afraid has been all too common in sections of the Conservative Government.
The demand for a 200-mile exclusive fishing limit is attractive. In an ideal world, if we could achieve that, no one would disagree with the object. However, I do not believe, with the greatest respect to those people who have been leading such a campaign, that it is a credible or achievable object, for reasons that have been outlined in the debate. There would be great problems with that.
Even if we adopted that position, we would be negotiating with other North sea states with traditional historic fishing rights in the North sea, and those 239912 K
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negotiations would be extremely difficult. Trade-offs would be inevitable. I do not deny that trade-offs took place in the negotiation for the original CFP, or that some of the principles behind that have been to the advantage of the fishing industry.
Nevertheless, the CFP has certain advantages. I also draw attention to the fact that the 1980s was a time of great prosperity for the United Kingdom fishing fleet and no complaints were made about the CFP at that time, when the fleet was expanding and grants were given to expand the fleet.
The argument has been well made in the debate that, even without a CFP, there would be problems in our fisheries management. The UK fleet has problems now, such as black fish, which has a devastating impact on fish stocks and prices.
It is not fair to consider the role of other member states negatively. In recent discussions about the western controls, the Spanish presidency helped us to reach a workable compromise that was acceptable to the fishing industry.
The principle of relative stability protects the interests of our country, and has protected the interests of our country in such things as preventing access to the North sea by the Spanish. It does not necessarily follow that an extension of the European Union would mean that other member states' fishing vessels would have access to our fishing stocks.
I acknowledge the frustration of many sections of the fishing industry. I have visited many fishing ports and spoken to fishermen. I understand how they feel; I understand the fear for their jobs and their future. I understand their worries, with an aging fishing fleet and little chance of a scrap-and-build policy while we are so far adrift from our multi-annual guidance programme targets. In that respect, it is not fair to blame the current problems of the fishing industry entirely on the CFP. The Conservative Government must take some responsibility.
For years, the Government refused to introduce an effective decommissioning scheme although European Union funds were available. Part of the problem that we have now, with the lack of modernisation, stems from that. I question whether, on occasions, our Government took a tough stand in representing the interests of our fishing industry, because of the number of other conflicting interests that were of concern to the Government.
I return to the involvement and responsibility of the country's fishing industry. The industry has been constructive and helpful in suggesting good ideas for fisheries management and fisheries conservation. Some of those ideas should be taken more seriously—such as a ban on twin prawn trawls and the introduction of square mesh panels. There are ways in which that might be done in the CFP, as I shall explain later.
We cannot ignore the fact that our fleet has undertaken illegal activities. There has been increased pressure as a result of increased catching ability, more powerful vessels and increased use of technology. We cannot ignore those issues. We cannot ignore the fact that gear conflict, which sometimes occurs between our vessels and French and Spanish vessels, goes on regularly along our south coast among our own vessels, between the mobile fleet and the static fleet. Co-operation is therefore needed within the industry, and we need a united fishing industry.

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The campaign for a 200-mile limit and withdrawal from the CFP has proved extremely divisive in the fishing industry. That is not helpful.
Mr. Gill: Will the hon. Gentleman give way?
Mr. Morley: If the hon. Gentleman will excuse me, I have little time. I do not want to take time from the Minister, who wishes to respond to the debate.
I want to mention a few aspects of the way in which members of the Labour party regard the CFP and ways in which we believe that it can be reformed and made more workable in the present structure.
My hon. Friend the Member for Great Grimsby (Mr. Mitchell) recognised and analysed succinctly some of the problems in the CFP and the way in which it has affected the industry. The hon. Members for St. Ives (Mr. Harris) and for Orkney and Shetland (Mr. Wallace) made some good arguments about the need to take a practical approach to the CFP.
It is important to tackle certain things, such as industrial fishing, which is primarily pursued by the Danes. We cannot tackle the problem of industrial fishing, which I believe should be prevented in the North sea, unless we do so by negotiation through an organisation such as that surrounding the CFP. There is no other way of doing it.
The CFP has certain advantages in ensuring proper management of our fish stocks. We need to protect our six and 12-mile limits and it would be desirable to negotiate, if possible, a small extension to give greater protection to local fleets on a regional basis.
The key to CFP reform is for member states to have greater autonomy in applying their own management. There is no reason why that cannot be done in the CFP. It would be interesting to hear the Minister's opinion on that. As long as it is applied on the basis of non-discrimination, there is no reason why we, as a member state, should not argue for such things as compulsory square mesh panels and certain closed areas at times of spawning in our own waters, which would apply to all vessels fishing in UK waters. We can have that autonomy in the structure of the CFP on a non-discriminatory basis.
We should review the way in which the quota management system works because of the problem of discards, but that problem is not unique to the CFP quota management system. There is a serious problem with discards in, for example, the northern mixed fishery method, which we need to tackle.
We cannot argue that we in this country have an absolutely clean record on fisheries enforcement. There have been problems in the United Kingdom which we need to tackle. With good will and with some commitment from the Government, we can enjoy the advantages of national control within a European and international fisheries management scheme, based on a reformed CFP. The overriding priority for the future of our fishing fleet and the environment of our seas must be a sustainable and properly managed fishing industry. That aim can be achieved within the present structure and we should not argue for an untenable position.
10.50 am
The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. Tony Baldry): It is customary in such Adjournment debates for the Minister to come to the Dispatch Box and congratulate the hon. Member involved on succeeding in obtaining the debate. I do so today and, moreover, I am genuinely grateful to my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) for initiating today's debate as it provides me with a welcome opportunity to place on record my approach to the CFP. It also provides a welcome opportunity to clear up, once and for all, a number of misconceptions about the CFP that appear to have arisen recently. I also welcome the support on the Front Bench of my hon. Friend the Member for Aberdeen, South (Mr. Robertson), who is the Scottish Fisheries Minister.
As the United Kingdom's Fisheries Minister, I have only one purpose and aim: to represent and promote the best interests of the UK fishing industry and of UK fishermen. I hold no brief for the European Union and I certainly hold no brief for the European Commission or the European Parliament. My concerns are solely for the well-being of the UK fishing industry.
Since moving to the job in July, I have spent much time visiting fishing ports up and down the country and I have had the opportunity to listen at first hand to the concerns of the industry, both locally and nationally. There is no doubt that the fishing industry feels itself to be vulnerable, threatened and under pressure, and finds it difficult to see where its future lies. But the threat to the UK fishing industry does not come from foreigners; the real threat to it, as to fishing industries throughout the world, comes from dwindling and depleted stocks of fish around our shores, as was made clear in the excellent speech of my hon. Friend the Member for St. Ives (Mr. Harris). The biggest recent blow to the UK's fishing fleet came not when we joined the Common Market but when, in the 1970s, we lost access to the distant waters and fishing off Iceland and elsewhere.
I want the UK fishing industry to be stable and sustainable so that those involved in it have the confidence to make investment decisions for the future. I want an industry that has a clear purpose and direction as we approach and enter the 21st century. I am sure that the industry recognises, as do most sensible commentators, that to have a sustainable fishing industry it is necessary to match fishing effort—the effort taken to catch fish—more closely with the fish available in our seas. That requirement will result in a slimmer fleet, but I hope that it will be a more sustainable fleet that is able to invest for the future.
Some people suggest that any problems caused to the fishing industry occurred as a result of our membership of the European Union—particularly, our participation in the common fisheries policy—and that it would be in the best interests of the UK fishing industry for Britain unilaterally to seek to exit from the CFP. There are undoubtedly concerns about the workings of the existing CFP, which is why Ministers have set up a CFP review group with a view to examining in detail the present workings of the CFP and recommending how it can be improved to benefit our industry. That group has been working hard during the year and has received many submissions. It is drafting a report and I hope that it will be in a position to publish its report and its findings early next year.

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The UK has been a member of the European Union for nearly a quarter of a century. It is clear from reading the debates of the time that, when in 1971 the House debated the possibility of Britain's membership, hon. Members were perfectly well aware that if the UK joined the Common Market it would join not only a common agricultural policy but a common fisheries policy. That fact was made perfectly clear in the debates at the time and in article 38 of the treaty. In the event, the House decided, by a majority of 112 votes, that Britain should join the European Community.
In 1974, an incoming Labour Government—for the internal political necessity of the Labour party—promised to renegotiate our terms of entry and to have a subsequent referendum. During those renegotiations, not a word was mentioned about fishing policy. A referendum was held, during which time those concerned about the impact of our membership on UK fisheries undoubtedly put forward their views. But the country decided, by a clear and convincing majority, that it wanted to say yes to Europe.
For Britain to exit from the common fisheries policy would require the unanimous agreement of all our Community colleagues to the necessary treaty changes—and they would have to be complex changes. Simply disapplying the fisheries provisions of the treaty would not be sufficient to exclude the UK fishing industry from the impact of general provisions of the treaty such as the requirements of non-discrimination and free movement—the sort of requirements that caught us in the Factortame judgment. The complex range of changes that would be necessary would all require unanimous agreement.
We obtained a pretty good deal when quota shares and restrictions on access to areas such as the Shetland box and coastal waters were decided. It is politically unrealistic to imagine that a new deal can be done that will result in other countries in the European Union giving away fishing opportunities to the United Kingdom. It is disingenuous for any of us seriously to suggest that this or any other United Kingdom Government would unilaterally seek to exit from a key policy of the European Union.
Even if we sought and secured such agreement, what would have been achieved? I or any future Fisheries Minister would have to spend almost an entire Parliament negotiating new arrangements with the European Union to meet not just our needs but the historic interests of our neighbours such as Ireland, France, Belgium and the Netherlands on subjects such as access and enforcement. We would still have to agree internationally to total allowable catches for fish stocks that straddle the areas within different fishery limits and we would still have to have a system of matching UK effort to available stocks.
In my attempts to be the best advocate for the fishing industry I have a duty to listen carefully to what the industry has to say. Like any good advocate, I also have a duty to tell the industry the facts as I see them. Suggestions that we could unilaterally abandon the CFP are not within the politics of the possible; they are a distraction.
Sir Richard Body: Will my hon. Friend give way?
Mr. Baldry: I am sorry, but I do not have time to give way.
Moreover, such suggestions do not tackle the key problems facing the industry—balancing the need to
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maximise today's catch and the need to ensure sustainable levels of fish stocks to guarantee healthy catches next year and in subsequent years. We have to face up to not fear of foreigners but the straightforward fact that far too many fish stocks around the United Kingdom are seriously depleted or at a critical level. Of the main stocks in the waters that we fish, just over 40 per cent. are considered secure; the remainder are at risk of biological collapse, which means that they could not be fished economically—which is what happened to the cod of Canada. Nearer to home, that is what happened in the 1970s to herring and mackerel in the North sea.
It is important to pause to reflect carefully on why fish stocks are under such pressure. It is always tempting to try to blame someone, but the reality is more complex. If we do not make the effort to understand the reality, we will make an oversimplified diagnosis and seek the wrong solutions.
It is important to understand the role of fisheries science. It is a biological fact that the success rate of each year's spawning can vary massively. A mature female cod may yield 10 million eggs—their survival rate is tiny, as many are preyed on by other or the same species before they mature. Many factors influence the survival rate, including salinity, sea temperature and weather. As a result, in some years the survival rate can be much higher than the average. The peak years, when the so-called recruitment is good, constitute one reason why the scientists may advise that catches can be increased even against a background of poor stocks. That is why, against a general trend, the scientific advice is that we could catch more North sea cod next year. There has been one year of exceptional recruitment in that stock.
A salutary example of fishery science is provided by the Canadian experience. It is now generally accepted that one of the mistakes made in cod fisheries management was in placing too much reliance on the evidence of successful commercial fishermen. The scientific evidence showed that catching rates of research vessels were declining, but at the same time commercial catching rates were sustained at a reasonable level. Fishing was allowed to continue at too high a level and, ultimately, the stocks collapsed and the fishery was closed. With the benefit of hindsight, the commercial fishermen seem to have been successful because they were tracking down the limited numbers of remaining stocks.
The lesson is that fisheries management is difficult and is not an exact science. There is no answer that we can be sure is correct at any one time, but if we want to avoid disasters we must be ready to implement sensible and balanced precautions that may sometimes mean that fishermen are able to say after the event that we were too cautious. It is certainly misleading to pretend that the problems have nothing to do with our fishermen's activities, or that they are the fault of the Spanish when they have no access to fish stocks in the North sea or the Irish sea.
In the short time available to me, I hope that I have explained why I believe that it is disingenuous to suggest that departure from the CFP is the solution to all our problems. In subsequent debates between now and Christmas, I hope to respond to the House on the other points that were raised today—not least on how I believe that we may reform the CFP in the best interests of the United Kingdom fishing industry.

Water Supply (West Yorkshire)
11 am
Mrs. Alice Mahon: There is a great deal of interest in this subject—as we can see from the number of hon. Members who are present in the Chamber for the debate. I know that my hon. Friends the Members for Normanton (Mr. O'Brien) and for Barnsley, Central (Mr. Illsley) wished to be present for the debate, but they are meeting the Secretary of State for the Environment on another issue.
I requested a debate on the crisis facing the people of West Yorkshire months ago when the privatised Yorkshire Water company first proposed standpipes and later sought Government approval to implement 24-hour rota cuts. I can tell the House about the level of anger in Halifax and in other affected areas about the actions of Yorkshire Water. The public anger is unprecedented: I have not seen the like of it since the introduction of the poll tax.
People detest the way in which Yorkshire Water has conducted its business and the way in which it has blamed its customers for the current crisis. Customers are lectured time and again, as if the present situation has nothing to do with the company. This week the Government have been asked to give Yorkshire Water the authority to impose rota cuts and I ask the Minister not to give that permission. In my speech, I shall outline the implications for both my constituents and the local economy if permission were granted and the cuts went ahead.
My position on the issue of rota cuts is absolutely clear, and I believe that is shared by hon. Members on both sides of the House. I believe that the consequences of the 24-hour rota cuts would be so severe as to make the idea completely unacceptable. Whatever it takes and whatever it costs, the water must continue to come out of customers' taps. I think that the Government have a clear duty to ensure that that occurs.
I shall now turn to the record of Yorkshire Water since privatisation, as its abysmal mismanagement of that vital industry has led to the current crisis. We have lived through an exceptional drought; no one denies that. However, last winter was one of the wettest on record and in early spring our reservoirs were full.
Mr. David Hinchliffe: Does my hon. Friend agree that one of the most obvious causes of concern in Yorkshire is the ludicrous mismanagement of the industry by Yorkshire Water? Throughout the summer, in Calderdale and in nearby Kirklees Yorkshire Water threatened complete cut-offs, while in the immediately adjacent areas of Wakefield and Leeds people were allowed to use hosepipes until a month ago. Does my hon. Friend accept that Yorkshire Water's biggest failure is that it has not yet established the most basic, commonsense elements of the grid system? Will she press the Minister on that issue to ensure that the Government introduce a grid system, as that is surely the answer to Yorkshire's present problems?
Mrs. Mahon: My hon. Friend's comments have exposed the inadequacy of Yorkshire Water's management of the industry. I fully support his comments and I hope that the Minister will take them on board.
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Upon privatisation, the water industry benefited from a debt write-off of £5 billion, a green dowry of £1.5 billion and a share underpricing of £873 million—in fact, there was the usual privatisation fix to assist the Government's friends in the City. Since privatisation, the bills to customers have increased by more than twice the rate of inflation. The people having to meet those exorbitant increases have paid for improved standards of quality that were imposed by the European Union and not by the shareholders or by the bosses of Yorkshire Water, who have simply filled their pockets. In June this year Yorkshire Water announced record profits of £161 million. Only £11 million was set aside for the repair of leaks, while the company chairman, Sir Gordon Jones, gave himself a 169 per cent. increase on his salary of £190,000.
Yorkshire Water also borrowed £50 million. However, it spent the money not on its core industry, but on speculative business ventures in China and in Europe. If some of that money had been spent on leaks and on maintenance, we might not be facing the current crisis. Months ago my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) produced the figures to show that Yorkshire Water is top of the national league for wasting water supplies. Some 103 million gallons—or one third of the total supply—is lost every day through leakage. That is an absolutely disgraceful record.
Mr. Barry Sheerman: I agree with everything that my hon. Friend has said—especially as I suffer the double whammy of living in Halifax while representing Huddersfield. Do not the Government also have a responsibility for the current situation? They knew that there had been a hosepipe ban in Yorkshire for five out of seven years and that if there was a drought, there would be trouble. Where was the Government's strategic long-term view? Throughout the summer Ministers simply ran around like headless chickens trying to make it appear as though they were doing something constructive.
Mrs. Mahon: My hon. Friend makes his point very well. Since privatisation in 1992, Yorkshire Water's investment in repair and maintenance has fallen by £44.8 million-26 per cent—while demand has increased. As my hon. Friend said, that information was available to the Government but they failed to act upon it.
I have also discovered that the company does not employ people from the Halifax area to repair bursts or to make new connections: there is no direct labour force. The work is "outsourced"—that is privatisation-speak—or contracted out to small contractors such as O'Donnells of Bradford on a strictly cash-limited budget. Prior to the crisis, all repair work on leaks was stopped unless a major burst occurred. In my village of Northowram, water was allowed to cascade down a steep hill for months and repairs were not made until the conditions became so dangerous that one could almost skate on the resulting ice. I understand that Kirklees and Bradford also operate with no direct work force.
Yorkshire Water has a leakage detection team that marks were leaks occur so that private firms can repair them. But sometimes repair work is not undertaken for weeks or months—if at all. Those private firms are not accountable to anyone, as Yorkshire Water is more interested in making money than in repairing leaks. I have also been informed that it had planned to implement a scheme called Operation 2000 in October, which would

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have abolished the leakage detection teams altogether. However, because of the present outcry, its abolition has been put back to January 1996. Will the Minister inform us about that proposed abolition?
Night-time waste detection teams were disbanded two years ago and Yorkshire Water now accepts that 25 per cent. is an acceptable level of leakage. Headwork teams, comprising men who dig conduits to channel water into the reservoirs and keep the silt out, have been steadily disbanded. Water is allowed to form bogs and small lakes around the reservoirs instead of being channelled into them. Silt continues to filter into the reservoirs. I have visited the reservoirs with experts, and in some areas we have seen silt up to 100 ft deep. Had that silt been cleaned out, there would have been greater capacity and, therefore, more water.
Since privatisation, the reservoir keeper has become responsible for more reservoirs, but he does not have the same number of workers as before. Two years ago, Yorkshire Water seriously considered replacing its dwindling band of skilled water workers with Securicor. Can Members imagine anything more ludicrous? That is the level of neglect that privatised industry has imposed on a vital, life-giving resource.
When the current crisis is over, Yorkshire Water's greedy and incompetent managers should be exposed to detailed public scrutiny. Never again should they be allowed to bring the health and well-being of the people and the economy of West Yorkshire to the brink of disaster. We all know that they ptit profit before service and that will not do. They are not fit to be in charge and those responsible must go.
I turn now to the people who will be affected by 24-hour cuts. Since the beginning of the crisis I have received many representations from the public, industry, local businesses, schools, national health service professionals, nursing homes, council offices, the fire service, charities, local pensioner groups and many others.
Mid Yorkshire chamber of commerce said last week in its objection to the tribunal considering the application for the emergency drought order:
"The major effect that rota cuts will have is the considerable disruption to production flow. All firms have contracts which must be met and loss of production for 24 hour periods will severely hinder a firm's ability to meet deadlines.".
It also wrote to me saying:
"At no time during the development of the drought did Yorkshire Water contact the Chamber. It was the Chamber which contacted Yorkshire Water at the beginning of September to ask for hard information and offered to assist in bringing about awareness through its membership of around 2,500 firms from industry and business."
It had to take the initiative.
The West Yorkshire fire service objected to the drought order through the local evening paper, the Halifax Evening Courier, which, along with other media, including the Yorkshire Post and Radio Leeds, has sustained an excellent campaign throughout the crisis and kept the public informed. The local authority's chief fire officer said:
"Fire fighting in Calderdale would be seriously compromised if rota cuts go ahead."
Mr. Jim Manuel, West Yorkshire's most senior fire officer, told the drought hearing:
"'A fire in a large multi-storey building, we would be incapable of controlling under those circumstances.'
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Yorkshire Water had said they could turn the mains back on within one or two hours, said Mr. Manuel. 'I think that would be largely academic'."
That is an example of Yorkshire Water's response. Old mill buildings, which are common in West Yorkshire, could present a serious hazard.
Holdsworth and Company is a local textiles firm that has tried its best to conserve water. I took my hon. Friend the Member for Holborn and St. Pancras to visit that reputable local firm. Holdsworth and Company warned that if it had to close and fell behind with production, vital exports could be lost and once lost could be gone for ever.
The Confederation of British Wool Textiles said that if water cuts became fully operational, there might be lay-offs of up to 3,000 people in Calderdale and Kirklees.
The Royal Society for the Protection of Birds wrote me a very witty letter saying that if the crisis were not so serious, it
"could have been taken from a Gilbert and Sullivan comic opera.
We have the tankers commandeered from chocolate makers and chemical companies to fill up in Northumbrian reservoirs."
More seriously, it said:
"We have the rivers Wharfe and Ouse being drained—placing fish, birds and other wildlife in jeopardy. This is a prime example of the environment paying the price for poor management of water resources."
I could not agree more.
Guy Cocker of the local dental services committee told the inquiry:
"Dentists operate on living tissue and as any surgeon have to scrub wash their hands between each patient. It would be difficult to see how this could be done if water is not of the highest quality and free of bacterial infestation. It may well be that General Dentist Practitioners have to close their surgeries."
Calderdale Nursing Homes Association felt the same as nursing homes were not exempt, as hospitals and police stations were. It said:
"We care for most vulnerable and frail members of society. Many are very ill, doubly incontinent and unable to resist infection. Lives will be at risk without an adequate water supply."
Recognising the severity of the crisis, I wrote to the Prime Minister on 17 August asking Parliament to intervene and for the Government to recall Parliament. I received only a holding letter. I wrote again on 18 September and on 22 September drawing attention to lead articles in the Evening Courier and the Yorkshire Post. I sent the Prime Minister all the information. I also wrote to the Secretary of State for Health and the Secretary of State for the Environment.
I finally received a reply from the Prime Minister on 26 September. What a disappointment it was after waiting almost six weeks. He said:
"The five months April to August were the driest five months for over 200 years. It is unrealistic for water companies to plan, invest and increase charges to customers to cater for all demands through such a rare event."
I do not agree. Water companies have responsibilities.
Mr. Gerry Sutcliffe: Was not that disappointing response from the Prime Minister compounded by the response from the Secretary of State for the Environment in the summer, when he told people to stop whingeing and enjoy the weather? He did not care about the people of West Yorkshire.
Mrs. Mahon: That was the usual insult from the Secretary of State for the Environment instead of a helpful suggestion. The Prime Minister's letter continued:
"I understand that although reservoirs which supply Bradford and Halifax areas were at full capacity at the beginning of the summer season, they did not have the usual topping-up from run-off due to the exceptionally dry weather since April.
Overall the privatisation of the water industry has been an outstanding success.".
It did not matter to him what my constituents felt.
Last winter was one of the wettest on record. I would have found the Prime Minister's comments about the exceptionally dry weather farcical were we not facing such a serious crisis. What does he think happens in Australia, Saudi Arabia and Kuwait? People plan ahead.
Last week, the right hon. Gentleman compounded farce with insult when he replied to my intervention during the debate on the Queen's Speech by saying:
"In addition to everything else, the Opposition have a policy to make it rain when it is convenient."—[Official Report, 15 November 1995; Vol. 267, c. 27.]
Mr. John Gunnell: Does my hon. Friend agree that Yorkshire Water's planning has consisted of closing reservoirs and seeking planning permission to build on those sites?
Mrs. Mahon: That is well documented and well known to people in West Yorkshire.
The Minister for Local Government, Housing and Urban Regeneration insisted that the Government could not intervene, yet they do in other matters. In response to a request from my hon. Friend the Member for Huddersfield (Mr. Sheerman) for the Army to be brought in, he said that help in distributing water by the military was impossible because the Army water tankers were busy in Bosnia. He was not concerned about the people of West Yorkshire.
The tankers have come to the rescue, but do Members have any idea of the disruption to the lives of people living round the Albert reservoir in Halifax? I took my hon. Friend the Member for Holborn and St. Pancras to see it. Yorkshire Water is paying compensation to people who live nearby.
Mrs. Helen Jackson: Is it not the case that the whole tankering operation is moving 13.5 million gallons a day while 100 million gallons a day are leaking away? Could not the whole crisis have been avoided?
Mrs. Mahon: Such a test could have been set in a primary school. There are 250 tankers a day operating in Calderdale, and that figure will increase to 600 as other parts of West Yorkshire are hit by the drought. The constant noise and pollution caused by those lorries as they drive past every day are seriously disrupting people's lives.
I pay tribute to the three local councils involved and particularly to Calderdale's leader, Councillor Pam Warhurst, Councillor Paul Wyatt, who lives in the area where the tankering is in operation, chief executive Michael Ellison and Mr. Paul Steed, principal planning officer, who have all planned for the crisis. While the Prime Minister and Whitehall completely ignored the growing crisis, others were trying to do something. I wonder whether the Prime Minister would have ignored
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me for six weeks if the affected area had been Huntingdon or the home counties. In no way is the north-south divide better illustrated.
The council has already delivered 1 million litres of bottled water to schools and nursing homes, at the cost of a great deal of time and money. I hope that it will be fully recompensed. When the inquiry opened last week in Dewsbury, Yorkshire Water announced a £2 million compensation package for customers who might be hit by the cut-offs—£2 per week for each property and £15 every fortnight for the inconvenience. There will be nothing for industry, and that is not good enough. One cannot put a price on people's health or jobs.
Why did not Yorkshire Water have a long-term strategy or listen to Diana Scott, who was doing such a superb job of warning of all the folly and neglect? She was doing her job properly, but got sacked for it. Where has Ian Byatt been until recently? Why is that man paid all the money that he is? The Government have washed their hands of 600,000 people in West Yorkshire.
Yorkshire Water's long-term strategy has been to pray for rain. The way that it has insulted customers is diabolical. It makes a mockery of the term privatised business when Yorkshire Water has spent months exhorting customers not to use its product.
The tankering operation is costing £3 million a week. Imagine if that money had been spent earlier on repairs and a decent strategy. Why do the Government think that the crisis is not of their doing, when they are the guilty men and women who handed over a precious asset to a private company? The Minister said that Army tankers are not available, but that is not good enough. Pipelines can be installed in days when there is a war—we saw the most amazing logistics and operations during the Falklands and Gulf wars. Why is it thought that the people of West Yorkshire are less important than the people of Kuwait or of the Falkland Islands? Yorkshire Water did no planning until it looked into the abyss and saw the future—and only then because the company realised that cut-offs could cause it to go bankrupt.
I call on the Government to take over Yorkshire Water and to promise that customers will not have to pay for the company's folly. I ask the Government to put every resource necessary into ensuring that the people of Calderdale and Kirklees will not have their water cut off and to refuse any request to do that. There must be a full and frank public inquiry into why almost 600,000 people have had to experience threats and intimidation from a company in a first-world country, and who may now have to face the kind of hardships that confront people in third-world countries. It is time for Yorkshire Water to go and for the Government to take on the company's responsibilities.
11.23 am
Mr. Graham Riddick: It is important to debate this subject this morning. I also submitted an application for an Adjournment debate this week, and I congratulate the hon. Member for Halifax (Mrs. Mahon) on her success in the ballot. In recent months, this issue has not been wholly party political, which is a good thing. All Members of Parliament for Yorkshire have united in urging Yorkshire Water to take whatever steps are necessary, which is a positive aspect of the affair.

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I regret that the hon. Lady has made the issue party political with her speech this morning. The crisis would be taking place whether the water industry was in the private or the public sector. I have press cuttings from 1976, when Labour was in government, reporting on standpipes going up in Holmfirth. People in my constituency were being threatened with cut-offs at that time.
It is only fair to acknowledge the significant shortage of rain in recent months. I am not for a moment apologising for Yorkshire Water, and I will say some rough things about it in a moment. I was interested to note that one of the 1976 press cuttings reported that water charges might increase by 25 per cent. the following year to pay for combating the crisis. Now that the industry is in the private sector, I expect to see the company's shareholders—not its customers—pay for the measures that Yorkshire Water has had to take.
If Yorkshire Water had been in the public sector, I have no doubt that Labour would be saying that the crisis was all the Government's fault because they had not invested sufficiently in the water infrastructure. If Labour had been in government, Conservative Members would probably have said exactly the same. As the industry is in the private sector, we can stand back and be rather more objective than might otherwise have been the case.
Mr. Terry Rooney: It may surprise the hon. Gentleman to learn that, in 1976, I would have been one of his constituents, so I know what he is talking about. Is the hon. Gentleman aware that in 1976, Yorkshire Water—free of any payment or levy—was able to take water from the North West, Northumberland and Severn Trent utilities? Today, the company must buy that water. That is the difference.
Mr. Riddick: Yorkshire Water is taking as much water as it can from Northumberland and the north-east now, so nothing has changed.
We can all agree that Yorkshire Water's customers among our constituents should be asked to save water. Despite the company's statement on Monday that there will be no need to introduce rota cuts before the new year, we are not yet out of the woods. It is important that the public continue to save water wherever they can. I know that my constituents are doing that, and I am sure that people throughout West Yorkshire are doing so. That should continue.
I believe, like the hon. Member for Halifax, that it is wholly intolerable in this day and age that my constituents should be faced with the possibility of having their water supply cut off 24 hours at a time. That is an appalling prospect for domestic householders and it would create extreme difficulties for pensioners, who rely in most cases on central heating to keep warm, and for parents of young families. It would also be disastrous for industry.
The textile industry became established in West Yorkshire mainly because of the ready and plentiful supply of water. The Confederation of British Wool Textiles estimates that 3,000 workers in the industry would have to be laid off if rota cuts became fully operational throughout Kirklees and Calderdale. There are a total of 50,000 jobs in Kirklees in manufacturing, textiles, engineering, chemicals and food production—all of which are major water users. If rota cuts were introduced, thousands of local people would be laid off,
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which would be wholly unacceptable, and many small companies would go out of business. Water cut-offs would be a real shocker for the local economy, and they must not be allowed to occur. Their effects on the ability of fire fighters to do their job would be disastrous, and hospitals, dentists, old people's homes and schools would also be seriously affected.
The hon. Member for Halifax was not the only person to express her concern early on. In August, before the problem became really serious and only four months into the drought, I said that this year's problem showed a lack of sufficient storage capacity. In his chairman's statement of 1990, the chairman of Yorkshire Water plc said:
"During the year we faced another challenge as Yorkshire experienced one of its worst droughts this century."
In the Huddersfield Daily Examiner of September 1994, Yorkshire Water's general manager in charge of water supply was quoted as saying:
"In the exceptional circumstances of a very dry summer and an unprecedented high demand we had no option except to take the steps we did",
which were applying for drought orders.
Clearly there is a continuing problem. The fact that we have had hosepipe bans in five of the past seven years is confirmation of that. West Yorkshire has insufficient storage capacity for water. Yorkshire Water has complained about increasing demand on the part of customers. Most companies welcome increased demand from their customers, and Yorkshire Water should have been prepared for it. As industry emerged from the recession, it was only natural to expect companies to use more water. As householders' living standards rose, so consumption of water was also likely to increase. People buy dishwashers, which use a lot of water; they buy second-hand cars, which they want to wash. People also want to water their gardens, especially in hot, dry summers. Yorkshire Water should be in a position to respond to customers' increased demands.
I have no doubt that the company is fully aware of the seriousness of the situation and recognises that rota cuts would be wholly intolerable. I am also convinced that the Minister is fully aware of how serious matters are. I was delighted that he came up to West Yorkshire last week—I was pleased to see him even if the hon. Lady was not. We had a useful meeting in Brighouse, and he was able to see for himself the tankering operation at Scammonden. Judging by his comments, privately to us and also in public, he is clearly aware of the serious nature of the problems.
I would urge the Minister not to grant the drought order to Yorkshire Water. If he does not, the company will have to take whatever steps are necessary to maintain the water supply. At this point I will read an extract from a letter I have received from one of my constituents, who takes a hard line on this matter with which I fully agree. He is a solicitor working in Huddersfield and he writes as follows:
"If privatisation means anything it means that the supplier of the utility concerned must pay for its acts and defaults. If the order is not made and Yorkshire Water is unable to supply the people of Kirklees and Calderdale, the people of Kirklees and Calderdale will sue Yorkshire Water, which will be liable in damages. If by reason of that Yorkshire Water becomes insolvent, so be it. Yorkshire Water will be placed in liquidation, its assets sold to another undertaking and the proceeds of the sale will be available to satisfy the claims for damages from the citizens of Kirklees and Calderdale."

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I agree with my constituent, but I do not agree with the hon. Member for Halifax, who wants to allow civil servants to handle the crisis—that is not the answer. It seemed to be her solution, for she called on the Government to take over Yorkshire Water.
Back in August, I raised the issue of bringing in supplies of water from the Kielder reservoir. There is some confusion about this, but I believe there is scope to increase the supply from that source, and Yorkshire Water will need to examine that option both for the immediate future and for the longer term.
Another point about 24-hour rota cuts is that, in practice, many people will fill up their baths and basins with water in advance, and may thereby use more water than they would have without the cuts.
Mrs. Helen Jackson: Does the hon. Gentleman agree that if there had been a connecting grid between the Kielder reservoir and the Yorkshire and Humberside area, this crisis would not have occurred?
Mr. Riddick: Yes. I have talked to Yorkshire Water about that. The fact is that the company can get water from the Kielder reservoir into the Tyne and the Tees; it needs to build a pipe about 10 miles long from the Tees to the Swale, and thence to the Ouse so as to pipe it through to Leeds. Currently 90,000 tonnes of water are being transferred from the Ouse to the Leeds grid. A senior manager of Yorkshire Water told me yesterday that the company is looking for massive pumps to increase the rate of flow from the Ouse.
Once the immediate crisis has been overcome, Yorkshire Water must invest in a grid to ensure that water can be transferred between various parts of the county, and bring in water from outside the county when necessary. Water storage capacity needs to be increased to meet the demands of an increasingly prosperous society. That can probably be done by a combination of increasing yield from ground waters and industrial rivers, and possibly from new reservoirs and outside sources such as Kielder. Leaks should also be reduced in the short term, and Yorkshire Water must do whatever is necessary to maintain supplies.
The Government must not, however, grant the drought order because rota cuts would be wholly unacceptable in this day and age.
11.36 am
Mr. Terry Rooney: I found some of the comments that we have just heard amazing. I wonder where the hon. Member for Colne Valley (Mr. Riddick) has been throughout this episode.
In the first week of August we in Bradford were told that, unless there was significant rainfall by the end of August, we would have standpipes. That idea fell by the wayside, though not because of rain. At the beginning of September we were told that, instead of standpipes, we were to have alternate 24-hour rota cuts. That resulted in an application for a drought order to the Secretary of State for the Environment, and a public inquiry was set up. For some reason, the application was withdrawn at the last minute and the public inquiry was cancelled. In the meantime, we have not had much rain.
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Another difficulty lies with the statistics supplied by Yorkshire Water. If we calculate average daily use, the amount of water brought in by tanker and the amount of rainfall that we have had, the sums do not add up. I suspect that, all along, supplies in West Yorkshire have been between 10 and 15 per cent. higher than Yorkshire Water has admitted; otherwise Calderdale would have run out of water five weeks ago.
It seems that Yorkshire Water has no conception of what rota cuts would do to the economy. Their effects on householders and schools are obvious. Of the top 50 overseas-earnings companies in Yorkshire and Humberside, 13 are in Bradford, representing £1 billion of exports and 20,000 jobs. These companies are being told to shut down every other day. Let us consider companies operating in the food chain. They are being told to boil the water that they use on alternate days. Sunblest bakery is located in my constituency; it uses 500,000 gallons a day, making an awful lot of bread. The director asked me how he was supposed to boil that much water before using it. That bakery will be short until the rota cuts have finished. If they continue, every school kitchen will have to close, and every supermarket and small business will be at risk. Yorkshire Water has no conception of what has been going on.
Mr. Sutcliffe: Yorkshire Water wrote to the affected companies asking why they did not relocate during the crisis.
Mr. Rooney: That would be all very well if they could relocate in the Amazon rain forest.
Yorkshire Water has claimed that the problem lies with consumption and supply, but in fact it is a problem of distribution. Throughout the summer months—even according to Yorkshire Water's polluted figures—supply in the area did not fall below 45 per cent. The whole system is geared to a water supply in the Pennine areas, and pumping stations to pump it into the east; there is no facility for pumping it back. As a result, the east of the county was flooded with water while there was a shortage in the west.
In the first week of September, when Bradford was faced with the prospect of 24-hour cuts, Yorkshire Water was taking tankers to the racehorse trainers' gallops at Middleham and Malton—free of charge—and spraying water all over the place. The racehorses had to be protected, but the people of Bradford could have their water cut off every other day; that was fine. Meanwhile, hundreds of thousands of gallons were being delivered every day, free of charge. That is nonsensical.
Those who know the geography of the area will be aware that Bradford and Leeds are next to each other. In September, when the discussions were in progress, it was suggested that a pipe should be installed connecting the distribution system covering the area between Leeds and Sheffield with that of Bradford. The local authority offered manpower, and even offered to contribute to the cost, but Yorkshire Water would not entertain the idea, which would have obviated any need for rota cuts.
Since July, when Mr. Newton made his infamous claim not to have had a bath for three months—which turned out to be about as truthful as his supply statistics—Yorkshire Water appears to have been run by a public relations gentleman called Steve Painter. At the end of the day, Mr. Painter is a messenger boy, albeit a very good

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one. Unfortunately, like most messenger boys, he does not understand the message that he is conveying. The public are fed to the back teeth with being told that it is all their fault; they are fed up with being treated like idiots. It is time that Yorkshire Water put those who are in charge of the system up front, rather than the public relations people. It is time that it gave the public confidence in the water supply.
Towards the end of September, when Bradford was still under the threat of 24-hour rota cuts, an appalling fact came to light. Yorkshire Water had signed up to 61 commercial deals with Bradford companies, involving supplying them with water from Selby: they would have to pay for transport, but not for the water. No nursing home or person with a home dialysis machine could have a water supply, but a commercial concern that was willing to pay could have one. That sums up the difference between 1976 and 1995.
11.43 am
Mrs. Elizabeth Peacock: I welcome the opportunity to speak about Yorkshire Water, and congratulate the hon. Member for Halifax (Mrs. Mahon) on obtaining the debate. I shall express my views on behalf of 77,500 constituents and their families; I also spoke on their behalf on Friday, when I attended a public inquiry.
It is a matter of public record that Yorkshire Water has spent millions of pounds on infrastructure. It has certainly spent a good deal in my constituency. Indeed, it has spent more than has been spent for centuries. Much more needs to be spent, however, particularly on leakage control. It is nonsensical that so much water is being lost every day when it is becoming such a precious commodity. I believe that every consumer in the Yorkshire Water area should benefit from water supplies at home and in hospitals, schools and businesses.
The situation is serious, and it should have been anticipated. We have not had the rain that we should have had. Certainly, neither my hon. Friend the Minister nor Yorkshire Water can make it rain—if they have tried, they have been using the wrong rain dance man—but Yorkshire Water should have started planning for the worst possible scenario early in the summer. If it had taken action at different stages, putting its plan into operation, we should not now be discussing the possibility of rota cuts.
Of course we must all save water: everyone has a responsibility to do that. I wonder, however, whether Yorkshire Water—or, perhaps, my hon. Friend the Minister—can tell me who owns the water that is in the full reservoirs at Whitley and Addingham, which I understand to be fairly full, and why it is not available in my part of Yorkshire.
It was not at all helpful of the managing director of Yorkshire Water to say on television that he had not had a bath for three months. When the media asked me to comment, I said that I would hate to sit next to him on a bus. We have spent years taking people out of houses that had no proper facilities such as running water, but now there is a possibility that we will allow Yorkshire Water to cut off the supply that we spent so much money and time installing. People in Batley and Spen want water—they are not too worried about compensation—and they want it delivered through their pipes rather than in bottles.
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There is no shortage of water in the surrounding areas. It is absurd to say that there is a drought. It seems that everywhere in the country except our bit of Yorkshire has water; why cannot some of it be piped to us? What is Yorkshire Water doing about this?
Yorkshire Water has been running more than 200 tankers, and the number is to rise to 600. That is fine, but anyone driving up the M62 at any time of day or night will follow a constant stream of tankers. When they enter urban areas, people's lives become impossible: it is as if a rolling tank regiment were passing their doors continuously, day and night. Many people are being made ill; they and their children cannot sleep. Yorkshire Water must take the problem seriously. The tankers bring their own pollution, along with traffic congestion and noise.
Why can we not have a temporary pipeline? I am sick and tired of everyone telling me over the past few months what cannot be done; I want to hear what can be done. If our Army engineers were here, they might be able to install a temporary pipeline, but they are all in Bosnia. I believe that we in West Yorkshire are just as important as those who are suffering in Bosnia.
I am told that it would take between six and nine months to install a pipeline. Why? We sent our Army into disaster areas to lay pipes in difficult conditions and in a very short time. If all else fails, why do we not get Anneka Rice? She can do almost anything in 48 hours. Perhaps we should talk to her—or perhaps Yorkshire Water should do so.
We are told that we have part of a pipeline that goes from Kielder all the way down to Teesside, and I understand that there is a gap of about six and a half miles. If that gap were filled, the supply could be brought to Swaledale; once it arrived at Swaledale and the Ouse, we could all have water.
Mr. Jack Thompson: As the hon. Lady knows, my constituency is not in Yorkshire but in Northumberland. I was very much involved in the development of the Kielder reservoir when I was a member of the water authority. Given her political beliefs and her faith in the free market, does the hon. Lady recognise that my constituents who are shareholders in Northumbrian Water will benefit, receiving an increased dividend? Some good is coming from the exercise, in Northumberland if not in Yorkshire.
Mrs. Peacock: The hon. Gentleman is correct; if someone has a commodity and someone else wants it, it has to be bought, and that is what Yorkshire Water will have to do. If that benefits shareholders in the hon. Gentleman's area, good luck to them. Yorkshire Water shareholders might not benefit so much, because I believe that they should foot the bill for whatever it takes to supply water to my constituency.
We have householders, many of whom are elderly, and we have schools, nursing homes, hospitals and local businesses. I am sure that the Minister has heard a lot from local businesses recently. In my constituency, Fox's Biscuits employs 2,200 people, and it could not make biscuits or enforce hygiene in the factory without water.
Earlier this week Nigel Worne, Fox's Biscuits managing director, said:
"We are the biggest private employer in Kirklees and Calderdale with 2,200 staff and the implications of having no water are enormous. Cutting it off for 24 hours at a time would be even worse because Yorkshire Water couldn't guarantee constant purity. We use 44,000 gallons of water a day."

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Of course Fox's Biscuits uses that much water; its biscuits are sold internationally—indeed, all over the world—as well as in all the best stores in the United Kingdom. Furthermore, the company employs many people in my constituency, and I want that to continue.
I have had a great deal of contact with our textile companies, through the Confederation of British Wool Textiles. John Whitfield, of Thomas Carr Ltd., another large employer in my constituency, described the application for rota cuts as "a short-term, ill-considered decision" that would have "a long-term devastating effect" on local industry. Talking about three or four firms that provide another 1,000 jobs, he said:
"Closure of our firms will have an immediate knock-on effect on employment on both our raw material suppliers and carpet-producing customers."
Thomas Carr Ltd. is another firm that sends 50 per cent. of its goods for export, and this is its busiest time of the year. If it does not complete its orders, it will lose not only those but future orders, because its customers will go elsewhere to buy.
As we have already heard, earlier in the summer Yorkshire Water suggested that some of the affected companies should relocate. What arrogant nonsense. What right has Yorkshire Water to tell companies in my constituency, or anywhere else in Yorkshire, to relocate? In my constituency alone there has been millions of pounds worth of investment over the past 10 years. It is downright arrogance to say, "Sorry, we can't let you have water. Would you mind gathering up your factory and taking it 10 miles up the road?" In fact, it is disgraceful.
I urge the Minister to ensure that, if necessary, the Government will lift planning restrictions so that a temporary pipeline can be laid. I have discussed the matter several times with my hon. Friend, and I know that he is sympathetic to what we are saying. If that is the way to get water into the area, so be it—and I understand that it is now being discussed.
May I also have the Minister's assurance that the recent public inquiry will not necessarily lead to rota cuts? Last week, the general view of the media in Yorkshire was that the inquiry was merely an exercise, that rota cuts were already on the cards and that the public inquiry was little more than a waste of time. Will my hon. Friend assure my constituents and me that that is not so, and that he will ensure that every possible source of water, however expensive it may be, is explored by Yorkshire Water, so that our householders, consumers and businesses can continue their activities over the next few weeks, when clearly things will be difficult?
I repeat that there is plenty of water around. Yorkshire Water must go out and buy it and get it into our areas, perhaps by using a pipeline.
11.53 am
Mr. Max Madden: Earlier this month, a constituent of mine wrote to my hon. Friend the Member for Halifax (Mrs. Mahon) saying:
"I write, as a disillusioned Tory, to thank you most sincerely for forcing Parliament to debate the serious mismanagement of collection and distribution of water in the Yorkshire area … The
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blame should be laid fairly and squarely on the present government. There never has been a better case for having a National Water Grid serving a Nationalised Water Board".
I ask the Minister for three undertakings. First, I would like a clear assurance that the Government will require Yorkshire Water to take every possible action to avoid the interruption of water supplies in any part of Yorkshire in the foreseeable future.
Secondly, will the hon. Gentleman assure me that the Government will not agree to any further drought order? I also ask for clarification as to whether the granting of a drought order automatically exempts Yorkshire Water from paying reasonable compensation. That is a grey area, and the Minister should clarify it this morning.
Finally, I ask for a clear undertaking that the Government will authorise a wholly independent inquiry soon, to examine several matters, especially Yorkshire Water's investment programme for repairing leaks.
Mrs. Helen Jackson: Does my hon. Friend agree that the present proposal that such an inquiry be sponsored by Yorkshire Water is totally unsatisfactory? Is it not true that any inquiry must be completely and utterly independent of that company if it is to have any credibility for the people of Yorkshire?
Mr. Madden: I thoroughly agree. That is an absolute requirement. Moreover, there would be no confidence in any inquiry initiated by the water regulator, who is widely regarded as someone who would find it difficult to regulate his way out of a wet paper bag.
Such an inquiry should be able to investigate the ability to move water around within the region and between regions. It should also examine the closure of reservoirs that has taken place in Bradford and other parts of West Yorkshire—primarily, it would appear, to raise even more money for the shareholders of Yorkshire Water.
The inquiry should also examine the handling of the summer crisis, which, as the Minister has heard from both sides of the House, left much to be desired. Finally, it should inquire into Yorkshire Water's diversification into all sorts of business activities other than supplying water, not only in this country but around the world.
The most recent edition of Private Eye reports:
"Drought-stricken Yorkshire Water is using its newly-found customer relations skills to top up its profits. The company is holding a seminar for the PR industry on how to improve communication skills and handle the media. Appropriately the £35-a-head session ends with a lecture on 'crisis management'."
I cannot conceive of any organisation less fit to advise others on crisis management than Yorkshire Water.
I hope that in replying to this important debate, the prospect of which I suspect persuaded Yorkshire Water not to embark on rota cuts anywhere, the Minister will make it clear that he will not tolerate that company's interrupting water supplies anywhere else in Yorkshire. I also hope that he will respond to my request for undertakings.
11.57 am
Mr. Spencer Batiste: From what we heard earlier this week, it appears that because of recent rainfall, the immediate crisis has been postponed into the new year. However, no one knows what rain will come later this year, in the winter or even next summer, and the

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debate gives us an important opportunity to establish clearly what our priorities should be for the water industry in the future.
First and foremost, it must be clearly stated that water supply must be guaranteed, at whatever cost to the shareholders of any water company. Water must come to homes, schools, hospitals and businesses. Proposals to restrict the supply are unacceptable.
This is not a national crisis, because there is no national shortage of water. It is a local issue; water does not happen to have fallen in the places where the water companies traditionally predict that it will. The problem is therefore one involving the supply system rather than general drought conditions. It has been caused by the lack of a national grid and the lack of action to deal with leakage. These are the consequences of a century of under-investment in the water industry, and privatisation has for the first time brought large-scale investment into that industry. The problem we face is that, until now, investment has been focused on other important priorities such as improving water quality, dealing with sewage and improving the quality of rivers. Money has not been invested in the basic issue of guaranteeing the supply of water to consumers.
Weather patterns are very variable, and they are becoming increasingly unpredictable. We cannot rely on rain falling in the Pennines over the summer in a way that will guarantee water supplies to the homes that depend upon it, and Leeds is every bit as much at risk as Bradford, Halifax or any other area. We must ensure that a system is in place that will ensure water supplies to all, whatever the local conditions may be. Tankers are not the solution, as they cause havoc on the roads. Increased extraction from rivers has an enormous knock-on effect on wildlife, and we should be carefully monitoring that effect already.
Frankly, the priorities which have been established for the water industry need to be reassessed. Obviously, we want to improve the quality of our drinking water and the purity of water in our rivers, but first and foremost we must be able to deliver water to homes, schools, businesses and hospitals.
Mrs. Helen Jackson: Will the hon. Gentleman give way?
Mr. Batiste: I have only a short time, and I am sure that other hon. Members would like to speak. The hon. Lady has already intervened on two or three occasions.
Clearly, we need a grid system which will shift water from areas which have it to others which do not. Kielder in Northumberland may have water this year, but it may not next year, and Northumberland may be asking Yorkshire for water next year. A system must be in place that is able to provide that water.
Leakages must be addressed, and the neglect of the infrastructure in this century must be addressed quickly. Above all, it seems to me that Yorkshire Water is responding to the crisis in a way that is still reflective of a nationalised industry. The company is looking at the crisis on the basis of trying to control demand when it should be managing supply a great deal better. I hope the message that comes from this debate today is that, for hon. Members on both sides of the House, the people must come first and the supply of water must be guaranteed.
12.2 pm
Mr. Frank Dobson: I must start by congratulating my hon. Friend the Member for Halifax (Mrs. Mahon) on initiating this debate. More to the point, I should congratulate her on the campaign that she has waged against the shortcomings of Yorkshire Water and the way in which its incompetence continues to threaten the health and prosperity of people in Halifax, Calderdale, Bradford, Dewsbury, Huddersfield, Colne valley, Leeds and surrounding areas. Together with other Labour Members from Yorkshire, my hon. Friend has been relentless in speaking up for local people against the incompetence and profiteering of their privatised water company.
I should add my congratulations to those involved in newspapers, radio and television in Yorkshire, who have been stalwart campaigners on the matter. Despite the fact that they are run by a company that does not hide its light under a bushel—a company that is rightly described as Yorkshire Conservative newspapers—I should include in that my congratulations to the Yorkshire Post and the Yorkshire Evening Post on their campaigns.
No one who has followed this debate—or, more to the point, what has been happening this summer and autumn—could possibly doubt that Yorkshire Water is failing the people of Yorkshire. Equally, no one can doubt that Yorkshire Water is profiteering at the expense of its customers and the taxpayer. One needs only to look at the figures. Since Yorkshire Water was privatised in 1989–90, household bills have gone up by more than two thirds, or 68 per cent. Profits have more than doubled, and are up by 144 per cent. The pay and perks of company bosses have nearly quadrupled, and are up by 288 per cent. The market value of the company has more than doubled—it is up by 165 per cent. Nice work if you can get it.
The company and the Government claim that investment has increased. It did at the beginning, but it has tailed off. In any case, most of that investment was financed directly by the taxpayer. When the water industry was privatised, the Government handed over to the new private owners £6.5 billion of the taxpayer's money. Out of that bonanza at the taxpayer's expense, Yorkshire Water got £648 million. In the first five years of privatisation, Yorkshire Water invested £700 million in water supply. As I have explained, £648 million of that came from the taxpayer, leaving only £52 million—or 7 per cent.—to be met by the company from its £721 million profit.
Since privatisation, Yorkshire Water has paid no mainstream corporation tax at all. It has paid just £50 million in tax in total, and that is mainly in the form of advanced corporation tax, which the company can write off against its future tax liabilities. In short, Yorkshire Water—like the rest of the privatised water companies—is coining it at the expense of its customers and the taxpayer. But this summer's performance shows that Yorkshire Water is not just coining it; it is incompetent into the bargain.
The company's attitude to the drought has lurched from abject complacency to total panic. To be fair to Yorkshire Water, the Government's response has been the same. The Government—in the face of all of the evidence—have gone on proclaiming that water privatisation is a "brilliant success". They have blamed any problems that the industry has faced on the awful water company customers

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who insist on having water. They have taken every opportunity to promote their hidden agenda of forcing everyone in the country to install water meters, despite the £4 billion to £5 billion that it would cost the country.
In pursuit of that unholy grail of water metering, Ministers—either deliberately or in total ignorance—have misled the House, and claimed in plain words that the customers have wasted more water than the water companies. They have patronised and insulted Labour Members who have challenged those misleading statements. That was why I published the full figures on leakages on 3 August, and published them for the first time in a form that people could understand. Would you believe, Mr. Deputy Speaker, that the form in which the figures were published previously was in litres per household per day on the basis of a 20-hour day? That appears to be a covert effort to decimalise time.
The figures showed that the companies lost 826 million gallons of water a day, or 500,000 gallons a minute. Of the total water lost through leaks, 78 per cent. was leaked from company water pipes, leaving customers responsible for just 22 per cent.—precisely the reverse of what Ministers told the House. Yorkshire Water's record on leaks is the worst in the country. It wasted 103 million gallons a day from its own pipes. That accounts for 87 per cent. of the total leaked, while the careful customers of Yorkshire, as one would expect—I am a Yorkshireman myself—were responsible for leaking only 13 per cent. of the total.
The water that the company will lose from leaks today would meet all the water needs of Halifax and Calderdale for a fortnight. The water industry's response to the publication of the figures was to claim that we were exaggerating and that the companies were spending £4 billion on dealing with leaks. That simply was not true. I published the real figures, which showed that, far from investing £4 billion in dealing with leaks, the companies were investing about £66 million in identifying and dealing with leaks. Of that total, Yorkshire Water was investing £11 million.
The first response from the Government was a statement from the Secretary of State for the Environment, in which he said that he was very impressed with what the water companies had done. So were the people who were not getting any water. The right hon. Gentleman went on to say that we should all stop moaning, and that Labour's condemnation of the leaks was "hot air".
Ten days later, the Secretary of State published a document which, in line with the Government's hidden agenda, promoted the idea of domestic water metering, and refused to set targets for cutting leaks by water companies. He also claimed—extraordinarily—that he had taken new powers in the Environment Act 1995 to promote the conservation of water. He conveniently omitted to explain that the Act placed that requirement not on the companies—as Labour proposed—but only on the customers.
The Secretary of State told people in Yorkshire that Yorkshire Water was a world-class company, and boasted that it was deploying its expertise in China and north America. Most people in Yorkshire did not share the right hon. Gentleman's thrill at that news. They took the view that the first duty of Yorkshire Water was to deploy its expertise—such as it is—in making sure that Yorkshire
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people get the water that they need and have paid for. Most people in Yorkshire do not like seeing their money going instead into speculative projects in China and north America, or, for that matter, into speculative shopping malls in Leeds. But that is what Yorkshire Water has been doing with its customers' money.
A week later, the Secretary of State changed his tune again and said that he might take action to require the water companies to cut their leaks, but he added that that would have to await the National Rivers Authority report on water conservation. Six weeks later, the NRA published its report, which vindicated everything that we had been saying. It said that reducing leaks was the most effective way of conserving water and that cutting leaks was twice as effective as installing water meters.
It is not just the experts who support what Labour has been saying. Throughout the country, people know that leaks are the main cause of the water shortage. They know that water companies are not doing enough to reduce the leaks. They know that compulsory water metering, which the Government support, would be an expensive racket at the expense of the customers. They also know and feel strongly that the water companies should never have been privatised in the first place.
Nowhere do people feel that more strongly than in Yorkshire. People have experienced hosepipe bans and drought orders. They have seen Yorkshire Water harming the environment by draining too much water out of precious lakes and rivers. They have seen Yorkshire Water forced to interrupt people's peaceful occupation of their homes and damage the environment by dispatching huge fleets of tankers all over the county. This is the county where one third of all water distributed leaks out of the company's pipes. This is the county where the water company continues to blame its customers for the shortages. This is the county where the water company officials have the cheek to suggest that local firms should shut down or relocate because they have the audacity to use too much water. This is the county where the company first promised to guarantee water supplies to residential homes for the elderly and then went back on its promise. This is the county where the company said that it needed drought orders, then that it did not—in the middle of the Tory party conference—and then that it did. Now it is not quite sure.
The company ignores its customers. As we have heard, it ignores the needs of local business. It ignores the views of the fire brigade. It ignores the views of the local authorities. All in all, the record of Yorkshire Water is a shambles and a disgrace. That shambles was created by the original privatisation of the water industry and the stupid and expensive way in which it was gone about at the expense of the taxpayers. It has been augmented since by Government complacency and the incompetence of the overpaid bosses of the company.
Dr. Keith Hampson: If the hon. Gentleman checked the figures, I think he would find that in the period around 1976, when the industry was nationalised and accountable to the then Labour Government, investment levels were halved by the Labour Government. That must have had a major effect on the problem of bad pipes, rotting sewers and the leakage factor. If the investment had gone in under the Labour Government, we would not be in the mess that we are in now.
Mr. Dobson: Thank you, Mr. Rip Van Winkle. The Tory party nationalised the water industry, taking it out of the hands of the local authorities that had run it so well. No doubt the hon. Gentleman voted for that. Certainly, the Secretary of State voted to nationalise the water industry. They should know that when the water industry was nationalised, average investment per year under the Labour Government was a third higher than the average under the Tory Government. As the hon. Gentleman would have known if he had come into the debate, virtually all the investment since has been entirely at the expense of the taxpayers and drawn from the massive subsidy that the companies were given at the time of privatisation.
Yorkshire Water's insulting answer to the catalogue of lunacy that we have heard about today is to apply, God help us, for a charter mark and appoint a new public relations official on £80,000 a year. No wonder the people of Yorkshire are sick to death of what has been happening. No wonder they are turning in greater and greater numbers to the Labour party, the party of the Members of Parliament and councillors who have spoken up for local people and local businesses and have not proved to be apologists for Yorkshire Water.
Labour's representatives have told the truth. They have exposed the facts and suggested sensible answers to the problems. Conservatives have always defended the pay and perks of the water company bosses. Now they are even reduced to defending their leaks. I remind the House that leaks are running at half a million gallons a minute. That means that during this debate, 45 million gallons of water will have leaked out of the water pipes of the companies and 6.5 million gallons will have leaked out in Yorkshire alone.
The Secretary of State has sent the Minister along to defend the position. He is going to have a job because it is what the Tory party believes in—subsidised private monopolies ripping off the public.
12.14 pm
The Minister for Local Government, Housing and Urban Regeneration (Mr. David Curry): The purpose of this debate should be to try to give some reassurance to the people of Yorkshire and to show them that we understand their deep concerns. I should be very happy to engage in party political warfare at any time at the hon. Gentleman's invitation, but the purpose now must be to get some facts before the people of Yorkshire.
I should like first to deal with what has already been done and then look a little towards the future. At the moment, some 35,000 tonnes of water is being tankered daily into Leeds, which is about 17.5 per cent. of demand; 20,000 tonnes of water is being tankered into Kirklees, which is about 18 per cent. of the demand; and 12,000 tonnes of water is going into Calderdale, which is 24 per cent. of the demand. Up to now, we have granted 20 drought orders, the most important of which have dealt with four categories of activity: first, reducing the flow of water from the reservoirs in the Pennines back into streams that were originally designed to boost the supply of water for the wool textile industry in Yorkshire in the 19th century; secondly, giving Yorkshire Water the authority to take water from the Ouse and the Wharfe; thirdly, enabling Yorkshire Water to tap special sources of water, such as ornamental reservoirs and water-skiing surfaces; and, fourthly, prohibiting non-essential uses.
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Yesterday my Department approved an order to allow the use of borehole water and for the owners of the boreholes to sell or to give that water to other people. We have received—or, I imagine, will receive within the day—applications for two new drought orders. We have also received a demand to cut further the compensation flows from reservoirs. Some 28,000 tonnes flows from the reservoirs into the streams daily, which represents about 20 per cent. of the supplies to Kirklees and Calderdale, and the application is to reduce that flow.
We expect to receive an order—I believe that the advertisement has already been published in Yorkshire—for further extractions from the Wharfe to be made at Arthington to supply Leeds and at Lobwood in the Hollins for Bradford. We shall consider those orders as rapidly as we are permitted to do under the statute. We shall also, however, fully take into account our wide responsibilities when we consider those orders, including environmental considerations.
A number of hon. Members mentioned the question of the pipeline. I think that it would be helpful if I were to make a few remarks about that. Three questions have to be settled. First, the National Rivers Authority has some concern about the environmental effect of water from the Tees being added to the Swale and the Yorkshire water system. That is a legitimate concern and it clearly has to be decided. Secondly, in regard to the level of extraction at Moor Monkton, there is a problem of pumping capacity and the pipelines. One could argue that the most urgent need is for pipeline work on the link between Moor Monkton and Eccup and for the pumping facilities to be put in place. Thirdly, there is some concern about the level of pesticides in the water from the Ouse and the ability to treat it before it enters the drinking water system. That is again a legitimate environmental concern. If one were to act, with due risk, immediately, people would later ask, "But were the serious issues that were raised borne in mind?"
Mrs. Mahon: Will the Minister give way?
Mr. Curry: No. I have not intervened on other people and I have very little time.
I must make it clear that I believe that Yorkshire Water must as a priority deal with the bottleneck at Moor Monkton. I believe that it has to continue work on the pipeline option, and I wish to make it absolutely clear that no planning problems will be allowed to stand in the way of the construction of that pipeline. We can authorise the construction through the use of drought orders, and we will not hesitate to do so.
On the purchase of water, I shall make one thing clear. When one water undertaker has to take water from resources controlled by another, it has always had to meet the reasonable costs. Under the privatisation arrangements, that system continues. If there is no agreement on the reasonableness of the cost, the Office of Water Services has to arbitrate.
I must inform the hon. Member for Wansbeck (Mr. Thompson), therefore, that I am moved by his concern for the shareholders of Northumbrian Water, but there might not be quite the bonanza that he anticipates on their behalf because of the requirement that the water should be sold at a reasonable cost. I certainly welcome the embracing of the capitalist ethic by at least that member of the Labour party, however.

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The postponement of the earlier public hearing was due to a Government decision in the light of advice from the National Rivers Authority to allow those major abstractions from the Wharfe.
The public inquiry has just concluded and we have not yet received the inspector's report, but my advice is that we are likely to do so today. I wish to make it absolutely clear, as I have made it clear in Yorkshire and at a series of meetings with Yorkshire Water, that there is no question of the Government simply receiving the report, allowing a decent interval to pass and signing it through. Before he even contemplated the emergency drought orders, the Secretary of State would want to be convinced that they were the last of all possible last resorts and that the only alternative was to run out of water. I must emphasise that point because any impression that the inquiry was a mere formality to provide cover for a Government decision is not true. I have spelt that out categorically in those terms to Yorkshire Water as clearly as I am spelling it out in the House.
Let me spell this out clearly, too—in the present circumstances, that order will not be made. The measures already taken, particularly the reduction in compensation flows from reservoirs, even given below-average rainfall, will permit the reservoirs to fill. Until now, the problem has been the constant decline in reservoir levels and concern about the quality of the water that was left at the very bottom once they got to between 11, 12, 13 and 14 per cent. of capacity. The measures that have been taken should permit the reservoirs to fill. If we were to accede—I emphasise the conditional because we have to take the decision in the light of all our responsibilities, including environmental ones—to the two most recent requests and had the option to change the terms of those requests in giving the consent—it is not merely a question of saying yes or no, because we can vary them—the reservoirs would be able to fill more rapidly.
The hon. Member for Bradford, West (Mr. Madden) asked about the compensation arrangements. The statute lays down the position. If an emergency drought order interrupts supply, compensation is ruled out under long-standing statute law, which has stood under both Labour and Conservative Governments. It is for the Director General of Water Services to decide to hold an inquiry. As the House will know, he has been following the matter very closely indeed.
Mrs. Helen Jackson: Will the Minister give way?
Mr. Curry: No.
What Yorkshire Water does in terms of its own inquiries is entirely for it to decide, but it is important for us to draw conclusions from what has happened this year, to ensure that it does not happen again. I have made it clear once again to Yorkshire Water that, irrespective of the weather conditions and the rainfall, we must not find ourselves in a similar position next year. That means a sustained programme of refilling reserves in the reservoirs in the coming months and of putting right some of the faults in the system.
As I have said in public and to the company's face repeatedly, a justifiable criticism can be made of the company. At the turn of June or in July last year, it should have realised that demand was going through the roof. It
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was rising rapidly and the company did not respond quickly enough and placed too great a hope in the weather eventually changing. If it had acted more rapidly, particularly to reduce compensation flows out of reservoirs into streams, we would have been in a much better position now. At their height, the flows were about 80,000 tonnes a day, which is half the entire consumption of Calderdale and Kirklees. Frankly, the water was running to waste.
Action has to be taken on four fronts. The first is for Yorkshire Water. It is urgent that the company addresses itself to the problems of the distribution grid within Yorkshire. It inherited an extremely old, unmodernised and out-of-date grid and serious problems are caused by, for example, subsidence from mining, which makes it difficult to improve and replace the system—[Interruption.] I hope that hon. Members will recognise that fact when Yorkshire Water has to replace the grid and improve the mains in places such as Halifax. It will mean considerable disruption because of the road and engineering works that it entails. I hope that they will not complain about the disruption when that work takes place.
Secondly, Yorkshire Water has to ensure that it is able to secure the necessary long-term water supplies. It must study rising demand and the possible trends and realise that, in five out of the past seven years, there have been hosepipe bans, which should have been a litmus test for the problems to come and led it to take action earlier this year. Now the company has to set out clearly the actions that it will take in the medium and long term. That means dealing with the leaks and reviewing the compensation water regimes, which the Secretary of State has already undertaken to review.
It is a matter of renewing the grid network within Yorkshire so that capacity is improved, particularly to enable the company to move water east-west. As the hon. Member for Bradford, North (Mr. Rooney) said, one of the problems has been that rainfall has tended to be in the east, whereas the historical pattern was for rain to fall over the Pennines. The company has to consider improvements in pumping capacity and the overall supply position. That may include looking for new, long-term supplies, including Kielder Water—no doubt to the eventual long-term benefit of shareholders in that company.
The Government have made it clear that, if the companies do not do well enough, we shall consider statutory leakage reduction targets.
Mrs. Ann Taylor: Consider!
Mr. Curry: That is a responsibility that should fall on the companies. That is why there is a statutory undertaking. Although the Labour party is deeply in love with the Armageddon strategy, and would love Yorkshire to run out of water, which would give it political satisfaction, I do not intend to give it that satisfaction—[Interruption.]
Mrs. Mahon: Will the Minister give way?
Mr. Curry: No.
Mrs. Mahon: On a point of order, Mr. Deputy Speaker. That is the most outrageous and insulting remark and the Minister should withdraw it immediately.
Mr. Deputy Speaker (Sir Geoffrey Lofthouse): Order. That is not a point of order for the Chair. In the few minutes available, I should have thought that the House would want to hear what the Minister has to say.
Mr. Curry: I realise that there is colossal concern in Yorkshire about the situation. I have tried to outline the position and what can be done about it. The Labour party has engaged in a constant programme of political barracking, which I do not think will be appreciated by the people who are concerned in Yorkshire. It is a tone different from that of the constructive conversations that I have had with Labour Members from Yorkshire. I wish that that had been carried through into this debate and not what we have heard this morning.
I can well appreciate that, for Yorkshire Water, the satisfaction of shareholders matters. I can equally understand the importance of the views of its City analysts and financiers. However, the people who matter most of all are the customers and consumers of Yorkshire Water, because they have nowhere else to go. They must be given priority in the future investment programmes of Yorkshire Water.

Education Funding (Northumberland)
12.30 pm
Mr. A. J. Beith: We have plenty of water in Northumberland. It is funds for schools that we are short of. I am tempted to offer to trade one for the other because we are in such a desperate state and the Minister has so far not been able to offer us much. We intend to seek more from him today.
In September, a leaked memo from the Secretary of State for Education and Employment acknowledged that there is a perception that schools are underfunded and that peace in the classroom threatened. If that is true at national level—and it is a remarkable admission—it is even more true in Northumberland because of specific difficulties about the funding of education in our county.
In the already underfunded education system, there are authorities which have been placed in an especially difficult position by the failure of the standard spending assessment mechanism, which does not take adequate account of regional differences and the additional pressures that face some areas. That problem is made worse by the capping system. Some authorities threatened to set deficit budgets because they felt unable to make yet more cuts.
Perhaps one of the greatest sets of difficulties is that faced by Northumberland, which lost about £7 million when the SSA replaced the former system of education funding. The authority was particularly disadvantaged by two factors. The first was the additional educational needs factor. Northumberland lost about £5 million because of the large increase in the percentage of the SSA formula that was devoted to additional educational needs, which are needs different from those prevalent in Northumberland. The other factor was area cost adjustment, which was also increased substantially when SSAs were introduced, and affected Northumberland especially badly.
Northumberland is geographically the largest of the shire counties; its population is the smallest except for that of the Isle of Wight. That means that it has lowest population density and all the problems that that brings. Sixty out of the county's 146 first schools have fewer than 100 pupils. A number are very small, with fewer than 25 pupils, but are in remote places where it is necessary to retain a school. Small schools are expensive to maintain.
Distance is another problem. Pupils in some parts of the county have to travel 15 or even 25 miles each way to school, which is a major cost to the budget. The extra cost arising from small rural schools is about £1.3 million; rural school transport costs £3.7 million. Of course, if more schools are cut, the transport bill will go up. The sparsity factor in the SSA does not adequately compensate the county council for the extra costs.
As well as the initial losses, Northumberland county council has experienced four years of budget reductions which, according to its calculations, have wiped another £13.4 million from the education budget in real terms, based on a standstill budget. Considered year by year, in 1992–93 there was a £3.8 million cut against a standstill budget; a £4 million cut in 1993–94; a £4.6 million cut in 1994–95; and a £1.235 million cut in 1995–96. That last figure would have been higher if the county had not cut its reserves to £4 million. An auditor's report the year

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before said that letting the reserves fall below £6 million would be imprudent, but the county felt obliged to take that action.
In money terms between 1992–93 and 1995–96, the total education budget for the county rose by 5.7 per cent., taking account of the changes in further education, when the retail prices index grew by 11.8 per cent. and the number of pupils in Northumberland schools increased from 45,960 to 48,454. At the same time, teachers' salaries, which make up four fifths of the budget, have increased by 28.5 per cent.
School budgets have been hit badly. Although in cash terms some schools have had their budgets increased since 1992, that increase has been undermined by inflation, teachers' salary increases and the additional costs of local management. The Office of Standards in Education warned that further cuts at one school would seriously affect its ability to meet the statutory requirements of the national curriculum. Pupil-teacher ratios in Northumberland have been deteriorating at an alarming rate compared with the average in the rest of England; compared with Scotland, the situation is worse still. We make the comparison with Scotland because it adjoins us.
Mr. Jack Thompson: I congratulate the right hon. Member on obtaining this Adjournment debate. There is another element that needs to be recognised in respect of Northumberland. I am told that, in a rural area in the right hon. Gentleman's constituency, there is a class of seven. That is fine, because it is a small rural school and it is the only service available.
In my part of Northumberland, we now have classes of more than 30 to 35 on some occasions. The big problem in Northumberland is that four fifths of the population lives in the south-east corner and the rural areas are sparsely populated. They still require education services, but they have to be provided on a two-level basis. We have a shortage of spaces in the south-east and a surplus of spaces in the rural parts.
Mr. Beith: I am grateful to the hon. Gentleman for underlining the point that I made earlier about the cost of maintaining schools in scattered rural areas. It is an essential cost because it would not be reasonable to remove schools altogether from areas as remote as some of the places concerned.
The average pupil-teacher ratio in England was 17.4 per cent. in 1993. It was 15.4 per cent. in Scotland; in Northumberland, it was 19.4 per cent. Since then, it has worsened. The Fairshares campaign, which is an independent group of parents in Northumberland who have united to campaign for adequate funding, produced a detailed report on the issue. It carried out a survey of Northumberland schools and found that among respondents, 85 per cent. of schools had experienced an increase in the pupil-teacher ratio between 1991 and 1995.
Class sizes are similarly bad when compared with other areas. The average for England and Wales is that around one quarter of primary pupils are in classes of 30 or more; in Northumberland, approximately half are. That figure relates primarily to the towns and the urban, south-eastern part of Northumberland; classes have to be smaller in rural areas where pupil numbers are low. On top of that, schools have to rely on parents to raise money for
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essential equipment and to continue the employment of existing staff. The vast majority of schools surveyed made use of money raised by parents for such purposes—almost a quarter of it for essential items.
The leadership of the county council responded to the crisis in which it was placed by proposing earlier this year to close 10 first schools, six of them—Hipsburn, Acklington, Linton, Milfield, Horncliffe and Thropton—in my constituency. A number of those 10 are popular schools whose pupils cannot satisfactorily be accommodated elsewhere. Others are village schools in places distinct or remote from the nearest community that would still have a school. It was an unwise response to an admittedly difficult situation. Indeed, the county council has now dropped the proposals and is concentrating on trying to get better funding.
The funding changes have placed Northumberland towards the bottom of the spending tables for education. The Chartered Institute of Public Finance and Accountancy statistics show that Northumberland is ranked towards the bottom of the table of potential schools budgets per pupil in English counties. Oxfordshire has more than £200 more potential schools budget per pupil than Northumberland.
This week, I received a letter from the head teacher of King Edward VI school in Morpeth, in the constituency of the hon. Member for Wansbeck (Mr. Thompson), which takes many pupils from my constituency and has an outstanding record. She used to be the head of a school in Cleveland. She calculated the different funding that would have been available to her school in Cleveland. The difference amounted to more than £450,000. She asked:
"Would you please explain to me why I need so much less money to run my school in Northumberland?"
I was recently told about a school which was forced to ask parents to raise £25,000 to bring its facilities up to the standard expected under the national curriculum. The school failed in three areas when it was inspected by Ofsted and all of them were due to lack of funding.
Mr. Ronnie Campbell: I congratulate the right hon. Gentleman on getting this debate because it is a matter that needed to be debated. Can he develop the argument about nursery vouchers? The Government are going to give £1,000 per child throughout the land. If that goes for nursery school pupils, should not the figure apply to all pupils throughout the land? Would not that be a better system of financing local schools?
Mr. Beith: I am not sure that I would want to construct the funding system on that basis. The fact remains that the amount available per pupil, which is what the hon. Gentleman was getting at, in Northumberland is very much less than in comparable areas and much, much less than in places such as inner London. Northumberland is being asked not just to make efficiency gains, but to make cuts, time and time again. Schools are struggling desperately in the face of that. The chairman of governors of one high school wrote to tell me that his school has been forced to make several part-time and full-time teachers redundant to balance the budget. He pointed out that that would have been avoided if Northumberland had only half as much extra per pupil as some authorities receive.
Another constituent has written to tell me that in her first school, caretakers and meal supervisors are doing extra duties for no remuneration and giving up their

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complimentary lunch to save the school £5 per head per week. The school is dependent on the charity and good will of its staff. Another high school lost three teachers, a caretaker, out-of-school activities and staff preparation time. There was an increase in class sizes and the school could not repair its heating system, all as a result of recent cuts.
There is enormous strength of feeling. More than 3,500 people in Northumberland have written to the Secretary of State for the Environment about the standard spending assessment as it affects education funding. I could find many more examples of the way in which schools have had to cut staff, deliberately taking on far less experienced staff in an attempt to reduce costs. Perhaps the final word should go to the constituent who wrote to the Secretary of State for the Environment:
"I challenge you Mr. Gummer to go into a class of 42 reception children and get them changed and organised for a physical education lesson."
I am waiting for the Secretary of State to avail himself of the opportunity and to see just how difficult the task is. Large class sizes do not mean only the problems mentioned by my constituent, but half as many books again to mark and half as many parents again to see. All those problems make it impossible to give the level of attention teachers see as required.
When pressed, the Government say that it is not their fault; they claim that the fault lies with the local authority and its decisions on funding priorities. They say that the county council could solve the problem by managing its school budget more efficiently and they say that the schools could solve the problem by spending their contingency funds. None of those arguments holds water in Northumberland's case.
Northumberland spent more than the SSA levels on education, yet its education spending is one of the lowest in the country. It is prevented by capping from raising any more money. Between 1993–94 and 1994–95, Northumberland's SSA increased by 4.4 per cent. The Government were saying, "Yes, you do need to spend more money," yet Northumberland was allowed to spend only 1.75 per cent. more, so the Government were saying at the same time, "No, you cannot spend it." It is like saying to someone, "You can have £5 a week more pocket money, but I am inventing a rule that says that you cannot spend it." In this case, we are talking not about pocket money, but about essentials.
I am hardly a fan of the Labour administration in the county hall—indeed, I am often a critic of some of its decisions and spending priorities. However, it is accepted on all sides, including the Conservatives on the county council, that the problem cannot be resolved just by changing the county's spending priorities. Indeed, in 1990–91, the Audit Commission's view was that Northumberland was not mismanaged. The commission said:
"Our overall impression is that the Authority is well managed at both member and officer level."
Since then, the costs of education other than in schools have been reduced by almost a quarter. Comparisons with other areas on this point are favourable. In a sample of comparable counties, including Buckinghamshire, Lincolnshire, North Yorkshire, Norfolk and Cumbria, Northumberland's costs were the lowest. Administrative costs as a percentage of the potential schools budget were,
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at 1.93 per cent., only slightly higher than those of Cumbria and Lincolnshire, and lower than those of the other authorities mentioned. Given the lower pupil numbers, that suggests that education administration in Northumberland is efficient.
The contingency funds are largely mythical. Schools have no more than two weeks' operating costs, if one averages it across the board, kept as contingency funds. Any small business would regard that as a small margin, especially when some of the funds are earmarked for essential projects. In a very small school, one family leaving the area can slice more than that two weeks' contingency fund from the school's budget for a year. Schools have to keep something in reserve.
The Government and the Prime Minister claim that education has become a priority. This is the opportunity for them to match words with action. The Government should bear in mind the £7 million that was lost through changing the funding arrangements and consider restoring that funding. I urge them to review the standard spending assessment formula to give a fair allocation to Northumberland. The Department of the Environment is reviewing the area cost adjustment, but the review needs to consider the particular problems highlighted by underfunding in Northumberland. We need action sooner than the time scale of the review will permit.
I fear that if we find in the Budget in a week's time that there is some more money for education, it will all be eaten up to match the existing amount that local authorities spend over their standard spending assessments and to deal with new responsibilities, such as the extra costs for special needs which are now required—that is estimated nationally to be more than £400 million—new rules on seat belts in school transport, EC legislation on part-time staff, new school transport entitlements and local government pension scheme costs. In those areas, any new money over and above inflation that the Government promise will be eaten up, not just in Northumberland, but in other places.
In Northumberland, we have a large need over and above those other needs. I plead with the Minister to recognise that need and to realise that it is accepted across the board, by people in all political parties on the county council and here in the House. There are Northumberland Members from all three political parties present in this debate. I urge the Minister to respond to the plea.
12.44 pm
The Parliamentary Under-Secretary of State for Education and Employment (Mr. Robin Squire)s: I am grateful to the right hon. Member for Berwick-upon-Tweed (Mr. Beith) for initiating this debate, thus giving the House an opportunity to consider how education is funded in Northumberland. I also welcome hon. Members on both sides of the House to the debate. I make one introductory comment in response to an introductory comment by the right hon. Gentleman concerning a certain memorandum. I reiterate what my right hon. Friend the Secretary of State for Education and Employment has said more than once. She did not devise, write, sign or use that memorandum. Although we never comment on leaked alleged memoranda, it is only fair to put that point on record in light of the right hon. Gentleman's opening comment.

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Inevitably, what I say today can, in part, be only a curtain raiser for the announcements that will be made next week by my right hon. Friends. Tempting though it is to say much more, I must decline invitations, however kindly given by the right hon. Gentleman, to say more about funding for education in Northumberland for 1996–97.
The first education expenditure matter on which we all need to be clear is that Northumberland county council, like every other local authority, is responsible for setting its education budget and deciding the priorities between and within services. The council has the final say on how much is spent on education and how much is spent on other services.
We heard—I expected it—a lot from the right hon. Gentleman about reductions, past, present and future, in Northumberland's education budget. I have already made it clear that I can say nothing about next year's financial settlement except this. Neither hon. Members nor Northumberland county council can yet have a clue about the level of that settlement. Any talk, therefore, of budget cuts must be purely speculative. Frankly, it is irresponsible for local authorities to ring alarm bells at this time of the year when they cannot know how much money they will have in 1996–97. I make it clear, for the avoidance of doubt, that a number of local education authorities, including Northumberland, Lancashire and East Sussex, have indulged in that practice. At the very least, it does not assist in rational discussion of these matters.
Mr. Jack Thompson: Is the Minister aware that I am chairman of governors of one of the schools in my constituency, Newbiggin middle school? Last Friday, the board of governors had a meeting. In our budget preparations, we had to take into account the possibility of having a reduction of between 1 per cent. and 3 per cent. That is the simple logic that one must use in planning and preparing for an academic year for a school. We also have to consider the next year, the year after and the year after that. We have to take into account the welfare of the pupils, the staffing levels, the provision of resources and the building itself—the whole gamut of running a school. One has to prepare and consider those factors and take them into account, otherwise one is caught with one's pants down.
Mr. Squire: I am grateful for the hon. Gentleman's work in his capacity as chairman of governors. Of course I endorse the point that all governors and all local authorities must plan ahead. My point was specific. I speak as the recipient of many letters, from across the country, which have been caused by local education authorities describing now, in advance of next week's settlement, exactly the cuts or whatever they will face. I repeat for the hon. Gentleman and the House that those figures cannot yet be known and that such talk is, at this stage, alarmist.
The right hon. Gentleman said that Northumberland has been forced to cut millions of pounds from its education budget this year. That is not true. Northumberland has been able to increase its education budget by some 2 per cent. this year and is able to spend over £200 million on all services. That, I submit, is not bad in a year in which local authorities face a tough, but fair, settlement.
Mr. Beith: Will the Minister give way?
Mr. Squire: I wish to make progress. The right hon. Gentleman made a number of points and in fairness to him I would like to reach them. If I have time, I will willingly give way. As he knows, I do not refuse to give way.
So from where does the talk about cuts come? The county council is not cutting what it is actually spending; it is drawing up a shopping list of additional spending, fully uprating for all price and income movements, and then cutting back on what it would ideally like to spend if it could buy all the items on that list.
We have to recognise the wider background to the financial settlement for Northumberland. The Government have made it clear all along that this year's settlement has been tough. That is necessary to constrain increases in public expenditure, since local authority expenditure accounts for roughly a quarter of all public expenditure. The whole of the public sector should be looking to meet pay and price pressures, and to make efficiency savings. The long-term future of funding for education in Northumberland depends on ensuring that the economy is placed on a firm footing and that Government keep a firm grip on inflation.
We should give more attention to what Northumberland county council is doing with the funds it receives from central Government. There are important questions which schools and parents will want to ask the county council. Is it achieving value for money? How many surplus places are there in Northumberland schools and what does the county council intend to do about them? I shall not exchange comparative figures because that would be tantamount to telling Northumberland exactly what it should do, but I shall say that the county council has some way to go to catch up with what a number of LEAs are already doing.
The right hon. Gentleman mentioned class sizes in Northumberland schools. Despite the horror stories that appear about class sizes of 30, 35 and more, the facts are that the latest available data show that the average class size in Northumberland schools is 27 in the case of primary schools and 23 in the case of secondary schools. If there are individual class sizes of over 30, it is up to the county council in the first place, and those managing school budgets in the second, to explain to parents why those particular class sizes are so far above the Northumberland average. There could be any number of reasons: the level of teaching done by the head teacher and deputy—
Mr. Beith: The rural factor.
Mr. Squire: I fully concede that and I will say more on the rural factor if time permits.
Other reasons include the degree of non-contact time, a bulge in the pupil population, the physical size of classrooms and the general organisation of teaching and learning at the school.
I remind the House of the main finding in the recent Ofsted report based on inspectors' independent observations. There is no simple link between the size of class and the quality of teaching and learning within it. The selection of teaching methods and forms of class organisation have a greater impact on learning than the

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size of the class. For example, how well classroom assistants are used alongside teachers is an important factor influencing the quality of teaching and learning.
It is interesting to compare the quality of education in Northumberland with schools elsewhere with smaller class sizes. Look, sadly, for instance at Hackney Downs school, where spending is two and a half times the national average per pupil, and the pupil-teacher ratio is 8:1. That illustrates my point, particularly as the coincidence of small class size and failing schools is by no means limited to Hackney Downs.
Mr. Peter Atkinson: Pupils in Newcastle get far more funding per pupil than those in schools in Northumberland. Newcastle gets £651 per head of population in grant while Northumberland gets £482. Northumberland is in the top half of local authority schools in the league table, but Newcastle is second from the bottom and is clearly failing its children.
Mr. Squire: My hon. Friend makes a very important point. I will deal with the SSA system on differential funding, but he must be right to say that, at any given level of funding, there is a considerable difference in the outturn as a result of that funding, as we have seen most recently in the tables published this week. In particular, schools in disadvantaged circumstances can perform tremendously while others in similar circumstances cannot currently do so. I know that heads and governors in those circumstances will revisit their own schools' experience.
I thought optimistically that I might get away without discussion of the standard spending assessment, but I understand why the right hon. Member for Berwick-upon-Tweed raised it. Next week, my right hon. Friend the Secretary of State for the Environment will announce his proposals just after the Budget, but I can make two points about the SSA methodology. Both will be familiar to hon. Members but they none the less concern two essential elements of a methodology which would purport to be fair.
The first is that the education SSA system does not set out to allow the same level of spending for each pupil, nor should it. That is the point raised by the hon. Member for Blyth Valley (Mr. Campbell). The system aims to provide funding for a common standard of service across the country, taking account of the fact that the costs of providing education vary from one LEA to next. As need varies from one council to another, so logically does poundage per pupil.
Each authority's education SSA reflects the relative costs of educating children in very different circumstances: in sparsely populated areas; in London and the south-east where labour costs are higher; and in areas of socio-economic disadvantage or with a high proportion of non-English-speaking children.
I know that the sparsity allowance is a particular concern to Northumberland, and the right hon. Member for Berwick-upon-Tweed mentioned the problem of running an education service in a scattered rural area. The fact is that, alone of all the factors in the education SSA
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formula, including the much-loved area cost adjustment with which I shall deal shortly, the weight given to the sparsity allowance is 50 per cent. higher than the raw statistical evidence would suggest.
Alongside all the representations I receive about a bigger slice of the SSA cake for rural authorities, I have to consider the position of those authorities that object to that 50 per cent. judgmental uplift. They might ask: why should the Government not reduce it, or increase the weight on additional educational needs, or even uplift the area cost adjustment by 50 per cent. as well? All those arguments have to be balanced against each other. Our aim is always to arrive at the fairest formula possible for distributing grant between authorities. In consultation with the local authority associations, we will continue to consider carefully the arguments for and against making changes.
I want to say a brief word about the area cost adjustment, since I know that it is a particularly controversial aspect of the formula that hon. Members on both sides of the House have raised with the Government. The right hon. Member referred to the level of support going to local authorities in the south. Everybody agrees that there has to be an area cost adjustment. Not even Northumberland county council would abolish it altogether. It is the unanimous view of the various local authority associations that some recognition of the factors that lie behind it must be made. Those LEAs that get it say that they need to spend even more, and those that do not say that the money needs to be redistributed to them. That is perhaps unsurprising.
The Government, however, want to make progress on this issue. As the right hon. Gentleman mentioned, my hon. Friend the Minister for Local Government, Housing and Urban Regeneration met leaders of the local authority associations on 16 October to discuss the area cost adjustment. My hon. Friend proposed that we should set up an independent review of the area cost adjustment to try to ensure that it receives uniform support among LEAs. I know that that review will be welcomed by many hon. Members even if, inevitably, the consequence of that review cannot reasonably feed into the announcement that the Secretary of State for the Environment will make immediately after the Budget.
The right hon. Member for Berwick-upon-Tweed briefly mentioned capping. I know that there is a wide range of opinions on that subject, but capping is important as part of the Government's wider economic objectives.
We should be clear in our minds about the way in which capping works. It does not force local education authorities to cut their budgets; rather it limits the rate at which they can increase them. As I mentioned at the start of my speech, there is little that I can say today about the role of capping in 1996–97. The right hon. Gentleman will have to wait—but only a short while—for the relevant announcement to be made.
This has been a short but wide-ranging debate and I am grateful to the right hon. Gentleman for allowing me the chance to put the record straight on several issues. I am sorry none the less, especially as a result of the coincidence of timing, that I cannot say more about the settlement for 1996–97 now.

Portsmouth (Fleet Maintenance)
1 pm
Mr. David Martin: I am most grateful to Madam Speaker for granting me a timely opportunity to mention the fleet maintenance and repair organisation, the future of which vitally affects, not only my constituents, but those of my hon. Friends and neighbours, whose strong and assured support I thoroughly welcome.
The latest review into the planned market test of the FMRO plainly threatens its continued existence in carrying out docking and essential defects requirements, as well as being responsible for organising a great deal of unscheduled work on ships.
Mr. Peter Griffiths: I realise that my hon. Friend has only a short time. I interrupt him only to pick up the argument that he made to start with, which was that we are debating not a narrow issue, but one that widely affects the whole Portsmouth travel-to-work area and the economy of southern Hampshire. Only a firm assurance that the FMRO will continue as a single unit with a solid work load will remove the threat to the necessary morale of the economy in that part of the country, extending much wider than the constituencies in Portsmouth.
Mr. Martin: I am most grateful to my hon. Friend for making those valuable points, which I am sure will be considered by my hon. Friend the Minister.
I concede at once that it is necessary always to consider whether public money is being spent properly or should be spent at all. That is the case with every Government Department, and the current public expenditure round is no exception.
In defence, the priority is, rightly, to spend for the maximum benefit of the front line, but it is my main purpose in this debate to show that the front line—in this case front-line surface ships of the Royal Navy and the people who serve in them—is indeed best served if the finest Royal Navy ship repair facility, the FMRO, is allowed to continue its work, made even better by the market-testing operation to which Ministers and Royal Navy personnel are already signed up, and which, unlike the position at Devonport, is attracting very healthy commercial interest from some very hard-headed business men.
In making such claims, I do not rely on the proud traditions and sentiments stirred by 500 years of Portsmouth dockyard's unparalleled contribution to shipbuilding, refitting and repair, although, as a Conservative, such considerations weigh with me, as I am sure that they do with my hon. Friend the Minister.
Today, I rely wholly and only on the present-day facts. The more that those facts are considered dispassionately on public expenditure grounds as well as grounds of front-line operational efficiency and effectiveness, including the well-being of sailors and their families, the more rational minds are driven to the conclusion that it would be madness to interfere with the present planned arrangements for the FMRO, and plain common sense to give it the opportunity that it deserves to serve the fleet on the new basis envisaged.
What are the powerful arguments for keeping a facility for maintenance and repair work at Portsmouth? First, plainly the review of the market-testing operation is being
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offered up as a cost-saving measure, probably also in an attempt to help the faltering privatisation plans and the position at Devonport. However, far from public money being saved, I have heard a reliable prediction that, if all the effects of messing about with the successes of Portsmouth to transplant elsewhere are taken into account, the cost would be at least £200 million.
Secondly, 58 per cent. of the surface fleet—42 ships, including the three carriers—is based in Portsmouth. The cycle of ships at sea these days places greater pressure on their operational capacity, requiring speedy access to an efficient and flexibly run repair and maintenance facility between refits.
A good example is the carriers, one of which, Invincible, soon to be replaced by Illustrious, is required to be on station in the Adriatic because of the continuing unstable position in Bosnia and the former Yugoslavia. That requirement shows no sign of ending while front-line British troops are involved in that theatre, whether helping to keep the peace or implementing any peace settlement.
Although programmed ship projects comprise only 4.25 per cent. of the total naval ship repair programme, they are essential to operational effectiveness and availability of Portsmouth ships. Overhead costs are shared with maintenance of the operational base. It would, for instance, be potty to separate the utilities from the market-testing process. Any transfer of work elsewhere is therefore highly questionable in savings terms. Transferring DEDs work to Devonport would not make a significant impact on the position in Devonport, but it would mean everything to Portsmouth.
Thirdly, if more than half the surface ships are based in Portsmouth, it would be nonsense not to have facilities for their repair and maintenance on hand. If the facilities were to be removed elsewhere, base porting would probably follow, and the finest docking provision in Europe would be run down. As my hon. Friend the Minister is aware, base porting is a vital part of the harmony rules for sailors serving on board, who are entitled to a certain number of weeks each year in their base port.
Many years have been spent and consistent policy decisions made, concentrating not only on ships but on administrative headquarters and training establishments for the Royal Navy in and around Portsmouth, not for the fun of it but because greater consideration for home and family life, for summer leave, school holidays, Christmas and so on is very much part of recruiting for, retaining in and running a modern Royal Navy. That should also be an important consideration for a modern Conservative Government. Any proposal that claims to make questionable financial savings while running counter to harmony rules should be rejected.
Fourthly, I shall discuss the likely commercial outcome of continuing with present plans for market testing, assuming that it is followed by a desperately needed long period of stability, at least seeing through the first few contracts under the new arrangements before any further review is even considered, let alone announced. In that context, the prime consideration is repair facilities for the Royal Navy.
Even granting that at present there is a national overcapacity of ship repair facilities—which I believe these days is debatable—instead of taking the negative "let's shut something down" line, let us admit that nowhere in Europe has greater potential to develop a

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ship docking and repair business on a sound international commercial basis, harnessing private sector companies and resulting in the cheapest possible service for repairing and maintaining ships of the Royal Navy, than Portsmouth dockyard. We can find evidence for that, not only in the private sector companies so keen to join the tendering process at Portsmouth, but in the lack of commercial investment in new ships in recent years, making more repairs needed, or likely to be needed, for those that are in use. In addition, all ferries are likely to need docking and repair facilities as new safety standards require reconstruction work. Is that to be done at Cherbourg rather than Portsmouth because we have not the nous or the nerve to compete in the market—under a Conservative Government, no less? With such opportunities, we would be mad to break up such a successful going concern as the FMRO, and for what?—to leave the docks to silent decay.
Speaking about a going concern, it is wholly relevant to the commercial potential of the FMRO to continue service to the Royal Navy, and wholly relevant to that consideration are the present Portsmouth work force, now numbering 1,450 people. I cannot speak highly enough of the massive co-operation of the trade unions and the whole work force in recent times in adjusting to new, flexible working and training arrangements, improvements in productivity and efficiency, co-operation with contractors, and mixed skills working, which has shown a dedication to meet the challenge of the market-test operation every bit as impressive as the examples that used to come out of Japan alone. Management and those on the shop floor have united in their determination in a way that even a casual visitor to the FMRO can feel in the air. That feeling is even more pronounced when one has the privilege of being shown round the facilities by a human dynamo such as Mr. Keith Crockford. One of the greatest disadvantages of the review of the market test process is that, as well as the risk of commercial bidders cooling off, the enthusiasm, energy and high morale of the FMRO staff may be undermined.
I am not exaggerating when I say that the staff believe, however wrongly, that the review will result in the closure of the FMRO. In that case, all the enthusiasm, energy, co-operation and the current reorganisation of buildings and workshops will have been for nothing. That must not be allowed to happen—it would be madness to allow it. Before any more harm is done, the decision must be taken—the sooner, the better. The damaging limbo must not last a day longer than necessary.
When I visited the FMRO last Friday, Captain John Crump, its chief executive, gave me an FMRO shield. Much as I treasure it, I am sure that he will give me another one if I pass mine to my hon. Friend the Minister on condition that he keeps it on his desk until a decision is quickly reached. As an additional reminder, I can tell my hon. Friend that the Greek historian Herodotus, with whom I am sure my hon. Friend is familiar, tells us that after the Athenians had embarrassed the Persian emperor Darius at Sardis, he commanded a slave to repeat to him three times at dinner each day, "Remember the Athenians." Over the coming days, until a decision is reached, I ask my hon. Friend to ask a civil servant to repeat to him three times each day while he tackles his health food snack, "Remember the FMRO."
1.11 pm
The Minister of State for the Armed Forces (Mr. Nicholas Soames): I am grateful to my hon. Friend the Member for Portsmouth, South (Mr. Martin) and start by congratulating him on his success in securing today's debate on a subject in which he has taken a close personal interest over many years. I am delighted to see that my hon. Friend the Member for Portsmouth, North (Mr. Griffiths) is also in the Chamber.
My hon. Friend the Member for Portsmouth, South has been an assiduous champion of the interests of Portsmouth naval base. I wish to commend him for the way in which he so vigorously fights for his constituents' interests. I also join him in expressing my admiration for the FMRO, whose reputation is excellent. I was talking this morning to a captain who had commanded a ship that had been looked after by the FMRO. He spoke warmly and highly of the quality, speed and commitment of its work. I join my hon. Friend in paying tribute to the work force, to the way in which they throw themselves into their tasks so vigorously and to the excellence of the product.
I also pay tribute to the excellent service provided to the fleet by the FMRO, and shall respond as fully as I can to the understandable concerns over the organisation's future. Those concerns have arisen following my recent announcement that we are considering whether the current market-test route remains the most appropriate course of action in the current financial and operational circumstances. As my hon. Friend rightly said, the amount that we spend on defence and the way in which we spend it is a matter of continuing review. We have to undertake a broad range of tasks and we must get everything we can out of our limited and limiting funds. I hope that I shall be able to allay some of my hon. Friend's anxieties, although I cannot promise to do so.
The FMRO is a comparatively new institution, which was opened in 1984. It has a long and proud list of antecedents stretching back to the dawn of time. In 1495, King Henry VII ordered the construction of the world's first dry dock at Portsmouth. From that auspicious beginning, there developed over the centuries the infrastructural inheritance and the skills that characterise the naval base today.
In its heyday in the late 19th century, Portsmouth dockyard, as it was then known, more than doubled its capacity through a major expansion programme. It combined ship building and ship repair with a large range of ancillary activities. As my hon. Friend knows, the dockyard, and the city, saw the most distinguished service through both world wars, but the changing nature of the Royal Navy required progressive changes in its engineering support and maintenance facilities. In response to those changing imperatives, Portsmouth dockyard ceased to build warships in the late 1960s—HMS Andromeda was the last ship built there. In October 1984, following decisions taken in the 1981 defence review, and after a period in which it gave fantastic support to the Falklands task force, the dockyard was closed.
The fleet maintenance and repair organisation was conceived as a conscious attempt to redirect naval support resources to best effect in an era of considerable financial stringency. If there were a climate of financial stringency then, the pressures today are, proportionally, even greater.

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Our priorities have not changed much since then. The FMRO was not supposed to be a scaled-down version of what had gone before. As the FMRO evolved, it enabled a major shift in emphasis that saw it taking a far greater role in supporting the active, operational fleet rather than devoting resources to ship repair work on non-operational ships.
As a consequence of the change in emphasis, ship refit work by the FMRO ceased in 1992. Since then, the organisation has specialised in providing a flexible and responsive service to operational ships through maintenance work on vessels base-ported at Portsmouth and to visiting ships. The work undertaken ranges from programmed dockings and essential defect work, which involves ships spending several weeks in dry dock, to minor engineering support. The FMRO plays an important role in allowing the crews of vessels based at Portsmouth to spend time with their families during those maintenance periods—something that would not be so easy to arrange were the work carried out elsewhere.
Mr. Peter Griffiths: I apologise to my hon. Friend for intervening. Can he assure me that the decision on the FMRO will be taken on its merits, not in the shadow of the problems at Devonport, which may be pushing the Ministry of Defence and the Minister towards a decision that they may not wish to take?
Mr. Soames: I am delighted that my hon. Friend made that intervention and I can assure him that what he suggests is not the case. The case for the operation is based solely on trying to obtain the best result. I endorse what my hon. Friend the Member for Portsmouth, South said about the importance of the harmony rules and how well they work for the 58 per cent. of the surface fleet based at Portsmouth. The rules are extremely important to the crews and those involved with them—they are allowed a degree of flexibility that other, less fortunate, people are unable to enjoy. The FMRO also provides a centre for supplying base services and utilities to the rest of the naval base, and I again join my hon. Friend in paying tribute to its admirable work.
The decision to market-test the FMRO was confirmed during the "Front Line First" study last year, and in July 1994 the formal preparations commenced. "Front Line First" confirmed that market testing was the best way of seeking efficiencies within the organisation, focusing resources on its key tasks and identifying alternative uses for any surplus infrastructure—for example, my hon. Friend mentioned more commercial utilisation of the docks. Nothing has occurred since that time to alter that judgment, and the current review will not go back to examine alternative management options, such as in-house operation or agency status. There is no basis to suggest that that would be worth while.
In the 18 months since the decision to market-test the FMRO was taken, we have seen the implementation of the "Front Line First" measures, several of which related specifically to naval infrastructure. There have also been developments in our drive to privatise the royal dockyards and in the associated programme of surface ship and submarine refits. All of those factors have implications for the future operation of the FMRO.
There has also been continuing pressure on the support area to generate the efficiencies that are needed to maintain front-line capability and to enable the MOD to live within
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its means—which is not as easy as my hon. Friend might think. Therefore, it is only proper to review programmes such as the FMRO market test to confirm that, despite the changes that have taken place since they commenced, they remain the most appropriate and cost-effective solution. I make no apology for that, although I understand the concern that has arisen out of the uncertainty.
It is also correct for such a review to be conducted before third parties have committed significant resources to responding to the market test. That is why I have announced the review before issuing the invitation to tender: a stage which companies could reasonably assume marks the start of the formal market-test process.
It would certainly be wrong to encourage companies to invest resources at this stage while there remains a possibility of not proceeding with the market test. We would be rightly criticised if we were to do that. Therefore, we are now seeking to take a view on the Navy's future support requirements at Portsmouth and examine, against the background of our existing repair and maintenance facilities, whether we are better served by proceeding with the market test of the FMRO as it currently stands or whether alternative options would offer a more cost-effective, but still operationally acceptable, solution. Those alternatives would need to take account of the whole range of existing ship repair facilities, including the royal dockyards and the wider functions of Portsmouth naval base.
As to my hon. Friend's point about the dockyards' sale, the Government remain committed to privatisation at the right price. Considerable benefits and efficiencies have emerged in the years since the dockyards' management was contracted out to the private sector, and I fully expect that to continue under privatisation. We require both dockyards to provide longer-term competition and value for money within the refit programme. The FMRO does not carry out refit work. That may change if a private sector operator wished to bid for such work, but it would not alter our policy in respect of the two dockyards.
Efficiencies within the dockyards are not an alternative to efficiencies within the FMRO: both are needed. Dockyard efficiencies are already being addressed within the sale process. It is hoped that the review of the FMRO will generate its own savings. As I have said, any alternatives would need to take account of the whole range of existing ship repair facilities and existing capacity—including the royal dockyards and the wider functions of the Portsmouth naval base.
I assure my hon. Friend—who is entitled to such an assurance—that the FMRO will be examined not in isolation, but within a coherent context which embraces the naval base as a whole entity. Work is at an early stage and I can give no indication of how it might develop, but I am of course extremely conscious of the real anxiety caused to the work force and to the wider community and, as I told my hon. Friend, I do not wish to extend it one moment longer than absolutely necessary. I certainly hope to reach a decision early next year.
My hon. Friend wants to know what options we are examining. It will be clear from my general description of the factors involved in the review that one of the routes we are exploring is whether we can reduce the current overcapacity in our ship repair facilities. "Front Line First" made some inroads into the surplus capacity that exists within naval bases, but there is still some way to go to complete that process of rationalisation.

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Ship repair facilities remain an area where some surplus capacity exists. That is being tackled within the Government's programme of dockyard privatisation and clearly must similarly inform the review of the FMRO market test. Therefore, I cannot rule out future reductions in the tasks carried out at the FMRO should their absorption elsewhere represent a more economical use of resources.
Equally however, it is pure speculation to claim that the FMRO will close as a result of the review. I can say categorically that we will not seek to introduce measures affecting the FMRO that would impact adversely on the operations of the front-line ships. My hon. Friend is fully aware—as am I—of the great benefits that the FMRO brings to that operation and that stands it in very good stead.
The whole point of the exercise is to avoid that outcome at all costs. I reassure my hon. Friend that the review will take account of the fleet's needs and those of the ships' crews as well as the demands of the Department as a whole. That is why I give an undertaking today that it will be examined in a coherent and sensible manner in the round rather than in isolation.
I should also stress that one wholly possible outcome is to continue with the market test. For that very reason, we have taken pains to maintain the process of preparing the invitation to tender in order to minimise any delay to the overall market-test timetable should the review confirm the validity of proceeding with it. I am satisfied that our dialogue with interested private sector companies will not suffer unduly during that period of uncertainty. They fully understand the pressures that have led to the situation.
I have heard claims that the review of the FMRO is designed to displace ship repair work from Portsmouth so that it can be given to the royal dockyards to bolster the Government's privatisation programme, as my hon. Friend suggests. I have also seen media speculation that the review now under way is part of a concerted effort to undermine the naval presence at Portsmouth. I would like to take this opportunity to dispel those rumours as totally unfounded.
Taking the claims in turn, the sale of the royal dockyards is proceeding as an entirely separate matter. Negotiations with the companies currently managing both yards are not assuming that any work whatsoever will transfer from the FMRO to either Rosyth or Devonport. It is equally absurd to conclude that the review of the FMRO heralds the beginning of the end for the naval
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base. I recognise local concern about the recent decision which I announced during the defence debate last month to base HMS Ocean and the future amphibious ships at Devonport rather than at Portsmouth. However, I assure my hon. Friend that there is no connection between that decision and the review of the FMRO market test. The review has no remit to address current base-porting arrangements.
The fact is that Portsmouth is currently home to some 58 per cent. of the surface fleet of the Royal Navy—we need no further evidence of the Royal Navy's complete commitment to, and dependence on, Portsmouth as a key operational and support centre. I have also heard suggestions that, rather than review the FMRO, the Government should look again at the royal dockyards to seek efficiencies there. That task is already in hand within the context of the dockyard privatisation programme.
The Government's policy on ship refits is quite clear and requires both dockyards to provide effective competition and value for money into the future. The process of dockyard sale will prove to be the mechanism for delivering efficiencies within the dockyards and reducing costs to the MOD.
In summary, I make it clear that, in deciding whether to market-test the FMRO, we will take full account of the factors raised by both of my hon. Friends today. We will not adopt solutions which, while pleasing on cost grounds, fail to meet the operational needs of the Royal Navy. The FMRO currently delivers a first-class service in a thoroughly effective manner.
I cannot, however, dispel fears that the facilities and functions currently carried out by the FMRO might be affected by the review. I hope that, by setting them in the context of the financial and operational imperatives that obtain, I have at least allayed the worst suspicions and made it clear that our minds are truly and genuinely open.
There is certainly no hidden agenda or preconceived view that the market test should not proceed. As my hon. Friend rightly said, it behoves us to be prudent in committing the Department to courses of action which may not represent best value for money. That is the sole rationale behind the review.
I have listened carefully to my hon. Friend and undertake to keep him closely in touch with developments. Once again, I warmly congratulate him on securing a debate on an important asset not only to the Royal Navy, but clearly to Portsmouth and the wider community. I congratulate those who work in the FMRO. I am extremely grateful to them and I congratulate my hon. Friend on raising the matter.

Breast Cancer
1.30 pm
Mr. Jeremy Corbyn: I am pleased to raise a subject that many Members are keen to debate—I took part in a similar debate earlier this year. An early-day motion tabled by a Liberal Democrat Member, which has all-party support, seeks compensation for women who suffer the terrible effects of radiotherapy damage and the permanent pain and injury that accompanies it.
On 15 February this year, a debate on breast cancer services was initiated by my hon. Friend the Member for Edinburgh, Leith (Mr. Chisholm). He informed the House about a petition of more than 200,000 signatures from Scotland alone about the need for better treatment. That debate referred to the work of the all-party group on breast cancer, which demonstrates that, unfortunately, one in 12 women in Britain are likely to suffer breast cancer and only 40 per cent. will be able to see a specialist oncologist.
Although today's debate deals with compensation, the wider issue of accessibility to quality diagnosis and treatment of breast cancer is particularly important. I quote from the reply to the debate on 15 February by the Under-Secretary of State for Health, the hon. Member for Bolton, West (Mr. Sackville), who, in reply to the hon. Member for Colchester, North (Mr. Jenkin), mentioned the
"damage unwittingly done through the use of excessive radiation on treatment. I assure him that there are initiatives to minimise the risk of any further slip in quality assurance and plans are in hand to ensure that all radiation units are subject to the strictest guidelines so that the unnecessary and disastrous damage to which he referred cannot occur in future."
Later in his speech, he said:
"It is well known that too many cancer sufferers, especially women with breast cancer, are not diagnosed swiftly enough. They are not seen sufficiently quickly by people with the appropriate level of expertise, which means that treatment can be delayed. Whatever the clinical effect of waiting for diagnosis and then waiting for treatment may be—it can be serious—the emotional effect is clearly considerable and we need to take action."—[Official Report, 15 February 1995; Vol. 254, c. 953–54.]
I assure the House that we shall return to that issue in future.
The figures relating to people suffering from breast cancer are truly horrendous: 25,000 cases per year are diagnosed and 15,000 die—or 300 deaths a week. Britain has one of the highest death rates in the world from breast cancer and one of the highest occurrences of that disease. The incidence rate is much lower in other countries. There many reasons for that and there is not sufficient time to discuss them today, but they need to be studied.
The treatment has been described as a lottery. I have been trying to raise this subject because of the serious problems faced by hundreds of women in Britain who suffer from permanent, progressive and disabling injuries after radiotherapy treatment for breast cancer.
The issue is not new. The Select Committee on Health examined it in detail in its report on breast cancer. I recommend that the Minister rereads the evidence taken on 30 March from Radiotherapy Action Group Exposure and the very thorough memo that RAGE drafted for the Select Committee on 15 January, setting out its aims and objectives and what it saw as the way forward.
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Since its invention, the dangers of radiotherapy have been fully recorded and recognised, yet hundreds of women have been treated without informed consent or warning of its dangers. It is routinely prescribed, often without consultation and purely as a precautionary treatment. There is very little recognition in the medical profession of the true extent of the injuries caused by radiotherapy.
RAGE helped me a great deal in preparing the debate, and I pay the strongest possible tribute to that organisation for its work and for the hope that it has given many of its members and supporters round the country. It was formed in July 1991 and aims
"To identify sufferers, collectively record their particular circumstances and draw attention widely to their injuries."
It lists as its objectives:
"To seek independent inquiry. To seek remedial action, including compensation. To urge the upgrading of radiotherapy practice and seek national quality standards. To provide support."
It is doing that extremely well.
The work of RAGE took off as a result of the withdrawal at trial of Lady Ironside's High Court action for medical negligence. A handful of the victims met to discuss the situation and it immediately became apparent that there was a common pattern of injury among them. While RAGE cannot pretend to represent every woman who has ever had radiotherapy treatment or every sufferer from breast cancer, it certainly has a large membership and wide support, so it represents an authentic voice of people who are suffering because of such treatment.
There is something seriously and unaccountably wrong with the radiotherapy treatment techniques and procedures being applied in the United Kingdom. All the work of RAGE has been done by women in constant and dreadful nerve pain, whose personal and professional lives have been shattered. Some members of RAGE have had their limbs amputated and almost all have been left with only one usable arm. For the rest of their lives, in addition to being under the cloud of the possible recurrence of cancer, they will become progressively disabled.
I find it a humbling experience to talk to victims of breast cancer for whom, although their cancer has been treated, the permanent damage and injury and the constant pain means that they may never get a night's sleep or a day free from pain for the rest of their lives. As a man, I find their plight hard to contemplate. I am sure that many women will understand what I am saying and the requests that I am making today.
The Government should give urgent consideration to what is happening to those women and to giving them the compensation that they so desperately need and deserve. It is not just my view, but one shared by Professor Karol Sikora, professor of clinical oncology at Hammersmith hospital and a leading pioneer in the fight against breast cancer.
The members of RAGE have all contracted breast cancer and have experience of the treatment protocol and of receiving radiotherapy treatment of the brachialplexus at one of the 53 treatment centres in the United Kingdom, as it is invariably prescribed as a precautionary measure following surgery. While the women, as patients, were generally made aware of the temporary nature of the side effects such as sickness and nausea, they were not made aware of the risk of serious and permanent injury involving arm paralysis and other disabling consequential effects that have been identified.

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The Department of Health should look seriously at the facilities that are made available to support people going through the treatment process. While consultants and doctors give medical advice and try to explain the possible effects, there is a need for women who are feeling desperately anxious and often isolated to receive that advice in a supportive environment. Unfortunately, that does not often happen. The debate earlier this year drew attention to the lack of specialist centres and the fact that many women are misdiagnosed because there is not sufficient expertise in all areas of the medical profession. The Minister conceded that point.
Some of the consequential effects are lymphoedema, lung burn leading to severe breathing difficulties, deadened bones—often leading to spontaneous fracture—heart damage, jaw bone pain, amputation of an arm as a last resort, skin burn and psoriasis. The onset of injury has occurred as long as 20 years after the treatment.
I hope that the Minister will listen to this carefully. It is important that the information collected by RAGE shows that there are clusters of cases at certain hospitals in certain years. In some hospitals, they coincided with a cost-cutting exercise to treat more women in the same time scale. Women were treated in 15 fractions instead of 25 to 30 fractions, thus enabling doctors to treat twice as many patients. Many RAGE members sustained injuries while being treated in 30 fractions. British hospitals use higher doses per fraction compared with other European countries and the USA. The records show a higher recovery rate, and that would be justified.
Britain's record of deaths from breast cancer is among the most horrifying in the world. In the United States, the issue has been taken seriously. A committee was already established, and President Clinton convened a special conference to examine the issue and the problems faced by women throughout the United States. We also must acknowledge the need for serious examination.
The marked clustering of injured women in certain hospitals in certain years—while other centres have experienced no cases—seems to suggest faulty protocols, inevitably at the cluster hospitals. Injury does not have to be inevitable. It is also worrying that the number of radiotherapy injuries after breast cancer reported to RAGE have increased, not declined, in recent years. The lack of a national reporting system makes it difficult to see the total picture. The Government have sought to dismiss the increase in notifications, claiming that it can be attributed to more women learning of the existence of RAGE. That may be so, but if there were national analysis and reporting, that argument would disappear. I ask the Minister to consider establishing such a system as a matter of urgency.
It is often said that it is difficult to identify causation, but that is not necessarily so. RAGE's work in increasing awareness of radiotherapy injuries has led to causation being unequivocally identified and admitted in the majority of cases. The Government's present position is that victims must seek compensation through the courts. Replying to Lorna Patch of RAGE on 7 August, the Minister stated, on compensation:
"I can only repeat that the Government's position remains that the basis for seeking compensation is by proof of negligence through the courts."
That is unacceptable, because one must be very rich to pursue compensation that way. It costs around £200,000 to mount an effective case to prove medical negligence in
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the High Court, which is totally beyond the means of almost everyone in this country. It would certainly be beyond the means of an individual who has suffered as a result of breast cancer, lost her income and, more importantly, forgone any prospect of future income. The individual might try to obtain legal aid, but there is a legal threshold of the probability of success and one must also pass a poverty threshold. The Government must instead produce a compensation package.
The injurious effects of altering the time dose fractionation plan were known to practitioners as early as 1966–29 years ago. The alteration continued at the Royal Marsden hospital until as late as 1982, 16 years after its injurious effects were first known, as a measure to increase productivity. RAGE members to whom I have spoken—and this comes through in all their documentation—had no prior warning before radiotherapy of the risk of permanent injury. As a result of such injury, entitlement to statutory benefits and state pensions has often been eroded, exacerbated by lack of Department of Social Security recognition of the type of injuries.
The compensation package suggested by RAGE—which I and a large number of hon. Members in all parts of the House endorse—is an annual figure for extra expenses, such as splints, slings, medication and hospital transportation; a sum to cover the net cost to date, net of any disability benefit or attendance allowance; and a payment to cover loss of earnings to date and to retirement. Victims can be women of all ages and classes. Many of them may have been in high-paid jobs, while others might have looked for career development and additional qualifications that would have improved their life style—and that potential has been cut by the inability to pursue their career.
Those calculations, however, take no account of the constant, nagging pain that victims suffer and their inability to lead a normal life and to pursue ordinary leisure pursuits. Where the loss of an arm is involved, the victim is unable even to pick up her child or grandchild—something that the rest of the population takes for granted as normal behaviour. Loss of mobility is an important factor.
The Department of Health is about to publish an audit conducted by the Royal College of Radiologists on the practices of its own members, to establish how such injuries occurred. RAGE was denied an independent, multidisciplinary inquiry. I hope that the audit will go some way to supporting the arguments constantly made on causation and for proper compensation. There is strong support for an independent inquiry that is not dominated by the medical profession, but takes evidence from its members—in the way that a Select Committee does.
We should be concerned to study the causes of breast cancer in Britain and why the incidence is so high, examine facilities for diagnoses and treatment, and look at increasing and making more readily available specialist treatment centres so that breast cancer can be detected earlier and be properly treated. We should ensure also that women who receive radiotherapy are made fully aware of what it involves, the dangers and possible side effects, which may not appear for many years.
We should also acknowledge the dreadful damage done to many women by mistakes, misdosage and a failure to explain possible after effects. The least we can do is to

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ensure that women who have suffered so grievously in the past receive proper compensation, ensure that such suffering does not recur and try to conquer that awful illness.
1.46 pm
The Parliamentary Under-Secretary of State for Health (Mr. Tom Sackville): I am grateful to the hon. Member for Islington, North (Mr. Corbyn) for bringing the issue to the attention of the House. I want to express my deepest sympathy to the women who have suffered side effects as a result of radiotherapy for breast cancer. I know that they can endure severe, debilitating pain and even bone fractures, as the hon. Gentleman said. In some cases, the injury to the arm is such that the women cannot continue their careers or undertake ordinary daily tasks without help. We must aim at discovering the reason for those strong reactions to treatment that, for most women, is effective and has few long-term side effects.
Radiotherapy dose and treatment techniques are determined by the clinician in charge. However, all patients have a right to consent to or reject treatment, and all are entitled to a clear explanation of any treatment proposed—including of any risks and alternatives. All treatments carry some risk, and patients must be allowed to decide whether they wish to continue with the treatment proposed. That important principle has been highlighted in the patients charter and it is departmental policy.
Any health professional will take any steps possible to avoid adverse effects, and significant cases are published so that all doctors may learn lessons from them. It is important to define factors that cause adverse effects in particular patients so that they may be avoided. It is possible that, in future, research will allow a patient's sensitivity to radiation to be assessed before treatment, to allow the treatment to be individually tailored. Unfortunately, adverse effects from radiotherapy are frequently incurable because the effect on the tissue cannot be reversed by surgery. The effects of radiotherapy are drastic because that is the nature of the treatment: it is designed to kill tumour cells and in doing so will kill a proportion of normal cells as well.
As the hon. Gentleman knows, representatives from RAGE Breast, the organisation representing many of the women suffering severe side effects, met Lady Cumberlege and the Department's chief medical officer last year to discuss the concerns of their members. Following the meeting, discussions took place between the Department of Health, the Royal College of Radiologists and RAGE at which it was agreed that the royal college would undertake a confidential clinical review of consenting RAGE members, funded by the Department of Health.
The aim of the review was to discover what common factors in treatment may have lead to these women suffering such effects. It is a relatively homogenous group and we hope that the audit will yield useful information about common factors in treatment that might have led to the adverse effects. Armed with this information, we can then assess the need for further studies.
Two hundred and forty-nine patients—all of whom are now members of RAGE—treated at 15 centres in the 14 years between 1980 and 1993 were invited to
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participate; 126 consented to do so. A conservative estimate of the total number of patients receiving radiotherapy for breast cancer at these centres over the same period is 65,000. The clinical review has now been completed and the report will be published on 6 December. Following that, each participating RAGE member will receive a personalised assessment of his or her case.
At the behest of the Department of Health, the Royal College of Radiologists has developed guidelines for the care of women who have suffered tissue damage following radiotherapy for breast cancer. They were sent to the NHS in October this year. Additionally, the Department has funded the production of factsheets—prepared by the cancer charity BACUP and other charities—for women about to undergo radiotherapy, and for women experiencing short and long-term effects following it.
As for quality assurance systems, the ionising radiation regulations are intended to prevent unnecessary or excessive exposures to medical radiation. The Secretary of State's inspectorate investigates cases of suspected breach. There are four inspectors who are Department of Health officials. The introduction of dose-reducing strategies continues and is part of a thrust to reduce radiation doses to as low as reasonably practicable in order to achieve the required diagnostic or therapeutic purpose.
Guidance notes for the protection of persons against ionising radiations arising from medical or dental use were issued in 1988. In July 1991, guidance was issued to health authorities on quality assurance in radiotherapy. It sets out 18 requirements to be satisfied to ensure that quality is maintained. The guidance has been considered in two sites—the Bristol oncology centre and the Christie hospital in Manchester. Both centres completed their assessments, and their findings were disseminated by way of a document called "Quality Assurance in Radiotherapy", which I launched at a conference in May last year. The document will act as a quality assurance model for the wider NHS; it will be for each radiotherapy department to produce a quality manual showing how the requirements of the guidance are to be met and detailing procedures in the department.
I fully realise that many of the women suffering side effects would wish to have their injuries recognised and consideration given to their claims for compensation, commensurate with their injuries. It is important to be clear about how such claims are pursued. First, we believe it right that people harmed in the course of clinical treatment should be able to seek compensation through the usual legal process. But that does require them to demonstrate not only that they have been harmed but that there has been negligence, and that the negligence caused the harm. When negligence cannot be shown, there is no case in law for compensation.
From time to time it has been suggested that this is not right, and there have often been calls for the introduction of a system of no-fault compensation. Hon. Members will recall that this issue has been considered in the House before, most recently on Second Reading of the National Health Service (Compensation) Bill on 1 February 1991. On that occasion, as on every other when the issue has been raised, the House concurred with the view that a no-fault compensation scheme would not be helpful.
Perhaps I should remind the House of the reasons for that conclusion. We are sensitive to the fact that some of the victims of medical accidents oppose no-fault

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compensation on the ground that it would make it less likely that plaintiffs' non-financial concerns would be addressed. Many plaintiffs argue that their motivation for pursuing a claim is not to secure money but to obtain an explanation and an apology and to ensure that what happened to them does not subsequently happen to others. Thus a system designed mainly to deal quickly with the financial aspects of medical accidents, without regard to fault, would deflect attention from plaintiffs' most important concerns.
Another issue is accountability. Our legal system holds all individuals accountable for their actions, which arguably has a deterrent effect on malpractice. No-fault compensation could remove or weaken it.
We must also be mindful of the possible cost implications of a no-fault compensation scheme. Costs falling on the NHS could increase greatly. For instance, a scheme in New Zealand which covers accidents generally is thought to cost at least 1.5 per cent. of its gross national product. Given that we spend about 6 per cent. of our GDP on health, hon. Members can imagine the possible impact on our health budget.
Proponents of no-fault compensation have yet to show why compensation in health care should be regarded as essentially different from negligence and compensation in other walks of life, where claims are resolved through the usual legal process.
Finally—
Mrs. Maria Fyfe: I am sorry that the Minister seems to be approaching the end of his speech because I had hoped to hear a quick word about the sums devoted to research into breast cancer, and the efforts to detect it in women under the age of 50. He probably knows that current mammography methods are not suitable for women under 50, who are clearly an important group.
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The Minister has expressed his worries about NHS budgets. Clearly, if enough money were spent on research in the first place, fewer women would suffer from breast cancer.
Finally, it would seem from the Minister's argument that only women with money in the bank will be able to claim compensation at all.
Mr. Sackville: Although I have outlined some of the reasons why no-fault compensation has been thought inappropriate, we have recently accepted that a system should be tried for mediation in such cases. The Minister of State recently agreed to set up pilot mediation schemes that may make it easier to reach agreement. We have no wish gratuitously to defend certain cases or to cause any unnecessary delays.
The Calman review was set up precisely to ensure that best examples of cancer treatment in this country should be disseminated throughout the system. In particular, we should ensure that more patients see specialists and that those with rare or difficult-to-treat cancers do not always end up in local cancer departments. They should be referred to tertiary specialist cancer centres, possibly on a regional basis, so that people with the qualifications to treat cancer can diagnose and treat the more difficult cases referred to them.
Following the general agreement that we need to take such steps to improve cancer care, I hope to see more widespread best practice. I offer the House a commitment today on behalf of the NHS: we will do everything possible to ensure that accidents of this sort are avoided in the future.
It being Two o'clock, the motion for the Adjournment of the House lapsed, without Question put.
Sitting suspended, pursuant to Standing Order No. 10 (Wednesday sittings), till half-past Two o'clock.

