Sitting of 29 November 1995

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

Famagusta
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Streeter.]
9.34 am
Mr. Tom Cox: I should like to thank you, Madam Speaker, for granting this debate, which will be followed with interest in this country and certainly in Cyprus. The elected mayor of Famagusta has travelled from Cyprus to listen to the debate and is in the Strangers Gallery. I extend a warm welcome to him. I should like to declare my interest. I am the chair of the Cyprus group of the Commonwealth Parliamentary Association. My hon. Friend the Member for Mansfield (Mr. Meale) and the hon. Members for Edmonton (Dr. Twinn) and for Eastbourne (Mr. Waterson) are the other officers of the group. Many hon. Members from all parts of the House are on the all-party Cyprus group.
Cyprus has a long historical relationship with the United Kingdom. It is a member of the Commonwealth and the UK is one of the guarantor powers for the island. The country is known and loved by many millions of British people who have visited it over many years. It is most certainly not some faraway country with which we have no links or know little about. Many of us know that President Clerides served with great distinction in the Royal Air Force during the last war, and that many Cypriot men and women bravely fought alongside members of our armed forces.
In 1974, the Turkish army brutally invaded Cyprus. That led to the division of the island and 21 years later it is still occupied and divided. Over the years there have been many discussions that I and many hon. Members had hoped would lead to an honourable settlement under which the rights of both Greek and Turkish Cypriots—I stress, both Greek and Turkish Cypriots—would have been respected and protected. Sadly and tragically, nothing has happened over the past 21 years to bring about a settlement. That is why I sought this debate.
In seeking to overcome problems one has to make a start and over many years Famagusta has been given as the example of where that start could be made. Since the 1974 invasion it has been a ghost town. No one lives there and no business is conducted in the town, yet before 1974 it was one of the most popular areas in Cyprus because it had beautiful beaches and hotels and a thriving business community lived and worked there. All that could return, and it would benefit the people who would live there—the Greek and true Turkish Cypriots whom I wish to see once again becoming the inhabitants of Famagusta.
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I have said that Famagusta could provide the start for a settlement and I should like to repeat some of the comments that have been made over the years. In November 1978, just four years after the invasion, a joint British, Canadian and American group produced a document entitled, "Framework for a Solution of the Cyprus Problem". It proposed the immediate resettlement of Famagusta. Paragraph 12 of the document states:
"In order to promote an atmosphere of goodwill and to resolve pressing humanitarian problems, the … (Famagusta) area shall be resettled under UN auspices in accordance with the attached agreements. Such resettlement shall be initiated in phase with the resumption of full intercommunal negotiations on a comprehensive agreement".
In his 1978 report, the then Secretary-General of the United Nations said:
"The time may now be ripe for a concrete attempt to deal with some important aspects of the existing stalemate on the ground, thus creating an opening for further significant steps.
The status of Famagusta which obviously should not be kept in its present empty and decaying condition, may provide an opportunity of the kind. Since Famagusta is situated in the immediate vicinity of the buffer zone and is patrolled by UNFICYP troops, it would be seem natural to envisage United Nations assistance in this connection".
There was a high-level agreement between the then President of the Republic of Cyprus, Mr. Kyprianou, and the leader of the Turkish Cypriots, Mr. Denktash. It said:
"Priority will be given to reaching agreement on the resettlement of Famagusta under UN auspices simultaneously with the beginning of the consideration by the interlocutors of the constitutional and territorial aspects of a comprehensive settlement. After agreement on Famagusta has been reached it will be implemented without awaiting the outcome of the discussion on other aspects of the Cyprus problem".
That agreement between President Kyprianou and Mr. Denktash was signed on 19 May 1979. Despite all those talks and agreements, nothing has happened.
United Nations Security Council resolution 550 was passed on 11 May 1984. It says that it
"considers attempts to settle any part of Famagusta by people other than its inhabitants as inadmissible and calls for the transfer of this area to the administration of the United Nations".
That is why I said earlier that I and our friends on the Conservative Benches want both Turkish and Greek Cypriots living once again in Famagusta. Regrettably, however, nothing happened in the six years after the framework document to which I referred was agreed and recommended in November 1978.
We now reach May 1993 and the report of the Secretary-General of the United Nations, who proposed
"a package of confidence-building measures as a first step towards an overall settlement. A key issue in the set of proposals was the opening up of the fenced area of Famagusta to resettlement by its original inhabitants. The area would be placed under UN administration and the owners of property there could obtain possession of their assets. Both Greek Cypriots and Turkish Cypriots would be able to enter the area freely and intercommunal contact and trade would he encouraged. The proposal was accepted by the Greek Cypriot side from the outset but the Turkish Cypriot side failed to give a positive response."
On 4 April 1994, the Secretary-General reported to the Security Council that
"the Turkish Cypriot side had not provided the response necessary to make an agreement on the implementation of the confidence-building measures possible".

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So again, sadly, nothing happened, but the Secretary-General clearly stated who had stopped the progress that we had all been looking for.
In his report to the Security Council on 11 April 1994, the Secretary-General underlined
"the need to conclude an agreement on the implementation of the confidence-building measures".
Against that background and all the recorded facts, can there be any doubt who has stopped the progress that could and should have been made? Is the Minister of State, Foreign and Commonwealth Office in any doubt? Are the British Government in any doubt? The UN and the Republic of Cyprus clearly support and work for the reopening of Famagusta.
What role does Famagusta play today in the life of Cyprus? None whatever. As I have said, it is a ghost town. Nothing is sadder or more distressing than to go into that region of Cyprus, to stand on high buildings, to look into Famagusta, as I have, and to be with Greek Cypriots who say, "That used to be my home, that used to be where I worked." Twenty-one years after the invasion of Cyprus, that is still the tragic position: Famagusta is a ghost town.
Are the British Government, one of the guarantor powers, happy with that? If not, what are they doing to promote the reopening of Famagusta? I and many other Members of Parliament want there to be meaningful involvement by the British Government. They cannot say, "Oh, we have no role to play," or, "There is too much opposition to this proposal." The only opposition is from Mr. Denktash, but again, as with everything concerning a possible honourable settlement in Cyprus, there is always opposition from Mr. Denktash. The views of the UN, of the United States Congress, of the European Parliament and of the Council of Europe are all on record. They all say the same thing: it is Mr. Denktash and his supporters in Turkey who stopped the progress that we want.
I talk, hon. Members talk and, most certainly, the Republic of Cyprus and the UN talk of the full return of Famagusta to its position before the 1974 invasion. The Minister and his officials must not waste their time talking about a gradual return, some of the town being returned and some of it still remaining under the control of Mr. Denktash. That suggestion is totally unacceptable to hon. Members and to the Republic of Cyprus. So I beg the Minister not to waste his time with such suggestions.
We seek, as the United Nations has sought, the full return of the town of Famagusta to the people to whom it belongs—Greek and Turkish Cypriots. With that return must come the full withdrawal from the town and the area of the Turkish army, its place being taken by United Nations peacekeeping forces.
The case for the return has long been made, and we must ask the Minister why it has not happened. I am sure that the House would like to hear his views. For years, when Cyprus has been discussed in the House, the Government, who have been in power for 16 years, have always made the same statement: "Of course we want a settlement, and we fully support the efforts of the United Nations."
Many of us reply, "Good, but what are you doing to create an initiative leading to discussions and to a settlement for Cyprus and its people?" When has an
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initiative, any initiative, come from the Government over the past 16 years? It is now 21 years since the invasion, and for 16 of those years the Government have been in power. What can they say now to show their own initiative on Cyprus?
I have here a concurrent resolution published by the United States Congress on 16 March 1995, called, "Supporting a resolution to the long-standing dispute regarding Cyprus". No doubt the Minister has seen it. I could quote at length from that document, but one sentence says it all:
"President Clinton appointed a Special Presidential Emissary for Cyprus".
President Clinton and the United States Congress are now to take an active role on the Cyprus issue. What will be the Government's response? Do they welcome that or will they obstruct it? What is their view? I hope that the hon. Gentleman will tell us.
We all know about Turkey's role in Cyprus. Last week Mrs. Ciller, the Prime Minister of Turkey, was in London and met our Prime Minister. She can offer nothing to help him in our coming general election, but we all know what she wanted—this country's support for Turkey's application to join the European customs union, and in her forthcoming election campaign.
We all know how high-level politics are conducted; there are trade-offs. So my question to the Minister is: what did Mrs. Ciller offer? Did she commit Turkey to work genuinely now for an honourable settlement in Cyprus? And what did the Prime Minister ask her to do? I hope that the Minister will tell us.
At the beginning of my speech I mentioned Cyprus and membership of the Commonwealth, and a statement on Cyprus was made at the recent Commonwealth Heads of Government meeting in New Zealand. It gave total support to the United Nations resolutions on Cyprus—resolution 365, passed in 1974, resolution 550, passed in 1984, and resolution 939, passed in 1994. The Heads of Government also called for the
"withdrawal of all Turkish forces and settlers from … Cyprus, the return of the refugees to their homes"—
a statement that was fully endorsed by the conference.
The Commonwealth, the United States Congress and the United Nations all say the same thing. So when shall we at long last start to see commitment and support from the Government for those statements? If the Government support them, there can be no other issue, as I have tried to outline by detailing what successive Secretaries-General of the United Nations have said.
The reopening of the town of Famagusta would start off the actions and policies that would lead to the end of the division that, tragically, still exists in Cyprus, and to the end of the long suffering of both communities, Greek and Turkish. The challenge now is for the Government. What will they do now to back up the attempts that have been made, especially with regard to reopening Famagusta?
9.55 am
Dr. Ian Twinn: I congratulate the hon. Member for Tooting (Mr. Cox) on obtaining the debate, and thank you, Madam Speaker, for granting it. A debate on Famagusta and its occupation for 21 years by Turkish troops is long overdue. But before I make my speech I declare an interest, in that my family and I were the guests

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of the town council and the mayor of Famagusta for three days in the summer—although, sadly, we could not reach Famagusta itself.
Famagusta was the third largest city in Cyprus, with 60,000 people in its municipal area. Those people are now refugees—some living in other parts of Cyprus, some in my constituency in north London, some in Australia and some in the United States. They are spread around the world, and they have not been back to their homes.
I have not been to Famagusta itself, but like the hon. Member for Tooting I have stood at the barbed wire, looked down into the town and talked to the United Nations troops who keep us out. I have seen the Turkish troop emplacements keeping watch on us as we look down at the ghost town of Varosha, a suburb of Famagusta that was cynically fenced off by the Turks so that it could not be occupied.
Varosha now stands crumbling and overgrown; in people's homes the curtains blow in the wind and their goods—washing machines, televisions and other personal possessions—have been looted by Turkish troops. Family photographs still stand there in place.
I am sure that no hon. Member who meets refugees from anywhere in the world can fail to be moved by their personal circumstances, but Greek Cypriots can go to the dividing line, the green line, today and see their homes, their gardens and their fruit trees—but they cannot get to them. At the same time they know that their possessions are not being used by anyone else, but are being wasted in the most cynical way by the Turkish Cypriot administration that has taken possession of more than one third of the island of Cyprus.
That administration is unrecognised by anyone other than Turkey, which has tens of thousands of troops ensuring that it keeps possession of that part of the island. As many as 80,000 settlers have also been brought in from Turkey, in a mass movement of population unprecedented in 20th century Europe. The House should state firmly its total opposition to what has happened in Cyprus over the past 21 years.
The story of Famagusta is the story of Cyprus, and the House cannot discuss the town separately from the issue of what has happened in the whole of Cyprus. The future of Famagusta depends on the future of negotiations and on reaching a settlement which will allow Turkish and Greek Cypriots to live together in peace on their island. It is their island; it does not belong to the 80,000 settlers or to the 40,000 troops. It belongs to Cypriots.
As an officer of the Cyprus committee of the Commonwealth Parliamentary Association, along with the hon. Member for Tooting, I feel very strongly that I am here to argue for the interests of all Cypriots—not for Greek Cypriots and not for Turkish Cypriots. There is a balance to be achieved. Both communities in Cyprus have every right to expect to live their lives in peace and be able to go to their home areas, to enjoy their own property, whether they are Turkish Cypriots who cannot get down to Paphos where their land was, or Greek Cypriots who cannot get to Famagusta, Kyrenia or Morphou. None such restriction is acceptable. We have a duty to continue trying to achieve a solution in Cyprus which allows all Cypriots to enjoy their own island.
The history of the past 21 years in Cyprus is littered with messages of good will from politicians from around the world. We have already heard that it is littered with
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UN resolutions. The UN resolutions cannot be objected to; they are wonderful and say exactly what we want to achieve. Yet 21 years on, we have achieved none of it.
Declarations of good will are not enough by themselves. Varosha is still a ghost town. The hotels along the beautiful Famagusta sea front are empty, and when people try to see them, even from the sea, Turkish gunboats appear to turn back local residents. The same is true of Morphou at the other end of the island. It is totally inaccessible to the people to whom it belongs. The same is true of Kyrenia since people fled from the original invasion, never to return and see their homes. We must ask our Government to do everything that they can in the world community to ensure that the Turkish troops and the settlers leave, and that Cyprus is returned to the people to whom it belongs.
None of that of course will be easy—we know that. We can go into great detail about the nature of the 1960s constitution, why it broke down and how the two communities failed to work together. But whatever conclusions we reach, wherever we want to apportion blame, some of the blame has to come back to Britain. We have a strong responsibility in Cyprus. We helped to construct the constitution. We have been close advisers in the post-independence era. We have a duty as one of the three guarantor powers of Cyprus to ensure that it is returned to democratic health and that Turkish and Greek Cypriots are able to enjoy their own land.
So we cannot stand back as a country, whatever some British people say they want. We cannot cynically stand back and allow Cyprus to carry on in the way that it has. Cyprus is divided; it is the only European country divided by barbed wire where troops keep two parts of the same population apart. The capital city of Nicosia is divided. It is a beautiful and wonderful city, and I have been privileged to see both sides of it in recent years. Indeed, I have seen both sides of the same street which had a derelict area in the middle. That is a heart-rending experience for anyone.
One day, I am absolutely sure that the nightmare of Cyprus will end. It is not a question whether Cyprus will remain divided for ever. That will not happen and those people who believe that an acceptable solution has been found in the division of Cyprus—we have heard such sentiments expressed from both sides of the House in the past—are deluding themselves. The interests between Greek and Turkish Cypriots are so strong, the island so small and the economic necessity of getting together so significant, that one day there will he a solution. Therefore, we must turn our minds to what can be done to bring the two communities together.
It is not right for us as foreign politicians in Cyprus to dictate the solution. The days of Britain doing that around the world are over—perhaps that is rather a good thing. We can, however, stand behind both communities and give them the reassurances that they need and ensure that any solution will be fair.
My involvement in Cyprus is very much concerned with helping in any way that I can to bring the two sides together and ensure that a solution becomes possible. I certainly do not accept Turkey's pre-eminent role in that region as being a barrier to a solution in Cyprus. I am afraid that too many people accept that the power which Turkey represents is too important to cross in a region where we look for stability. The occupation of Cyprus by troops is not legitimised by Turkey's obvious power.

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While supporting both sides in efforts to get together for talks to try to reach conclusions on what a solution may be, we have at times all been guilty of encouraging the legitimate Government of Cyprus to make concessions, which have been readily accepted as a fact by the Turkish Cypriot Administration. But nothing reciprocal has followed and negotiations have broken down. In subsequent negotiations, the Government's concessions have been taken on board and more has been demanded. There has been a ratchet effect, which we saw with the confidence-building measures and the suggestion that one eighth of Famagusta—the fenced Varosha area—should be made over to some sort of free town.
That was a good idea if it was to be based on moving forward to a solution for the whole of Cyprus. Many of us thought that if that area was just to stand alone as a small gesture, it was not worth having. I am afraid that we are in a such a position now. It is very difficult to imagine anyone putting their money into redeveloping the small, fenced area of Varosha, which would be surrounded by Turkish troops and have inadequate safe access for Greek Cypriots. It has been empty for 21 years, shrubs and trees grow in the roads, buildings are crumbling, and it would cost a lot of money and several years' work to make it inhabitable again.
I would like Famagusta—a much larger area than Varosha—made over as a free town. I would like it to become an economic free zone. It has a tremendous future. That change could happen regardless of whether it would lead to an immediate solution within Cyprus, provided that it was administered by the United Nations as a UN town where there was equal access for both communities.
I speak purely in a personal capacity. As someone who believes passionately in the operations of the free market, perhaps the House will forgive me for thinking that it is a jolly good chance to demonstrate that the free market can bring together people of two communities. Such a move cannot happen with just Varosha because it is too small and insecure for people to commit their capital to it. But that is not what we should be arguing about today. We should be arguing about achieving a solution in Cyprus, not only Famagusta. I do not want Famagusta to be traded off to allow the rest of the northern part of Cyprus to remain occupied—that is not acceptable.
I have been impressed over the years by the position taken by my right hon. and hon. Friends in the Government, who have readily understood that Britain has a moral duty in Cyprus and that the status quo in Cyprus is not acceptable. That has to be countered by the fact that we are not a power which can tell the Turks, with the use of military might, to go back where they came from. We have to work in co-operation with our European Union partners and I am glad that we are.
I am also pleased that a firm commitment has been made to begin negotiations six months after the intergovernmental conference, and that Cyprus can look forward to joining the European Union whether or not the Turkish Cypriots want to join. I would much rather the Turkish Cypriots were part of it. None the less, no one can be allowed to blackmail processes surrounding Cyprus's entry into the EU.
I am also encouraged by the fact that the Americans are now turning their minds to what happened in 1974. Given that, and with the President of the United States of
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America here today, he might like to consider America's part in the events of 1974. With the Congress now thinking positively and in a quite unified way about the future of Cyprus, and with the President putting some energy into the issues in Cyprus, perhaps the President will talk to his Secretary of Defence about the influence that the American defence institutions have on the Turkish military. If the President commits himself to that, it will be the most positive thing that he could do to achieve a settlement in Cyprus.
I shall certainly continue to work hard to ensure that we have a solution. The solution, however, must be just and fair for all Cypriots.
10.9 am
Mrs. Barbara Roche: I congratulate my hon. Friend the Member for Tooting (Mr. Cox) on his success in obtaining today's debate. He is well known among hon. Members for his commitment to Cyprus and for having brought the situation there to the attention of the House over many years.
I had the great honour and privilege—I declare an interest—to be a weekend guest at the Morphou municipality's rally in October. The municipality is operating in exile because Morphou, like Famagusta, cannot be visited by Greek Cypriots. People whose roots were there for generation after generation cannot visit their homes. They are prohibited from visiting the graves of their fathers, grandmothers and grandfathers, and they cannot tend the orange groves that have been in their families for generations.
It is appropriate that today—21 years after that terrible invasion and occupation of 1974—we are debating the reality of life in Famagusta. What was once a prosperous and thriving place with an extremely successful tourist industry is now a ghost town. For the many tourists who visit Cyprus each year, it must be absolutely inconceivable that there is a part of this beautiful and successful island where nothing moves and where people have given way to rats.
We must examine the overall situation in Cyprus. Twenty-one years after the invasion, many people are still refugees in their own country. There are, of course, no refugee camps in Cyprus because the Republic of Cyprus has absorbed its refugees. They are very successful members of society who play their full part in the political, economic and social fabric of their country. As far as the international community is concerned, that has almost played down the urgency of finding a solution for the problem.
Cyprus is a small country—a small island. It is a member of the United Nations, a member of the Commonwealth and an independent country occupied by a foreign power. At the last count, there were about 400 tanks on that small island, which is an obscenity. That is not right, and it cannot be tolerated.
In the illegally occupied far north of the island there is the scandal of the enclaved people, whose human rights are violated daily. That has been catalogued by the United Nations. There is also the scandal of the missing people. Many families in my constituency—I know that I always say this, but it bears repeating—do not know what has happened to their missing relatives. The time for this debate is short, and I do not want to take up the time of

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other hon. Members who wish to speak, but in his reply on the future of Famagusta I should like the Minister to concentrate on those missing people.
What will be Britain's role in finding a solution? Britain is a guarantor power and has a very special relationship with Cyprus. In the past 10 years, however, Ministers have paid very few, if any, visits to examine the situation in Cyprus rather than consider the Government's defence role. Will that record change? It is important that Turkey and the illegal regime of Mr. Denktash do not have any veto on Cyprus's application to join the European Union. Some of the Prime Minister's remarks do not fit well with that aim. I should like to hear the Minister give a clear assurance that there will be no veto, nor a de facto veto.
It is important when we debate the situation in Cyprus that we do not merely say that we will support the best endeavours of the United Nations, although those are vital. Britain's importance in the region calls for something more, and we can play a unique role in negotiations with our American partners. In our language, we must not fall into the trap of talking about the situation in Cyprus as if it is some sort of intercommunal dispute between two parties, because it is not. It is a dispute between the sovereign, independent Republic of Cyprus and an illegal regime backed by a foreign occupying power. Our language must be correct.
If we take those actions, I am sure that we will find a just solution for the beautiful places that once were and can again be Famagusta and the island of Cyprus.
10.17 am
Mr. Edward O'Hara: I, too, congratulate my hon. Friend the Member for Tooting (Mr. Cox) on securing this important debate. It is a well-timed debate because tomorrow is St. Andrew's day. St. Andrew is closely associated with the town of Famagusta, and there is great affection among the people of Famagusta for the monastery of Apostolos Andreas, far up in the north-east of the enclaved Karpa peninsula. It may behove the House today to remember the plight of the people who are trapped in that enclave.
Andrew is also the name of Mr. Pouyouros, the mayor of Famagusta, whom we welcome to London today and whose name day is tomorrow. It is therefore particularly appropriate that we have this debate today. I declare an interest. I was briefly the guest of the municipality of Famagusta and that of Morphou at the demonstrations earlier this summer, and I was proud to be able to support the demonstrations against the injustice of the present occupation of northern Cyprus.
I should like to explain the terms Famagusta and Varosha, because there is some confusion about them. Early-day motion 110 deliberately refers to Famagusta-Varosha. Famagusta in Greek is Ammochostos, which means "town covered with sand". That shows the long history of occupation of this site, which goes back more than 30 centuries to the iron-age settlement of Enkomi, through the classical settlement of Salamis—associated with Homeric heroes in ancient history—to the Byzantine era, when the name Ammochostos first appeared.
Famagusta was the name bestowed on the town during the Venetian occupation. It was then one of the biggest harbours and trade centres in the eastern Mediterranean 239912 T
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and Othello's tower, which was built into the massive walls of old Famagusta, was the inspiration for Shakespeare's play. When the town was conquered by the Ottoman Turks in 1571, the Greek inhabitants were ejected from the walled city of Famagusta, but they did not leave the area and settled in the suburbs. "Varosh" is the Turkish word for suburb, so Varosha refers to the suburbs of Famagusta.
In modern times, Famagusta has two meanings. The name refers to the old walled town of Famagusta, which dates back to medieval times, and to the walled town and suburbs of Varosha. Famagusta can mean both, and it is important to have that clarified on the record. The British occupied the town in 1878, and I shall mention that again in my concluding remarks.
In the course of its history, Famagusta became one of the jewels in the economy—if not the greatest jewel—of Cyprus. It was not only an important trading centre, but—in more modern times—an important tourist and holiday centre. Golden Sands beach in Famagusta bay is one of the finest beaches in the Mediterranean. The tourist industry was inhibited by the EOKA troubles in the 1950s, but after the independence of Cyprus in 1960 the tourist industry of Famagusta really took off.
In 1974, on the eve of the Turkish invasion, Famagusta was a flourishing economic and cultural centre, and we should remember that a high level of culture had developed there. It is important to note that Famagusta was not overrun in the first invasion of northern Cyprus in July 1974, after which the Turkish army should have withdrawn under the treaty of guarantee. Under that treaty, the Turkish army had the right to intervene to facilitate the restoration of the status quo. When the coup d'état was overthrown in 1974 and the legitimate Government reinstalled, the writ of the Turkish invading forces expired and they should have withdrawn. But they did not, and on 14 August 1974 they launched a second invasion and Famagusta was overrun on 16 August.
It was obvious that the Turkish tanks were overrunning the fertile Mesaoria agricultural plain, and they also took the high and low roads between Famagusta and Nicosia—two of the most important roads on the island. When the Turkish army occupied Famagusta, it expelled the Greek inhabitants. There was a tragic exodus of refugees, and the town was fenced off. The town was not resettled, and Famagusta is almost unique in this sense. It became a ghost town—a term that has been used today and which was coined by a Swedish journalist in 1977 who recorded his visit to the town thus:
"The asphalt on the roads has cracked in the warm sun and along the sidewalks bushes are growing.
Today, September 1977, the breakfast tables are still set, the laundry still hanging and the lamps still burning.
Famagusta is a ghost-town".
As my hon. Friend the Member for Tooting said, if one goes to an elevated position at Dherenia—the closest village to Famagusta beyond the barbed wire—and looks through binoculars at the skyscraper hotels of the ghost town of Famagusta, one sees the tragic waste of an economic jewel. Adjacent to the barbed wire at Dherenia, there is a house that belongs to the family of a friend of mine, Mikis Xenophontos Ioannou. He would have been here today if business had not otherwise detained him in Cyprus. Xenophontos means the son of Xenophon, and old Xenophon—Mikis's father—rebuilt his house hard up

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against the barbed wire. That house is still there on the free side of the barbed wire, and that is one of the strongest indications one could have of the attachment that people have to the land that they rightly regard as their own.
I shall read a short excerpt from a poem which gives expression to that feeling. The poem, by Clairi Aggelidou, is called "The Day of Return":

"Save the key. It unlocks the house

When you go, you can open it up.

Keep it in a place that's safe

and do clean it up

now and again.

So it will be ready

when they say

'you can return …',

I won't return, like I thought,

you will,

once more you will see

the orchard and the walnut tree

I planted …

Guard the key.

Our yard will smell

of jasmin flowers

the Vine will be in fruit

though untrimmed for years."

Two more lines of the poem read:

"Do not cry.

Just guard the key well."

That is a tragic expression of the feelings of the people of Famagusta for the town which they look upon but to which they cannot return. Mikis Ioannou himself has written much moving poetry about his home town of Famagusta.
I have strong feelings about the town, because I spent some of my formative years in the area. I was a young soldier between the ages of 19 and 21 in the Famagusta area, and Famagusta was, in a sense, my home town. I walked the streets of Famagusta and Varosha, and I recognise the hotels that I can see through binoculars. Mr. Pouyouros was, in a sense, my mayor when I lived in Famagusta, and he has been the mayor of Famagusta from 1953 to the present day. I hope to see the day—I vow to see the day—when Mr. Pouyouros walks freely and with full dignity through the streets of Famagusta once again as its mayor.
The situation in Cyprus is tragic, and the situation of Famagusta within Cyprus is tragic, too—it is a tragedy within a tragedy.
The second invasion was not an afterthought but a land grab, by which those occupying 37 per cent. of the territory secured two thirds or more of the productive capacity of Cyprus, which is contained within their territorial mass.
As the seizure of Famagusta in 1974 was the keystone of the invasion, so Famagusta could be the key to a solution. One might suppose that it has been kept as a bargaining point.
My hon. Friend the Member for Tooting listed the various high-level statements and resolutions between 1978 and 1994, so I will not burden the House by repeating them. In conclusion, I suggest that, after all the years of prevarication, it is time that progress was made on the solution to the Cyprus problem and that a commencement of that solution should be the occupation
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and resettlement of Famagusta by its legitimate inhabitants—not as a fenced-in enclave, as Mr. Denktash insists, but in the form suggested by the hon. Member for Edmonton (Dr. Twinn). Again, I will save time by not alluding further to that suggestion.
At a time when we have seen progress in South Africa, the middle east, Bosnia and, today, in Northern Ireland towards what we hope are solutions to apparently intractable international problems, we must be optimistic and determined that progress can also be made towards a solution to the problem in Cyprus. As my hon. Friend the Member for Tooting said, the United Kingdom has multiple responsibilities in that respect. As the former colonial power, a senior member of the Commonwealth, which has expressed its support for the United Nations resolutions, a member of the Security Council and of the European Union, I call on the Government to show the renewed determination shown by the American Congress and President Clinton to finding a solution in Cyprus.
In the terms of early-day motion 110, I call
"upon Her Majesty's Government to press for the restoration of the fabric and infrastructure of Famagusta-Varosha and the resettlement of the town by the legitimate Greek and Turkish residents under the auspices of the United Nations, so that the two communities,"—
Turkish and Cypriot—
"by demonstrating that they can live and work together in peace and friendship, may engender that inter-communal trust and confidence upon which a wider and deeper solution to the Cyprus problem may be securely founded."
10.32 am
Ms Joyce Quin: Like all other hon. Members who have spoken, I congratulate my hon. Friend the Member for Tooting (Mr. Cox) on applying for and being granted this Adjournment debate on Famagusta and Cyprus. Once again, my hon. Friend has revealed to the House his extensive knowledge of the situation in Famagusta and Cyprus and his arguments have been backed up by the very evident knowledge of all hon. Members from both sides of the House who have spoken.
Many of us feel that Cyprus does not, perhaps, command much public attention, although people might feel that they now know something about it, rather unexpectedly, because of the evil machinations of one Francis Urquhart in "The Final Cut".
We have heard a rather more accurate picture of events in Cyprus, and much genuine concern about the need to get the reunification process started again and some real progress, from hon. Members on both sides of the House. Many important points have been made in the debate and I echo the comment of my hon. Friend the Member for Tooting, and other hon. Members, who said that Famagusta-Varosha is the best place to begin the confidence-building process and progress towards the peaceful reunification of Cyprus.
The history of Famagusta-Varosha is a sad one, as has been pointed out. Although I have not visited the area or viewed it from the barbed wire, which the hon. Member for Edmonton (Dr. Twinn) described, I have none the less been struck by some of the accounts of
"palm trees piercing through cracked tennis courts and leaning on crumbling rat-infested seaside villas",
and
"here a padlocked Barclays Bank … there a gutted sandwich shop listing the prices of 20 years ago".

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There is no doubt that Famagusta epitomises the tragedy of the separation and division in Cyprus. People in both communities have been deprived of their homes, indeed of their roots, and forced to move from places in which their families have lived for generations. Even today, people can go to the green line and see their home, but they cannot occupy it.
Like other hon. Members, I pay tribute to the mayor of Famagusta. It is striking that the structures of local government have been kept in place, despite the fact that Varosha is a ghost town. The spirit of a unified Cyprus, which remains strong, is embodied in the work of the mayor and his colleagues, who try to ensure that the community that they once represented in Famagusta survives and has some hope for the future.
As has been said, the area has become the focus of confidence-building measures in Cyprus—measures to try to create conditions for future reunification. It is still true, however, that the level of mistrust is very high. Indeed, I read only a week or so ago press reports of young people shouting insults to each other across the green line that divides the country. Perhaps it is not surprising, although it is highly regrettable, that there is a climate of bitterness—a climate that is not always conducive to long-term living together.
I am also struck, however, by the number of people in Cyprus who want to embark on the confidence-building approach and who see an opportunity to do so in the immediate future. I strongly agree with my hon. Friend the Member for Hornsey and Wood Green (Mrs. Roche), who drew attention not merely to the political but to the economic potential of such measures. As has been said, the area concerned had huge economic potential 20 years ago as a tourist resort and was a centre for service industries and other types of economic activity.
Confidence-building measures would be of immense importance to Turkish as well as to Greek Cypriots. The adjoining area of Turkish Cyprus is not well off economically. We hear many accounts of the increasing economic disparity between the Turkish and Greek Cypriot areas. Greek Cypriots are said to earn, on average, three times as much as Turkish Cypriots and the discrepancy seems to be growing. There is enormous economic potential that can be mobilised for the future.
I look forward to hearing what the Minister has to say in his reply. I hope that he can give us a progress report on the attempts to move towards confidence building and to finance some economic activity in the area. We know that money is available in the European Union for activities in the Mediterranean. Also, when Cyprus moves towards European Union membership, it will be eligible for EU support. I hope that the Minister will address that point.
In the past few days, we have read many accounts about the European Mediterranean agreement, which brings together a large number of Mediterranean members of the European Union and their neighbours. It includes Cyprus and Turkey as well as Greece, as a Mediterranean member of the European Union. We believe that that is an important framework which can be used to bring both political and economic benefits to the region. We applaud the fact that within the European Mediterranean agreement there are commitments to democracy, human rights and the rule of law as well as to free trade and economic co-operation. We are keen for that to be built on in future.
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My hon. Friends have referred to the question of European Union membership for Cyprus. The Labour party is anxious to promote that as much as possible. Indeed, we hope to be in government when we welcome Cyprus into the European Union and to take part in the negotiations with Cyprus, which are due to start six months after the end of the intergovernmental conference which begins next year.
Cyprus's move towards membership of the European Union could be an important part of bringing about the peaceful reunification of the island. For that reason, we want progress. We are aware of the situation in respect of the customs union with Turkey. Although we will continue to express our grave worries about human rights in Turkey, we accept that some moves have been made.
We also understand the dangers of fundamentalism in Turkey and of Turkey's looking too much to the east, rather than the west. I accept those points, but none the less reiterate what my hon. Friend the Member for Hornsey and Wood Green said and hope that the Government, as well as the United States, will put pressure on Turkey not only in respect of human rights but to adopt a favourable attitude toward Cyprus's membership of the European Union. As several hon. Members have said, we do not want Turkey to have a veto over Cyprus's membership of the European Union. European Union membership can be part of the solution to the Cyprus problem and we must keep that in mind.
We believe that the future lies with a reunited Cyprus which respects human rights and different cultural and religious traditions and allows them to flourish in the Cyprus and the European Union of the future.
10.42 am
The Minister of State, Foreign and Commonwealth Office (Mr. David Davis): Cyprus matters to the United Kingdom. It is rightly the regular focus of attention in the House and the hon. Member for Tooting (Mr. Cox) has found an ingenious and appropriate avenue for the discussion of the problem of Cyprus. I congratulate him on that and join him in welcoming the mayor of Famagusta to our proceedings.
This has been a wide-ranging and rather long debate, so I shall be pressed for time. To a large extent, it has also been measured and well informed. I commend hon. Members for that. My hon. Friend the Member for Edmonton (Dr. Twinn) made a particularly wise contribution.
Famagusta is a window on the serious problems that beset the island of Cyprus. The city, as many hon. Members have said, is a symbol of the long dispute between the two communities—a dispute which has led to the tragic division of the island. The hon. Member for Tooting ranged wide in his speech. The House has said that it expects me to range beyond the troubled boundaries of Famagusta and to recap on Government policy on Cyprus. Indeed, the hon. Member for Tooting asked me what we are doing to promote a settlement. I shall, in the time available, endeavour to answer as many questions as I can on those subjects.
The natural advantage of a good harbour has meant that Famagusta has been at the centre of events that have shaped the eastern Mediterranean. The ancient walled city has been the target of many imperial ambitions. As one

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of the main emporiums of the Levant in the middle ages, it is not surprising that it became an ethnic and religious melting pot. It is, of course, the "Sea-port Town in Cyprus", the backdrop to the "Cyprus Wars" in "Othello". It is no stranger to war—tens of thousands perished on both sides in the siege laid by the Ottomans in 1570–71, to which the hon. Member for Knowsley, South (Mr. O'Hara) referred.
Famagusta retained its economic importance into modern times. In 1960, when Cyprus became independent, it was the island's third city with large Greek and Turkish Cypriot communities. The modern commercial town facing the beach became a tourist riviera and thus a significant contributor to the Cypriot economy. The city was the island's principal port until 1974.
The fate of Famagusta and the suburb of Varosha, or New Famagusta—I am grateful to the hon. Member for Knowsley, South for explaining the details of those names—after the Turkish intervention touches a raw nerve for many Cypriots. Its significance for both communities is not difficult to understand. The walled city of Famagusta was a Turkish Cypriot enclave which endured its share of sufferings in the intercommunal violence of the 1960s and 1970s. The 35,000 people who fled Varosha in August 1974 were a substantial portion of the total number of Greek Cypriots displaced during the tragic events of that summer.
The Turkish decision to fence off Varosha and effectively prevent any settlement has created, as many hon. Members have said, one of the strangest sights in Europe. The spectacle of crumbling luxury apartments left to rot for the past 21 years—a ghost town, as hon. Members have called it—is a symbol of the Cyprus problem.
Who has benefited from this monument to waste? Certainly not the Greek Cypriots, who have been deprived of their property for so long; nor the Turkish side, which has to guard a decaying ghost town. It might seem perverse that the international community insists that Varosha, as a fenced-off area with no settlement, retains its special status, but the fact that it is a closed area keeps alive the hope that, one day, its original inhabitants might return.
The Security Council of the United Nations, in its resolution 414 of 15 September 1977, made clear its concern that any moves by Turkish Cypriots to settle Varosha would harm the prospects for a settlement. That is still the position today. The international community has been periodically alarmed by reports of plans to move into parts of Varosha. We continue to believe that any action of that sort in the absence of a settlement would be a setback.
Against that background, it is not hard to understand why Varosha has been at the centre of efforts to reconcile the two communities since 1974. In the sad logic of prolonged disputes, the simple fact is that the Turkish side has something which the other side wants back. In the aftermath of the events of 1974, there were hopes that a solution to Varosha could he found quickly. We have heard a good account of that from the hon. Member for Tooting. As a closed area, there were no serious practical obstacles to handing Varosha back, but repeated efforts to make progress have yet to find an acceptable means to end this absurdity once and for all.
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There have been various ideas for resettlement under United Nations control. Indeed, each phase of the all too fitful intercommunal talks has involved a negotiating package for Varosha. Just over a year ago, it seemed that both communities were finally prepared to commit themselves to arrangements which would allow Varosha to come alive again.
During 1993–94, the United Nations Secretary-General and his representatives worked with both communities on a package of confidence-building measures, or CBMs in the Foreign Office jargon. The proposals envisage the resettlement of Varosha as an area for bi-communal contacts and enterprise and the reopening of Nicosia international airport. Both would remain under United Nations control. The package contained real benefits for both communities. The United Nations worked non-stop to close the gap between the sides. Unfortunately, in the end, neither side managed to seize the opportunity. Success would have cleared the way for direct contacts on the basis of a settlement.
Failure meant each side retreating into familiar recriminations. In June 1994, Mr. Denktash set out—admittedly at a very late stage—the circumstances under which he could accept implementation of the confidence-building measures. I can well understand the frustrations of the Greek Cypriot side at that response. I can understand that, after months of waiting for Mr. Denktash to say yes, they felt frustrated when he replied, "Yes, but".
However, we believed that, even at that stage, there was value in pressing on with efforts to reach an agreement on the confidence-building measures. We still believe that such an agreement can only be helpful in achieving the wide objective of a settlement in Cyprus. We believe that the package is still viable, and Mr. Denktash's decision in January to accept the CBM package was a welcome, albeit belated, move. Both leaders would earn the plaudits and the encouragement of the international community if they returned to the CBM package.
As to the Turkish position, I was asked about the meeting that took place between my right hon. Friend the Prime Minister and the Prime Minister of Turkey, Mrs. Ciller, last week. They both agreed that it was high time for progress on the issue, and my right hon. Friend left Mrs. Ciller in no doubt about the role that we expect Turkey to play. Turkey can exert a positive influence on Mr. Denktash and we made it clear that we want that to happen.
Mr. Anthony Coombs: Will my hon. Friend give way?
Mr. Davis: I am very short on time and I am afraid that I cannot allow any more interventions.
Why is the situation in Famagusta and Varosha important to the House and to Britain? Human compassion for those of both communities who have suffered is of course one reason, but the wider Cyprus problem and the search for a settlement is an issue at the centre of British foreign policy.
Cyprus has long been important to British interests. I could spend a good deal of time talking about the history of our relationship, but it has been already been recounted by other hon. Members. We do not need to look very far for evidence of the closeness of our relationship. Cyprus draws 1 million British tourists to its shores every year.

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People of Cypriot origin are part of the landscape in Britain—especially in London—and they have made a welcome contribution to British society.
We also have an important and substantial trading relationship with Cyprus. Some 10 per cent. of all exports to Cyprus—worth £230 million—are British and our imports from Cyprus amount to £136 million. It is also necessary to recall that our two sovereign base areas in Cyprus remain of fundamental strategic importance to the United Kingdom and the west. The Gulf war was a strong and a recent reminder of that fact.
A distinguished British observer of the Cyprus scene during the past three decades has commented:
"Nobody won and everybody lost by reason of this futile conflict".
I agree. The division of Cyprus since 1974 has been damaging and wasteful, as Varosha itself illustrates. It cannot go on. We have always said that the division of the island is unacceptable. Our efforts and those of the international community continue to aim for a solution based on reconciliation between the two communities.
We are bound by history and by a moral duty to do all that we can to help to find a solution. The international community also plays it part, but neither we nor it hold the solution in our hands. Only the main protagonists, the two Cypriot communities, can decide what arrangements they can live with, but we can and must assist with advice, encouragement, support and even a degree of arm-twisting—hon. Members know that I am not very familiar with that—if we judge that it will help.
My hon. Friend the Member for Banbury (Mr. Baldry) took the House through recent developments when we last debated Cyprus. He said then that the status quo was not acceptable, and he was right. I shall now recap events and bring the House up to date on the Cyprus situation.
The United Nations Security Council resolution 939, passed on 29 July 1994, called for a fundamental and far-reaching reflection on ways of approaching the Cyprus problem in a manner that would yield results. It also called for the earliest possible implementation of the confidence-building measures that are so important for the future of Varosha.
In October 1994, the UN Secretary-General invited the two community leaders to talks with his representative in Cyprus. That offered a welcome opportunity for the two leaders to meet face to face and to discuss the issues between them. We were hopeful that a new willingness to compromise was emerging. President Clerides adopted a useful and a positive approach to ways of achieving a settlement, and Mr. Denktash reaffirmed his commitment to a bi-zonal, bi-communal federation. We were disappointed that nothing concrete emerged from the meeting, but we remained hopeful that those contacts might form the basis of further contacts.
The United Nations continued its contacts with the two leaders, encouraging them towards a common perception of the kind of trade-offs needed to make real progress. The build-up to elections in northern Cyprus in April inevitably produced a pause in international efforts. As the House knows, Mr. Denktash was re-elected. We shall not let him forget that, during his election campaign, he said that he saw himself as the candidate best fitted to negotiate a settlement for the Turkish Cypriot community.
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The House will be aware of the exploratory discussions between representatives from both communities in Cyprus which took place in London in May. The objective of the talks was to generate momentum behind the UN efforts to find a settlement. We felt that that might be achieved through confidential contacts away from the intense gaze of publicity in Cyprus. Both groups met American and British representatives to talk over the issues and to share views on the paths and obstacles to progress. They also had direct discussions with each other.
If I say that there was a helpful exchange of views, hon. Members will know that that is diplomatic language to describe meetings which did not yield as much as we had hoped, but it does not mean that that approach to the issue was worthless. We and the Americans still believe that confidential contacts can provide a way forward. However, I stress the word "confidential"—both communities must resist the urge to play to the gallery.
The British high commissioner and the US ambassador in Nicosia have unstintingly maintained contact with both leaders and urged them to focus on the main ingredients of a settlement. The US presidential envoy, Richard Beattie, will visit Cyprus next week to follow up the London talks. It is important to remember that there are a number of strands to the international efforts to find a settlement. We welcome the appointment of Dick Beattie and we have been fully and closely involved in his activities and initiatives—including the May talks in London—and in preparing the ground for his forthcoming visit to Cyprus. The London talks were a product of our collaboration with the Americans. They were a brave attempt, but they did not constitute a new, self-standing initiative. As I have said, they support the mission of the United Nations Secretary-General.
That is also true of progress on the route now mapped out for Cyprus's accession to the European Union. The House might find it helpful to have an account of where we are on that route. The Republic of Cyprus applied to join the European Union in July 1990. The European Commission submitted an opinion on Cyprus's application in June 1993. The opinion confirmed Cyprus's European identity and character and its vocation to belong to the Community. It also clearly envisaged that the accession process would provide an opportunity to resolve the central elements of the intercommunal dispute—I was pleased to hear the Opposition spokesperson confirm that view today. The opinion states:
"the fundamental freedoms laid down by the treaty … could not today be exercised over the entirety of the island's territory.
These freedoms and rights would have to be guaranteed as part of a comprehensive settlement restoring constitutional arrangements covering the whole of the Republic of Cyprus".
In Corfu in June 1994, the Heads of Government of the European Union agreed that Cyprus would be involved in the next stage of enlargement. That view was reaffirmed at the Essen European Council in December 1994. The Commission reviewed the question of Cyprus's accession to the European Union in February, and that review confirmed Cyprus's suitability for accession.
A further step was taken at the Foreign Affairs Council on 6 March. The council's conclusions outlined the circumstances under which accession negotiations will start, six months after the end of the 1996 intergovernmental conference. The Council called for progress in the intercommunal dispute and noted that some useful points had been identified recently.

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The European Union's Association Council with Cyprus has since set out a substantial pre-accession strategy, with a structured dialogue. The first ministerial meeting between the 15 European Union countries and Cyprus took place on 21 November. The dialogue on political issues and the pre-accession strategy will serve to bring Cyprus closer to the European Union before formal accession negotiations begin.
Significant progress has been made on the road to Cyprus's accession to the European Union, and we have been at the forefront of that progress. Indeed, in March 1995, President Clerides singled out Britain among EU member states for our helpful contribution regarding Cyprus. We are grateful for his compliment. We have indeed been working hard on Cyprus's behalf.
Mr. Deputy Speaker (Sir Geoffrey Lofthouse): Order. Time is up.

Fire Services (North Worcestershire)
11 am
Mr. Anthony Coombs: I want to draw attention to a matter of great controversy and sensitivity in my constituency—proposals to change fire cover in the Wyre Forest and north Worcestershire area.
I start by paying tribute to the firemen of the Worcestershire and north Worcestershire area, who do a magnificent job. Indeed, two members of the Hereford and Worcester brigade lost their lives in 1993, fighting a fire in Hereford.
The proposals by the chief fire officer, as part of what he called a "zero-based fire cover review", in September 1995 are unacceptable to people in my constituency, and reduce fire cover to an unacceptable level. It is proposed to close the retained station at Bewdley, and to halve the full-time complement at Kidderminster, reduce the number of its appliances and remove its hydraulic platform.
That has caused a huge amount of controversy. We have received a petition of 25,000 signatures against the proposals. The Wyre Forest district council has a special working party to act against them. The proposals have been the subject of innumerable meetings and letters to me and to Hereford and Worcester county council. I hope that, even at this late stage, the people responsible in the fire authority will review their proposals, which are unacceptable.
I understand that the county council has set up a working party, which is due to report by the end of January 1996. Although, under the Fire Services Act 1947, the proposals must ultimately go to the Home Office for approval, I hope that those proposals will be withdrawn before that becomes necessary.
Although much has been said about the financial background to that matter, I do not believe that the financial background is the principal cause of the proposals about which so many fears have been expressed. Indeed, several councillors have said that, even were they able to spend more money on the fire service, it would continue to be intent on those wrong-headed proposals. Nevertheless, I should say one or two things about the background to the financial position of the fire service in Hereford and Worcester.
Hereford and Worcester is bottom of all shire counties in its standard spending assessment per head allocation for fire—about £16.80 per head, by contrast with an average for the shires, let alone the metropolitan areas, of about £20.55. That effectively means that, instead of the county being able to spend about £14 million a year—which is what is actually spent, because the county council spends money in addition to the allocated SSA—which would have been the case had Hereford and Worcester been given an SSA at the county average, only £11.5 million is spent related to the SSA.
Mr. Michael Spicer: I am grateful to my hon. Friend for giving way in an excellent speech, in which he makes an important argument on behalf of his part of the county. I am the Member of Parliament for the other part of the county, which is covered by the same fire service, which, as my hon. Friend knows, was enormously stretched this summer in, among other things, putting out those enormous fires on the Malvern hills.

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I have a problem similar to that of my hon. Friend. The fire service is starting to speak about closing Pebworth fire station in the same way as the Bewdley fire station in my hon. Friend's constituency. In the context of what my hon. Friend is saying, I wanted to ask him about funding.
Is it not peculiar—I have previously drawn this matter to the attention of the Minister—that the way in which fire services must spend their money is calculated on the basis of risk analysis, but the money that is made available for them is calculated on the basis of historic spend? There is a mismatch between the budgeting process and the funding process. Is that not at the back of my hon. Friend's argument?
Mr. Coombs: My hon. Friend is absolutely right. To give an idea of the scale of the problem we have, not only is there a gap of 21 per cent. between the shire average SSA and the Hereford and Worcester SAA, but that gap has grown historically. Even if the plan is implemented by the chief fire officer, the gap will increase to about 30 per cent.
I know that Baroness Blatch has spoken to members of Hereford and Worcester county council about that matter. I know that the Government are reviewing the area cost adjustment, which militates against counties in our region. I also know that the Government, with the Department of the Environment, are reviewing the mechanism by which the fire service SSA is calculated.
I am worried that the Hereford and Worcester county council fire brigade appeared not to know what the nine options were that had been laid down in that working party for the review of the SSA. However, as my hon. Friend the Member for South Worcestershire (Mr. Spicer) says, there is a significant difference between the options.
For instance, option 1, which, on fire safety, would give greater credence to the number of premises and plans that were covered by the fire service and, on fire prevention, would give greater credence to the number of pupils in schools, would mean that an SSA settlement for Hereford and Worcester would be increased by 23 per cent. on 1995–96 figures, or by £2.7 million, which would reflect current spending in the way we require.
There is a strong case for, not an activity-based approach, but a fire station-based approach, based on the number of homes and the sparsity of population in much of the area. I urge Ministers to get on with considering such a redistribution of resources. I hope that we shall hear something good when we hear the local government finance settlement, which we expect tomorrow.
It is an irony that the proposals, far from saving money, will cost about £340,000 to implement and £240,000 a year from then on. They involve the redundancy of 28 whole-time personnel from Kidderminster—half the whole-time personnel—the removal of a whole-time pumping appliance and the hydraulic platform there, and the closure of the Bewdley retained station, in a way that has caused uproar.
Those proposals are wrong-headed for several reasons. First, they are a perverse redistribution of resources, even within the county. Kidderminster, which, in the period July to September 1995, had 762 turn-outs, will be downgraded, whereas Bromsgrove, which had only 427, will be upgraded to the same level as Kidderminster, in spite of the fact that it had only slightly more than half the number of calls. With the closure of Bewdley,
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Kidderminster, even on a downgraded basis, will now be expected, with half the whole-time personnel, to cover an area not of 50 square miles, as hitherto, but of 90 square miles.
The boundaries set within Bewdley between those areas that are designated C in the review and those that are designated as lower-risk D areas lack all logic, owing more to the squares of the Ordnance Survey map than to any idea of the community and the physical geography. The Lakes residential estate is regarded as a C risk area, whereas St. Anne's middle and first schools, where there are a great many vulnerable young people right next to the Lakes industrial estate, are regarded as being in a D area.
The fact that Kidderminster has been downgraded from B to C status does not reflect the very many small factories, many with chemical and electrical processes, in the town. The matter has been drawn to my attention by firefighters in the area.
Moreover, the proposals completely ignore the historic nature of Bewdley, the proximity and complicated nature of its buildings, the high proportion of elderly people in its population, and the presence of tourist attractions such as the Severn valley railway and the safari park, which not only increase the risk of fire but make access difficult, particularly during the rush hours and at tourist peak times.
I shall concentrate on two specific problems. The first relates to response times. If a fire service is to be credible, its fire engines must be able to reach a fire within the time laid down. The centre of Bewdley is designated a C area, which means—according to Home Office recommendations—that one fire engine must reach a fire in between eight and 10 minutes. If the proposals are implemented, that fire engine will have to come from Kidderminster.
In a letter dated 11 September, the chief fire officer told me that that could be done in eight minutes. On 19 September, he elaborated on that, saying that it could be done
"at a speed of no more than 30 mph, with no lights or two-tone alarms, obeying traffic regulations and in a rush hour."
His deputy took the same line, saying that trials had been carried out showing that the journey could be done in eight minutes and 45 seconds. Most people, including firefighters, do not believe that; although the distance is only about three miles, they do not see how it could be achieved.
I have discovered the answer, however. Apparently, the calculation is done on the basis that the clock stops when the vehicle is stationary. It will not be of much comfort to someone in a fire to be told, "We can get to you in eight to 10 minutes, provided that our fire engine is moving all the time." If the vehicle is held up by traffic lights or a traffic jam, the period could be much longer, and lives could be put at risk. That, I feel, reveals the absurdity of the fire officer's argument that response times will be acceptable.
It is suggested that, in the event of a fire in, for example, a block of flats, a hydraulic platform can be transported from Bromsgrove to Kidderminster—a distance of at least six miles—within that period of eight to 10 minutes. According to Mr. R. E. Smith of Kidderminster, who drives that hydraulic platform,
"If he thinks the hydraulic platform can provide adequate cover from Bromsgrove"—

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"he" being the chief fire officer—
"he is wrong. I drive the appliance. He doesn't. I doubt if Mr. O'Dwyer has even the slightest idea how long it would take an appliance such as the hydraulic platform to get from Bromsgrove to Kidderminster."
He is sure that it would not be possible to take the platform to the scene of the fire within the required time, particularly during rush hours.
My second point relates to the cost of fire cover. If the full-time team of firemen in Kidderminster and their pumping appliance are to go—and, according to best practice, there should be two appliances for each fire, so that back-up is available—retained crews will have to be called out for every fire. It has been estimated by the Fire Brigades Union that turn-outs by retained firefighters would increase by no less than 398 per cent. in my area.
First, that is likely to increase costs, which should be allowed for in the review. Secondly, it will affect recruitment. As a firefighter asked in a letter to me, what employers will allow their fire officers to have four times as much time off as they had before? Thirdly, because retained firefighters cannot reach a fire as quickly as non-retained full-time firefighters, the speed of attack and the effectiveness of firefighting will be reduced.
I am also concerned about the way in which the fire brigade, the fire authority and the county council have consulted on these controversial proposals. This is not the first time that such consultation has taken place; in 1988, 1993 and 1994, the townspeople of Bewdley—with my support—repelled attempts to close their fire station. Although the circumstances of the town were exactly the same then as they are now, special circumstances of the kind that I have outlined were identified by professional officers on the fire review team, and it was decided that the station should remain open.
The same circumstances obtain today. Indeed, the original fire cover review report—produced by three senior officers and others for the chief fire officer earlier this year—specifically states that, although in statistical terms there may well be a case for closing the Bewdley fire station, as there has been on all the previous occasions,
"Having paid due regard to these influences, it is our professional opinion that the fire station at Bewdley is maintained as at present.
The town is of historic importance, and many of the properties are of architectural value. The attractive riverside properties provide a backdrop to a thriving community reliant upon the tourist industry."
The report refers to the River Severn and the safari park, which attract hundreds of thousands of visitors each year—people who contribute significantly to the county's economy. It adds:
"The hotels, restaurants, shops, guest houses and leisure facilities that line the narrow streets of Bewdley present a substantial fire risk and the potential for rapid fire spread with dire consequences is ever present. It is for these reasons that we cannot recommend the closure of Bewdley fire station."
That is said every time the closure is proposed. It was said this year, and completely ignored by the chief fire officer.
I understand that the document was given anonymously to the chairman of the Wyre Forest working group which is studying the proposals. He—Councillor John Gordon—openly gave it to the chairman of the county council's fire
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services committee, who photocopied it and gave it back to him. At 4 o'clock on 27 November, the police raided the home of this gentleman, who was doing his best to help the people of Bewdley to retain their fire service, saying that they were dealing with the theft of a document.
Initially, the chief fire officer denied any knowledge of the document. Then his deputy said, "Okay, it does exist, but only minor grammatical changes have been made." In fact, the main thrust of the proposals had been completely changed. The first version said, "Do not close Bewdley fire station"; the second said, "We are going to close it."
On 30 October, the Home Office—in the person of Baroness Blatch—wrote to me saying that the Home Office would give permission for changes to the fire service only
"when representations have been considered by the authority."
The authority appears to be ignoring even the advice of its own professional officers, a group that it set up specifically to examine the fire cover review. I do not believe that it can be proved that the consultation exercise has been carried out thoroughly, and I hope that that will weigh heavily with Ministers if these wrong-headed plans are ever submitted to them. Even at this late stage, I sincerely hope that they will not.
I ask the Government to review the SSA allocations for fire cover, and the way in which the area cost adjustment is calculated. If the county council rejects the proposals and reduces fire cover in the Wyre Forest area, saying that it is unnecessary and expensive, without a jot of popular support, that would be potentially dangerous.
11.19 am
The Parliamentary Under-Secretary of State for the Home Department (Mr. Timothy Kirkhope): I congratulate my hon. Friend the Member for Wyre Forest (Mr. Coombs) on securing this debate on the fire service in Worcestershire. May I also welcome to the debate today my hon. Friend the Member for South Worcestershire (Mr. Spicer), who I know is most interested in these matters?
The Government have a high regard for the fire service, a regard that is shared by the general public. In its report on the fire service earlier this year, entitled "In the line of fire", the Audit Commission stated that the fire service can be proud of its record in responding to incidents, that it has high levels of skill and professionalism, is staffed by able managers and courageous front-line staff, and is held in great esteem by both the general public and individuals who have needed its assistance.
I whole-heartedly endorse the commission's comments and, indeed, have a personal reason for being pleased to be here today: my late father was a member of the well-known National Fire Service at the beginning of the war. The photographs in our family album show him with rather more primitive equipment than is at present deployed by the fire services of this country, but nevertheless those photographs give my family a great amount of pride.
One of my earliest memories is of being taken to Newcastle's Pilgrim street fire station by my father and being allowed to descend the pole—not the greasy pole of politics—and to see the firemen polishing the bells on

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their fire engines. I do not know whether they still do that in my hon. Friend's constituency, but it is a matter of great pride to me that I have those early recollections.
My hon. Friend referred to Government funding of the fire service, and to SSAs. There are two underlying issues in relation to fire service funding: whether the total public expenditure provision for local government is sufficient; and, given that total, how we distribute it in terms of SSAs among the local authorities.
The total provision has to be broadly consistent with our restraint on public expenditure as a whole. I am sure that my hon. Friend is aware of that need. The Government concluded that, for 1995–96, local authorities as a whole should have an increase of 0.8 per cent. when compared on a like-for-like basis with 1994–95.
That is not as much as many would have liked, but in our view the settlement for 1995–96 was realistic in the current economic climate, in the context of low inflation and the requirement that pay increases in the public sector should be met from increased efficiency. It reflected a balanced and reasoned judgment on the understandable desire for more local authority expenditure and on what the country can afford.
My right hon. Friend the Secretary of State for the Environment, as my hon. Friend has mentioned, will be making an announcement tomorrow on the provisional local government finance settlement for 1996–97. My hon. Friend referred to the distribution formula for the fire service element of SSAs. We have indeed been looking, with the Department of the Environment and local authority associations, at the formula for 1996–97, taking account of matters such as pensions, fire safety and other factors that the associations wish to raise.
Mr. Michael Spicer: Does fire safety include the concept of fire risk, which is at the root of the budgeting arrangements in which the fire services have to engage?
Mr. Kirkhope: My hon. Friend has raised that matter with me once before, and I undertook then to look at it. I am still doing so, and understand that it is a possible area to be considered.
It is important to remember that a shire county is not limited in its spending on its fire brigade by the fire service share of its SSA. What matters is the overall SSA for the county council. It is for the county council to decide its priorities for spending across all its services, bearing in mind its statutory and other responsibilities.
Before I refer specifically to the fire service in north Worcestershire, it would be helpful if I explained the framework within which decisions about fire cover are taken. It is important to remember that the fire service is a local authority service—it has been since the Fire Services Act 1947 transferred firefighting functions from the wartime National Fire Service, to which I have already referred.
Statutory responsibility for providing an effective and efficient fire service to meet all normal requirements rests with the local fire authority. It is for the fire authority—Hereford and Worcester county council, in this case—to decide how much of its overall budget to spend on its fire service to comply with its statutory responsibilities.
As to the Government's role, my right hon. and learned Friend the Home Secretary has various duties under the Act. He monitors performance through Her Majesty's
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inspectorate of fire services, and is responsible for promoting high and consistent standards in such matters as training, equipment, promotion and recruitment. As my hon. Friend the Member for Wyre Forest said, under section 19 of the Act, my right hon. and learned Friend is also required to be notified of the fire authority's establishment—the number of its fire stations, fire appliances and firefighting posts—as at 1 January each year. Of particular relevance to the debate is the fact that the fire authority may not reduce its establishment, although it can increase it, without my right hon. and learned Friend's consent.
My right hon. and learned Friend has a specific and limited role in considering applications under section 19. He grants approval where the following conditions are satisfied. First, the proposals must have been sufficiently widely publicised, in sufficient detail and with adequate time, to enable any interested party to make representations; my hon. Friend referred to the question of consultation and representations. Secondly, the representations must have been considered by the fire authority; thirdly, after taking advice from Her Majesty's inspectorate of fire services, my right hon. and learned Friend must be satisfied that the nationally recommended standards of fire cover will be maintained.
I must emphasise that it is not the role of my right hon. and learned Friend to decide whether the proposals that a fire authority makes represent the best arrangements for fire cover. Her Majesty's inspectorate of fire services is available to advise the authority on that matter. Ultimately, however, responsibility rests with the fire authority, which is accountable in law for the service that its provides.
The 1947 Act does not define the test of an effective and efficient fire service, which a fire authority must provide to meet normal requirements for fire cover. But it is long-standing practice to interpret that by reference to the nationally recommended minimum standards of fire cover. The standards are not just nationally recommended; they are nationally agreed in the Central Fire Brigades Advisory Council, which was established by the 1947 Act and on which the relevant fire service organisations are represented. They were also reviewed by the Joint Committee on Standards of Fire Cover in 1985 for the Central Fire Brigades Advisory Councils for England and_ Wales and for Scotland. The standards enable all concerned to know where they stand as regards the minimum level of service that they should be delivering.
The Audit Commission's report called for greater local flexibility in the application of the fire cover standards. It did not say precisely how the standards should be changed, and recognised that no change should be considered without careful research. The issue is being considered by the Central Fire Brigades Advisory Council, but it is a complex matter, on which much work will be needed.
Following the 1985 review of standards, all fire authorities in Great Britain reviewed their risk categorisation and the resources necessary to comply with the nationally recommended minimum standards. I am aware that an extensive review of fire cover was completed by the Hereford and Worcester brigade, and the results were circulated recently for public comment. I understand that the recommendations of the review could, if implemented, have significant implications for fire

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cover in my hon. Friend's constituency and elsewhere, and that they include proposals to close the fire station at Bewdley and to remove a pumping appliance that is staffed by full-time firefighters, and a hydraulic platform from Kidderminster.
The implementation of those recommendations, which involve a reduction of fire cover, would, as I have explained, require an application under section 19 of the 1947 Act for my right hon. and learned Friend's approval. It is a matter for the county council to consider what action it proposes to take in respect of that review, in the light of the representations that it has received and advice from Her Majesty's inspectorate of fire services. I hope that this will also take account of my hon. Friend's references to various other factors, such as response times, the interesting timing system and the earlier report surrounding the circumstances of Bewdley fire station.
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My right hon. and learned Friend has already received a number of representations—including, of course, one from my hon. Friend, about the fire cover review. I can assure my hon. Friend that, should the county council make application to reduce fire cover in any part of the county, my right hon. and learned Friend will take those representations into account in reaching his decisions. I am sure that the county council will wish to give careful consideration to the points that my hon. Friend has made today.
It being half-past Eleven o'clock, the motion for the Adjournment of the House lapsed, without Question put, pursuant to Order [20 November].

PRIVATE BUSINESS

  SELECTION
  Ordered,
  That Mr. Ray Powell be discharged from the Committee of Selection and Mr. George Mudie be added to the Committee.—[Mr. Conway.]

Oral Answers to Questions
  FOREIGN AND COMMONWEALTH AFFAIRS

    Gibraltar
    Mr. Garnier: To ask the Secretary of State for Foreign and Commonwealth Affairs when he last visited Gibraltar to discuss United Kingdom-Gibraltar relations. [850]
    The Minister of State, Foreign and Commonwealth Office (Mr. David Davis): I visited Gibraltar on 7 and 8 November this year and had a range of discussions with Gibraltarians.
    Mr. Garnier: I congratulate my hon. Friend on his recent visit to Gibraltar which was, by all accounts, a most successful visit. Is my hon. Friend aware that drug smuggling and tobacco smuggling through Gibraltar have decreased drastically over the past six months? Can my hon. Friend give any reasons for the dramatic fall in those illegal trades?
    Mr. Davis: I thank my hon. and learned Friend for his flattering commendations. The reason for the fall in those trades is that Government action has closed them down. One of the most notable outcomes of my visit to Gibraltar was hearing about the fact that 8,000 Gibraltarians turned out on the streets of Gibraltar to support the Government's action in closing down those criminal activities. In my judgment, that shows very strong support for the Government's actions in a community of just 30,000 people.
    Dr. Marek: Will the Minister give an absolute assurance that Gibraltar is within the European Union and that, for every circumstance, the boundary of the European Union runs around Europa point and not across La Linea?
    Mr. Davis: The hon. Gentleman is quite right. Gibraltar is within the European Union, but of course for some purposes, particularly free movement of goods, it falls outside the customs boundary. I think that is the point that the hon. Gentleman is seeking to make.
    Mr. John D. Taylor: In view of the improvement that the Minister has stated in relation to criminal activity in Gibraltar, what progress has been made in easing access between Spain and Gibraltar?
    Mr. Davis: Some progress has been made. Over the few weeks after that reduction in criminal activity, there was a 70 per cent. increase in the throughput of people coming into Gibraltar across the border. That amounts to some 70,000 people coming into a community of some 30,000 and was a material improvement. We have maintained our pressure on the Spanish Government because the delays are still too long, and we wish them to improve further.

    Nigeria
    Mr. Mark Robinson: To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has made to the Government of Nigeria concerning human rights in that country. [851]
    The Secretary of State for Foreign and Commonwealth Affairs (Mr. Malcolm Rifkind): We support the unprecedented decision of the Commonwealth Heads of Government meeting in Auckland to suspend Nigeria's membership. We also agreed with our European Union partners on 20 November a range of additional measures to mark our concern.
    Mr. Robinson: The abuse of human rights in Nigeria has gone on far too long. Does my right hon. and learned Friend agree with me that the Harare declaration, which the Prime Minister pioneered two years ago, has been most important in bringing the Commonwealth states together in their condemnation of the regime in Nigeria?
    Mr. Rifkind: My hon. Friend is correct. The Harare declaration was important in itself. However, the suspension of Nigeria for human rights reasons emphasises that the declaration was not simply a form of rhetoric but that it led to significant action.
    Mr. Robin Cook: Can the Secretary of State confirm that, in June this year, the Government gave a licence for the export of CS gas and rubber bullets to Nigeria? If he feels unable to confirm any individual sale, can he at least confirm that such products can no longer be exported under the new terms of the arms embargo? Does he agree that the most comprehensive arms embargo would be to cut off the cash flow from oil to the Nigerian military? At Monday's meeting of the Council of Ministers, will he support the German and Swedish proposal for an examination of the impact of oil sanctions on the Nigerian Government?
    Mr. Rifkind: On the hon. Gentleman's first point, I cannot comment on a specific licence application, but I can certainly confirm that, as a result of the total arms embargo now imposed, no weapons of any kind can be provided to the Nigerians so long as that embargo continues. We have not excluded the possibility of oil sanctions. It is important for the hon. Gentleman to remember that the major importer of Nigerian oil—40 or 50 per cent.—is the United States. It is therefore important to see whether there is a likelihood of unanimity for such an imposition in the Security Council. We have not ruled it out. It deserves further consideration.

    Arms Exports (Iraq)
    Mr. Ronnie Campbell: To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the Government's policy on arms exports to Iraq. [853]
    The Minister of State, Foreign and Commonwealth Office (Mr. Jeremy Hanley): We comply with United Nations Security Council resolution 661, which prevents the sale to Iraq of any weapons or other military equipment. In 1984 we introduced guidelines forbidding the export of lethal equipment, which were much tougher than those of any other major defence exporters. After 1984 the UK accounted for less than 3 per cent. of Iraq's defence-related imports.
    Mr. Campbell: Does the Minister agree that, now that Scott is due to report his findings, if any Ministers are found to be to blame for, or involved in, that gun run, they should resign?
    Mr. Hanley: The hon. Gentleman is right. The United Kingdom's policy on arms exports to Iraq from 1984 to

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    1992 is being considered by Sir Richard Scott. We shall take careful note of any conclusions and recommendations in Sir Richard's report, but we have no intention of commenting on the report until it is published.

    EU Intergovernmental Conference
    Mr. Betts: To ask the Secretary of State for Foreign and Commonwealth Affairs if he intends to publish a White Paper outlining Her Majesty's Government's priorities for the 1996 intergovernmental conference of the European Union. [854]
    Mr. Rifkind: This is still under consideration.
    Mr. Betts: If there is to be no White Paper—we have had no guarantee today—will the Secretary of State explain how the House is to hold Ministers accountable until the negotiations begin? Is the Foreign Secretary effectively saying that he cannot produce a White Paper because to produce anything at all would split the Conservative party down the middle? Will not the interests of the British people and the House have to take second place to the interests of the fragile unity within the Conservative party?
    Mr. Rifkind: The hon. Gentleman's comments are pretty absurd. Tomorrow, I shall give evidence to the Select Committee on Foreign Affairs precisely on the intergovernmental conference and our policy with regard to it. So there are many opportunities, which have been used in the past and will continue to be available, to ensure that the House is kept informed. We have not excluded the possibility of a White Paper, but I regard that as one of a number of ways of ensuring that the House is fully informed and able to contribute to our deliberations.
    Mr. Fabricant: Will my right hon. and learned Friend confirm that, if he were to publish a White Paper, one thing that he would not say is that we would give up our regional, environmental, social and industrial privileges—our veto? Does he agree that any thought of giving up our veto would have a damaging effect on jobs? Is he as amazed as I am that the Labour party is suggesting just that?
    Mr. Rifkind: Labour Members are suggesting that, and have committed themselves to it. Curiously, however, the Leader of the Opposition omitted to mention that point in his speech to the Confederation of British Industry on the social chapter. If he wanted to win industry to the Labour party's point of view, he could at least have come clean about the Labour party's current policy, which would make the social chapter subject to qualified majority voting.
    Mr. Robin Cook: Can the Foreign Secretary confirm that Britain is alone among the countries of Europe in resisting a common policy on racism as part of the revision of the treaty? We have the largest ethnic minority population in Europe. Why do the British Government oppose measures that would protect members of our ethnic minority population from discrimination when they travel in Europe? Does the right hon. and learned Gentleman not understand that, by opposing a European commitment against racism, the Government are opposing the interest of British residents and damaging Britain's standing among our European partners? Is that not just
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    another case in which the Government are sacrificing British interests and British influence to please the right wing of the Conservative party?
    Mr. Rifkind: That simply is not true. As the hon. Gentleman well knows, this country has the most effective race relations legislation in western Europe. There is no qualification with regard to our commitment to eradicating racism in all its forms. The Home Secretary made it clear not that he was opposed to ensuring the eradication of racism but that this is a genuine and open discussion on the best way to achieve that objective.

    United Nations
    Mrs. Ann Winterton: To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the future of the United Nations. [855]
    Mr. Rifkind: The United Nations will remain the principal mechanism for the resolution of threats to international peace and security, and the forum for addressing a wide range of global problems.
    Mrs. Winterton: Does my right hon. and learned Friend agree that NATO has been much more effective than the shambolic United Nations in the former Yugoslavia? Does he also agree that if the UN is to play any meaningful role in the world in future it must undergo a fundamental root-and-branch reform as a matter of urgency?
    Mr. Rifkind: NATO, of course, has operated in Bosnia at the request of the United Nations because the UN does not have the kind of military capability that is available to the Atlantic alliance. I agree that the United Nations financial arrangements need to be reformed. There is much waste and extravagance and the UN must be funded in a form that ensures that member states do not fall into arrears, because that has been undermining the UN's capacity to carry out its proper role.
    Mr. Menzies Campbell: I am sure that, like others, the Secretary of State was much encouraged by the vigorous rejection of isolationism by President Clinton this morning. Does the right hon. and learned Gentleman agree that the future effectiveness of the United Nations will depend on the whole-hearted commitment of the United States to that organisation? Will he take every opportunity to press that point on his counterpart in the American Government?
    Mr. Rifkind: The United States Government, and President Clinton in particular, need no such reminding. The problem with United Nations funding in respect of the US contribution arises because of the behaviour of Congress, which up to now has declined to authorise the appropriate funding despite the urging of the Administration. That is where representations and pressure need to be directed.
    Mr. Churchill: Does my right hon. and learned Friend agree that the effectiveness of the United Nations depends more on the United States' active involvement than on that of any other Government? Will he warmly congratulate the President of the United States on his fine address today to both Houses of Parliament in the Palace of Westminster? Above all, will my right hon. and learned Friend congratulate him on his categorical condemnation

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    of the forces of appeasement and isolationism, and wish him well in his battle with those elements in Congress that support such policies?
    Mr. Rifkind: I unreservedly pay tribute to President Clinton for his fine address this morning. The United States and the United Kingdom work well together and enable the great democratic forces to be as successful as they have been in recent times. The way in which the President emphasised the close bonds between the United States and the United Kingdom was very much in tune with the way that this country sees the transatlantic alliance.
    Mr. Tony Lloyd: The Foreign Secretary has gone some way towards dispelling the myths of the isolationists on both sides of the Atlantic. Is he prepared to pay tribute to the quiet work of the United Nations through, for example, UNICEF and the United Nations High Commissioner for Refugees? Those organisations have carried out valuable work over many years. Are the cuts in funding to United Nations agencies which were announced in yesterday's Budget in the interests of today's rhetoric by the Foreign Secretary?
    Mr. Rifkind: Of course I pay tribute to the work done by UNICEF and the United Nations High Commissioner for Refugees. The hon. Gentleman mentioned reductions that were announced yesterday. Most of them are possible because of the reduction in the forecast of what our contributions to the various multilateral organisations ought to be; therefore, I do not think that the programmes to which he refers will suffer in any way as a result of the announcements.

    Iraq
    Mr. Robathan: To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the situation in Iraq. [857]
    Mr. Hanley: The situation in Iraq remains poor for ordinary people. This is the direct result of the regime's failure to implement UN resolution 986, which would permit the sale of oil in return for humanitarian goods, or to meet its other UN obligations.
    Mr. Robathan: The House will note that this matter is to be discussed in an Adjournment debate later today. Has Iraq the ability to be a prosperous country and has it good natural resources? How much is the present regime spending on armaments and internal repression? Will my right hon. Friend confirm that there will be no move by the Government to relax sanctions because, far from encouraging democracy, liberty or prosperity in Iraq, that would be an endorsement of Saddam Hussein's evil regime?
    Mr. Hanley: I am grateful to my hon. Friend for his question because it helps to expose the true nature of the Iraqi regime. It is within Saddam Hussein's power to sell up to $1 billion-worth of oil every three months to provide humanitarian aid and medical supplies for his people. The relaxation of the import embargo depends on Saddam's complying with all relevant resolutions, but many matters remain cause for concern: Kuwaiti detainees, who are still unaccounted for; the human rights record, which is appalling; the internal economic blockade on Kurds and Shi'as; the mutilation of army deserters. Iraq is also
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    involved in state-sponsored terrorism and has failed to account for more than 600 missing Kuwaiti and third-country nationals.
    Mr. Dalyell: The Minister's description of the situation being "poor for ordinary people" just does not do justice to the appalling nature of the position. The Foreign Office has a full briefing of my visit to the children's hospital in Baghdad—two years ago, admittedly—when I saw rows of infants expiring, and the same was found at Um-Kasr. In its preparation for tonight's Adjournment debate on sanctions on Iraq, will the Foreign Office at least read carefully the letter that the Foreign Secretary has had from a much more recent visitor, Riad El-Taher, in which he describes the position and outlines Iraq's difficulty in complying with a United Nations resolution that is impossible for the people to accept, regardless of whether they support Saddam?
    Mr. Hanley: The hon. Gentleman's views on Iraq, on Saddam Hussein and on his regime are known to the House and, no doubt, we will hear more of them tonight. All I can say, however, is that we are conscious of the suffering of ordinary people in Iraq. Saddam, not the UN, is responsible for that suffering. Food and medicines are not subject to sanctions and, therefore, we ask again for Saddam Hussein to adopt United Nations resolution 986 and to allow Iraq to export some oil in return for humanitarian goods. He can do so. It is not impossible for him to do so. He could receive at least $2.5 billion net in the next 12 months, after charges for the resolution. He does not do so. I urge the hon. Gentleman to spend some of his time urging Saddam to help his people.

    French Nuclear Tests
    Mr. Hall: To ask the Secretary of State for Foreign and Commonwealth Affairs what representations Her Majesty's Government received on nuclear testing by France during the recent Commonwealth summit in New Zealand. [858]
    Mr. Rifkind: The Government not only received but made representations during the recent Commonwealth summit.
    Mr. Hall: What vital national interest is served by the Government's change in policy from not condemning the French nuclear tests to supporting them? Given the Foreign Secretary's warm welcome of President Clinton's address this morning, how did French nuclear tests help to lift the nuclear cloud that threatens our children's bright future?
    Mr. Rifkind: If the hon. Gentleman represented a party that had genuinely changed its view on nuclear weapons, he would understand that all the nuclear powers are committed to working towards a comprehensive test ban treaty, but it is not unreasonable to be sympathetic to the problems faced by our French allies as they bring their testing procedure to a conclusion. As in nuclear power, we understand that these are complex and sensitive issues, and we will not run to criticise a good ally that is committed to a comprehensive test ban treaty but believes that this is a necessary prelude to the completion of negotiations.
    Sir Peter Emery: Will my right hon. and learned Friend emphasise yet again that the commitment of the

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    French to signing the nuclear test ban treaty in the spring is of the greatest importance and needs to be emphasised absolutely for the people who are critical of it?
    Mr. Rifkind: That is the strategic objective. It is likely that the French nuclear tests will be finished in a couple of months from now and then the concentration will be on the global negotiations, to which France is as committed as any other country. It is difficult to understand why the Labour party seems to relish attacking a nuclear power when it simultaneously tries to persuade the British public that it supports the British nuclear deterrent.
    Mr. Jack Thompson: The Foreign Secretary will be aware that, in July this year, the Organisation for Security and Co-operation in Europe met in Toronto. One of the topics that was debated was French nuclear testing. He will also be aware that the only people who voted against the resolution to condemn the nuclear testing were the French, obviously, and the British Conservatives. Does he believe that the British Conservatives and the French are the only ones who are in step and that the rest of the world is out of step?
    Mr. Rifkind: I believe that it is the British Government's responsibility to come to a decision that is consistent with our national interest, not simply to join a pack hounding a good friend and ally regardless of our own beliefs on the issues at stake.

    European Political Union
    Sir David Knox: To ask the Secretary of State for Foreign and Commonwealth Affairs when he next expects to meet his counterparts in the European Union to discuss greater political union. [859]
    Mr. David Davis: My right hon. and learned Friend and I regularly meet our counterparts in the European Union at the Foreign Affairs Council. The next meeting will be held in Brussels on 4 and 5 December.
    Sir David Knox: Does my hon. Friend agree that the closer the co-operation within the European Union, the greater the influence that Britain can exert in international affairs?
    Mr. Davis: The Government's perspective on the European Union is that we intend to improve it by increasing prosperity and competitiveness, enhancing internal and external security, making enlargement possible and rebuilding popular support. We get support from all our allies in connection with all those factors.
    Mr. MacShane: Does the Minister accept that reform of the common agricultural policy, on which we now spend about £3 billion—£60 for every man, woman and child in the country—can be achieved only through co-operation with political allies in Europe and by asking them to drop the veto in that area, so that Europe can move forward on that front, especially in allowing the entry of the east European nations, which will not be able to enter Europe if the CAP is maintained in its present form?
    Mr. Davis: The hon. Gentleman is surprisingly ill informed. The great majority of common agricultural policies are already decided by qualified majority voting. He is simply trying to cover up his party's willingness to give up the veto on Britain's behalf.
    Mr. Cash: Does my hon. Friend agree that it is not enough simply to talk about co-operation, or about allies?
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    Does not political union really mean a legal framework within the rule of law, which—through majority voting, and in line with the arrangements promoted by 12, if not 14, of the other member states—would impose a state of affairs in which the British people would no longer be able to conduct their sovereign Parliament or make their own choices in general elections? Does he agree that we cannot contemplate that prospect, that we shall not do so at the intergovernmental conference and that we shall not give in to the pressures from Germany and elsewhere? Do we not need a White Paper to set out the British Government's position well in advance, so that the other countries know exactly where we stand, and we can explain our position to the British people?
    Mr. Davis: There is no doubt whatever about the British Government's position on qualified majority voting. I have made it clear, as has my right hon. and learned Friend, many times both at the Dispatch Box and to several Select Committees. It is clearly the case, and will remain the case, that decisions at the IGC are made by consensus, not by majority voting. So long as that applies—it will apply so long as we have any say in the matter—we shall stick to our guns on that subject.
    Mr. Spearing: With regard to the future of the political union that already exists, has the Minister noticed the section in the reflections group's first report about the place of national Parliaments? In particular, has he noticed paragraph 107, which mentions notice to national Parliaments of documents presented to the Council of Ministers—including those in the home and justice pillar, which of course do not come under our present scrutiny procedure? Does he agree that the suggested period of four weeks would have avoided the recent difficulties over the Home Affairs Council, and the document that the Commission presented there?
    Mr. Davis: I cannot comment immediately on the Home Affairs Council but, as I think the hon. Gentleman already knows, in the reflections group I have argued in favour of the Scrutiny Committee's comments on the declaration 13 position that he described.
    Mr. Dykes: As greater political union presumably means sovereign countries working closer and closer together in agreed integrated structures, including some majority voting, on which we robustly insisted for the single market, why is that so dangerous? Could the Government not occasionally say that it is a good idea?
    Mr. Davis: My hon. Friend is right in one respect; we supported qualified majority voting for areas in which we thought it would be useful in removing protectionism and protectionist tendencies within the European Union. That has promoted one of our country's greatest successes in Europe—the development of the single market.

    Public Interest Immunity Certificates
    Mr. Jamieson: To ask the Secretary of State for Foreign and Commonwealth Affairs how many public interest immunity certificates have been signed by Foreign Office Ministers since 1990. [860]
    Mr. Rifkind: Seven.
    Mr. Jamieson: Will the Secretary of State assure the House that he and his Department will not be following

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    the example set by his colleagues in the original Ordtech directors' trial, in which the right hon. Members for St. Albans (Mr. Lilley) and for Mole Valley (Mr. Baker) signed public interest immunity certificates to prevent information from landing in the hands of the directors' defence counsel, simply because, in the weeks leading up to the 1992 general election, that information would have proved at very best that the Government were turning a blind eye to the re-arming of Saddam Hussein?
    Mr. Rifkind: The hon. Gentleman is talking complete rubbish. As he well knows, public interest immunity certificates have existed for many years. Ministers do not have the last word on whether the documents covered by such certificates should be made available in a criminal trial. It is for the judge to decide, having taken into account the balance of public interest. That is the right and proper approach.

    BBC World Service
    Mr. Dowd: To ask the Secretary of State for Foreign and Commonwealth Affairs what action he proposes to take following the publication of the National Audit Office report on the BBC World Service. [861]
    Mr. Donald Anderson: To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the future of the BBC World Service. [865]
    Mr. Rifkind: I welcome the National Audit Office recommendations, which will lead to improved efficiency. The Government have a strong record of support for the World Service. Funding is up by 50 per cent. in real terms since 1980. The reductions announced yesterday apply to its capital allocation, and there is virtually no change in the amount of resources provided to cover its operating costs.
    Mr. Dowd: Is the Secretary of State aware that the NAO praised the World Service for its improvements in management and performance since 1992? Such improvements are made more difficult by what he omitted to mention in his answer—the operating cash level has been frozen. Therefore, there will be real terms reductions in World Service funding, coupled with the 20 per cent. reduction in capital allocation which was announced yesterday. Does he not realise that a great British asset, which enjoys support throughout the House, is being undermined by demented Treasury accountants? When will his Department more robustly defend this valuable British institution?
    Mr. Rifkind: I have paid no lip service to the BBC World Service. It is a superb service that quite rightly draws support from both sides of the House. I would never do anything to damage the ability of the BBC World Service to remain the premier service of its kind anywhere in the world. The reductions announced yesterday were almost exclusively with regard to capital allocation and were part of a wider Government policy to encourage the financing of capital expenditure through the private finance initiative.
    The hon. Gentleman might like to know that the managing director of the BBC World Service said:
    "We are already looking positively as to how the Private Finance Initiative can be applied to our capital plans and I am hopeful that we can make significant progress".
    The hon. Gentleman should bear that in mind and cheer up.
    Mr. Anderson: Does the Foreign Secretary recall with shame the grave damage done to our national interests overseas in the early 1980s by the slashing of British Council and overseas service budgets? With the 20 per cent. cut in capital expenditure, only a hope that the private sector will make up the shortfall, and with no provision for the knock-on effects of leasing on the capital budget, are we not in danger of repeating that historic mistake?
    Mr. Rifkind: The hon. Gentleman should reflect on the fact that, since 1980, funding for the BBC World Service in real terms—not just in cash terms—is up by 50 per cent. When the hon. Gentleman criticises what the Government announced yesterday, he might bear it in mind that the chairman of the BBC said:
    "We accept that it cannot be seen in isolation from the totality of the Budget."
    The BBC knows perfectly well that when private finance is being used for capital allocation throughout the public sector, it is not unreasonable that it also seeks to cover its capital requirements to a considerable extent in that way. The BBC World Service is prepared to look at the matter positively. Why cannot the hon. Gentleman do so?
    Mr. Harris: Although I welcome and accept much of what my right hon. and learned Friend has said, does he nevertheless accept that a 20 per cent. cut in the capital programme of the World Service means a reduction of £5.4 million? Is he confident that that shortfall can indeed be met by the PFI? If he can assure the House on that point, he will carry most hon. Members with him.
    Mr. Rifkind: My hon. Friend makes a fair point. We are not expecting the BBC World Service to cover all of its capital requirements through the private finance initiative. It will have some £62 million available over the next three years on the basis of the allocations that were announced yesterday. In relation to the proportion for which we are looking to private finance, I can only emphasise that the managing director of the BBC World Service said that he was hopeful that it could make significant progress. It is therefore entirely reasonable for the Government to take the matter forward on that basis.
    Mr. Batiste: What does my right hon. and learned Friend consider the impact will be of the BBC's freedom to operate internationally on a commercial basis in television and multimedia? Is not this a massive market opening up for the BBC, and is not the BBC well placed to take full advantage of it?
    Mr. Rifkind: Yes. I draw particular attention to the BBC Worldwide TV News, which is already available in 43 million homes and in 111 countries. The truth of the matter is that the BBC World Service already attracts more listeners than the world services of all other countries combined. It is the Government's policy to ensure that that remarkable achievement is maintained.
    Mr. Shore: Precisely. The BBC World Service is a great international service and an enormous asset to this country, and what we are talking about is precisely the capital investment which will give it the further audibility and visibility that will enable it to continue to be heard and watched by millions of people overseas. We have no greater asset internationally than the World Service. Does the Foreign Secretary also understand that he is cutting the third year of a triennium of investment? One cannot

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    muck about with a three-year programme at the end of year two and expect people to be able to attract alternative finance in the remaining 12 months. Will the Minister go back and think again about refraining from damaging a great national asset?
    Mr. Rifkind: I respect the right hon. Gentleman's clear and genuine commitment to the BBC World Service. If he is as committed as we are to improving the audibility of the World Service, which I believe he is, he might have paid tribute to the fact that we have a £166 million investment programme to improve the audibility of the BBC World Service. The sum announced yesterday to be achieved through the private finance initiative for next year is £5 million. If the BBC itself is hopeful that that can be done, perhaps the right hon. Gentleman, on reflection, will regret the vehemence with which he put his question.
    Mr. Lester: I am second to none in my support for the Budget in the sense that my right hon. and learned Friend the Chancellor wants to make this country the enterprise centre of Europe. Does my right hon. and learned Friend the Foreign Secretary accept that many of us realise that the diplomatic corps, which the Budget has assisted and reduced, the World Service and the British Council are very much part of Britain's influence in the world, from which our trade flows? Does he accept that some Conservative Members are worried about any damage whatever to that element of the British effort in the wider world?
    Mr. Rifkind: I agree with my hon. Friend. That is why we have protected the operating costs of both the BBC World Service and the British Council from the economies that are being made elsewhere in the public sector. I entirely endorse the objective that my hon. Friend has stated. If we did not take the same view, we would have subjected the operating costs of the BBC and the British Council to cuts. We have not done so. That is an indication of our good faith.
    Sir David Steel: While the Foreign Secretary rightly extols the virtues of the BBC's Worldwide TV News, has he noted the point made in the Lothian lecture this week by Mr. Jon Snow, that withdrawal of that service from access to China and its replacement by Mr. Murdoch's channel was not a good example of British interests being solved by private finance?
    Mr. Rifkind: That is not the private finance initiative to which I referred earlier, as the right hon. Gentleman perfectly well knows. The BBC World Service receives an allocation of about £170 million. It determines its priorities within that and its ability to transmit to individual countries. We wish it well in the work that it does. I have not the slightest reason to believe that any announcements made recently will inhibit the BBC in maintaining its extraordinary achievements of the past 20 years.