Oral Answers to Questions
  SCOTLAND

    European Community Directives
    Mr. Steen: To ask the Secretary of State for Scotland how many statutory instruments have been passed through Parliament as a result of European Community directives in the past year. [771]
    The Parliamentary Under-Secretary of State for Scotland (Mr. George Kynoch): There are 181, of which seven extend to Scotland only.
    Mr. Steen: Is my hon. Friend aware of what is going on in his Department? Although I know that whatever he does, he does very well, the problem is that his civil servants have a penchant for gold-plating: whenever they see a directive, they have to add something to it. Directives arrive from Europe couched in very general terms, but then civil servants add to them. Will my hon. Friend tell us today that he will outlaw gold-plating, that any adding to European directives by his Department will be banned and that he will examine all the old directives that have been gold-plated and get rid of all the stuff that should not have been there in the first place?
    Mr. Kynoch: My hon. Friend is absolutely right. Scottish Office officials are instructed to check that no double-banking or gold-plating takes place.
    Mr. Canavan: Is the Minister aware of the concern about the implications of certain European Union decisions, including those contained in directives and certain decisions made by the European Court of Justice? What action do the Government intend to take in regard to the implications of the Bosman case, bearing in mind the fact that the abolition of transfer fees would threaten the financial viability of many Scottish football clubs?
    Mr. Kynoch: I am informed by my hon. Friend the Minister with responsibility for sport that the Scottish Football Association is scheduled to hold a meeting with him on that very issue.
    Mr. Gallie: My hon. Friend will be aware of the bathing water standards that operate as a consequence of a European directive, but is he aware of the time that it has taken Strathclyde region to bring bathing water standards in my constituency up to scratch? The authority has procrastinated rather than providing. There is, however, a glimmer of hope: the new West of Scotland water and sewerage authority looks set to find a solution. Does my hon. Friend welcome that?
    Mr. Kynoch: Of course I do. My hon. Friend is right to draw attention to the deficiencies of Strathclyde regional council—not just in connection with bathing water. This year it has already been very slow to react to floods with prevention measures. I am afraid that the council has let down its electors, and I look forward to seeing the new water authority doing just what my hon. Friend describes.

    Scottish Council (Development and Industry)
    Mr. Salmond: To ask the Secretary of State for Scotland when he last met representatives of the Scottish Council (Development and Industry) to discuss economic matters; and if he will make a statement. [772]
    The Secretary of State for Scotland (Mr. Michael Forsyth): I met them on 6 September. Scotland's economy is buzzing with success.
    Mr. Salmond: When the Secretary of State next buzzes along to the Scottish Council—many of whose members seem to be deserting the Unionist cause, perhaps agreeing with the Prime Minister that independence is perfectly feasible—will he discuss with its members the results of a survey that appeared in The Times last Monday? It revealed that, apart from punishing low earners, 21 Tory tax rises since the last election had cost average earners £1,000 each.
    To avoid any suggestion of who is responsible for that, and before disparaging the policies of Opposition parties, will the Secretary of State tell us how many of those 21 Tory tax rises he has personally voted for over the past three years?
    Mr. Forsyth: On the subject of surveys, the hon. Gentleman will have seen the survey by Scottish chambers of commerce showing that 0 per cent. of businesses connected with the oil industry, which he is so keen to talk about, support his party's policy on independence. As for tax rises, the hon. Gentleman supports a tartan tax for Scotland—a tax on people working in Scotland—so he has a brass neck to talk to us about tax cuts. The only party in the House that is in favour of lower taxation, and delivers it, is the Conservative party.
    Sir Hector Monro: Does my right hon. Friend remember the warm welcome and endorsement by all the Opposition parties of the Fraser of Allander report? Yet now that we have seen the report we know that only 14 per cent. of industry in Scotland would put up with the tartan tax. Are not all the Opposition's policies therefore in disarray?
    Mr. Forsyth: I entirely agree with my right hon. Friend. Indeed, I was much struck by the fact that before they had seen the survey, the leaders of the Opposition parties commended it and said how splendid it was, but that when they saw that only 14 per cent. of respondents would support a tax-raising Scottish Assembly, they started saying that they were rather concerned about the low response rate. The fact is that the businesses that responded spoke for Scotland, and it is high time that Opposition Members listened to the voices of those on whom Scotland's jobs depend.
    Mr. Wallace: I am sure that the Secretary of State and others will wish to express their congratulations on the successful creation of 3,500 jobs at Moss End through inward investment from Taiwan. Although it is estimated that those jobs will each produce 1.5 more jobs in the Scottish economy, does the right hon. Gentleman accept the figures given to several hon. Members at the Highland Park Parliamentarian of the Year lunch, which showed that for every job lost in the whisky industry in Scotland—sadly, many jobs have been lost in recent times—3.5 more jobs are lost as a result? Bearing that

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    fact in mind, what representations has the right hon. Gentleman made to the Chancellor of the Exchequer to reverse the real tartan tax of last year—the additional 26p on a bottle of whisky?
    Mr. Forsyth: I am grateful to the hon. Gentleman for drawing attention to the splendid success by Locate in Scotland in attracting new inward investment to Lanarkshire, and a stake in the new industrial revolution. It is a pity that he did not go one stage further and abandon the tartan tax, which would send elsewhere the inward investment on which we depend. As for whisky taxation, the hon. Gentleman should not tempt me to say things that I should not say, but I have made my right hon. and learned Friend the Chancellor of the Exchequer well aware of the concerns of the whisky industry. If the hon. Gentleman and his colleagues would stop calling for extra expenditure, they might have a little more credibility when they call for less taxation.
    Mr. Bill Walker: When my right hon. Friend meets the august body mentioned in the question to discuss the economy, will he remind its representatives that the estimates clearly demonstrate that Scotland, excluding the oil industry, would have an £8.1 billion deficit? Will he also tell them how Scotland benefits enormously from being part of the United Kingdom, because this Parliament has always taken that fact on board? That is why the Scots are so prosperous today.
    Mr. Forsyth: I agree that Scotland benefits from the Union. England, too, benefits from the fact that Scotland is part of the Union. My hon. Friend is right to draw attention to the fact that if the nationalists had their way we should have to fund a structural deficit of about 15 per cent., or £8.1 billion—that is an independent figure. The deficit could be funded only by higher taxation—including taxation on whisky—by higher borrowing or by higher inflation, and I suspect that all three would be used. Most people want nothing whatever to do with such an assault on our standards of living, or with the destruction of our vital public services, which would be the consequence of going down the independence road.
    Mr. George Robertson: Will the Secretary of State accept from me the fact that when he meets the Scottish Council (Development and Industry) it will certainly not accept his propagandist interpretation of the survey by Scottish chambers of commerce? Despite a sustained campaign of smears, distortions, accusations and downright lies about devolution, there has been a decisive swing in the Scottish business community towards the idea of a devolved Scottish Parliament. Will the right hon. Gentleman not accept that fact now? Whereas 67 per cent. of the business community supported the status quo in 1991—the Secretary of State still does—88 per cent. of those who responded to the poll were against the status quo, with only 9 per cent. on the right hon. Gentleman's side. When will he recognise that he is wrong and that business opinion now realises that devolution will be good for Scotland, for Britain and for Scottish business? Will he change his mind before it is too late?
    Mr. Forsyth: The hon. Gentleman is beginning to sound rattled. He claims that his position has been distorted, but when he was invited to speak for himself on "On the Record", he spent 20 minutes failing to answer
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    the West Lothian question, which his hon. Friend the Member for Linlithgow (Mr. Dalyell) asked all those years ago.

    Public Expenditure
    Mr. Harry Greenway: To ask the Secretary of State for Scotland how much public money per capita is spent on grants and all other public expenditures in Scotland; what is the percentage difference between these figures and those for Northern Ireland, Wales and England; and if he will make a statement. [773]
    Mr. Michael Forsyth: The answer is £4,185, 12 per cent. less, 7 per cent. more and 21 per cent. more respectively. Scotland gets a good deal from the Union.
    Mr. Greenway: Does my right hon. Friend agree that it is remarkable that Scotland does so much better on public funding than England and Wales? Is it not naive of the Labour and Liberal parties to expect that high funding to continue, to expect to be allowed tax-lowering and tax-raising powers and to expect Englishmen and Welshmen to pay for that?
    Mr. Forsyth: I agree with my hon. Friend—as the public expenditure round has been completed, it is safe for me to do so. I am not sure whether many people down here realise that Opposition Members are going around Scotland arguing that Members of a Westminster Parliament would vote for more money for a Scottish Parliament than they would vote for their own constituencies, and that a Scottish Parliament could use its powers under a tartan tax to lower taxation to less than in England. It is simply not credible, and it provides no basis on which to have a stable relationship within the Union. It is laughable in terms of its prospects, and it would be deeply damaging to Scotland's economic interests and public services.
    Dr. Godman: What about the illegal acquisition of grants? Will the Secretary of State confirm that the £600,000 paid to Tate and Lyle in regional selective assistance grants was obtained illegally under European Union law? Was it a case of collusion by Scottish Office officials in these transactions, or—more probably—were they acting in a state of what might be called justifiable ignorance? What is the right hon. Gentleman doing to ensure that the money is repaid to the Treasury or, better still, given to Inverclyde district council, which will have to pick up the pieces?
    Mr. Forsyth: If the hon. Gentleman has a complaint to make about regional selective assistance and how it is paid, there is a proper way to make it: he should write to me, and I shall certainly look into any complaint. He will know that we have been able to provide substantial regional selective assistance, which is one of the reasons why 3,300 new jobs are being created in Lanarkshire and why two major job-creation prospects have emerged in Scotland in recent days. He will know that we can try to replace the jobs that, sadly, were lost at Tate and Lyle in Greenock by attracting more inward investment. I hope that he will distance himself from his party's adherence to a tartan tax, which would destroy jobs and scare away inward investment.
    Mr. Jenkin: Does my right hon. Friend recall Bob Boothby's maxim:
    "Without Scotland, England is sunk"?

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    Will he take it from me that the extra money that English Members of Parliament commit to the Scottish economy is money extremely well spent and is a price well worth paying to maintain Scotland's prosperity within a single United Kingdom currency?
    Mr. Forsyth: I agree. We are one United Kingdom, but Opposition Members wish to disturb that relationship—and in a way that would be to Scotland's disadvantage.

    Forth Bridge
    Mr. Darling: To ask the Secretary of State for Scotland when he expects to announce the date and terms of reference of the inquiry into the second Forth road bridge crossing at Queensferry. [774]
    The Minister of State, Scottish Office (Lord James Douglas-Hamilton): My right hon. Friend and I recently met Councillors Eric Milligan and Robert Gough and other representatives from Fife and Lothian regional councils. We agreed to examine together proposals for traffic management on and around the Forth road bridge. Once these discussions have concluded, we shall be in a position to announce our proposals.
    Mr. Darling: Do the Government still want to proceed with the building of a second Forth road bridge, which would devastate the constituency that the Minister seeks to represent at the next election? Have the Government changed their tack? Do they now accept that there needs to be a co-ordinated public transport strategy to deal with the transport needs of Edinburgh and south-east Scotland? Will the Minister make the Government's position clear so that we know whether they want to build this ridiculous bridge?
    Lord James Douglas-Hamilton: I can say quite clearly that we are in favour of a medium-term strategy. We have discussed that very fully with Councillor Eric Milligan. I strongly recommend that the hon. Gentleman has discussions with him, because we have reached an agreement on the subjects on which we can go forward with consensus. The subjects cover many issues, such as the new Halbeath bridge junctions in Fife and improvements to the railways. Various electronic tolling measures have also been considered. I am pleased to see that Fife and Lothian share our view and that they will work together on this. We cannot rule out the important role that a new bridge might play in the longer term, but it is premature to proceed further at this stage.
    Mr. Menzies Campbell: If there is a public inquiry into a second Forth road bridge, will the inquiry's reporter be entitled to look at Government policy and, in particular, to consider the comparative advantages of road transport or a much better system of public transport?
    Lord James Douglas-Hamilton: I have already said that we are going ahead with a medium-term strategy, which includes very substantial improvements to public transport strategy, such as park-and-ride schemes and bus lanes. It would be premature to hold a public local inquiry; many measures must be put in place by agreement. We are not going to forget the interests of those who live in Fife and in the north of Scotland.

    Munitions Dumping (South-west Scotland)
    Ms Roseanna Cunningham: To ask the Secretary of State for Scotland what was the Scottish Office response to environmental concerns arising from munitions dumping in the south-west of Scotland; and if he will make a statement. [775]
    The Parliamentary Under-Secretary of State for Scotland (Mr. Raymond S. Robertson): The Scottish Office contributed fully to the emergency services' excellent response in dealing with the phosphorous devices. It has provided data on materials deposited under licence in the Irish sea and recently brought forward its planned marine survey of the Beaufort's dyke area.
    Ms Cunningham: As the Ministry of Defence has admitted that many of the relevant munitions dumping records have been destroyed, does the Minister agree that it is enormously important to know that there is at least one individual—former Army Captain Buchan of Peterhead—who was directly involved in the dumping in the 1940s? Will he outline what arrangements the Scottish Office is making to interview Mr. Buchan to establish the extent of his direct information and to establish whether there are others in his position? If such arrangements are not being made, will he explain why not?
    Mr. Robertson: It is unfortunate for the hon. Lady's understanding of the issue that neither she nor any of her hon. Friends were present in the Chamber when we last debated this issue last Wednesday. The Ministry of Defence's advice is that any munitions on the sea bed are potentially dangerous and should be left undisturbed. It will be for the relevant Government Departments to consider the appropriate action if the survey detects significant quantities of munitions outwith the designated dump site. I am sure that the hon. Lady will be the first to agree that we should wait until we have the results of the survey that is being undertaken before we reach any conclusions and before any Department decides what it should do.
    Mr. Donohoe: The Minister may be aware that a public inquiry has been held on the overland route of the electrical interconnector in Scotland and Northern Ireland. What has not been covered by any public inquiry is its route under the sea. Given the latest concerns in relation to the laying of British Gas's pipeline, does the Minister think that it is now time for a public inquiry about its route under the sea?
    Mr. Robertson: There is no hard evidence to substantiate any of the claims that the laying of the gas pipeline was responsible for the devices arriving on the beach: there is circumstantial evidence, but no hard evidence. We must wait until we have the results of the survey that is being undertaken. We have said—and I repeat to the House—that the results of the survey will be published in full when we have them.
    Mrs. Ray Michie: In that connection, which Department will be responsible if compensation has to be paid to somebody who was injured by one of the phosphorous devices that washed up on the beaches around the west coast of Scotland? Would it be the Scottish Office, the Department of Trade and Industry, the Ministry of Defence or, indeed, British Gas?
    Mr. Robertson: I know that the hon. Lady has pursued the issue with great vigilance because one of her

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    constituents has been injured—the only person to be injured. I understand from the Department and others that he is making good progress and we wish him well. Compensation is still being discussed and once it has been finalised I shall write to her.
    Mr. Beggs: The Minister will be aware that phosphorous incendiary devices have also been washed up on the east and north Antrim coast. May I have an assurance that the survey will be thorough and that it will examine the sea bed between the south-west Scottish coast and the east coast of Northern Ireland to protect the workers to whom the hon. Member for Cunninghame, South (Mr. Donohoe) referred, who are involved in laying the gas pipeline and who, I hope, will be involved with the interconnector when a favourable decision is made?
    Mr. Robertson: I assure the hon. Gentleman that site scar sonar and other underwater television studies are being undertaken. Sea bed sediment samples will be taken by grab-sampling equipment. The Department will be fully involved with the other relevant Departments once the results of the survey are known.
    Mrs. Liddell: As the Prime Minister has now acknowledged that the Government have got it wrong about the government of Scotland and are out of touch with Scottish public opinion, will Ministers recant the bluff and evasion that we have had on munitions dumping, and which we just heard from the Dispatch Box, and extend the technical capability of the survey and the areas to be covered by it to include all those where such dumping has taken place? May we also have an exact answer as to what the Government intend to do to protect public safety?
    Mr. Robertson: I welcome the hon. Lady to the Dispatch Box: like me, she is a new kid on the block. I will write to her and answer her questions, if she can satisfy me about what she means by bluff and evasion. There has been no bluff, and no evasion.

    Wealth Creation
    Lady Olga Maitland: To ask the Secretary of State for Scotland if he will make a statement on wealth creation in Scotland. [777]
    Mr. Kynoch: The process of wealth creation in Scotland would be severely damaged by the constitutional changes advocated by Opposition Members.
    Lady Olga Maitland: I thank my hon. Friend for his reply. Is he aware that the Scottish chamber of commerce has found that 70 per cent. of Scottish businesses are bitterly hostile to the idea of a Parliament with tax-raising powers? They know very well that that would be the death knell for Scottish investment from outside. Indeed, it would kill all the work of the past five years, when £3 billion has been invested in Scotland, creating 47,000 jobs. Is he aware that those jobs would simply head down south, which would put thousands on the dole?
    Mr. Kynoch: My hon. Friend is absolutely right and I wish that the hon. Member for Hamilton (Mr. Robertson), instead of talking to one of his colleagues on the Opposition Front Bench, would listen and realise that
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    70 per cent. of Scottish businesses have said that his tartan tax-raising Scottish Parliament is bad for them, the people of Scotland and the economy of Scotland.
    Sir Russell Johnston: Is the Minister aware that both he and his right hon. Friend the Secretary of State going on and on in a mindless way about a tartan tax, which is no more than a superficial, meaningless soundbite, should consider federal systems throughout the world, such as those in Germany, the United States and Canada, where it is possible for federal units to raise taxation and thereby stimulate wealth creation?
    Mr. Kynoch: Perhaps the hon. Gentleman should talk to his Liberal Democrat colleagues because that is not what his party advocates. It is advocating a tax-raising Parliament for Scotland. It is clear to everyone who looks at the figures on funding in Scotland that that will be bad for Scotland. Seventy per cent. of businesses in the Fraser of Allander report confirmed that it would be bad for business in Scotland.
    Mr. Stephen: Does my hon. Friend accept that people who have a job in Scotland and elsewhere in the kingdom are working harder and for longer hours than ever before and that their employers would like to take on more staff but are afraid to do so because, if they prove unsatisfactory, they might not be able to get rid of them? They are afraid that they might be taken to the cleaners under so-called employment protection legislation.
    Mr. Kynoch: My hon. Friend refers to employment practices. What is clear to the people of Scotland, and to employers in Scotland, is that the policies advocated by the Labour party—the social chapter and a national minimum wage—are, along with the tartan tax-raising Parliament, very bad news for the Scottish economy and bad news for business.
    Mr. Maxton: Instead of continuing to mouth his closed-mind attitude to devolution, why does not the Minister—and the Secretary of State—take a little time to study what has happened in the autonomous regions of Spain, in particular, which is much more like what is being proposed in Scotland? Catalonia, the Basque country and Galicia have all shown an improvement in their economic structures as a result of devolution and have not been damaged.
    Mr. Kynoch: I wish that the hon. Member would look at all the positive things that are happening in Scotland: the fact that unemployment is falling steadily—whereas in Spain I understand that it is at record levels—and that business is performing better than ever before, with record output and exports. None of this would be possible if businesses were not competitive. The hon. Gentleman should look at the success stories in Scotland and question why he wants to make it very difficult for business to continue succeeding in Scotland.
    Mr. Gallie: Has not the principle of level taxation across the United Kingdom given Scotland the opportunity to create the levels of wealth of recent times? Will that not be put in jeopardy—and the Union too—if we impose a tax on Scottish people which is not imposed across the Union as a whole?
    Mr. Kynoch: My hon. Friend is absolutely right. I am sure that nobody in Scotland wants to pay more tax than the rest of the United Kingdom. We have been discussing

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    record inward investment and the successes of last week. I question whether we would have been able to convince those companies that they should locate in Scotland if it was taxed higher than elsewhere in the United Kingdom. Quite blatantly, the Opposition parties cannot see how their tax-raising Parliament will square the books unless they either reduce services or increase taxes, and that would be bad for the people of Scotland.
    Mr. McFall: The Minister knows that the 21 Tory taxes since 1992 are the equivalent of one every seven weeks in Scotland. Can he look in the eye the 200,000 unemployed and 50,000 young people who do not have a future and tell them that they are participating in wealth creation? Like the Prime Minister and the Secretary of State for Scotland, is he not wrong on devolution, culpable on the poll tax, which wasted £2 billion, and part of a Government who have deeply scarred the Scottish economy and Scottish society? Does he not accept that the majority of Scots believe that the Government's lies on taxation render them unfit for office?
    Mr. Kynoch: I hope that the hon. Gentleman will look the people of Scotland straight in the eye and explain to them how, if he were ever to get in a position of having his tax-raising Parliament, he would justify the loss of jobs, not just from the tax-raising Parliament but from signing up to the social chapter and the national minimum wage, even though he and his party are scared to tell the people what national minimum wage he proposes. I suggest that he is scared because he knows that it will cost jobs—and dearly.

    Inward Investment
    Mr. John Marshall: To ask the Secretary of State for Scotland if he will make a statement on inward investment in Scotland. [779]
    Mr. Michael Forsyth: Scotland is enjoying record levels of inward investment.
    Mr. Marshall: I congratulate my right hon. Friend on the announcement of an additional 3,300 jobs in Lanarkshire and on the fact that Scotland has more success in attracting inward investment than any other country in western Europe. Does he believe that that success would continue if Scotland adopted a tartan tax, a national minimum wage and the social chapter and were as well run as the district of Monklands?
    Mr. Forsyth: No, I do not.
    Dr. Reid: Since everyone else has raised it, may I also say to the Secretary of State and Ministers that I am very pleased about the inward investment from Chunghwa Picture Tubes. The Minister will know that it has been a team effort running from the local development agency in Lanarkshire and local councils up to the Scottish Office. It would be churlish of me, having criticised Ministers in the past, not to give them full credit for the efforts that they have made—particularly the Minister of State—to keep me informed, and I therefore congratulate them.
    Will the Secretary of State accept that, although I say that without qualification, he must realise that a hard-headed, realistic and progressive company such as Chunghwa came here in full knowledge of all the circumstances? It cannot but have contemplated the onset
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    of a Labour Government. If anything, its coming here proves that the scare stories about Labour Governments and tartan taxes hold no water.
    Mr. Forsyth: I am grateful to the hon. Gentleman for his generous remarks and for promoting my hon. Friend the Member for Kincardine and Deeside (Mr. Kynoch) from Under-Secretary of State to Minister of State. I am sure that my right hon. Friend the Prime Minister will take account of that recommendation, given the splendid job that my hon. Friend did in attracting Chunghwa to Scotland.
    The hon. Gentleman is a fair-minded man. I should like him to use his imagination—to imagine, for a moment, a Labour Government and to imagine, for a moment, that the negotiations were going on under such a Government. Exactly what argument would he use to attract Chunghwa to Lanarkshire when the Secretary of State for Wales pointed out that if the company were to go to Wales, it would not have to pay a tartan tax? It would be a knock-out blow. In this case, it was pretty tight between us and Wales, and we won because of the conditions that we had created in Scotland. If the hon. Gentleman's party had its way, Scotland would be disadvantaged.
    Mr. Kirkwood: Will the Secretary of State accept that there are real difficulties for companies that are expanding in areas of Scotland that do not have any development assistance, and that they can be enticed outward, for disinvestment purposes, to other parts of the United Kingdom? Will he make it his business to ensure that local enterprise companies and local authorities have the wherewithal to try to get sensible arrangements in place to prevent that disinvestment?
    Mr. Forsyth: I agree with the hon. Gentleman. Indeed, I have spoken to Scottish Enterprise about the matter in the context of the borders where there is a need for us to see what we can do to generate more investment opportunities and to create more employment, especially in respect of the difficult position of textiles. I took the opportunity of a meeting, last week I think, with the Commissioner to discuss some of those points. I can assure the hon. Gentleman that I am very aware of the concern in the borders. I have asked Scottish Enterprise to discuss with the local enterprise company what more can be done to take advantage of the tremendous opportunities in the borders, of the wonderful quality of the labour force and of the environment on offer there for those who wish to invest in Scotland.
    Sir Hector Monro: Does my right hon. Friend agree that, with two notable exceptions, it seems impossible to get Opposition Members to understand the successes of Locate in Scotland during the past five years? Can my right hon. Friend spell out a little more detail about the 47,000 jobs and the 379 projects that have been created? Can he show that the trend of unemployment in Scotland has been markedly downward and is likely to continue in that direction?
    Mr. Forsyth: I would be happy to arrange for all the successes to be printed in the Official Report if my right hon. Friend would provide a question that would give me such an opportunity. I will not list the successes this afternoon in view of your strictures, Madam Speaker, to keep answers as short as possible.
    Suffice it to say that none of the successes has happened by magic. They have happened because we have created flexible labour markets and low taxation and

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    improved standards of education. All those policy achievements are important in creating jobs. If Opposition Members examine their consciences, they will find that they were on the wrong side of the argument when we made changes in our economy and in our policy.

    Housing
    Mr. Chisholm: To ask the Secretary of State for Scotland what percentage of Scottish Office expenditure was devoted to housing in (a) 1978–79 and (b) 1995–96. [780]
    Mr. Raymond S. Robertson: The figures are 15.8 per cent. and 4.3 per cent. respectively.
    Mr. Chisholm: Now that the Government have admitted that they were wrong about the government of Scotland, will they also admit that they have been wrong to cut housing expenditure year after year and to allow councils to spend less and less on house building and modernisation? Does the Minister realise that with existing resources, it will take 20 years for Edinburgh district council to complete its window replacement programme and that thousands of homes also require central heating and other improvements? Will he think of those in cold homes and those in no homes when he makes his housing decisions? Will he also lobby the Chancellor of the Exchequer for an expansion of the home energy efficiency scheme in the Budget next week so that more job-creating insulation work can be carried out?
    Mr. Robertson: The comparison that the hon. Gentleman asked for is as misleading as it is useless. Transfers of responsibility from other Whitehall Departments to the Scottish Office have significantly increased the overall size of the Scotland programme since 1978–79. As the hon. Gentleman should know, housing subsidies are now paid through the housing benefit system and 300,000 public sector houses have been sold. Both of those factors substantially affect the share of expenditure attributable to housing. The hon. Gentleman would not expect me to say anything ahead of next week's Budget.
    Mr. Matthew Banks: Given the fact that public expenditure per head of population in Scotland is 14 per cent. higher than the United Kingdom average, can my hon. Friend reaffirm his commitment to the housing sector in Scotland? Does he agree that it is vital that we continue to encourage the private rented sector, in particular housing associations, to provide high-quality, affordable housing to those in greatest need?
    Mr. Robertson: My hon. Friend is absolutely right to draw attention to the level of investment in housing, despite the fact that, since 1978–79, as I said, 300,000 public sector houses have been sold. Despite that, the allocation per house issued to local authorities for 1995–96 was higher in real terms than the equivalent figure for 1978–79. That comparison would have been better than the one about which the hon. Member for Edinburgh, Leith (Mr. Chisholm) first asked.
    Mr. Ingram: The Minister is aware of the problem affecting 264 of my constituents in East Kilbride with the identification of asbestos in houses built by the development corporation. What additional help will the 239912 L
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    Minister give to local authority or other housing agencies in East Kilbride to remove that major danger to the health of the community?
    Mr. Robertson: I am disappointed and surprised at hon. Gentleman because he has pursued this with me, and I have offered to meet with him and a delegation. I believe that that is a better way to pursue the issue than shouting at each other across the Floor.
    Mr. Welsh: Has the Minister had an opportunity to read the homeless persons charter for Scotland which outlines the desperate plight facing tens of thousands of homeless persons in our country? Applications from the homeless have risen by 175 per cent.—from 15,000 to 43,000—during the past 10 years. Why are the Government cutting the finance for housing provision in Scotland? When the need is great, the Government simply say no.
    Mr. Robertson: Like the hon. Gentleman, I welcome the publication of the charter as an expression of homeless persons' views. We recognise the need to take account of the views of the users of the homelessness service, not just the providers. I have a copy of the charter and I will study carefully the recommendations that particularly refer to the Scottish Office.

    The Union
    Mr. Jacques Arnold: To ask the Secretary of State for Scotland if he will give his current assessment of the state of the Union. [781]
    Mr. Michael Forsyth: The Union guarantees prosperity and stability. A tax-raising Parliament threatens that stability and would penalise people for working in Scotland.
    Mr. Arnold: English Members are proud to share the United Kingdom with Scotland. We have heard much today about the impact on Scottish business of a tartan tax. What would be the impact of an assembly with legislative powers, producing red tape and all kinds of controls? How would that assembly limit the ability of Scottish business to compete and to attract the investment that it has secured so well under the Government?
    Mr. Forsyth: The impact would be devastating. The Opposition complained when the poll tax was introduced into Scotland one year ahead of England. They are proposing a tartan tax that would be paid in Scotland year after year, destroying jobs and opportunities. It is a wicked proposal that would damage Scotland's interests. The sooner the Opposition abandon it, the better.
    The hon. Member for Dunfermline, East (Mr. Brown) goes round boasting that he would reduce the first band of tax to 10p in the pound. Are we to assume that in Scotland it would be 13p in the pound—or will the tartan tax be levied only on people on middle incomes while the poorest and the richest escape it? It is time that we heard from Opposition Members how it will work.
    Mr. Norman Hogg: Does the Secretary of State accept that some—I believe many—Opposition Members work for the strengthening and maintenance of the Union? Does he also accept that one way of strengthening and maintaining the Union is to have regard to public opinion in Scotland and the wishes of the people? is he aware that

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    the wishes of the people of Scotland are that we should have a Parliament in Scotland, and that his proposals, which he will present on 30 November, for a tarted-up Scottish Grand Committee fall far short of what the people of Scotland require?
    Mr. Forsyth: I am surprised at the hon. Gentleman. He is usually fair minded, and I should have expected him to have waited to read our proposals before judging them as inadequate. I happen to know that the hon. Gentleman is indeed a good Unionist, and he must find it very hard to go along with all that constitutional convention nonsense. He cannot even keep a straight face, Madam Speaker. In his heart of hearts, he knows that it will damage the Union.
    If the hon. Gentleman is able to use his influence with the Labour Front-Bench spokesmen to persuade them to abandon those ridiculous proposals, there will be three cheers on the Conservative Benches and three cheers the length and breadth of Scotland when people discover what those proposals would really mean.
    Mr. Bill Walker: Does my right hon. Friend believe that the Union would be strengthened and enhanced if all the key and important ministerial portfolios—including that of the Chief Whip—were in the hands of Scottish-based Members of Parliament? If a Parliament were proposed for Edinburgh, if a tartan tax existed and if the West Lothian question had not been tackled, does he believe that the Union would be enhanced or placed at great risk?
    Mr. Forsyth: I believe that it would damage the Union, lead to the break-up of the United Kingdom and damage Scotland's ability to argue for a good deal at Westminster.
    The office of Secretary of State for Scotland is a powerful one. The hon. Member for Hamilton (Mr. Robertson) aspires to hold it. I am sure that, if ever that day were to arrive, he would use the office to great effect. That powerful office would be lost if Opposition Members had their way. Opposition Members are sent to the House to represent the interests of their constituents. Were there a Scottish Parliament, they would have no involvement in the matters that are of most interest to their constituents at home in Scotland.
    Sir David Steel: Why are Ministers so reluctant to make comparisons with other people's unions? Has the Secretary of State noticed that this weekend, Mr. Pujol and his party won their third successive election victory in Catalonia without talk of slippery slopes, flamenco taxes or separating Barcelona from Madrid? Will the Minister please explain why what is possible and welcome in Spain is impossible in the United Kingdom?
    Mr. Forsyth: I am sure that, if the right hon. Gentleman had his way, we could replicate what they have done in Spain—increase youth unemployment to 25 per cent. While he is doing his tour of foreign examples, he might consider Canada, where the argument was that, by choosing devolution, they would prevent separatism. That has ended in division and disruption, with a marginal result, and the separatists continue to ask for more. The lesson of Canada is, "If you feed the crocodile, one day you get eaten."
    Mr. George Robertson: Does the Secretary of State agree that when the Prime Minister, no less, said last week
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    that he could understand very clearly why the Scots feel that Westminster is a long way off and that no one has any interest in them, and that that was very unattractive, that statement and that interview represented a major and significant U-turn on a 16-year-old policy by the Government of no change being required in the constitution, and was a humiliating admission of failure by the Government on those issues? Some 87 per cent. of Scots oppose the Government. What sort of special tartan Tory arrogance is it for them to say that the Scots will swallow the idea of some tinkering to the package of indifferent reforms? Does the Secretary of State realise that he and the Government are the biggest threat to the country's unity?
    Mr. Forsyth: The hon. Gentleman should learn from his experience of the chambers of commerce survey that it is wise to wait and see what is said before rubbishing or welcoming it.
    We stand on our record of giving Scotland more say over its affairs. We set up the Scottish Office and have progressively given it more and more administrative power. As my right hon. Friend the Prime Minister has made clear, we are prepared to look at ways of improving the government of Scotland.
    When we produce our proposals, the hon. Gentleman will doubtless say that they are inadequate, but they will have been thought through and they will work. We will not be in the position of the hon. Gentleman, who had to describe the West Lothian question as an anomaly, nor shall we be in the position of the Leader of the Opposition, who had to describe the funding of Scotland as an accountancy detail. It is the hon. Gentleman who puts party advantage before his patriotic duty to Scotland and the interests of his party before the Union. The Government will never do that.

    Lockerbie
    Mr. Dalyell: To ask the Secretary of State for Scotland what action he has taken following the meeting on 8 November in the Crown Office between the Lord Advocate, the Solicitor-General and the hon. Member for Linlithgow in respect of Her Majesty's Government's response to the offer of the Government of Libya to hold a trial of two Libyan nationals accused of responsibility of bombing Pan Am 103 over Lockerbie under a Scottish judge and Scottish rules of evidence. [782]
    Lord James Douglas-Hamilton: When my noble and learned Friend the Lord Advocate recently met the hon. Member, he reminded him that the position of Her Majesty's Government is that the accused should be tried before the ordinary courts having jurisdiction. The demand that the accused should be made available for trial in Scotland or the United States has been endorsed by the United Nations Security Council. Libya has previously received detailed advances from us on the fair trial and treatment of the accused and has accepted that they will get a fair trial in Scotland. There is no reason why Libya cannot now make them available for trial in Scotland.
    Mr. Dalyell: Can we be sure that certain Ministers want the truth about Lockerbie?
    Lord James Douglas-Hamilton: Yes.

    Kincardine Bridge and Bypass
    Ms Rachel Squire: To ask the Secretary of State for Scotland if he will make a statement on the replacement of the Kincardine bridge and bypass. [783]
    Lord James Douglas-Hamilton: We shall undertake public consultation in the early new year on the conclusions of the recently completed studies of the options at Kincardine. That will allow local interests to set out their views directly on the options and ensure that we can make the fastest possible progress on implementing necessary improvements.
    Ms Squire: Is the Minister finally agreeing to listen to the people of Kincardine, whose health is being damaged by traffic, noise, congestion and pollution levels equivalent to those in Greater London? Does he agree that the Kincardine bridge must be replaced by the end of this decade and is the main alternative route across the Forth for east and central Scotland? Will he clarify the timetable for the bridge's replacement and the building of a bypass and confirm that Government money has been allocated for that work to begin in the near future?
    Lord James Douglas-Hamilton: I can reassure the hon. Lady that we shall progress as fast as possible towards construction. Subject to statutory procedures and the necessary competitive processes, we should be in a position to start before the end of the century. Exhibitions are to be held in Kincardine and Alloa early in the new year. A number of routes will be shown, information will be displayed setting out their merits and the public will be invited to comment on the solutions—there will be a consultation process. After that, orders will be published. Issues such as environmental considerations have to be considered, as do those that concern local residents. We want to see progress as soon as possible.
    Mr. Connarty: It is clear from the Minister's reply that, by 2000, the bridge will be in the constituency of Falkirk, East, as the boundary commission has decided that the area on the other side of the river will be in my constituency. From working with my hon. Friends the Members for Dunfermline, West (Ms Squire) and for Clackmannan (Mr. O'Neill), I know that we are trying to obtain the best solution for people on both sides of the river. Much of the traffic that crosses the bridge is generated from Grangemouth and we want the Government to come forward with the money soon. It is not good enough to say that action will be taken in 2000. As my hon. Friend the Member for Dunfermline, West said, people in Kincardine have suffered for 20 years.
    Lord James Douglas-Hamilton: The Scottish Office will publish the statutory orders for its preferred scheme around the end of 1996. The precise date will depend on public responses to the exhibition, but we intend to make the fastest possible progress. The hon. Gentleman should not anticipate the results of future elections any more than the rest of us, but I note his interest in the matter.

    Historic Buildings
    Mr. Gordon Prentice: To ask the Secretary of State for Scotland what measures he will take to ensure the structure and fabric of historic buildings in Scotland is properly preserved. [784]
    Lord James Douglas-Hamilton: Owners of historic buildings are responsible for the maintenance of their own property. We provide advice, encouragement and financial support.
    Mr. Prentice: That is simply not good enough. I do not think that the Minister has read the latest report of the Historic Buildings Council for Scotland, which says that shoddy, synthetic and often imported materials are being used to restore Scotland's built heritage. That is not good enough. Will the Minister take steps to reopen some of the traditional slate and stone quarries so that those materials can be used to restore Scotland's historic buildings? Scotland's heritage is being compromised by the Government's policies.
    Lord James Douglas-Hamilton: I can reassure the hon. Gentleman that Historic Scotland is building up the necessary expertise in Scotland. We must learn some ideas from overseas, but I assure him that we are concentrating on employing people in Scotland. The hon. Gentleman's old school, George Heriot's in Edinburgh, has benefited considerably from building repair grants totalling £185,000. If he wishes to assist his old school, he should remind his colleagues on the Opposition Front Bench that 244 of its pupils benefit from the assisted places scheme and would like to see it continue.
    Mr. Jessel: As Scotland's heritage of historic buildings is world famous and a prime tourist attraction, will my hon. Friend join me in welcoming substantial new funds from the national lottery to protect Scotland's heritage? The lottery is a brilliant achievement of the Conservative Government.
    Lord James Douglas-Hamilton: The lottery has achieved results out of all proportion to what was anticipated initially. We believe that it will be of enormous benefit not only to our built heritage, but to many charities and small organisations throughout Scotland.
    Mr. Wilson: Will the Minister approach Historic Scotland about the regrettable absence of any physical memorial in Scotland to the poll tax, given that it was possibly one of the most costly exercises in Scotland since the Darien scheme? I suggest that a derelict public toilet in Stirling could be adapted for the purpose. Perhaps a plaque on the wall might refer to the fact that the last time that the local Member of Parliament engaged in a bit of phrase-making and dubbed a Labour proposal the "roof tax", the Tory party adopted the proposal within three months.
    Lord James Douglas-Hamilton: I recall that the hon. Gentleman strongly opposed plans for a Scottish Assembly a few years ago. Rather than erect such a memorial, I think that our built heritage should receive greater priority.

    Local Government
    Mr. David Shaw: To ask the Secretary of State for Scotland if he will make a statement on the efficiency and effectiveness of Scottish local authorities. [785]
    Mr. Forsyth: There is considerable scope for improvement.
    Mr. Shaw: My right hon. Friend may be aware that I have just returned from giving evidence this morning to the Monklands inquiry in Scotland. He may not be aware

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    that, on departing the inquiry, the leader of the council made his usual threats, including threatening to visit me and my family. Does my right hon. Friend believe that such people should be in charge of councils in Scotland? Does he believe that the Labour party has a lot to answer for over the failings of local government in Scotland?
    Mr. Forsyth: I am sure that my hon. Friend will understand why I am not in a position to comment on his remarks. In defence of the Labour party, I am sure that it is as anxious as the Conservative party to ensure the highest standards of conduct in local government. The hon. Member for Hamilton (Mr. Robertson) welcomed the recent establishment of the 211 inquiry in respect of the North Lanarkshire authority. I think that it is important to proceed on the basis that the House is determined to ensure the highest standards in local government and that we have the means to investigate any complaints swiftly and bring any shortcomings to book. I hope that all hon. Members will consider local government or any other matter of public life on that basis.
    Mrs. Fyfe: As the Secretary of State chooses to dismiss with a wave of his hand all Scottish local government, will he join me in praising Glasgow district council's plans to eradicate dampness in 80,000 council houses? On his current plans for spending on Scottish housing, in what year does he expect to eradicate dampness in Scottish houses?
    Mr. Forsyth: I am all in favour of councils tackling damp houses and providing key services. The hon. Lady makes a gesture indicating that they need more money. I suggest that she uses what influence she has with Glasgow district council and other Labour-controlled councils to get them to spend less on chiefs and more on indians and to spend less on expensive, highly paid officials and more on the people who do the work. If they did that, we might have more effective authorities. If she could even encourage the councils concerned to go for value for money and become enabling authorities, the people who depend on their services might get a better deal.
    Mrs. Gorman: Can my right hon. Friend confirm that for every pound of tax collected in Scotland, the people who live there receive something like £2 in value? Does he agree that local government in Scotland, as well as historic houses and the building of new bridges, depends on the maintenance of the Union with the rest of the British Isles and that those strident Opposition Members who continually demand the separation of Scotland are likely to cause a great deal of loss to the people of Scotland on such projects?
    Hon. Members: What about the Skye bridge?
    Mr. Forsyth: I agree with my hon. Friend. The Skye bridge represents a considerable success for the Government. It was first promised in 1936, it was delivered by the Government and it will be toll free in 15 years unless the hon. Member for Cunninghame, North (Mr. Wilson) has his way, in which case the tolls will last for longer because he is encouraging people not to pay them.
    I wonder how many Opposition Members know that local government in Scotland receives 45 per cent. more per head in Government grant than local government in England. That is a huge additional means of support and they would put all that at risk with their proposals for a Scottish Parliament.
    Mr. Malcolm Bruce: Does the Secretary of State acknowledge that there is concern about the transition to unitary authorities in respect of how the equalisation will be carried through between high-spending and low-spending authorities? What steps will he take to ensure that there is not an unfair burden on rural authorities having to subsidise urban authorities? Will he step in and ensure that the transition is fair and just to all taxpayers in Scotland?
    Mr. Forsyth: In the spirit of partnership and co-operation with local government that I have tried to encourage since I arrived at the Scottish Office, I am attracted by the proposals of the Convention of Scottish Local Authorities to allow for the changes to be phased in so that rural areas that will suffer and those authorities that stand to gain will have the opportunity to adjust. COSLA's proposals are quite sensible as the time period will be kept to an absolute minimum and benefit will accrue to authorities that will gain immediately. I am sure that everyone will recognise it as a sensible way forward.
    Mr. McAllion: Does the Secretary of State accept that ill-tempered, ill-informed and inaccurate attacks on elected councils by the likes of the hon. Member for Dover (Mr. Shaw) serve merely to weaken an already weak Government case in Scotland, particularly when in Scotland this morning the same hon. Gentleman admitted under oath that his allegations were based on circumstantial evidence and anonymous correspondence? Would it not be better for the likes of the Secretary of State for Scotland, who currently pays chief executives of NHS trusts such as Grampian Healthcare more than £100,000 a year, to stop attacking chief executive of local authorities in Scotland who manage bigger budgets and larger work forces but are paid considerably less? If the Secretary of State is serious about working together in a spirit of co-operation to improve local government in Scotland, let us have an end to such scurrilous and unfounded attacks on Scottish local democracy, return to co-operation with local government and have a completely different relationship between central and local government in future.
    Mr. Forsyth: I am sorry that the hon. Gentleman did not exercise the discretion that I indicated would be appropriate in respect of the present 211 inquiry. As to employing highly expensive people, the hon. Gentleman might like to look at the number of directors in Glasgow compared with the NHS trusts. I believe that he will find that he is on thin ice.
    Mr. McAllion: I should like to know the number.
    Mr. Forsyth: I am happy to write to the hon. Gentleman setting out the facts and press-releasing them, and I am grateful for the opportunity to do so.
    If the hon. Gentleman is fair, he will acknowledge that some authorities are doing well and are responsible in terms of the number of people that they employ on high salaries. Other authorities seem to have lost their place. The hon. Gentleman, as a responsible person in the Labour party, should do what he can to ensure that the taxpayers' interests are protected. I recommend that the hon. Gentleman looks at what is happening and uses his influence to ensure that we get efficient local government.

Former Yugoslavia
3.30 pm
The Secretary of State for Foreign and Commonwealth Affairs (Mr. Malcolm Rilkind): With permission, Madam Speaker, I should like to make a statement on former Yugoslavia.
The conflict in former Yugoslavia is Europe's most tragic problem. Two hundred thousand people have lost their lives over the past four years, and more than 1.5 million have lost their homes. The conflict has caused suffering and destruction on a scale not seen in Europe since the second world war.
From the start, Britain has upheld the principles that internationally recognised borders must not be altered by force and that the legitimate rights of all ethnic groups must be properly protected by their Governments. We have therefore had three objectives—to save lives, to draw the parties away from the military option towards a negotiated settlement, and to prevent the spread of the conflict.
The Government warmly welcome the agreement initialled in Dayton yesterday. We applaud the work of all the negotiators. I congratulate the leaders of the parties to the Bosnia conflict, who have shown the wisdom and courage to make the hard choices and difficult compromises needed for peace. We must recall with gratitude the work of all those who laid the foundations for this achievement—notably Lord Carrington, Lord Owen, Cy Vance, Thorvald Stoltenberg, Carl Bildt and the American officials who died so tragically a few weeks ago while engaged in earlier stages of the negotiations.
The full text of the peace agreement will be placed in the Library as soon as it is available. It is a detailed and complex document. I will not attempt to describe it in detail to the House now, but I shall highlight some key elements.
The agreement maintains a single unitary Bosnian state within internationally recognised borders. There will be a central three-man presidency with representatives from each of the three ethnic groups, a Council of Ministers and a central Parliament. Underneath those central structures will be two entities—the federation and the Republika Srpska, each with substantial autonomy.
Elections for the central presidency and Parliament and for the institutions of both entities will be held within nine months of signature of the agreements. The Organisation for Security and Co-operation in Europe will supervise those elections. There are to be special arrangements for refugees and displaced persons, who will be encouraged to return and will have the option of voting where they lived before the war.
Individuals indicted for war crimes will play no part in future public life in Bosnia. The United Kingdom continues, moreover, strongly to support the work of the war crimes tribunal. We believe that persons responsible for atrocities should be tried. We look to all the states of the region to fulfil their international obligations.
Sanctions against the Federal Republic of Yugoslavia are to be suspended immediately. They will be formally lifted 10 days after free and fair elections have been held in Bosnia. There will also be a phased lifting of the arms embargo, alongside the establishment of an arms control regime.
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Territorial issues were the most difficult to settle and took the talks to the brink, but the settlement meets the contact group proposal of a 49–51 per cent. split between the Republika Srpska and the federation. That meets the crucial principle of maintaining Sarajevo as a united city—a principle that the British Government have supported throughout.
It would be foolish to underestimate the size of the task that the international community now faces. The first requirement is that the parties live up to their commitments. Unless they abide by what they have agreed, and work to make the settlement a success, the documents initialled at Dayton are just pieces of paper. The history of this conflict is one of broken agreements. Now, as never before, promises must be kept.
The international community will deploy an international force to Bosnia following signature of the agreement to supervise the withdrawal of respective armies to the agreed zones of separation. It is the wish of the parties that NATO take the lead in establishing such a force. We hope to see a number of non-NATO nations, in particular Russia, working with us in this force.
Apart from the OSCE supervision of elections, the international community must also establish an international police task force to advise and train the local police forces, and oversee the establishment of the agreed central structures. The international humanitarian agencies must meet the continuing needs of the Bosnian population and monitor the human rights of returning refugees. With the World bank in the lead at technical level, the international community must help with the task of economic reconstruction in the region: restoring infrastructure and utilities, stimulating the development of market economies, and encouraging economic interaction in the region.
We will therefore hold a peace implementation conference in London, to mobilise the international community for the tasks ahead. This conference will ensure that the military operation meshes with the civilian, and that tasks at the crucial civilian/military interface are properly handled. It will establish a co-ordination structure with a senior political figure, the high representative, at its centre. It will ensure that those supervising the elections, assisting with economic reconstruction and undertaking humanitarian tasks, will work together as part of a coherent implementation plan. It will help to pin down the parties' agreement to the details of implementation.
We must also decide nationally how we shall contribute to peace implementation in Bosnia. We expect to play a central role alongside our American and French allies in a NATO implementation force. In particular, I should emphasise that the early commitment of the substantial United States ground troop presence which the US Administration propose is a prerequisite for our participation. We expect to arrive and leave alongside our American and French allies. But we now need to study the details of the peace agreement. We must ensure that our forces would be acting in conditions of reasonable safety, that they would have the consent of the parties, and that the burden is being shared equitably among allies, before we take final decisions.
The agreement in Dayton is an historic event. An end to the brutal and tragic conflict in former Yugoslavia is now within our grasp. But we are not there yet. With the

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London peace implementation conference, and a British contribution to a peace implementation force in Bosnia, Britain will play a central role in ensuring that the agreement in Dayton is translated into a peaceful future for all the people of the region.
Mr. Robin Cook: May I begin by adding our welcome for the fact that an agreement for peace in Bosnia has been reached? We give a particularly warm welcome to the provision that Sarajevo is to be once again a united city. The courage of its citizens through three winters of Beige has been a tribute to human endurance, and it is right that they should be rewarded by its restoration as a single, multi-ethnic city.
We also welcome the Government's intention to host the forthcoming conference on the implementation of the peace agreement. I must warn the Foreign Secretary that implementing the peace accord will require as much effort and patience as achieving agreement to it in the first place. I assure him that he will have our full support for any responsible proposal to reinforce the British forces in Bosnia to assist with policing the agreement.
British troops have every right to be proud of their contribution in bringing humanitarian relief to 2 million citizens who would otherwise not have lived to witness today's peace. The nation will now want British troops to finish the job by helping to establish the peace. May I invite the Foreign Secretary to take this opportunity to appeal to the leaders of Congress to give the bipartisan support for the deployment of United States troops that is necessary to implement an agreement successfully brokered by the United States President?
The Foreign Secretary will know that the key test of the peace agreement will be whether it restores in fact, as well as in name, a single, multi-ethnic Bosnian state. Does he recognise the existence of doubts about whether the agreement provides for a lasting foundation for a united Bosnia, and provides for a Serb republic within that united Bosnia, with its own Government, citizenship and army? Can he assure us that the House is not being invited to accept a peace agreement that restores a multi-ethnic Bosnian state as a legal formality, but in practice partitions the country between ethnic groups? What guarantees are there in the agreement that the Serb territory—or, for that matter, the Croat territories—cannot secede into a greater Serbia or a greater Croatia?
As the House knows, the greatest revulsion caused by the tragedy of the former Yugoslavia arose from the practice of ethnic cleansing. We therefore welcome the Foreign Secretary's assurance that refugees will have the right to return to their homes. May I press him, however, to tell us what that commitment means in practice? What protection will be available to Muslim refugees who wish to return to Srebrenica and Zepa, which were the scene of recent massacres?
What commitment did President Tudjman give to honour the right of return of the 200,000 Serbs who fled from Krajina? They can have no confidence in their safety if those responsible for ethnic cleansing remain free. We therefore welcome and endorse the Foreign Secretary's strong commitment that those guilty of war crimes must be brought to justice before the international tribunal. There can be no reconciliation within Bosnia unless there is no immunity for the war criminals.
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This week's peace agreement was possible only because of the increased resolve that the international community recently demonstrated in retaliating against aggression and attacks on the safe areas. Had the international community shown the same resolve two years ago, tens of thousands of Bosnians might not have lost their lives, and hundreds of thousands of refugees might not have lost their homes. Until today, Bosnia has represented the failure of international intervention; now the international community has an opportunity to demonstrate that this peace agreement represents the success of such intervention. We must not fail in our resolve to take that opportunity, and to secure peace in Bosnia.
Mr. Rifkind: I thank the hon. Gentleman for his support for the work in which we are engaged, and I strongly endorse his observation that we must appeal to Congress to respond in a similarly bipartisan way. I have no doubt that British forces in Bosnia have been greatly heartened, and their morale greatly strengthened, by the knowledge that there is such a broad spectrum of support for the work that they have done in the past few years—support from hon. Members on both sides of the House. If it is clear—as I believe it will be—that that broad support will be available to them for the work of the implementation force, I believe that that will make what will inevitably be a difficult task at least easier to face. We very much hope that Congress will address the issues in a similar way.
The hon. Gentleman is right to say that there had to be doubts—that was the word that he used—about the lasting nature of a settlement of the kind that has been announced. It would be foolish to be over-optimistic about the future. We must take it step by step. We have achieved what is—in the context of the past three years—an extraordinary breakthrough, in the form of a settlement signed by the three political leaders. I believe that a degree of exhaustion helped to contribute to that. I also think it important for the Bosnia to which the three political leaders have agreed to be a unitary Bosnian state with a central presidency, incorporating representatives from each community. That will provide a better prospect of success.
The hon. Gentleman is also right to emphasise the need to ensure that the right of refugees to return is not an empty right. Of course, the next few weeks and months will show whether that can be delivered, and it must be one of the prime tasks of the international force to assist the process.
The hon. Gentleman concluded by suggesting that the past three years had been years of failure, which may now turn into success. I hope that on reflection he will reconsider the use of that term. Yes, there have been massive disappointments, but I believe that the extent to which the international community saved many hundreds of thousands of lives prevented the conflict from spreading elsewhere in the Balkans and helped to provide the framework that has led to the peace settlement. That is not only worthy in itself, but unprecedented. I can think of no comparable past conflict in which the international community has been able to achieve so much. The fact that we did not achieve nearly as much as we would all have liked is not evidence of failure; it just shows how painful and difficult the task is.
Mr. David Howell: Does my right hon. and learned Friend accept that his balanced and cautious

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assessment of the prospects for the deal is about right, and that there are many problems and difficulties still to be overcome? He talked about troops arriving and leaving. I am sure that he would accept that a great deal of cement will be needed to keep the agreement in place—and indeed, to make it work at all. That will involve a heavy and sustained commitment by NATO for a long while ahead. Does my right hon. and learned Friend feel that not only we but our American allies are committed to the long haul in terms of troop commitment which alone will ensure that the situation becomes stable again?
Mr. Rifkind: We are not contemplating a long haul in the sense that my right hon. Friend appeared to imply by his question.
Mr. Andrew Mackinlay: As in Cyprus?
Mr. Rifkind: It is important to reflect on the fact that—unlike the situation in Cyprus, which the hon. Member for Thurrock (Mr. Mackinlay) has mentioned—the implementation force is going to Bosnia after a political settlement, not instead of a political settlement, as happened in Cyprus. That has been one of the major difficulties with that island over the years. A closer parallel might be Cambodia, where an international force went in after a political settlement, helped to cement the agreement and was withdrawn after a given period.
It is part of the thinking of the international community that the NATO-led force should be very large, so as to establish its authority at an early stage. We hope that, if it succeeds in its efforts, it will be possible to scale down its size over a relatively limited period. At the moment, the planning envisages the presence of the international force for up to a year. I appreciate that, on the basis of experience, it is difficult to guarantee such a period, but I emphasise that the role of the international force is not as a permanent international military presence, but to assist the Bosnian parties in the implementation of what has been agreed and then to withdraw.
Mr. Menzies Campbell: While we congratulate the British forces on the contribution that they have made in Bosnia, does the Foreign Secretary agree that we should be slow to congratulate ourselves, as it has taken four bloody years for the international community to achieve that fragile peace? Is it not also salutary for Europe to remember that the whole-hearted military, political and diplomatic leadership of the United States was required before the peace could be achieved? Finally, if the United States cannot put troops on the ground, can NATO ever be the same again?
Mr. Rifkind: A NATO operation cannot take place without the United States; I am sure that there can be no ambiguity about that. The hon. and learned Gentleman referred to the four years that it has taken to reach this stage, but he should reflect on the fact that, if those who are fighting a war are determined to pursue that war, there is little that external countries can do unless they wish to become combatants in the conflict—not a solution that the hon. and learned Gentleman has ever advocated. Therefore, the prime responsibility for the time that it has taken for the war to come to a conclusion must lie with the combatants.
Of course, the hon. and learned Gentleman is correct to say that the necessary involvement of the United States in achieving the progress that has been made should be a
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clear indication of the insufficiency of a purely European response to a problem of that kind. Clearly the problem of Bosnia has caused concern and reactions all around the world, not only in Europe but in Islamic countries as well as in the United States. It has required an international response.
That is why, over the past couple of years, the United Kingdom, France and other western European countries have sought to persuade the United States to give its full diplomatic weight to the prospects for a negotiated settlement. We are pleased and satisfied that the United States responded to that advice, and we have gradually seen the improvements on which I am reporting today.
Sir Patrick Cormack: Notwithstanding my right hon. and learned Friend's remarks, does he accept that many people perceive that the much more united and determined approach and the true resolve that we have seen in recent months—to which my right hon. and learned Friend has made a contribution, for which I thank him—has resulted in the settlement? Does he agree that it is now essential that that resolve is maintained and that the momentum is not lost? In that context, will he tell the House when he expects the London conference to be held?
Mr. Rifkind: There are a number of reasons why we have seen progress in recent weeks, the most important of which has been the effect of the pressure on President Milosevic and his decision to break with Karadzic and Mladic and push for a political settlement. The last London conference—which led to the establishment of the rapid reaction force led by Britain and France—was important, as was the American initiative, to which I have paid tribute. We are expecting the peace implementation conference to be held in very early December, and we are discussing dates with allies and other relevant countries at present.
Mr. Tony Benn: Is the Secretary of State aware that there are other interpretations of what has happened? The break-up of Yugoslavia was brought about by the recognition of Croatia by Germany, and has been followed by the arming of Croatia by the United States, the use of massive air strikes—in which more bombs were dropped by NATO than by all of the other parties throughout the war—and the ultimatum at Dayton. Is it really the case that a NATO occupation of former Yugoslavia—for that is what is involved, with about 60,000 troops deployed to keep the peace—and the requirement to introduce a market economy constitute anything other than a very unstable future which sidelines the UN? That is one of the anxieties that many people will feel when they hear what the right hon. and learned Gentleman has said.
Mr. Rifkind: The right hon. Gentleman is not correct in his historical analysis or in his current assessment. I believe that the break-up of Yugoslavia was inevitable once Slovenia and then Croatia had decided to secede from that country. The question of recognition by other states may have had some impact on the precise consequences of that, but the break-up was inevitable for internal reasons, not external.
The right hon. Gentleman referred to the proposal as a "NATO occupation" of Bosnia. He is quite wrong in that suggestion. Part of the agreement that all three parties have signed is a desire that NATO and other countries,

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including Russia, should provide an international force to help monitor and implement the settlement. We are not going into Bosnia against the wishes of the Bosnians—quite the opposite. It is part of their request. The Bosnians recognise that, without that international force, the settlement will collapse and we will be back to the carnage that we have seen in recent times.
Sir Dudley Smith: Is my right hon. and learned Friend aware of the invaluable role played by the Western European Union in securing the blockade on the Adriatic, and—where the embargo was concerned—in policing the Danube in Hungary, Romania and Bulgaria? These countries have been helpful. Is he further aware that the WEU is ready and willing to do whatever tasks are assigned to it in the new and much more hopeful situation?
Mr. Rifkind: My hon. Friend is right. The WEU has provided useful assistance, and there may be further opportunities for the WEU to provide practical support to the efforts of the international community. That is something that we warmly welcome.
Mr. Robert N. Wareing: Does the Foreign Secretary really believe that, in a short space of time, refugees can go back to towns such as Srebrenica? Can he tell the House what is to happen to the 6,000 regular Croatian troops presently stationed in Bosnia? Will they be withdrawn? Does he honestly believe that an imposed peace can ever be a permanent peace?
Mr. Rifkind: Naturally we expect that all troops from outside Bosnia will return home in the near future, and that would apply to regular troops from countries such as Croatia. The hon. Gentleman is correct to emphasise the difficulties for refugees trying to return to areas that remain occupied by another community. That will be a difficult task in Bosnia, just as it has been difficult in many other parts of the world where there have been political settlements, but not of a form that makes the return of refugees as easy as we would wish. That will be one of the tasks to work on. I doubt whether we will achieve the success that we would like, but we must try to achieve whatever is possible in that sphere.
Mr. Michael Jopling: Does my right hon. and learned Friend agree that, following political agreement and with NATO troops on the ground, we are entering a particularly dangerous period for us all, not least because of Russian participation in the area? If the agreement, like so many others, is torn up and more fighting starts, to what extent will NATO troops be prepared to move from a peacekeeping role into a role of peace enforcement?
Mr. Rifkind: The Russian involvement so far has been helpful and valuable because it has enabled the Security Council to speak with a single voice and enabled the contact group to operate in the ways that led to the negotiated agreement announced yesterday. My right hon. Friend speculates about the possibility of the settlement disintegrating. The question that has to be asked is whether that might happen as a result of the actions of one party or as a result of the general disinclination of all the parties.
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Clearly, if one party did not fulfil its obligations, the whole weight of the international community would seek to ensure that it respected the treaties into which it had voluntarily entered. If there was a lack of will on the part of all the parties, the whole settlement would inevitably collapse and we would be back to the situation in Bosnia that we have seen in the past four years.
Mr. John D. Taylor: Although naturally we welcome the statement by the Secretary of State, we none the less share the caution that he has emphasised. We on the Ulster Unionist Bench in particular note the enthusiasm of the Secretary of State for the total exclusion from all-party talks and from any future democratic developments in Bosnia of those who during the past four years have been involved in paramilitary and terrorist activities.
The Secretary of State stressed the importance of the new central parliament and Government. Will that parliament and Government be in control of the armies within Bosnia, or will two separate armies continue to exist under separate Governments in Bosnia? Can the Secretary of State give us some guidance as to the total number of United Kingdom forces present in Bosnia under both the United Nations and NATO?
Mr. Rifkind: Those excluded from political and public life will be limited to those who are indicted as war criminals. They will not include those who come within the slightly wider definition that the right hon. Gentleman suggested. We look forward to the day when there will be a gradual reintegration of the military forces in Bosnia. That cannot happen immediately. It will take time, as it has taken in other parts of the world where similar problems have existed. We have seen in South Africa how the competing armies have been gradually integrated into a single new South African defence force. I do not say that that will happen, but it must be the objective that we work towards in Bosnia.
We are still giving consideration to the precise details of the British contribution in Bosnia. It is likely to have two elements: the forces which are currently there under UNPROFOR, which may become part of a new NATO-led force, and the headquarters of the whole NATO force provided by the allied rapid reaction corps based in Germany. Britain is a framework nation of that and, therefore, a significant proportion of headquarters manpower will be from the United Kingdom.
Mr. Jonathan Aitken: Will my right hon. and learned Friend confirm that the American War Powers Act requires clear and unambiguous congressional commitment to the proposal that a large number of American ground troops should be sent to Bosnia? Is he confident that the commitment will be given by Congress? Is he aware that there are a great many ambiguities in the statements of the American Administration, which need to be clarified? For example, Secretary of Defence William Perry has spoken of the American peacekeepers leaving within one year, which may seem to some of us a remarkably short haul. Would he confirm that, before British troops are committed, Congress must be on board for what will be a long and perilous haul?
Mr. Rifkind: I certainly confirm my right hon. Friend's final point. In my opening remarks, I said that British forces would enter and leave at the same time as United States forces. There can be no question of any

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different approach. It is for the United States Government to determine the constitutional requirements within the United States for the deployment of American forces. The President has already indicated that he intends to enter into early consultations with both Houses of Congress, and it is worth recollecting that the vote in the House of Representatives a few days ago did not reject American participation, but emphasised the need for that House to agree to such a proposition and for that case to be argued. The President has indicated that he accepts total responsibility, to ensure that American forces are deployed. We wish him well in that task and will give him our full support.
Mr. Dennis Skinner: Is the Foreign Secretary aware that, given fair wind, the treaty might last long enough to carry it beyond the American presidential elections in about a year from now and, perhaps, just beyond the British general election? Will he also comment on the fact that it is rather curious that, in this so-called peace treaty, no matter how long or temporary, as opposed to the one in Ireland, there is no talk of decommissioning; in fact, there is the opposite—there is going to be a lifting of the arms embargo? How does he manage to approve those double standards?
Mr. Rifkind: The hon. Gentleman is wrong. It is likely that arms control discussions will take place, hosted internationally, to ensure that there is a progressive reduction of military equipment within Bosnia to the amount that is reasonably required by any country in the modern world.
Mr. Nigel Forman: Is my right hon. and learned Friend aware that many Conservative Members will want him and his colleagues to keep the duration and nature of our commitment in the former Yugoslavia closely under review? Can he confirm that the likely number of British troops committed to that unfortunate territory may initially be about 13,000? Can he tell the House, more clearly than he has been able to do so far, exactly what they will be doing? Will they be there in support of the civilian power? If so, which is it, and what is the parallel with the normal support for the civilian power in places such as Northern Ireland?
Mr. Rifkind: I can give my hon. Friend certain additional information. Certainly, in the first few weeks, the prime purpose of the implementation force will be to monitor the implementation of the settlement. It provides for the forces of the Bosnian federation and Republika Srpska to withdraw from the existing confrontation line and for a safety zone to be inserted between those two confrontation areas to prevent a resumption of hostilities. Part of the responsibilities of the force will be to man that area and thereby ensure that what is a ceasefire becomes a permanent peace. They will also have responsibility for much of the monitoring of what is happening in regard to the other parts of the agreement, much of which will require civilian assistance, but may also have a military component.
On the size of the British force, my hon. Friend mentioned 13,000. I would not want to be committed to a specific figure, but I do not expect it to be significantly different from that level.
Mrs. Margaret Ewing: Like other hon. Members, I welcome this step, while realising that it is
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only the beginning of what might be a long and fairly tortuous route to ensuring a lasting peace in the former Yugoslavia. With reference to the peace implementation conference, can the Secretary of State define more clearly what is meant by a high representative, because he or she, whoever the person may be, will have a critical role to play and will have to have the confidence of all the groups involved in what has been a disastrous conflict for Europe?
Will he also say whether there is any definition at this early stage of who will have the final responsibility for the establishment of the membership of that conference? Will it be the United Nations, the European Union, the United States, the North Atlantic Treaty Organisation, or the United Kingdom Government? Obviously, those details have to be worked out and may appear in the document that is to be placed in the Library, but it would be helpful if we had some ideas on that matter at this stage.
Mr. Rifkind: On the latter part of the hon. Lady's question, the last suggestion that she made was correct. It will be the United Kingdom Government, who are hosting the conference, who will issue the invitations. Clearly, we will take account of all those who have a relevant contribution to make.
The hon. Member for Moray (Mrs. Ewing) is also correct to say that the high representative will be a crucial participant in the work of the international community in Bosnia in implementing the settlement. I mentioned earlier that NATO will, of course, be leading the implementation force but NATO is a military organisation. There is a need to ensure that the political oversight and the civil co-ordination are also in the hands of someone who is responsible for these matters in a credible and effective fashion.
The high representative will be responsible for the co-ordination between the civil and military roles and for supervising the electoral process. It is quite likely that the Organisation for Security and Co-operation in Europe will have the immediate responsibility in that area but the high representative will be keeping a watchful eye on the elections that are to be held as part of the settlement and questions like the return of refugees, the economic reconstruction of Bosnia and matters of that kind will fall within his remit.
Several hon. Members rose—
Madam Speaker: Order. This is an important agreement, and I want to try to be helpful to the House and call all those Members who have heard the entire settlement statement of the Foreign Secretary. It would help me and the business to come if we could now have brisk exchanges, so that I can call all the Members concerned.
Mr. John Wilkinson: Can my right hon. Friend explain exactly how the high representative is to be chosen, what nationality he will be, how he will relate, if that is the right word, to the theatre commander of NATO, and whether the Russians will accept his authority or whether they will refer back to their national Government in anything they are called upon to do?
Mr. Rifkind: Thought is being given at the present time to both the identity and the specific tasks of the high

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representative. I think it is likely that agreement will be reached and a conclusion announced at the peace implementation conference to be held in London. Already much of the work has been done, but I think that that will enable the various threads to be drawn together. That will be one of the items on that particular agenda.
Mr. Calum Macdonald: Will the Secretary of State say something more about the status of individuals indicted for war crimes? Surely we must require more than that they are simply barred from political life. Must not the international community require that they be returned to The Hague for examination and trial for war crimes, and should it not be a requirement of any level of government in Bosnia that, in return for any political and economic assistance, they must comply with the requirements of the war crimes tribunal in The Hague?
Mr. Rifkind: We attach importance to the requirements of the war crimes tribunal being respected. The reference to participation in public life was clearly part of the political settlement announced yesterday, and it was important for it to be clarified that such persons would not be able to participate in the public life of Bosnia in future. How those persons are returned for trial is a separate but also very important issue, and will have to be addressed in its own context.
Lady Olga Maitland: Does my right hon. Friend agree that, for the peace in Bosnia to be permanent, it would need conformation to that agreement by Mr. Karadzic and General Mladic? I understand that they have been indicted for war crimes and that they will be removed from public life, but will my right hon. and learned Friend clarify exactly what their position will be, bearing in mind that there is a real danger that, if they had personal freedom to move around, they could create an insurrection behind the scenes? That is an important factor, and we should face up to the very real dangers that could emanate from their movements.
Mr. Rifkind: The starting point is that the negotiating powers on behalf of the Bosnian Serbs were given to President Milosevic. That has been one of the reasons that we have achieved the progress that has been realised. It is also important to look to the elections that will be held for the Bosnian Serbs as well as for the other communities in Bosnia and that we hope will enable a new legitimate leadership to emerge that can speak for the Bosnian Serb interest.
Mr. David Winnick: Should not the American Administration be warmly congratulated on achieving, with much difficulty, what European countries, no doubt with good will, were not able to achieve in the past four years? Is the Foreign Secretary aware that those of us who took, by and large, the Bosnian position recognise all the weaknesses—and have the reservations—rightly expressed by my hon. Friend the Member for Livingston (Mr. Cook), but believe that it is the best possible agreement that could have been reached
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in the circumstances, should be supported on the ground and deserves full support from all those who live in Bosnia?
Mr. Rifkind: I very much agree with the hon. Gentleman.
Mr. Mackinlay: Further to the Foreign Secretary's reply to the hon. Member for Carshalton and Wallington (Mr. Forman), is there not a need for clarity and precision about the role of the international forces, who are headed by a British general? Will not those forces be involved in enforcement rather than peacekeeping? Are not British soldiers going to have the unenviable task of enforcing population movements? I fully recognise that those involved will be returning refugees and that the forces will have to see that they get back. Under the terms of reference now being considered by British generals in Germany, is it not a fact that the forces will have to enforce the movements of civilian populations, if need be, at the end of a bayonet?
Mr. Rifkind: It is proposed that the NATO-led force will have extremely robust rules of engagement. The objective is to ensure that by virtue of both it size and its capability, it will be able to assist in the implementation of the settlement. That enables the rules of engagement to be significantly more robust than in the past.
Ms Angela Eagle: Will the Foreign Secretary say a bit more about the arms reduction talks? Does he agree that the worst possible scenario would be for there to be a huge increase in the buying-in of weapons in the various areas of the former Yugoslavia, for the peace then to unravel and for us to end up with an even bigger conflagration as a result of lifting sanctions too early?
Mr. Rifkind: The hon. Lady is correct; there are, indeed, dangers in the lifting of the arms embargo. For that reason, it has been agreed that the lifting of the arms embargo should be a phased process taking place over six months. It will also be an early intent to have an arms control conference, so it is the intention that there should be proper consideration of the implications for the future of military equipment and military assets within Bosnia and that conclusions can be reached on that within the six-month period. By the time, therefore, that the arms embargo may be lifted on all the parties, we shall have a much clearer picture about the implications of these matters.
Mr. Ted Rowlands: Following that point, how does one phase an arms embargo? Will it be based on the type of material or the type of equipment that will be allowed in the six months? Given that the right hon. and learned Gentleman is now saying that there will be a NATO force of 60,000, what phasing will take place?
Mr. Rifkind: The agreement envisages two phases. After three months, there should be a partial lifting of the embargo on light weapons and other such equipment, but there will still be an embargo for a further three months on artillery, heavy weapons, mines, military aircraft and other equipment of that kind. That is the phasing that is envisaged.
Mr. Harry Barnes: Is the Foreign Secretary aware that there are many decent and honest people in Serbia, Croatia and Bosnia who bravely stood out for a considerable period for peace,

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reconciliation and a multi-ethnic society? Is he aware that those people, often organised in their own small political parties and within community groups, have been sidelined until now, whereas the warlords have been considered all the time? Will the new situation give an opportunity for those people in Bosnia, such as the Tuzla Civic Forum, to find expression and to influence future developments?
Mr. Rifkind: The hon. Gentleman's remarks give added force to the need for the elections to take place at the earliest possible practical date. That will enable the wishes of the people of Bosnia to be reflected in their political leadership.
Mr. Mike Gapes: Given the difference in the timetable—nine months for elections and six months for phasing out the arms embargo—will there not be the serious problem, when the United States decides that it wishes, presumably, to arm one side of the federation against the Republika Srpska and when there is no legitimacy for a new three-person presidency, that in effect, the United States will be arming one side in a continuation of the conflict? What thought has been given to dealing with that problem?
Mr. Rifkind: The proposal is that the elections should happen not later than nine months hence. If circumstances permit earlier elections, that would clearly be highly desirable, in part for the reasons to which the hon. Gentleman has referred.

WELSH GRAND COMMITTEE
Motion made, and Question put forthwith, pursuant to Standing Order No. 98 (Welsh Grand Committee)
That the Matter of the implications of the Gracious Speech for Wales, being a Matter relating exclusively to Wales, be referred to the Welsh Grand Committee for its consideration.
That the Matter of the implications of the Budget for Wales, being a Matter relating exclusively to Wales, be referred to the Welsh Grand Committee for its consideration.—[Mr. Bates.]
Question agreed to.

BUSINESS OF THE HOUSE
Ordered,
That—
(1) Standing Order No. 13 (Arrangement of public business) shall have effect for this Session with the following modifications, namely:
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In paragraph (4) the word 'thirteen' shall be substituted for the word 'ten' in line 43; in paragraph (5) the word 'eighth' shall be substituted for the word 'seventh' in line 45;
(2) Standing Order No. 90 (Second reading committees) shall have effect for this Session with the following modification, namely:
In paragraph (2) the word 'eighth' shall be substituted for the word 'seventh' in line 23;
(3) Private Members' Bills shall have precedence over Government business on 19th and 26th January, 2nd, 9th and 16th February, 1st 8th, 22nd and 29th March, 19th and 26th April, 10th May and 12th July.—[Mr. Bates.]

SITTINGS OF THE HOUSE
Motion made, and Question put forthwith, pursuant to Standing Order No. 11A (House not to sit on certain Fridays)
That pursuant to Standing Order No. 11A (House not to sit on certain Fridays), the House shall not sit on the following Fridays:
Friday 1st December, Friday 15th December, Friday 12th January, Friday 23rd February, Friday 15th March, Friday 3rd May, Friday 24th May, Friday 14th June, Friday 28th June and Friday 5th July.—[Mr. Bates.]
Question agreed to.

DEREGULATION
Motion made, and Question put forthwith, pursuant to Standing Order No. 14A(1) (Consideration of draft deregulation orders)
That the draft Deregulation (Building Societies) Order 1995, which was laid before this House on 16th October, in the last Session of Parliament, be approved.
That the draft Deregulation (Greyhound Racing) Order 1995, which was laid before this House on 16th October, in the last Session of Parliament, be approved.—[Mr. Bates.]
Question agreed to.

Orders of the Day

  Debate on the Address
  [SIXTH DAY]
  Order read for resuming adjourned debate on Question
  That an humble Address be presented to Her Majesty as follows:—
  Most Gracious Sovereign
  We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament.—[Mr. Hurd.]
  Question again proposed.

  The Economy
  Madam Speaker: I have selected the amendment standing in the name of the Leader of the Opposition, and the amendment in the name of the leader of the Liberal Democrats will be put forthwith after 10 o'clock for Division purposes. Between the hours of 7 and 9 o'clock, I must limit speeches to 10 minutes only.
  4.14 pm
  Mr. Gordon Brown: I beg to move, as an amendment to the Address, at the end of the Question to add:
  But note Government election promises continue to be broken, with tax increases equivalent to 7p in the pound on income tax imposed to pay the costs of economic failure, with Britain having fallen from 13th to 18th in the world prosperity league since 1979, with investment worse than at this stage of previous economic cycles and living standards having fallen more sharply than for years, with widespread insecurity and one in five households of working age with no-one in work; humbly regret that the Gracious Speech excludes positive measures for jobs, productive investment and opportunities to move from welfare to work; regret the absence of action on the Greenbury Report and the boardroom excesses of the privatised monopoly utilities; regret the absence of a strategy for employment, skills, regional development and industry, including measures to raise educational standards and access to quality training, and to secure effective public-private partnership for infrastructure investment; and calls for the abandonment of rail privatisation and of the Prime Minister's pledge to abolish capital gains tax and inheritance tax.
  It is now sixteen and a half years since the Government came to power, and almost five years since the Prime Minister took office. The Loyal Address gives us the opportunity to assess where the Conservatives have taken Britain and where they are now trying to take us. Our amendment makes it clear that the economic test for the Queen's Speech and the forthcoming Budget is what the Conservatives will do to build an investment-rich economy that is equipped with skills, science, training and technology for the future, and whether the Government will take up our proposals to tackle the slowest increase in investment out of recession that we have seen this century.
  The Queen's Speech needed to, and the Budget must, tackle the job insecurity that permeates this country, and so reduce the annual billion-pound cost of unemployment. That is why we propose a windfall tax on utilities—to get people back to work. The Budget needs to reunite the nation, as the Queen's Speech should; to build social cohesion and a fairer Britain, including a fairer tax system.
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  Let us recall the central Conservative promise of 1979, the aim behind the first Loyal Address, and the objective of the first Conservative Budget. The then Chancellor, Lord Howe, said that falling behind our competitors was the issue. He said that Britain's relative decline was
  "not a prospect that I am prepared to accept."—[Official Report, 12 June 1979; Vol. 968, c. 237.]
  He said that ending that relative decline was the real challenge and the central issue, the make or break for the Conservative Government and the decisive test on which the Conservative party should be judged.
  Yet what do we find after 16 years? The Conservatives said that their whole strategy was to avoid relative decline, but that has happened. We have not risen above more competitors, as they promised; we have fallen further below them. Only a few weeks ago, the league table for national income per head showed that we are not moving upwards, but we have been moving downwards. We have not reversed that relative decline, but our decline has worsened in relation to our neighbours.
  We are 18th in the world league of national income per head. In 1979, we were in front of Italy, but we are now behind it; we were in front of Norway, but we are now behind it; we were in front of Hong Kong and Singapore, but we are now behind them. Under the Government, we have slipped from 13th to 18th. Last year, when the Chancellor said we were in a hole, he should have said that we were in the 18th hole, well behind 17 players. No wonder I regard with some trepidation the statement by the Chancellor some months ago that the task of overtaking our rivals needs the election of more Conservative Governments in the future.
  Mr. Gyles Brandreth: The hon. Gentleman mentioned job insecurity and competitiveness. He will be aware that, at the Confederation of British Industry conference last week, Sir Rocco Forte, whose company owns hotels in my constituency, spoke of the devastating effect on the competitiveness of his industry and on jobs of the minimum wage and the social chapter. Given that 16,000 of my constituents work in the hotel, retail and tourist industries, and given that a leading hotelier is saying that those policies would have a devastating effect on employment prospects, how can he continue to support those policies?
  Mr. Brown: The hon. Gentleman's speech last week was a little better than the speech that he has attempted today. I would have thought that he and Forte itself would be more concerned about the takeover bid that has been mounted. He asked about the minimum wage. Is he not interested in the fact that, of the 17 countries ahead of Britain in the world prosperity league, 15 of them have minimum wages?
  Where do I get the information about how we have slipped down the world prosperity league? [An hon. Member: "A Labour party researcher."] No, not from a Labour party researcher, as the hon. Gentleman said; not from the Trades Union Congress; not from an academic buried in a university. I obtained that information from Her Majesty's Stationery Office, from an official Government publication, a White Paper with all the authority of the Cabinet, entitled "Competitiveness: Forging Ahead".

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  The White Paper was
  "presented to Parliament by the President of the Board of Trade and the Chancellor of the Exchequer, the Secretaries of State for Transport, Environment and Employment, the Chancellor of the Duchy of Lancaster, and the Secretaries of State for Scotland, Northern Ireland, Education and Wales".
  Half the Cabinet signed that White Paper.
  As the Prime Minister said in an admiring introduction to that White Paper, it was
  "the first comprehensive … survey of Britain's competitive position against that of our leading … rivals … a hard-headed assessment of our competitive position."
  Mr. Nigel Forman: For the avoidance of doubt, will the hon. Gentleman tell the House a bit more about those figures? Will he tell the House, for example, whether they are based on purchasing power parities or current exchange rates?
  Mr. Brown: Not only can I tell the hon. Gentleman that those figures are based on purchasing power parities, but I can tell him that even the exchange rate measure gives exactly the same answer about the deterioration in our competitive position. I can tell him that the position was the same last year as this year and, according to all surveys that have been done, is likely to be the same in the current full financial year.
  It would be worth while for the hon. Gentleman to read the report. Not only have we fallen to 18th in terms of national income per head, but we have fallen to 21st in terms of investment per head—way below Spain and Portugal.
  That White Paper says that we have consistently invested a smaller proportion of national income than our competitors, that United Kingdom industrial research and development expenditure is less than that of our competitors, and that all the changes that the Conservatives say that they have brought about in the British economy come down to the fact that we have slipped, under their policies, from 13th to 18th. They should be ashamed of themselves.
  Mr. Tim Yeo: Will the hon. Gentleman give way'?
  Mr. Brown: I shall give way on the White Paper, which no doubt the hon. Gentleman has read.
  Mr. Yeo: Will the hon. Gentleman tell me how many of the 17 countries that are ahead of us devote as large a proportion of gross domestic product to the public sector as we do?
  Mr. Brown: The question, as I shall suggest to the House later, is not, "What theoretical proportion is public expenditure of national income?" but, "What is investment as a share of national income?"
  Mr. Yeo: What about answering the question?
  Mr. Brown: The hon. Gentleman knows perfectly well that in Germany, France and many other countries, public expenditure is a greater proportion of national income, and they are more prosperous than we are. He should also know that, when assessing relative prosperity, most countries would go on the direct connection between investment and gross domestic product per head.
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  What has happened to the economy after 16 years? Let us remember what was said. Do Conservatives continue to boast of the "economic miracle", as they did in 1988? Remember the boast by the then Chancellor that we had become the envy of Japan, as Japan shoots ahead of us in the economic league. Remember the claim by the present Prime Minister that there was no longer a German economic miracle, but that a British economic miracle had replaced it. Remember the proclamation that the Conservatives had transformed the British economy.
  Remember that other promise—indeed, assertion—that the pound was about to replace the deutschmark as the leading European currency, a characteristically prescient statement, made only a few weeks before we crashed out of the exchange rate mechanism. What do Conservative Members say of their economic transformation now that the pound has completed its passage and is worth 40 per cent. of the value of the deutschmark that it was worth in 1979?
  There are no more big promises; no more weasel words. The following phrases are found in the speeches of the Prime Minister and the Chancellor now. "Conditions are right," they say; "we are poised"; "the fundamentals are in place"; "we are well placed". Surely, after 16 years being poised on the brink of laying the foundations of the essential preconditions for getting the fundamentals right for being on our way to becoming the enterprise capital of Europe, that is simply not good enough. It is time to judge them on their record, not on their promises.
  The Chancellor of the Exchequer (Mr. Kenneth Clarke): The hon. Gentleman makes much of the one page of the White Paper on competitiveness that he appears to have read concerning the list of GDP per head figures, at the top of which comes Luxembourg. The method used to calculate the figures involves the assets of all the secondary banks in Luxembourg, which puts it at the top of the table. But those assets are not enjoyed by all the inhabitants of Luxembourg, and it is not an ideal measure of the most successful economy in the world.
  The hon. Gentleman appears to want to make an absurd comparison, to try to prove that the Thatcherite revolution never happened. Is he aware of the analysis in The Wall Street Journal by Mr. Marsden, an independent economic consultant, who uses World bank figures on a number of indicators that have more to do with improvements in our position? It shows that, since 1979–80, out of 16 countries, Britain is first in the list of improvements in productivity, first in reductions of tax burden, first in the increase of private consumption and overwhelmingly first in attracting foreign investment. If the hon. Gentleman studies league tables, he should use sensible ones, not misuse casual ones.
  Mr. Brown: The Chancellor now seems to think that an extract xeroxed from The Wall Street Journal is more valuable than a Government publication—a White Paper from HMSO.
  Mr. Clarke rose—
  Madam Speaker: Order. I cannot hear two hon. Members at once.
  Mr. Brown: Perhaps the Chancellor has another report to which he wants to draw our attention. Perhaps he has an extract from a Japanese daily newspaper.
  Mr. Clarke: It is not the way the hon. Gentleman reads them, but the way he tells them. He keeps misusing our White Paper on competitiveness to show it as some sort of world prosperity table. The figures refer to investment, productivity and personal consumption. He knows that the Conservative party has transformed this country for the better since 1979. We are currently well ahead of the league in our recovery from the recession.
  Mr. Brown: If the Conservatives have transformed the country, why are 2 million people unemployed? Why is there massive job insecurity throughout the country? Why are we experiencing the slowest surge of investment out of recession at any time this century? Why—in terms of the measures that the Chancellor chooses to use, such as national growth—do we have the lowest non-oil growth of any European country for the past 15 years? The Chancellor thinks that national income per head is not a measure worth using. I thought that he would throw up that subject—he has to create a smokescreen, because at no point has he denied my central figure.
  I looked back over the Chancellor's publications and was surprised to find one entitled "Britain in Europe", which spoke of new hope for the regions. Its authors are given as Kenneth Clarke and Elaine Kellett-Bowman—[Laughter.] The Chancellor chooses his co-authors well. I do not know who will take the blame or the responsibility for what I am about to say.
  The Chancellor talks of how everyone should benefit and asks what action can be taken to sort out the regions of Europe. He asks how we should measure the difference between the richest and poorest regions and concludes that they are calculated in terms of gross domestic product per capita—exactly the same measure that the Chancellor now doubts when I put it to him.
  Mr. Clarke rose—
  Mr. Brown: I shall allow the Chancellor to intervene once more, but this is my speech and I hope that he has a speech to give.
  Mr. Clarke: The hon. Gentleman is obviously lost for words for a moment and is obviously searching for policy. I wrote another pamphlet on regional government in this country, which was adopted by the Labour party for a time as its regional policy, but it, like me, has changed its mind and has now dropped the policy. When I wrote that pamphlet—
  Dame Elaine Kellett-Bowman: When we wrote it.
  Mr. Clarke: When I assisted my hon. Friend the Member for Lancaster (Dame E. Kellett-Bowman) to write the pamphlet, when she was a Member of the European Parliament and I was shadow spokesman, we were making unfavourable comparisons of every sort with the rest of the continent. But I was not using those figures as a prosperity league, as the hon. Member for Dunfermline, East (Mr. Brown) keeps calling it. Will he not admit that, throughout the 1980s, we led the French and the Germans on growth, and we beat everyone else on productivity? Living standards have increased by 40 per cent. and the hon. Gentleman would see that we continue to move up any sensible league table if only he would use one.
  Mr. Brown: I hope that the Chancellor will be more accurate when he delivers his Budget next Tuesday. His figures about growth comparisons with France and Germany are completely inaccurate. Our non-oil growth rate over the past 15 years is 1.6 per cent; even with oil, it is 1.8 per cent. That is way behind our more successful competitors, particularly Japan, which has a growth rate of more than 3 per cent.
  As for the Chancellor's pamphlet on regional government, I know why he wants to disown it, as I am one of the few who has read it. He proposes indicative planning, a national plan, regional plans and regional economic plans. I am not sure that the No Turning Back group and the 92 group would look favourably on any of those proposals.
  After four Chancellors, 11 Secretaries of State for Trade and Industry and 17 Queen's Speeches in 16 years, the Government now tell us that they have discovered the answer. They have found the key, as the questioner suggested, to the problems of the British economy. They ask us to look not at Britain—which the Conservatives have governed for the past 16 years—but at Hong Kong and Singapore, where they have not been in government. The Conservatives want us to judge them on their promises for the future and not on their record of the past. Their answer today is a return to their policy of 1979: cut public spending as a share of national income, instead of concentrating on the real task of raising the level of investment in the economy.
  Why is current Government spending £80 billion higher in real terms than it was in 1979? Lady Thatcher confirmed that Government policy in 1979. Why is current public spending as a share of national income the same as it was in 1979 when we left office? The Government have not solved the problem of public spending, because they are paying the bills for unemployment, waste, decay and failure. In spite of £100 billion in North sea oil and £120 billion in privatisation proceeds, taxes have risen by the equivalent of 7p in the pound. Why have there been 21 tax increases in the past three years—nearly £1,000 per year for every family in the country?
  Yesterday, the Prime Minister told us the reason for the tax rises. He did not admit his failure, but he said:
  "we did so to protect people who were vulnerable".—[Official Report, 21 November 1995; Vol. 267, c. 456.]
  He should tell that to the pensioners and to the weakest and the frailest in the country who suffered the value added tax rises imposed by the Government. The Government did not help the most vulnerable: as is typical of the Conservative party, the tax rises were so unfair that they hurt the most vulnerable the most. It is on that unfairness and that betrayal that the Conservatives will be judged.
  Mr. John Townend: The Government have a target to bring public expenditure below 40 per cent. What would be the hon. Gentleman's target if he were Chancellor? Would he bring it below 40 per cent., would he leave it where it is, or would public spending increase?
  Mr. Brown: Public expenditure would be below 40 per cent. of gross domestic product if the Government had solved the problems of unemployment, waste and the other bills of economic failure. I will not be lectured by a

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  Conservative party which promised to cut public spending as a share of national income in 1979, but which saw public expenditure in all but two of the past 16 years rise above 40 per cent.
  I admire the honesty of the hon. Member for Bridlington (Mr. Townend). He said that there must be tax cuts in the Budget and he issued a statement announcing how many billions of pounds in cuts he wanted to see. However, he said that, even then, it would not return the Conservatives to their 1992 position. No tax cut that the Chancellor may introduce next Tuesday will undo the damage of income tax rises equivalent to 7p in the pound since 1992.
  At the same time as the Government have caused us to fall behind our competitors, the country has slipped back as massive job insecurity has dragged down the economy. Job insecurity in the labour market is now dragging down the housing market. When survey after survey shows that that is the greatest anxiety of British people, what are we told by the President of the Board of Trade? He says that job insecurity is only a state of mind. He says that it is not real, but a figment of the imagination. He says that it is all in the mind.
  Let the right hon. Gentleman look no further than his own Back Benches. Do Conservative Members have no worries about their jobs? Is there no fear of redundancy on Conservative Benches? We know that any worries they might have about their jobs are not real and that it is all in the mind, but if the President of the Board of Trade really believes that job insecurity and the fear of unemployment is only a state of mind, how can he explain the extraordinary zeal for travel discovered recently by Conservative Members, particularly those with majorities of less than 10,000, and their willingness to take the advice of Lord Tebbit and get on their bikes, in droves? Surely their worry is nothing more than a state of mind.
  Job insecurity is only in the mind, except for the former Chancellor, the right hon. Member for Kingston upon Thames (Mr. Lamont), for whom it is in Kingston upon Thames. It is only in the mind, except for the standard bearer of Essex man, the hon. Member for Basildon (Mr. Amess), for whom it is to be found in Basildon.
  Dame Elaine Kellett-Bowman: He is not here.
  Mr. Brown: He has gone. He has run away as a result of his failure to hold a seat that Labour will definitely take at the next election because of the policies that we are putting forward. Job insecurity is only in the minds of many Cabinet Ministers, when it is actually to be found in real life.
  As people's response to the Queen's Speech shows, Conservative Members now have short-term contracts and, for the first time in 16 years, they are facing the same anxieties as the British people. They should not reject out of hand Labour's proposals for jobs to help the unemployed, as they may need them after the election.
  Dame Elaine Kellett-Bowman: Does the hon. Gentleman accept that many Members who are seeking new seats have simply had their boundaries changed, so their seats have disappeared? Whatever Labour Members may say, it is important to make it clear that Members are not running away from existing seats; they are simply moving because their seats no longer exist.
  Mr. Brown: It is strange that the chairman of the Conservative party, who has a substantial majority in a seat that remains, is moving to another seat. People may wonder why he is so worried about defending that majority as a result of pressure from the Labour party.
  Dame Elaine Kellett-Bowman: Will the hon. Gentleman give way?
  Mr. Brown: I would rather give way to the hon. Lady's co-author.
  Dame Elaine Kellett-Bowman: On a point of order, Madam Deputy Speaker.
  Madam Deputy Speaker (Dame Janet Fookes): Order. It is clear that the hon. Gentleman is not giving way.
  Dame Elaine Kellett-Bowman: I am raising a point of order. I was not asking the hon. Gentleman to give way, as I knew that he would not. Is it in order for the hon. Gentleman to mislead the House by pretending that a Member is running away, when his constituency has been cut in two and he is simply taking half of it?
  Madam Deputy Speaker: The Chair, perhaps mercifully, is not responsible for the accuracy of Members' remarks.
  Mr. Brown: The hon. Gentleman protests too much about the position of the chairman. [Interruption.] I apologise to the hon. Lady.
  Dame Elaine Kellett-Bowman: That is sexism.
  Mr. Brown: I have apologised to the hon. Lady, and I hope that she will accept my apology.
  Is there anything more symbolic of the Conservative party's lurch to the right than the content of the Queen's Speech, which announced legislation to cut help for the homeless, used the full might of the Oxford English Dictionary to redefine exceptional hardship as uniquely severe suffering in order to deprive people of housing benefit, and picked out single parents for further onslaught?
  Although the Government really wanted yet another social security cuts Bill for the withdrawal of benefit, they hesitated, not from compassion, but, as the Secretary of State for Social Security said in a leaked memo, because they had no parliamentary majority to get it through. The Government do all those things, while at the same time they do nothing about excesses in the privatised utilities, implementing the Greenbury report in full, reforming capital gains tax to avoid excesses and abuses or dealing with the scandal of National Grid. Instead, day in, day out, the Government pour scorn on the measures that we propose.
  Nowhere is the abuse of power clearer and the Government's failure to act in relation to privatised utilities more obvious than in the sale of National Grid, which was announced today—a £5 billion asset from which consumers and taxpayers will get only £1 billion in refunds on their bills. That makes every day the case for imposing a windfall tax. What is to happen to the other £4 billion?
  Four National Grid directors have been able in the past few months—since Greenbury—to award themselves huge share options, even before shares were available on

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  the open market. The Government did nothing. Directors were able to buy and sell shares even before there was a market in shares, and nothing was done. Directors were able to cash in their share options before the share price was set, to the tune of £1.6 million. Again, the Government did nothing. The share price was set by auditors, but cannot be set by the market. Again, the Government have done nothing. Despite more handouts to the directors and special dividends that they voted for themselves, still nothing has been done. Nothing has been done even about the compensation built into the share options.
  National Grid's chairman, Mr. David Jefferies, is to retire, but he is to come back three days a week and, with his pension, will earn in total £300,000 a year—as much as he used to earn for working five days a week. How can we believe that decisions are being made in the national or public interest, or even in the interest of the electricity industry, when such powerful people are able to set the terms on which they benefit from demergers and privatisations without recourse to the public?
  The half-a-dozen directors of National Grid are answerable only to a dozen regional electricity chiefs—who themselves have not only received a present of shares in National Grid but are reported to have had their tax bills paid, so that they get the full profit from the shares that they are receiving. That is the worst example of a privatisation or demerger. It is worse than the shocking abuses that arose from previous sales—so much so, there has in my view been a lurch to the right in the attitudes of the Conservative party more than that which is acceptable.
  From National Grid's report, I have calculated today that the former chief of London Electricity, Mr. Roger Urwin, has done well 10 times over, bringing him an annual income of £1.5 million—and he moved from London Electricity to National Grid in the past few months. When such abuse is tolerated, there can be no doubt that matters have been allowed to get worse since the Greenbury report, not better.
  What happened to the Greenbury proposals for legislation to disclose pensions, which I expected to see in the Queen's Speech? The Secretary of State for Trade and Industry said that the Greenbury proposals would be considered, and the Institute of Actuaries examined them and prepared a report. The proposal to legislate was accepted in principle by the Government, to be implemented after the measure was drawn up by the relevant bodies. The Government have not only failed to introduce the new Companies Act necessary, but have been persuading people that there is no need for action in that important area. Why has nothing been done?
  The company report for British Gas reveals that the pension contribution for Cedric Brown is £19,000. In fact, his pension is worth £300,000 a year, and it will cost the pension fund an astonishing and budgeted £4 million. Because the Government do not want us, the shareholders or employees to know those facts, nothing is done to insist that the full figures are published. At National Grid, a figure of £8,000 a year is declared—but the pension is worth £160,000, and it could cost £2 million.
  There is no evidence that the Government want those figures disclosed to the public, shareholders and employees. [HON. MEMBERS: "Shameful."' As my hon.
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  Friends say, it is shameful that consultation papers are prepared, promises made and legislation pledged—then the matter is sidelined, with no guarantee that the problem will ever be dealt with under this Government. A few powerful interests in the privatised boardrooms and elsewhere are blocking the full disclosure of pension information—and in yet another lurch to the right, the Conservative party is prepared to go along with it.
  The Government want to do nothing and hope that the controversy will go away. Let us examine the Greenbury recommendations and what has happened to them. Two-year rolling contracts were to be outlawed in favour of one-year contracts. Nothing has been done. The utilities were to examine their remuneration and put their house in order, yet small shareholders have still been told nothing. The stock exchange listing changes have been delayed until the end of the year.
  As for consultation on long-term incentives and share options, nothing has been done either. The promised review by the utilities to explain their remuneration packages, with a requirement for discussion at the first available annual general meeting, has not materialised. The report of a few days ago showed that only one of 24 utilities had taken steps to implement that recommendation.
  What about the share option proposals? It was recommended that no share options should be awarded during the first six months after a privatisation. Nothing has been done about that. It was further recommended that share options should not be awarded at 85 per cent. of their value—nothing has been done. How can the Conservative party tolerate the Prime Minister and Cabinet promising in the summer to take action, but doing nothing by the autumn, even as the abuses continue? The Conservative party has become a faction promoting the interests of the powerful few.
  What has happened to one-nation Toryism in Britain? The Conservative party stands by as the main recommendation to prevent exploitation and harassment is removed, in the Queen's Speech, from the housing and homelessness Act. At the same time, the party does nothing while abuses are identified. There was a time when one-nation Toryism controlled a majority in Cabinet. It was once even in control in 10 Downing street—it was even the dominant force among Conservative grassroots. But in the 1980s, one-nation politicians in the Conservative party were reduced to holding fringe meetings and attending the occasional lecture or well-fed dining club—
  Mr. Michael Fabricant: It is interesting to hear the hon. Gentleman's discourse on the history of the Conservative party. What we have not yet heard are any tangible Labour party policies, or how the hon. Gentleman intends to pay for any of them.
  Mr. Brown: I have just outlined 10 recommendations by Greenbury which the Government have failed to implement or whose implementation they have failed to supervise. We shall not take lectures from the Conservative party, which promises to implement proposals and then, as with Greenbury, fails to do so.
  To return to one-nation Conservativism: even the solitary token wet speech traditionally given by Peter Walker to the Tory party conference is no more. At this year's conference the one-nation group could not even,

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  muster a fringe meeting—they had to make do with a drinks reception. The Macleod society, which was to have been set up in a blaze of glory, could not find a sponsor for its first pamphlet, and is said to have only seven known members.
  Mr. Fabricant: On a point of order, Madam Deputy Speaker. It is one thing, perhaps, to comment on what is not in the Queen's Speech; but is it in order to discuss the Conservative party conference in this debate?
  Madam Deputy Speaker: That depends entirely on whether it is a passing reference or the mainstay of a speech. I am assuming that it is the former.
  Mr. Brown: It is indeed, Madam Deputy Speaker. The hon. Gentleman appears to be somewhat carried away after his appearance in "The Final Cut". Perhaps he is trying to sketch out a scene for a future edition of the programme—but it carries little weight in this place. He would do better to tell me whether he supports the one-nation group or whether he is on the extreme right of the Conservative party.
  The country wants to know what has happened to the social conscience of the Conservative party. It used to exist, but it has now almost disappeared—
  Mr. Ray Whitney rose—
  Mr. Brown: A one-nation Conservative? I shall take one intervention from a supporter of the chairman of the 1922 committee, and then another from one of his opponent's supporters—I do not know which the hon. Gentleman is.
  Mr. Whitney: The hon. Gentleman talks of what the country wants to know. What the country wants to know, and what we have now been waiting to hear for 34 minutes, is the policy of the Labour party.
  Mr. Brown: I have been outlining the investment and employment measures, and the action on the privatised utilities—
  Mr. Brandreth: Will the hon. Gentleman give way?
  Mr. Brown: Does the House think that I am going to give way to the hon. Gentleman—who might do better to spend more time in his constituency, given the narrow majority that he must hold on to? I shall proceed with my speech, and respond to no more interruptions.
  A further lurch to the right in the Conservative party relates to taxation policy. We now find that the Prime Minister has set the party a tax objective: the abolition of capital gains tax and inheritance tax. Who are the main beneficiaries of the new proposal? None other than the directors of the privatised water and electricity companies, which stand to gain £40 million each.
  The richest 5,000 in the privatised utilities have gained £500 million. Here is an idea that originated with the poll tax and from the No Turning Back group, the 92 group and the Adam Smith Institute. It was peddled on the right of the Conservative party, and then adopted by the Prime Minister for his leadership campaign. Capital taxation has been supported by every Conservative Prime Minister this century, from Bonar Law to Lady Thatcher, because they understood that it was necessary—in particular, to prevent tax avoidance through the declaration of income as capital. Yet the Conservative party has now come up with
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  a proposal that can benefit only a small number of people, and the Chancellor is having to adopt it as a major objective in taxation policy.
  Mr. Tim Devlin: Will the hon. Gentleman give way?
  Mr. Brown: I will not give way again.
  Abolishing capital gains tax and inheritance tax is now a tax priority. What has happened to the Chancellor—the person who once represented one-nation Conservatism, and who once called himself a one-nation Tory? How has that proposal slipped past him?
  The Chancellor has never been a details man—as he confessed after his speech on the Maastricht treaty, which he had never read. Does he now wish that he had been a little more careful with the detail? Does he wish that he had studied it more accurately? Is it not true that a new objective in taxation policy that can reward only the richest has been smuggled through the Treasury?
  Sir Peter Tapsell: Will the hon. Gentleman give way?
  Mr. Brown: No, I will not.
  The whole Budget process has been planned in Conservative central office, just like the Queen's Speech, and directed by the chairman of the Conservative party. The narrowest interests of the Conservative party are to come before the interests of the nation. It is all directed less towards getting the economy right than towards—in the words of the Conservative party chairman—"wrong-footing the Labour party". That is what the right hon. Gentleman said yesterday, when he held a press conference on tax and spending issues.
  Even the Chancellor is now forced to admit that this will be "a political Budget". We know that it is not about the needs of the country, but about the needs of the Conservative party. Just as the Chancellor has been bounced into a policy favouring the abolition of capital gains tax and inheritance tax, on Budget day he will be bounced into doing things that he knows are not in the interests of the country.
  What shall we see next Tuesday? The door of No. 11 Downing street will swing open; the photographers will step forward for the traditional shots; the Chancellor will appear on the doorstep, looking around for the official Rover that will drive up and from which, eventually, will emerge the chairman of the Conservative party to hand over the red Budget box. The Budget will have been conceived in Conservative central office rather than in the Treasury, but, to be fair to the Chancellor, he will already be well aware of what is in it: the chairman of the Conservative party will have briefed the press on its contents the day before.
  So where is the Conservative party now? There is nothing in the Gracious Speech to rebuild our industries. There is nothing to tackle the huge skills gap revealed in the White Paper on competitiveness. There is nothing to bridge the gap between rich and poor in this country, and nothing to rebuild its infrastructure. There is nothing of which the Conservative party can be proud. There is no grand strategy, no broad vision, no new programme.
  Even after the Budget next Tuesday, the Conservatives will still be in difficulty, still in the hole that the Chancellor says they are in. Nothing that they can give

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  away next Tuesday can restore what they have already taken away. Even if they brought down taxes by 2p, 3p or 4p in the pound, the Chancellor would still have to find £6 billion to £10 billion to restore to the taxpayer the equivalent of the 7p in the pound by which he and his colleagues have raised tax since 1992.
  That is the Tory strategy to try to win over the people, but a tax cut every five years will never make up for the 21 tax rises in the years in between—tax rises followed by tax cuts. No doubt, if the Conservatives had the chance, the new tax cuts would again be followed by tax rises after the election.
  That is all part of a pattern that exposes a short-termist Government, motivated and driven only by electoral calculations, negative in all their campaigning and acting like an Opposition rather than a Government. Next week the Prime Minister will have had five years in power but, as the former Chancellor of the Exchequer, the right hon. Member for Kingston upon Thames, has said, he has been in government, but he has not been making the decisions. There will be no prize of five more years, no street parties and no celebrations.
  In 1990, the Prime Minister promised a classless society, opportunity for all and a nation at ease with itself. Instead, under his leadership his party has become a group dominated by extremists who have abandoned the centre in pursuit of unity—a two-nation party when there are no longer two-nation answers to the problems that the country faces.
  The Conservatives are a party of the past, huddling round burnt-out ideologies, too weak to face up to the challenges of the next century. As we heard in the Gracious Speech, they are reducing complex problems to the repetition of the simplest and crudest slogans—scapegoating, xenophobic and turning on minorities. They do not care what is left among the ruins.
  A divided nation and an unsuccessful economy are too high a price to pay for the last days of the Conservative Government. They are out of touch and their Ministers are out of their depth; they are out of time, and they should be out of office.
  4.57 pm
  The Chancellor of the Exchequer (Mr. Kenneth Clarke): Earlier this week, on a more solemn occasion, the nation was glued to its television sets as a major public figure made important pronouncements: the hon. Member for Dunfermline, East (Mr. Brown) was trying to make an announcement about tax policy. It misfired—yet the author of the 10p tax gimmick has the nerve to accuse me of being "never a details man".
  The hon. Gentleman has not mentioned his new idea today. I thought that we might be given a few more details, but apparently the policy that nearly emerged over the past weekend of error has already been withdrawn, and it played no part in the speech of the shadow Chancellor in the House of Commons four days later, a week before the Budget.
  Mr. Gordon Brown rose—
  Mr. Clarke: No. I shall give way in a moment, but first I ask the hon. Gentleman to tell us which of his
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  shadow Cabinet colleagues gave him the strong advice that they wished to hear no more about income tax at lop in the pound.
  Mr. Brown: The Chancellor's first two jokes have misfired. Which does he think is fairer—the objective of a 10p starting rate for income tax or the abolition of capital gains tax and inheritance tax? Will he give a truthful answer?
  Mr. Clarke: It was not my joke—the 10p in the pound rate was the hon. Gentleman's joke. Perhaps the hon. Gentleman expected me to come back with a 5p in the pound rate, as he appears to want to conduct economic policy in that way. The hon. Gentleman knows perfectly well that it was a bizarre and ill-judged policy, and it is the nearest he has ever got to showing us an inch of detail that we could discuss in the House. That is an abuse.
  Mr. Brown rose—
  Mr. Clarke: Will the hon. Gentleman give us a measure? Is there a Labour party tax commitment that he might wish to offer the House?
  Mr. Brown: Will the Chancellor answer the question I put to him? I have set down the principles for a modern taxation policy as fairness, encouraging work and opportunity and being honest with the public, none of which is achieved by the modern Conservative party. Which is the fairer—a l0p starting rate for tax to help work opportunities and to reward effort, or the abolition of capital gains tax and inheritance tax?
  Mr. Clarke: I believe in the principles of fairness in taxation, and we demonstrate those principles. I believe that taxation should encourage work and enterprise, and I am delighted to hear the Labour party at least pay lip service to the principle of incentive, which has guided the Conservative party's approach to taxation for a long time. We are committed in the long term to the abolition of capital gains tax and inheritance tax. The ex-socialist in the hon. Member for Dunfermline, East has not yet discovered the importance of capital taxation in an enterprise economy. His remarks on capital gains tax go back to the old politics of envy.
  The hon. Gentleman's policy of a 10p in the pound rate of income tax is an incredible gimmick, and independent commentators have pointed out that such a rate does not serve the objectives that he said it would. The hon. Gentleman is merely trying to enter into a bidding match outside this House and is aiming below our clear objective of a 20p in the pound basic rate, to which I shall return.
  The hon. Gentleman's speech was wholly typical of his approach to these occasions. He insists on having an economic debate less than a week before the Budget, and it is an obvious opportunity for the shadow Chancellor of the Exchequer to come to the House of Commons and give a shadow Budget. But he never does so.
  If the hon. Gentleman can praise one-nation Conservatism—which I certainly support—I can praise the Liberal Democrats, although this may never be repeated on the Floor of the House. The Liberal Democrats always set out their proposals on taxation at this time of year, and they say what they would spend that taxation on. They set out their views on interest rates and set out their economic policy. The hon. Member for Dunfermline, East always comes here and gives a rant and he always goes back to a

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  few of his favourite themes, such as the state of the Conservative party, but he hopes that he will not upset the shadow Foreign Secretary as much as his attempts to say something about economic policy always seem to do. The forced smile of the hon. Gentleman does not conceal the fact that arguments about divided parties do not come too well from that side of the House.
  The shadow Chancellor should come to the House and give us a full set of tax plans, spending plans and borrowing plans. But he cannot do that, because the numbers must add up. The hon. Gentleman cannot deliver a shadow Budget, because he does not have the policy components necessary to do so.
  Mr. Peter Hain: Will the Chancellor give way?
  Mr. Clarke: I will give way to the hon. Gentleman, who I hope will give me a policy on interest rates or inflation. I would also like to know whether he is rising in support of the official Opposition amendment, which was supposedly moved a moment ago by the hon. Member for Dunfermline, East. Does he support the amendment tabled by the right hon. Member for Chesterfield (Mr. Benn) and others, which has some policy in it? That amendment attacks the market economy and goes back to the old values of the Labour movement. I would like to know which amendment the hon. Gentleman supports, and then I want to hear a point of policy.
  Mr. Hain: Will the Chancellor give us a clear commitment that, when he is the shadow Chancellor in two years' time, he will deliver a shadow Budget one week before my hon. Friend the Member for Dunfermline, East gives his Budget? Will he promise that that shadow Budget will give marginal tax rates, detailed spending commitments and all the other paraphernalia of the Budget he is demanding from my hon. Friend? Will the Chancellor give a solemn promise to the House this afternoon that he will give a shadow Budget in two years' time?
  Mr. Clarke: I have been in opposition, and the Conservative party in opposition had clear economic policies. We most certainly knew what we were attacking the then Government for, as they had reduced this country to being the laughing stock of western Europe in any industrial league table. We put those policies into effect in the 1980s when we transformed this country into an industrial success story. We have clear objectives—
  Several hon. Members rose—
  Mr. Clarke: I will not take any interventions for the moment. The hon. Member for Dunfermline, East was generous in giving way, but I do not want to take as long as he did.
  We have a clear set of objectives for our economic policies—Government borrowing falling to zero; public spending below 40 per cent. of GDP; inflation below 2.5 per cent.; a basic rate of income tax of 20 per cent. Those are clear and consistent objectives, and we are putting them into place. We are delivering a recovery that will be for keeps and will increase the living standards of families year after year.
  The Labour party, after years and years in opposition, does not have a single element of a policy framework that has either been agreed upon by itself or that its Front-Bench Members have ever expounded or set out.
  Mr. Malcolm Bruce: The Chancellor has clearly set out his objectives, and has articulated them on a number of occasions. During the debate on the summer economic forecast, he said:
  "borrowing is actually taxation deferred."—[Official Report, 12 July 1995; Vol. 263, c. 979.]
  Does he agree that—against the background of a huge overshoot in current borrowing—any tax cuts in next week's Budget would have to be clawed back after the next election?
  Mr. Clarke: I have just set out our policy on borrowing, and one of the reasons for that policy has just been correctly set out by the hon. Gentleman. We are committed to reducing the borrowing balance to zero over the medium term, and that remains our firm commitment. We intend to return to a situation where the ratio of debt to GDP in this country is declining, and that is a policy that my predecessors and I have followed consistently. I have never heard the shadow Chancellor express a clear opinion on that objective, and certainly he did not do so this afternoon.
  Several hon. Members rose—
  Mr. Clarke: I shall give way later, or I shall be giving way more frequently than the hon. Member for Dunfermline, East did. I shall give the background against which our policies should be seen, so far as the Budget next Tuesday is concerned.
  The economy has been growing steadily for three years. Output in this country is now 6 per cent. above its previous peak in the boom a few years ago.
  Mr. Roger Berry: Will the Chancellor give way?
  Mr. Clarke: The International Monetary Fund expects Britain to be joint top with Germany in the league table for growth in the seven main industrial countries next year. Unemployment has fallen by more than 700,000 since its peak, and 1 million new jobs have been created since the recovery started.
  Mr. Berry rose—
  Mr. Clarke: Some 250,000 of those jobs were created last year alone, and the majority of those new jobs were full-time jobs.
  Mr. Berry: Will the Chancellor give way on unemployment?
  Madam Deputy Speaker: Order. I shall make it clear that hon. Members must resume their seats if the Chancellor does not give way.
  Mr. Clarke: I was about to add that we are enjoying the best run of low inflation for half a century.
  Mr. Berry: Will the Chancellor give way?
  Mr. Clarke: I shall give way to the hon. Gentleman. I am the Chancellor of the Exchequer in the only country in western Europe that has got unemployment down by 750,000, and the only country in western Europe that has been creating jobs—some 500,000—since the recession, so I will not be shouted at about unemployment by a member of a party that is in favour of a minimum wage and the social chapter, but does not even have the nerve

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  to say at what level a minimum wage would be, because it knows that we would put a figure on how many jobs the minimum wage would destroy. I shall listen out of courtesy to the hon. Gentleman on unemployment, as he might produce a policy. That would be more than his Front-Bench spokesman has done.
  Mr. Berry: I thought that the right hon. and learned Gentleman was the Chancellor of the Exchequer, and not me. If his policies and those of his predecessors have been so effective in tackling unemployment, why has unemployment under the Tories not been less than the level they inherited in any single year since 1979?
  Mr. Clarke: We employ a higher—[Interruption.] There have been huge changes in our labour market and those of our international competitors since 1979, and this country has prospered from these changes when compared with the rest of the western world. There are far more people in our work force now than in 1979. We have a higher proportion of our work force in employment than any other major western European economy. [HON. MEMBERS: "That is irrelevant."] It is not irrelevant. We have a lower level of unemployment than either France or Germany. The background is that we alone of the western European economies are creating new full-time jobs. We have a background of falling unemployment.
  The Labour party has no policy on the labour market except the social chapter, the minimum wage and a bit of policy about bringing back trade union recognition. Labour Members never speak about it. They give no detail about it. They would not even tell the Labour conference what figure they would put on the minimum wage. They know that the only policies they have on unemployment would drive it up, destroy jobs and put us back in our good performance compared with the rest of western Europe. That is why—
  Mr. Berry: Will the Chancellor give way?
  Mr. Clarke: No. It is enough. It is one consequence of the rules of the House that, when one gives way, one has the last word. I cannot keep coming back to the same point.
  Mr. Berry: It is not my fault.
  Mr. Clarke: It is not the hon. Gentleman's fault. It is because Labour Front-Bench Members have nothing to say on unemployment.
  The record that I have just described is the reason why an independent body such as the OECD has described our recent economic performance as impressive. I will not give the House all the other favourable adjectives that it has used about the current performance of the British economy. I have no intention of putting any of it at risk. The Labour party does not have the slightest clue what it would do about it if ever the whole thing were put into its hands. I hope that that will always be avoided.
  This year, growth in the economy has slowed. That is because I raised interest rates in order to keep inflation down. I did so because rising inflation destroyed the last three recoveries. I increased interest rates early to nip inflation in the bud. That, and my control of public expenditure, allowed me to resist pressure that might otherwise have taken interest rates further.
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  The approach of the Labour party to public spending control, the tax measures that I had to take, public borrowing in general and all the interest changes that I have ever made or refused to make has been non-existent. There has been no response. The official Opposition, pretending to be a Government in exile, have no views on the struggle that we have made to ensure that the recovery is not jeopardised again by a return to inflation.
  We used to have an official Opposition. We used to have a Labour party with socialist policies. We beat it time after time in elections. The Labour party has vacated those policies. Labour Members have turned from those policies to light entertainment in their speeches. They hope that they will get away with that and put themselves in charge of the best and strongest economic recovery in western Europe. Heaven forfend; the future of Britain is far too important for that.
  No serious independent forecaster expects the economy to move back into recession. All the signs are that growth will be sustained. A great deal of that will depend on investment. Of course we agree on the importance of investment and improving Britain's investment record. Business surveys suggest that the prospects for investment are good. Good economic conditions stimulate investment.
  Manufacturing investment rose by 12 per cent. last year. Consumer spending is on a steady upward path. Rising incomes and employment should keep it that way. We have retained our competitive position in the overseas market. Those are the policies. Those are the results on which the well-being and prosperity of British people and their families depend. Those are the serious matters to which the Labour movement in the House and outside contributes absolutely nothing.
  We have heard a great deal about league tables. The Labour party has used the table out of the competitiveness White Paper, to which it has added a little. It has bought advertising space to publicise the table and said that the OECD figures of GDP per head since 1979 are some kind of prosperity league table. GDP per head is open to its difficulties. Is the Labour party going to turn Britain into a secondary banking haven? If so, exactly how does it propose to go about it? Are we going to compare the proportion of oil revenue per head of population to that of Norway? Is that somehow rediscovery of oil? Norway is always one of the countries that the hon. Member for Dunfermline, East cites as having overtaken us.
  We have overtaken social democrat countries in Scandinavia which have followed the policies which until recently the Labour party advocated. Of course we have been overtaken by Hong Kong and Singapore, which are small island states in Asia. We should consider our position now in relation to productivity, inward investment and competitiveness in world markets. The hon. Gentleman misuses the tables.
  The hon. Gentleman starts with 1979, when we took over an economy racked by debt, recession, strikes and unemployment. For a time in 1981 the United Kingdom's economy dropped to 19th—even in the hon. Gentleman's league table—but that was because of the hon. Gentleman's party's recession, and, even in his table, we have recovered from that recession.
  Mr. Gordon Brown: Will the Chancellor give way?
  Mr. Clarke: I shall give the hon. Gentleman some fresh figures and then give way.
  Let us just examine where we are now. I agree that the measure of purchasing power parities is the way to do it. The United Kingdom's GDP per person is in line with the European Union average. The Central Statistical Office's recent "Business in Europe", another of our glossy publications, shows that, between 1981 and 1993, the United Kingdom's economy grew faster than those of Germany, France, and Italy, and it grew faster than the European Union average. That growth is showing on the ground: there are now 3.5 million active businesses in the United Kingdom, which is 50 per cent. more than there were in 1979. Business numbers are still rising, and business profitability is very high.
  The hon. Gentleman referred to nationalised industries. The first thing to say about nationalised industries is that they used to cost the British taxpayer £50 million every week. Privatised companies now contribute about £55 million every week in revenue.
  Mr. Alex Salmond: On a point of order, Madam Deputy Speaker. There is some noise in the Chamber. When the Chancellor was speaking about those comparisons, I could not hear whether he took as his starting year 1979, when the Conservatives came into office, or 1981, which was after a very deep recession.
  Madam Deputy Speaker: The Chancellor can deal with that himself.
  Mr. Clarke: The starting point that is always used by Opposition spokesmen—it is logical to look at when we first came into office—is 1979. In 1979, we took over from a Government who had an enormous amount of public borrowing because of its attempt to reduce taxation. It was an economy in steep decline which, between then and 1981, had to be turned round. Using 1979 as the date pulls down the average figures. Until 1981, the decline that we had been left carried on. The argument is very old, and it is only because those figures have been dug out that I resort to it. We had that argument all the way through the 1980s, and we always won it because people clearly remembered why we had to increase taxes and get borrowing under control when we first came in. They remembered how we got to the 1981 position, for which the comparisons are very different.
  Throughout the 1980s, our growth pattern was faster than those of the other European countries I have named.
  Mr. Gordon Brown: Will the Chancellor give way?
  Mr. Clarke: The hon. Gentleman should listen a little further because he might learn something, perhaps for the next speech.
  Mr. Salmond: How on earth can the Chancellor seriously compare the records when he misses out the first two years of an extremely deep recession? If he wants to compare the Government's record against that of other countries or against that of other parties, he should compare it over the whole 16 years; he should not miss out the first two years.
  Mr. Clarke: I make it quite clear when I say that, throughout the 1980s, we grew faster than Germany, France and Italy. In his intervention, the hon. Gentleman pretended to mishear what I said, and he said that I was
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  wrong. He knew perfectly well, however, what I was talking about. He wants to include the first two years after the winter of discontent in order to pull our record down. The winter of discontent was the creation of the Labour party, and it was the achievement of the Conservative party to get us out of it and set ourselves on the way to being the enterprise centre of Europe.
  Mr. Gordon Brown: Will the Chancellor therefore confirm that he accepts that we were 13th in national income per head in 1979 and that we are now 18th? Will he also accept that we were 13th in 1974 and 13th in 1979, and that all the decline has happened under a Conservative Government? Will he explain why we have slipped from 13th to 18th under a Conservative Government?
  Mr. Clarke: I have already pointed out to him that using GDP per head figures in that way is ridiculous. We published a whole document. The hon. Gentleman has become a monomaniac about one table, which he misuses in order to make his totally specious point. Our inward investment, our consumption, and our personal prosperity have risen throughout the years which, using this one table in a rather eccentric fashion, he claims were years of decline. It is no substitute for policy. We are doing better than the others now and the hon. Member for Dunfermline, East is trying to pretend that he has some hidden secret that might enable him to do better.
  Mr. Brown: The right hon. and learned Gentleman now wants to talk about investment. Will he explain why we have fallen to 21st in the investment league since 1979?
  Mr. Clarke: I shall give the hon. Gentleman some comparative figures on investment. Let us look at investment in the whole economy [HON. MEMBERS: "From 1979.'] I do not mind responding on the whole period of office. I am one of the last survivors of the long march and I am still here. I even survived a period in opposition to the Labour party, when it had a policy and it was a wrong one—it perhaps was even worse then.
  Investment in the whole economy under the last Labour Government grew by a grand total of 1.4 per cent. Since the Conservative Government came to power, investment has grown by 31 per cent. Obviously, we have been in power far longer than the Labour party, so one has to look at the annualised rate of increase—for the hon. Member for Dunfermline, East, this man of detail, that means how much per year. It has been 1.8 per cent. per year under us, as compared with 0.3 per cent. each year under Labour. Investment has grown six times faster under Conservative Government than under the last Labour Government.
  Let us look at a few international league tables—
  Mr. Brown rose—
  Mr. Clarke: Let me give the hon. Gentleman just one more figure from the Organisation for Economic Co-operation and Development on increased investment—[Interruption.] I have dealt with unemployment and now we are on to investment, which was the next point that the hon. Gentleman laboured.
  Judging from the annualised rate for the increase in investment between 1979 and 1994, we have moved to the top of the investment league for major economies in Europe. I just gave the annualised rate for the United

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  Kingdom, which was 1.8 per cent. but in France it was 1.2 per cent., in Germany it was 1.1 per cent. and in Italy, 0.7 per cent. We have outstripped those countries, although they all did a great deal better than Britain ever did under a Labour Government. We are top of the table; we are not bottom any more.
  The prospects for future investment, which is what matters—[Interruption.] That is what we are tackling in the Budget and that is what the hon. Member for Dunfermline, East will have to talk about next week—the prospects for future investment. Most forecasters share the Treasury expectation that investment will pick up strongly this year. The signs of investment growth are there. Manufacturing investment is, as I said, up 12 per cent. on a year ago. Business surveys all show that prospects for investment remain healthy and the Confederation of British Industry investment intentions balance remains buoyant.
  All that investment record—the strong record now—shows that we are making progress towards our goal. It is one of the reasons why the British economy has been growing faster than the G7 average for the past three years. If we are looking at league tables, the International Monetary Fund expects the United Kingdom to be joint top with Germany of the seven top economies—the G7 growth league table—in 1996. That is because of the success of our policies, to which the hon. Member for Dunfermline, East presents not the slightest alternative.
  Mr. Roy Beggs: Does the Chancellor agree that Government policies have largely contributed to the success that Northern Ireland now enjoys in attracting inward investment? Does he further agree that the location of that investment is best left to individual companies to decide rather than being subject to the direction of officials?
  Mr. Clarke: Yes, I entirely agree and I am absolutely delighted that the Northern Ireland economy is performing so strongly. As part of the United Kingdom, it is quite rightly benefiting from the success of British economic policy and of our success in making this country the most attractive location for inward investment in western Europe.
  I can set out a policy, although I am in Budget purdah. The hon. Member for Dunfermline, East knows that he has the advantage of me on this occasion, or he ought to have, because I cannot give specific measures beyond that. With no purdah, he produces nothing. The veil remains tightly drawn and nothing is believed. Every time he comes to the House on occasions when he ought to be saying what he would do if he was given stewardship of the national economy, he ought to answer our questions—the questions that i always ask.
  Does he think that public borrowing is too high, too low or about right? Does he believe that we are controlling public spending too much or too little, and would he control it more firmly to achieve his incredible 10p rate? I have asked him questions, but he retreats into the childish obfuscations, "We will wait to see what the economy will be like. We will await the full information."
  As is obvious from the folders that the hon. Member for Dunfermline, East clutches when he comes to the Chamber to speak, we shower him with information. We
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  have a Red Book of the Budget. Would a Labour Government put out a different Red Book? What on earth would be added to the knowledge of the British economy by a Labour Government, if they ever came to power? What about the statistics from the Central Statistical Office? We have put it aside; it is a totally independent agency. What statistics does he want it to produce to enable him to form some judgments on these vital matters?
  It is not that the hon. Member for Dunfermline, East is waiting to see the books, or that he does not know anything about the British economy. Every other financial commentator in the country bombards me with advice on what to do in the run-up to a Budget. Everyone I meet in the Rose and Crown tells me what he or she wants me to do in the Budget. The hon. Gentleman is the only man with no advice and no opinions—the only man in this country who thinks that talking about politics and economics is not allowed in polite company. He is shadow Chancellor and he has no opinions on any of those matters.
  At the last election, Labour stood on a policy. The party had a policy of increasing taxation and public expenditure. It was set out with clarity. There was a shadow Budget and there were no excuses then. Labour was a tax-and-spend party. We stood on a platform of aiming for lower taxation and cutting taxes—[Interruption.] Both policies were obviously based on the mistaken belief that the recession was about to end. Faced with £50 billion of borrowing, we acted in the national interest. We raised taxation and controlled public spending. In every sensible step we took, we were opposed by the Labour party.
  Had Labour won the last election, what would it have done? Yes, a Labour Government would have raised taxation because they would have raised public spending, which is what they committed themselves to. They would have increased taxation more and more because they would have discovered that they had to tackle that borrowing.
  Since that time, we have consistently set out our aims—our low taxation agenda, our desire to get borrowing down to zero and our desire for recovery. The Labour party—the all-tax-and-spend party, which it still is—has relapsed into silence.
  Mr. Geoffrey Robinson: The Chancellor must be aware that, just before the last election, the Government knew that the public sector borrowing requirement would go up to £50 billion.
  Mr. Clarke: No.
  Mr. Robinson: Of course the Government knew that. Given that set of circumstances, how could they have gone into the election with the promises that they made at the time?
  Mr. Clarke: If the hon. Gentleman thinks that all economic forecasting is spot on like that, so that Governments always know what is going to happen, he is making the job of Chancellor of the Exchequer sound a lot easier than I have discovered that it usually is. At the last election, all the parties plainly proceeded on the basis that we were out of the recession. We reacted in the public interest and the Labour party reacted by going into a burrow, from which it never emerges with any policy.

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  We know that tax and spend has not been abandoned. In one week last month in speeches in the House, 40 per cent. of Labour Members called for more public spending. Nearly half the interventions from the Labour party around this silent trappist monk who speaks on economic policy are to demand more public spending. The silence of the hon. Member for Dunfermline, East merely leaves him exposed to all the pressures in his party. It is no good him pretending to be a better one-nation Conservative than I am. I was there first and I know my way around this course much better than he does. He is no one-nation Conservative—he is not a shadow Chancellor of the Exchequer at all.
  Let us have a look at what some members of the hon. Gentleman's party say about his pronouncements. The right hon. Member—I am sorry, I am premature, the hon. Member—for Hackney, North and Stoke Newington (Ms Abbott) used these words early this week when she heard of something that struck into her soul so that she felt she had to respond to the hon. Member for Dunfermline, East; I think it was the 10p promise but it might have been workfare for young people. On the air, she said:
  "Gordon can say anything he likes if he thinks it is going to win the election. But ordinary Labour party supporters in this country, particularly the poor and the unemployed, when Labour is in power will be looking for other priorities from tax cuts."
  What about the TUC general secretary, John Monk, a man for whom I have considerable admiration? He said:
  "Rather than tax cuts, the emphasis should be to increase spending on areas that need it."
  We have had enough of this stupid bidding match where the hon. Member for Dunfermline, East tries to emerge from his silence to claim that he is likely to cut taxes more than a Conservative Chancellor is likely to cut taxes—complete nonsense and quite incredible unless he gives us some policy.
  It is not an impossible question, on the eve of a Budget, to ask the Labour party what it thinks the basic rate of tax should be. It does not know whether I am going to change it or what my views are, but it presumably knows what the basic rate of tax should be. Obviously, it will raise the higher rates of tax. It must know about that and have some ambition. To what is it going to raise the higher rates of tax?
  Will anybody tell us what is the policy of the Labour party? Is there any Labour Member prepared to get up and say on this key issue, a week before a Budget, what the policy of the Labour party on this issue and what the basic rate of tax should be? Are interest rates too high or are they too low? What inflation target should be set? Is there any member of the Labour movement, from the left, right or middle or from the shadow Treasury team, who has the slightest view on that simple matter? This is a total farce. [Interruption.] Oh, we have a figure.
  Mr. Fabricant: Does my right hon. and learned Friend realise that the reason why Labour Members cannot answer is that the shadow Chancellor's puppet master, the hon. Member for Hartlepool (Mr. Mandelson), is not in his place?
  Mr. Clarke: I think that that is probably right. The hon. Member for Hartlepool came up with what he thought was a remedy for the Labour party: "Let's stop having these policies, leave the rest to me, shouting over the telephone to BBC producers." That is no basis on which any
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  political party should ever aspire to government in a modern state. [Interruption.] I will not go back to the questions that I have already answered.
  On the key things on which Labour has a policy that it will not withdraw—the minimum wage and the social chapter—no detail is given or referred to, but they would be destructive of our competitive position. Everybody knows that I am pro-European, but I am vehemently against ever accepting the social chapter in this country, and vehemently against setting a minimum wage. All the talk of the hon. Member for Dunfermline, East about moving from dependency into work—it was the theme of my Budget last year when I worked on family credit; he has stolen it from me—is made nonsense of by his talk on the minimum wage, as my hon. Friend the Member for City of Chester (Mr. Brandreth) made clear in his intervention.
  Let me remind the House of what Adair Turner, the director general of the CBI, said on 15 November. This is the view of British industry and business. He said:
  "We do not agree at all on the Social Chapter and the minimum wage. We fear that the European Union and Social Chapter would force us to sign a blank cheque to cover the huge raft of workers rights it promises."
  He went on:
  "Mr. Blair claimed he would not sign up wholesale to everything in it. He may believe he does not want everything the EU wants. But because of this structure there are some things he won't be able to avoid."
  I am accused by the shadow Chancellor of not having read the Maastricht treaty. I can find my way around the Maastricht treaty a whole better than most people in the House, and as well as any. The Leader of the Opposition made it quite clear that he had not got the first idea about the social chapter and did not realise that he would not be able to pick and choose on the things that were introduced by a qualified majority vote.
  This debate is occupied by the Labour party with no economic policy or plans at all, but a large number of threats loom in the background from some of its supporters and interests, and its record of incompetence in power in the past. It is no good saying to the hon. Member for Dunfermline, East, "Where's the beef?", to use the old phrase; he does not even produce a skinny kebab by way of policy when he comes to the House.
  I will come to the House next Tuesday free of purdah and present the Government's detailed economic policies for next year. They will be guided by the clear, consistent principles that I have set out ever since I have been Chancellor of the Exchequer. They will be dedicated to making this country the enterprise centre of Europe, an economy that can earn the wealth in which all the people can share and which will pay for the public services about which they care.
  We are on our way to out-performing the rest of Europe. We have recovered from the disaster of the 1970s. The 1990s are going to see this country at the head of every economic league table that matters if we stick to the course on which we are set.
  5.35 pm
  Mr. Tony Senn: I was elected 45 years ago next week in succession to a Chancellor of the Exchequer. I have heard many Chancellors of the Exchequer since, some of them eminently forgettable. I think that we may have heard another.

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  One thing that has not impressed people over the years is the selective use of statistics and selective quotations. People are not entirely and solely economic animals with a Treasury mode of thinking. Even if tonight, as he will, the Chancellor carries a majority in the House, he has not carried the British public on the policies that he has pursued. That is not only because of the so-called competence or incompetence of the Government; it is because the objectives of the Government are not shared by the generality of the British people.
  My hon. Friends and I have put down an amendment to the humble Address, which though not called—I cannot complain about that—it is in order for me to read into the record. It states:
  "But humbly regret that the Gracious Speech made no reference to the injustice and suffering caused by policies based upon the supremacy of market forces in the United Kingdom and world-wide, which have had the effect of elevating profit above the satisfaction of human need, widening the gap between rich and poor, causing mass unemployment and homelessness, starving industry of the investment it requires, harming the public utilities and the social infrastructure, eroding the Welfare State and universal benefits, neglecting essential public services in health and education, denying adequate pensions necessary for retired people, diminishing local authority and trade union rights, producing widespread personal insecurity and fear, creating social tensions and increasing the risk of conflict, encouraging the spread of racialism and intolerance, inflicting damage on the environment, undermining the democratic process and civil liberties and spreading disillusionment, pessimism and cynicism, all of which are features of global capitalism; and calls for the adoption of modern, democratic and socialist policies designed to secure the full use of all Britain's human and physical resources, and their fair distribution, for the benefit of the nation as a whole."
  It is by their objectives that Governments are judged. During wartime, victory is the only test. Nobody talks about inflation in wartime, only of defeating the enemy—killing the enemy. When I was first elected—and I am proud of it—the objectives that I have read out were widely shared by both sides of the House. After all, Winston Churchill had been an old Liberal. He had himself nationalised British Petroleum when he was First Lord of the Admiralty. He introduced the Sunday shopping rule and the wages councils. Since 1950, the centre of British politics has altered radically to the right.
  We see the consequences in the opinion polls. I do not have a great deal of time for opinion polling. I have no time for political images. The image that I have is the one that I use to shave in the mornings. I cannot change it. However, the Chancellor would be foolish to believe that one can run a society on the basis that profit is more important than human factors.
  My right hon. Friend the Leader of the Opposition, speaking in the House in June after the Halifax summit, said:
  "is not the central issue the revolution in the globalisation of the financial and currency markets, which now wield massive speculative power over Governments of all countries and have the capacity seriously to disrupt economic progress?"—[Official Report, 19 June 1995; Vol. 262, c. 23.]
  The Chancellor of the Exchequer has no real control over what should happen in Britain because he has to satisfy the international markets that his policies will not interfere with their objective of the maximisation of profit. That is the function of a Chancellor of the Exchequer and if, by
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  any chance, we were foolish enough to adopt a single currency, so that his job moved to Frankfurt, not only would those factors determine British policy, as they now do, and what we are allowed to do, but the power of the law would be in the Frankfurt bank rather than in the Treasury.
  I, and people whom I meet when I go round the country, ask ourselves what the real cause of the problem is. Is it an incompetent and unfair Government? That is an easy thing for an Opposition Member to say. I believe, however, that there is something much deeper. If the House is in disrepute at the moment, it is not just because of sleaze and all the arguments, but because we in the House do not address the central questions that have to be addressed if we are to provide a decent society.
  Mr. Matthew Carrington: Will the right hon. Gentleman give way?
  Mr. Benn: I do not intend to be provocative. I hope to be thoughtful, and not to say anything that will bring a Conservative Member to his feet with a quotation that he might think will embarrass me. That is not the sort of speech I want to make.
  Mr. Carrington: I was not going to quote.
  Mr. Benn: I do not want to give way at the moment.
  The county of Derbyshire, which I have the honour, in part, to represent, needs £100 million for school repairs. Derbyshire, like all local authorities, has been strangled by the Government. Local democracy—this matters to Conservative as well as to Labour councillors—has been absolutely strangled. In the 19th century, long before the Labour party was formed, Joe Chamberlain in Birmingham introduced municipal housing, municipal hospitals, municipal water, municipal gas and municipal museums. When I was an RAF trainee, I learned to fly at the Birmingham municipal airport. That was the heyday of local government, which has been absolutely destroyed by the Government's policies.
  Let us look at health. I and the right hon. Member for Old Bexley and Sidcup (Sir E. Heath) are the last remaining Members who sat in the House when Anuerin Bevan was Minister of Health. Anyone who looks at what we were able to start in 1948, when we were bankrupt after the war, will see that there was absolutely free health care when we needed it. It has never, of course, been a free health service. It was free when we needed it, but we paid for it when we were well. That health service has been utterly destroyed. The increases in prescription charges have been so high that prescription charges can even exceed the cost of the drugs if bought in a chemist's shop without a prescription—if that is possible. There are long waiting lists and services are being privatised.
  I expect that the House has heard of the little document, which is circulating, about the boat race between the NHS and a Japanese crew. Both sides tried hard to do well, but the Japanese won by a mile. The NHS was very discouraged and set up a consultancy. The consultancy came to the conclusion that the Japanese had eight people rowing and one steering, whereas the NHS had eight people steering and one rowing. The NHS appointed people to look at the problem and decided to reorganise the structure of the team so that there were three steering managers, three assistant steering managers and a director of steering services, and an incentive was offered to the

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  rower to row harder. When the NHS lost a second race, it laid off the rower for poor performance and sold the boat. It gave the money it got from selling the boat to provide higher than average pay awards for the director of steering services. That is what is happening all over the place. There is masses of bureaucracy in the health service and a denial of what people need.
  The people who will have to pay for all this are the people for whom the welfare state was devised. I have been searching for the origins of the Secretary of State for Social Security's new proposals for dealing with welfare. I found them because, after 30 years, Government papers are published. The stationery office has just put on a CD-ROM all the papers for 1964. I give the Chancellor this quotation from his colleague. This is the Conservative Chief Whip, Martin Redmayne, sending a minute to the Prime Minister on 19 June 1964. The Conservative Chief Whip said:
  "The first essentials are to accept that the benefits of the Welfare State should not be universally received and secondly, the insurance principle, which is already eroded, is not sacrosanct. In this connection I would like to see all above a certain income level excluded from benefits."
  The Conservative Prime Minister, Alec Douglas-Home, wrote in his own hand—I have a photocopy of this:
  "Beveridge was very costly. Would another inquiry be as bad or if we win, should we not impose our own scheme?"
  It was only the defeat of the Conservatives in 1964 that prevented the welfare state from being dismantled then. It is now the present Government's intention to dismantle it.
  We then come to the arguments that are put forward when people say that things are unfair and when they protest. One argument is, "You have no rights without responsibilities." That is a very popular phrase nowadays. I looked at the origin of that phrase and found that those very words are in the Brezhnev constitution in the Soviet Union in 1977. An authoritarian system is being introduced, through the Criminal Justice and Public Order Act 1994 and so on, which aims to repress the dissent against policies that are manifestly unfair.
  The Chancellor questioned us—that was fair enough—on what the Opposition would do in power. As a candidate, taxation is not an issue that has ever embarrassed me. There are two questions about taxation that ought to be asked: "What is it for?" and, "Who pays for it?" If we tax old-age pensioners by imposing VAT on their fuel to buy a Trident, that is wrong. If we tax people who are better off to fund a proper health service, that is right. The Chancellor, who is a member of the Government, has given 50 billion quid away to the richest 10 per cent. Every family of four—I had the figures broken down for me by the House of Commons Library—spends 40 quid a week on weapons, 40 quid a week paying for unemployment, which is a deliberate policy, 40 quid a week on law and order, much of it caused by mass unemployment, and 20 quid a week on the common agricultural policy.
  The Government should not tell us that money is not available for the things that need to be done. Of course it is available, but it involves recasting the priorities to bring the nation's resources fully into use. That should be the objective of government. The Government should see that there is no waste of human resources when so much has to be done. In wartime, as I mentioned, market forces did not prevail. The weapons were provided by the
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  Government. If we could have full employment to kill people, why can we not have full employment now? Why cannot we use unemployed building workers to build the houses that we need? Why cannot we recruit the nurses and teachers we need? Why cannot we have the people who are needed to look after the old? Why not? Because it is not profitable.
  The core of the Chancellor's argument is that profitability should be the test of everything that we do. I utterly reject that. The Government use the word "customers". Someone who does not have any money is not a customer and that is why the Government have invented this use of the word "customer". The homeless in cardboard boxes are not customers because they cannot afford a house, so they can be disregarded.
  The Government talk about competitiveness as if everything was competitive. Most things that matter in life are not profitable. Schools are not profitable, hospitals are not profitable, the police are not profitable, the Army is not profitable and the Chancellor is not profitable, but the nation knows that it requires those services to survive. We must get on—I do not say get back—to the position where the employment of all people is a national objective. The health of the nation is a national objective and we should ensure that we develop policies for that purpose.
  I know that I speak at a time when left-wing views are supposed to be out of date. My own assessment is simple. It is not just socialism that market forces have attempted to destroy, but Parliament, democracy and the social fabric. The House should not think that the situation will remain like that. We need only look at the defeat of Lech Walesa, or what has happened in Russia. Look at the defeat of the right-wing leader of the German SPD. The people are now gaining a new perception of what they want in the 21st century. They want fairness, and they want to use the resources of their own countries for the benefit of their own people for the short span during which we live on the earth.
  Debates of that character would be more interesting and relevant to people outside than what passes for an exchange of management expertise. We in this House are not, dare I say it, managers. We are representatives. Who represents the unemployed? Who represents the old who have been denied a pension related to average income? Who represents the kids who cannot get work when they leave school? Who represents the women who get married and cannot get a home? Who represents the people waiting for hip operations? They look to us to represent them in Parliament.
  I am proud to be in a party with a strong trade union base because those trade unions, having won the vote, knew they needed to have representation for working people in Parliament. The reason I am a dedicated socialist, and get more so, is that I know that any party that adheres to a market economy or profit as its prime objective will never solve the problems that confront my constituents.
  Although the Chancellor had fun in his speech, and I am sure that he felt that he had done well, the country cannot be run by disregarding human need and putting the almighty pound, dollar, deutschmark or ecu above people. Debates in the House about the economy should relate more to people and less to what we heard from the Chancellor today.
  5.50 pm
  Sir Terence Higgins: I am rather surprised that the shadow Chancellor is not still in his place, because there has been a long convention in the House that, after one has spoken, one remains at least for the next two speeches. It is a great shame that the hon. Member for Dunfermline, East (Mr. Brown) did not do so, because he would have been able to hear the right hon. Member for Chesterfield (Mr. Benn), and that would have given the hon. Gentleman some idea of the problems that he will face if he really thinks that in future the Labour party will become a party of low taxation and low public expenditure.
  We could not have had a clearer indication of the way in which the Labour party—and it would be true if it were in government—is still a party that believes in high public expenditure and high taxation than the speech of the right hon. Member for Chesterfield. No amount of change by the shadow Chancellor will convince people otherwise. Such economic thinking is still deeply ingrained in the Labour party, as the right hon. Member for Chesterfield clearly demonstrated.
  I am bound to say that this is the third occasion on which we have begun a parliamentary Session with an unsatisfactory timetable ahead of us. We have spent a number of days debating the Queen's Speech. We will then spend a number of days next week and the week after discussing the Budget. Before we know where we are, it will he Christmas. It is no longer possible under the current legislative process to have Second Readings of Bills, which could then go into Standing Committee and make progress, before Christmas.
  What is even more surprising is that, ever since the change in the legislative programme, the Opposition have repeatedly insisted on debating the economy during consideration of the Queen's Speech—the week before the Budget. The shadow Chancellor is coming up for his third Budget and, by now, I should have thought that he had realised that that strategy is a mistake. As my right hon. and learned Friend the Chancellor has pointed out, today's debate gives the Opposition a marvellous opportunity to put forward their policies ahead of those of the Chancellor, who is severely handicapped by being in purdah. But what happens? Year after year, the shadow Chancellor has totally failed to produce any policies, except for one this year on lop tax, which I shall discuss later.
  Although I have been somewhat persuaded by the Chancellor's view that a unified Budget helps the Government by focusing Ministers' ideas on the relationship between taxation and public expenditure, I am far from clear which way round that relationship operates. Does taxation determine the expenditure, or expenditure the taxation? As for the House, the Budget has not become a unified one, because for well-known reasons we still do not have the power to increase public expenditure or taxation. We can only reduce one or the other, or both, so we cannot exercise a choice. We cannot have a truly unified Budget in the sense that the House can trade expenditure and taxation against one another.
  I am somewhat persuaded, however, by my right hon. and learned Friend's view that a unified Budget at least concentrates the mind of Ministers. Although we have only the same amount of time to discuss expenditure and taxation, we can take a view on both according to the
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  events of next week. I want to defer my remarks on that until next week, which is the appropriate time to discuss the major issues of macro-economic policy.
  If it is intended that the Budget should deal with public expenditure and taxation, I hope that my right hon. and learned Friend the Chancellor, and the Leader of the House, who will reply to the debate, will consider whether the Budget should be produced in the spring. I know that that would require a radical change in the Government's internal workings, but it would be vastly preferable from a parliamentary point of view.
  Since I do not believe that this is the appropriate moment to discuss macro-economic policies, I merely want to refer to two specific issues, not least because they are of great concern to my constituents. The Gracious Speech referred to legislation being brought again before the House regarding the high speed rail link. That raises the question of compensation for those who are affected by such programmes. The high speed rail link will not affect Worthing, but it is important to consider compensation for those blighted by road programmes in my constituency.
  The Chancellor is aware that that issue of economic policy potentially involves huge sums of money, but we are not giving members of the electorate a fair deal. I am strongly of the opinion that we are getting our road and rail infrastructure on the cheap and at the expense of those who happen to be in the way of a particular scheme.
  A number of ombudsmen reports have been written about compensation to be paid in my constituency, where there has been a great deal of blight along the route of the A27. The Government have also lost a court case relating to compensation. I had hoped that those facts would provoke them to include in the Gracious Speech better and fairer proposals to compensate people affected by blight, not least that caused by rail projects. To my disappointment, instead of introducing new legislation to overcome the problem, which we could have debated and, if necessary, amended, the Department of Transport, no doubt aided and abetted by the Treasury, issued new guidelines for compensating people affected by blight.
  The court case led one to believe that those who had been affected by a road or rail scheme would get compensation if the benefit they had gained from ownership of property was seriously compromised. One imagined that that compensation would relate to loss in the value of the property. That has not happened. In addition to making it clear that a reduction in the value must be apparent, the new guidelines still retain the old noise criterion. That means that the Department of Transport is saying that one must meet that old criterion on noise apart from that relating to reduction in the value of the property.
  That is a serious issue. When we come to consider the matter in detail in relation to public expenditure, I very much hope that the Government will consider the implications. I am glad to see that the Chief Secretary to the Treasury is present. I recognise that even in my constituency the sums involved could run into tens of millions of pounds or even hundreds of millions. As for the rail link mentioned in the Queen's Speech, the sums involved could run to hundreds and hundreds of millions of pounds. It is still true, however, that the community as a whole is getting such infrastructure schemes without adequately compensating people who suffer because their homes happen to be in the line of a proposed route.

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  No doubt the Budget will contain proposals for changes in public expenditure. We have suffered from a number of rumours in the press about cuts in the road programme or other projects. That causes great distress to those who are expecting to benefit from a bypass or some other project.
  We all acknowledge that the Government are likely to give priority to education or the national health service. It is common ground that those sectors need to receive priority. However, if there are to be cuts in other sectors, such as in transport infrastructure, it is tremendously important that full consideration be given so that we avoid wasting public expenditure that has already been incurred.
  In a specific example that I can think of, we have already expended more than £6 million. It would be foolish if, in such cases, one were to stop the operation dead in its tracks, causing that money to be wasted.
  Similarly, it is important that the Government consider the effect on expectations of sudden changes in public expenditure programmes. For that reason also I am glad that my right hon. Friend the Chief Secretary to the Treasury is in the Chamber. It is important that the Treasury, in dealing with other Government Departments, should take into account the human impact—the Treasury, of course, is always very concerned with humanitarian issues—of rapid changes in public expenditure programmes.
  My right hon. and learned Friend the Chancellor of the Exchequer has discussed the proposal that suddenly emerged from the shadow Chancellor, before the publication of the Sunday newspapers, for an introductory lower rate of 10p in the pound for income tax. That is an extraordinary proposal.
  Sub-editors wrote marvellous headlines in the Sunday paper: "Labour goes for lop rate of income tax without any regard at all for where it is coming from". That is not true. This time we were told where it was coming from. With all previous promises of that type by the Labour party, we were never told where the money was coming from. This time the shadow Chancellor said that it would come from economic growth.
  If I may misquote Mrs. Beeton, first get your growth. Post-war history is littered—my goodness, the right hon. Member for Chesterfield knows enough about that—with promises that the Labour party has made in the expectation that there will be growth. One must get the growth first and then decide what to do with it.
  Even if the Labour party had got the growth, is a lop introductory rate a sensible way to proceed? It would be more complicated administratively—especially now, because we are adopting a system of tax self-assessment—and that would be a waste of resources. Surely it would be better to lift the threshold and help people at the bottom of the scale.
  This is an extraordinary gimmick. Totally impartial organisations such as the Institute for Fiscal Studies have said that it was an extraordinary thing to say. It reflects the shadow Chancellor's lack of judgment in those matters. He has, if I may phrase it that way, no feel for matters economic. That is a serious handicap—one that would cause anxiety if we believed that there was any prospect of his undertaking the job that he now shadows.
  As my right hon. and learned Friend the Chancellor said, we heard nothing about what Labour policies will be. If the shadow Chancellor wants to hold this debate
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  ahead of the Budget, surely he should tell us about that. He gave us no assessment. We are constantly told that he is having a battle with his shadow Cabinet colleagues about public expenditure, but we are given no sign of what his priorities in public expenditure are, and no explanation for his belief that there should be a 10p introductory rate of income tax.
  The shadow Chancellor tells us nothing about how wide the band will be. If there is to be a lop rate of income tax for income of up to £60,000 a year, it would be of interest; but it was a 10p rate of income tax divorced from any band. For all that we know, it was a lop rate of income tax on the first £1. We were given no sign. That is a literally unbelievably superficial view of the way in which one should propose economic policy. It should therefore be treated in the way that it deserves.
  The Leader of the House will reply to the debate. I hope that he may say a little about the parliamentary timetable. I find incredible the way in which he has stood up to the events of recent months, chairing the Select Committee on Standards in Public Life and the Privileges Committee, involved in public expenditure decisions, standing in until recently for the Prime Minister, as well as being Leader of the House, and now replying to the Queen's Speech debate.
  The Queen's Speech includes several extremely worthwhile measures, which I am happy to welcome. I hope that the Chancellor of the Exchequer, in the Budget that he introduces next week, will be able, outside the purdah that inhibited him this afternoon, to propose a positive policy that will have excellent prospects with regard to taxation and public expenditure.
  6.4 pm
  Mr. Malcolm Bruce: The right hon. Member for Worthing (Sir T. Higgins) is right to warn about the dangers of basing spending proposals on future growth, but I hope that he would acknowledge that the same must apply to the Conservative Government, and that the Chancellor should not be talking—he is not yet talking—about tax cuts until he has achieved his objectives on the finances. I shall return to that subject later.
  The right hon. Member for Chesterfield (Mr. Benn) also took us to an argument. Of course there is an argument about what overall taxation should be, but there is a legitimate and proper argument, within that framework, about the priorities that divide the parties. It is very unfortunate that sometimes our debates do not allow that argument to take place, and that only the absolutes, in terms of financial framework, are discussed.
  The present debate may be regarded in future as historic. We are reaching the end of a Government who are further behind in the opinion polls than any Government have ever been and secured re-election. We might be holding the last debate on a Tory Queen's Speech, and in that context it might be the last chance to determine the extent to which the Government have performed on economic policy on their own terms.
  It may be worth reminding the House that, since the Conservatives came to power in 1979, boasts have been made throughout successive Parliaments, by successive Ministers, that we are in a new era for Britain—that an economic miracle has been wrought, with higher growth

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  and lower taxes. In fact, 16 years on, in most material ways, nothing has fundamentally changed and the Government have failed to deliver on all those promises.
  It is not that nothing has changed. I am happy to acknowledge that, within the balance sheet, some good things have happened. The reform of the trade unions is especially important, may be long lasting and was actively supported by Liberal Democrats and our predecessors.
  The recognition, which was not heard in the speech of the right hon. Member for Chesterfield, that one does not get something for nothing and one must operate in a disciplined budget framework and take account of market forces, is correct. The Government have acknowledged that one must have a policy about balancing the budget in the medium term, although it is interesting to note that the Chancellor has changed his language on that. His object used to be to balance the budget in the medium term. Now it is to get the budget towards balance in the medium term—a more relaxed attitude at this stage of the Parliament.
  Having acknowledged that there are some achievements, it is worth recording the scale of the failure. Taxes under the present Government are greater than they were under Denis Healey, for all the talk about tax cuts. Growth has been, on average, about 2 per cent.—currently 1.6 per cent.—manufacturing output continues to be less than it was in 1979, and investment as a percentage of gross domestic product is the lowest on record. Unemployment is more than double what it was when the Conservatives came to power and has remained at that level. It is generally recognised that our education system and training standards are poorer than those of most of our competitors.
  There is therefore no economic miracle, and it is interesting that Ministers no longer speak about it in the way that they did even a few months ago.
  Manufacturing production growth is Zero per cent. and unemployment is 2.2 million and static. A very critical fact is that the public sector borrowing requirement is heading for a 50 per cent. overshoot on the current year.
  Liberal Democrats have targets on those issues and publish them, unlike the Labour party, so we feel that we may with some legitimacy make a constructive critique of the Government's performance.
  Retail price inflation is 2.9 per cent. It is greater than the 2.5 per cent. target that the Government set themselves for the present Parliament, and the Bank of England is sure that there is little or no chance of the Government achieving their forecast. Investment is low.
  I had a meeting last week with the German chamber of trade in London. Its representatives said that the extraordinary thing about investment in the British economy was that it was appreciated by foreigners—the Government were constantly boasting about levels of inward investment—but they did not understand why there was such low investment by British-based investors. I ventured to say that perhaps British investors knew the British Government better than foreign ones and had less confidence in their ability to deliver policy in the long term.
  There has been a devaluation under this Government, but its benefits are clearly waning, as this week's balance of payments figures demonstrated—they were the worst
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  ever. Ministers had boasted abroad about a strong recovery—an economic miracle—but it is fading, weak and fragile and needs to be handled with considerable care if it is not to be derailed. That is why the debate about the drive to reduce taxes which has seized the Conservative party is worrying. The economy is now performing substantially less well than it was a year ago and borrowing has not been brought under control. It is therefore extraordinary that, having been told last year that the position was so bad that there had to be a 3 per cent. increase in taxes, we can now apparently, against an even worse background, discuss tax reductions. That policy does not add up.
  The Government, who have claimed that they have an unyielding war on inflation—to reduce it and keep it permanently low—are clearly using much more relaxed language when they refer to inflation. The Chancellor of the Exchequer says that the target is 2.5 per cent., but if inflation turns out to be something above 4 per cent. we will be relaxed about it. That does not show the same degree of determination as when he first set the target.
  The need to reduce interest rates is more important to virtually everyone involved in the British economy than immediate short-term and unsustainable tax cuts. A 1 per cent. reduction in interest rates would save the Government £2.5 billion a year in interest payments. [Interruption.] Hon. Members are making remarks from a sedentary intervention so perhaps I should quote the Chief Secretary to the Treasury when he was speaking about last year's Budget. He said:
  "This year … we are set to borrow £34.5 billion, which is more than £25 a week of borrowing for every household … We forecast for next year a PSBR of £21.5 billion … Even at those levels of borrowing, no prudent domestic or international observer of the British economy should have expected to see tax cuts in this Budget … in the real world … it is more important for the British Chancellor of the Exchequer to be right than to be popular."— [Official Report, 30 November 1994; Vol. 250, c. 1237.]
  We seem to be hearing a different story. If £21.5 billion did not justify tax cuts when they were forecast and we are now talking about £30 billion as the outturn, it is difficult to see how the Government can justify the debate that they have allowed to take off among their Back Benchers. The Chancellor is being pushed to bribe the electors with their own borrowed money. He is borrowing at the rate of £1,000 per second. Some £160 billion of debt has been added to the national debt over the past five years--in addition to the equivalent of 8p extra on the basic rate of tax. Earlier, I intervened on the Chancellor to quote from his summer economic statement, in which he said:
  "public borrowing is actually taxation deferred."—[Official Report, 12 July 1995; Vol. 263, c. 979.]
  That is a good summary and should be noted. It will be noted after the election if taxes are cut before the economic circumstances exist to justify and sustain them.
  There was a time when Ministers took pride in the fact that they were sound financial managers of the economy, but they no longer listen to their own advice. The general election is pressing down hard on them and good economic management is less important than kidding the voters that the Government can deliver a miracle and hoping that the electors will not take account of the failure of the Government's forecasts.

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  In the same debate on the economic forecast, the right hon. Member for Fareham (Sir P. Lloyd) said:
  "With the overshoot in public borrowing last year, this year and next year, I fear that any tax cut, large enough for the Chancellor to boast about it, would rightly undermine confidence in the City and abroad in his consistency and good housekeeping, and would leave taxpayers thoroughly unimpressed to boot … They"—
  the electorate—
  "would note that the election was getting closer, and they would ask whether it would not have been easier all round not to have hiked up taxes last year just to lower them this year … Higher interest rates would not be good for investment, and the historically low rate of investment is probably our most persistent economic problem and the greatest threat to economic growth in the longer term."— [Official Report, 12 July 1995; Vol. 263, c. 992.]
  That was a Government supporter speaking in the House. Yet such is the political imperative that all that sound advice and sensible analysis is now being forgotten.
  Conservative Members, perhaps understandably, criticised the shadow Chancellor's speech because it did not give an alternative policy, but he has tabled an amendment which we can support because it identifies many of the things that are wrong. I agree with some of the Conservative criticisms that Labour's position lacks clarity on a policy about which electors are increasingly anxious to hear. The Labour party does not have a clear economic policy or tax policy to convince anyone. It may have a useful electoral strategy, but not an economic policy.
  The deputy leader of the Labour party has said on numerous occasions that cuts in the standard rate of tax could not be justified at present and should not be supported, but there has been no sign of what the Labour party will do. It seems that it will criticise policies, but allow cuts to be imposed even when they are irresponsible and will ultimately have to be reversed because they have been introduced at the wrong time against the wrong economic background.
  It is hardly surprising that the late John Smith's economic adviser, John Wells, left the Labour party in disgust last week. He said that Labour's policy was "simply dishonest". He said:
  "To argue the case for increased national investment … and then fail to provide and advocate the necessary means for achieving this is … a great deceit on the British people."
  Labour is apparently committed to a 10p tax—the right hon. Member for Worthing (Sir T. Higgins) was right to say that the level of tax is not known-5 per cent. VAT on fuel, higher benefits and higher spending. I wonder whether the shadow Chancellor is taking tax advice from Sting's accountant. The shadow Chancellor has been able to make his figures add up, but nobody outside the House can square them. It has been estimated that the minimum cost of a 10p tax rate would be £6 billion and we are entitled to know how that would be funded. It is not the most efficient way to deal with poverty anyway.
  As the Chancellor of the Exchequer acknowledged in his speech, we set out our alternative strategy in the Liberal Democrat's alternative Budget that we published yesterday, from which I shall pick out four points. Our Budget comes in advance of the Budget and the Chancellor is still in purdah so he might benefit from advice. We believe that reducing interest rates would be the biggest single contribution to assisting the economy. Interest rates in the UK are higher than those of our main competitors; they are higher than those of America,
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  Germany and Japan. The Chancellor must not put at risk any opportunity to reduce them and he certainly must not place them in danger of being pushed up.
  That is one reason why we have consistently argued for an operationally independent central bank. It is important to include and understand the adjective "operational". The policy parameters for the independent bank should be set by Government, but their day-to-day administration should be a matter of economic judgment, not political judgment. If we operated on those terms, we would achieve lower inflation and permanently lower interest rates. Our inflation target is in the range of 0 to 3 per cent. because we believe that the 1 to 2.5 per cent. range is proving unrealistically narrow.
  I wonder whether there should be some review of the operation of the inflation report. The discussions that I have had with the Bank of England suggest that trying to second-guess what will happen in two years is a very tricky business that is open to different interpretations. We must reach some agreement on how the report can operate more effectively and how we can take into account the balance of arguments. We must not have a futile argument about who is right, but must make a realistic assessment of the best estimate.
  We have proposed several tax reforms in our alternative budget. As a Member of Parliament representing a Scottish constituency and one who is interested in Britain's trade, I am glad to announce that we have specific proposals about the spirits tax. It seems that the pique displayed by the Chancellor last year following his defeat over value added tax and his decision to introduce extra taxation of 26p per bottle on spirits has backfired. The Treasury received less revenue from the sale of spirits this year than in the previous year. I hope that the Chancellor will learn from that experience and will take account of the Treasury Select Committee's report on the matter. He must recognise that the time is right to reverse that decision, if not go further and cut spirits duty by 56p per bottle. Spirits are our single biggest export earner and it is astonishing that we should treat them so badly in our home market.
  We have also introduced a progressive proposal to reform taxation which independent experts acknowledge is extremely efficient at delivering a transfer of funds from the better off to the poor and helping people to climb out of the poverty trap. We would impose a 50 per cent. tax on earnings over £100,000 per year and we would then use the resulting tax yield to remove 750,000 people from the tax bracket altogether by raising the threshold and harmonising the starting level for tax and national insurance. That would be a useful tidying-up exercise and I believe that the Chancellor should take our advice. Our proposal is progressive, fair, easily costed and self-financing.
  The most important commitment in our alternative budget is our pledge to allocate £2.5 billion over and above the sum allocated by the Government to education and training. Unless we raise the standards of education in nursery schools, secondary schools, universities and training colleges, we will not lay the foundations for the sustained economic performance that will deliver the economic strength to finance future programmes.
  In conclusion, the Government can no longer claim to have presided over an economic miracle. The economy is faltering, the Government have failed to meet their own

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  targets and we desperately need money for education and training in order to secure our future. We must invest now if we are to deliver success in the future.
  In that context, I shall make two points. First, if the Chancellor introduces irresponsible tax cuts in next week's Budget, we shall vote against them on the grounds that the money should be spent on education and on bringing borrowing under control. Secondly, if the Government do not switch from short-termism to a long-term vision for the future, they must recognise that they have been in power for too long and they should make way for those with fresh ideas and a fresh approach who may deliver what the Government have failed to achieve in the past 16 years.
  6.22 pm
  Dr. Keith Hampson: I was interested, at both a personal and an economic level, in the suggestion by the hon. Member for Gordon (Mr. Bruce) that we should slash the duty on spirits. However, he forgot one important argument. If we were to see the level of devolution in Scotland for which he and Labour Members argue, extra tax would have to be generated to pay not only for the cost of running that Government but for all the commitments that a left-wing Government in Scotland would inevitably impose.
  Mr. Malcolm Bruce: No, it will not. We will have proportional representation.
  Dr. Hampson: The Labour party might have some thoughts about that. Under the present constitutional arrangements, we have seen the massive transfer of resources from south of the border into Scotland. Public expenditure per head in Scotland far exceeds its levels in England. People in my constituency in the north-east and in Yorkshire will not agree to continue to fund high cost programmes if Scotland is afforded the degree of devolution that is proposed. Therefore, the Scots would have to meet the funding gap themselves. That seems totally absurd economically, and even a reduction in the spirits duty would not generate enough economic growth to meet that gap.
  The hon. Member for Gordon—who has served on the Trade and Industry Select Committee—is one of the few hon. Members who studies the Committee's reports. Labour Members never read the reports, and Opposition spokesman after Opposition spokesman acts as if the information, tables and statistics contained in them are totally irrelevant—they certainly do not understand them.
  The Committee's report on the competitiveness of the manufacturing industry contained some valuable assessments of productivity levels. The hon. Member for Gordon served on the Committee during that inquiry. The Committee found that productivity in this country improved by 6.3 per cent. last year and, throughout the 1980s, the figure was 4.5 per cent. That was the fastest rate of improvement of any of the advanced nations in the 1980s—admittedly, from a lower base—apart from Japan. The rate of productivity improvement in the 1970s was 2.2 per cent.
  The shadow Chancellor is correct to refer to the relative decline—although he forgot to use the word "relative"—of the British economy. There has been a relative decline,
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  as the Government documents on competitiveness clearly point out. However, at the heart of that relative decline are the rotten levels of productivity sustained, year in, year out, under Labour Governments. That is why we are now so far behind most of our major competitors.
  On page 37 of the report there is an interesting box graph which illustrates the direct wages and the social add-on wage costs in the automobile industry across Europe. The Committee travelled to Munich and visited the BMW factory. The managers at that factory told us how they had spent two years negotiating with the unions to get rid of some of the imposed social costs. They said that they were looking forward to investing in industry in this country.
  The figures are clear: wage costs are approximately the same in the United Kingdom and in Germany, but the add-on costs are 26 per cent. in this country and 47 per cent. in Germany. The add-on costs in Sweden are 46 per cent.; in Belgium, 37 per cent.; in the United States, 33 per cent.; and in Japan, 33 per cent. We have an enormous advantage, so why do the Opposition parties wish to saddle British industry with the sorts of additional costs that Germany is trying to be rid of?
  Mr. Bruce: The hon. Gentleman is correct in his analysis. However, I attended that meeting when the managers spoke of voluntary costs, such as paying for their employees' weddings. They had agreed to meet those costs; they had nothing to do with the social chapter. Government Members must stop misrepresenting the situation. If social costs are too high in Europe, it is because countries have reached internal and domestic agreements, not because the costs have been imposed by the social chapter.
  Dr. Hampson: But it is symptomatic of the psychology and culture of industry on the continent that is part and parcel of the social chapter. The social chapter embraces that sort of thinking. European industry is trying to get rid of some social costs, so it is sheer economic lunacy to try to impose similar costs on industry in this country.
  The Chancellor referred to the fact that there has been substantial growth and that unemployment has fallen dramatically. In Leeds, in my constituency, there has been a dramatic improvement on the job front. There are now many unfilled places in the job market. I shall move from the Chancellor's Rose and Crown philosophy to the philosophy and outlook of the Fox and Hounds in Bramhope. Last week, business men told me that it is important that the Budget stimulates them to recruit new employees—particularly young people. The economy in Leeds is booming. Leeds remained successful throughout the recession, but it would still like some extra encouragement.
  In one sense, I agree with the hon. Member for Gordon. Interest rates are at the heart of it. We have to ensure that they do not go up and that our economic strategy is not at the cost of preventing lower interest rates. As has been pointed out, the Treasury still has time to make adjustments. I am in favour of tax cuts, depending on exactly where they fall, as they are part of maintaining the enterprise system. We need that degree of stimulus and reward to ensure growth. We should aim and strive for a low-tax economy, and there is scope in the Budget to move further towards it. The business men in the Fox and Hounds were asking for help with national insurance.

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  They thought that the NIC was inhibiting them taking on quite as many people. If there is still a chance, that tip and hint might go down very well.
  I should draw attention to the role of the training and enterprise councils, which represents one aspect of the success of Leeds. TECs have had a bad name from an awful lot of people, particularly Opposition Members, but in Leeds the TEC has worked extraordinarily well in partnership with the private sector and has achieved dramatic success in increasing the number of young people and adults getting qualifications and work experience, while lowering the unit costs.
  In the past three years, youth training provision has doubled and, in terms of national vocational qualifications, the Leeds TEC stands 27th out of 81. It has achieved dramatic success in increasing the number of young people getting qualifications and two and a half times as many adults go through the system. That is crucial to Leeds, where there has been enormous diversification in the city's economy, which has developed from a few stable, heavy industries to a broad range of high-tech and service sector industries, including insurance and law in particular. The city physically has benefited and gained enormously. It is vital, therefore, that the training base is developed as successfully as before and even more so. The whole country needs a more highly and broadly educated work force.
  I have some figures from the Financial Times which show that, because of inadequacies of numeracy and literacy, an estimated £5 billion costs fall on industry. When we discuss our education programme and the measures in the Queen's Speech, we must not overlook a basic fundamental failure which has continued through every Government. One in five young adults needs urgent help with numeracy and one in seven with literacy, and 35 per cent. of 21-year-olds do not have the maths skills expected of 12-year-olds in the national curriculum. Report after report comparing the standards of those leaving education at 16 shows Britain falling way behind the standards of most of our rival nations, particularly in maths.
  It is not enough to acknowledge that there is a problem; we have to deal with it and at last the Government have done something about it. Had the process of getting to grips with the problems been started earlier under the last Labour Government, we would be in a different position now.
  Mr. David Clelland: That was 16 years ago.
  Dr. Hampson: As a former teacher, I can tell the hon. Gentleman that education always has a lead time of at least 15 years. By the time a young person who enters the school system gets stimulated to take maths, for example, goes through school to college, into teacher training and back to school, different techniques have been introduced. There is a long lead time.
  Hon. Members may recall the "great debate" when Labour was in power. The then Mrs. Williams launched that great debate, following the speech of the then Prime Minister, Lord Callaghan, at Ruskin college. He said that the education service was failing the nation, particularly industry, as it was not producing enough people with the right standard of maths and so on. So there was a great debate on the national curriculum. It went all round the country to conference after conference and what
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  happened? Because the Labour party was the pawn of the teaching unions, nothing happened. They dismissed the whole thing.
  Had there been a national curriculum in the mid-1970s or had Prime Minister Wilson, after his accurate diagnosis in the 1960s that we needed the white heat of the technological revolution, done something other than put as head of the Technology Ministry a clapped-out trade union magnate—Frank Cousins—and if those opportunities had not been missed, the lead time would now be producing results. The Opposition did nothing. We had to do it and they opposed the national curriculum every inch of the way.
  When we set the standards and introduced the testing system, they opposed it. Of course the system had to settle down. It was not ideal in its early days, partly because we listened too much to the education experts with whom the Labour party is hand in glove. We have at least the basics in place, and the Queen's Speech takes the process further. We now have to ensure an awareness of learning and the seedcorn of literacy and numeracy as early as possible in the system.
  I welcome thoroughly the voucher scheme for nursery provision. Yet the Labour party in Leeds ruthlessly attacked it and therefore did not apply for the pilot scheme money. So, for political reasons alone, the Labour party in Leeds has denied families in Leeds the opportunity of a huge expansion in nursery provision as early as next year.
  According to the Audit Commission report, Leeds is not a good story in terms of nursery provision. It is below halfway down the list and requires a great deal of extra nursery provision. It simply will not do for the city group leaders in the Labour party to argue that the voucher scheme would deny the city money that it was already spending—the fact that it has not spent that much is another matter. It has to be stressed to the people of Leeds that they are missing out. If the city were producing such good nursery provision, it would not lose money under the scheme because there would be the same number of children in the schools or, if provision were so brilliant, there would be more. If nursery schools took more children, they would get more money and they would lose money only if fewer children entered the nursery education that the city provides.
  Leeds needs a more diversified provision than is offered by the city itself. Out of a total of 130 nursery schools in the city, only three are in my part of it. So two young mothers, having found that there was a waiting list of more than 260 to get their three-and-a-half-year-olds into nursery school, decided to set up their own school. It is called Clever Clogs and operates in Cookridge primary school. It represents an excellent working partnership between the state school and a private enterprise initiative. If Leeds had the voucher scheme, parents could use that school on a bigger scale.
  Other parents would be tempted to set up such new schools, but different from that one. The advantage is that a nursery provision incentive such as the voucher scheme stimulates different varieties of provision. It encourages some to be progressive and others to be more traditional. It allows parents that choice. The state provision would still exist, but parents might decide on a more progressive or traditional environment. They would be able to cash in their vouchers and enjoy a degree of choice, which would

  713
  put competitive pressure on the city council to ensure that its provision is good enough to attract parents to its schools.
  Mr. Beggs: I am pleased to hear about that excellent co-operation between parents and schools in the hon. Gentleman's constituency. I say with regret that the Department of Education in Northern Ireland would require such expensive modifications to vacant existing accommodation in primary schools that similar provision would not be possible there. Does the hon. Gentleman agree, given that children grow up in homes that do not have special toilets or hand basins for them, that massive adaptations to primary schools offering vacant accommodation are not necessary and that we should welcome provision in such locations?
  Dr. Hampson: That is a valid point in the context to which the hon. Gentleman refers, and no doubt it will be taken on board by the appropriate Ministers in operating a system with which I am not au fait.
  My final point concerns the higher end of the education system. A modern economy must offer the widest possible range and real excellence. If Labour had done anything about reforming and expanding higher education, the country's economy would be much stronger. I remind the House, and the shadow Chancellor, who has just returned to his place, that the only time since the war that the proportion of the age group entering higher education fell was under the last Labour Government. It was not high then—only 12 per cent. The figure has increased from one in eight 18-year-olds entering universities to one in three today. That target was set for 2000, but has already been achieved.
  No other Government have ever expanded opportunities for young people on such a scale. The only Administration that came anywhere near was that of Harold Macmillan, who created the last major expansion in higher education provision. The Government need to boast more about their achievement.
  Part of that expansion process involves giving financial assistance to students. The increase in their numbers could not have been funded by the traditional maintenance grant—there had to be a loans scheme, for which I argued over many years. However, I do not believe that the present scheme is operating effectively. The proposals in the Gracious Speech will help, provided that the banks are willing to participate in a generous way. Some of us called for the scheme to be operated initially through the private banking sector. That would have had the inestimable advantage of allowing the student to walk across the street to the local branch, where he probably deals with the manager about an overdraft anyway, to arrange a loan tailored to his needs. Instead, students have to operate at arm's length with a huge bureaucratic operation in Glasgow that has cocked up time and time again.
  The new head of the Student Loans Company is doing a fine job of improving it, but only 55 per cent. of eligible students are taking up loans and that is not enough. The scheme must be expanded, and I trust that the banks will be given enough freedom to allow that. Will the banks be allowed to exercise discretion over the repayment period? One disincentive of the present loans scheme is that
  714
  students must make repayments at a steady rate over five years. The worst time for any young person to repay a loan is when he has just entered into a mortgage or started family commitments, when he is at the low end of the income scale—yet faces the prospect of starting repayments at that front end. If the banks can have more freedom on repayments, we shall be on our way to funding properly the finest expansion of student opportunity that the country has ever seen—and one achieved by a Conservative, not a Labour, Government.
  As with all the education reforms that the country desperately needs, if the economy is to compete effectively, that expansion has been overseen by a Conservative Administration but frustrated year in, year out, by Labour—whether in or out of Government. The sooner the people of Leeds recognise that fact, in a city in which Labour has its dead hand on the school system, the better. A Leeds university independent report published some years ago clearly proved just what a dead hand on the primary school sector Labour had. It was nothing to do with resources, and everything to do with expectations set by the LEA and with the nature and quality of teaching in those schools. Both locally and nationally, the country must recognise that Labour has done an enormous disservice.
  6.45 pm
  Mr. James Molyneaux: I share the reservations of the right hon. Member for Worthing (Sir T. Higgins) in regard to the curious timetable in the early weeks of each new Session. That timetable, and the reasons for it, become more bewildering every year. The only advantage is that one can indulge in tendering advice to the Treasury Bench in regard to the Budget, which I shall try to do with restraint in the brief time available to me.
  In two major debates a year ago, my hon. Friend the Member for East Londonderry (Mr. Ross) and I reiterated the consistent views of our Ulster Unionist party on key aspects of the economy. They were that there should be no fixed exchange rates, which view is gaining great popularity throughout Europe; that the national debt should be repaid, which ought to be an admirable principle for individuals as well as for nations; that the Government's excellent achievement of lower inflation, on which all else depends, should be maintained; and that there should be a steady reduction in the public sector borrowing requirement, with consequential beneficial effects in many areas of our national affairs—a point made well by the hon. Member for Gordon (Mr. Bruce).
  Those objectives will not be achieved if the Chancellor yields to demands for tax reductions, which will really mean a reduction in revenue. Another serious loss of revenue resides in the expanding smuggling industry, which is reaching alarming proportions. There must be an early crackdown on those illegal activities.
  Tax reductions in particular would jeopardise the present enviable position, in which Britain's long-term fiscal prospects are the strongest in the world—although that remark may be at variance with the comments of the shadow Chancellor. A curious feature is that investors, particularly overseas, do not seem to recognise the truth of that. The Chancellor reported a significant increase in investment but much more is needed. Perhaps potential investors are paralysed by the spectre of a general election

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  that, with a bit of luck, is more than 18 months away. [HON. MEMBERS: "We agree."' Get the crystal ball out. Investors should take heart from the knowledge that we are all monetarists now.
  Some months ago, the Chancellor was correct to overrule excessive caution by the Bank of England with regard to interest rate cuts. Modest further reductions would give a much greater boost to the economy than a confetti-like scattering of tax cuts, which would have only a short-term effect. A reduction in interest rates, on the other hand, would bring lasting benefit to the construction industry, for instance. Expansion in such areas would have beneficial knock-on effects on unemployment and social security, and would soon help to reduce the PSBR.
  Not surprisingly, I found my feelings in tune with those of the right hon. Member for North Shropshire (Mr. Biffen), who has just left us, especially during his broadcast of this morning. I reflected as he spoke that he and I are the only true guardians of the right-of-centre faith left in the House.
  I shall now deal with the report by the president of the European Court of Auditors of 14 November, which commented on the amount of public moneys lost through fraud or in other ways—at least 400 million ecu, with probably more to be discovered. Careless citizens may shrug off such losses in the belief that it is all Brussels money anyway, but they are unaware that it is mainly British and German money. Losses through fraud touch directly on the very reasons for the existence of Parliament: accountability and the control of supply. A substantial cause for concern lies in the considerable errors found elsewhere when payments have been made to recipients whom the court considers ineligible for them under the programmes concerned. The errors take place in member states, where tens of thousands of national, regional and local officials are involved.
  Improved financial management and control are clearly required at all levels, but essentially responsibility for policing and disbursement of public moneys lies with national Governments—a point emphasised in the long-running saga of a certain beef scandal concerning one of Northern Ireland's close neighbours. [Laughter]. I am trying to be delicate. It is therefore extremely important to change the behaviour of member states, which should attempt not to maximise the funds that they can obtain but to gain the maximum value for money from them.
  Nowhere in the United Kingdom is this more important than in Northern Ireland, where we hear much about proposed partnerships and accountability, especially in the context of the programme for peace and reconciliation. Her Majesty's Government have a heavy responsibility to ensure that the commendable objective of partnership does not supersede the vital issue of accountability. Nor must officials usurp the authority or functions of Her Majesty's Ministers. In his exchange with the Chancellor of the Exchequer, my hon. Friend the Member for East Antrim (Mr. Beggs) made a relevant point in this regard.
  I remind the House that new and ad hoc structures do not necessarily have the in-built safeguard of long experience in meeting the close scrutiny of, say, the local authority audit. Our sound traditions and practices in those areas are worth preserving if we are not to degenerate into the laissez-faire methods that we find so unacceptable in other places.
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  Commissioner Liikanen said in Strasbourg recently:
  "Where legislative improvements and clarifications are needed the Commission, Council and Parliament have to pay more attention to the requirements for effective implementation. Simplification, clear qualified objectives, ex-ante, mid term, and ex-post evaluation, should become standard for all programmes."
  I entirely agree with that proposition.
  6.53 pm
  Mr. Tim Devlin: In welcoming the Gracious Speech I must say in passing that I was staggered to hear the hon. Member for Gordon (Mr. Bruce) say that nothing very much had changed in the past 16 years. Seventeen and 18-year-olds who will be voting next time at their first general election look at the Tories and say, "What a shower; the Labour party would do things much better." Once upon a time, not so many years ago—in 1979—I was a 17-year-old. If people think that nothing has changed in the intervening years, they must be amazingly badly informed.
  I remind the House of what was happening in the last years of the Labour Government. Rubbish was piling up in the streets because the Transport and General Workers Union did not want to collect it. There were strikes in our major industrial plants every day. The gravediggers were refusing to bury the dead. Hospital porters told people that they would vet them on their arrival at hospital to see whether they were ill enough to go in.
  It seems extraordinary now that, when people went to the shops, they never knew how much they would have to pay for goods of the same kind as they had bought the week before. The same amount of money as was spent the previous week bought less the following week. Inflation rose to the quite unbelievable level of 27 per cent. at one stage.
  Opposition Members will lean back on their Benches and say that that was old Labour, whereas they represent new Labour. I grew up in a Labour household, dedicated to the sort of socialism that the right hon. Member for Chesterfield (Mr. Benn) propounded earlier this evening. When I was young, I met a lot of people from the Labour party—all nice, idealistic types like those who sit on the Opposition Benches. They all wanted to do a good job. With their trade union backgrounds, they wanted to build a better nation. They all thought the Conservative party was making a mess of things and that everything would be better under a Labour Government.
  Matters got worse, however—dramatically worse. People of my age with small children will tell their three-year-old kid not to put his hand in the fire: "Tommy, you'll burn your hand." They tell the child the same thing two or three times, but one day when they are not looking little Tommy puts his hand in the fire and burns it. He never does it again. I think that the 16 million people who have never voted in a general election when the Labour party has won are rather like Tommy. They are going to put their hands in the fire just to see if it is really as bad as granny says it is. They are in for a shock if they do—
  Mr. Deputy Speaker (Sir Geoffrey Lofthouse): Order. It would be a good idea if the hon. Gentleman now turned to the Queen's Speech and the amendment to the Loyal Address.
  Mr. Devlin: All this is why I welcome the Queen's Speech—it builds on the achievements of the past 16 years.

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  It is staggering that the Leader of the Opposition called it irrelevant. I have always thought that a Government's first responsibility to the nation is to provide peace and security, on which score this Government stand second to none. The Queen's Speech includes three Bills that deal specifically with military security.
  Times have changed, however. In the 19th and early 20th centuries, questions of military security loomed large. Nowadays, our security is threatened not so much or so immediately from any military quarter as by an economic problem, which is why I welcome some of the economic measures both in the speech and in the forthcoming Budget. Another threat to our internal order is posed by crime and drugs, which constitute a significant threat to the peace and security of the realm. I am pleased to see measures in the Gracious Speech to tackle them as well.
  In terms of economic security, we find ourselves in a position that no Labour Government have ever been able to achieve. Inflation is under 4 per cent., and we have had one of the longest runs of low inflation that we have experienced for 30 or 40 years. Industrial investment is at an all-time high.
  I was amazed that the shadow Chancellor had not managed to find time in his busy day to look at today's Financial Times, which published an article headed
  "Industry investments reach four-year high".
  I know that the hon. Gentleman is not very good on detail, however. Let me read hon. Members the first paragraph of that report:
  "Manufacturing investment in the first quarter of the year was the highest for more than four years, official figures showed yesterday."
  I do not want to embarrass the shadow Chancellor by reading the rest of the article, but its general tenor was that Britain's economy is doing extremely well.
  Labour has now set up an industry forum. It charges companies to go along and tell its members what they do not really want to hear, hoping that they may nevertheless glean something from it. I have attended a number of such meetings. Last night, I heard Sir John Egan addressing the Air league. He told us that the only companies that would succeed in the 21st century were companies that excelled—companies that were of high quality, and did whatever they did better than anyone else in the world. Indifferent performers would not survive, he said. Europe should play to its strengths—and Britain in particular was playing to its strengths better than many of its European competitors.
  A couple of months ago I attended another forum, at which the chairman of BMW said:
  "Great Britain, for example, is currently the most attractive country among all European locations for the production of cars. This results from the structural reforms initiated by Margaret Thatcher in the early '80s, the most significant of course being the re-arrangement of industrial relations between companies and trade unions".
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  From time to time, unlike the shadow Chancellor, I look at OECD reports. The latest report states:
  "There also appears to have been an underlying improvement in the competitive position of the manufacturing sector, reflecting inter alia an influx of foreign direct investment, and an upgrading in technology and quality control standards. A competitive exchange rate and low inflation have consolidated these gains. In 1994, strong net exports further boosted output in production industries".
  Forgive me if I am getting it wrong—I am no economist—but that strikes me as a fairly glowing endorsement of Britain's current and economic performance.
  I do not want to talk about abstract measures; I want to talk about specific issues that affect my constituents. My constituents have undoubtedly been affected by the continuing fall in unemployment. That is the topic about which they always ask me, and the topic about which I worry most. I tell them that we have had month-on-month improvements in employment rates. Under Labour Governments, unemployment never fell; it always increased.
  Moreover, we in the north of England have seen the fruits of the one third of all inward investment that comes into the European Union. Recently—along with the Queen—I attended the launch of Samsung's investment in Stockton-on-Tees. I also went to the Siemens launch on Tyneside. Fujitsu has just launched a huge expansion in Newton Aycliffe, and, according to a recent edition of Electronics Weekly, the north of England has become a globally significant area for the production of semiconductors. That has happened as a result of the Government's policies.
  There is no possibility that the industrial renewal that I see when I visit factories in the north and the midlands would have come about if we still had Red Robbo and the old trade union bosses. They did not want to know. People now say that the British work force is one of the most flexible and highly skilled that can be found, and we are now exporting cars all over Europe—cars built by British workmen to better standards than those built in Japan. The north-east, and Britain as a whole, should be proud of that.
  When the Leader of the Opposition visited Newcastle university recently, he said that the north of England had made fantastic changes and he poured praise on the region for its marvellous achievements, but did he mention the Government policy that had brought that about? Did he heck. That is amazing. No one would have known that the Department of Trade and Industry had been involved in the various investments; the name of Michael Heseltine would not have passed the right hon. Gentleman's lips as he passed the site of the new Siemens factory. People do not want to know where all the good news is coming from; what they want to hear from the Labour party is that everything is wrong.
  Mr. Jimmy Hood: Will the hon. Gentleman give way?
  Mr. Devlin: I do not want to waste the House's time by listening to the hon. Gentleman, who may make his own speech if he is called.
  Not only are we living in a highly competitive country in terms of industrial relations; we are one of the most technologically advanced countries in terms of our investment in cable. I find it unbelievable that the Labour

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  party wants to sign up to a deal with British Telecom to link every school, hospital and library to the information super-highway. The Leader of the Opposition's constituency is next to mine. My constituency is currently being "cabled up" by a company called Comcast Teesside, which is connecting every school, library and hospital free of charge—not five miles from the constituency of the Leader of the Opposition. Either the right hon. Gentleman does not know, or he does not want to tell the British public. Either way, there is something very wrong with what has been going on in the Labour party.
  Labour's sole strategy now is to be an idea and commitment-free zone, as it tries its best—having paddled furiously for all these years—to let things drift and see whether the tide will take it into government. That is the ultimate counsel of despair; Labour has nothing to offer.
  I welcome the marvellous opportunity provided by the Queen's Speech for us to tackle the problem about which our constituents are most worried: crime. Having recently spent a night on the beat with the police force at Stockton-on-Tees, I know that drugs are behind a good deal of crime. Given the state in which people are brought into the cells having been arrested at 4 am, I can only pay tribute to the heroism of our police officers. If I may use that great old LSD phrase, these people are completely out of it: they do not know what they are doing. They are as high as kites on all sorts of drugs. We must do something about that.
  I believe that tackling the drug problem is the most important priority for the Government in the years to come. That is why I welcome the deployment of MI5 in the fight against drugs. I would very much welcome the redeployment of the Royal Navy in the Caribbean, where our solitary ship is doing marvellous work in tracking drugs that end up in this country. I also welcome—as will my constituents and local police force—the 5,000 extra police officers who will be deployed on the beat.
  Mr. Hood rose—
  Mr. Devlin: Before the hon. Gentleman intervenes again—perhaps to tell me about my majority—let me remind him that, in the previous Parliament, he wrote me off. He said goodbye to me, and told me that I would lose. I returned with a majority that was five times bigger and represented the largest swing in the country. That was done in the north of England, but I believe that it can be done again in all the constituencies in the south.
  Several hon. Members rose—
  Mr. Deputy Speaker: Order. I remind the House that Madam Speaker has placed a 10-minute limit on speeches between 7 pm and 9 pm.
  7.9 pm
  Mr. Ian Pearson: It is apposite that I should follow the hon. Member for Stockton, South (Mr. Devlin), who talked about election swings, because less than 12 months ago at my by-election Labour received the biggest swing in post-war history, producing a majority of more than 21,000.
  Economists tell us that, technically, we are three and a half years into a recovery. That is news to many people in my constituency. The Government should try telling it to Baggeridge Brick, a leading building materials
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  manufacturer that is now warning of meltdown if nothing is done to support the housing industry. They should try telling that to the people who are unemployed in Brierley Hill, and in Brockmoor and Pensnett, who are still suffering desperately from the decline in traditional manufacturing industries in the black country, and the complete failure to create sufficient jobs and wealth. They should try telling it, too, to the many people who are suffering from job insecurity, which far from being a state of mind, is an evident fact for the people who talk to me at my advice surgeries.
  I shall confine my remarks to four areas—economic growth, public sector accounting, the role of company profitability and inflation—and touch briefly on each in turn. First, anyone who is seriously committed to establishing high and sustainable levels of employment must recognise that the Government should set growth targets as well as inflation targets.
  There is an urgent need to raise the economy's long-term sustainable rate of economic growth by increasing investment not only in plant, equipment, buildings and other works, but in human capital. Only in that way will we reduce unemployment, by increasing the employability of the work force, and thus the underlying productivity growth of the economy.
  Secondly, the Government should use not the public sector borrowing requirement but the general government financial deficit—the GGFD—as the main indicator of fiscal stance. They should recast the public accounts in line with commercial practice. As the Minister will be aware, the GGFD is the criterion used in the Maastricht treaty as the European Union definition of Government debt for the purposes of measuring the degree of convergence between member states in advance of the single currency. So far as I am aware, in the other countries of the EU, it is accepted as the major indicator of fiscal stance.
  The Government need to speed up their review of public sector accounting, and move towards more of a private sector approach. I should like to see a Government balance sheet, profit and loss account, and a statement of source and application of funds. The distinctions between current and capital spending are still far too vague and need tightening.
  In particular, I should also like to see regionalised accounting of expenditure and assets, so that for the first time we would know how much money was being spent in each individual region. We could use that information as a starting point for establishing regional economic development strategies.
  I see no rationality in our current public expenditure system, which treats NHS trusts as public corporations but GPs as private sector unincorporated businesses. Most schools are treated as part of central Government, but grant-maintained schools are treated as part of the private sector. Like universities, they are described as private non-profit-making bodies serving persons. And I see no justification for classifying, as the public accounts do, the Bank of England banking department as a private sector financial institution.
  Thirdly, company profitability is important to economic growth. Profits and profit growth are good for the economy. Sometimes I feel that the Opposition do not

  721
  emphasise that fact sufficiently, and do not say enough about the role of profits in a social market economy—the role of profits as a signalling mechanism.
  Mr. Devlin: A signalling mechanism?
  Mr. Pearson: Yes. Standard economics says that industries making higher profits than normal tend to attract companies into those industries. Where profits are below normal, the reverse tends to apply.
  Mr. Hood: He does not understand; he is only a lawyer.
  Mr. Pearson: Do not believe it.
  Retained earnings provide the bulk of investment in small and medium-sized companies. They are also a major source of investment for many large companies. However, as the Opposition fully recognise, retained earnings do not automatically lead to a strong surge in industrial and commercial company investment. Certainly the rise in corporate profitability in 1994 did not translate into any increase in meaningful investment in the United Kingdom economy.
  Profits are also important because they fund pensions for an increasing proportion of people in the United Kingdom. I do not want to enter what is called the Dorrell debate about the level of dividend pay-outs by companies. I say only that I am not persuaded that current dividend growth is excessive; there are strong arguments why dividend growth must be maintained for the sake of long-term investment vehicles, which will be required to pay for the pensions of the future.
  My fourth topic is inflation. At present, there is a great misunderstanding about how inflation is created in the economy and about who should take the credit for reductions in inflation. A major reason why inflation has declined in the United Kingdom, as in almost every other western European country, has to do with the effects of global market competition.
  The old economics lecturers used to talk about cost push inflation and companies raising their margins when there was strong demand in an economy, thereby increasing company profitability, but today we have price-based costing, not cost-based pricing. It happens in large swathes of manufacturing industry. Ford, for example, is imposing price reductions of 5 per cent. a year on its supply chain. Companies are taking that on board, taking the price as given, re-engineering their processes and driving costs out of their products. That is a completely different rationale for business, and it means that fears about inflation over the medium term are largely misplaced.
  I await next week's Budget with interest. I expect to hear about measures to stimulate the housing market and to encourage investment and training. I should like to expect, too, that the Budget will encourage job creation and bring back job security. The people in my constituency have a right to expect that, but my deep suspicion is that we shall not see it.
  7.18 pm
  Mr. John Greenway: It is a great pleasure to be back in the House after my recent illness. If we did
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  not have a 10-minute limit on speeches, I would sing the praises of the NHS and particularly the doctors at York district hospital.
  I want to talk about the rural economy and rural affairs. That is timely, because the Government published their excellent rural White Paper last month. People in rural areas have their own views about what should be in the Budget next Tuesday, and—if it is not too late—I shall suggest a few of these to my right hon. and hon. Friends in the Treasury.
  No doubt we shall have further opportunities to debate the White Paper in detail, but it contains an important section about jobs. The White Paper asks how we can create new non-farming jobs in rural areas, and I would suggest that we add non-tourism jobs—in other words, jobs in the manufacturing sector—to that. The White Paper proposes a new "business use" class within the planning system. At best, that may be highly deregulatory, allowing no-fuss moves from farming into other enterprises. However, one envisages that it will not be quite that simple.
  There will be pressure from conservationists, local planners and some local residents, which will mean that, in reality, the process will be much more difficult. Several constraints on the number of vehicle movements and the hours of operation may be imposed on firms, and that is a real worry. We need some early action on planning guidance, followed by action on structure plans and local plans.
  My constituency is fortunate to have a number of go-ahead, enterprising manufacturing firms. Slingsby Aviation and Micro Metalsmiths are based in Kirbymoorside, while McKechnie vehicle components—which is making enormous strides, and is at present supplying Vauxhall—is based in Pickering. We also have the successful Ward business, and anybody who goes to Scarborough cannot fail to see the Ward building systems factory in Sherburn, some 10 miles west of Scarborough. We have the Malton bacon factory in, interestingly enough, Malton.
  All those firms provide an enormous contribution to local employment, but many of them were started a generation or so ago and have premises for which it is doubtful that they would get planning permission now. One has only to look round the market towns to find that land that planners had allocated for industrial use was quickly filled up by workshops and warehouses. No one is suggesting that we want to put factories all over rural areas, but the factories to which I referred and which were started a generation ago have meant a great deal to the success of the Ryedale economy. If we want a vibrant and prosperous rural economy in the future, we must not just find similar sites, but encourage similar entrepreneurs to set up.
  I shall give hon. Members another idea of the planning problems in a part of my constituency. In Scarborough borough, we have the very important and beautiful seaside town of Filey. Some hon. Members may remember that there used to be a Butlin's holiday camp at Filey, called Amtree park. On a good day in June, July or August, there might have been as many as 15,000 people on the site.
  The site is now known locally as "little Beirut" and it is totally devastated. But Scarborough borough council refused to give outline planning consent for 600 houses on the site. One might argue about the number of houses,

  723
  but by refusing the application, the council lost out on development providing up to 200 jobs. Why? Because the scheme does not fit with the local planning process. All the local people want the development, while the fact that it is covered with asbestos dust ought to fill everybody with utter horror and concern. Planning constraints mean that we are having a real struggle to sort out such a problem, of brown site that has been deeply contaminated. Clearly, something must be done.
  I wish to mention rural shops and service industries. The rural White Paper suggests that there might be a rate relief scheme for village shops. But what about market towns? Far too many small businesses and services in the retail sector are in financial difficulty because they are having to pay rent and rates based not on what they can afford, but on what the building societies and national chains think they can afford. Action is needed on that. If we mean what we say in the White Paper about ensuring that market towns have a future, the cost of rent and rates needs our attention.
  The White Paper also refers to the sparsity factor in rural areas in allocating support grant to local authorities. That is the most crucial problem affecting my constituency at present. We shall be one of the first areas to undergo local government reorganisation in April next year, when the new York district council comes on stream. Disaggregating the budgets between York and the residual Ryedale and North Yorkshire areas is proving to be a huge problem. I want to raise the matter on the Floor of House on behalf of many constituents who have written to me about it. We must have a fair distribution of the money, and we must do what we can to uphold our promise that reorganisation would not lead to a cut in local services to residents. Both Ryedale and North Yorkshire have serious problems, the latter especially.
  The first priority in the Budget next Tuesday must be a better settlement for schools. We have again had excellent examination results, according to the league tables published for North Yorkshire schools, but we cannot dig for ever into the reserves, which are depleted. Schools have used up their balances, and we need a better allocation this year. The Government must heed the warning that, if we do not honour our obligations and responsibilities to education but still cut taxes, many of our supporters will be deeply resentful.
  That said, I believe that we still must find some money to reduce taxes in the Budget next week, although not for the kind of party political advantage that the Labour party talks about. It must be obvious to anybody who looks at what is going on in their area that, while factories such as those I have talked about in my constituency are doing very well in an export-led economy, local services and the local economy are not doing so well. That economy is flat, and people need more money in their pocket. In my judgment, that can come only from a low-inflation economy, lower taxes and lower interest rates.
  If we are trying to find the money for tax reductions, we should also increase personal allowances to take a lot of low-paid people in the rural economy out of tax altogether. Our failure to uprate allowances in line with inflation over the past two or three years has brought those people into the tax system, and we ought to take them out again.
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  Finally, those who say that abolishing capital taxes—capital transfer tax and capital gains tax—is simply a way of giving money back to the rich are wholly and utterly wrong. This month's edition of Country Landowner, the journal of the Country Landowners Association, contains an article that describes how capital taxation is wrecking enterprise. It stops businesses—particularly farm enterprises and other enterprises in rural areas—from doing the kind of thing that they want to do. The capital taxation structure is too complex, and the best way to deal with it is to get rid of it completely.
  7.28 pm
  Mr. Geoffrey Robinson: I shall not follow the hon. Member for Ryedale (Mr. Greenway) down his ever-lengthening wish list, and I shudder to think what his ideas would cost. Suffice it to say, scrapping capital gains tax and inheritance tax could cost £4.6 billion by the end of the century.
  Before coming to the substance of today's aspect of the Gracious Speech, I want to refer in passing to the Asylum and Immigration Bill and a lady from the Philippines whom I am representing jointly in the House with the hon. Member for Warwick and Leamington (Sir D. Smith) and other hon. Members. Her name is Mrs. Teresita Bentley, whose permission to stay in this country was refused by the Home Secretary. I hope that the Bill will not prejudice her position and that the Home Secretary will look favourably on the representations that we have made.
  We heard today from the Chancellor an attempt to redate the period of office of the Tory Government. Some time ago, my hon. Friends will recall, 1983 was taken as the start of the period of Tory government. That was the most propitious date that the Government could find at that time. They have been forced to change that. They now take 1981 as the start. They still refuse to take the obvious starting point of 1979, when they first came to office.
  Whatever the Chancellor says, when one looks at the bare facts, the Tories' record is not one of great success, certainly not in the terms in which they have asked us to judge their performance. We did not set that standard. It was set by the former Chancellor, Lord Howe. He said that we must be judged against the relative performance of comparable countries' economies.
  The Chancellor made the point, fairly enough, that growth was a key criterion. In terms of growth, we are 13th out of the 18 G7 and EC countries. That is not much to write home about. The Chancellor referred to jobs. There are 400,000 fewer jobs now than at the time of the election in 1979. I am sure that the whole House sincerely welcomes the recent period of declining unemployment. It is good that we have had such a period. However, the simple fact is that unemployment remains 400,000 higher than it was when the Conservatives took office.
  In terms of employment creation, we are 20th out of the 24 OECD countries. In terms of male unemployment, we are fourth highest of the 15 EC countries. Since 1979, unemployment in Britain has been above the average for major industrial nations, the EU countries and the OECD countries. It is still above the average of the OECD countries, even after the welcome period of decline in the overall level. In terms of investment, we are still 21st in the league. Of the OECD countries, only Turkey has

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  fewer 18-year-olds in education than Britain. That is not a particularly sparkling economic achievement on the part of the Government.
  Let us take the precise factor on which the Government have set out to redress the balance and improve the position that they inherited—that is, taxation. There, too, their performance is poor. However, before I deal with taxation, I should like to deal with the vexed question from which the Chancellor sought to distract our attention. Why have we slipped from 13th to 18th in the league of GDP per head and purchasing power parities since the Conservative Government came to office? I am pleased to tell the House that I am aided in my argument by access to a Conservative research department brief prepared by Mr. James Walsh for the Queen's Speech debate on 22 November 1995.
  The Chancellor diligently exploited the points in Mr. Walsh's brief. Mr. Walsh wrote:
  "Labour's table is misleading and inaccurate".
  He does not tell us why. He went on to say:
  "Labour's league table is another example of their cynicism: they don't care how spurious their figures are as long as they show Britain in a poor light."
  How can we reckon Mr. Walsh's chances of promotion if he is prepared to say that, when the chart that we used was produced by the Government and signed by half the Cabinet—the Prime Minister, the Deputy Prime Minister, the Chancellor and all the rest of them? It showed precisely the figures that we have given. It was not some chart tucked away at the back of the document in some obscure appendix. It was given prime position on page 13 of the Government's key document.
  Far from the table being an irrelevant consideration, it is the most relevant of all the considerations. It shows income per head, which, in its summation, tells us about all the other aspects of policy. It is true that productivity has increased. We welcome that, but unless it leads to an increase in output per head, it is of only relative value. The total output of the economy as a whole expressed per head and in terms of purchasing power parities is a measure of the Government's success. By that standard, they are found woefully wanting.
  The Government are found equally wanting on the question of tax. The tax burden and the tax share of national income in the economy rose between 1979 and 1995, from almost 35 per cent. to more than 37 per cent. Ominously, it is the Government's own forecast that it will rise even higher, to more than 38 per cent. During the 16 years in which the Conservatives have been in office, the tax burden has averaged 37 per cent., compared with the previous averages of 36 and 34 per cent. under Labour Governments.
  A typical British family now pays more in direct tax and indirect tax than when the Conservative Government took office. That brings us to the most recent period of government by the Conservative party. The Chancellor tried his best to explain how, with a burgeoning prospective budget deficit of £50 billion, the Government could find it in them to make the statements that they did just before the previous election, which they had to reverse within the year.
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  We know that the increases in taxation that the Government have implemented come out at 7p in the pound, or getting on for £800 per family. Whatever the Government do, there is no way in which they can make good that enormous impost of taxation on the British people. What is the Conservatives' reaction? We have just heard the reaction of the hon. Member for Ryedale. The reaction to the fact that ordinary families are paying more tax than ever and that tax takes a higher percentage than ever of the income of working people across the board—not only the least well-off, but all those on average or even double average income—is to propose doing yet again something that will benefit only the very well-off at the top of the pack.
  The Government want to abolish inheritance tax and capital gains tax at a cost of £4.6 billion by the end of the century. The Government's response to the increase in the tax burden for all those who really need help is shameful. There is a similar failure on investment. In the Budget, the Chancellor intends to cut capital spending yet again. He says that it will he made up by the private finance initiative. As we know from the preceding Chancellor, the PFI was meant to achieve an increase in public expenditure, not to replace Government expenditure. So we have the prospect of a further rundown in the quality of our infrastructure. I think that all hon. Members will agree that a singular failure of successive Governments is that they have cut capital spending on the improvement of services. What we should be doing is increasing that investment.
  I shall now examine the Labour party's approach to the economy. It is wrong for Conservative Members to say that we are not beginning to evolve the policies that we shall put into practice when we form the next Administration. I do not agree with what the Liberal Democrats do. It is not appropriate to come up with a draft alternative Budget. That is not a job for the Opposition, whoever is in opposition at the time. What we must present are the policies that we intend to adopt and fill out in the period leading up to the general election.
  In terms of investment, we have already proposed doubling first-year allowances. That is a modest proposal, and I think that other Labour Members will agree with me that we could do something more than that. It is the one proven measure that really—
  Mr. Deputy Speaker: Order. Time is up.
  7.38 pm
  Mr. Barry Legg: May I begin- my remarks by welcoming my hon. Friend the Member for Ryedale (Mr. Greenway) back to the House. It is good to see him back in the House after his illness, and it was particularly good to see him give such a vigorous speech. I think that we were all greatly encouraged by his performance.
  I should like to comment on one or two other speeches that we have heard this evening. We have had an eminently sensible speech from the right hon. Member for Lagan Valley (Mr. Molyneaux). He made some very sensible comments about the balance of fiscal and monetary policy, and he made some even more interesting comments about how long he sees this Parliament lasting—some 18 months or so. Indeed, those might be the most significant comments that we hear in the Chamber this evening.

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  I also endorse the speech of my right hon. Friend the Member for Worthing (Sir T. Higgins). We will probably have three economic debates in less than three weeks. This one is less than a week from the Budget, which we will debate for a week from next Tuesday and shortly after that will be the Second Reading of the Finance Bill. Then we will probably have to wait until July for a further economic debate. The House authorities should consider the balance of our debates so that they can be held in a sensible way during the year.
  This debate, which the Opposition have chosen, is too late to influence next week's Budget. I am sure that it has been set, but I hope that the Chancellor will be able to bring more confidence to the British economy when he addresses the House next Tuesday, and impress on people how good our economic prospects are. They are extremely good indeed. There is abundant scope for tighter public expenditure. During the past few months, many of my parliamentary colleagues have set out how that can be achieved, especially my hon. Friend the Member for Bridlington (Mr. Townend) and my right hon. Friend the Member for Wokingham (Mr. Redwood). There is plenty of scope for carefully controlling public expenditure and finding further savings. Consequent on firm control of public expenditure, there is scope for tax reductions.
  My hon. Friend the Member for Ryedale was right to say that people need a bit more money in their pockets. Conservative Members believe that people are more likely to make the right decisions with their own money and to exercise their choice over spending that money. We do not believe that the Government by any means have a monopoly of wisdom. That is still a clear distinction between us and Opposition Members.
  There is scope for tax reductions next week and we also need some adjustments in monetary policy, with interest rates coming down. I do not say so for political, but for economic reasons. When we see the Red Book next week and the way in which the economy performed in 1995, compared with what was forecast last year, we will see an economy that is growing less strongly. I believe that we will see weaker domestic demand, consumer expenditure, gross domestic product growth and fixed investment than was forecast in last year's Budget.
  Significantly, we will also see a much lower GDP deflator—the measure of public sector inflation will be much lower than was forecast this time last year. That is the key reason why the spending totals for next year should be reduced and the reduction should be of the order of £7 billion to £8 billion. That is the degree of scope—[Laughter.] The hon. Member for Clydesdale (Mr. Hood) may laugh, but he once again demonstrates the ignorance of the Opposition on economic matters. It is an ignorance that stretches from the shadow Chancellor all the way down to the most humble Labour Back Bencher, who is giggling at the moment.
  When we see the figures next week, we will realise that the economy has grown less strongly in the past 12 months than was forecast in the last Budget in November 1994. If an economy is growing less strongly and has plenty of potential for further growth, as this one has, lower interest rates are the appropriate mechanism to use. During the year, we have heard arguments from the Governor of the Bank of England that interest rates should be kept high and pushed higher. Those were misjudgments and I am glad that the Chancellor overruled him.
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  That also shows that the Bank of England is not yet ready for independence. Before one makes fundamental changes to institutions, one must be confident about those changes, and the Bank of England is not in a state to be independent. For an independent bank to operate successfully, it must have a strong collegiate approach, and the Bank of England is many years away from achieving that.
  We do not need to see next week's Budget to realise how strong the deflationary pressures still are in this economy. We only have to look at the results of a major retailer, such as Sainsbury, to find that that company is under tremendous pressure to keep prices down in the high street. Those are competitive pressures.
  Look at the latest figures on stock building. Many businesses have built up stocks in the past quarter and have probably done so to a higher level than necessary. If they are to release them into the economy, they will have to be sold at very competitive prices.
  We heard a lot of nonsense about the privatised utilities from the shadow Chancellor. The Opposition want to concentrate on one issue, directors' pay, but we must consider how the utilities are operating, and the efficiencies and improvements in productivity that they are achieving.
  The shadow Chancellor said that the next electricity privatisation would only result in a £1 billion rebate for the consumer. Under Labour, there would be no rebate because that business, like every other business that has been privatised, would have been retained in the public sector. By releasing those businesses into the private sector, we have provided the mechanism to improve efficiency and productivity. What does that mean at the end of the day? Lower prices for the consumer. That would never have happened under Labour. Those lower prices will continue to come through in our retail price index figures.
  Next year we face the prospect of very low inflation levels. I suspect that RPI inflation may well be 1 per cent. What a crowning achievement for the Government to get inflation back to a level that we have not seen for 40 years. That is the prospect that we are holding out to the country. With inflation at that level we could also have significant reductions in interest rates. Low inflation and low interest rates—that is the recipe for economic success in the United Kingdom. They provide the scope for businesses to invest and not the efforts of the shadow Chancellor and his colleagues to build some airy fairy partnership with no economic framework behind it and are positive achievements that will get the economy moving at full steam, and there is plenty of scope for those during the coming year.
  There is still only one party that can provide the leadership that this country needs and one party that understands how the economy works. I have no doubt that my right hon. and learned Friend the Chancellor of the Exchequer will present a confident Budget next week, which will lead to firmer control of public expenditure and produce tax reductions and lower interest rates. That is the recipe to ensure that consumers, investors and business men achieve their full potential and that Britain takes all the opportunities in the global economy that are available to it under this Government.
  7.48 pm
  Mr. Jimmy Hood: The hon. Member for Milton Keynes, South-West (Mr. Legg) started his speech by being delighted at the prospect of another 18 months of this Government. He went on to make a speech that made him sound like a man in a condemned cell who is delighted with a reprieve. He might be delighted if he gets 18 months, but at the end of the day the condemned man will come out of that cell and will be no more.
  I compliment my hon. Friend the Member for Dunfermline, East (Mr. Brown), the shadow Chancellor, on an excellent speech and on his imaginative and refreshing approach to Labour's quest for fairness and social justice.
  I heard some comments from Conservative Members about reviewing history. Some of them were trying less to review history than rewrite it. I especially welcome the commitment of my hon. Friend the Member for Dunfermline, East to taxing millionaires who evade tax—something that Conservative Members do not want to talk about.
  I also welcome my hon. Friend's decision to impose a windfall tax on public utilities. Let us remember that we are talking about what were good public industries, which were taken out of public ownership and turned into private monopolies and which have made millions of pounds of profit off the backs of the consumer. Directors dip their dirty snouts in the trough of sleaze and we do not hear one word of criticism from the Tories.
  I particularly thank my hon. Friend the Member for Dunfermline, East for nailing the lie that this is the Government of low taxation. I welcome his initiative on the 10 per cent. rate of tax for the low-paid. He has caught the Conservatives out on that. If the Chancellor of the Exchequer's response to the shadow Chancellor's speech proved anything, it was that the Government are rattled by my hon. Friend's initiative. I compliment him on that.
  Mr. Jacques Arnold: Will the hon. Gentleman give way?
  Mr. Hood: No, I will not give way. Conservative Members did not let me intervene earlier and the hon. Gentleman was shouting and making noises, so he can sit down.
  We know that the Government's real agenda is to cut taxes next week as a bribe for the general election. However, we know, as night follows day, that the real agenda is to get over the election if they can and then hype the taxes up again. I have heard some wonderfully interesting things tonight. The hon. Member for Ryedale (Mr. Greenway) spoke about needing to put money back through tax cuts into the pockets of consumers, but who took the money out of their pockets? Who increased income tax by 7 or 8 per cent. since 1992? Then Conservative Members stand up and say that we need to put money back. Conservative Members have robbed the taxpayer and wasted the taxpayer's money, but what do we hear from them—that they are the party of good management. As the opinion polls show, we are about to see what the people think of the party of so-called good management.
  I want to discuss economic and monetary union and, in particular, the single currency. I share some of the concerns about the convergence criteria laid down by the
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  Maastricht treaty. However, in response to the discussions on the single currency that we have had during the debate on the Queen's Speech, I should say that I am no believer in throwing the baby out with the bath water. Unlike the Government's response, which is driven by a right-wing agenda from the right-wing sceptics, Labour's response is constructive, correct and in the national interest.
  In my capacity as Chairman of the Select Committee on European Legislation, I am fortunate to meet politicians from other member states as they visit this country and I visit theirs. There is equal concern in those countries about the single currency and monetary union. However, the Government are keeping us out of the debate because they are, sadly, the Government of the opt-out and the lock-out. They are locking us out of a constructive part in the debate that needs to take place in Europe about a single currency.
  I shall give an example of the responses that I have had from politicians from other member states—especially new member states. A few weeks ago, I visited Finland and Sweden, which have had different experiences since joining the Union. In Finland, food prices have gone down 10 per cent. and in Sweden they have gone up by 10 per cent. That had something to do with the state of their economies when they joined the Union. They are equally concerned about the impact of monetary union but they are keen to be part of a single currency if it happens. That is the opposite of the Government's position. The Government are not taking part in the constructive debate.
  The Government and the sceptics sometimes say that the single currency is a matter of sovereignty. I have never been persuaded by that argument. Where was the Government's concern about sovereignty when they imposed the poll tax on Scotland a year before they imposed it on England? There was no mention of the sovereignty of the Scottish people because we did not want the poll tax. The Government knew that but it was shoved down our throats and down the throats of England and Wales the next year. There was no question of sovereignty then. It was a case of, "This is Parliament. This is where decisions are made. We are the Government, we are going to have it whether you like it or not."
  What was the effect of the poll tax? We have heard a lot about the plight of the taxpayer. It cost the taxpayer £14 billion to bail the Government out of the poll tax—the equivalent of £300 per man, woman and child. This is the same Government who tell us about sovereignty. We are not going to forget the poll tax or the Government who imposed it. When the general election comes, the Government will find that out.
  Let us consider the exchange rate mechanism and whether we should go back into it. I remember how and when we went into the ERM. We went into it because the Prime Minister was corralled at an intergovernmental conference by the then Chancellor, Lord Lawson, and the then Foreign Secretary, Lord Howe, and threatened with their resignation if she did not join the ERM. She agreed but, as an act of spite to get her own back, she took the country into the ERM with a grossly overvalued pound. She wanted to impose her tool of high interests rates to keep inflation down as an act of spite. The million householders who now live in negative equity know the impact of that economic policy, because it was that single

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  act, more than anything else, that hyped up interest rates and the problems of home owners. It is important that we remember that.
  Conservative Members do not want to discuss the time when the right hon. Member for Kingston upon Thames (Mr. Lamont) was laughing in his bath. The former Chancellor of the Exchequer was singing in his bath just after he had wasted £15 billion in one day trying to prop up sterling and increased interest rates by 50 per cent., from 10 to 15 per cent. He went to his bath, had a glass of champagne, laughed and said how relieved he was. The British taxpayer carries that burden to this day. That is the burden that we are going to leave on the Government. When the general election comes, we will not rewrite history in the way that I have heard it rewritten tonight; we will remind people about the history of the Government and it is that history that will defeat them.
  7.57 pm
  Mr. Jacques Arnold: I find the comment of the hon. Member for Clydesdale (Mr. Hood) on the exchange rate mechanism rich. I sat in this Chamber when the Conservative Government decided to join the ERM. I heard the Opposition spokesman say not only that we should be in the ERM but that we should be in the narrow band. If it was a fiasco that cost the sort of money suggested by the hon. Gentleman—that is disputable—we would have had that loss and very much more had there been a Labour Government at the time.
  That is exactly the sort of the comment we had from the shadow Chancellor earlier this afternoon. I wonder how many hon. Members timed the shadow Chancellor. He took 43 minutes and his speech was an absolute smokescreen because there is a total lack of economic policy laid down by him on behalf of the Labour party.
  The hon. Gentleman spent nearly 50 per cent. of his time on the subject of corporate governance—that is the correct name for it. We may ask why. The reason ties in with the Labour party's obsession with the politics of envy. The hon. Gentleman wallowed in what he called sleaze for an immense amount of time. He talked about top people's pay and perks and he offered us no solution. Why? The reason is that these issues are very complex and quite beyond his tiny mind. Nevertheless, they are important. They must be dealt with and that is precisely why my right hon. Friend the Prime Minister appointed the Greenbury committee to go into the matter in the greatest detail. Such matters should be got right because they are a serious problem, but one to be solved by the stock exchange, by corporate investors and by the shareholders who are the very people who are being ripped off.
  The matter is complex, and it is no wonder that the shadow Chancellor did not dare to tackle it. The Greenbury committee itself got it wrong. It declared on Monday and by Thursday it admitted that it had got it wrong on a matter of detail which hit ordinary people. To suggest that the matter is simple is wrong; it is not and it must be tackled properly.
  For most of the remainder of his speech, the shadow Chancellor ran down Britain. He mocked the way in which this Conservative Government coped with the recession. The problem was serious because we faced the worst recession since the 1930s. Our tax revenue was down. How did our Conservative Government respond to
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  that? What did their predecessors, the Labour Government in the recession of the 1970s, do? They cut spending, they scrapped the hospital building programme, they cut the pay of nurses and they axed the pensioners' Christmas bonus. Is that what Labour would recommend to deal with the problem?
  This Conservative Government stuck to their growth programme in education. We are now spending, over and above inflation, more than 50 per cent. more per pupil on our schools. We are spending, over and above inflation, more than 60 per cent. more on our national health service. The Government safeguarded the pensioners from inflation right the way through the recession.
  Let us remember what the Labour party did to the pensioners. Labour changed the basis of calculation of the uprating to earnings and away from inflation. Why? The reason was that earnings lagged behind inflation under a Labour Government. They thought that the pensioners should be hurt as much as the rest of the public.
  We kept up our spending increases on health and education and we safeguarded the pensioners. How did we do it? We borrowed. Why could we borrow? We could borrow because Conservative Governments have a sound reputation for sound finance, unlike Labour Governments. We should remember that the Labour Government of the 1970s could not borrow in the markets because of their rotten reputation for unsound finance. They had to go with a begging bowl to the International Monetary Fund. This country queued up with third-world countries at the IMF. Is that the kind of Government to whom the Labour party wishes us to return?
  We kept our reputation. How did we do so? We kept our reputation because we demonstrated how we would close the deficit in Government finances. We have cut spending plans by £45 billion in the past two years or so and we also increased tax. I hear Labour Members gloating about increased tax; they believe in it, we do not. However, responsibly, taxes had to be increased without flinching despite the unpopularity of that move.
  We are now through that phase. We had 4 per cent. growth last year, and our economy is growing faster than that of France, Germany and Italy. Our inflation rate, which has been under 4 per cent. for three years, is the best for a generation. Government spending is under control and unemployment is down by 710, 000 from its peak. In my constituency of Gravesham, it is at its lowest since April 1991.
  We should compare those figures with our European partners. Unemployment is serious and rising in France. In Spain, 20 per cent. of the work force are unemployed. Under Spain's socialist Government, who abide by the social chapter, 30 per cent. of young people are unemployed. Is that what we want? The whole gamut of economic indicators, be they exports, investment, manufacturing output or consumer spending, is steadily increasing. If all is going so well, where is the feel-good factor? Why is it not yet here? The reason is the tax impact on the working family, the burdens on enterprise and the massive hangover from which the property market is suffering following the 1980s which hit the value of people's homes.
  I shall now deal with the tax impact on the working family. It is a fact that since 1979, for a single person earning, the tax burden has gone down by one tenth. Organisation for Economic Co-operation and

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  Development figures show that the tax and national insurance burden on the single earner is 26.5 per cent., which is slightly higher than the figure for the United States, but way below European Community levels. Our tax burden on the single earner is very much lower than that of our European partners.
  However, the tax burden on the married couple has shown no reduction over that period. In Britain, there is a 24.1 per cent. burden of tax and national insurance. That is very much higher than the figure for the United States, with its 19 per cent., and very much higher than the figures for France, Italy and Canada. We have a higher tax burden on the family than is the case in any of the other G7 countries, bar one.
  We should redress the balance in this Budget. We in the Conservative party believe in the working family, which is the bedrock of Britain. With the economy growing the way it is, now is the time to look at how we should put back the money in the taxpayer's pocket, whence it came in the first place. We should restore the married couple's allowance to the standard rate band, which would cost the Exchequer £2.4 billion, but there should not be an increase in the additional personal allowance for single parents with children other than those who are widowed, thus providing a disincentive to illegitimacy and divorce.
  We should introduce a capacity for non-working mothers to transfer their basic allowance to their working husbands. In 1993–94, there were 9.1 million male married taxpayers and 5.8 million tax-paying wives. That would suggest that 3.3 million wives could transfer their allowances, providing their families with young children with a tax saving of 25 per cent. on the basic allowance of £3, 445. That would mean a saving of £861 in the pockets of families, which would have a significantly greater impact on the less well-off earning families. We should concentrate on that idea.
  We must also concentrate on doing everything to support enterprise. What made this country great? It was our entrepreneurs who went out into the world to trade and invest. After all, the flag followed trade. That investment abroad is having a massive impact on our cash flow balances into this country. We are the biggest investor in the United States. We are a major player in the international markets and those investors should be supported. Next week's Budget is the opportunity to start giving back to people their own money. We should target families, small businesses and home owners.
  8.7 pm
  Mr. David Hanson: You will have to excuse me, Mr. Deputy Speaker, if I refuse to take lessons from the hon. Members for Gravesham (Mr. Arnold) and for Stockton, South (Mr. Devlin) on Labour Governments in the 1960s and 1970s. I grew up under those Governments with job security in my father's household and in a house built by a Labour Government. I went to university without having to draw a student loan and I had job security when I left university. I want a return to those days for the people whom I represent. I do not want any lessons about Labour Governments from the hon. Member for Gravesham.
  Mr. Jacques Arnold: Will the hon. Gentleman give way?
  Mr. Hanson: The hon. Gentleman can sit down because we are on a 10-minute limit today.
  The Queen's Speech and the Chancellor's speech today are missed opportunities. The Chancellor is living under a delusion and the Government are masking their failures. The economy is not as the Government would like to think it is. The Gracious Speech mentions the need for economic growth, rising employment and low inflation. No Labour Member would disagree with that, but there is a need for the Opposition to look at whether the Government's achievements to date bear witness to what they are trying to achieve in the future. From where I sit, the Conservative party is living on another planet.
  The Conservative party proclaims itself as the party dedicated to reducing the benefits bill. When my party left office, one in 12 people were dependent on benefit, but now it has risen to one in six. The Conservative party claims to be the party of low taxation, yet when my party left office average family taxation was 32.2 per cent. of gross income—now it is 35.6 per cent. As my hon. Friend the Member for Dunfermline, East (Mr. Brown) said, since the last general election income tax rates have risen effectively by 7p. Only those earning more than £64, 000 are better off as a result of the Conservatives coming to power.
  The Conservative party claims to be the party of home owners, but between 1990 and 1995 some 295, 000 people have had their homes repossessed. This very year, according to the Government's own statistics, provided in a recent parliamentary answer to me, 850, 000 people are caught in the negative equity trap. The Conservative party claims to be the party of low taxation and home owners and states that it is dedicated to reducing the benefit bill, yet, when difficult choices must be made, it remains the party that hits the poorest people in our community. The poorest 10 per cent. in our community are now 17 per cent. worse off than they were under the Labour Government, while the richest 10 per cent. are now 62 per cent. better off than they were when my party left office. One in three children are now living in poverty, yet in 1979 the figure was one in 10.
  Those figures show that the Conservative party's economic philosophy has not only failed but caused great economic and social damage to our community. As the years and months progress, the resulting tab is crippling our future economy. Unless a radically different approach is adopted, nothing will change.
  We are failing to invest in our local community. We invest half as much as Japan in our local community. We invest £863 less per head than the United States. We invest £2, 766 less per head than Switzerland. Even Portugal has a higher rate of investment per head than the United Kingdom.
  The unemployment rate is double what it was when my party left office. Today, 800, 000 people have been out of work for more than one year at a cost of £20 billion per year. What a drain on our economy. In my region, Wales, 106, 000 people are currently out of work. Unlike the claims of various Conservative Members today, the unemployment rate in my constituency has risen by 36 per cent. between 1990 and 1995. Many of the jobs that are offered in my constituency are low-paid, part-time, insecure and available on short-term contracts. They are doing nothing to build a strong future economy. One in six people remain out of work in my constituency; 18 to 24-year-olds account for 650, 000 of them.

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  All that unemployment has been created in the pursuit of low inflation. I am sure that my colleagues on the Opposition Front Bench would share the objective of low inflation, but if it is the cause of so much misery and social division, while pushing up the Government's bills on wasteful expenditure, we need to look at that strategy urgently.
  Just yesterday I received a press release from Touche Ross, which I doubt is particularly favourable to my party. Robert Ellis of the company's Cardiff office reported that the insolvency figures in Wales in October were the highest ever recorded. He said:
  "The figure this month is the worst ever recorded for October. You have to go back to January 1992 and the height of the recession for a higher monthly toll of receiverships."
  A study of the sectors in which receivership occurs reveals some dramatic figures. In the past 12 months, 52 businesses have failed in Wales; 45 failed in 1994. The miraculous pick-up in the economy has not hit my region.
  The sector that has suffered most difficulties and experienced most receiverships in the past 12 months in Wales is construction. In the 12 months to October, 12 businesses failed compared with six in the previous 12 months.
  I must emphasise that it need not be like that. The Gracious Speech could have contained measures that won the support of my party, which were designed to boost the economy, meet social need and provide reasonable and decent levels of service in the future. [HoN. MEMBERS: "What are they?"' Money could be allocated to local authorities from their capital receipts to build local council housing for rent. That would mean that the 2, 000 homeless in my constituency would be housed; employment would be offered to building workers; and the local economy would be boosted.
  In my borough council area, this year alone £800, 000 capital receipts have been taken and not one penny of them can be spent on local authority housing. That has happened at a time when construction workers are out of work. I know that it has been said before and it sounds old hat, but the basic kernel of truth is that people are unemployed and in social need while money is available that could be spent on social housing.
  Mr. Stephen Day: Will the hon. Gentleman give way?
  Mr. Hanson: No. Time does not permit me to do so.
  One in 12 homes in the United Kingdom remain unfit for habitation. Wales has the greatest proportion of such homes. Money is available that could be spent on boosting the economy, creating jobs and meeting social need.
  Further action could be taken. The Labour party has called for more investment in the information super-highway in partnership with the private sector. That directed partnership could provide key investment to create jobs, put people back to work and meet the needs of our society. We support the establishment of regional development agencies, which would create stronger economies in areas such as Wales by allowing them to draw on venture capital funds. We should invest in public transport, the infrastructure and the environment. Many public expenditure programmes could be introduced to create a competitive society that puts people back to work rather than a society in which money is wasted on huge dole queues.
  736
  There is much work that we could do, but we must look at the Government's taxation and social policies. My constituents are poorer because of the Government's policies. We need to ensure that taxation is fair. It should not be increased, but it should be fair. The Government will shortly have to choose whether to reduce the capital gains tax and the inheritance tax. They must decide whether to allow £4.6 billion to be cut from those taxes by 1999 or whether to introduce fair taxation, and use that money for productive good. I urge the Government not to cut those two taxes but to consider ways in which we can make tax fairer. For example, we have proposed cuts in the VAT on fuel, which would assist people in my constituency. We have advocated proposals to make taxation fairer.
  If there is £4.6 billion to be given away, the Opposition could list community projects on which that money could be spent, and which would create employment opportunities and improve social conditions. In doing so, we would be able to reduce the Government's overall spending on unemployment benefit and other wasteful expenditure.
  I want to see fair taxation, a fair programme of investment and—
  Mr. Deputy Speaker: Order. Time is up.
  8.17 pm
  Lady Olga Maitland: I warmly welcome the proposals in the Gracious Speech and the Government's commitment to firm financial policies. The Government have shown great courage in standing up against the national tide calling for easy options.
  The truth is that our policies have worked. We are witnessing a continual, sustainable growth in the economy. The unemployment rate is coming down steadily. In my constituency it is now down to 7 per cent. and is declining month by month. I have seen new businesses coming on stream—it is interesting to note that many of them are successfully led by women—while established ones are pressing ahead with ever greater confidence than before.
  There is, however, an area which in recent years has been an unexpected drain on national resources in both financial and social terms. I refer to the growing breakdown of the family and the consequent costs to the nation—a factor which can only concern my right hon. and learned Friend the Chancellor very much. Total spending on lone parents has leapt from £1.7 billion in 1979 to £9.1 billion for the year 1995–96. That, I should add, is 41 per cent. of our entire defence budget, which has the responsibility of looking after the security of the whole nation.
  So not only are broken families creating a disproportionate cost in financial terms, but the cost in human terms is greater. Hence the importance of considering seriously ways to boost the family. We should be doing everything possible to keep families together instead of tearing them apart at top speed, as proposed by the family law Bill.
  It would seem that we have reached a watershed in our society. What respect do we have for the institution of marriage? What role does it play in our community? Is it as relevant as before?

  737
  The family law Bill is forcing us to have a serious rethink of the type of society that we want. The Bill also poses the question: should Parliament reflect society, or should Parliament shape society? Indeed, should Parliament have a vision for society for us to aspire to?
  Parliament has had no difficulty in other aspects in trying to set standards and build up a moral base. How, otherwise, does one bring a country to fight a war? If Churchill had not set the right tone in 1939, who knows how the debate about rapprochement with Hitler, the difficulties with rationing, or body bags coming home, would have ended.
  What is for certain is that Churchill recognised that there was no easy option and firmly announced his intention—we had to fight. We added that the going would be tough, with
  "blood, toil, tears, and sweat."
  Similarly, we need to have a vision for our society today, and that means a vision for the family. Nurturing the family also means blood, toil, tears and sweat.
  No one can deny the urgency of taking a close look at the family today. This nation has bred a growing disembodied family at the rate of 150, 000 couples divorcing a year—the highest rate in Europe. Add to that the 1.5 million "never married" single parents with 2.5 million children and we become aware of the scale of what is before us.
  Are we really content to create more legislation to hasten the process even further? Have we really taken into account the fact that the costs of even more broken families will only be an increasing burden on the state and therefore the economy? History has shown us that divorce has become easier with every piece of legislation that is passed, so more broken families have been thrust into society.
  At whose behest is the family law Bill being introduced? Have there been mass demonstrations in Hyde park calling for it? Where are the vociferous lobbies calling for swifter, easier divorce? Have the children, the neglected VIPs in those scenarios, been crying out for yet more rapid break-ups of their homes? The answer is that the Law Commission, in its infinite wisdom, has decided that it would be humane to end marriages swiftly and painlessly and to
  "reduce the trauma for the children".
  That is an escape clause for guilt-ridden parents. The trauma for the children is the break-up of the family home. The legal process is immaterial.
  The real issue is the value that we place on marriage in today's society. Only when we come to terms with that can we think clearly about how and when it should end. If we decide that marriage is a short-term arrangement of mutual convenience to two people—with children as an option—then for the secular-minded it is plain logic that, when it falls apart, it should be ended as expeditiously and seamlessly as possible.
  However, there is another opinion. Marriage is the foundation stone of society and it carries with it responsibility. Stable families bringing up children in emotional security can only be of benefit to society as a whole.
  738
  Marriage is not merely a contract between two people. It is a contract witnessed by society on behalf of the community at large. We are not farmyard animals. We do not approve of people living by an amoral code. We govern our lives according to an accepted framework, which seems to work pretty well. Breaking the law is an offence. We pay our taxes. We drive on the correct side of the road and so on.
  Marriage, however, which is the bedrock of our society, seems to have no such boundaries. When it breaks down, it is a misfortune for the couple concerned. The reasoning, "Why keep a dead marriage alive?" means a hasty divorce, which, under the new proposals, will move from speedy to complete overdrive.
  What really disturbs me is that, while the debate has raged in the past few weeks, I have heard scant concern expressed about the children's well-being. The oft-repeated phrase, "They are very understanding and adult" does not wash. It reflects self-absorbed people seeking to gloss over an inconvenience.
  In truth, the children pay a heavy price. If one asks any teacher about the problems of dealing with distressed children whose parents have split up, one will hear of children, if small, becoming clingy and attention-seeking. In any case, they lose confidence, cry easily, lose concentration and fall back in class. Later, some never settle down. They fall out of the social swim and turn to crime, drugs, early pregnancies and so on.
  Study after study has demonstrated the ill effects of divorce on children. So prevalent is the break-up of the family that another nightmare falls on children, as emphasised by Ruth Deech, principal of St. Anne's college, Oxford and a specialist in divorce and family law. In a paper on Lord Mackay's proposals, she drew our attention to a MORI survey for Reader's Digest last month, showing the fear held by many children that their parents will separate, and the years of longing on the part of those children whose parents have parted that they will be reunited.
  Medical Research Council studies carried out over decades have shown that children whose parents divorce have less good life chances—poorer health, fewer jobs, more children born out of wedlock. They are less likely to finish school and have more broken marriages in the next generation, with all the resulting social security costs borne by the taxpayer.
  Under the proposed new law, marriage will be ended with less formality than the hiring of a car: if you do not like the spouse after all, send her home. That bedrock of our society, marriage, from which everything flows in a civilised world, will be irretrievably damaged if we surge ahead at break-neck speed to end in a single year a commitment that had been made for life.
  If nothing else will move liberal-minded thinkers, I beg them to consider the hapless victims—the children who have no say in the matter. They suffer, and in the end so do we all.
  I urge the Chancellor to give very careful consideration to the growing costs of increasing broken families, and make his own representations to the Lord Chancellor, whose Bill will do so much to undermine his own excellent work in securing a firm financial base for the country.
  8.27 pm
  Mr. Andrew Miller: It is

  739
  always a pleasure to follow the hon. Member for Sutton and Cheam (Lady Olga Maitland) because it brings us back from "Alice in Wonderland" to the real world. I often wonder, when I drive through Sutton and Cheam occasionally, in which part of Sutton and Cheam the hon. Lady finds those examples, because I do not believe that people in her constituency accept her model of the world.
  It is curious that the debate on the royal speech has not received a great deal of press coverage. We all know the reason for that. A friend of mine suggested to me that the hon. Member for Crawley (Mr. Soames) is on the carpet in front of the Prime Minister for daring to attack the Princess of Wales. She kept the Queen's Speech out of the media.
  However, some serious things have been discussed in the past few days and it is a great pity that the debate has not had a great deal more coverage.
  Let me start with nursery education, the bedrock of our investment in the future, in people, in our society.
  What has happened? There was a pilot scheme for vouchers—the Government decided to start with a pilot scheme for a change. After all the experiments in social planning had gone disastrously wrong, perhaps the Government thought that it was a good idea to have a pilot scheme instead of going full blast into a new programme that collapses in disarray. What was that pilot scheme? It was offered to local authorities to take up. Time after time we have heard criticisms of Labour and Liberal-controlled local authorities for failing to take up that programme.
  Mr. Jacques Arnold: Quite right.
  Mr. Miller: The hon. Gentleman says, "Quite right." That is interesting—perhaps he can say why Conservative-controlled Cheshire county council also refused the pilot scheme. It refused the scheme because it was bound to fail—
  Mr. Arnold: Will the hon. Gentleman give way?
  Mr. Miller: I shall not give way as the hon. Gentleman does not represent Cheshire.
  Mr. Arnold rose—
  Mr. Miller: Oh, very well. I shall give way.
  Mr. Arnold: Cheshire county council did not take up the scheme for precisely the same reason as can be clearly seen in Kent. We have always pioneered projects; the only time that we did not do so in my county of Kent—which is one that I know about—was precisely because it is controlled by Labour and the Liberal Democrats, who are under instructions not to participate in the scheme. Poor old Kent.
  Mr. Miller: The hon. Gentleman is clearly not listening. Cheshire county council is one of the last bastions of Conservative administration and it refused to adopt the programme.
  Mr. Peter Butler: Cheshire county council is not Conservative-controlled.
  Mr. Miller: Cheshire is Conservative-controlled; I represent a Cheshire constituency, so I should know.
  The Conservative party has rejected the pilot scheme. The issue needs to be considered in terms of the overall programme of investment in education which is not taking place throughout that county. It is interesting that there is an all-party alliance—all three major parties working together to seek to persuade the Government that they are wrong. That is an interesting little concept about which we never hear from the Conservative Benches. All we ever hear are criticisms of Labour-controlled authorities which are seeking to do their best in impossible circumstances.
  Earlier we heard about one aspect of investment. I listened briefly to the contribution of the hon. Member for Stockton, South (Mr. Devlin) who criticised the Labour party for having discussions with British Telecom. He has the gall to criticise the Labour party for talking about investment in the nation's future. It seems extraordinary that, when the Labour party starts to promote ideas that will create competition, it becomes the subject of criticism from Conservative Members.
  Last year, we heard the Deputy Prime Minister, on his crusade for deregulation, say that every regulation had to be wiped out of industry's way. But when it comes to British Telecom, he says that the asymmetry rules must stay in place. Those rules were devised in 1984, when they may have had some logic—history will determine whether they did—but by the time those small cable companies were taken over by American multinationals, the logic had disappeared. There must be an agreed and phased programme of release from those regulations on a region-by-region basis, which is what the Labour party was saying. It is extraordinary that a mechanism to create greater competition in one of the industries that will provide the basis for the regeneration of the British economy has been criticised by Conservative Members.
  On several occasions I have heard criticisms of industrial relations under previous Labour Administrations. I have heard the phrase "Red Robbo" used about six times—it must have been in a Conservative party handout which I have not seen. I met a group of trade unionists from Slovakia just yesterday who were complaining bitterly about the problems they faced in making progress with some of the multinational companies in their country. I asked them specifically, as did my hon. Friend the Member for Coventry, North-East (Mr. Ainsworth), how they ensured that trade unions were recognised. They said that it only took five people to be in the union and it would be recognised. In this society we have destroyed all rights of recognition.
  Mr. Butler: Hear, hear.
  Mr. Miller: The hon. Gentleman says, "Hear, hear." We have destroyed all rights of recognition and the Government now claim that as the basis for making progress. How can removing rights at the workplace be the basis for progress?
  We have heard about transport issues. In my constituency, large and successful businesses are desperately crying out for investment in the west coast main line. Two Budgets ago promises were made. It was

  741
  said that magical private sector money would rescue the west coast main line. Where is it? Not one penny piece of that money has emerged so far. How can businesses such as Shell, Vauxhall and Kemira, which desperately want to get to the market place by improving the rail infrastructure, he expected to make the sort of contribution that they could have made had that investment gone ahead?
  My hon. Friend the Member for Delyn (Mr. Hanson) talked about the failure to invest in housing. In my constituency, 4, 500 families are on the housing waiting list—an extraordinary number. An authority that as recently as 1986 could guarantee to any family—
  Mr. Stephen Day: On a point of order, Mr. Deputy Speaker. I wish to be helpful to the hon. Gentleman, who has I think misled the House—I am sure not intentionally. Cheshire county council is Labour-controlled. Perhaps the hon. Gentleman would like to correct what he told the House.
  Mr. Miller: I stick to my guns, and the record will prove that.
  Investment in housing is important. Some 4, 500 families are waiting on the housing register in my constituency. As recently as 1986, a couple with one child would have been housed within one month; it now takes four years. That is as a direct result of this Administration's failure to invest in the housing infrastructure. The money is there and only if it is released on a phased basis will we achieve progress in providing low-cost, affordable housing. Such investment will result in the sort of progress that we need to house those people and revitalise the building industry. That would have an enormous spin-off effect on a wide range of industries across the country.
  Everyone who drives up the motorway or travels on the train through Bedfordshire will see the problems faced by industry—
  Mr. Deputy Speaker: Order.
  8.38 pm
  Mr. Stephen Day: I shall take the opportunity, at the beginning of my speech, to give the hon. Member for Ellesmere Port and Neston (Mr. Miller) the information to allow him to correct what he said. I am a Greater Manchester Member of Parliament, but my postal address is Cheshire and my understanding is that the Conservatives hold 22 seats, Labour 35 and the Liberal Democrats 14 on Cheshire county council. It is only right to put those facts before the House. I should like to think that such circumstances led to Conservative control. If they did, we would be in control of many authorities.
  I welcome the Loyal Address. During the debate this evening, many Labour Members have done nothing but run Britain down. I think that my Whips will agree that, on occasion, I have rebelled when I did not believe that my Government had got it quite right. However, it should not be inferred that I, or any other Conservative Member who has occasionally disagreed with the Government, believe that the Conservative Government have been anything but good for the British people since 1979.
  742
  I do not recognise the picture that Labour Members have painted of Britain before 1979. I went to school and on to further education during the 1960s, and I remember Labour Britain well. It is an experience that I do not wish to repeat. I remember a Britain where industry created more jobs than there are now, but unfortunately—especially for those who ultimately lost their jobs—that industry produced goods that the rest of the world did not want to buy at a price that the rest of the world could not afford. That reality, and not Conservative Government, cost people their jobs.
  Companies struggled under the economic regime imposed by a Labour Government and many industries were put under public ownership. I remember well companies such as British Steel and British Leyland that were cobbled together by a Labour Government. They were a disaster for their own long-term future and a disaster for all who worked in them. The companies were almost destroyed. It was a Conservative Government who privatised those industries and turned them into successes. They are the real benefits of Conservative Government for Britain since 1979.
  I remember when the Labour party went to the International Monetary Fund. It would embarrass anyone with pride in Britain to see any Government of any political persuasion grovelling before the IMF, with the economy in a mess. I remember an inflation rate of 27 per cent. in Britain. I remember that at one point the highest rate of taxation reached 97.5p in the pound. That is a typical result of Labour attitudes to taxation and to the economy. Labour policies produce not growth but the devastation that was Britain in the 1970s. I do not believe that the British people wish to return to that situation. They will reflect upon that in the polling booths, and vote accordingly.
  There were calls for local authorities to be allowed to use receipts from council house sales to invest—that is a magic word beloved of Labour Members. Labour Members do not seem to understand that the proceeds of council house sales must he offset against the massive debts incurred by local authorities. Local people face enormous cost burdens largely because of the mismanagement of Labour-controlled authorities. The debt burden is enormous, and the Labour party cannot ignore that if it claims to believe in financial rectitude and good management of the economy.
  Labour has proved again tonight that it is unfit to run a market stall, let alone an economy. It does not understand what wealth creation is all about. People have the talents and the Government must release those talents so that the people can create wealth. The people do not need politicians to direct them. The last thing they need is a Labour Government trying to control the economy, telling people how to spend their money and telling businesses where to invest. The people will make the right decisions in that regard. This Loyal Address proves that the Conservative Government hold basic, clear principles that are right not only in theory, but have been proved right in practice ever since the Government were elected.
  I am proud to be a Back Bencher in this Conservative Government. Much mockery was made of an earlier comment that this Parliament may yet run 18 months. However long it runs, I hope that, at the next election, the people will do what they have done in the past, in spite of the pollsters' predictions: return a Government who are capable of running the economy.
  8.45 pm
  Mr. Brian H. Donohoe: The hon. Member for Cheadle (Mr. Day) said that he was a product of Labour and, judging from his speech tonight, he has not done too badly.
  The Gracious Speech is paper thin as far as Scotland is concerned; it contains nothing of any meaning for Scotland. Two days after the Queen's Speech, the Secretary of State introduced a hare-brained scheme to engender some alternative to our well-thought-out proposals for a Scottish Assembly. The Government have no idea about the future of Scotland—the land in which I was born and which I shall always be proud to represent.
  The Government cannot deal with the education problems in Scotland. Many children in Scotland, who receive little education and no training, find that there are no jobs in Scotland. Education without training and jobs is worthless. As a result, we have seen a rising culture of drug taking and crime in our society. The Government are responsible for those problems; no one could suggest that it is the fault of anyone else. I see those problems in my constituency and they exist throughout Scotland.
  There is no point in trying to encourage the youngsters in our communities if we cannot provide them with real training. A company has recently commenced operations in my constituency and it has brought a number of jobs to the area. I visited that company a few weeks ago and I met the owner. He told me that he is not able to fill the positions in that factory because of a lack of training. He has plenty of desks and machines, but he does not have bodies to operate those machines.
  That lad was conned by the Scottish Office and by Ayrshire Enterprise about the number of suitably trained people in the Ayrshire area. He has had to consider bussing people from the north and the east to the south of the county. He could employ 100 people tomorrow and meet his production requirements, but he cannot recruit suitable workers because of the lack of training in the local area. That problem should have been addressed before now.
  We must also contend with the ill-thought-out reorganisation of local government in Scotland. The constraints that will be placed on the resources of the new authorities are now coming to light. The Government have not given the new authorities any assurances that their financial requirements will be met. Education and training needs have not been addressed. There will be immense problems in social work in respect of achieving any possible attachment to the needs of my constituents. That is another clear sign of an incompetent Government who have nothing to offer the people of Scotland.
  We are also witnessing the breakdown of the national health service. I was born the year that the national health service came into being and, in the final years of the current Government, it is breaking down completely. Nothing is left of the dreams of those who created the national health service.
  Mr. Jim Cunningham: Does my hon. Friend agree that one of the problems in the national health service that the Government have not addressed—it could be argued that they have exacerbated
  744
  it—concerns the long hours worked by nurses and doctors in the national health service and their lack of incentive to do a good job?
  Mr. Donohoe: My hon. Friend is absolutely right. While nurses, and other staff, are restricted to pay rises of some 3 per cent. per annum, general managers in the trusts and the health boards of Scotland award themselves increases of up to 25 per cent. There is something fundamentally flawed in a system that allows that to continue. The issue clearly needs to be addressed, and it is not likely to happen under any circumstances where we have a Tory Government.
  In my constituency, what I understood to be a national health service is being broken up ant private hospitals are running almost all geriatric services. If the Tories thought that they could get away with it, they would privatise the birth of children. I am not so sure that that is not the next option that the Secretary of State for Health will consider.
  My constituency also has problems with housing. The development corporation in the new town was enormously successful for 25 years. It created jobs and wealth, it attempted to address the lack of training in the area and it built particularly good housing. All that achievement has been lost because of the Government and their madcap ideas. They want to diversify the housing stock. They do not want the same as the public.
  The tenants living in those houses want to be transferred to the local authority. That was proved by clear experience in other new towns in Scotland. A ballot revealed that 97 per cent. of people in East Kilbride believed that the only useful alternative to their continuing in the rented sector was to transfer to the local authority. [Interruption.] Does the Under-Secretary of State for Scotland, the hon. Member for Aberdeen, South (Mr. Robertson) want me to give way? Clearly, he does not understand his own brief, because he has never answered the points that I have raised with him in Scottish Questions.
  Why should so many resources—some £350 million—be wasted on a housing association in Irvine when nobody seems to know whom it represents? Why should all that money be spent trying to entice people away from what they know is good for them to the unknown—away from secured tenancies to assured tenancies? My constituents will not be conned.
  In the past 16 years, what have we gained from a Tory Government? We have experienced growth of some 1.7 per cent. How can we possibly compete in the world market when we are hitting such a growth figure? Earlier this evening, I had a discussion with representatives of ICI, which is a very successful company. It is not so successful in my constituency, where its employment figures have fallen from 13, 000 jobs in Stevenston to some 600 today. That does not suggest that the country has encouraged ICI to continue as an employer in my constituency.
  Politicians on both sides of the House do not understand what is happening in the commercial markets of the world. Commercial companies have become transnational. Individual companies do not concern themselves unduly with what politicians have to say. Instead of all the discussion about sleaze, and Conservative Members taking money for advising industry on how to go about its business, we should look

  745
  at industry to learn something about how we should conduct our business in politics. Clearly, Britain is old fashioned in that respect. We have to turn ourselves around and adopt an agenda that people on the streets understand and that will get them all back to work.
  8.55 pm
  Mr. Thomas Graham: I have a new pair of glasses and, as they are bifocals, I am having some difficulty in using them.
  I found the Queen's Speech extremely difficult to understand. It is quite extraordinary, to say the least, given the problems facing Britain and those facing my constituents. In the past fortnight, I have looked at my mailbag and I shall tell the House what was in it—not the Queen's Speech, but letters from people who are deeply worried about the effects of the Child Support Agency on their families. My constituents have undergone traumatic experiences and are still writing to me about their unsolved problems.
  I also received a number of letters about transport. The Government's deregulation of the buses has caused enormous problems in rural areas. My constituents are finding it difficult to get to work in the morning and back in the evening because of the lack of bus services. Not everyone owns a motor car; therefore public transport is extremely important. Those are the issues about which I find letters in my mailbag.
  Once again, there are tremendous problems with the national health service in my constituency and that of my hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman). The waiting lists are unbelievable. There is a waiting list of between nine months and a year for a man with a heart problem. He should be seen this week and treated immediately so that his problem can be cured. Those are the issues that folk want to see in the Queen's Speech. They want my constituent to have an operation on his heart. They want the waiting list to be cut effectively, not a manipulation of the figures.
  My folk are worried about young people. The Under-Secretary of State for Scotland, the hon. Member for Aberdeen, South (Mr. Robertson) is nodding his head, but education in Scotland is his portfolio. I know young folk who want to go to college but cannot get the wherewithal to do so. The local college does not receive Government support, so young people in my area are being denied the right to take themselves off the dole and to seek further education.
  One young girl in my constituency who is an incredible asset to Scotland—she is a great actress—has been offered a place in a college in England, but she cannot get funding. So what will happen to her? Her family cannot afford to send her to college, but the Government can. They should pay for young kids to go to college. Those are the measures that we should see in the Queen's Speech.
  I remember the last time I read a poem out of a certain book. I wish that the Chancellor were here tonight, as I am about to read another one. This is from "Hairy Knees and Heather Hills" by the famous Walter McCorrisken. Walter sums up the Government in this wee poem.
  746

  "A miser from downtown Rangoon,

  Drank soup through a hole in a spoon.