    Nigeria
    Mr. Winnick: To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on present relations with the Nigerian rulers. [862]
    Mr. Hanley: As my right hon. and learned Friend said earlier, Nigeria is currently suspended from the Commonwealth. We are acting in conjunction with other Commonwealth countries and our EU and other partners.
    Mr. Winnick: Is it not perfectly clear that the response of the Nigerian rulers to the country's suspension from the Commonwealth has been one of total indifference? Just a few minutes ago, the Minister justified the sanctions against the murderous regime in Iraq, and I understand and appreciate why. Why are we adopting a different attitude towards the murderous regime in Nigeria?
    Mr. Hanley: The two countries are different, their histories are different and the reaction to both has been different. The hon. Gentleman will be well aware that the sanctions imposed on Iraq are UN sanctions, and he will be aware also that we are still working on an effective reaction to what Nigeria has carried out recently. We have a unique arrangement in the Commonwealth to impress on Nigeria the seriousness of its actions, and we will work to do more until Nigeria wakes up to the realities and reforms itself.
    Mr. Ian Bruce: Does my right hon. Friend agree that, in taking action against Nigeria, we must be careful not to take action against the Royal Dutch Shell Company which might result in the Nigerian rulers not having to pay Shell its share of the oil revenues? Does my right hon. Friend also agree that we must not allow the rulers of Nigeria simply to sell the oil on the open market and gain more funds for their terrible regime?
    Mr. Hanley: My hon. Friend is right. We must leave to Shell the actions that Shell should take. I had extensive discussions with the chairman of Shell very recently, as did my right hon. and noble Friend the Minister for Overseas Development. There is little doubt that the project which Shell has now set up will help relieve the abject poverty in Nigeria. All of our projects in Nigeria have a long lead time, and revenues from the gas sales are unlikely to flow until early next century, but to cancel the project now would be to impoverish Nigeria for many years to come.
    Rev. Martin Smyth: Will the Minister confirm, in the light of an earlier response from the Foreign Secretary, that we have not been making direct representations to the Nigerian Government? Does the right hon. Gentleman share the belief of many people in the United Kingdom that we ought to be making representations for the sake of the Nigerians who live among us and because of our concern at the way in which people are being treated in that country?
    Mr. Hanley: I can say to the hon. Gentleman only what my right hon. and learned Friend the Foreign Secretary said earlier. We have noted the calls for the severing of trade links and for an oil embargo, and we are considering a wide range of options with our European Union and other partners. We have not ruled out anything at this stage. An oil embargo could be policed effectively only by a naval blockade of Nigeria, and we are looking to the international community to adopt the measures which we and others have already taken. All of that will maximise the pressure on the Nigerian regime.

    Middle East
    Mr. Carrington: To ask the Secretary of State for Foreign and Commonwealth Affairs what progress is being made towards achieving peace in the middle east. [864]
    Mr. Rifkind: Despite Yitzhak Rabin's tragic death, the peace process is continuing. Shimon Peres' commitment

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    to peace is clear—Israeli troops were redeployed from Jenin on 13 November, six days early. We are also hopeful that there will be progress on the Syrian track.
    Mr. Carrington: In the light of the tragic death of Prime Minister Rabin, will my right hon. and learned Friend impress on the Israeli Government that they need not give concessions to the hardliners in Israel? In particular, will he impress on the Israeli Government the urgent need to stop Jewish settlements being built in Arab Jerusalem?
    Mr. Rifkind: I believe that the Israeli Government themselves are disinclined to make concessions of the kind to which my hon. Friend refers. The new Israeli Prime Minister has emphasised that the pursuit of peace is his single most important priority. He appears to have been developing a good relationship with the Arab Heads of Government around Israel, and he is also thinking positively about trying to get the Syrian-Israeli negotiations moving again.
    Mrs. Jane Kennedy: How much of the international aid pledged to the Palestine National Authority has so far been released? Can the Secretary of State explain what effect the cut in the overseas aid budget that was announced yesterday will have on Britain's ability to keep her promises in that regard?
    Mr. Rifkind: We have committed ourselves to about £83 million-worth of bilateral and multilateral aid to the Palestinians. A lot of that has already been provided. When I was in Gaza recently, I indicated an extra £3 million-worth of aid and do not anticipate any change in those proposals as a result of the announcement yesterday.

    European Intergovernmental Conference
    Mr. Hain: To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on progress made by the reflections group in preparing the agenda for next year's intergovernmental conference. [867]
    Mr. David Davis: I expect the study group to present its final report to the Madrid European Council in December.
    Mr. Hain: Is not one of the greatest threats to Europe and its competitiveness the huge burden of mass unemployment? Should not one of our major objectives be to get Europe back to work? At next year's intergovernmental conference, will the Government therefore support a proposal to amend the treaty on European union to include in its objectives a commitment to full employment?
    Mr. Davis: I noticed that the hon. Gentleman moved from the Whips Bench before he asked his question, and now I can see why. The greatest threat to employment in Europe is Europe's inability to compete. The leader of the Labour party knows that, which is why he made his disingenuous speech to the Confederation of British Industry a little while ago. The right hon. Gentleman was trying to represent Labour policy as the ability to pick and choose between which parts of the social chapter it would take. He ignored the fact that most of the social chapter is decided by qualified majority voting, so he would not have a choice, and that the part that is not decided by such
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    voting would be given over to it by Labour policy. He was trying to put a disingenuous fig leaf in front of the greatest threat to Britain's ability to compete—Labour policy.
    Mr. Wilkinson: Is not the single greatest deficiency in the process of European construction the fact that, for the British people, it does not have popular support? To win back that support, can my hon. Friend say whether the Government will press for restitution of the superiority of British law over European law at the forthcoming intergovernmental conference and, in particular, for the need to do something about the European Court's ability to impose retrospective judgments?
    Mr. Davis: My hon. Friend is certainly right in respect of the need to rebuild popular support for the union. Prior to the intergovernmental conference, we presented to the reflections group of the European Union a paper that tackles that very issue—unpredictable and highly expensive judgments that have major retrospective consequences on Governments who try to carry out European law in good faith, as the British Government always do.
    Mr. Skinner: Just to make sure that everyone understands what has happened since 1971, can we get it on the record that on 28 October of that year the Tory Government took us into the Common Market? In the next decade, Lady Thatcher passed the Single European Act. She forced it through on a guillotine and gagged Tory Members of Parliament who wanted to oppose it—every Labour Member opposed it. Then, in the 1990s, another Tory Government decided to sign the Maastricht treaty. Once again, we opposed it. Let us get it on the record that it is the Tory Government who have got this European issue round the necks of the British people.
    Mr. Davis: The people who have most to worry about as a result of what the hon. Gentleman says are those on the Labour Front Bench. He just condemned them out of his own mouth. Let us get on the record the fact that enlargement of the European Union, the social opt-out, the single market, competitiveness and deregulation and our record on inward investment are all things of which we are proud in our policy on the European Union.
    Mr. Gill: Is it not a fact that the Labour party not only wants to make us uncompetitive by adopting the social chapter, but wants to make us doubly uncompetitive by returning to fixed exchange rates?
    Mr. Davis: My hon. Friend is absolutely right. One of the things which Labour tried to cover up at its party conference was the part of its conference document which said that it would not stand for any permanent opt-outs. That means that, whatever it said about European monetary union, it has decided now that at some point it will join.
    Ms Quin: If, as the Minister claims, European social policies are economically damaging, how is it that several European countries, such as Denmark, Belgium, Luxembourg, Germany and Italy, which accept the social chapter, are not only higher up the Organisation for Economic Co-operation and Development world prosperity league than us but have improved their position since 1979, whereas we have dropped from 13th to 18th?
    Mr. Davis: I am very surprised at the hon. Lady. I should have thought that the Labour party would

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    concern itself first and foremost with employment. When it comes to employment, we are top of the major country league in Europe—above Germany, above France, above Italy and above Spain.

    Trade Development
    Dr. Spink: To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the extent to which his Department has achieved its trade development responsibilities. [868]
    Mr. Hanley: Commercial work is now the Foreign and Commonwealth Office's largest single area of activity overseas, involving 35 per cent. of the time of our front line staff. The volume of UK exports grew by 11 per cent. in 1994 against a 9 per cent. increase in the volume of total world trade. Foreign and Commonwealth Office posts overseas play an important role in helping UK exporters to achieve successes such as these and in helping inward investment.
    Dr. Spink: I am grateful to my right hon. Friend for that answer. Will he continue to ensure that Foreign and Commonwealth Office help is focused on smaller companies that want to break into export markets and that major companies are helped because they create so many new jobs for Britain?
    Mr. Hanley: I thoroughly agree with my hon. Friend. The competitiveness White Paper stated that 100,000 UK companies export, and we set a target of 30,000 new companies joining world exporters by 2000. The majority of those 30,000 companies are bound to be small and medium-sized enterprises. The Foreign Office, through our commercial staff overseas, devotes much of its time to providing market information and contacts to small and medium-sized enterprises—SMEs—which they could not obtain nearly as cost-effectively anywhere else. Around 60 per cent. of companies that take part in outward trade missions that are supported by our posts overseas are smaller companies, so I am pleased that my hon. Friend takes such a great interest in this matter. Our SMEs are benefiting from the help that the Foreign and Commonwealth Office can give them.
    Mr. Campbell-Savours: Do not our trade development responsibilities include making representations to the American Government about the conduct of the Campbell Soups company from Campbell, New Jersey, which closed down a highly profitable manufacturing plant in my constituency? Will the Minister join me in asking the British people to boycott the products of that company throughout the country so that it learns the lesson that it cannot treat our people like rubbish, as it is at the moment?
    Mr. Hanley: I not only watched the hon. Gentleman's Adjournment debate on the subject of Campbell Soups, but read it afterwards. I was interested by what he had to say, but it is not part of my responsibility to make representations to the United States on that matter.
    Sir Roger Moate: Does my right hon. Friend agree that great opportunities exist for trade and development in the idea of the transatlantic free trade area, encompassing an enlarged European Community, the countries of the European economic area and the north American free trade area, which is so strongly supported already by my
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    right hon. and learned Friend the Foreign Secretary and the Government? Can my right hon. Friend say when practical negotiations might start and confirm that, even though the negotiations might be conducted by the European Community, Britain will have a significant role in such negotiations?
    Mr. Hanley: I thank my hon. Friend for that question. The EU-US summit will deal with that matter. I agree with my right hon. and learned Friend the Foreign Secretary who, as he has said so firmly in recent speeches, is totally committed—as are Her Majesty's Government—on this matter.

    Israel
    Mrs. Roche: To ask the Secretary of State for Foreign and Commonwealth Affairs when he last met representatives of the Israeli Government; and if he will make a statement. [869]
    Mr. Hanley: My right hon. and learned Friend the Foreign Secretary met Shimon Peres in Israel on 9 November. They discussed the middle east peace process, following the assassination of Yitzhak Rabin. Shimon Peres reiterated his commitment to continue to work for peace and he has, of course, our full support.
    Mrs. Roche: I thank the Minister for that reply. Perhaps I may press him a little further about the peace accord with Syria. In response to an earlier question, the Foreign Secretary mentioned progress with the peace accord with Syria. Will the Minister give us some indication of how matters are progressing? Does he agree that a comprehensive peace accord, which covered Syria, in the middle east would be the greatest tribute that could be paid to the memory of Yitzhak Rabin?
    Mr. Hanley: I agree with the hon. Lady. My right hon. and learned Friend spoke to the Syrian Foreign Minister yesterday in Barcelona and he spoke with President Assad in Damascus immediately after Mr. Rabin's funeral. The signs are better than they have been for some time that the Syrian track will be reconvened. More countries than ever before are expressing their good will and I hope that the events to which the hon. Lady referred will come to pass.
    Mr. Hawkins: Does my right hon. Friend agree that it is a positive sign that, following the tragic assassination of President Rabin, leaders of Arab states who had never visited Jerusalem travelled there to attend his funeral? That should encourage the progress of the peace process, which is greatly welcomed.
    Mr. Hanley: My hon. Friend is absolutely right. He has put his finger on one of the reasons why many people are now more hopeful about the peace process. The visits to Jerusalem by King Hussein of Jordan and representatives of the states of Oman and Morocco show that the Arab world wants as much as Israel and its immediate neighbours to see peace.
    Mr. Gunnell: I am sure that, following his meeting on 9 November, the Foreign Secretary congratulated the Israeli Government on their early withdrawal of the troops to which he has referred already. Does the Minister agree that, if the elections to the Palestine National Assembly on 20 January are to be free and fair, it is very important

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    that they do not take place in the presence of occupying troops? Will the Government therefore do everything possible to encourage the Israeli Government to speed up the process of withdrawal so that the elections can take place in a constructive atmosphere?
    Mr. Hanley: Yes. I can confirm that the British Government are committed to the success of the Palestinian elections. The withdrawal of the forces that the hon. Gentleman mentioned is extremely important. The elections are due to take place on 20 January, as agreed by the Palestine National Authority and the Israeli Government, and the European Union co-ordinating international observer group will be present. Four of the 30 staff in the co-ordinating unit are British and Britain is providing major input to the core of observers. Six long-term observers arrived on 9 November and are advising the Palestinians about policing the elections. I am grateful for the hon. Gentleman's question and for the good will that it implies.

    India
    Mr. Merchant: To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to visit India to discuss the United Kingdom's relations with India. [870]
    Mr. Hanley: My right hon. and learned Friend the Foreign Secretary had extensive discussions with the Indian Foreign Minister, Mr. Mukherjee, last week. He hopes to find an early opportunity to visit India, as I did last month.
    Mr. Merchant: In view of the current unstable situation in Kashmir, will my right hon. Friend update the House on the situation with regard to the four hostages—two of whom are British—who are at present in the hands of political extremists?
    Mr. Hanley: I am grateful to my hon. Friend for his concern. I am sure that all right hon. and hon. Members want the four hostages to be released as soon as possible. We have no further news about them at the moment. We are grateful to the Indian Government and to their various authorities which are helping to try to secure the release of the hostages.
    Representatives of the group of four nations—our high commissioner and the American, German and Norwegian ambassadors—are working very hard and very well together to try to secure the release of the hostages. This morning I saw a report on Teletext that one of the hostages is ill. If a hostage is unwell—we have no proof that that is the case—the best thing that the hostage-takers can do is release him. The four hostages should be released now. No purpose is served by their continued captivity and, in the name of humanity, they should be set free.
    Mr. Pike: It is clear that everyone accepts that the release of the hostages is essential and that keeping them plays no part in helping to end the position in Kashmir. Will the Minister ensure that the Indian Government are aware that people in this country believe that the Indian Government should be the first ones to take steps to end that long-standing problem? That might be of tremendous benefit, not only to India but to Pakistan and the whole of that part of the world.
    Mr. Hanley: We believe that the best way to make progress on Kashmir would be a combination of three
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    main factors: first, simultaneous progress on dialogue between India and Pakistan, as provided for under the 1972 Simla agreement; secondly, an improvement in human rights in Kashmir and a genuine political process there; thirdly, a clear cessation of external support for violence in Kashmir.
    While we are talking about the hostages, I pay tribute to their courage and the courage of their families, who have been remarkable under intense pressure.
    Lady Olga Maitland: What response has my right hon. Friend had from the Indian Government to his efforts to persuade them to improve their relations with Pakistan? Is he aware that, because relations are poor, tensions are high and Pakistan is being pushed to spend a disproportionate amount of its resources on the armed services?
    Mr. Hanley: I agree with my hon. Friend that nations tend to spend far more than they need to on building up their armed forces because of bad relations with their neighbours. This is a classic case in point.
    We urge both India and Pakistan to resume a dialogue on bilateral matters, not least on Kashmir. Indeed, my right hon. and learned Friend the Foreign Secretary, in discussion with the Indian Foreign Minister, did exactly that. I hope that the whole House—Members of good will—will urge their individual contacts with the Pakistan and Indian Governments to discuss between themselves if that is the only way to achieve peace.

    Nigeria
    Mr. Pope: To ask the Secretary of State for Foreign and Commonwealth Affairs when he next plans to meet representatives of the Nigerian Government to discuss the situation in Nigeria. [872]
    Mr. Hanley: We have no such plans.
    Mr. Pope: Does the Minister accept that, if the British Government's arms and visa sanctions against the brutal Nigerian regime had been even remotely successful, there would have been no need to come back and announce further measures? Will he give the House an assurance that the visa controls currently in place regarding Nigeria will, at the very least, ensure that members of the brutal, vicious Nigerian Government are not allowed to enter or re-enter the United Kingdom?
    Mr. Hanley: Under the present immigration rules, it has not been possible to cancel or revoke existing visas, but the Home Office has been notified of the EU decision and all members of the Nigerian provisional ruling and federal ruling council will now be refused entry to the United Kingdom even if they hold valid multiple entry visas issued before the new EU restrictions were agreed. I am sure that that comes as a comfort to the hon. Gentleman and other hon. Members.

    Hong Kong
    Mr. Soley: To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the progress being made in negotiations with China on Hong Kong. [874]
    Mr. Hanley: We have reached several important agreements with the Chinese in recent months which are

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    very much in Hong Kong's interest, but much work remains to be done to ensure a successful transition for Hong Kong, which I believe all of us, including the Chinese, want.
    Mr. Soley: Is the Minister satisfied that the Chinese Government and the leaders of the business community on both sides of the border recognise that, if the elected legislature were removed in 1997 and replaced only with members who had the approval of Beijing, enormous damage would be done to political and economic confidence in Hong Kong?
    Mr. Hanley: I agree with the hon. Gentleman that it is vital to maintain confidence in Hong Kong. Members of the business community have impressed on me the fact that confidence is vital for their continued interests.
    We are doing everything that we can to ensure that the business community feels comfortable with what we are doing. Indeed, the business community welcomes the continuing agreements that we are making with the Chinese. The Chinese, for their part, recognise that Hong Kong is responsible for about 25 per cent. of their gross domestic product. Hong Kong and the business links between the two countries are important to China as well as to our continuing interest in the region.
    I therefore agree with the hon. Gentleman.

    Middle East Peace Process
    Mr. Hawkins: To ask the Secretary of State for Foreign and Commonwealth Affairs what assistance Her Majesty's Government are giving to the peace process in the middle east. [876]
    Mr. Hanley: The £83 million of aid to the Palestinians has already been mentioned.
    On his recent visit, my hon. and learned Friend the Foreign Secretary encouraged the Palestinians and Israelis to maintain progress on the Palestinian track. He also urged Syria and the Israelis to press forward in their negotiations, and encouraged all the countries of the region to support the peace process—as did I during my recent visit to the Gulf.
    Mr. Hawkins: I thank my right hon. Friend for that helpful answer. Does he agree that it is crucial to keep in touch with all the leaders of the most moderate Arab states to ensure that they are encouraged to continue their dialogue in all the tracks of the continuing peace process with the Israeli Government?
    Mr. Hanley: I strongly agree with my hon. Friend. Indeed, I believe that the reaction of the Arab nations to the tragic assassination of Yitzhak Rabin is one of the developments that give us the most hope that the peace process will now accelerate. We hope that Mr. Rabin's tragic death will not have been in vain.

Northern Ireland
3.30 pm
The Prime Minister (Mr. John Major): With permission, Madam Speaker, I will make a statement about Northern Ireland.
Yesterday evening, the Irish Prime Minister and I met at Downing street to launch a new initiative in the Northern Ireland peace process. A copy of our joint communiqué has been placed in the Library of the House.
In the 15 months since the first of the two ceasefires, there has been a dramatic improvement in the daily life of people in Northern Ireland. They have enjoyed the freedom to go about their daily business without fear of terrorist attacks. Many new jobs have been created. Much new investment has arrived. New opportunities have opened for people of all ages.
We have responded positively—following advice from the Chief Constable and the GOC—to the much reduced threat to security. By the end of this year, half the Army's emergency or roulement battalions will have left Northern Ireland. Security infrastructure has been dismantled. Remission rates for scheduled offenders have been returned to their pre-1989 levels.
Although we have a ceasefire, however, we are still far from a comprehensive political settlement. To work towards that, we must establish a negotiating process that is open to all democratic parties, and embraces all democratic parties. That aim underlies the twin-track initiative that we have now launched with the Irish Government. The first of the two tracks in the joint communiqué will involve invitations to the parties to intensive preparatory talks.
These are not substantive negotiations on Northern Ireland's constitutional future; they are designed to prepare for such negotiations in the future. There are many issues to be resolved if substantive negotiations are to take place successfully. The preparatory talks will consider the best structure and format for all-party negotiations, and how those negotiations can address all the relevant relationships in an interlocking three-stranded process. Several of the parties in Northern Ireland have suggested that an elected body could play an important part in all-party negotiations. Other parties disagree. As the communiqué makes clear, this is an idea that will be discussed in the preparatory talks.
As I have indicated, meeting the requirements of paragraph 10 of the Downing street declaration will be an essential condition for any party claiming a seat at the all-party negotiations. Not all the parties yet do so. That too will be a valid subject for discussion in the preparatory talks.
The format for those talks is intentionally flexible and permissive. We shall build on the exchanges and bilateral contacts that have already taken place. We shall treat each party equally. Exchanges can be bilateral or—where the parties so wish, and where it will further the objectives of the preparatory talks—they could be multilateral.
This new round of preparatory talks is an opportunity for each of the parties in Northern Ireland to express its view, in whatever format it chooses, on the best way of moving the political process forward. It is an opportunity
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for them to work together with one or other or both Governments, according to their wishes. It is an opportunity to generate fresh momentum. It threatens no one, no interest and no party. I hope that all the parties, each in their own way, will take advantage of this opportunity. The objective of moving towards a just and comprehensive settlement will be of benefit to all.
Let me turn now to the decommissioning of the weapons and explosives held in large number by paramilitary organisations linked to political parties in Northern Ireland. Before the Downing street declaration and the ceasefire, we recognised that the need to address this question was one of the practical consequences that had to follow the ending of violence. In a democratic society, political parties cannot be linked to private armies. In a society where parties are committed exclusively to peaceful methods, there can be no need and no justification for holding illegal weapons and illegal explosives. In a democracy, parties and Governments cannot be expected to negotiate under the duress of an implicit threat of a return to violence.
For that reason, we have throughout this year sought to engage the representatives of both Sinn Fein and the loyalist paramilitaries in an exploratory dialogue on how their weapons will be taken out of commission. In order to achieve more progress in that area, we have now agreed with the Irish Government to establish an international body to provide an independent assessment of the decommissioning issue and have given it specific tasks. It will consist of three members under the chairmanship of Senator George Mitchell from the United States. They will act in a personal capacity and on an advisory basis.
The body has been asked to identify and advise on a suitable and acceptable method for full and verifiable decommissioning and also to report whether there is a clear commitment on the part of those in possession of such arms to work constructively to achieve that. We expect it to invite relevant parties to submit their analysis of matters relevant to the decommissioning issue. The Governments are not setting limits to the scope of the submissions that may be made to it. It will be for the international body, in reaching conclusions within its remit, to consider such evidence on its merits.
We will not be asking the international body to question the Government's position on what has become known as the third Washington criterion. It has not been established to make recommendations on when decommissioning should start. That is a matter for governmental decision; and, as I have indicated, it is properly a matter for discussion in the preparatory talks. To avoid any doubt, let me stress that the Government stand by the three criteria on decommissioning, which my right hon. and learned Friend the Secretary of State for Northern Ireland set out in Washington earlier this year. We cannot see a way of securing the necessary confidence to bring all parties to the negotiating table without a start being made to the decommissioning of illegal arms.
This is not a matter of dogma; it is a matter of practicality. It goes without saying that we, like the Irish Government, will consider constructively any practical suggestions that could help bring all parties into negotiations on the basis of the Downing street declaration.
It is no secret that yesterday's agreement between the two Governments required long and difficult negotiations. The British and Irish Governments agree on the need for

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disarmament by the paramilitary organisations, but we do have an acknowledged difference of opinion about its timing. We have decided not to allow that difference of opinion to stand in the way of forward movement along these twin tracks. That is a measure of our determination to continue working together in the future as we have done in the past.
We have asked the international body to report by the middle of January. We hope that progress on both tracks will then enable the two Governments to launch all-party negotiations by the end of February. That is our firm aim. I am confident that it is attainable, but it will require a serious commitment by all concerned. We are ready to make that commitment. But let me make a crucial point. The British and Irish Governments cannot themselves make peace in Northern Ireland. Our role in the process is to facilitate the making of that peace.
We have borne a great deal of the burden. We have been ready to take risks for peace. Now is the time for others to do the same. Now is the time for all parties and all groups to make a sincere and constructive contribution; for the paramilitaries on both sides to give not merely qualified verbal assurances, but a real and tangible commitment to peace. If they mean peace, they do not need guns and semtex. Now is the time for all the political parties to enter the preparatory talks, not with rigid and irreconcilable positions, but with the will to make them work. Ultimately a lasting and peaceful settlement is in their hands and not mine. I hope that they will all have the courage and the wisdom to grasp it.
Mr. Tony Blair: For reasons that you, Madam Speaker, and the Prime Minister know, I have to leave straight after the Prime Minister has responded to me. I hope that the House will not treat that as a discourtesy.
I welcome the statement the Prime Minister has made. We know that progress has been tough over the past few months and both he and the Taoiseach and their array of advisers deserve credit for their perseverance and dedication.
Can I be sure that I have accurately understood the status of both the preparatory talks and the establishment of the international body on arms decommissioning? I understand that the preparatory talks will be bilateral or multilateral. They are designed to facilitate the all-party talks and will involve all parties, but will not in themselves be negotiations on the substantive constitutional issues. The international body similarly will advise on the issues connected with decommissioning, but will not deal with the question of whether arms are decommissioned prior to all-party talks. Therefore, both the preparatory talks and the international body are, in a sense, designed to create a mood and momentum by which the all-party talks can take place.
May I express our support for the view that, for those all-party talks to take place, there has to be full trust and confidence that each party in those talks will abide by and accept exclusively the democratic path? Trust is the key. There can be no threat, implicit or explicit, of any return to violence by any party if such talks are to be successful.
Will the Prime Minister acknowledge that this agreement, although of course it does not resolve the problem of decommissioning, produces a mechanism by
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which the question can be discussed? There is a heavy obligation on all those who say that they want peace to prove it by engaging in this process and providing solutions to the outstanding problems.
Will the Prime Minister tell the House how the preparatory dialogue will operate? In particular, how will the two Governments be involved and when does he expect the first meetings to take place?
The Prime Minister mentioned the idea of an elected body playing some part in this process. Can he tell us how he would envisage the possibility of such a body becoming part of the peace process? What would be the timing of establishing such a body and, in particular, what would be its role in relation to the all-party negotiations that the two Governments hope to establish?
We essentially agree with what the Prime Minister has done today, and we welcome the framework that has been set out. It is not a solution, but it may provide a bridge to a solution. In constructing that bridge, the Irish and United Kingdom Governments should know that they will have the whole-hearted support and good wishes of all decent people in the United Kingdom and the Republic of Ireland.
For 15 months, although unacceptable violence of a sectarian nature still continues, there has been without doubt a transformation in the lives of the people of Northern Ireland. Their liberation from the bomb and the bullet has brought new hope and the chance of renewed prosperity. Peace is now too precious to squander. The duty lies on all parties to make this process work. From the outset, the Labour party has regarded this issue as transcending party politics. We have supported the Government in their search for peace because we believe it to be right. We have worked with the Government and will continue to do so.
The Prime Minister: I am grateful to the right hon. Gentleman for his comments and his consistent support. I am also grateful to him for explaining to me his impeccable reason for needing to leave the Chamber during the course of this statement. I fully understand that that is unavoidable.
I join the right hon. Gentleman in the tribute that he paid to the Taoiseach. The Taoiseach has shown great courage and persistence, and I much admire what he has done. We have not invariably agreed on every matter, and all our discussions have not been easy, but I have found him an honest and straightforward man with whom to do business and I believe that, between us, we have made progress.
The right hon. Gentleman's characterisation of the preparatory talks and the decommissioning body was correct and I shall not reiterate the points that he put. They were certainly right. He raised a number of specific questions about the preparatory talks: how the Governments will he involved; and when they will start. We have set ourselves ambitious targets. We shall need to make a start on both tracks within a matter of days and we shall seek to do so. I hope that each Government will issue invitations to preparatory talks very soon. The starting point will obviously be existing exchanges and bilateral contacts, but we shall encourage other formats for meetings where the parties believe that they might further the objective of securing agreement.

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This will be an intensive process. The two Governments have set out a way forward, but, as the right hon. Gentleman intimated, it requires the co-operation of all the parties in the tracks if we are to achieve real progress towards the targets that we have set ourselves. The right hon. Gentleman also asked about the role of an elected body and whether that could play a part in the negotiating process. Certainly it will. That is one of the propositions for serious consideration in the preparatory talks.
Both the Unionist parties represented in the House have put forward interesting and constructive proposals. They are not the same but they are both worthy of careful consideration by all the parties with an open mind, and we shall endeavour to ensure that that is precisely what they receive. The key to this, as to so much else in this process, is what will give the parties the confidence to come together for substantive political negotiations. If an elected body can play a part in that—one can certainly see circumstances in which that could be the case—it should be looked at very hard and it most certainly will be in the preparatory talks in the weeks ahead.
Mr. Tom King: Is my right hon. Friend aware that there are obvious fears about the significant risks that are being taken in the initiative that he has announced and agreed with the Taoiseach? Is he also aware that there were even more significant risks in allowing the logjam to continue and no progress to be made? In that respect, will he accept the strong support, as echoed by the Leader of the Opposition, for the view that there is no prospect of all-party talks of any value and meaning unless there is confidence between the parties? It is therefore essential that Sinn Fein-IRA and other paramilitaries recognise the challenge that they will face in a matter of weeks—I understand that the commission is to report by the middle of January—and that they give clear evidence and conviction to all those concerned that they are genuine about becoming non-violent democratic parties and are prepared to embark on the decommissioning of arms.
The Prime Minister: I am grateful to my right hon. Friend. I share his judgment about the relative balance of risk between proceeding as we propose and not having proceeded at all. I believe that we have made the right judgment. No progress in this affair is without risk and it could never have been without risk.
I share the view that my right hon. Friend set out. The key to progress is to establish proper confidence between the parties, and all those who propose to take part in the negotiations must be set upon a secure democratic future. This is not a new condition or proposition. It was set out clearly in paragraph 10 of the joint declaration when we embarked on this whole affair and it remains as relevant and important today as it was on the day when we first agreed it.
Mr. Paddy Ashdown: I am happy to welcome and support the Prime Minister's statement and the joint communiqué on which it was based which was issued last night. This is not a breakthrough. The bottom line problems remain to be resolved, but it returns momentum to the peace process and provides a time frame and a structure within which those problems can be resolved. That may not be very tidy, but it is sensible and good politics.
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We are now less than three weeks away from the anniversary of the publication of the foundation document. The Prime Minister will no doubt agree that the only rock on which that document and the peace process can be founded is absolute unanimity of purpose and action on the part of the British and Irish Governments. Perhaps he will confirm that in the process that he sees ahead, we shall overcome the disagreements and divergences that have perhaps taken some momentum from the peace process over the past few weeks.
On the role of an elected assembly, we support the Government's position that talks cannot take place between all parties until the process of decommissioning has started because that is the clear indication that all parties have committed themselves exclusively to the democratic process. But does The Prime Minister agree that the establishment of an elected assembly may have a role in that as well, and that in this matter the Irish Government may have a role to play in encouraging those who have so far been reluctant to take part in that to do so?
Finally, the Prime Minister said that within the next two or three days invitations will be issued to the parties for the exploratory talks. May we take it that that means that he sees those talks starting in a week or so—at all events before Christmas?
The Prime Minister: I am grateful to the right hon. Gentleman. The answer to his last point is yes. I certainly see the talks starting as speedily as we can manage and invitations being issued within a few days. I hope that all those who receive those invitations will both join in those talks and join in them at senior decision-making level within their parties because that is important.
The right hon. Gentleman is right that there is a balance of advantage, a very clear balance of advantage, in working with the Irish Government. We do not agree on every aspect; both the Taoiseach and I would state that quite plainly. There is no doubt that there is a different perspective on some of the matters that we have been discussing, but the prospects for success are infinitely greater if the two Governments can continue to work together in this process rather than apart. There were efforts during the past few months by some of the parties involved to seek to provoke differences and breaks between the two Governments. We are well aware of the number of occasions on which they tried to do that and we have resisted.
I am grateful to the right hon. Gentleman for what he said about decommissioning. As I said a moment ago, that was set out in the Downing street declaration. It is not a matter of dogma but of practicalities. No one has yet found an alternative way of providing confidence. The hon. Member for Upper Bann (Mr. Trimble) once said that if there were other ways, of course one could look at them. But no one has yet provided another way. We shall wait to see whether one is provided. As for an elected assembly, I do not need to reiterate what the right hon. Gentleman said: I agree with it.
Mr. Andrew Hunter: In warmly welcoming yesterday's communiqué and my right hon. Friend's statement, may I ask him to confirm that the international body will be purely advisory, that it will have no executive role and that both Governments will be free to respond to its suggestions in the way that they wish?
The Prime Minister: Yes, I can confirm all my hon. Friend's points. It will have an advisory, not an executive

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role. Of course we shall listen carefully to what it has to say and both Governments will consider its recommendations, but, ultimately, it is for the British Government to take decisions on matters affecting Northern Ireland and for the British and Irish Governments to take decisions jointly on matters that are of joint interest to north and south and between the United Kingdom and the Republic of Ireland. I believe that the international body, although advisory, will have a very valuable role to play.
Mr. David Trimble: I note that the communiqué that was issued last night is in its essentials identical to the one that would have been issued at the beginning of September if the Irish Government had not given way to IRA threats at that time. In his statement the Prime Minister referred to paragraph 10 of the Downing street declaration and said that meeting the requirements of paragraph 10 are an essential condition. He will know that one of those requirements is the need to establish a commitment through exclusively peaceful means. I welcome what he said in the statement with regard to the decommissioning requirement and I welcome that clear restatement of the Government's position, but does he agree that there is also stated in paragraph 10 of the Downing street declaration a need for parties moving into all-party talks to have a democratic mandate and to show a willingness to abide by the democratic process? Does he agree that that mandate can be obtained, and that willingness to abide by the democratic process can be shown, only by the parties submitting themselves to an election and showing a willingness to participate in an elected body, and that, therefore, the sooner we have such an election and such a body, out of which negotiations can subsequently be developed, the better?
The Prime Minister: There is a great similarity between the agreement that would have been reached in September and the communiqué that was issued last evening. One difference of course between the two, as the hon. Gentleman will know, is that the communiqué issued yesterday was far more detailed in its content than the relatively brief communiqué that was still-born in September. To that effect, the time that has been lost has not been wholly lost because we have made some progress in the detail of the matters.
The hon. Gentleman quotes paragraph 10 correctly and that is, of course, one of the ways in which parties may achieve a democratic mandate. We said clearly in paragraph 10 that
"democratically mandated parties which establish a commitment to exclusively peaceful methods and which have shown that they abide by the democratic process, are free to participate fully in democratic politics".
That has been our guiding position from the outset and it remains so.
Mr. Peter Robinson: Does the Prime Minister accept that my colleagues and I have always been willing to meet him and to express our views on how political progress can be made and that we shall continue to do that, but that we are not prepared to be included in a process in which Sinn Fein-IRA plays a part while it still holds on to its semtex and weapons?
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Will the Prime Minister explain to us how it is fair and just in paragraph 4 of the communiqué that constitutional and legitimate political parties should be treated on an equal basis to a political group that is a support organisation for a terrorist organisation, which, in turn, still holds on to its weaponry? Will the Prime Minister explain in relation to paragraph 3 what the term "widespread agreement" in that context is intended to convey? Is it possible for a talks process to begin without the support of all the Northern Ireland political parties?
The Prime Minister: We certainly seek as broad as possible participation and I hope that we can have universal participation. That would certainly be the best guiding star to achieving a satisfactory outcome and I hope that the hon. Gentleman and his party, who represent a great deal of important opinion in Northern Ireland, will play a constructive role. They have an important role to play. The proposals that he and his hon. Friend the Member for North Antrim (Rev. Ian Paisley) brought to me recently were constructive. The hon. Member for Belfast, East (Mr. Robinson) will see the echo of them in the reference to an elected assembly in the communiqué that was issued yesterday. I should like to continue that constructive approach and I hope that he and his party will contribute to these discussions at a senior decision-making level.
As the hon. Gentleman knows, we are seeking the prospect of a proper dialogue for peace, but there is a dilemma for the two Governments in that respect: we cannot ensure that dialogue ourselves. We can only encourage it. The hon. Gentleman and other hon. Gentlemen with political responsibility for parties in Northern Ireland can deliver it and I very much hope that they will do so. They can help to ensure peace or they can help to prevent peace. I very much hope that they will work to ensure it.
As we have seen in the sad history of Northern Ireland, it is very easy to prevent peace. All that is necessary is to play to the old script, stand on the sidelines and play on the old fears and there will be no lasting peace. We know that that is the case. The history of Ireland has sadly told us that, but there is an alternative: if the people of Northern Ireland, who have shown great courage, can find a similar courage in all their political leaders—courage and determination to banish the old enmities—then, in joining in these discussions, those leaders can provide a more secure future for Northern Ireland than it has ever known in the past. That is a very great prize. It is a prize that is worth examining very carefully. It is worth examining all the options, including the option of deciding to engage in these preparatory talks.
The hon. Gentleman set out correctly what is necessary before one can move to what one might call the mainstream constitutional talks. We are here talking about the preparatory talks, and I hope that he and his party will show the same constructive spirit as they showed when they called upon me recently in Downing street, and will join in the talks, for the sake of the contribution that they can bring to making them a success.
Mr. Clive Soley: Will the Prime Minister accept that we should not take the present ceasefire for granted? That is why the talks last night were so welcome, because they prevented the ceasefire from beginning to fray at the edges, as some of us feared that it might, given that there are always a few people who would like to return to violence. More importantly, will the right hon. Gentleman confirm that the British and Irish people expect the parties to participate in the preparatory talks, and that failure to do so would cause enormous damage to the communities that they represent in Northern Ireland?
The Prime Minister: I am grateful to the hon. Gentleman for what he has said. Certainly it is not wise to take the ceasefire for granted. One illustration of the extent to which that is true is that although, mercifully, we have had 15 months free of bombings and murder, emphatically we have not had 15 months free of crime and thuggery. Day after day, on both sides, punishment beatings have occurred, and people utterly defying the normal rule of law have taken it upon themselves to enter homes and break them up with baseball bats, and to break the arms and legs of teenagers with baseball bats for not toeing what those people thought was the appropriate party line in their particular part of Northern Ireland. That is not peace as I understand it, and it provides an illustration of the dangers that lie there.
There is one other relevant point: if the parties that have not been bombing and killing over the past 15 months are genuine in what they have repeatedly said since we lifted the broadcasting ban and enabled them to speak directly to the world, the peace that they seek is permanent. If that is true, there can be no question of going back to guns and bombs. In the future we shall find out whether, when they talked of peace over the past months, they were speaking the truth, or whether they were not. I hope that it will turn out that they were. Time alone will tell.
Mr. James Couchman: May I join others in congratulating my right hon. Friend and the Taoiseach and all who have worked towards this welcome progress? The international body is to be given a substantial task, and a formidably short time in which to do it. My right hon. Friend has named the chairman of the international body; can he say when he expects to be able to tell us the names of the other people serving on it?
The Prime Minister: I hope that we shall be able to announce the other two names speedily—I hope that one will be Canadian and the other Nordic. We are going through the final processes now and, as soon as those names are confirmed, and agreed by their Governments, I shall make them public.
Mr. Dennis Canavan: Does the Prime Minister now agree that to make total or even partial arms decommissioning a precondition for all-party talks is rather impractical, because arms handed over today could be replaced tomorrow? And will he therefore pursue more vigorously the twin-track approach, with a firm starting date for all-party inclusive talks, which would help to find an agreed new constitutional settlement, as well as helping to bring about the total arms decommissioning that we all want to see?
The Prime Minister: The hon. Gentleman is right that the ultimate prize is complete decommissioning, not the
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partial decommissioning that we seek before we get to all-party talks. The problem is a practical one. Unless there is some partial decommissioning there is unlikely to be confidence among the other political parties that Sinn Fein is committed permanently to peace, and we cannot have all-party negotiations unless all parties are prepared to sit down and talk together. The reality of life is that, without something that will engender confidence—[Interruption.] The only thing that we have been able to identify is a decommissioning of some of the arms. If there is an alternative, it has not yet been produced. If it is produced, of course any sensible person would look at it. But it has not yet been produced and we have not been able to conceive what it might be. It is a practical problem, not a dogmatic problem. I hope that that point will be understood by those who have the arms and could decommission a portion of them to try to engender the confidence to ensure that those all-party talks can then take place.
Mr. David Wilshire: May I congratulate my right hon. Friend on his perseverance and wish him well with his future endeavours in the matter? Does he accept that a considerable number of Conservative Members believe that it is absolutely crucial that we put beyond all doubt and misunderstanding the central issue of decommissioning? Will he therefore confirm that there is absolutely no question whatever of the Government agreeing to enter into all-party talks before a start has been made on decommissioning?
The Prime Minister: I have indicated to my hon. Friend several times this afternoon that that is the Government's position. More relevantly, it is not only the Government's position. We must make that clear. It is the position of the parties who would be party to the talks. That is the real point. The parties would have to sit down together.
A number of the parties take the view, and I myself would not question that view—it is absolutely understandable—that they would not have confidence to sit down with Sinn Fein until they have a greater indication that Sinn Fein is prepared to disarm. That is the substantive point. It was implicit in the Downing street declaration mentioned earlier. It has been implicit ever since. My right hon. and learned Friend the Secretary of State for Northern Ireland set it out in the three Washington conditions, the third of which is the one to which my hon. Friend refers. That remains the Government's position.
Mr. Kevin McNamara: Is the Prime Minister aware that all people in these islands will be congratulating him and the Taoiseach on having overcome some considerable difficulties and differences of opinion in achieving the communiqué yesterday? It is greatly welcomed. Will he answer two points? First, in talking about the three interlocking agreements, can he confirm that the principle that nothing is agreed until everything is agreed still stands? In relation to confidence-building measures, will he confirm that the proposal of an elected assembly may in itself cause a lack of confidence in other participants, bearing in mind, as they do, the fact that the result is a foregone conclusion,

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that the constituency itself was drawn up to give that particular electoral conclusion and that they have unhappy memories of Stormont and of the conventions?
The Prime Minister: That is of course a proper matter for discussion. But there is one thing that I hope that we will be able to do. Time after time in the history of Northern Ireland an opportunity to progress in one form or another has been pushed aside because something similar was tried at some stage in the past and did not succeed. The hon. Gentleman is right in saying that the assembly route was tried in the past and did not succeed. But that was in a different time and in different circumstances. That is not to say that it would not succeed on this particular occasion.
I am saying to all the parties that I hope that they will stand back and consider whether it is possible to put some of those old shibboleths to one side and decide in the circumstances of 1995, on the back of the talks that have taken place, on the back of the changed situation that exists in the everyday life of people in Northern Ireland, in the understanding that this may be a chance that may not readily be repeated in the years ahead if it slips away from us, and when everyone should be prepared to go to the limit of what is tolerable for them and their view, to see if we can reach a communal settlement.
In that sense, I ask the hon. Gentleman not to rule out instinctively the question of going down the route of an elected body. One of the proposals is that there should be an elected body—not to govern Northern Ireland, but from which a negotiating team with a proper mandate to negotiate the future is drawn.
Negotiating those constitutional points will not be easy. I am open-minded about how those constitutional talks come about, but I can see the advantage that some of the political parties in this House see in having an elected assembly—not to govern Northern Ireland but to produce nominees from that assembly to negotiate constitutional matters for Northern Ireland. I hope that that matter will not be pushed aside by anyone in these preliminary conversations.
Mr. Richard Spring: I congratulate my right hon. Friend the Prime Minister and my right hon. and learned Friend the Secretary of State for Northern Ireland on so assiduously seeking a resolution of the problems in Northern Ireland. Does my right hon. Friend the Prime Minister agree that a democratically elected body in Northern Ireland could be entirely consistent with the often expressed commitment of the Government not to seek to impose solutions on the Province?
The Prime Minister: My hon. Friend is quite right; it would be consistent. That is legitimately one of the matters for discussion in the preparatory talks and thereafter. The fact of the matter is that the possibility of imposing solutions is more apparent than real. One cannot impose a solution that is not acceptable to the people generally. We need to reach agreement on those issues, and that is why it is so important that the discussions between all parties take place.
Mr. Robert McCartney: Does the Prime Minister agree that, although the issue of
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decommissioning has been firmly put in place by his statement today, Sinn Fein will not be admitted to substantive negotiations until it has physically commenced decommissioning? There is of course a more significant point, and that is the whole issue of consent. It seems to me—I am sure that the Prime Minister will agree—that the whole basis of the Downing street declaration was that the principle of consent, which is consent by the greater number of people in Northern Ireland, should rule any agreement. Does the Prime Minister therefore confirm that Sinn Fein will not be admitted to any substantive negotiations until it has unequivocally accepted the principle of consent as a basis for discussion?
The Prime Minister: As the hon. and learned Gentleman knows, Sinn Fein cannot be admitted to talks with other parties until the other parties are prepared to talk to it. Therefore, the principle of consent, in that respect, lies in the hands of all the parties. There is a bigger issue on the subject of consent, and it is one that I sought to deal with some months ago. I have made it clear, and I happily reiterate it this afternoon, that if we are able to get through the preparatory talks and then move into all-party talks, and if those all-party talks reach an agreement, the agreement that emerges from the all-party talks will have to be put in a referendum to the people of Northern Ireland for their consent. Given the nature of what is under discussion, that is proper. I reiterate that that consent, in that respect, remains at the heart of the Government's plans.
Lady Olga Maitland: May I welcome my right hon. Friend's courageous determination to keep up the momentum? Will he confirm that the international body has a clear remit to consider only illegally held weapons, and that there is no question that the legally held weapons of the security forces in Northern Ireland will be dragged into the process?
Mr. Major: Yes, I can confirm that for my hon. Friend. That point is explicitly made in the communiqué agreed between the Taoiseach and myself.
Mr. Ken Maginnis: May I begin by thanking the Prime Minister for clinging so tenaciously, if somewhat precariously, to his Washington third criterion, which requires that a full decommissioning process be agreed and the first phase be implemented before any paramilitary organisation can enter into substantive talks? May I caution him that the Irish are very good wordsmiths who are able to craft their language in a way which means all things to all people? Does he recall that Albert Reynolds, who with him signed the Downing street declaration, was unable to understand the meaning of "commitment to exclusively peaceful means" to include decommissioning of illegal weapons? Does he also recall that, in 1985, the Government's commitment to allowing the status of Northern Ireland to be decided by the people of Northern Ireland was overruled by the Irish Supreme Court, which said that status was not defined—carefully not defined? In the communiqué, could it be that the Irish believe that decommissioning is not defined—carefully not defined?
The Prime Minister: The hon. Gentleman began by saying that there was great skill in the use of language in Ireland, and I would suggest that that skill extends to all

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parts of the island of Ireland, both north and south. The hon. Gentleman has just illustrated that skill with great clarity, and I understand his point.
The hon. Gentleman was one of the early advocates of the possibility of an international body, and I congratulate him on his prescience in that respect. It is clearly a valid way forward, and we have decided to adopt it. We also were considering it at the time, and I am grateful for the hon. Gentleman's support. I believe that the hon. Gentleman is misjudging the communiqué in his use of language. The communiqué is not a fudge, and what is set out in it is very clear.
The only point of difference that exists between the British and Irish Governments has been set out clearly by both the Taoiseach and me last night and separately this morning. That point of difference has been acknowledged, but the substance of the communiqué is very clear and includes the remit of the international body and the nature of the arms to be considered by that body.

Social Security
4.15 pm
The Secretary of State for Social Security (Mr. Peter Lilley): With permission, Madam Speaker, I should like to make a statement on social security following my right hon. and learned Friend the Chancellor's Budget statement.
For half a century since the creation of the welfare state, expenditure on social security has, on average, grown 5 per cent. a year faster than inflation. As a result, it has taken an ever-growing share of national income and it has been an engine for rising taxes. Social security now costs the average working person £15 every working day.
That is why, when I became Secretary of State for Social Security, I launched my programme of step-by-step reforms. Those reforms are having an effect. During the next three years, spending should grow by little more than 1 per cent. per annum, well below the growth in the economy, so it will be a declining share of national income. It will leave scope for sustainable reductions in taxes. That in turn is the best of all ways to stimulate activity in the economy, to create jobs and to reduce benefit dependency.
Next year, planned spending on social security will be £90 billion. That is the figure I announced last year, and it is below the plans of two years ago. The figure includes nearly £3 billion to finance increased benefit rates. That is £600 million more than anticipated last year because it is based on the September inflation rate which jumped to 3.9 per cent., and has since fallen back to 3.2 per cent.
The measures that I am announcing today will save nearly £500 million in 1996–97 and more than £1 billion in 1998–99. Together, my reforms to date will save £3.5 billion next year. By the turn of the century, they will save £5 billion a year.
To be able to help those in need, we have to stop fraud. Despite tough control on overall running costs, I am channelling extra resources to the battle against fraud. Last year the Benefits Agency detected and stopped a record £700 million of fraud, and local authorities doubled their savings to £170 million, but prevention is better than detection and I am therefore pursuing an anti-fraud strategy based on prevention and deterrence.
In total my anti-fraud measures across all benefits will save £2.5 billion by 1998–99. The Benefits Agency has just started deploying one of the most powerful data matching systems in the world to identify suspicious claims. The agency will investigate claims and carry out more than 1 million home visits and other checks. It will tackle employers who collude with people who claim unemployment benefits while working. Next year, we will start computerising post offices and launch the benefit payment card.
Local authorities have responsibility for administering housing benefit. A recent study suggests that housing benefit fraud costs almost £1 billion a year, so I shall strengthen the financial incentives for local authorities to tackle fraud. I shall invite local authorities to compete for challenge funding for innovative anti-fraud measures. Next year, I shall introduce a national computer record of housing benefit claimants. That will stop people claiming from more than one local authority.

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From October 1996, further changes in housing benefit will reduce abuse and waste. Some tenants abscond without making initial payments to landlords, so I shall enable local authorities to make the first giro payable to the landlord.
Most other benefits are already paid in arrears. I shall align housing benefit with them. That will stop the wrongful payments that can arise when housing benefit is paid in advance.
In October, I announced proposals to limit asylum seekers' access to benefits. Seventy per cent. of people who claim asylum do not arrive as refugees, but make a claim some while after entering the United Kingdom illegally, or as tourists, students or visitors.
From next year, I intend to allow benefit only for people who claim asylum as they enter the UK. When a claimant is found not to be a refugee, benefit will cease. My proposals will save £160 million next year. My right hon. and learned Friend the Home Secretary is speeding up asylum decisions, which will further reduce the benefit cost. We will offer refugees a sanctuary, but we will not be a soft touch for social security.
During the past two decades, there has been a huge increase both in the number of lone parents and in their cost to the taxpayer, which is expected to reach £9.4 billion this year—equivalent to more than £1,500 a year extra tax on each working family with children of their own to support.
The right approach is neither to penalise nor to promote lone parenthood. The benefit system, however, gives special assistance to lone parents, which couples do not have. In particular, two components of benefit for lone parents have no equivalent for couples—one-parent benefit and lone-parent premium. They cost about £600 million a year.
To start bringing treatment of one-parent and two-parent families more into line, I propose no increase in either benefit next April. My intention over time is to continue to narrow the gap between the benefits that go to lone parents and those that go to couples. At the same time, I intend to build on our existing measures to help lone parents back to work.
Family credit has been of particular benefit to lone parents and I have greatly improved it. I extended family credit to people working part time, gave an extra £10 a week to people working full time and introduced a £40 a week allowance for the cost of child care. I now propose to increase that allowance to £60 a week. That will be of particular benefit to those who want to return to full-time work and those with more than one child. The provision of nursery vouchers will be an additional help to parents of pre-school children.
Maintenance is also an important stepping stone to work. Even absent parents on benefit should contribute to their child's support, so I propose to double the minimum payment of child maintenance to £4.80 a week from April next year. In addition, from April 1997, I shall pilot a major new scheme, which will provide individual help for up to 25,000 lone parents to find jobs or training opportunities.
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Finally, my right hon. Friend the Secretary of State for Education and Employment will extend the very successful scheme that has already created places to care for 50,000 children out of school hours, creating a further 18,000 places over the next three years.
As a result of the reforms already implemented, the proportion of lone parents in work has increased. The four measures that I have announced today will help more lone parents to become self-supporting.
Most young people starting out in work either stay with their parents, share a flat or find a bedsit, but those who are without a job can claim housing benefit and choose to occupy a better property than they could afford if in work, so for single people under 25 who are renting privately I propose to limit housing benefit to the average cost of shared accommodation in each locality. That will reduce disincentives to work, discourage young people from leaving home before they can afford to and reduce the attraction of moving to seaside resorts. The changes will apply from next October.
Couples, people with children and those exempted from the January housing benefit changes will not be affected. Local authorities will be given funds to prevent hardship in exceptional cases.
The new scheme should save more than £100 million over three years. Last year, I announced a scheme to continue maximum help with housing benefit during the first four weeks of work. I am now extending it to people who have been on a Government training course. In a separate measure, I intend to increase non-dependant deductions for housing costs.
The state system of social security provides decent help for those in need. However, the voluntary and charitable sectors provide extra help to cope with unusual circumstances. Voluntary bodies and charities can already pay £10 a week without the recipient losing benefit. I propose to double that limit to £20 a week. I believe that the change will be widely welcomed.
I propose some smaller measures to remove anomalies. I shall amend the industrial injuries benefit scheme so that those who receive reduced earnings allowance to compensate for loss of earnings should normally transfer to retirement allowance when they reach pension age. Separately, I shall align the mobility component of disability living allowance more closely with similar benefits that are withdrawn during hospital stays. I shall improve the information gathering used to make assessments for disability living allowance.
Britain already has one of the lowest non-wage labour costs in Europe. I intend to reduce it further. From April 1996, employers will qualify for one year's remission from their national insurance contributions for each person they take on who has been out of work for two years or more.
I am cutting the national insurance class 4 contributions for self-employed people by 1.3 per cent. from April 1996. This outweighs the loss of tax relief on these contributions announced by my right hon. and learned Friend the Chancellor. Finally, I intend to cut the main rate of employers' national insurance contributions by £500 million, some 0.2 per cent., from April 1997.
One of the main financial concerns facing elderly people is the prospect of needing long-term care. Providing for their needs in old age is, of course, one of

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the reasons why people save, but Age Concern and others have argued that the capital limits applying to people in residential and nursing care are tougher than the rules for people who stay in their own homes. They have urged us to raise the capital limits for residential and nursing care to those that apply to housing benefit.
We are going further than that. We are not just doubling the upper limit to £16,000 but more than tripling the lower limit. Under our proposals, people with up to £16,000 of assets will qualify for state help and people with capital of less than £10,000 will not be required to make any contribution from their capital towards the cost of basic residential care.
The new limits will apply from April 1996 at the latest to all people in long-term residential care or nursing homes. About 50,000 people should benefit in the first year. However, we also want to ensure that, in future, more people can afford care.
One of this country's major successes has been encouraging more private pension provision than any other European country. The challenge facing us now is to be equally successful in enabling people to make decent provision for long-term care. We are announcing three important proposals to stimulate the development of attractive savings and insurance schemes.
First, benefits from long-term care insurance will be tax free. Secondly, my right hon. and learned Friend the Chancellor is consulting on how occupational pension schemes can enable pensioners to defer some income early in retirement so that they have more income to help with the cost of long-term care. Thirdly, we will consult on partnership schemes that would enable people to retain even more of their assets in return for providing for a corresponding amount of their long-term care costs. That would encourage more people to make provision for themselves and it should help the insurance market to develop new products, as the risks would be limited.
Today's measures continue my step-by-step reforms of social security. I have protected the most vulnerable and I am creating a fairer and more modern benefit system, but our aim is to help more people off benefit altogether, and we are succeeding. We have fewer people out of work than any other major European country and more people in jobs.
My reforms will make a double contribution to that aim. They strengthen work incentives and encourage more people off welfare and into work. By controlling spending, they are easing the burden of taxes and helping to create a vibrant, free enterprise economy. That gives people the chance to find a job and provide for themselves, which is the best help that we can give them. It means that we can afford fair provision for those who are unable to work. My reforms give them a greater chance. I commend them to the House.
Mr. Chris Smith: I remind the Secretary of State at the outset of the background against which his statement is delivered. It is a background of rising inequality in society. Earlier this year, the Joseph Rowntree trust inquiry into income and wealth showed that inequality in income had risen rapidly between 1977 and 1990 to reach a higher level than has been recorded at any time since the second world war. In Britain, the poor are getting poorer and the rich are getting richer.
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The recent report of the Organisation for Economic Co-operation and Development shows that that growth is greater in the United Kingdom than in any other advanced industrial country. The number of people who are dependent on benefit has doubled since 1979, from one in 12 people to one in six. One in five non-pensioner households has no one in work. That is the background against which the statement comes; it is the background of a divided Britain. This statement and the Budget will make those divisions worse rather than better.
The proposal to pay housing benefit in arrears rather than in advance will not only harm landlords, but make it extremely difficult for people who need to claim housing benefit in order to move into new accommodation to do so. The present situation is bad enough—deposits are sought for which no funding is available—but this change will make it even worse.
The limitation of housing benefit amounts for young people under the age of 25 will have a series of malign consequences. It will force young people out of bedsits and one-bedroom flats into inadequate, unregulated and potentially dangerous multi-occupation dwellings. It will also be particularly damaging for young people coming out of care. They are often vulnerable and already face huge difficulties—we do not need to be reminded of recent tragedies to appreciate the dangers faced by lonely and vulnerable young people.
The proposal will also create a new unemployment trap. People on existing housing benefit who take up a job that might not last very long will be faced with a lower benefit and the potential loss of a home if they lose their job. The proposal will surely act as a disincentive to people in that position taking up work. Young people face a double whammy because, for the second year running, there is an increase in the non-dependant deduction on housing benefit that is well above the inflation rate. It will provide an incentive for families to remove adult children from the family home—and that is the proposal of a party that is supposed to favour keeping families together.
On the subject of families, perhaps I might discuss the measures for single parents. Is there not a fundamental fallacy at the heart of what the Government are doing? Are not they telling us that the costs of bringing up a child or children are exactly the same for a single-parent household as for a two-parent household? It is patently obvious that that is not the case in a host of different ways, especially because the costs of child care fall to be met by one income alone. One can never rely on the unpaid help of the other member of the household if one is a single parent.
The Conservative Government used to recognise that obvious truth. The 1985 Green Paper on the reform of social security argued that one-parent benefit should be continued
"as a contribution to the additional costs"—
additional costs—
"faced by lone parents in bringing up children alone".
It approved the introduction of a lone-parent premium in order to recognise
"the extra pressures faced by lone parents."
In 1985, the Government recognised that extra pressures and extra costs were faced by lone parents; now it would appear that they do not. What has changed in the meantime?

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In the White Paper that followed that Green Paper, the Government went even further. They emphasised that
"The principle of continued recognition of the need for specific further help for lone parents on top of that provided by the family premium has been welcomed."
It is that specific further help that they are now in the business of removing.
When will Conservative Members wake up to the fact that single parents are real people with real needs, and are not to be scapegoated at every turn?
Freezing lone-parent premium and one-parent benefit is bad enough. How will the phasing out happen? Will lone-parent premium be reduced year by year as family premium is uprated? Will single parents be confronted with a complete standstill in premium income as a result?
It is especially malign to attack one-parent benefit. It is an in-work benefit; it provides a through train from benefit into work. It is one of the few bits of the present welfare system that acts as a genuine bridge into work. We need to be removing disincentives that affect the move from benefit to work, not removing one of the precious few incentives that there are in the system.
I should like also to ask about the increase in minimum maintenance payments, from £2.35 to £4.80, under the Child Support Act 1991. Is not that a payment from absent parents that will frequently go straight into the pockets of the Treasury rather than the hands of the child or the caring parent? Will not many children experience no benefit from that change? Will it not also represent an effective reduction in income support for a single person, who will lose £2.45 under that measure but gain only £1.40 in the uprating? How can the Secretary of State justify his saying that a person in that position should live below what even the Government accept is the basic poverty line?
The increase in child care disregard on family credit—I must correct the Secretary of State, it is not an allowance, it is a disregard and there is an important distinction between the two—is welcome, but I note in passing that many people in real need already receiving maximum family credit will not be able to benefit from the increase in the disregard. I also note the failure to uprate any of the other disregards on housing benefit, family credit and income support.
Of course we welcome the raising of the long-term care thresholds, but is that not a very small step that leaves the great majority unassisted? The homes of many who live alone will be counted as assets, and a £16,000 threshold will surely go nowhere towards meeting their needs. Will not many thousands still live in fear of losing their homes? The Secretary of State has told us that 50,000 people will benefit from the change. Does that figure include those who may still be forced to sell their homes as a result of the current system? I must point out that the existing threshold has been frozen since 1988. Does the Secretary of State intend to uprate it regularly hereafter?
Does the introduction of a measure relating to industrial injuries in fact mean that those who have suffered an injury at work through no fault of their own will be forced out of reduced earnings allowance and lose three quarters of that benefit as a result? Will the Secretary of State also confirm that, of the cases that currently go to adjudication,
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only 3 per cent. have resulted in the refusal or reduction of disability living allowance? Given that small degree of error, will the right hon. Gentleman's information-gathering exercise—of which we have been given no details—be cost-effective in any way?
We consider the Secretary of State's proposals relating to asylum seekers to be inhumane and unjust. We do not believe that they will produce any real savings, especially in view of their impact on children and local authority care costs. We will oppose the proposals. We believe that the real way in which to tackle the problem is to speed up the assessment of applications. That is obviously not happening now, given that there is a backlog of 65,000—and it is growing.
I was pleased to note that the Government are to introduce tax exemption for compensation for mis-sold personal pensions for those who were wrongly advised to leave occupational pension schemes. That is a sensible measure: it represents the equivalent of a tax-free lump sum, and thus makes fiscal sense. What bearing has that proposal, however, on the position of those who may receive payments in respect of their having opted out of the state earnings-related pension scheme, rather than an occupational scheme, and what principles underlie the Secretary of State's approach in each case?
Today we have seen yet another relaunch of the fight against fraud. That fight is, of course, desperately important: every pound of which the system is defrauded is a pound less for someone in genuine need. Indeed, the Select Committee on Social Security recently told us that the figures were grossly underestimated, but why should we believe the targets that the Secretary of State has set today any more than the unachieved targets that he has announced in previous years? Last year, savings from the fight against fraud amounted to £717 million. The Red Book tells us that savings for 1998 will be £2.5 billion. Is the Red Book figure correct? How, precisely, will the Secretary of State achieve a 250 per cent. improvement in the tackling of fraud in the course of three years?
The Secretary of State has told us that there will be extra home visits each year. Even if the number reaches the 1 million home visits that the right hon. Gentleman anticipates, that figure will bring us barely above the 800,000 figure of 1989, and nowhere near the 6.6 million that took place in 1979. It is all very well to ring-fence special officers for fraud investigation, but should not every single member of DSS staff be part of the battle against fraud? If the administrative cost of the rest of the Secretary of State's Department is being squeezed, will that not damage the overall effort?
What about the level of errors? We know from the Comptroller and Auditor General's report that, in the last recorded year, £540 million was lost through departmental error in income support payments alone. Will not that be made worse, not better, by what is proposed in the statement? Will the Secretary of State now commit himself to implementing in full the Select Committee's recommendations on fraud?
Is not the statement just another example of the Government's approach to social security: not an overall coherent approach, just a piecemeal look, benefit by benefit, target group by target group—what can we take off mortgage payers or the unemployed one year and off young people and single parents the next? Surely the real way to set about reforming the welfare system and

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reducing the overall budget is not to harm the people concerned with benefit cut after benefit cut but to look at the system as a whole and put in place real measures to help them come off welfare and into work.
The statement showed precious little of the Chancellor's boasted social conscience. It has not protected the vulnerable. It does not come anywhere near a coherent benefit-to-work strategy. It deepens the divisions in a divided Britain. It is time for the Government who have created those divisions to go.
Mr. Lilley: How things have changed since the hon. Member for Glasgow, Garscadden (Mr. Dewar) was replaced by the hon. Member for Islington, South and Finsbury (Mr. Smith). The former was always careful to leave us entirely confused as to whether he was supporting or opposing what we had suggested. There is no doubt today that Labour has opposed every measure that we have introduced. The hon. Member for Islington, South and Finsbury has just chalked up a bill of £1 billion of savings forgone. How the Labour party can honour, "Vote in favour of our tax cuts" while opposing our savings remains to be seen. It is old Labour with a vengeance.
The hon. Gentleman began by referring to the Joseph Rowntree trust report. He clearly has not read the subsequent Institute for Fiscal Studies report which showed that, far from the poor getting poor and the rich getting richer, the poor have also got richer in the sense that the bottom 10 per cent. spend substantially more now than they did in 1979, and a high proportion of them move each year to higher deciles in income distribution.
The hon. Gentleman criticised our measures to restrict housing benefit for the under-25s to the sort of accommodation that most people who are paying for their housing when in work choose to occupy. I cannot see the logic of his position there.
The hon. Gentleman was worried about the danger of properties in multiple occupation. The answer to that is proper regulation and enforcement, not to try to manipulate the benefit system, which already leaves many people in such properties.
The hon. Gentleman referred to the difficulties that young people might have getting back to work. He clearly does not understand the run-on scheme, which I announced last year and which is being introduced from April. It will allow people to keep, for four weeks after returning to work, the maximum housing benefit even though they are in work and may no longer be entitled to it. That will be a major help for young people and others returning to work. There will, of course, be special provision for the more vulnerable groups, as there is in the changes that begin in January.
The hon. Gentleman does not seem to recognise that
"For decades politicians would not talk about the issue. Tax and benefit policy was squeezed to help single parents and childless couples. Single parents gained more help than did two parents. That policy has got to be reversed."
Those are the words of the Chairman of the Social Security Select Committee in September this year, and I agree with him.
The hon. Gentleman does not seem to realise that one-parent benefit, when it was originally introduced by Barbara Castle—as both the Chairman of the Select Committee and Barbara Castle herself made clear—was
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never part of any strategy. It was merely an attempt at a quick fix. Barbara Castle said that it was an interim benefit for the one-parent family "for a year" and that it would cease when the child benefit scheme came into effect.
The hon. Gentleman argued that one-parent benefit is necessary as a work incentive. Since we are treating lone-parent premium—which is the counterpart to the out-of-work benefits—in parallel with one-parent benefit, there is no problem with any change in work incentives. We believe that the right approach is to encourage people back into work. We are doing that by increasing the child care disregard and by the range of other measures that I have announced today. Indeed, I calculate that the expansion of nursery care vouchers will almost cost more than the savings that we are achieving initially from our lone-parent measures. Once again, the Opposition would not be able to finance desirable schemes because they refuse to make the savings necessary for them.
The hon. Gentleman was completely silent on what Labour proposes to do about long-term care. He hinted that the Labour party was proposing to spend billions of pounds more of public subsidy. We believe that it is right to try to achieve as much success in enabling people to finance long-term care as we have had enabling them to finance decent pension provision. That is the burden of the various measures that the Chancellor and I are introducing.
The reduced earnings allowance, as its name suggests, is a compensation for people who have suffered injuries that have reduced their earning capacity. The allowance is intended to apply to people during their working lives. Because of some anomalies, it does not stop for all people when they reach retirement age. We are trying to ensure that, in the majority of cases, the allowance will stop and be replaced by the retirement allowance, which is appropriate in retirement.
Mr. Smith: When they have less income.
Mr. Lilley: Of course most people have less income when they retire than when they are at work, but they none the less get some compensation through the retirement allowance to acknowledge the fact that they have been able to make less provision during their working life because of the industrial injury.
A fair structure of benefits has been agreed by Parliament and we are now trying to implement that properly through regulations.
The hon. Gentleman says that all we should do for asylum seekers is to speed up the process. The Home Secretary is doing a great deal to that end. I understand that the Opposition are opposing the measures that would enable my right hon. and learned Friend to speed up the process. As long as we are a honeypot attracting people for benefit reasons, we will find it impossible to give proper consideration to the genuine refugees who reach our shores—whom we all want to help.
I am not surprised that the hon. Gentleman chooses to try to ridicule the changes that have been made to assist detection of fraud. He said that our previous targets have not been achieved. He is wrong. Our target for the current year was about £648 million of fraud detected and stopped by the Benefits Agency. The actual figure was £717 million, just by the Benefits Agency. Fraud savings have also been made by local authorities and by the

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Employment Service's fraud department, which has now merged with my Department. That is why there is an apparent disparity in the figures that the hon. Gentleman quoted.
There will be a substantial increase in the fraud savings because of the extra resources that I have devoted to it and the strategy that I am pursuing, which the Labour party appears to oppose. I remind the hon. Gentleman that the hon. Member for Sheffield, Brightside (Mr. Blunkett) has said that Labour has too long been associated with the freeloaders.
Several hon. Members rose—
Madam Speaker: Order. That initial exchange has taken 37 minutes. I must now insist that hon. Members put brisk questions. I equally insist on brisk answers because we have other business to conduct in the House today.
Sir Andrew Bowden: I welcome the announcement on long-term care. Will my right hon. Friend enlarge a little on partnership schemes? Does he foresee those schemes including the ability to purchase a room in a residential home or some sort of equity in a residential home so that a person who moves into a home can retain some capital for his or her family in the future?
Mr. Lilley: My right hon. Friends and I will issue a paper to consult on the possibility of proceeding with partnership schemes. It would be wrong to speculate now on the full extent of them, but I note the point that my hon. Friend has made. I know of his great interest in this matter and I am sure that we shall receive helpful and extremely well-informed contributions from him once the proposal is in the public domain.
Mr. Simon Hughes: My question, too, is about how the Secretary of State's announcement affects older people. Why has not he altered the insulting additional 25p payment for over-80 pensioners, which has remained in place for so long? Why, after 23 years, has he still not adjusted the Christmas bonus, which remains at £10? Was not the Chancellor's residential care announcement yesterday a giveaway, as it increased capital allowances? Will not we have a takeaway from the Secretary of State for the Environment tomorrow when he announces that local authority funds will be cut? Is not this an attempt at a getaway by the Secretary of State for Social Security because he is not increasing the special transitional grant for community care?
Mr. Lilley: I can answer that question briskly. Unlike the Opposition, we are in serious government and cannot afford to hand out money like confetti.
Mr. Tim Smith: May I congratulate my right hon. Friend on the meticulous and patient way in which he has carried out his comprehensive review of social security spending since 1992? What would total spending have been if none of the changes had been made, and what would have been the cost to the taxpayer?
Mr. Lilley: I am grateful to my hon. Friend. If none of the changes had been made, expenditure next year would have been about £3.5 billion higher than it will be; by the
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end of the century it would have been £5 billion higher; and in the next century it would have been three times that figure—nearer £15 billion higher.
Mr. Frank Field: As every statement by the Secretary of State is incomplete until he has announced new anti-fraud measures, when does he expect to have an adequate anti-fraud programme in place? When will it be safe for taxpayers to trust him with their £90 billion contribution?
Mr. Lilley: We can make greater progress than any previous Government because of our benefit reviews, which enable us to identify, measure and investigate the different kinds of fraud. Those reviews are taking place benefit by benefit. Provisional results from the review of housing benefit show a substantial amount of fraud there. That information enables us to carry forward anti-fraud measures against housing benefit with local authorities. I imagine that the other benefits are likely to show a lower level of fraud. The answer to the hon. Gentleman's final question is that there is greater security with this Government, and me in charge of the anti-fraud campaign, than there would be with anyone else, with the possible exception of the hon. Gentleman.
Mr. John Townend: Will my right hon. Friend accept my congratulations on all the savings that he has made? I am slightly mystified, however, in view of the great number of savings that he has outlined to the House, that page 126 of the Red Book shows that social security spending has gone up, compared with plans for 1996–97, by £1,040 million and that, for 1997–98, it is proposed that the increase from previous plans be a further £550 million.
Mr. Lilley: I am grateful to my hon. Friend. I think that I can help him with the figures. They refer to the control total, which forms only part of the actual total and excludes all cyclical benefits in my Department. Offsetting savings have been made in some areas of cyclical benefits, which are not included in the control total. We excluded cyclical benefits because we thought that it was right to let the cyclical effect of increased spending occur during the recession and be fully financed by extra taxation. As I said this morning, only two things drive up taxes—recession and a Labour Government. We are coming out of recession; let us ensure that we do not have a Labour Government. We can then be certain of sustained lower taxes.
Mr. Terry Rooney: The Secretary of State will be aware that one of the greatest areas of fraud is among corrupt employers who work in the black economy. Why has he cut Contributions Agency field inspectors by 60 per cent.?
Mr. Lilley: I said in my statement, quite contrary to what the hon. Gentleman says, that with the integration of the Employment Service fraud officers and my Benefits Agency staff, there will be a special effort to crack down on collusion between employers and employees. I am glad to have the hon. Gentleman's support for that.
Mr. Peter Luff: In my constituency and around the country the elderly and those approaching retirement will welcome the measures that my right hon. Friend has announced for long-term care and those that my right hon. and learned Friend the Chancellor

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announced yesterday about tax on savings. Will my right hon. Friend continue with research to find ways to reward rather than penalise those who have been prudent enough to prepare for their old age?
Mr. Lilley: I am grateful to my hon. Friend for his welcome. He is right to say that, going beyond the measures that I have announced and including those announced by my right hon. and learned Friend the Chancellor, this is a Budget for everybody but specifically for the prudent and the elderly. We think that those who are prudent enough to save for retirement should be encouraged to do that, hence the lower tax on savings, measures to promote investment for long-term care and the recognition of the comparative harshness of the previous capital rules.
Mr. Dennis Skinner: Does the Secretary of State recall that in the past few weeks, the nation has been aghast at the stories, emanating from around Gloucester and elsewhere, of young women in particular roaming the streets and being picked up by Rose and Fred West? By proposing to take away some of the housing benefit from under-25s, he will create a situation in which thousands of young people will be roaming the streets. Any decent Government would withdraw that proposal. If he wants to do something about high rents, he should tackle the landlords—his friends.
Mr. Lilley: Even by the hon. Member's standards, that is a distasteful attempt to exploit a ghastly tragedy for party political ends. We propose to continue housing benefit for the under-25s but to restrict it to the level that is payable for shared accommodation. That is only right and proper. A number of the measures that we have announced will prevent abuse by both landlords and tenants.
Mr. Bernard Jenkin: Is it not disturbing that total spending on social security is still rising despite all my right hon. Friend's efforts to curb it? Does not that demonstrate that, unless we continue to reform social security and tackle fraud, the burden will continue to rise and threaten the country's prosperity?
Mr. Lilley: I agree that further work needs to be done. I spelt out that there would be a step-by-step, sector-by-sector review of social security. That is the way in which we have approached it. None the less, it is worth noting that the average growth- in real terms of social security spending over its first 50 years was 5 per cent. a year, while over the next three years it is expected to be a little over 1 per cent. That is a major change, and this must be one of the very few countries in the developed world that can expect social security to take a declining proportion of national income in the years to come, thereby reducing taxes and the burdens on creating jobs.
Ms Angela Eagle: Given that the Government have admitted that lone parents face extra costs, can the Secretary of State explain why the children of lone parents should be made to suffer because of the marital status of their parents, which after all is not their fault?
Mr. Lilley: Lone parents receive extra money relative to couples in a number of ways and not just through lone-parent premium and lone-parent benefit. The lone parent receives £10 a week more in her or his personal
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allowance than when she or he was part of a couple. That reflects the greater cost of living alone. There are a number of other changes, the most important of which is the introduction of family credit. It is heavily weighted to the benefit of lone parents and has significantly increased the chances of lone parents returning to work. We must build on that.
Mr. Nick Hawkins: The measures announced by my right hon. Friend will certainly be welcome in many seaside resort constituencies, not least because of the help that he has announced for those who are in long-term care, his raising of capital limits and his continuing support for the most vulnerable pensioners. Is he surprised to know that, contrary to what the hon. Member for Bolsover (Mr. Skinner) said, Labour councillors in many seaside resorts own and run houses in multiple occupation and benefit as unscrupulous landlords? That is the record of Labour in power.
Mr. Lilley: My hon. Friend speaks with great knowledge of this matter and I am sure that his remarks will bite home among Opposition Members. I am grateful to him for his welcome, and I know that the measures that I have announced will be well received not just in Blackpool but in many other seaside and inland resorts.
Mr. Alan Howarth: What assessment has the Secretary of State made of the cost to public expenditure of his decision to cut the value of lone-parent benefit, thus making it harder for lone parents to be in work? What assessment has he made of the effect of reducing the lone-parent premium which, through impoverishing households, means that more children are likely to be taken into care? On what evidence does he justify his decision to erode lone-parent premium which was introduced by his predecessor in 1988 in recognition of the additional costs and pressures faced by lone parents? Why does the Conservative party insist on stigmatising lone parents?
Mr. Lilley: That is nonsense, as my hon. Friend—well, he is a friend, though not in the technical sense that he was before—used to know. The hon. Gentleman is talking absolute nonsense. We are moving lone-parent premium and one-parent benefit in parallel and there is thus no change in work incentives. We are simultaneously improving rewards for work through changes to family credit, making it available to part-time workers, increasing its value for full-time workers and covering more generously the cost of child care. He should recognise and welcome those changes. When he has considered them, perhaps he will review which side of the House he should sit on.
Dr. Robert Spink: In welcoming my right hon. Friend's reduction, albeit marginal, in non-wage labour costs, may I ask him to resist Opposition policies that would increase not just non-wage labour costs through the adoption of the social chapter but direct labour costs because of the minimum wage? That would happen at all salary levels because the policies advocated by those on the Opposition Benches would put people out of work.
Mr. Lilley: Far more important than anything that we can do directly to improve the benefits system are measures that increase the number and availability of jobs for those who would otherwise depend on the benefits

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system. We have been more successful than our counterparts in Europe in getting unemployment down and getting people into work. We have about 68 per cent. of people of working age in work. On the continent the average is 60 per cent. If we had the same average as that on the continent, which the policies of the Opposition might well achieve, there would be 3 million fewer people in work in this country. That is a measure of how important it is to stay out of the social chapter and continue to reduce taxes and the costs of creating jobs.
Ms Roseanna Cunningham: Does the Minister recall the warnings prior to the removal of benefit for 16 and 17-year-olds that its abolition would simply result in an increase in homelessness? Does he not understand that because of that there is widespread support for the restoration of that benefit, particularly in Scotland? I am happy to say that my party is in favour of that. Does he not understand that there will be further widespread revulsion at the cuts in housing benefit because they are likely to lead to yet another increase in homelessness? People will be afraid that instead of seeing a "Big Issue" vendor on every street corner they will see one in every doorway as a direct result of the Government's policy.
Mr. Lilley: I understand that the Opposition think that the working of the rules that we introduced to remove automatic entitlement to benefit from 16 and 17-year-olds and instead give guaranteed training places should be extended to everybody under the age of 25. Therefore they have found evidence opposite to that of the hon. Lady, or at least the hon. Member for Dunfermline, East (Mr. Brown) finds the opposite sort of evidence because he thinks that young people under 25 should have benefit removed if they do not fulfil his edicts. However, I gather that that view is not universally shared by his Front-Bench colleagues.
Mr. Anthony Coombs: Does my right hon. Friend agree that, in my constituency, few things annoy thrifty pensioners more than seeing young people touring the country on virtually unlimited housing benefit? Does he therefore agree that those pensioners will welcome the idea that there should be a limit to the costs of housing benefit on the basis of locally shared accommodation for under-25s? How will that be calculated?
Mr. Lilley: I am grateful to my hon. Friend for his welcome. The proposal is that the structure set in place by the January changes, under which rent officers will assess the average reference rent for each type of property in each region, will apply to shared accommodation. Rent officers will set a reference—effectively, the average level of such properties in each locality. That will be the maximum to which people under 25 will be entitled to claim housing benefit.
Mr. Jeff Rooker: Why is it possible, even after this statement, for a landlord owning and renting property and receiving an income to receive housing benefit personally? Why do not the same capital disregard rules apply to that landlord as apply to elderly people who may, even after the statement, have to dispose of their property to go into care? Why do we featherbed
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landlords so that they may obtain housing benefit? The Secretary of State looks so surprised: he does not even know about it.
Mr. Lilley: The hon. Gentleman might be right. He might have found something that I did not know about, in which case I shall be only too happy learn, but I am not sure that there is any such rule as he suggests, unless he is merely saying that landlords receive rent paid from housing benefit, which of course they do. If they did not, they would not rent out their properties to people on housing benefit. We could discuss that matter afterwards. I would be only too happy to become better informed on that matter.
Mr. Tam Dalyell: What is the estimated cost to the Treasury, to the nearest £5 million please, of making benefits from long-term care insurance tax free'? There must be a notional sum in the brief somewhere.
Mr. Lilley: There must be but, that being a tax matter, it is not a figure that I carry in my head and no Treasury Minister is within earshot, so I shall have to write to tell the hon. Gentleman what the number is. [HON. MEMBERS: "It is in the Red Book."] It may well be in the Red Book, but I am sorry—I cannot give the figure to the hon. Gentleman off the cuff.
Mr. Harry Barnes: One of the Government's objectives is to get rid of inheritance tax. One of the few elements that many pensioners hold that could be an inheritance in future is their homes, which they are proud of, but which are small and would not bring much on the market. They could bring more, however, than the £16,000 that the Minister has mentioned within the changes, if they take place. Will he not consider protecting the inheritance that elderly people have, so that it is not ripped off by people in private nursing homes?
Mr. Lilley: As I mentioned, and as the Chancellor mentioned yesterday, we are considering schemes whereby people would be able to protect an additional element of their capital by making prior provision for a certain amount of long-term care costs. If they have to activate that and spend that money, or the insurance company on their behalf has to spend that money, there will be a corresponding increase in the capital limit applying to them—that is the rough structure of the proposal. We are open to discussion about how it should work in detail, but it is precisely the sort of thing that the hon. Gentleman suggests his constituents would like, and I am sure that, as a result, they will be voting Tory.
Mr. Paul Flynn: Will the Secretary of State instruct his anti-fraud staff to read his statement today to discover whether it is fraudulent to deny any increases on 30 benefits, including the widow's payment, which is £1,000, but would be £1,881 if it had been increased along with earnings'? Will he include in the Official Report a full statement on all benefits that have not been increased today? Some of them have never been increased. They replace benefits that were increased by inflation. Will he explain his reasons for freezing them?
Mr. Lilley: If all benefits had been uprated in the way in which the hon. Gentleman suggests, the cost would run into billions. Like the hon. Member for Southwark and Bermondsey (Mr. Hughes), he belongs to the confetti

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tendency of public expenditure. Any responsible party or Government simply cannot do all the things that he would like to do.
Mr. Jeremy Corbyn: Will the Secretary of State consider that his naked appeal to the xenophobia of the Tory party has brought us the habitual residence test and all the misery that goes with it? He now proposes to take benefits away from asylum seekers from next year. Bearing it in mind that Britain has fewer asylum seekers than any other European country and the lowest number of acceptances, he is appealing to the racism of his party. His proposals will lead to destitution among people who are fleeing oppression.
Mr. Lilley: With respect, this is not a racial issue, but a benefits issue. The people who play the racial card are those who want to divide for their own reasons. That is monstrous and irresponsible. We believe that it is not right that people who enter the country as tourists, business men or other types of visitor on the understanding that they will not be a burden on public funds, who have been here for some while and who decide, typically when their visa runs out, to lodge a claim for asylum, should become entitled to benefits. As for the treatment of asylum seekers who have had their claim rejected by the Home Office, we treat their right to benefits during the period of appeal on the same basis as we treat the right of British citizens who appeal against refusal of benefit. Far from being racist, therefore, we are putting people on an equal footing.
Madam Speaker: We now come to the statement by the Secretary of State for Scotland.
Mr. Dalyell: On a point of order on this statement, Madam Speaker.
Madam Speaker: I cannot take a point of order at this stage. Other hon. Members are waiting to hear the statement and it is usual for points of order to be taken at the end of statements.