  Said he with a smile,

  It's really worth while,

  For the soup I save is a boon."

  That epitomises the Government, how they operate, and the Chancellor's regime. The Government do not realise that they must spend money to get Britain out of its problems. Providing employment for young people takes money and investment in education and training. That is the way forward.
  The Queen's Speech should have given hope for Britain, and it should have given young folk pride, knowing that they would leave school, college or university and go into training that would give them a job. I make no bones about it. Every Member of Parliament has a job. Some do it well and some do it badly, but that makes no difference because we all collect a salary. Too many young graduates and other decent young men and women who have worked hard to pass their college exams to make a contribution to society are denied that opportunity by the madness of this Government.
  After 16 years, the Tory party is still putting out bumf, such as a circular that I saw this week. I am sure that all Conservative Members have a copy. If not, I will make sure that they receive one. That circular says that Government's key objective is a centralist strategy aimed at not risking inflation, and at ending the days of boom and bust. After 16 years, the Government have the audacity to produce something like that, while constituents of mine—young people who have only ever seen that lot in government—are, through no fault of their own, languishing on the dole The Queen's Speech offers them no hope and nothing for the future.
  I shall quote another poem from Walter McCorrisken:

  "Dear Sir,

  Never bite your finger nails,

  It makes your fingers lumpy,

  Never bite your finger nails,

  Yours sincerely, Stumpy."

  That further reminds me of the Government, who are worried because they know that a general election is coming. They know also that the next Queen's Speech will be meaningful. They know that that Queen's Speech will offer young people the hope of carrying the flag and offer elderly folk in retirement a chance to enjoy a decent standard of living. If the Government do not look after the young, there will be nobody to look after the elderly.
  The Government have abandoned their commitment to young people. Worse still, this week I received letters from elderly people asking why the Government could not put something in the Queen's Speech about abolishing value added tax on domestic fuel. Why could not the Queen's Speech have offered the elderly some hope this winter?
  I remember the winter of discontent, but this winter many old folk will not wake in the morning. There will be a tap on the door that they will never hear. Eventually, the police or social worker will be told but, unfortunately, those elderly people will have a died because they did not have enough to heat their homes or to eat. They are forgotten individuals. That is the winter that those old people are facing.

  747
  The Queen's Speech did not talk about the young, the elderly or the future of Britain because the Government have abandoned them all in favour of the pathetic policies of a dyed-in-the-wool, heartless Government.
  Hon. Members: More.
  9.4 pm
  Mrs, Ann Taylor: I understand hon. Members' wanting to hear more from my hon. Friend the Member for Renfrew, West and Inverclyde (Mr. Graham). His speech was direct and came from the heart. They would do well to listen to his underlying message.
  We have had a wide-ranging debate, touching on
  Mr. Robert G. Hughes: Will the hon. Lady give way?
  Mrs. Taylor: I have only just started my preamble, but I shall.
  Mr. Hughes: I am grateful to the hon. Lady. She played a leading part in changing the Standing Orders, particularly those relating to the declaration of hon. Members' interests. Perhaps this was an oversight, but I fail to understand why the hon. Lady—unlike her party's Chief Whip and deputy leader—has not declared an interest in one of the amendments tabled by Labour. The hon. Lady has a relevant interest but she has not declared it.
  Mrs. Taylor: The hon. Gentleman should withdraw that remark because I have no interest relevant to the debate. Those names shown with the letter R against them have been so identified after the procedure was cleared with the Parliamentary Commissioner for Standards. Labour Members are clear about the rules. If the hon. Gentleman has any questions, he should not raise them in the House but with the parliamentary commissioner. I assure the hon. Gentleman that his allegation is incorrect and I invite him to withdraw it.
  Mr. Hughes: The hon. Lady says that, but she nevertheless has an interest that I regard as relevant, relating to that which she receives from the Association of Teachers and Lecturers and from Unison. While I am on the subject, I think that the sponsorship of the Labour party leader by the Transport and General Workers Union is also relevant.
  Mrs. Taylor: This is a typical abuse by certain hon. Members, who are trying to mislead people about the amendment. I say to the House, and to the hon. Gentleman in particular, that the procedure that the Opposition followed in tabling the amendment, in relation to the registration of interests, has been cleared in detail with the parliamentary commissioner, who was appointed to take notice of those issues. It is a matter for him. If the hon. Gentleman does not understand that, he ought to go away and read the reports so that he understands the system that we introduced about a week ago.
  Several hon. Members rose—
  Mr. Deputy Speaker (Mr. Michael Morris): Order. Hon. Members should be clear that if they have a complaint in relation to registration, it should be raised with the parliamentary commissioner. Such a complaint is not for debate this evening. We will return to the Gracious Speech.
  Mr. John Marshall: On a point of order, Mr. Deputy Speaker.
  Mr. Deputy Speaker: I have given my ruling. I hope that the hon. Gentleman is raising a point of order on a different matter.
  Mr. Marshall: Mr. Deputy Speaker—
  Mr. Deputy Speaker: Order. Is it a different matter? No. I call Mrs. Taylor.
  Mr. Marshall: I wanted your advice, Mr. Deputy Speaker.
  Mr. Deputy Speaker: Order.
  Mrs. Taylor: Thank you, Mr. Deputy Speaker, for confirming the interpretation that I gave the House.
  As I was trying to say before the hon. Gentleman so misleadingly interrupted—
  Mr. Anthony Coombs rose—
  Mrs. Taylor: I shall not give way. I intend to make my speech, not to answer irrelevant interventions which you, Mr. Deputy Speaker, have already ruled out of order.
  Mr. Day: On a point of order, Mr. Deputy Speaker.
  Mr. Deputy Speaker: Order. I hope it is a new point of order.
  Mr. Day: I want to correct a point of order that I raised earlier. The House will recall that, earlier this evening, the hon. Member for Ellesmere Port and Neston (Mr. Miller) claimed that Cheshire county council was Conservative-controlled. I rose to put the record straight, on the basis of the seats allocated to each party. The information that I imparted to the House was correct: there are 22 Conservatives, 35 Labour councillors and 14 Liberal Democrats.
  It has since been brought to my attention, however, that the chairman of the authority is indeed a Conservative. I understand that that is the result of some deal struck between the Liberal Democrats and the Conservatives. I thought it only right to put the record straight, and if I gave any offence to the hon. Gentleman, I apologise.
  Mr. Deputy Speaker: I am most grateful.
  Mr. Miller: Further to that point of order, Mr. Deputy Speaker. I am grateful for the hon. Gentleman's comments and I do not blame him for what he said, although it was not a strong point in favour of the Conservative party.
  Mrs. Taylor: If we could now return to the debate, that would be of benefit to the House.
  We have heard the hon. Member for Ryedale (Mr. Greenway), for example, whom we are glad to see back with us following his illness, speak about local government reorganisation. We have also heard speeches on housing and the family. I would hesitate before trying to follow the cultural contribution of my hon. Friend the Member for Renfrew, West and Inverclyde; suffice it to say that many of the problems that he related are known to the constituents of many other hon. Members. I think in particular of the many difficulties that my constituents have experienced with the Child Support Agency—my hon. Friend highlighted some of them.

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  I start by reminding the House of the comments made by the Lord President on Queen's Speech debates. He wrote recently that the Queen's Speech is always an important signpost to the political year. That is true. This year, the wording on the signpost is large and clear: "General election this way". What is more, as everyone now knows, the sign writer this year was the chairman of the Conservative party. For the first time, the briefing on the eve of the Queen's Speech was given not by the Leader of the House but by the chairman of the Conservative party, who cynically told journalists of his strategy—that the speech had been drawn up to put Labour on the spot and to challenge the Labour leader after his warm words to the CBI.
  As we all know, few things happen in Parliament that are not either openly political or have heavy political overtones, but we have surely reached new depths of cynicism when the whole thrust of the Queen's Speech becomes an exercise in party political point scoring.
  What Ministers should recognise—although after 17 years of assuming a divine right to rule I doubt they do—is that Parliament is not an annex of Tory central office, and that the law-making process of this House should not be a crude extension of the writing of a party manifesto.
  This evening, one of the least confrontational Ministers, the Leader of the House, is to wind up our debate. We may at last, therefore, hear something constructive. The right hon. Gentleman acknowledged in an article in The House Magazine this week that certain Bills were included in the Queen's Speech by agreement between our two parties' Front-Bench spokesmen. He drew attention to the consultation that had taken place on the drafts of the Armed Forces Bill and the Reserve Forces Bill. He also mentioned the offer that I made at business questions last year to facilitate the speedy passage of the Bill ratifying the chemical weapons convention, so he will acknowledge that there are occasions when the House can work constructively when there is agreement in principle on a certain issue.
  That brings me to the Asylum and Immigration Bill. The Leader of the House knows from my evidence to the Procedure Committee in June that I favour a greater use of Special Standing Committees. So, I believe, does he in some circumstances. We were told yesterday—we have been told it on other occasions—that the offer of a Special Standing Committee made by my right hon. Friend the Leader of the Opposition on the first day of this debate could not be accepted because the Bill was controversial and Special Standing Committees could not to be used for that purpose. I disagree with that analysis; I do not think that that was ever the presumption.
  During the passage of what became the Water Act 1989, which privatised the water industry, it was suggested that a Special Standing Committee should be established, despite our opposition to the privatisation. The first part of the Bill created the National Rivers Authority, in which, on principle, there was agreement. The suggestion of a Special Standing Committee was not accepted, but I believe that the legislation would have been better if it had been.
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  Even if the Prime Minister is right to believe that Special Standing Committees are used only for non-controversial Bills, we must ask what makes the Asylum and Immigration Bill controversial. On Wednesday, the Prime Minister said that it would
  "ensure that we have a fair system of asylum—fair for those who need help, and fair for those who do not believe that this country should receive bogus asylum seekers either."
  On the same occasion, the Leader of the Opposition said:
  "We oppose bogus applications and fraud and we recognise the need for immigration controls".—[Official Report, 15 November 1995; Vol. 267, c. 17–30.]
  There was apparent agreement between them.
  It must also be agreed by hon. Members on both sides of the House that the Asylum and Immigration Appeals Act 1993 was flawed, and that the Government got it wrong then; otherwise, there would be no need for new measures now. The question is, what is required? Do we need administrative change to deal with the backlog of applications, or do we need more fundamental changes in the system? If there is agreement on the objective, as the Prime Minister has said, why should we not try to achieve that objective in productive ways?
  If, however, the purpose of the Asylum and Immigration Bill is to act as a vehicle for extreme statements about race relations—such as those made by Andrew Lansley, a prospective Conservative parliamentary candidate who has talked openly of the political benefits of playing the race card, saying that immigration has the potential to hurt the Labour party—the Bill will not achieve the Prime Minister's stated objective of improving race relations.
  Moreover, the Prime Minister and others ought to bear in mind the existence of real practical problems with the proposed legislation. Ministers should know that, not least because the Secretary of State for Education and Employment has pointed it out. She has said that she agrees in principle with deterring illegal working, adding:
  "I do, however, have some concerns … Either way there could be racial discrimination … A balance needs to be found between the benefits achieved by such a scheme and the burden it would place on employers".
  I suggest to the Leader of the House that, if the Secretary of State for Education and Employment has such fears, it is surely reasonable for others to have them as well.
  Parliament has tried to get asylum rules and procedures right in the past, and has failed. Opposition Members proposed the establishment of a Special Standing Committee in 1992, and it was rejected. Perhaps, had the Government agreed to it, we would not now be discussing the need for new legislation. The House of Commons should be able to say that, if it is agreed that a problem exists, that problem should be susceptible of solution by the House.
  Let me cite just one problem in regard to which the Government's inactivity makes us worry about their approach to such problems. That problem could have been tackled, but has not been. This example may expose some of the double-speak of the Tory party in the Queen's Speech.
  In 1990, the Government promised to deal with a loophole in legislation that enabled organised criminals to perpetrate many kinds of fraud. I refer to what was called at the time the "Day of the Jackal" loophole, which exploited the ease of access to birth certificates in Britain.

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  In 1990, the Government produced a White Paper, "Registration—Proposals for Change", yet some of its recommendations have not yet been put into effect—most notably those intended to counter the loophole that allows the creation of false identities by organised criminal gangs, who can obtain birth certificates, and subsequently other documents, that can form the basis for fraud in a wide range of areas from social security to immigration.
  This year, in a letter to my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker), the Prime Minister said that he had been unable to find parliamentary time to close the loophole, yet there had been no approach to the Opposition to ask for our co-operation with such a measure. Why not? Surely if Ministers genuinely wanted to make progress, instead of simply making loud complaints about the problem, there would have been an approach.
  Hon. Members frequently complain about the public image and standing of Parliament. They often blame television and complain that Prime Minister's Question Time is the only representation of the House, yet when constructive suggestions are made, the Government turn their back on them, as they are doing now in connection with the Asylum and Immigration Bill. That refusal does the House no good whatever.
  I do not believe that the Leader of the House was allowed to influence that decision, which is a shame because he is a wiser man than the Home Secretary, and had he had his way the House could have been shown in a better light.
  I shall now talk about some of the areas for which the Leader of the House is specifically responsible. Incidentally, I thank him for announcing today the dates of the 10 constituency Fridays for this Session, and I also thank him in advance for his anticipated early announcement of recess dates.
  When I consider the parliamentary time that we have available, and when I hear comments such as those of the right hon. Member for Worthing (Sir T. Higgins), I am reminded how many failings our present system has. The Queen's Speech and the Budget—two of the biggest parliamentary occasions—are within days of each other. It is right that the debates on them are long and take a great deal of parliamentary time—but we may be short of time later.
  What the House needs is not the tinkering changes to procedure to which the Jopling report led, but a far more fundamental rethink of how our parliamentary system could be made to work more effectively through measures such as the publication of draft Bills, the use of pre-legislative Committees and the reorganisation of our timetable so as to make better use of the time available and to avoid the long three-month gap, which makes no sense in terms of the accountability of the House to the public.
  I believe that, unless we start thinking about those issues, and unless we make such changes, not necessarily to give more sitting days but to spread them more carefully throughout the year, Parliament will not be able to do its job effectively. I am sorry that this year the Leader of the House has not been able to lead a campaign for further changes in our procedures. I understand that change is always difficult, and that the House is always very traditional, but I hope that more change can come.
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  The House has been traditional today because, as has been our habit in recent years, we began the last day of the debate on the Queen's Speech with a debate on economic policy. At times today we might have been forgiven for thinking that we were in the middle of a Budget debate already—although clearly, judging by the questions that my hon. Friend the Member for Dunfermline, East (Mr. Brown) was asked, it would have been a Budget introduced by a Labour Chancellor. It was my hon. Friend who was asked to provide all the answers. [HON. MEMBERS: "He did not provide any."] He provided many of the answers—unlike the Chancellor, who does not seem to know the difference between objectives and policies.
  I always find it amusing that Conservative Members expect my hon. Friend to answer details about what will be in his first Budget in 18 months' time. Conservative Members tell us that the election might not be for 18 months, but I am not sure that the Chancellor will be able to tell us what he is going to do next week.
  Mr. Jacques Arnold: Will the hon. Lady give way?
  Mrs. Taylor: I am normally willing—
  Mr. Arnold rose—
  Mrs. Taylor: Will the hon. Gentleman let me finish? I am normally willing to give way but, unfortunately, Conservative Members wasted time at the beginning of my speech so I shall not give way.
  I have worked out why my hon. Friend the shadow Chancellor is always asked for so many details. Quite simply, there is so much interest in my hon. Friend's first Budget because there is so little confidence in this Queen's Speech. There is little confidence that the Queen's Speech has any relevance whatsoever to the needs of the country.
  The Chancellor, by contrast, has the luxury of sealed lips, and he cannot disclose the details of next week's Budget. I suppose that we will just have to wait until Sunday to read the briefings that the chairman of the Conservative party will give out. Nothing the Chancellor said today gives us confidence that he is anything other than incredibly complacent about the economic prospects for the country.
  Throughout the week of debate on the Queen's Speech, many themes have emerged. The main one is that the Queen's Speech does not attack the fundamental problems that face the country. My right hon. Friend the Leader of the Opposition asked last Wednesday where the plan for job creation was, and how the Government proposed to counter insecurity. Do Ministers realise that, in the five years to the end of 1994, almost 11 million British people—or two in five of the work force—experienced unemployment? That insecurity is real.
  Do Ministers realise that the amount of money that individuals have to spend has fallen, as a Financial Times article last week showed? That is not a state of mind, as the Secretary of State for Trade and Industry would imply. Do Ministers realise that 70 per cent. of all home repossessions are caused by job losses? That is not a state of mind, and those who suggest that it is insult the thousands of families who have been desperately hit by Conservative policies during the past few years.

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  One issue that was not mentioned in the Queen's Speech, but which I wish to touch on briefly—not least because I have a constituency interest—is the inadequacy of regulation of the private utilities. There was a debate in the House this morning on the problems facing my constituents and others in West Yorkshire. The House heard during that debate that Yorkshire Water supplied tankers of water free of charge to soften training grounds for racehorses while it was threatening rota cuts in the rest of West Yorkshire.
  Yorkshire Water told firms in Bradford that they should either relocate or boil 500, 000 gallons of water a day during the crisis. It has shown sheer incompetence. That is the impression not just of Labour Members of Parliament, but of local industry. The company's incompetence shows that regulation of the private utilities is woefully inadequate, but all the Minister could say today was that if the situation did not improve, he might have to consider setting leakage targets. There are 600 tankers trundling through Yorkshire, but one in three is wasting its time, because, as soon as the water gets into the system, it starts leaking out. All the Minister could say was that if the situation did not get any better he might have to consider what to do. The Minister wanted to wash his hands of that situation—[Laughter] That would be more than the chairman of Yorkshire Water did—he claimed that he did not do such healthy things.
  Many other problems are created by the Queen's Speech. I am sorry that the hon. Member for Leeds, North-West (Dr. Hampson) is not here. He talked about nursery education in Leeds and said that he welcomed the nursery voucher scheme because he thought that it would bring some nursery places. He said that the situation in relation to nursery places in Leeds was appalling. I have checked the figures since the hon. Gentleman spoke, which may be why he is not here.
  In Leeds, 45 per cent. of all three and four-year-olds and 30 per cent. of rising-fives are in nursery schools, so 75 per cent. of nursery age children in Leeds are in nursery education. The dreadful, appalling con trick of nursery vouchers is that they threaten that Labour-controlled council's excellent provision of nursery places, from which many children have benefited over many years. The Government's cynical contract will not be accepted by parents, because parents do not want nursery vouchers: they want quality nursery education for their children, which the Government are failing to provide.
  Throughout the Queen's Speech, Ministers and Conservative Members have clearly been practising for their time in opposition. They behave like an Opposition. They absolve themselves of all the problems that the country is facing. How often have we heard from Conservative Members during the past few days that something should be done about Government borrowing, interest rates, the quality of education and the level of crime? Those remarks were made by hon. Members who belong to a party that has been in office for 16 years.
  Sir Terence Higgins: Will the hon. Lady give way?
  Mrs. Taylor: I do not have time.
  The Chancellor had no evidence whatever to give today when he was under fire from my hon. Friend the shadow Chancellor. The sad fact is that Britain has fallen from
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  13th to 18th place in the GDP league table. I have looked—perhaps the hon. Member for Lancaster (Dame E. Kellett-Bowman) would like to look as well—at what the Conservative research department brief says about the league table that shows that Britain has fallen from 13th to 18th place. It says:
  "Labour's table is misleading and inaccurate … Labour's league table is another example of their cynicism: they don't care how spurious their figures are."
  The brief fails to mention that the source of the table is a document produced by the Government entitled "Competitiveness: Forging Ahead". The Chancellor chose to quote The Wall Street Journal as his only source of support. Perhaps he should come closer to home and look at last Thursday's Financial Times, which says:
  "The pound sank to a record low on the foreign exchanges yesterday as figures showing a rise in unemployment and the biggest fall in living standards for nearly 14 years".
  The Chancellor said nothing to deal with that. He showed only utter complacency.
  The Queen's Speech shows total complacency and gives no hope for Britain. It is a discredited Queen's Speech from a discredited Government who have failed Britain. The sooner they go, the better.
  9.34 pm
  The Lord President of the Council and Leader of the House of Commons (Mr. Tony Newton): I shall follow the pattern of the speech of the hon. Member for Dewsbury (Mrs. Taylor) by starting in a quieter tone. I recall that, on the first occasion that I had this task of winding up the debate on the Address in 1992, a senior former colleague, whose name I will not reveal, but some may guess, who was aware of the fact that the Leader of the House conventionally says something about House of Commons matters, advised me with words to the effect of, "Forget all that Leader of the House stuff and just sock it to 'em." Being of a naturally conservative nature, however, I stuck to the convention on that occasion, as I propose to do for part of my speech tonight.
  Indeed, at a time when the House is so often much criticised for the way in which its business is conducted, it is worth spending a few minutes on the significant improvements of the past year.
  Mr. John Marshall: I thank my right hon. Friend for giving way to allow me to mention a House of Commons matter. He may be aware that, last week, I wrote to Sir Gordon Downey after the publication of an amendment to the Loyal Address in which a number of the signatories, who had been sponsored by a trade union, did not declare that sponsorship. His advice on declaring the interest on the Order Paper was that
  "this is the appropriate course of action to take."
  Would my right hon. Friend care to comment on the fact that a right hon. Gentleman—a member of the Transport and General Workers Union—sought not to do so when he put his name to an amendment today?
  Mr. Newton: I note what my hon. Friend says. I also heard the exchanges between the hon. Member for Dewsbury and another of my hon. Friends about a quarter of an hour ago. While I note what my hon. Friend says, the proper thing for me to do is to say that, if there is thought to be a source of complaint, it would be proper

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  for it to be directed to the Parliamentary Commissioner for Standards, whom we have put in place precisely to consider such complaints.
  Mr. Archy Kirkwood: As we are on House of Commons matters, may I report to the Leader of the House that there is genuine confusion about the interpretation of the new rule? Does he not think, therefore, that it would be a good thing to expedite the setting up of the new Select Committee, to give the new commissioner clearer guidelines and instructions?
  Mr. Newton: As the hon. Gentleman will know, I circulated a note setting out the position as clearly as was possible in the light of the report, the debate and the resolutions that the House had passed. I consistently acknowledged in the debate, as the report acknowledged, that there would be a need for further guidance and guidelines and that that would be the task of the Select Committee, working with the commissioner. I can assure the hon. Gentleman that the usual channels are beavering away with a view to getting the new Select Committee established and I hope that it will be possible to proceed before too much longer, partly for the very reason that he reasonably mentioned.
  Before I return to one or two House of Commons matters that I wanted to mention, I must say that I was particularly sorry not to have been in the Chamber to hear the right hon. Member for Lagan Valley (Mr. Molyneaux), but with the miracles of modern technology, I was able to follow some of what he said from afar. I want to assure him that the Government warmly welcome the programme for peace and reconciliation in Northern Ireland and the border counties of Ireland. It is a tangible contribution to the peace process, and the right hon. Gentleman might like to know that all expenditure incurred under that programme will be subject to the same standards of accountability and the need to secure value for money as apply generally to public expenditure in the United Kingdom. I hope that that will be helpful to the right hon. Gentleman.
  To return to the House of Commons part of my speech, looking back on the speech that I made on this occasion a year ago, I noticed some reasonably optimistically worded paragraphs in which I hoped—and I was proved right—that the hon. Member for Dewsbury would be similarly supportive. I had an optimistically worded passage about my hopes that we would find an agreed way forward on changes along the lines recommended by what has become known as Jopling.
  The hon. Member for Dewsbury may see some irony in this, but against the background of our efforts at that time to suggest and subsequently to bring to the attention of our colleagues—that is perhaps the most tactful phrase that I can use—the desirability of 20-minute winding-up speeches in debates such as this, it is curious that we should find ourselves with more time than that on this occasion, for reasons that I do not wish to go into, but which we both understand.
  Since that debate a year ago, we have not only achieved that agreement but conducted an experiment that I think is widely seen on both sides of the House as having been a very considerable success. It has brought about a reduction of the House's average sitting hours of something like an hour a day. It has made sittings beyond
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  11 pm a rarity and sittings beyond midnight a wholly exceptional event. Combined with longer notice of business, earlier notification of recesses and the introduction of non-sitting Fridays, it has genuinely helped hon. Members to plan in a more sensible way for their constituency and family commitments.
  The arrangements for Wednesday mornings have increased the time and opportunities available for Back Benchers to raise subjects of their choice. The Government have been able to get their necessary business through, but without the Opposition feeling that they have been deprived of the proper opportunity, which I, of course, respect, to probe, discuss and, where they wish, oppose.
  I do not think that this has been remarked on before, but I asked for some checking to be done today. One result of the changes has been that we have just experienced the first Session for 35 years in which no guillotine motion has been moved, with the solitary exception, I should perhaps say—I do not know whether this will wipe the smile off the face of the hon. Member for Glasgow, Garscadden (Mr. Dewar), but it probably will not—of 1978–79, when the absence of guillotines was the result of the Government being guillotined and a general election taking place.
  The changes that have enabled all that to happen have been turned into permanent changes in our Standing Orders, which should enable us, with what I hope will be continued good will in the usual channels—I was encouraged by what the hon. Member for Dewsbury said—to consolidate those sensible developments. Certainly that will be my aim. I take this opportunity to thank warmly the hon. Member for Dewsbury for her kind words about me. Whether they will still apply by the time I have got to the end of my speech I am less sure. Whether they would have been approved by the hon. Member for Thurrock (Mr. Mackinlay) I rather doubt, because last week at business questions he effectively suggested that I should resign for being too reasonable.
  Meanwhile, other gains have been made by procedural changes. The introduction of new arrangements both here and in another place have markedly increased our ability to deal with non-controversial Bills arising from Law Commission reports, with the twin advantages of improving the statute book and reducing the frustration of the Law Commission at seeing so much of its excellent work apparently disappear into limbo. In the past two Sessions, 13 Law Commission reports have been implemented, which is a substantial increase on earlier periods. I should make it clear, as does the Gracious Speech, that my noble Friend the Lord Chancellor will bring forward further such measures in the Session now getting under way.
  Another significant improvement is the changes brought forward by my right hon. Friend the President of the Board of Trade, then the Secretary of State for Scotland, which have enhanced the role of the Scottish Grand Committee. In the past year, the Committee has met in Glasgow and Aberdeen as well as in Edinburgh and Westminster. There have been extra sessions of Scottish questions in the Committee, as well as statements by Ministers and debates initiated both by Government and by the various Opposition parties. As the House knows, the Government are considering how those new

  757
  procedures can be developed further, and my right hon. Friend the Secretary of State for Scotland will be making an announcement in due course.
  Then, too, and certainly no less important, there is the matter to which my hon. Friend the Member for Hendon, South (Mr. Marshall) and the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) referred. I refer to the changes that the House agreed just before the end of the previous Session, following the work of the Nolan report and the Select Committee on Standards in Public Life. Although inevitably obscured, perhaps rather unfortunately, by the controversy on one point, people are less well aware than those of us who were concerned with the work of that Committee would like them to be of the fact that it was largely on the basis of consensus, in an all-party Committee, and with the support of large and sometimes overwhelming majorities in the House, that we put in place the most significant strengthening of our rules in many decades.
  I hope that I make the following claim rightly on behalf of the House as a whole. In short, over the past year, the House has done a great deal to adapt to new needs, new circumstances, new conditions and new moods, showing exactly the strength that has made it probably the most enduring institution of its kind in the world. Although I note, as I have had to note on one or two radio programmes, the pressure for faster or more radical change, I believe that the evolutionary development of this place is a fundamental part of its strength and the reason why it has lasted so well and so long.
  Mr. Benn: In the light of the experience of the Privileges Committee, to which the Leader of the House refers, has he given any further thought to the advantages to Parliament's reputation of such Committees being open so that the debates can be heard, a point that I made a year ago and for which I paid a heavy price? I believe that the time has come when the openness of such Select Committees should be seriously considered.
  Mr. Newton: Obviously enough, I and, no doubt, many others have given further thought to that point. I draw a distinction between the question whether evidence should be taken in public under certain circumstances and the question whether deliberation should take place in public. I think that, far from being enhanced, the role of the Committees would be destroyed were meetings to be wholly held in public.
  Certainly the hon. Member for Dewsbury will agree that we teased out, eventually successfully, the vast majority of the subject matter, such as the appointment of the parliamentary commissioner, the code, the new Select Committee on Standards and Privileges, the ban on advocacy and a whole range of what was agreed by the House a fortnight ago. Had we sought to achieve that unanimity on the basis of having everything openly reported and available—every exchange and every modification—it would not have worked. We would have ended up with a totally different and far less satisfactory way in which to proceed.
  I make this point even without being able to prove it by revealing the proceedings beyond what I have said just now. Anybody who had been able to listen to the exchanges, assuming that they could have been entirely
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  confidential and that the presence of a listener would not have inhibited them, which of course it would have done, would have thought that it was an example of all the parties in Parliament at their best, working in the interests of Parliament as a whole. The results demonstrate that.
  Mr. Tony Marlow: My right hon. Friend talks about unanimity in the Committee. Sometimes when that happens, the House should be put on its guard. In the event, we had a three-hour debate and most of the people who spoke in that debate were either members of the Committee or related to the subject. Back Benchers or others who might have had a different point of view had no time to bring their points of view forward. When next a Select Committee has debates and produces recommendations, will my right hon. Friend give the House an undertaking that there will be proper time for people who have not been members of that Committee to put their points of view in a debate?
  Mr. Newton: I always give consideration to such representations. I do not think that I can make an advance commitment without knowing what my hon. Friend might be talking about. Is he, for example, talking about a report that might come from the new Select Committee on Standards and Privileges? I assure him that I shall bear in mind what he has said, because I know that he reflects the views of other hon. Members as well.
  I now touch on one other point which is more clearly for the Government as such, but which is very much directed towards improving the working of Parliament in relation to legislation. I know that the hon. Member for Birmingham, Perry Barr (Mr. Rooker) is interested in this point. I refer to the publication of Bills in draft so that those who may be affected by them have a good opportunity to comment not only on the policy, but on the detail and practical effect of proposed legislation. That proved helpful in the Session before last, in the case, albeit a rather special one, of the Sunday Trading Bill, and with the Environment Agency provisions of the Environment Act 1995. In the previous Session—the hon. Member for Dewsbury kindly referred to this—we published draft Bills on the reserve forces, on defamation and on arbitration, all of which we hope to bring before the House this Session.
  More recently we published drafts of the Hong Kong (Overseas Public Servants) Bill and the Chemical Weapons Bill, which the House will consider tomorrow. Inevitably, it will not be possible for every Bill to be published in draft, but I have no doubt that, where timing and other considerations make it practicable and appropriate, that practice can greatly contribute to the quality of the legislation that the House passes.
  As the Government said in the second competitiveness White Paper, which has been waved about in a different context several times today:
  "Publication of draft Bills, in advance of introduction in Parliament, allows consultation to take place on clarity of structure and presentation, and on drafting detail, as well as on policy."
  The White Paper made it clear that we hope to move further in that direction and to increase the number of Bills published in draft in advance. I can tell the House, and I think that it has not been said before, that, in the current Session, and in the spirit of the White Paper, we intend to publish draft Bills on adoption, building societies and merchant shipping.
  Mr. Peter Shore: The right hon. Gentleman has made a strong case for publishing draft Bills, to enable people to consider them and to contribute before they become final. Given the obvious controversy surrounding the Asylum and Immigration Bill, does he not think that it would be a suitable candidate for publishing in draft before the final Bill is presented?
  Mr. Newton: Perhaps rather delphically, I used a phrase about "where timing and other considerations make it practicable and appropriate". The figures that my right hon. and learned Friend the Home Secretary gave in his statement the other day, and no doubt used in his speech on Monday, make it clear that the rapid and almost dramatic escalation in the problem suggests that it is one that must be tackled more urgently than would be allowed for by the suggestion made by the right hon. Member for Bethnal Green and Stepney (Mr. Shore).
  Sir David Mitchell: Does my right hon. Friend see scope for applying the principle to Euro-regulations and directives?
  Mr. Newton: As for legislation initiated in Europe, that question would not fall to me as Leader of the House in this Parliament. I have been concerned notably with social security legislation, and moves have already been made to publish secondary legislation in draft, for example, for consultation with the Social Security Advisory Committee. Where practicable, and where it would genuinely help to improve the legislative process, I would like consideration to be given to such publication in draft, in appropriate cases.
  Dame Elaine Kellett-Bowman: Does my right hon. Friend agree that it is one thing to refer Law Commission reports to a Special Standing Committee, as he mentioned earlier, but quite another to do as the hon. Member for Dewsbury (Mrs. Taylor) said, and refer such a controversial Bill as the Asylum and Immigration Bill to such a Committee?
  Mr. Newton: The hon. Member for Dewsbury referred to that suggestion, which has been the subject of much argument in the House in the past few days and correspondence between my right hon. Friend the Prime Minister and the Leader of the Opposition. I basically agree with my hon. Friend the Member for Lancaster (Dame E. Kellett-Bowman), but I do not want to add to the argument tonight, despite the blandishments of the hon. Member for Dewsbury.
  The hon. Member for Dewsbury unhelpfully anticipated another point that I wanted to raise, which takes me back to the spirit of Jopling—in this case, the earlier notification of recess dates. The House may like to know that, subject to the progress of business, the House will rise at the conclusion of business on Wednesday 20 December until Tuesday 9 January. At Easter, again subject to the progress of business, the House will rise at the conclusion of business on Wednesday 3 April until Tuesday 16 April. That of course means that the recess this year will cover the week after Easter rather than the week before, as it did last Session. I hope that that is helpful to the House and that I may claim my brownie points. However, whatever else is obvious today, it is obvious that there is a good deal of debate to come on many issues before we get as far as the Christmas recess, let alone Easter, and it is to some of those arguments that I shall now refer.
  760
  I start by referring to the speech of the hon. Member for Dunfermline, East (Mr. Brown)—or rather, the annual re-run of the same speech, to which I always listen with interest, if only in hope, which has so far always proved vain, of hearing something new. That familiar but not especially friendly speech has two characteristics. First, it relentlessly runs the country down and ignores every achievement. The second characteristic is that, having said that everything is wrong, the hon. Gentleman says nothing whatever about what he would do about it. In both respects, he played true to form today.
  We heard much about unemployment, which we all want to reduce and which we have reduced by 700, 000, but not a word about the extent to which the country has effectively the best record in Europe in reducing unemployment and in putting the biggest proportion of its population into work.
  We heard many references to people who are less well-off and vulnerable, but not a word about the tens of thousands of people being helped by disability living allowance, introduced by the present Government, the more than £1 billion extra in real terms put into helping low-income families since 1988 and another £1 billion put into helping the less well-off pensioners.
  We heard much about the need for investment—which the Chancellor countered with some striking figures showing how much better our record was than many others—but not a word about the country's record in attracting inward investment, obtaining one third of all investment into the European Union from outside, which embraced 41 per cent. of that from Japan, 43 per cent. of that from the United States and 50 per cent. of that from Korea.
  To cap it all, we heard—from a Labour Front-Bench spokesman—about the lurch to the right. The most that can be said about that is that at least it is something of which Labour Front-Bench Members have some first-hand experience—but for how long? I do not know, because we can see the faces on the Labour Benches below the Gangway when hon. Members speak from the Labour Front Bench. We can also see the faces on the Labour Back Benches when hon. Members speak from the Labour Front Bench.
  I make no apology for repeating what my right hon. and learned Friend the Chancellor of the Exchequer said this afternoon, when he quoted the striking words of the hon. Member for Hackney, North and Stoke Newington (Ms Abbott):
  "Gordon can say anything he likes if he thinks it is going to win the Election. But ordinary Labour party supporters in this country, particularly the poor and the unemployed when Labour is in power will be looking for other priorities from tax cuts."
  [Interruption.] What, "Hear, hear" from below the Gangway? Does the hon. Member for Worsley (Mr. Lewis) want to intervene?
  Mr. Terry Lewis indicated dissent.
  Mr. Newton: That is only because the hon. Gentleman does not want to confirm what I am saying.
  On the Opposition Benches, there is not a lurch to the left but a leap to the left, and an awful lot of people are left behind.

  761
  After his litany of gloom, what did we get from the hon. Member for Dunfermline, East? Frankly, we got even less than usual. However, the hon. Member for Dewsbury said that he was being asked for all the answers. I should not mind if we received any answers, let alone all of them.
  In his speech last week, the Leader of the Opposition started off by describing the Queen's Speech, on which we are now debating the humble Address, as irrelevant to the needs of Britain and a pathetic mouse. Three paragraphs further on, he had—as the hon. Member for Dewsbury has tonight—expressed support for about half the programme or had said that he thought that Labour had thought of it. He continued to wriggle, to try to dissociate himself from his hon. Friends' opposition to the asylum Bill. It came down to the fact that he did not like the speech because it enhanced opportunity, choice and standards in education.
  The Queen's Speech is not an irrelevant mouse; it is a vigorous programme in the interests of our country. I invite the House to support it tonight.
  Question put, That the amendment be made:—
  The House divided: Ayes 271, Noes 298.

  Division No. 2]

  [10.00 pm

  AYES

  Abbott, Ms Diane

  Chidgey, David

  Adams, Mrs Irene

  Chisholm, Malcolm

  Ainger, Nick

  Church, Judith

  Ainsworth, Robert (Cov'try NE)

  Clapham, Michael

  Allen, Graham

  Clark, Dr David (South Shields)

  Alton, David

  Clarke, Eric (Midlothian)

  Anderson, Donald (Swansea E)

  Clarke, Tom (Monklands W)

  Anderson, Ms Janet (Ros'dale)

  Clelland, David

  Armstrong, Hilary

  Clwyd, Mrs Ann

  Ashdown, Rt Hon Paddy

  Cohen, Harry

  Ashton, Joe

  Connarty, Michael

  Austin-Walker, John

  Cook, Robin (Livingston)

  Barnes, Harry

  Corbett, Robin

  Barron, Kevin

  Corbyn, Jeremy

  Battle, John

  Corston, Jean

  Bayley, Hugh

  Cousins, Jim

  Beckett, Rt Hon Margaret

  Cummings, John

  Beith, Rt Hon A J

  Cunningham, Jim (Covy SE)

  Bell, Stuart

  Cunningham, Rt Hon Dr John

  Benn, Rt Hon Tony

  Cunningham, Roseanna

  Bennett, Andrew F

  Dalyell, Tam

  Benton, Joe

  Darling, Alistair

  Bermingham, Gerald

  Davies, Bryan (Oldham C'tral)

  Berry, Roger

  Davies, Chris (L'Boro & S'worth)

  Betts, Clive

  Davies, Rt Hon Denzil (Llanelli)

  Blunkett, David

  Davies, Ron (Caerphilly)

  Boateng, Paul

  Davis, Terry (B'ham, H'dge H'l)

  Bradley, Keith

  Denham, John

  Bray, Dr Jeremy

  Dewar, Donald

  Brown, Gordon (Dunfermline E)

  Dixon, Don

  Brown, N (N'c'tle upon Tyne E)

  Dobson, Frank

  Bruce, Malcolm (Gordon)

  Donohoe, Brian H

  Burden, Richard

  Dowd, Jim

  Byers, Stephen

  Dunwoody, Mrs Gwyneth

  Caborn, Richard

  Eagle, Ms Angela

  Callaghan, Jim

  Eastham, Ken

  Campbell, Mrs Anne (C'bridge)

  Etherington, Bill

  Campbell, Menzies (Fife NE)

  Evans, John (St Helens N)

  Campbell, Ronnie (Blyth V)

  Ewing, Mrs Margaret

  Campbell-Savours, D N

  Fatchett, Derek

  Canavan, Dennis

  Field, Frank (Birkenhead)

  Cann, Jamie

  Fisher, Mark

  Candle, Alexander (Montgomery)

  Flynn, Paul

  762

  Foster, Rt Hon Derek

  McCrea, The Reverend William

  Foster, Don (Bath)

  Macdonald, Calum

  Foulkes, George

  McFall, John

  Fyfe, Maria

  McKelvey, William

  Galbraith, Sam

  Mackinlay, Andrew

  Galloway, George

  McLeish, Henry

  Gapes, Mike

  McMaster, Gordon

  Garrett, John

  McNamara, Kevin

  Gerrard, Neil

  MacShane, Denis

  Gilbert, Rt Hon Dr John

  Madden, Max

  Godman, Dr Norman A

  Maddock, Diana

  Godsiff, Roger

  Mahon, Alice

  Golding, Mrs Llin

  Mandelson, Peter

  Gordon, Mildred

  Marek, Dr John

  Graham, Thomas

  Marshall, Jim (Leicester, S)

  Grant, Bernie. (Tottenham)

  Martin, Michael J (Springburn)

  Griffiths, Nigel (Edinburgh S)

  Martlew, Eric

  Griffiths, Win (Bridgend)

  Maxton, John

  Grocott, Bruce

  Meacher, Michael

  Gunnell, John

  Meal, Alan

  Hain, Peter

  Miche, Alun

  Hall, Mike

  Michie, Bill (Sheffield Heeley)

  Hanson, David

  Michie, Mrs Ray (Argyll & Bute)

  Hardy, Peter

  Milburn, Alan

  Harman, Ms Harriet

  Miller, Andrew

  Harvey, Nick

  Morgan, Rhodri

  Hattersley, Rt Hon Roy

  Morgan, Elliot

  Henderson, Doug

  Morris, Rt Hon Alfred (Wy'nshawe)

  Heppell, John

  Morris, Estelle (B'ham Yardley)

  Hill, Keith (Streatham)

  Morris, Rt Hon John (Aberavon)

  Hinchliffe, David

  Mowlam, Marjorie

  Hoey, Kate

  Mudie, George

  Hogg, Norman (Cumbernauld)

  Mullin, Chris

  Hood, Jimmy

  Murphy, Paul

  Hoon, Geoffrey

  O'Brien, Mike (N W'kshire)

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

  O'Brien, William (Normanton)

  Howarth, George (Knowsley North)

  O'Hara, Edward

  Howells, Dr Kim (Pontypridd)

  Olner, Bill

  Hoyle, Doug

  O'Neill, Martin

  Hughes, Kevin (Doncaster N)

  Orme, RT Hon Stanley

  Hughes, Robert (Aberdeen N)

  Parry, Robert

  Hughes, Roy (Newport E)

  Perarson, Ian

  Hughes, Simon (Southwark)

  Pendry, Tom

  Hutton, John

  Pickthall, Colin

  Illsley, Eric

  Pike, peter L

  Ingram, Adam

  Pope, Greg

  Jackson, Glenda (H'stead)

  Powell, Ray (Ogmore)

  Jackson, Helen (Shef'ld, H)

  Prentice, Bridget (Lew'm E)

  Jamieson, David

  Prentice, Gordon (Pendle)

  Janner, Greville

  Prescott, Rt Hon John

  Johnston, Sir Russell

  Primarolo, Dawn

  Jones, Barry (Alyn and D'side)

  Purchase, ken

  Jones, Ieuan Wyn (Ynys MÔn)

  Quin, Ms Joyce

  Jones, Jon Owen (Cardiff C)

  Radice, Giles

  Jones, Lynne (B'ham S O)

  Rendall, Stuart

  Jones, Martyn (Clwyd, SW)

  Reynsford, Nick

  Jones, Nigel (Cheltenham)

  Reid, Dr John

  Jowell, Tessa

  Rendel, David

  Kaufman, Rt Hon Gerald

  Robertson, George (Hamilton)

  Keen, Alan

  Robinson, Geoffrey (Co'try NW)

  Kennedy, Charles (Ross, C&S)

  Roche, Mrs Barbara

  Kennedy, Jane (L'pool Br'dg'n)

  Rogers, Allan

  Khabra, Piara S

  Rooker, Jeff

  Kilfoyle, Peter

  Rooney, Terry

  Kirkwood, Archy

  Ross, Ernie (Dundee W)

  Lestor, Joan (Eccles)

  Rowlands, Ted

  Lewis, Terry

  Ruddock, Alex

  Liddell, Mrs Helen

  Salmond, Alex

  Livingstone, Ken

  Sedgemore, Brian

  Lloyd, Tony (Stretford)

  Sheerman, Barry

  Llwyd, Elfyn

  Sheldon, Rt Hon Robert

  Loyden, Eddie

  Shore, Rt Hon Peter

  Lynne, Ms Liz

  Short, Clare

  McAllion, John

  Simpson, Alan

  McCartney, Ian

  Skinner, Dennis

  McCartney, Robert

  Smith, Chris (Isl'ton S & F'sbury)

  763

  Smith, Llew (Blaenau Gwent)

  Walker, Rt Hon Sir Harold

  Spearing, Nigel

  Walley, Joan

  Spellar, John

  Wardell, Gareth (Gower)

  Squire, Rachel (Dunfermline W)

  Wareing, Robert N

  Steinberg, Gerry

  Welsh, Andrew

  Stevenson, George

  Wicks, Malcolm

  Stott, Roger

  Williams, Rt Hon Alan (Sw'n W)

  Strang, Dr. Gavin

  Williams, Alan W (Carmarthen)

  Straw, Jack

  Wilson, Brian

  Sutcliffe, Gerry

  Winnick, David

  Wise, Audrey

  Taylor, Mrs Ann (Dewsbury)

  Worthington, Tony

  Taylor, Matthew (Truro)

  Wray, Jimmy

  Thompson, Jack (Wansbeck)

  Wright, Dr Tony

  Timms, Stephen

  Young, David (Bolton SE)

  Tipping, Paddy

  Touhig, Don

  Tellers for the Ayes:

  Tyler, Paul

  Ms Ann Coffey and

  Vaz, Keith

  Mr. Dennis Turner.

  NOES

  Ainsworth, Peter (East Surrey)

  Congdon, David

  Aitken, Rt Hon Jonathan

  Coombs, Anthony (Wyre For'st)

  Alexander, Richard

  Coombs, Simon (Swindon)

  Alison, Rt Hon Michael (Selby)

  Cope, Rt Hon Sir John

  Allason, Rupert (Torbay)

  Cormack, Sir Patrick

  Amess, David

  Couchman, James

  Arbuthnot, James

  Cran, James

  Arnold, Jacques (Gravesham)

  Currie, Mrs Edwina (S D'by'ire)

  Arnold, Sir Thomas (Hazel Grv)

  Curry, David (Skipton & Ripon)

  Ashby, David

  Davies, Quentin (Stamford)

  Atkins, Rt Hon Robert

  Davis, David (Boothferry)

  Atkinson, David (Bour'mouth E)

  Day, Stephen

  Atkinson, Peter (Hexham)

  Deva, Nirj Joseph

  Baker, Rt Hon Kenneth (Mole V)

  Devlin, Tim

  Baker, Nicholas (North Dorset)

  Dorrell, Rt Hon Stephen

  Baldry, Tony

  Douglas-Hamilton, Lord James

  Banks, Matthew (Southport)

  Dover, Den

  Banks, Robert (Harrogate)

  Duncan, Alan

  Batiste, Spencer

  Duncan-Smith, Iain

  Bellingham, Henry

  Dunn, Bob

  Bendall, Vivian

  Durant, Sir Anthony

  Beresford, Sir Paul

  Dykes, Hugh

  Biffen, Rt Hon John

  Eggar, Rt Hon Tim

  Bonsor, Sir Nicholas

  Elletson, Harold

  Booth, Hartley

  Emery, Rt Hon Sir Peter

  Boswell, Tim

  Evans, David (Welwyn Hatfield)

  Bottomley, Peter (Eltham)

  Evans, Jonathan (Brecon)

  Bottomley, Rt Hon Virginia

  Evans, Nigel (Ribble Valley)

  Bowis, John

  Evans, Roger (Monmouth)

  Boyson, Rt Hon Sir Rhodes

  Evennett, David

  Brandreth, Gyles

  Faber, David

  Brazier, Julian

  Fabricant, Michael

  Bright, Sir Graham

  Fenner, Dame Peggy

  Brooke, Rt Hon Peter

  Field, Barry (Isle of Wight)

  Brown, M (Brigg & Cl'thorpes)

  Fishburn, Dudley

  Browning, Mrs Angela

  Forman, Nigel

  Bruce, Ian (Dorset)

  Forsyth, Rt Hon Michael (Stirling)

  Budgen, Nicholas

  Forth, Eric

  Burns, Simon

  Fowler, Rt Hon Sir Norman

  Burt, Alistair

  Fox, Dr Liam (Woodspring)

  Butcher, John

  Fox, Sir Marcus (Shipley)

  Butler, Peter

  Freeman, Rt Hon Roger

  Butterfill, John

  French, Douglas

  Carlisle, John (Luton North)

  Fry, Sir Peter

  Carlisle, Sir Kenneth (Lincoln)

  Gale, Roger

  Carrington, Matthew

  Gallie, Phil

  Carttiss, Michael

  Garel-Jones, Rt Hon Tristan

  Cash, William

  Garnier, Edward

  Channon, Rt Hon Paul

  Gill, Christopher

  Chapman, Sir Sydney

  Gillan, Cheryl

  Churchill, Mr

  Goodlad, Rt Hon Alastair

  Clark, Dr Michael (Rochford)

  Goodson-Wickes, Dr Charles

  Clarke, Rt Hon Kenneth (Ru'clif)

  Gorman, Mrs Teresa

  Clifton-Brown, Geoffrey

  Gorst, Sir John

  Coe, Sebastian

  Grant, Sir A (SW Cambs)

  764

  Greenway, Harry (Ealing N)

  Mawhinney, Rt Hon Dr Brian

  Greenway, John (Ryedale)

  Mellor, Rt Hon David

  Griffiths, Peter (Portsmouth, N)

  Merchant, Piers

  Grylls, Sir Michael

  Mills, Iain

  Gummer, Rt Hon John Selwyn

  Mitchell, Andrew (Gedling)

  Hague, Rt Hon William

  Mitchell, Sir David (NW Hants)

  Hamilton, Sir Archibald

  Moate, Sir Roger

  Hamilton, Neil (Tatton)

  Molyneaux, Rt Hon James

  Hampson, Dr Keith

  Monro, Rt Hon Sir Hector

  Hanley, Rt Hon Jeremy

  Montgomery, Sir Fergus

  Hannam, Sir John

  Needham, Rt Hon Richard

  Hargreaves, Andrew

  Neubert, Sir Michael

  Harris, David

  Newton, Rt Hon Tony

  Haselhurst, Sir Alan

  Nicholls, Patrick

  Hawkins, Nick

  Nicholson, David (Taunton)

  Hawksley, Warren

  Nicholson, Emma (Devon West)

  Hayes, Jerry

  Norris, Steve

  Heald, Oliver

  Onslow, Rt Hon Sir Cranley

  Heath, Rt Hon Sir Edward

  Oppenheim, Phillip

  Heathcoat-Amory, David

  Ottaway, Richard

  Hendry, Charles

  Page, Richard

  Hicks, Robert

  Paice, James

  Higgins, Rt Hon Sir Terence

  Patnick, Sir Irvine

  Hill, James (Southampton Test)

  Patten, Rt Hon John

  Hogg, Rt Hon Douglas (G'tham)

  Pattie, Rt Hon Sir Geoffrey

  Horam, John

  Pawsey, James

  Hordern, Rt Hon Sir Peter

  Peacock, Mrs Elizabeth

  Howell, Rt Hon David (G'dford)

  Pickles, Eric

  Howell, Sir Ralph (N Norfolk)

  Porter, Barry (Wirral S)

  Hughes, Robert G (Harrow W)

  Porter, David (Waveney)

  Hunt, Rt Hon David (Wirral W)

  Portillo, Rt Hon Michael

  Hunt, Sir John (Ravensbourne)

  Powell, William (Corby)

  Hunter, Andrew

  Rathbone, Tim

  Hurd, Rt Hon Douglas

  Redwood, Rt Hon John

  Jack, Michael

  Renton, Rt Hon Tim

  Jackson, Robert (Wantage)

  Riddick, Graham

  Jenkin, Bernard

  Robathan, Andrew

  Jessel, Toby

  Roberts, Rt Hon Sir Wyn

  Johnson Smith, Sir Geoffrey

  Robertson, Raymond (Ab'd'n S)

  Jones, Gwilym (Cardiff N)

  Robinson, Mark (Somerton)

  Jones, Robert B (W Hertfdshr)

  Roe, Mrs Marion (Broxbourne)

  Jopling, Rt Hon Michael

  Rowe, Andrew (Mid Kent)

  Kellett-Bowman, Dame Elaine

  Rumbold, Rt Hon Dame Angela

  King, Rt Hon Tom

  Sackville, Tom

  Kirkhope, Timothy

  Sainsbury, Rt Hon Sir Timothy

  Knapman, Roger

  Scott, Rt Hon Sir Nicholas

  Knight, Mrs Angela (Erewash)

  Shaw, Sir Giles (Pudsey)

  Knight, Rt Hon Greg (Derby N)

  Shephard, Rt Hon Gillian

  Knight, Dame Jill (Bir'm E'st'n)

  Shepherd, Colin (Hereford)

  Knox, Sir David

  Shepherd, Richard (Aldridge)

  Kynoch, George (Kincardine)

  Shersby, Sir Michael

  Lait, Mrs Jacqui

  Sims, Roger

  Lang, Rt Hon Ian

  Skeet, Sir Trevor

  Lawrence, Sir Ivan

  Smith, Sir Dudley (Warwick)

  Legg, Barry

  Smith, Tim (Beaconsfield)

  Lennox-Boyd, Sir Mark

  Smyth, The Reverend Martin

  Lester, Jim (Broxtowe)

  Soames, Nicholas

  Lidington, David

  Speed, Sir Keith

  Lightbown, Sir David

  Spencer, Sir Derek

  Lloyd, Rt Hon Sir Peter (Fareham)

  Spicer, Sir James (W Dorset)

  Lord, Michael

  Spicer, Michael (S Worcs)

  Luff, Peter

  Spink, Dr Robert

  MacKay, Andrew

  Spring, Richard

  Maclean, Rt Hon David

  Sproat, Iain

  McLoughlin, Patrick

  Squire, Robin (Hornchurch)

  McNair-Wilson, Sir Patrick

  Stanley, Rt Hon Sir John

  Madel, Sir David

  Steen, Anthony

  Maitland, Lady Olga

  Stephen, Michael

  Malone, Gerald

  Stem, Michael

  Mans, Keith

  Stewart, Allan

  Marland, Paul

  Streeter, Gary

  Marlow, Tony

  Sumberg, David

  Marshall, John (Hendon S)

  Sweeney, Walter

  Marshall, Sir Michael (Arundel)

  Sykes, John

  Martin, David (Portsmouth S)

  Tapsell, Sir Peter

  Mates, Michael

  Taylor, Ian (Esher)

  765

  Taylor, John M (Solihull)

  Waterson, Nigel

  Temple-Morris, Peter

  Watts, John

  Thomason, Roy

  Wells, Bowen

  Thompson, Patrick (Norwich N)

  Wheeler, Rt Hon Sir John

  Thornton, Sir Malcolm

  Whitney, Ray

  Thurnham, Peter

  Whittingdale, John

  Townend, John (Bridlington)

  Widdecombe, Ann

  Townsend, Cyril D (Bexl'yh'th)

  Wiggin, Sir Jerry

  Tracey, Richard

  Wilkinson, John

  Tredinnick, David

  Willetts, David

  Trend, Michael

  Wilshire, David

  Twinn, Dr Ian

  Winterton, Mrs Ann (Congleton)

  Vaughan, Sir Gerard

  Winterton, Nicholas (Macc'f'ld)

  Viggers, Peter

  Wolfson, Mark

  Waldegrave, Rt Hon William

  Wood, Timothy

  Walden, George

  Yeo, Tim

  Walker, Bill (N Tayside)

  Waller, Gary

  Tellers for the Noes:

  Ward, John

  Mr. Derek Conway and

  Wardle, Charles (Bexhill)

  Mr. Michael Bates.

  Question accordingly negatived.
  Amendment proposed, at the end of the Question, to add,
  But humbly regret that the Gracious Speech fails to set out adequate proposals to secure investment in people through education, to reform Britain's discredited system of government or to build for the country's long-term future through investment in housing and transport; and further regret that measures outlined in the Gracious Speech on housing and immigration risk adding to the divisions in society.—[Mr. Ashdown.]
  Question put forthwith, pursuant to Standing Order No. 32 (Calling of amendments at end of debate), That the amendment be made:—
  The House divided: Ayes 32, Noes 297.

  Division No. 3]

  [10.16 pm

  AYES

  Alton, David

  Maddock, Diana

  Ashdown, Rt Hon Paddy

  Mahon, Alice

  Barnes, Harry

  Marek, Dr John

  Beith, Rt Hon A J

  Michie, Bill (Sheffield Heeley)

  Bruce, Malcolm (Gordon)

  Michie, Mrs Ray (Argyll & Bute)

  Campbell, Menzies (Fife NE)

  Rendel, David

  Carlile, Alexander (Montgomery)

  Salmond, Alex

  Chidgey, David

  Skinner, Dennis

  Corbyn, Jeremy

  Steel, Rt Hon Sir David

  Cunningham, Roseanna

  Taylor, Matthew (Truro)

  Davies, Chris (L'Boro & S'worth)

  Tyler, Paul

  Ewing, Mrs Margaret

  Wallace, James

  Foster, Don (Bath)

  Welsh, Andrew

  Harvey, Nick

  Wise, Audrey

  Johnston, Sir Russell

  Jones, Nigel (Cheltenham)

  Tellers for the Ayes:

  Kennedy, Charles (Ross,C&S)

  Mr. Archy Kirkwood and

  Lynne, Ms Liz

  Mr. Simon Hughes.

  NOES

  Ainsworth, Peter (East Surrey)

  Baldry, Tony

  Aitken, Rt Hon Jonathan

  Banks, Matthew (Southport)

  Alexander, Richard

  Banks, Robert (Harrogate)

  Alison, Rt Hon Michael (Selby)

  Batiste, Spencer

  Amess, David

  Bellingham, Henry

  Arbuthnot, James

  Bendall, Vivian

  Arnold, Jacques (Gravesham)

  Beresford, Sir Paul

  Arnold, Sir Thomas (Hazel Grv)

  Biffen, Rt Hon John

  Ashby, David

  Bonsor, Sir Nicholas

  Atkins, Rt Hon Robert

  Booth, Hartley

  Atkinson, David (Bour'mouth E)

  Boswell, Tim

  Atkinson, Peter (Hexham)

  Bottomley, Peter (Eltham)

  Baker, Rt Hon Kenneth (Mole V)

  Bottomley, Rt Hon Virginia

  Baker, Nicholas (North Dorset)

  Bowis, John

  766

  Boyson, Rt Hon Sir Rhodes

  Gorst Sir John

  Brandreth, Gyles

  Grant, Sir A (SW Cambs)

  Brazier, Julian

  Greenway, Harry (Ealing N)

  Bright, Sir Graham

  Greenway, John (Ryedale)

  Brooke, Rt Hon Peter

  Griffiths, Peter (Portsmouth, N)

  Brown, M (Brigg & Cl'thorpes)

  Grylls, Sir Michael

  Browning, Mrs Angela

  Gummer, Rt Hon John Selwyn

  Bruce, Ian (Dorset)

  Hague, Rt Hon William

  Budgen, Nicholas

  Hamilton, Sir Archibald

  Burns, Simon

  Hamilton, Neil (Tatton)

  Burt, Alistair

  Hampson, Dr Keith

  Butcher, John

  Hanley, Rt Hon Jeremy

  Butler, Peter

  Hannam, Sir John

  Butterfill, John

  Hargreaves, Andrew

  Carlisle, John (Luton North)

  Harris, David

  Carlisle, Sir Kenneth (Lincoln)

  Haselhurst, Sir Alan

  Carrington, Matthew

  Hawkins, Nick

  Carttiss, Michael

  Hawksley, Warren

  Cash, William

  Hayes, Jerry

  Channon, Rt Hon Paul

  Heald, Oliver

  Chapman, Sir Sydney

  Heath, Rt Hon Sir Edward

  Churchill, Mr

  Heathcoat-Amory, David

  Clark, Dr Michael (Rochford)

  Hendry, Charles

  Clarke, Rt Hon Kenneth (Ru'clif)

  Hicks, Robert

  Clifton-Brown, Geoffrey

  Higgins, Rt Hon Sir Terence

  Coe, Sebastian

  Hill, James (Southampton Test)

  Congdon, David

  Hogg, Rt Hon Douglas (G'tham)

  Coombs, Anthony (Wyre For'st)

  Horam, John

  Coombs, Simon (Swindon)

  Hordern, Rt Hon Sir Peter

  Cope, Rt Hon Sir John

  Howell, Rt Hon David (G'dford)

  Cormack, Sir Patrick

  Howell, Sir Ralph (N Norfolk)

  Couchman, James

  Hughes, Robert G (Harrow W)

  Cran, James

  Hunt, Rt Hon David (Wirral W)

  Currie, Mrs Edwina (S D'by'ire)

  Hunt, Sir John (Ravensbourne)

  Curry, David (Skipton & Ripon)

  Hunter, Andrew

  Davies, Quentin (Stamford)

  Hurd, Rt Hon Douglas

  Day, Stephen

  Jack, Michael

  Deva, Nirj Joseph

  Jackson, Robert (Wantage)

  Devlin, Tim

  Jenkin, Bernard

  Dorrell, Rt Hon Stephen

  Jessel, Toby

  Douglas-Hamilton, Lord James

  Johnson Smith, Sir Geoffrey

  Dover, Den

  Jones, Gwilym (Cardiff N)

  Duncan-Smith, Iain

  Jones, Robert B (W Hertfdshr)

  Dunn, Bob

  Jopling, Rt Hon Michael

  Durant, Sir Anthony

  Kellett-Bowman, Dame Elaine

  Eggar, Rt Hon Tim

  King, Rt Hon Tom

  Elletson, Harold

  Kirkhope, Timothy

  Emery, Rt Hon Sir Peter

  Knapman, Roger

  Evans, David (Welwyn Hatfield)

  Knight, Mrs Angela (Erewash)

  Evans, Jonathan (Brecon)

  Knight, Rt Hon Greg (Derby N)

  Evans, Nigel (Ribble Valley)

  Knight, Dame Jill (Bir'm E'st'n)

  Evans, Roger (Monmouth)

  Knox, Sir David

  Evennett, David

  Kynoch, George (Kincardine)

  Faber, David

  Lait, Mrs Jacqui

  Fabricant, Michael

  Lang, Rt Hon Ian

  Fenner, Dame Peggy

  Lawrence, Sir Ivan

  Field, Barry (Isle of Wight)

  Legg, Barry

  Fishburn, Dudley

  Leigh, Edward

  Forman, Nigel

  Lennox-Boyd, Sir Mark

  Forsyth, Rt Hon Michael (Stirling)

  Lester, Jim (Broxtowe)

  Forth, Eric

  Lidington, David

  Fowler, Rt Hon Sir Norman

  Lightbown, Sir David

  Fox, Dr Liam (Woodspring)

  Lloyd, Rt Hon Sir Peter (Fareham)

  Fox, Sir Marcus (Shipley)

  Lord, Michael

  Freeman, Rt Hon Roger

  Luff, Peter

  French, Douglas

  McCrea, The Reverend William

  Fry, Sir Peter

  MacKay, Andrew

  Gale, Roger

  Maclean, Rt Hon David

  Gallie, Phil

  McLoughlin, Patrick

  Garel-Jones, Rt Hon Tristan

  McNair-Wilson, Sir Patrick

  Garnier, Edward

  Madel, Sir David

  Gill, Christopher

  Maitland, Lady Olga

  Gillan, Cheryl

  Malone, Gerald

  Goodlad, Rt Hon Alastair

  Mans, Keith

  Goodson-Wickes, Dr Charles

  Marland, Paul

  Gorman, Mrs Teresa

  Marlow, Tony

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  Marshall, John (Hendon S)

  Smyth, The Reverend Martin

  Marshall, Sir Michael (Arundel)

  Soames, Nicholas

  Martin, David (Portsmouth S)

  Speed, Sir Keith

  Mates, Michael

  Spencer, Sir Derek

  Mawhinney, Rt Hon Dr Brian

  Spicer, Sir James (W Dorset)

  Mellor, Rt Hon David

  Spicer, Michael (S Worcs)

  Merchant, Piers

  Spink, Dr Robert

  Mills, Iain

  Spring, Richard

  Mitchell, Andrew (Gedling)

  Sproat, Iain

  Mitchell, Sir David (NW Hants)

  Squire, Robin (Hornchurch)

  Moate, Sir Roger

  Stanley, Rt Hon Sir John

  Molyneaux, Rt Hon James

  Steen, Anthony

  Monro, Rt Hon Sir Hector

  Stephen, Michael

  Montgomery, Sir Fergus

  Stern, Michael

  Neednam, Rt Hon Richard

  Stewart, Allan

  Neubert, Sir Michael

  Streeter, Gary

  Newton, Rt Hon Tony

  Sumberg, David

  Nicholls, Patrick

  Sweeney, Walter

  Nicholson, David (Taunton)

  Sykes, John

  Nicholson, Emma (Devon West)

  Tapsell, Sir Peter

  Norris, Steve

  Taylor, Ian (Esher)

  Onslow, Rt Hon Sir Cranley

  Taylor, John M (Solihull)

  Oppenheim, Phillip

  Temple-Morris, Peter

  Ottaway, Richard

  Thomason, Roy

  Page, Richard

  Thompson, Patrick (Norwich N)

  Paice, James

  Thornton, Sir Malcolm

  Patrick, Sir Irvine

  Thurnham, Peter

  Patten, Rt Hon John

  Townend, John (Bridlington)

  Pattie, Rt Hon Sir Geoffrey

  Townsend, Cyril D (Bexl'yh'th)

  Pawsey, James

  Tracey, Richard

  Peacock, Mrs Elizabeth

  Tredinnick, David

  Pickles, Eric

  Trend, Michael

  Porter, Barry (Wirral S)

  Twinn, Dr Ian

  Porter, David (Waveney)

  Vaughan, Sir Gerard

  Portillo, Rt Hon Michael

  Viggers, Peter

  Powell, William (Corby)

  Waldegrave, Rt Hon William

  Walden, George

  Rathbone, Tim

  Walker Bill (N Tayside)

  Redwood, Rt Hon John

  Waller, Gary

  Renton, Rt Hon Tim

  Ward, John

  Richards, Rod

  Wardle, Charles (Bexhill)

  Riddick, Graham

  Waterson, Nigel

  Robathan, Andrew

  Watts, John

  Roberts, Rt Hon Sir Wyn

  Wells, Bowen

  Robertson, Raymond (Ab'd'n S)

  Wheeler, Rt Hon Sir John

  Robinson, Mark (Somerton)

  Whitney, Ray

  Roe, Mrs Marion (Broxbourne)

  Whittingdale, John

  Rowe, Andrew (Mid Kent)

  Widdecombe, Ann

  Rumbold, Rt Hon Dame Angela

  Wiggin, Sir Jerry

  Sackville, Tom

  Wilkinson, John

  Sainsbury, Rt Hon Sir Timothy

  Willetts, David

  Scott, Rt Hon Sir Nicholas

  Wilshire, David

  Shaw, Sir Giles (Pudsey)

  Winterton, Mrs Ann (Congleton)

  Shephard, Rt Hon Gillian

  Winterton, Nicholas (Macc'fld)

  Shepherd, Colin (Hereford)

  Wolfson, Mark

  Shepherd, Richard (Aldridge)

  Wood, Timothy

  Shersby, Sir Michael

  Yeo, Tim

  Sims, Roger

  Skeet, Sir Trevor

  Tellers for the Noes:

  Smith, Sir Dudley (Warwick)

  Mr. Derek Conway and

  Smith, Tim (Beaconsfield)

  Mr. Michael Bates.

  Question accordingly negatived.
  Main Question put and agreed to.
  Resolved,
  That an humble Address be presented to Her Majesty, as follows:—
  Most Gracious Sovereign,
  We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament.

  BUSINESS OF THE HOUSE
  Ordered,
  That, at the sitting on Tuesday 5th December, the Speaker shall put forthwith the Questions necessary to dispose of proceedings on the Motion in the name of the Prime Minister relating to public expenditure, including the Question on any amendment thereto which she may have selected, and the said Questions may be decided after the expiry of the time for opposed business.—[Mr. Willetts.]

PETITION

  Deeping Bypass
  10.28 pm
  Mr. Quentin Davies: I beg to present a petition signed by 6,000 inhabitants of the villages of Market Deeping and Deeping St. James in my constituency, which begs for the rapid construction of the Deeping bypass, which I have had occasion to mention in the House before. We have been waiting for the bypass since 1939, when the idea was mooted. It was in the 1989 Government road programme, but was removed from that programme in 1993 because of public expenditure cuts. We very much hope that it will be constructed in the new future, because it is vital not merely for the economy and the amenity of my constituents but also for their safety. Over the past two months there have been three serious accidents, with one fatality, in an area that would be bypassed if the bypass were constructed.
  I hope that the voices of those 6,000 of my constituents, who represent more than three quarters of the adult population of the two villages concerned, will be heard in the right quarter in the way that they deserve.
  To lie upon the Table.

  Social Services (Lancashire)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Bates.]
  10.29 pm
  Mr. Harold Elletson: I am grateful for the opportunity to discuss the provision of social services in Lancashire. There has been much debate recently about the implementation of the community care reforms, and about the way in which local authorities have met their responsibilities for the management of social services.
  There has been widespread support on both sides of the House for the concept of care in the community, and there is no doubt that it was the right policy, and that the Government were right to implement it. Like most hon. Members, I fully support the concept of offering choice to service users, to enable them to live in their own homes wherever possible and to allow them a greater say in how they live their lives.
  It is now just over two years since implementation of the reforms began, and clearly it has been a much greater success in some parts of the country than in others. Tonight I shall concentrate on the local situation in Lancashire, and examine the extent to which the county council has met the challenge of care in the community and fulfilled its new responsibilities. I have to say that it is a far from happy story, and that Lancashire's experience has been a catalogue of incompetence, mismanagement and, in consequence, utterly avoidable misery.
  Mr. Nick Hawkins: Does my hon. Friend agree that it is probably owing to the total incompetence of the Lancashire county council Labour group that not only has no Lancashire Labour Member bothered to be here for the debate but that there is only one Labour Member in the Chamber at all—the hon. Member for Motherwell, North (Dr. Reid)—and even he is here by mistake?
  Mr. Elletson: As usual, my hon. Friend makes an extremely good point, and I am sure that it was not lost on my other hon. Friends, or on the representatives of the press in the Gallery.
  First, let me dispel the myth cynically propagated by the Labour leadership at county hall—that Lancashire's woes are the result of Government underfunding. As my hon. Friends, including the Minister, all know, Lancashire's Labour councillors are experts in black propaganda and in the techniques of twisting and manipulating statistics to distort the truth. They are also compulsive spenders, with a disgraceful record of wasting public money on bureaucracy.
  Dame Elaine Kellett-Bowman: Lancashire Labour councillors may be compulsive spenders on things other than education, but on education they are compulsive underspenders.
  Mr. Elletson: I agree absolutely with my hon. Friend. Perhaps we could discuss education in another Adjournment debate on another day, because that is an equally important and urgent topic.
  There is nothing that Lancashire county councillors would like more than to blame their misfortunes on the
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  Government—and, of course, in a local election year that is exactly what they have been trying to do. However, the truth is very different.
  The total amount available to Lancashire county council to spend on social services has consistently increased since 1990–91, when total funding of social services was £92 million. In 1993–94, £147 million was available to the county council to spend on personal social services; in 1994–95, £169 million was available, and in 1995–96 there is £185 million available. The sum that Lancashire county council received last year to spend on social services represented an increase of £22.6 million on the previous year.
  The truth is that there has been a continuous year-on-year increase in the resources available, yet Lancashire's mismanagement of the funding available has left it in an appalling predicament. In 1993–94 the county council recorded an underspend on the social services budget of £6.3 million and, despite the recommendation of the Conservative group on the council that the amount be carried forward, Labour refused to do that, and decided instead to build up the balances.
  Last year, the council got itself into a position where it was faced with a possible overspend of £14 million, so it decided to threaten elderly and disabled people with the withdrawal of their home help services.
  Dame Elaine Kellett-Bowman: It was to happen overnight.
  Mr. Elletson: I agree with my hon. Friend. I am sure that all my hon. Friends remember that letters were sent from county hall which terrified some of Lancashire's most vulnerable citizens. This year, the draconian cuts will be implemented because the county council cannot manage the available resources. It cannot balance the books, and it is spending above the level of its personal social services standard spending assessment. Once again, the Labour-controlled council blames a reduction in Government funding.
  Mr. Nigel Evans: Does my hon. Friend agree that the council's inept handling of its budget has meant that people who receive only one hour a week of home help have received letters from the county council to say that that one hour's help is to be removed? Does he agree that the county council has stated to the most vulnerable people in society that their money and help are to taken away from them, and does he further agree that those people will suffer because of that?
  Mr. Elletson: I agree with my hon. Friend, and I know that his constituency postbag is as full as mine. My postbag is filled with letters from constituents who have to face reductions in social services such as respite care and home help. Many people, such as people with learning difficulties, now face an increase in their charges for non-residential services.
  Many cases have been drawn to my attention by people who are at a complete loss as to what to do. It is difficult to single out one case among all those to draw to the Minister's attention tonight, but let me tell him about Geraldine Robinson. Geraldine's picture appeared on the front cover of a Lancashire county council leaflet advertising the care services that it proudly claims it provides to people in the community.

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  Geraldine is a young woman who suffers from cerebral palsy. She was fully assessed by Lancashire county council social services in March 1994, and a care package designed specifically for her was finalised in June that year, which provided her with a cost-effective, 24-hour care service package. It enabled her to live an independent life in the community, and it had been based on an assessment of her clinical needs—just as the Government intended. Yet in June of this year, Lancashire county council, which was the author, the House may remember, of the leaflet showing Geraldine's picture and claiming to be able to cater for her needs, told her that her care package would be cut from £700 to £300 a week—not reduced, not trimmed, but cut by more than a half.
  Despite several attempts by Geraldine and her carers to question why this decision had been taken, no answer has yet been forthcoming. I can only conclude—as any reasonable person would—that Geraldine is another casualty of the council's inability to manage its resources and keep within its budget.
  Mr. Colin Pickthall: Will the hon. Gentleman give way?
  Mr. Elletson: No, I will not give way to the hon. Gentleman, as I have given way three times already. Normally, there would have to be a reassessment before a care package was reduced, but that did not happen. The council said that its only alternative to reducing her care package would be to force Geraldine into residential care. Of course, she is extremely distressed about that. She has been trying to build a life for herself in the community, and she was encouraged by the county council to live independently, and even to move to a two-bedroomed property to allow more space for her carers.
  Geraldine has overcome many personal tragedies, including the death of her fiancé in December 1993, but now the county council is turning on her the full pressure of its callous and insensitive bureaucracy. The social services department's actions in the past year have had a massive impact on Geraldine's life. She now has to undergo another comprehensive reassessment at a level the council is unwilling to identify, despite the fact that no significant major change in circumstances or Geraldine's needs or condition has occurred. That is not care in the community, or giving disabled and vulnerable people a greater say in their own lives. That is not enabling people to live in their own home. It is the incompetence of a county administration that has failed miserably to discharge its responsibilities to its most vulnerable citizens.
  If the money is not to be spent on people such as Geraldine, where is it to go? I want to know what the priorities of Lancashire social services departments are. Let us look at the case of another young woman far less deserving and needy than Geraldine. She is a constituent of my right hon. Friend the Member for South Ribble (Mr. Atkins). Lancashire county council managed to find £2,000 a week for a course of remedial treatment so that she could go on a three-month riding course in Ireland and spend a considerable time in Australia—all, of course, in the company of social workers.
  Mr. Robert Atkins: Is my hon. Friend aware that, at the same time, the county council was prepared to close a home called Meadowcroft in my constituency which provided superb care for young
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  women who would not otherwise get the sort of care that they needed, in favour of keeping open a home in Liverpool—outside the county council area? The closure has caused great distress to many of my constituents and many of those associated with Meadowcroft, at the same time as wasting the sort of money that my hon. Friend has mentioned in the context of one case.
  Mr. Elletson: I have heard of the case that my hon. Friend mentions. It is an equally disgraceful example of the misallocation of resources.
  Perhaps the main priority of the social services department is to fund the ever-increasing numbers of administrators and bureaucrats in county hall. In the last financial year the social services department employed 203 extra members of staff. That was undoubtedly to deal with the appalling chaos that the department has created by its mismanagement of the assessment procedures. What is even more ironic—this whole sorry tale is a web of ironies—having taken on all the extra staff, the council now finds that it cannot pay them to do anything. I am sure that my hon. Friends will have noticed that today's Lancashire Evening Post tells us that social services workers are being told not to visit clients because the county council cannot afford their mileage.
  The worst damage being done is to the people who could make a real success of care in the community—those in the private sector and the voluntary services. Lancashire county council has consistently favoured placement of clients in council-run residential homes over placement in independently run homes, even though the private sector can provide the same or a better quality of service at a lower price. Many of my colleagues have joined me in correspondence with the Lancashire Care Association, which represents more than 400 independent care providers across the county. Its members employ more than 15,000 staff and care for more than 10, 000 people.
  The Lancashire Care Association tells me that the county council social services department has a written policy that all domiciliary services should be offered in-house before being offered to the private sector. If that is true, it is absolutely disgraceful. I hope that the Minister will ensure that the social services inspectorate fully investigates that claim as early as possible.
  Let us take a moment to consider the financial implications of Lancashire county council's policy. The cost of placements in, for example, part III social services homes, is £100 per week more than placements in the private sector. The cost of council-run domiciliary services ranges between £11.20 and £17 an hour, but all private sector services are priced between £5.75 and £6 per hour, which is a massive saving on in-house costs.
  Dame Elaine Kellett-Bowman: Is that not a case for the district auditor?
  Mr. Elletson: My hon. Friend has a good point. It is clear that substantial savings could be made if the council made better use of the private sector. Possibly as much as £10 million a year in the residential care sector and £4.5 million in the domiciliary care sector could be saved, yet the council appears to have no intention of using the private care sector. When the chairman of the social services committee, Councillor Mrs. Humble, took part in a programme on a local radio station and was asked by members of the Lancashire Care Association about the

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  possibility of buying more private non-residential care services, she told them—wait for it, my hon. Friends will not believe it—that she was not prepared to put local authority staff jobs in jeopardy.
  Does her concern for local authority bureaucrats justify such a prolific waste of taxpayer's money? Why does she not care about the jobs of workers in the private sector? What is wrong with them? Perhaps she should start thinking about the 15,000 employees of the various members of the Lancashire Care Association, who do a fantastic job, which day by day she makes more difficult.
  Dr. John Reid: Will the hon. Gentleman give way?
  Mr. Elletson: No, because I have given way a record five times in an Adjournment debate.
  Lancashire social services department has issued its community care plan for 1997–97, which shows that costly in-house services will continue to be favoured. While that policy continues, the private sector struggles to remain solvent and service users' choices are severely restricted.
  An integral part of the reforms was the requirement that a large percentage of the available funds would be spent on residential, day or domiciliary services, provided by the private and voluntary sector. That was to ensure that authorities could not build monopoly empires of their own and to encourage the growth of a healthy, energetic private sector, which was ready to meet the challenge of care in the community, with high-quality, cost-effective care packages.
  The new system was designed to encourage local authorities to contract services out and to make more use of the independent sector. That clearly has not happened in Lancashire. Private carers are being forced out of business and service users are being driven into the clutches of Lancashire county council. That is the very opposite of everything for which we hoped from care in the community, and I hope that my hon. Friend will consider carefully the amounts that the county council is spending in the private sector and ask the social services inspectorate to consider whether that really meets the objectives of care in the community.
  I am grateful to my hon. Friend the Under-Secretary for agreeing to reply to the debate. I know that he has been consistently bombarded with complaints about Lancashire county council and that he might feel that his hands are tied. Nevertheless, the situation in Lancashire is now so chaotic that it merits his special attention and a determined effort by the Government to intervene and protect service users and providers.
  My hon. Friend the Under-Secretary and my hon. Friends may find some small amount of black humour in this final twist of irony. They may have heard that the leader of Lancashire county council, Councillor Louise Ellman, has been selected for a so-called safe Labour seat on Merseyside and hopes to join us here on these green Benches. I hear my hon. Friends asking who will replace her as the leader of the Labour group on Lancashire county council and I think I heard the hon. Member for Motherwell, North (Dr. Reid) mention a name.
  Why, it is none other than the author of this great disaster. Step forward the woman who has presided over that colossal orgy of incompetence—none other than the
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  chairman of the social services committee, Councillor Mrs. Joan Humble. I just hope that the people of Lancashire understand what a nightmare of bureaucracy, sloppy management and cynicism they will face if she ever gets control of the rest of Lancashire's services.
  10.47 pm
  The Parliamentary Under-Secretary of State for Health (Mr. John Bowis): I thank my hon. Friend the Member for Blackpool, North (Mr. Elletson) for introducing this short debate on Lancashire's social services and congratulate him on bringing with him the Lancashire light infantry from Ribble Valley, Blackpool, South, Fylde, South Ribble, Wyre and, indeed, from Lancaster. They are light on their feet, as well as infantry in his support.
  In most parts of the country, community care is a success story. We have been moving on with our plans, through our community care development programme. Our Community Care (Direct Payments) Bill was introduced in another place last week. In April, we will be moving through our community care charters and, from April, the Carers (Recognition and Services) Act 1995 will come into force, giving carers a legal right to have their views and circumstances taken into account when the person being cared for receives a community care assessment.
  The common thread running through all those developments is that they are designed to increase user and carer choice and control. They are all examples of way in which the Government are pushing forward the implementation of the community care reforms to get us closer to achieving fully the aims of "Caring for People".
  We are committed to providing people with increased choice in the type of service that they receive and in the way in which the services are delivered.
  Mr. Keith Mans: I apologise for asking a question so early in my hon. Friend's speech. He well knows that, a couple of months after the start of care in the community, nearly three years ago, I told him about what was going on in Lancashire. I fully understand that, at the time, he felt that he had to wait a little longer to discover whether it was true. On the ground, we can now see the suffering of many constituents—my own and those of other hon. Members in Lancashire, as a result of three years of incompetent management. There must be a way for central Government to intervene. If there is not, it is a sad day for the people of Lancashire who, need the care to which they are entitled.
  Mr. Bowis: I am grateful for that intervention. If my hon. Friend will bear with me, I will try to respond to the points that he and my other hon. Friends have made.
  It is disturbing to hear of cases where the involvement of users and carers, and the possibility of choice, is being denied. It is right to involve user and carers, listen to what they say and take note of it, to give them choices wherever possible, and to ensure that they know what choices they have.
  My hon. Friend the Member for Blackpool, North mentioned the case of Geraldine Robinson. I am grateful to him for letting me have information about her. He has explained that Geraldine Robinson and her parents are upset at the way in which Lancashire has carried out

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  assessments and reassessments and are concerned that her care package may be reduced. Local authorities have the responsibility for assessing people's needs and deciding what services are appropriate to meet those needs. We have advised local authorities to carry out reviews of assessment systematically and regularly. We have not said how often reviews should take place or exactly how they should be done because the appropriate frequency and level of review will vary from case to case, depending on individual circumstances.
  I understand that Miss Robinson's father lodged a complaint with the social services department about the way that it was carrying out its reviews. As a result, it was agreed that an assessment interview should be carried out by someone who had had no previous contact with Miss Robinson. I am told that that interview took place on Tuesday of last week and that Lancashire has not to date made any proposal to alter her care package as a result of that assessment. Clearly, Lancashire should conduct its reviews in a way which not only meets its service requirements but which is sensitive to Miss Robinson's situation and views. I intend to ask my officials to look into the current position on this case, and I shall come back to my hon. Friend the Member for Blackpool, North on that.
  Mr. Pickthall rose—
  Mr. Bowis: I think that the tradition is to give way in Adjournment debates only to those who have previously agreed it with the Member who has obtained the debate and the responding Minister. I have given way to everyone who falls into that category.
  Dr. Reid: On a point of order, Madam Deputy Speaker. How can we possibly have a debate when only one side of the argument is heard?
  Mr. Robert Atkins: It is an Adjournment debate.
  Dr. Reid: A debate, by definition, involves two sides of an argument. How can it be in order to have a debate where the convention is that only side of the argument is heard?
  Madam Deputy Speaker: This is an Adjournment debate. By tradition, it involves the Member who raises the subject and the Minister who answers. Any other speaker is by courtesy of both.
  Mr. Bowis: It is not unreasonable to expect adults who are able to make contributions for non-residential services to do so, but local authorities have discretion to make charges for non-residential services. They decide whether to make them, what level they should be at and on any exemptions or discounts for different categories of users. Any charges must be reasonable and affordable.
  If people with learning difficulties in Lancashire are being charged, that is absolutely and entirely at the discretion and decision of the elected leaders of Lancashire county council and it has nothing to do with the Government. Nothing from the Government requires that such charges must be made. I hope that that message will go back to those people.
  Extending choice means extending the range of services and improving their cost-effectiveness so that more and better services can be delivered. There is a flourishing
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  independent sector for residential care and nursing homes and a growing range of day and domiciliary services provided by the independent sector. As my hon. Friend says, they offer the opportunity for local authorities to secure quality services at a competitive cost. All over the country, this opportunity is being seized but not, apparently, in Lancashire. I wonder why.
  As my hon. Friend said, the Lancashire Homes Association has estimated that the county council could save £10.8 million a year if it made full use of the independent sector, such is the level of inefficiency in its own homes. Potential savings from the full use of the independent sector have been put at 14 million annually. That is money that could be invested in more care for more people. Some months ago, I went to the county council in Preston and put those figures to the leader of the council and the chairman of social services. To this day, they have not disputed or denied them. Instead of using all the means at its disposal to get more care for more people, the county council still, as we hear, gives first call to its in-house domiciliary and residential services.
  Local authorities asked for and were given the responsibility for community care, for assessing the needs of individuals and for deciding on the appropriate services to meet those needs. They must now deliver, and local people will watch the way in which they are doing.
  My hon. Friend has posed the question, reinforced by my hon. Friend the Member for Wyre, about what can be done. A lot can be done by publicising the decisions that are being taken—or not being taken. As a result of the concerns expressed in this debate today and generally, I intend to ask the chief inspector of social services to provide me with a full report on the position in Lancashire so that I can then decide whether further action by central Government is appropriate.
  The primary responsibility for community care implementation lies with local authorities. They must answer to their local populations for their decisions and the results that those decisions have on the elderly and vulnerable people for whom they are supposed to care. The people of Lancashire will want to ask the elected leaders of their county council about the delivery of community care in their area. They will want to ask about choice, about value for money and about the way in which the authority is seeking to involve them, or not, to listen, or not, and to meet their needs, or not.
  Mr. Hawkins: Will my hon. Friend ensure that in the inquiry, which all Conservative Members here are delighted he has announced tonight, evidence is taken from the senior and experienced general practitioners in our constituencies? They are aware of how often good, sensible decisions about the best place and the best way in which to care for the elderly and vulnerable are being contradicted by social workers who do not know what they are doing and who do not care.
  Mr. Bowis: I shall look at that possibility. I hope that, in any case, my hon. Friend will ensure that the information that can come from the experience of general practitioners—I have heard some of it directly when I have been in Blackpool—is given to me so that it can be passed on to the chief inspector and his team.
  The people of Lancashire will want to know why money is wasted on state provision when better and cheaper services are available from independent homes

  777
  and agencies. They will want to know why Lancashire's councillors prefer to support the state sector so that less money is available for home helps, respite care and other services to support vulnerable and needy people. They will want to know what Lancashire has done with the £92 million that the taxpayers have given it for social services
  778
  this year; the amount has been doubled since 1990–91. I, my hon. Friends here tonight and, much more importantly, the people of Lancashire want to know the answer to that question, and they have a right to be told.
  Question put and agreed to.
  Adjourned accordingly at two minutes to Eleven o'clock.

ATTORNEY-GENERAL

  Invoices
  Mrs. Roche
  To ask the Attorney-General what is the average length of time it takes for his Department to pay invoices. [934]

  The Attorney-General
  The information available for the Law Officers' Departments is as follows:

  Over recent sample periods the average time between receipt of a valid invoice and payment was 17 days for the Serious Fraud Office, and 35 days for the Treasury Solicitor's Department. The Government Property Lawyers process all claims within five days.

  The Crown Prosecution Service pays over 80 per cent. of witness expense claims within 10 working days.

  Mrs. Roche
  To ask the Attorney-General how his Department publicises payment practices other than as percentages of invoices paid late. [951]

  The Attorney-General
  The Departments for which I am responsible make every effort to settle invoices promptly and in accordance with the requirements published in Government Accounting. Information about those Department's payment practices is published in the annual departmental report of the Lord Chancellor's and Law Officer's Departments.

  In addition, the performance of the Crown Prosecution Service against its target of paying claims for witness expenses within 10 working days is published in its statutory annual report.

  Invitations to tender issued by the Treasury Solicitor's Department also contain a reference to the effect that payment will be made within 30 days of receipt of a valid invoice.

  The Government Property Lawyers publish details of payment policy in the annual report and accounts.

LORD CHANCELLOR'S DEPARTMENT

  Invoices
  Mrs. Roche
  To ask the Parliamentary Secretary, Lord Chancellor's Department how his Department publicises payment practices other than as percentages of invoices paid late. [961]

  Mr. John M. Taylor
  The Department's general conditions of contract contain a clause informing suppliers that we shall make a payment within agreed terms, or within 30 days of receipt of an invoice, where no such terms exist. The conditions also give advice on how to complain if the Department fails to make payment on time. Annual surveys of invoice payments are carried out,108
  the latest of which showed that 93.9 per cent. of invoices were paid on time. A further survey is being carried out of invoices authorised for payment during the month of November. The survey results, together with details of the Department's payment policies, are published in the Department's annual report.

  Mrs. Roche
  To ask the Parliamentary Secretary, Lord Chancellor's Department what is the average length of time it takes for his Department to pay invoices. [927]

  Mr. Taylor
  The information required to answer the question is not recorded centrally. An examination of the procedures for paying invoices throughout the Department has shown that, on average, invoices are paid within seven days of receipt.

  Lockerbie
  Mr. Dalyell
  To ask the Parliamentary Secretary, Lord Chancellor's Department how many officials of his Department are part-time involved in legal matters relating to the destruction of the airliner Pan Am 103 over Lockerbie. [1630]

  Mr. John M. Taylor
  None.

  Antarctic Minerals
  Mr. Gordon Prentice
  To ask the Parliamentary Secretary, Lord Chancellor's Department for what reasons the Antarctic Minerals Act 1989 has not fully been brought into force; and when he intends to fully bring it into force. [196]

  Sir Nicholas Bonsor
  I have been asked to reply.

  The Convention on the Regulation of Antarctic Mineral Resource Activities (CRAMRA) has, in effect, been superseded by the 1991 environmental protocol to the Antarctic treaty. Provisions to enable the United Kingdom to ratify the protocol were included in Antarctic Act 1994. The Act also repealed the Antarctic Minerals Act 1989, except for provisions relating only to the administration of justice for the British Antarctic Territory.

TREASURY

  Invoices
  Mrs. Roche
  To ask the Chancellor of the Exchequer what is the amount owed to those businesses whose invoices were not paid within 30 days of receipt or in accordance with contractual agreements in each of the last five years. [1117]

  Mrs. Angela Knight
  Records of the promptness of payment for the past five years are not maintained. Over the past three years, the amount owed to businesses whose invoices were not paid within 30 days of receipt was:

  1993–94: £1,006K

  1994–95: £1,689K

  1995–96 to date: £818K

  The majority of the invoices to which the sums above relate were delayed due to problems associated with the particular suppliers such as an error in the invoice or failure to deliver the goods or service.
  109
  Mrs. Roche
  To ask the Chancellor of the Exchequer how many (i) orders and (ii) firms are represented by the 18 per cent. of invoices not paid by his Department within 30 days or in accordance with contractual agreements in 1994–95; how many of those are related to firms with fewer than 500 employees. [912]

  Mrs. Knight
  The number of (i) orders and (ii) firms represented by the 18 per cent. of invoices not paid within 30 days is shown in the table:

  (i) orders: 380

  (ii) firms: 152

  These figures include invoices which were delayed due to problems associated with the particular suppliers such as an error in the invoice or failure to deliver the goods or service.

  The Treasury does not distinguish between different sizes of suppliers. Information on how many of those invoices relate to firms with fewer than 500 employees is not available.

  Mrs. Roche
  To ask the Chancellor of the Exchequer what is the average length of time it takes for his Department to pay invoices. [919]

  Mrs. Knight
  The average number of days taken to pay invoices is 23 days from date of receipt.

  This includes invoices which were delayed due to problems associated with the particular suppliers such as an error in the invoice or failure to deliver the goods or service.

  Mrs. Roche
  To ask the Chancellor of the Exchequer how his Department publicises payment practices other than as percentages of invoices paid late. [969]

  Mrs. Knight
  Departmental payment performance figures are published annually within the Chancellor of the Exchequer's departmental report. Figures are given showing the percentage of invoices paid within 30 days of receipt of an invoice or within the payment period specified in a contract if different.

  Alcohol and Tobacco (Cross-border Trade)
  Mr. Robert Ainsworth
  To ask the Chancellor of the Exchequer what is the present estimated annual value of revenue lost to the Exchequer because of illicit cross-border trade in alcoholic and tobacco products. [80]

  Mr. Heathcoat-Amory
  By its nature, the scale of illicit cross-border trade in alcohol and tobacco is very difficult to assess. Reliable figures are not available. Officials are working closely with United Kingdom trade representatives to determine whether a satisfactory method of estimating the value of this trade can be developed.

  European Monetary Institute
  Mr. Austin Mitchell
  To ask the Chancellor of the Exchequer (1) who represents Britain on the European Monetary Institute; whose policy they articulate; whom they report to; and what is their brief in respect of monetary union; [1101]

  (2) who represents Britain in the European Monetary Institute; and which body determines United Kingdom policy in respect of the institute. [545]
  110
  Mrs. Angela Knight
  In accordance with the terms of article 109f of the EC Treaty, and article 1 of the protocol on the statute of the European Monetary Institute annexed to the treaty, the Bank of England is a member of the EMI, and the Governor of the Bank of England is a member of the EMI's council. Active participation by the Governor on the council of the EMI is in accordance with the Government's policy of full involvement in preparations for economic and monetary union, which the Government believe is necessary to protect our interest whether or not the UK participates in the single currency.

  Monetary Union
  Mr. Austin Mitchell
  To ask the Chancellor of the Exchequer what obligations are imposed on the United Kingdom and what changes have to be made to British economic policy to allow the United Kingdom to qualify for monetary union and to take Her Majesty's Government to the point at which it can decide to enter monetary union or not. [1106]

  Mrs. Angela Knight
  The Council, meeting in the composition of Heads of State and Government, will decide for each member state whether it fulfils the necessary conditions for the adoption of a single currency, in accordance with the provisions of article 109j of the EC treaty and protocol No. 6 on the convergence criteria. Protocol No. 11, annexed to the EC treaty, means that the United Kingdom shall not be obliged or committed to move to the third stage of economic union without a separate decision to do so by the Government and Parliament. We will agree to take part in a single currency only if it is in our national interest to do so, given the circumstances at the time. The Government's economic policies aim to bear down on inflation and ensure sound public finances. These policies make good economic sense and are entirely consistent with the convergence criteria.

  Value Added Tax
  Mr. Robert Ainsworth
  To ask the Chancellor of the Exchequer what would be the effect on Treasury revenue in 1996–97 and in a full year of extending value added tax at(a) 8 per cent. and (b) 17.5 per cent. to all those zero-rated, giving figures separately for each item. [91]

  Mr. Heathcoat-Amory
  Table 10 of the Treasury publication "Tax Ready Reckoner and Tax Reliefs" shows the estimated cost of not applying standard rate VAT to those items currently zero-rated. Those figures make no allowance for changes in consumer behaviour. It is possible to derive estimates for revenue from 8 per cent. VAT from those figures. The latest figures available are for 1995–96.

  £ million

  8.0 per cent.

  17.5 per cent.

  Food

  3,450

  7,550

  Construction of new dwellings

  820

  1,800

  Domestic passenger transport

  620

  1,350

  International passenger transport

  530

  1,150

  Books, newspapers and magazines

  550

  1,200

  Childrens clothes and shoes

  340

  750

  Water and sewerage services

  410

  900

  111

  £ million

  8.0 per cent.

  17.5 per cent.

  Drugs and medicines on prescription

  300

  650

  Supplies to charities

  90

  200

  Ships and aircraft above a certain size

  210

  450

  Vehicles and other supplies to disabled people

  70

  150

  Ordtech Trials
  Mr. Cohen
  To ask the Chancellor of the Exchequer what has been the total cost to the public funds of the Ordtech trials. [1023]

  Mr. Heathcoat-Amory
  It is not possible at this stage to give a total cost to the public funds of the Ordtech trials. Legal fees paid to date by HM Customs and Excise, as prosecuting authority, amount to £175,808.

OVERSEAS DEVELOPMENT ADMINISTRATION

  Sri Lanka
  Mr. Gapes
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans Her Majesty's Government have to provide humanitarian assistance to displaced people and refugees from the Jaffna area of Sri Lanka. [566]

  Mr. Hanley
  Earlier this month, we provided two emergency aid grants of £250,000 and £100,000 to the International Committee of the Red Cross and Christian Action, Research and Education respectively, to help alleviate the suffering of those affected by the recent fighting. We also provide on-going support, through Save the Children and Oxfam, for relief and rehabilitation programmes which help displaced families. In 1995–96, we expect to spend around £1.2 million on these programmes.

  Aid Programme
  Mrs. Ewing
  To ask the Secretary of State for Foreign and Commonwealth Affairs what(a) percentage and (b) amount of the annual expenditure for overseas aid is channelled through non-governmental organisations (i) in developing countries overall, (ii) in each country and (iii) on each project. [1546]

  Mr. Hanley
  In 1994–95 total expenditure for overseas aid to developing countries was £2.018 billion. Of this, £1.048 billion was in the form of bilateral aid, of which 16.5 per cent. or £173 million was channelled through non-governmental organisations. More detailed breakdowns of this expenditure by individual countries and projects are not available and could be produced only at disproportionate cost.

ENVIRONMENT

  Insulation
  Mr. Hanson
  To ask the Secretary of State for the Environment (1) how many voucher booklets offering discounts on home insulation products were 112
  recently distributed; which body was responsible for producing them; to whom they were distributed; and at what cost; [600]

  (2) how many inquiries about cavity wall insulation were generated because of the television advertising campaign that formed part of the energy efficiency scheme promoted by his Department; [601]

  (3) which body was responsible for the promotion of the cavity wall insulation scheme with which his Department was involved as part of the energy efficiency scheme; and how the body responsible for the promotion was chosen; [602]

  (4) what was the cost to public funds of the recent television campaign promoting cavity wall insulation under the energy efficiency scheme. [603]

  Mr. Robert B. Jones
  The voucher booklets were produced by the Department of the Environment with the aim of increasing the take-up of energy efficiency measures through offers provided by private sector companies and trade associations at their own expense. Cavity wall insulation was only one of 14 different products and services included in the booklet. The voucher book as a whole was supported by television advertising costing £1,232,313.

  Over 5 million voucher books have been distributed direct to owner-occupied older properties which are likely to be able to benefit from the full range of offers included. Distribution costs were £58,750. The voucher books can also be obtained from local energy advice centres and by using press advertisement coupons.

  The cavity wall insulation offer is nominally promoted by InstaGroup, but covers four major fibre-based cavity insulation system designers, the National Cavity Insulation Association and the Cavity Insulation Guarantee Agency. InstaGroup's role as promoter came as a result of agreement among all the participants. All the vouchers are valid at least until the end of the year, and longer in some cases. It is therefore too early to assess the results.

  Housing
  Sir David Mitchell
  To ask the Secretary of State for the Environment what studies or research are being undertaken into the particular care and support requirements in housing of the elderly living in rural areas. [207]

  Mr. Curry
  In 1995, my Department commissioned research into the nature of demand for housing in rural areas including the housing needs of elderly people. A final report is due in July 1996.

  Sir David Mitchell
  To ask the Secretary of State for the Environment what is his policy in respect of local initiatives which provide care and support services, including specialist retirement housing, to meet the needs of elderly home owners in rural areas; and if he will make a statement. [206]

  Mr. Curry
  The Government's policy is that care should be provided to people as far as possible in their existing housing where this is their preference and it is
  113
  cost effective to do so. This policy is supported by the availability of home renovation grants and the work of home improvement agencies.

  Ms Corston
  To ask the Secretary of State for the Environment what assessment he has made of the impact of the introduction of stress area enhancement on the number of new homes built in(a) the south-west and (b) Great Britain. [593]

  Mr. Clappison
  The purpose of stress area enhancement is to channel additional housing resources to those local authority areas with the greatest social, environmental housing problems. Any effect on the number of new homes built is marginal, and the specific information requested is not available.

  Mr. Raynsford
  To ask the Secretary of State for the Environment if he will place in the Library copies of the housing investment programme bids made by each housing authority in England; and if he will summarise the total lists from each region. [975]

  Mr. Curry
  Copies of local authorities' HIP bids for 1996–97 along with strategy statements and associated HIP forms are being collated and will be placed in the Library shortly. Regional summaries of the bids will be placed in the Library when all the bid data have been verified.

  Mr. Carrington
  To ask the Secretary of State for the Environment what action he now intends to take to improve standards in houses in multiple occupation. [2214]

  Mr. Curry
  I am proposing a package of measures which will be able to deal with the problems in this sector of the housing market in a more cost-effective and flexible way than a national mandatory licensing scheme. I intend, therefore, to bring forward legislation as soon as possible.

  There are four principal elements to this legislative package. First, there will be general duty of care placed on HMO landlords with respect to amenity and fire safety standards. Breach of this duty will be a criminal offence punishable by a fine not exceeding level 5 on the standard scale—£5,000. Guidance on the duty will be set out in a national code of practice which will be issued before the new duty is brought into force.

  Secondly, local authorities will be able to introduce a modified form of HMO registration scheme. This will exclude smaller HMOs—those with only two households or with one household and no more than four other occupants—and houses converted entirely into self-contained flats. The registration schemes will contain powers enabling local authorities to refuse to register all properties where conditions are substandard or where management is inadequate. Re-registration will be required after five years and there will be higher fees chargeable to landlords for registration and new re-registration fees at a lower rate. These fees will help local authorities to resource an enhanced programme of enforcement activity.

  Thirdly, I also propose to extend local authorities' existing mandatory duty to ensure that there are adequate fire safety precautions in larger HMOs. This duty will be introduced by statutory instrument and there will be further consultation on its scope, but I am minded to apply it to all HMOs which could come within the scope of the new form of registration scheme providing these
  114
  properties have three storeys or more. I also propose exemptions for specific public sector landlords, but these HMO landlords will of course still be subject to the new duty of care.

  Finally, I shall be introducing some important deregulatory measures by making an order under the Deregulation and Contracting Out Act 1994 to modify some of the local authority HMO enforcement procedures. For the principal HMO enforcement notices, local authorities will be required first to serve a notice informing landlords that they are minded to take action, but this procedure can be dispensed with in emergencies. Where a formal enforcement notice is still required, I propose that local authorities will have power to recover the costs of their enforcement action from the landlord, subject to a maximum amount.

  Local authorities will be required to consult the fire authorities mainly about the exercise of their statutory duty to check fire safety in HMOs, but will no longer have to consult them about HMO enforcement notices served in other circumstances. In addition to this substantial package of new provisions, and as stated in the consultation paper, the new planning controls on the switch from hotel to hostel use will remain in force.

  I share the widespread concern that the rapid expansion of hostels in a number of popular resort areas is causing very serious problems. As these new HMO controls begin to take effect, however, we should see a great improvement in these areas—providing that the local authorities concerned pursue a vigorous programme of enforcement action using their new powers.

  Ms Ruddock
  To ask the Secretary of State for the Environment (1) if the White Paper "Our Future Homes" (CM 2901) was(a) subject to, and (b) modified on account of an environmental appraisal using the guidance contained in "Policy Appraisal and the Environment" produced by his Department; and if he will publish the appraisal; [303]

  (2) what alternative courses of action from those detailed in the White Paper "Our Future Homes" (Cm 2901) were considered in any environmental appraisal undertaken by his Department; [304]

  (3) what procedures have been put in place by his Department to monitor the impacts arising from his implementation of the White paper "Our Future Homes" (Cm 2901). [305]

  Mr. Curry
  The housing White Paper "Our Future Homes" sets out the Government's aim of meeting demand for housing in an environmentally sustainable way, using our resources effectively, building where possible on existing urban land rather than greenfield sites and reducing the number of empty homes. Environmental considerations have been, and continue to be, an integral part of policy development. They have for instance played a large part in decisions made to:

  promote energy efficiency in new and existing homes of all tenures;

  set a target that half of all new homes should be built on re-used sites;

  test the use of EMAS—the EC Eco-Management and Audit Scheme—in the field of housing association policy and programmes.

  115
  The effectiveness of housing policies, including environmental and sustainable development considerations, is reviewed continually.

  General Needs Index
  Ms Corston
  To ask the Secretary of State for the Environment what factors underlay the removal of(a) homelessness and (b) temporary accommodation from the general needs index. [592]

  Mr. Clappison
  We decided to remove those indicators because they do not provide a good measure of the need for investment in social housing. Homelessness figures say much more about the flow of people into existing social rented housing than about the need to build new homes; they are very volatile and their use in allocating capital resources can cause disruption to capital programmes; and they reflect different administrative practice in different local authorities.

  Boulsbury Wood
  Mr. Dafis
  To ask the Secretary of State for the Environment how much public money he estimates will be spent in total to prevent the destruction of Boulsbury wood: who will receive most of the money; and what assessment he has made of the value for money of such expenditure. [374]

  Mr. Clappison
  A management agreement is a commercial arrangement between the nature conservation bodies and the recipient. The financial guidelines make it clear that details of such arrangements cannot be released. The National Audit Office report "Protecting and Managing SSSIs" concluded that agreements reached with English Nature complied with the financial guidelines.

  Leaseholders
  Mr. Raynsford
  To ask the Secretary of State for the Environment how many leaseholders in flats have to date been able to acquire the freehold of their homes under the provisions of part I of the Leasehold Reform Housing and Urban Development Act 1993. [312]

  Mr. Curry
  It is not possible to obtain comprehensive information on how many leaseholders in flats have been able to acquire the freehold of their homes, as enfranchisement is a private transaction between the freeholder and leaseholders.

  Housing (Dudley)
  Mr. Pearson
  To ask the Secretary of State for the Environment how many new housing units were constructed by(a) the local authority and (b) housing associations in Dudley metropolitan borough area in each year since 1979. [580]

  Mr. Clappison
  Local authorities' primary housing tasks are now the efficient management of their own stock of housing and enabling other organisations to provide new housing. Housing associations are now the main providers of new social housing.

  The publications "Housebuilding in England by Local Authority Area: 1980 to 1989" and "Local Housing Statistics" show estimates of housebuilding completions for each local authority area in England, including the
  116
  Dudley metropolitan borough area. They show completions by sector, including activity by local authorities and housing associations.

  "Housebuilding in England by Local Authority Area: 1980 to 1989" shows figures for the period 1980 to 1984. "Local Housing Statistics" shows figures for 1979 and later years: issue 59 covers 1979; No. 103 covers the years 1985 to 1990; No. 105 covers 1991: No. 106 covers 1992; No. 110 covers 1993; and No. 114 covers 1994.

  Copies of these publications are in the Library.

  Clean Air Act 1993
  Mr. Lewis
  To ask the Secretary of State for the Environment what proposals he has to amend provisions contained in the Clean Air Act 1993. [130]

  Mr. Clappison
  As announced in "Cutting Red Tape", published in January 1994, the Government intend to repeal sections 4 to 13 of the Clean Air Act 1993–formerly contained in the Clean Air Acts 1956 and 1968. They are no longer necessary in the light of changes in fuel use and the provisions of the Environmental Protection Act 1990.

  Uranium, Caldecott
  Mr. Cohen
  To ask the Secretary of State for the Environment what information he has about the source of the uranium found on Poplar farm, Caldecott, Northamptonshire. [336]

  Mr. Clappison
  I have nothing further to add at this stage, to the answer that I gave to the hon. Member for Sunderland, South (Mr. Mullin) on 27 October 1995,Official Report, column 817.

  Contaminated Land
  Mr. Dafis
  To ask the Secretary of State for the Environment how much public money was spent on cleaning up contaminated land on inner-city development sites during 1994–95. [310]

  Mr. Clappison
  Public expenditure support for the redevelopment of inner-city and other sites—including, where necessary, the costs of dealing with contaminated soil—is made available under a number of different programmes. In England, these included in 1994–95 English Partnerships' investment fund, city challenge and urban programme; parallel arrangements exist in Wales and Scotland.

  Funding to meet the costs of land remediation typically constitutes only one element of a wider package of support for individual projects under these programmes. The various different cost elements are not separately identified in centrally collected records, and it is therefore not possible to provide a detailed breakdown in the form requested.

  Work-related Upper Limb Disorders
  Mr. Jim Cunningham
  To ask the Secretary of State for the Environment how many employees in(a) the public sector and (b) the private sector, have been diagnosed with work-related upper limb disorders during the years (i) 1992–93, (ii) 1993–94 and (iii) 1994–95. [1126]
  117
  Sir Paul Beresford
  Some types of work-related upper limb disorders are prescribed under the industrial injuries scheme. The number of cases in Great Britain diagnosed with at least 1 per cent. disability for the periods 1992–93 and 1993–94 are shown in the table:

  Disorders

  1992–93

  '1993–94

  Cramp of hand or forearm

  116

  135

  Beat hand

  16

  18

  Beat elbow

  38

  42

  Inflammation of tendons of the hand, forearm or associated tendon sheaths (Tenosynovitis)

  911

  800

  Carpal Tunnel Syndrome

  20

  267

  1 Provisional.

  Data broken down by private and public sectors are not collated in the form requested, and data for 1994–95 are not yet available.

  The industrial injuries statistics cover only the most serious cases from a restricted range of occupationally defined upper limb disorders. From a survey based on respondents' own perception of the link between their occupation and ill-health, it was estimated that in the 12 months prior to March 1990, 110,000 people in England and Wales suffered from an upper limb disorder which they believed was caused by their work. This estimate was based on responses to a special set of questions in the 1990 labour force survey and covers a wider range of upper limb disorders and degrees of severity than the industrial injuries scheme.

  Mr. Cunningham
  To ask the Secretary of State for the Environment how many employers have complied with the Health and Safety (Display Screen Equipment) Regulations 1992 in respect of the instructions to employers to(a) analyse VDU workstations, (b) assess the risks to health and (c) take action to reduce such risks; and how many employers have been prosecuted for not complying with the regulations. [1005]

  Sir Paul Beresford
  Information on the extent of compliance with the Health and Safety (Display Screen Equipment) Regulations 1992 is not available in the form requested. However, the Health and Safety Executive has started work to evaluate the impact of the regulations. This has included a survey of employers. This evaluation is due for completion in 1996 and should produce information on the extent of awareness of, and compliance with, the regulations, and what actions employers have taken to comply.

  The available figures for 1993–94 and 1994–95, provisional figures show that HSE's field operations division inspectors took no prosecution action under the display screen equipment regulations, but issued five improvement notices under these regulations. Equivalent figures are not available for local authority inspectors, who enforce health and safety regulations in premises such as offices, banks and shops.

  Public Interest Immunity Certificates
  Mr. Cohen
  To ask the Secretary of State for the Environment if he will list all those in his Department who have authority to issue public interest immunity certificates; how many such certificates have been 118
  issued in each of the last five years; and what were the main reasons for them. [1423]

  Sir Paul Beresford
  The Secretary of State for the Environment has not in the last five years produced or authorised the production of any public interest immunity certificates in any legal proceedings.

  Green Ministers
  Ms Ruddock
  To ask the Secretary of State for the Environment (1) what assessment he has made of the advantages of having(a) a junior minister and (b) a Secretary of State as a Green Minister; [242]

  (2) if he will publish the criteria used to select the Minister to be designated as the Green Minister within a Government Department; [240]

  (3) who is responsible for selecting the Green Minister within each Government Department. [241]

  Mr. Gummer
  Green Ministers are appointed by the senior Minister for each Department who will look for whoever may best fulfill the role and combine it with other duties. There are no fixed criteria, and the appropriate level in the team may vary. The responsibility of the Green Minister in each Department is to ensure that environmental considerations are integrated into the strategy and policies of that Department.

  Regional Planning Guidance (West Midlands)
  Ms Ruddock
  To ask the Secretary of State for the Environment (1) what procedures have been put in place by his Department to monitor the environmental impacts arising from the implementation of regional planning guidance for the west midlands. [252]

  (2) if regional planning guidance for the west midlands was (a) subject to and (b) modified on account of an environmental appraisal using the guidance contained in "Policy Appraisal and the Environment" produced by the Department of the Environment; and if he will publish the appraisal; [250]

  (3) what alternative courses of action from those detailed in regional planning guidance for the west midlands were considered in any environmental appraisal undertaken by his Department. [251]

  Mr. Robert B. Jones
  The regional planning guidance followed the principles set out in "Policy Appraisal and the Environment". During its three-year development, a number of alternative courses of action were considered and environmentally appraised. The west midlands local authorities held a conference at which a wide range of organisations expressed their views on a series of strategic planning options for the region. The authorities then submitted their advice to my Department and there was a period of consultation on that advice. My Department published draft regional planning guidance and again a period was allowed for consultation. The final guidance included numerous modifications to the original advice reflecting the view expressed by environmental organisations and others. I do not intend to publish a separate environmental appraisal in addition to the material already published.
  119
  We have asked the west midlands local authorities to keep the guidance under regular review in partnership with the Government office for the west midlands and others. Follow-up studies are required on particular aspects. The authorities' attention is particularly drawn to the aim of achieving a more sustainable pattern of development in the region.

  Invoices
  Mrs. Barbara Roche
  To ask the Secretary of State for the Environment (1) what is the average length of time it takes for his Department to pay invoices; [932]

  (2) how his Department publicises payment practices other than as percentages of invoices paid late; [956]

  (3) what is the amount owed to those businesses whose invoices were not paid within 30 days or within the agreed contractual arrangements in each of the last five years. [1119]

  Sir Paul Beresford
  The Department only holds central data on its performance in paying invoices within 30 days or the agreed credit period where this is different. It does not hold a central record of the amount owed to businesses not paid within the agreed period. This information could be provided only at disproportionate cost. The Department's payment practices are publicised in its terms and conditions of contract and its annual report.

  Water Conservation
  Ms Ruddock
  To ask the Secretary of State for the Environment (1) what alternative courses of action from those detailed in "Water Conservation: Government Action" were considered in any environmental appraisal undertaken by his Department; [248]

  (2) if "Water Conservation: Government Action" was (a) subject to, and (b) modified on account of, an environmental appraisal using the guidance contained in "Policy Appraisal and the Environment" produced by his Department; and if he will publish the appraisal; [247]

  (3) what procedures have been put in place by his Department to monitor the environmental impacts arising from the implementation of "Water Conservation: Government Action". [249]

  Mr. Clappison
  "Policy Appraisal and the Environment" sets out an approach whereby environmental effects can be taken into account in policy development, while recognising that this will vary from case to case depending on the complexity and significance of the impacts. "Water Conservation: Government Action" outlines the Government's policy for England and Wales on the various issues surrounding the conservation of water resources, including the proposed approach to the future method of charging for water. The Government's position is that, before additional resources are developed, existing resources should be used as far as possible, taking into account economic and environmental consideration.

  The general policy and the specific proposals were developed following widespread consultation. They are designed to reduce the potential environmental impact of increased demand for water by measures to promote its efficient distribution and use.
  120
  The effectiveness of the policy and the specific proposals will be monitored by the Department of the Environment, the Office of Water Services and the National Rivers Authority.

  Rural Policy
  Ms Ruddock
  To ask the Secretary of State for the Environment (1) if the White Paper "Rural England" (Cm 3016) was(a) subject to, and (b) modified on account of an environmental appraisal using the guidance contained in "Policy Appraisal and the Environment" produced by his Department; and if he will publish the appraisal; [300]

  (2) what alternative courses of action from those detailed in the White Paper "Rural England" (Cm 3016) were considered in any environmental appraisal undertaken by his Department; [301]

  (3) what procedures have been put in place by his Department to monitor the environmental impacts arising from the implementation of the White Paper "Rural England" (Cm 3016). [302]

  Mr. Clappison
  The rural White Paper "Rural England" sets out the Government's vision for the future of the countryside, looking at economic, social and environmental issues together. The White Paper was formulated in line with the Government's commitment to sustainable development.

  Environmental considerations are an essential element of policy considerations and will be taken into account in following up the commitments contained within the White Paper.

  Regional Staff
  Mr. Byers
  To ask the Secretary of State for the Environment how many staff his Department employs on a regional basis in each standard English region; what is the cost of running these regional operations; what was the total budget for each region in 1994–95; and what are the main purposes for which the budget is used. [266]

  Sir Paul Beresford
  Detailed information on Department of Environment staff employed in the Government offices for the regions, their budgets and activities is provided in GO-MINIS 1, copies of which were placed in the Library in July 1995.

  Biological Diversity
  Mr. Dalyell
  To ask the Secretary of State for the Environment if he will make a statement on the achievement of the meeting, referred to in his answer of 8 November 1995,Official Report, column 995, of the convention on biological diversity in Jakarta, 6 to 17 November in regard to the transfer of living modified organisms between countries. [1631]

  Mr. Clappison
  The second conference of the parties to the convention on biological diversity, held in Jakarta, Indonesia from 6 to 17 November 1995, decided to set in hand the development of a biosafety protocol which will specifically focus on the transboundary movement of living modified organisms. The conference also recognised the importance of the United Nations environment programme international technical guidelines
  121
  on safety in biotechnology as a possible interim measure during the development of the protocol and as a complement to it after its completion.

  Other important decisions included the acknowledgement of the importance of parties establishing national strategies and in-situ conservation measures, the establishment of a three-year scientific work programme on coastal and marine ecosystems, the establishment of a pilot phase of the clearing house mechanism to facilitate the sharing of information and the choice of Montreal as the location for the biodiversity convention secretariat.

  As last year, it was not possible to reach agreement on voting provisions on financial issues. These will be considered again at the third conference of the parties to be held in November 1996.

  Environmental Technology Industry
  Mr. Jim Cunningham
  To ask the Secretary of State for the Environment (1) what was(a) the total output and (b) the percentage of GNP of the United Kingdom environmental industry for each year since 1990–91; and if he will provide an estimate for the current financial year; [1163]

  (2) what assessment he has made of the growth in the last five years of the United Kingdom environmental technology industry in terms of (a) output, (b) percentage of GNP and (c) employment; [1165]

  (3) how many people in the United Kingdom are employed in the environmental technology industry; and how many people have been employed in that industry for each year since 1990. [1164]

  Mr. Ian Taylor
  I have been asked to reply.

  Information on the environmental technology and associated industries is very limited. Using a definition of the environmental products industries as producing
  "a product which enhances or prevents the deterioration of the external environment"
  information available suggests that the value added by the environmental products sector has increased strongly over the period from 1985 to 1991. In 1990 and 1991, there were approximately 110,000 people employed in the environmental products industries.

  The available information on this topic, which was derived by the Department's statisticians, has been published in "Statistical News; Summer 1995" and is available in the Library of the House. No further assessment has yet been made on the growth of this sector.

FOREIGN AND COMMONWEALTH AFFAIRS

  Ministerial Transport, London
  Mr. MacShane
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many times in the last year he used(a) the London Underground and (b) London Transport buses while on official business. [372]
  122
  Mr. Hanley
  My right hon. and learned Friend the Foreign Secretary uses public transport from time to time.

  Hydronuclear Experimental Tests
  Mr. Llew Smith
  To ask the Secretary of State for Foreign and Commonwealth Affairs what is Her Majesty's Government's policy in respect of whether hydronuclear experimental tests may be conducted within the terms of the proposed comprehensive nuclear test ban treaty. [1587]

  Mr. David Davis
  We are working to achieve a comprehensive test ban treaty which would prohibit all nuclear weapon tests explosions involving any release of nuclear energy.

  Iraq
  Mrs. Ewing
  To ask the Secretary of State for Foreign and Commonwealth Affairs what information he has on the number of prisoners from other nations currently being detained in Iraq and their countries of origin. [1588]

  Mr. Hanley
  We have no reliable figures on the total number of foreigners held in Iraqi gaols.

  Precise numbers of foreign prisoners are not given out by the Iraqi regime.

  Mrs. Ewing
  To ask the Secretary of State for Foreign and Commonwealth Affairs what communication he has had with Hussein Kamil in respect of Iraqi compliance with Security Council resolutions involving disclosure of information on prisoners of war. [1590]

  Mr. Hanley
  It would not be appropriate to comment on this matter. We continue to press the Iraqi authorities through every available means to disclose the fate of the detainees.

  Mrs. Ewing
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has made to the Iraqi Government concerning Kuwaiti prisoners of war still being held captive; and if he will make a statement. [1589]

  Mr. Hanley
  We take every opportunity at the UN and through the tripartite commission to press Iraq to co-operate. The November review of sanctions stressed that Iraq must comply with all its UN obligations including that on Kuwaiti detainees.

  Exports
  Dr. Lynne Jones
  To ask the Secretary of State for Foreign and Commonwealth Affairs if it is the practice of his Department to make an assessment of the loss of earnings by British exporters, excluding military equipment, which may be caused as a result of war or internal conflict. [1571]

  Mr. David Davis
  This Department, together with the Department of Trade and Industry, alerts British exporters to potential difficulties in repatriation of export earnings that may occur as a result of war or internal conflicts abroad. Further action is then a matter for the individual companies. We have no central figures for the total amount involved in loss of earnings as the result of such actions.
  123

  Caroline Beale
  Mr. Harry Cohen
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations his Department has made to the relevant United States authorities to ensure that the legal proceedings concerning Caroline Beale, or any decision on her future, are not unduly delayed; and if he will make a statement. [1150]

  Mr. Hanley
  Her Majesty's consul has pressed both the New York district attorney's office and the defence counsel for a decision in this case on many occasions, most recently on 13 November.

  Land Mines
  Dr. Lynne Jones
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will set out the criteria which will be used to determine non-detectable anti-personnel land mines. [1570]

  Mr. David Davis
  We are working to incorporate stringent specifications on the detectability of anti-personnel land mines into the 1981 United Nations weaponry convention. Specifically, we support a proposal from the International Committee of the Red Cross to the effect that:"Anti-personnel mines shall incorporate in their construction, or have attached, in a manner not easily removable, material or a device that enables the mine to be detected by commonly available technical mine detection equipment and provides a response signal equivalent to a signal from 8 grams, or more, of iron in a single coherent mass".

  Invoices
  Mrs. Roche
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many orders and firms are represented by the 13 per cent. of invoices not paid by his Department within 30 days or in accordance with contractual agreements in 1994–95; and how many of those related to firms with fewer than 500 employees. [1116]

  Mr. Hanley
  The 13 per cent. of payments not made by the Overseas Development Administration in 1994–95 within 30 days of receipt of a valid invoice or in accordance with contractual arrangements amounted to 3,328 payments out of a total number of 25,234. Separate figures for small firms are not available.

  Mrs. Roche
  To ask the Secretary of State for Foreign and Commonwealth Affairs how his Department publicises payment practices other than as percentages of invoices paid late. [957]

  Mr. Hanley
  The FCO, Diplomatic Wing and Overseas Development Administration, publishes payment performance, as a percentage of invoices paid on time, in the annual departmental report. The FCO, DW and ODA, is committed to the CBI prompt payment code, which includes a clause to the effect that properly supported invoices will be paid within 30 days of receipt. The ODA is introducing a payment advice slip which informs the payee of the ODA's commitment to the CBI prompt payment code and invites them to take up an query with the head of ODA's accounts department.

  Mrs. Roche
  To ask the Secretary of State for Foreign and Commonwealth Affairs what is the average length of time it takes for his Department to pay invoices. [931]
  124
  Mr. Hanley
  The FCO Diplomatic Wing has, since 1994, measured its payment performance using a random sample of invoices submitted throughout the year. An analysis of this sample shows that the average time taken to pay invoices is 20 days. The Overseas Development Administration takes an average of 10 days, the Wilton Park executive agency an average of 25 days and the Natural Resources Institute an average of 10 days.

  Ethiopia
  Mr. Cousins
  To ask the Secretary of State for Foreign and Commonwealth Affairs what support the United Kingdom Government are offering the Government of Ethiopia towards(a) the preparation of cases and (b) the setting up of courts and procedures to hear cases of human rights abuses under the former Derg regime. [530]

  Mr. Hanley
  Along with other members of the international community, we have given certain office equipment to the special prosecutor's office for the preparation of human rights trials involving members of the Derg regime.

  Nigeria
  Mr. Tony Lloyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the meeting between the Prime Minister and Chief Shonekan, a representative of the Nigerian military regime, on 21 September. [1209]

  Mr. Hanley
  [holding answer 21 November 1995]: My right hon. Friend the Prime Minister saw Chief Shonekan on 21 September to receive a message from General Abacha. My right hon. Friend pressed first the case for clemency for General Obasanjo and the alleged coup plotters who were at that time under sentence of death; and second for rapid progress towards civilian democratic rule in Nigeria. As a prominent businessman, Chief Shonekan was not affected by EU visa restrictions on Nigeria, which applied at that time only to military personnel and their families.

SOCIAL SECURITY

  Students
  Mr. Bryan Davies
  To ask the Secretary of State for Social Security what is his Department's estimate of the public expenditure savings which will result from the decision not to allow students who have temporarily suspended their studies to claim social security benefit. [982]

  Mr. Roger Evans
  The information is not available. In general, it is the educational maintenance system which is designed to provide support for students, not the social security system. Amendment regulations were laid before the House on 10 July to restore the original policy intention regarding students who temporarily suspend their studies, following a Court of Appeal decision. The regulations were not amended in isolation. The Department for Education and Employment has recently issued revised and expanded guidance to all local education authorities about their discretionary powers to continue to pay mandatory awards to students during periods of temporary absence.
  125

  Incapacity Benefit
  Mr. McMaster
  To ask the Secretary of State for Social Security how many people have failed the test of incapacity but have scored(a) between one and five points, (b) between six and nine points and (c) 10 points and over. [572]

  Mr. Burt
  The information could be obtained only at disproportionate cost.

  Mr. McMaster
  To ask the Secretary of State for Social Security how many claimants of incapacity benefit are currently exempt from all the work test of incapacity; how many of these(a) were previously entitled to invalidity benefit and (b) are claimants of the new incapacity benefit claimants; and if he will make a statement. [1102]

  Mr. Burt
  The information is not available in the format requested. Of those considered for the all-work test in the period April to October 1995, a total of 159,804 people1 have been found to be exempt. This is made up of 138,828 suffering from a severe medical condition and 20,976 in receipt of the higher rate care component of disability living allowance.

  Notes:

  1 This figure excludes Incapacity Benefit claimants who are also in receipt of Widow's Benefit as this information is not currently available.

  Giro Cheques
  Ms Lynne
  To ask the Secretary of State for Social Security how many giro benefit cheques have been recorded lost in each year since 1979. [371]

  Mr. Heald
  The information is not available in the format requested. Figures are available to show the numbers of requests received by Girobank for giro cheques which have been cashed, to be returned to benefit offices. These requests will be made for a number of reasons:

  1. A Giro cheque has been reported as not received, stolen, lost etc., and is required for investigation purposes.

  2. The customer has denied or queried the receipt of the Giro cheque.

  3. The customer has queried the amount shown on the Giro cheque.

  These statistics are only available from 1992–93 and are as follows:

  1992–93: 697,954

  1993–94: 493,113

  1994–95: 444,054

  In 1994–95, 82.9 million giro cheques were issued by the Benefits Agency and the Employment Service.

  Income Support
  Mr. French
  To ask the Secretary of State for Social Security how many people aged under 19 years and in non-advanced education are currently claiming income support on account of their being estranged from their parents. [173]

  Mr. Roger Evans
  This information is not available.
  126

  Mortgage Interest
  Mr. Raynsford
  To ask the Secretary of State for Social Security what is his latest estimate of the total number of claimants receiving income support towards mortgage interest in 1995, the average amount of each payment and the total cost of all such payments. [313]

  Mr. Roger Evans
  On the basis of the November 1994 quarterly statistical inquiry, the latest available data, it is estimated that the total number of claimants receiving income support help towards mortgage interest is 510,000, the average weekly award is £36.66 and the total annual cost is £973 million.

  Industrial Injuries
  Mr. Tipping
  To ask the Secretary of State for Social Security what plans he has to make hand and arm vibration syndrome a prescribed industrial disease. [1063]

  Mr. Roger Evans
  We are currently considering the recommendations made by the Industrial Injuries Advisory Council in its report "Hand Arm Vibration Syndrome", Cm 2844.

  Staffing
  Mr. Byers
  To ask the Secretary of State for Social Security how many staff his Department employs on a regional basis in each standard English region; what is the cost of running these regional operations; what was the total budget for each region in 1994–95; and what are the main purposes for which the budget is used. [263]

  Mr. Burt
  The information is not available in the format requested and could be obtained only at disproportionate cost. Such information as is available is in the table:

  Region

  Number of staff employed by the Department including its Executive Agencies as at 1 October 1995

  North

  16,347

  Yorks and Humberside

  7,592

  North west

  20,795

  East Midlands

  4,069

  West Midlands

  7,071

  East Anglia

  1,748

  South east

  19,147

  South west

  5,092

  The table excludes:

  1. Staff on loan or secondment and not being paid by the Department.

  2. Staff on unpaid leave for more than three months or on unpaid maternity leave; and

  3. Casual staff.

  Invalid Care Allowance
  Mr. Steinberg
  To ask the Secretary of State for Social Security how many children with the metabolic disease phenylketonuria have been awarded invalid care allowance; how much has been spent by Her Majesty's Government on appeals after which they have turned down the original application; how many applications have been refused; and for what reasons the refunds were made. [154]
  127
  Mr. Burt
  Invalid care allowance is available to people who provide care for severely disabled people. The disability causing the person to require care is not recorded centrally and the information asked for could be obtained only at disproportionate cost.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for Social Security how his Department publicises payment practices other than as percentages of invoices paid late. [967]

  Mr. Burt
  There is a statutory agreement with the Public Accounts Committee to publish the results of the annual payment of bills exercise in its present format—expressed as percentages of invoices paid timeously.

  Mrs. Roche
  To ask the Secretary of State for Social Security what is the average length of time it takes for his Department to pay invoices. [922]

  Mr. Burt
  The information is not available in the format requested.

  Our aim is that all such bills should be paid within any special terms agreed, or if none exist within 30 days of receipt of the goods or service, or 30 days of receipt of a valid invoice, whichever of these is the later. Our latest monitoring exercise of the timeous payment of bills show that to date we are achieving 96 per cent. payment on time.

  Mrs. Roche
  To ask the Secretary of State for Social Security what is the amount owed to those businesses whose invoices were not paid within 30 days or in accordance with special terms agreed in each of the last five years. [1124]

  Mr. Burt
  Information is not available for the financial years 1990–91 and 1991–92. For 1992–93 and 1993–94 information could be obtained only at disproportionate cost. Details for the financial year 1994–95 and 1995–96 to 31 October are in the table.

  Agency

  1994–95

  1995–96 to 31 October

  DSS Headquarters

  179,810.00

  385,221.00

  Benefits Agency

  248,143.47

  62,526.36

  Resettlement Agency

  1,872.87

  1,948.86

  War Pensions Agency

  1,373.02

  23,781.77

  Child Support Agency

  185,583.32

  53,773.75

  Information Technology Services Agency

  24,899.67

  1,255.20

  Contributions Agency

  1,298,024.38

  47,178.46

  Mrs. Roche
  To ask the Secretary of State for Social Security how many (i) orders and (ii) firms are represented by the 10.5 per cent. of invoices not paid by his Department within 30 days or in accordance with contractual agreements in 1994–95; and how many of those are related to firms with fewer than 500 employees. [915]

  Mr. Burt
  The information is not available in the format requested.
  128
  The number of firms represented by the 10.5 per cent. of invoices not paid by DSS headquarters within 30 days or in accordance with contractual agreements in 1994–95 is 33.

  The method of recording suppliers and payments does not allow for differentiation categories of suppliers with fewer than 500 employees.

  Living Standards
  Mrs. Beckett
  To ask the Secretary of State for Social Security in which year since 1965 the living standards of each decile of high to low income population were half their present level; and in which such year average living standards were half their present level. [1518]

  Mr. Andrew Mitchell
  The available information relates to income as measured in "Households Below Average Income"; this is "equivalent" income—household income adjusted for household size and composition. The DSS series runs from 1979; the Institute for Fiscal Studies has extended it back to the 1960s. This shows that incomes in the top decile doubled between 1965 and 1992–93. Average equivalent income as measured in HBAI, and incomes in other deciles, did not double within this period. The HBAI measure has weaknesses as a guide to living standards, especially at the bottom of the income distribution.

HEALTH

  NHS Capital Investment
  Mr. Pearson
  To ask the Secretary of State for Health if he will make a statement on procedures for, and stages of, public consultation in relation to NHS capital investment plans which involve transfer of services and closure of hospitals. [582]

  Mr. Sackville
  Health authorities are expected to consult local people and statutory and voluntary agencies in drawing up their annual purchasing plans and longer-term strategies. Health authorities also have a statutory responsibility to consult community health councils on any proposals for substantial changes in service provision. Where a community health council contests a proposal to close or change the use of a hospital the matter is referred to the regional health authority. If the regional health authority supports the proposal, it is referred to Ministers to make a decision.

  NHS Staff
  Mr. Hugh Bayley
  To ask the Secretary of State for Health how many vacant posts for(a) consultants and (b) other medical staff there were in English NHS trusts in each region on (i) 15 April 1994 and (ii) at the latest date for which figures are available in (1) psychiatry, (2) accident and emergency, (3) geriatric medicine, (4) general surgery, (5) anaesthetics, (6) general medicine and (7) obstetrics and gynaecology. [542]

  Mr. Malone
  This information is not available centrally.
  129
  Mr. Cohen
  To ask the Secretary of State for Health what plans he has to introduce a system of assessment for(a) consultants and (b) general practitioners; and if he will make a statement. [326]

  Mr. Malone
  The report, "Maintaining Medical Excellence", made a number of recommendations to ensure that standards of professional performance are maintained at a higher level. For hospital doctors, it recommended that employers and professional bodies should explore the feasibility, costs and benefits of mentoring systems and report back. For general practitioners, it recommended that for regulatory purposes systems of objective assessment against a national framework should be introduced into vocational training, subject to satisfactory costing.

  The report was issued for consultation in August and we are awaiting the outcome of the consultation exercise, which ends on 29 December 1995.

  NHS Treatment Costs
  Mr. Pawsey
  To ask the Secretary of State for Health if he will list the reasons for not making patients aware of the cost of their individual treatment. [1097]

  Mr. Malone
  Present costing systems within the national health service are intended to provide accurate estimates of total costs involved in providing a service at a pre-determined level of activity. This system enables average treatment costs to be produced, and it is these figures that are used in the price lists for extra contractual referrals. The price lists are available to the public. The additional costing work necessary to produce individual patient treatment costs would not represent best use of NHS resources.

  "Mental Health and Stress in the Work Place"
  Mr. Cohen
  To ask the Secretary of State for Health when he expects to publish the pamphlet, "Mental Health and Stress in the Work Place", which he commissioned; what factors underlay the timing of publication; what were its main recommendations; and if he will make a statement. [327]

  Mr. Bowis
  The booklet "Mental Health and Stress in the Work Place" is not, and was never intended to be, a Department of Health publication. I understand that the document will be published in due course. It would not be appropriate for me to comment on its content prior to publication.

  Mentally Ill Homeless People
  Mr. Cohen
  To ask the Secretary of State for Health what action he has taken, and what money he has allocated for(a) key teams of care workers to make contact with mentally ill homeless people, (b) specialist hostels and (c) provision of permanent homes with care following the homeless mentally ill initiative; and if he will make a statement. [325]

  Mr. Bowis
  Over £20 million has been allocated to the homeless mentally ill initiative since it was launched in 1990. This has covered the capital costs of 10 short-stay hostels providing nearly 150 bed spaces. The long-term revenue costs of these high-care bed spaces are met from the mental illness specific grant; costs are currently 130
  £15,500 per annum per bed space for the first three years, tapering to £7,750. This funding will continue for the foreseeable future. The Housing Corporation has committed £9.5 million to the provision of 181 units of move-on accommodation. Funding for five multi-disciplinary community psychiatric outreach teams is built into the annual allocations to regional health authorities.

  Cardiac Services
  Mr. Cohen
  To ask the Secretary of State for Health which health authorities in London do not have the necessary technical equipment in their locality to undertake(a) permanent pacemaker implantations and (b) cardiac catheterisation; when he estimates they will all be able to provide these operations; and if he will make a statement. [339]

  Mr. Sackville
  This information is not available centrally.

  Khat
  Mr. Tim Rathbone
  To ask the Secretary of State for Health, what review is being made of the harmful health effects of khat; and what plans are being made for banning it in the United Kingdom. [311]

  Mr. Bowis
  The Department of Health continues to monitor the misuse of khat. Khat is not subject to control under the international United Nation drug treaties and we have no plans at present to schedule it under the Misuse of Drugs Act 1971. The key criterion in the 1971 Act is whether the misuse of a substance has or is capable of having harmful effects sufficient to constitute a social problem.

  The Advisory Council on the Misuse of Drugs considered the misuse of khat in 1988 against this criterion and reached the view that bringing it within the 1971 Act's controls would not be appropriate.

  We are keeping the matter under review.

  File WOP/4/5
  Mr. Redmond
  To ask the Secretary of State for Health on what date and where his Department's file WOP/4/5 that was mislaid in 1981 was discovered; what was the cause of it being mislaid; and if he will make a statement. [55]

  Mr. Sackville
  The file was found on 4 August 1995 among closed files retained for reference. The file had been closed in 1990, but this had not been noted.

  Embryo Eggs
  Mr. Morley
  To ask the Secretary of State for Health what action his Department is taking in respect of(a) the commercial selling of embryo eggs and (b) gender clinics. [1020]

  Mr. Sackville
  The Human Fertilisation and Embryology Authority is reviewing its policy on the payment of egg and sperm donors and will examine any claim that a licensed clinic is acting improperly. In the light of this review, the Government will consider whether any action needs to be taken.
  131
  The HFEA has advised all centres which it licenses for infertility treatment that sex selection for social reasons is not acceptable. Sperm separation techniques used in gender clinics offering sex selection for social reasons are considered to have no scientific basis.

  Bradford Hospitals NHS Trust
  Mr. Redmond
  To ask the Secretary of State for Health if he will carry out an investigation in conjunction with the Bradford Royal Infirmary NHS trust into the(a) age, (b) ethnic background and (c) mental state for the female patient who had stitches to a wound carried out by a 16-year-old work experience trainee; and if he will make a statement. [62]

  Mr. Sackville
  This is a matter for Bradford Hospitals National Health Service trust. The hon. Member may wish to contact Rodney Walker, chairman of the trust for details.

  Community Health Councils
  Mr. Bayley
  To ask the Secretary of State for Health what guidance has been given by his Department to regional offices on the future funding status and remit of community health councils. [320]

  Mr. Malone
  Following consultation on the report of the NHS executive's working group on the future establishing arrangements for community health councils, we intend to issue revised guidance shortly.

  NHS Treatment Entitlement
  Mr. Pawsey
  To ask the Secretary of State for Health if he will list the procedures that are in place and identify and charge patients who are not eligible for free NHS treatment and the mechanism used to ensure that the procedures are in place and followed. [1096]

  Mr. Sackville
  The procedures to identify and charge patients who are not eligible for free national health service treatment are found in the manual of guidance for the NHS treatment of overseas visitors, copies of which are available in the Library.

  The Department liaises regularly with NHS officials who have immediate responsibility for enforcing the procedures.

  Emergency Admissions
  Mr. Bayley
  To ask the Secretary of State for Health what research his Department has commissioned into changes in numbers of accident and emergency admissions and surgical emergency admissions; and if he will place in the Library copies of guidance issued to health authorities or regions about funding these types of admissions in(a) the current year and (b) future years. [322]

  Mr. Sackville
  My Department has not commissioned research into changes in the numbers of accident and emergency and surgical emergency admissions; nor has it issued guidance on funding these admissions.
  132

  Osteopaths Act 1993
  Mr. Gordon Prentice
  To ask the Secretary of State for Health for what reasons the Osteopaths Act 1993 has not fully been brought into force; and when he intends to fully bring it into force. [198]

  Mr. Sackville
  We expect to announce the membership of the General Osteopathic Council shortly. The Osteopaths Act will be brought into force in stages according to the programme the Council develops for implementing the statutory scheme.

  Residential Accommodation
  Mr. Jim Cunningham
  To ask the Secretary of State for Health (1) how many people, since the National Health Service and Community Care Act 1990, are known to have deliberately deprived themselves by transferring their assets; and what action was taken against them under section 21 of the Health and Social Services and Social Security Adjudication Act 1983; [1129]

  (2) what plans he has to strengthen the law with respect to the deliberate transfer of assets. [1130]

  Mr. Bowis
  Information on numbers of people who have deliberately deprived themselves of assets for the purposes of reducing their contribution towards the cost of residential accommodation, and any action taken against them under section 21 of the Health and Social Services and Social Security Adjudication Act is not available centrally.

  The legislation relating to charging for residential accommodation, including the deprivation of assets, is kept under constant review.

  Mr. Cunningham
  To ask the Secretary of State for Health if he will make a statement clarifying the role of the state and the individual in paying for long-term care; and if he will make that information widely available to the elderly. [1134]

  Mr. Bowis
  The role of the state and the individual in paying for residential care is as laid down by the Government of 1948 in their National Assistance Act.

  Hospital Admissions
  Mr. Cohen
  To ask the Secretary of State for Health what measure he proposes to take to ensure that the national health service can cope with an above-average demand for hospital admission; and if he will make a statement. [1153]

  Mr. Sackville
  Planning for fluctuating levels of hospital admission is a routine task for health authorities and hospitals, taking into account previous experience and local circumstances.

  "The Health of the Nation"
  Ms Ruddock
  To ask the Secretary of State for Health what procedures have been put in place by his Department to monitor the environmental impacts arising from the implementation of "The Health of the Nation" [258]

  Mr. Sackville
  "The Health of the Nation" is a Government strategy. It is subject to environmental monitoring and appraisal in the same way as other Government policies.
  133
  Ms Ruddock
  To ask the Secretary of State for Health if (1) "The Health of the Nation" Cm 1523, was(a) subject to and (b) modified on account of environmental appraisal using the guidance contained in policy appraisal and the environment produced by the Department of the Environment; and if he will publish the appraisal; [256]

  (2) what alternative courses of action from those detailed in "The Health of the Nation" were considered in any environmental appraisal undertaken by his Department. [257]

  Mr. Sackville
  "The Health of the Nation" is a Government strategy agreed after widespread consultation. My right hon. Friend the Secretary of State for the Environment was fully involved in that consultation and is a member of the Cabinet sub-committee which oversees development and monitoring of the strategy. Healthy environments are one of the "healthy settings" which "The Health of the Nation" recognises as being important to public health. The Government's policy on environmental matters is described in the Environment White Paper, "This Common Inheritance" and the sustainable development strategy.

  Staffing
  Mr. Byers
  To ask the Secretary of State for Health how many staff his Department employs on a regional basis in each standard English region; what is the cost of running these regional operations; what was the total budget for each region in 1994–95; and what are the main purposes for which the budget is used. [265]

  Mr. Sackville
  The information requested on staff employed in each of the standard English regions is shown in the table.

  Information about departmental running costs by region is not available. Details of the Department's gross running costs are provided in the Department's annual report for 1994–95, Cm 2512.

  Region

  Northern

  16

  Yorkshire and Humberside

  929

  North west

  637

  East Midlands

  62

  West Midlands

  108

  East Anglia

  0

  South east

  2,822

  South west

  21

  Source:

  1. MANDATE returns to Treasury from Chessington Computer Centre and Departmental records both as at 1 July 1995.

  2. Figures include inward loans and secondments, fixed term appointments, casuals and staff in Agencies.

  3. Figures exclude industrial staff and outwards loans and secondments.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for Health what is the average length of time that it takes his Department to pay invoices. [930]
  134
  Mr. Sackville
  The latest available information shows that the average time in 1994–95 was 16 days.

  Mrs. Roche
  To ask the Secretary of State for Health (1) what is the amount owed to those businesses whose invoices were not paid within the agreed credit period or within 30 days in each of the last five years; [1068]

  (2) how many orders and firms are represented by the 8.1 per cent. of invoices not paid by his Department within 30 days or in accordance with contractual agreements in 1994–95; and how many of those are related to firms with fewer than 500 employees. [917]

  Mr. Sackville
  The information is not available and could be provided only at disproportionate cost.

  Mrs. Roche
  To ask the Secretary of State for Health how his Department publicises payment practices other than as percentages of invoices paid late. [958]

  Mr. Sackville
  The Department's policy, which will be published in the Departmental annual report, is to make payment to suppliers within the time limits agreed and specified in contracts with them. This will normally be within 30 days. Where appropriate, departmental contracts also require contractors to make payment to sub-contractors within 30 days of receipt of an invoice.

  Population Statistics
  Mrs. Ann Winterton
  To ask the Secretary of State for Health what percentage of the population is(a) white European, (b) Asian, (c) black and (d) other ethnic minorities. [113]

  Mr. Sackville
  The latest available information from the labour force survey is shown in the table:

  Ethnic group

  Estimated percentage of private household population of Great Britain during period June 1994 to May 1995

  White

  194.2

  Asian

  3.4

  Black

  1.7

  Other groups

  0.6

  Total

  2100.0

  1 All but 0.5 per cent, of people in the White group are estimated to have European Nationality (Including Turkey and nations from the former USSR).

  2 Percentages do not sum exactly to 100.0 because of rounding.

  Public Interest Immunity Certificates
  Mr. Cohen
  To ask the Secretary of State for Health if he will list all those in his Department who have authority to issue public interest immunity certificates; how many such certificates have been issued in each of the last five years; and what were the main reasons for them. [1433]

  Mr. Sackville
  A claim to public interest immunity relating to departmental documents or information is normally made by the appropriate Minister.

  I refer the hon. Member to the replies I gave the right hon. Member for Derby, South (Mrs. Beckett) on 19 July Official Report, column 1286 and on 24 October, Official Report, column 571.
  135

  Vitamins
  Mr. Harry Cohen
  To ask the Secretary of State for Health what plans he has to fortify cereal grain flour in accordance with recommendations of the Medical Research Council vitamin study; and if he will make a statement. [334]

  Mrs. Browning
  I have been asked to reply.

  The Medical Research Council vitamin study research group on the prevention of neural tube defects made no recommendations on the fortification of foods. An expert advisory group was, however, convened to consider the dietary implications of the results of the MRC study. Its report recommended inter alia that the range of breads and breakfast cereals fortified with folic acid should be increased; that fortification with folic acid should be limited to breads and breakfast cereals; and that there should continue to be available a choice of unfortified breads and breakfast cereals. There was no recommendation to fortify flour. In response to the report the Government have encouraged the food industry to increase the range of breads and breakfast cereals fortified with folic acid on a voluntary basis. It is estimated that last year 50 to 60 per cent. of breakfast cereals and about 10 per cent. of breads were fortified with folic acid.

DUCHY OF LANCASTER

  Ministerial Transport, London
  Mr. MacShane
  To ask the Chancellor of the Duchy of Lancaster how many times in the last year he has used(a) London Transport buses and (b) London Underground while on official business; [405]

  Mr. MacShane
  To ask the Minister without portfolio how many times in the last year he has used(a) London Transport buses and (b) London Underground while on official business. [399]

  Mr. Roger Freeman
  None.

  Energy Consumption
  Mr. Battle
  To ask the Deputy Prime Minister what progress has been made towards cutting energy consumption in Government buildings for which he has responsibility, in each year since 1990. [1453]

  Mr. Freeman
  I refer the hon. Member to the reply given by my right hon. Friend the Secretary of State for the Environment to my hon. Friend the Member for Surrey, East (Mr. Ainsworth) on Wednesday 17 May 1995 Official Report, column 260.

  Invoices
  Mrs. Roche
  To ask the Chancellor of the Duchy of Lancaster what is the average length of time it takes for his Department to pay invoices. [936]

  Mr. Freeman
  The average length of time taken by my Department to pay invoices is 27 days.

  Mrs. Roche
  To ask the Chancellor of the Duchy of Lancaster how his Department publicises payment practices other than as percentages of invoices paid late. [954]
  136
  Mr. Freeman
  In accordance with the Government's undertaking given in the 1994 competitiveness White Paper, my Department sets out its payment policy in its annual report, Cm 2820, together with payment performance statistics expressed as a percentage of invoices paid. It is not intended to change the method by which performance is measured.

  Mrs. Roche
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the pilot project for a single licensing point for small businesses. [945]

  Mr. Freeman
  A study into a computer-based, one-stop system to provide new businesses with customised information about their regulatory and licensing requirements was announced on 8 August 1995. The study, which is being undertaken by KPMG Management Consulting, is due to be completed by the end of this year. Following the study, the intention is to undertake a pilot scheme in some selected business links covering starting up as a vehicle component manufacturer, a corner shop, a small hotelier and a small builder. Depending on the outcome of the pilot the Government, will consider the case for extending the system to other sectors of business and all areas of the country.

  Deregulation
  Mrs. Beckett
  To ask the Deputy Prime Minister what have been(a) the staffing costs and (b) other running costs of the administrative support to the deregulation unit; and what future expenditure has been estimated. [1650]

  Mr. Freeman
  The total staffing costs and other running costs of the deregulation unit are as follows:

  £ thousands

  1994–95 Outturn

  1995–96 Budget

  Staffing costs

  1,038

  1,171

  Other running costs

  193

  194

  The 1995–96 budget was set before the unit's transfer to the Cabinet Office from the Department of Trade and Industry in July 1995.

  Mrs. Beckett
  To ask the Deputy Prime Minister what has been the total amount expended on travel and subsistence expenses in respect of the deregulation task force so far; and what future expenditure has been estimated. [1651]

  Mr. Freeman
  The total amount of expenditure on travel and subsistence in respect of the deregulation task force since it was set up in July 1994 to 31 October 1995 is £8,564. Future expenditure is expected to be at similar levels.

  Mrs. Beckett
  To ask the Deputy Prime Minister if he will list the members of the deregulation task force indicating the factors underlying the recruitment of each member. [1652]

  Mr. Freeman
  There are 16 member of the deregulation task force, which is chaired by the right hon. Francis Maude of Morgan Stanley Ltd.
  137
  The other members are: David Band (Barclays de Zoete Wedd); David Campbell (Laporte Fine Organics Ltd.); Maurice Denyer (Fowler Bros (Cowfold) Ltd.); Michael Fallon (Quality Care Homes plc); Mike Fisher (Whale Tankers Ltd.) George Goring (The Goring Hotel); Teresa Graham (Baker Tilly); Janet Morgan (Sainsbury Family Charitable Trusts); Archie Norman (Asda Group plc); Timothy Parker (Kenwood Appliances plc); David Parry (formerly BP); Tony Rammelt (Regis Europe Ltd.); Roger Singleton (Barnardo's); Dan Wright (Albion Automotive Ltd.) and Peter Wyman (Coopers and Lybrand).

  Members have been drawn from across a wide range of industries, and from the voluntary sector. They have been appointed for the personal contribution they can make to the deregulation initiative and to the work of the task force.

  Invoices
  Mrs. Roche
  To ask the Deputy Prime Minister what is the average length of time it takes for his Department to pay invoices. [937]

  The Deputy Prime Minister
  I refer the hon. Member to the reply given by my right hon. Friend the Chancellor of the Duchy of Lancaster today.

  Mrs. Roche
  To ask the Deputy Prime Minister how his Department publicises payment practices other than as percentages of invoices paid late. [953]

  The Deputy Prime Minister
  I refer the hon. Member to the reply given by my right hon. Friend the Chancellor of the Duchy of Lancaster today.

TRANSPORT

  British Rail
  Ms Glenda Jackson
  To ask the Secretary of State for Transport how many staff have left British Rail since January 1993 under redundancy or early retirement arrangements; and what has been the total cost of payments made to staff leaving the industry. [283]

  Mr. Watts
  I understand that 24,364 staff have left British Rail under voluntary redundancy or early retirement arrangements, at a cost of £471.4 million. There have been no compulsory redundancies. In this time, BR has made significant efficiency improvements, bringing benefits to farepayers and taxpayers.

  Mr. Chris Davies
  To ask the Secretary of State for Transport (1) how many British Rail locomotives are currently being stored out of use as surplus to requirements or to the cannibalised for spare parts; how many have been offered for sale to operators or potential operators in(a) Britain and (b) overseas; and how many are available for sale; [182]

  (2) if he will take steps to require British Rail to make surplus locomotives and wagons available for sale to private operators. [408]

  Mr. Watts
  The information requested is not held centrally and could be obtained only at disproportionate cost.
  138
  In relation to passenger services, vehicles currently in store represent a small percentage of the total fleet; nevertheless it is for the three rolling stock leasing companies to decide when and on what terms these vehicles are offered for sale. Other than when the vehicles are being cannibalised for spare parts, the franchising director must be informed in advance of the disposal and be given an opportunity to bid.

  As for vehicles used for freight services, where equipment has no current or potential use, it should be offered for competitive sale. It is for British Rail to determine whether or not equipment is surplus to requirements.

  Ms Jackson
  To ask the Secretary of State for Transport what estimates were given to him by British Rail for its costs arising from the restructuring of British Rail for rail privatisation in(a) the current financial year and (b) the forthcoming financial year. [289]

  Mr. Watts
  British Rail estimates its costs linked to privatisation for the period 1 April 1995 to 30 September 1995 to be £44 million. No estimate has been received for the second half of 1995–96 or for 1996–97.

  London Transport Property
  Ms Glenda Jackson
  To ask the Secretary of State for Transport what is the estimated book value of all assets owned by London Transport Property for each of the years 1979 to 1995. [274]

  Mr. Norris
  London Transport Property is a division of London Transport and does not itself own property assets but, as agent, manages the property portfolios of LT and its subsidiaries. Information is not available in the form requested, but London Transport's annual report and accounts, copies of which are available in the Library, give information for each year on the value of assets, including property, owned or occupied by LT or its subsidiaries.

  Ms Jackson
  To ask the Secretary of State for Transport what was the gross sales revenue received by London Transport Property for each of the years 1979 to 1995. [275]

  Mr. Norris
  London Transport's property revenue for these years is shown in its annual report and accounts, copies of which are available in the Library.

  Environmental Pollution
  Ms Glenda Jackson
  To ask the Secretary of State for Transport if he will list those recommendations of the Royal Commission on environmental pollution his Department(a) has implemented, (b) plans to have implemented within the next 12 months, (c) plans to have implemented within the next 24 months, (d) plans to have implemented by 2000 and (e) has no plans to implement. [278]

  Sir George Young
  We have asked for views on the Royal Commission report as part of the national debate on transport policy.
  139

  "Transport: The Way Ahead"
  Ms Glenda Jackson
  To ask the Secretary of State for Transport when he intends to publish the findings of his "Transport: The Way Ahead" consultation. [297]

  Sir George Young
  A further report drawing together the threads of the transport debate will be published when my colleagues and I have considered the responses to "Transport: The Way Ahead".

  Ms Jackson
  To ask the Secretary of State for Transport if he will list those policies he has so far implemented as a result of his "Transport: The Way Ahead" consultation. [296]

  Sir George Young
  It would be premature to announce results from the discussions of "Transport: The Way Ahead" before my colleagues and I have properly considered the responses made to us.

  Ms Jackson
  To ask the Secretary of State for Transport if he will list the number of responses he has received to his "Transport: The Way Ahead" Consultation. [279]

  Sir George Young
  We have so far received about 200 written responses, many of which represent the collected views of a range of different people. In addition, we have received reports from a number of seminars which have been held around the country, at which various groups were represented. Further written responses and seminar reports are expected.

  Railtrack
  Ms Jackson
  To ask the Secretary of State for Transport how many staff have left Railtrack Group plc since January 1993 under redundancy or early retirement arrangements; and what has been the total cost of payments made to staff leaving the industry. [280]

  Mr. Watts
  Railtrack was formally vested with operating assets, including staff, on 31 March 1994. Since that date, some 463 staff have left the company, at a cost of £11,050,000 in severance costs.

  Ms Jackson
  To ask the Secretary of State for Transport what has been the total remuneration paid by his Department to(a) the chairman of Railtrack Group plc, (b) the chief executive of Railtrack Group plc, (c) the finance director of Railtrack Group plc, (d) the director of safety and standards of Railtrack Group plc, (e) the director of engineering and production of Railtrack Group plc and (f) the commercial director of Railtrack Group plc. [277]

  Mr. Watts
  None. Directors of the Railtrack Group plc board are paid by the company.

  Ms Jackson
  To ask the Secretary of State for Transport what funds his Department has spent on advice from consultants, outside organisations and individuals on the recruitment of(a) the chairman of Railtrack Group plc, (b) the chief executive of Railtrack Group plc, (c) the finance director of Railtrack Group plc, (d) the director of safety and standards of Railtrack Group plc, (e) the director of engineering and production of Railtrack Group plc and (f) the commercial director of Railtrack Group plc. [276]

  Mr. Watts
  None.
  140

  Accidents (Greater London)
  Ms Glenda Jackson
  To ask the Secretary of State for Transport if he will list the number of(a) road accidents involving heavy goods vehicles within the Greater London area for each of the following years, (b) serious injuries resulting from those accidents and (c) fatalities in each year from 1991 to 1995. [271]

  Mr. Norris
  The information request is shown in the following table.

  Injury road accidents in Greater London involving HGVs

  1991

  1992

  1993

  1994

  No Accidents

  1,184

  1,048

  1,078

  1,118

  Fatalities

  35

  38

  38

  36

  Serious Injuries

  242

  237

  192

  221

  Trunk Roads
  Ms Ruddock
  To ask the Secretary of State for Transport (1) if the "Trunk Roads in England—1994 Review" was(a) subject to, and (b) modified on account of, an environmental appraisal using the guidance contained in "Policy Appraisal and the Environment", produced by the Department of the Environment; and if he will publish the appraisal; [259]

  (2) what alternative courses of action from those detailed in the "Trunk Roads in England—1994 Review" were considered in any environmental appraisal undertaken by his Department. [260]

  Mr. Watts
  The 1994 review involved a reassessment of priorities within the roads programme rather than the adoption of a new policy. As explained in paragraph 4.5 of "Trunk Roads in England—1994 Review", each scheme's likely effects on the environment were taken into account during the review. A number of schemes were withdrawn because they could not achieve an acceptable environmental balance.

  Ms Ruddock
  To ask the Secretary of State for Transport what procedures have been put in place by his Department to monitor the environmental impacts arising from the implementation of the "Trunk Roads in England—1994 Review". [261]

  Mr. Watts
  The environmental impacts of each scheme in the national roads programme are assessed and considered carefully before a decision is taken to proceed.

  Ms Glenda Jackson
  To ask the Secretary of State for Transport what funding his Department has provided for maintenance of the trunk roads network within the Greater London area in each of the years from 1991 to 1995. [273]

  Mr. Norris
  I have asked the chief executive of the Highways Agency to write to the hon. Member.

  Letter from Lawrie Haynes to Ms Glenda Jackson, dated 22 November 1995:
  As you known, Steven Norris has asked me to reply to your Parliamentary Question asking the Secretary of State for Transport what funding his Department has provided for maintenance of the trunk road network within the Greater London area in each of the years from 1991 to 1995.

  141
  The breakdown between Current and Capital maintenance expenditure on London's trunk road network is as follows:

  £ million

  Financial year

  Capital expenditure

  Current expenditure

  Total

  1991–92

  42.2

  18.6

  60.8

  1992–93

  40.3

  22.8

  63.1

  1993–94

  44.6

  22.5

  67.1

  1994–95

  64.6

  19.4

  84.0

  Current maintenance is largely safety-related and covers routine tasks, such as cleansing, changing light bulbs, grass cutting, winter gritting, emergencies/incidents cover, addressing safety defects and inspections. Capital maintenance includes essential repairs to carriageways, footways and structures to ensure safety and to protect the investment in the infrastructure.
  The variability in the Capital expenditure can be explained by variability in the requirement for major maintenance works. For example, in 1994 the M4 near Heathrow and the M1 near Scratchwood were successfully refurbished, including carriageway and drainage repairs, bridgeworks and the replacement of safety fencing and street lighting. I would add that the work was carried out with very little disruption to road users.

  Rail Privatisation
  Ms Glenda Jackson
  To ask the Secretary of State for Transport what funds he has made available to the Office of Passenger Rail Franchising to implement rail privatisation; and what are his estimates for the financial years 1995–96, 1996–97, 1997–98. [292]

  Mr. Watts
  The public expenditure plans announced in last year's unified budget allocated provision for the Office of Passenger Rail Franchising to spend £11 million in 1995–96. Provisions was made for the expenditure of £10 million in 1996–97 and in 1997–98.

  Ms Jackson
  To ask the Secretary of State for Transport what funds he has made available to the Office of the Rail Regulator to implement rail privatisation; and what are his estimates for the financial years 1995–96, 1996–97, 1997–98. [293]

  Mr. Watts
  My right hon. Friend the Secretary of State announced on 31 October that the Office of the Rail Regulator would have provisions for expenditure of £10 million this year,Official Report, column 131. Provision has been made for the expenditure of £7 million in 1996–97 and in 1997–98.

  Ms Jackson
  To ask the Secretary of State for Transport what funds his Department has spent, or is estimated to spend, on preparations for rail privatisation, excluding funds made available to(a) British Rail, (b) Railtrack Group Plc, (c) Opraf and (d) the Office of the Rail Regulator in (i) 1994–95, (ii) 1995–96 and (iii) 1996–97. [294]

  Mr. Watts
  The answers are as follows:

  (i) 1992–93: £6.7 million

  (ii) 1993–94: £13.5 million

  (iii) 1994–95: £14.2 million

  (iv) 1995–96: £24.6 million

  (iv) 1996–97: £5.3 million

  Figures for 1995–96 onwards are current estimates. These exclude main sale costs for the flotation of Railtrack, which are yet to be determined.
  142
  Ms Jackson
  To ask the Secretary of State for Transport what funds he made available to Railtrack to implement privatisation in 1994–95; and what is his estimate for 1995–96. [291]

  Mr. Watts
  Railtrack spent £46 million on privatisation-related expenditure in 1994–95. The estimate for 1995–96 is £30 million.

  Ms Jackson
  To ask the Secretary of State for Transport if he will show for all consultants and other outside organisations or individuals currently or previously employed by his Department for advice or assistance in rail privatisation(a) the name of the consultancy, organisation or individual, (b) the length of the contract offered to each consultancy, organisation or individual, (c) the total amount inclusive of VAT paid to date to each consultancy, organisation or individual and (d) the services required by his Department from each consultancy, organisation or individual; and if he will make a statement. [270]

  Mr. Watts
  Information about payments to individual contractors is commercially confidential.

  Payments made to date to consultants currently or previously employed by the Department total £35.4 million.

  Consultants currently employed by the Department on rail privatisation are:

  Company

  Consultancy

  Linklaters and Paines

  Legal advice

  Freshfields

  Legal advice

  Samuel Montagu

  Merchant Banking

  Hambros

  Merchant Banking

  SBC Warburg

  Merchant Banking

  Merril Lynch

  Merchant Banking

  KPMG Peat Marwick

  Accountancy and Taxation

  Ernst and Young

  Accountancy

  Price Waterhouse

  Accountancy

  Shandwick

  Marketing

  Gresham

  Marketing

  Dewe Rogerson

  Marketing

  Ernst and Young

  Information Systems

  Richard Ellis

  Property matters

  Sedgwick

  Insurance

  Brodies

  Advice on Scots law

  Travers Morgan

  Specialist advice on BRIS contract pricing

  Ernst and Young

  Corporate finance advice on BRIS contract pricing

  Consultants previously employed by the Department on rail privatisation are:

  Company

  Consultancy

  Arthur D. Little

  Research

  Coopers and Lybrand

  Access and access charging

  Mercer Management

  Freight and franchising

  Norman Broadbent

  Recruitment

  Putnham Hayes and Bartlett

  Access and access charging

  Debenham Tewson and Chinnocks

  Property matters

  NERA

  Regulatory matters

  Deloitte Haskins and Sells

  Industry structure

  143
  Contracts for consultancy advice are normally offered on an on-going basis with provision for the Department to terminate the contract.

  Ms Jackson
  To ask the Secretary of State for Transport what funds he has made available to British Rail for reorganisation in preparation for privatisation. [290]

  Mr. Watts
  Costs linked to privatisation incurred by British Rail are shown in the table:

  £ million cash

  1993–94

  92.2

  1994–95

  85.0

  1995–96

  144.0

  Note:

  1Estimated costs to 30 September 1995.

  Mr. Battle
  To ask the Secretary of State for Transport which lines in the West Yorkshire region will be receiving maintenance attention before rail privatisation. [1447]

  Mr. Watts
  All operational railway lines in West Yorkshire are maintained in accordance with statutory requirements and Railtrack's rigorous safety standards.

  Ms Short
  To ask the Secretary of State for Transport if he will list each British Rail(a) subsidiary and (b) company formerly part of British Rail which has been privatised indicating the receipts from each sale. [1274]

  Mr. Watts
  Sales have been completed for the following businesses:

  Red Star

  Special Trains Unit

  BRIS Design Offices

  DCU Birmingham

  Mainline Swindon

  IDG Glasgow

  BPE Mechanical and Engineering Consultancy, Doncaster.

  Civil Engineering Design Group, York.

  BR Maintenance Ltd.

  Swindon Electronic Service Centre

  Chart Leacon Depot

  Ilford Depot

  Doncaster Depot

  Wolverton Depot

  Springburn Depot

  Eastleigh Depot

  OBS Services Ltd.

  Meldon Quarry Ltd.

  Baileyfield Switches and Crossings Works

  Ditton Timber Treatment Works

  Quality and Safety Services Ltd.

  BR QAS Ltd.

  Gross proceeds to date from these sales amount to nearly £47 million. Details of individual sales completed by BR will be made public in due course, but it would be contrary to the commercial interests of British Rail and the Government to publish those details at this stage, as they may prejudice sales still in progress. In addition to proceeds from sales by BR, proceeds of approximately
  144
  £1.8 billion are expected from the sales of the rolling stock leasing companies, following the signing of sale and purchase agreements announced on 9 November.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for Transport how his Department publicises payment practices other than as percentages of invoices paid late. [968]

  Mr. Norris
  The transport report sets out the Department's payment policy and records performance against targets, in terms of the percentage of bills paid within the time allowed. My right hon. Friend the President of the Board of Trade reports to the House each year the performance of all Departments. I refer the hon. Member to the answer given to my hon. Friend the Member for Dover (Mr. Shaw) on 18 July,Official Report, column 1211–12.

  Mrs. Roche
  To ask the Secretary of State for Transport what is the average length of time it takes for his Department to pay invoices. [920]

  Mr. Norris
  No average payment times are calculated. Our objective is to pay 95 per cent. of bills within contractual conditions, or—where no other conditions are stated—within 30 days of receipt of goods or services or presentation of a valid invoice, whichever is the later.

  Robin Hood Line
  Mr. Allen
  To ask the Secretary of State for Transport what compensation he will give to the residents of Nottinghamshire in respect of their contributions to the cost of the Robin Hood line. [1613]

  Mr. Norris
  The Government have contributed over £6.5 million to stages 1 and 2 of the Robin Hood line; the balance was funded by the European regional development fund and the local authorities concerned. We are discussing with Nottinghamshire county council the case for making a further Government contribution towards the capital cost of the scheme.

  Mr. Allen
  To ask the Secretary of State for Transport when he is planning to privatise the Robin Hood line. [1624]

  Mr. Norris
  Services on the Robin Hood line have been designated as experimental services and are currently being operated by Central Trains Ltd. under an agreement with Nottinghamshire county council. The operating agreement would pass to a future franchisee. The franchising director aims to offer Central to the private sector during or after 1996. The inclusion of the Robin Hood line services in the passenger service requirement for the franchise will be considered by the franchising director before the expiry of the five-year experimental period.

  Fishing Vessels
  Mr. Austin Mitchell
  To ask the Secretary of State for Transport when fishing vessels are(a) registered an (b) re-registered what checking procedures occur in respect of (i) actual engine capacity, (ii) convictions for illegal fishing, (iii) unpaid fines and (iv) the financial status and viability of the company owing the vessel; and

  145
  if he will make it his policy to institute such checks and refuse licenses when the results are unsatisfactory. [979]

  Mr. Norris
  I have asked the chief executive of the Marine Safety Agency to write to the hon. Member.

  Letter from R. M. Bradley to Mr. Austin Mitchell, dated 22 November 1995:
  I have been asked to reply to your Question about the checks undertaken on the registration and re-registration of fishing vessels.
  Fishing vessels are registered and re-registered in accordance with the Merchant Shipping (Registration of Ships) Regulations 1993. The only check listed in the Question which is required by the Regulations is details of engine capacity. Such information is provided to the Registry by surveyors and measurers authorised for that purpose by the Secretary of State.
  Matters concerning the issue of fishing licences are the responsibility of the Minister of Agriculture, Fisheries and Food.

  Ferries (Evacuation Requirements)
  Mr. Redmond
  To ask the Secretary of State for Transport what instructions he has issued to the companies who own the(a) Pride of Bruges, (b) Pride of Cherbourg, (c) Pride of Hampshire and (d) Pioneer ferries to ensure that they fulfil 100 per cent. dry-shod evacuation arrangements; what time limit he has set the companies to fulfil this commitment; what has been their reply; and if he will make a statement. [57]

  Mr. Norris
  I have asked the chief executive of the Marine Safety Agency to write to the hon. Member.

  Letter from R. M. Bradley to Mr. Martin Redmond, dated 22 November 1995:
  The Secretary of State for Transport has asked me to reply to your Question about what instructions have been issued to the companies who own the four ferries named, what time limits have been set and what has been their reply.
  The evacuation requirements for these ferries have not changed. However, the operators concerned have advised that they now offer 100% dry shod evacuation arrangements from these vessels. They have achieved this by limiting the number of passengers carried.

  Night Flights (Heathrow)
  Mr. Allen
  To ask the Secretary of State for Transport what penalties exist for those who exceed the night flight maximum into Heathrow; and if he will list the occasions when such penalties have been levied in each of the past five years. [9]

  Mr. Norris
  The current night restrictions regime, which began in winter 1993–94, includes provision for end of season flexibility. This allows a carry-over of 10 per cent. of the movements limits if there is a surplus and anticipation of up to 10 per cent. of the next season's movements in the event of overrun. Any excess overrun would be penalised in the following season at double the amount of the excess.

  Under the previous regime, if the maximum number of movements at Heathrow was exceeded by 50 or fewer movements, the limit for the following season was reduced by the same number; if by more than 50 movements, the limit for the following season was reduced by a total of 50 plus twice the number of movements in excess of 50. Movements underused in a season could be carried forward to the following season, subject to a maximum of 50.
  146
  In two seasons within the last five years, the number of night movements in the relevant period has exceeded the limit but has been within the end of season flexibility arrangements. In the winter 1992–93 season, there were 3,078 movements, of which 3,000 counted against the limit, 43 movements scored against the amount carried forward from the previous season, and the remaining 35 movements were deducted from the movements limit for the summer 1993 season. In winter 1994–95, there were 2,668 movements; the limit was 2,550 but the excess was within the amount carried forward from the previous season.

  In all other seasons within the last five years, the number of night movements has been within the limits.

  Mr. Allen
  To ask the Secretary of State for Transport how many aircraft are allowed to fly into Heathrow between 23.30 and 0600. [8]

  Mr. Norris
  In my announcement of 16 August 1995, I confirmed the night flying restrictions at Heathrow, Gatwick and Stansted. These restrictions include a control on the number of aircraft movements permitted by season. The movements limit for the winter season at Heathrow is 2,550, the limit for the summer season is 3,250.

  In addition, the movements of aircraft which are exempt from the night restrictions are unrestricted. Exempt aircraft are jet aircraft with a maximum certificated weight not exceeding 11,600 kg and those propeller aircraft which on the basis of their noise data are classified at less than 87 EPNdB.

  The arrangements for dispensations in various exceptional circumstances also continue to apply. A copy of the relevant guidelines was placed in the House Library on 6 May 1994.

  Aircraft Noise Limits
  Mr. Allen
  To ask the Secretary of State for Transport if he will list all the occasions on which airport companies have fined those who have infringed noise limits under their charging powers in the last year for which figures are available(a) at Heathrow and (b) at other airports. [7]

  Mr. Norris
  The Secretary of State may set requirements for limiting noise at airports designated for the purposes of section 78 of the Civil Aviation Act 1982. The only airports so designated are Heathrow, Gatwick and Stansted. The noise limits are 110 PNdB (97 dBA) by day (0701–2300) and 102 PNdB (89 dBA) by night (2301–0700).

  From 1 April 1993 at Heathrow and Stansted and from 1 May 1993 at Gatwick, the airport companies have imposed financial penalties for breaches of the night noise limits and are progressively introducing financial penalties for the breaches of the daytime noise limits. Information on breaches of the noise limits and on the fines collected is provided by each of those airport companies to their respective airport consultative committees. I have asked the three airport companies to send the reports for the last 12 months to the hon. Member for Nottingham, North.

  At other airports, noise mitigation measures are the responsibility of the airport operator.
  147

  Nuclear Rail Flask Incidents
  Ms Glenda Jackson
  To ask the Secretary of State for Transport if he will list the number of nuclear rail flask incidents declared in each year from 1990 to 1995. [281]

  Mr. Norris
  This information is not readily available. I will write to the hon. Member.

  Western Orbital Motorway
  Mr. Pearson
  To ask the Secretary of State for Transport what plans his Department has to undertake a full environment and economic impact assessment of the proposed western orbital motorway; and if he will make a statement. [583]

  Mr. Watts
  Economic and environmental appraisal is carried out throughout the life of a scheme. If draft orders were published for the western orbital, the results of the work at that stage would also be published.

  Transport Infrastructure Schemes (Greater London)
  Ms Glenda Jackson
  To ask the Secretary of State for Transport if he will list those transport infrastructure schemes within the Greater London area to which his Department has contributed funding in excess of £10 million over the past 16 years, the amount of funding provided to each scheme, the start date for each scheme and the completion date for each scheme. [295]

  Mr. Norris
  This information is not held centrally and could be provided only at disproportionate cost. Details of the Department of Transport's spending since 1989–90 are set out in "Transport Report 1995", presented to Parliament in March 1995.

  Pollution
  Mr. William O'Brien
  To ask the Secretary of State for Transport if he will make it his Department's policy to take account of the prevailing winds when pollution samples are taken along motorways; and if he will make a statement. [1317]

  Mr. Norris
  Whenever air quality monitoring is undertaken, the possible effect of the prevailing wind is taken into account as part of the measurement.

  Mr. O'Brien
  To ask the Secretary of State for Transport at what distance from the edge of a motorway sampling is taken for PM10 and particulates. [1316]

  Mr. Norris
  Where PM 10 and particulates are sampled, there is no fixed distance from the motorway edge applied. The distance is normally set by the requirements of the sampling equipment and the characteristics of the monitoring location.

  Mr. O'Brien
  To ask the Secretary of State for Transport what reports his Department receives from the Department of the Environment in respect of the monitoring of pollution along motorways. [1318]

  Mr. Norris
  We receive no such reports. The Department of the Environment does not carry out air quality monitoring adjacent to motorways.
  148
  Mr. O'Brien
  To ask the Secretary of State for Transport what are the terms of reference given by his Department when measuring air quality along motorways. [1315]

  Mr. Norris
  There are no fixed terms of reference for the measurement of air quality alongside motorways.

  Each site is assessed on a preliminary basis in accordance with the design manual for roads and bridges volume 11 "Environmental Assessment" and this informs the need for any further specific measurements.

  River Thames (Freight)
  Ms Glenda Jackson
  To ask the Secretary of State for Transport what has been the volume of freight, in tonnes, carried on the River Thames in each year from 1979 to 1995. [272]

  Mr. Norris
  The volume of freight, in millions of tonnes, carried on the River Thames in each year from 1980 to 1994 was as follows:

  Year

  Internal traffic

  Seagoing traffic

  1980

  6.15

  20.49

  1981

  5.40

  18.36

  1982

  4.39

  21.18

  1983

  3.72

  21.13

  1984

  3.78

  19.65

  1985

  3.50

  21.74

  1986

  3.18

  23.30

  1987

  3.00

  20.90

  1988

  2.93

  23.43

  1989

  3.17

  23.25

  1990

  2.00

  24.75

  1991

  1.83

  21.83

  1992

  1.84

  20.89

  1993

  1.87

  20.39

  1994

  2.83

  21.30

  Figures not available for 1979.

  Fare Capping
  Ms Glenda Jackson
  To ask the Secretary of State for Transport what percentage of passenger rail fares will be capped as a result of the Government's fare capping formulae. [282]

  Mr. Watts
  Across the network, regulation will ensure that there is at least one regulated fare available for every journey. The percentage of passenger revenue subject to fares regulation will vary according to the nature of the franchise. Invitations to tender have been issued in respect of seven passenger rail services—LTS Rail, Great Western, South West Trains, InterCity East Coast, Midland Main Line, Network SouthCentral and Gatwick Express. For those which provide a significant number of commuter services, the percentage of passenger revenue subject to fares regulation, based on 1994–95 figures, is expected to be between approximately 47 per cent., and 80 per cent. For InterCity services, the range is expected to be between approximately 21 per cent. and 25 per cent. These figures do not include Gatwick Express, for which only a very small percentage of passenger revenue will be subject to fares regulation.
  149

  Public Interest Immunity Certificates
  Mr. Cohen
  To ask the Secretary of State for Transport if he will list all those in his Department who have authority to issue public interest immunity certificates; how many such certificates have been issued in each of the last five years; and what were the main reasons for them. [1426]

  Sir George Young
  A claim to public interest immunity relating to departmental documents or information is normally made by the appropriate Minister. No certificates signed by Ministers in my Department have been produced in proceedings in the last five years. Certificates were signed in 1990 and 1992 and in relation to them. I refer to my reply to the hon. Member for Clwyd, South-West (Mr. Jones) on 16 October 1995,Official Report, column 91.

  M11 Link Road
  Mr. Cohen
  To ask the Secretary of State for Transport (1) how much has so far been spent on legal surveillance and other relevant costs to construct cases against people protesting against the building of the M11 link road; how much further public expenditure is expected to bring the cases to trail; how much it is expected will be recouped if the cases are successful; and if he will make a statement; [323]

  (2) if he will list the resident engineers of the various contracts in connection with the A12 Hackney to M11 link road; if he will indicate their salaries and to whom they are responsible; what discrepancies on contractors' claims on personnel matters they have discovered; and if he will make a statement. [328]

  Mr. Norris
  I have asked the chief executive of the Highways Agency to write to the hon. Member.

  Letter from Lawrie Haynes to Mr. Harry Cohen, dated 22 November 1995:
  As you know, the Minister for Railways and Roads, Mr John Watts, has asked me to reply to your Parliamentary Questions asking the Secretary of State for Transport, about the A12 Hackney Wick to M11 Link Road including resident engineers and contractors' claims and the costs of pursing injunctions to stop protestors interfering with the works.
  The resident engineers for the A12 Hackney Wick to M 11 Link Road are, for Contract 2, Mr P Mann and for Contract 4, Mr J P Wood, both of W S Atkins.
  The Code of Practice on Access to Government Information exempts disclosure of Third Party's commerical confidences such as employees' salaries. Resident engineers are responsible to the company employing them.
  If your reference to personnel matters relates to security personnel, I can confirm that in the last two years there have been claims containing errors or anomalies which have been discovered by the resident engineers' staff. The number of these instances has been about average for a contract of this type and all the claims have been resolved under the terms of the contract. However, if you have details of particular discrepancies these will of course be investigated.
  Costs of pursing injunctions incurred to date amount to about £600,000. In order to minimise costs while at the same protecting the contract from continuation of these unlawful protests, the Secretary of State is minded to accept permanent in junction against named defendants and to leave aside the financial aspects provided these injunctions are conceded.
  150
  An offer has been made by the Secretary of State in these terms. Whether further costs arise and to what value, will depend on the defendants and if they concede the injunctions.

  Forth Rail Bridge
  Mr. Donohue
  To ask the Secretary of State for Transport when Railtrack expects to be able to carry out the structural investigation of the Forth rail bridge in accordance with the stipulation of the Health and Safety Executive as part of its investigation of the Forth rail bridge. [1254]

  Mr. Watts
  Railtrack is currently carrying out the structural analysis of the bridge, as requested by the Health and Safety Executive.

  Mr. Donohue
  To ask the Secretary of State for Transport what guidance his Department issued to Railtrack in relation to its co-operation with the Health and Safety Executive's report on the structural condition of the Forth rail bridge. [1256]

  Mr. Watts
  The Department has issued no specific guidance to Railtrack.

  Mr. Donohue
  To ask the Secretary of State for Transport how much was spent on painting the Forth rail bridge in each financial year since 1989–1990; and how the arrangements for painting the bridge have been changed during this period. [1258]

  Mr. Watts
  I understand that British Rail spent approximately £0.5 million on painting and £0.5 million on other maintenance in each financial year from 1989–90 to 1993–94. Railtrack had a similar spending programme in 1994–95, and also completed a £4 million investment programme to replace the weighbeams and renew the rails in July 1994. In the current financial year, Railtrack has doubled the painting budget.

  Mr. Donohue
  To ask the Secretary of State for Transport if he will make a statement indicating the reasons why Railtrack have delayed carrying out a comprehensive structural investigation of the Forth rail bridge. [1413]

  Mr. Watts
  Railtrack is currently carrying out the structural analysis of the bridge, as requested by the Health and Safety Executive. I understand that this analysis is taking slightly longer than planned, due to the complexity of the project.

  Mr. Donohue
  To ask the Secretary of State for Transport if he will make a statement on the current painting and maintenance arrangements for the Forth rail bridge; and to what extent these have been altered during the last year. [1257]

  Mr. Watts
  In July 1995, Railtrack appointed Amec to provide a construction management system ensuring the safe co-ordination of all contractors working on the structure of the bridge. Maintenance has since been organised into 17 distinct work packages and new contracts have been let accordingly. Painting is being carried out by the infrastructure maintenance unit Scotland of British Rail infrastructure services and by Wilkie Hooke.
  151
  Mr. Donohue
  To ask the Secretary of State for Transport what representations his Department has received from the Health and Safety Executive relating to the delays in the publication of its report on the structural condition of the Forth rail bridge. [1253]

  Mr. Watts
  None.

  Mr. Donohue
  To ask the Secretary of State for Transport when his Department originally requested the Health and Safety Executive to publish its report on the structural condition of the Forth rail bridge; and what is the expected timetable for this project. [1255]

  Mr. Watts
  The Department agreed that the Health and Safety Executive should publish its report when the assessment was complete. I understand that HSE's original timetable has slipped slightly and that it now hopes to be able to publish its report early in the new year.

  Rail Electrification Schemes
  Mr. Chidgey
  To ask the Secretary of State for Transport if he will list the outstanding rail electrification schemes in the United Kingdom; and if he will make a statement. [1178]

  Mr. Watts
  Railtrack informs me that there are two outstanding electrification schemes on which implementation works are currently under way. They are Heathrow Express, and North London line electrification.

  Mr. Chidgey
  To ask the Secretary of State for Transport (1) what was the total mileage of electrified railtrack in each of the last 20 years; what percentage of the network this represents; and if he will make a statement; [1177]

  (2) what has been the increase in the electrification of the rail network in each of the last 20 years; what are the projected figures for the next five years; and if he would make a statement. [1179]

  Mr. Watts
  Railtrack informs me that approximately 30 per cent. of the 10,300 route miles in Britain are electrified using overhead and third rail systems. The other information is not held centrally and could be obtained only at disproportionate cost.

  Nuclear Fuel Trains
  Dr. Lynne Jones
  To ask the Secretary of State for Transport when he expects Direct Rail Services Ltd. to begin taking over the running of irradiated nuclear fuel trains and whether its licences include the carriage of irradiated fuel which emanates from abroad. [1566]

  Mr. Watts
  I understand that Direct Rail Services Ltd. intends to begin running services as soon as its train operator's licence is granted. This will be dependent on the necessary pre-conditions being met, which must include a fully approved safety case. The origin of any irradiated fuel carried is not a rail licensing matter.

  Motorways
  Mr. William O'Brien
  To ask the Secretary of State for Transport (1) what responsibilities his Department has in respect of motorway developments and the publication of them to interested parties; and if he will make a statement; [1394]
  152
  (2) who is responsible for issuing statutory notices in connection with motorway changes. [1397]

  Mr. Watts
  I have asked the chief executive of the Highways Agency to write to the hon. Member.

  Letter from Lawrie Haynes to Mr. William O'Brien, dated 22 November 1995:
  As you know, the Minister for Railways and Roads, Mr. John Watts, has asked me to reply to your Parliamentary Questions asking the Secretary of State for Transport, what responsibilities his Department has in respect of motorway developments and the publication of them to interested parties; and if he will make a statement, and who is responsible for issuing statutory notices in connection with motorway changes.
  The main statutory procedures for the development of road schemes are set out in the Highways Act 1980. The Agency is responsible for preparing motorway schemes in accordance with scheme briefs, targets and budgets from the Secretary of State. This includes publicity for schemes at their various stages, issuing statutory notices and publishing draft orders where appropriate.

  Highways Agency
  Mr. Cousins
  To ask the Secretary of State for Transport on what date the former road programme director left the Highways Agency; if the severance terms included lump sum payments; and what subsequent applications under the business appointment rules have been received from him. [1104]

  Mr. Watts
  I have asked the chief executive of the Highways Agency to write to the hon. Member.

  Letter from Lawrie Haynes dated 22 November 1995:
  The Secretary of State for Transport has asked me to reply to your recent question about what date the former Road Programme Director left the Highways Agency; if the severance terms included lump sum payments; and what subsequent applications under the business appointment rules have been received from him.
  The former Road Programme Director left the Highways Agency on 30 April 1995. He received the normal severance terms, which included lump sum payments. The former Road Programme Director made an application under the business appointment rules to accept an appointment with the company Ove Arup and Partners, and this was approved following reference to the Cabinet Office and consultation with relevant trade associations.

  Bicycling
  Mr. Chidgey
  To ask the Secretary of State for Transport what steps he has taken to encourage bicycling; and if he will make a statement. [1180]

  Mr. Norris
  Following the Government's statement of policy on cycling last year, we have taken a number of initiatives to encourage cycling. We are currently considering bids made under the cycle challenge competition, designed to bring forward new ideas and partnerships capable of widespread application in the United Kingdom. We have encouraged local highway authorities to give a higher profile to cycling within their transport policies and programme submissions, and we have indicated that we will take special account of package bids which include provision for cycling. We are supporting the development of the national cycle network, which will open up new route opportunities for recreational, tourist and utility cyclists alike. And we are making good progress in generating a national strategy for cycling which I hope will be complete by next summer.
  153

WALES

  Childhood Immunisation
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Wales what plans he has to review the rules regarding financial penalties imposed on general practitioners who have not met targets set for immunisation; and if he will make a statement. [547]

  Mr. Richards
  Childhood immunisation target payments were introduced to provide incentives for general practitioners to encourage and increase patient take-up of childhood vaccinations. The success of the immunisation programme has resulted in the incidence of childhood diseases being at their lowest-ever levels and I have no plans to review the criteria GPs have to meet in order to qualify for target payments.

  Public Interest Immunity Certificates
  Mr. Cohen
  To ask the Secretary of State for Wales if he will list all those in his Department who have authority to issue public interest immunity certificates; how many such certificates have been issued in each of the last five years; and what were the main reasons for them. [1429]

  Mr. Hague
  A claim to public interest immunity relating to departmental documents or information is normally made by the appropriate Minister. There have been no cases in which certificates were used inter partes in proceedings.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for Wales (1) what is the amount owed to those businesses whose invoices were not paid in accordance with agreed contractual conditions or within 30 days in each of the last five years; [1118]

  (2) how many orders and firms are represented by the 5 per cent. of invoices not paid by his Department within 30 days or in accordance with contractual agreements in 1994–95; and how many of these are related to firms with fewer than 500 employees. [941]

  Mr. Hague
  The information is not available in the form requested and could be provided only at disproportionate cost.

  Mrs. Roche
  To ask the Secretary of State for Wales how his Department publicises payment practices other than as percentages of invoices paid late. [970]

  Mr. Hague
  The Welsh Office publicises its payment policy in its annual departmental report, and on all official orders and contracts.

  Mrs. Roche
  To ask the Secretary of State for Wales what is the average length of time it takes for his Department to pay invoices. [918]

  Mr. Hague
  The information is not available in the form requested. However, once valid invoices are received by my finance division, they are all paid within seven working days.
  154

  Cardiff Bay Development Corporation
  Sir Wyn Roberts
  To ask the Secretary of State for Wales when he expects to announce his final decision, on the sites to be acquired for development as bird compensation/mitigation measures, for the loss of Cardiff bay habitat following completion of barrage construction. [2212]

  Mr. Hague
  The Cardiff Bay development corporation, acting on the advice of the Countryside Council for Wales, the Royal Society for the Protection of Birds and the Land Authority for Wales, has submitted its report on alternative site options to the Goldcliff/Redwick proposals. I expect to announce my final decision on site acquisition and place a copy of the Cardiff Bay development corporation report in the Library of the House shortly, following detailed discussions with the European Commission and the Countryside Council for Wales.

  Education
  Sir Wyn Roberts
  To ask the Secretary of State for Wales when he is likely to reach conclusions following consultation on "A Bright Future: Getting the Best for Every Pupil at School in Wales". [2213]

  Mr. Hague
  Comments were invited on how best to raise standards and make a success of the programme set out in "A Bright Future". Earlier today I indicated that the reaction has been heartening. It confirms that the achievements of higher standards in Welsh schools is both possible and necessary. There is a ready acceptance that targets for improvement should be set—school by school, as well as at the national level. I shall be publishing a commentary on all this shortly, to emphasise the significance of the programme and to affirm its contents.

  In addition, "A Bright Future" consulted on a proposal that a specific target be set for Wales so that, by 2000, half of all individual 15-year-olds should get an A-C grade in each of GCSE mathematics, science, English or Welsh (first language). I can confirm this target. It will demand a significant uplift in performance annually; but even matching the progress of the last two years, in each of the next five would bring us within striking distance of the goal. It is important to measure the progress against a target expressing ambitions for what ought to be achieved. The target is for Wales as a whole, not for individual schools. I look to schools to set their own targets—where appropriate with the assistance of LEAs and others who can provide local support—to improve their performance year by year.

  The independent school inspectorate is also working with schools to set new targets following inspections and it will monitor progress.

NORTHERN IRELAND

  Further Education
  Mr. Worthington
  To ask the Secretary of State for Northern Ireland (1) how many full and part-time lecturing staff were employed in colleges of further education using funds provided by the Training and Employment Agency in each year since 1990; [1113]
  155
  (2) how much money has been provided by the Training and Employment Agency for the employment of lecturing staff in institutes of further and higher education in real and constant price terms. [114]

  Mr. Ancram
  Responsibility for the subject in question has been passed to the Training and Employment Agency under its chief executive, Mr. Ian Walters. I have asked him to arrange for a reply to be given.

  Letter from Ian Walters to Mr. Tony Worthington, dated 21 November 1995:
  The Secretary of State for Northern Ireland has asked me as Chief Executive of the Training and Employment Agency, to reply to your question.
  The Agency purchases training from approximately 160 training providers in Northern Ireland including the Colleges of Further Education. Since these colleges also provide training which is paid for from other sources, it is therefore not possible for the Agency to determine the number of full and part-time lecturing staff whose employment is directly or indirectly due to Agency funding.
  The Training and Employment Agency does not itself employ lecturing staff in Colleges of Further Education and therefore cannot provide a meaningful response to your question.
  I am sorry that I cannot be more helpful on this occasion.

  Neighbour Disputes
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland what priority the RUC places on dealing with disputes between neighbours; what resources it has in place in North Down to counteract this problem; and what discrete statistics it maintains to monitor the scale and growth of such disputes. [74]

  Sir John Wheeler
  The primary duty of a police officer is to serve the whole community and protect its citizens from all unlawful and harmful acts, from whatever source. The RUC places a high priority on investigating all breaches of the law, including disputes between neighbours.

  Disputes between neighbours in the North Down area are given the same priority as elsewhere in the Province. Disputes of this kind are considered within the role of normal police duty and the police liaise with relevant agencies such as Northern Ireland Housing Executive, Department of the Environment or North Down Borough Council if the dispute relates to dogs or noise.

  No discrete statistics are held relating to such disputes.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for Northern Ireland what is the amount owed to those businesses whose invoices were not paid within 30 days or in accordance with contractual agreements in each of the last five years; [1120]

  (2) how many orders and firms are represented by the 5.3 per cent. of invoices not paid by his Department within 30 days or in accordance with contractual agreements in 1994–95; and how many of these are related to firms with fewer than 500 employees. [940]

  Sir John Wheeler
  The information is not readily available in the format requested and could be provided only at disproportionate cost.
  156
  Mrs. Roche
  To ask the Secretary of State for Northern Ireland how his Department publicises payment practices other than as percentages of invoices paid late. [963]

  Sir John Wheeler
  The Northern Ireland Office and the Northern Ireland Departments payment practices and performances are published in the departmental report. The Department of Agriculture also publishes its payment targets in the booklet "Our Service Standards".

  Mrs. Roche
  To ask the Secretary of State for Northern Ireland what is the average length of time it takes for his Department to pay invoices. [925]

  Sir John Wheeler
  The information requested is not available in the Northern Ireland Office, the Department of Economic Development or the Department of Health and Social Services, excluding the Child Support Agency. The average length of time taken to make payments by the other four Northern Ireland Departments and the CSA ranges from 10 days to 20 days.

  Students
  Mr. Worthington
  To ask the Secretary of State for Northern Ireland how many Northern Ireland students attend(a) English and Welsh, and (b) Scottish universities; and how many there are in each by academic specialism. [1219]

  Mr. Ancram
  The information is as follows:

  English and Welsh institutions

  Scottish institutions

  Medicine and Dentistry

  304

  386

  Subjects Allied to Medicine

  613

  242

  Biological Sciences

  244

  245

  Veterinary Science

  55

  59

  Agriculture and Related Subjects

  155

  84

  Physical Sciences

  344

  199

  Mathematical/Computer Sciences

  1,129

  573

  Engineering and Technology

  458

  308

  Architecture, Building and Planning

  1,079

  423

  Social, Economic and Political Studies/Law

  1,263

  832

  Business and Administrative Studies

  351

  232

  Librarianship and Information Science

  205

  100

  Languages

  443

  76

  Humanities

  591

  105

  Creative Arts

  249

  112

  Education

  398

  453

  Combined

  0

  0

  Total

  7,881

  4,429

  In addition, there were 2,556 Northern Ireland domiciled students studying with the Open university.

  Exclusion Orders
  Mr. Worthington
  To ask the Secretary of State for Northern Ireland (1) how many exclusion orders have been(a) imposed, (b) revoked, (c) reimposed at the expiry of a previous order and (d) allowed to lapse in the last 12 months; [1220]
  157
  (2) how many exclusion orders made under the prevention of terrorism legislation are currently in force. [1221]

  Sir John Wheeler
  No exclusion orders have been imposed or reimposed by the Secretary of State for Northern Ireland in the past 12 months. All 10 outstanding exclusion orders for which he was responsible were revoked in February of this year.

NATIONAL HERITAGE

  Scratchcards
  Miss Lestor
  To ask the Secretary of State for National Heritage what(a) complaints and (b) representations she has received about the sale of scratchcards to young people below the age of 16 years; and if she will make a statement. [422]

  Mr. Sproat
  I have received a number of representations about the national lottery. It is not possible to determine the number which have been about the sale of scratchcards to young people below the age of 16, without incurring disproportionate cost.

  "Sport: Raising the Game"
  Mr. Pendry
  To ask the Secretary of State for National Heritage what was the total cost involved in the printing and publication of "Sport: Raising the Game". [1554]

  Mr. Sproat
  The total cost to the Department of National Heritage of the printing and publication of 70,000 copies of "Sport: Raising the Game" was £63,900.00.

  A further 15,000 copies of the document were reprinted in October, at a cost of £19,500 to meet exceptional demand.

  The cost of the distribution of the document to all schools, higher education and further education institutions and all local education authorities was approximately £28,000 and was met by the then Department for Education.

  Lockerbie
  Mr. Dalyell
  To ask the Secretary of State for National Heritage what advice has been sought by representatives of the media from Her Majesty's Government about problems associated with the destruction of the airliner Pan Am 103 over Lockerbie. [1629]

  Mr. Sproat
  I am not aware that any such advice has been sought from my Department.

  British Library
  Mr. Spellar
  To ask the Secretary of State for National Heritage if she will make a statement regarding progress on the construction of the British library. [410]

  Mr. Sproat
  The building is being constructed in two phases—phase 1A and the completion phase. Phase 1A is largely complete, and work on the completion phase will continue into the last quarter of 1996. It is planned that the whole building will be completed toward the end of 1996.
  158

  Works of Art
  Mr. Gordon Prentice
  To ask the Secretary of State for National Heritage how many acquisitions of works of art museums in England and Wales have purchased for each year since 1985; and what was their value in each year in constant prices. [193]

  Mr. Sproat
  The information requested is not held centrally and could be obtained only at disproportionate cost.

  Purchase Grants (Museums)
  Mr. Gordon Prentice
  To ask the Secretary of State for National Heritage what would be the present value of purchase grants for museums in England and Wales had the grants been uprated in line with inflation since 1985. [192]

  Mr. Sproat
  Until 1992–93, grant in aid allocations to national museums and galleries in England included a separate provision for purchases which had been kept constant since 1985. Since 1992–93, trustees of those institutions have been free to decide for themselves how much of their grant in aid should be devoted to purchases for their collections. The national museums and galleries of Wales still receives a differentiated grant in aid for running costs, building and maintenance work and purchases for the collection. Had the purchase grants for 1985–86 been increased exactly in line with the deflators for the gross domestic product, they would be as follows:

  £ million

  Institution

  1995–96

  British Museum

  2.316

  Imperial War Museum

  0.159

  National Gallery

  4.362

  Natural History Museum

  0.301

  National Maritime Museum

  0.325

  National Portrait Gallery

  0.492

  Science Museum

  0.731

  Tate Gallery

  2.879

  Victoria and Albert Museum

  1.816

  Wallace Collection

  0.0

  National Museum's and Galleries of Wales

  1.757

  Coronation Crown of Queen Adelaide
  Mr. Gordon Prentice
  To ask the Secretary of State for National Heritage if she will take steps to ensure the frame of the coronation crown of Queen Adelaide is classified as regalia and is not granted an export licence to the United States of America. [194]

  Mr. Sproat
  Following an objection to the issue of an export licence by my Department's expert adviser, the application to export the frame of the coronation crown of Queen Adelaide was referred, in the normal way, to the reviewing committee on the export of works of art. The reviewing committee consulted my Department, the Treasury Solicitor's Department and the Lord Chamberlain's Office on whether the crown frame constituted regalia. The reviewing committee was advised that the discarded crown frame could not be regarded as part of the regalia.
  159
  A decision on the export licence application has been deferred until after 24 January 1996 to give the opportunity for an offer to purchase the crown frame to be made at or above the fair market price of £425,000.

  A summary of this case is contained in the annual report of the reviewing committee on the export of works of art 1994–95, which was placed in the Library of the House last 24 October. Decisions on the export licence applications for the frame of the imperial crown of George I and the frame of the coronation crown of George IV have also been deferred until after 24 January 1996 to enable purchase offers to be made.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for National Heritage what is the average length of time it takes for her Department to pay invoices. [926]

  Mr. Sproat
  The information requested is not available and could be provided only at disproportionate cost, but a sample of invoices received by the Department of National Heritage during this financial year shows that the average length of time for payment of invoices is currently 20 days.

  Mrs. Roche
  To ask the Secretary of State for National Heritage how many orders and firms are represented by the 9.4 per cent. of invoices not paid by her Department within 30 days or in accordance with contractual agreements in 1994–95; and how many of those are related to firms with fewer than 500 employees. [916]

  Mr. Sproat
  The sample of invoices used in the calculation shows that the figure represents 90 orders and firms. Our records cannot be used to determine firms with fewer than 500 employees.

  Mrs. Roche
  To ask the Secretary of State for National Heritage how her Department publicises payment practices other than as percentages of invoices paid late. [962]

  Mr. Sproat
  The Department of National Heritage publicises only payment practices as percentages of invoices paid within contract terms or 30 days. As required, these details of our annual payment performance are included in our departmental reports.

  Mrs. Roche
  To ask the Secretary of State for National Heritage what is the amount owed to those businesses whose invoices were not paid within 30 days or within agreed contractual provisions in each of the last five years. [1122]

  Mr. Sproat
  The information requested is not available and could be provided only at disproportionate cost, but the following has been produced on the basis of the sample of invoices received by the Department of National Heritage and used to reply to the hon. Member on 1 November,Official Report, column 267:

  Amount owed £'000

  1993–94: 246

  1994–95: 753

  1995–96: 166

  There are no comparable departmental figures for earlier years as the Department's payment system was not in place until 1993, following the establishment of DNH in April 1992.
  239912 2A
  160

  British Academy of Sport
  Mr. Pendry
  To ask the Secretary of State for National Heritage when her Department plans to publish proposals relating to the establishment of the new British academy of sport. [1469]

  Mr. Sproat
  I expect the Sports Council to publish a consultation paper on proposals for the British academy of sport on 5 December.

  Television Rights (Football)
  Mr. Pendry
  To ask the Secretary of State for National Heritage what action her Department is planning to prevent any single broadcasting company having a monopoly on the rights to televise live domestic football. [1477]

  Mr. Sproat
  The Government have no plans to alter current arrangements under which, with the exception of listed sporting events which cannot be shown on a pay-per-view basis, sports rights holders are free to dispose of their rights to broadcast in the way they choose.

  European Championship
  Mr. Pendry
  To ask the Secretary of State for National Heritage how much money the Government have promised to help fund activities associated with the Euro-96 tournament. [1474]

  Mr. Sproat
  We have made available £400,000 for the cultural festival linked to Euro-96. We are also considering how National Music Day, which falls on the weekend of the championship finals, can be focused on associated cultural events.

  Sporting Events (Broadcasting)
  Mr. Pendry
  To ask the Secretary of State for National Heritage when her Department last examined the likely impact of digital technology on the broadcasting of sporting events; and what was the outcome. [1498]

  Mr. Sproat
  We have been looking carefully at this and many other issues as we have been developing our proposals for the regulatory framework for digital terrestrial television. Digital technology will mean that there will be more opportunities for the coverage of sport on television, providing greater access and choice for the viewer.

  Public Interest Immunity Certificates
  Mr. Cohen
  To ask the Secretary of State for National Heritage if she will list(a) who in her Department has authority to issue public interest immunity certificates and (b) how many have been issued in each of the last five years, giving the reasons for each case. [1420]

  Mr. Sproat
  A claim of public interest immunity relating to departmental documents or information would normally be made by the appropriate Minister.

  Since my Department was established in April 1992, it has not issued any public interest immunity certificates.
  161

  Royal Palaces
  Mr. Alan Williams
  To ask the Secretary of State for National Heritage what was the cost to grant in aid of the occupied royal palaces in(a) 1990, (b) 1991 and (c) 1992 net of (i) the costs associated with the fire at Windsor and (ii) the costs of the exceptional work started at Windsor in 1987–88. [1321]

  Mr. Sproat
  [holding answer 21 November 1995]: Costs associated with the fire and costs of the exceptional work were given in my earlier reply on 31 October 1995, Official Report, column 185. The grant in aid net of these factors was:

  1990–91: £19.931million

  1991–92: £19.71 million

  1992–93: £15.53 million

  This figure assumes that expenditure on the exceptional work was the same in each of the five years 1986–87 to 1990–91. As stated in the earlier answer, figures for each year are not available.

  Mr. Williams
  To ask the Secretary of State for National Heritage what estimate has been made of the cost of providing details of expenditure on the furnishing of directors' apartments in the occupied royal palaces in each year from 1982 to 1991; and how these costs have been arrived at. [1322]

  Mr. Sproat
  [holding answer 21 November 1995]: It is estimated that extraction of this information would cost about £2,000 in direct additional staff costs. File handling, transport and supervision could double that.

  The PSA files have been put away in bulk. It seems from its lists that we would probably need to screen some 200 volumes to identify the right ones before we could extract and present the right information. Even then, we might not find the information in these files and might have to search further. The estimate was built up on the basis of time for each volume depending on how relevant it is found to be.

  Ministerial Transport, London
  Mr. MacShane
  To ask the Secretary of State for National Heritage how many times in the last year she has used(a) the London Underground and (b) London buses while on official business. [423]

  Mrs. Virginia Bottomley
  Infrequently. Such records are not kept.

LORD PRESIDENT OF THE COUNCIL

  Public Interest Immunity Certificates
  Mr. Cohen
  To ask the Lord President of the Council if he will list all those in his Department who have authority to issue public interest immunity certificates; how many such certificates have been issued in each of the last five years; and what were the main reasons for them.

  Mr. Newton
  A claim to public interest immunity relating to departmental documents or information is normally made by the appropriate Minister. No public interest immunity certificates have been issued by my Department in the last five years.
  162

  Ministerial Transport, London
  Mr. MacShane
  To ask the Lord President of the Council how many times in the last year he has used(a) London Underground and (b) London Transport buses while on official business.

  Mr. Newton
  None. However, the nature of my duties means that the overwhelming majority of my movements in London on official business are only between Whitehall and the House.

SCOTLAND

  Motorway Crash Barriers
  Mr. Bellingham
  To ask the Secretary of State for Scotland how many miles of dual carriageway and motorway there are in Scotland that do not have the protection of crash barriers. [776]

  Lord James Douglas-Hamilton
  A total of 71 miles.

  Munitions Dumping (South-west Scotland)
  Mr. Foulkes
  To ask the Secretary of State for Scotland what representations he has received regarding the survey he has asked the Marine Laboratory to undertake off the coast of south-west Scotland. [787]

  Mr. Raymond S. Robertson
  A number of companies with specialist expertise in underwater exploration have contacted Scottish Office scientists to offer their assistance with the marine survey of the Beaufort's dyke area.

  Local Government Services
  Mr. McMaster
  To ask the Secretary of State for Scotland when he next plans to meet representatives of the Convention of Scottish Local Authorities to discuss the funding of local government services. [788]

  Mr. Kynoch
  On 19 January.

  Mrs. Adams
  To ask the Secretary of State for Scotland when he next plans to meet COSLA to discuss local government finances. [795]

  Mr. Kynoch
  I refer the hon. Member to the answer I gave earlier today to the hon. Member for Paisley, South, (Mr. McMaster).

  Migration
  Mr. David Evans
  To ask the Secretary of State for Scotland what estimate he has made of the number of individuals who moved residence from England to Scotland in the last year. [789]

  Lord James Douglas-Hamilton
  It is estimated that 47,000 individuals moved residence from England to Scotland in 1994.

  Scottish Economy
  Dr. Reid
  To ask the Secretary of State for Scotland when he last met with the chief executive of Scottish Enterprise to discuss the Scottish economy; and if he will make a statement. [790]

  Mr. Kynoch
  Last week.
  163

  National Health Service
  Mr. Ernie Ross
  To ask the Secretary of State for Scotland when he last met the chairman of health boards in Scotland to discuss the national health service. [792]

  Mr. Malcolm Bruce
  To ask the Secretary of State for Scotland when he last met the chairman of Grampian health board to discuss community hospital provision in the north-east. [793]

  Lord James Douglas-Hamilton
  My right hon. Friend and I meet health board chairmen regularly to discuss matters of current interest.

  Tree Planting
  Mr. Ian Bruce
  To ask the Secretary of State for Scotland how many trees have been planted by the forestry industry in the United Kingdom within each of the past five years. [794]

  Mr. Kynoch
  Over 70 million trees were planted in the United Kingdom in each of the last five years.

  A92 (Accidents)
  Mr. Welsh
  To ask the Secretary of State for Scotland if he will state the number of deaths, injuries, and accidents on the A92 Dundee, Arbroath to Montrose road in the current year to date; and if he will make a statement. [796]

  Lord James Douglas-Hamilton
  Between 1 January and 31 October 1995, the latest date for which the requested statistics are available, there were five deaths and 30 other casualties arising from 60 accidents, including 39 non-injury accidents, on the A92 between Dundee and Montrose. This stretch of the A92 is a local road and responsibility for road safety on it rests with the local roads authority, Tayside regional council.

  Departmental Staff
  Mr. Canavan
  To ask the Secretary of State for Scotland if he will name all Scottish Office staff who are political appointments, the nature of their responsibilities and the cost to public funds of employing them. [797]

  Mr. Michael Forsyth
  I have two special advisers, Mr. Gerald Warner and Mrs. Jacqui Low. They assist me with that part of my work which is partly governmental and partly political. There is a nationally agreed salary range for special advisers; individuals are paid at a rate within that range which equates to salary in their previous employment.

  Forestry Commission Woodland
  Mrs. Ray Michie
  To ask the Secretary of State for Scotland what plans he has to increase the number of Forestry Commission woodlands to be held by local communities. [798]

  Mr. Kynoch
  We are currently considering how local communities can become more involved in the management of Forestry Commission woodlands.
  164

  Private Finance Initiative (NHS)
  Mr. Robert G. Hughes
  To ask the Secretary of State for Scotland if he will make a statement on the private finance in initiative in the national health service. [799]

  Mr. Kynoch
  Good progress is being made with the private finance imitative. A number of major schemes are now at advanced stages in the process and are due to come to fruition within the next few months. There is confidence among those taking these schemes forward that the PFI will offer considerable benefits to the NHS.

  Under-age Drinking
  Mr. Gallie
  To ask the Secretary of State for Scotland what plans he has to reduce under-age drinking in public places in Scotland; and if he will make a statement. [801]

  Lord James Douglas-Hamilton
  Under-age drinking is a cause for concern in any context. The Health Education Board for Scotland continues to promote a range of materials aimed at educating young people about the risks of excessive or inappropriate drinking. We are also looking, together with other Government Departments, at what steps might be taken to address the problem of so-called designer alcoholic products associated with under-age drinking.

  We are also concerned to reduce the problem of nuisance caused by people of any age drinking in public places and have invited local authorities to propose byelaws to address this by making it an offence to drink in designated public places. We have so far confirmed byelaws in six local authority areas. Many other authorities are in the process of preparing proposals.

  Road Programmes
  Mr. McKelvey
  To ask the Secretary of State for Scotland when he next plans to meet COSLA to discuss roads programmes. [802]

  Lord James Douglas-Hamilton
  My right hon. Friend has no plans at present to meet COSLA specifically to discuss roads programmes.

  Job Creation
  Mr. Kirkwood
  To ask the Secretary of State for Scotland what plans he has to promote job creation in the Border region; and if he will make a statement. [803]

  Mr. Kynoch
  Scottish Borders Enterprise, which has a budget of £9.6 million in 1995–96, has the main responsibility for promoting economic development in the Borders. The SBE acts in co-operation with local authorities and other economic development agencies.

  Fisheries
  Mrs. Ewing
  To ask the Secretary of State for Scotland when he last met representatives of the Scottish Fishermen's Federation to discuss current problems of the fishing fleet; and if he will make a statement. [804]

  Mr. Raymond S. Robertson
  My right hon. Friend last met representatives of the Scottish Fishermen's Federation in Luxembourg on 26 October when, together
  165
  with my hon. Friend the Minister of State at the Ministry of Agriculture, Fisheries and Food, he represented the United Kingdom at the Council of Fisheries Ministers. The current problems facing the fishing fleet were fully discussed.

  Mr. Hicks
  To ask the Secretary of State for Scotland what discussions his Department has had with MAFF concerning allegations that Scottish-based fishing vessels have been fishing illegally in the south-west mackerel box; and if he will make a statement. [808]

  Mr. Robertson
  The Scottish Office maintains close contact with the Ministry of Agriculture, Fisheries and Food on fisheries issues. The mackerel box is kept under close surveillance by the Ministry's sea fisheries inspectorate. There is no evidence of illegal fishing by Scottish vessels operating in the box.

  National Tree Week
  Mr. Rathbone
  To ask the Secretary of State for Scotland what plans he has to support national tree week. [805]

  Mr. Kynoch
  The Government support tree planting every week of the year. Last year, we provided funds for the planting of over 70 million trees.

  Infill Tax
  Mr. Eric Clarke
  To ask the Secretary of State for Scotland if he has met Scottish Power to discuss the consequences of the proposals to impose an infill tax on fly ash from coal-fired generating units in Scotland. [807]

  Mr. Kynoch
  In the course of a recent visit I made to Longannet power station, Scottish Power raised with me a number of issues including the implementation of the landfill tax proposal by the Chancellor of the Exchequer.

  Departmental Staff (Duties)
  Mr. Nigel Griffiths
  To ask the Secretary of State for Scotland if he will review the work of civil servants in the Scottish Office in dealing with matters affecting the political party in government. [809]

  Mr. Michael Forsyth
  The rules about civil servants participating in party political matters are clear and rigorously enforced. There is therefore no need for me to review the work of civil servants in the Scottish Office regarding such matters.

  Historic Buildings (Restoration)
  Mr. Gordon Prentice
  To ask the Secretary of State for Scotland what steps is he taking to ensure there is an adequate supply of Scottish slate and other traditional building materials needed for the authentic restoration of Scotland's historic buildings. [195]

  Lord James Douglas-Hamilton
  Since these are matters for Historic Scotland, I have asked the agency's chief executive, Mr. Graeme Munro, to write to the hon. Member as soon as possible. A copy of Mr. Munro's letter will be placed in the Library of the House.
  166
  Letter from Graeme N. Munro to Mr. Gordon Prentice dated 22 November 1995:
  I have been asked to reply to your question to the Secretary of State for Scotland on the steps being taken to ensure the continuing supply of Scottish slate and other traditional building materials for use on Scotland's historic buildings.
  As you will appreciate, this is a topic which greatly concerns us in Historic Scotland and a considerable amount of work is presently being devoted to it. Where necessary, we are working in conjunction with colleagues in Scottish Enterprise and other organisations to address the issues involved.
  To undertake effective conservation and the authentic restoration of Scotland's built heritage, it is critical that properly trained craftsmen have appropriate traditional building materials at their disposal. Through an integrated approach, Historic Scotland aims to encourage industry, material suppliers, and the education and training providers, to achieve this objective.
  In 1993, Historic Scotland established a Technical Conservation, Research and Education Division. The Division is charged with the responsibility of conducting or commissioning research into technical conservation issues, developing skills relating to the built heritage, and raising the standard of conservation practice among owners, contractors, professional groups and craftsmen.
  If we are successfully to encourage the revival of key supply industries there is a need to investigate the supply of traditional building materials. As a result, a number of related studies are currently underway.
  To obtain a comprehensive overview of Scottish stone supplies, and their potential for use in future conservation and restoration projects, a strategic study has been commissioned. This will involve examining ways in which the Scottish stone industry might arrest the decline in the use of indigenous stone, and give pointers to how this trend might be reversed.
  As no slate has been produced in Scotland since the early 1950s a major geological study into Scottish slate reserves has been commissioned from Glasgow University. A separate study by Dundee University will try to quantify the extent of change which has taken place through the use of alternative roof covering materials. Both studies aim to provide Historic Scotland with a strategic overview of the issues involved and with information which will assist decision makers and specifiers on the available, and future, potential for Scottish slate.
  Over recent years there has been a steadily increasing awareness of the significant damage being caused to historic buildings as a result of the inappropriate use of cement in repair work. Whilst a number of Scottish outlets still produce lime, none of that is readily available for use in building conservation work. To assess the quality of what is to hand, Historic Scotland has commissioned a scientific analysis of lime from 15 locations around Scotland. This information will be used to encourage industry to restart lime burning and slaking. If successful, this will greatly enhance the ability of specifiers to choose the correct material to undertake sensitive repairs on the exterior and interior of historic buildings.
  To assist in this process, Historic Scotland has recently published 3 relevant technical publications—

  Preparation and Use of Lime Mortars—Technical Advice Note 1

  Conservation of Plasterwork—Technical Advice Note 2

  The Repair of Historic Buildings in Scotland

  Supplementary publications, promoting the results of case studies into traditional lime harling and a Technical Advice Note on lime washing are also planned.As part of the associated education process, Historic Scotland recently held a successful international conference on lime. This attracted 170 delegates, with representatives from 15 different countries and was warmly received by practitioners and industry representatives alike.167 With a greater researched awareness of Scottish traditional building details has come a fuller understanding of the widespread use of earth and clay as an indigenous building material. Currently, Historic Scotland is researching this area with a view to producing a further technical publication. Our plan is that this should be launched at an international conference on the topic, due to be held at Dundee University in August 1996, in conjunction with the ICOMOS Out of Earth conference series.A similar increasing understanding of the wide variety of natural materials used in traditional Scottish thatching techniques has steadily developed in recent years. Much of this information has been rediscovered as a result of grant-aiding the repair of thatched buildings around the country under Historic Scotland's Historic Building Repair Grant Scheme. Presently, research is underway to analyse the practical aspects of these projects, and to link this to an increased historic understanding. The intention is to produce a Technical Advice Note on Scottish Thatch and Thatching Techniques by the end of 1995 this year.In taking a key role in the promotion of the need to use appropriate traditional materials, Historic Scotland is playing a major part through its Historic Buildings Repair Grant Scheme to pump prime the industry in this area. With repair and maintenance output in Scotland now amounting to over 40% of all construction spend in Scotland, this input has considerable influence. By promoting the results of its research programmes through publications, conferences, seminars and lectures, Historic Scotland also aims to take forward with industry, the professions, and the education and training providers, an integrated approach to the future development and use of Scottish traditional building materials.

  Public Interest Immunity Certificates
  Mr. Cohen
  To ask the Secretary of State for Scotland if he will list all those in his Department who have authority to issue public interest immunity certificates; how many such certificates have been issued in each of the last five years; and what were the main reasons for them.

  Lord James Douglas-Hamilton
  Public interest immunity certificates are authorised and signed by my right hon. Friend.

  In 1993, two certificates were signed. Each related to proceedings in the Court of Session raised by a prisoner against the Secretary of State for Scotland. Each certificate concerned matters of prison security. In one of the cases, the certificate was produced in the court proceedings.

  In each of the other years, no certificates have been issued.

  Skye Bridge (Tolls)
  Mr. Kennedy
  To ask the Secretary of State for Scotland if he will express the average toll charge per mile for a car in respect of the Skye bridge; and if he will make a statement. [237]

  Lord James Douglas-Hamilton:
  [holding answer 21 November 1995]: The Skye crossing is approximately 1.5 miles long, of which the bridge itself is about 0.5 miles. A regular car user will pay £2.44 per crossing, equivalent to £1.63 mile. A car user at the non-discount price will pay £4.30 per crossing equivalent to £2.87 per mile. The tolls were fully discussed at the public local inquiry and are less than the pre-existing ferry fares.
  168

  NHS Staff Pay Rates
  Mr. Wallace
  To ask the Secretary of State for Scotland what rate of pay increases have been negotiated for 1995–96 in respect of nurses and other employees subject to Whitley Council pay rates who are in the employment of Orkney health board and Shetland health board; and if he will make a statement [238]

  Mr. Michael Forsyth
  [holding answer 21 November 1995]: Hospital doctors and dentists were awarded increases of 2.5 per cent. with the facility for further increases to be negotiated locally for those in the consultant grade. These enhanced rates have been in payment since April 1995.

  Agreement has recently been reached that nurses and all other staff employed by health boards, except general and senior managers, will be awarded a pay increase of 2.5 per cent. on national rates, backdated to 1 April 1995, with the opportunity for further increases to be negotiated locally.

  These increases apply to all staff not employed in NHS trusts and form part of a package which has, I am pleased to say, brought an end to the dispute over the 1995 pay award to NHS staff.

  Structural Funds
  Mr. Wallace
  To ask the Secretary of State for Scotland if he will provide details of the distribution of EU objective 3 structural funding in Scotland in respect of(a) 1994 and (b) 1995 to date. [239]

  Mr. Michael Forsyth
  [holding answer 21 November 1995]: The amount claimed for 1994 by Scottish-based applicants is £46.3 million. This excludes a small amount of grant claimed for Scottish projects run by applicants based elsewhere in Great Britain.

  For 1995, £45.3 million has so far been committed to Scottish projects. A further £1 million will be committed before the end of the calendar year.

  Distribution of objective 3 moneys within Scotland, by area or agency, is not yet available.

  Highlands and Islands Airports
  Mr. Kennedy
  To ask the Secretary of State for Scotland when he expects to announce his conclusions on the review of Highlands and Islands airports; if he intends to publish the consultants' report; and if he will make a statement. [226]

  Lord James Douglas-Hamilton
  [holding answer 21 November 1995]: The report by Quayle Munro has not yet been received and no conclusions have been reached.

  No decision has been made on whether the report will be published.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for Scotland how his Department publicises payment practices other than as percentages of invoices paid late. [965]

  Lord James Douglas-Hamilton
  The Department's payment practices are publicised in the departmental report and the guide to suppliers wishing to do business
  169
  with the Scottish Office—"Selling to The Scottish Office". The Department's standard terms and conditions of contract give details of payment terms and what action should be taken by suppliers on late payment of invoices. The booklet and standard terms and conditions are available on request.

  Mrs. Roche
  To ask the Secretary of State for Scotland what is the average length of time it takes for his Department to pay invoices. [923]

  Lord James Douglas-Hamilton
  In 1994–95 the Scottish Office paid suppliers on average 10 days from receipt of a valid invoice or the goods or services, whichever was the later.

  This was the result of pursuing three objectives:

  1. The aim of paying all suppliers within the period stipulated by the contract—normally, but not always, 30 days. This objective was met on 96 per cent. of payments in 1994–95.

  2. The desirability of taking advantage of early settlement discounts where this makes good business sense.

  3. The need to batch together payments covering several invoices in order to minimise the administrative costs of making payments.

  Flooding (Clyde)
  Mr. Worthington
  To ask the Secretary of State for Scotland what information he holds on the impact of dredging policy and building on low-lying land on both sides of the Clyde on the likelihood of flooding; and if he will make that information available. [1225]

  Mr. Kynoch
  Developments on low-lying land adjacent to rivers face an inherent risk of flooding, however small. The assessment of this risk is primarily for developers and owners and a national planning policy guideline, planning and flooding, has been published to ensure that this is fully taken into account in the planning process. Strathclyde regional council, and the port authority jointly commissioned a study in 1988 of the possible effects of dredging operations reducing in line with the needs of the port. This concluded that this would have little effect on the risk of fluvial or tidal flooding but might lead to operational concerns for sewerage systems.

  Tourism
  Mr. Simon Coombs
  To ask the Secretary of State for Scotland if he will make a statement on the state of the tourism industry in Scotland. [770]

  Mr. Kynoch
  Tourism is a major contributor to the Scottish economy. My right hon. Friend has made clear his commitment to the industry. I am pleased to say that all the signs are that the industry has done well in 1995. In the first seven months alone, tourism trips to Scotland from within the United Kingdom were up by 24 per cent. over the same period last year, bednights up 32 per cent. and spend up by 15 per cent. Overseas trips to the UK as a whole also rose substantially and I expect Scotland to show a similar position. This success is underpinned by substantial Scottish Office support for tourism, through the Scottish tourist board and the enterprise agencies. We intend to continue to support the industry in its efforts to become still more competitive.
  170

  Local Government Reorganisation
  Mr. Stewart
  To ask the Secretary of State for Scotland on what basis he will determine the allocation of borrowing consents to the new unitary authorities in 1996–97 and 1997–98; and if he will make a statement. [778]

  Mr. Kynoch
  On the basis of relative needs and inherited legal commitments.

DEFENCE

  Public Interest Immunity Certificates
  Mr. Cohen
  To ask the Secretary of State for Defence if he will list all those in his Department who have authority to issue public interest immunity certificates; how many such certificates have been issued in each of the last five years; and what were the main reasons for them. [1432]

  Mr. Soames
  Ministers alone sign public interest immunity certificates in this Department. Since April 1992 the total number of PII certificates signed remains as stated in my answer of 16 October 1995 to the hon. Member for Clwyd, South-West (Mr. Jones),Official Report, columns 27–28. In the event, not all the certificates have been used. They cover a number of individual subjects, including the screening of certain members of the armed forces from the public at various criminal or civil proceedings and the protection of certain information from disclosure.

  Chemical and Biological Defence Establishment
  Mr. Livingstone
  To ask the Secretary of State for Defence how many of the extramural contractors to the chemical and biological defence establishment, Porton Down, have agreed to allow disclosure of their contractual relationship with CBDE, in line with CBDE's open government initiative. [1593]

  Mr. Arbuthnot
  This is a matter for the Defence Evaluation Research Agency under its framework document. I have asked the chief executive, DERA, to write to the hon. Member.

  Letter from John Chisholm to Mr. Ken Livingstone, dated 22 November 1995:
  Your Parliamentary Question to the Secretary of State for Defence asking how many extramural contractors have agreed to allow disclosure of their contractual relationship with the Chemical and Biological Defence Establishment, Porton Down has been passed to me to reply as the Chief Executive of the Defence Evaluation and Research Agency which includes CBDE as one of its divisions.Forty four of our extramural contractors have agreed to their contractual relationship with CBDE being disclosed to the public. They include university departments and industrial companies.I hope this information is helpful.
  Mr. Livingstone
  To ask the Secretary of State for Defence what specific measures have been implemented by the chemical and biological defence establishment to make it more open about its current activities. [1594]

  Mr. Arbuthnot
  This is a matter for the Defence Evaluation Research Agency under its framework document. I have asked the chief executive, DERA, to write to the hon. Member.
  171
  Letter from John Chisholm to Mr. Ken Livingstone, dated 22 November 1995:
  Your Parliamentary Question to the Secretary of State for Defence asking what specific measures have been implemented by the Chemical and Biological Defence Establishment to make it more open about its current activities has been passed to me to reply as the Chief Executive of the Defence Evaluation and Research Agency which includes CBDE as one of its divisions.CBDE places a high degree of importance on publicising the work it carries out to protect the UK Armed Forces from the threat presented by chemical and biological weapons. The staff at CBDE have always published the results of their work in technical journals and represented CBDE at scientific conferences. While it was an autonomous Next Steps Agency CBDE also provided four full Annual Reports and Accounts detailing its activities. These will continue in future under the auspices of DERA. In addition CBDE encourages visits from all interested parties and has welcomed members of parliament and representatives from local and district councils, schools, universities and the local and national media.I hope this information is helpful.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for Defence how his Department publicises payment practices other than as percentages of invoices paid late. [950]

  Mr. Arbuthnot
  The payment of the vast majority of the Department's bills and those of its agencies is a matter for the chief executive of the Defence Accounts Agency. The Defence Evaluation and Research Agency is responsible for paying its own bills. I have asked the chief executives of these agencies to reply.

  Letter from P. J. Trevelyan to Mrs. Barbara Roche, dated 22 November 1995:
  You asked the Secretary of State for Defence how his Department publicises payment practices other than as percentages of invoices paid late. As Chief Executive of the Defence Accounts Agency I have been asked to reply.All new MOD contractors receive a 'Prompt Payment Guide' and billing timetable from the Liverpool payment office. This booklet provides guidance on MOD payment procedures to help contractors submit bills correctly and therefore receive prompt payment. Contractors are invited to submit bills fortnightly in accordance with the timetable. Information about payment arrangements over Christmas and Easter is printed on the remittance advice notes which detail payments made. Details of payment schedules are also published widely throughout MOD.Because the MOD payment targets are key targets for the Defence Accounts Agency they are published in the Agency's Corporate Plan. Performance against the targets is published in the Agency's Annual Report and the House of Commons Official Report. The agreed target for financial year 1995/96 is to pay 97% of bills within 11 days of receipt at Liverpool, and all within 30 days. Currently the 11 day target is being achieved, and 99.99% is being achieved for the 30 day target.
  Letter from John Chisholm to Mrs. Barbara Roche, dated 22 November 1995:
  You asked the Secretary of State for Defence how his Department publicises payment practices other than as percentages of invoices paid. I am replying for the Defence Evaluation and Research Agency.Details of payment practices are included in the terms and conditions of contracts sent to suppliers. Additionally we are preparing a new booklet, to be published shortly, that is intended to assist companies in doing business with DERA. This will include a section on our bill paying policies.I hope this is helpful.172
  Mrs. Roche
  To ask the Secretary of State for Defence what is the average length of time it takes for his Department to pay invoices. [935]

  Mr. Arbuthnot
  The payment of the vast majority of the Department's bills and those of its agencies is a matter for the chief executive of the Defence Accounts Agency. The Defence Evaluation and Research Agency is responsible for paying its own bills. I have asked the chief executives of these agencies to reply.

  Letter from P. J. Trevelyan to Mrs. Barbara Roche, dated 22 November 1995:
  You asked the Secretary of State for Defence what is the average length of time it takes for his Department to pay invoices. This matter falls to me, as Chief Executive of the Defence Accounts Agency for reply. This statistic is not recorded locally and could only be provided at disproportionate cost.The statistics which are readily available to the Liverpool payment office go back two and a half years. During this time 99.99% of bills have been paid within 30 days of presentation of a valid invoice. The Liverpool payment office also measures its performance against a higher departmental standard of payment within 11 days of receipt of a valid invoice. It achieved its 1993/94 target of 96%, and its 1994/95 target of 97%. It has also achieved its 1995/96 target of 97% so far this financial year.Some low value bills are paid locally throughout MOD, but information about these is not held centrally and could only be provided at disproportionate cost.
  Letter from John Chisholm to Mrs. Barbara Roche, dated 22 November 1995:
  You asked the Secretary of State for Defence what is the average length of time it takes for his Department to pay invoices. I am replying for the Defence Evaluation and Research Agency.As I said in my earlier reply of 1 November 1995, virtually all validated invoices are paid within 9 days of being received by our bill paying section.I hope this is helpful.

  Mines
  Mr. Flynn
  To ask the Secretary of State for Defence what is his Department's rationale underlying the procurement of the future anti-personnel scatterable mine; [1072]

  (2) what is his Department's policy for replacing the Ranger scatterable anti-personnel mine system; [1071]

  (3) what progress has been made on the future anti-personnel scatterable mine system; and when it is intended to replace the Ranger system. [1073]

  Mr. Arbuthnot
  I refer the hon. Member to my reply to the hon. Member for South Shields (Dr. Clark) on 19 October 1995,Official Report, column 352.

  Mr. Flynn
  To ask the Secretary of State for Defence from which supplier his Department has decided to procure the vehicle-launched scatterable mine system. [1078]

  Mr. Arbuthnot
  A final decision has yet to be taken.

  Mr. Flynn
  To ask the Secretary of State for Defence (1) what is the current progress of the "mines in the new century" programme; [1070]
  173
  (2) what is the entry into service date for the Barmine replacement. [1075]

  Mr. Arbuthnot
  Current plans are to introduce a pattern anti-tank mine system—"mines in the new century"—that will replace the Barmine system in the first decade of the next century. However, we are currently considering our future requirements for this nature of weapon and no firm decisions have been taken. Any new mines introduced into service would have a self-neutralising or self-destruct capability and would fully meet the requirements of the international laws of armed conflict.

  Mr. Flynn
  To ask the Secretary of State for Defence if his Department intends to order the aimed controlled effect anti-tank mine. [1077]

  Mr. Arbuthnot
  We are currently engaged in a development programme with France and Germany for the aimed controlled effect anti-tank mine. A decision concerning a production order will be made at the end of this phase and in the light of our continuing review of requirements for anti-tank mines.

  Mr. Flynn
  To ask the Secretary of State for Defence when the British armed forces last deployed anti-personnel mines in a tactical role; if this minefield was marked; when was it neutralised; and by whom. [1069]

  Mr. Soames
  It is not our practice to comment on the operational deployment of mines. The armed forces use all mines responsibly and in accordance with the laws of armed conflict to minimise the danger both to civilians and our own forces. In particular, all minefields are recorded and they are marked when appropriate. Wherever practicable, the UK armed forces have cleared mines which they have laid, once they were no longer needed.

  Arms Exports (Iraq)
  Mr. Cohen
  To ask the Secretary of State for Defence on what dates his Department was informed of contracts relating to(a) Project Babylon, (b) Baby Babylon and (c) super-gun propellant; and what was the response of his Department. [997]

  Mr. Arbuthnot
  I refer the hon. Member to the memorandum presented by the Ministry of Defence to the Trade and Industry Select Committee in February 1992, HC86-xv. These are matters which are under investigation by Sir Richard Scott's inquiry. It would not be appropriate for me to comment further until Sir Richard has reported.

  Ministerial Transport, London
  Mr. MacShane
  To ask the Secretary of State for Defence how many times in the last year he used(a) the London Underground and (b) London Buses while on official business. [417]

  Mr. Portillo
  None on Ministry of Defence business.

  Jordan Defence Package
  Mr. Cohen
  To ask the Secretary of State for Defence on what date his Department was made aware of allegations of fraud, involving(a) Royal Ordnance, (b) BMARC and (c) Astra in the Jordan defence package;
  174
  and what response was made by his Department to these allegations. [1031]

  Mr. Arbuthnot
  Allegations of corruption involving Royal Ordnance and the Astra group of companies were made to the Ministry of Defence police in early 1990 and investigations began on 1 February 1990. They were not linked to the Jordan defence package. Any investigation into breaches of export control is a matter for HM Customs and Excise.

  Harrier GR7
  Mr. Gapes
  To ask the Secretary of State for Defence how many Harrier GR7s are presently available in service to the RAF. [366]

  Mr. Soames
  The RAF's Harrier GR7 operational fleet comprises 45 aircraft establishment and two in-use reserve.

  Private Finance Unit
  Mr. John Spellar
  To ask the Secretary of State for Defence what was the cost of the MOD private finance unit in the last year; and how many staff are employed in the unit. [52]

  Mr. Arbuthnot
  It is expected that the cost of the MOD private finance unit will be about £240,000 in 1995–96. Seven staff are employed in the unit: five civil servants and two private sector appointees.

  Operation Deliberate Force
  Mr. Gapes
  To ask the Secretary of State for Defence how many of the(a) laser-guided bombs and (b) 1,000 lb free fall bombs dropped by the RAF during Operation Deliberate Force hit their targets; how many of each type of bomb hit each of the targets which were hit by RAF aircraft; and how many of each type of bomb failed to hit a target. [369]

  Mr. Soames
  The information is not available in the form requested. Nineteen targets were assigned to be attacked with laser-guided bombs, and 43 of the 48 bombs which were dropped are assessed to have been successful. All 19 targets were either destroyed or severely damaged. Eight targets were assigned to be attacked with 30 1,000 lb free-fall bombs, but it is more difficult to assess the success of these weapons as other NATO aircraft attacked the same targets. However, it is assessed that there were three direct hits.

  Mr. Gapes
  To ask the Secretary of State for Defence what is the definition of hitting a target and the circular error probable for each of the types of munition used in Operation Deliberate Force. [370]

  Mr. Soames
  The definition of hitting a target varies with the objective of a mission, the type of weapon and the nature of the target. Information about the circular error probable for the weapons used in Operation Deliberate Force is classified.

  Jaguar GR1B Aircraft
  Mr. Gapes
  To ask the Secretary of State for Defence how many Jaguar GR1B aircraft are presently available in service to the RAF. [364]
  175
  Mr. Soames
  Seven Jaguar GR I B aircraft are currently in RAF service.

  Royal Ordnance (Police)
  Mr. Cohen
  To ask the Secretary of State for Defence what employer or contractual relationship exists between British Aerospace Royal Ordnance and the Ministry of Defence police. [988]

  Mr. Soames
  This matter is under review. The Ministry of Defence police are employed at five British Aerospace-owned Royal Ordnance plc sites. The greater part of the cost of their services is repaid to the Ministry by the company under the terms of an agreement made in 1985.

  Racism
  Mr. Cohen
  To ask the Secretary of State for Defence what recent allegations of racism within the armed forces have been communicated to his Department; what action he has taken in respect of them; and if he will make a statement. [318]

  Mr. Soames
  Since 1 January 1995, three incidents of alleged racism have been reported in the Army and three in the Royal Air Force. Disciplinary action has been recommended in one case; the remaining five cases are still under investigation. There have been no cases reported in the Royal Navy.

  Racial abuse or discrimination is not tolerated in the armed forces. Complaints of racial discrimination are investigated and, if proven, appropriate action is taken against the offenders.

  A code of practice on race relations in the armed forces has been enforced throughout the services since December 1993.

  International Military Services Ltd
  Mr. Cohen
  To ask the Secretary of State for Defence which members of his Department are on the board of International Military Services. [1022]

  Mr. Arbuthnot
  International Military Services Ltd. is a company wholly owned by the Secretary of State for Defence. No serving member of his Department is on the board of that company.