Scotland (Government)
5.15 pm
The Secretary of State for Scotland (Mr. Michael Forsyth): With permission, Madam Speaker, I should like to make a statement about the government of Scotland.
Scotland has prospered under this Conservative Government. The economy has been transformed, unemployment is at its lowest for 15 years, and inward investment is booming.
The foundation of Scotland's economic success is the constitutional stability guaranteed by the Union—Opposition Members are meant to cheer at that point. The Union is not a dry legality; it is much greater than the sum of its parts. It is a constantly growing and living relationship, in which we must all continue to invest. It is strengthened by devolution for people, not for politicians. That means devolving power downwards from central Government, through local authorities, to community councils, school boards, housing associations and all other representative local groups, and ultimately to families and individuals.
The Government utterly reject a tax-raising Parliament that would damage Scotland's jobs and prosperity. We have long recognised that Westminster and Whitehall can seem remote from the people of Scotland. After all, it was a Conservative Government which established the office of Secretary for Scotland and the modern Scottish Office. As we made clear in the White Paper "Scotland in the Union", we believe that the correct approach is to work within the existing, successful framework of the Union to make Government and Parliament at all levels more visible and relevant to the people.
The expanded role recently created for the Scottish Grand Committee has been helpful both to Scottish Ministers and hon. Members, and to the business of the House in general. It has been extremely well received in Scotland, where the Committee's sittings north of the border, most recently in Aberdeen, brought Parliament to the people, making for better government.
My right hon. Friend the Prime Minister said in 1993 in his foreword to "Scotland in the Union" that the White Paper was not the end of the story, but part of an on-going process. He said:
"Our search for new ways to strengthen the Union will go on. We stand ready to take account of changing circumstances. And our drive to strengthen Scotland's place in the Union—and thus the United Kingdom itself—will continue."
It is in accordance with that commitment that I have been working with my right hon. Friend the Prime Minister and my other right hon. Friends. I want to tell the House today of important changes that we propose to the way in which legislation is handled and Ministers called to account.
We believe that it is right to debate the Second Reading of Scottish Bills in a Scottish forum, and so to increase the involvement of the Scottish people in the process. We intend that, from now on, Scottish Bills coming to the House should have their Second Reading in the Scottish Grand Committee sitting in Scotland, whenever it makes sense that that should happen.
The other key stage of consideration of principle is the Third Reading. We believe, in such cases, that that too should be debated in the Scottish Grand Committee, so that people can see what is being done at the stage of

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commitment to the approval of the Bill after the processes of detailed consideration and amendment. The technical processes will be essentially similar to those already in place for Second Reading.
Making greater use of the Scottish Grand Committee in that way will mean that we can expand the Scottish legislative programme. As an example of the potential that that provides. it has been possible this year to add the Licensing (Amendment) (Scotland) Bill—[Laughter.] I am glad that hon. Members find a Bill to tackle the problem of drug misuse at raves amusing; I happen to think that it is central to our legislative programme.
Secondly, we want to use to the full the procedure under which, before Scottish Bills embark on their Committee stage, evidence can be taken by a Special Standing Committee meeting in Scotland. That was done with the Children (Scotland) Bill last Session, and was very successful. It is suited to uncontroversial Bills, and is especially relevant to Scottish circumstances.
There is in Scotland a range of professional bodies and other well-informed interest groups that have less access to the Westminster process than do their counterparts in England. The use of a Special Standing Committee gives such people an opportunity to make a key impact at a formative stage of the process.
I am pleased to be able to say in addition that my right hon. and noble Friend the Lord Privy Seal is actively pursuing the possibility of establishing a new procedure in another place, to allow evidence to be taken in Scotland for Scottish Bills that are introduced in the House of Lords. It is our hope that that approach may be followed in the first instance for the Deer (Amendment) (Scotland) Bill, which was published last week.
I turn now to the way in which Ministers are called to account. [Laughter.] Another advantage in the new procedure will be the fact that people in Scotland will be able to see how the Opposition behave. The Scottish Grand Committee already has the opportunity to call to account the Secretary of State for Scotland and other Ministers at the Scottish Office. But the business of government in Scotland is not the responsibility of the Secretary of State alone.
Many of my right hon. Friends have responsibilities and take decisions on a daily basis that impact directly on the people of Scotland; so it is only right that they too should have to explain to the Scottish Grand Committee in Scotland why particular policies are being followed, and the benefits that they will bring. I therefore recommend to the House that we should change Standing Orders to achieve that.
The importance of the innovation should not be underestimated. It offers the opportunity of adding a completely new dimension of accountability for Government business in Scotland, with the Prime Minister, the Deputy Prime Minister, the Chancellor of the Exchequer, the Secretary of State for Social Security or the Secretary of State for Defence, for example, taking part in debates in Scotland and being able to present policies and react to criticisms of them; and it will all be done in a forum accessible to the people of Scotland.
Additionally, the provisions that already allow Scottish Office Ministers in another place to make statements to the Scottish Grand Committee will be extended to include all Ministers in another place.
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We shall bring the new Standing Orders forward for approval shortly. To ensure that the process can be planned properly, we shall need a timetable for sittings throughout the year. I am today tabling motions for eight meetings of the Scottish Grand Committee to consider Government business, and two meetings to consider Liberal Democrat party and Scottish National party business, all of which will be held in Scotland.
As soon as the Labour party has made up its mind where it wishes the meetings to consider its business to be held, and on what dates, we shall agree through the usual channels the full programme for the Committee, and a motion will be put before the House for approval. It will provide for the Scottish Grand Committee to meet much more frequently in Scotland, and I intend that that should involve more places in Scotland. I am delighted to tell the House that, provided that the relevant changes to Standing Orders are approved, the Prime Minister and the Chancellor will take part in the Grand Committee debates in Scotland in the new year.
To sum up—[Laughter.] To sum up—
Mr. George Robertson: Is that it?
Madam Speaker: Order. The House must come to order. [Interruption.] If hon. Members seek to ask questions later, they had better come to order now.
Mr. Forsyth: The hon. Member for Hamilton (Mr. Robertson) knew precisely what I intended to say, because I gave him a copy of my statement in advance. He knew exactly what was being proposed, which is why his laughter was not quite co-ordinated with the statement.
To sum up, the changes that I propose will greatly strengthen the role of the Scottish Grand Committee in considering legislation affecting Scotland, and will provide for an expanded Scottish legislative programme that will be examined in Scotland in ways that should produce better legislation, and involve the people of Scotland.
The proposals will provide a new focus for the role of the Scottish Grand Committee in scrutinising and calling to account not just Scottish Office Ministers but every Minister. The Scottish Grand Committee will thus assume an increasingly pivotal role in the parliamentary government of Scotland, in bringing Government closer to the people, and in underpinning the Union.
What the people of Scotland want is Government close to them, Government listening to them, and above all, Government accountable to them. This historic Parliament embodies our great Union. It is the only Parliament that can effectively and powerfully secure Scotland's interests and future.
The changes represent a significant step forward. They must be seen in the context of our plans to devolve power to local government, to create a new forum based on the Scottish Economic Council, and to give the people of Scotland more control over their own lives. The Government stand four-square behind the Union, and thereby behind Scotland and her people. I commend the proposals to the House.
Mr. George Robertson: The statement was a stark admission that the Government's policies towards Scotland have utterly failed. The whole speech was a confession that, for the past 16 years, the Conservative

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party has got the government of Scotland wrong. The "do nothing" policy of the Government has now been replaced by the "do as little as possible" policy. First we had "Taking Stock"; now we have taking the michael.
Did that statement really represent the full breadth of the Secretary of State's vision for his country? New Forsyth, new status quo? Is that the Secretary of State's really big idea—weekend breaks and awayday trips for the Cabinet, from the grouse moor to the Grand Committee? Will the Secretary of State confirm that that was really his best shot, and that after all the hype, the build-up and the publicity, it is the best that he could come up with?
The Secretary of State told the press the other day that, when he drew up the changes, he had started with a blank sheet of paper. Obviously he did not get much further than that, because today's long-awaited package is even more of a let-down than the new Beatles single.
Will the right hon. Gentleman admit that his revamped Scottish Grand Committee will be little more than a rubber stamp for non-controversial legislation? In that case, what has really changed? The Scottish Grand Committee can already deal with non-controversial legislation, as it did last Session with the Children (Scotland) Act 1995. We facilitated that Act's passage on to the statute book. Indeed, the Secretary of State can always expect co-operation from Opposition Members where consensus exists.
I ask the right hon. Gentleman again: what has really changed, other than the fact that there will be an extra stage for Scottish Bills and a few more meetings, debates and opportunities to hear Ministers and their reinforcements desperately recruited from the Cabinet dodge even more difficult questions?
My hon. Friends and I welcome the opportunity of more debates with the Secretary of State and his colleagues. I look forward to exposing the Government's betrayal of Scotland, wherever the debates take place. Does the Secretary of State not realise that this travelling circus is no substitute at all for a Scottish Parliament, elected by, and responsible to, the Scottish people?
Is it not true that the proposals will mean that not a single extra decision will be taken by Scotland's Members of Parliament, and that the so-called new Scottish Grand Committee will continue to be no more than a toothless talking shop, with no real powers to change Scotland for the better?
To get down to the specifics of the statement, what about the Third Readings in the Scottish Grand Committee? Will the Secretary of State confirm that decisions on Second and Third Readings taken in the Grand Committee will not stand, but that they will simply be on procedural motions that can be overturned by a Tory majority on the Floor of the House?
Since that is the case, will that not be yet another worthless trick, offering nothing beyond the present position, in which no real decisions can be taken in this tarted-up Scottish Grand Committee?
I should like to put the real acid test to the Secretary of State. Will the Scottish Grand Committee decide on the issue of nursery vouchers for Scotland, as was promised in the Scottish Office press notice which described his education Bill in the Queen's Speech? Or is he simply
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going to sneak through this unpopular, unwanted intrusion into Scotland's education system by some statutory instrument or by adding it to the English Bill?
I tell the Secretary of State this: if Scotland's representatives will not be able to make decisions on such legislation, his reforms will be simply worthless. The people of Scotland are not going to be bought off with a few more powers for local government, a few more debates in the Grand Committee, or some beefed-up old quango. That is not real devolution: it is simply a con trick—nothing more and nothing less.
The unity of this country, which we value as much as any Conservative, will never be guaranteed by cosmetic, panic-driven gimmicks that arrogantly insult the intelligence of the Scottish people. The people of Scotland want a Scottish Parliament, and nothing less will do. Only a Labour Government will deliver that to them.
Mr. Forsyth: I do not know whether the hon. Gentleman cleared his lines with the right hon. Member for Sedgefield (Mr. Blair). Is he advancing a proposition that a Scottish Grand Committee should be able to pass legislation without the approval of this House, which is what it sounded like he was saying? Is that his position? The hon. Gentleman was implying that that was his position.
Can we take it, then, that it is the Labour party's position that, under a Labour Government, an English Grand Committee, for which there are provisions in our Standing Orders, would be able to pass legislation without the consent of this House? The hon. Member for Hamilton is nodding his head in agreement. I had no idea that he had jumped so far into the nationalist camp. He is supposed to be a Unionist politician. He speaks the language and the policies of nationalists.
We Unionists believe in the sovereignty of this House. The proposals that we have put forward are to strengthen the Union, to hold Ministers who are accountable to the House accountable within Scotland.
The hon. Member for Hamilton asked how accountability will be strengthened. If he thinks that senior Ministers having to go to Scotland to debate issues will not result in their Departments having to wake up rather more to the Scottish dimension, he has even less experience and understanding of government than I imagined.
I ask the hon. Member for Hamilton to solve this puzzle: why is he so opposed to the proposals? Imagine for a moment—it is a big thought; an impossible thought—a Labour Government and their having a majority in the Grand Committee with its proposed powers. They could take legislation through the Grand Committee, through all its stages. They could win votes, because they would have a majority. Indeed, they could do everything in the Grand Committee that they could in a Scottish Parliament, and more. The only thing that they would not be able to do is raise taxes in Scotland, and make the Scots pay a tartan tax. In addition, they could hold the Prime Minister to account.
Writing in the Evening Times, the Leader of the Opposition was quoted as saying:
"I look forward to the day when, as Prime Minister of the United Kingdom, I will be able to visit a Scottish Parliament working to improve life for the people of Scotland".

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Our proposals mean that the Prime Minister will not visit a Scottish Parliament—he will go to Parliament in Scotland and will be held to account by this House.
Mr. Allan Stewart: May I congratulate my right hon. Friend first on his practical and innovative Unionist package, and secondly on smoking out the hon. Member for Hamilton (Mr. Robertson) as the crypto-nationalist we always thought he was?
Will my right hon. Friend develop the point that he has just made? What on earth could a Labour Scottish Parliament actually do which, under his proposals, a Labour Government, sitting here, could not in any event do, except impose additional taxes on the people of Scotland over and above the taxes imposed on the people of the United Kingdom? Surely the hon. Gentleman has failed to answer that question.
Could we have the first meeting with the Prime Minister in that well-known Unionist citadel of Eastwood?
Mr. Forsyth: I shall bear in mind my hon. Friend's bid. I hope that towns and cities with suitable premises with which the House authorities are satisfied will bid for the Grand Committee to come into their communities. I am sure that that would be a desirable step forward. My hon. Friend is absolutely right. All that the Scottish Parliament will be able to do is raise income tax by 3p in the pound and make the people of Scotland pay more tax than that paid in England—and in Wales, because Labour's proposals for a Welsh Assembly do not include tax-raising powers. We have to have a tartan tax, but no Taffy tax, which seems to be deeply unjust.
Of course a Scottish Parliament will not be able to decide the level of the Scottish Office budget. That will be decided here in Westminster. Indeed, hon. Members on the Liberal Bench have already conceded that we would have fewer Scottish Members of Parliament and no Secretary of State. So who will speak for Scotland when the money is decided?
Mr. James Wallace: People in Scotland, and, indeed, the Secretary of State's fellow Cabinet members, will notice that, a few moments ago, the right hon. Gentleman conceded that many UK Departments were not fully awake to the needs of Scotland when dealing with legislation.
Will the Secretary of State confirm that, when the Prime Minister was on his soapbox before the election defending the Union, he had in mind that to do so would require an awayday ticket to attend meetings of the Scottish Grand Committee in Scotland? Will he answer the question that he has already been asked: whether education vouchers policy will be subject not only to the Scottish Grand Committee's deliberations but to a vote?
The Secretary of State has said that Ministers will be able to go to Scotland to present policies and react to criticisms of them. Will he confirm that there is nothing in his proposals that says that Ministers will change those policies in the light of Scottish opinion?
Mr. Forsyth: Of course we will take account of Scottish opinion. I am quite prepared to discuss through the usual channels which Bills have their Second Reading
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in the Scottish Grand Committee. In fact, the provisions which require legislation concerning nursery vouchers are, for example, to secure inspection, which the hon. Member for Monklands, East (Mrs. Liddell) has been going around Scotland saying is essential for nursery vouchers. So I am surprised that hon. Members are contemplating the prospect of voting such things down.
Mrs. Helen Liddell: Is it to be a statutory instrument?
Mr. Forsyth: The hon. Lady asks from a sedentary position whether it is a statutory instrument. The answer is no. In fact, we do not require legislative powers at the present time in order to pay grants directly to parents. But we will make provision in the legislation, and when it is published, Members will be able to discuss it. We can discuss whether that can be dealt with through the Scottish Grand Committee.
I would certainly welcome the opportunity of scrutiny in Scotland, so that every parent with pre-school children would know that dogma dictates that Labour Members do not want them to get £1,100 in vouchers to choose the nurseries of their choice; that they, the socialists on the Opposition Benches, would much rather decide for parents what is good for their children.
Sir Hector Monro: I have attended Scottish Grand Committees for many years under many Governments. Does my right hon. Friend agree that it is good news that we will have real purpose in the future, and that our opportunity to consider legislation and to cross-examine will be extended? Does he agree that attendance by my right hon. Friend the Prime Minister and other Cabinet Ministers in Scotland for cross-examination will enhance the reputation of the Scottish Grand Committee? Does he agree that that is in stark contrast to the proposals of the Labour and Liberal parties for an assembly in which there will be no Secretary of State for Scotland and no one to look after our interests in the Cabinet?
Mr. Forsyth: I agree with my right hon. Friend: he is right. The Scottish Grand Committee is not a Scottish Parliament. It cannot impose tax on the Scots over and above what people pay in England. It is not a Parliament that would mean that people were taxed more because they worked in Scotland than people in any other part of the United Kingdom. It has none of those powers. I make no apology for that. As my right hon. Friend points out, our proposals strengthen the Union, strengthen the accountability of Ministers for what they do in Scotland, and take Parliament to the Scottish people. They are a step forward.
Although I appreciate that our proposals do not do the damage that they want to do to Scotland's interests, I should have thought that Opposition Members would at least welcome them as a step forward. It shows how lacking in confidence they are that they do not welcome the opportunity to call the Government to account in Scotland.
Mr. John Maxton: Madam Speaker, have you noticed how touchy and tetchy the Secretary of State has been in presenting his statement today? Is it not clear—it is certainly clear to all of us on the Opposition Benches and I am sure it is clear to the people of Scotland—that the Secretary of State decided

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that somehow he had to upstage the celebrations tomorrow of the launch of the constitutional arrangements recommended by the Scottish Constitutional Convention, but then realised that he had nothing to say?
All that the right hon. Gentleman could come up with was a ragbag of nothing. Was he not equally aware that the people of Scotland wanted a Government nearer to them and more accountable to them, but, above all, on matters relating to Scotland and within the framework of the Union, a Government elected by them? Until we deliver that, the Scottish people will not be satisfied.
Mr. Forsyth: A Scottish Parliament with a Government elected by the Scottish people is what the hon. Member for Banff and Buchan (Mr. Salmond) wants. If the hon. Member for Glasgow, Cathcart (Mr. Maxton) agrees with that, he should join the Scottish National party. If he is a Unionist, he believes in the Union and the sovereignty of this Parliament. The fact is that he is so damn scared of the nationalists that he is prepared to say almost anything and put at risk our ability to get a good deal for Scotland and ensure that it has a strong voice which is heard in Government. That is what our proposals will achieve.
Mr. David Harris: Government spending in Scotland is 21 per cent. higher than in England. There is massive over-representation of Scotland in this House. Does my right hon. Friend accept that most people in England, particularly in the south-west of England, believe, with justification, that Scotland gets an incredibly good deal from the Government and from the Union? Given those facts, can he understand the pathetic response of Opposition Members to his statement, which clearly strengthens the position of Scotland in the House and in the Union?
Mr. Forsyth: I do not want to alarm my hon. Friend, but the hon. Member for Hamilton has gone round Scotland telling people that the tartan tax might be used to cut taxation. The proposition that he has put to the people of Scotland—we do not hear Labour Members saying it here—is that my hon. Friend will continue to vote 21 per cent. more per head than he votes for his own constituency to a Scottish Parliament and will sit back and watch the Scottish Parliament hand out tax rebates.
If that was not so serious, it would be laughable. The hon. Member for Hamilton is trying to have his cake and eat it. I am afraid that the people of Scotland will lose out if Labour's proposals are ever shown the light of day. It is simply not sustainable to have a Scottish Parliament sitting in Edinburgh the budget of which is determined down here and which is able, even if it raises taxes of 3p in the pound, to raise only 3 per cent. of its revenue. That would be an unstable Parliament, and one doomed to disaster. The most vulnerable people in Scotland would suffer as a result.
Mr. Sam Galbraith: Does not the Secretary of State realise that, while much of what he said about the Children (Scotland) Bill was true, the crux came in Committee when there were controversial issues? The Committee always split along party lines, and the Scottish vote always lost. Does he not realise, therefore, that the real test of his proposal will be whether the Scottish vote in Committee counts, and that the only way to make it count is to hold the Committee stage of consideration of Bills in the Grand Committee? If that is
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not a part of the Secretary of State's proposal, the sittings of the Scottish Grand Committee will be no more than just another travelling talking shop.
Mr. Forsyth: That is a point of view, but it is not a point of view with which I agree. If the hon. Gentleman's position is that the Scottish vote should prevail in determining what happens in Scotland, what would he say to those of my hon. Friends who would say that, in that case, the English vote should prevail in England? [HON. MEMBERS: "Hear, hear."] We have the federalists and the separatists shouting out. That is certainly not a Unionist position. The hon. Member for Strathkelvin and Bearsden (Mr. Galbraith) is an intelligent and thinking Member of Parliament. He should think about how far he is running away from the Unionism upon which the future of our country depends.
Mr. Neil Hamilton: On the basis of the infantile response of Opposition Members this afternoon, if that behaviour is typical, is my right hon. Friend aware that many English Members of Parliament will welcome the opportunity for the Scottish Grand Committee to sit in Scotland as often as possible?
For those of us who represent constituencies which strongly support the Union with Scotland, I should like to reiterate the point that was made by my hon. Friend the Member for St. Ives (Mr. Harris). We are prepared to continue to put up with the over-representation of Scotland in this House, and with the favourable financial treatment that Scotland receives from the British taxpayer, on the basis of proposals which strengthen the Union, but we would not be willing to put up with that if constitutional proposals such as those proposed by the hon. Member for Hamilton (Mr. Robertson), which weakened the Union and moved it towards separation, were brought before the House.
Mr. Forsyth: I am not sure that I agree with my hon. Friend's use of the phrase "put up". This is a Union. We are a United Kingdom, and we are a Conservative Unionist party. Scotland gets a good deal out of the Union, and England gets a good deal out of the Union. The Union is greater than the sum of its parts, and it works.
Opposition Members are prepared—for their own narrow party political ends, because they want to have an entrenched socialist majority in Scotland—to gerrymander our constitution, to put Scotland's vital services at risk, and to play straight into the hands of the nationalists. When the electorate discover that, the Opposition will find that their lead in the polls will tumble.
Mr. Dennis Canavan: If the Secretary of State really believes in people power, does he recognise the sovereign right of the people of Scotland to decide what system of government is best for them, instead of being constantly told what is best for them by a puppet of a discredited Tory regime?
Mr. Forsyth: Apart from the last part of the hon. Gentleman's question, I agree with what he says. If Scotland wanted to become independent, it could become independent. What is not possible is to vote for the ragbag of ill-thought-out proposals that is the Scottish Constitutional Convention, which would result in independence, because divisions would be created between Scotland and England and because damage

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would be done to Scotland's interests. Even on the back page of a supplement that the Evening Times produced on a Scottish Parliament—16 pages of it—we are told, on the sports page:
"Major Scottish disappointments on the international sporting stage could be a thing of the past under a devolved Parliament".
It seems that there is no end to the benefits. If that is true, it may well be that the Scottish people will be tempted.
Mr. Peter Luff: Before anyone comes forward with more radical constitutional proposals—a sensible package has been announced today—does my right hon. Friend agree that they would do well to reflect on the fact that public expenditure in Scotland is some 20 per cent. higher than it is in England? Does he understand that, as an English Member of Parliament, I am very happy to justify that to my constituents as an investment in the Union, but that I could no longer do so in any conscience if there was a Scottish Parliament with Scottish tax-raising powers of its own?
Mr. Forsyth: I am grateful to my hon. Friend. People must realise that the future of the Union is a matter for everyone in the Union. It is not just a matter for Scotland. What is so devastatingly damaging about the proposals of the hon. Member for Hamilton is that they take no account whatsoever of the interests of those from south of the Border. The hon. Gentleman is proposing that Scottish Members of Parliament will come down here with no say in health, education, agriculture or any of the other matters which concern our constituents for the simple purpose of keeping in office a Labour Government by voting on those matters which are in England.
That is an intolerable position, on which the hon. Member for Linlithgow (Mr. Dalyell), when he was the Member for West Lothian, asked his question. After six years of deliberation, the Scottish Constitutional Convention and the hon. Member for Hamilton still cannot answer the West Lothian question. Labour Members want to have their cake and eat it—they cannot have it.
Mr. Alex Salmond: May I return the Secretary of State to his statement? I suppose that any concession—however weak and belated—must be welcomed. But I must say to the Secretary of State that, if this is it after all the build-up, it is not opposition that he is risking today, but ridicule.
Will the right hon. Gentleman confirm that, under his proposals, the absolute Westminster veto over Scottish business remains? If what the Secretary of State is proposing had been in operation during the poll tax debate, would the proposals have gone to the Scottish Grand Committee? If the Scottish Grand Committee had come up with an inconvenient vote on the poll tax, would it have been overruled in this Chamber? Would the Secretary of State have defended his pet project through these processes?
The Secretary of State has sidestepped the question of nursery vouchers so far, but he told us in his statement that Scottish Members could decide on the future of deer. Can he explain to the people of Scotland in a simple
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phrase why Scottish Members should be trusted with the future of red deer but not with the future of Scottish children?
Mr. Forsyth: I said no such thing. Legislation is a matter for this House and this Parliament. The proposals which I put forward allow for scrutiny and debate on matters affecting Scotland in Scotland and involving Ministers. [Interruption.] The hon. Member for Banff and Buchan (Mr. Salmond) has a perfectly honest and responsible position—he wishes Scotland to leave the United Kingdom and become independent. In those circumstances, he would find that he was £8.6 billion short of the money he needed to run Scotland, and the Scottish people would be greatly damaged as a result.
But in those circumstances, a Scottish Parliament would be able to decide on legislation in Scotland. That it is the nationalist position. It is not my position. The position of Unionists is that this is the sovereign House. The hon. Member for Hamilton has got himself into a dreadful tangle, because he has been so worried about the way in which the Scottish National party has been rising in the polls.
Mrs. Margaret Ewing: What about the poll tax?
Mr. Forsyth: The hon. Lady is getting excited about the poll tax. Does the hon. Member for Banff and Buchan remember that the great objection of Labour Members to the poll tax was that we were introducing a tax in Scotland a year ahead of England? But Labour plans to have a tartan tax for Scotland, which, year after year, the Scots will have to pay and the English will not. For sheer brass neck, that takes the biscuit.
Mr. John Home Robertson: After the poll tax and everything else that has been imposed on Scotland in the past 16 years, surely the Secretary of State cannot expect to smother the Scottish constitutional issue in a welter of amendments to Standing Orders in Committees. Does he accept that a Committee is, by definition, a subordinate body? Does he also accept that, under his proposals, it would be open to him and his successors to continue to impose legislation and decisions on the Scottish budget as has always been the case? If he is really serious about addressing the Scottish constitutional issue, why does he not take his seat in the Scottish Constitutional Convention tomorrow, as a representative of a small and dwindling, but nevertheless significant, Scottish minority?
Mr. Forsyth: The hon. Gentleman asks me to take a seat in the Scottish Constitutional Convention. I am told that tomorrow the members of the convention will say that they have reached an agreement.
The hon. Member for Hamilton says that we might have the office of Secretary of State, and that we would keep 72 Scottish Members of Parliament. The hon. Member for Orkney and Shetland (Mr. Wallace), who speaks for the Liberal Democrats on the matter, says that we would have to reduce the number of Members of Parliament, and that the office of Secretary of State would disappear. If they cannot even agree on fundamentals such as those, the convention sounds like no place to he. It has wasted six and a half years, and has still not come up with an answer to the question which the hon. Member for Linlithgow asked.

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The hon. Member for East Lothian (Mr. Home Robertson) may not like being a part of the United Kingdom, and he may not like having this House as a sovereign body. If he feels like that, he should join the Scottish National party, and stop pretending to be a Unionist.
Mr. Calum Macdonald: Does the Secretary of State recognise that nobody objects to him and his colleagues having ideas or plans about education vouchers, local government or the poll tax? What is objected to—following our experience in the past 16 years—is that the right hon. Gentleman is able to impose these policies upon the people of Scotland against the wishes of the majority of the people of Scotland and against the wishes of the majority of Scottish Members of Parliament. Does he not acknowledge that that raises a democratic question about the way in which the House works, which his proposals do nothing whatsoever to address?
Mr. Forsyth: The hon. Gentleman is an honest man, and he is acknowledging the root of Labour's proposals. The Labour party does not like the fact that it is unable to govern in Scotland, where it gets the majority of the vote. But I ask the hon. Gentleman to contemplate what he is saying. If it is the Labour party's policy that we should have a Government who represent the majority in the constituent parts of the United Kingdom, how will his right hon. Friend the Member for Sedgefield be able to govern England as leader of a Labour Government—something that I think is unlikely—who do not have a majority of seats in England? That way lies the break-up of the United Kingdom, and the hon. Gentleman should have nothing to do with it.
Mr. Denis MacShane: As a Member representing an English constituency in Yorkshire, may I invite the Secretary of State to get off at Doncaster when he brings the Prime Minister by the nose to Scotland, to defend the Government's policies to the people of Yorkshire? I am not sure if the Secretary of State realises quite the constitutional innovation he is proposing. He proposes to turn Parliament—or rather, those on the Government Front Bench—into a kind of travelling circus which moves to other parts of the UK to discuss parliamentary and political problems.
We heard this morning an excellent address from the President of the United States, who represents the union of America. America has 52 state legislatures or parliaments with tax-raising powers. If it is good enough for the United States and most other modern democracies, why cannot the people of Scotland have their own legislature?
Mr. Forsyth: Scotland is a country, not a county. That is the difference between Scotland and Yorkshire. I am glad that the hon. Gentleman brought that matter up, because, for a while, the hon. Member for Hamilton—in an attempt to answer the West Lothian question—was telling us that Labour would introduce parliaments in Yorkshire and other counties. But that idea was swiftly abandoned in favour of quangos in the counties of England, and the answer to the West Lothian question was lost. We look forward to hearing tomorrow from the hon. Member for Hamilton what the answer to the West Lothian question now is.
Mr. Charles Kennedy: Let us return to the acid test. If the Secretary of State's revised
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proposals had been in place at the time, would they have enabled Scottish Members to prevent the imposition of the poll tax—yes or no?
Mr. Forsyth: No, as the hon. Gentleman knows. He is fair-minded, and I would ask him to reflect upon the point I made. If we had a Labour Government with a majority in the Scottish Grand Committee, they would be able to do everything that they could do in a Scottish Parliament and more. They could call senior Ministers to account, and could have a Budget for Scotland.
The proposals which the hon. Gentleman supports for a Scottish Parliament would give the Scottish Parliament no say in the most important thing that a Parliament does. This House was established to be able to control and raise revenue. Revenue would still be determined in Westminster under the proposals from the constitutional convention. Scotland's voice in Westminster would be diminished, and therefore our ability to defend Scotland's interests and to hold Ministers to account would be undermined.
Mrs. Maria Fyfe: For the sake of absolute clarity, will the Secretary of State describe exactly how he intends to implement the voucher scheme? In what way is that more democratic than allowing a Scottish Parliament with elected members sent by the people of Scotland to decide how nursery provision should be paid for?
Mr. Forsyth: The hon. Lady has not got the message. Our idea of devolution is taking power from the Government and devolving it downwards to local government and to individuals. Nursery vouchers are about empowering people, while the Labour party wants politicians to decide what is good for people. Nursery vouchers are about giving people the money to allow them to choose for themselves, rather than having them do what they are told by their local authority. That is the sort of devolution that matters—devolution to people, not to politicians.
Mr. George Foulkes: Is the Secretary of State aware that there is a part of the United Kingdom in which Unionism is manifestly even stronger than it is in Eastwood, and that is Northern Ireland? Will he forget about his fixation with our proposal for a moment and explain exactly why the Government are proposing an assembly for Northern Ireland, which will have control over legislation and administration, with no reduction in the number of Members representing Northern Ireland here, or no reduction in their powers, while all he is suggesting for Scotland is a beefed-up Grand Committee?
Mr. Forsyth: The hon. Gentleman is making a comparison with Stormont, but he will know that such a proposal would mean reducing the number of Members of Parliament representing Scotland from 72 to 40—
Mr. Foulkes: The right hon. Gentleman has it wrong.
Madam Speaker: Order. The hon. Gentleman has had his say. He is very articulate. He must let the Minister answer.
Mr. Forsyth: I am not sure that the Leader of the Opposition would find the argument of the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes)

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helpful. The hon. Gentleman has been going around Scotland saying that he is in favour of changing the clocks. It would appear that it is not merely on that matter that he is in favour of keeping Scotland in the dark.
Mr. Tam Dalyell: On a point of order, Madam Speaker.
Madam Speaker: I must call the hon. Member for Motherwell, North (Dr. Reid)—the only hon. Member who has been rising to ask a question, but who has not yet asked one.
Dr. John Reid: Does the Secretary of State really understand the length and depth of commitment behind the case for the devolution of power? It is not just a matter of the past 17 years: it was included in Keir Hardie's first manifesto, as well as the first manifesto of the Labour party in Scotland and, incidentally—[Interruption.]—this will be of interest to Unionists—at precisely the time that Gladstone was suggesting that he might give the Irish devolved powers. Had that happened, they might still be in the Union.
In that context, the right hon. Gentleman failed to deal with two problems. He dealt with scrutiny and accountability, and I welcome any step forward on those—I also welcome what he said today—but he failed to deal with the real question of power and of whether the
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Government are prepared to devolve the power of decision making on purely Scottish affairs to Scotland within the general sovereignty of Westminster. Is he prepared to countenance any devolution of power, rather than accountability? If he is not, and has not today, he might as well not bother putting forward any more proposals.
Mr. Forsyth: I am not a federalist and I am not a Unionist—[HON. MEMBERS: "Hear, hear."] I am a Unionist. [Interruption.] I think that the House knew what I meant to say. I am not a federalist, and I am not a nationalist. I am a Unionist, so I am not in a position to help the hon. Gentleman.
I ask the hon. Gentleman to reflect on one thing on behalf of his constituents, and it is a serious matter. The other day, more than 3,000 jobs came to his constituency, which desperately needed them after the closure of Ravenscraig. They came as a result of a major inward investment project. Scotland was competing with the Welsh, and Wales was a possible site because of the proximity of various glass-making factories.
Does the hon. Gentleman think that, if the Welsh Office had been able to say, "If you come to Wales, you won't have to pay the tartan tax that you'll pay in Scotland," the investment would have gone to Scotland? The Labour party's proposals to hobble Scotland with a tartan tax would destroy jobs and the inward investment on which his constituency depends.

Points of Order
6.5 pm
Mr. Tam Dalyell: On a point of order, Madam Speaker. I want to raise a point of principle about ministerial statements. It may be within your recollection that, an hour ago, the Secretary of State for Social Security was asked a specific question about tax and long-term care benefits. In reply, he said he could not give the figure for which he was asked, because that was a matter for the Chancellor of the Exchequer.
My point of order is this, and it results directly from the Secretary of State's statement. In the eighth part of that statement, he said that benefits from long-term care insurance would be tax free. Should not Ministers who make undertakings in their opening remarks be responsible for the explanation and putting on the financial tag, rather than leaving it to another Minister and saying that they will write about it at some time in the future? That is a matter of principle.
Madam Speaker: It is not for me to comment on ministerial statements—[Interruption.] I am being prompted by Ministers to give the figure. It is not for me, as Speaker, to give the figures. Ministers are responsible for the comments they make at the Dispatch Box. I am sure that the hon. Gentleman may well pursue the matter with the Minister and get the correct reply recorded in Hansard.
Mr. Nick Hawkins: On a point of order, Madam Speaker. You will be aware of the serious events that took place in the Committee Corridor late yesterday afternoon. The hon. Member for Nottingham, South (Mr. Simpson), who is a cricketing friend of mine and has apologised to me, was one of the sponsors of a meeting in Committee Room 14. At the conclusion of that meeting, when those attending were not accompanied by any hon. Member, they refused to leave, thus preventing another meeting taking place, which I and some of my hon. Friends were planning to attend.
The Serjeant at Arms had to be informed, and a large number of police officers summoned. Hon. Members on both sides of the House were prevented from passing and re-passing the Committee Room on their way to and from other meetings in that Corridor. Worst of all, those attending the meeting, who were socialist militants, insisted on continuing, and not only to obstruct the business of this House, but to chant socialist slogans in a most offensive way. That exploded for ever the myth of new Labour.
I know that the hon. Member for Nottingham, South has written to you to apologise, and to indicate his stance on the matter. What steps will you take to ensure that hon. Members are aware that they never allow those they have invited into this place to remain in Committee Rooms unaccompanied by any hon. Member?
Mr. Alan Simpson: Further to that point of order, Madam Speaker. I am grateful to the hon. Member for Blackpool, South (Mr. Hawkins) for raising this matter, and giving me the opportunity to repeat the apology that I made to you in writing last night, to hon. Members who booked the subsequent meetings, which were disrupted, and to the many hon. Members with whom I spoke in the corridors during what seemed to he a large part of yesterday evening.
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I owe the House an apology and an explanation. The meeting was booked—
Madam Speaker: Order. No explanation is necessary. It is perfectly legitimate for hon. Members to book rooms in this House for a meeting. What disturbs the House and me is that the hon. Member responsible for those lobbyists did not see them off the premises. That is the point, and I think that the hon. Gentleman is giving some explanation and making an apology.
Mr. Simpson: Although I had made assiduous efforts to ensure that everyone came in properly, my error in failing to make the exit equally uneventful was seriously misjudged. I was the last to speak at the meeting, and left it only to inform the police and staff on the Corridor that I had been told that those attending were about to depart. My mistake was that I went down to the Lobby to pick up a full copy of the Budget briefing papers.
Only when I was then informed by the Serjeant at Arms that the meeting had not disbanded did I realise that I had not discharged my responsibilities fully and properly, and for that I apologise to the House in the way that I apologised to you last night.
Madam Speaker: That matter was brought to my attention at the time. The hon. Member for Nottingham, South (Mr. Simpson) and I have exchanged correspondence. He is left in no doubt as to what I feel about that neglect of duty yesterday. The matter is now closed.
Mr. Peter Luff rose—
Madam Speaker: Sit down. The hon. Member for Nottingham, South has apologised to the House and to me. I am sure that there are lessons to be drawn from that incident, and that it will not happen again.
Mr. Mike O'Brien: May I draw to your attention an incident in my constituency, on which I wish to raise a point of order, Madam Speaker? Coleshill high school in my constituency received an Office of Standards in Education report from the schools inspector. An attempt was made to withdraw the report a couple of days later, apparently because of some of the contents.
A second report was filed which had had some of the contents of the first report deleted. What was deleted was criticism of the Government.
Madam Speaker: Order. What is my responsibility in the matter?
Mr. O'Brien: I am just coming to exactly that point. The situation raises serious questions about the way in which such reports are prepared and about the whole process. Is it not exactly the sort of—
Madam Speaker: Order. The hon. Gentleman must come to my responsibility in the matter of this report.
Mr. O'Brien: Is it not exactly the sort of incident on which you should insist that the Secretary of State for Education and Employment should make an urgent statement, because it raises such profound issues?
Madam Speaker: I have no authority or influence over Ministers making statements. The hon. Gentleman has not raised a point of order; he has wasted the House's time. If a statement is to be made by a Minister, it is always on

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the annunciator—as today's three statements were—by 1 o'clock on the day that it is being made. Can we proceed with our business, or are there other bogus points of order?
Mr. Luff: On a point of order, Madam Speaker. This is not a bogus point of order. I am sure that the whole House will appreciate the apology offered by the hon. Member for Nottingham, South (Mr. Simpson)—
Hon. Members: Bogus!
Madam Speaker: Order. Allow me to deal with this. The hon. Gentleman will resume his seat for a moment.
Mr. Luff rose—
Madam Speaker: He will resume his seat. If he has a different point of order, I will of course hear it, but the other matter is now closed.
Mr. Luff: My understanding is that the right hon. Member for Chesterfield (Mr. Benn) had also booked that Room, and I hope that you will draw his attention to what you have said about the other matter, and clarify to all hon. Members the fact that, when they make bookings, as the right hon. Member for Chesterfield also did, they have a responsibility—
Madam Speaker: Order.

BILL PRESENTED
  ASYLUM AND IMMIGRATION
  Mr. Secretary Howard, supported by The Prime Minister, the Chancellor of the Exchequer, Mr. Secretary Lilley, Mrs. Secretary Shephard, Mr. Secretary Hague and Miss Ann Widdecombe, presented a Bill to amend and supplement the Immigration Act 1971 and the Asylum and Immigration Appeals Act 1993; to make further provision with respect to immigrants and the employment of immigrants; and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 8.]
Orders of the Day
  WAYS AND MEANS
  Order read for resuming debate on Question [28 November].

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

  (a) for zero-rating or exempting any supply, acquisition or importation otherwise than by—

  (i) zero-rating or exempting supplies of goods which are, or are to be, subjected to a fiscal or other warehousing regime; or

  (ii) zero-rating or exempting supplies of services on or in relation to such goods;

  (b) for refunding any amount of tax otherwise than to persons constructing or converting buildings in cases where the construction or conversion is not in the course of furtherance of a business;

  (c) for varying any rate at which that tax is at any time chargeable; or

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

  Question again proposed.