  Low Flying
  Mr. Redmond
  To ask the Secretary of State for Defence if military aircraft are permitted to exceed the speed limits for the United Kingdom low flying system when within weapons range danger areas. [424]

  Mr. Soames
  No.

  Mr. Foulkes
  To ask the Secretary of State for Defence how many complaints about low flying have been received from the area formerly covered by the southern part of the Prestwick-Glasgow avoidance area since 7 November 1994. [1282]

  Mr. Soames
  My Department has received approximately 40 complaints and inquiries about military low flying since 7 November 1994 from the area formerly covered by the southern part of the Glasgow-Prestwick avoidance area.
  176
  Mr. Foulkes
  To ask the Secretary of State for Defence what is the minimum permitted altitude for air combat manoeuvring raining over the United Kingdom. [1284]

  Mr. Soames
  The minimum permitted altitude for air combat manoeuvring training over the United Kingdom is 5,000 ft above ground level.

  Former Yugoslavia
  Mrs. Ewing
  To ask the Secretary of State for Defence how many British military personnel have been killed or wounded in the course of military operations in the former Yugoslavia; and how many of those casualties were as a result of blue on blue incidents relating to non-hostile troops. [1503]

  Mr. Soames
  Eighteen British service personnel have been killed and a further 39 have sustained serious injuries in the course of military operations in the former Yugoslavia None of these casualties resulted from "blue on blue" incidents.

  RAF (Total Quality Management)
  Mr. Foulkes
  To ask the Secretary of State for Defence what plans he has to introduce the total quality management system to Royal Air Force flying operations. [1278]

  Mr. Soames
  The RAF continually strives for excellence in all its flying operations, and in doing so embraces and keeps under review relevant aspects of the philosophy associated with total quality management systems.

  Danger Areas
  Mr. Foulkes
  To ask the Secretary of State for Defence if he will list the military activities permitted in each of the danger areas D411, D509, D606, D608 and D609. [1302]

  Mr. Soames
  The danger areas specified are used for the following purposes:

  Danger Area

  Location

  Usage

  D411

  Port Patrick

  Trials of Sonobuoy Equipment

  D509

  Campbeltown

  Anti-Air and Surface Shoots

  D606

  Forth Area

  Live Anti-Submarine Warfare Depth Charge and Mortar firings

  D607

  Forth Middle

  Surface firings; sleeve shoots; radar trials and air to air firings

  D608

  Forth Outer

  Surface firings; sleeve shoots; radar trials and air to air firings

  D609

  St. Andrews

  Radar training buoy

  Trident
  Mr. Foulkes
  To ask the Secretary of State for Defence what research is being undertaken into the feasibility of adapting the Trident system to carry conventionally armed missiles; and what has been the expenditure on this research in the last three years. [1291]

  Mr. Arbuthnot
  The UK has conducted no such research.
  177

  Sliac Air Base, Slovakia
  Mr. Foulkes
  To ask the Secretary of State for Defence how many United Kingdom personnel visited Sliac air base in Slovakia in September 1995. [1307]

  Mr. Soames
  Two United Kingdom service personnel visited the Sliac air base in September 1995, under the auspices of the Vienna document of 1994.

  Exercise Purple Star
  Mr. Foulkes
  To ask the Secretary of State for Defence if he will make a statement on plans for Exercise Purple Star in 1996. [1299]

  Mr. Soames
  This exercise will take place in spring next year on the eastern seaboard of America. It is the UK's major field training exercise for 1996 and involves over 15,000 personnel from all three services.

  RAF (Self-authorising Status)
  Mr. Foulkes
  To ask the Secretary of State for Defence what instructions are given to Royal Air Force commanders concerning the frequency with which the self-authorising status of aircrew under their command must be reviewed; and what formal examination or test is conducted to assess the suitability of aircrew to retain self-authorising status. [1279]

  Mr. Soames
  The self-authorising status of aircrew is approved by the station commander of each flying unit. There are no specific instructions concerning the frequency with which this must be reviewed, nor is any formal test conducted specifically to assess the aircrew's suitability to retain the status. However, all aircrew undergo a continual assessment of their ability to perform their duties including, where appropriate, their suitability to retain self-authorising status.

  Nuclear Weapons Safety Adviser
  Dr. Lynne Jones
  To ask the Secretary of State for Defence if he will make a statement about the work of the nuclear weapons safety adviser since his appointment. [1567]

  Mr. Soames
  Details of the nuclear weapons safety adviser's current and planned programme of work have been provided to the Select Committee on Defence and are contained in its 1995 report on progress of the Trident programme, pages 24 and 25, a copy of which is available in the Library of the House.

  Chemical and Biological Defence Agreements
  Mr. Livingstone
  To ask the Secretary of State for Defence if he will place in the Library copies of the annexes which have been added to the 1980 memorandum of understanding on chemical and biological defence between the United States of America, the United Kingdom and Canada in November 1988, October 1989, October 1991 and June 1994. [1584]

  Mr. Arbuthnot
  It is not our practice to place copies of memoranda of understanding or their annexes in the Library.
  178
  Mr. Livingstone
  To ask the Secretary of State for Defence on what dates amendments to the 1980 memorandum of understanding on chemical and biological defence between the United States of America, the United Kingdom and Canada were first notified to Parliament; and on what date the memorandum was last amended. [1585]

  Mr. Arbuthnot
  It is not our practice routinely to notify amendments to memoranda of understanding to Parliament. The memorandum of understanding on chemical and biological defence between the United States of America, the United Kingdom and Canada was last amended on 21 November 1994.

  Flying Training, Slovakia
  Mr. Foulkes
  To ask the Secretary of State for Defence what communications he has received from the Slovak authorities concerning the use of Slovak airspace for Royal Air Force training; and what response he has made to the Slovak authorities. [1306]

  Mr. Soames
  None since the meeting in February 1995 between my right hon. and learned Friend the then Secretary of State for Defence and the Slovakian Defence Minister, referred to in my answer of 8 March to the hon. Member for Don Valley (Mr. Redmond),Official Report, column 254. However, we continue to explore with the Slovak authorities military training opportunities for the United Kingdom in the region.

  Overseas Training Costs
  Mr. Foulkes
  To ask the Secretary of State for Defence what was the additional cost to the defence budget, other than direct payments to the Canadian authorities, of training Tornado crews at Canadian forces base, Goose Bay in each year since 1990. [1310]

  Mr. Soames
  The total costs in £millions of running the RAF unit at CFB Goose Bay since 1991 are in the table. Figures for 1990 are not readily available.

  Year

  RAF unit running cost

  1991–92

  2.096

  1992–93

  2.456

  1993–94

  3.103

  1994–95

  3.453

  1995–96

  3.292

  Any other costs to the defence budget, other than direct payments to the Canadian authorities, are not held centrally and could be provided only at disproportionate cost.

  Mr. Foulkes
  To ask the Secretary of State for Defence what payments have been made to the United States and Canadian authorities for Royal Air Force use of training facilities centred on(a) Nellis air force base, Nevada, (b) Cold Lake, Alberta and (c) Eielson air force base, Alaska, in each year since 1990. [1309]

  Mr. Soames
  Payments to the United States authorities for use of training facilities at Nellis air force base, Nevada and Eielson air force base, Alaska are as follows:
  179

  Nellis

  Eielson

  $

  $

  FY 1991–92

  25,000.00

  —

  FY 1992–93

  111,684.65

  143,175.75

  FY 1993–941

  365,609.92

  354,308.33

  FY 1994–951

  462,127.82

  907,402.00

  FY 1995–961

  130,441.85

  417,011.43

  1 Because of US billing procedures, the accounts for these years remain open and further payments may be made against them.

  The figures for 1990–91 are no longer available for either of the US locations, nor are the 1991–92 figures for Eielson air force base. No payments have been made to the Canadian authorities for use of training facilities at Cold Lake, Alberta.

  British American Community Relations Committees
  Mr. Foulkes
  To ask the Secretary of State for Defence if he will make a statement on the functions and budgets of the Anglo/Scottish/Welsh-American community relations committees; what is the current membership of each; and what is the process by which individuals are appointed to these bodies. [1297]

  Mr. Soames
  The function of these committees, now known as British American community relations committees, is to promote friendship and understanding between the US service personnel and civilian components, their dependants, and the British communities amongst whom they live. The only cost to the Department of these committees are certain out-of-pocket expenses for chairmen and administrative support provided by MOD-employed community relations advisers. Membership of the committees includes a chairman, who is appointed by my noble Friend the Under-Secretary of State for Defence, the US commander who acts as co-chairman, and, where applicable, a community relations adviser and an RAF commander. Also serving on the committees are a number of British civilians and US service personnel, selected by the chairman and co-chairman respectively.

  Area Defence Weapon
  Mr. Flynn
  To ask the Secretary of State for Defence when the area defence weapon is due to enter service. [1074]

  Mr. Arbuthnot
  Current plans are to introduce an area defence weapon in the first decade of the next century. However, we are currently considering our future requirements for this nature of weapon and no firm decisions have been taken. Any such weapon introduced into service would have a self-destruct or self-neutralising capability and would fully meet the requirements of the international laws of armed conflict.

  Multiple-Launch Rockets
  Mr. Flynn
  To ask the Secretary of State for Defence when the multiple-launch rocket system phase 2 warheads, ordered by Germany in August 1991, are due to be delivered to his Department. [1076]

  Mr. Arbuthnot
  The British Army is currently taking delivery of the multiple launch rocket system phase 2—AT2—rocket ordered by Germany and the United 180
  Kingdom in August 1991. Deliveries of the United Kingdom's offtake of phase 2 rockets are planned to be completed in early 1996.

  Empty Dwellings
  Mr. Jamieson
  To ask the Secretary of State for Defence how many dwellings owned by his Department are currently unoccupied in the counties of(a) Hampshire, (b) Lancashire and (c) Avon; and how many dwellings owned by his Department have been unoccupied for six months or more in each of these counties. [1222]

  Mr. Soames
  As at 30 September 1995, my Department owned the following empty dwellings in the counties named:

  Hampshire: 1,152

  Lancashire: 25

  Avon: 93

  Information on properties unoccupied for six months or more is not held centrally and could be provided only at disproportionate cost.

  Mr. Jamieson
  To ask the Secretary of State for Defence how many dwellings owned by his Department are currently unoccupied; and how many dwellings owned by his Department have been occupied for six months or more. [1336]

  Mr. Soames
  As at 30 September 1995, my Department owned 14,098 vacant dwellings, of which 13,898 were service families quarters and 200 were MOD civilian houses. Of these, 3,202 vacant service quarters and 55 civilian houses were in the process of being sold. The majority of the remainder of the service quarters were either awaiting major maintenance work, held for unit deployments, already allocated to service families due to move in shortly or formed part of the management margin needed to ensure that accommodation is available to house entitled service personnel. The majority of the vacant civilian houses could not be disposed of for security reasons. Information on properties unoccupied for six months or more is not held centrally and could be provided only at disproportionate cost.

  From the total of 13,898 empty properties, a further number of houses is being identified for future disposal.

  European Procurement Co-operation
  Dr. David Clark
  To ask the Secretary of State for Defence what plans he has to discuss European procurement collaboration with his French and German colleagues; and if he will make a statement. [1340]

  Mr. Arbuthnot
  Discussions continue with my French and German colleagues in a variety of forums, both on specific projects and on general European equipment collaboration issues. In particular, my Department is currently involved in discussions on the possible establishment of a European armaments agency and on the prospects for participation by the UK in the planned Franco-German armaments co-operation structure.

  Arcadia Land Plc
  Dr. David Clark
  To ask the Secretary of State for Defence if the Arcadia Land company has expressed an interest in being involved in the privatisation or sale of
  181
  surplus defence married quarters; and if he will make a statement. [1341]

  Mr. Soames
  Dr. David Hart, the independent adviser to my right hon. Friend the Secretary of State for Defence, is a director of Arcadia Land plc. As I made clear in my answer of 27 January,Official Report, column 445, no independent adviser assisting in the way ahead in a transfer of ownership of the married quarters estate will be permitted to have a financial stake in the outcome of the transaction. Arcadia Land plc has not made any expression of interest in respect of the disposal of surplus married quarters under the existing system.

  Army Pay
  Dr. David Clark
  To ask the Secretary of State for Defence what is the average cost to the public funds per annum for each member of the British Army. [1646]

  Mr. Soames
  This information can be provided only at disproportionate cost. However, it is possible to quantify the Regular Army's current annual pay bill on an average basis. Including all members of the home service full-time element of the Royal Irish Regiment and the non-regular permanent staff of the Territorial Army, the figure for pay, earnings-related national insurance contributions, allowances and superannuation equates to £23,300 per person. This figure takes no account of variation attributable to rank or other factors and costs.

  Ballistic Missiles
  Dr. David Clark
  To ask the Secretary of State for Defence if he will publish the feasibility study by the Defence Research Agency into a domestically produced ballistic missile interceptor; and if he will make a statement. [1647]

  Mr. Arbuthnot
  No. The Defence Research Agency is carrying out work related to ballistic missile defence. Its reports are classified and it would not be appropriate to publish them.

  Ministry of Defence Police
  Dr. David Clark
  To ask the Secretary of State for Defence (1) if he will publish the results of his Department's study into the future of the Ministry of Defence police; [1648]

  (2) what estimate he has made of the numbers to be employed in the Ministry of Defence police in each of the next five years; and if he will make a statement. [1649]

  Mr. Soames
  The overall manpower requirements of the Ministry of Defence police are kept under constant review. We will shortly be consulting the staff associations and trade unions concerned about proposals resulting from a number of studies on defence police and guarding requirements. Consultative documents will be put to them. I shall be sending copies to the House of Commons Defence Committee and to the hon. Members with particular consistency interests. I shall also place copies in the Library of the House.
  182

  Organisation for the Prohibition of Chemical Weapons
  Mr. Livingstone
  To ask the Secretary of State for Defence whether the Government plan at the appropriate time to make available to the public details of the declaration to the Organisation for the Prohibition of Chemical Weapons. [1608]

  Mr. Arbuthnot
  Yes. Details of UK's declarations required under the chemical weapons convention will be made available to the public when they are passed to the Organisation for the Prohibition of Chemical Weapons.

EDUCATION AND EMPLOYMENT

  Student Loans
  Mr. Steinberg
  To ask the Secretary of State for Education and Employment what is the average debt of students on completion of their studies. [181]

  Mr. Forth
  The appropriate average debt to the Student Loans Company of borrowers who entered repayment status on 1 April 1995 was £1,415.

  Mr. Bryan Davies
  To ask the Secretary of State for Education and Employment what plans she has to use the national insurance system to collect repayments of student loans. [1466]

  Mr. Forth
  The Government have no plans to use the national insurance system for this purpose.

  Mr. Davies
  To ask the Secretary of State for Education and Employment if she will list the financial institutions with which her Department has had discussions regarding reforms of the student loans scheme; and which of these has indicted interest in involvement in any new scheme. [1465]

  Mr. Forth
  Officials have had, and are continuing to have, discussions with a number of banks and building societies on this subject. Given the commercial nature of these discussions, it is not appropriate to say, at this stage, which institutions officials are talking to, nor which have expressed an interest.

  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Education and Employment if she will estimate for each year since 1992 in constant prices the average level of indebtedness of university and college students; and if she will make a statement. [628]

  Mr. Forth
  Information on total student indebtedness is not collected centrally.

  Public Interest Immunity Certificates
  Mr. Cohen
  To ask the Secretary of State for Education and Employment if she will list all those in her Department who have authority to issue public interest immunity certificates; how many such certificates have been issued in each of the last five years; and what were the main reasons for them. [1391]

  Mr. Forth
  A claim to public interest immunity relating to departmental documents or information is normally made by the appropriate Minister.

  There was one case in 1991 and one in 1992 in which a certificate was used inter partes in proceedings.
  183
  The certificates were issued in respect of advice by Her Majesty's inspectorate of schools and officials in the context of appeals under section 8(6) of the Education Act 1981 in order to protect the confidentiality of full and frank advice given to my right hon. Friend the Secretary of State.

  Youth Training (Accidents)
  Mr. Heppell
  To ask the Secretary of State for Education and Employment how many accidents and fatalities have occurred involving people placed on youth training schemes each year since youth training began in 1983. [977]

  Mr. Paice
  The following table gives the total GB fatal, major and minor accident figures for youth training and its predecessor programme6s from 1983–84 to 1994–95.

  Total youth training accident statistics (GB) from 1983–84 to 1994–95

  Fatal

  Major

  Minor

  1983–84

  4

  100

  843

  1984–85

  5

  184

  1,748

  1985–86

  2

  222

  1,913

  1986–87

  12

  326

  1,761

  1987–88

  8

  509

  2,541

  1988–89

  8

  573

  2,729

  1989–90

  4

  548

  2,495

  1990–91

  4

  457

  1,925

  1991–92

  2

  344

  1,597

  1992–93

  1

  290

  1,362

  1993–94

  4

  287

  1,579

  1994–95

  1

  283

  1,473

  Notes:

  1. Department for Education and Employment figures for youth trainees are compiled on a similar basis to those prepared by the Health and Safety Executive for employed persons. However, the Department's figures include a number of accidents to trainees in educational establishments and road traffic accidents which would not have been reportable to HSE had the individuals been employed.

  2. Major injuries are classified according to the severity criteria laid down in the Reporting of Injuries, Diseases and Dangerous Occurrence Regulations 1985 (RIDDOR).

  3. The former "Youth Training Scheme" commenced in April 1983 and was succeeded by Youth Training in April 1990.

  School Inspections
  Mrs. Anne Campbell
  To ask the Secretary of State for Education and Employment what reimbursement is made to schools whose teachers spend time away from their own school while undertaking Ofsted school inspections elsewhere. [22]

  Mr. Robin Squire
  These are matters for Her Majesty's chief inspector of schools, who heads the Office for Standards in Education. I have asked Mr. Chris Woodhead to write to the hon. Member.

  Higher Education Contribution Scheme
  Mr. Bryan Davies
  To ask the Secretary of State for Education and Employment if she will make an assessment of the Australian Government's higher education contribution scheme. [1582]

  Mr. Forth
  This Australian scheme requires students in higher education to contribute to the cost of their tuition at university either through cash payments during their study or through repayments over time after graduation.
  184

  Physical Education Teachers
  Mr. Pendry
  To ask the Secretary of State for Education and Employment what is her estimate of the number of physical education teachers who have been made redundant since 1992. [1470]

  Mr. Robin Squire
  Data on which to base such an estimate are not available.

  Assisted Places Scheme
  Mr. Walden
  To ask the Secretary of State for Education and Employment to what proportion of places in existing private schools it is her policy to extend the assisted places scheme. [1626]

  Mrs. Gillan
  We will shortly be announcing our detailed plans for expanding the assisted places scheme, including arrangements for inviting eligible schools to bid for new places.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for Education and Employment how many orders and firms are represented by the 5 per cent. of invoices not paid by her Department within 30 days or in accordance with contractual agreements in 1994–95; and how many of these are related to firms with fewer than 500 employees. [942]

  Mr. Forth
  A total of 6,419 invoices were sampled in four separate prompt payment of bills exercises during 1994–95. The result showed that 332 of these invoices were paid late—5 per cent. of the sample. The Department does not hold information on the number of employees in the companies involved.

  Mrs. Roche
  To ask the Secretary of State for Education and Employment what is the amount owed to those businesses whose invoices were not paid within 30 days in each of the last five years. [1079]

  Mr. Forth
  The Department does not maintain separate records of the sums involved when invoices were not paid within 30 days. The information could be provided only at disproportionate cost.

  Mrs. Roche
  To ask the Secretary of State for Education and Employment how her Department publicises payment practices other than as percentages of invoices paid late. [955]

  Mr. Forth
  The Department publicises information on its prompt payment performance in the departmental report. The Department's contracts branch, leading buying units and purchasing sections, when negotiating contracts, inform suppliers of goods and services of the standard payment terms including the complaint procedure when negotiating contracts if the Department fails to pay on time.

  Mrs. Roche
  To ask the Secretary of State for Education and Employment what is the average length of time it takes for her Department to pay invoices. [933]

  Mr. Forth
  The Department does not have statistical information on the average time taken for the payment of invoices. Under an internal service level agreement, invoices are processed within five working days of receipt by the finance directorate. The Department is committed
  185
  to meeting the objective of the Confederation of British Industry's prompt payment code to pay all valid invoices within 30 days of their receipt.

  Staffing
  Mr. Byers
  To ask the Secretary of State for Education and Employment how many staff her Department employs on a regional basis in each standard English region: what is the cost of running these regional operations: what is the total budget for each region in 1994–95; and what are the main purposes for which each budget is used. [267]

  Mr. Paice
  The information is not available in the form requested. The new Department for Education and Employment was created on 5 July 1995. The following information relates to the current financial year.

  Table 1 gives the information requested for Department for Education and Employment staff working in, and budgets delivered through, Government offices for the regions.

  Table 1: Government offices

  Region

  Staff in Post1

  Running Costs2 £ million

  Programme Budgets2 £ million

  South east

  54.5

  2.2

  174.9

  London

  68

  3.2

  215.1

  Eastern

  46.5

  1.9

  138.5

  South west

  59.5

  2.1

  136.7

  West Midlands

  71.5

  2.6

  174.2

  East Midlands

  55.6

  1.8

  134.4

  Yorkshire and Humberside

  64.6

  2.2

  197.7

  Merseyside

  41

  1.4

  212.3

  North west

  78.5

  2.9

  88.6

  North east

  62

  2.1

  146.7

  Notes:

  1As at 1 November 1995.

  2Provision for 1995–96.

  The main purposes for which these budgets are used are adult and youth training programmes, vocational education programmes and the provision of careers advice.

  Table 2 gives information for the Employment Service. The ES has different regional boundaries to the Government office network.

  Table 2: Employment services

  Region

  Staff in Post1

  Running Costs2 £ million

  Programme Budgets2 £ million

  Northern

  2,228

  46.3

  8.9

  Yorkshire and Humberside

  3,420

  68.6

  12.6

  East Midlands and eastern

  3,520

  72.4

  14.1

  London and South east

  11,652

  265.8

  56.1

  South west

  3,131

  64.6

  12.4

  West Midlands

  3,564

  75.1

  15.8

  North west

  4,798

  99.2

  19.8

  Notes:

  1As at 1 April 1995.

  2Provision for 1995–96.
  186
  The main purposes for which these budgets are used are on employment measures to help people into work, placement and advisory services, employment services for people with disabilities and administering the payment of unemployment benefit.

  The Department carries out its headquarters functions in London, Darlington, Sheffield and Runcorn.

  Training and Enterprise Councils
  Mrs. Roche
  To ask the Secretary of State for Education and Employment if he will list the members of the board for each TEC stating which members have experience of running small businesses. [948]

  Mr. Paice
  A list showing private sector board members of each English TEC, and approximate company size, has been placed in the Library. Where the employee figure is shown as 0, the information has not been collected. No information is held about the experience of board members prior to joining their current company.

  A complete list of all TEC board members is held in the Library. It is updated quarterly.

  Mrs. Roche
  To ask the Secretary of State for Education and Employment how much money each TEC earmarked in each of the last five years for small businesses. [943]

  Mr. Page
  I have been asked to reply.

  Information on how much money each TEC earmarked in each of the last five years for small firms is not available centrally. This is because the funding which TECs use to support small businesses comes from a number of different sources including their own surpluses. Government funding for small businesses is available through TECs and business links from the DTI, Departments for Education and Employment and Environment and TECs can also draw on European funds to assist small firms.

  Placing Assessment and Counselling Teams
  Mr. Wallace
  To ask the Secretary of State for Education and Employment if she will list the main locations of the placing assessment and counselling teams which provide employment and advisory services for employers and people with disabilities in Scotland. [298]

  Mr. Forth
  Responsibility for the subject of the question has been delegated to the Employment Service agency under its chief executive. I have asked him to arrange for a reply to be given.

  Letter from M. E. G. Fogden to Mr. James Wallace, dated 22 November 1995:
  The Secretary of State has asked me to reply to your question about the main locations of the Placing Assessment and Counselling Teams (PACT) in Scotland.
  A list of PACTs in Scotland is attached (Annex A). Orkney and Shetland are covered by the Highlands, Islands and Grampian PACT, each of which has an identified Employment Service member of staff who offers support to disabled people in Jobcentres in Kirkwall and Lerwick. In addition, full time Disability Employment Advisors based in Aberdeen visit employers and clients on the islands.
  I hope this is helpful.
  187

  Annex 1: PACTs—Office for Scotland

  Address

  Telephone and Fax

  Glasgow east, north and

  Tel: 0141–248 7654

  Lanarkshire

  Fax: 0141–248 8388

  Employment Service

  Pact 3rd Floor

  221 West George Street

  G2 2ND

  Glasgow west, south, Renfrew

  Tel: 0141–226 4923

  and Dumbarton

  Fax:0141–248 8312

  Employment Service

  PACT

  2nd Floor

  221 West George Street

  Glasgow

  G2 2ND

  Edinburgh and South east

  Tel: 0131–229 9321

  Scotland

  Fax:0131–221 9860

  Employment Service

  PACT

  5th Floor

  Torphichen Street

  Edinburgh

  EH3 8JP

  South west Scotland

  Tel: 01563 542000

  Employment Service

  Fax: 01563 573079

  PACT

  17 Grange Street

  Kilmarnock

  KA1 2DF

  Highlands, Islands and

  Tel: 01463 239171

  Grampian (outstation in

  Fax: 01463 715699

  Aberdeen)

  Outstation Tel: 01224 622050

  Employment Service

  Outstation Fax: 01224 630644

  PACT

  4th Floor

  Metropolitan House

  31–33 Hight Street

  Inverness

  IV1 1J

  Central and West Lothian

  Tel: 01324 621444

  Employment Service

  Fax: 01324 638968

  PACT

  8–14 High Street

  Falkirk

  FK1 1EY

  Tayside and Fife

  Tel: 01382 223222

  Employment Service

  Fax: 01382 201350

  PACT

  132 Seagate

  Dundee

  DD12HB

  Mr. Wallace
  To ask the Secretary of State for Education and Employment what information she has on the number of people in(a) Orkney and (b) Shetland who have made contact through their local job centre with the placing assessment and counselling teams in each year since the establishment of PACTs in 1992. [299]

  Mr. Forth
  Responsibility for the subject of the question has been delegated to the Employment Service agency under its chief executive. I have asked him to arrange for a reply to be given.

  Letter from M. E. G. Fogden to Mr. James Wallace, dated 22 November 1995:
  The Secretary of State has asked me to reply to your question about the number of people in Orkney and Shetland who have made contact through their local Jobcentre with the Placing Assessment and Counselling Teams (PACTs).
  188
  We do not record the number of people referred by Jobcentres to PACTs. However we do record the number of people, who need and may benefit from specialist help, who are assessed by PACTs.
  Assessment is the process through which PACTs help disabled job seekers identify potential occupation or training establish whether they are job-ready, or need further preparation for work. Its purpose is to identify employment potential and needs, and to come to agreement about how to meet the individual needs of clients. It is based mainly on Employment Service (ES) provision supplemented by small numbers of external contracts. An individual action plan is agreed between the client and the ES setting out what work or training a client will look for and include any preparatory action they will need to take.
  All clients referred to PACTs have an in-depth assessment interview or interviews with a Disability Employment Adviser (DEA). If this does not result in their being able to identify a suitable occupation or training, they may then be offered additional practical methods to help them decide. This can include functional testing, psychometric testing, an interview with an occupational psychologist or provided with enhanced assessment from specialist contractors.
  From the first full year after they were introduced, the number of people assessed by PACTs on Orkney and Shetland were 122 for the 12 months to April 1994 and 156 for the same period to April 1995. The number of people assessed for the first six months of the current financial year was 108. As the introduction of PACTs was a gradual process, the numbers of assessments for 1992/93 were not recorded.
  I hope this is helpful.

  Kirklees Local Education Authority
  Mrs. Peacock
  To ask the Secretary of State for Education and Employment how much was spent in total on school education in Kirklees in each year since 1974 at constant prices. [1337]

  Mr. Robin Squire
  The following table shows, at 1993–94 prices, the expenditure on pre-primary, primary and secondary education by Kirklees local education authority from 1974–75 to 1993–94, the latest year for which figures are available. These figures have not been adjusted for any changes of function.

  Kirklees: Gross expenditure on school education 1993–94 prices

  Year

  £ million

  1974–75

  105.95

  1975–76

  100.88

  1976–77

  99.35

  1977–78

  93.43

  1978–79

  95.29

  1979–80

  93.30

  1980–81

  98.50

  1981–82

  101.25

  1982–83

  100.95

  1983–84

  98.98

  1984–85

  100.83

  1985–86

  102.70

  1986–87

  109.63

  1987–88

  112.72

  1988–89

  117.55

  1989–90

  119.37

  1990–91

  115.73

  1991–92

  110.90

  1992–93

  132.76

  1993–94

  113.55

  Mrs. Peacock
  To ask the Secretary of State for Education and Employment how much was spent in total on education in Kirklees in each year since 1974 at constant prices. [1338]
  189
  Mr. Squire
  The following table shows, in 1993–94 prices, the expenditure by Kirklees local education authority from 1974–75 to 1993–94, the latest year for which figures are available. These figures have not been adjusted for any changes of function.

  Kirklees: Gross Expenditure 1993–94 Prices

  Year

  £ million

  1974–75

  190.40

  1975–76

  185.80

  1976–77

  186.25

  1977–78

  182.23

  1978–79

  184.58

  1979–80

  186.43

  1980–81

  187.96

  1981–82

  192.16

  1982–83

  192.53

  1983–84

  190.61

  1984–85

  191.22

  1985–86

  196.31

  1986–87

  210.86

  1987–88

  219.34

  1988–89

  223.28

  1989–90

  196.38

  1990–91

  194.70

  1991–92

  195.07

  1992–93

  201.43

  1993–94

  174.98

  Mrs. Peacock
  To ask the Secretary of State for Education and Employment if she will set out the changes in real terms for education spending for each sector in Kirklees since 1980. [1339]

  Mr. Squire
  The increase in expenditure by Kirklees local education authority on pre-primary and primary education and secondary education, between 1979–80 and 1993–94, the latest year for which outturn figures are available, is as follows.

  Kirklees LEA: Net recurrent expenditure, real terms

  Year

  Pre-Primary and Primary Education £000

  Secondary Education £000

  1979–80

  37,756

  46,029

  1993–94

  63,921

  62,046

  Increase

  26,165 (40.9 per cent.)

  16,017 (25.8 per cent.)

  Unemployment, Durham
  Mr. Steinberg
  To ask the Secretary of State for Education and Employment how many people under the age of 25 years in the City of Durham constituency are unemployed and are in receipt of benefit; and how many of these are long-term unemployed. [156]

  Mrs. Angela Knight
  I have been asked to reply.

  In October 1995, there were 937 people aged under 25-year-old claiming unemployment-related benefits—unemployment benefit, income support or national insurance credits. Of these, 168 had been unemployed for over one year.

  Labour Statistics
  Mr. Battle
  To ask the Secretary of State for Education and Employment what were the(a) median, (b) highest
  190
  and (c) lowest decile earnings of full-time workers on adult rates, distinguishing between male and female and manual and non-manual, in (i) Yorkshire and Humberside, (ii) the north of England and (iii) the United Kingdom in each year since 1993. [1459]

  Mrs. Angela Knight
  I have been asked to reply.

  Information on the median, quartiles and deciles of weekly and hourly earnings of full-time workers in the regions of Great Britain is shown in table 116 of part E of the new earnings survey reports. Copies of these reports are available in the Library.

  Mr. Battle
  To ask the Secretary of State for Education and Employment what were the current average earnings of part-time workers on adult rates, distinguishing between manual and non-manual in(a) Yorkshire and Humberside, (b) West Yorkshire, (c) South Yorkshire, (d) North Yorkshire, (e) Humberside, (f) the north of England and (g) the United Kingdom. [1457]

  Mrs. Knight
  I have been asked to reply.

  Information available from the new earnings survey is provided in the following table.

  Average Weekly Earnings for part-time workers on adult rates, pay not affected by absence

  Region

  Non manual £

  Manual £

  Yorkshire and Humberside

  112.50

  78.70

  West Yorkshire

  117.80

  79.90

  South Yorkshire

  112.50

  74.60

  North Yorkshire

  1—

  1—

  Humberside

  105.10

  1—

  North of England

  109.50

  74.80

  Great Britain

  118.80

  80.80

  1 Not available because sample size too small to give a reliable estimate.

  Mr. Dobson
  To ask the Secretary of State for Education and Employment what is(a) the number and (b) the proportion of (i) manual part-time workers and (ii) non-manual part-time workers broken down into men and women working less than eight hours a week and 16 hours a week. [1487]

  Mrs. Knight
  I have been asked to reply.

  Estimates from the labour force survey are shown in the table.

  Part-time manual and non-manual workers by the total number of hours they usually work—Great Britain, spring 1995

  Working less than 8 hours a week

  Working less than 16 hours a week

  Thousand

  Per cent.

  Thousand

  Per cent.

  Men

  Manual part-time

  107

  20

  253

  47

  Non manual part-time

  104

  19

  292

  54

  Women

  Manual part-time

  319

  16

  953

  48

  Non manual part-time

  353

  12

  1,093

  36

  191

AGRICULTURE, FISHERIES AND FOOD

  Bovine Offals
  Mr. Sykes
  To ask the Minister of Agriculture, Fisheries and Food what was the outcome of the State Veterinary Service's surveillance of the handling of special bovine offals in September and October; and if he will make a statement. [2310]

  Mr. Douglas Hogg
  In September, the State Veterinary Service reported unannounced visits to 193 slaughterhouses and found failings in the handling of specified bovine offals in 92 to 48 per cent.—of them. In October the SVS reported visits to 153 slaughterhouses and found failings in 52 to 34 per cent. Many of the failings found were of a comparatively mild nature, for example reflecting teething troubles with the new stain. There were, however, some more serious problems, for example with the poor separation and storage of SBO material. This risks such material becoming mixed with other waste products which can then enter the animal feed chain. In the most serious cases we found small pieces of spinal cord, ranging in size from 1 cm to one third of the spinal cord, left attached to the carcases after dressing. So far, we have found 17 such instances, including one found during preliminary visits in the summer and five found up to 10 November and one on 20 November in the latest round of visits. Although in each instance the spinal cord was removed before the carcases left the premises, these were potentially serious failings. It is essential that we eliminate any prospect of SBO material entering the human food chain.

  I view this most seriously and have therefore taken a number of steps to ensure that slaughterhouses fully comply with the requirements of the Specified Bovine Offal Order 1995. First, I have discussed the situation with the chief executive of the Meat Hygiene Service and he will ensure that his staff enforce the requirements of the order most rigorously. Secondly, where it has sufficient evidence, the Meat Hygiene Service will prosecute any slaughterhouse operator failing to meet his obligations under the SBO order. A number of prosecutions are already under consideration. Thirdly, I have asked the SVS to double the frequency of its unannounced surveillance visits to cattle slaughterhouses and head boning plants. Finally, I met representatives of slaughterhouse operators on 9 November to impress on them the need for full compliance with these controls. They assured me of their commitment to seeing the requirements fully met, and I welcomed their constructive response.

  The SVS also visits knackeries and hunt kennels to monitor their compliance with the SBO controls. In September, it made unannounced visits to 212 such premises and found failings in the handling of SBOs in 137 of them—65 per cent. In October, the SVS visited 235 hunt kennels and knackeries and found failings in 70 to 29 per cent. Again, many of the failings found were of a comparatively mild nature. Hunt kennels and knackeries do not handle meat for human consumption; nevertheless, failings in the handling of SBOs at such premises could result in such material entering the animal feed chain. This is of concern. My hon. Friend the Parliamentary Secretary has, therefore, met representatives of hunt kennels and knackeries to impress on them too the need to comply
  192
  fully with the controls on SBOs. She welcomed the constructive response from the respective representative organisations.

  Bovine Spongiform Encephalopathy
  Mr. Sykes
  To ask the Minister of Agriculture, Fisheries and Food which bovine tissues are known to transmit BSE infectivity and at what stages in the animal's life they are infectious; and if he will make a statement. [2311]

  Mr. Douglas Hogg
  A large number of tissues from cattle known to be naturally infected with BSE have been tested to determine whether they can transmit disease when inoculated intra-cerebrally and intra-peritoneally into susceptible strains of mice. Recent results have shown that two further tissues, the retina and the terminal spinal cord, can transmit BSE infectivity to mice, as well as those tissues already identified that can contain BSE infectivity, the brain and the cervical spinal cord. Infectivity had also been detected in the distal ileum of calces which has been experimentally challenged with BSE; this was first announced in an answer given to my hon. Friend the Member for Woodspring (Dr. Fox) by my right hon. Friend the Member for Norfolk (Mrs. Shephard) on 30 June 1994,Official Report, column 657–58. These new findings do not require any changes to the regulations concerning BSE. Both the retina and terminal spinal cord are already covered by the Specified Bovine Offal Order 1995. They have to be removed from all cattle over six months at slaughter and are destroyed. Such tissues are thereby prevented from entering the human and animal food chains.

  In addition to the above tissues, a large number of other tissues from cattle affected with BSE have been tested to see if they can transmit the disease to mice. Tests on the following tissues have been negative:

  Abomasum

  Bone marrow

  Buffy coat

  Cauda equina

  Cerebrospinal fluid

  Clotted blood

  Distal colon

  Proximal colon

  Epididymis

  Foetal calf blood

  Heart

  Distal small intestine

  Proximal small intestine

  Liver

  Lung

  Kidney

  Lymph nodes:

  Prefemoral

  Mesenteric

  Retropharyngeal

  Supramammary

  Midrum fat

  Milk

  Muscles:

  Musculus (M.) semitendinosus

  193

  M. diaphragma

  M. longissimus

  masseter

  Oesophagus

  Omasum

  Pancreas

  Peripheral nerves:

  N. splanchnic

  N. sciaticus (proximal)

  N. tibialis

  Placental cotyledon

  Placental fluids:

  Allantoic fluid

  Amniotic fluid

  Prostate

  Rectum

  Reticulum

  Rumen (oesophageal groove)

  Rumen (pillar)

  Semen

  Seminal vesicle

  Serum

  Skin

  Spleen

  Testis

  Tonsil

  Udder

  Uterine caruncle (pregnant cow)

  We are also carrying out experiments to look at the way in which infectivity develops in different tissues over time. Four-month-old calves were fed infected brain from cattle with BSE. Animals were slaughtered at intervals subsequently and a large number of their tissues tested on each occasion to see if they could transmit the disease in mice. Animals developed clinical signs of BSE from 35 months after challenge onwards.

  So far, we have obtained complete results on the tissue assays of animals slaughtered at two, six, 10 and 14 months after challenge. At two months, no tissue showed infectivity. From six months onwards the distal ileum—part of the small intestine—shows BSE infectivity. No other tissue tested, including the brain, spinal cord and thymus, has shown any infectivity in animals up to 14 months after challenge. Infectivity has also been detected in the ileum of animals killed 18 months after challenge, but assays of other tissues from these cattle are not yet complete.

  These results support the existing precautionary controls on specified bovine offals. These require the intestines and thymus to be removed from all animals on slaughter and be destroyed. The brain, spinal cord, spleen and tonsils have to be removed from all cattle over six months old on slaughter and destroyed.

  Dr. Strang
  To ask the Minister of Agriculture, Fisheries and Food how many United Kingdom farms have had at least one case of BSE. [1520]

  Mr. Hogg
  A total of 34,064 farms have had at least one case of BSE.
  194
  Dr. Strang
  To ask the Minister of Agriculture, Fisheries and Food how many cases of BSE were confirmed in the United Kingdom in each year from 1986 to the latest available date. [1522]

  Mr. Hogg
  Bovine spongiform encephalopathy was first identified in November 1986. Information on the incidence of the disease prior to this date is not recorded.

  The following is a table of the number of confirmed cases of BSE in the United Kingdom up to 17 November 1995. The cases prior to 21 June 1988 in Great Britain and 29 November 1988 in Northern Ireland when the disease was made notifiable, are recorded by year of clinical onset of disease and the cases thereafter are recorded by year of restriction.

  Year

  Number

  1986

  7

  1987

  435

  1988 (pre-notification)

  286

  1988 (post-notification)

  2,187

  1989

  7,166

  1990

  14,294

  1991

  25,202

  1992

  37,057

  1993

  34,830

  1994

  24,289

  1995

  11,031

  Dr. Strang
  To ask the Minister of Agriculture, Fisheries and Food, what percentage of(a) United Kingdom dairy herds, (b) United Kingdom beef suckler herds and (c) total United Kingdom herds have experienced at least one case of BSE. [1519]

  Mr. Hogg
  As at 17 November 1995, 50.5 per cent. of United Kingdom dairy herds and 12.6 per cent. of beef herds have experienced at least one case of BSE. 29.5 per cent. of the total United Kingdom herds have experienced at least one case of BSE.

  Dr. Strang
  To ask the Minister of Agriculture, Fisheries and Food how much money was spent by the Government in respect of BSE on(a) research, (b) slaughter, (c) compensation and (d) disposal of carcases in (i) 1993, (ii) 1994 and (iii) 1995 to the latest available date. [1521]

  Mr. Hogg
  The following table shows the amount spent in respect of compensation and disposal for the financial years 1993–1994, 1994–95, and 1995–96 up to 31 October 1995. It is not possible without disproportionate cost to calculate slaughter costs separate from the other costs of field work by the State Veterinary Service. Euthanasia is predominantly carried out by veterinary officers who are already present on farm for the purpose of carrying out clinical examination of suspects, although occasionally it may require a separate visit.

  Years

  Compensation

  Disposal

  1993–94

  37,468,085

  8,753.603

  1994–95

  20,138,239

  5,552,494

  1995–96

  6,012,476

  1,952.019

  Includes estimates for Northern Ireland.

  195
  The following amounts were spent on BSE research in the finanacial years:

  1993–94:£5,688,000

  1994–95:£5,433,000

  1995–961:£2,447,000

  1995–962:£5,174,000

  1 To 31 October

  2 Commitment.

  Mink and Arctic Foxes
  Mr. Heppell
  To ask the Minister of Agriculture, Fisheries and Food what provision exists at present for local authorities to protect people and domesticated animals from attacks by mink and arctic fox. [894]

  Mrs. Browning
  Mink and arctic foxes may be killed or taken by owners and occupiers of land if they feel that this is necessary to prevent damage, provided that the method used does not contravene current legislation, such as the Wildlife and Countryside Act 1981 and the Control of Pesticides Regulations 1986. General advice on pest control is available from the local offices of ADAS, the Ministry's wildlife advisers.

  Mr. Heppell
  To ask the Minister of Agriculture, Fisheries and Food how many mink and arctic fox are known to have escaped or been released from fur farms from 1990–91 to 1994–95. [895]

  Mrs. Browning
  The Ministry has received no reports of any mink or arctic foxes known to have been released or have escaped from fur farms in the period since 1990.

  Mr. Heppell
  To ask the Minister of Agriculture, Fisheries and Food what advice he received from the Farm Animal Welfare Council on the listing of mink and arctic fox under the Dangerous Wild Animals Act 1976. [893]

  Mrs. Browning
  In 1994, the Farm Animal Welfare Council recommended that consideration be given to the inclusion of American mink, Arctic fox and racoon dog in the schedule to the Dangerous Wild Animals Act 1976. After consulting interested organisations my colleagues and I concluded that this, being a general approach, would not offer any welfare advantages to the species concerned. General protection for the welfare of animals farmed for their fur is already provided by the Agriculture (Miscellaneous Provisions) Act 1968 and its subordinate regulations. Any more specific requirements must, in our view, be introduced on a European basis.

  A copy of the letter sent to interested organisations explaining our views more fully, dated 24 August 1995, has been placed in the Library of the House.

  Ostrich Farms
  Mr. Morley
  To ask the Minister of Agriculture, Fisheries and Food how many prosecutions have been made against owners of ostrich farms in the last three years; and if he will make a statement. [1015]

  Mrs. Browning
  The information requested is not recorded centrally.

  Mr. Morley
  To ask the Minister of Agriculture, Fisheries and Food how many live ostrich chicks were imported(a) in 1994 and (b) to date. [1016]
  196
  Mrs. Browning
  The only information available to the Ministry on imports from other member states is derived from the ANIMO system—which is provisional and subject to change, and relates to all ostriches—adults, chicks and hatching eggs. Information on imports from third countries is derived from quarantine reports and relates to day-old ostrich chicks.

  Origin

  1994

  1995 to date

  Other Member States

  620

  843

  Third Countries

  267

  193

  Mr. Morley
  To ask the Minister of Agriculture, Fisheries and Food how many visits the State Veterinary Service has made to ostrich farms to check the condition of ostriches in the last three years. [1014]

  Mrs. Browning
  The information is not available for the full period requested. Since 1 April 1994, 23 welfare inspections of ostrich farms in Great Britain have been made by the State Veterinary Service.

  Fish Quotas
  Mr. Austin Mitchell
  To ask the Minister of Agriculture, Fisheries and Food what proposals he has to introduce transferable quotas for fish. [980]

  Mr. Baldry
  I have asked the fishing industry to let me have its ideas for alternative quota management arrangements and will consider any suggestions made that appear to be practicable and command widespread support within the industry.

  Mr. Austin Mitchell
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the New Zealand system of fish quota allocation; and if he will make a statement. [981]

  Mr. Baldry
  The New Zealand system of fisheries quota management was developed to meet a very different set of circumstances from those applying within the European Union. I am nevertheless sure that the United Kingdom industry is aware of arrangements in New Zealand and other countries and will take these into account in formulating its response to my invitation for suggestions for changes in our own arrangements.

  Pigs
  Mr. Morley
  To ask the Minister of Agriculture, Fisheries and Food (1) how many piglets have been(a) tail docked and (b) tooth clipped in the last 12 months; and if he will make a statement. [1019]

  (2) what has been the change in the number of piglets which have been (a) tail docked and (b) tooth clipped since 10 August 1994. [1018]

  Mrs. Browning
  Figures on the number of piglets which have been tail docked and tooth clipped are not available.

  The Welfare and Livestock Regulations 1994 (SI 2126) require that tail docking and tooth clipping of piglets may be carried out only when there is evidence, on the farm, that injuries to sows' teats or to other piglets have occurred or are likely to occur as a result of not carrying

  197
  out these procedures. Where tooth clipping appears necessary, this must be carried out within seven days of birth.

  Mr. Morley
  To ask the Minister of Agriculture, Fisheries and Food how many visits his officials have made to pig farms since 10 August 1994 to ensure compliance with paragraph 3 of part iv of schedule 3 to the Welfare of Livestock Regulations 1994. [1017]

  Mrs. Browning
  Since 1 July 1994, 1,204 welfare inspections of pig farms in Great Britain have been made by the State Veterinary Service.

  In the course of these inspections, an assessment of compliance with all the requirements of schedule 3 to the Welfare of Livestock Regulations will be made. This will include, where appropriate, compliance with part IV of that schedule which relates specifically to piglets.

  Barley
  Mr. Austin Mitchell
  To ask the Minister of Agriculture, Fisheries and Food what the levels of United Kingdom intervention stocks of barley were in each month since November 1994; and what the intervention price was in each month. [159]

  Mr. Baldry
  The information requested is as follows:

  Month

  Physical stock of barley at month end '000 tonnes

  Intervention price £/tonnes

  December 1994

  976

  103.94

  January 1995

  820

  105.08

  February 1995

  732

  106.23 1st

  107.59 17th

  108.40 21st

  March 1995

  559

  109.57 1st

  109.78 6th

  111.66 16th

  112.83 26th

  April 1995

  521

  114.04 1st

  114.48 15th

  114.93 25th

  June 1995

  477

  108.25

  July 1995

  357

  100.59

  August 1995

  260

  100.59

  September 1995

  195

  100.59

  October 1995

  139

  100.59

  Mr. Austin Mitchell
  To ask the Minister of Agriculture, Fisheries and Food what quantities of barley have been supplied to Spain from United Kingdom intervention stocks during 1995; and what costs were paid to the Intervention Board for the movements. [157]

  Mr. Baldry
  The quantity of United Kingdom intervention barley sold during 1995 for delivery to Spain was 249,996 tonnes. The quantity delivered to Spain is subject to final confirmation by the Spanish authorities after allowing for normal handling and transport losses.

  The range of successful bid prices for purchase of the barley ex-store in the UK and delivery into store in Spain was £103.01 to £106.01 per tonne.

  Arable Area Payments Scheme
  Mr. Tipping
  To ask the Minister of Agriculture, Fisheries and Food what was the average payment made 198
  under the arable area payments scheme in England in 1994. [1066]

  Mr. Baldry
  The average payment made in 1994 was £18,870.

  Mr. Tipping
  To ask the Minister of Agriculture, Fisheries and Food how many payments under the arable area payments scheme were made in England in excess of £1 million in 1994. [1065]

  Mr. Baldry
  For reasons of confidentiality, it is not possible to identify separately the number of payments above £1 million.

  Mr. Tipping
  To ask the Minister of Agriculture, Fisheries and Food if he will list by county the number of payments made under the arable area payments scheme in excess of £75,000 in 1994. [1067]

  Mr. Baldry
  For reasons of confidentiality, it is not possible to identify separately the number of payments above £75,000. However, in England a total of 2,096 claims fell into this category.

  Mr. Tipping
  To ask the Minister of Agriculture, Fisheries and Food if he will list the area, the number and amount paid in each county in England under the set-aside element of the arable area payments scheme in 1994. [1062]

  Mr. Baldry
  Information is not available for amounts paid relating solely to the set-aside element on a county basis. However, the table gives the total area, number and amount claimed in 1994 for set-aside on land situated in each county of England. The total payment made will have been slightly lower because of reductions for various reasons.

  Arable area payments scheme: set-aside element 1994

  County

  Area of set-aside (HA)

  Number of claims including set-aside

  Amount claimed (£)

  Avon

  2,437

  190

  830,892

  Bedfordshire

  10,073

  459

  3,434,375

  Berkshire

  6,223

  227

  2,116,950

  Buckinghamshire

  9,666

  508

  3,289,813

  Cambridgeshire

  30,112

  1,526

  10,251,643

  Cheshire

  3,477

  323

  1,183,774

  Cleveland

  2,419

  163

  824,755

  Cornwall

  4,807

  480

  1,627,689

  Cumbria

  1,178

  110

  401,637

  Derbyshire

  4,610

  367

  1,563,249

  Devon

  8,119

  795

  2,759,979

  Dorset

  9,207

  439

  3,133,659

  Durham

  6,554

  438

  2,194,686

  East Sussex

  5,508

  289

  1,868,057

  Essex

  29,415

  1,261

  10,017,752

  Gloucestershire

  13,218

  659

  4,482,792

  Greater London

  835

  48

  275,827

  Greater Manchester

  838

  69

  284,010

  Hampshire

  17,948

  623

  6,117,982

  Hereford and Worcester

  14,257

  1,109

  4,848,630

  Hertfordshire

  11,182

  431

  3,812,146

  Humberside

  30,857

  1,626

  10,496,444

  Isle of Wight

  1,497

  86

  508,695

  Kent

  18,212

  806

  6,162,305

  Lancashire

  2,283

  225

  775,999

  199

  Arable area payments scheme: set-aside element 1994

  County

  Area of set-aside (HA)

  Number of claims including set-aside

  Amount claimed (£)

  Leicestershire

  15,263

  791

  5,177,304

  Lincolnshire

  51,608

  2,238

  17,558,853

  Merseyside

  1,496

  135

  510,059

  Norfolk

  35,467

  1,890

  12,062,761

  North Yorkshire

  32,216

  2,150

  10,944,791

  Northamptonshire

  17,169

  755

  5,809,082

  Northumberland

  13,798

  666

  4,701,340

  Nottinghamshire

  14,343

  799

  4,871,815

  Oxfordshire

  18,287

  754

  6,234,927

  Shropshire

  11,906

  850

  4,059,334

  Somerset

  6,970

  569

  2,359,705

  South Yorkshire

  6,647

  386

  2,244,806

  Staffordshire

  7,106

  479

  2,416,303

  Suffollk

  29,918

  1,566

  10,153,449

  Surrey

  2,637

  132

  899,081

  Tyne and Wear

  1,439

  98

  485,511

  Warwickshire

  12,313

  677

  4,197,759

  West Midlands

  816

  65

  278,214

  West Sussex

  7,853

  370

  2,677,469

  West Yorkshire

  3,756

  259

  1,277,193

  Wiltshire

  18,945

  771

  6,420,744

  Total

  554,882

  29,657

  188,604,242

  Green Minister
  Ms Ruddock
  To ask the Minister of Agriculture, Fisheries and Food what were his reasons for deciding not to continue in his predecessor's role as the Green Minister within his Department. [243]

  Mr. Hogg
  My hon. Friend the Parliamentary Secretary, the Member for Daventry (Mr. Boswell) reports to me on all environmental matters. I have allocated the important role of Green Minister to him to ensure that the Ministry's environmental responsibilities receive the fullest possible attention and expertise.

  Staffing
  Mr. Byers
  To ask the Minister of Agriculture, Fisheries and Food how many staff his Department employs on a regional basis in each standard English region; what is the cost of running these regional operations; what was the total budget for each region in 1994–95; and what are the main purposes for which the budget is used. [268]

  Mr. Boswell
  I refer the hon. Member to the reply given to him by my hon. Friend the Member for Fylde (Mr. Jack) on 6 February 1995,Official Report, column 86, which provides the latest available relevant information.

TRADE AND INDUSTRY

  National Engineering Laboratory
  Mr. Anthony Coombs
  To ask the President of the Board of Trade what financial arrangements have been put in place with ASL consequent upon the transfer of the National Engineering Laboratory. [2273]
  200
  Mr. Ian Taylor
  Further to my reply to the hon. Member for Dover (Mr. Shaw) of 31 October,Official Report, column 211, the business and staff of the National Engineering Laboratory have now transferred to Assessment Services Ltd. A payment of £1.95 million was made to ASL on completion and there will be a further adjustment as set out in my earlier answer. Overall, these terms represent better value for money for my Department than the other bids received or the sale benchmark.

  Approval to this new service will be sought in a winter supplementary estimate for the Department of Trade and Industry's programmes and administration vote—class IV, vote 1. Pending that approval, urgent expenditure of £1.95 million has been met by repayable advances from the Contingencies Fund.

  EU Consumers Council
  Dr. Spink
  To ask the President of the Board of Trade if he will make a statement on the outcome of the EU Consumers Council held on 9 November. [2231]

  Mr. Jonathan Evans
  I represented the United Kingdom at the Council. Political agreement was reached on a compromise text on the comparative advertising directive. The text fully meets United Kingdom objectives and concerns.

  There was an orientation debate on the Commission's proposals for a new directive on unit-pricing—the requirement for retailers to indicate the price per unit of measurement. While welcoming the general thrust of the proposal as providing the consumer with an accurate and easily understood price comparison mechanism, I strongly argued that national Governments should be given discretionary power to exempt small shops from unit pricing, gaining support from a number of other member states. On grounds of subsidiarity, there was general support for allowing member states to determine on a national basis whether to exempt specific products from unit pricing; and the unit of measurement by which individual products should be unit priced.

  The Council passed a resolution welcoming the Commission's report on the operation of the consumer credit directive and inviting the commission to undertake further study before proposing any further initiatives in this area. It was also agreed that the Commission should undertake studies in co-operation with member states on consumer education and information and on miracle products.

  The Commission presented its paper on priorities for consumer policy 1996 to 1998, concentrating on financial services, public utilities, measures to enable the consumer to benefit from the information society, measures to improve consumer confidence in foodstuffs and to encourage sustainable consumption. These proposals will be subject to further consideration.

  Mr. Barnes
  To ask the President of the Board of Trade if he will make a statement on the outcome of the EU Consumers Council held on 19 November listing all votes, and all decisions which were determined by unanimity or without discussion. [438]
  201
  Mr. Evans
  [holding answer 20 November 1995]: My answer today to my hon. Friend the Member for Castle Point (Dr. Spink) covered the discussion points at the EU Consumers Council held on 9 November.

  The following decisions were adopted without discussion.
  Invocation of the urgency procedure for consultation of the European Parliament on a Council decision on the fourth medium-term Community action programme on equal opportunities for men and women; procedure for consultation with the European Parliament delaying the review of tasks by two years until the end of 1997, on developing the European Environment Agency's communication network and on participation of central and eastern European countries in agency's work programme; the recommendation for a Council decision on the participation of the EC in the negotiations on the amendments and adaptations of the Vienna convention and the associated protocol-Montreal protocol—on substances that deplete the ozone layer; and confirmation of replacement of various—non-British—members of the Committee of the Regions.

  All these decisions were reached by unanimity.

  Manufacturing Industry (Energy Use)
  Mr. Battle
  To ask the President of the Board of Trade what was the gross domestic product energy ratio for industry for each of the last 10 years. [1449]

  Mr. Page
  Figures for energy use, output and the energy ratio for the manufacturing industry are as follows:

  Indices (1990=100)

  Output of the manufacturing industry (at constant factor cost)1

  Energy use by the manufacturing industry2

  Energy ratio (energy use per unit of output)

  1985

  84.5

  110.5

  130.8

  1986

  85.6

  108.4

  126.7

  1987

  89.6

  106.3

  118.6

  1988

  95.9

  107.9

  112.5

  1989

  100.2

  100.9

  100.7

  1990

  100.0

  100.0

  100.0

  1991

  94.6

  97.2

  102.7

  1992

  94.0

  93.9

  99.9

  1993

  95.1

  93.8

  98.6

  1994

  99.2

  99.3

  100.1

  Source:

  1 Central Statistical Office.

  2 Excludes energy used by the manufacturing industry for transport.

  Electricity Supplies
  Mr. Battle
  To ask the President of the Board of Trade what assessment he has made of the extent to which electricity suppliers are fulfilling their obligations to maintain the service lead of wiring and equipment in the customer's premises up to the meter; and if he will make a statement. [1448]

  Mr. Page
  The statutory obligations on public electricity suppliers to maintain their service equipment in consumers' premises are set out in the Electricity Supply Regulations 1988, as amended.
  202
  These regulations are administered and enforced by the engineering inspectorate in the Department of Trade and Industry. The inspectorate monitors all incidents and accidents which must be reported to the Secretary of State under regulation 34 of these regulations.

  The inspectorate carries out inspections of suppliers' woks including those located on consumer's premises under section 30(2) of the Electricity Act 1989 and regulation 33 of the regulations.

  Energy Efficiency
  Mr. Battle
  To ask the President of the Board of Trade what progress has been made towards cutting energy consumption in Government buildings for which he has responsibility, in each year since 1990. [1451]

  Mr. Jonathan Evans
  The total energy consumption and consumption per square metre, as measured by the Government's published energy targets, of buildings for which DTI is responsible in each year since 1990, are as follows:

  Reduction from base year

  Year

  Total Consumption

  £/m2 Measure

  Total (Percentage)

  £/m2 (Percentage)

  1990–91

  209,559,185 KWh

  16.32

  —

  —

  1991–92

  194,033,233 KWh

  15.63

  7

  4

  1992–93

  171,852,414 KWh

  15.61

  18

  4

  1993–94

  176,834,148 KWh

  16.44

  16

  -1

  1994–95

  125,754,708 KWh

  15.55

  40

  5

  Monopolies and Mergers Commission
  Mrs. Beckett
  To ask the President of the Board of Trade how many matters have been referred by him to the Monopolies and Mergers Commission in each of the last 16 years. [1512]

  Mr. Jonathan Evans
  The number of references by category as at 21 November 1995 is as follows:

  Mergers1/Monopoly sections 78 and 79

  References under the Fair Trading Act

  References under section 11 of the Competition Act

  Year

  1973

  1980

  1979

  5

  2

  1

  —

  1980

  6

  —

  —

  3

  1981

  11

  —

  —

  1

  1982

  10

  —

  —

  5

  1983

  8

  —

  —

  3

  1984

  4

  —

  —

  3

  1985

  8

  —

  —

  6

  1986

  14

  —

  —

  3

  1987

  6

  —

  —

  4

  1988

  12

  —

  2

  1

  1989

  16

  —

  —

  1

  1990

  28

  —

  —

  2

  1991

  12

  —

  —

  2

  1992

  13

  1

  —

  —

  1993

  6

  —

  —

  1

  1994

  9

  —

  —

  —

  1995

  9

  —

  —

  —

  1 Including newspaper mergers.

  Mrs. Beckett
  To ask the President of the Board of Trade on how many occasions in each of the last 16 years the Office of Fair Trading advised reference to the Monopolies
  203
  and Mergers Commission; on how many occasions that advice was followed; and if he will list those occasions when that advice was not followed. [1513]

  Mr. Jonathan Evans
  Under the Fair Trading Act 1973, the Director General of Fair Trading advises my right hon. Friend the President of the Board of Trade whether to refer qualifying mergers to the Monopolies and Mergers Commission. The number of mergers on which the DGFT advised reference is as follows:

  1979: 5

  1980: 5

  1981: 8

  1982: 8

  1983: 9

  1984: 5

  1985: 6

  1986: 15

  1987: 6

  1988: 10

  1989: 15

  1990: 23

  1991: 8

  1992: 11

  1993: 5

  1994: 7

  1995: 9 (so far)

  The DGFT's advice to refer was followed in all cases except those detailed:

  1979

  Thorn/EMI

  Calor Gas Ltd/certain assets of South Western Gas Board (Glogas)

  1983

  Blue Circle/assets of Bristol Channel (Aberthaw)

  Dalgety/certain assets of Rank Hovis McDougall

  1984

  Nestle/Carnation

  1986

  Cannon/Screen Entertainment

  Owens Corning Fibreglass/certain assets of Pilkington

  1991

  BPB Industries/certain assets of Poliet Group

  1993

  GEC/Infra-Red business of Phillips

  Airtours/Owners Abroad

  1995

  Hasbro/Waddington Games

  North West Water/NORWEB

  Also earlier this year, the DGFT recommended that the Scottish and Newcastle/Courage merger should be referred to the MMC. I asked the DGFT to explore possible enforceable undertakings as an alternative to reference. The DGFT subsequently advised that undertakings should be accepted in lieu or reference; I agreed.

  In addition, my right hon. Friend the President of the Board of Trade referred one case each in 1982, and 1983, and four cases in 1990, against the advice of the DGFT not to refer.
  204

  Realising Our Potential Awards
  Mrs. Anne Campbell
  To ask the President of the Board of Trade how many applications for ROPA were received by the(a) Medical Research Council, (b) Biotechnology and Biological Sciences Research Council, (c) Engineering and Physical Sciences Research Council, (d) Particle Physics and Astronomy Research Council and (e) Economic and Social Research Council; how many were turned down in each case because of ineligibility; and how many were rejected. [20]

  Mr. Ian Taylor
  The following tables show the number of ROPAs received; the number awarded; the number turned down because of ineligibility; and the number rejected for each of he research councils.

  1994 ROPA pilot analysis of applications and awards by research council

  Research council

  Number of applications

  Number of awards

  Number ineligible

  Number rejected

  BBSRC

  82

  44

  4

  34

  EPSRC

  351

  158

  38

  155

  MRC

  134

  42

  2

  90

  Total

  567

  244

  44

  279

  1995 ROPA scheme analysis of applications and awards by research council

  Research council

  Number of applications

  Number of awards

  Number ineligible

  Number rejected

  BBSRC

  207

  116

  6

  85

  EPSRC

  398

  203

  50

  145

  ESRC

  46

  18

  13

  15

  MRC

  239

  100

  75

  64

  NERC

  64

  38

  12

  14

  PPARC

  2

  0

  1

  1

  Total

  956

  475

  157

  324

  British Aerospace Royal Ordnance
  Mr. Cohen
  To ask the President of the Board of Trade how much the Export Credit Guarantees Department has provided to British Aerospace Royal Ordnance since its privatisation. [994]

  Mr. Nelson
  On grounds of commercial confidentiality, ECGD does not publicise details of individual firms' business without their prior approval.

  Arms Sales (Nigeria)
  Mr. Cohen
  To ask the President of the Board of Trade how much the Export Credit Guarantees Department has provided for arms sales to Nigeria in the last five years. [995]

  Mr. Nelson
  The ECGD has provided no guarantees for arms sales to Nigeria during this period.

  Working Hours
  Mr. Jim Cunningham
  To ask the President of the Board of Trade what assessment his Department has made of the relative number of hours worked by employees in(a) the United Kingdom and (b) other EU countries. [1006]
  205
  Mr. Jonathan Evans
  The latest available figures are for 1993. The average usual hours worked a week by employees in the United Kingdom was 37.2, compared to an average of 37.1 for all the states that were members of the European Union at that time.

  Environmental Technology Industry
  Mr. Jim Cunningham
  To ask the President of the Board of Trade what plans he has to support the growth of the environmental technology industry. [1161]

  Mr. Page
  The Department of Trade and Industry will continue to work with the environmental industry, including technology suppliers, to improve its competitiveness in world markets. In particular, the joint environmental markets unit, established by the DTI and the Department of the Environment, is supporting the industry's efforts to exploit the substantial market opportunities which are being generated by rising environmental standards at home and overseas. It is assisting the industry to identify these opportunities and to raise its profile overseas. The unit is promoting collaboration between the various organisations representing the industry to achieve the co-ordinated response to environmental problems which world markets now demand; and it will work with the industry through the technology foresight process to address technological challenges for the future.

  Mr. Cunningham
  To ask the President of the Board of Trade what percentage of United Kingdom exports were generated by the environmental technology industry in each year since 1992–93. [1162]

  Mr. Ian Taylor
  There is no standard definition of "the environmental technology industry". United Kingdom exports of pollution control and monitoring equipment generated 0.4 per cent. of total exports in 1992, and 0.5 per cent. in 1993 and 1994.

  Using a definition of the environmental products industries as producing "a product which enhances or prevents the deterioration of the external environment", it is estimated that exports of all environmental products made up 0.8 per cent. of total UK exports in 1992. Estimates have not been made for later years.

  Deregulation
  Sir Michael Grylls
  To ask the President of the Board of Trade if he will list the deregulation measures agreed by his Department during the current year. [286]

  Mr. Lang
  Deregulation encompasses a wide range of activities to minimise burdens on business, including not only amendment and repeal of burdensome regulation but also scrutinising new regulations and encouraging business-friendly enforcement practices. Significant measures agreed by my Department this year can be found in "Deregulation: the Way Forward", presented by my right hon. Friend the President of the Board of Trade, 22 May 1995, and the Government response to the first annual report of the deregulation task force, September 1995. Both publications are available in the Library of the House.
  206

  Defence Export Licences
  Mr. Harvey
  To ask the President of the Board of Trade what applications for export licences to countries in the middle east for defence equipment have(a) been granted, (b) received and (c) discussed over the past year; and if he will make a statement. [627]

  Mr. Nelson
  Earlier this year, there were placed in the Library of the House detailed statistical analyses of export licences which were granted for military, paramilitary and security equipment in the calendar years 1993 and 1994. These analyses included all countries of destination for which these licences were issued, including middle east countries. Early in 1996, I intend to place in the Library of the House a similar analysis for the calender year 1995. I shall write to the hon. Member when this is done.

  As regards "applications received", this total is the sum of those which are granted and which are refused—other than those which lapse during their processing at the instigation of the applicant. Details of licences which were refused in 1993 and in 1994 were included in the Export Control Organisation's annual reports for those two years and copies of which have been placed in the Library of the House. As part of the task of statistical analysis for the year 1995, to which I have referred, I intend to include in the statistical report details of licences which were refused.

  I am not clear as to what further information the hon. Member is seeking when he asks which applications have been "discussed".

  All military, security and paramilitary goods and arms, ammunition and related material are controlled under the UK's export control legislation and cannot be exported without a licence from the Department of Trade and Industry. The Government observe strict responsibility over arms exports, primarily by means of considering applications for export licences against strict established criteria. These criteria include those which have been agreed with our European Union partners and in other international forums. We consider very carefully the political and military implications of allowing individual arms consignments to go overseas. We pay particular attention to proposed exports of military goods to countries with poor human rights records, where such goods might be used for internal repression, and to countries or regions where the export of arms might contribute to destabilisation of the area.

  The UK also observes arms embargoes imposed by the United Nations and the European Union on a number of countries. Individual decisions as to whether specific equipment should be exported to specific markets are therefore taken in the light of these internationally agreed commitments.

  Inward Investment
  Sir Wyn Roberts
  To ask the President of the Board of Trade what has been the value, at current prices, of inward investment to the United Kingdom during the last five years. [1398]

  Mr. Eggar
  Information on the topics is regularly published in "United Kingdom Balance of Payments—The Pink Book" and "First Release—Balance of Payments", both produced by the Central Statistical Office, copies of which are available in the Library of the House.
  207

  Consultancy Brokerage Service
  Mrs. Roche
  To ask the President of the Board of Trade what alternative uses have been found for the £1.37 million of the expenditure on the Consultancy Brokerage Service referred to in his answer of 23 October 1995,Official Report, column 420, which was spent on information technology hardware. [1125]

  Mr. Lang
  A number of the items have been redeployed within my Department, thus avoiding the need to purchase such equipment for the projects being set up in those areas. This redeployed equipment has a current book value—that is, cost minus 30 per cent depreciation per year—of £120,316. A small amount of hardware has been sold to the external contractors who were to have delivered the Consultancy Brokerage Service for an aggregate of £43,986. The remainder will now be offered for sale to other Government Departments, which is the normal procedure in the case of disposal of Government assets. Any items not utilised across the government estate will be offered for sale at auction, in line with Government accounting procedures.

  On further checking, I would now like to make it clear that the previous answer to which the hon Member refers—23 October 1995, Official Report, column 420—was incorrect. The sum of £1.37 million was the total amount spent on information technology development, of which £395,376 was spent on equipment.

  Skills Challenge
  Mrs. Roche
  To ask the President of the Board of Trade if he will list the firms which were awarded the small firms training challenge; and how much they were awarded. [944]

  Mr. Page
  The panel has selected 14 innovative projects, featuring almost 180 small firms, as award winners of the first stage of bids for the skills challenge, jointly funded by DTI and DFEE. The partnerships are as follows:

  3D Design—Marine Technology. Sponsored by Tyneside TEC

  Press and Mould Toolmaking. Sponsored by Lancashire Area West TEC (LAWTEC)

  "Office Team". Sponsored by Coventry and Warwickshire TEC

  "Makeover". 10 Ethnic Minority and Indigenous Independent Retailers. Sponsored by Hertfordshire TEC

  Lincolnshire Trainers' Network. Sponsored by Lincolnshire TEC

  "Micro-Business". Sponsored by London East TEC

  Clothing Companies. Sponsored by North London TEC

  Southampton Area Co-operative Development Agency (SACDA). Sponsored by Hampshire TEC

  "Forging Ahead". Sponsored by Milton Keynes and North Bucks Chamber of Commerce Training and Enterprise.

  "Schematic". Sponsored by Devon and Cornwall TEC

  Four sector bids have also received awards. These are:

  Engineering Training Authority (ENTRA) (Supplier Chain Performance)

  The Confederation of British Wool Textiles

  The Academy of Food and Wine

  Seafish Training

  208
  Projects will receive an average award of around £50,000. Contracts are currently being negotiated with the winning partnerships.

  Taxation (Self-assessment)
  Mrs. Roche
  To ask the President of the Board of Trade what discussions his Department has had with the Inland Revenue regarding the possibility of issuing computer software to aid self-assessment of tax liabilities. [946]

  Mr. Page
  The Inland Revenue plans to issue computer software to help those who have to prepare and submit a self-assessment tax return. There are two initiatives:

  (1) to provide tax software suppliers with the communications products required to enable agents to transmit returns electronically to the Inland Revenue, thus reducing costs and providing prompt, accurate processing of the return; and

  (2) to issue, on request, to those taxpayers who have a computer, a floppy disc which will help them prepare and print their return.

  The Inland Revenue has consulted widely in preparing these proposals. It has held discussions with the Department of Trade and Industry.

  Business Links
  Mrs. Roche
  To ask the President of the Board of Trade if he will publish the fee rates for advice given by each business link in the last year. [947]

  Mr. Page
  As private sector organisations, business links are responsible for determining their own pricing structures for advice and information in response to local customer needs and economic conditions. Fee rates charged by individual business links are not collated centrally, and could be provided only at disproportionate cost.

  Small Firms (British Standard)
  Mrs. Roche
  To ask the President of the Board of Trade what plans his Department has for a British standard for small firms. [949]

  Mr. Page
  This Department has no plans to introduce a British standard specific to small firms.

  Telephone Services, Dover
  Mr. David Shaw
  To ask the President of the Board of Trade if he will make it his policy that compensation will be payable to telephone users in respect of delays in the provision of competitive telephony services in the Dover and Deal area as a result of delays in starting and completing work on the Dover and Deal area franchise for cable television. [588]

  Mr. Ian Taylor
  The Telecommunications Act licence for the Dover cable TV franchise does not provide for financial penalties to be levied for any failure to meet build obligations.

  ISDN Services
  Mr. David Shaw
  To ask the President of the Board of Trade (1) what assessment he has made of the impact of the current pricing policy for ISDN lines in the United
  209
  Kingdom on the development of the information super-highways; [594]

  (2) if he will discuss with the Director General Telecommunications the current price levels of ISDN lines and the impact that such price levels are having on the development of the information super-highways. [589]

  (3) if he will examine the current prices for ISDN lines in the United Kingdom and in other countries; and what assessment he has made of the impact current price levels are having on the United Kingdom's international competitive position. [590]

  Mr. Ian Taylor
  The pricing of ISDN services and the extent to which they are available are matters for the commercial judgment of service providers. However, both my Department and the Office of Telecommunications are aware of some concerns about the level of relative prices of ISDN services in the UK compared to other countries. In some countries which have cheaper prices than the UK, the markets are not liberalised, so it is impossible to assess whether the prices charged reflect the true cost of providing the service. However, Oftel is considering the inclusion of ISDN services in BT's price cap when it is next reviewed.

  The introduction of effective niche competition will also bring prices down. The Government's policy of licensing alternative infrastructure such as radio fixed access systems should contribute to this. Operating at 10 GHz, these systems could provide an alternative ISDN service to that offered by BT and some cable providers.

  The provision of telecoms products and services makes a large direct contribution to national competitiveness. Liberalisation has also brought reductions in overall charges and the rapid development of advanced services and facilities, including ISDN, which boost competitiveness across all sectors.

  Use of the information super-highway is increasing rapidly, with the commercial sector making the largest contribution to that rate of growth. ISDN capacity at 64,000 bit is an important technology for the development of the information society, but is only one of the technological developments whose availability has encouraged greater exploitation of the Internet.

  Cable Television, Dover
  Mr. David Shaw
  To ask the President of the Board of Trade what assessment he has made of the progress of the cable television franchiser in the Dover-Deal area; and to what extent the progress to date meets the requirements of the franchise. [591]

  Mr. Ian Taylor
  Responsibility for monitoring and enforcing compliance with the build obligations contained in Bell Cablemedia's Telecommunications Act licence for its Dover franchise is a matter for the Director General of Telecommunications. I have therefore asked the director general to write to the hon. Member with details of progress made to date.

  Nuclear Energy
  Mr. Llew Smith
  To ask the President of the Board of Trade if he will make a statement on the implications for British Nuclear import and export policy of the extension 210
  of the US-Euratom co-operation agreement on the peaceful uses of nuclear energy, signed by the Commission in November, and if he will place in the Library a copy of the text of the extended co-operation agreement. [1576]

  Mr. Eggar
  The US-Euratom agreement for peaceful nuclear co-operation is intended to provide a secure basis for co-operation and trade between the nuclear industries of the two parties as well as a number of third countries, and provides a framework for this trade to expand in the future. The agreement will now go to the US Congress for its approval.

  Copies of the text of the agreement signed on 7 November will be placed in the Libraries of both Houses shortly when these become available from Brussels.

PRIME MINISTER

  Lockerbie
  Mr. Dalyell
  To ask the Prime Minister what response Her Majesty's Government have sent to the Libyan request that a trial takes place in The Hague under a Scottish judge, under Scottish rules of evidence, of the two Libyans accused of the bombing of Pan Am 103 over Lockerbie. [1632]

  The Prime Minister
  The Government of Libya have made no direct representation to us, but our position remains that there is no acceptable alternative to the trial taking place in Scotland or the United States.

  Libya
  Mr. Dalyell
  To ask the Prime Minister if he will discuss with the UN Security Council the ending of UN sanctions over Libya. [359]

  The Prime Minister
  The United Nations sanctions committee on Libya is today holding its 11th review of sanctions.

  Invoices
  Mrs. Roche
  To ask the Prime Minister (1) how his Department publicises payment practices other than as percentage of invoices paid late; [964]

  (2) what is the average length of time it takes for his Department to pay invoices. [924]

  The Prime Minister
  For this purpose, my Department is part of the Cabinet Office. I refer the hon. Member to the replies given today by my right hon. Friend the Chancellor of the Duchy of Lancaster.

  Energy Efficiency
  Mr. Battle
  To ask the Prime Minister what progress has been made towards cutting energy consumption in Government buildings for which he has responsibility, in each year since 1990. [1452]

  The Prime Minister
  For this purpose, my office forms part of the Cabinet Office. I refer the hon. Member to the reply given by my right hon. Friend the Chancellor of the Duchy of Lancaster today.
  211

HOME DEPARTMENT

  Police (Training)
  Mr. Byers
  To ask the Secretary of State for the Home Department how many police officers, and from which countries, have received training by police authorities in this country in the last five years. [225]

  Mr. Maclean
  [holding answer 21 November 1995]: Information is available only for the period since January 1991. Central records show that 157 training visits to police forces have taken place since then involving officers from the countries listed. The number of officers involved is not recorded.

  Country

  Number of visits

  Antigua

  1

  Argentina

  1

  Aruba

  1

  Australia

  1

  Bahrain

  8

  Bahamas

  1

  Bangladesh

  2

  Barbados

  3

  Bermuda

  4

  Bolivia

  1

  Botswana

  5

  Brunei

  2

  Cameroon

  1

  Canada

  1

  China

  1

  Colombia

  1

  Cyprus

  4

  Czech Republic

  1

  Denmark

  1

  Dubai

  1

  Ethiopia

  1

  France

  7

  Gambia

  1

  Germany

  2

  Gibraltar

  4

  Guatemala

  1

  Honduras

  1

  Hungary

  1

  India

  7

  Indonesia

  3

  Italy

  2

  Jamaica

  2

  Kenya

  3

  Lesotho

  3

  Malawi

  4

  Malaysia

  1

  Mauritius

  3

  Namibia

  9

  Netherlands

  2

  Nigeria

  3

  Norway

  2

  Oman

  2

  Pakistan

  1

  Panama

  1

  Paraguay

  1

  Philippines

  4

  Romania

  1

  Saudi Arabia

  3

  Sierra Leone

  3

  Singapore

  6

  Slovakia

  1

  South Africa

  4

  Sri Lanka

  1

  St. Helena

  3

  St. Kitts

  1

  St. Lucia

  1

  212

  Country

  Number of visits

  Swaziland

  6

  Sweden

  1

  Thailand

  1

  Tonga

  1

  Tristan Da Cunha

  1

  Uganda

  7

  United Arab Emirates

  1

  Zimbabwe

  3

  Homosexuals (Violence)
  Mr. Llwyd
  To ask the Secretary of State for the Home Department what studies are currently being carried out by his Department on the subject of violence against homosexuals. [604]

  Mr. Maclean
  [holding answer 20 November 1995]: None.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for the Home Department how his Department publicises payment practices other than as percentages of invoices paid late. [959]

  Mr. Howard
  My Department publicises information about its payment practices in its annual report, including a commitment to the Confederation of British Industry prompt payment code. Statistics on prompt payment are currently publicised only as a percentage of invoices paid.

  Mrs. Roche
  To ask the Secretary of State for the Home Department what is the amount owed to those businesses whose invoices were not paid within 30 days in each of the last five years. [1115]

  Mr. Howard
  Information about the total value of invoices not paid within 30 days in each of the last five years is not available except at disproportionate cost.

  Mrs. Roche
  To ask the Secretary of State for the Home Department what is the average length of time it takes for his Department to pay invoice.

  Mr. Howard
  An analysis of invoices paid in October 1995 shows that on average they were paid within 24 days of receipt of a valid invoice.

  Correspondence
  Mr. Meacher
  To ask the Secretary of State for the Home Department when he will be in a position to reply to the letter from the hon. Member for Oldham, West of 27 October following up the meeting with the former Under-Secretary on 22 August concerning the case of Atia Idrees, J242872. [469]

  Mr. Kirkhope
  Inquiries into Miss Idrees's case are continuing. I will write to the hon. Member shortly detailing the current situation.

  Mr. Meacher
  To ask the Secretary of State for the Home Department when he will be in a position to reply to the letter from the hon. Member for Oldham, West of 1 September, concerning Mr. Inayat Khan, K455873/2 (S), PO 01496/95. [468]
  213
  Mr. Kirkhope
  I shall write to the hon. Member shortly.

  Manslaughter Convictions (Children)
  Mr. Alex Carlile
  To ask the Secretary of State for the Home Department how many people sentenced under section 53(2) of the Children and Young Persons Act 1933 during the years of 1974 to 1993 were convicted of manslaughter; and, of those convicted of manslaughter, how many were sentenced to detention for life. [630]

  Mr. Maclean
  The information requested for the years 1979 to 1994 is given in the table. Information for earlier years is not available centrally.

  Persons sentenced under section 53(2) of the Children and Young Persons Act 1933, following conviction for manslaughter, 1979 to 1994

  England and Wales

  Total sentenced

  Detention for life

  Diminished responsibility1

  Other manslaughter

  Diminished responsibility

  Other manslaughter

  1979

  —

  3

  —

  —

  1980

  1

  3

  1

  —

  1981

  —

  6

  —

  —

  1982

  1

  5

  1

  —

  1983

  1

  5

  1

  —

  1984

  —

  3

  —

  —

  1985

  1

  6

  1

  —

  1986

  —

  7

  —

  2

  1987

  —

  9

  —

  1

  1988

  —

  3

  —

  —

  19892

  —

  8

  —

  1

  19902

  —

  1

  —

  —

  1991

  —

  5

  —

  —

  19923

  —

  4

  —

  1

  19933

  1

  11

  1

  —

  19943

  —

  8

  —

  —

  1 Section 2, Homicide Act 1957.

  2 Comparison with prison receptions suggests that there may have been under recording in 1989 and 1990, although this is less likely in 1990.

  3 Under the Criminal Justice Act 1991, the arrangements for imposing longer sentences also applied to 17 year olds from 1 October 1992.

  Mr. Carlile
  To ask the Secretary of State for the Home Department how many tariffs of those convicted of manslaughter under section 53(2) of the Children and Young Persons Act 1933 during the years 1974 to 1993 and sentenced to detention for life were(a) under five years, (b) six to nine years, (c) 10 to 14 years and (d) 15 to 20 years. [632]

  Miss Widdecombe
  There have been 16 prisoners in Prison Service custody convicted between 1974 and 1993 of manslaughter under section 53(2) of the Children and Young Persons Act 1933.

  The information about their tariffs is as follows:

  (a) under 5 years: 21

  (b) 6 to 9 years: 9

  (c) 10 to 14 years: 5

  (d) 15 to 20 years: 0

  1Includes one tariff of 5 years.

  Mr. Carlile
  To ask the Secretary of State for the Home Department how many young offenders sentenced under section 53(2) of the Children and young Persons Act 1933 from 1974 to 1993 commenced their sentences 214
  within local authority secure accommodation; and at what age they were subsequently transferred to prison department custody. [633]

  Miss Widdecombe
  Responsibility for this matter has been delegated to the temporary Director General of the Prison Service, who has been asked to arrange for a reply to be given.

  Letter from Richard Tilt to Mr. Alex Carlile, dated 22 November 1995:
  The Home Secretary has asked me to reply to your recent Question about young offenders sentenced under section 53(2) of the Children and Young Persons Act 1933.
  Records are not available before 1983. The figures since 1983 are set out in the attached table. Records are not kept on the age at which young offenders transfer to custody.

  Year

  A

  B

  C (Percentage)

  1983

  53

  13

  24.5

  1984

  52

  16

  30.8

  1985

  44

  13

  29.5

  1986

  57

  9

  15.8

  1987

  56

  14

  25.0

  1988

  61

  11

  18.0

  1989

  60

  11

  18.3

  1990

  71

  13

  18.3

  1991

  57

  11

  19.3

  1992

  80

  11

  13.8

  1993

  116

  18

  15.5

  Notes:

  A=Number of section 53(2)s who commenced their sentences in local authority secure accommodation.

  B=Number of section 53(2)s who transferred from local authority secure accommodation to Young Offender Institutions.

  C=Percentage of the total section 53(2) who transferred.

  Commission for Racial Equality
  Mrs. Ann Winterton
  To ask the Secretary of State for the Home Department how many and what percentage of the employees of the Commission for Racial Equality are from(a) white European, (b) Asian, (c) black and (d) other ethnic minorities. [114]

  Mr. Kirkhope
  As at 30 June 1995, the breakdown of employees at the Commission for Racial Equality by racial groups was as follows:

  Number

  Per cent.

  White European

  62

  29

  Asian

  36

  17

  Black

  97

  46

  Other ethnic minorities

  17

  8

  212

  100

  Mrs. Winterton
  To ask the Secretary of State for the Home Department if he will make a statement on the outcome of the Commission for Racial Equality's 1994 restructuring programme, and indicate in particular both the total number of jobs which were shed as a result of that programme and the numbers of(a) white European and (b) ethnic minority redundancies associated with that total. [116]
  215
  Mr. Kirkhope
  We welcome action by the Commission for Racial Equality to restructure its organisation to provide greater efficiency. No jobs were lost as a result of this exercise.

  Mrs. Winterton
  To ask the Secretary of State for the Home Department what is(a) his policy and (b) that of the Commission for Racial Equality in respect of the shortlisting and appointment of disproportionately few member of ethnic minorities; and if he will make a statement. [118]

  Mr. Kirkhope
  Appointments should be on merit and on the ability of the individual to meet the criteria for the post concerned. The Commission for Racial Equality's equal opportunities policy aims to ensure that no job applicant or employee receive less favourable treatment than another on the grounds of race, colour, nationality, ethnic or national origins, or religious beliefs.

  Mrs. Winterton
  To ask the Secretary of State for the Home Department how many members currently serve upon the Commission for Racial Equality; and how many of those are of white European background. [115]

  Mr. Kirkhope
  There are currently 12 commissioners on the Commission for Racial Equality. Two are of white European background.

  Mrs. Winterton
  To ask the Secretary of State for the Home Department what steps he intends to take to ensure that the ethnic representation among members and employees of the Commission for Racial Equality in future reflects that of society as a whole. [117]

  Mr. Kirkhope
  The Commission for Racial Equality operates an equal opportunities policy. I support this. It advertises vacancies in the mainstream press, and some of the ethnic minority press in order to ensure that all sections of the community are aware of job opportunities with the commission. Appointments should always be made on merit.

  Mrs. Winterton
  To ask the Secretary of State for the Home Department what plans he has to prosecute the Commission for Racial Equality for discriminatory employment practices; and if he will make it his policy to bring forward legislation to abolish that Commission. [119]

  Mr. Kirkhope
  We have no plans to do either.

  Immigration Officers
  Mr. Alex Carlile
  To ask the Secretary of State for the Home Department what proportion of the total remuneration to immigration officers was based on performance-related pay, for the last five years for which figures are available; and if he will make a statement. [629]

  Mr. Kirkhope
  Immigration Service grades are currently covered by the national civil service pay settlements and information is not readily available in the form requested.

  Exclusion Orders
  Mr. Worthington
  To ask the Secretary of State for the Home Department how many exclusion orders have 216
  been (a) imposed, (b) revoked, (c) reimposed at the expiry of a previous order and (d) allowed to lapse by him in the last 12 months. [1223]

  Mr. Howard
  Figures for the number of exclusion orders imposed, revoked, renewed and allowed to lapse over the last year are shown in the below table.

  Number of exclusion orders in force, renewed, revoked, or allowed to lapse: November 1994-November 1995

  Newly-made orders

  Orders revoked

  Orders renewed

  Orders allowed to lapse

  0

  20

  4

  6

  Car Crime
  Mr. Burden
  To ask the Secretary of State for the Home Department what plans he has to collect information on the make and year of manufacture of vehicles affected by theft; and what assessment he has made of the usefulness of such information in tackling car crime. [1197]

  Mr. Maclean
  The Home Office does not routinely collect information about the make and year of manufacture of stolen vehicles. In 1991, however, information relating to the previous calendar year was used to compile the car theft index which revealed conclusively that certain makes and models of car were more at risk of theft than others. The recently published study by the police research group into the theft of heavy goods vehicles includes information about vehicles stolen during 1994 broken down by make, year of registration and body type, and by location and time at which theft occurred. The findings of the study are being used to encourage vehicle and security device manufacturers and heavy goods vehicles owners and drivers to take specific action to help reduce theft levels.

  As the result of an agreement signed earlier this year between the Home Office and the CCN Group Ltd., the National Criminal Intelligence Service is receiving comprehensive data on all stolen vehicles from CCN and using this information, which can be broken down into various categories, in its work against organised crime. We are currently considering what other uses can be made of these data in combating vehicle crime in general.

  Mr. Pearson
  To ask the Secretary of State for the Home Department (1) what was the number of reported burglaries from motor vehicles in the area covering Dudley, West in each year since 1979 and the percentage difference in the number of those reported burglaries between 1979 and the latest year for which figures are available; [586]

  (2) what was the number of reported thefts from motor vehicles in the area covering Dudley, West in each year since 1979 and the percentage difference in the number of those reported thefts between 1979 and the latest year for which figures are available; [584]

  (3) what was the total number of reported crimes in the area covering Dudley, West in each year since 1979 and the percentage difference in the number of those reported crimes between 1979 and the latest year for which figures are available. [587]
  217
  (4) what was the number of reported thefts of motor vehicles in the area covering Dudley, West in each year since 1979 and the percentage difference in the number of those reported thefts between 1979 and the latest year for which figures are available. [585]

  Mr. Maclean
  The information is not collected centrally.

  Eaton Leonard Green
  Mr. Heppell
  To ask the Secretary of State for the Home Department (1) what assessment he has made of the adequacy of compliance with the present Home Office guidelines in relation to police informants; [597]

  (2) when he was informed of the entry into the United Kingdom of Eaton Leonard Green; [1048]

  (3) what action he proposes to take against Scotland Yard staff in respect of the Eaton Leonard Green case; [1044]

  (4) if he will list (a) the charges brought against Eaton Leonard Green and (b) the charges for which he was prosecuted; and what role his Department played in determining which charges should proceed to prosecution; [1050]

  (5) which senior officer or officers had responsibility for the close supervision of Eaton Leonard Green in accordance with Home Office guidelines; [1042]

  (6) what factors underlay the admission of Eaton Leonard Green into the United Kingdom on 12 February 1991; [1049]

  (7) when he received the first and second internal inquiries carried out by Scotland Yard into the Eaton Green case. [1043]

  Mr. Maclean
  The use of informants is an operational matter for the police. It is for each chief constable to ensure that there are proper procedures for handling informants in his force. It is also for each chief constable to take whatever action he considers appropriate if he believes one of his officers has acted improperly in handling an informant.

  Eaton Green was admitted to the United Kingdom on 13 February 1991. The immigration officer who dealt with him was satisfied that he was coming to this country as a visitor and give him leave to enter for six months. Ministers were not aware of police interest in him or of his role as a police informant until after his conviction was reported in the press.

  Eaton Green was charged by Nottinghamshire constabulary of:

  (i) conspiracy to commit grievous bodily harm, contrary to section 1(1) of the Criminal Law Act 1977;

  (ii) conspiracy to rob, contrary to section 1(1) of the Criminal Law Act 1977;

  (iii) possession of a firearm whilst committing an indictable offence—viz; robbery, contrary to section 18(1) of the Firearms Act 1968;

  (iv) possession of a firearm with intent to endanger life, contrary to section 16 of the Firearms Act 1968.

  Count (i) was varied on the indictment to;

  (v) conspiracy to cause actual bodily harm, contrary to section 1(1) of the Criminal Law Act 1977.

  218
  Green was acquitted of charge (v) by direction of the judge. He pleaded guilty to charges (ii) and (iv) and also pleaded guilty to causing grievous bodily harm, contrary to section 20 of the Offences Against the Person Act 1861. The prosecution did not proceed with the other charges, given his guilty plea.

  The Home Office played no part in determining what charges should be brought against Mr. Green or what charges proceeded to prosecution.

  A former detective chief inspector at Brixton police station was the senior officer responsible for controlling Eaton Green as a police informant.

  The two initial inquiries in relation to this case were internal to the Metropolitan police. The report of a third inquiry is being prepared, a copy of which will be sent to my right hon. and learned Friend.

  Asylum Seekers
  Mr. Henderson
  To ask the Secretary of State for the Home Department how many people are currently seeking asylum from an address in(a) Scotland, (b) Wales, (c) Northern Ireland and (d) by region, within England. [564]

  Mr. Kirkhope
  Information on the places or residence of people currently seeking asylum is not held centrally.

  Mr. Henderson
  To ask the Secretary of State for the Home Department (1) what is the average time currently taken to resolve fully an asylum application, including determination of any appeal to the Immigration Appellate Authority; [562]

  (2) what is the average time taken by his Department's asylum division to process and despatch to the Immigration Appellate Authority an appeal against a refusal of admission; and what is the average number of working days between the date of the appeal being despatched to the IAA by his Department and the date of its determination; [560]

  (3) what is the average time currently taken by his Department to reach an initial decision on (a) asylum applications submitted prior to implementation of the Asylum and Immigration Appeals Act 1993, (b) asylum applications submitted since the implementation of the Act and (c) all asylum applications. [561]

  Mr. Kirkhope
  Information on the times taken at the various stages of the asylum process are given in the table.

  Average times involved in deciding applications for asylum April—September 1995

  Months

  Time taken for an initial decision to be made (Pre-Act applications)

  34.1

  Time taken for an initial decision to be made (Post-Act applications)

  8.7

  Time taken by the Home Office to process an appeal

  4.1

  Time taken by the IAA to determine an appeal

  5.6

  Mr. Henderson
  To ask the Secretary of State for the Home Department how many asylum applications are currently awaiting an initial decision by the Home Office asylum division; how many appeals against a refusal of asylum are currently being processed by the Home Office;
  219
  and how many appeals against a refusal of asylum, having been processed by the Home Office and despatched to the Immigration Appellate Authority, are awaiting determination by the IAA. [558]

  Mr. Kirkhope
  As at 30 September 1995, 64,415 asylum applications were awaiting initial decisions by the Home Office, 2,705 appeals were being processed by the Home Office from people seeking asylum and 8,925 such appeals were awaiting hearings by the Immigration Appellate Authority.

  Mr. Henderson
  To ask the Secretary of State for the Home Department what plans he has to implement paragraphs 17, 22 and 31 of the resolution on minimum guarantees for asylum procedures, signed at the European Union Justice and Home Affairs Council at Luxembourg on 20 and 21 June. [556]

  Mr. Kirkhope
  Asylum procedures in the United Kingdom are consistent with those paragraphs and this will remain the case after implementation of the asylum proposals announced by my right hon. and learned Friend on 20 November.

  Mr. Henderson
  To ask the Secretary of State for the Home Department if he will list the European countries which operate accelerated asylum procedures which derogate from the general principle that an individual appealing against a refusal of asylum may remain in the country until such time as the appeal is determined. [551]

  Mr. Kirkhope
  Comprehensive information is not available but our understanding is that France, Germany, the Netherlands, Sweden and Switzerland are all countries where, depending on the circumstances, appeals against removal on safe third country grounds may have no automatic suspensive effect; and that Denmark, Finland, Germany, the Netherlands and Switzerland operate procedures based on identification of countries of origin in which there is considered to be no serious risk of persecution.

  Mr. Henderson
  To ask the Secretary of State for the Home Department on what date a copy of the resolution on minimum guarantees for asylum procedures, signed at the Justice and Home Affairs Council in June 1995, was placed in the Library. [555]

  Miss Widdecombe
  A copy is being placed in the Library.

  Mr. Henderson
  To ask the Secretary of State for the Home Department what plans he has to implement paragraphs 8 and 12 of the resolution on manifestly unfounded applications for asylum and the conclusions on countries in which there is generally no serious risk of persecution, signed at the Justice and Home Affairs Council in London on 30 November and 1 December 1992. [557]

  Mr. Kirkhope
  Asylum procedures in the United Kingdom are consistent with these paragraphs and this will remain the case after the implementation of the asylum proposals announced by my right hon. and learned Friend on 20 November.

  Mr. Timms
  To ask the Secretary of State for the Home Department what guidance his Department gives to failed asylum applicants from Sri Lanka before their 220
  return there; what steps are taken to ensure that such applicants are returned to safe areas of Sri Lanka; and which areas of Sri Lanka are considered to be safe for such a purpose. [14]

  Mr. Kirkhope
  No specific guidance is given to unsuccessful asylum seekers from Sri Lanka before their return there. It is considered safe to return Sri Lankan nationals who have no claim to remain here to Colombo and the south of the country.

  Ms Janet Anderson
  To ask the Secretary of State for the Home Department if he will list, for each year since 1990, the number of applicants who have been refused asylum in the UK and have subsequently suffered(a) persecution, (b) imprisonment and (c) the death penalty in the country to which they have been returned. [148]

  Mr. Kirkhope
  We have no means of monitoring what happens to people who have been returned to their country of origin. However, no person who has demonstrated that he or she has a well-founded fear of persecution in a particular country for one of the reasons set out in the 1951 United Nations convention relating to the status of refugees would be returned to that country.

  Mr. Keen
  To ask the Secretary of State for the Home Department how many applications for political asylum were(a) granted and (b) refused from applicants in (i) India, (ii) Pakistan and (iii) Nigeria in (1) 1993 and (2) 1994. [1094]

  Mr. Kirkhope
  Information on decisions relating to asylum applications from nationals of India, Pakistan and Nigeria is published in tables 3.1 and 3.3 of the Home Office statistical bulletin "Asylum Statistics United Kingdom 1994", issue 15–95. A copy of this publication is available in the Library.

  European Treaties
  Mr. Mullin
  To ask the Secretary of State for the Home Department on what dates the EU treaties on simplified extradition procedures, Europol, the customs information system and protection of the communities' financial interests were(a) agreed in principle, (b) signed, (c) ratified and (d) came into force; and on what dates copies of the agreed texts were made available to the House. [909]

  Miss Widdecombe
  The convention on simplified extradition procedures was agreed and signed by Ministers at the Justice and Home Affairs Council on 10 March. The conventions on Europol, the customs information system and protection of the communities' financial interests were agreed by Heads of Government at the Cannes European Council on 26 and 27 June and signed by European Union ambassadors on 26 July. The United Kingdom Government have yet to ratify any of the conventions. In each case, they will enter into force three months after the last member state to ratify a particular instrument has notified the Secretary-General of the Council of the European Union that the necessary domestic procedures have been completed.

  In accordance with the arrangements for scrutiny of work under title VI of the treaty on European Union, the Government submitted draft texts of these conventions for examination by the Home Affairs Committee and the Select Committee on European Legislation. A copy of the

  221
  extradition convention was sent to the Library on 30 March. I regret that texts of the other conventions were not deposited in the Library at the time of their signature, but this has now been done.

  Doncaster Prison
  Mr. Goerge Howarth
  To ask the Secretary of State for the Home Department if he will make a statement on the incident on 20 September which led to the temporary closure of Doncaster prison and the searching of all prisoners. [390]

  Miss Widdecombe
  Responsibility for this matter has been delegated to the temporary Director General of the Prison Service, who has been asked to arrange for a reply to be given.

  Letter from A.J. Pearson to Mr. George Howarth dated 22 November 1995:
  The Home Secretary has asked me, in the absence of the Director General from the office, to reply to your recent Question about the incident on 20 September which led to the temporary closure of Doncaster prison and the searching of all prisoners.
  Information was received from an external source of a possible escape attempt from the prison and that weapons might be used. A full close down search took place on 20 September with the additional support of the South Yorkshire police.
  No escape equipment nor any weapons were discovered as a result of the search.

  Chimpanzees
  Ms Janet Anderson
  To ask the Secretary of State for the Home Department (1) what was the most recent date when chimpanzees were used in a UK facility designated under the Animals Scientific Procedures Act 1986; [144]

  (2) what plans he has to ban the use of chimpanzees in research and testing in the UK; and if he will make a statement. [143]

  Mr. Kirkhope
  None have been used under the Act in any designated establishment.

  We have no plans to ban the use of chimpanzees in research and testing in the United Kingdom. Any application to use chimpanzees in a procedure requiring to be licensed under the Animals (Scientific Procedures) Act 1986 would be considered in accordance with the requirements of section 5 of the Act, and also referred to the Animal Procedures Committee for advice. Exceptional and specific justification would have to be established to show why chimpanzees, rather than any other protected species, were required.

  Police (Self-defence and Restraint)
  Mr. Cohen
  To ask the Secretary of State for the Home Department if he will make available in the Library(a) the guidance on self-defence and restraint of the Association of Chief Police Officers and (b) the evidence of the Police Complaints Authority on the effect of neck holds and certain arm locks; and if he will make a statement. [153]
  222
  Mr. Maclean
  No. The Association of Chief Police Officers guidance on self-defence and restraint, which is currently under review, deals with operational matters which could be of assistance to criminals and is not intended for publication outside the police service. Any evidence on neck holds and arm locks available to the Police Complaints Authority is a matter for the authority itself.

  Parole Delays
  Mr. George Howarth
  To ask the Secretary of State for the Home Department how many prisoners are undergoing parole delays; how long, on average, these delays take; what is the percentage of accepted parole applications; and what is the cost per week per inmate undergoing parole delays. [39]

  Miss Widdecombe
  For the period August to October 1995, some 800 prisoners were notified of parole decisions after their parole eligibility date or its anniversary. The average delay was just over seven weeks, 46 per cent. of all applications for parole were accepted.

  The cost of keeping an inmate in prison varies between establishments. The average cost per inmate per week in category C accommodation is currently about £378.

  Internet
  Mr. French
  To ask the Secretary of State for the Home Department how many prosecutions there have been in the last year for offences related to the dissemination of illegal material via the Internet. [174]

  Mr. Maclean
  Court proceedings data held centrally by my Department does not identify this type of offence.

  Prison Officers (Drug Offences)
  Ms Janet Anderson
  To ask the Secretary of State for the Home Department how many prison officers have been given custodial sentences for drugs offences in each year since 1990, broken down by type of offence. [134]

  Miss Widdecombe
  Responsibility for this matter has been delegated to the temporary Director General of the Prison Service, who has been asked to arrange for a reply to be given.

  Letter from Richard Tilt to Ms Janet Anderson, dated 22 November 1995:
  The Home Secretary has asked me to reply to your recent Question asking how many prison officers have been given custodial sentences for drugs offences in each year since 1990, broken down by type of offence.
  The Prison Service has no record of any prison officer receiving a custodial sentence for drugs offences in any of the years in question.

  Metropolitan Police
  Mr. Cohen
  To ask the Secretary of State for the Home Department if he will call for a report from the Commissioner of Police of the Metropolis on the level of staffing in CID offices and other police units involved in extensive detective work; and if he will make a statement. [150]

  Mr. Maclean
  It is for the Commissioner of Police of the Metropolis to deploy his resources as he sees fit.
  223

  Elections
  Mr. Mullin
  To ask the Secretary of State for the Home Department how many ballot papers were rejected for want of an official mark in the 1992 general election. [907]

  Mr. Kirkhope
  Some 2,593 ballot papers were rejected for want of an official mark in the 1992 general election. Statistics concerning the outcome of the 1992 general election, including information on the number of ballot papers rejected on these grounds, are published in the HMSO booklet "Election Expenses".

  Mr. Mullin
  To ask the Secretary of State for the Home Department how many election petitions have been applied for in respect of local government, parliamentary and Euro-elections since 1970. [911]

  Mr. Kirkhope
  The number of election petitions applied for in respect of local government and parliamentary elections since 1970 is 80 and six, respectively; the comparable figure for European parliamentary elections since 1979 when those elections first took place is three.

  Mr. Mullin
  To ask the Secretary of State for the Home Department what action he took in response to the recommendation of the Home Affairs Committee in the 1982–83 Session that the requirement to stamp the ballot paper with an official mark be ended; and if he will make a statement. [906]

  Mr. Kirkhope
  The Government considered carefully the recommendation by the Home Affairs Select Committee but decided that the official mark should be retained. The Government concluded that the official mark provided a continuing safeguard against the introduction into the ballot of counterfeit or illegally acquired ballot papers. The Government's full response to the recommendations is available in "The Government Reply to the First Report from the Home Affairs Committee Session 1982–83 HC32–1".

  Immigration Rules
  Mr. Heppell
  To ask the Secretary of State for the Home Department if he is informed of all decisions of the immigration authorities to allow entry to the United Kingdom outside the normal immigration rules. [1045]

  Mr. Kirkhope
  It would not be practical for my right hon. and learned Friend to be informed personally of every occasion on which discretion is exercised on his behalf outside the immigration rules.

  Mr. Heppell
  To ask the Secretary of State for the Home Department in what circumstances(a) police and (b) immigration officials have the right to instruct immigration officials to allow someone permanent leave to remain in the United Kingdom when that person has no legal right to do so. [1045]

  Mr. Kirkhope
  Leave to remain is granted under the immigration rules on my right hon. and learned Friend's behalf. The police have no locus in the matter. Discretion to grant indefinite leave to remain outside the rules is 224
  exercised sparingly, in accordance with instructions or in exceptional compassionate circumstances.

  Premier Prison Services Ltd.
  Mr. George Howarth
  To ask the Secretary of State for the Home Department what special qualifications are required of Premier Prison Services Ltd. staff to deal with immigration detainees; what is the ratio of staff to detainees; and if he will make a statement. [402]

  Mr. Kirkhope
  Premier Prison Services Ltd. is not responsible for the management of any immigration detention centre. However, people detained under immigration powers may be detained in Doncaster prison, which is managed by the company. Requirements as to the company's performance and staffing are set down in a management contract awarded by the Prison Service.

  Police (Patrol Duties)
  Ms Janet Anderson
  To ask the Secretary of State for the Home Department what percentage of police strength is out on patrol duties between(a) midnight and 6am, (b) 6am and 12 noon, (c) 12 noon and 6pm and (d) 6pm and midnight. [145]

  Mr. Maclean
  This information is not available centrally and could be obtained only at disproportionate cost.

  Tobacco Project Licences
  Mr. Cohen
  To ask the Secretary of State for the Home Department if he will list the purposes for which project licences have been approved by the Animal Procedures Committee in relation to tobacco in the last five years.[335]

  Mr. Kirkhope
  The following project licences have been granted:

  1991: none

  1992: (i) the development of in vitro methods to monitor the genetic damage caused in humans by environmental pollutants; and (ii) the use of tobacco smoke as one experimental tool to study lung disease.

  1993: none.

  1994: none.

  1995:

  (i) the evaluation of the role of bacterial toxins in sudden infant death syndrome; and

  (ii) the investigation of the role of bacterial toxins in periodontal disease.

  It is the practice of the Animal Procedures Committee to set out in its annual reports details of all such applications considered.

  Domestic Violence
  Mr. Cohen
  To ask the Secretary of State for the Home Department when the inter-departmental group on domestic violence last met; and what policy decisions arose. [333]

  Mr. Maclean
  For the policy issues considered at the last meeting of the ministerial group on domestic
  225
  violence, held on 17 May 1994, I would refer the hon. Member to the reply given to his question on 17 January, columns 380–81. A date for the next meeting of the ministerial group has not yet been fixed, but it is likely to meet early in the new year.

  The official inter-departmental group on domestic violence met on Wednesday 15 November 1995. The group reviewed the Government-funded domestic violence public awareness campaign and the recent publication of an inter-agency circular designed to promote a more co-ordinated response to domestic violence by local agencies. It also considered possible future areas of work and commissioned further work on the need for a centrally co-ordinated policy on refuge provision.

  Parkhurst Prison
  Mr. George Howarth
  To ask the Secretary of State for the Home Department how many redundancies will be triggered by the implementation of automated security systems at HM prison Parkhurst; and what redundancy settlements he proposes. [392]

  Miss Widdecombe
  Responsibility for this matter has been delegated to the temporary Director General of the Prison Service, who has been asked to arrange for a reply to be given.

  Letter from Richard Tilt to Mr. George Howarth, dated 22 November 1995:
  The Home Secretary has asked me to reply to your recent Question about the number of redundancies at Parkhurst prison which may be expected with the implementation of automated security systems there and what redundancy packages have been made.
  Automated security systems are an aid to prison security. No staff redundancies at Parkhurst are anticipated from the implementation of such security systems.

  Female Prisoners (Maternity Appointments)
  Mr. Cohen
  To ask the Secretary of State for the Home Department if he will call for a report from the Director General of the Prison Service regarding its recent instruction that all female prisoners attending for maternity appointments be handcuffed throughout their care; if he will review this instruction in consultation with relevant organisations including the Royal College of Midwives and the National Childbirth Trust; and if he will make a statement. [317]

  Miss Widdecombe
  Responsibility for this matter has been delegated to the temporary Director General of the Prison Service, who has been asked to arrange for a reply to be given.

  Letter from Richard Tilt to Mr. Harry Cohen, dated 22 November 1995:
  The Home Secretary has asked me to reply to your recent Question about the handcuffing of female prisoners on escort.
  For several years escapes by women under escort have been disproportionately high when compared with the number of women prisoners and, therefore, in April of this year, it was decided to handcuff female prisoners under escort in the same way as we have always done for men.
  226
  Handcuffs are used to improve security and reduce the risk of escape. Initial indications show that the rate of escape of female prisoners is down by 50 per cent since the new policy was introduced.
  For both sexes, handcuffs must be removed if there is a medical, surgical or clinical reason for this. Restraints must always be removed from prisoners during labour and childbirth.

  EU Third Pillar Procedures
  Mr. Mullin
  To ask the Secretary of State for the Home Department what procedures are followed by the Government for making available to(a) the House and (b) the public the texts of treaties under the EU third pillar procedures, after there has been agreement as to their content; and how soon after such agreement it is intended to make them available in printed published form. [910]

  Miss Widdecombe
  The Government aim to deposit in the Library copies of unclassified documents which have been adopted or agreed by the Council of Ministers. The texts of conventions concluded in the third pillar are available to the public through the Official Journal of the European Communities, in which they are published after signature. The Government publish the texts of international agreements as command papers for presentation to Parliament as soon as possible after signature.

  Privately Managed Prisons
  Mr. George Howarth
  To ask the Secretary of State for the Home Department if he will list the studies which have been commissioned by his Department to evaluate the performance of existing privately managed prisons indicating in each case the research body involved and the dates on which(a) each study was commissioned, (b) each study was commenced, (c) he expects to receive reports, and (d) he expects each report to be published; and if he will set out the cost of the studies in each case. [477]

  Miss Widdecombe
  Responsibility for this matter has been delegated to the temporary Director General of the Prison Service, who has been asked to arrange for a reply to be given.

  Letter from Richard Tilt to Mr. George Howarth, dated 22 November 1995:
  The Home Secretary has asked me to reply to your recent Question about studies commissioned to evaluate the performance of contractually-managed prisons.
  The only such study commissioned to date has been in respect of Wolds prison and was undertaken jointly by the Centre for Criminology and Criminal Justice at Hull University and the Institute of Criminology at the University of Cambridge. This was commissioned on 25 June 1992, and study commenced in July of that year. The research team's formal programme of fieldwork started in January 1993 and was extended to March 1994. The first draft version of the report was received in December 1994, and further revisions to the draft were submitted in April and July of 1995. It is anticipated that the report will be published shortly. The cost of the study was £120,772.

  Prisoners (Medical Operations)
  Ms Janet Anderson
  To ask the Secretary of State for the Home Department what guidance is given to prison governors in respect of prisoners awaiting medical operations; how many prisoners are currently awaiting operations and what is the average waiting time for such operations. [131]
  227
  Miss Widdecombe
  Responsibility for this matter has been delegated to the temporary Director General of the Prison Service, who has been asked to arrange for a reply to be given.

  Letter from A. J. Pearson to Ms Janet Anderson, dated 22 November 1995:
  The Home Secretary has asked me, in the absence of the Director General from the office, to reply to your recent Question about guidance to prison governors in respect of prisoners awaiting medical operations, the number of prisoners awaiting medical operations and the average waiting time for such operations.
  No specific advice on prisoners awaiting operations has been issued to governors as the decision to refer a prisoner for a medical operation is a purely clinical one and therefore the responsibility of the medical officer. Information is not collected centrally on how many prisoners are awaiting operations or the average waiting time.

  Secretary of State's Speech
  Ms Janet Anderson
  To ask the Secretary of State for the Home Department when his speech of 12 October to the Conservative party conference was made available to the Home Department press office. [147]

  Mr. Howard
  On 12 October.

  Interception of Communications
  Mr. Cohen
  To ask the Secretary of State for the Home Department what are the procedures for authorising the tapping into E-mail and Internet communications and mobile telephone conversations; under what legal authority they are operated; and if he will make a statement. [324]

  Mr. Howard
  Any communication, including an E-mail, Internet or mobile telephone communication, when it is being transmitted by means of a public telecommunication system, may be intercepted in pursuance of a warrant issued in accordance with the provisions of the Interception of Communications Act 1985.
  228

  Suicides
  Mr. Llwyd
  To ask the Secretary of State for the Home Department if he will list for(a) England and (b) the United Kingdom the number of suicides; and if he will express this number as a percentage of the overall population for (i) 1971, (ii) 1981, (iii) 1991 and (iv) for each of the last available three years. [998]

  Mr. Bowis
  I have been asked to reply.

  The table shows the number of deaths and death rates per 100,000 population from suicide—ICD 1E950–E959, E980–E989—in England and the United Kingdom in 1971, 1981, 1990, 1991 and 1992.

  England

  United Kingdom

  Number

  Rater per 100,000

  Number

  Rate per 100,000

  1971

  3,739

  8.1

  5,760

  10.3

  1981

  5,988

  12.8

  7.192

  12.8

  1990

  5,594

  11.7

  6,863

  11.9

  1991

  5,567

  11.5

  6,801

  11.8

  1992

  5,541

  11.5

  6,863

  11.8

  The codes E950–E959 refer to deaths where suicide is the underlying cause of death, whereas E980–E989 relate to deaths where it is undetermined whether the injury was accidentally or purposefully inflicted. The majority of these, however, turn out to be suicide.

  The deaths for England in 1971 are only those coded to E950–E959, since deaths coded to E980–E989 are not available for England. Deaths coded to E980–E989 are included in the figures for the United Kingdom 1971.

  The coding of deaths in England, and Wales was changed in 1993 to an automated system. Though the results from this are generally satisfactory, the OPCS have identified significant problems in the coding of external causes of death. Certifications of deaths in 1993 and 1994 which could have been due to external causes are all being examined and re-coded as necessary. More reliable data, comparable to that for previous years, will be available in the first quarter of 1996.

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

Former Yugoslavia: Russian Co-operation
Lord Hooson Lord Hooson asked Her Majesty's Government:
What steps they are taking to encourage NATO, in particular, and the western powers generally, to work as closely as possible with the Russians to search for an eventual solution to the problems of former Yugoslavia.
The Minister of State, Foreign and Commonwealth Office (Baroness Chalker of Wallasey): My Lords, we have supported efforts to involve Russia in a NATO-led peace implementation force. Provided command and control questions are resolved, we look forward to working alongside Russian troops in implementing the Dayton agreement.
Lord Hooson: My Lords, I thank the Minister for that reply. Is it not clear that, although to a degree the Question has been overtaken by events, the long-term solution to Yugoslavia must depend to a very great degree on the co-operation of the Russians? To what extent is the Minister convinced that the Russians are not only co-operating as regards the present agreement but that they have an intention to enforce any arms embargo; otherwise one might have a repeat of the previous history of Yugoslavia, with one side supplying arms to a participant and another supplying arms to the other?
Baroness Chalker of Wallasey: My Lords, the noble Lord is absolutely right. I believe that he had some perception when he put this Question on the Order Paper. I shall be repeating a Statement from the other place later this afternoon. As regards the Russians, not only have we had good co-operation, particularly latterly, with them in the UN missions in both Bosnia and Croatia, but the Russians have agreed to play a continuing role in the implementation of the agreement reached at Dayton. We already have discussions well advanced with them on the NATO-led implementation force with whom they will work.
Lord Williams of Elvel: My Lords, can the noble Baroness elaborate a little about command and control? As I understand it, the force which is going to move into the former Yugoslavia is under NATO command. That is one of the stipulations in the Dayton agreement. Without wishing to pre-empt the discussion which will come later on the Statement, can the Minister say whether the Russians are prepared to accept NATO command and control; and, if so, will not the Russians have to be instructed on NATO identification and command codes; and is that a very good idea?
Baroness Chalker of Wallasey: My Lords, the noble Lord anticipates the Statement and some of its detail.
296
For the time being I can assure him that IFOR—the implementation force—will be NATO-led. It will be under NATO command and control and the details are being worked out.
Lord Finsberg: My Lords, can my noble friend say whether the discussions with the Russians are with people like Mr. Kosirov, the Defence Minister, and Mr. Yeltsin, or in fact with people who may disappear in a month's time when the new Duma is elected?
Baroness Chalker of Wallasey: My Lords, Mr. Ivanov, the Deputy Foreign Minister, has been leading the Russian delegation in Dayton. It has played a constructive political role throughout. I have every confidence that both he and others with whom he has been working will remain.
Lord Avebury: My Lords, have the Russians agreed to co-operate fully with the work of the war crimes tribunal and in particular to extradite any person charged with offences before that tribunal like Mr. Karadzic and General Mladic?
Baroness Chalker of Wallasey: My Lords, we are getting rather deep into this subject. I ask your Lordships to await the Statement.
Lord Mowbray and Stourton: My Lords, bearing in mind the question asked by the noble Lord, Lord Williams of Elvel, is my noble friend somewhat in agreement with it? Bearing in mind the Russian attitude to this problem over the past 140 years, is it realistic to expect them to do a complete volte-face, because leopards do not change their spots that deep?
Baroness Chalker of Wallasey: My Lords, I know that it will be difficult to accept, but the agreement arrived at over 21 days at Dayton has been so difficult to achieve that I do not believe that the Russians would not have given their commitment. While I understand the anxiety of the noble Lord, Lord Williams of Elvel, we have to find a way to go forward. We cannot keep looking back 140 years.

Counterfeit Currency
2.42 p.m.
Lord Campbell of Croy Lord Campbell of Croy asked Her Majesty's Government:
Whether counterfeit currency in sterling and foreign banknotes is being discovered on an increasing scale in the United Kingdom.
The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish): My Lords, there has been an increase in the numbers of counterfeit sterling banknotes, including counterfeits of Bank of England notes and notes of the Scottish and Northern Ireland banks, discovered in the United Kingdom in recent years. The vast majority of those finds were bulk seizures before the notes could enter circulation. Significant quantities of counterfeit foreign banknotes have also been found, again mainly in bulk seizures.
Lord Campbell of Croy: My Lords, I am grateful to my noble friend for that Answer although it contains

297
disturbing information. As most of those who ultimately suffer from counterfeit currency are shoppers on the high street, is progress being made in identifying the culprits, whether in Britain or abroad?
Lord Mackay of Ardbrecknish: My Lords, as I have explained, the figures relate to counterfeit notes which have been seized, usually in bulk. People have then been charged. The authorities in this country take the matter very seriously and work with authorities in other countries to make sure that the international aspect of the trade is made as difficult as possible. By a combination of good policing and the banks attempting to make their notes safe from counterfeiting, we hope to keep the problem under control.
Lord Renton: My Lords, as some expertise and a lot a vigilance is needed for ordinary people to detect forged notes, is there any hope that advice could be given to the public on how to do so?
Lord Mackay of Ardbrecknish: My Lords, I am grateful to my noble friend for asking that question because it so happens that I have with me a leaflet that has been distributed—
Noble Lords: Hear, hear!
Lord Mackay of Ardbrecknish:—and we did not even agree that I should be asked this question! It so happens that I have with me a leaflet entitled Know your Banknotes, of which 6.5 million copies have been distributed. It gives people advice on what to look for, such as the feel of the paper, the quality of the printing, the watermark and the windowed metal thread.
Lord Eatwell: My Lords, does the Minister recall that on 17th December 1993 his noble friend Lord St. Davids, speaking on behalf of the Government, told your Lordships' House that banknotes, particularly Bank of England banknotes, were designed to make them,
"as secure as possible from the threat of counterfeiting".—[Official Report, 17/12/93; col. 1518.]
That was the Government's justification for the confusing and muddy design of the banknotes with which we are now assailed in this country—a design with which any government that had an ounce of self-respect or pride in the monetary instruments of this country would not be associated. Given the figures that the Minister has just given for the increase in counterfeiting, is this not yet another government policy that has failed dismally?
Lord Mackay of Ardbrecknish: My Lords, I cannot recall my noble friend's remarks in 1993, but as I did not give any figures I am surprised that the noble Lord can attack me for them. The facts are quite simply that in 1993 a total of some £18 million of sterling counterfeit banknotes was found; the figure for 1994 was £17 million. That represents something like 0.02 per cent. of the number of banknotes in circulation at any given time.
Lord Peyton of Yeovil: My Lords, while I have no desire to echo the tiresome lecture that has just been given by the noble Lord opposite, and although I have
298
no expert knowledge, would I be right in thinking that the use of low quality paper for printing banknotes is itself a powerful aid to those whose business it is to circulate counterfeit banknotes?
Lord Mackay of Ardbrecknish: My Lords, I do not think that that is quite right. As I said earlier, the feel of the paper can be an indication of counterfeiting. The quality of the paper on which. banknotes are printed is good and is usually better than that obtained by the counterfeiters. The counterfeiters have found life easier with superior and new printing technologies which have given them the opportunity to be cleverer in their counterfeiting. That means that the authorities must—and do—attempt to find even cleverer ways of preventing that counterfeiting by making proper notes look and feel proper.
Lord Campbell o f Croy: My Lords, as the noble Lord, Lord Bruce of Donington, inexplicably, has not yet raised the point, can my noble friend say whether any attempt has been made to produce counterfeit ecus?
Lord Mackay of Ardbrecknish: My Lords, I think that the noble Lord, Lord Bruce of Donington, would probably think that an ecu was counterfeit in its entirety. I have no evidence that there have been any attempts to counterfeit the ecu, but I have no doubt that if we ever went down that road, attempts would then be made to counterfeit it.
Lord Bruce of Donington: My Lords, since my name has been drawn into this matter, may I ask the noble Lord whether he is aware that there is no question of the ecu being counterfeit because it is merely a myth and a dream?
Lord Mackay of Ardbrecknish: My Lords, I think that the noble Lord has made the point that I made in my initial Answer.