  Budget Resolutions and Economic Situation
  Madam Speaker: I must put a 10-minute limit on Back-Bench speeches.
  6.11 pm
  Mr. Gordon Brown: The House may recall that in Easter this year the Chancellor of the Exchequer said that the feel-good factor would probably not return for two years—until after the election. We now know what he meant, because the central challenge for the Budget—to acknowledge and tackle the real weaknesses of the British economy—was to encourage new and sustained investment, to close the investment gap with our competitors and to move people out of welfare into work and so reduce the huge bills for social security.
  In yesterday's Budget, however, not only was there no significant encouragement for new investment, and no new plan to tackle unemployment, but the Chancellor had to report that, after 16 years of Conservative government—and after all the boasts of economic transformation—investment, three years into a recovery, is virtually stagnant, rising by only 1 per cent. this year. Public borrowing is now £7 billion above his estimates of the summer. It will be £10 billion higher next year and £10 billion higher the year after. Public finances are in such a poor state that even after a shocking 17 per cent. cut in public investment over the next three years and a 27 per cent. cut in the hospital building programme, he has had to admit that his best chance of balancing the Budget is probably not in this century but at the beginning of the next.
  The Chancellor cannot, because he is imprisoned by his own economic failure, deliver the one measure that Conservative Members were demanding, and looking to for their job security: undoing the damage of the 7p tax rises since 1992.
  Mr. Jacques Arnold: In view of his concerns over public finance, how would the hon. Gentleman finance the £8 billion cost of his 10 per cent. starting rate for income tax?
  Mr. Brown: There is no £8 billion cost of a 10p starting rate for income tax. I will tell the hon. Gentleman what the choices will be at the next general election. HON. MEMBERS: "Answer the question."] I am answering the question. The hon. Member for Gravesham (Mr. Arnold) has a few questions to answer to his constituents about the promises that he made about tax cuts that have never been delivered.
  I will tell the hon. Gentleman what the choice at the next election will be: it will be between what the Chancellor said yesterday—the Conservative plan to abolish capital gains tax and inheritance tax, at a cost of more than £4 billion to benefit only a few—and our proposals to use the same resources to get the starting rate of income tax down to 15 per cent., or preferably 10 per cent. I know what choice, on fairness grounds and on employment grounds, the electorate will make.
  This is not just the 7p up and 1p down Budget. It is not just the Budget that gives—as I will show in a minute—with one hand but takes with another. The Government cannot present the Budget as inspiring, as a turning point
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  or as the 17th relaunch—for it would have been the 17th failed relaunch—so they now to try to salvage it and present it as cautious, sensible and prudent.
  Prudence would have meant that the Chancellor tackled our deep-seated economic weaknesses, that he had a long-term strategy while being cautious in the here and now, but there is no sign at all from his Budget that he has any sense of direction or strategy for the British economy. He cannot be considered prudent if he neither acknowledges nor addresses the fundamental investment and skills gap with our competitors and has no clear direction for this country. He is not a prudent Chancellor with real scope and options that he can consider and reject, for what he calls his prudence is forced on him. He is a man without real choices, a prisoner of his Government's failure, paralysed into inaction as a result of everything that has happened to the economy under Conservative management for the past 16 years.
  Mr. Nick Hawkins: The hon. Gentleman has talked about the need for investment. How will his party's policies to sign up to the social chapter and have a statutory minimum wage help investment? They will ruin investment, especially in manufacturing, and destroy jobs.
  Mr. Brown: It is interesting that the same question that was asked of me last week has been asked this week by a different hon. Member who was not here last week. I will repeat what I said. Britain has slipped from 13th to 18th in the world prosperity league. Of the 17 countries ahead of us, 16 have a minimum wage. The hon. Gentleman must face up to the fact that there is a minimum level of social justice that contributes to economic efficiency in modern economies. The idea that we should return to a 19th century situation, where there is no protection at all for people in the workplace, is unacceptable to this country.
  The result of everything that has happened is that after 21 tax rises—the biggest tax rises in history—with, even this year, as was admitted in a recent report, living standards for the majority still falling, with consumer confidence still weak because of widespread job insecurity and despite all the promises of the Conservatives being the low-tax party, all the Chancellor can offer to undo the damage of a 7p in the pound tax rise from 1992 is to make it a 6p tax rise from 1996.
  People will ask, "What has all the suffering been for?" It has been for one solitary tax cut that cannot mitigate a record of 21 tax rises. Big tax rises followed by a small tax cut still equal a big tax rise since 1992. A tax cut one year in five cannot undo the damage of tax rises in the other years. Three billion pounds given away cannot compensate for more than £16 billion that has been taken away.
  Mr. Tim Smith: The hon. Gentleman says that the 1 per cent. reduction in the standard rate is the only progress that is being made on tax reductions, but that it is not true. There are two other respects in which we shall be moving towards a 20p rate. The tax on savings is to be reduced to 20p, at a cost of £800 million. Will he support that?
  Mr. Brown: The hon. Gentleman raises what the Deputy Prime Minister said immediately after the Budget. The Deputy Prime Minister was sent into the television

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  studios to tell people that they were £9 a week better off as a result of the Budget, but when the Treasury press release was examined immediately afterwards, it turned out that £6.50 of the £9 was an assumption that people were getting a 4 per cent. pay rise and that the tax changes added up to a fraction of the £9 that was mentioned. Taken overall, all the tax changes made by the Chancellor are worth little more than £2 a week to the ordinary family. Many people's savings have been destroyed by the Government; the hon. Gentleman should face up to that fact.
  Mr. Jacques Arnold: Will the hon. Gentleman give way?
  Mr. Anthony Coombs rose—
  Mr. Brown: No, I will not give way to the hon. Member for Gravesham again. I will give way to the hon. Member for Wyre Forest (Mr. Coombs), and then I shall continue my speech.
  Mr. Coombs: The hon. Gentleman talked about savings, but what destroys savings are the inflation rates—about 26 per cent.—that we had under the last Labour Government. Will he tell the House what his target inflation rate would be?
  Mr. Brown: I thought that the hon. Gentleman would ask about the 40 per cent. increase in unemployment in his constituency in the past five years. I will tell him about inflation. We have said very clearly that we will set an inflation target. We shall consult the Governor of the Bank of England and set that rate in government.
  The Chancellor must now explain his inflation target. Is it 2.5 per cent.? If it is, he has gone beyond it and he has failed to meet it this year. There is no guarantee that he will meet it in future years. I thought that the Chancellor might tell us that his inflation target is 1 to 4 per cent., but now he is telling us that it is 2.5 per cent. That is very similar to the memo that he sent to Back Benchers, in which he said that he might meet the 1 to 4 per cent. target on some, but not all, occasions.
  The Chancellor of the Exchequer (Mr. Kenneth Clarke): I did not intend to intervene, but I shall answer the question. The target is 2.5 per cent. by the end of the Parliament and we are on course to achieve it. As I said yesterday, the target will be 2.5 per cent. for the rest of the Parliament. The Chancellor, and not the Governor of the Bank of England, is supposed to set that target. Why cannot the hon. Gentleman answer any of the perfectly legitimate questions that my hon. Friends have put to him? What will he do in the vote on the tax on savings, what inflation target will he set and what is the cost of his proposal for a 10p basic rate?
  Mr. Brown: I have answered all those questions. I thought that, after last night, hon. Members would be more anxious to question the Chancellor about what he has done and what he has failed to do.
  I have made it absolutely clear that we shall consult the Governor of the Bank of England on the inflation target when in government. That is the sensible thing to do. The Chancellor must explain why inflation this year is at 3 per cent. when his inflation target is 2.5 per cent. The
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  Governor of the Bank of England says that he has no confidence that the Chancellor will meet the target by the end of the Parliament.
  I will remind hon. Members about taxation. Despite all the promises of tax cuts, year on year, the tax cuts in the Budget leave value added tax at 17.5 per cent. and VAT on fuel at 8 per cent. Employees' national insurance contributions have risen since the last election and they have not been reduced. Mortgage assistance has been halved and it remains unchanged. The airport tax and home contents insurance tax have not been reduced. Anything that the Chancellor has given this year must be set against what he has taken away. After VAT rises, national insurance rises, cuts in mortgage help, cuts in the married man's allowance and new airport and car taxes, people are almost £700 worse off under the Conservative Government. Having taken the pounds, they are returning only the pennies. People have suffered enough as a result of the Government's actions.
  Mr. John MacGregor rose—
  Mr. Brown: I will give way to the right hon. Gentleman. He is a distinguished former Treasury Minister and I doubt whether he agrees with many of the things that have happened since he left the Treasury.
  Mr. MacGregor: I shall make my speech in my own way, thank you very much. We know that the hon. Gentleman has already committed himself to substantial public expenditure increases. Would he reverse the tax measures that he has just mentioned? Would they become tax reductions if he were in power?
  Mr. Brown: I have committed the Labour party to one measure: the employment and training programme. We would fund that measure—just as the Chancellor should have—with a windfall tax charge on the profits of the privatised utilities. When the Chancellor speaks at the end of the debate, he will have to explain why the Conservative party is always a soft touch for the privatised utilities.
  Let us be clear that what the Chancellor gave yesterday he also took away. The tax cut will be paid for by a council tax rise of 11 per cent.—if our calculations are correct—in some parts of the country. Water charges and rents have increased and there are hidden taxes. Rail fares are up, as are prescription and dental charges. The Chancellor and the Deputy Prime Minister have claimed that we are £9 a week better off. Some people will be better off by £9 a week, but the Chancellor will have to scour the country looking for a whisky-drinking, vintage-car-owning pensioner who is looking for community care and who has assets of between £8,000 and £16,000. Very few people are better off in real terms as a result of the Budget.
  On the fairness of the Chancellor's proposals, it has been reported today that—after all the benefits that they have received—the richest 10 per cent. will gain £7.30 per week and the poorest 40 per cent. will gain only £1.04 per week after the Budget changes.
  Mr. Malcolm Bruce rose—
  Mr. Brown: I shall give way to the hon. Member for Gordon (Mr. Bruce) because he is a Liberal Democrat.
  Mr. Bruce: I am grateful to the hon. Gentleman for giving way. He says that he is concerned about the rise in

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  council tax, which has occurred because of the Chancellor's sleight of hand in putting pressure on local authorities to finance the education budget. Does the hon. Gentleman agree that the education money would be better provided from the 1p income tax cut? Will he join the Liberal Democrats in voting against that 1p reduction, which we believe should go to education?
  Mr. Brown: When the hon. Gentleman makes his contribution to the debate this afternoon, I should be grateful if he would confirm whether he agrees that the assisted places scheme should be scrapped and the money used to reduce class sizes. That is an important change. I should also be grateful if he would tell us whether the Liberal party will go to the next election promising a rise in the basic rate of income tax, as he hinted in his speech yesterday.
  Mr. Bruce: We will tell the hon. Gentleman at the general election. I asked him a simple question. He and his colleagues have said that they want to put money into education and that they do not wish to increase council taxes. We have pledged to vote against the 1p reduction in income tax this year—has he?
  Mr. Brown: Never has an intervention been more telling. The Liberal party spokesman is not prepared to say whether he will go to the next election promising a tax rise. That would be the honest position of a party that has pledged to vote on Monday against the tax changes.
  Let us examine what the changes mean for ordinary people throughout the country. Hon. Members will recall that the Chancellor told us that the tax rises since 1992 should not be exaggerated. He said that, for most people, they amounted to little more than the price of three pints of beer a week. Staying with the pub economy—which the Chancellor finds so congenial and of which he is an acknowledged master—and using the same equivalents, we find that the weekly sums from the tax cuts that he announced yesterday will amount to fewer than two or three packets of peanuts. That is the equivalent of what the Chancellor has done.
  Let us recall what the Chancellor told the Conservative party conference only a few weeks ago. Do hon. Members remember what he said to earn the traditional crouching ovation that he gets at such events? He said:
  "It is a Budget I'm looking forward to a lot more than the last two.
  Many of you feel, I know, that the time has come for some reward in the Budget.
  So far this Parliament we have given you the hors d'oeuvres and not the main course, the trailer not the film, the warm-up not the main performance".
  I can tell the Chancellor that, as a result of yesterday's Budget statement, we have gone straight from the hors d'oeuvres to paying the bill without receiving the main course. We have gone from the trailer to the end credits. People are walking out and there is still no main feature. We have gone from the warm-up to the final curtain, and nothing that the Chancellor has done is worth a single round of applause.
  Mr. Barry Legg: The hon. Gentleman said that nothing that the Chancellor did yesterday was worthy of support, but I remind him that his leader pledged his support for the 1p reduction in
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  income tax. Will the hon. Gentleman tell us whether he believes that that 1p reduction should be financed by less public spending or higher borrowing?
  Mr. Brown: I will tell the hon. Gentleman what we shall do. We shall not vote against the 1p cut in income tax; and I will tell him why. People have suffered enough; they have been punished enough by the Conservative Government.
  I find it interesting that Conservatives—not only Conservative Members of Parliament, but Conservatives in the country—now spend all their time writing to the Labour party. One of my colleagues received his Budget representations, not from his local Labour club, but from Middlesbrough Conservative Club Ltd., founded in 1883. The letter started:
  "The Management Committee of this club are becoming increasingly concerned about the falling trade which has been apparent for some months now. We know that we are not alone in the immediate vicinity. Trade is down by some 8 per cent. throughout the licensing trade in the region. My Committee will be obliged if you will bring this matter to the attention of anyone you think can influence the situation."
  So little faith do they now have in Conservative Members that even Conservative clubs find it necessary to write to the Labour party with their Budget representations.
  What of the fundamental problems that should have been tackled in the Budget, the original causes of the tax increases—the neglect of investment and the failure to get people back to work? After 16 years of promises of economic miracles, what has been done about the central challenges to arrest the decline from 13th to 18th place in the world prosperity league? Where is the investment-rich economy that the Government promised? There has been only a 1 per cent. increase in investment this year, in spite of a promise of a 6 per cent. increase in the summer.
  Mr. Andrew Robathan: Will the hon. Gentleman give way?
  Mr. Brown: I will not give way again. I have given way a dozen times to Conservative Members and none of them—[Interruption.] In spite of their barracking, none of them has acknowledged that they should be returning to their constituents to apologise for what has happened as a result of the Budget.
  We have the slowest increase in investment out of recession since the 1930s, yet there was not one measure, apart from those previously announced, that the Chancellor could genuinely say directly gives attention to spurring investment forward.
  If the Government had been serious, they would have introduced the investment allowances that we proposed in our pre-Budget submission. If they had been serious about infrastructure investment and helping the housing market, they would have considered the phased release of capital receipts to allow local authorities to build. Instead of improving the prospects for investment, however, they have cut public investment.
  Mr. Robathan rose—
  Mr. Brown: I will not give way again.

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  What do the Government offer in its place? The private—
  Mr. Legg: Will the hon. Gentleman try to answer one question?
  Mr. Brown: I have given way many more times than most Ministers are prepared to, and Conservative Members are intent on not allowing me to make my remarks; they are simply trying to disrupt them.
  What do the Government offer in place of the cuts in public investment? They offer the 10th relaunch of the private finance initiative, and not a plan or a programme but a wish list.
  The Chancellor should listen to this. He failed, during three years of the private finance initiative, to deliver projects worth the original sum of £15 billion and delivered only £1 billion—a fraction of what was promised. Having failed to deliver his promise, the right hon. and learned Gentleman simply makes more promises and announces the possibility of 1,000 projects, at a cost of £25 billion. Is it not typical of the Government to seize on the manifest failure of their private finance programme, declare it a resounding success and move it right to the centre of their plans for the future without any sign of how they will repair the failures of the past three years?
  The small print reveals that this is not a programme but an open-ended list of unlikelihood, offering not a plan but what the Budget press statement calls
  "an illustrative list of projects"—
  merely a list of potential partnerships that have been identified. What started as an initiative, followed by the formation of a panel and then a panel executive, has now become simply the announcement of an action plan that will come later.
  Where has that taken us? A car park in Eastbourne; the unpopular Skye bridge. The jewel in the crown appears to be a hospital incinerator built in Hillingdon, which is now the subject of complaints about toxic emissions and is being used by Blue Circle Industries plc more than by local hospitals. Beyond that, we are given castles in the air, when people want projects on the ground.
  Private companies in the construction industry and elsewhere are now longing for the task force, the statement of priorities and the clear commitment to action that the Labour party offers.
  If the Chancellor wants an example of what has happened to the private finance initiative, he need look no further than the channel tunnel rail link. It was launched as a project in 1986, legislation was promised in 1987 and finance promised from the Government in 1993. The bids have yet to be assessed and the builders have yet to be agreed. In September, the Government finally took a decision; they appointed a negotiator to consult and then discuss with prospective bidders. There is no signature and no start, almost 10 years on. Now, as the French travel on their high-speed link, completed before the tunnel was opened, the British link may not be completed until next century—the year 2002.
  Mr. Hawkins: Will the hon. Gentleman give way?
  Mr. Brown: I will not give way any more.
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  What of crossrail? It was first promised in January 1989, the Government gave the go-ahead in 1990 and this year, 1995, it is at risk because of the costs of rail privatisation.
  Public money for the railways should be used not to fund expensive consultancies and the subsidies that will accompany privatisation but to invest in rail transport.
  Why not use money from the venture capital trust and the European investment scheme budget, which has not been taken up, to invest and help small businesses move ahead? Why not bring new technology into schools under competition proposals that my right hon. Friend the Leader of the Opposition has made?
  What is happening to employment under the Government? The best way to save money in the long run is to tackle the £20 billion bill that is the cost of unemployment. The biggest barrier to sorting out our public finances is the billions being poured down the black hole to pay the costs of unemployment.
  Perhaps the Chief Secretary to the Treasury will draw the House's attention to what he said in his pamphlet, "Changing Gear: What the Government should do next" before he landed up at the Treasury. As we are discussing public investment, let me read what he said:
  "In the public sector, a wide range of public investment should be undertaken. Amongst the investment undertaken should be house-building, renovation, insulation aimed at inner-city areas in part at least, road building, other infrastructure work, telecommunications and school equipment."
  The right hon. Gentleman said that it would be sensible to think that £4 billion to £5 billion would be spent on capital projects in the next two years. He continued:
  "If such a policy combined with other less expensive initiatives we suggest elsewhere on training and social policy were to be vigorously pursued, the atmosphere as well as the real economy might well be different at the time of the election, and if we lost, we would at least not have landed ourselves with the permanent stigma of apparent callousness and inaction"—
  exactly the stigma that now threatens to attach itself to the Conservative party as a result of the huge cuts in capital investment for which the Chief Secretary and Chancellor are now responsible. I will tell them how they might begin to tackle the problem. They might do so by adopting our plans to reduce unemployment, especially youth unemployment and long-term unemployment.
  What do the Government do instead? They scrap the community action programme, which was launched two years ago by the then Chancellor in the Budget and which was helping 100,000 people a year. They cut the training budget by 4 per cent.—I am not surprised that the Secretary of State for Education and Employment is now not to speak in this week's Budget debate—and, of course, by freezing it, they scrap the one-parent benefit, which provides an incentive for single parents to return to work. They are making it increasingly difficult for single mothers to take up employment again.
  What should the Government have done? They should have introduced our employment programme, and they should have paid for it with the windfall tax on the utilities. If anyone has any doubt about the case for such a tax, they should look at the profit made by Yorkshire Water. It has increased its profit by 50 per cent.—not by supplying the people of Yorkshire with water, but by not supplying them. [Interruption.] Conservative Members are well aware that the plans to take away the supply of

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  many people in Yorkshire are still on the table, and could be introduced. But how can they defend circumstances in which the profits of Yorkshire Water have doubled, while the service that it is providing is the subject of massive criticism—even from constituents who normally support the Conservative party?
  This Budget is a survival package for the Government, and it has failed. It does not begin to tackle the underlying weaknesses. It does not tackle the investment gap with our competitors; it does not tackle the skills gap, because there is no new measure to deal with post-school training for young people other than the measure to deal with single parents, as the one-parent benefit has been cut.
  In my view and, I believe, in the country's view, the Government have run out of steam and given up on the future. They are not prudent; they are paralysed and powerless—frozen in the headlights of the oncoming election. This is the Budget of a Government who are now a prisoner of failure. The public are not short-sighted, greedy, gullible, easily fooled or forgetful of what has happened. The public do not want to praise this Government: they want to bury them.
  This is a Budget that marks not the beginning of the Conservative party's fight back, but the irrevocable public exposure of its terminal decline. It will be seen not as the brave new launch, the turning point for victory, but as the last-gasp effort of a decaying regime.
  After this Budget, the public know as they have never known before that the long night of Conservative rule is drawing to a close. It is the Budget of a Government with nowhere to go and a Chancellor with nothing left to offer. This Government are in terminal decline: they should go, and go soon.
  6.42 pm
  The Chief Secretary to the Treasury (Mr. William Waldegrave): I always enjoy the speeches of the hon. Member for Dunfermline, East (Mr. Brown). That was not one of his vintage contributions, but I was very flattered when he referred to my elderly pamphlet, produced in 1980. I recommend its approach to my hon. Friends on the Back Benches; it was moderately troublesome to the Government of the day, and shortly afterwards I was given a job. I consider that quite a good way of proceeding.
  I think that the pamphlet makes me look rather good. It sounded rather moderate to me. Given the investment figures in those programmes of the 1980s, the Government have a very good record. And, if we are to go back into the past, we cannot fail to remind the hon. Gentleman that he came to the House on a CND manifesto. Opposition Members always get cross when we remind them of that, but it strikes me as a more fundamental shift in political stance than any that I have made.
  The Budget has three main themes. It keeps spending down, keeping borrowing on its downward path and protecting high-priority programmes; it sets Britain on a course of cutting taxes in a sustainable way; and—through the £700 gain in real income that the average family has experienced since the last election; some £450 will probably be added next year—it continues, in a plausible way, our campaign to reform the way in which government works, so that the state does less but new partnerships are built with the private sector.
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  First, let me deal with spending and borrowing. The Budget keeps borrowing on a clear downward path by keeping tight control on public spending. Lower borrowing will keep pressure off interest rates. That is good news for business, investment, home owners and, above all, jobs. I am sure that the House will be pleased to learn that three building societies have cut their mortgage rates this afternoon; that shows that they support the climate of confidence produced by my right hon. and learned Friend's Budget.
  We have made tough decisions to return public finances to a sound footing. Borrowing always goes up in a recession, but once the recession is over the test of a Government is the Government's ability to ensure that it goes down again. That is what we are doing. We have done it before. We inherited an unsustainable level of public borrowing in 1979. There was a tough Budget in 1981. My noble Friend Lord Howe—ignoring 364 economists, the Labour party and everyone else—tackled the public sector borrowing requirement head on. The consequence was one of the longest periods of growth that we had experienced since the war.
  We are now doing the same. We are already in the fourth year of a period of sustained growth—the steadiest for a generation. Exports are doing extremely well: last year we increased our share of world trade, which is very unusual. Businesses are investing: contrary to what was said by the hon. Gentleman, manufacturing investment was up 12 per cent. this year. As for business investment, an increase of 9 per cent. is forecast for next year. Living standards are improving, and unemployment is falling—and all that is happening without an increase in inflation.
  Mr. Donald Anderson: What is the reason for the continued decline in sterling?
  Mr. Waldegrave: The hon. Gentleman should ask the markets. We do not have targets for sterling. I do not know whether the hon. Gentleman would like to set some targets; would he like sterling to be higher, or lower?
  Mr. Anderson rose—
  Mr. Waldegrave: The hon. Gentleman will find that there are benefits as well as costs. What matters is the inflation target, and the inflation target will be met. I do not think that serious commentators are in much doubt about that.
  We intend to lower the public sector borrowing requirement further. Our goal is clear: we intend to bring the budget back towards balance over the medium term. We have done that before, and we will do it again. Balance should be achieved at the end of the decade; the current balance will be in surplus a year or so earlier.
  Sound public finances cannot just mean ever higher taxes to balance ever higher spending. That is the fundamental difference between Conservative and Opposition Members. We believe that, when the businesses and workers of the country create wealth, it belongs to them. It is their right to keep what they make; Government must take only the minimum that is needed to provide decent services and the essential functions of government.
  The Labour party used—honourably and openly—to believe the opposite: that far more should be done and financed collectively, and less left to the individual. As the right hon. Member for Chesterfield (Mr. Benn) put it

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  in an eloquent speech in the debate on the Gracious Speech, it should be done less by profit and more by collective will. That is, after all, what the political argument has been about for 200 years or so. Now, however, things are alleged to be different. As The Independent recently put it, elegantly,
  "The British Left have at last returned, snout-first, to the politics of the pork barrel".
  That was the view of Niall Ferguson. New Labour claims to want even lower taxes than we do, but with no theory and philosophy to explain it. [Interruption.] If the hon. Member for Edinburgh, Central (Mr. Darling) can prove to me that Niall Ferguson was writing in The Daily Telegraph, I shall withdraw what I said at once.
  Mr. Alistair Darling: The article to which the right hon. Gentleman refers was written by Niall Ferguson, but it was not the view of The Independent. Niall Ferguson is a commentator, and he is entitled to his view. The right hon. Gentleman should not suggest that the newspaper, editorially, took that view.
  Mr. Waldegrave: That strikes me as the feeblest intervention of the afternoon. I thought that the hon. Gentleman was going to point out a serious mistake. Muddling up The Daily Telegraph and The Independent would have been a serious mistake. I do not think that Opposition Members like what Niall Ferguson wrote.
  Labour has now joined in the competition for low taxes, but it has no ideology, no theory and no idea of what that is for. We had about £1 billion of extra spending from the hon. Member for Islington, South and Finsbury (Mr. Smith), who opposed all the savings that my right hon. Friend the Secretary of State for Social Security had made. I think that that is the way in which Labour is proceeding. Its practice is to oppose and sneer at all the savings, and to tell the lobby groups that it is against them, but then to back off and, when its members have lunch with people in the City, say that that was not spending.
  For us, the Budget process starts with the tight control of public spending. We have always fought to keep state spending down. We have always believed that one can provide the services that people want without putting an intolerable strain on the taxpayer. We have always linked that to our fundamental political belief: that in the end big government is not only inefficient but threatens freedom. We do not—as the Opposition do—collect shopping lists of expensive commitments from the lobbyists and pressure groups and then ask the taxpayer to foot the bill. We start with the taxpayer.
  In July, the Cabinet asked the special committee on public spending—EDX—to re-examine public spending. We did so. We found savings. They were not easy. There is very little Government spending that does not have some defender or nothing to be said in its favour, or the House would not have voted it in the first place. But we succeeded.
  Mr. Harry Barnes: The Red Book tells us that public expenditure is to go down by £3.25 billion. Elsewhere, reserves have gone down by
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  £3.2 million. Are we not left with dangerously low reserves? What if the money that is supposed to be saved on social security fraud does not materialise?
  Mr. Waldegrave: That is a perfectly fair point to probe, but I do not think that the hon. Gentleman is right. We have not broken the reserve in any recent years. This year the underspend looks like being about £750 million or £800 million. We thought carefully about a reasonable figure for the reserve, and I can assure the hon. Gentleman that we have one.
  We succeeded in finding public spending savings. My two predecessors did not make my task easier; they had helped the Chancellor to cut projected public spending in his previous two Budgets by £43 billion. None the less, in this year's public spending round, we have gone further and the total has gone up to £53 billion.
  For 1997–98 alone, we cut the public spending control total by £3.2 billion from the ceilings that the Cabinet endorsed at the start of the spending round. That is about 1 per cent. in real terms. It is also £12 billion lower than when we first set plans for that year, two Budgets ago. This year, we predict an underspend of about £¾ billion. Spending this year will be only about¼ of a per cent. higher in real terms than in 1994–95. Over the whole period of the public expenditure survey, our plans represent tighter spending control than at any time since just after the war, when the Attlee Government were demobilising.
  Doing it this way—by real spending control—means that tax cuts are sustainable. In fact, spending controls bring a double benefit: they let people keep more of what they earn; but they also mean government that is smaller, more efficient and less of a burden on people and industry.
  As a result of the drive to greater efficiency, we have been able to cut the cash cost of running Government in each of the next three years. Compared with £15.1 billion this year, next year we will spend £300 million less on Government running costs, the year after £530 million less and the year after that £860 million less—a cash cut of more than 5 per cent. In real terms, the figures are even more impressive. By 1998–99, the annual cost of the civil service will be nearly £2 billion—more than 12 per cent.—lower in real terms than today.
  Mr. Denis MacShane: If public expenditure and the cost of the civil service are going down so dramatically, why, in a written answer that I received today, has the cost of chauffeurs for Ministers gone up by 50 per cent. since 1991? Will the Chief Secretary set an example and occasionally catch the bus?
  Mr. Waldegrave: That sounds like a good subject for a Chief Secretary to look at, and I thank the hon. Gentleman for his helpful indication of where I might look for further savings in next year's expenditure round.
  The savings that we have made will not reduce standards of public services. The citizens charter and the competing for quality review have shown that standards can rise with lower costs. We have already carried out 1,000 competing for quality reviews across Government, covering 70,000 staff. More than £1 billion-worth of business has been won by the private sector, with significant reductions in the costs to the taxpayer. The programme of fundamental expenditure reviews and

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  senior management reviews have led to 20 per cent. cuts in senior staff in major Departments and contributed to the drive for greater efficiency across Whitehall. Other reductions come from better procurement, rationalising functions and reducing the span of Government through privatisation.
  Those reductions build on the Government's considerable success in the fight against excessive bureaucracy: holding down running costs and the number of civil servants. There are now 506,000 civil servants—fewer than at any time since the war, 65,000 lower than at the previous election and more than 30 per cent. lower than in 1979. Numbers will continue to fall as a result of those reductions and should be well below 500,000 next year.
  I heard the hon. Member for Edinburgh, Central mutter about quangos—quite rightly. They are the next target. Central Departments are just one part of the Government machine that we are committed to modernise. Circling each Department are large numbers of satellite bodies, which are commonly described as quangos. They come in all shapes and sizes. Some spend money and run programmes on behalf of Ministers. Some provide services themselves. Some are regulatory and raise income from fees. The great majority consume taxpayers' money.
  The Government have already had considerable success in reducing the number of quangos and improving the efficiency of those that remain, but we intend to make further efforts. We shall review the way in which the administration costs of quangos are controlled. We need to ensure that they are exposed to the same discipline as Departments. We shall consider the scope for further reducing the number of quangos. All are at present subject to periodic review. That process will continue. But we shall look at them in groups to see whether there can be overlaps that can involve removal of whole organisations. We shall help Departments with the effective management of quangos. The efficiency unit in the Cabinet Office will undertake a scrutiny aimed at generating practical guidance on how to improve that efficiency.
  The hon. Member for Dunfermline, East spoke about the private finance initiative, and my hon. Friend the Financial Secretary, who leads on that subject, has been talking about the PFI today. In 1979, the public sector was the owner of many loss-making industries, nationalised by Labour after the war, and which Government should never have owned. Our privatisation programme transformed many of them into efficient world-beating companies, like the present British Steel. Today, we face the challenge of achieving similar improvements in services that the Government have a duty to provide, services for which we must keep responsibility: roads, hospitals, prisons, and a whole range of other things. That is where the PFI can be extremely powerful.
  That policy is now central to the next stage of the reform of government in Britain. Government are often not the best manager and provider of services, whether they are people-intensive or capital-intensive. A huge prize of more efficient provision, giving better value for money, is available if we can harness business management expertise at every stage, to design, build, finance and operate public services. This gives an opportunity to free the public sector to do the things that
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  it is best at, for example, an NHS that is focused on core clinical services rather than the maintenance of boilers and the management of car parks.
  The PFI is gathering momentum and projects are demonstrating good results. We will have about £5 billion-worth of deals signed by the end of this financial year. The scepticism—as exhibited by Opposition Front-Bench Members—that accompanied its growth has been just like that in the early 1980s on privatisation. Opposition Front-Bench Members will find that the programme will work and, in due course, they will probably come to support it. [Interruption.] As they say, some of them support it already. Some of them advocate it, and one even claims to have invented it—the deputy leader of the Labour party.
  We are on course to deliver projects that are worth about £5 billion by the end of March, and there is much more to come. It is not just about capital spending; it is about making the Government more and more a purchaser of public services rather than a provider of capital assets. But even as it is, the policy will maintain publicly sponsored capital at about £224½ billion a year through the survey period—a level, which, in real terms, is higher than almost at any time in the 1980s.
  The other reform relates to the extension of challenge funding, which builds partnerships with local authorities, private business and the voluntary sector. Challenge funding has already been a formidable success in tackling urban regeneration, adding £1 of private money to every £1 of public money invested. We want to see that continue and have announced third and fourth rounds of bidding for the single regeneration budget. Challenge funding has also been successful in the Home Office, in its town centre video camera campaign. That is why we are announcing plans to extend it into the regeneration of deprived housing estates; local employment enterprise and training initiatives by the training and enterprise councils; a new challenge fund for the renewal, repair, improvement or replacement of school buildings; and establishing a network of centres to raise standards of literacy and numeracy.
  Happily, my job is not all about cuts, though cuts are an important part of good government. Good government is also about priorities and ensuring that money goes where it is needed. For example, the Budget demonstrates our commitment to schools. In total, we will increase provision for schools by almost £880 million. Our plans will extend quality and choice in education by funding, among other things, a major new initiative on nursery vouchers, a doubling of the intake of the assisted places scheme, and enabling banks to offer subsidised loans to students.
  Mr. Malcolm Bruce: Will the Chief Secretary confirm that the bulk of the expenditure is to be provided through local authority funding rather than direct Government funding, and that the Government's proposed allocation to local authorities represents no increase in real terms compared with last year? Is not the net effect that education funding will have to come from cuts in local services and an increase in council tax?
  Mr. Waldegrave: There are two separate issues. There is a large increase in central Government grant—the aggregate external finance grant—of almost £1 billion and there is an increase in standard spending assessments. The

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  hon. Gentleman should wait for the Secretary of State for the Environment's statement tomorrow. It will be possible for all education authorities to spend the increase on schools, whatever their budget.
  We are launching two new challenge funds to lever in private money to improve school buildings. As I have said, we have £880 million more for schools. The two principal English Opposition parties—to my knowledge the same thing is happening in Scotland—have been—
  Mr. Gordon Brown: Not in Scotland.
  Mr. Waldegrave: No doubt, different things have been going on in Scotland. The two Opposition parties have been co-ordinating campaigns in the English counties, and probably in Scottish counties, on education spending. I am sure that most of my hon. Friends will have noticed such campaigning.
  We have provided £880 million more and it is fair to ask whether the Opposition want to provide more or less. Perhaps the Labour party wants to provide less because it is now a tax-cutting party. It is now outbidding us on tax cuts, so it might want to spend less. Does it want to spend more? That is a fair question. The Member for Dunfermline, East walked straight past all the questions asked by my hon. Friends and I expect that he will walk straight past this one. Does he want to spend more than £880 million on schools this year? That is not a difficult question, but I do not think that we will get an answer.
  The same is happening on crime. Since we came to office, spending on law and order has more than doubled in real terms. Over the past two years, recorded crime has fallen significantly for the first time in modern years. That is no accident. Police manpower has increased by over 20 per cent. since 1979. Our plans provide for a further 5,000 policemen on the beat over the next three years and almost 4,000 extra prison places. We have consistently backed the police since 1979 and the Budget does so again.
  Can anyone believe that Labour would spend more? Would it spend less? Will we get an answer? I think that the hon. Member for Dunfermline, East nodded. That may be a spending pledge on the police. We should note it. He is now shaking his head, so I think that pledge has been withdrawn.
  Our other consistent priority has been health. Next year, current spending on the NHS will go up by about £1.3 billion—over 1.6 per cent. in real terms. The private finance initiative will bring in at least an additional £165 million in private sector investment. I expect it will bring in even more. As always, the NHS will keep what it can save. The hospitals' target in efficiency gains next year is 3 per cent. or £650 million. That means about £2 billion in a tight spending year in extra resources for patients in the national health service. That is the mark of our commitment.
  Every Labour spokesman competes with us on health spending. However, when the Labour party was in government, it cut nurses' pay. It is the only party in the history of the NHS to cut spending in real terms. The only year that that has happened since the foundation of the health service was 1977–78. However, our record on health spending is better—we beat the Labour party on health spending. We can do that only because we are tougher on spending on lower priorities. The hon.
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  Member for Bristol, South (Ms Primarolo) said as recently as last year that she wanted to spend—rather like the Liberals on education—the product of a penny on income tax on the NHS.
  Ms Dawn Primarolo: We did not say that.
  Mr. Waldegrave: I did not mean "we"; the hon. Member for Bristol, South herself said that she would like to spend the product of 1p on income tax, or about £1.6 billion, on the health service. Since she is now in the Treasury team, she has forgotten about that. She has blotted it out of her memory. The remarkable transformation in the political position of the hon. Member for Bristol, South has been observed with astonishment by those of us in other parts of Bristol in the past few years.
  Ms Primarolo: Read out the quotation then.
  Mr. Waldegrave: I will send the quotation to the hon. Lady. The Government have a clear strategy. [Interruption.] The hon. Lady is presumably saying that she does not want more spending on health.
  Ms Primarolo: That is not the point.
  Mr. Waldegrave: It is the point. Does the Labour Front-Bench team want more spending on health or not? I may be mistaken that a couple of years ago the hon. Lady wanted more spending on health. I thought I was complimenting her because as she was—and still is in reality—a good tough left-wing politician, she would have wanted more spending on health. I am now told that I have misquoted her. I apologise and I withdraw that. The hon. Lady did not want any more spending on health. I entirely withdraw those allegations. We are none the wiser as to whether the Labour Front-Bench team wants more spending on health. We will not learn that.
  The Budget, like its predecessors, is a Budget for jobs and growth. We are keeping public spending down as a share of GDP and keeping taxes down. We believe that that is the way to get more jobs, a more secure economy and better prospects of sustained growth. We point to the success of the economies that follow that line. Keeping public spending down is fiscally responsible; it continues the process of lifting the total burden of government from industry; it helps to make employing people cheaper; it helps incentives for work by taking many of the lower-paid out of tax; it cuts the burden on small business; and it makes Britain Europe's enterprise centre.
  There is a counter-argument. Some honest and intelligent people take a different view; they include the right hon. Member for Chesterfield and the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley), as I read in the Evening Standard. People such as Professor Layard and Professor Wynn Godley take a different position. They argue that higher spending, even with higher tax, will achieve what is needed better. That is a perfectly logical and coherent position, but one with which the Government disagree. That is the ever-present argument between left and right.
  We have not heard those counter-arguments today from the hon. Member for Dunfermline, East. We have heard no alternative political position whatever. All that we have had is the Labour party advocating more spending when

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  it talks to the lobbies; less spending when it talks to the City and it wants to look respectable; and income tax at 10 per cent. when it talks to the media. That fools no one.
  There are two explanations for what Labour is up to. The first is that it has not really changed its policy at all, but knows that it cannot be elected if it shows its true high-spending colours. That is what the hon. Member for Hackney, North and Stoke Newington (Ms Abbott) hopes when she says that she wants
  "Labour to win and Gordon can say anything he likes if he thinks that it is going to win the election; but when Labour is in power they will be looking for other priorities apart from tax cuts."
  That is what the hon. Lady hopes and believes, but that ascribes such low motives to the hon. Member for Dunfermline, East and to the Labour party that I cannot subscribe to it.
  The second interpretation is less Machiavellian and more charitable and therefore the one that I believe. It is that Labour simply has no idea of the implications of what it is doing or saying. All that matters is to look good, like Robert Redford in the film "The Candidate". The hon. Member for Dunfermline, East would be splendid in the role. He might lose a little weight, but he would look very good. The Labour party just strings out the soundbites and who cares if they are contradictory. Like the great Tom Lehrer's song on Wernher von Braun: "Once the soundbites are up who cares where they come down. That's not my department says Gordon von Brown."
  Let us compare a few soundbites. The hon. Member for Peckham (Ms Harman) said on the private finance initiative:
  "It is a privatisation initiative. Its not privatisation by the back door, its privatisation by the front door."
  That is for the scares on health privatisation. On the other hand, the right hon. Member for Sedgefield (Mr. Blair) said:
  "The PFI is right in principle. We have supported it, and in many ways we have been advocating it.—[Official Report, 28 November 1995; Vol. 267, c. 1077]
  The right hon. Member for Kingston upon Hull, East (Mr. Prescott) said, "We initiated it." Those are the soundbites for the City and commentators. The hon. Member for Dunfermline, East has said
  "We also see limited application in provision"—
  he is being very statesmanlike here—
  "for private finance for publicly-led projects in education and health."
  That is not what the hon. Member for Peckham says.
  The soundbite for those who want tax cuts is "7p up for 1p down". That is a neat slogan. But when it comes to spending, they want more on every major programme, as we heard again today. Do they want to cut borrowing faster or slower? They do not know.
  We have just heard the hon. Member for Dunfermline, East promise to do away with a list of taxes which my right hon. and learned Friend the Chancellor had to introduce to bring public borrowing down. He liked none of them, and we had lots of nods and winks that they would all go. Where would the money come from? Having given itself such a contradictory set of slogans, no wonder that the best that new Labour can do is to abstain on the principal issue of this Budget: our judgment that the time has come to return to lower taxes. That is the
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  result of new Labour. It is firmly based on new principles, but when it comes to the big issue, it manages to come to the decisive conclusion to abstain. That is wonderful.
  I shall be interested to see whether Labour Members abstain on the cutting of whisky and beer duties. I expect that they will. We had no answers because they have not decided what to do, which is rather surprising. Nor have Labour Members decided what they will do about the 20p savings rate of tax. They walked straight past that question, too. We had no answer on that or anything else.
  To use the words of Dr. John Wells, an honest adviser to an honest man, the late John Smith:
  "the Shadow Chancellor has been engaged in the truly astonishing feat of trying to present Labour as the Party of low taxation and public borrowing … it is breathtaking. For if a party of the centre-left has any simple guiding economic principle, it must surely be that it stands for a more active state than right wing—and for a bigger share of Government spending in national income".
  That is surely right, which is why my right hon. Friends and I are in the Conservative party. We believe in a smaller state and in less Government spending. What anybody thinks that they would support that by backing the Labour party now is as much a mystery to Dr. Wells and me as it must be to the right hon. Members for Chesterfield and for Sparkbrook—an unlikely but formidable alliance.
  One thing that I can say for sure is that, if this country were to find itself with a Labour Government elected on such a basis—having promised lower taxes and higher spending, with no theory or ideology of any kind to guide them, and no consistency or plan—it would find itself in a world where the soundbite would avail it of nothing. It is called the real world. Labour would be a broken-backed Government within six months, as they always have been before. Today's speech by the hon. Member for Dunfermline, East was not in the real world. By contrast, my right hon. and learned Friend's Budget, like him, is honest, straightforward, robust, and well founded in a commonsense application of sensible principles. That is why Conservative Members wholeheartedly support it.
  Several hon. Members rose—
  Mr. Deputy Speaker (Mr. Michael Morris): Order. I remind hon. Members that Madam Speaker has ruled that, from now on, Back-Bench speeches are restricted to 10 minutes.
  7.12 pm
  Mr. Jim Cunningham: I was interested to listen to the debate yesterday and today.
  As some of my hon. Friends pointed out, council tax payers will bear the brunt of the so-called "1p reduction" in income tax. I am sure that many people will be alarmed at that proposal because they will fear for the services provided by local authorities. It has been suggested that extra money will be provided for education, although it has not been made clear whether that will be ring-fenced, so people in local authorities will be extremely worried about the Budget's impact on their jobs. It will threaten jobs, from teachers to cleaners. Even before the Budget, local authorities in some parts of the country, especially Coventry, had already started looking at jobs, pay and conditions. That did not bode well for lower-paid

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  employees, or the education service and other services. So I imagine that many people in Coventry will be alarmed about this Budget.
  The Budget did not do much for the unemployed, and I saw no reference to investment in young people. Rather, it contained punitive measures against young people as benefits will again be cut. Once again, young people are the whipping boy. One-parent families and old-age pensioners will also carry the brunt of this Budget.
  Over a period of years, the Government encouraged many people, particularly young people, to take out mortgages. Unemployment now threatens their ability to pay those mortgages. Worse, the Government, who say that they support a property-owning democracy, have cut mortgage relief over the past two or three years. If one goes further down that road one notices a little thing called negative equity. The Government have hung a millstone round the necks of many young people who want to own their own homes, yet they call themselves the Government of hope.
  Much has been made of the new initiative, which is actually an old initiative—it has certainly been around for a number of years—called "city challenge". I had always thought that the scheme was designed for the inner cities. The problem is that it is a lottery, so it will not tackle some of the major problems of the inner cities as the Government claim. On the contrary, leaders of city councils may have to wait 10 years before they see results using that method of pouring money back into our inner cities.
  The Government have also made great play of the fact that, over the next two or three years, they will employ 5,000 extra policemen. When that figure is broken down, one sees that cities like Coventry will be lucky to have between 10 and 15 extra policemen. We need more than that to tackle some of the crimes committed in parts of the inner city that I could mention. Ministers have come to Coventry and insulted parts of that city and its population.
  The Government propose to cut some £2 billion from the social security budget. Given that £3.5 billion has been cut over the past two or three years—the past two or three Budgets must be taken together—it means that £5 billion or £6 billion will have been taken from the social security budget.
  The Conservatives claim to want to help the poor and say that they are the compassionate party, but over the past two or three years they have cut housing benefit, which does not help one-parent families, the poor or the homeless. One has only to talk to people who work for charities in any major city to find that, rather than assist organisations like Shelter, or the Cyrenians in Coventry, the Government have cut resources for staff which those organisations badly need. Those organisations not only house the homeless but deal with people with drugs problems. The Home Secretary said that he intends to set up a special task force to deal with drug abuse. If we leave out MI5, that task force must be funded, but there is no reference to it in the Budget.
  The Budget does nothing for industry or to expand our industrial base. Conservative Members often talk about wealth creation, but when it comes to putting their money where their mouths are, they do nothing to help industry, which is crying out for help. It is no good simply tinkering
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  with small measures like corporation tax. The Government must come to grips with the needs of industry, which include money for research and development, and for training. Where will future generations go to learn their skills? The Government have no proposals on that.
  Except for a few hundred houses built while the Government have been in office, when was the last time that council house construction took place or cheaper housing was built for the less well-off? Instead, the Government have introduced a punitive Budget. That is the only way that it can be seen. It is not designed to help the needy, the unemployed, new home owners or local government. Rather, this Budget—I presume that next year's Budget will do the same—is all about tax cutting. That will benefit no one because the Government still owe the public £650 a year, or another 6p, which they robbed them of. They should not forget that yesterday's Budget did the public no big favours. They owed the public that cut in income tax because they ran the country into a £50 billion debt. The Government have the effrontery to tell the British people that they are doing them a favour with these tax cuts. They are not a favour, and the sooner the Government decide to go, the better for everybody.
  7.19 pm
  Mr. John MacGregor: For the record, I have declared in the Register my outside interests, although I do not think that anything I shall say will have a direct impact on them. I congratulate my right hon. and learned Friend the Chancellor on his wise, shrewd and balanced Budget. He is right not to take any risks with inflation or interest rates. The tax reductions have been shrewdly chosen and have many good targets, and I support the priorities of education, health and the police.
  There is much that I should like to say, but in view of the time limit I shall confine myself to a few comments. I particularly draw attention to the measures for retirement incomes and the provision for long-term care. We all know the issues—demographic patterns and the fact that people living longer creates health problems in later life—and we all know about the high cost of community care. That may become one of the most potent political issues over the next 20 years.
  The Chancellor has started to tackle the short-term problem of the feelings of many people who have saved throughout their lives only to see their savings eroded to meet the cost of community care in residential homes. The cost of that may also include the family home. Therefore, I warmly welcome the increase in the capital thresholds from £8,000 to £16,000 and from £3,000 to £10,000. That will bring relief to many people with modest savings. Many such people spoke to me while I was making speeches on that issue in various parts of the country.
  The perception that the family home may have to be sold worries people. That does not always happen, but frequently it does and in due course I should like to see the family home exempted from the needs calculation for meeting the cost of retirement care. At least the Budget has introduced a good measure.
  In the context of short-term issues, I welcome the reduction on savings incomes to 20 per cent. for basic rate taxpayers. It will affect mainly retired people because they are the people with building society deposits and a small amount of equities. The significance of that measure is