National Lottery: Impact on Betting
2.48 p.m.
Lord Gisborough Lord Gisborough asked Her Majesty's Government:
What steps are being taken to evaluate the effect of the National Lottery on the betting office industry.
The Minister of State, Home Office (Baroness Blatch): My Lords, we are monitoring off-course betting turnover in order to assess the impact of the National Lottery on the horserace betting levy, and plan to report our findings to Parliament in the spring of 1996.
Lord Gisborough: My Lords, I thank my noble friend for that Answer. However, is she aware of, and does she agree with, the estimate of the Henley Centre that a decrease of only 2 per cent. in the betting tax would prevent the threatened closure of some 2,500 betting shops, involving some 7,500 employees who would otherwise become unemployed, and that the loss in revenue from that 2 per cent. would be broadly fiscally neutral?
Baroness Blatch: My Lords, I am aware of the report from the Henley Centre, which was commissioned by

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the Bookmakers Committee. Two points arise from it. First, it is too early to say what impact the lottery is having on off-course race betting and on the levy. The other point is a matter for the Treasury and I cannot possibly pre-empt what may come out in next week's Budget.
Lord Wyatt of Weeford: My Lords, as chairman of the Tote, perhaps I may declare an interest. Are the Government aware that if they do not cut betting duty pretty sharply there will be many fewer betting shops from which to collect any revenue? They will lose revenue by not cutting the tax.
Baroness Blatch: My Lords, the noble Lord overstates his case just a little. The Government have done quite a lot to relax betting shop rules and are still looking at further ways of deregulating. The particular point that the noble Lord makes is a taxation point and one for my friends in the Treasury.
Lord Donoughue: My Lords, perhaps I too may declare an interest, not only as one who often subsidises bookmakers in the life to which they used to be accustomed, but as the unpaid director of one of England's smallest racecourses.
Lord Strathclyde: Oh!
Lord Donoughue: My Lords, small but classy, I agree. I am pleased with the Minister's positive reply that the Government will be meeting the promise that they made during the Committee stage of the National Lottery Etc. Bill that they would monitor and report to Parliament. Will the Minister do her best to see that the present situation is remedied? Is she aware that, according to the latest figures, betting revenue is down by 7.9 per cent., and that that decline coincides entirely with the lottery, and especially with the scratchcards? Will she press as much as possible to see that when the Government report in March 1996 they produce a remedy, the best remedy being to reduce betting duty?
Baroness Blatch: My Lords, it would not be appropriate for me to pre-empt the outcome of the monitoring exercise, nor would it be right at this stage to lay all the reductions in revenue at the lottery's door. It will not be until we have seen the results of the survey that we shall be able to respond positively, but that report will be to Parliament in 1996.
Lord Ewing of Kirkford: My Lords, I wonder whether I may ask a simple question. Is it the Government's policy to encourage or discourage gambling? Which one is it?
Baroness Blatch: My Lords, it is government policy that people should be free to choose.
Lord Bruce of Donington: My Lords, will the Minister tell the House since when it has become politically correct to elevate the status of betting to an industry? Will we presently have the lottery business elevated to an industry? I always thought that "industry" meant something rather more serious than that.
Baroness Blatch: My Lords, it is not for me to be pedantic about the meaning of words, except to say that
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there are a great many people who gain a living from the lottery business, and I believe that the people who work in it are industrious.
Lord Gisborough: My Lords, will my noble friend take into account also that as a result of scratchcards 600 betting offices have notified the Horserace Betting Levy Board that they will have to close? Is she worried that if there are no licensed betting shops betting will go underground and probably be controlled by criminal gangs?
Baroness Blatch: My Lords, the precise point that my noble friend makes will be the subject of the monitoring exercise. It will only be when we report to Parliament as a result of that exercise that we will be able to take the matter further.

Small Fishing Boats: Safety Grants
2.53 p.m.
The Earl of Kinnoull The Earl of Kinnoull asked Her Majesty's Government:
How soon they intend to introduce safety grants for 12-metre fishing vessels in the light of the new marine safety agency code of safety practice likely to come into force by 1997.
Lord Lucas: My Lords, that is an issue we shall consider when the code is finalised.
The Earl of Kinnoull: My Lords, I thank my noble friend for that brief reply, and I accept that grants have to be linked to an approved code. Is he aware that the smaller fishing boats represent over 80 per cent. of the entire British fishing fleet, and—perhaps not surprisingly—are subject to a higher degree of accidents than the larger boats? Is he further aware that the larger boats are subject to a code of safety which was approved over 20 years ago? Does he agree that the progress of discussions which have so far taken over two years has been at a somewhat dilatory pace when one considers that this is about safety at sea and fishermen's lives?
Lord Lucas: My Lords, it may interest my noble friend to know that the process of producing the code was put in motion by a report of this House about four years ago. Since then we have been discussing the idea with a large number of organisations. I believe that there are 200 associations of small fishermen. There has been a great deal of discussion required. We have not been seeking to impose a code on a great many unwilling fishermen. We have been seeking to develop a code with them with which they will agree wholeheartedly. I believe that we are very close to succeeding in that. We have taken the time that it required.
Lord Carter: My Lords, in the discussions to which the noble Lord referred, will he tell the House whether the Government will resolve the situation regarding flotation suits? They are made in Scunthorpe and exported to Canada where they are compulsory items on Canadian fishing boats. They are not compulsory here, and have not been eligible for safety grant on any size

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of vessel. In the discussions is it the intention to make flotation suits, which are so important, eligible for safety grant?
Lord Lucas: My Lords, the present position on the present varieties of flotation suit available is that fishermen will not wear them because they are inconvenient to use while fishing. We do not believe that there is any point in making it compulsory to have a suit that no one will use, and so will not in practice save any lives. We are trying hard to find a suit which we can persuade fishermen to use. If that comes about, we shall certainly consider a grant.
The Countess of Mar: My Lords, how does that compare with the protective clothing that sheep farmers are expected to wear?
Lord Lucas: My Lords, dipping sheep at sea is a new one on me, I am afraid. Sheep farmers are proving willing to wear the clothing which is currently available. I believe that they appreciate the risks they would run if they did not do so.
Lord Pearson of Rannoch: My Lords, accepting that hairnets and other items of personal apparel may be something of a Euro-myth, will my noble friend confirm whether the safety code, and any grants that go with it, will be dependent upon a long list of other items imposed by Europe? If so, would he care to name them, or is it so long that he would prefer to write to me?
Lord Lucas: My Lords, there is nothing of Europe and very little of imposition in what we are discussing. We are discussing a code which has been agreed with the industry as a UK initiative.
Lord Haskel: My Lords, the Minister has just told us that work on this code started from a report emanating from your Lordships' House four years ago. I is the Minister satisfied with the rate of progress?
Lord Lucas: My Lords, yes.

Business of the House: Recess Dates
2.57 p.m.
Lord Strathclyde: My Lords, it may be for the convenience of the House to know that, subject to the progress of business, the House will rise for the Christmas Recess on Wednesday 20th December and return on Tuesday 9th January. The House will sit at the usual time of 2.30 p.m. on Wednesday 20th December. It may also be helpful, although somewhat unusual, to announce the dates for the Easter Recess. I am therefore in a position to announce that, again subject to the progress of business, the House will rise for the Easter Recess on Wednesday 3rd April and return in the week beginning Monday 15th April.
Finally, at a convenient moment after 3.30 p.m., my noble friend Lady Chalker of Wallasey will, with the leave of the House, repeat a Statement that is to be made in another place on the former Yugoslavia.
Lord Graham of Edmonton: My Lords, in giving us advance dates, I wonder whether the Government Chief Whip would care to give us the date of the general election.

Road Traffic (Amendment) Bill [H.L.]
The Earl of Kinnoull: My Lords, I beg to introduce a Bill to provide for the prohibition of the use on roads of motor vehicles fitted with bullbars. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(The Earl of Kinnoull.)
On Question, Bill read a first time, and to be printed.

House of Lords Offices: Select Committee
The Chairman of Committees (Lord Boston of Faversham): My Lords, I beg to move the first Motion standing in my name on the Order Paper.
Moved, That the Select Committee on the House of Lords Offices be appointed and that as proposed by the Committee of Selection the following Lords together with the Chairman of Committees be named of the Committee:

V. Allenby of Megiddo,

L. Bruce of Donington,

V. Cranbome (L. Privy Seal),

V. Falkland,

E. Ferrers

E. Gowrie,

L. Graham of Edmonton,

B. Hamwee,

L. Harris of Greenwich,

L. Hayhoe,

L. Jenkins of Hillhead,

L. Kimball,

L. Lane of Horsell,

L. Mackay of Clashfern (Lord Chancellor),

L. McIntosh of Haringey,

E. Northesk,

V. Oxfuird,

L. Peston,

L. Renfrew of Kaimsthorn,

L. Richard,

B. Serota,

V. Slim,

Bp. Southwark,

L. Stewartby,

L. Strathclyde,

L. Taylor of Blackburn,

L. Tordoff,

B. Turner of Camden,

L. Weatherill.—(The Chairman of Committees.)

On Question, Motion agreed to.

Liaison: Select Committee
The Chairman of Committees: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, That a Select Committee be appointed to advise the House on the resources required for Select Committee work and to allocate resources between Select Committees; to review the Select Committee work of the House; to consider requests for ad hoc committees and report to the House with recommendations; to ensure effective co-ordination between the two Houses; and to consider the availability of Lords to serve on committees;
That as proposed by the Committee of Selection the following Lords together with the Chairman of Committees be named of the Committee:

L. Allen of Abbeydale,

L. Belstead,

V. Cranborne (L. Privy Seal),

L. Dormand of Easington,

E. Jellicoe,

L. Jenkins of Hillhead,

L. Richard,

L. Weatherill.

That the Committee have leave to report from time to time.
That the Committee have power to appoint specialist advisers.—(The Chairman of Committees.)
On Question, Motion agreed to.

Address in Reply to Her Majesty's Most Gracious Speech
3 p.m.
Debate resumed on the Motion moved on Wednesday last by Lord Denham—namely, That an humble Address be presented to Her Majesty as follows:—
"Most Gracious Sovereign—We, Your Majesty's most dutiful and loyal subjects, the Lords Spiritual and Temporal in Parliament assembled, beg leave to thank Your Majesty for the most gracious Speech which Your Majesty has addressed to both Houses of Parliament."
The Minister of State, Department of Trade and Industry (Lord Fraser of Carmyllie): My Lords, I am delighted to have the opportunity to open this last day of our debate on the gracious Speech, focusing as it does on industrial and economic affairs. I note from the list of those who intend to speak the degree of importance that is attached to this matter in your Lordships' House.
Our view is that the most important contribution that the Government can make to wealth creation, on which everything depends, is to provide low inflation and sound public finances. They are objectives that are simply stated but in recent decades have only temporarily been achieved. Permanent low inflation is the best way of encouraging the kind of long-term investment that will secure our future.
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We have made markets work more efficiently and brought market disciplines to bear on areas of the economy which had previously been sheltered from them. We have privatised 48 major industries, transferring nearly 1 million people from the public to the private sector, increasing efficiency and improving services to the consumer. Some surprising countries around the world in surprising numbers are now following our lead.
We have further improved value for money in the public sector by market testing and contracting out. We have introduced private-sector skills and expertise by means of the private finance initiative.
We have reduced the main rate of corporation tax from 52 per cent. to 33 per cent., the lowest rate among the major industrial countries. Total taxes on business are lower in the UK than in any other G7 country apart from Canada. The overall tax burden in the UK is lower than in most European economies.
We have cut business free from the tangle of red tape. We have identified over 1,000 regulations for repeal or amendment. It is our aim to put one deregulation order before Parliament every week that it is sitting.
We have reformed the labour market, reducing the powers of trade unions and giving managers back the right to manage. As a result, it is internationally recognised that we now have one of the most flexible labour markets in Europe.
Our educational reforms have raised standards. This is particularly important in a world where success or failure is increasingly dependent on skills and knowledge.
These are vital changes which have had a fundamental effect on the framework within which business operates. From reading our own press, that might not be obvious, but any perusal in the most superficial fashion of the German press will indicate how clearly that achievement is recognised there. Government do not seek to direct but believe that they have an important role to play in helping business to help itself by sponsorship and partnership.
Sponsorship is not about "picking winners". It is not about bailing out failure. It is certainly not about directing business according to some bureaucratic master plan. It is certainly not about protectionism and barriers to trade. Sponsorship is about government working in partnership with individual industries, promoting them, encouraging them to improve their performance to that of the world's best and ensuring that the Government's own activities do not damage those industries.
The DTI, the department in which I am a Minister, has set up sponsor divisions with secondees from the private sector to help understand how business operates and the challenges it faces. I and my colleagues work closely with individual industries encouraging them to improve their performance. We may not direct them but from time to time there is certainly cause to chivvy them to ensure that they match the world's best. We have taken car component makers to Japan. We have worked with the toolmaking industry to encourage firms to benchmark themselves against the best in the world.

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Ministers, excluding myself, have worked with the private sector to enhance the impact of London Fashion Week. We have published an in-depth analysis of the insurance industry. I have highlighted just three of the very many practical initiatives which we have introduced to help British business improve its performance.
A further good example of how we have helped to allow our firms to compete successfully is the way in which we have continued to work towards securing agreement to liberalising telecommunications throughout the European Union. We expect full liberalisation by 1st January 1998. This is a great achievement and is in no small part due to the UK's ability to demonstrate the many benefits to both consumers and industry of freeing up markets and exposing once monolithic state monopolies to competition. The benefits are beyond dispute. Since privatisation, BT's prices have fallen by over 35 per cent. in real terms and UK telephone prices are among the lowest in Europe. Over 90 per cent. of consumers now have a choice of operator and telephone ownership has risen to 90 per cent. from 72 per cent. in 1980.
Liberalising markets and allowing consumers and the economy as a whole to benefit from freer trade is something to which I personally attach a great deal of importance. It is essential that we maintain the momentum towards freer markets. We are working to ensure that the Uruguay GATT Round agreements are properly implemented and that negotiations continue on trade in services. The gracious Speech reinforces our continuing commitment to the long-term goal of free trade and to working for closer links with our transatlantic partners to achieve this. We are helping by identifying and breaking down barriers to trade, by maintaining the pressure for market opening world-wide and at the same time by working for an effective single market within Europe. We are tackling unfair trade practices and over-regulation not just in Europe but in all our major markets.
There is, however, another side to my department's international work. As was indicated in the gracious Speech, we shall be bringing forward legislation to implement the Chemical Weapons Convention which seeks to impose a verifiable ban on an entire class of weapons of mass destruction. This is an important measure and is one for which many noble Lords have expressed their firm support. The Bill will enable the United Kingdom to ratify the convention which promises to rid the world of chemical weapons.
Perhaps one of the most astonishing statistics that persists is that as a major trading nation we export more per head than the US or Japan. Our exports are at record levels and last year manufactured exports grew by 14 per cent., the fastest rate of growth for over 20 years. Since 1981 our manufactured exports have grown faster than in France, Germany and Japan. So far this year our exports to Singapore are up over 60 per cent., to Japan by 25 per cent. and to Hong Kong by 30 per cent. But we can, and must, do better. Less than 3 per cent. of our
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3.5 million or so firms are currently exporters. We aim to see an extra 30,000 British companies join their ranks by the end of the century.
Because we do not direct does not mean that we are standing back and are wholly detached. We provide a wide range of services to help our companies win in world markets. Our top 80 markets all have dedicated staff and we have seconded over 100 high-calibre business people from the private sector to act as export promoters. Noble Lords with recent export experience will doubtless be aware of the quality of those export promoters whom we have brought in.
Both my department and the Foreign and Commonwealth Office have taken steps recently to enhance the information and support services on offer to British business. In England, firms are able to gain easy access to the whole range of government and private sector support available through the Business Links scheme. They will soon also be able to make use of the 70 export development counsellors who are being recruited from the private sector to provide strategic advice to companies seeking to grow through exports. In Scotland and in Wales we are developing similar networks through Scottish Business Shops and Business Connect Wales.
Small and medium-sized enterprises represent a significant proportion of our economy. That is a share that has risen steadily over the last 20 years. In today's increasingly diversified economy, 97 per cent. of firms employ fewer than 20 people. In turn, they account for over one-third of total private sector employment. The great importance that the Government attach to this vital sector was illustrated by the appointment of a new team of small firms Ministers across every Whitehall department. The Government are committed to helping small firms with the management potential and business potential to grow. That commitment to small firms was underlined further in Her Majesty's gracious Speech.
The Business Link network plays a pivotal role in providing help and advice for small firms. By October of this year over 150,000 businesses throughout England were using Business Links. We have also invited representative bodies to organise a series of conferences to involve small businesses more directly in generating future policies. The series of conferences was launched by the Prime Minister in September.
The most recent of those conferences took place last week in Belfast. Had any of your Lordships wanted to attend that conference, it must be a matter of some gratification that you would not have found yourselves travelling alone across the Irish Sea. Last year saw an increase in the number of visitors to the region of 309,000 which is up more than two-thirds on the year earlier. This year visitor figures look set to break all records. More than 1 million people have travelled to Northern Ireland already. The renaissance of this valued region of the UK is in no small part due to the Prime Minister's efforts to secure a lasting peace. But it is also due to the people and businesses of Northern Ireland who are grasping the opportunity of peace with both hands. Between the first and second quarter of this year,

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manufacturing output in Northern Ireland jumped by over 7 per cent. while unemployment has fallen by nearly 10 per cent. in the year to September.
The competitiveness White Papers are more than just a showcase for government policy. They also represent the first official audit of the UK's competitive position. They have shown the enormous task that we face in improving our performance.
They show that we have lost ground to other major economies over the best part of a century, and in particular since 1945. The UK fell from third in real income per head in Europe in 1950 to tenth in 1979. In 1950 our productivity in manufacturing was on average more than 10 per cent higher than that of Germany and more than twice that of Japan; but by 1979, German productivity was 50 per cent. higher than ours, and Japanese productivity one-third higher. Our share of world trade in goods halved over the same period. We lost 13 million days a year through strikes in the 1970s. Our inflation rate averaged 13 per cent.
The 1994 White Paper reported many major improvements in our competitive position in the 1980s, which this year's White Paper showed had continued into the present decade. The 1980s was the first post-war decade in which output, investment and manufacturing productivity grew faster in the UK than in either France or Germany. In the 1960s and 1970s the UK had the slowest economic growth in the G7 and the EU. We closed three-quarters of the manufacturing productivity gap with Germany and France.
Although much of that is encouraging, we should not lose sight of the key message. We intend to publish a further competitiveness White Paper next year.
We are well into our fourth year of recovery. We have grown significantly faster than the G7 average for the past two years and we are expected, along with Germany, to be ahead of the pack again next year.
Unemployment has fallen by over 700,000 since the end of 1992 and by over 250,000 in the past year alone. Last month's fall in inflation was the largest October fall for 50 years. Underlying inflation has been below 4 per cent. for three years. No government Minister has been able to say that for more than three decades. We are now seeing the kind of investment we need to ensure that this recovery is sustained. Over the past year, manufacturing investment as a whole has risen by over 12 per cent. and manufacturing investment in plant and machinery has risen by over 18 per cent. I have taken some time to spell out those figures because they are not always noted. Indeed, they may be uncomfortably valuable.
The benefits of this turnaround in our economic fortunes are evident for all to see. The OECD—an organisation not generally known for its open line in flattery—recently described our economic performance as "impressive". But, as I am sure many noble Lords will agree, actions speak louder than words, particularly when jobs and livelihoods are concerned. The surge of inward investment that has accompanied our economic reforms is testament to our success in making Britain an attractive location for business. Since 1979, the Invest in Britain Bureau has recorded over 4,000 inward
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investment projects, creating or safeguarding no fewer than 700,000 jobs. Inward investment also brings world-class management techniques and has helped to improve the performance of domestic firms.
We continue to receive the lion's share of US and Japanese inward investment in Europe. The area for which I am responsible, the North East of England, has claimed its fair share. If the House will permit it, I should like to give just one example of the kind of investment that has helped rejuvenate Tyneside. In August, Siemens announced what will be the biggest single high-tech investment ever made in Britain, a new £1 billion semiconductor plant in north Tyneside, creating 1,800 new jobs and consolidating the UK's position as the semiconductor capital of Europe.
Of course, many different factors combined to attract Siemens to north Tyneside rather than remaining in Germany, or going to Austria, Portugal or Eire. The skilled, flexible labour force, good industrial relations, low rates of corporate taxation, to which I have referred, and the financial expertise of the City were all important factors. But one of the most important factors in that investment decision was the excellence of the UK's science base. A central part of the hid was the assurance of a steady supply of suitably qualified graduates. As such, Newcastle University was an integral part of the project team.
Our strength in science is a huge national asset, drawing in investment such as that which I indicated from around the world. Our ability to compete in world markets depends increasingly on producing world-beating, high technology, high value-added goods and services. There is clear evidence that UK firms are recognising the importance of innovation to business success. Last year, £9.5 billion worth of R&D was performed by UK business enterprises with over 70 per cent. being funded by businesses themselves. This is encouragingly a 3 per cent. increase in real terms over the previous year.
That emphasis on improved connections between firms and the science and engineering base will help us to achieve and maintain competitiveness in world markets. In the highly competitive and technologically intensive world in which our firms have to compete, it is essential that companies are fully able to understand, access, and apply scientific and technological advances. Frankly, if they do not do so, they will fall behind their competitors, and we shall all suffer. To be able to do so effectively and speedily they need good connections to expertise and skills in the science and engineering base.
My right honourable friend the President of the Board of Trade has made it clear that he attaches a particular importance to enhancing the link between industry, science and government. The transfer of the Office of Science and Technology to the DTI will, we believe, greatly aid that process. We are working hard to stimulate the dialogue and to improve the climate for business innovation, promoting best practice in business management and in the use of technology; and supporting the development and application of new technology through collaborative R&D programmes. In

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addition, the DTI focuses help on small and medium-sized firms through the schemes known under their acronyms of SMART and SPUR.
A competitive economy is vital to our future prosperity. I have outlined just some of the many ways in which the Government are providing real support to British industry
We have not shirked from taking the difficult—and sometimes unpopular—decisions which have been necessary to achieve an improvement in our long-term performance. Our commitment to low inflation and sound public finances, together with our supply-side reforms, have created an overall economic climate in which business can invest for the future with confidence.
Ultimately our success depends on the ability of our businesses to identify new ways of meeting the needs of future markets, and to exploit them successfully. The Government's role is to help them turn opportunities into new products, new orders and new jobs. Following on what was contained within the gracious Speech, we shall continue to pursue that role with vigour.
3.22 p.m.
Lord Peston: My Lords, most of my contribution in addressing the House today will deal with competitiveness, which is mentioned three times in the gracious Speech. I shall also ave some remarks to make on full employment and on fairness in the distribution of income. To make my view on general economics as clear as I can, perhaps I may offer your Lordships a quotation from Keynes which dates back to 1929. Noble Lords will recall that, throughout his life, Keynes was a Liberal and certainly not Labour, as the ignorant sometimes assert. His concern was to save free market capitalism from itself. On the subject of unemployment he said:
"The Conservative"—
and I emphasise that that is with a capital "C"—
"belief that there is some law of nature which prevents them from being employed"—
that is, the unemployed from being employed—
"that it is 'rash' to employ men, and that it is financially 'sound' to maintain a tenth of the population in idleness for an indefinite period, is crazily improbable … the sort of thing which no man could believe who had not had his head fuddled with nonsense for years and years …To bring up the bogey of inflation as an objection to capital expenditure at the present time is like warning a patient who is wasting away from consumption of the dangers of excessive corpulence".
Those who say that we need a new Keynes for the present day are mistaken. The old Keynes tells us all we need to know. Indeed, listening to the leaders of the financial community today, it is apparent that they have learnt nothing from 70 years of economic history. They are as mistaken, and as damaging, in the mid-1990s as they were in the mid-1920s. In that connection, I must note the Government's fear of referring to full employment. They refer to rising employment, but that is not the same thing at all.
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I believe that it would be useful if I, too, summarise British macro-economic experience since 1979. I agree that this is not the final summary of Conservative economic performance—that must wait until next year—but it will do for today. Average unemployment has been 9.4 per cent. in the period of this Government. It has fluctuated between 4.6 per cent. and 11.5 per cent. Total man years of unemployment—or perhaps I should say personal years of unemployment—from 1980 to 1995 have amounted to 38 million. That contrasts with a mere 16 million from 1950 to 1979 (double the period).
Gross domestic product has grown at an average rate of 2 per cent. per annum. I concede that that is certainly better than the previous five years, but it is not as good as 1964 to 1979 when the figure was 2.5 per cent., or 1951 to 1964 when it was 3 per cent. I hope that I do not have to remind noble Lords opposite who was in power from 1951 to 1964. Inflation has averaged 6.5 per cent., fluctuating between just over 2 per cent. and over 19 per cent. That, too, is better than the previous few years; but not very different from the average of 6.7 per cent. from 1949 to 1979.
The balance of payments on current account has fluctuated from a surplus of 3 per cent. of GDP to a deficit of 5 per cent. The cumulative deficit, which is so important, was actually £73 billion, which is to be compared with a cumulative surplus of some £3 billion in the whole of the previous 30 years which did not have the benefit of North Sea oil. The government budget has fluctuated from a surplus of 1 per cent. of GDP to a deficit of 9 per cent. Again, the cumulative deficit of this Government is £214 billion, all of which has to he repaid unless it is to place a permanent interest burden on the taxpayer.
Short-term interest rates have fluctuated between 5 per cent. and over 15 per cent. and long rates between 8 per cent. and 15 per cent. What is most interesting is the fact that the total tax take has varied between 42 per cent. of GDP and 50 per cent., and public expenditure between 45 per cent. and 53 per cent. I agree that the precise ratio depends on which measure of GDP one prefers. But, politics apart, no one could accuse this Government of being the party of low taxation; no one could accuse the Government of being the party of low public expenditure. The problem has been who has borne the burden of taxation, and the extent to which public expenditure has been wasted.
If we were discussing a school report, I suggest that our comment would be the traditional one; namely, "… is making progress, but needs to work harder and more systematically to do better". Unfortunately for the Government—and to continue the metaphor—they are now about to leave school, or to be expelled, leaving someone else to repair the damage. That can be said despite the one really considerable achievement, which is the improvement in manufacturing productivity to which the noble and learned Lord referred.
There has been a pronounced change in output per person and output per person hour in manufacturing. It looks as if we are catching up with some of our competitors, although my experience of research in the area tells me that we should be a little cautious about

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jumping to conclusions on the matter. We would like the improvement in manufacturing to show up much more in total output and total employment, rather than largely in the shedding of labour. We would also like to see a greater lead taken by British-owned firms. But it would be churlish of me on party grounds to begrudge the achievement that is there, especially as it looks, as the noble and learned Lord said, as if it has been accompanied, up to this year at least, with an end to the fall in our share of world trade.
Economists recognise that it is not just the level of GDP that matters in the aggregate. We must also look at how it is distributed between different groups—between the rich and the poor. The question of how much inequality is needed to provide appropriate incentives for a market economy is as old as economics itself and is not solved even today. However, most students of the subject agree that the mixed economy requires some economic incentives, but that sufficient fairness in the distribution of income is compatible with that and should still be able to salve most of our social consciences. I hasten to add that I am not so naïve as to believe that debate over a fair distribution of income is over, or ever will be. I merely insist that the topic is one which can be discussed reasonably by reasonable people.
What economists do agree on is that we should look at income distribution, in part at least, in lifetime terms. Some of the relatively poor today may, or will, be richer tomorrow. That is true of young people in education and training as they start their careers. It is also true of people in high risk professions such as the arts. Sometimes we do not wish to recognise that some who are poor today were rich yesterday and consciously took decisions which led to that outcome. One of the problems we all have to face in discussing pension provision, for example, is whether, in favouring a state pension to guarantee that poverty will be alleviated in old age—that is certainly my view—we also wish the state to limit the freedom of choice of those who wish to have no more than that for their old age. In other words, having provided a fair minimum, how far should we protect the profligate from themselves? It is not often I say this—as noble Lords are aware—but that is one question I am not certain how to answer.
Wearing my libertarian hat, I feel people should be free to choose and should bear the consequences of their actions. Wearing my interventionist hat, and especially noting how myopic people are in preparing for the future, I think perhaps the state must have a greater role. We are interested in the long run performance of the economy because that is the ultimate determinant of our economic welfare and therefore an important part of our welfare in general. What we all agree is that productivity is what determines GDP and GDP per capita in the long term. The key to improvements in productivity is technical progress. The more technically accomplished we are and the more technically advanced is our capital equipment, the higher will be our output. If we raise the rate of technical progress, we can raise our growth rate. Surely we must agree that some of that is market driven, based on the profit motive. However, some is the responsibility of the public sector to improve the
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infrastructure, for example, within which markets work. Some of that derives from basic science and engineering which is not market driven at all. Some technical progress is generated within our country but some involves catching up with the best technology used abroad.
The important point is the existence of advanced technology does not imply its use. The technology has to be incorporated in new capital equipment and that is why a high rate of investment—which we do not have—is conducive to technological progress. We have here one of the clues to the connection between the short run and the long run. Short run policies which raise interest rates, real and nominal, make investment less attractive. The knowledge that policy is devoted exclusively to dealing with inflation and will be used in a restrictive way to dampen down a boom, adds to market risk and is inimical to decisions which show their return over long periods of time. While I agree that short-termism is endemic in the business community and is not easily eradicated, I believe it is the responsibility of government not to add to it.
The possibility of excellent use of equipment does not imply that it will actually happen. Technology is the key but it has to be used. Performance depends above all on management. In my judgment, the explanation of our inferior economic performance in the past is the poor quality of too much of our management at all levels in too many of our firms. This also leads to the conclusion that economic performance depends on the quality of the labour force; on the so-called human capital which is embedded within it. There is ample evidence of the positive return from education and training, certainly from the kind of education and training which is of high quality. I am happy to note that the Government accepted that in the gracious Speech which stated:
"Increased competitiveness will be encouraged by raising educational and skill levels, advancing knowledge".
There is no point in improving a person's skills if he then finds there are no jobs for him. That is where we have gone wrong in recent years. An idle school leaver or university graduate, no matter how well qualified, contributes nothing to the economy. A person in a job which requires less than his or her full skill, but which he or she takes faute de mieux, again contributes less than his or her full potential to the economy. Those are just two more reasons why the restoration of full employment must be put back at the top of the policy agenda. Incidentally, I do not go to the other extreme and argue that all qualifications are economically productive, or ought to be. There is more to civilised life than producing goods and services as ordinarily defined. Nonetheless, there can be no doubt that the qualified worker is more productive than the unqualified, and the day of the unskilled labourer is largely over.
All this leads me to the theme of competition from low wage economies. This fear goes back to the earliest days of economics. It was what lay behind mercantilism, the destruction of the intellectual basis for which was one of the most important contributions of The Wealth of Nations. In essence the debate was all about protection and free trade. Adam Smith won the battle for free trade, but the war has continued for 200 years

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since then and shows no sign of abating. Smith not only put the case overwhelmingly for free trade, demonstrating its advantages to Great Britain, but he also took a dim view, to say the least, of those who argued for low wages. I shall quote him, as I have before. He stated:
"Our merchants and master-manufacturers complain much of the bad effects of high wages in raising price, and thereby lessening the sale of their goods at both home and abroad. They say nothing concerning the bad effects of high profits. They are silent with regard to the pernicious effects of their own gains. They complain only of those of other people".
I might add, as some noble Lords may have been led to believe the contrary, that Adam Smith, the great prophet of free enterprise, suffered no illusions about businessmen. He disliked their lack of dedication to their social responsibilities and distrusted their ethics. One more quotation will suffice:
"The government of an exclusive company of merchants is, perhaps, the worst of all governments of a country".
While my mind is on great economists, let me mention David Ricardo who, at the beginning of the 19th century, set out a theoretically rigorous foundation for international trade. Curiously, it was on that basis that economists discovered certain special cases in which free trade could be disadvantageous, but they were simply that—special cases. In broad terms—I think here the Minister and I agree—it is correct to say that the consumers of this country are net beneficiaries of free trade, and will continue to be so. I deplore the rise of protectionism, especially in the United States recently, in contrast to the leadership which it has given in this area for most of the post-war period.
It must not be forgotten that the consequence of technical progress is to make potential output higher than it otherwise would be. Everyone can be made better off. If the market mechanism operates so that some people are worse off—because they cannot or will not acquire new skills or move to new jobs, for example—the government tax and expenditure mechanism can be used to offset that. Thus, in my judgment and that of most economists, there are grounds for optimism in stressing the benefits of technical advance and free trade as long as micro-economic and macro-economic policy are adjusted correctly. I go further: technological advance and free trade go together. Our standard of living depends on our productivity and on our specialising in forms of activity in which we have a comparative advantage. We must make and export what we are relatively best at, and import what else we want.
However, what must be understood—this is where we differ so strongly from the Government—is that this has nothing to do with nominal wages. Lowering wages does not raise productivity; indeed, it may do the opposite. It will only make us competitive in the nominal sense of offsetting the effects of an incorrect exchange rate. In the gracious Speech the Government assert that,
"They will promote flexible labour markets and reduced social costs as the best means to improve the competitiveness of the European economy and create a climate for job creation".
That is about as mistaken and misleading a piece of economics as I have come across for some time.
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Of course, relative to our productivity, the more our nominal wages rise compared with our competitors, the more we must devalue the currency if we are to maintain competitiveness. That is the story of the past 15 years. Such devaluation has been amply demonstrated by the Government. But what really matters is our productivity. The logic of causality therefore is better put in this way. Given our wages and our exchange rate, the more productive we must be if we wish to remain competitive and maintain our standard of living.
Just like the perennial panic of technological unemployment, the problem of foreign competition has been with us throughout our history. It is worth emphasising that we have always solved it. Despite the scare of foreign competition and the pessimism that demands are satiated and there will be no more new jobs, we have managed for the most part to maintain high levels of employment. We maintained actual full employment from 1945 to 1979. Over the long run we have managed to employ more people than ever before and to increase our standard of living.
To leave politics altogether, I see nothing to lead to the conclusion that such a scenario is no longer possible, provided that we are sensible. One may feel that that proviso—provided we are sensible—gives the game away, but I do not. I am convinced that, despite occasional aberrations, policy makers can be persuaded to act rationally. I repeat that I welcome technical progress and foreign competition no less than I did in the past.
Competition is like a treadmill. There are always new entrants to a market with new and better products. But we must accept change at all times. To refer to my earlier example, the developing countries will compete with cheap labour, eliminating the demand for unqualified labour here. But the response to that is to go in for knowledge-intensive production, not least in manufacturing, based on the latest research and development and using highly qualified labour. I agree with the noble and learned Lord on that. The structure of production will change. There is no need for permanent unemployment or, in my judgment, job sharing, early retirement, or whatever the latest gimmick put forward by the ignorant happens to be.
I am not a defeatist like those who say that the only solution is lower wages and that we must accept large-scale unemployment. I am convinced that we can compete on technology and by improving the quality of the labour force. Far from needing to lower the living standards of our people as a solution to the problem, the reverse is true in that our history shows how we can solve our problems and raise everybody's standard of living.
However, we still need a managerial revolution to convince managers that they can succeed. After all these years we still need an entrepreneurial revolution to raise the propensity to invest and innovate. We still need a training revolution, but above all we must return to a policy of maintaining aggregate demand to restore and then ensure the continuation of full employment.
3.40 p.m.
Lord Jenkins of Hillhead: My Lords, we have had, as is habitual, a wide-ranging and long week of debate erected on the somewhat narrow foundation of a not very exciting Queen's Speech. But although the gracious Speech itself was not very memorable, there have undoubtedly been one or two memorable speeches in the course of the debate, including some maiden speeches. I recall in particular the maiden speech of the noble Earl, Lord Sandwich, and the lecture, if I may call it such—normally your Lordships do not like lectures, but on this occasion the lecture was delivered with such authority, knowledge and pungency that it was wholly acceptable—of the noble Lord, Lord Healey, in our foreign affairs debate at the end of last week.
If I may make at least one other agreeable remark, I have been much struck recently by how well, on the whole, the Government case is now presented from the Front Bench opposite. In my view, it is incomparably better done than it was when I first came to your Lordships' House seven or eight years ago. Then, the withdrawal of the noble Viscount, Lord Whitelaw, left a big void which it took some time to begin to fill. As the House would not expect me to be too flattering. perhaps I may say that the improved presentation is the more impressive as the case itself has become steadily worse. If I may be greatly daring in the absence of the noble Lord, Lord Williams of Elvel, and use a cricketing metaphor, some of the most impressive innings are those which occur on a bad wicket in fading light on a cold Tuesday afternoon at Northampton in the course of a match which is being lost. I regard the performance of the noble Viscount, Lord Cranborne, as being in that category. Nevertheless, I congratulate him and his adjutants on their buoyancy in adversity and their skill in making the best of a bad job.
I also think that the Government case is presented better in your Lordships' House than it is in the House of Commons. Indeed, I consider that your Lordships' House is performing much better overall than is the other place. The contrast between our respective handling of the difficult issue of Members' interests could hardly be sharper. It is therefore ironic that we must await, with such fortitude as we can muster, Commons' plans for our reform. Of course, we must always remember that we are logically indefensible. But it is nevertheless the case that in the vital process of restoring confidence between public and Parliament it is the Commons who are seen as the essence of the problem rather than the agents of its solution.
I turn to the prospects for the Session. First, I wonder how much harm our incorrigible Home Secretary, who is up before the courts even more often than the most hardened of his professional criminal clients, will do this Session. I hope that before he does it he will study the devastating speech which the noble and learned Lord, Lord Ackner, made on Monday of this week.
Secondly, I wonder how far the Chancellor will resist the pressures to follow the pre-election primrose paths of even such distinguished statesmen as Lord Butler, Mr. Maudling and the noble Lord, Lord Barber. Indeed, the noble Lord, Lord Lawson, also showed himself
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faithful to the tradition of Tory improvidence, but he at least did it after and not before an election and so could claim greater purity of motive if not probity of result.
To return to the present, I said in the debate last year that I thought that the 1995 Budget rather than the 1994 Budget would be the test of the Chancellor's ability to resist temptation and show at least some respect for the medium-term needs of the economy rather than short-term politics. I adhere to that view, although it did not then fully occur to me that we would this year find ourselves in a climate where competitive promises of tax cuts now, in the future and for ever more have become the dominating feature of politicians' politics. I say politicians' politics because I doubt very much whether the general public find any of those promises and counter promises either edifying or convincing. As one of our must urgent needs is to restore the confidence and respect of citizens in their government this Dutch auction takes us damagingly in the other and wrong direction. I find that at once distasteful and faintly ludicrous. It is difficult enough in practice for a Chancellor to strike a good balance between the competing claims of prudent finance, the provision of adequate public services which are essential to any civilised society and the avoidance of penal or unfair taxation when he is sitting with his advisers, with all the up-to-date facts available and, preferably, the next election several horizons away. To suggest that judgments and promises, made for unforeseen circumstances and under heavy electoral pressure, are worth more than the paper they are written on is to strain credulity.
I wish that the Official Opposition would not get dragged in to that squalid competition. They will regret it. The reputation of Mr. Brown and others will suffer as a result. The hope that a new government might establish a new relationship of trust with the public will be diminished. Nor do I think that it is necessary. I believe that Mr. Blair's repugnance for premature triumphalism was a good thing, almost a sign of grace. But that can go too far and become a debilitating lack of confidence, an obsessive nervousness about losing votes. Nervousness produces unsteady hands, and unsteady hands do not perform neat operations.
My presumptuous advice to the Opposition is to calm down and keep their nerve as well as their radicalism. My presumptuous advice to the Government is to enjoy their twilight without resentment. After a 17 hour day—17 years in Government—they ought to welcome a little repose.

Former Yugoslavia
3.50 p.m.
Baroness Chalker of Wallasey: My Lords, with permission I should like to repeat a Statement being made in another place by my right honourable friend the Foreign Secretary.
"With permission, Madam Speaker, I should like to make a Statement on former Yugoslavia.

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"The conflict in former Yugoslavia is Europe's most tragic problem. Two hundred thousand people have lost their lives over the past four years. Over 1.5 million have lost their homes. The conflict has caused suffering and destruction of a scale not seen in Europe since the Second World War.
"From the start, Britain has upheld the principles that internationally recognised borders must not be altered by force, and the legitimate rights of all ethnic groups must be properly protected by their governments.
"We have therefore had three objectives: to save lives; to draw the parties away from the military option towards a negotiated settlement; and to prevent the spread of the conflict.
"The Government warmly welcome the agreement initialled in Dayton yesterday. We applaud the work of all the negotiators. I congratulate the leaders of the parties to the Bosnia conflict, who have shown the wisdom and courage to make the hard choices and difficult compromises needed for peace. And we must recall with gratitude the work of all those who laid the foundations for this achievement: notably Lord Carrington and Lord Owen, Cy Vance, Thorvald Stoltenberg, Carl Bildt, and the American officials, who died so tragically a few weeks ago while engaged in earlier stages of these negotiations.
"The full text of the peace agreement will be placed in the Library of the House as soon as it is available. It is a detailed and complex document. I will not attempt to describe it in detail to the House now. But I would highlight some key elements. The agreement maintains a single unitary Bosnian state, within internationally recognised borders. There will be a central three-man presidency, with representatives from each of the three ethnic groups, a Council of Ministers, and a Central Parliament. Underneath these central structures, there will be two entities, the Federation and the Republika Srpska, each with substantial autonomy.
"Elections for the central presidency and parliament and for the institutions of both entities will be held within nine months of signature of the agreements. The Organisation for Security and Co-operation in Europe will supervise these elections. There are to be special arrangements for refugees and displaced persons, who will be encouraged to return and will have the option of voting where they lived before the war. Those indicted for war crimes will play no part in future public life in Bosnia. The UK continues, moreover, strongly to support the work of the War Crimes Tribunal. We believe that those responsible for atrocities should be tried. We look to all the states of the region to fulfil their international obligations. Sanctions against the Federal Republic of Yugoslavia are to be suspended immediately. They will be formally lifted 10 days after free and fair elections have been held in Bosnia. There will also be a phased lifting of the arms embargo, alongside the establishment of an arms control regime. Territorial issues were the most difficult to settle and took the talks
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to the brink. But the settlement meets the Contact Group proposal of a 49 per cent.-51 per cent. split between the Republika Srpska and the Federation. And it meets the crucial principle of maintaining Sarajevo as a united city: a principle that the British Government have supported throughout.
"It would be foolish to underestimate the size of the task that the international community now faces. The first requirement is that the parties live up to their commitments. Unless they abide by what they have agreed, and work to make the settlement a success, the documents initialled at Dayton are just pieces of paper. The history of this conflict is one of broken agreements. Now, as never before, promises must be kept.
"The international community will deploy an international force to Bosnia following signature of the agreement to supervise the withdrawal of respective armies to the agreed zones of separation. It is the wish of the parties that NATO take the lead in establishing such a force. We hope to see a number of non-NATO nations, in particular Russia, working with us in this force. Apart from the OSCE supervision of elections, the international community must also establish an international police task force to advise and train the local police forces, and oversee the establishment of the agreed central structures. The international humanitarian agencies must meet the continuing needs of the Bosnian population and monitor the human rights of returning refugees. And with the World Bank in the lead at technical level, the international community must help with the task of economic reconstruction in the region; restoring infrastructure and utilities, stimulating the development of market economies, and encouraging economic interaction in the region.
"We will therefore hold a Peace Implementation Conference in London, to mobilise the international community for the tasks ahead. This conference will ensure that the military operation meshes with the civilian, and that tasks at the crucial civilian/military interface are properly handled. It will establish a co-ordination structure with a senior political figure, the High Representative, at its centre. It will ensure that those supervising the elections, assisting with economic reconstruction and undertaking humanitarian tasks, will work together as part of a coherent implementation plan. And it will help to pin down the parties' agreement to the details of implementation.
"We must also decide nationally how we shall contribute to peace implementation in Bosnia. We expect to play a central role alongside our American and French allies in a NATO implementation force. In particular, I should emphasise that the early commitment of the substantial US ground troop presence which the US Administration proposes is a prerequisite for our participation. We expect to arrive and leave alongside our American and French allies. But we now need to study the details of the peace agreement. We must ensure that our forces would be acting in conditions of reasonable safety, that they

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would have the consent of the parties, and that the burden is being shared equitably among allies, before we take final decisions.
"The agreement in Dayton is an historic event. An end to the brutal and tragic conflict in former Yugoslavia is now within our grasp. But we are not there yet. With the London Peace Implementation Conference, and a British contribution to a peace implementation force in Bosnia, Britain will play a central role in ensuring that the agreement in Dayton is translated into a peaceful future for all the people of the region".
My Lords, that concludes the Statement.
3.59 p.m.
Lord Richard: My Lords, I thank the Minister for repeating the Statement made by her right honourable friend in another place.
Perhaps I may begin by echoing what she said about the agreement. I should like to express very firmly our welcome to and our pleasure at the agreement that has been reached. However one looks at it, it is a remarkable diplomatic achievement by the United States who deserve great credit for it, as does President Clinton. I expect too that exile in Dayton, Ohio, may have helped a little on the margins. It is a tribute also to the effectiveness of economic sanctions imposed on Serbia. Sanctions have not always worked in the past, as we all know, but;n this instance they clearly seem to have had an effect in persuading President Milosevic that the time had come to settle. However, the real test is to come when the negotiators get home. It is a truism that for an agreement to succeed it must stick, but nevertheless it is true, particularly when, as in this case, it is not a settlement that has been dictated on the battlefield by any victor; it is one that has been brokered by outside mediators.
I wish to put a number of specific points to the Minister, some of which I hope she will be able to answer. First, does she have any indication as yet of the attitude of the Bosnian Serbs to the agreement? At lunchtime on the news there were signs of dissatisfaction. I am not sure how deep they run nor precisely what is happening. If she can give the House any information on that, I am sure we would be grateful.
Secondly, the Minister mentioned the provision of troops. Can she confirm the figures in the press that a commitment of 20,000 American, 13,000 British and 10,000 French soldiers is envisaged, together with some contingents from our other NATO allies? I agree that what is crucial to success here is the commitment of United States troops. We know that Mr. Clinton has his problems with Congress. I wonder whether the Minister has any assessment of the likelihood of Congress blocking this proposal. She obviously has an assessment because she will have received one from our officials in Washington. Presumably the Government reckon that the proposal will go through Congress and it will therefore go ahead. I am grateful to the Minister for spelling out that if the Americans do not commit their troops then neither will we be bound under the agreement to commit our troops.
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Thirdly, what mix of troops is envisaged? Will they be relatively lightly armed peacekeeping forces or are they to have heavier weapons and to be capable of being employed in a more active role? Can the Minister say anything about the chain of command as regards NATO forces? How is the agreement to be associated with the United Nations? I suppose that there has to be some kind of Security Council cover. I wonder whether the noble Baroness can say one or two words on that.
There are not many details in the Statement and, having listened to the Minister reading it, I am not sure precisely how the civilian and the military sides will mesh together. I believe that I am capable of understanding the military side, but as to the civilian side with a police task force, I am not sure what that force will do. The Minister said that it was to train the local police forces and to oversee the setting up of the necessary central constitutional structures. It is a strange role for a police force, but if that is what the parties want then we should not cavil at it. Will Britain contribute to it? If so, what kind of contribution might we be asked to make? How do we view the possibility of that contribution?
Finally, I repeat our welcome for the agreement. For all the fine words and the constitutional structures, Bosnia is to be de facto divided. I hope that the divided parts may now, after the years of war, at least be able to acquiesce peaceably in each other's existence.
Lord Thomson of Monifieth: My Lords, I join the noble Lord, Lord Richard, in thanking the Minister for repeating the Statement made in another place. Undoubtedly, the Dayton agreement is the best hope that we have of ending the horrors of the war in the former Yugoslavia. That hope far outweighs what must remain our deep sense of dismay about the brutal ethnic cleansing that will be left behind if the tide of war truly retreats.
There are some hard lessons for European governments arising out of the Dayton agreement. With European help and support, the United States has succeeded where Europe, with American help and support, failed in the past. That emphasises in the first place the importance of maintaining the Atlantic alliance in modern conditions. It equally emphasises the need to improve the European Union's capacity for joint foreign policy making and joint operations in the defence field.
We will want to study the details of what is an obviously complex agreement. I join the noble Lord, Lord Richard, in hoping that there will be answers to the questions that he has put. We will all be anxious to know something about what will be the rules of engagement for our troops in this new operation, led by the major nations within NATO. We could do with some further information than the Minister was able to give us in answer to an earlier Question today about the reaction of Russia to the agreement, what is likely to be the Russian role and to what degree the Russians are ready to co-operate in the military arrangements that have been proposed. We would also like to hear what will be the juridical backing for the NATO-led military operation within the United Nations.

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Finally, it would be interesting to hear from the Minister some of the Government's ideas about the part they may play in what will undoubtedly need to be a massive operation of international reconstruction, to help to bind up the wounds of war in the former Yugoslavia. If that can be done successfully, it might do more than anything else to create a better sense of unity in Bosnia Herzegovina than will exist immediately with the complicated, divided arrangements that are proposed in the agreement.
The truest words that the Minister used in the Statement that she repeated were:
"Now, as never before, promises must be kept".
I hope that they will be kept all round.
Baroness Chalker of Wallasey: My Lords, I thank both the noble Lord, Lord Richard, and the noble Lord, Lord Thomson, for their comments. All the answers are by no means yet available, but I shall do my best to give as much information as I have to hand.
The Bosnian Serbs' attitude will seem to waiver for a while, but one has always to keep in one's mind that they agreed that Mr. Milosevic would negotiate on their behalf. That was agreed before Dayton and, therefore, were they to try to run out on the agreement now, Mr. Milosevic would have something to say.
The noble Lord, Lord Richard, asked me about troop figures. All I can tell him at the moment is that, yes, it is absolutely crucial that we have that commitment of US troops to go in. The noble Lord will have noted that I said that we would go in with them and the French troops and we would come out with them Therefore, whatever Congress may be debating at the moment, it will have a strong case put to it for co-operating. If it were not to co-operate, then the Dayton agreement would be in considerable doubt and that would then be set at the door of Congress.
I cannot confirm absolutely what the numbers would be, but it is about 60,000 in total. Around 13,000 or 14,000 would come from this country. I cannot yet confirm the mix of troops except that non-NATO countries will be among them; which ones I am not yet able to say, but some will certainly come from the countries involved in the Partnership for Peace. We see that as a positive contribution, including, of course, the contribution that the Russians particularly wish to make.
The United Nations cover has yet to be worked out in detail. There is no doubt that, as the noble Lord said at the beginning, the United States has been out in front, but I have to pay tribute to Pauline Neville-Jones in the Foreign Office and her team. To be cooped up for the past three weeks in the Dayton military base may have concentrated the mind, but it was pretty tough going and they have come out with the framework agreement which we wanted and for which the United Kingdom has worked so hard. Both the framework agreement and the annexes thereto were discussed among all five of the contact group delegations; namely, the United States, the United Kingdom, France, Germany and Russia, before they were presented to the parties who agreed
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them yesterday. There was very formidable expertise in that contact group. Carl Bildt's team contributed extremely valuably during the negotiations.
The UN forces were neither mandated nor equipped to fight the war in Bosnia. That is why they could never impose peace in the past. But we now have an agreement. We should never forget that, in the past, 2.7 million people were kept alive through three successive winters. Winter is upon us and we must get on with the reconstruction as well as with keeping people going until reconstruction can start. We therefore have a major job ahead of us.
The exact UN arrangements are yet to be worked out. I will give the noble Lord and this House the detail as soon as I am clear what it will be. We are working now towards the peace implementation conference that is to take place in early to mid-December in London. That will help us decide, in the noble Lord's words, how to mesh together the essential civilian and military components of the peace settlement.
The Atlantic Alliance will play a crucial part. As I said earlier in answer to a Question in this House, IFOR, the international implementation force, will be NATO led. As the noble Lord, Lord Thomson of Monifieth, knows, we do not discuss rules of engagement. Anyway, we are quite a long way away from that sort of thing. We hope also that the troops will not have to be engaged in the way they were under UNPROFOR. We are fairly certain that there will be a high degree of Russian co-operation. The Russian commander will be one of the deputies to SACEUR. I was asked earlier in the day about the detail of command and control and whether it was wise to bring the Russians in. We must leave it to the good sense of the NATO commander to work out a system whereby we can make the peace in Bosnia work. But at no time will we ever allow this country or any other NATO member to be vulnerable as a result of the rules that are worked out for implementation in Bosnia.
The United Kingdom will play a fairly major role in the reconstruction. But we hope very much that it will be an enabling role, one that helps a market economy to start up again in Bosnia and helps companies there to work on reconstruction under the direction of a World Bank-led plan. We have, of course, been one of the contributors to reconnecting the basic utilities and to keeping life going in former Yugoslavia over three and a half years. We shall continue this job to bring matters to a successful end.
4.15 p.m.
The Earl of Lauderdale: My Lords, is my noble friend aware that her mention of the Russians taking part in the top machinery of this project brings a great deal of relief to those of us who wonder how realistic the whole project is? There is talk of a single Bosnian state when citizens there have been tearing each other apart for the past three years. There is talk of democratic elections when they have only just put away their guns, if indeed they have done so. Those of us who know the Balkans are struck by a certain air of unreality. With the Russians plum in the middle of this process, one is a little more hopeful now that it might work.

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My noble friend mentioned refugees returning to their homes. The Krajina refugees will find that their homes have been torched. There are not many homes to go to. Therefore in the whole reconstruction effort it will require a lot of imagination and improvisation even to put roofs over the wrecks of the houses that are left. Is my noble friend really happy about the participation of NATO? Is there not a danger that NATO will be sucked into a world-wide rapid reaction force role to which it is in no way fitted and to which it is politically unsuited?
Is it not faintly unrealistic to talk about democratic elections among people who were not even at peace a month ago? We look forward to democratic elections here. I see opposite me noble Lords of great eminence who, I know, will not pull a gun on me the next time I stand up to speak. But we cannot be certain that that will not happen in Bosnia. Indeed, the story of the first Yugoslav parliament is one that brings to mind the two red lines in the other Chamber here which are two and a half sword lengths apart. They would need in this case to be two pistol shot lengths apart. This whole project has about it the scent of unreality. How people are to return to houses that have been destroyed I do not know. How people are to agree to respect each other's behaviour in a democratic election when only a month ago they were killing each other beggars imagination.
I have another question for my noble friend. We realise that there are two technical problems of great difficulty. One is the Brcko corridor; the other is the Moslem corridor to Gorazde. Has thought been given to the possibility of a sort of concrete fly-over, which might provide a physical answer to the political difficulties? Obviously, the corridor is very important to those who are interested. One wants to make quite sure that people there will not be destroyed, undermined or interrupted by hostile forces from either side. The idea of a concrete fly-over may possibly make sense in this connection.
Baroness Chalker of Wallasey: My Lords, my noble friend has put his finger on one of the biggest problems with which we must deal; namely, the refugee returns, which wall be very difficult. It is not just a matter of those from Krajina, but of people of all backgrounds from all over former Yugoslavia who have had their hornes torched. The reconstruction will be on a very large scale. However, we hope to help those people to be involved in the reconstruction of their own homes under the guidance of the World Bank. The programme has to be worked out in great detail. I shall shortly be going to discuss the particular problems of the Serbian refugees, who have not been part of the general concern in the past. For this process to be successful one has to settle all the refugees in the best possible way.
In regard to NATO not being suitable so far as a rapid reaction force is concerned, I really do disagree with my noble friend. NATO is eminently well able to be the rapid reaction force and has indeed been so since the bombing in Sarajevo market in August. It was the NATO led rapid reaction force, with many brave Britons involved in it, which helped to turn the tide and lay the foundation for what has subsequently happened at Dayton. While the agreement at Dayton may he very
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difficult to comprehend, even for those of us who seem to have lived with it day and night over the past three weeks, I can assure my noble friend that it has a far better chance than anything we have seen before.
So far as the two corridors are concerned, there is a problem of access to territories on either side of them, as my noble friend mentioned. However, I am not sure that building unsightly concrete fly-overs would be the best way of resolving the difficulty. I believe that there will have to be some road building in the area. These are the sorts of questions that the high representative will be responsible for helping work out with the World Bank team. That will follow on from the peace implementation conference to which we look forward next month.
Lord Beloff: My Lords, following the question of my noble friend Lord Lauderdale, does the Krajina come within the competence of the new economic rehabilitation machinery or is that confined to Bosnian territory? Are we talking about something for the whole of former Yugoslavia or are we speaking of machinery to deal with the particular problems of Bosnia?
Perhaps I may also ask for illumination on what the Minister meant when she remarked that the United Nations was going to suspend and eventually abolish the sanctions on federal Yugoslavia and also—as I understood it—lift the arms embargo but with a measure of arms control. I was not clear how the arms control stood in relation to raising the embargo. Does it mean an embargo on some kind of armaments or armaments from some quarters? To my mind there is some ambiguity. I shall quite understand if the Minister finds it difficult to answer now but I feel that we shall probably need to return to it.
Baroness Chalker of Wallasey: My Lords, I thank my noble friend for his questions. Very few people have seen the final map which was agreed by the three parties in Dayton. Therefore I cannot with certainty answer his question on the Krajina. I understand it to be the case that those areas which have been devastated need to be included in the overall reconstruction because whoever is going there must have somewhere to live and be able to function. I shall come back to the noble Lord with some more detail when I have seen the map and indeed when the decisions have been made about how the implementation will be carried out.
With regard to the noble Lord's comment about suspension of the arms situation, I understand that it will be done in two stages. But there will need to be monitoring before lifting of the embargoes is completely finished. That is why in the Statement he will find that we refer to the,
"phased lifting of the arms embargo, alongside the establishment of an arms control regime"
in order that—this was not in the Statement—no build-up of arms of a similar nature as has happened in recent years can happen again. I cannot tell the noble Lord more than that at the moment but I shall keep him informed on the issue.
Lord Bruce of Donington: My Lords, I have only one very short question. Can the noble Baroness give

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the House any information at all about the attitude of the Federal German Republic to the arrangements that have been so happily reached in the United States? I shall quite understand if she finds it inconvenient to reply to that question. However, she will recall that there was unilateral political action taken by Herr Kohl in the recognition of Croatia, which rather influenced the events that happened afterwards.
Baroness Chalker of Wallasey: My Lords, all I can tell the noble Lord is that Germany, being one of the five countries involved in the contact group, present and active throughout at Dayton, must be party to all that was eventually put to the three warring parties gathered at Dayton. Therefore, the Germans must have signed up to everything of which I have spoken this afternoon and indeed to the full implementation. I understand the anxieties implied by the noble Lord but I feel that it is better to look forward in this case and not back.
Lord Geddes: My Lords, if the figure of 13,000 British troops is, roughly speaking, accurate, is my noble friend entirely confident that we have sufficient troops—I bear in mind Options for Change—to fulfil that role without overstretching those troops' duties elsewhere? Secondly, would she be kind enough to tell us, in view of the parlous state of the United Nations' economy, who will pay for those troops?
Baroness Chalker of Wallasey: My Lords, my noble friend presses me in asking about troop numbers. I am quite certain, having had as many as 12,000 British troops deployed at one stage through the UNPROFOR forces, that we can manage 1,000 or 2,000 more without any great difficulty and, indeed, we are ready to do so.
So far as concerns the state of UN finances, obviously that is a matter for the international financial institutions. It must now be worked out in detail who pays for what and I was very careful in the Statement to make it absolutely clear that Britain, having shouldered a very large burden over three years, looks to other countries to play their full part alongside us in the implementation of this peace.
Lord Harris of Greenwich: My Lords, perhaps I may return to a question put by the noble Lord, Lord Richard. In his Statement, the Foreign Secretary referred to the creation of an international police task force. I assume that we shall be making a contribution to that force. What is the scale of that contribution likely to be? Obviously, it is an extremely important part of the overall agreement and it would be of considerable interest for us to be told what our contribution is going to be.
Baroness Chalker of Wallasey: My Lords, I thank the noble Lord for his question. He may know that we already contribute to policing work in Mostar through our earlier agreement with the federation. But in this case we believe that we can play a greater role. The numbers have not yet been worked out but there is no doubt that the nine officers who are already with the Western European Union police contingent in the administration at Mostar have more than proved their worth in planning, core training and co-ordination. We
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hope that under their guidance a similar system can be deployed. I regret that I cannot give him the detail at the moment. We have not even got to the Peace Implementation Conference. There is a great deal of work to do. Our willingness to do it must be matched by others' willingness to participate and to pay.
Lord Vivian: My Lords, can my noble friend say whether any time embargo has been placed on the British, French and American troops from the time of their deployment in former Yugoslavia?
Baroness Chalker of Wallasey: My Lords, no absolute finite time embargo has been decided but we are thinking in terms of one year to start with. It may have to be extended. We have to be realistic about the kind of progress that can be made within a year after all the terrible years of conflict.
Lord Mackie of Benshie: My Lords, I welcome the Statement repeated by the noble Baroness. One must praise the efforts and the success of the United States in bringing about a possible end to this conflict after many years. Does she agree that western Europe needs to look very carefully at where it is going and where Western European Union should go? Although our troops and volunteers have done tremendously good work bringing food and relief to Sarajevo and other places, would it not have been far better if we had been able to take a robust and collective attitude at the start and put in a rapid reaction force at that time instead of trying to relieve the distress which has gone on for three years? When it comes to Serbs breaking promises, is it not also true that we are gravely at fault in that we did not fulfil the threats that we made and put ourselves in a position where the Serbs knew that they could take advantage? I do not want to blame people, but is it not the case that we must get our act together in Europe instead of relying on the United States to pull our chestnuts out of the fire?
Baroness Chalker of Wallasey: My Lords, the noble Lord, Lord Mackie of Benshie, is being a little unreasonable. It was by no means just the United States. The agreement at Dayton could not have been achieved without the help of France, Germany, Russia and the United Kingdom. There has certainly been no lack of will on the parts of France or ourselves at any stage to try to resolve these issues. The noble Lord may be right that there needs to be a clearer strategy for the way in which western Europe is proceeding on a number of fronts, but in relation to this matter and many other aspects there is no doubt about what we, our French partners, and the Germans are seeking to do.
Regarding the force to implement the peace, it is right and is clearly what was needed a long while ago could we have achieved it that NATO should lead the international implementation force. NATO is a co-ordinated, combined force. Some of our difficulties in the past were due to the fact that many of the troops who served bravely and well had never served as part of NATO. However, we cannot turn back the clock in the way that the noble Lord seeks to do and accuse Europe of breaking its promises. The French and British have nothing to be ashamed of in all they have done in

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the past three-and-a-half years in Bosnia. Without their help and knowledge now we would not have achieved the Dayton agreement.
Lord Desai: My Lords, I wish to ask the Minister about the reconstruction and development efforts that will follow. The noble Baroness said that the World Bank would take a lead in this matter. I do not believe that the World Bank has much experience in this area. Would not the European Bank for Reconstruction and Development be more appropriate?
Baroness Chalker of Wallasey: My Lords, the major reconstruction programme will be spread right across the international community. That is why the international financial institutions, of which the World Bank is a leader, will lead on the financial aspects of the reconstruction. They have the relevant experience. They have the experience which, with respect, the European Bank for Reconstruction and Development does not have in hand to help make some of the changes that need to take place. They are far better placed to ensure that there will be further burden sharing with the United States and Japan. That is a critical matter. Also, we should look at reconstruction not only from the point of view of getting the infrastructure jobs done, but also as regards some carefully targeted help which will assist Bosnia in its transition to a market-based economy. In that regard Britain has unrivalled experience through the know-how funds.

Address in Reply to Her Majesty's Most Gracious Speech
4.33 p.m.
Debate resumed.
Lord Harris of High Cross: My Lords, there being unhappily no engaging maidens to divert us as on previous days in this debate, it falls to me to resume the debate on the gracious Speech.
Before turning to the hopes for growth and rising employment in the gracious Speech, I want to follow the example of the noble Lord, Lord Jenkins, as amiably as possible with some peace offerings to both sides of the House, to both the Tory and Labour Parties. Unfortunately, my compliments do not extend to the Liberal Democrats, except to the witty, pointed and even too brief speech of the noble Lord, Lord Jenkins. However, I cannot offer any compliments on his wholly illiberal defence of high taxation.
To the Opposition I offer totally genuine and sincere congratulations on their recent promising progress towards acknowledging the economic potency of competitive markets, splendidly expressed today by my old friend and adversary the noble Lord, Lord Peston. It seems to me that Mr. Blair and his friends have signed the pledge against collective worship in public at the shrine of primitive statism. Though the Tories fear the result of that remarkable conversion, I welcome "new Labour" as a convert to what its leader, in candid moments, openly celebrates as the "dynamic market economy". At least until the general election we shall
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hear no more talk of punitive taxation; no restoration of trade union power; no disinterring of nationalised dinosaurs; no indiscriminate subsidisation; no more scoffing about monetary policy against inflation and, I am glad to say, less of the fatal conceit that apparatchiks at the centre know better than dispersed initiative and consumer choice.
It would be lacking in the objectivity expected from the Cross-Benches not to extend equal congratulations to the new Conservative Party—new, that is, since 1979. Why else would Labour suddenly change its spots and even its carnivorous nature if not for the courageous example of the noble Baroness, Lady Thatcher, in demonstrating that old Labour was unelectable?
In the spirit of emerging consensus, I shall start with a carefully worded proposition that follows well the speech of the noble and learned Lord, Lord Fraser of Carmyllie. Despite solid gains in domestic productivity and international competitiveness which he outlined, there remain serious grounds for dissatisfaction with the performance of our economy, not least in the stubborn persistence of high, long-term unemployment. In order to carry Labour's education further forward, I chose a text from a Left-wing source that it would generally admire much more than I have done or currently do. My mystery voice was reported recently as urging,
"government spending cuts, lower taxes and a partial dismantling of the welfare state, as the only way Britain can compete with the dynamic economies of East Asia".
I start therefore, as economists often do—and the noble Lord, Lord Peston, occasionally—with the latest Blue Book on UK national accounts for the period 1984–1994. During that decade net national income more than doubled from almost £300 billion to over £600 billion. Allowing for inflation, real net national income rose over that decade by a useful but fairly modest 30 per cent. During the same period total government expenditure almost doubled from around £150 billion to £290 billion. Again allowing for inflation, spending rose by almost 20 per cent. National income up by 30 per cent. and government spending by 20 per cent. means that both the Government and the Opposition are correct when they say variously that government spending has risen and that it has fallen. It has risen in absolute terms, but it has fallen as a proportion of a more rapidly increasing national income.
The first question I should like to ask both Front Benches is how we explain that, with the Government disposing of almost half the national income, Labour still finds it possible to convey a picture of a country seething with discontent. Not only Labour: is anyone satisfied with the so-called welfare state which takes 60 per cent. of our large national budget? We have discontent among suppliers—doctors, nurses and so forth—and discontent among the customers of the welfare state in schools, hospitals and so forth. At times the entire public sector seems like a workhouse that is full of Olivers always asking for more. But it already takes 60 per cent. of the budget and the budget takes almost one half of the national income.
The second question is this: would anybody seriously claim that taxpayers get as good value from the half of their income spent by government as they get from

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spending the other half for themselves? Noble Lords should reflect on the material progress which has transformed ordinary life in the post-war years. It has given people better homes and gardens and most of them have motor cars, television sets, videos, microwaves and foreign holidays. How little of that is thanks to government and how wondrously the market has satisfied our changing and developing preferences!
My third question goes to the heart of the economies of the west and not just of the United Kingdom. Does anyone really believe that economies carrying such a burden of government are likely to perform particularly well in a rapidly changing world? That suggests a whole crop of further questions. Is there any conceivable way of raising that kind of money in taxation without severely damaging efficiency and wealth creation? Does anyone know of a "good" tax? I personally favour a shift from income tax to VAT as being less damaging and less distortionary to the economy. However, as a declared chairman of FOREST and a frequent smoker, the penal tax on tobacco has now reached the stage where it encourages smuggling from the Continent of hand-rolling tobacco to the sacrifice, at the last count, of £580 million to the Exchequer. The sale of cigarette paper is going through the roof and that of hand-rolling tobacco is going through the floor. That situation has been achieved by these absurd penal taxes.
No one any longer doubts that high income tax discourages enterprise and encourages avoidance. The tax on low incomes increases the attraction of social benefits and dependency, and is a cause of what Lord Keynes himself called "voluntary unemployment". Above all, whatever the initial impact of a tax, its incidence is ultimately upon the productive powers of the economy. In short, I am arguing that high taxes not only depress taxpayers, but they also depress growth and employment, which are the targets sought by the gracious Speech.
The truth is that while Mr. Blair and his colleagues are struggling bravely to liberate their party from the last vestiges of collectivism, the new radical agenda is moving on. To meet the unprecedented transformation that we are seeing in technology and foreign trade, we have urgently to devise new programmes for reducing government spending from nearly one half to nearer one quarter of the national income. I was encouraged during the vacation to read the stimulating and uplifting text of the noble Lord, Lord Skidelsky, The World After Communism. He pitches tax as a proportion of income at 30 per cent., but then he is on the Conservative Benches and from these Benches I am advancing to 25 per cent.
Social benefits now cost almost £100 billion a year. Frank Field has bravely picked up the banner of selectivity in welfare, first raised in the 1960s by the Institute of Economic Affairs with which I then had some connection. In those days we incurred the ire and odium of people like Richard Titmuss and the old-fashioned paternalists of all parties. With rising incomes and increasing private provision, as Mr. Blair has said, I would add that success in targeted anti-poverty policy will come to be measured not by
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how much we can spend on welfare, but how little we need to rely on damaging, destructive and distortionary taxes.
Labour has recently taken to accusing the Conservatives of lurching to the right. Let me now reveal my "mystery voice" from the left which I quoted earlier as calling for lower taxes and the partial dismantling of the welfare state. Who was this monster? It was none other than that champion wet, Christopher Patten. He was speaking here about his experiences in Hong Kong, where he boasted that the top income tax rate of 15 per cent. is paid by only 2 per cent. of its prosperous workers.
In conclusion, I urge Tories to keep lurching towards Mr. Patten's vision of Britain as a low-taxed rival to the Asia tigers. It should be low-taxed rather than low-waged. I agree with the noble Lord, Lord Peston. The alternative to looking east is not to stand still, but to risk our economy, with the rest of Europe sliding west.
4.45 p.m.
Lord Prior: My Lords, I suppose it is appropriate that I should be called to speak between the noble Lord, Lord Peston, and my old friend, the noble Lord, Lord Harris of High Cross. I suppose that I would find myself somewhere in the middle. Having said that, I find myself at least responding to the questions that the noble Lord has just asked. I believe that they require an answer. I was delighted to see the speech of Mr. Christopher Patten, although I am not certain that all his experiences in Hong Kong have redounded to the benefit of this country, but that is a subject for another day.
As regards the speech of the noble Lord, Lord Peston, he was a little selective in his choice of some of his statistics and also in some of the periods which he took for them. I felt that if ever by any mischance he found himself sitting on the Government Benches—perhaps on the Government Front Bench—I would have some delight in quoting back to him in later years quite a bit of his speech. It was a good, robust opposition speech, but it did not have much reality in relation to the problems that the Government face and perhaps his party may one day have to face.
I find the economy in pretty good shape. I welcome this debate in particular, coming as it does before the Budget. I believe that one of the improvements in having it in November or early December is that it gives noble Lords and the other place the chance of proper debate before the Budget takes place as we have the Queen's Speech in front of it. I believe that the Chancellor has done a very good job extremely well over the past three years. We have had steady growth, a steady fall in unemployment—although a great deal still remains to be done—and reasonably low inflation. We have had no housing boom and people now buy houses in which to live rather than as a hedge against inflation or as a means of getting a bigger mortgage in a year or two to spend money on other things. We have had no retail boom. Most retailers may not like the slack trade at the moment, but they do not want to go back to the boom and bust of previous years.

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My advice to the Chancellor—not that I anticipate that he will accept it—is not to throw away the good work that he has done over the past three years. We do not want any irresponsible tax cuts. I follow entirely what the noble Lord, Lord Jenkins, had to say on this subject. I say to him that we should perhaps take a leaf out of his book on William Gladstone, which I believe is one of the great biographies that I have seen and read. Mr. Gladstone introduced his Budget of 1853 after Mr. Disraeli had had a rather unfortunate experience. Mr. Gladstone had said that he was very much against income tax, but he found himself having to defend it. At the same time he suggested that if it kept stable for three years, after that time he would start to reduce it by 1 per cent. at a time. That is a graduation practice that might well be followed by the Chancellor in his Budget next week.
I think that the politics of it point to behaving with great sense and without recklessness. There should not be any binge because that would undoubtedly be followed by bust later on. Perhaps I may suggest to the noble Lord, Lord Peston, that we can leave that to his party because every day now we hear some new initiative from the Labour Party about reducing taxation or promises not to put it up. Those words are always accompanied by promises of increased expenditure on practically every facet of government policy. We are told that all that can be safely accomplished by stepping up the rate of growth and that if we return to a growth rate of 4 per cent., we shall have no problems. My mind immediately goes straight back to the ill-fated national plan of 1965 which was introduced by the late George Brown. That led to total disaster. This time round it would not take a quarter of the time to lead to disaster that it took last time because world markets are much more difficult now than they were 30 years ago. Furthermore, our lurches from booms to bust over the past 30 years have made our economy much more vulnerable than at that time.
That is all that I want to say about the economy, but I should like to turn now to the trade sector. I declare an interest as chairman of GEC. I should like to commend particularly the vigour and work of our foreign missions and embassies which I believe are now doing an exceptionally fine job throughout the world. About five years ago I was critical in this House of the Government's attitude towards exporters and manufacturing industry and of their failure to give British industry the drive and example that it needs. I believe that there has been a transformation over the past few years. I find the officials at the Foreign Office helpful, well informed and the envy of a good many other countries. In fact, I think that I saw something that I should not have seen the other day from an American source, describing the various aids and forms of help that various countries give their exporters compared to that given by the American Government. The report on Britain showed that our foreign service and the efforts made by our embassy and Government were considered by the Americans to be the best in the world. It was nice to read that from an American source.
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However, the path to trade is never easy and I should like to take the House for a few moments through a problem that I have recently encountered. About a month ago I spent a week or so in the Middle East, including Saudi Arabia. I found there anger and intense resentment that we should be permitting a Saudi national bearing a Yemeni passport and using a false name to obtain a visa, to come here and then to abuse the privilege of his temporary residence by running a hostile campaign against a state with whom for many years we have had the most friendly and cordial relations and with whom we do a great deal of trade, particularly in high technology, thus involving the sort of jobs which the noble Lord, Lord Peston, says that we should support.
I am not arguing the relative merits of the asylum policy as evidenced in the Queen's Speech, but our approach to political asylum is based on the 1951 United Nations Convention on the Status of Refugees which has been in general incorporated into British law. It is in need of revision. Furthermore, it seems to me that the ever-increasing speed of communications will lead to greater opportunities to abuse a system which was established before the days of the fax and the satellite, which were never dreamed of by the drafters of the convention. Under current legislation it is not an offence to conspire in the UK to commit a terrorist act in another country. Surely that cannot be right, and surely it should be made clear that we will not tolerate incitement against a friendly power by those seeking asylum.
I should like to quote from an article in this week's Economist, commenting on the bombing of one of the national guard's headquarters in Riyadh just over a week ago. A shiver went down my spine when I read the headline because only two weeks previously I was visiting GEC employees working there, and I thought for a moment that two or three of the people to whom I had spoken had been murdered. So I have strong feelings on this subject. An article in the Economist stated:
"The Committee for the Defence of Legitimate Rights, which conducts anti-regime propaganda from London, insists that it is calling for change by political means alone. But it has been stirring up feeling against the American presence in Saudi Arabia—large and conspicuous since the Gulf war—and does not condemn the young and impatient who may seek other ways: 'We say it is not effective, but we cannot say it is a crime'",
The Economist then stated:
"That is dangerous and provocative stuff".
Indeed, it is extremely dangerous and provocative stuff that there should ever be an incitement to violence and terrorism which could affect a very friendly nation such as Saudi Arabia where, as I have already said, we have considerable trade interests.
Therefore, I urge the Government in their own interests to look carefully at the legislation and to heed the warning that I am giving this afternoon; otherwise there could be serious consequences for our trade. Having said that, my general advice to the Government is to act with prudence and honour and political rewards will follow.
4.58 p.m.
Lord Barnett: My Lords, of the last two speakers, I normally find myself agreeing more with the noble Lord, Lord Prior, than with the noble Lord, Lord Harris of High Cross. However, on this occasion I was rather surprised by at least one point raised by the noble Lord, Lord Prior. He said that people are now buying houses in which to live rather than invest. My understanding and information from the house builders and estate agents to whom I talk is that they are not doing that at all. Indeed, that is one of the problems at the moment.
As the noble Lord, Lord Harris of High Cross, probably knows, I usually disagree with him on economic matters and I do not agree now with his total support for Mr. Blair and Mr. Brown, as I shall make clear a little later. Indeed, I disagree with my right honourable friends and I hope to explain why.
It was fascinating to listen to the noble and learned Lord, Lord Fraser of Carmyllie, who opened the debate. According to him, everything is so wonderful. I could not help wondering why we need a Budget next week. It is all going very well. Indeed, the noble Lord, Lord Prior, said virtually the same thing: we do not need a Budget, we have it now. The economy is running marvellously. The Minister hardly referred to anything about the economy in the Queen's Speech. So perhaps I may be forgiven if I repeat some of the somewhat meaningless and contradictory words in the Queen's Speech:
"My Government will continue with firm financial policies designed to support economic growth and rising employment, based on permanently low inflation. Fiscal policy will continue to be set to bring the public sector borrowing requirement back towards balance over the medium term. The share of national income taken by the public sector will be reduced".
With great respect to the Government, it just ain't possible to do all that at the same time. That is the real problem of the Queen's Speech. You need to be something of a magician to carry that out in the first year. There may be one or two magicians in the Government—I suppose that is possible—but I find it hard to believe that the whole lot of them are magicians. There is no indication that they will be able to carry out all those policies next year.
Economic growth this year, we know as a fact, is declining. Unemployment has been falling, happily, as we have been told, although this month there was a small increase. So we are told that it is a statistical aberration. Indeed we are always told it is a statistical aberration when something is wrong. When it goes right every month, that is not a statistical aberration, it is accurate. Nevertheless, unemployment has generally been falling. On the other hand, this year the public sector borrowing requirement will clearly be much higher than that forecast by the Chancellor in last year's Budget, and in his Red Book. I shall return to that point later. I say that that is the case despite this month's aberration on the borrowing requirement. It will clearly be out of line with what was forecast.
The share of income taken in public expenditure is higher than when I left it as Chief Secretary to the Treasury in 1979. I would not complain about that if I could see real improvement in public services, but I
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cannot see anything of the kind. We now know what lies ahead. We know from the Prime Minister's Guildhall speech, and from what the Chancellor said at the Conservative Party conference that:
"The share of national income taken by the public sector will be reduced".
As I say, that is what they have both said, because, they say, it would not improve the economy unless they did that.
There is no need for us to look too far. We know what it is all really about. It is about the Chancellor improving his reputation with Conservative Back Benchers. That is what he is concerned about, and I understand that. He does not want to be blamed too much when they lose the general election. He may have some other job in mind at that stage. So I understand that. But the plain fact is that, by cutting personal tax in an attempt to win that general election, first, he will not achieve it, because people have already seen through that argument, and he will not get a feel-good factor from it.
In addition to cutting taxes, I am afraid that the Chancellor will bring the public sector borrowing requirement back towards balance in the medium term, as we are told. We understand that his own advisers have told him that he should not seek to do that. I must say that I agree with his advisers. He should not have sought to do that. He has no need to. He is also, it seems, wrong about inflation. This year, despite this month's statistical aberration, inflation has been going up. I must say that the Government are doing very well on statistical aberrations at the moment.
Unless the Government change their policy somewhat fundamentally, it looks likely that next year inflation will be 3.5 per cent. rather than 2.5 per cent. He could of course reset his PSBR and his inflation targets in the Budget next week, but judging from the Queen's Speech that seems unlikely, although he has left himself some room for manoeuvre by being just a little bit ambiguous on both those fronts to allow more to be done, but he cannot have growth at the same time.
So what exactly does the Chancellor have in mind? I hope that he will in fact meet his economic growth targets and his employment targets, but he may exceed his inflation target and his PSBR targets. He and we and the country could live with that, because that is much more important when, on his own figures, unemployment will still be over 2 million.
Against such a background, the Chancellor may achieve his target of a £3 billion or £5 billion cut in public expenditure. Indeed, he could achieve even more if he cuts the contingency reserve, which last year had £3 billion in it. It would mean that there would be nothing left for his Ministers to spend by way of contingencies. So he could spend even more than that, and, as a percentage of £700 billion of GDP, it is not much more than petty cash, as my noble friend Lord Peston would tell us, although he did not tell us today.
Even if that were to be pursued, as seems all too likely, the net result would be higher personal consumption. That is what we would get. Admittedly it would be from very low levels, but it would be offset

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largely by cuts in public sector investment—capital expenditure—which is the easiest way to cut public expenditure, as I found to my cost in those five years. It is the easiest way to do it, and that is the way that I fear he will do it, but that would hardly help his inflation target or his PSBR target. As I have indicated, it will do little for unemployment. The only thing that might just stop him is if the City made it crystal clear to him, as I hope that it will, that if he went that far—I was glad to see the noble Lord, Lord Prior, not from the City but from industry, telling him not to go too far—interest rates would go up rather than down.
As it is, just when we need more investment, we are likely to have less. We have already had indications that the manufacturing sector is slowing down. There has been a foreshadowing of a slow-down in growth there. Our main export markets to Europe have been slowing down. Thus it seems likely that growth next year will be higher than this year—that is not too surprising because it has been pretty low—but it will be based largely on higher personal consumption. We may be able to get through next year, but I fear that a future Labour Government would be faced with the difficulty of hitting the usual constraints again. Certainly the Chancellor will be hoping that he is no longer there when he meets those constraints, as he most certainly would.
It is all very sad, for it seems that we still cannot sustain more than 3 per cent. growth without running into those constraints of higher inflation and higher PSBR. What I find especially sad is that the Labour Party does not have an answer either, although I welcome one or two of the proposals, such as the one-year capital allowances, which should help investment, and the proposed help for youth unemployment. Those are good proposals but are not sufficient to solve this perennial problem.
I know only too well that there is no simple answer. I want to see higher public expenditure on, for example, education, health, training, social services, and so forth, but I am only too conscious of the impossibility of paying for it without higher growth and, as my noble friend Lord Peston said, higher growth in productivity, rather than higher taxes. Certainly in the long term we must hope to achieve that, but in the short term I would finance some of that expenditure from slightly higher borrowing, which we can well afford, thus giving the economy the kick-start it really needs. I understand why my right honourable friends are not prepared to say that. I can say it but they cannot. It is what I would do but, as is obvious, I am not speaking for them.
Such a provision would be better than the current or even lower levels of public expenditure that we are likely—indeed, certain—to get in next week's Budget. I understand that the Chancellor of the Exchequer will tell us about public expenditure cuts. My suggestion is that it would be far better for a Labour Government not to accept the Government's levels of public expenditure but to increase them. The result would not mean the lower levels of economic growth, as we are told by the Government. The plain fact is that if one compares our levels of public expenditure as a percentage of GDP with other western countries between 1979 and 1995,
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we have been on average, under this Government, at about 42 per cent. of GDP. Germany, Italy, Austria, Denmark and Belgium have, on average, had higher levels of economic growth.
We are constantly told by the Government—indeed, we were told by the Minister in opening the debate—that everything is marvellous; as regards economic growth, inflation and so forth, everything is wonderful. The Government have managed that with a higher level of public expenditure as a percentage of GDP than other countries. How did they achieve that miracle? I am sure that the noble Viscount the Leader of the House will be able to tell us. He is smiling, so obviously he has an answer in his brief.
The plain fact is that the Government have managed it not through any miracle but with higher levels of public expenditure. However, I believe that the crucial question should be: what is our main objective in running the economy? What should be the main objective of a Labour Government? Certainly, it is not tax cuts. I could accept, eventually, a lower tax rate of 10 pence in the pound in order most to help lower paid families and to provide incentives. But as was said by my noble friend Lord Peston, we need growth in productivity to pay for the decent levels of public services that are required in a civilised society. That and low unemployment should be the top priority of a Labour Government. Certainly, it would be for me. But I fear that next week's Budget will be going for tax cuts, certainly not for the lowest paid. I hope that they will be condemned.
5.12 p.m.
Lord Boyd-Carpenter: My Lords, we are on the last lap of the debate on the gracious Speech. I wish to begin by reminding your Lordships that this debate was prefaced by probably the best speeches of a mover and seconder of the humble Address that it has been my experience to hear during a number of years in your Lordships' House. We were given an extremely good start by two splendid speakers, and I wish to put that on record.
Secondly, I wish to remind your Lordships that we shall be dealing, as we have been told, with questions of finance. In that regard, I was intrigued when I glanced at the Consolidated Fund Bill, which is now before us. I do not know how many of your Lordships recall the terminology used in that Bill. It states:
"We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom in Parliament assembled, towards making good the supply which we have cheerfully granted to Your Majesty in this Session of Parliament",
and so forth. That touch—that these vast sums of money are voted cheerfully by your Lordships' House—has a certain attraction. I am not sure that many of your Lordships appreciate the cheerfulness of it. For example, the admirable speech of the noble Lord, Lord Barnett, did not seem fully to appreciate the cheerful character of that provision.
We are dealing with finance at a moment of great importance and great difficulty. It is very difficult to know what the Government ought to do by way of taxation. However, I say at once that I wholly disagree

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with the noble Lord, Lord Harris of High Cross, who suggested that increases could easily be made in VAT as a means of dealing with the matter. I do not share his enthusiasm for VAT. Surely it is a directly inflationary tax; it adds something to the price of every article to which it is applied. If anything fulfils the definition of inflation, surely it is that.
As your Lordships know, VAT has been applied freely in recent months and years. I shall not weary the House by repeating the ridiculous imposition of VAT on church bells, save to point out that if one is trying to find a really silly piece of taxation that is a good example. It has caused a lot of hardship to those who run small country parishes. VAT puts up prices everywhere. It now falls on insurance and air travel. In every direction in which one looks, VAT is increasing prices and therefore having a directly inflationary effect. I hope that any changes in taxation which the Government see fit to make will include a reduction in this very damaging tax. One puts an additional charge on necessities of one kind or another and can then say that one is apparently seeking to deal with inflation. In fact, one is simply creating inflation.
As your Lordships know, the need is to cut expenditure. There are considerable directions in which expenditure can still be usefully cut. I suggest that one is our substantial contribution to Europe in order to subsidise tobacco production there. No doubt my noble friend will be able to give the House the figure but I know that we contribute a substantial annual sum to the subsidy which goes mainly to Spain and Italy in order to finance the production of tobacco. If one takes the view, as officially the Government and many noble Lords do, that the smoking of tobacco is injurious to health, it is ridiculous that we should increase our tax burden in order to subsidise its production. I know that it will be said that those countries cannot grow anything else. Well, if they cannot grow anything else, they had better stop growing altogether! To say that a damaging poison must be produced in a country because it can find no other product to produce is a ridiculous argument which need take up no further time of the House.
There is other expenditure that can be cut. I approach the question of legal aid with caution and diffidence, but the cost of legal aid has risen steadily year after year. The noble and learned Lord the Lord Chancellor gave the figure for the current year as £1,400 million, which is an enormous sum and much larger than was the amount a few years ago. Why is it necessary steadily to increase the cost of legal aid in the circumstances of today? Does that not suggest that there is a lack of control over that expenditure?
There are other areas in which there is very considerable expenditure. There is the VAT on insurance premiums. And yet one would have thought that it was good government policy to encourage people to take up policies of insurance.
And then there is the VAT on air travel, about which I feel very strongly. Some of your Lordships may recall that some years ago I was responsible for our Civil Aviation Authority. It is a source of great pleasure to
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me, and I am sure many noble Lords, that British civil aviation has spread and developed and become competitive with other airlines all over the world. But to impose VAT on the fares which people pay in order to fly in British civil aircraft seems a very mistaken policy indeed.
Therefore, deeply though I respect—as always—the views of the noble Lord, Lord Barnet, his indication of a preference for VAT is one which I rather emphatically would reject.
Another area of expenditure which we have discussed recently—it is very substantial—is that for asylum seekers. The extremely slow method used to sort them out and deciding, as has to be decided in the case of many of them, that they should return to the place from which they came, apparently produces, according to a Government statement, an annual cost by way of benefits of one sort or another of £200 million a year. Again, why is that necessary? I suggest that the Government require to take a tougher line on public expenditure generally in order to be able to not increase but to reduce taxation.
The high levels of taxation—and they are still high—which we have in this country are a handicap to our competitive effort. They make our products more expensive and less saleable. The more that we can reduce our government spending and the levels of taxation that consequently follow from that, the more competitive British industry can be. I hope that the Government will not be discouraged by some of the remarks that have been made in your Lordships' House this afternoon and on other occasions from steady efforts to reduce expenditure and therefore, consequently, to reduce taxation. If they do that, they will have served this country very well and I have little doubt that this country will be grateful to them and that we may again have the pleasure of a Conservative Government.
5.22 p.m.
The Earl of Caithness: My Lords, I follow straight on from my noble friend Lord Boyd-Carpenter because sadly, the noble Baroness, Lady Castle, has scratched her name from the list. I understand that that is because she is suffering from flu. I am sure that we all wish the noble Baroness a speedy recovery and hope to see her back in the Chamber quickly.
I listened with interest to what the noble Lord, Lord Jenkins of Hillhead, had to say about the improvement of the Government Front Bench. Without a doubt it has improved substantially in the past 18 months just as, indeed, the Labour Front Bench has improved substantially since 1981. Perhaps it is all just a question of timing and when one leaves the Front Bench.
In the gracious Speech, Her Majesty said that her Government will continue with firm financial policies based on permanently low inflation. That is to be welcomed because inflation has been such a destroyer and it is totally dishonest. Inflation leads to a dishonest monetary system and we have suffered from that over the past 30 years or so.

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I was very interested in what the noble Lord, Lord Barnett, and my noble friend Lord Prior said. My noble friend Lord Prior said that we must not go back to the boom or bust era that has plagued us for the past 30 years. The noble Lord, Lord Barnett, said how difficult it is to square the circle between achieving steady growth over 3 per cent. and then not having high inflation. I felt that they should have both gone on to analyse why we have that situation. When I had the honour to be Paymaster General in the Treasury, I was always concerned as regards the extremely good efforts which governments of both persuasions have made to control the economy. Neither wanted to see high inflation. When the noble Lord, Lord Barnett, was Chief Secretary, he did not want the problems which he encountered. And we did not want the problems which we encountered in the 1980s when everything seemed set fair. Yet we have had three massive collapses in asset values. We had the property collapse in 1974, which I remember well; we had the problem with shares in 1987; and we had the collapse of the property market again in 1989.
In spite of the very best endeavours of whichever government were in power, it was not possible to prevent those events occurring. We have now another good, healthy economic situation just as we had in the mic1-1980s. I just do not want this Government to lose the opportunity to take us forward again on a steady path.
Therefore, I have looked at the problem carefully and I have found somebody who I believe has actually put his finger on why we have these problems. We have them because the whole system under which we operate is totally wrong. We operate on a debt-based system. That did not come about through choice. We did not vote on it. It was an incremental result of the closing of the gold window in 1971 by President Nixon. Since then, the whole debt-based system has led to the sort of disasters we faced in the 1970s and 1980s and are likely to face again unless we move away from that system.
As the noble Lord, Lord Barnett, said, at present the economy is slowing. The backlog of orders for businesses is beginning to reduce and that is a slightly worrying sign. People are insecure in their jobs and in their homes. They are frightened of what the future may hold. That is not an easy situation for any government to handle.
What is the solution that most economists put forward? They say that we should lower interest rates. I was at one time a firm believer in the interest rate mechanism as the lever to control the economy. I must say to my noble friend on the Front Bench, Lord Cranborne, that I no longer believe that. It plays a part but it is by no means the only lever. It has brought such misery and distress. In effect, what has it done? The lowering of interest rates has encouraged people to borrow more and it has encouraged those who are not in debt to borrow for the first time. When interest rates are raised, everybody is penalised. When they come down, the urge to borrow is increased. That increases the debt which each of us as individuals and the country have to bear. That, in turn, slows down the whole economy of the country and is extremely detrimental.
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Therefore, I disagree with those economists who say that we should lower interest rates. I say to the Government, "Please do not lower interest rates and do not fiddle with the housing market." I am back in property and the housing market again, as I was before I went into government. I hope that the Government will not interfere with that. There are various problems in the housing sector—negative equity and so on—but the Government should not interfere with it because it will sort itself out, although it will take time.
When one considers the role of government one sees what a small player the Government are now in the whole financial market. It is worth looking back at figures from the Bank of England. In 1971, when President Nixon closed the gold window, the money stock in the United Kingdom stood at £31 billion of which £3.5 billion was government minted notes and coins and the balance of £27.5 billion was in deposits. That had existed for many years. We had run the largest empire in the world with less than that; we had been a reserve currency for most countries in the world with figures that were less than that; and we had been a very successful nation with figures less than that.
What has happened since the closing of the gold window? In the intervening 24 years to September 1995 the government minted an additional £19 billion, bringing the total notes and coins to £22.5 billion. A simple piece of mathematics will show that the total money stock—the M4—should now be in the order of £50 billion. It is not. In September 1995, M4 stood at £608 billion. Of that £608 billion, £585.5 billion was in deposits. The banking sector and finance sector had created £558 billion in deposits in 24 years. No government authority or government approval was involved; indeed, there was nothing that the Government could do about it. That has increased the handicap that a government of any persuasion will have to face under this debt-based monetary system.
I believe that one of the problems is the level of reserve requirement. It used to be 20 per cent., but it is now rather less than 1 per cent. As a result, the level of domestic debt has increased by more than 20 times in 24 years. We now have a total of deposits and capital on loan of over £700 billion. How long can we tolerate that situation? How long can any economy sustain that level of debt? How long can any government operate the right type of policies, which this Government wish to operate, with that sort of handicap?
I strongly believe that we should have low inflation. I should also like to see steady growth. I do not like the boom and busts. But my fear is that unless this Government, or the next government of whatever persuasion, take an urgent and radical look at the system the banking and finance sectors operate in this country, they will be operating with two hands tied behind their backs. I do not blame the banks. That is the system under which they operate. The more successful they are—and British banks are very successful—the more they run this country into a debt that we are handing on to our children. That is not something they will thank us for.
5.33 p.m.
Lord McCarthy: My Lords, I hope that the House will forgive me if I do not follow the previous speaker as regards the content of his speech. I was interested to hear that it is all the fault of Richard Nixon because he closed the window. I am most receptive to that kind of argument, but instead I want to do something which I hope is in order. I do not want to discuss so much the gracious Speech because what I wish to discuss is not mentioned in it. However, I take it that we can raise with the Government matters that are not mentioned because, after all, at the end of the gracious Speech it states:
"Other measures, including other measures of law reform, will be laid before you".
The other measure that I should like the Government to tell us that they propose to do something about concerns unemployment and, in particular, long-term unemployment. If one reads the gracious Speech, one will find that there is nothing about that in it; indeed, the word "unemployment" is not mentioned.
The noble and learned Lord, Lord Fraser of Carmyllie, said a great deal in his opening remarks about forms of competitiveness and about competition. However, the only mention that he made of unemployment was to refer to a fact that the figure had gone down by some 700,000 since it peaked in 1993. That comes out at about 28,000 a month and means that, in another year, the figure will be down to 2 million and, if it continued for a further three years, it would be down to 1 million. So it is not very useful to tell us that it has gone down by that amount since the peak in 1993.
Yesterday the Minister of State for Education and Employment in this House spoke in the debate. He is also responsible for education. Although his speech ranged widely and included agriculture and rural areas, he did not mention employment and certainly not long-term employment. Indeed, in my estimate, the last time that the Government in this House—and I cannot speak about the other place—discussed the question of unemployment, especially long-term unemployment, was in answer to a Question tabled on 24th October by my noble friend Lord Dormand. My noble friend asked the Minister about long-term unemployment and what he was doing about it. The Minister replied (at col. 962 of Hansard) that it was a matter of great importance and that it was a "key priority". But, again, no concrete proposal or additional measures which would, perhaps, increase the rate of decline in unemployment were advanced.
It is about that that I want to ask the Government. In the next parliamentary Session what do they propose to do about unemployment and, in particular, long-term unemployment? We know that the Minister said on 24th October that the Government were providing 1.5 million job opportunities. I do not know whether that it is the total number of placings made in the Jobcentres. I do not know whether that is adding up all the interviews and making them 1.5 million attempts to get people back into work. I am not talking about that; I am talking about positive measures.
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Let us take, for example, the one positive measure in which the Government are involved; namely, the training and enterprise programme. A recent edition of what used to be the Ministry of Labour's Gazette but what is now called Labour Trends tells us that 350,000 places have been allocated this year in the programme. That compares very badly with the activities of the training and enterprise programme at the last point in the previous cycle—round about 10 years ago, in 1984—when the programme was producing 661,000 places. It is not just that the number of places is in decline; it is the content of that decline. I say that because the Government have more or less maintained the number of places on the youth programme. That programme has only been cut by about 20 per cent., but if one looks at adult provision as regards the years 1984 and 1994, it will be seen that there has been a 75 per cent. reduction in adult provision on the training and enterprise programme. In other words, the latter programme is now a youth programme. Nothing really is done in the training and enterprise programme for adults who are out of work. My question is: why not?
Are the Government saying that adult unemployment is to be solved by the upswing of the cycle, if and when it arises? Is the argument that we can leave adult unemployment—and, in particular, long-term unemployment—to improvement in the general competitiveness of the economy and the general level of demand for labour? If the Government believe that, they really have gone back on every argument of previous governments in the early 1980s, with its later recession, and certainly of the Labour governments of the 1970s. No serious economist really believes that the problem of long-term unemployment can be solved by the upswing of the cycle. We are talking about people who find it increasingly difficult to obtain any kind of employment. Only carefully designed, special measures have any chance whatever of taking such workers out of the unemployment trap.
The Government should think seriously about the matter. Indeed, when the Chancellor of the Exchequer thinks about it seriously he says and does things which indicate that he is beginning to understand that one cannot expect significantly to improve the problem of long-term unemployment by waiting for the upswing of the cycle. In the 1983 and 1984 Budgets the Chancellor floated a small number of measures which were designed to improve the level of positive job creation.
My next question to the Government is as follows. In 1984, in his Budget speech, the Chancellor made five tiny suggestions. I want to know what has happened to those suggestions and how far they have improved the position of the long-term unemployed. For example, he reprieved the community action programme. How many people among the long-term unemployed did that put back into work? He introduced a small extension of the three week work trial programme. He made further minute cuts in National Insurance payments for employers, as he said that that would help to put people back into work.
He announced two measures in which I am particularly interested and I would like the Government to comment on them. We cannot know the consequences

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of one of those measures and we ought to know the consequences of the other. He promised us full employers National Insurance rebate—a system of fully discounting the National Insurance rebate—for an employer who employed those on the register who had been unemployed for two years and over—the long-term unemployed. The problem is that this programme is due to start in April 1996. Could we not advance that programme a little? Is that programme still being thought about, modelled and monitored? Where is that programme which was announced in the previous Budget? Finally, he put another 5,000 workers into the work START programme.
I am sure that every Member of the House here today knows the Work START programme backwards but, in case there are one or two who do not, let me say that the Work START programme promised £60 a week for six months to any employer who took on a member of the long-term unemployed who had been out of a job for two years. We have had a pilot of the START programme for two years. I am not asking the Government, and certainly not the Minister here tonight, to prejudge any announcement which the Chancellor might make tomorrow about the future of the START programme, but he could tell us something about how it is getting on. He could tell us whether the Government consider that it has been a worthwhile exercise. As I have said, there has been a pilot scheme for two years.
Many people believe that the START programme, which the Government had stumbled on and then fumbled with all this time, could represent a major improvement in the employment conditions of the long-term unemployed. It has the attraction—if one is looking for it—of being a nil cost solution because £60 a week given to the employer to take someone off the unemployment register is slightly less than it costs to keep that person on the register and on benefit for a year. The average cost of the average person on the benefit register, whether that is unemployment benefit or supplementary social benefit, is £3,200 a year. Therefore, one makes a little. It offers the possible prospect of a nil cost solution. Instead of giving the money to the worker, one gives it to the employer and the person comes off the register.
Some people, and indeed some professors who should know better—including Professor Snower, for example, of Queen Mary College—think the Government could put 1.5 million people into work with this wonderful programme. I do not suggest that. I think that that is just a piece of econometric trash. Nevertheless, he said that it would represent a 20 per cent. reduction in marginal labour costs; that it would put 1.5 million people into work; and that we would reach an unemployment rate of somewhere between 3 per cent. and 4 per cent. That would be a miracle but the scheme is worth trying and anyway the Government have been fiddling about with it for two years.
The main defect of such a programme—I wish to say a few words about this before I finish—is our old problem of dead weight. If one hands out the money that one gave to the worker on the dole to the employer, after a while the employer would develop a system which he calls "churning". That is a fancy name which
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means that he gets the money for taking on the people he would have taken on anyway. That has been the record of similar programmes in the past.
I have two points to make about that. First, we never sought to monitor these programmes effectively previously and when the programmes operated in the public sector they had much less dead weight than they had in the private sector. I leave that with the Government. Secondly, if we are really trying to get people into work who have been out of work for two years, we should not be terrified by a certain amount of dead weight. If the employer is being forced by the subsidy—and if the subsidy is nil cost or very close to nil cost—to select workers he would not normally select (employers would not normally select people who have been on the unemployment register for two years for all kinds of reasons) and yet we reduce long-term unemployment significantly faster than we reduce total unemployment, that would not be a bad thing. Be that as it may, I have asked a series of questions. I hope that the Government will be able to answer some of them, and I hope that despite the fact that there is nothing in the gracious Speech about unemployment, the Government have some policies.
5.46 p.m.
Viscount Astor: My Lords, I believe that industry in this country is now in a better position to take advantage of the opportunities for growth that now exist than most of our competitors in Europe. This is of course due to the sound economic and fiscal policies that this Government have maintained during their time in office. We now have economic growth with low inflation and an ability to compete not only in Europe but in the important markets opening up in eastern Europe and in the rest of the world. Therefore I welcome the proposals in the gracious Speech to improve competitiveness, remove burdens on business and in particular to improve the progress of deregulation. I am afraid that "progress" is perhaps an optimistic description because it has been painfully slow progress. However, before looking at the reasons for that, I give a warm welcome to the forthcoming Broadcasting Bill.
The broadcasting industry needs this Bill. It is one of our most important industries, contributing no less than £3.5 billion to our economy. It accounts for no less than £1 billion of our exports, and we have an export surplus of £200 million. The world broadcasting market is expected to grow by 70 per cent. over the next 10 years. Our broadcasting industry is profitable and produces quality programmes that are admired worldwide. However, the industry needs to grow to compete with the vast empires that have been created in Europe and in America. For too long we have tried to separate artificially different sections of the media. New technology and changes in consumer behaviour have made our old rules and regulations redundant. What is more worrying is that these rules have provided a barrier to growth and new investment. In particular they have blocked British companies and have allowed those with new technology, who are often based outside this country, an almost free run, unfettered by regulation, to create new, near monopolies.

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As the law stands, if one owns newspapers one cannot own television. If one owns television, one cannot own satellite. If one owns local radio, one cannot have a share of local newspapers. We must treat the media industry, whether it be newspapers, television, cable, satellite, radio, or any combination of any or all of those, in the same way as any other industry. The barriers between parts of the industry do not make sense. Newspapers are now providing news on demand on one's personal computer, telephone companies are looking at ways of providing video on demand on one's television. What should we call these services? Are they television, telephony, or computing? I believe we must have proper competition law that covers the industry as a whole, and that includes encryption services which are the access point for those wanting to use cable or satellite services.
That competition law must also include the BBC, which now has a large commercial business in addition to its public sector broadcasting role. With regard to the BBC, I hope that the Government will privatise the BBC's transmission business and that in order to raise the maximum revenue possible they will allow an open bidding contest. There could be substantial savings in transmission costs for both the ITV companies and the BBC. The sale of its transmission business will give the BBC the funds needed to invest in digital terrestrial transmission.
The past year has been an interesting time in the broadcasting world. Satellite now has a firm foothold, and cable is operating in many cities. BT wants to change the rules halfway and join in the game, encouraged by the party opposite. So does Michael Grade at Channel 4, and many of your Lordships will remember being lobbied vigorously on the subject of the Channel 4 funding formula.
I urge the Government to think very carefully and seriously before amending in isolation any one part of the financial arrangements set out in the Broadcasting Act 1990. Channel 4 may well pay some £ 60 million to the ITV companies this year, but the ITV companies themselves will pay £ 370 million to the Treasury.
Perhaps I may explain briefly why I believe that this is such an important issue. The financial and formula arrangements in the 1990 Act, however imperfect they may be, were carefully weaved together. Many hours of debate took place in your Lordships' House. As a result of the Act financial projections were made. The investment required was then raised and, finally, bids put forward based on the Act.
Although the new Bill, which has yet to be published, deals primarily with the ownership and licensing of digital services, pressure will again be exerted on your Lordships' House and the Government to change the current arrangements. It must be resisted because, if we are to encourage investment in new digital technology, which will involve hundreds of millions of pounds, there must be confidence that a viable return for investors is possible. If Parliament changes the rules on which bids for franchises were based it would be the equivalent of changing the prospectus after flotation. That is not
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allowed in the City, nor should it happen elsewhere. It would unfairly diminish the value of current shareholdings. What can discourage future investment more than that?
Independent television is a great success story in this country. We share the English language with the Americans; it is time that we started to share some of their prodigious export successes. I believe that the Government reforms will give broadcasters every opportunity to do just that.
Any industry, if it is to grow, must adapt to the changing world. We must allow mergers that are in the public interest. They allow cost cutting which provides the revenue for new investment.
I return to the subject of deregulation. As I said earlier, progress has been painfully slow. I am afraid that some of the regulations that have been made redundant are so minor as to be almost irrelevant. We have not managed yet to cut the red tape. Therefore, I am delighted that the Deputy Prime Minister is to lead the initiative to speed up the process. He has been in the DTI, so he should know where to find some of the prime candidates. Government departments cling to their regulations like drowning men cling to a liferaft.
We often hear the excuse that regulations were forced on us by Brussels. In many cases that is simply not true. The bizarre rules seem to be entirely home grown. To be fair, sometimes they are made in response to some vague EC directive from Brussels that no other country seems to have bothered with, let alone read. However, most of the regulations are invented in Whitehall, and often pursued with great vigour by government departments, local government and quangos. Small businesses feel under threat. They feel that they are attacked with a vengeance not seen since the Inquisition.
Even seemingly simple regulations are often interpreted and enforced in unreasonable ways. If, for example, local traders go to their local magistrates' court and are able to win their case their problems have just begun. Local councils instantly go to appeal, and therefore threaten the trader with the possibility of huge costs being imposed if the judgment goes the other way at the next stage. What business can afford to take that kind of risk? Even the largest balk at the cost.
I hope that the Government will also look closely at quangos. I believe that there are too many and that there is room for rationalisation. Conservative principles are about devolving power to the individual; too often we have merely devolved power to the quango.
I dislike the culture of "quangockery" that has invaded and taken over our lives. Some have no right of appeal against their decisions. Some constantly reinvent their reasons for existence. They often pass increased costs via higher charges to the consumer. These are expensive organisations. The Government must ensure that the taxpayer gets value for money.
I hope that deregulation will be put into top gear. It is not about removing protection from the public; it is about removing barriers that prevent industry from being successful. I know that Ministers take the problem seriously and I look forward to speedier progress.

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The Labour Party, if it is ever elected, plans to introduce the Social Chapter, so successfully excluded from the Maastricht Treaty by my right honourable friend the Prime Minister. They also plan to introduce a minimum wage, although they do not know how much it will be. The noble Lord, Lord Peston, did not manage to cast even the tiniest amount of light on that issue. Both those actions would destroy the advantages that this country has obtained, advantages which the Labour Party would instantly throw away. Businessmen I have met in Europe recently wish that their own governments had not signed the social chapter. They find that it is making competition with the growing manufacturing countries, particularly in the Far East, impossible.
I also found no great enthusiasm for a single currency. We do not necessarily need it. Different countries have different economic needs and conditions vary, as do public spending, taxes and interest rate policies. It is a bogus argument to say that we cannot remain at the heart of Europe without automatically agreeing to a single currency. If the time ever becomes right it will be obvious, but that is certainly not in the near future.
It has become fashionable in your Lordships' House to declare one's interests, so I shall declare two. The first is that since July I have again become involved in commerce—the alternative to becoming one of the students of the noble Lord, Lord Peston. At least it is better than that. The second interest I have to declare is that I intend to do all that I can to ensure that the party opposite never has a chance to govern. I have been on the Opposition Bench. I know what it is like, and I do not intend to return. After all, noble Lords opposite have got used to their places, and who am I to disrupt them'? Let them remain in their familiar surroundings for a long time to come, in their favourite places.
5.57 p.m.
Lord Donoughue: My Lords, as always, I am happy to follow the noble Viscount, Lord Astor. Indeed, with my colleagues I shall follow him on to the Government Benches opposite before too long.
Like the noble Viscount, I shall also speak mainly on broadcasting, although the whole national heritage sector, with which I am concerned, has considerable economic as well as cultural significance which is often underestimated. That sector employs 3 million people in the arts, sport, media and tourism, and the latter two sectors are forecast to be among the highest European growth sectors. Therefore, that sector matters.
I shall not deal today with the arts and sport, which were not mentioned in the gracious Speech, except to say that we shall be watching closely to see when the very specific promises made by the Prime Minister and Ministers in both Houses on the question of lottery distribution and additionality in public expenditure are broken. I warn that if and when direct grants to the arts and sport are cut and replaced by lottery distributions there will be very strong grounds for bitter complaint.
My main focus today is on broadcasting, which, as the noble Viscount, Lord Astor, rightly pointed out, is one of the most dynamically growing sectors in the British economy. In the next few weeks we expect in
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this House both the BBC's new Charter and Agreement and the new broadcasting Bill, which we sincerely hope will be better conceived than the disastrous 1990 Act.
We shall scrutinise the BBC Charter and Agreement closely, seeking to ensure that they offer to Britain's and indeed the world's greatest public service broadcasting asset the financial and editorial freedoms necessary for it to survive and expand in the future competitive world of global multi-media. We also hope that that is balanced. We hope that the Charter and Agreement have an explicit list of the conditions and objectives which the BBC must meet to retain the support of licence fee payers—for example, on impartiality, accuracy, taste and decency, a continuing commitment to educational broadcasting and patronage of the arts, and continuing full coverage of parliamentary proceedings.
We also wonder whether there are ways to make the governors of the BBC—I see they are in the news again—more fully and separately accountable, possibly to Parliament itself. We need, and they need, to ask to whom they are responsible and for what.
There are strong rumours of the privatisation of the BBC transmitters although it was not specifically mentioned in the gracious Speech. We on this side would look very critically at that, seeking to ensure that the BBC is not put to any disadvantage by the sale of its transmitters and especially that it should not be squeezed on monopoly prices. However, I accept that there is a problem in the current situation regarding how the BBC funds digital terrestrial television transmission investment and how it could, under present rules, compete for third party business.
The Broadcasting Bill is of enormous potential significance—more so from the national point of view than any other piece of legislation in the Queen's Speech. It will effectively draw the landscape for British broadcasting in the rocketing multi-media and interactive world of the 21st century. It will contain provisions for cross-media ownership. The Government have floated their views already. We broadly welcome them. We reserve our position on the detailed points system, and so forth, but the proposal appears, commendably, to offer support to our basic objectives; diversity of view, plurality of ownership, and avoiding excessive dominance by one owner.
We are concerned at the potential erosion of the regional dimension and the enormous powers for the proposed new regulator. We are especially concerned that increased cross-media ownership will result in less choice of information and ideas. It would be a pity if the bias and sensationalism of much of our printed press further infected television. We accept the need for greater freedom to be allowed to newspapers and broadcasters in an area where the separate sectors are converging because of technology. However, we wonder whether it would be better to allow newspapers and broadcasters owning other media sectors to be limited in their expansion to new media outlets, so expanding choice.
The question of digital terrestrial television is more complex, more speculative and more technical, so I understand that many eyes glaze over. However, it is of

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enormous importance. Digitalisation is the technological future of broadcasting. It offers more channels and better picture definition. Our terrestrial broadcasters—the BBC, ITV, Channels 4 and 5—will remain significant providers to the public for many years to come. We wish to support that continuance. But technically they must become digital to compete with the remarkable strides that are being made in satellite and cable broadcasting. Having said that it must occur, it is not clear when the switch will take place, who will invest in that speculative future, and how. At present there are no digital TV sets or black boxes. There are no broadcasts. There is no audience. Future profitability is therefore uncertain because the multiplying channels with digital technology will inevitably fracture audiences and slice advertising revenues into a greater number of segments. One consequence is that pay television will be more suited to digital technology than is advertising.
The Government are right to have grasped the nettle now; I commend them on that. We on this side have not until now had an opportunity to respond because the consultative document was rushed out in the Recess. However, I shall offer a few brief reactions now.
First, we support a future cut-off date for switching from analogue to digital because that is the only way that one can guarantee to an investor the prospect at some point of a major audience for digital television. We do not accept the need to divide the proposed digital multiplexes between operators and broadcasters who sub-lease from the operators. That is too complex. It would also prevent the BBC from owning a multiplex. We see no reason why it should not. We see no reason why ITV, perhaps in conjunction with Channel 4, should not own one or two. The licences should be to both operators and broadcasters.
I believe, too, that the existing terrestrial broadcasters who are being reserved guaranteed space on the multiplexes should have full multiplexes and not parts of them as proposed in the government paper. They need sufficient band width to accommodate all developments in the practical future—for instance, high definition television. Under the Government's proposals for only 6 megabits, one of the reserved people, the BBC, could not have high definition television which requires 9 megabits of band width. I believe that those broadcasters should be given sufficient band width. They should be given the full multiplex. It is right that they should have that because a multiplex requires common editorial management. There will be continuing questions of choice among many broadcasters within that multiplex regarding who gets how much space. That decision should be taken by a single overall provider. That is enough technical jargon for my lifetime.
Noble Lords: More!
Lord Donoughue: I do not know any more! It is important that there must be common technical standards and common interface equipment. That will
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make possible the economies of scale that are necessary for lower prices and make it possible for our industries to export abroad with common standards.
There must also be fair and full access for broadcasters so that they face no access barriers of the kind which exist at present in some parts of cable television. There must be fair access for viewers to all broadcasting services via a single set-top box. Receiving equipment must carry terrestrial as well as satellite broadcasts. Otherwise, if one has receiving equipment which may be controlled by someone from satellite which—surprise, surprise—cannot receive terrestrial digital television, then the terrestrial broadcasters will be at a disadvantage. We must ensure that that does not happen, so that aspect requires tight regulation. In my view, it would be better done by ITC rather than Oftel, as proposed in the paper, simply because ITC has a more immediate concern for the broadcasting principles at stake.
We are attracted—anyway I am—by the ITC's proposed draft code for conditional access systems. We need strong regulation to ensure fair competition among the multiplex operators, especially among the conditional access systems, the so-called "gateways", and also among the navigation systems, those processes that describe where one can go on the system. Of course, that provides many opportunities to give preference to those who come first and there must be free access there. That is why we sympathise with the ITC's draft code.
We are always concerned on this side that there is insufficient quality criterion in the Government's proposals in the broadcasting sector. In the proposals to allocate the digital multiplexes, there is no criterion for quality whatever—just a requirement for speed of investment and variety of service. We feel that quality should always be there as a criterion. The situation is even worse than under the 1990 Act which had that marginal quality threshold. I believe that the ITC should be allowed, in allocating the multiplexes, to make quality assessments, as it recently did—very courageously, in my view—on the Channel 5 allocation.
On a separate but critical aspect I must mention the question of the televising of great national sporting events. We thought that the 1990 Act had solved that, but it did not. It could be possible for all great sporting events to be on satellite soon. We do not wish that, so we will look at ways of securing the basic principle of national access.
Overall, in the new Bill we need a delicate balance between freedom and regulation. Broadcasting is a major and dynamically growing sector, therefore it needs encouragement for rapid investment. We need entrepreneurs to invest in sufficient digital multiplexes to launch a full range of broadcast services. The licensing arrangements must not be so onerous and so pernickety as to deter them. That sometimes needs a loose rein. We should also remember that, as in 1990, one cannot legislate in rigid detail for such a fast moving and fast changing industry.
However—and here I dissent from the noble Viscount, Lord Astor—broadcasting is not just a normal commercial operation. It contains a large public service

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element; it has a powerful capacity to inform, to influence and to educate. It can use that power, as our press often demonstrates, for bad as well as for good. Therefore, we must have public regulation in the democratic public interest. We must have sufficient regulation and accountability to ensure that our broadcasting contains quality, accuracy and diversity of ownership and of editorial. It must operate under conditions of common access and fair competition.
6.13 p.m.
Lord Cooke of Islandreagh: My Lords, this afternoon we have the opportunity to discuss industry and the economy in this debate on the Queen's Speech. I shall not attempt to compete with the technical jargon—his own description—of the noble Lord, Lord Donoughue. I wish to concentrate quite simply on manufacturing industry because I believe that we now have a window of opportunity of which we should take advantage in the, perhaps, short time that it will be open.
There can be few things more important to the nation than a large and vibrant manufacturing industry. It is essential to support the myriad of service activities which are today connected with manufacturing and which provide so much employment. Manufacture and trade are now international, they are mobile and will move to wherever they judge is the best place. The United Kingdom, I believe, has some advantage when firms come to place themselves and recent announcements indicate that. It is something we must develop, while we have an advantage, because other countries will make an effort and will catch up if we do not move further.
I believe that it has now been realised that trade in an enclosed European Union is not the answer to all our needs. In fact, we would be greatly handicapped if the Prime Minister had not had the foresight to opt out of the social chapter when Maastricht was being negotiated. It would be difficult to over-emphasise the importance of remaining out of the social chapter. Most European countries are now at a great disadvantage and I single out Germany, where a half-trained person costs £ 20 an hour compared with £ 6 or £ 7 in the United Kingdom. There are multinationals now manufacturing in Germany which are trying to get out because of the very high labour costs. We have had one or two of those companies coming to Northern Ireland looking for a better place to which to move.
I think it should be understood, though, that few employers regard the opt-out of the social chapter with minimum wage requirements as merely an excuse to pay low wages. Most employers do pay good money to well trained, productive people. To have to pay a large minimum wage to someone young and inexperienced is ridiculous; it simply means that fewer people will be employed.
We now have multinational manufacturing companies looking to see how they should position themselves. What should we be doing to make the most of this opportunity? Government have a great part to play and the Minister introducing the debate this afternoon
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mentioned a good many proposals, but more can be done. Government, of course, have a part to play, but beyond that almost everyone can contribute.
Perhaps of first importance is to strive for a culture change where people generally understand and look up to manufacturing industry. There is work to be done in education. Again, a culture change is needed because all too often students are mistakenly advised to aspire to the arts or teaching and feel that it is very much a second best when they have to look elsewhere. Engineers can make a wider contribution to manufacturing companies, as they do on the continent, particularly in Germany. I am glad to note that Mr. Eggar, Minister of State for Industry and Energy, has drawn together six action groups under the banner of Action for Engineers. All this is good, but I urge that government and industry work together to make faster progress.
I wish to turn to Northern Ireland, which is my particular interest, and I must declare an interest, as I have an involvement in manufacturing industry in Northern Ireland. In the past few years we have done quite well with the development of manufacturing industry. The Department of Economic Development is to be commended for its work and that of its agencies. The Industrial Development Board and the local employment development unit have made good efforts and have successfully attracted new companies to Northern Ireland. They have come, despite all our troubles, and are doing well. Generally, they find our labour force keen and adaptable and it is encouraging that some have deepened their roots and supported the manufacture of sub-components in Northern Ireland. But in Northern Ireland we really are on the rim of Europe with another sea to be crossed, both inwards and outwards. We are at a disadvantage, so to put ourselves on the level we must do better, better than you do here on the mainland and that is our challenge.
I am grateful to the Minister introducing the debate for the figures which he gave for the improvement in manufacturing in Northern Ireland. It saved me repeating them here. But perhaps there are other figures. Our unemployment is down to 11½ per cent. Relatively, that is good; but it is entirely unsatisfactory. For the European Union as a whole, unemployment in Northern Ireland ranks 158th out of 174 European regions. That is very bad news. Our long-term unemployed account for 57 per cent. of the total unemployed in Northern Ireland versus the UK average of 38 per cent. Overall, we still have an undue dependence on the public sector for employment.
I am pleased to be able to inform the House that a private sector initiative was founded by CBI Northern Ireland two years ago. It is called the Northern Ireland Growth Challenge. Under the chairmanship of the president of Short's, it has developed to comprise a 24-person steering committee and 10 active study teams. Involved are over 100 businesses, institutions, local councils, community groups and government organisations. This challenge recognises that the drive and momentum for change must come from within Northern Ireland. Radical change requires radical action. There is a determination to improve our management

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skills, marketing skills, and so on. Major targets include 5 per cent. GDP growth per annum by 1998, the creation of 60,000 new net jobs by the year 2000, and so on.
In order to make it possible to achieve these targets, it will be necessary to have the wholehearted co-operation of government on a long-term basis and from the community as a whole. I earnestly hope that that can be achieved.
It might be thought that our political and other problems might counterbalance this initiative. They need not do so. The noble Viscount, Lord Brookeborough, put into perspective our headline problems of the moment in his contribution in the debate on the gracious Speech on Monday.
It is necessary for government to put the Northern Ireland economy first, year in and year out without deviation, and commit government to work in parallel with the Northern Ireland Growth Challenge or whatever may develop from it. The noble Baroness, Lady Denton, who has responsibility for Northern Ireland's economy, has done her best in that direction. There is no need to persuade her. But the task must embrace all government agencies. It is vital that this objective be the overall government commitment for the next five to 10 years. Political problems must not be allowed to divert attention from the economy.
It is not enough merely to seek new industries. We must develop our indigenous industries and endeavour to build up clusters of sub-contracting firms which can support major manufacturers and make it obvious that they should come to Northern Ireland. The Northern Ireland Growth Challenge is right on track with its objectives and it has set high targets. I hope that government in Northern Ireland will encourage its work and give it every support.
Unfortunately, we have some disadvantages, and these must be tackled and removed. Probably the most important is the increasing cost of electrical power in Northern Ireland compared with that in Great Britain. I have spoken about this matter before, but it needs repeating until the problem is faced up to. It has been calculated that this year, on average, electricity to industry in Northern Ireland is costing 13 per cent. more than in Great Britain. In the case of my own company, we pay 29 per cent. more per unit in County Antrim than we do for our plant in Newcastle-upon-Tyne. There are several much larger companies paying 30 per cent. or more to their disadvantage in Northern Ireland.
Power costs are coming down in Great Britain. In Northern Ireland they will go up at a higher rate than inflation if the present electricity structure remains in place. If present trends continue on both sides of the water, the cost of electricity in Northern Ireland in the year 2000 will be 60 per cent. or more higher than in Great Britain. The regulator will be reviewing Northern Ireland electricity costs in the light of their improving efficiency and this may reduce the disadvantage to around 40 per cent. or 45 per cent. But that prospect is quite unacceptable. For one thing it will make it even more difficult to attract industry from abroad.
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The director-general of OFFER has suggested that competition could be introduced in Northern Ireland with a pool pricing system. It is suggested that such a pricing system would be good because it would introduce competition. But in reality there is very little scope for competition owing to the contracts that are in place. It is questionable whether such a system could work in a small regional unit. It would be very costly to introduce and administer. Those of us involved are now coming to believe that the introduction of a pool pricing system, although nominally competitive, could not bring reductions and might even increase costs. A new director-general of OFFER has just been appointed. It is very much to be hoped that when he has had a chance to look into the position he, too, will reject pool pricing as a sensible way forward. In addition to the prospect of vastly increasing charges, the present uncertainty about future tariff structure makes it difficult for industry to plan ahead. Without a tariff structure it is not possible to calculate possible advantages in load management or load shedding, or the development of combined heat and power. A decision about tariff structure is urgently needed.
The noble Baroness, Lady Denton, announced that the Government will make £ 60 million available to help Northern Ireland Electricity customers as an offset to the nuclear levy in Great Britain which is shortly to be abolished. This subvention is most welcome. Unfortunately, however, this apparently large sum is but a fraction of the real penalty that we shall suffer in Northern Ireland. We cannot blame Northern Ireland Electricity, although it sends out the bills. It has done much to reduce its costs in the past couple of years and is subject to the regulator, who will review its performance shortly. We can expect its efficiency and costs to become similar to those of regional electricity companies in Great Britain.
The real cost drivers, which lie with the independent generators, must be tackled. In Northern Ireland the consumer will pay directly for the cost of converting the Ballylumford power station to gas. Incidentally, that cost will be very high because of the fixed contracts that are in place and the cost of desulphurisation equipment in Kilroot power station. In Great Britain, all such costs are taken account of by the generators in calculating their best price. However, the really large cost driver is the price that the power procurement business, a company within Northern Ireland Electricity, has to pay for power ex generators. That is 20 per cent. or 30 per cent. higher than in Great Britain and is rising.
The reason is that long-term contracts, until the year 2010 and beyond, were negotiated with the companies purchasing the generating stations. These contracts were negotiated by officials who apparently had little or no experience of negotiating or understanding the consequences of long-term contracts. The consequences certainly cannot have been worked through. As a result, the generators can hardly find banks big enough to hold their profits. I am a member of an industrial users' action group which is perhaps only now realising what lies ahead in terms of electrical power costs. It is time

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for the Government to face up to these problems and the penalty which they will impose on industry as well as domestic consumers in Northern Ireland.
The Northern Ireland Affairs Committee today published a report on Northern Ireland Electricity. I have not had an opportunity to study it thoroughly but I am pleased to note several relevant recommendations which are not at variance with what I have said. However, they do not appear to have emphasised sufficiently the root cause of our problems which are the long-term contracts with the independent generators over which the Regulator has no control. This disaster is not characteristic of the Government and Ministers must find it embarrassing. Can the noble Viscount, Lord Cranbome, the Minister who will reply, say how soon a statement can be expected, with information on how this very serious handicap to industry and consumers generally in Northern Ireland can be removed?
6.31 p.m.
Lord Wade of Chorlton: My Lords, it was my intention to use the opportunity of the Queen's Speech to tell noble Lords a little about some of the activities in north-west England. First, I should like to declare an interest in that I live there. I suppose that if the economy in that part of the world improves, a little of the benefit might brush off on to me. My grandfather always gave me very sound advice. He said, "If you want to make some money, it would be sensible to go where there is some." The more that there is in the North West, the better we all might be.
I have other interests to declare. I am chairman of NIMTECH, a non-profitmaking organisation charged with the responsibility of improving the GDP of the North West through the use of innovative technology. I am also a director of Inward, which is an organisation responsible for encouraging inward investment into north-west England; and I am a director of one or two other companies.
One of the major activities that has taken place recently is that Merseyside has been designated an Objective 1 area for EU funding. Parts of Greater Manchester, Cheshire and South Lancashire have been delegated as Objective 2 regions. The impact is that into Merseyside there will be put some £ 670 million of EU funds. That will represent 40 per cent. of the total investment and will be matched by 60 per cent. local investment. It will make nearly £ 1.3 billion. That investment will take place over a six-year period. Greater Manchester, South Lancashire and north-west Cheshire will receive a total of £ 272 million of EU funding, which will represent 50 per cent. of investment. Other investment will come locally.
One can imagine that the decision to make those funds available to those two regions has caused quite a lot of argument and discussion on how it should be divided and to where the money should go. Certainly those of us who have had any influence—the Government have been extremely positive about this view—feel that that money should, as much as possible, become investment in industry itself and not be spent
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on necessary local government projects. It should be invested by companies. That means that the organisations themselves have to find the other resources. In itself that has made many people look very closely at their investment criteria and the return that that money will bring. Overall, there is no doubt that that very considerable investment in the region, which will be well in excess of £ 2 billion over the next few years, will create many jobs and many new business opportunities. It will encourage much further investment into the area.
My organisation, NIMTECH, which, as I said, is a non-profitmaking organisation which hopes to develop innovative technology in the region, has developed a number of projects under the various schemes. Some of them will be extremely interesting. We have been able to obtain 50 per cent. funding for a project that will establish 12 centres around the world in various developing areas. It will enable north-west companies to link directly with those centres using modern methods of communication. Nationals will be working in those countries for the benefit of north-west technology companies. That will give great opportunities to companies which otherwise would not have the resources to have representation in areas such as India, Malaysia and elsewhere. Brazil particularly has already been very effective in this area.
Another project that we have set up, again under the aegis of Objectives 1 and 2, will put onto special information technology systems which will go onto the information super-highway information on 6,000 companies in the North West. That will then be available on a world-wide basis to anybody linking into the super-highway. It will also involve sending out to 2,000 consulates and technology agencies throughout the world information on those 6,000 companies. So anybody can look up immediately the company which might be interested in their products and obtain information on the background of the company, its resources and so on. That can give a big boost to many of our organisations in the North West.
We are setting up an organisation called Merseyside Host, which will bring the benefits of telematics—a combination of computers and telecommunications—so that eventually one can plug one's telephone communication into the back of one's television set and be able to link the two together. Again, that will give an opportunity to buyers around the world to draw immediately onto their computers or television sets on their desks information on a whole range of companies from the north west of England and particularly those in the Merseyside area. There is a particular project which will help to develop new ideas, particularly in the area of innovative technology. Individuals and companies who want to get their ideas into the marketplace will have assistance to do that.
As noble Lords will be aware, the north west of England has eight major universities with 150,000 students and 8,000 academics. Perhaps one can imagine the impact of 8,000 academics when one realises the enormous impact of the far smaller number in this House. We have a number of projects working with the universities now. My experience of the

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universities in the North West is that they responded wonderfully to the new environment which the Government established; namely, to find new ways of using their own services from which to make money, to work with industry much more effectively and to use the technological and wonderful ideas that come from universities to get more quickly into the commercial area.
Again, we have started a project—I am chairman of it—at Manchester University called Campus Ventures Ltd., through which we have made available Brunswick House at Manchester University. That was where the first computer was built. That building has now been made available for new start-up businesses. A person who has an innovative technological idea and wants to commercialise it can have facilities in Brunswick House free of charge for six months. If the idea looks as though it will develop and will be commercially acceptable, although he will still have to pay for the facilities, he will receive support from Business Ideas, and have accountancy and administrative support as well as academic support from within the university. In fact he can draw on people with similar knowledge and learn of improvements perhaps to add to their own innovative technology. There are already a number of people there who are working very well at this project and that will be another successful way forward. Those are some examples of projects that we are now putting together as a result of some of the initiatives from the EU.
I should like to refer to one or two other matters. UNIDO (the United Nations Industrial Development Organisation) has its office in Vienna. It has never had an office in the United Kingdom. It has been very supportive of many industries in other countries of Europe. Over the past few years it has stimulated new major initiatives of up to about 2,000 million dollars. We have now negotiated an arrangement whereby we shall open a UNIDO office in our offices in the North West. I am due to sign the contract in Vienna next Friday. It will mean that this opportunity will be open to many more companies throughout the United Kingdom. It is to be hoped that that will give us an opportunity to learn quickly about major world contracts, particularly in developing countries, for which our companies can bid and with which they can become involved.
A number of noble Lords mentioned unemployment and the fact that our level of growth needs to be higher than it is if we are to deal with the various pressures that each government tries to bring together. It is of concern to many people, as the noble Lord opposite said earlier, that we cannot achieve the 4 per cent. level of growth necessary and that every time we try to do so, other factors prevent us. One wonders, in fact, how much we prevent progress rather than encourage it. Wealth creation is the most important aspect that government and society can pursue. Yet many activities are held back through unnecessary controls and regulations imposed not only by governments, but often also by society.
The noble Lord, Lord McCarthy, referred to unemployment and the difficulties of providing employment opportunities. In Dumplington outside
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Manchester a development which would employ between 4,000 and 5,000 people took 13 years to obtain planning permission before it could go ahead. There was nothing special about the site; most of it was neglected and barren land anyway.
We have just received the recommendations and planning guidance of the North West. It is much more concerned with protection and preservation than with the creation of jobs, business and investment. We received the report on Cheshire. I am familiar with that, but no doubt other counties are exactly the same. It looks at its structure plan for the next 20 years. We do not even know what will happen next year, but Cheshire is laying down its planning limitations for the next 20 years. Once again it is entirely concerned with protection and preservation and does not mention the importance of competition; how we will deal with more competition from abroad; how we will maintain our wealth creation and how we will maintain more jobs.
One of the fastest growing computer servicing companies in Greater Manchester is based in India. It services computers via satellite. Most modern technological installations are now made in such a way that they can be serviced and maintained by satellite without the intervention of human beings. When one considers the implications of that situation, the fact that many structure plans do not take note of it is completely negligent. Society—not just the Government—must come to terms with its priorities. Does it exist to protect and preserve, or to provide jobs, opportunities and wealth for the future? I believe it is the latter that should be our number one priority.
6.43 p.m.
Lord Bruce of Donington: My Lords, the gracious Speech of last Wednesday was the 20th to which I have had the privilege of listening. This time, when I listened to part of it, one paragraph had a certain resonant quality; I felt that I had heard it before. I decided therefore to check on it and found that in the gracious Speech delivered on 15th May 1979 the following words appeared:
"My Government will give priority in economic policy to controlling inflation through the pursuit of firm monetary and fiscal policies. By reducing the burden of direct taxation and restricting the claims of the public sector on the nation's resources they will start to restore incentives, encourage efficiency and create a climate in which commerce and industry can flourish. In this way they will lay a secure basis for investment, productivity and increased employment in all parts of the United Kingdom".—[Official Report, 15/5/79; col. 6.]
In the recent gracious Speech one finds the corresponding paragraph that called the matter to mind, where it said,
"My Government will continue with firm financial policies designed to support economic growth and rising employment, based on permanently low inflation".—[Official Report, 15/11/95; col. 3.]
What has happened during the past 16 years? What happened to all those firm policies laid down 16 years ago? For 16 years the Government have had completely uninterrupted power; nobody to challenge them; large majorities. They succeeded in hobbling the trade union movement to a point where opposition is virtually nil, and yet what have they done?

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For the purposes of greater accuracy, I felt that one could make one or two comparisons between the state of affairs in 1979 and 1995. Most economists, including the noble Lord, Lord Skidelsky—I am glad to see that he is speaking today—will agree that the balance of trade is an important aspect of our economic fortunes. I find that when the Government took office in 1979 there was a trade surplus in visibles and invisibles taken together of £ 700 million. At the end of last month there was a deficit of £ 7 billion. That does not sound to me like encouraging economic progress.
All members of the population are part of the nation's economy—or should be—yet one finds that the poorer 10 per cent. of the population have become poorer in those 16 years while the richer section have become richer. I do not call that progress in ordinary terms. It may be progress for the guests at the Lord Mayor's dinner; it may be progress for those who are fortunate enough to hold large financial interests in the City or in large public utilities; but it is not progress for the United Kingdom as a whole.
The worst aspect is the unemployment situation. My noble friend Lord Barnett was a little generous to the Government on that account. Registered unemployment in 1979 when the Government took office was 1,295,700. At the latest count those unemployed and claiming benefit amounted to 2,212,336. That means that unemployment is nearly 1 million higher now than then. Looking at the economy as a whole, that does not sound to me like progress.
But that is not the end of the story. The method of counting has changed and many other changes have been made. I had the opportunity of examining the Report of the Working Party on the Measurement of Unemployment in the UK, recently published by the Royal Statistical Society. It makes rather depressing reading for anyone interested in the facts. On its calculations, reproduced in Table 1 on page 13, unemployment changes because of the changes in the basis of claiming. One must remember that "unemployment" means unemployed and claiming benefit. By reason of a periodical change to the rules, unemployment on that basis should be 1.5 million more than it is now. The noble Lord should not wince before the lash falls.
I am not taking that figure; I am taking what is possibly a more reasonable figure and less prone to speculation. I am taking the figure based on the Labour Force Survey made every three months by the Department of Employment, recently deceased for some reason or other. That puts the total figure at 1 million more than it is now. The unemployment figure should be increased by another million. Therefore, although on the official count the figure has gone up by 916,000 the actual figure has gone up by over 2 million based on the Department of Employment's own figures published in the Labour Force Survey.
That does not sound entirely promising. It cannot have been promising from the Government's point of view either because every now and then they make an aside that reveals their true state of mind. Noble Lords will recall the famous observation by the Prime Minister
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no less that "If it is not hurting, it is not working". That does not sound a favourable verdict on the actions of the Government. There is another by the former Chancellor of the Exchequer, Mr. Lamont, who made the observation that unemployment is a price well worth paying. That does not sound like a competent government, but as though they are becoming a little apologetic. There is the latest comment by the President of the Board of Trade. He said, "Job insecurity is a state of mind". That was said by Mr. Lang only a week or so ago. These are not competent observations by any government.
By selective figures based on certain dates and times, the Government can produce figures which satisfy them, but they cannot really satisfy anybody at all. They are not competent about them. One hears from time to time how the Government's policies have been so successful and how they are the foundation of success today. I repeat: the country does not believe that. People living in the stockbroker belt and those who receive very large salaries in positions of responsibility, are the only people who can find anything to say in favour of them at all.
I believe that unemployment, and the way in which the Government have dealt with it, is one of the fundamental weaknesses in our whole situation. We have thousands of people who are willing and able to work. We have a situation in which all the materials are already available to be assembled, yet for some reason or other it is not possible to do so. That flies in the face of all logic and normal reason. I was very glad to hear today the reaffirmation by my noble friend, Lord Peston, of the principles set out by Lord Keynes before the war, which no doubt will be reinforced by the noble Lord, Lord Skidelsky—that is to say, that investment is the main factor.
The Government and my noble friends have said (and we all know perfectly well) that the education of the workforce itself is one of the vital factors in enabling full employment eventually to take place on a practical basis. One knows that. Education and further training, both technical and otherwise, is necessary. But how does one provide the jobs for which the workforce is being trained? It is all very well to train people to do things and to have wonderful schemes. My own party as well as the Government have produced some for education and for getting the unemployed into what is called "pre-work situations". That is all very well, and I applaud it. But who is going to ensure that there are jobs available following training? That is a matter of fundamental economic policy and investment.
From time to time we hear glowing tales from noble Lords opposite—and I applaud them—about foreign countries and investors who are investing in the United Kingdom. However, one thing is quite clear, and the figures bear this out: British financial firms do not do that. In fact, the sums invested abroad by British financial interests are double those which are invested by other countries in our own. Therefore, there has to be some way in which more investment takes place. There should be technological investment accompanied by the state investing in individuals by providing them with greater educational facilities. The two go together.

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So far, the proposals for making investment in the country by British financial interests have rested on persuasion. It has all been tried before. Mr. Edward Heath (as he then was) tried it. We all know about it and I can turn up the speech if necessary. In 1972 he said to representatives of finance capital in the City and generally, "I have given you every tax inducement and every concession by rates and allowances, and so on, and still you will not invest". We have exactly the same problem here today, but within the context of a system of no exchange controls and of complete freedom for British financial interests to make investments wherever they like in the world. They are being made in the United States and in the states of the Pacific Rim. They are not being made here.
Let us say, for example, that my noble friend is sitting on the Government Front Bench in a few weeks' time—and I sincerely hope that he will be—as a Member of a Labour Government. Let us say that he offers inducements to financiers to invest in the United Kingdom. He offers more capital allowances, special rates of tax, if necessary, and special concessions and subsidies. What happens if they do not respond? What is one left with then? The noble Lords, Lord Peston, Lord Skidelsky and Lord Desai, know that the only way of providing necessary investment in the United Kingdom for manufacturing industry is by the state itself becoming an investor. The noble Lord, Lord Skidelsky, and I will give him chapter and verse on Keynes in the matter. That is the only way in which it can be done.
What are we doing in the meantime? We are offering verbal inducements, whether at City lunches or elsewhere, for co-operation with private capital, for the raising of finance and for all proper schemes that can be carried out either separately or jointly. In short, we are trying to persuade, but at the same time we are trying to discipline. There is always a tendency to discipline. I think that it is a pity that we should direct our disciplines towards the disadvantaged, the disentitled and the distressed rather than where they should really be directed. I sincerely hope that will be done in the passage of time.
In the meantime, the economy of the United Kingdom remains firmly in the hands of capital. Capital in the United Kingdom has more powers and has taken more powers in the past 15 years than were ever accorded to it by its own enclosures under the Inclosure Acts of previous years when capital seized the land. Until the country wakes up to that, there can be very little hope.
Meanwhile, I say this to your Lordships: there are three factors to take into account in the economy: poverty, property and democracy. As my late friend Aneurin Bevan said—his words still ring true down the ages:
"Either poverty will use democracy to limit the powers of property, or property, in fear of poverty, will destroy democracy".
7.2 p.m.
Lord Skidelsky: My Lords, I was very impressed by the diligence of the noble Lord, Lord Peston, in unearthing a 1929 quotation from Keynes calling for a
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budget deficit to reduce unemployment. What the noble Lord did not say was that that proposal was made against the background of a balanced budget, not a continuous budget deficit; that it was made against the background of falling prices, not rising prices; that it was made against the background of a fixed exchange rate, not against the background of a depreciating currency; and that it was made to deal with an unemployment problem which was very different from that which prevails today. If being a Keynesian is simply to echo the master's words without any regard at all for the context or circumstances in which they were uttered, I am not a Keynesian and I venture to suggest that Keynes would not have been either. Keynes had the capacity for learning from what was happening, which some people signally lack—
Lord Peston: Disgraceful!
Lord Skidelsky: No, it is not disgraceful and I am not going to give way. I am not going to give way to the noble Lord's arrogance and attitude of infallibility taken towards anyone who disagrees with him. That is it.
Lord Peston: My Lords—
Noble Lords: Order, order!
Lord Skidelsky: My Lords, I turn now to the noble Lord, Lord Bruce of Donington. I fear that I always disappoint him when I speak. Wherever the noble Lord sees disaster, I see progress. I have seen progress in the British economy over the past 15 or 16 years. We have a motorcar industry which is now thriving whereas it was practically defunct in 1979. We even have a new motorbicycle industry which has just started up. I wish Triumph the best of success. However, I fear that the noble Lord will be disappointed in yet one other respect: he will see more evidence of progress in the economy than he sees in volume 3 of my life of Keynes.
I should like to extend a very warm welcome to the financial strategy announced in the Queen's Speech. I am delighted to know that it is to be the intellectual basis of the Chancellor's Budget strategy. Three objectives are stated: to achieve a permanently low inflation rate; to bring the Government's accounts into balance, and to reduce the share of national income taken by the public sector. I support particularly the last of those objectives—not least because I think that it will make it easier to achieve the first two. Speaking at the Lord Mayor's banquet on Monday, the Prime Minister said that public spending should fall below 40 per cent. of national income. I am very pleased that all Ministers are starting to say that, because it sounds as though they mean it. I believe that we should consciously aim lower—at much nearer 30 per cent. than 40 per cent., but I would not be discontented if we were able to meet half way.
The Prime Minister's more modest objective will still be formidably difficult to achieve. This is not the time or the place to suggest how we should achieve it, although I have my own ideas on the subject. I should like to put forward an economic and philosophical case for trying to get public spending down, and to do so as clearly and as briefly as possible.

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There are four main reasons. First, I think that at our present levels of public spending we have a permanent borrowing problem. The Government's Budget deficit is still about 4 per cent. to 5 per cent. of gross domestic product. Since 1991, despite the increases in taxes, public debt has been rising about twice as fast as national income. Instead of rolling back the state, we have been increasing our deficit spending. Of course, I recognise that it is right that the budget deficit should rise in recessions, but about half of the deficit in the 1990s—I think that that is a reasonable estimate—has been structural rather than cyclical, the carryover of past deficits as well as non-cyclical increases in spending. I doubt whether the Budget has been properly balanced since 1968–70 when the noble Lord, Lord Jenkins of Hillhead, managed to do it. I am sorry that he is not in his place.
Our governments spend more than they take in taxes on a permanent, not temporary, basis. Continuous deficits incurred to finance consumption and capital works that do not yield the cash revenue to service the debt carry the risk of inflation, which means that the Government's creditors demand a higher rate of interest to compensate them for the risk of being paid back in devalued pounds. That is normal. Our long-term interest rates are over 2 per cent. higher than those in Germany or the United States. If we want to bring them down, we need to have a credible deficit reduction strategy. I submit that the only credible deficit reduction strategy is to try to reduce public spending as a share of national income.
However, I should like to go further, which brings me to my second reason for getting public spending down. We have to do it in order to stimulate economic growth. I think that it is intuitively plausible that high public spending ratios slow down economic growth. The empirical evidence for that is quite persuasive. The governments of the fastest growing regions of east Asia spend only about 20 per cent. of their national income. They do that even after they have "caught up" with us, as Hong Kong and Singapore virtually have done.
I do not think that we need to compare ourselves with societies that are very different from ourselves in order to reach similar conclusions. Let us compare ourselves with our own past. Since the mid-1960s, public spending in the European Union has increased by well over 10 percentage points of national income, taxes have gone up and growth rates have come down. Our peak post-war performance—I am referring to this country as well as to other European countries—came when governments were spending little over 30 per cent. of national income. So my figure of 30 per cent. is not simply plucked out of the air. It is the figure that we spent when we were at the peak of our post-war success. Were we so much more uncivilised then than we are today to justify the state spending so much more of our money? I do not believe that for a moment.
People often argue that the increase in public spending has been as a result of a worsening economic situation. I do not believe that to be true, because one can show that it started when we were still growing relatively quickly and when unemployment was negligible. The increase in public spending started in the
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1960s and was designed to increase economic growth which was already reasonably satisfactory. It was not designed to compensate for worsening economic conditions. The fastest growing components of public spending today do not have a direct connection with growing unemployment. For example, legal aid is one of the fastest growing parts of public spending. What connection has that with unemployment? Invalidity benefits, one-parent families, and so forth are mostly part and parcel of the "entitlements explosion" that started in the 1960s and are not a response to a worsening economic performance.
My third reason for wanting to get down government spending is that I believe that levels of government spending which are too high reduce welfare, they do not increase welfare. Growth in national income, which is obviously driven by public spending, is growth in areas which reflect the choices of bureaucrats, not the preferences of households. The extreme example of that was, of course, the Soviet Union which for years trumpeted huge growth rates, based almost entirely on the growth of its military-industrial complex.
Mr. Douglas McWilliams made a very valid point in the Financial Times of 8th November when he wrote that if public spending aims to be an investment in a more prosperous and pleasant society, the return on that investment should be measured by the performance of the market sector alone. There are problems with using real GDP growth as a proxy for welfare.
My last reason is probably the most important of all. I want to reduce public spending in order to increase individual liberty. The greater the amount of resources taken and allocated by local government, the less freedom of choice ordinary people have in the spending of their own money. Basically, I want to reduce the size of the state in order to increase liberty. That does not mean—it is a caricature to suggest this of those who argue the case—a return to the nightwatchman state of the 19th century. Governments who spend less are better able to do things which governments need to do, such as providing decent infrastructure, and even to stabilise economies when economies need stabilising—tasks which are now crowded out by expenditures which are not needed in a privately wealthy economy.
I should like to end by reinforcing one point that has been mentioned by other speakers this evening. I believe that tax cuts should be a consequence of reduced public spending, not a way of winning votes. Therefore I would not favour tax cuts, except as part of a credible medium-term fiscal strategy for reducing the growth of public spending. I believe that to be the Chancellor's view. He has stated that many times and I hope that he will stick to it.
The effect of cutting taxes without cutting spending is to increase borrowing. In present conditions that will push up interest rates. Interest rates are already too high. We need a budgetary policy which produces lower interest rates, not higher ones.
Since 1979, we have made impressive strides in destroying the appeal of what I would call "production socialism". No one believes any longer in the state as owner, but the Government as spender are still alive, are

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still well and are still growing. The harder part of the task still remains. It is to push back "entitlements socialism"—a many-headed monster that grows and still consumes much too much of our estate. So I would commend that as the next task for a re-elected Conservative Government.
Lord Richard: My Lords, before the noble Lord sits down, I wonder whether he and the House will allow me to refer to the incident involving himself and my noble friend Lord Peston which took place at the beginning of the noble Lord's speech. I have to say to him that he should have given way. In my view, there is no question but that when one noble Lord makes a personal attack upon another noble Lord, which it clearly was, he should have given way when my noble friend tried to respond. It was a display of personal animosity and petulance by him towards my noble friend which frankly I do not believe accorded with the traditions of the House. He has not been here very long, and nor have I been here very long. I would only say to him that if he continues to behave like that, then he will find it more difficult to be listened to with respect.
Lord Skidelsky: My Lords, perhaps I may reply to that. I did not intend my remarks about the noble Lord, Lord Peston, to be a personal attack.
Lord Barnett: They were.
Lord Skidelsky: My Lords, if that is how they were taken, I unreservedly withdraw them. I believe that I was entirely within my rights to say that he had misinterpreted that remark by Lord Keynes. I did not think that any purpose was to be served by becoming involved in a debate about what Keynes really meant in 1929. Those debates have filled thousands of pages of learned journals and they are inconclusive.
7.16 p.m.
Viscount Chandos: My Lords, it is a tribute to the creative endeavour and imagination of the 30-odd speakers today that a substantial debate can be derived from what my noble friend Lord Richard described as an anorexically thin gracious Speech. There have been penetrating but fair critiques, not least by my noble friend Lord Peston, of the disparity between the Government's record and the unexceptionable statements of economic intentions contained in the gracious Speech. My purchases to date of lottery tickets have not so far produced a jackpot win, so I do not feel that my luck will change sufficiently to forecast accurately the measures in next week's Budget Statement. I shall therefore leave any comments on the Government's current economic policies until the debate to be initiated next Wednesday by my noble friend Lord Desai.
In the light of that, and the long list of speakers tonight, I should like to speak very briefly on two subjects in specific areas, directly or indirectly alluded to in the gracious speech. So modest are the measures proposed in the last full Session of this Parliament, that the skills of a keyhole microsurgeon are needed—aided by the steady nerves and hands advocated by
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the noble Lord, Lord Jenkins of Hillhead—to identify and isolate some specific subjects to debate. This truly is a "Marie Celeste" of governments, drifting in thick fog with only a ghostly presence on the bridge.
Calling on another literary source, Sir Arthur Conan Doyle might have called the gracious Speech, The Case of the Bill that isn't and of the Bill that (perhaps) needn't be. In the measures proposed in the gracious Speech there is one glaring omission which demonstrates vividly the credibility gap for the Government as they table platitudes about their commitment to the markets, competition and competitiveness. This week, in the annual Wincott lecture, Sir Bryan Carsberg set out his compelling case for careful reform and consolidation of competition regulation in the UK, thereby making even clearer the frustrations which lay behind his resignation a year ago as Director General of the Office of Fair Trading. The inexplicable failure of the Government to honour their past commitments to address that subject can only lend weight to the picture painted by the noble Lord, Lord Jenkins, of a twilight era of an insincere Administration.
In the area of restrictive agreements, a 1989 White Paper made a commitment to reform procedures, and this was repeated in the Conservative Party's 1992 general election manifesto. Since then, the House of Commons Trade and Industry Select Committee this year reaffirmed its support for changes in this area. Yet once more the Government have chosen not to propose legislation in this Session. The modest and inadequate measures foreshadowed by the President of the Board of Trade in another place on Monday go nowhere towards addressing even the limited area of restrictive agreements, let alone the other issues outstanding—and so well set out by Sir Brian—such as the case for a unitary authority to replace the duplicative complexity of the Office of Fair Trading, the Monopolies and Mergers Commission and the Restrictive Practices Court in addition to the different sectorial regulators; the case for restricting ministerial discretion, if only to the limit of that which applies to the regulation of utilities; and for the case for a simplification and rationalisation of the four main and countless peripheral acts covering competition policy.
This is not an omission of some obscure technical legislation which is of relevance only to a few companies and specialist professionals. The most rigorous and stringent enforcement of competition policy lies at the heart of a competitive market economy and that in turn is central to the very objective declared in the gracious Speech:
"to support economic growth and rising employment, based on permanently low inflation".
It is only competition which can bear down relentlessly and automatically on price inflation and thereby create both permanently low inflation and enhanced international competitiveness.
This latest breach of faith by the Government is, I am afraid, only the last in a long line of instances where the Government's bark is far more vociferous than their bite is tenacious. I am reminded of the disparaging dismissal from the American West: "Big Hat… No Cattle".

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I am confident that when the much discussed exchange of Benches occurs and the new government take office, not only will the existing competition laws and regulations be more rigorously and consistently enforced but a new framework of greater simplicity and effectiveness will in due course be introduced.
The Bill which perhaps, or in theory, need not be is the Broadcasting Bill, since without denying the special factors applying to the area of media there are undoubted attractions in seeing the regulation of that industry incorporated in a properly structured and effectively enforced competition regime. As my noble friend Lord Donoughue pointed out, the technological and other developments in the broadcasting and other media are so fast moving that a degree of flexibility is highly desirable but more difficult to achieve within specific legislation rather than within overall competition law.
In practice, however, the complex legacy of the Broadcasting Act 1990 and other legislation and the very failure of the Government, to which I have already referred, to create a consistent and stringent competition environment leads me in the end to support and therefore welcome the prospective new Broadcasting Bill if it incorporates broadly the measures outlined in this year's White Paper. I should declare that I have a number of business interests both as an adviser and as a principal in the broadcasting and media industry which I can detail on a future occasion. I took the reminder of my noble friend Lord Peston of Adam Smith's low view of businessmen as an additional spur to examine my views on the deregulation of media ownership from a public interest perspective. But I am unshaken in my belief, like that of my noble friend Lord Donoughue, that there will be substantial benefits in both economic and cultural terms from further controlled deregulation in this sector. I look forward to the early introduction of the Bill in your Lordships' House.
But that, however welcome, is all that there is to look forward to from the gracious Speech and from the Government Benches opposite. That is apart, of course, from their final departure for a period of well earned contemplation in opposition which, notwithstanding the protestations of the noble Viscount, Lord Astor, I anticipate with renewed hope and confidence.
7.25 p.m.
Lord Tugendhat: My Lords, inevitably, this debate, falling when it does, is somewhat overshadowed by the forthcoming Budget. Therefore, unlike the noble Viscount Lord Chandos, I should like to begin my speech with a few short references to the Budget and then move on to other matters of perhaps more enduring interest.
As regards the Budget, it is right to warn the Chancellor, as have several speakers on this side of the House and on the Cross Benches, that there are many in the markets and elsewhere who are perhaps more fearful of what he might be tempted to do in response to pressure from his own Back-Benchers anxious to close the gap in the polls than about what an incoming Labour Government might do. Therefore, I urge the
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Chancellor—I am sure that he needs no urging from me—to pay heed to what my noble friends Lord Prior and Lord Skidelsky said in their speeches. My view certainly is that the economy has performed well during the past 12 months in absolute terms, certainly in historic terms, and also relative to other economies in countries somewhat similar to our own.
Despite some recent setbacks and bad news—news is rarely consistently good all the time—the outlook for the coming year is encouraging. Most likely, whether in terms of economic growth, inflation, or even in the continued reduction in unemployment, the performance of the economy in the calendar year 1996 will compare very favourably with that which we were used to for most years until quite recently.
I urge the Chancellor not to put at risk what has been gained and to be cautious in what he does. I accept of course that within that context he will be making cuts in income tax. There is room for some modest reductions. However, I hope that he will not go for headline-catching reductions in the basic rate. I hope rather that he will concentrate on getting as many as possible of those on low incomes out of the tax net altogether through raising allowances. I hope too that he will find ways of widening the 20 per cent. band to provide maximum help for those on lower incomes who will still be paying tax.
After those brief exhortations to the Chancellor about the forthcoming Budget I wish to turn to a longer-term issue. It may be bring me into conflict—I hope not—with the noble Lord, Lord Harris of High Cross, and perhaps even with my noble friend Lord Skidelsky. I hope that the Government and the Conservative Party will not be led astray by those siren voices who are suggesting that we should regard the levels of public expenditure prevailing in the economies of the Pacific Rim countries as relevant guidelines to what we should be doing in this country.
Of course, we should study the economies of the Pacific Rim countries and we should try to learn from them. I certainly regard as an enduring achievement of this Conservative Government their success in attracting so much direct investment into this country from Japan, South Korea and most recently Taiwan. I value that investment for what the companies concerned can teach us about management and the application of new techniques as much as for what they have done for the balance of payments. But I think that it would be very unwise to become too carried away by the Pacific Rim successes.
The present assumptions being made in some quarters about the future, about the 21st century, and about the Asian century remind me of the late 1950s and early 1960s when many, including those who detested communism, assumed that the USSR would economically outstrip the West. Certainly, very cogent words on that subject appear in the book written by my noble friend Lord Skidelsky—The World After Communism—which I too read in the holidays.
Of course, the Asian tigers are very different from the old USSR but those who think they have found the answer to everything may care to glance at the

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experience of Japan. I visit that country regularly and I admire greatly its achievements. But whether one looks at its society, its manufacturing or, above all, its banks, one can now see problems on a very grand scale. So let us not forget that progress is rarely continuously onward and upward. Let us also remember how very different the Pacific Rim societies are from our own in so many respects other than the proportion of GDP which they devote to public expenditure.
In the first place, of course, the intrusiveness and sheer authoritarianism of government often provide a substitute for what is done in this part of the world by public expenditure. Secondly, family structures, in terms both of mutual support and as units of economic activity, are very different from what they are in western Europe and especially in northern Europe. Thirdly, the demographic situation of those societies is completely different from ours. At present, they have a much higher proportion of young people than is the case in this part of the world. Their forms of social discipline are very different from ours. And finally, perhaps above all, their attitude to the acquisition and application of knowledge is very different to that which prevails in this part of the world.
Therefore, for all those reasons, I believe that the comparisons which are being made in some quarters of the Conservative Party between ourselves and the Pacific Rim countries are unwise and the lessons are difficult to draw. I hope that in framing our policies we shall be more influenced by our own circumstances and the experience of societies similar to our own than those of the Pacific Rim. By "societies similar to our own" I mean of course the member states of the European Union but also Switzerland and the United States. If one takes that broad band of countries, one sees a wide range in the proportion of GDP that is accounted for by public expenditure.
By that standard, too, I think that the Government's record in transferring the provision of goods and services from the public to the private sector is already good. I think that it could be carried further. In particular, I believe that there is a greater role than has hitherto been realised in the provision of pensions and healthcare. I must declare an interest as the chairman of Abbey National, a major provider of financial services of a variety of different sorts. But, on the basis of that experience, I should like to point out in particular to the Government the very worrying situation which is developing in relation to long-term care.
At present, it is a source of immense worry and sometimes real anguish both for those who have to go into long-term care but also for their families. A lifetime's savings can be used up in a very short time at the end of a person's life. Indeed, in a sense as a result of the £ 8,000 rule, those who have saved up diligently throughout a lifetime and who have tried to prepare for difficulties at the end of their lives in some ways are treated worse than those who have lived merely for the day and who have not put money aside to see them through their old age. In that regard, I believe that there
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is a very real role for the private sector and for government if the Government could provide the proper tax incentives and structures.
In my view, the Government should be guided by three main considerations. First, individuals should be encouraged to start making provision as early as possible in life, just as for pensions. Secondly, a scheme should be launched as soon as possible because of the huge increase in the demand for long-term care which will arise in the next century. Thirdly, guidelines need to be agreed for determining the extent of the insurance companies' liabilities on the one hand, and thus the level of premiums, and on the other hand, the obligations which will remain with the state over and above those which private provision can meet.
The Government have a very good record in transferring responsibilities and the provision of a number of services from the public to the private sector. There is more that can be done. But it behoves us to remember that whatever happens the role of public expenditure will remain substantial in our society. Not everyone can look after themselves. Economic and technological change, social upheavals and sheer human frailties will see to that. Job uncertainty and unemployment will remain features of all western economies for as far ahead as I can see. Therefore, huge sums will continue to be required for public expenditure on health, social security and education as well as law and order and the basic infrastructure on which the private sector depends.
By all means let us do all we can to ensure that public expenditure is not excessive. By all means let us look at the examples of other countries with circumstances similar to our own. But the Conservative Party would be wise to devote at least as much attention to trying to make public expenditure as effective as possible rather than trying to diminish it as much as possible.
7.37 p.m.
Lord Haskel: My Lords, my noble friend Lord Peston spoke very forcefully about the importance of raising productivity and right on cue, the noble Viscount, Lord Astor, told us that the social chapter and the minimum wage would stand in the way of that. I am sorry that the noble Viscount is not in his place because, usually, he is very thoughtful in his remarks on industry. But when it comes to the social chapter and the minimum wage, he and many noble Lords opposite seem to lose their objectivity. They exaggerate the financial costs, if any, and ignore the benefits in terms of social cohesion and the quality of life.
Perhaps I may try to put some balance into this debate and look at the matters in an even-handed way. I have yet to meet an employer who does not agree with the 12 principles which are outlined in the social chapter. Those principles relate to such matters as free movement in the community, health and safety, consultation, equal rights for men and women and the protection of children. They are not a set of rules with the force of law. But each firm may interpret the principles in its own way so that businesses do not have to carry out inefficient and costly practices. The need to remain competitive would soon stop that.

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The need to be competitive is paramount. In spite of what the continental friends of the noble Viscount, Lord Astor, say, it is clear to me, as an employer, that successful, world-class companies do not focus only on their own financial criteria but also on people, relationships and technology. As business becomes more competitive, not only do you have to retain good people, but you have to get them to work with greater commitment, skill and determination in order to perform to the much higher standards which are now demanded.
The latter involves obligations both ways: the obligation of the employee to perform better so that the firm can be competitive and the obligation of the employer to be fair. That is the basis of the social chapter. It is not a threat to good companies; nor is the minimum wage. Most business people I meet recognise the social justice of having a floor under wages. Without it, you have the social security system subsidising those businesses which have low investment and which pay poor wages. That is neither efficient nor is it fair.
Of course, much depends on the level at which the minimum wage is fixed and a Labour government are committed to fixing the level only after full consultation with business. Compare that with the abolition of the wages councils. We were promised by the Government that employment would increase in those industries where the wages councils were abolished. That has not happened. In fact, there has been a fall in employment. Nor will jobs be lost because of the introduction of a minimum wage.
However, those matters, while important, cannot make a difference between economic success and failure. The fact remains that, in competitiveness, Britain ranks way below those countries with a minimum wage which have signed the social chapter. To be exact, we are 23rd in the productivity league table. I agree with the Minister and my noble friend Lord Bruce. What makes a difference is investment: the quality of investment and the amount of investment.
I have in mind investment in technology, in infrastructure, in research, in skills, in education, in new markets and in new products. I salute noble Lords opposite who encouraged this country to change by exposing us to international competition. They certainly forced many companies to change their out-of-date methods and technologies and eliminate many restrictive practices. Sadly, that is no longer enough. As a result, as the Minister told us, not only have we been declining in the league table of productivity, but also in the tables of income, investment and employment growth. Never mind that we are below Germany, Japan and the United States, but now even Italy invests 19 per cent. more of its gross national product than we do. In those circumstances, can we really call ourselves the enterprise capital of Europe? We have to be realistic, and the task of government is to reverse those trends.
I am not alone in calling for the Government to reverse those trends by encouraging more investment. The CBI has said that one of its
"primary concerns is the relatively poor historic investment record, which has not improved significantly in this recovery".
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The British Chambers of Commerce have called on the Government to provide the right environment for sustained capital investment. The Institute of Management and the Engineering Employers' Federation, have all called for this.
I think that those organisations will share my disappointment that the gracious Speech did not specifically mention encouraging investment, especially as we are currently experiencing the slowest growth in investment in any post-war recovery. I hope that the Chancellor of the Exchequer will put that right with a Budget that encourages investment instead of consumption.
How can we encourage that investment? Certainly, low inflation and a smooth economic cycle are essential to create confidence. But active encouragement is also required. Perhaps I may suggest four ways in which that can be done. First, we should have a modern competition policy. My noble friend Lord Chandos reminded us of the importance of the latter and, at long last, the President of the Board of Trade announced on Monday that he was coming round to that point of view. As my noble friend said, competitiveness overseas depends on greater competition here.
Is competition really served by the merger of privatised water and electricity utilities, before there is proper competition in either of those businesses? We have some wonderful, world-class firms, but also weak performers in certain sectors. A proper competition policy will either force those companies to be more competitive, or force them out of business. Staggering on in a sheltered market only diminishes our performance in that area of business.
Secondly, we need to get away from the old ideas of adversarial relationships. The relationship as regards employees, shareholders and management needs to be one of co-operation. The public and private sectors must also work together. I welcome the partnership between government and industry to introduce best practice. I believe that that is a very important initiative on the part of the Government. I also welcome the private finance initiative. However, to make the latter work much more flexibility will have to be built into it.
Thirdly, we must modernise our welfare state. Instead of just providing a safety net, it has to become a means of providing pathways from welfare to work. Instead of being a poverty trap, welfare can encourage and enable people to find employment and gain skills. That will encourage investment by reducing the skills' bottleneck. The proposal of the shadow Chancellor of the Exchequer to cut the starting rate of tax to 10 per cent. is an integral part of our welfare-to-work proposals. The noble Lord, Lord Tugendhat, intimated that he, possibly, agreed with that proposal.
Fourthly, we need a fair tax system that rewards hard work and encourages long-term investment, as opposed to rewarding short-term speculation. Most of us would agree that there should be a difference between taxing the profits from a business built up over many years and providing useful products and services, as opposed to profits made from short-term, speculative financial activities.

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However, there is an immediate problem of sluggish growth. That is why the shadow Chancellor of the Exchequer recently proposed that, in next week's Budget, the Chancellor of the Exchequer should double the first year tax allowance for new investment from 25 per cent. to 50 per cent. for a limited period of 12 months.
The quality of investment is as important as the quantity. I have heard it said that the low ratio of investment to industrial output in Britain indicates that we have a higher quality of investment. That is nonsense. Those of us working in industry know that much of our current industrial output is attributable to exports due to the effect of devaluation, particularly since we left the ERM.
The Minister told us about our success in exporting, but I am afraid that the noble and learned Lord was being selective. He did not tell us that our importers are doing better than our exporters. The August trade figures published earlier this month showed a further worsening of our annual trade deficit to £ 11.4 billion. Only yesterday, the trade figures for non-EC trade showed a £ 1.2 billion deficit—the worst figure in that series on record.
The situation cannot continue. So it is to be hoped that some of last month's surge in imports was in capital goods which will eventually help to improve our performance. But the brutal fact is that, although exports have risen in recent years, as world trade in general has risen, the volume of imports into this country has risen faster.
My noble friend Lord Bruce of Donington also reminded us that the same principle applies with inward investment. According to my noble friend, for every £ 100 which comes in, British companies invest £ 200 overseas. My figures show the latter as being £ 160. We should be a little concerned that that inward investment is substituting investment by UK companies in Britain. It is not in addition to investment by British companies in this country as it should be; it is instead of.
Prior to the gracious Speech we were told that one of its purposes was to "smoke out" Labour's true commitments; to set an electoral trap. I am not afraid of being smoked out. My commitment is to the success of British industry. It is not a matter of party politics; it is the public interest which should motivate the gracious Speech. It is a matter of supporting those policies which are in the best interests of all of us with a stake in British business.
7.50 p.m.
Lord Vinson: My Lords, I happen to think that the Government are to be much congratulated on the progressive fall in unemployment; indeed a steady continuation of their present policies will ensure this drops well below the 2 million mark and keeps going down. But, of course, central to these policies is the importance of having a lightly regulated economy and a flexible labour market. I wish to speak to that.
It is common ground on all sides of the House that we want to see unemployment figures as low as is humanly possible. I do not doubt the good will and intention of
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those on the opposite Benches, like the noble Lord, Lord Haskel, but I am convinced that, in the unfortunate event of their returning to power, if they instituted the labour and other regulations they have advocated in many a debate in this House over the past few years, the consequence would be a massive rise in unemployment.
With rare exceptions they do not realise the malign consequences of what they seek. Many of them are by background so trade union oriented and so conditioned to promote the interests of those in work that they fail to see that these can often be entirely damaging to those out of work. Excessive job protection measures inevitably lead to job destruction. I wish to illustrate that by telling noble Lords of one of the most momentous events in my life, apart from marriage. I took the decision to increase the workforce of my business by 100 per cent. overnight. I moved from a business employing myself to a business employing someone else and with that step I became an employer. One has to do that to know how vulnerable one feels when one risks all in this way.
In the United Kingdom there are approximately 3.5 million self-employed people. It has often been said that if only half of them employed one other person, unemployment would be virtually banished. This past year a quarter of a million new businesses were formed and over the same period 195,000 businesses closed down. That is a failure rate equivalent to some 80 per cent. of the new starts, so anything that can be done to improve the survival rate of small businesses would improve employment. The reason so many businesses fail is not hard to find. They are often forced to their knees by over-regulation. The sheer complexity of running a business today is not so bad when one has others to whom to delegate; it is a nightmare when one is virtually on one's own.
I illustrate that with the imaginary tale of Mr. Jones, an electronics engineer. As a hobby he developed a promising device which he took to a potential customer. The customer liked it and told him that he would buy from him. Mr. Jones therefore left his job and became self-employed. His wife also left her job in order to help him. They set up in a back room of their house. Living on their savings was not easy but through hard work and good fortune they obtained repeat orders. Mr. Jones had started down the classic route of the entrepreneur, the job creator.
It was then that they took the monumental decision to increase their labour force by 100 per cent.—by one person—and their payroll costs by 100 per cent. which reflected that one person. In so doing they became an employer. It was here that their troubles began. They came to terms with the complexities of PAYE, National Insurance and VAT when one day their new employee announced that she was pregnant. As the exemption limit had recently been changed by the newly elected socialist government, the responsibility for paying her now fell on them. That was a further call on their precious capital.
They replaced the employee by a part-time worker, realising that in turn she would have to be dismissed when the original employee returned from maternity

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leave. But, sadly, the part-timer proved to be unreliable and they were forced to dismiss her. The law had recently been changed giving part-time workers the same rights as full-time staff. She took an action against them for unfair dismissal. All her costs were paid by her trade union while the Joneses had to fund their own defence. Whilst this was going on their neighbour reported their activities to the planning inspector. He arrived and, acting within his rights, he ordered them to cease trading from home shortly or face prosecution. They were beginning to get deeply embroiled in officialdom on all fronts.
They then advertised at some cost for a new temporary employee and, after interviews, they appointed a candidate who happened to be black. One of the unsuccessful white candidates then brought an action against them for discrimination, supported by the Commission for Racial Equality. Here again, the Joneses had to conduct and pay for their own defence. They were now spending more time on the administration of their business than they were on the manufacture of their product—their livelihood.
An acquaintance of theirs was severely handicapped but they offered him the job at a lower wage than normal because, due to his disability, his output was slow. Little did they know that within days this would lead to an official visit from an agent working under the auspices of the new minimum wage regulations who warned them that they would be severely fined unless they increased his wage to the full rate. Their costs of production increased significantly as a consequence. The agent also advised them that as the new socialist government, honouring a promise they had made in the House of Lords in 1995, had removed the small company exemption, they would in future have to make any new premises accessible to the disabled at a cost of about £ 2,000 which would fall on them. That was a further blow to their ever diminishing capital.
At this point the entrepreneur's wife became pregnant but because she was not an employee as such she was not entitled to maternity pay, yet they were still paying it to an employee who was not working for them. They then hired an additional person who, after expensive training, did the job admirably. However, one month later, their original employee returned from maternity leave and asked for her job back. Although they felt great reluctance, to accommodate this they had to dismiss her wholly satisfactory substitute. After a week the re-engaged employee left.
Our hero is in desperation. He has no time to run his business; he is disappearing under a mountain of regulations and costs; his wife is out of action unassisted by the state and yet he has been paying for the pregnancy of another's wife and subsidising a disabled neighbour. He faces litigants with unlimited legal aid whilst he has no prospect of recovering his costs.
Lord Graham of Edmonton: My Lords, is the noble Lord giving us facts, or is it fancy? If he is giving us facts, would he care to produce them?
Lord Vinson: My Lords, I am just about to reach that point. I am trying to illustrate precisely what would happen if the very measures that have been advocated on the noble Lord's side of the House were introduced.
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As a final throw—this is one of the many true facts—Mr. Jones decides to let out his spare bedroom and take in a lodger, but within a week the fire officer calls and tells him that his furniture does not comply with the 1990s fire regulations. Whilst it is allowable for use by guests, it is illegal for lodgers. That is happening today. Mr. Jones is worried sick. His basic business has suffered deeply and he can hardly sleep at night. He goes bankrupt. It is almost with joyous relief that he goes to register for unemployment benefit only to be told that as a self-employed person he is not entitled to it. That is happening today.
One month later after rigorous assessment he is allowed to go on social security. Miraculously he is entitled to housing benefit and income support totalling £ 200 a week. That is substantially more than he and his wife had been struggling on for the past six months. Our entrepreneur, killed off by the complexities of state regulation, embraces the state for ultimate survival. These things are happening, can happen and will happen. This is a salutary tale, part fabricated but part true.
Noble Lords: Oh!
Lord Vinson: My Lords, noble Lords may laugh but that is precisely the consequence of the type of legislation that those on the opposite side of the House wish to introduce. It is the consequence of minimum wage legislation and the consequence of removing—as they have said they intend to remove—the ceiling on the exemption for small businesses under the disability Act. This will impinge on the very sources of job creation, and that is why it is so important to discuss the proposals. I realise that perhaps I am like a mole talking to the eagles who only discuss higher things, but this illustrates how the economy of this country actually operates.
All I can say is thank God for the guts of the small businessman, who, despite the EC and other regulations, is responsible for the growth sector of the economy. But his position is very fragile. Few realise how important the small business sector is. Most large firms are down-sizing. New employment is coming mainly from small firms, and most firms are small firms. If their failure rate could be reduced by 50,000 a year, within a decade we would have created hundreds of thousands of new jobs without a penny of government subsidy.
It is worth repeating that the vast majority of businesses are, by any definition, small, and firms employing fewer than nine people make up 94 per cent. of all businesses in this country. Small firms employ over 10 million people—well over half the total of non-government employment—and the figure is rising. That is why this matter is so desperately important.
There are two primary causes of unemployment in the United Kingdom today. One is over-regulation, and the other is the excessive taxation of labour, thereby raising its cost. If one raises the price of anything people use less of it. Any socialist government would, exacerbate both maladies.
As has been said earlier today, one has only to look at the deregulated economies of America and of Hong Kong, for example, although they are not totally

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comparable. Their standard of living, by the normal indices, will shortly surpass ours. One has only to see how less-regulated economies create jobs. That is what we should share in common.
Unemployment is to some degree a national self-inflicted wound. Here, society has made formal what should essentially be less formal—the process of buying and selling one's labour. In so doing we have frustrated the natural workings of the exchange of labour and thereby the creation of jobs. We should learn from the workings of the informal economy, which is only black because society deems it so.
One also needs to look, by contrast, to France and Spain, with unemployment levels in excess of 11 per cent. and 22 per cent. respectively, to see what happens to small businesses and the creation of jobs in an over-regulated economy. I remind the noble Lord, Lord Barnett, whose speech I much admired, that in fact employment growth in continental Europe in the past decade has been in the public sector. There has been virtually no overall new employment created in the private sector at all. That is what so many of those on the opposite Benches, unknowing of the consequences, seek to achieve. They do not do so deliberately, but they should remember the cautionary tale of Gulliver's Travels:
"No single thread held him down but a thousand made him immobile".
The road to the dole queue is paved with good intentions. The price of excessive job protection is job destruction. It is for that reason that the Government are to be supported and applauded for their policies aimed to create flexible labour markets and a less regulated economy to the overall benefit of the nation.
8.3 p.m.
Viscount Caldecote: My Lords, in opening the debate my noble and learned friend Lord Fraser gave a faithful and encouraging report of the achievements of this Government in the economic field. However, he recognised, as we all do, that much more needs to be done.
I also enjoyed the speech of the noble Lord, Lord Bruce. It was all good Donington humour. Of course, he was pulling our legs because he knows as well as we do that there have been enormous achievements and improvements since 1979. I share his diagnosis of inadequate investment, but I wholeheartedly reject his prescription of a return to nationalisation. I fear that that is not "new Labour" and he may be in trouble with Mr. Blair.
The gracious Speech contains several references to promoting economic growth and increasing employment through reduced taxes, low inflation and many other good objectives. However, I very much regret that there is no reference to the importance of investment to meet identified market needs for that is the basis for achieving all the good intentions mentioned elsewhere in the gracious Speech.
Tax reductions are enjoyable and encourage enterprise but past experience indicates that lower taxes do not always lead to increased investment. Individuals
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tend to consume more and companies to distribute more, leading to increased consumption rather than investment. British companies still continue to distribute a far higher proportion of their gross profits than most of our competitors, and the tax system is biased slightly in that direction. That should be corrected.
Low inflation is also a necessary condition to stimulate enterprise and investment. Lower interest rates are also highly desirable because they lower the hurdle rate of return when investment decisions are being made and so encourage investment. As other noble Lords have pointed out, we have had low inflation for some time but investment still lags behind our competitors. That is important because the analysis of OECD figures shows a clear relationship between GDP growth and investment as a proportion of GDP. We are way down at the bottom of the league.
As a result of inadequate investment, every time growth accelerates inflationary pressures increase because demand from the rising amount of money in circulation outstrips our ability to supply goods and services in the UK for that money to buy. Although our productivity has improved markedly over the past 10 years, import penetration—imports expressed as a percentage of the total home and export demand—is still very high. It is between 30 per cent. and 70 per cent. in many important industries. That means that there is still a huge home market demand unsatisfied by domestic manufacture.
Why do we import so much of our requirements? The main factor is the lack of competitive products through failure to invest adequately in product innovation. We are all too prone to talk only of investment in capital. Investment in product development and innovation is at least equally important, and in many cases more important, if we are to satisfy more of the needs of the home market, provide more jobs and improve our balance of payments.
The time to invest in plant and equipment and in product development and, equally important, in training is during times of recession in order to be ready for the next upturn in demand. If one invests only when the going is good one is only ready to use the new plant when recession returns. In too many industries investment is as badly timed as it is inadequate. Successful companies surmount those difficulties, but there are too few, and we urgently need greater incentives to counter-cyclical investment.
I hope that the Budget will make a start in addressing those problems and that the Chancellor will at least give greater first-year capital allowances for investment in plant and equipment. I do not follow the noble Lord, Lord Haskel, in wishing those to be for one year only. That simply distorts the market and may even encourage unsatisfactory and wasteful investment. I hope that they will be permanent and will gradually increase to 100 per cent. That would be a valuable incentive to profitable companies, but more needs to be done for companies recovering from the recession and those striving to enter new markets.
The Government should certainly not try to pick winners. They have tried to do that in the past and it has been a failure. We should look critically at the money

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being spent on DTI initiatives such as Technology Foresight and Link programmes. Admirable though those are, the resources allocated to them will only be good value if they lead directly to new competitive products and services to meet more home as well as export demand. Might it not be sensible to divert some of those funds to the more direct support of winners picked not by Government but by industry, through co-operative programmes of risk and reward sharing? That is particularly apposite to the regeneration of run-down industries and in cases where high risk is associated with major benefits to the national economy. An example is capital goods. If we divert some consumption to investment, we want that investment to be made in the UK rather than outside it, as has so often happened in the past, drawing in imports of plant and equipment because they are not available in the UK.
Two arguments are often used to downgrade the importance of achieving a positive balance in our overseas trade. First, any deficit can readily be balanced by capital flows. Surely that is simply one way of selling the family silver to pay for current overspending and must be damaging to the economy in the long run. Secondly, it is said that inward investment, which we have been very successful in attracting, is an entirely satisfactory way of balancing the books. In the short term, that is true, but I do not believe that we want to see more and more of British industry owned overseas, with the profits going overseas. Nor does that contribute to national pride and confidence.
This question is also posed. If foreign companies find investment here so attractive, why are British investors so reluctant to make similar investments even when the expertise is available in this country? I believe that the answer is the old bogy of short-termism which we have still to tackle and beat.
Higher investment within the UK is the key to economic prosperity, more jobs, sustainable development, and our ability to provide full support to education, the arts, health, overseas aid, child care, housing and all the other things for which we should like to make better provision but cannot now afford. We must not let short term advantages or narrow dogmatism stand in the way of greater investment.
8.12 p.m.
Lord Monkswell: My Lords, I wish to say a few words about the illusion and reality of industrial performance and economic affairs and to speak about the visibility that we need to ensure through Parliament.
I had thought that this would be what might be described as a two-sided debate, with the speakers on this side of the Chamber speaking about the realities of life and those on the other side speaking about their illusion which is the figment of the Tory Government's propaganda machine. I am immensely relieved to have just listened to an important speech from the noble Viscount, Lord Caldecote. He threw some light from the other side of this Chamber on this important subject.
In talking about the distance between illusion and reality, I need only refer to the two opening speeches in the debate. The noble and learned Lord, Lord Fraser of
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Carmyllie, spoke of low inflation, privatisation, reduction in business taxes, flexible labour markets and rising exports. However, it fell to the noble Lord, Lord Peston, to point out that we have mass unemployment, low investment, profligate consumption, poverty wages and imports higher than exports and rising.
I was interested to hear some of the contributions in the debate. The speech by my noble friend Lord Bruce of Donington was one of the most stirring performances that we have heard in this House for a long time. It almost moved me to start singing "The red flag", but perhaps that is not necessary given that we have such glorious red Benches in this House. I was a little concerned about the contribution by the noble Lord, Lord Wade of Chorlton. He highlighted the situation regarding the development of Dumplington Circle. He pointed out that that development had been held up for several years, and that it would provide a good number of jobs. However, he did not tell the House that the development of Dumplington Circle in the way that he described would have caused immense loss of jobs in the centre of the conurbation of Manchester and created a number of environmental problems, apart from tearing the heart out of the city. That was the other side of the equation. It is interesting that even Government Ministers now appreciate the problems of massive out of town shopping developments.
The noble Lord, Lord Skidelsky, spoke of the fast growing economies of the Pacific Rim countries. He pointed out that their public expenditure was a lesser proportion of gross domestic product than that of this country. He suggested that that was a reason for their fast economic growth. I watched a television programme recently on Singapore—as we are told, the jewel in the Pacific Rim crown, if one may put it that way. However, while the share of the gross domestic product consumed by public expenditure directly may be fairly small, there are two factors in the equation. The first involves the direction of their economy through the housing market. On the one hand it demands high standards of housing but also requires rent commensurate with the development. That is effectively forced upon the population. The second involves the very high savings demanded by the Government of their population. Although the Government do not actually spend the money generated in the economy, they direct how that money will be spent or saved. To highlight one element of the economic affairs of the country is not necessarily the right way to make sensible comparisons and judgments between different national economies.
I had hesitated to become involved in that argument. Perhaps I am safe because neither of the two protagonists in the economists' battle which raged earlier in the House are present. I am not an economist. It struck me that it might be useful to give the House a couple of examples of how the way in which the Government run the economy works in an anti-social way. In considering tax cuts—the noble Viscount, Lord Caldecote, referred to them as giving rise to profligate consumption—perhaps I may cite an example. A young man in the City earns a great deal of money. He is not heavily taxed. What does he do with his

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money? He buys a BMW or a Porsche and goes on foreign holidays. What is the effect on our economy of that individual's action? It upsets our balance of payments. It takes money out of our economy and puts it into competitor economies. When a large number of people do that, the effect is very adverse.
I give another example from my own experience. BT rang recently saying, "Because you are a high user of phone services, we are prepared to give you a discount on your bill". I said, "Hold on a moment. If you are going to give me a discount, you will still want your corporate profits to be as high as they have been historically since privatisation. So what will happen?" They could not quite answer that, and I suggested that what would happen in practice is that the charges for those people who use their phones less often would increase. It is a natural balance. If the charges for frequent phone users go down, the prices for infrequent phone users must go up. Who uses phones infrequently? It tends to be people on low incomes, pensioners living on the state pension.
I found the idea that my family and I, who are comparatively well off, should pay less and pensioners who have seen an erosion of their state pensions should pay more rather anti-social. I refused to be involved in that scheme, but how many other people did not make that connection and accepted the discount?
We need to recognise that sometimes the systems and procedures, the ways of working that we set up which are allowed to go ahead in our society, create anti-social effects. Some people have talked about privatisation as being the panacea. It is interesting to see the effect of nationalisation. One of its key effects was to ensure an investment in modernisation in those industries. Unfortunately, we can see that, for example, the privatisation of the water industry has not led to higher investment but to high dividends to shareholders and high pay for directors of those industries.
I had not planned to speak for as long as this, but perhaps I may touch finally on what I would describe as "parliamentary visibility". I admit that my contribution so far has been partisan, but now I hope that I speak not as a Member of these Benches but as a Member of the House. In the gracious Speech there is the sentence:
"In Scotland, legislation will be introduced to reform education and training".
It has not been easy to find out what that legislation is about. There is no reference to it at the Printed Paper Office. It raises a problem because there have been attempts by the Front Benches, the usual channels, to take business off the Floor of the House. I understand it because no one likes late night sittings. The pressure of business on the House makes it sensible to suggest that we take business off the Floor. We did so last year with the Children (Scotland) Bill. A number of procedural problems arose and I suggest that there is also a political problem in the way in which the Leader of the House suggested that we might tackle Scottish legislation that started in this House this year.
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I wish to say a few words on procedural problems. First, when the Committee stages were listed in the Minutes of Proceedings and the Notice of Business, they were listed at the back of the document. Those of us who tend not to take a great deal of interest in Select Committee affairs but take an interest in business on the Floor of the House tend to look at the beginning of the document to find out what is going on. That business was not listed in the early part of the minutes, so it was not easy to find out when the Committee was sitting.
The other problem is with reporting procedures. The Children (Scotland) Bill was recorded by Hansard but the proceedings were not printed in the daily report of Hansard. Thus those people who would normally obtain the daily record to find out what had been said the previous day in the House did not have the opportunity of reading those debates. I hope that if we have similar procedures in the future, Hansard could ensure that the daily record includes all the business of the House.
Finally, I wish to say a quick word about the suggestion that a Scottish Bill which starts in this House might be taken in a committee in Scotland. One of the difficulties with that is that, to enable everyone to be involved, it would have to be a Committee of the Whole House. Bearing in mind that proceedings would take place some distance away from the House, it would be logical to have the meeting on a day when the House was not sitting. I know that I have trespassed in terms of time. I apologise to the House for that and conclude my remarks.
8.25 p.m.
Baroness Rawlings: My Lords, this is the last evening on which we are debating the gracious Speech with which Her Majesty opened the present Session. I rise with some trepidation, having heard so many powerful speeches on economic affairs and several impressive maiden speeches. As this is approximately the 107th speech, I shall try to be brief.
I would like to concentrate on just one short sentence in the gracious Speech that was not mentioned by any of the noble Lords who spoke in reply on the first day, but which was spoken to by several noble Lords today. I hate to challenge the noble Lord, Lord Richard, who is such an experienced and witty politician. Unfortunately, he is not here but I cannot let his critical questions on the gracious Speech of our Government pass unchallenged. I quote:
"Where is the vision to inspire the nation as we approach the 21st century? Where is the declaration by the Government of their wishes for the good governance of Britain for the remainder of this decade?"
Perhaps if he had listened a little more carefully he would have heard, if I may remind him, just one short sentence:
"[My Government] … will introduce a Bill to extend choice and competition in broadcasting by providing for new digital services and easing restrictions on media ownership".
Surely, encouraging the new digital terrestrial process is really looking into the 21st century. I would agree with my noble friend Lord Astor and the noble Viscount, Lord Chandos, in supporting the Government's

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forthcoming Broadcasting Bill. This is the most exciting future piece of legislation imaginable. It is so complex that no one really knows how it will all develop, but one thing we do know is that it will involve billions and billions of pounds and will have an enormous amount of influence in the world and on all our lives.
The implications of digital technology may soon change the face of broadcasting in this country. It is estimated that we shall have at least 18 television channels with the potential of covering a range from 60 per cent. to 90 per cent. of the UK population. This is the future, the 21st century where the influence on our lives will be through the digital system and no longer the wavelengths as we know them in the analogue form.
I spent three weeks in East Anglia fighting the 1970 general election. It was impossible to receive the national popular radio station. However, some of your Lordships may remember that Radio Caroline was beaming loud and clear illegally off the coast. It fully supported the Conservative Party because we had in our manifesto that we would legalise the independent radio stations. I was convinced that we could win the Ipswich seat where I was helping, with my noble friend Lord Belstead. We did so by 13 votes. I tell this story to illustrate the power and influence that the information transmitted on those wavelengths had on the people in the area during that election campaign.
The new digital system is the great new future and a world away from when, in 1979, I fought to save the BBC World Service from cuts of £ 4 million on its £ 40 million budget. One reason why this was so vital was that we were about to attend the WARC world conference for the re-allocation of wavelengths. It was vital that we kept our share of the pie, as in those days the Soviets were pitching to get extra wavelengths via Africa which was under-allocated and could ill-afford them. That is in the past.
My noble friend Lord Carrington was Foreign Secretary at the time. Instead of having the budget cut, he succeeded in having extra money allocated. The BBC World Service now has a budget of £ 179 million. Considering all the wonderful work that it does and the enormous respect that it has all over the world, that is not extravagant. I hope that it is not in for any cuts this year.
We should not forget that the new digital system covers the wireless as well as television. With digital audio broadcasting (DAB) there will be room for at least 12 national services. That will obviously affect the present regulations, as they were based on the concept of "rare resource" within the radio spectrum. The advent of satellite and cable has dramatically changed all that in the past few years. The potential of digital will remove this "rare resource" situation. This is an area where fair legislation will be of great importance, as will a stable climate for our successful stations to continue to develop and serve the public.
Now we have a Conservative Government tackling an even greater and far more complicated advancement. We all welcome the commitment to reform the current media ownership rules. We have in Britain a media
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industry which is highly respected internationally and regularly watched and listened to abroad, with the added asset of the English language.
Across Europe, there is a patchwork of different restrictions. The single market has not succeeded here in this complex web of restrictions and regulations. In Spain, no one can own more than 25 per cent. of a television company. In France, no one can own more than 49 per cent. of a terrestrial channel. In Germany, the media are regulated by 15 regional state authorities. Yet in Italy, apparently, you can own two entire commercial channels. Denmark requires a majority of board members of private television companies to live in the area of the licence. In Belgium, at least 51 per cent. of the capital of a Flemish commercial TV licence must be owned by the publishers of Flemish language print media. Imagine the complications if we had similar laws here!
As a result, the European market prevents Europe-based companies from establishing the size necessary to compete with their US counterparts. In the US, where the same cross-media laws apply from New York to San Francisco, a media company can grow to a significant size, enabling it to be in an extra strong position to compete world-wide while taking only a small share of the total market.
The goal for policy makers should not necessarily be harmonisation across Europe. It is the global market that we should aim at, through progressive liberalisation both in Britain and throughout the European Union. Restrictions should hopefully be removed and replaced with the appropriate machinery of competition law, as was mentioned by my noble friend and learned Lord Fraser of Carmyllie.
I was delighted that my noble friend Lord Inglewood did so well at the Culture Council meeting in Brussels on Monday. He was fighting and protecting our interests on several matters; but especially relevant here is the Television Without Frontiers directive from 1989 that caused us so many problems. The Minister secured an agreement that there should be no strengthening of the current Articles 4 and 5 on quotas and that a contact committee should be established, along with a review after five years. These are sensible developments.
I am sure that the aim of the Government's new White Paper will be to help broadcasting expand, not to harm it; to strengthen it, not to weaken it; to reward it, not to punish it; to encourage it, not to threaten it; to stimulate it, not to censor it.
Finally, today's world, despite the fall of communism, is still full of turmoil and instability, with many worldwide social and economic problems. As well as the challenge of the new emerging superpowers, combined with relentless pressure on the Atlantic Alliance, the broadcasting media possess the most powerful voice in the world. They have a responsibility to uphold and protect the public interest. But what do we mean by "the public interest"—rightly mentioned by the noble Lord, Lord Donoughue? Some say that the public interest is merely what interests the public. I disagree. To me the public interest means an inescapable duty to make that voice ring with intelligence and leadership.

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In relatively few years this exciting industry has grown from a novelty into an instrument of overwhelming impact on people world-wide. Ours has been called the jet age, the atomic age, the space age. It is also the broadcasting age, with its digital future. International television is expanding so fast: today we accept easily that we receive live on our screens Pavarotti singing at a gala in New York, coverage of the dreadful war in Bosnia, or the funeral of Prime Minister Rabin in Israel. Our world has shrunk. Just as history will decide whether the leaders of today's world employed the atom to destroy the world, or to rebuild it for mankind's benefit, so will history decide whether today's broadcasters employed their powerful voice to enrich the people or to debase them.
The power of instantaneous sight and sound is without precedent in mankind's history. It is an awesome power. It has limitless capabilities for good—and for evil. And it carries awesome responsibilities. Many noble Lords will remember President Kennedy's stirring inaugural address, in which he said:
"And so, my fellow Americans: ask not what your country can do for you—ask what you can do for your country".
As we await the Government's paper announced in the gracious Speech, we might ask the Minister to reflect on the question: what can broadcasting do for our country?
8.37 p.m.
Viscount Chelmsford: My Lords, we have heard a number of references today to wealth creation, to the need to improve the country's balance of payments, and to the fact that only 3½ per cent. of UK firms are exporters. Clearly, we need to increase our living standards at this time—a time when fierce global competition will otherwise ensure that such standards fall. I wish to focus briefly on just one of the many opportunities that are available now to commerce, industry and government. I refer to the modern use of electronic networks.
Parts of our market in the UK have already successfully adopted the techniques that I am flagging. So my message is anything but revolutionary. I personally carried out my first pilot project as far back as 1973, seeking cost reductions between my own company and a leading US client. By altering simple tasks, such as who had to enter the information, when it must be entered and how long the other party had to disagree with it, we were able to cut mismatches in our respective accounts ledgers within some eight weeks, from 25 per cent. to a ½ per cent. The ensuing cost reduction that arose from that was permanent.
Electronic networks speed process between customer and supplier. Because they require users to operate in a standard way, they also bring discipline to such process. Modern technology offers two great cost-cutting and efficiency producing benefits for those who embrace it properly. The first is one that most companies have already experienced. Information technology allows them to enter once information which, when I started in the 1950s, had to be manually copied into several
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different ledgers. The primary benefits of this change are less need for clerical work, greater accuracy, and thus less need for the best employees to be used to sort out the muddle, and less need to send corrections to those involved in the trading transaction.
There was a period in the 1970s when my own company grew its profits over eight years from £ 8 million to £ 23 million, with a head count that grew by only three people overall. What were we doing? We were dropping jobs due to primary benefits from information technology and adding jobs due to growth. The two cancelled each other out. That is a marvellous position to be in, if you can do it. Yet the message is so poorly advertised that some businesses still refuse to have computers. I personally know a local GP who will not have one anywhere around his surgery. I am not getting at GPs. Happily, I know many GPs who use computers to improve their own and their patients' interests.
I now want to focus on the secondary benefits which come from the use of market networks. We all know how productive the major retail stores have become through clever use of electronic networks between themselves and their suppliers. Most of us know how bar codes on items of food both add up the cost as the shopper goes through the cash desk and advise the store on the levels of reserves available in the shop.
That ability to know the level of stocks led to two massive culture changes. First, there was the idea that stores could safely hold much less in reserve when they knew their stock levels with accuracy. Later, there was the second culture change with the determination that keeping stock levels well maintained would become the suppliers' business and not their own. The now famous just-in-time philosophy evolved to improve profits and only to improve profits.
I used that well-known example to show that networking with those with whom one trades produces a second set of benefits. Those benefits arise from the mindset change, the culture change which arises once trading by electronic network begins. Many changes are possible. It is not just the just-in-time type changes. For example, white goods manufacturers, or some of them, became so demoralised a few years ago about the inefficiency in their high street agents that they paid for and handed over to a third party organiser an electronic networking system which has since reduced waiting time for repairs, improved warranty processing and helped the shops themselves to achieve efficient internal accounts. The manufacturers who banded together and came together to do that instead of being in competition have had significant sales since then. They count the cost well worthwhile.
Incidentally, most of the shops which were concerned with that scheme fall under the Government's definition of SMEs—small and medium-sized enterprises. The Government rightly put a lot of effort into persuading SMEs to modernise.
But a major characteristic of the SME is its lack of senior people who have the time to take advantage of the opportunities that are offered. There was a recent European Commission communication on SMEs. It puts

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forward a massive six point plan which advocates an infrastructure and a cost base that I personally feel no SME will have either the time, personnel or money to support. It is said to have nation state ministerial support.
I suggest that a one point plan would have a far greater chance of SME support and that pump-priming market places to build electronic networks would be the single most effective method of growing SMEs. Electronic networks are very good news for SMEs. Few people seem to realise that. The SME joins the network because there is no other way to trade. In doing so, it receives a low cost entry into that network as the development costs have already been paid by the large company network users.
Joining the network brings a standardisation process to the SME and a discipline which few SMEs would otherwise obtain. Companies which spend less time on process have more time to spend on customer care. Companies which have re-thought how best to run their businesses using an electronic network have engaged in what is today misleadingly called business process re-engineering.
To recapitulate: information and communication technology can be used twice to improve profits—first, by improving process within the company; and, secondly, by external improvements through electronic trading. Our leading corporates already make excellent use of that. Others still need to do so. Our trade will be improved if we as a nation complete the change significantly ahead of competitor nations.
I hope that I have demonstrated from my own experience in the 1970s that the change is evolutionary and not revolutionary. I hope that it will be recognised as just one of many ways in which the United Kingdom can hope to improve profitability. It is one way, certainly, but a basic way in which everyone has to go sooner or later. There is no reason why they should not grasp the nettle now and do it sooner.
8.45 p.m.
Lord Desai: My Lords, I am perhaps the last Back-Bench speaker and, if the arithmetic of the noble Baroness, Lady Rawlings, is correct, I am the 109th speaker in this marathon debate on the gracious Speech. I shall be brief. I shall not speak on the Budget, partly because I gave my advice to the Chancellor in print in the New Statesman a fortnight ago. I am sure that by now he has read it. I shall mark his score card next Wednesday when on behalf of us all I shall have the privilege of opening the debate on the economic situation. It remains for me to talk about some of the issues which have arisen from the gracious Speech: low inflation; sound public finance; growth; and, of course, unemployment.
Without making a fetish of inflation as such, we welcome the fact that a low inflation rate has been achieved since our exit from the ERM. However, we have to remember that, while inflation is low from the point of view of British historical data—the lowest that
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we have had—it is not low compared with that of our competitors. The Bank of England's Inflation Report for November 1995 said that our inflation,
"has been higher than in the United Kingdom's major competitors. Between October 1992 and September 1995, consumer price inflation in the six largest economies excluding the United Kingdom averaged 2.4 per cent".
Ours was 2.8 per cent. Those are small differences. I do not want to make too much of them. It is clear that the low inflation we are experiencing—not just in the United Kingdom but in all the major economies—has less to do with domestic monetary or fiscal policies and more to do with the fundamental change in the supply conditions of tradable manufactured goods owing to globalisation. We must realise that what has happened is a major shift in the supply of manufactured products.
Therefore, the low inflation that we have achieved is common to all the countries and the minor differences are perhaps due to the quality of the fiscal or monetary policy. The fact that low inflation is the result of high productivity growth is a burden as well as a boon. It means that we have to maintain a high rate of productivity growth in our manufacturing. Any growth that we may achieve by higher investment inasmuch as it comes from higher productivity growth will not lead to job creation. Let us be absolutely clear. We want to achieve steady growth but it will not necessarily lead to job creation unless separate and deliberate policies are undertaken which are job creating policies.
We shall have to maintain low inflation. There is no choice. It will determine our competitiveness in world markets. Indeed, the size of our manufacturing sector can be maintained at its present level only if we continue to have productivity growth which more or less matches the rate of growth of manufacturing output. So manufacturing will not be a source of job creation—job preservation, yes; but job creation, no. Moreover, it will take a lot of investment in manufacturing to preserve the jobs we do have. Those are the imperatives of globalisation which we must remember.
I shall return to the subject of job creation in a moment. Let me first mention just one other matter; namely, the state of public finances. We have had a rather good debate about the proper size of government we should have. The noble Lords, Lord Harris of High Cross and Lord Skidelsky, debated that matter. My position is that, firstly, size does not matter so long as one balances the budget over the cycle. The first important point is the balance of the cycle. If we make a fetish of tax cuts and since we cannot reduce expenditure very much—despite all the protestations of the past 16 years, expenditure has not reduced very much—we shall have a PSBR requirement problem. There is not that infinite Laffer curve so that we go on cutting taxes and that gives us higher revenue. If we want to maintain our ratio of public expenditure to GDP at 40 per cent., we must do two things. First, there must be no frivolous tax cuts; and, secondly, we must maintain the economy at a trend rate of growth and not plunge it into recession.
As we know from our experience of the late 1980s and early 1990s, it was a boom and bust economy which brought us back to the high rate of debt to GDP ratio

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and the high PSBR from which we are presently suffering. As I have said before in this Chamber, we must not have any "feel good" factor. That is bad for us, bad for the economy, and bad for the government who try to encourage it. If we are sincere about a stable fiscal policy there must be no short-term tax cuts. Other noble Lords have already mentioned that point, so I need not labour it.
I would not hang my hat on a specific percentage of government expenditure to GDP ratio. It depends on many different factors. The noble Lord, Lord Tugendhat—I am sorry that he is not in his place—made a good speech in which he pointed out how a variety of factors (demographic, cultural and so forth) make a great difference as between countries in regard to the ratio of public expenditure to GDP. Not only that, we could easily transfer some of the financing of the health service on to an employee-employer contribution tax or a voluntary tax which would make a difference to the numbers but not necessarily to take-home pay.
Taxes may be cut publicly or privately and perhaps the noble Lord, Lord Harris, would prefer contributions to be private rather than public. However, at the end of the day it will not make much difference, in the short term, to take-home pay. If we can maintain the economy at a good trend rate of growth and not produce booms and busts, on a good day we will probably manage a 40 per cent. GDP. Even that would be good, whether or not we can actually reduce it.
As Mr. Andrew Dilnot, of the Institute of Fiscal Studies, pointed out, there has been a lot of shadow boxing this season when Ministers claim to be cutting public expenditure and doing horrible things to the spending round. But what is the truth? In real terms spending has increased every year for the past 16 years. The only time real spending was cut in the post-war period of the UK economy was when my noble friend Lord Healey was Chancellor. It was cut by 7 per cent. and was a traumatic experience. I am sorry, I should include my noble friend Lord Barnett. I apologise for not giving him proper recognition for a hard task well carried out. Apart from that, there is not much scope. As the population grows older and people demand a better quality of life, in democratic politics it must be delivered. That is obviously something we must remember.
I wish to make one more point before I sit down. I was surprised that international aspects were kept out of today's debate. I mentioned globalisation. I can only say that we must create jobs in the non-trading sectors—the public and perhaps the private sectors. They will not be easy to create but must be created because manufacturing will not provide jobs.
Surprisingly, too, nobody mentioned either the single currency or the single market. Again, I know why noble Lords opposite have a problem about mentioning Europe; but the problem of a single currency will not go away. Even if we do not join it, it will play a significant part in the British economy. The debate needs to be concerned with what the effect will be of a single currency which we do not join. If that single currency is run on the deflationary principles of the
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Bundesbank, it will have a deflationary effect on the British economy. The choice then will be a hard one; whether to depreciate our currency or tag on to a leading currency which will be mainly deflationary. Those problems will be difficult; they will not go away. However, by the same token we shall have many more opportunities to talk about them.
8.55 p.m.
Lord Harding of Petherton: My Lords, I shall interest the noble Lord, Lord Desai, by speaking on the single currency. I do not know whether or not he will agree with me. Also I should like to mention unemployment; I do not intend to connect the two.
Before we look at our relations within the European Union, we must recognise that Britain is only a medium-sized economic power today. Most British people realise that. However, sometimes encouraged by politicians and the media we seem to hark back to our position in the latter half of the 19th century when we were the leading industrial nation in the world. That leads to unrealistic expectations and faulty analysis as to what our government should be doing.
It follows from our position as a medium-sized economic nation that we must work closely with our nearest neighbours and major trading partners on the continent of Europe. In practice that means taking a full and active part as a member of the European Union. It is no good saying that we would prefer Europe to be merely a free trade area. We did not join such an organisation when we signed up for the Common Market, as it was, 20 years ago. What was political rhetoric at the time may have misled a lot of people that we did. It is true that we joined primarily for economic reasons; but the Common Market was set up before we joined mainly for political reasons. We must make the best of what the European Union now is. That means taking as full a part as possible and trying to influence its development to our own and Europe's best advantage. That is what being at the heart of Europe means to me.
However, that must not exclude our strong ties of language and culture and also of business and financial organisation with the United States. That is visible all the time in the Stock Exchange indices and the exchange rates of the two countries. More often than not the FTSE follows the Dow Jones Index and the pound sterling is very much affected by the fortunes of the dollar.
The United States still gives the lead to the world in industrial progress, invention and enterprise. We must not believe that America is finished and on a downward path; it is not true. We ignore at our peril the trade and investment ties which we have with the United States. Neither must we ignore our historical economic ties with the Commonwealth countries and those in the Far East. The Far Eastern tigers—Japan and now China—offer us the potential to use our expertise in financial management and a fast growing market for the export of our manufactured goods.
I believe that our continued membership of the European Union is vital to us economically. Not only are the other members close to us, but also a large

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proportion of our trade is done with them. That does not mean that we must slavishly follow everything that the Commission and other member countries propose, which the parties opposite appear to be inclined to do. We may have to appear isolated on some issues if that is the only way to avoid being drawn into arrangements which might be disastrous for this country.
Of course, here I refer to the debates on the single currency, the minimum wage and also the social chapter. As regards the latter two subjects I may be repeating what my noble friend Lord Astor said. I heard only a few of his remarks as I entered the Chamber, having left it for a little while.
Taking the single currency first, my right honourable friend the Prime Minister set out the difficulties and problems which have to be faced by European Union leaders in his Guildhall speech the other evening. It looks very unlikely, whatever some European Union leaders may say, that even a few countries will form a single currency in the next five years; even then, I have my doubts. However, the momentum and the rhetoric are there and a few core countries may form one in about five years' time. This core must include France otherwise the whole purpose of the European Union, as seen by France and Germany, will be nullified.
If that happens we have to think very carefully of what we would do. A scenario can be envisaged in which the United Kingdom currency would be decimated if we did not join. This would mean high rates of interest for us indefinitely. It is therefore essential that my right honourable friend the Prime Minister stands firm on not ruling out joining a single currency and keeps our options open.
As regards the minimum wage, I am utterly opposed to adopting it because of its effects on unemployment, especially among the young. The noble Lord, Lord Cooke of Islandreagh, who has direct experience of industry, made that abundantly clear in his speech. I turn to the social chapter. I recognise that large companies operating above a certain level on the Continent have to abide by the rules of having works councils etc. now and maybe other measures shortly. There is nothing that we can do about it. These companies, used to operating within other countries in Europe, can probably manage these measures without damage to themselves. Smaller companies and those who have not operated in this kind of environment, could be badly damaged. I am therefore very much against forcing all companies to do that by law. It is most important that managements consult their workers and take them into their confidence, but not by compulsion.
I now wish to talk about unemployment. I have already mentioned it in connection with the minimum wage. Unemployment in this country, as everyone agrees, is far too high although not so high as in many other countries in the European Union. I believe that the main measures to bring it down are two-fold. The first is education and training. I do not know the figures, but manual and unskilled jobs have vanished everywhere in Britain as elsewhere in the industrial countries. They are becoming fewer all the time. Most of the jobs which are
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now available and which will be required in the future, are for those people who have had a proper education. I mean by that not only people being able to read and write and add up—although there are too many who leave school without being able to do those things—but being able to write reasonable English and understand the basics of maths, science, history, geography etc. Obviously, many others will want a good deal more from education for the better jobs. We do not do too badly in educating the bright children although a great many still do not realise their full potential. It is with the not-so-bright and the dim, or merely those who could do better, but who are bored and turned off by school, that we have been so bad in the past 30 years.
I do not want to knock teachers: a great many of them do an excellent job. They need praise and not criticism. But the substantial minority who are bad must be made to leave the profession. At the moment it seems almost impossible to sack them. I may well be wrong on this, but it seems to me that the reason why a school in London has to be closed is because it is impossible to get rid of the bad teachers in any other way. I shall not talk any more about education as we are discussing industrial and economic affairs today. However, the standard of education in the country is vital to our economic performance and in order to reduce unemployment.
The second measure is to sort out our tax and benefit system, which deters people from working. The Government made a start in the right direction in the last Session of Parliament. The job seekers and the invalidity benefit measures will help, but much more needs to be done. I hope that in the coming Budget and social security announcements we shall see some progress.
I hope that I have not detained your Lordships too long at this late hour. I shall end by praising the Government who have been the subject of so much unwarranted criticism from all quarters over economic matters. As others of my noble friends have said, they have done extremely well to provide the basis for long-term, non-inflationary growth. We must build on this success to have a thriving economy, which we have at the moment, but with much lower unemployment.
9.6 p.m.
Baroness Seear: My Lords, at this time of night the last thing the House wants is a long speech from someone who is winding up. Perhaps I may start by saying how much I agree with the noble Baroness, Lady Rawlings, in her support and applause for the World Service. In previous times we have had to fight hard battles to support the grants to the World Service and it is very encouraging to know that it is thriving and is at last recognised as it should be. If other broadcasters would learn from it how to keep opinion and fact separate a great deal would be improved in the broadcasting that we get at the present time. A few seminars from representatives of the World Service would do a power of good.
I am not going to be tempted by the noble Lord, Lord Harding, to go into questions about the single market, much as I would like to, in support of what he

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said. We talk about loss of sovereignty over the single market and the single currency. We lost control of sovereignty when the noble and learned Lord, Lord Howe, got rid of all currency controls. At that moment it became possible to move money around the globe at an increasing speed. That was a bigger sacrifice of sovereignty than anything that can come from a single currency.
I should also point out what is likely to happen if we do not adopt the single currency when other countries in the European Union do. The large trading companies will use the single currency because it will be so much easier and cheaper for them to do so. They will no doubt keep pounds for home use, but will use the single currency when trading across the European Union. Once again we shall be dragged along. We shall be dragged into the single currency but without having been involved when it was first introduced and without having had any influence on it. We shall be dragged in by our own industrialists whom we think that we are supporting (in some extraordinary way) by not joining at the right time. But enough of that.
Listening to the speeches today from both Front Benches, I felt that there was a marked and distinct degree of complacency on both sides. Of course, there are things that the Government have done which the Government Front Bench naturally and justifiably want to boast about this evening. Inflation is much lower than it has been. As the noble Lord, Lord Desai, pointed out, it has fallen remarkably and, although unemployment is much too high still, it too is falling. Those are successes. Certainly, the great successes of the increase in productivity and the recovery in manufacturing industry are unquestionably gains and advantages.
However, there are an awful lot of things about which the Government have not been able to give a satisfactory account. A great many noble Lords have spoken about unemployment. I agree that unemployment here is less severe than in some European countries and that it has been falling but, as I have said, it is still far too high, and what the Government have done about it up until now does not get us very far.
We hear all the time about the lack of a feel-good factor. I am not very fond of the phrase, but that is the phrase that is used to describe the sense of uncertainty and doubt which is a very great handicap to the Government themselves. We have now reached a point when so many people do not believe good news even when they hear it.
The lack of the feel-good factor might not relate to national policy as much as one might think. The noble Earl, Lord Caithness, interestingly referred to the subject of debt. The citizens advice bureaux say that more of their cases relate to debt than to any other problem. If one considers personal debt—let alone debt at company or national level—and the degree to which it is endemic at present together with job insecurity, one realises that it is not surprising that there is not a feel-good factor. After all, the feel-good factor is primarily what you feel about your own personal circumstances. The reasons for the absence of the feel-good factor need to be examined and dealt with. It is not easy. People get into debt for a
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whole variety of reasons and job insecurity is a reflection of the turbulent changes in the labour market. They are real problems and the failure to deal with them underlies a great deal of the doubt, uncertainty and unpopularity attaching to the present Government.
We must always remember that most of the time people are not thinking about national policies, but about what will happen to their own pay packet, their ability to pay their bills and to meet their mortgage. We heard very little about that from the Government Front Bench. Very little was said to answer the questions that people raise in their own minds a great deal of the time.
When the noble Lord, Lord Peston, spoke from the Labour Front Bench I felt, as I have felt so often recently when hearing speeches from the Labour Front Bench, that the Labour Party really believed that everything would be all right if everything was as it used to be. The Opposition imply that things are wrong simply because the Tory Government have changed everything. I have a very long memory—I am a very old woman—and I do not remember that times were so very good when the Labour Party was in power—indeed not. Furthermore, I do not think that the Opposition can be complacent about the reasons for the present unemployment. If more had been done to deal with education and training when the Labour Government were in power, we would not be in the plight that we are in today. The Opposition now talk a great deal about training, but what did they do when they had the opportunity to do something about it? Very little indeed. Their one great achievement in the area of education and training was the development of the Open University and we pay them great credit for that, but for the rest they have a deplorable record.
In 1979 when the Labour Government left office, 40 per cent. of the youngsters leaving our schools went into either unemployment or a job with no training. So, the Labour Party has no real reason to think that its record is such that we would now have a high level of employment if it was in power. It has a great deal to do if it is to create the kind of society which I know that it wants to create in which people can have more highly skilled and highly paid jobs.
The phrase, "Of course, we all want to see everybody in highly paid, highly skilled jobs", is used again and again. When a great many people come out of schools unable adequately to read or add up, how on earth are we going to get them into highly paid, highly skilled jobs? I was in Scotland—yes, in Scotland with all its boasting about its educational achievements—the other day. I was told by a teacher in a secondary school there that she was getting youngsters coming from the primary schools who did not know that one had to start a sentence with a capital letter and finish it with a full stop. Given that the English language is one of our great assets—I notice the noble and learned Lord, Lord Fraser, looking deeply nationalistic at me—if in Scotland they do not know about capital letters and full stops, I am bound to ask (to make my peace with the noble and learned Lord) I wonder what happens in England.

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There is a very long way to go. The noble Lord, Lord McCarthy, spoke about small encouragements or sweeteners to get employers to take on people. I must say that the deadweight argument is a powerful one. I do not believe that that is the way in which we will get rid of unemployment. We will only get rid of unemployment when we have the training and education, and the courage and confidence for people to acquire new skills and to change and adapt as changes in the labour market require them so to do.
It is curious how little reference has been made during the debate to the whole issue of the global economy and the extent to which we are up against extremely tough competition throughout the world. The Asian rim countries are very serious competitors indeed. I quite agree that we cannot imitate them. We do not want to imitate them. They are competitors, but there are also opportunities if we can adjust our processes in this country sufficiently to meet the challenges and opportunities.
Only a fortnight ago I was at a conference in Rome. I sat next to a Chinese from Singapore. He took his engineering degree at Imperial College and his PhD at Cambridge. We seem to know all about how to provide people with the necessary equipment. He then went back to Singapore where he was training people and organising teleworking not just in Singapore but it seemed to be pretty well throughout the whole of the east Asian rim. They are moving at an enormous pace. They are catching up very fast. As we know, the average income and standard of living in Singapore are now higher than in this country. We must be there. We must be moving at that rate. There are opportunities there, but are we ready for them?
I heard nothing in the gracious Speech or in the speech from the Government Front Bench which recognised the challenges or the opportunities. It was as if we were concerned only with what went on in this country, marginally with what went on in the EU, and hardly at all with what is going on across the globe. The opportunities exist if we can prepare people properly for them, and if we can take a long-term view. All the discussions today in politics generally are based on short-term considerations. I sometimes think that the horizons stretch all the way from Wednesday evening until Monday morning in some political discussions to which I listen, and not just in your Lordships' House.
We are moving into the 21st century. It has great dangers. It has great possibilities. We need to recognise the need—everyone says that, but we are not doing it—for investment, and that means that we cannot have tax cuts if that cuts back on investment. Investment in people—yes, we all agree with that—but it is no good talking as though investment in people will give us a skilled labour force in the year after next. Investment in nursery schools today—we are all in favour of it in my party, and we want nursery schools for every three or four-year old—will not pay off for 15 years. Those three-year olds will be in their late teens before we get a pay off from that investment.
We want other investment too. We want investment in the infrastructure, and the encouragement of investment in industry itself by, as the noble Viscount,
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Lord Caldecote, said, being far more cautious about the amount we pay out in dividends and in wages. After all, we have just had the famous Ford claims. They have come along yet again. We all know that Fords have always been the leaders in pay demands. If that starts again, and if we have high dividend payments and high wage increases, our chance of meeting the challenges and seizing the opportunities offered by the global economy will go down the drain.
9.20 p.m.
Lord Richard: My Lords, I am delighted to reply to the debate. I believe that I am the 112th speaker. Perhaps I may first comment on the speech to which we have just listened. The noble Baroness, Lady Seear, attacked both Front Benches for complacency. At least the Front Benchers who opened for the Government and the Opposition spoke about economics. They did not treat us to a tour d'horizon with great elegance, which was perhaps not quite what the noble Baroness had in mind.
Secondly, the noble Baroness gave us one of her penetrating analyses of government policies during the past 30 years. It is difficult to reciprocate. We have to go back to 1911 which was the last time that a solely Liberal Government was elected. But there it is—we are used to hearing the noble Baroness, and I always enjoy listening to her.
It has been an interesting debate in many other ways, too. It has been notable for its three maiden speakers; the noble Earl, Lord Sandwich, and the noble Lords, Lord Carew and Lord Cuckney. They all made significant maiden speeches, but if I could single out one it would be that of the noble Earl, Lord Sandwich, who is not present tonight. He spoke with great experience and his was a remarkable performance for someone making his first speech in this House. I was most pleased to hear him.
The debate on the gracious Speech has ranged widely over a whole raft of Government policies. However, I have been struck by how few contributions, particularly in today's debate, have related to specific items in the gracious Speech. The reason for that is perfectly clear; it is the almost total irrelevance of much of the Speech to the real problems that face the country. Where are the policies set out in the Speech designed to bring about a fall in the unemployment figures? Where are the policies designed to increase investment in our infrastructure or our manufacturing industry? Where in the Speech is set out the Government's proposals to deal with the trading deficit? There is not a word.
On 15th November my right honourable friend the Leader of the Opposition in another place said:
"Let us look at the problems that we face. There are scandals in the privatised utilities; there is nothing in the Queen's Speech about that. One in seven 21-year-olds is unable to read properly and one in five cannot count. There is drug abuse and violent crime. One in three people is on welfare benefits under this Government. The national health service is under strain and has been turned into a two-tier system. Public transport is crumbling and pollution is rising. Does the Queen's Speech address any of those questions? It is utterly irrelevant to the problems of Britain and shows no real recognition of the state of Britain today.—[Official Report, Commons, 15/11/95; col. 14.]

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Perhaps I may add to that litany. Where is there anything in the Queen's Speech on the machinery of government; on our constitutional structures; or the relationship between Scotland, Wales and the rest of the United Kingdom? There is not a word. The gracious Speech manages even to avoid using the word "Wales", a factor which, I may tell the noble Viscount the Leader of the House, has not passed unnoticed in the Principality. The Speech was so thin that I congratulate noble Lords in keeping the debate going for four days. That was accomplished by talking about almost anything except the Speech itself. It is a trivial and openly political document, as Dr. Mawhinney revealed last week. It has all the vision of a slow worm.
Today's debate has concentrated on the economy. Naturally, from the Government—from the noble and learned Lord, Lord Fraser of Carmyllie—we were given a rosy picture of a thriving, thrusting, bustling Britain; its economy in order; its public finances under control; and the engine of the economy geared up and steamed up ready to go. A bright future is ahead of us. Would it were true.
Perhaps I may give the House one or two facts as opposed to some of the rhetoric that we have heard from the other side today. It would not be a bad idea if, from time to time, those on the Benches opposite opened their minds sufficiently to allow one or two facts to enter. In 1979, this country was thirteenth in the world prosperity league. In 1995, we are eighteenth. Since 1979, Britain's average growth rate has been 1.7 per cent. That is in 15 years of Conservative rule. That percentage is lower than that of any other country in the G7 or the European Union. Since 1979, Britain has suffered the deepest and longest recession since the war and there are still well over 2 million unemployed.
I ask Members opposite to note that there have been no fewer than 21 Conservative tax rises since the last general election. These are government figures and not mine. A typical family is now paying £ 800 per year more tax. The Chancellor has admitted that the Conservatives' tax rises are equivalent to a 7p increase in the basic rate of income tax. A typical family now pays 35.6 per cent. of its gross income to the Exchequer. In 1979, it paid 32.2 per cent. That is the legacy of 15 years of Conservative administration.
It is the unfairness of the present position which I find particularly distressing. While income tax has been reduced, particularly for the rich, VAT, indirect taxes and national insurance contributions have all risen, hitting the poor hardest. As a result, the poor now pay more tax as a percentage of their income than the rich. Again, let us look at the figures. In 1979, when this Government came to power, the poorest one-fifth of households in this country paid less tax than the richest one-fifth. The actual figures were 31 per cent. for the poor compared with 38 per cent. for the rich. By 1992, which are the most recent figures that we have, that tax burden had shifted. In 1992, the poorest one-fifth paid 39 per cent. of their income in tax compared with 34 per cent. for the richest one-fifth. I ask noble Lords
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to note those figures: in 1979, 31 per cent. paid by the poorest and 38 per cent. by the rich; in 1992, 39 per cent. paid by the poorest and 34 per cent. paid by the rich.
Whatever else the Government have achieved, they have not achieved fairness in our tax system. VAT on fuel bears four times harder on the poorest one-third of households than on the richest. Therefore, despite the seductive ways this afternoon of the noble and learned Lord, Lord Fraser of Carmyllie, all in the garden is not rosy; on the contrary, it is hardly blush pink.
However, this evening I wish to say a few words about an issue which is not mentioned in the Queen's Speech but which in my view should have been. Since the Government came to power in 1979, it is an issue on which we have had no word from them as to their views. We would have been prepared to listen and indeed to participate in any discussions on the issue. But there has been nothing; there has been silence. I refer to reform of your Lordships' House. The Chief Whip may not like it but, with great respect, constitutional issues, and in particular that issue, could and, in our view, should have been dealt with in the gracious Speech.
I become very irritated with the proposition that since this House works well, it should now be left alone. There is that absurd Americanism which one now hears so often: "If it ain't broke, don't fix it". The fact is that it is broke and it needs fixing.
Perhaps I may give the House some figures. If one looks at the composition of this House at present, there are 476 Peers who ascribe themselves as Conservative. Of those, 142 are life Peers and 334 are hereditary Peers. The Labour Party has 110 Peers, 99 of whom are life Peers and 11 of whom are hereditary Peers. The Liberal Democrats have a total of 52 Peers, of whom 29 are life Peers and 23 are hereditary Peers. The Cross-Benches have 289 Peers, 112 of whom are life Peers and 177 are hereditary Peers. The fact is that your Lordships' House functions at present in an overtly biased and unbalanced way in favour of the Conservative Party, relying as it does on the votes of the hereditary peerage.
Again, perhaps I may give the House some figures in that respect. I believe that it is important for them to be put on record. In the 15 years from 1979 to 1994—that is, the 15 years of Conservative administration—this House defeated the Government on average 10 to 12 times a year. During the last Labour Government of 1974 to 1979, the House defeated the Government on average between 70 and 80 times a year. As an example, during the Session of 1988 to 1989 the Government won 172 Divisions in this House. There were 12 government defeats and in two Divisions there was no quorum. If the votes of the hereditary Peers were excluded from that list in 1988–89, far from winning 172 Divisions, the Government would have lost 153. They would have won 20 and there would have been no quorum in 13 of them.
Therefore, while noble Lords opposite may wish to pretend that the situation is other than it is and that this House behaves with impeccable independence and judgment, I am afraid that the facts establish beyond any peradventure that this House is dominated by hereditary

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Peers who owe allegiance to the Conservative Party. I shall give your Lordships just one more figure and then I promise that I shall produce no more figures tonight.
Noble Lords: Keep going!
Lord Richard: My Lords, in the 19 years of Conservative Government between 1970 and 1994—that is, the four years of Mr. Heath's government and the 15 years between 1979 and 1994—there were in total 2,870 Divisions in the House of Lords of which the Government won 85 per cent. In the five years of Labour Government between 1974 and 1979, there were 427 Divisions in this House of which the then Government won 20 per cent. It may be coincidence, but it seems to me that those figures establish beyond doubt, first, the allegiance of the hereditary Peers on the Benches opposite; secondly, the way in which they can be used to vote in order to defeat a Labour Government; and thirdly—and, I suppose, understandably—the reason why we have heard nothing whatever about the issue in the 16 years since this Government came in in 1979.
I should point out to the House that all those figures exclude those Peers by succession who never appear. I do not quite know how many of them there are, so to speak, in the woodwork—if I may use that somewhat indelicate phrase—but the ones who are there and do not come to the House are not, I imagine, natural supporters of the Labour Party. They form a sort of static reserve which the party opposite could no doubt call upon if they so wished. I have to say to the House with all the seriousness that I can that it is not a situation which, when it comes into government, my party will be prepared to tolerate.
I am not introducing the first Queen's Speech of a future Labour government; of course, I am not. However, I believe that it would be helpful to the House to know that the abolition of the right of Peers by succession to sit and vote in this House is a measure to which an incoming Labour government is pledged. I am sorry if it offends Members opposite—although, actually, I am not too sorry—but I fear that history is about to catch up with your Lordships' House.
Had the gracious Speech had anything to say about parliamentary or constitutional reform, we would of course have listened to it with interest and participated in any discussion that there might have been. Had it had anything to say about the reform of your Lordships' House in the past 16 years, we would have listened to it and participated in any discussion that there might have been. But nothing has been said about it; there has been no discussion in the past 16 years because, very simply, the Government clearly do not want to alter a situation in which they have an enormous preferential position. The fact that that has not happened merely shows, yet again, that neither in terms of the real problems facing the British people nor in terms of making Parliament work better and being seen to work better have the Government lived up to their responsibilities. They are tired and have been there too long. It is time that they went.
9.35 p.m.
The Lord Privy Seal (Viscount Cranborne): My Lords, in spite, if I may say so, of the tone of the speech of the noble Lord, Lord Richard, this has been a most useful and interesting debate, distinguished, as so often in this place—in spite of its obvious manifest failings, as stated by the noble Lord, Lord Richard—by strong opinions underpinned by deep knowledge and experience.
I was particularly grateful to the noble Lord, Lord Jenkins of Hillhead, for his what I might perhaps term characteristically valetudinarian remarks in which he paid a generous tribute both to the Government Front Bench in this House and to your Lordships' House in general. He was also particularly polite about me. It is not, I hasten to add, mere false modesty which makes me protest as strongly as I can that he flatters me merely in order the better to damn the Government as a whole.
Rather than playing on a sticky wicket in Northampton—I am not quite clear why the noble Lord chose to make derogatory remarks about what I understand to be an admirable town in the Midlands—I was playing on a batsman's pitch at Lords. However, if I attempted to answer every point made by every noble Lord who has spoken tonight, particularly the half dozen or so expert economists from both sides of the House to whom we have listened with great pleasure, I should detain your Lordships even deeper into the watches of the night than we are at the moment. Therefore, I think the House will forgive me if I try to answer only some of the points made and content myself with answering the others by letter.
I would say to my noble friend Lord Boyd-Carpenter and indeed to the noble Lord, Lord Desai, whose speeches, as always, I listen to with the greatest of attention, interest and, if I may say so, profit, that as regards the details of next week's Budget, the noble Lords will understand, better than anyone else, that I cannot at this stage possibly comment.
My noble and learned friend Lord Fraser set out extremely clearly in his opening remarks this afternoon the thrust of the Government's economic strategy since 1979. I know that the noble Lord, Lord Peston, was pretty complimentary about this country's performance between 1964 and 1979 in what I found a most interesting speech. I hope he will not think I am being patronising in saying so. However, let us not be mealy mouthed about it. By 1979 this country, with all its proud history, had become an economic and political basket case. Those of us who love our country and want to feel proud of it—that includes every Member of your Lordships' House—and who, like myself, have spent much of their lives abroad, felt ashamed at the sniggers mention of the United Kingdom occasioned among foreigners. Those sniggers, by 1979, were richly deserved.
By then, after nearly a century of relative economic decline under governments of all political stamps, we had become a sort of demoralised Ruritania. I do not need to bore your Lordships with an analysis of how that was brought about. However, I suspect weak

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government and over mighty subjects in a corporatist and socialist consensus would loom large in any such analysis.
As my noble and learned friend Lord Fraser said in opening this debate, one cannot reverse such a decline in an afternoon. However, as he also said, in 16 years we have made more than a start. My noble and learned friend reminded us by way of example that British industry was, hardly surprisingly, more productive than German industry in the 1940s, but that by 1979—30 years later—German industry was 50 per cent. more productive than British industry. After 16½ years of Conservative government that lead has fallen to only 10 per cent. We are not there yet but we have made substantial progress. I am particularly grateful to the noble Lord, Lord Peston, for acknowledging that achievement, particularly in view of what the noble Lord, Lord Desai, said on the importance of productivity growth.
Of course my noble and learned friend was also quite right to remind us of what has happened to our country's economy both since 1979 and during the steady recovery from the recession of the past three years. I shall, with your Lordships' permission, return briefly to this later. But, if only in one sense, this evening I am perhaps a Maoist. I dwell on the past merely to serve the present but, quite rightly, it is the future that concerns the electorate today.
So we must remind ourselves of the features that will characterise the successful economies of the 21st century, and the noble Baroness, Lady Seear, did so with her usual grace and eloquence. My noble friend Lady Rawlings and my noble friend Lord Wade acknowledged that those economies will increasingly be knowledge based. As they pointed out, communications and innovation will therefore run like a golden thread through everything that they produce, both tangible and intangible. Research by producers will become increasingly important as the time gap between concept and application narrows. Labour forces will become more flexible, as will working hours, and perhaps the dividing line between work and leisure will become fuzzier.
The noble Baroness, Lady Seear, talked about the need to grasp the opportunities worldwide in order to make sure that our domestic performance improves. That is already happening. I saw a particular instance of that only yesterday when, at a particularly enjoyable occasion at my local University of Hertfordshire, I was much struck at the degree-giving ceremony by the very large number of people from the Far East and southern Europe who came to St. Albans Abbey to take their degree. I suspect that that is the kind of thing that the noble Lady was talking about in her speech this evening.
I believe that the world will reflect the developments that I have tried, all too briefly, to describe. I believe that trade protectionism will not only become undesirable but impractical. Nationalised industries will go the way of the dinosaur, killed by their inherent contradiction, the contradiction that the state cannot serve the consumer as well as the private sector can. In
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parenthesis, it does so even less well in a rapidly changing market because of its own irredeemable leaden footedness in management of that kind.
Your Lordships will be well aware that assertions of that kind are nothing new. They have become almost a cliché of today's political and economic discourse. That does not mean that they are not accurate. Indeed, I believe that they are accurate. If they are accurate they dictate the kind of policies that will yield the best chance of economic success for our nation—policies based on free trade, a low level of government interference in industry and commerce, and on individual freedom and choice.
As the noble Lord, Lord Harris, my noble friend Lord Boyd-Carpenter, and my noble friend Lord Skidelsky, in a remarkable speech, emphasised, those matters are made possible by low taxation and low government spending. I shall plead lack of time as my excuse for not indulging in a fencing match with the noble Lord, Lord Desai, on his strictures about the relative unimportance of a low level of government expenditure as a proportion of GNP.
My noble friends Lord Astor and Lord Wade added the need for deregulation. I hope that their ambitions in that regard will to some extent be satisfied, as the pace at which deregulation orders are brought forward in your Lordships' House will accelerate from now on.
I believe that if those realities dictate our economic policies, they also dictate our policies in other fields. There is one field in particular which seems to me to matter more than a little to this country. It is often claimed by those who describe so graphically the nature of this rapidly changing world of ours that one of the effects of this technologically driven world will be the demise of the nation state. I believe such predictions to be inaccurate and such an eventuality to be profoundly undesirable. While it is true that a smaller world will make frontiers more porous and international co-operation imperative, it will also give power to international organisations. In practical terms I cannot see any entity capable of controlling those organisations except the nation states that created them. Quite apart from anything else, nation states already enjoy one inestimable advantage: they already exist, and as such they are the building blocks of our present attempts to build a coherent and peaceful system of international relations.
There is also another reason why the nation state's continued healthy existence matters in a changing world. That, again, is a point on which the noble Baroness, Lady Seear, touched, but perhaps in a different context. As the noble Baroness said, times of rapid change are very unsettling. Jobs become insecure. Social organisation changes fast. Man who is, after all, a conservative beast becomes bewildered and unsure. He no longer knows where he belongs. I believe that the nation state can provide that reassurance and continuity. For that reason it is of supreme importance today at least as much as it ever has been.
The nation state matters in this changing world so long as it is characterised by two essential but paradoxical features: evolution and continuity. Noble

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Lords might consider those as Tory principles. Since 1979 we have prepared the way for this country to compete in the 21st century. I have to say to the noble Lord, Lord Barnett, that I do not think that such preparation has much to do with magic. It is more to do with hard slog and determination. The framework has been the quest for permanently low inflation, as my noble friend Lord Caithness pointed out in what I thought a most remarkable speech, sound public finances, and addressing the question of debt.
Since we set a target for underlying inflation of 1 per cent. to 4 per cent., the underlying inflation rate has averaged 2.6 per cent. That is too high, as a number of noble Lords observed; nevertheless, it is better than the 1980s when it averaged 7.5 per cent., the 1970s when it averaged 13 per cent., and indeed the 1960s when it averaged, I am told, 3.5 per cent.
Regarding public finances, we shall achieve our objective—the objective, I understand, of the noble Lord, Lord Desai—of a broad balance in the medium term. Of course we shall achieve that. But to do so we have to do more than keep close control over public expenditure although that is axiomatic in our approach. We have to break out from the sterile view that public services can be provided only by public sector finances. It is for that reason that the private finance initiative and challenge funding are so important. I believe that they will play an increasingly important part not only because they are new sources of finance but because the pedestrian sterility which so often goes with public funding for services can by that means yield to a more imaginatively provided service, more swiftly responsive to changing circumstances and so giving better service to those who need it.
The noble Lord, Lord Bruce of Donington, in a perverse way, rather helpfully pointed out the consistency of the Government's approach over the past 16 years. That stable framework, together with our supply side reforms, is actually beginning to pay dividends. My noble friend Lord Prior went so far as to say that the economy is in pretty good shape. And he, as chairman of one of our leading industrial companies, is in a good position to know.
The noble Lord, Lord Richard, asks for facts. The noble Lord, Lord Bruce, and the noble Lord, Lord Peston, rather daringly as it turned out in view of the remarks of my noble friend Lord Skidelsky, interpreted Keynes in the context of investment. I agree with what they said about the connection between investment and productivity. If they will forgive me, it seems perhaps self evident. However, I have to point out that investment is rising and that the CBI—a body much reported on today—says that investment in pensions so far this year is at the highest level for six years. I hope that the noble Lord, Lord Cooke of Islandreagh, will have noted that only yesterday we heard that manufacturing investment had risen by over 12 per cent. on a year ago and that manufacturing investment in plant and machinery had risen by over 18 per cent. Therefore I say to the noble Lord, Lord Barnett—I suspect that he is a little sceptical about historical figures—that if he wants to look at the trend I
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refer him to the London Business School which expects double digit increases of that kind to continue for the next two years.
Exports too have risen by over 24 per cent. in volume terms since the beginning of the recovery. Indeed, they have risen 6.5 per cent. in the past 12 months. I was particularly grateful to my noble friend Lord Prior for the tribute he paid to the efforts of the Foreign and Commonwealth Office in that regard. I wholly subscribe to what he said. The improvement has been extraordinarily marked and I hope that his remarks will not go unnoticed in King Charles Street.
For the first time since the early 1960s, unemployment peaked at a lower level in the last recession than in the one that preceded it. The noble Lord, Lord McCarthy, accused the Government of not talking about unemployment. I hope that I shall be able to make up for the deficiency in a small way this evening. I have to say to him that the same is true of long-term unemployment as short-term unemployment. Our unemployment rate is now well below the European Union average. Indeed, in the last cycle over 2 million jobs were created, twice the rate of France and Italy. At present, for the first time for decades, the United Kingdom enjoys not only a higher percentage of its population in work than it has traditionally enjoyed, compared with our European neighbours, but also a lower rate of unemployment than Germany itself. Nevertheless, as the noble Baroness, Lady Seear, said, unemployment is still too high, We all agree with that. I merely contend that we are going about reducing it in the right way.
With all that—our increasingly well educated workforce and our by now magnificent industrial relations record—is it surprising that we attract more inward investment from the USA and Japan than France and Germany combined? Or that we have grown substantially faster than the G7 average over the past two years? The noble Lord, Lord Barnett, accused us of growing more slowly than countries with high spending governments. After all, as a former Chief Secretary he is better able than I am to diagnose figures. However, since 1981 we have grown faster than Italy, France and Germany.
We are doing many other things. We are running a balance of payments surplus with Asia as a whole, including a surplus with the much-vaunted newly industrialised Asian tigers. The noble Lord, Lord Richard, asked for facts; that is a cross-section. Since we are talking about the noble Lord, I must confess to some puzzlement when I contemplate his party's reaction to all this evidence. On the one hand they seem to say—or at least it is what they mean—as the noble Lord, Lord Harris of High Cross, pointed out, that Tory policies work. Mr. Gordon Brown and Mr. Blair—unlike the noble Lord, Lord Bruce of Donington, whom I exempt from this stricture—seem now to accept that low taxes are desirable, that 10 per cent. is a desirable goal. They—if not their supporters, and I suspect certainly not the noble Lord, Lord Bruce—seem not to want even to tax the rich very highly. They seem at last also to accept that the state should spend a lower proportion of the national output and they seem to

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recognise the importance of the private sector. Superficially they seem to accept that Toryism as a whole makes an economy work. They have even accepted the importance of using the welfare system to encourage the unemployed into work. Unlike a number of noble Lords, what they do not appear to have noticed is that the jobseeker's allowance, which they opposed, is designed to do just that.
The trouble is that they do not quite understand why Toryism works. They may approve of lower taxes in the private sector—or at least some seem to. But they still wish to introduce policies that will raise taxes and kill private enterprise. They do not understand that competition produces competitiveness.
There are a number of examples which I could give and I shall not weary the House at this late hour with examples of nationalisation. However, I wish to draw the Opposition's attention to two matters: the social chapter and the minimum wage. I could not help noticing that at the CBI conference the leader of the Labour Party in another place made the following rather remarkable statement:
"The social chapter is not detailed legislation. It is a set of principles. The real fear is that by being part of it we may in future agree to the import of inefficient practices to Britain. A Labour Government will not pursue such a course. Each piece of legislation will be judged on its merits. I have no intention whatever of agreeing to anything and everything that emerges from the European Union".
I call that statement remarkable for that is what it is. It is remarkable for the apparent ignorance, which I am sure is not genuine, that it displays of the nature of the social chapter and Mr. Blair's contention that some of its provisions would, if adopted, "import inefficient practices into Britain".
I am sure Mr. Blair realises that he cannot, as he implied to the CBI, shop à la carte once he has signed up to the social chapter. Whether or not he is concerned about the works council directive, parental leave, part-time and temporary workers, he would have to subject himself to QMV. It is true of course that unanimity is required in certain areas, but they are very clearly specified, as the noble Lord, Lord Richard, with his greater European experience, will know.
What makes this even more extraordinary is that Mr. Blair, not content with explaining his wish to the CBI to veto those parts of the social chapter legislation of which he disapproves even though he may not be able to do so, said to this year's TUC Conference,
"We will become part of the European chapter".
He certainly failed to qualify that undertaking to that audience.
What makes the case of Mr. Blair and the social chapter even more curious is that, at the same time, he calls for an extension of QMV—at least, he did so in Bonn on 30th May this year, when he called for its extension,
"in the area of social, environmental, industrial and regional policy.".
Perhaps Ms Diane Abbott knew what she was talking about when she told the "Today" programme on Monday:
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"Labour can say anything it likes so long as it gets elected".
What about the minimum wage? The Labour Party are apparently all in favour of it. They carefully do not say how much it will be. Perhaps that is because they know that it will cost jobs, particularly among those whom they, and we, want to encourage into work; namely, the young unemployed. Under pressure, Mr. Dewar admitted as much in another place on 10th July this year, as did both his Leader and deputy leader. Mr. Blair tried to hide it in what I can only call Ed Ball speak, when he told the Independent on 27th June 1991:
"Econometric models indicate a potential job impact".
Mr. Prescott was perhaps typically rather more forthright to Mr. Brian Walden on 24th May 1992 when he said:
"I knew the consequences were that there'd be some shake-out. Any silly fool knew that".
If any silly fool knew that a minimum wage would cost jobs, what should one call someone who, knowing that, still wished to introduce one?
The truth is that the social chapter has been tried in continental Europe, which does not enjoy the Tory negotiated opt-outs to which the noble Lord, Lord Cooke, referred. And what are the results? Our current rate of youth unemployment is less than half that of France and Spain, two countries which are signed up to both the social chapter and the minimum wage. The Labour Party may be long on rhetoric, but in the end it is perfectly clear that, when it comes to the detail, the Labour Party cannot be relied on to get it right.
Nowhere is that more apparent than in what the Labour Party propose for our nation state. I have already explained to the House why I feel that in the modern world nation states are important. The Labour Party pays lip-service to our country while advocating policies that will undermine its ability to protect its citizens and constitutional reform that will destroy the Union. By advocating a massive extension of QMV, they are undermining the Europe of nations which should be our goal and advocating a Europe that might have been attractive to the intellectual fashions of the 1960s. They are doing so at a time when, as the proceedings of the Majorca unofficial summit showed a few weeks ago, our European partners are beginning to see the force of our point of view and are moving away from some of their more corporatist stances. If noble Lords will perhaps forgive me for a brief reference to my own family history, this extraordinary procedure on the part of the Opposition reminds me of nothing so much as an ancestor of mine who became a Roman Catholic on the eve of the 1688 revolution.
In view of all this, I can therefore readily understand why the noble Lord, Lord Richard, preferred to talk about the reform of this House rather than the economy. In his place perhaps I might have taken refuge in the sort of rhetoric that he chose this evening.
The noble Lord was also understandably reticent about his own party's policies. He did not say very much about them at all. He and the noble Lord, Lord Jenkins of Hillhead, concentrated their fire on the Government and this Session's legislative programme.

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Both he and the noble Viscount Lord Chandos, called the programme "thin" and used a number of other words which carry the same meaning. I noted that the noble Lord, Lord Donoughue, in his extremely useful views on the Broadcasting Bill, hardly squared with that view. Indeed, I must say that I too, rather like the noble Lord, Lord Donoughue, and indeed my noble friend Lady Rawlings, find it hard to agree with the noble Lord, Lord Richard.
Suffice it to say that many of the Bills will prove controversial in your Lordships' House, even though the Government consider them to be necessary. If the programme is as thin as all that, let us see whether the noble Lord, Lord Richard, is as right in his diagnosis as he turned out to be in making a similar diagnosis at this same moment last year. The fact is that the programme announced in the gracious Speech continues the supply side reforms of the past 16 years. They were ignored by the noble Lord, Lord Barnett, during the course of his speech but they were well exemplified by my noble friend Lord Astor when he too pointed out the importance of the Broadcasting Bill. Those reforms have had an objective, which is to increase the prosperity of our country. Together with the rest of the programme, they will increase the cohesion and security of our society, about which all sides of the House are increasingly worried.
In short, I believe that the programme brings closer to achievement the twin objectives of this Government: prosperity for the 21st century and stability for the nation. I commend the programme to the House and look forward to debating it in the months to come.
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On Question, Motion agreed to nemine dissentiente: the said Address to be presented to Her Majesty by the Lords with White Staves.

King's College London Bill [H.L.]
The Chairman of Committees acquainted the House that, pursuant to the Resolution of 26th October last, the Bill had been deposited in the Private Bill Office together with the declaration of the agent; the Bill was presented, read a first time, read a second time pro forma, and reported from the Unopposed Bill Committee.
London Local Authorities Bill [H.L.]
The Chairman of Committees acquainted the House that, pursuant to the Resolution of 26th October last, the Bill had been deposited in the Private Bill Office together with the declaration of the agent; the Bill was presented, read a first time, read a second time pro forma and committed to a Select Committee.

Bodmin Moor Commons Bill [H.L.]
The Chairman of Committees acquainted the House that, pursuant to the Resolution of 26th October last, the Bill had been deposited in the Private Bill Office together with the declaration of the agent; the Bill was presented, read a first time, read a second time pro forma and reported from the Select Committee, and recommitted to an Unopposed Bill Committee.
House adjourned at one minute past ten o'clock.

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