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  shown by the actual cost in tax relief, which is £800 million. It is a significant measure that will help many retired people, but the long-term problem is much more formidable. It is essential to start to tackle the issue by encouraging many more families who can afford it to start saving through personal pensions and long-term insurance schemes—not just through TESSAs and PEPs—to meet the cost of retirement care.
  At the moment, only 10,000 to 15,000 insurance schemes are being taken up but I have no doubt that in the next 20 years there will be a much greater need for such schemes. That means introducing tax relief measures to encourage people to save more. I am delighted that consultation documents are to be produced and that a couple of measures have already been suggested. A range of options is possible and I hope that over the year ahead we shall introduce them. An important actuarial point is that the earlier people start to save, the less they need to pay and the more benefits they will receive at the end of the day. Every year lost in encouraging people to take out policies for retirement care is a year lost for many families. Through tax measures and constant education, it is necessary to change the culture among the younger generation towards this issue, because it will have an impact on them. I am glad that the Budget took a step in that direction.
  The second issue also relates to savings and I shall couple it with the Chancellor's remarks about the need for tax simplification. That does not just mean explaining tax measures to make them simpler for professional advisers and the public at large. We need to simplify the underlying structure of the system. In that respect, I should like to highlight capital gains tax. I welcome what has been done about inheritance tax and I hope that capital gains tax can be tackled next.
  The right step on capital gains tax is not to abolish it altogether because there is a real issue in terms of the early years. The right approach is to taper capital gains so that the assets and the capital gains move quite swiftly, say within seven years, out of the tax system altogether. That is a much simpler way to deal with the issue than the current one and I hope that the problem can be tackled.
  The third issue relates to the expenditure plans and it is the source of some disappointment. As a former Chief Secretary, I am fully aware of the difficulties that face any Government every year. I have been in several spending Departments and on the other side of the table, and I understand all the issues. I congratulate the Chief Secretary on his reductions in the overall expenditure plans this year, although part of the contribution is from the contingency reserve. I am sure that he will be very tough on that reserve in the year ahead.
  I support the plans for education, health and the police and it would be churlish of me to single out the area in which I am critical of what has been done. Nevertheless I shall do so to highlight it for the years ahead; it relates to the roads programme. I strongly support the private finance initiative on roads and the concept of design, build, finance and operate. I started them and thought that they would be important in the years ahead. I hope that in due course motorway tolling can be linked to them to produce resources that will enable us to ensure a significant future roads programme. However, I do not think that the PFI and DBFO will be enough over the next three or four years.
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  A substantial number of road projects have been cut as a result of reductions in the programme. That worries me, partly because all over the country there is a need for more bypasses for environmental and other reasons, to relieve towns and villages that are hard pressed by traffic, but also because if we do not maintain a decent roads programme, congestion costs on businesses and the economy will start to grow again. Of course, a cut in the programme also has an impact on the construction industry.
  Over the past 15 years a considerable number of bypasses have been built in my constituency and they have been of major benefit to all my constituents. There have been big improvements to the trunk roads in Norfolk, which were much needed for our economy. We have benefited substantially, but more bypasses are necessary and further improvements, by which I mean mainly widening of the main motorway and trunk road network throughout Britain are required. I hope that in future the Chancellor will look again at the impact of his measures on the profile of the roads programme to see whether more can be done.
  My final comment flows from what the Chief Secretary said in the final part of his speech. In 1987 I was the first Chief Secretary to cost the Labour party programme and I remember the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) looking absolutely astonished at the scale of the programme to which his Front-Bench colleagues had committed him. Over the past few years we have been able to demonstrate clearly that Labour is the high-tax, high-spending, high-borrowing party. It has not changed and I was astonished by the effrontery of the Leader of the Opposition and the hon. Member for Dunfermline, East (Mr. Brown). They have put together a number of tax increases and have clearly implied to the public at large that they will reduce them although, of course, we know that they will not. They attack quite a large number of increases in fares or charges—the hon. Member for Dunfermline, East did that in the debate—and imply that they would not have occurred under a Labour Government. All over the shop Labour is still committing itself to spending. The hon. Member for Oxford, East (Mr. Smith) shakes his head, but I understand that within the past month 40 per cent. of all Opposition speeches have urged higher spending and that clearly shows what they will do.
  Mr. Darling: Will the right hon. Gentleman give way?
  Mr. MacGregor: No. I am almost finished.
  Labour is trying to con the electorate into thinking that it would be a low-tax party as well because Labour Members know that that is politically attractive. However, when one examines the totality of their proposals, it is clear that that could not happen under a Labour Government. They would be back to high tax, high borrowing and high spending. On 10 November, the game was given away on "Clive Anderson Talks Back" by the right hon. Member for Chesterfield (Mr. Benn), who said that at present the Labour party did not want to cause trouble internally because it wanted to return to government, but that when
  "we come to power then you'll find the Labour Party is the same Party it's always been."
  That is true. Therefore, the charge of the Labour party being a high-spending party—
  Mr. Deputy Speaker: Order. Mr. Malcolm Bruce.
  7.29 pm
  Mr. Malcolm Bruce: Following the right hon. Member for South Norfolk (Mr. MacGregor), I support the principle of cutting the roads budget, although we think that the money should have been switched to public transport. I agree with him, however, that that cut should not be at the expense of long-overdue bypasses. It would have been extremely damaging if, as was suggested a little while ago, the Government had frozen all road projects that had not been started. I live in a part of the world where the population has grown by 50,000 in the past 10 years. A number of planned bypasses are just at the point where they should be started and I hope that they will not be further delayed.
  I apologise to the Minister who will reply to the debate because, due to a previous engagement, I will not be here for his speech. No discourtesy is intended. No doubt he will take a free kick at the open goal.
  This is a cautious Budget because it had to be. The Chancellor of the Exchequer knows that the economy is so sluggish that the most important thing that it needs is a drop in interest rates. The Chief Secretary to the Treasury alluded to that and I understand that today the Confederation of British Industry called for a cut in interest rates. I hope that enough room has been created for that to happen. In my alternative Budget, I made it clear that getting interest rates down was the single most important economic priority.
  The other problem and the reason why the Budget had to be cautious is that, although not quite in the terms that the Chief Secretary set out, to some degree, borrowing is out of control. If the Chancellor was not to cause alarm bells in the markets, he had to demonstrate that any changes that he was going to introduce were properly balanced and properly funded.
  Having said that, there is a degree of dishonesty in the way in which the Budget has been constructed and presented. The most specific point is that the borrowing position does not justify the standard rate of income tax cut that has been driven by a political imperative that does not square with the Government's analysis last year. The Chief Secretary's predecessor, speaking in the Budget debate just one year ago—bearing it in mind that he was talking about a forecast public sector borrowing requirement deficit of £21 billion for the current year, which is £1 billion less than his successor is forecasting for next year—said:
  "at those levels of borrowing, no prudent domestic or international observer of the British economy should have expected to see tax cuts … it is far more important … to be right than to be popular"—[Official Report, 30 November 1994; Vol. 250, c. 1237.]
  That is obviously true until one gets to within 18 months of a general election, when clearly it is far more important to be popular than to be right. In the circumstances, inevitably the Chancellor of the Exchequer has been pulled in that direction.
  The Chancellor's own wise men have given him some sort of shot across the bows. In the Financial Times today, Mr. Gavyn Davies of Goldman Sachs says:
  "The target for the public sector borrowing requirement next year … is too high, and should not really have permitted sizeable tax cuts. Also, we have probably reached the point where spending plans have been cut so much they become implausible."
  That is where the Chief Secretary's mettle will be tested. It is much easier to cut off the forecast figures than to deliver them at the end of the day. I am not saying that
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  he will not achieve that, but the specifics of how it will be done have not been set out. In a pre-election year, when unpopularity faces the Ministers who preside over cuts, I predict that he will have difficulty delivering them. Consequently, his borrowing forecasts may yet turn out, as they did last year, to be more optimistic than he hopes.
  Apart from that, the dishonesty involves the fact that on analysis the education commitment is nothing like as generous as the Chancellor sought to make it. The Chief Secretary stated that this was the commitment—from central Government sources, it appears that all that the Government are offering is funding for their pet schemes: the assisted places scheme and the nursery voucher scheme. All the rest of the funding must come out of the local government settlement.
  The Chancellor wished to portray himself as a one-nation Tory keen to protect public services when in reality the best that he has done is hold the health budget just about to real health inflation. Although he has put some additional money into increasing the number of police officers, it is a phased introduction and £20 million is not a huge sum in the context of the Budget and it is against the background of cuts elsewhere in the Home Office budget.
  Nevertheless, we welcome and will support some modest measures in the Budget. In particular—here I take up the comments of the right hon. Member for South Norfolk—the threshold adjustment and the help for the elderly who need long-term care are needed. Some imaginative new proposals, which again were alluded to, go in the right direction for encouraging people to make provision for themselves and for giving them an incentive to do so.
  Not surprisingly, I welcome the 27p reduction in duty on spirits. The Chancellor of the Exchequer did not acknowledge that that was a reversal of the 26 per cent. increase that he introduced last year in a fit of pique after he was defeated on the VAT on fuel issue. Over time, whisky has consistently been our biggest export and home sales have suffered. I am not sure that the Chancellor was being that magnanimous because the indications I have are that his revenue fell as a result of the impact of the tax last year. I hope that he will stop there, listen to the Scotch Whisky Association and reduce duty on spirits so that it is more in line with the alcohol content and the gap is narrowed between beer and wine.
  Overall, the Budget is something of a damp squib. For the reasons I have stated, the cut in the standard rate is not justified. We have consistently stated that we believe that education could be funded. We have said that, if necessary, we would increase taxation for it and we will vote against the 1p reduction in income tax and challenge others to support us in so doing.
  The Budget's most alarming feature was the uprating of the Government's borrowing forecast. That took even independent commentators by surprise. We knew that it was bad, but not as bad as that. The Chancellor is forecasting that next year's borrowing deficit will be greater than his forecast for the outturn this year. This year's outturn is forecast to overshoot by £7.5 billion. The 1997–98 figure shows borrowing at £15 billion, which is three times the level forecast in last year's Budget. In the past 10 years, the average error in PSBR forecasts has been £11 billion per annum, so it is a big variation and not a firm foundation for definite decisions.

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  Frankly, the figures are awful and for the reasons that I have stated they could turn out worse. In addition, the wise men do not agree with the Chancellor's forecast that he can achieve 3 per cent. growth. They forecast 2.7 per cent. I hope that the Chancellor is right because clearly we want the economy to sustain higher levels of growth.
  After 16 years in government, the Tories have not found the holy grail of sustained economic success. Some things are being done. Reform of the trade unions has been very much for the better and my party supported most of those proposals.
  Mr. MacShane: It would, wouldn't it?
  Mr. Bruce: Indeed it would because we believe in democracy, in industrial democracy in particular, and that the country has been dramatically improved as a result of those industrial relations reforms. I understand that the leader of the Labour party and Labour Front-Bench Members also support them, although they fought them all the way at the time.
  The Government have also perhaps helped to deepen the understanding of certain fundamental economic realities such as that enterprises must ultimately make a return on capital if they are to survive. Having said that, the Red Book confirms that the post-war average growth rate of 2.5 per cent. is all that has been delivered under 16 years of Conservative rule. Although there are some important improvements in the underlying economic indicators, we have not yet got to the point where we can say that there is real confidence that permanently low inflation has been achieved.
  When the Prime Minister says that inflation is in the box, he is being a little complacent, given the sluggish state of the economy, which is a major fact or in keeping it under control. As a result of that, the Government have not got to the point where we can say that we have stable and competitive interest rates. One of the reasons is that the Government insist on keeping interest rates under political control. All the indications are that that keeps them at a higher base rate than they would be if they were taken out of the immediate political arena, as we Liberal Democrats would wish.
  Those may be some of the reasons why investment is low—and it is low, historically, across the board. Last year the Treasury and Civil Service Select Committee was sceptical about Government claims that business investment would be 10.75 per cent. Sure enough, that figure was revised to 3.25 per cent—and the investment forecast for the whole economy was revised from 5.75 per cent. to 1 per cent. Although manufacturing investment is on the increase now, that is after a deep recession. As a percentage of GDP, it is still at an all-time low.
  The Government are cutting their own capital spending as a means of helping to get their borrowing under control and trying to justify tax cuts. The private finance initiative has been launched many times, and was originally hailed as a way of boosting public capital spending. The hope was that it would unlock additional resources.
  However, the Red Book shows that the forecast increase in the PFI is exactly offset by the forecast cut in the Government's contribution to capital expenditure, so the PFI is now directly substituting for what the Government would have done, and there is no net benefit in terms of the capital expenditure that might have been delivered.
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  The Chancellor and the Government talk about getting expenditure below 40 per cent. of GDP, but unless they are prepared to explain it, that is a meaningless figure plucked out of the air. If it is to be achieved by economic success, that means reducing unemployment and increasing earnings so that there is less call on the welfare budget, which is obviously the biggest single factor outside the Government's control.
  If that is the plan, we need to know what policies the Government have, which they have not shown us over the past 16 years, to achieve that transformation. But to date they have totally failed to deliver. If there is no such magic new policy—there is certainly no evidence of one—the Government can mean only that they favour transferring more of the cost of health, welfare and public service provision to the consumers of those services. Presumably the provision to some of the most vulnerable people in our society will be reduced too—witness today's earlier benefits statement.
  If that is what the Government are about, their argument may be perfectly honourable and justifiable, but it is not honest simply to call for public expenditure to he cut to 40 per cent. of GDP or below, without explaining how to achieve that. The Budget was a blatant attempt to sell a false prospectus.
  First, the Government claim that there is room for justifiable and sustainable tax cuts, when patently there is not yet. They also claim that spending on health, education, and law and order has been increased. Health has been protected, but spending on law and order has been frozen and, unless the Chief Secretary to the Treasury can clarify the position for me, I shall continue to believe that real investment in education has, if anything, been barely maintained, and may still end up cut.
  The Government claim to be providing a big funding boost for education, but they are doing nothing of the kind. That confidence trick involving education makes Liberal Democrats especially angry, because in our alternative Budget we made a commitment to a £2 billion boost as a minimum requirement for education—to deliver the nursery education that all parties claim to want, but for which only the Liberal Democrats are prepared to identify the funding, to reduce class sizes, and to provide more funding for books and materials, and better-quality further and higher education.
  The Government claim that education will be boosted by £878 million. But the direct Government contribution will be enough only to finance their pet schemes, nursery vouchers and assisted places. All the rest is to come from the local. authorities. The trouble is that this year's allocation to local authorities does no more than reverse last year's cuts. The Government are simply putting us back where we were a year ago.
  Even working on the proposals for this year alone, the figures do not stand up. The Government say that there will be a 3.1 per cent. increase from last year's reduced total Government grant support to local authorities. Out of that, plus their council tax income, local authorities are expected to find an extra 4.5 per cent. for education. As education accounts for about half local authority spending, that means that 2.25 per cent. of the 3.1 per cent. increase should be earmarked for education.
  It does not take a mathematical genius to work out that that leaves only 0.85 per cent. for all the other services—a real cut of almost 10 per cent. That means drastic cuts

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  in local services such as community care, home helps and other essential local services. It also means that council tax will have to rise, and I gather that there is to be an announcement about that.
  So the Government's proud boast of taking a penny off the standard rate of income tax has been made at the cost of a dramatic increase in council tax.
  Mr. Waldegrave indicated dissent.
  Mr. Bruce: The Chief Secretary to the Treasury is shaking his head. Perhaps he would care to tell me why in the Red Book the Government forecast an increase of £900 million in council tax income. That is clearly a sign that they intend to lift the caps, and that they expect local authorities to increase council tax to close the gap.
  The Government hope that somehow or other they will gain the credit for cutting taxes, and still be able to claim that they have increased funding on education, while the local authorities will have to deliver the money and put local taxes up. That is dishonest; it is a sleight of hand—although it is probably typical of what one might expect.
  Government spokesmen have acknowledged the fact that we Liberal Democrats have set out our priorities for the current year in our alternative Budget, which is more than can be said for the official Opposition. We have made clear our desire to have reduced interest rates and permanently low inflation—we agree with the Chancellor about the importance of that. We also stress the importance of bringing borrowing under control. I rather suspect that, because of the pressures that the Chancellor is under, we are now more concerned about that than he is.
  We have set out our priority for an extra £2.5 billion for education, including £500 million to be spent on the fabric of our schools. We propose to take 750,000 people out of tax altogether, by introducing a 50 per cent. tax on earnings above £100,000. We would also harmonise the national insurance and tax thresholds. Disappointingly, the Government have left that area unreformed for a long time.
  We would boost public transport, research and development, health, community care, overseas aid, child care and the spirits industry rather more than the Government have. We would also introduce specific measures to get the long-term unemployed back into work.
  Those are costed, responsible priorities. What a contrast to the official Opposition. Both the other parties are off on the fantasy of trying to persuade voters that we can have higher spending, lower taxes, safe borrowing and a healthy economy.
  The Labour party appears to have written its economic policy in Disneyland. It attacks the tax cuts on the ground that they are not enough, yet intends to abstain rather than support them. If Labour Members want tax cuts, why do they not have the guts to support them? If they do not want them, surely they should vote against them.
  The Labour party explains nothing about how it proposes to cut tax, yet at the same time pledges more funding for education, health, transport and all kinds of welfare benefits. Labour says nothing about borrowing, inflation or interest rates. It wants to defy the laws of economics, and probably the law of gravity too. In its
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  flirtation with Murdoch the Labour party should remember Icarus, who found that when someone flies too near the "Sun" he comes to earth with an almighty crash.
  I believe that British voters are understandably disillusioned with politicians who make false promises that cannot be sustained because they never stood up in the first place. The Liberal Democrats' message is simple: "You know you get nothing for nothing. Good things have to be paid for. If tax cuts are to be sustainable, the economy has to have delivered the fruits of success. So if you vote for the economic policies of either Labour or the Tories you are doomed to disappointment. Liberal Democrats could make all the difference."
  7.48 pm
  Mr. John Townend: The Chancellor of the Exchequer has shot the fox of the hon. Member for Dunfermline, East (Mr. Brown), who expected to be able to stand up and condemn him for a giveaway Budget and an attempt to bribe the electors in order to win the general election. Clearly the hon. Gentleman got it all wrong, because one would not get an enormous number of votes with tax cuts of £3.25 billion.
  My right hon. and learned Friend has acted fiscally responsibly over tax cuts, because he has matched them pound for pound with spending cuts. That should please the markets, and it will give my right hon. and learned Friend a window of opportunity to cut interest rates in weeks rather than months.
  That is vital if the Government are to achieve their target of 3 per cent. growth in 1995. Growth has slowed in recent months. The housing market is flat, the construction industry is in decline, retail business in the high street is weak, business confidence is dropping, and exports are slowing. So a boost to business confidence and consumer confidence is needed. By themselves, £3.25 billion-worth of tax cuts are not sufficient. They need to be accompanied by lower interest rates.
  The Budget should not be judged in isolation. There will be another Budget before the election, and it is imperative that the Government continue to cut public expenditure so that they are in a position to make further tax cuts next year. With regard to specific tax changes, I strongly welcome all of them. They will be especially welcomed by the public who have had to bear three years of tax increases. I should like to mention one or two of those changes.
  I am particularly pleased with the help to be given to businesses and small businesses. The marginal relief on business rates is to be welcomed, although we should look at the whole basis of the calculation of valuation of small shops for rent. At present, they are disadvantaged compared with large shops and supermarkets. The lower corporation tax is also welcome, but, above all, the abolition of inheritance tax on private businesses is long overdue. When the Opposition were in power—there is no doubt about it—many fine private family businesses had to be sold because of the old death duties.
  As a third-generation wine merchant, I am delighted that my right hon. and learned Friend the Chancellor has cut whisky duties. I am also relieved that there have been no further duty increases on beer and wine. But the long-term problem of higher duties will have to be dealt

  1275
  with—I had hoped that this year the Chancellor might have made a start—because smuggling is increasing rapidly.
  What worries me, with my experience of the industry, is that criminal elements are becoming involved. We all remember what happened during prohibition in the United states when the Mafia got involved in the drinks industry. The Mafia did not go away when prohibition ended. At some stage we shall have to deal with the problem. We cannot have an open market. Our own industry has been put at a disadvantage. We do not need to come down to the level of duties of the continentals, but we need to halve the difference. We could do that at one stroke if we put 1 per cent. on VAT. I do not expect my right hon. and learned Friend to do that. Nevertheless, the problem will not go away.
  As a Member who represents a constituency where retirement is a major industry, I agree with my right hon. Friend the Member for South Norfolk (Mr. MacGregor) and strongly welcome the changes with regard to the level of assets in old people's homes.
  I turn to direct taxation, which is one of the most important aspects of the Budget. I do not think that it has got home to many people that we now have a basic 20p tax rate for all savings. On all savings—in building societies, banks and shares—people will pay only 20 per cent. tax. That is a great achievement. The widening of the band brings the day nearer when the majority of people will pay a 20 per cent. tax rate.
  We have heard all about the so-called 10 per cent. rate that the Labour party is proposing. It is a confidence trick. I have been on a number of media shows—television and radio—in recent days with members of the Opposition. One member of the Opposition Front-Bench team said, when challenged about how much the rate would cost, "Ah, but it is only going to be a band." A band can be as little as £500 or £1,000, which would produce only a 10 per cent. tax saving. The proposal is a confidence trick, and it is dishonest.
  There is complete chaos in the Labour party. I was also on television with the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley), who said that Labour should cut taxes at the low end and pay for them by increasing them at the upper end. I think that the right hon. Gentleman represents—probably—more members of the Labour party than the Leader of the Opposition.
  I want to say a little about spending, because, in view of my long-expressed views, I am naturally disappointed that reductions in public spending were not greater. I am a little perturbed that the results of the very good work done by my right hon. Friend the Chief Secretary to the Treasury on cutting departmental spending were completely absorbed by increases in the priority areas of education, health and the police. All the tax cuts were financed by reductions in the contingency fund.
  However, it would be churlish to ignore the Chancellor's achievements, for this is the first time since Mr. Healey capitulated to the International Monetary Fund and cut spending over two years by 8 per cent. in real terms that general Government expenditure has been cut in real terms by 1 per cent. If that was the beginning of year-on-year reductions, I would be delighted. However, I find it disappointing that, after a 1 per cent. cut this year, the Red Book shows that, in the following two years, spending is set to rise again by half a per cent. each year.
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  The Government must give priority to reducing taxation. If one turns to page 88 of the Red Book, which shows tax revenue as a percentage of rises in gross domestic product, one sees the mountain that we have to climb to return to a lower tax regime. In the four years to 2000–01, tax as a proportion of GDP is projected to rise to 39 per cent.
  We have to kill the doctrine of the inevitability of rising public expenditure. We need to change the culture in the public sector of "what matters is what we spend"; that things will be better if we spend another £1 billion on health or on education. We should concentrate on output, and what is achieved. When one considers how much we are putting into education, some of the recent reports on the standard of reading and spelling are very worrying.
  We must judge a service on its output rather than its input. In the long term, we must take a long, hard look at spending on education and the national health service, as we are doing with the social security budget. There is no doubt that, although they are priority areas, they are very big organisations. I am sure that there is as much waste and over-management in those areas as there is in any other.
  We still have a few sacred cows. In overseas aid, there have been no cuts in bilateral aid, and the Red Book says that we are the fifth largest donor in the world. We are also told that we are the 18th wealthiest country. Furthermore, some of the money donated is wasted. "The Cook Report" on television last night was very interesting, because it showed that £1 billion has been wasted in Albania.
  I draw my right hon. Friend the Chief Secretary's attention to the fact that he should look next year at Scotland, Wales and Ireland. We all know that expenditure in Scotland costs 30 per cent. more per head than in England. Expenditure in England is just over £2,000 a head, in Scotland it is £2,900 a head, and in Wales it is £2,365. Yet expenditure per head in Northern Ireland is more than £5,000 a head, which is set to be increased under existing plans by adding £130 million this year and £190 million next year to the budget. There should be a peace dividend from Northern Ireland—at least they are not blowing everybody up.
  We have started on a long journey to bring taxes down eventually to below the level they were at the last election. That must go hand in hand with reducing spending as a proportion of GDP and progressively continuing to move, as my right hon. and learned Friend the Chancellor plans, to a balanced Budget.
  We have no differences in our party on those aspirations. My right hon. and learned Friend and I agree. The only slight difference we have is the speed at which we travel. But it is vital that we make a major stride forward in next year's Budget and then set out our programme for the next five-year Parliament to bring taxation and spending down in the long term to or below 37.5 per cent. of GDP. I strongly support all the taxation measures in this Budget.
  7.58 pm
  Mr. Thomas McAvoy: We have just had a demonstration of what the Chancellor called "the slash-and-burn tendency". The remarks of the

  1277
  hon. Member for Bridlington (Mr. Townend) about Scotland and Wales, and especially about Northern Ireland, were clearly misjudged.
  I regret that the Chief Secretary is not in his place, since I took what he said at the start of his speech as a serious confession. He said that he had attacked the Government in 1980 purely and simply to get a job with them. Of course, he eventually succeeded. It certainly told me a great deal about his inner strength.
  The right hon. Gentleman is the Chief Secretary of a Government who have increased taxes over the past three years, after they made an election manifesto commitment not to increase taxes. Some measure of humility might have been in order. Although it might have been hard for someone from the Chief Secretary's class to make an apology to the country, he might have said with some humility that the Government were responsible for those tax increases. The nemesis of the Government will come sooner or later, but it will certainly come; and the Chief Secretary's nemesis may come even sooner.
  The Chancellor realised early on that the British people would not be fooled by the tax cuts that his Back Benchers wanted. He knew full well that to come up with those tax cuts, even against the fiscal advice of his own Back Benchers, would have told on him, because the Government still have around their neck the fact that they have increased taxes by the equivalent of 7p on the basic rate. I know that they do not like us to repeat it, but that figure should be repeated again and again. Even after the Budget, with its certain level of tax cuts, a typical family will still be worse off by £670 per annum. That is the measure and the achievement of the Conservative Government.
  Another reason—I hope, the most important reason—that the Chancellor took into account in his decision not to cut taxes further was the amount of debt that the Government owe. For years, the Labour party has had to withstand lectures from Conservative Members that it was not fiscally correct, could not run a Government, and could not handle the finances of a Government or run the country. When I think of black Wednesday and the state of the Government, I am not inclined—more importantly, the people of this country are not inclined—to listen to lectures from any Conservative Member, and especially from those on the Government Front Bench, with their record of running the country.
  I do not see anything in the Budget to help industry in my constituency. The Hoover domestic appliance plant, which has an excellent export record, is in my constituency. I do not see any measures to help that company to operate and expand its market. The company and its work force have an excellent export record. I do not see any measures from the Government to help such companies. There is not much joy for my constituents in the Budget.
  The hon. Member for Bridlington mentioned spending in Scotland. It is a fact of life that the Scottish Office, according to the expenditure plans announced yesterday, faces a sharp reduction in its annual budget over the next few years as a result of an overall cut in Government spending. Although the Secretary of State for Scotland—as a tactical move—chose to stress that the £173 million
  1278
  increase in cash terms in next year's total allocation was the highest ever, the fact is that the amount of money allotted pro rata to the Scottish Office has been reduced.
  The Secretary of State has failed to fight his corner, and he has failed to fight Scotland's corner. The figures show that the Secretary of State for Scotland has had to accept a £320 million cut in real terms to next year's budget, and his Department faces cuts rising to 5 per cent. in the financial year 1998–99. The Secretary of State has failed to fight his corner against the Treasury.
  I echo some of the comments made by a former Secretary of State for Transport, the right hon. Member for South Norfolk (Mr. MacGregor), about cuts in the roads programme. I am a member and a supporter of the west coast main line group. I support rail services. I do not support motorway madness or roads for their own sake.
  The fact of life is that the economic life of this country depends on an efficient road system for industry and commerce. Now we have a £4 billion brake on new routes because of cuts in that programme. That is purely and simply a short-sighted, short-term measure to respond to an immediate situation. The Government are putting off the evil day, because they think that we can do without the roads for another year or so, but damage will be done to haulage, freight companies and the economy as a whole because delays and traffic jams result in so much cost to the country. The Government's decision is short-sighted.
  I know that the environmental lobby will argue, with some justification, about a reduction in road traffic. The Government have not mentioned the excellent report by the RAC, in which it suggests ideas which would cut car journeys by 20 per cent. I am in favour of cutting car journeys. It is ridiculous that an organisation such as the RAC, in a genuine attempt to tackle the problem of traffic, can come up with innovative ideas and methods that sometimes go against the interests of the car owner, when all that the Government can come up with is a £4 billion cut in the roads programme.
  The hon. Member for Gordon (Mr. Bruce) is not in his place. He was in the Chamber for some time, waiting to speak. I am sorry that he is not here. I am sick to the teeth of the hypocrisy of the Liberal party, which preaches one thing in one area and something else in another. The hon. Gentleman said that his party was in favour of cutting the roads programme, yet the Liberals make a special case wherever it suits them to do so. In my constituency, the Liberals are campaigning against a project to complete a 12-mile motorway link. I welcome the hon. Gentleman's comments, but some motorway building is essential.
  Mr. Eddie Loyden: Does my hon. Friend think it a good idea that we should begin to consider reviving the coastal merchant fleet? It is the most environmentally acceptable method of transport and one that we should fight for. Places in Scotland and the rest of the United Kingdom would benefit from shipbuilding. Coastal vessels could transport most of our goods around the coast without all the environmental problems that roads bring.
  Mr. McAvoy: I am grateful to my hon. Friend for that brief intervention—I think. I look forward to intervening in his speech at some point, especially during a 10-minute limit on speeches. My hon. Friend's point is correct. We have under-utilised resources and methods of transport

  1279
  such as that mentioned by my hon. Friend. The Government's short-termism has failed to take account of that.
  Of all the Budget measures announced by the Government, the one that describes the Government and their ethos best is the cuts in special benefits for lone parents and in housing benefit for the under-25s. That is a disgrace. The Chancellor claims to be a one-nation Tory. The nation will pay the price of treating its young people in that way, and the Government will certainly pay the price, too. Despite the Government's efforts to discourage that section of the population from registering, young people will fall over themselves to make sure that they are registered somewhere in time for the next general election. That will be their chance to seek revenge on the Government.
  8.7 pm
  Mr. Robert Hicks: The Budget confirms that my right hon. and learned Friend the Chancellor is determined to secure sustainable economic growth in a low-inflation environment. If, as a consequence of the measures announced yesterday, we can expect further reductions in interest rates sooner rather than later, that is to be welcomed.
  Much has been written and spoken about tax rates. Given my right hon. and learned Friend's approach and his wish to help specific sectors of the economy and particular groups, he was right to limit the reduction in the standard rate to 1p. As the parliamentary representative for a low-income area, I have always argued that in a tight financial situation it is more important to increase personal allowances than to cut tax rates. I welcome my right hon. and learned Friend's decision to increase personal allowances above the level of inflation.
  I am pleased about a number of other measures, one of which specifically relates to the proposed assistance for people in residential and nursing homes. The existing financial arrangements are certainly too harsh in their application, and they undoubtedly penalise the thrifty and cause widespread anxieties among families. On public expenditure, I welcome the Chancellor's decision to make additional financial resources available in real terms for education, health and the police. There will be widespread public support for that decision.
  The purpose of my speech is to make a number of comments about public expenditure as part of the unified Budget as it relates to the economy of the south-west, and Devon and Cornwall in particular. The House will know that, historically, the economy of Devon and Cornwall has been dependent upon primary activities such as agriculture, fishing, mining and quarrying, and later on tourism and defence.
  The south-west is the most dependent of all the United Kingdom regions on defence and defence-related economic activity. The changes in the United Kingdom's defence requirements have led to the loss of some 21,000 defence-related jobs in the past 10 years, with further reductions of 20 per cent. forecast between now and the year 2001. The loss of income to the local economy through defence reductions is estimated to be in excess of £500 million.
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  Unemployment levels in Devon and Cornwall are traditionally higher than in both the official south-west region and the United Kingdom as a whole. Forty-eight per cent. of the travel-to-work areas in Devon and Cornwall feature in the worst 33 per cent. of the United Kingdom's unemployment black spots. Conversely, average earnings in the area are significantly below the United Kingdom national average. In my constituency, average earnings are 16 per cent. below the national average.
  It is often said that our cost of living is lower. I wish that that were the case, but nothing could be further from the truth. The cost of living in my area is some 8 per cent. above the United Kingdom average, and this is compounded by the wide discrepancy in average council tax bills. For example, the average council tax bill in Cornwall last year was £447, which was 51 per cent. above the average in South Glamorgan. I would hardly consider Cornwall to be a spendthrift county, and it is more likely that this significant differential reflects a more favourable grant settlement for Wales than for England.
  While I am not seeking on this occasion to question the overall level of public expenditure, I am seeking to influence Ministers to agree to a more equitable distribution that takes into account the genuine needs of the far south-west. It is only right that we in the far south-west do everything within our power to help ourselves, and this we will do. Indeed, the fact that we are helping ourselves will be evident from our tangible achievements in attracting foreign inward investment into Devon and Cornwall.
  A total of £48 million of inward investment was gained last year, which resulted in the creation of 895 new jobs and the safeguarding of a further 550 existing jobs. The figures for the year beginning April 1995 are even more encouraging. Some £64 million in investment has been gained so far, leading to the creation of 1,237 new jobs and the safeguarding of 595 jobs. That is excellent news, and it is evidence that we are prepared to help ourselves. But just as the UK's industry, commerce and business in general seek a level playing field in their dealings with our European Union partners, so Devon and Cornwall require the same conditions in terms of the support we receive from the Government through public expenditure compared with the funds allocated to other parts of the United Kingdom.
  I shall provide the House with two sets of figures to illustrate the existing unfairness. Last year, Devon and Cornwall received less than 1 per cent. of the national single regeneration budget, despite having almost 3 per cent. of the United Kingdom's unemployed people. Yorkshire and Humberside—with approximately the same percentage of unemployed people—received £19.2 million, or four times the allocation for Devon and Cornwall.
  Secondly, taking Government aid and support as a whole, Devon and Cornwall last year received just £50 million in total, compared with £187 million for Wales and £530 million for Scotland. All these figures are taken from either the reports on the regional economy prepared by the Plymouth business school or the two independent reports prepared by Coopers and Lybrand. In addition, our regional daily newspaper, The Western Morning News, initiated in September a responsible and objective campaign for a better deal for the far south-west.

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  The Prime Minister and senior Ministers are aware of the findings of the independent reports, but there is increasing frustration and anger manifesting itself within the far south-west about the inability or unwillingness of the Government to respond to our genuine economic and social needs. When the Prime Minister received these reports 12 months ago, he said:
  "We shall certainly take account of your points in allocating resources".
  We are at that time in the political calendar when the decisions determining public expenditure allocations are made. I just hope that due consideration will be given this year to meeting the requirements of Devon and Cornwall.
  8.17 pm
  Mr. Harry Barnes: The speech of the hon. Member for South-East Cornwall (Mr. Hicks) was very different from that of the hon. Member for Bridlington (Mr. Townend). It was not just that the hon. Member for South-East Cornwall made a constituency speech, but that he referred to equitable distribution and how that related to the income tax provisions. Those points were entirely absent from the speech of the hon. Member for Bridlington, and I found myself at the opposite end of the political spectrum from every point made by the hon. Gentleman in his speech.
  I wish that there was greater honesty from the Government in our Budget debates in the House. I realise that, in politics, that may be a wild wish, but we seem to have moved into a dangerous era of news management. We have had a Budget statement and debate in which some of the priorities have not been referred to at length. We have spent a lot of time debating the extra 50 per cent. on strong cider that will raise £5 million, and we have almost passed over what is happening with regard to VAT. Only one brief reference was made to that matter, although there are some proposals in the Budget which are aimed to raise £600 million by altering the accountancy schemes that operate in the collection of VAT. That is quite important. Will the scheme function? We are talking about a large amount of money.
  News management does not merely take place when the Chancellor is addressing the television cameras in here. When we get to look at documents relevant to the Budget in the Vote Office, we find that some are press releases that are intended as news management. The Treasury argues that the average family will be about £450 a year better off and certain newspapers will pick up on that, but when one reads the qualifying remarks, one finds that it is talking about hoped-for economic growth, improvements in wages and other provisions and that that is what it is all about. Really, when one talks about the financial consequences of the Budget for an average family, if there is such a thing, one should consider the amount of money that will result from the Budget itself.
  What was to be the Chancellor's final word on tax cuts? That was what everyone was concentrating on. We discover from the Red Book that, all told, income tax cuts account for about £3.7 billion. More than half that amount comes from the avenues that the hon. Member for South-East Cornwall mentioned and from alterations in the bands and allowances. That is interesting because, if
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  we had had none of that, we could have had a tax cut of 2p in the pound instead, which was the headline that many people were looking for.
  At least the cut in the Budget shows that the Chancellor is giving some consideration to other factors that need to be taken into account, although the Budget is generally entirely inadequate and inappropriate for our needs and does not do anything for investment and growth, as the Opposition Front-Bench team has said.
  Where does that £3.7 billion come from? As I said in an earlier intervention, £3.2 billion is from the reserves. I do not want to over-egg the argument because there are some technical reasons why it is as much as that. Higher figures are given for reserves for the year ahead and the year ahead of that. As one moves into the fresh year, one always takes a certain amount of money out of the reserve, but it is a fact that, at the time of the autumn statement in November 1992, the contingency reserves stood at £4 billion and they are now down to £2.5 billion. Those reserves are gradually being raided and we may be in a precarious position if some of the other items contained within the Red Book do not function properly.
  That is a serious consideration and it seems to have been recognised in a number of contributions tonight. People realise that that is where the money is coming from. If all of it has not come from raiding the reserves, at least a part of it—the tax cuts—has, and I do not think that that is a healthy position for us to be in, especially as some of the rest is expected to come from tackling social security fraud. Hon. Members have already expressed doubts as to whether it will be tackled to the extent indicated. So there seems to be something economically dodgy about balancing the amounts.
  On the equity considerations, the arguments expressed by the hon. Member for Gordon (Mr. Bruce), the Liberal Democrat spokesman, are important. We have been told that local authority expenditure on education will increase by something like 4.5 per cent., which is an increase in monetary terms. When we take into account inflation rates, it becomes an increase of about 1.25 per cent. The problem is that the latter figure is then tied in with the local government figure. We are told that local government expenditure will increase by 3.3 per cent.—just a little ahead of the inflation rate—so there will he no increased money for local government, although education has been granted that increase in expenditure. Cuts will therefore have to be made in other areas.
  In one area—the fire brigade—equity runs in favour of Cornwall and not Derbyshire. The length of coastline is taken into account in the formula. Cornwall has a considerably longer coastline than Derbyshire, which is in the middle of the country and so has no coast at all. On grounds of equity, it seems that that arrangement should be altered.
  It is little wonder that some money is being found for education, given the organisation, petitioning, lobbying and demonstrations with which parents, children and teachers have been involved. They have got some response. As always with this Government, however, when one gets a response in one area because of pressure, there have to be cuts in other areas—often areas of considerable need.
  In Derbyshire, we have considerable problems in other areas, such as social service provision. I believe that tomorrow we will hear an important statement from the

  1283
  Secretary of State for the Environment, which concerns district councils and will be of vast importance to Derbyshire. The problem is not only the size of the total bill and whether it is being raided in areas other than education, but the massive problem of the avenues of distribution, which is of considerable importance in Derbyshire.
  North-east Derbyshire has one of the worst-funded district councils in England per head of population. It is unbelievable when one considers the nature of the area. I know how it works because I know something of the nature of the formula that operates. It is a fiddled formula and happens to hit us from all directions.
  We need a more open and honest Government, who will explain what they are up to and are not merely trying to manoeuvre and manipulate people when they produce Budgets. Greater expenditure is justified in many areas, such as overseas development. The peace dividend in Northern Ireland should be spent in Northern Ireland. Those are the sort of things that we should be able to get our teeth into in these Budget debates.
  8.27 pm
  Sir Andrew Bowden: There is no question but that the Chancellor presented a highly responsible Budget yesterday in the face of a propaganda campaign conducted by the official Opposition in which they claimed that everything that the Government have done and said in the past six months was designed purely to provide massive sums of money for huge—and irresponsible—tax cuts. Yet again, they have been shown to be totally wrong. I hope, however, that the Chancellor will be able to follow it up in the very near future with a significant cut in the interest rate.
  On education, we must be careful to recall that we are talking about expenditure in the next financial year. There is every prospect that, in that financial year—beginning April 1996—the inflation rate will not be in excess of 2.5 per cent. That means that the increase in expenditure on and money made available for education will be nearly double the rate of inflation. Local authorities will certainly be able to maintain services in their areas and, in many cases, they will be able to improve them.
  In East Sussex, which covers my area of Brighton, the settlement exposes the hypocrisy of the campaign organised by the controlling political parties on East Sussex county council, which have been going around Brighton and the county saying that, within the next three financial years, there will have to be massive cuts in expenditure on education. They were talking about £24 million pounds. Such a cut was never going to happen and the new announcement of the money that is to be available has shot the campaign to pieces.
  Unfortunately, many parents were seriously worried and upset by what I can only describe as a scandalous campaign. We now need a community campaign in East Sussex and Brighton conducted by parents, school governors and teachers to ensure that that additional money is spent in the county's education budget. Without one, I suspect that the county will find excuses for not doing so.
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  I want now to deal with pensioner issues. I warmly welcome the proposals on long-term care. They will give many families more financial security and greater peace of mind. The director general of Age Concern England, Sally Greengross, stated:
  "Older people who are worried about paying for care will be delighted to hear the proposals in regard to the capital limits for residential and nursing home care."
  That is indeed a major step forward, but it is just the first step.
  The Government have said that they are preparing a consultative document on some of the problems of long-term care. I hope that that document will contain a range of proposals and possibilities so that there can be widespread consideration of the options. I hope that the document will include the possibility of people being able to buy equity in residential homes and/or to purchase a room in a residential home. That would help many people to preserve part, if not all, of the capital derived from the property that they owned and, when they died, the proceeds of selling their equity or room in the residential home could be passed down in the family.
  There are two groups of pensioners that concern me deeply. There are those who do not claim income support when they could and those who have a few pounds a week above the income support level. Many of them will be worse off than people in receipt of income support. We have not yet found a way of giving the help and support that we should to those sections of retired people.
  I am upset with one thing in the Budget—the Government's decision to cut the home energy efficiency scheme. Until the Budget, it was open to pensioners as a whole. Now, as I understand it, it will be limited to those on income support. That will create hardship and difficulties for those who do not claim income support when they could and for those who have only a few pounds a week above the level of income support. I submit to the Government Front Bench, with great respect, that that should be carefully reviewed. I hope that the decision will be reversed.
  The payment of council tax on elderly relatives' annexes is another matter that has not been clarified by my right hon. and learned Friend the Chancellor and it needs to be clarified as quickly as possible. A compromise might be that, if a flat can be sold separately, it should be liable for council tax, but if it cannot be sold separately, it should not be liable for council tax.
  The Budget is a harbinger of good things to come. The country can be grateful that we have a Chancellor with great courage and integrity.
  8.34 pm
  Mr. Bill Etherington: When the Chancellor of the Exchequer made his statement yesterday, I took particular note of two sentences that he uttered early on. He said that he would seek
  "greater wealth and personal prosperity in which all can share"
  and that he would like to
  "give the weak and the less fortunate a helping hand."—[Official Report, 28 November 1995; Vol. 267, c. 1055–56.]
  I am afraid that, given the use of those terms, the Chancellor's statement was disappointing and, indeed, a miserable failure. He is not going to do anything of the sort.

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  Another illuminating point, which the plethora of media publications since the Chancellor's statement do not seem to have picked up on, was that the Chancellor mentioned that tax receipts last year were lower than expected. I was alarmed to hear that he is looking for more privatisation of public services and more private investment in public services. I think that the Government were the first to use the term "double whammy". That is a classic example of a double whammy because it can be guaranteed that the pursuit of those philosophies will mean that the public will have to pay more for services, not less.
  I was intrigued by the Chancellor's section on transport and I praise his nice attitude on the treatment of veteran vehicles. I think that they are veteran vehicles when they are over 25 years old, but they might be vintage. Certainly people treasure such vehicles. If people do not have a vehicle on the road, they should not have to pay tax.
  I was somewhat beguiled by the idea that one can somehow improve things by increasing the tax on fuel for road vehicles and the road fund tax—presumably to try to cut emissions, although the only way to do that is to reduce the number of miles that are run. At the same time, however, we are led to believe that there will be a considerable reduction in public expenditure on transport, especially public transport. Albeit on a small scale, there will be an increase in the cost of motoring. Many people have no choice but to use a vehicle—and they are not all well off—yet there is no credible alternative in the way of a well-integrated public transport system with proper investment. I found that strange. It is a short-term policy.
  I had the dubious pleasure this morning of listening to the Secretary of State for Social Security on Radio 4 after the 7 am news. For once, he sounded uncharacteristically unconvincing when speaking about the Government's policies on single parents. The reason that he sounded unconvincing might be to his credit because he was, after all, trying to defend the indefensible. We should take the attitude of the Secretary of State in conjunction with the proposals on housing benefit. We are talking about two of the most vulnerable sections of society, but where is the helping hand for them? They are not getting the helping hand; they are getting the reverse.
  Do the Government really believe, after years and years of under-investment in housing and the rise of private landlords brought about by their deregulation policies, that people on housing benefit are in a position to negotiate with their landlords to get a reduction in rent simply because the Government think that it is possible? Does anyone really believe that that is a credible proposition? My experience suggests the opposite.
  Recently, one of my constituents was being threatened by her landlord. If she was not to be out on the street, she had to give him £10 a week in addition to the housing benefit that he received directly. He would not give her a rent book or a receipt. That is the sort of behaviour that is bred by the Government's present housing policy. I will say a little more about that later.
  We are also led to believe that the reduction in tax on savings to 20p in the pound is a wonderful thing. What about investment income? We are told that the Chancellor wants to reward hard-working people, but I do not think that he rewards them by taxing what they earn at a higher rate than he taxes investment income. A millionaire who
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  has invested £1 million can get away with paying tax at 20p in the pound, yet people on relatively moderate incomes must pay tax at a rate of 40p in the pound. That does not seem very satisfactory.
  The Chancellor said that he believes that the Government can afford a 1p reduction in tax. That is notwithstanding the fact that the education budget has been cut consistently for many years. The council in my constituency is so strapped for cash that it has had to cut many education services and it is dreading—as I am—tomorrow's statement. It has also closed welfare rights agencies because of chronic underfunding through the Revenue support grant. I hope that, tomorrow, my local council, Sunderland city council, will be allocated the same amount of money as Westminster city council. That would solve all of my problems.
  If the Chancellor can afford the 1p reduction in tax, which advantages those on high earnings disproportionately, why can he not afford to reduce value added tax on fuel? That would have given a helping hand to those in need, but there was nothing of that nature in the Budget.
  I welcome the fact that tax on beer is not to be increased. I am fairly neutral on the subject of duty on whisky, but I am intrigued about why the duty on strong cider must be increased. If the tax increase is based on alcoholic content, why are spirits and wine—which are stronger than cider—not taxed in the same manner? I am still trying to work it out; it does not seem very logical.
  On housing, I must declare an interest. I belong to the Durham Aged Mineworkers Homes Association, which comes under the auspices of the Charities Commission and is involved with the almshouse legislation. There will be 51,000 new social lettings this year, which is 9,000 fewer than the Government's lowest estimate. The cut from £1.5 billion to £1.1 billion will feed through into 18,000 fewer jobs next year—almost 10,000 fewer in the construction industry—and 30,000 fewer in the following year.
  That will have a drastic effect in the northern region, where next year the number of homes that housing associations can start will fall from 3,097—which was the figure first promised—to only 1,670. That is a reduction of almost 50 per cent. Yet the Chancellor says that he is trying to do something about the housing sector. The only thing that he has done is introduce the spectre of more private landlords—and anyone who has studied history dreads that.
  I believe that the Budget is based on economic failure. The hon. Member for Brighton, Kemptown (Sir A. Bowden) described it as a prudent Budget which was not quite what was expected. I agree that it is a prudent Budget in some respects, but it does not address any of the problems that I face in my constituency. It will not alter society for the better—indeed, I believe that it will have the opposite effect.
  Much has been said about the Labour party's position on the 1p reduction in income tax and whether we will vote against it. I do not pretend to speak for the party; I just try to speak honestly for myself. One has to be prudent, but I must admit that I shall find it very difficult to resist voting against the 1p decrease because I think that it is regressive and to be deplored.
  8.43 pm
  Mr. Matthew Carrington: At the outset, I declare my interests as they appear in the Register of Members' Interests—although I do not think that they will be very relevant to my speech tonight.
  It is a great pleasure to support a very cautious and prudent Budget. The last few Budgets were necessary, but I cannot say that they were altogether pleasant. It is never pleasant to be forced to raise taxes but, coming out of a recession, it was necessary. For a party that is always strongly committed to reducing the tax burden, it was an unfortunate necessity.
  The medicine has worked, however, and the economy is now doing extremely well. Our inflation rate is low—historically, it is at a very low level—and there are very few signs of inflationary pressures in the economy. Unemployment is decreasing, and it has been doing so consistently for a long time. Even the public sector borrowing requirement is decreasing fast—it decreased by £7 billion last year. The only problem is that it is not decreasing as fast as was projected originally and we are contemplating being one year behind the initial predictions.
  Nevertheless, growth in the economy has been good. Last year, at 4 per cent., economic growth was too good as such a level is unsustainable in our economy. This year, the growth rate has reduced to a very healthy 2.75 per cent. That is still well above the economy's trend rate, which is some 2.25 per cent. With a rise expected next year, I think that we can be content that economic growth is very strong and not leading to inflation.
  We are seeing signs of long-term, sustainable growth and that means that the supply side reforms for which the Government fought over 16 years are at last having an effect. All of that good news led my right hon. and learned Friend the Chancellor to produce a cautious Budget in which he did fundamentally very little. Although the economy is doing well, the recovery is still patchy.
  The outlook is favourable for exporters, but two sectors of the domestic market—the retail sector and the housing market—are not doing well. I believe that it is correct to put money back into the pockets of individuals who can then spend it as they wish. That boosts retail sales directly and the building and housing markets indirectly. Tax cuts are the most effective way of putting money back into people's pockets and, as such, are entirely justified. They are a very sensible way of helping two sectors of the economy that have been in serious trouble.
  However, I do not believe that tax cuts by themselves are enough. We now need substantial cuts in interest rates. Such cuts will not do very much for industry directly—after all, interest rates are at historically low levels and industrial investment decisions are unlikely to be influenced by further reductions in interest rates—but investment decisions are likely to be influenced by demand in the economy for the goods that industry can provide.
  I do not believe that interest rate cuts will assist the housing market. House prices are now very low and houses are extremely affordable in income terms. Interest rate cuts will put more money back into people's pockets. They will have the same effect as tax cuts to—increase demand and, in turn, increase investment in industry. They will also increase people's willingness to spend money on their houses.
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  I should like base rates to be cut by 0.5 per cent. before Christmas, followed by another 0.5 per cent. cut fairly soon after that. I believe that a 1 per cent. cut in interest rates is entirely sustainable and I do not believe that it would adversely affect our exchange rate—particularly as German interest rates are now on a downward trend.
  I must, however, mention one or two matters about which I am less happy. The first is the uniform business rate and its effect on London. My right hon. and learned Friend the Chancellor said in his Budget statement that, in parts of the country where rateable values are increasing, the uniform business rate is to be phased in more slowly than originally intended. In London, we suffer from the reverse problem. When the uniform business rate was introduced in 1988, property prices were extremely high. The revaluation that followed was done when property prices in London had come off the peak, and many businesses found that the notional reduction in their uniform business rate was phased in very slowly.
  There should be a better balance between the phasing in of increases in parts of the country that are suffering them and the phasing in of decreases in London. Business in London, especially retail business, is in very poor shape at the moment and would benefit enormously from a reduction in rates.
  My final argument is more technical. The Budget will lead inevitably to a very complex Finance Bill. There are technical changes in the tax structure that will be hard to put into a short and easily understood Finance Bill. As a veteran of many Finance Bills, and having sat on many Finance Bill Committees, I know the problems that confront the Committee when it has to examine highly technical clauses. There is neither the time to examine them in the detail needed nor, occasionally, the expertise in the Committee necessary to give them the scrutiny they deserve.
  That problem should be tackled and there are several ways in which it might be done. The most obvious way, as several of us have suggested for some time, is to separate the technical taxes management aspects from the tax changes and put them into a separate Bill, which might be examined by a Committee that had the time to examine them thoroughly.
  Alternatively, expert evidence might be taken on the highly technical clauses. That might be done by a Standing Committee with a dispensation of the House, or the Bill might be passed initially to the Treasury and Civil Service Select Committee to pre-vet those clauses, take evidence if required and produce a report for the Finance Bill Committee to consider.
  One thing is certain. The technical clauses in the Finance Bill do not receive the scrutiny that they deserve. We end up returning to them year after year to change what we have passed in the previous years, which is highly unsatisfactory.
  The Budget has done what is needed in the economy. I believe that it gives us that wonderful goal that we have searched for for years—sustainable, low-inflation growth. I hope, therefore, that it will lead to greater things in the Budget next year.
  8.52 pm
  Mr. Denis MacShane: I joined the Labour party about a quarter of a century ago, and I

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  remember that the first great disappointment of my youthful membership was the introduction of a Budget by one Roy Jenkins, now a Member of another House, which led straight to Labour's defeat in 1970.
  From a political point of view, the Budget presented yesterday by the Chancellor smacks very much of the same Treasury orthodoxy—cautious, candle-ends, steady-as-she-goes manipulation of the nation's finances, which, although the orthodox economists at the Treasury may smile about the fact that they have mastered their man, may lead to considerable political dismay in the Conservative party. We were aware of that yesterday, when the only cheer or smile came when the Chancellor announced that he would lift the vehicle tax on Bentleys and Bugattis. For the rest, it was a poor and dull reception indeed.
  As we are discussing Mr. Jenkins and one of his successors, the right hon. and learned Member for Rushcliffe (Mr. Clarke), let me turn to another Conservative philosopher, who once said:
  "The whole business of the poor is to administer to the idleness, folly and luxury of the rich, and that of the rich, in return, is to find the best methods of increasing the burdens of the poor."
  The Paymaster General, a learned graduate of Oxford university—I wish to apologise to him and to my hon. Friend the Member for Edinburgh, Central (Mr. Darling) for the fact that I must leave before the winding-up speeches—will recognise that quotation from Edmund Burke. Would that we had a Burke here today, to flay the creation of a two or even three-nation society, which the Budget will only exacerbate.
  Twenty-one new taxes have been imposed since 1992, every one bearing mainly on the poorer members of the community. We are told that the Chancellor's decisions since 1992, reinforced by the Budget, will help to steer the British economy on to a more stable course, yet we are 18th in the world gross domestic product per capita league, having slipped from 13th since 1979.
  Inflation here is higher than in the majority of European Union countries, including our main competitor partners. In its latest quarterly report, the Bank of England condemns the decrease in productivity improvements, especially the increase in unit wage costs, and we have the lowest investment witnessed for about 30 years.
  That bears down especially hard on my constituents, because I have to see the Budget refracted through the eyes of the people of Rotherham, and not many live in £200,000 houses there. Not many have handsome investment incomes from savings who will benefit from the tax cuts that the Chancellor has made. On the other hand, 12.5 per cent. of the working population are unemployed—12,000 people altogether. One in five people under the age of 25 in Rotherham are out of work, and are now under a new onslaught as the money is taken from them to put into the pockets of the rich.
  Is there any hope from the Budget for my constituents? It is a Budget that slashes a dagger at the arteries of investment, with £100 million taken away in grants to housing associations. That means that 35,000 fewer houses will be built this year as a result of those costs, and the construction workers and the small building firms of Rotherham will be left to face bankruptcy and despair.
  1290
  There are cuts of £190 million in the roads programme—another blow for domestic construction and the civil engineering programme.
  The business men of Rotherham and South Yorkshire wrote to the Chancellor last week. They begged him for any tax breaks in the Budget to be targeted at industry through increased capital allowances: no hope there. They welcome the private finance initiative, but find nothing in it for South Yorkshire, especially as those business men say that red tape defeats any efforts that they make to try to get the private finance initiative to work.
  There is something very strange in the Red Book—a massive discrepancy, not only in the public sector borrowing requirement, but in other sectors, between what we were told last year and what actually happened. The Chancellor collected £1.1 billion less than he forecast last year in income tax, £700 million less in corporation tax than predicted last year and £1.5 billion less in value added tax than he predicted last year. There is an odd contradiction between the mood music that we constantly hear at DTI and Treasury Question Time about the economy getting stronger—indeed, the Prime Minister said in Prime Minister's questions on Tuesday that incomes were rising—and the fact that we are collecting less and less tax.
  One reason may be the fact that tax avoidance remains one of the great growth industries in the British economy. As the hon. Member for Fulham (Mr. Carrington) suggested, tax legislation is the most complex legislation that the House passes. In fact, we have much the most complicated tax legislation in the world. Last year Rupert Murdoch made a profit of £960 million, but paid only £11 million in tax. What is the Chancellor's response to the fact that £15 billion to £17 billion has been lost in uncollected tax? His response is to fire 6,000 Inland Revenue employees who might be usefully employed gaining money for the state to help to balance the books.
  Then we move on to the nightmare of self-assessment. Here I address my remarks to Front-Bench spokesmen of my own party. I do not know how many hon. Members have examined the nine new complicated forms that taxpayers will be expected to fill in under the proposed new self-assessment scheme, which will cover some 9 million taxpayers, but even at the height of the Soviet bureaucracy, the Soviet citizen was never plagued with a requirement to fill in such complicated forms. The Budget does not address the question of what we mean by and want from taxation; it contains neither innovation nor inspiration.
  I welcomed the ideas presented by my hon. Friend the Member for Dunfermline, East (Mr. Brown), the shadow Chancellor, in the run-up to the Budget. He recommended a windfall tax—an appropriate suggestion, given the profits declared today by Yorkshire Water—and taking swathes of people at the bottom of the income scale out of the tax band with his 10p proposal. Here was the beginning of serious, innovative thought about our outdated tax regime. After all, the taxation of our people implies a fundamental relationship with Government.
  The Chief Secretary to the Treasury made much of his conservatism. He has been a Fellow of All Souls for many years; I must add that in recent months he has helped to turn his party into a lost cause. He will recall the words of his old mentor Disraeli, who said of conservatism:
  "It offers no redress for the present, and makes no preparation for the future."

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  For my constituents in Rotherham, who live in the "two nations" Britain that the Chancellor and the Chief Secretary have created—people who cry out for redress of present ills and investment in future growth—the only answer is a change of Government.
  9.1 pm
  Mr. Tim Smith: Notwithstanding what the hon. Member for Rotherham (Mr. MacShane) has said, I wish to defend the Inland Revenue's record on self-assessment. I believe that it will lead to simplification. It simply is not true to say that every taxpayer will have to fill in nine forms; the average taxpayer will have to fill in the main form and one schedule. I have just received the latest pack of self-assessment forms from the Inland Revenue. The Revenue has simplified the system considerably following consultation, and I think that it has done a pretty good job. In the long run taxpayers should save money, and we should be able to ensure that revenue is collected with fewer staff.
  Listening to the speech of the hon. Member for Dunfermline, East (Mr. Brown), I wondered whether he had actually read the Red Book. I suspect that he had not. He complained a great deal about the level of investment, but if he had looked at page 30 he would have seen that manufacturing investment is forecast to increase by more than 10 per cent. this year and in 1996.
  Similarly, I wonder whether the hon. Member for Rotherham took the trouble to read the Red Book. He, too, complained about the Government's record on investment. On the same page, the Red Book tells us that business investment is forecast to increase by 9 per cent. in 1996. I should have thought that that was a pretty good record.
  The hon. Member for Dunfermline, East also complained about the present state of the labour market. If he had turned to page 39 of the Red Book, he would have discovered that the employer survey measure of the labour market shows an increase of 510,000 jobs since the trough at the end of 1992. The labour force survey shows an even higher figure of 650,000 over the same period. That is a pretty good record. It contrasts sharply with what happened during the recovery after the last recession, when employment did not stop falling for about four years following the trough of the recession. It illustrates the current flexibility in the labour market, which now responds much more quickly to changes in demand.
  I do not know whether you saw the hon. Member for Oxford, East (Mr. Smith) on "Newsnight" last night, Madam Deputy Speaker. Jeremy Paxman rightly pressed him on why the Opposition refuse to make up their mind about whether they are in favour of reducing the standard rate of income tax by 1p in the pound. Labour Members are going to abstain: they are neither for nor against the proposal. I was interested to observe that the hon. Member for Sunderland, North (Mr. Etherington) clearly feels pretty uncomfortable about that. His feeling is understandable. The position of the Liberal Democrats is at least honest and straightforward: they will vote against it. What do Opposition Front Benchers think about it? Are they for or against it? How can they possibly abstain? It was no surprise to me that the hon. Member for Oxford, East looked so uncomfortable on the television last night.
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  This is a responsible, prudent and sensible Budget. I particularly welcome the fact that public spending as a proportion of gross domestic product will soon fall below 40 per cent. There is always an interesting table in the Red Book. This year, it appears on page 139, and it shows the record of public spending over the past 30 years. It shows that, in the recession of the middle 1970s, public spending peaked at about 47 per cent. of GDP. In the recession of the early 1980s, it peaked at around 45 per cent. and in the most recent recession it peaked at around 43 per cent. We have been moving in the right direction over the past 20 years, but we should aim, once we have it below 40 per cent. of GDP, to keep it there.
  The Governor of Hong Kong, Chris Patten, was quite right—he has learnt a little from his time in the far east—to say that there is a correlation between the proportion of public spending as a proportion of national income and economic growth rates. Countries in the far east spend a lower proportion of their GDP and have higher growth rates. That is a good target. We are making good progress towards achieving it and we should stick with it.
  What has led to a higher public sector borrowing requirement for the current year and for next year is not the Government's failure to control public spending, which has been kept under effective control, but rather, as the hon. Member for Rotherham said, that revenues have not come in at the anticipated level. In particular, VAT revenues are down by about £4 billion from the amount forecast, and next year's VAT forecast is lower than that for this year. That may be because of a lower level of consumer spending than was forecast. It is hard to know precisely what has contributed to that. It may not be so much VAT as the duties on alcohol and spirits, because a great deal of alcohol is now imported from France. That may have something to do with it, but revenues are down, and that is the explanation.
  It is important that we ensure that public sector borrowing continues on a downward path, which is precisely what my right hon. and learned Friend the Chancellor proposes. It will soon be below the Maastricht level of 3 per cent. Significantly, I noticed that my right hon. Friend the Chief Secretary referred in his speech to capital expenditure, which is running at around £22.5 billion. That is quite a useful yardstick, too. The Government should not borrow more than the amount of capital spending in any particular year. It looks as though the two will coincide next year.
  The Budget has also been criticised for not doing anything about investment. The Opposition came up with the tried but failed formula of increasing capital allowances. That did not work last time and it will not work if they ever have the chance to do that again, because it distorts capital spending decisions. What matters much more for investment is a stable economic climate, which is precisely what we have—low interest rates and low inflation.
  The PFI has been criticised on the ground that there arc not enough schemes to illustrate precisely what can he achieved. I should like to mention two, both of which will benefit my constituency. The first is a massive extension to Wycombe General hospital, which will cost £32 million. The project was proposed by South Buckinghamshire NHS trust and is financed by the Royal Bank of Scotland. I understand that the developer will he Taylor Woodrow. That is a hard and fast example of a project that will benefit NHS patients in my constituency.

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  Another good example is the widening of the M40 from three to four lanes between Denham and High Wycombe. It is going ahead under a design, build, finance and operate contract. I hope very much that it will start in the middle of next year. It probably could not have been achieved without the PFI. Those two schemes will go ahead in the next 12 months.
  Like my hon. Friends, I welcome the fact that education spending is to be increased. The key is to ensure that the £878 million that my right hon. Friend the Secretary of State for Education and Employment announced finds its way to the schools. I know that it is difficult to ring-fence this money, but we need some examples of how much each school would benefit if its budget were to be increased by 4.5 per cent.
  I welcome the fact that the police are to get extra resources, and I understand that an announcement will be made tomorrow. I hope that Thames Valley police will get their share of the additional resources.
  My right hon. and learned Friend the Chancellor made a welcome announcement about simpler legislation for Inland Revenue taxes. I echo what my hon. Friend the Member for Fulham (Mr. Carrington) said. It will provide the Procedure Committee with an opportunity to consider how we will deal with the additional legislation. My right hon. and learned Friend has proposed that all Inland Revenue taxes should be rewritten over a five-year period. I think that we should reconsider the idea of dividing up Finance Bills between the main taxation elements and the more technical elements.
  The Budget is prudent and sensible and it will benefit consumers, taxpayers and the British economy alike.
  9.11 pm
  Mr. Robert Ainsworth: The hon. Member for Beaconsfield (Mr. Smith) talked about the 500,000 jobs that have been created since the trough of the recession. He compared that with the last recession. Whose recession was that? That was also the Tory party's recession. If one picks the starting date and the finishing date carefully for statistics, one can prove almost anything.
  Not long after the Government took office they created a solid bottom level of unemployment of at least 2 million people out of work. There is now a wasted generation. The real tragedy is youth unemployment and the Budget does absolutely nothing to deal with that problem. Nationally, 650,000 people under the age of 25 are out of work. In the west midlands region alone, 66,000 people are out of work, and in the metropolitan area the number is over 24,000. In some inner-city estates, it is unusual for a young male to have a job. That has been the case for over 10 years since the first Tory recession that the hon. Member for Beaconsfield mentioned. In my opinion, the Budget did very little that will affect that situation.
  The Chancellor usually gives the Budget a name, such as the Budget for jobs, the Budget for Britain and the Budget for investment. He did not seem to give a name to the Budget this time. We thought he might call it the Budget for the Tory party's survival, but according to the reaction of Tory Back Benchers it was not that. It must be the no-name Budget. If the right hon. and learned
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  Gentleman will not give it a name himself, we will. The Queen's Speech was the "smoking out the Opposition Queen's Speech" and the best we can do for the Budget is probably The Sun offering of the "cold kipper" Budget.
  The Chancellor is trying to say that it is a prudent Budget, but is it? He has slashed some capital spending, and that is hardly prudent because it only builds up problems for the future.
  Mr. Kenneth Clarke: For information, we toyed with the idea of calling it a Budget for lasting prosperity, but the Opposition have given soundbites a bad name so I decided to drop the tradition.
  Mr. Ainsworth: The Chancellor would not have got away with "the Budget for lasting prosperity". The headlines would have called him into even more ridicule had he tried to hang that title on his offering.
  The Chancellor slashed capital spending. That is irresponsible because it puts off problems until tomorrow. That is exactly what the Government are doing. They plan to cut capital spending on the NHS by 26.5 per cent. over the next five years.
  Over time, the party of prudence has incurred a huge increase in debt. Government spokesmen have compared the debts of some Labour-run cities with those of third-world countries and derided them by saying that Birmingham or Coventry, for example, owe more than such and such a place. But the Red Book shows that this country pays £22 billion a year in debt interest, which is more than we spend on defence or law and order and three times what we spend on transport. It is incredible that the Conservative party tries to pretend that it is a party of prudence when it has inflicted pain on people while running up such debts. It is clearly not the party of prudence, as the Chancellor would have us believe.
  The increase in petrol prices coupled with the increase in vehicle excise duty are the two measures in the Budget that are causing the most anger in the country. I understand the need to discourage the excessive use of cars, but if petrol prices and vehicle excise duty are to be increased well above the rate of inflation, poor motorists will be punished. The Government have decided to settle traffic and tax problems by driving poor motorists off the road. That simply cannot justified. We should try, over time, to move the burden of taxation from excise duty on to petrol duty so that people pay tax for using their cars, not for having access to a car. In some rural and inner-city areas, people want a car to make themselves economically viable and get themselves into the job market, yet the costs of insurance and vehicle excise duty do not allow them to become car owners.
  Conservative Members hold up our car industry as an example of some kind of revival, but all that we have had is inward investment. Nowadays, our car industry, apart from small companies, is completely and absolutely owned by foreign companies. We should not boast about that. I do not knock inward investment as our country needs it badly for the jobs that it brings. But the United Kingdom, Spain and Portugal have had the inward investment in the car industry. Is that the league that we want to put our country into? We boast about inward investment by Samsung in another industry, but the two countries that Samsung has invested in are the United Kingdom and Slovakia. Is that the league that we want to be in?

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  I agree that we need investment from wherever it comes but, as Conservative Members know, the problem that we have had for a long time is that our indigenous companies have not invested at the rate that they should. To see how that problem developed, we must look at the decline that has taken place throughout this Government's term, back through the previous Labour Government's term to the 1960s. People think that it is a natural decline and that the number of jobs provided by the car industry will inevitably fall. Jaguar, which is in my constituency, is a relative success but, over a period, it has failed to increase the number of jobs that it provides. In 1959, it employed about 5,000 people; it now employs 6,500. Over the same period, BMW has grown from 6,000 employees to 75,000 and it has now bought out the Rover group with another 30,000 employees.
  A couple of years ago, Conservative Members derided the German economy and its way of doing business. They said that we would overtake Germany and become the leading economy in Europe, and that we could not have social contracts and works councils because they would ruin the economy. However, those are exactly what have applied in Germany over that 30-year period. That is exactly what applied in BMW over those 30 years. The BMW works council played a significant role in the development of job opportunities and job creation over a long period, and the result has been a tenfold growth in the number of jobs.
  We ought to see some investment and some work that helps the car industry, but as in so many other areas what we get is pretence. A short time ago the Department of Trade and Industry issued a press release about the work that is being done along with the Society of Motor Manufacturers and Traders in trying to assist the small businesses that form the supply sector of the car industry. Everybody knows that the growth in jobs will be in that sector and not in the front-line companies and that there will be a need for quality research.
  When we look behind the boast about the work that is being done with the SMMT, we see that about 200 companies will be involved and that 12 experts in quality have been taken to Japan for quality training so that they can help those 200 supplier companies. There are 4,000 supplier companies in the car industry and the problem is that our suppliers need a huge improvement in quality to compete on the world market. We are playing games and pretending to deal with those problems.
  The country needs a Government who are actively involved in tackling these problems and not a Government who are happy to see a constant 2 million people unemployed—
  Madam Deputy Speaker (Dame Janet Fookes): Order. [Interruption.] I am sorry, but the 10-minute rule is strictly enforced.
  9.21 pm
  Mr. Nick Hawkins: Unlike the hon. Member for Coventry, North-East (Mr. Ainsworth) I entirely welcome the Budget. The problem with hon. Members such as him is that they often attempt to rewrite history. The hon. Gentleman spoke about problems in the car industry in the west midlands and about the growth of BMW, and he compared the number of employees. But he entirely forgot to mention all the trade union militancy
  1296
  that was supported by so many Opposition Members when I lived and worked in the west midlands throughout the bad old days of the last Labour Government. Opposition Members should remember that it was trade union militancy and Labour apologists when that party was in government who completely wrecked the British car industry.
  I want to speak about the reaction of ordinary people to my right hon. and learned Friend the Chancellor's excellent Budget, and I shall start by quoting a clothing and footwear assistant who told the Financial Times that the Chancellor had listened to the small people and thought that it was brilliant news. Those who are responsible for creating jobs in Britain are the people in the CBI. Its director general welcomed the fact that the Government had broadly stuck to the prudent economic line that the CBI recommended. He said the CBI was pleased that the Chancellor appeared to have limited tax cuts to reductions in spending and that he had resisted the temptation to go for excessive tax cuts. That is the kind of welcome that I like to hear.
  On BBC 2 a Mr. Len Stone said:
  "My job will be secure. The Budget is good for industry, steady growth and people will buy more vans, especially the contract fleet."
  The Financial Times stated that the financial markets had to be convinced that the needed combination of tough spending control and economic growth would be delivered, provided that the Chancellor convinced them that he would be able to cut interest rates. I hope that the Financial Times is right about that because that too will help my constituents.
  I am particularly pleased that my right hon. and learned Friend listened to submissions by me and by many of my hon. Friends about help for the elderly and especially for those who require now, or may require, long-term care. My constituency has the highest proportion of pensioners of any constituency and I was particularly pleased not only at the measures in the Budget but at the way in which they have been received. In particular, Sally Greengross, director general of Age Concern, is quoted in The Daily Telegraph as saying:
  "Older people who are worried about paying for care will be delighted".
  Jill Pitkeathley of the Carers National Association said:
  "We are delighted that this will relieve the worries of many families".
  It is rare that I quote with approval anything said by a general secretary-elect of Unison, but even Mr. Rodney Bickerstaffe was heard to say on BBC Radio 4:
  "Anything that's going to help the elderly is going to be useful. It's a step in the right direction. So far as the poorest earners are concerned, there is something for them".
  Even if Opposition Members do not recognise it, the country recognises that the Budget has been prudent, sensible and helpful.
  I was especially pleased that my right hon. and learned Friend dealt with the difficulty that existed in relation to employee share ownership schemes. As one who, for a long time before coming to the House, supported employee share ownership, the sharing of companies' successes and the involvement of employees in those successes, I was delighted that Gill Nott, chief executive of Proshare, said about my right hon. and learned Friend's measures:
  "This is the best Budget for employee share ownership that we have seen in many years".

  1297
  On public opinion, a Mr. Steve Spurling, a bank employee from Crawley, was quoted on BBC Radio 4 as saying about the Budget:
  "I'm personally pleased with the overall package introduced covering a range of areas. It means to me about £20 a month which is a tangible sum, something I can actually get my hands on".
  I am especially concerned to ensure that there should be further help for the construction industry and I declare my interest as a consultant to the Building Employers Confederation. In that regard, there has been a broad welcome to the expansion of the private finance initiative. Sir John Banham, chairman of Tarmac, is quoted in the Independent as saying:
  "The Chancellor is on the right track and the measures he has put in place provide the best prospects for the UK building industry".
  In relation to the housing market, the chief executive of the Royal Institute of Chartered Surveyors is quoted in the Independent as saying:
  "On the housing market, we are pleased that there has been no attempt at a quick fix. We have argued for some time that special help for housing will not work because the problem is not one of affordability but of confidence".
  I agree with that and I am sure that my right hon. and learned Friend's Budget measures will bring back that confidence.
  The chairman of Siebe, Mr. Barrie Stephens, is quoted in the Financial Times as saying:
  "I am very enthusiastic. The Government has looked at the economy dispassionately and sensibly and showed that they are good managers. It is a prudent and balanced Budget."
  I especially welcome the fact that three steps have been taken towards a 20p basic rate in income tax, which helps both the lower-paid and savers. It is crucial that the Government's economic strategy should benefit the thrifty, especially thrifty pensioners. Income tax cuts that my right hon. and learned Friend has introduced will benefit 26 million people. Now one quarter of all taxpayers pay tax at only 20p.
  I am delighted that my right hon. and learned Friend has cracked down on fraud and waste, and that he has helped to provide more provision for schools, for law and order and for health, the same three priorities that I and many of my right hon. and hon. Friends had urged on him.
  By contrast, Labour's sums do not add up. The hon. Member for Dunfermline, East (Mr. Brown) had five questions from myself and other hon. Members. He failed to answer a single one in his speech. He cannot answer them because his sums do not add up. Labour cannot oppose the 24p basic rate because it knows that that rate is popular. Its policies are as bankrupt as it would seek to make the country if it were ever unfortunate enough to be in power.
  I welcome the fact that my right hon. and learned Friend has not sought to hit the UK insurance industry. We wish to encourage more people to have proper insurance cover. He has rightly recognised the strength and importance of the UK insurance industry and not increased insurance premium tax. The problem with Opposition Front-Bench Members is that they all have backgrounds not in business but in lecturing and legal work. They do not understand the needs of the British
  1298
  people or the British economy. Only my right hon. and learned Friend and his right hon. and hon. Friends have that ability and I strongly support his Budget.
  9.29 pm
  Mr. Alistair Darling: I thought that the Chancellor had a legal background, as indeed do I. I was interested in what the hon. Member for Blackpool, South (Mr. Hawkins) said in praise of the Budget. If he is so confident about the Government's position, one wonders why he is, as I understand, on the lookout for a safer seat, and is joining many of his colleagues on the chicken run. Clearly he does not believe that the Chancellor or the Government have done enough to make it likely that the people of Blackpool, South will return him to the House at the next election.
  It was the Conservatives, not us, who said that the Budget was designed to kick-start their political recovery. But the muted cheer when the Chancellor sat down, and the look of despair on the faces of Conservative Members, told us the real story. They knew that if that was the objective of the Budget, it had failed.
  I was interested to read in the Independent on Saturday something attributed to the hon. Member for Bridlington (Mr. Townend). I am sorry that the hon. Gentleman is not in his place now, but I expect that he will return. Talking about the amount of money that the Chancellor should give away, he was quoted as saying:
  "At £10 billion I think that we would win the next election, at about £6 billion we could be in with a chance, but if it is only £2 billion or £3 billion we can forget it."
  Right on cue, the hon. Member for Bridlington has walked back into the Chamber.
  It is obvious what has happened today. Conservative Members have had to change their tune. They were led to believe that there would be huge tax hand-outs yesterday, so today they have had to make different speeches, in praise of alleged prudence on the part of the Chancellor.
  The Chancellor has not revived the Conservatives' fortunes, because he cannot. In particular, he has failed to revive the country's long-term economic prospects. I was amused, as I suspect others were, when the right hon. and learned Gentleman said that he had half thought of entitling his Budget, "A Budget for lasting prosperity"—but of course, we have all come to admire his sense of humour.
  After 17 relaunches, the Tory party is still searching for a solution, and the Budget, like the Queen's Speech, has proved something of a damp squib. As my hon. Friend the Member for Coventry, North-East (Mr. Ainsworth) said, the Queen's Speech was supposed to smoke us out, but instead people saw the bankruptcy of the Conservative party's policies and position.
  The Budget is no different. It was supposed to be designed for political purposes and to breathe life into the Conservative party, but it failed to do so. As my hon. Friend the Member for Dunfermline, East (Mr. Brown) said, the Conservatives are prisoners of their own political and economic failure. After 16 years they are running out of ideas and have no sense of direction.
  The flagship of the Budget was supposed to be a dramatic cut in income tax, but when it came it was just one penny. The best that the Chief Secretary to the Treasury could say was that it was "plausible". That is

  1299
  not much in the way of praise. Indeed, the right hon. Gentleman's contribution was notable for the fact that he said little about the Budget, contenting himself with making several allegations about our position, which he then had to withdraw.
  There we have it—a cut of only one penny, after everything that the Government have said. Seven pence up since 1992, one penny down in 1995. And that comes from a Government who have given us 21 different tax rises since 1992. I notice that over the past three years there has been no word about the money that was taken away in tax belonging to the taxpayers. Today, apparently, only the one penny belongs to the taxpayers, not the six pence that has also been taken from them since 1992.
  At the general election the Government promised to reduce taxes year on year. And they promised a recovery that would start the day after the election. No wonder people do not trust the Government, or believe a word that they say. Even after the Budget an average family is about £670 worse off than it was at the last election. What the Government give with one hand they take away with the other, and people know that. They know income tax is down by one penny, and they will welcome that partial relief, but they also know about the increased charges, the increased rail fares caused by the privatisation of British Rail and, as my hon. Friend the Member for Coventry, South-East (Mr. Cunningham) said, increased council tax.
  Mr. John Townend: The hon. Gentleman talks about an increase in taxes "equivalent" to 7p in the pound, then compares it with a reduction in the standard rate of 1p in the pound. To be consistent, if he is talking about equivalent tax reductions he should compare them with equivalent tax increases. The figures are not 7p and 1p, but 7p and 2½p.
  Mr. Darling: I am surprised at the hon. Gentleman. I thought that he was going to help clarify what he was reported as saying in the Independent on Saturday. I will not repeat it, because he obviously knows what he said to Colin Brown, the paper's chief political correspondent.
  Before the Budget, and indeed in the House on many occasions, the hon. Member for Bridlington has made the point that he has felt let down by the Government putting up taxes. The 7p figure did not originate with us. We do not claim authorship of it. It came from the Chancellor of the Exchequer himself. The public know that since the election taxes have risen by the equivalent of 7p in the pound, so the Conservatives cannot really expect gratitude for giving back 1p in the pound in the meantime. [Interruption.]
  I want to reply to the many points that were made in the short time available. One point, in respect of—[Interruption.]
  Madam Deputy Speaker: Order. There are too many seated interventions.
  Mr. Tim Smith rose—
  Mr. Darling: I think that the hon. Gentleman was one of those shouting from a sedentary position. I may give way to him later if I have time, but not at the moment.
  1300
  I want to deal with a point made by the right hon. Member for South Norfolk (Mr. MacGregor). He was good enough to write to me to say that he could not stay for the entire debate. No doubt he will read what is said. He made the point, as have other Conservative Members, that a number of my Back-Bench colleagues have said things that might be interpreted as a call for further expenditure. He did that having just asked for further expenditure on the roads programme in East Anglia.
  The right hon. Member for South Norfolk made that statement quite properly as the Member for an East Anglian constituency. Government Members and the chairman of the Conservative party should think long and hard about the implications of what they are doing. Are they saying that Back-Bench constituency Members cannot make constituency points in support of their constituents' position, advocating certain courses of action, such as the hon. Member for Brighton, Kemptown (Sir A. Bowden), who said that he wanted to do something with VAT on energy efficiency, like the hon. Member for Bridlington, who suggested an increase in VAT—
  Mr. Townend indicated dissent.
  Mr. Darling: Yes he did; earlier this evening he suggested an increase of 1 per cent.
  Such points are legitimately made by Back-Bench Members of Parliament and it really is disingenuous for the Conservative party to interpret them as being the position that a party might take at a general election, any more than Labour Members would be correct to say that just because one Tory Back-Bencher said something, whether on the Clive Anderson show or in this place, somehow the whole weight of the party is thrown behind it. The right hon. Member for South Norfolk, who is an intelligent man, might want to reflect on the implications of what he said.
  Sir Andrew Bowden: Will the hon. Gentleman give way?
  Mr. Darling: Yes, but it will have to be the last intervention because I do not want to spoil the Minister's winding-up speech.
  Sir Andrew Bowden: Does the hon. Gentleman agree that there is a difference between an individual Back Bencher presenting a case that might have a constituency connotation or a special interest, and an impression given by an Opposition Front-Bench spokesman—without saying so but implying it quite clearly so that the public assume it—that if his party wins, it will spend more money in a particular area?
  Mr. Darling: The right hon. Member for Peterborough (Dr. Mawhinney), the Conservative party chairman, has been attributing commitments to the Labour party by listening to Back Benchers. I am sure that the Government would not claim that what the hon. Gentleman said this evening, or indeed what the right hon. Member for South Norfolk said, was Government policy. Unless we expect Members of Parliament no longer to advocate the interests of their constituents in this place—where after all they ought to do it—we should think long and hard about the consequences of the comments of the right hon. Member for South Norfolk.

  1301
  As my hon. Friends have said, the Government's Budget was no surprise. The Chancellor's room for manoeuvre was restricted. Public borrowing is higher than forecast—this year it is £29 billion and forecast to move upwards in the next three years. There is slower growth and the Chancellor tells us that he thinks that there will be growth of some 3 per cent. in future. No wonder he is straining credibility.
  Of course a great deal is perilled on this high growth. If next year the Chancellor is going to be able to mount a giveaway Budget—there will be pressure from Conservative Members on him to do so—that promised growth will have to be delivered. However, the record does not suggest that he is likely to be successful. The Chancellor wants us to believe that next year will somehow be different from past years. We have had higher inflation than the Chancellor predicted and the current account deficit is worse this year than he predicted.
  Investment—the future for long-term sustainable economic growth—has of course been cut. There are some things that we do welcome, such as the move to simplify tax, but we think that the Government should do more to prevent tax evasion and to close tax loopholes.
  I welcome the Chancellor's move to clarify and improve the position with regard to share ownership. We believe that employees should be encouraged to have a stake in their firm and that such a stake should be open to everyone from the boardroom to the shop floor. However, shares and options should be given as a reward for success. They should not be granted in anticipation of success that may never come, and they should encourage saving.
  We shall have to see what provisions there are in the Finance Bill, but it would be wrong for us not to welcome the fact that the Government have moved in a direction that we have advocated for much of the last 12 months. I am only sorry that the Government have done nothing about the abuses that are happening in the boardrooms of the privatised utilities.
  We welcome the promotion of saving and what the Chancellor had to say on that. I listened to the Chancellor yesterday and I thought that I was listening to my hon. Friend the Member for Dunfermline, East, who made exactly the same point some weeks ago. We wish to build on the PEPs experience and to create specific instruments that will encourage people to save in the medium and the long term.
  We welcome what the Chancellor has done with regard to the excise duty on Scotch whisky. It is, however, to investment and the private finance initiative that I want to return since the Government have set so much store by it. The fact is that the PFI has never taken off. We have always supported the principle of the PFI. The deputy leader of the Labour party, my right hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott), was the first to float that idea before the last general election. He was denounced at the time, and then the Government promptly accepted much of what he had said.
  1302
  There are two problems with the PFI. First, it has been strangled by bureaucracy and by red tape. Every capital project has been channelled through the system, which has clogged it up. Secondly, the Government have never set a list of priorities. In 1992, the Government published a list that included 78 projects, ranging from the west coast main line upgrading to the car park at Eastbourne hospital. The private sector had no idea where the Government's priorities lay.
  Two things are striking about the Government press release that was issued yesterday. First, the Government have accepted that there must be some degree of prioritisation and said that they will publish an illustrative list. In fact, 1,400 projects have appeared today with an A or a B against them. The Government have to do more to indicate their priorities as between projects that have a major strategic interest and those that have a lesser interest in relation to a national strategy. The private sector has told us and anyone who is prepared to listen that the great difficulty is that it has no idea which projects the Government are likely to favour and which they are not.
  The Government's attachment to right-wing dogma has meant that they have privatised the decision-making process. It is for the Government to give a lead and then invite the private sector to contribute. If they did that, there would be a better chance of seeing more projects get off the ground and under way. Once we saw some projects get off the ground, more would follow.
  The second interesting thing about the Government's press release yesterday is that they promised a further £14 billion of investment by 1998–99. Of course, that includes the £5 billion promised last year. Little of that £5 billion has found its way into agreed projects which have started. We are entitled to take with a degree of scepticism the Government's commitment that the PFI can take the place of public investment. It is planned that Government investment in the public sector will fall by almost 18 per cent. between this year and 1999. That is on top of a cut of 7.2 per cent. in real terms in the past three years.
  Government direct investment in the national health service will be cut in real terms by 27 per cent. in three years. Given the lack of progress in the PFI, people are entitled to ask how the Government expect it to take the place of public investment. When the PFI was originally launched, it was suggested that it would represent additional investment. The clear lesson of what has happened in the past few years is that the PFI is not additional investment but a substitute for public sector investment. It is not even that, because little of it is getting off the ground. If the Government prioritised the projects that they would like to see get off the ground and broke down some of the bureaucracy and red tape that is created, some real progress would be made.
  Indeed, anyone wanting a clue as to what is going wrong need look no further than a press release put out by the Secretary of State for Education and Employment which said that "too few people" knew how to exploit the initiative to its full advantage. That was why, the release continued, the right hon. Lady's Department had "established a hotline" on the matter. So, the people

  1303
  who brought you the coneline now bring you a new hotline to try to get the project off the ground. The Government really need to do more.
  The projects are a matter of choice. In health, the Government are spending £1 billion a year on bureaucrats, and not on front-line care. Why does a hospital need a press officer? In education, the Government have chosen to double the assisted places scheme instead of using the money to cap class sizes below 30.
  The hon. Member for Gordon (Mr. Bruce) is not in his place, but it would be wrong of me not to reply to his point about his party's position on the Government's reduction in income tax and how that relates to education. I take with a great big pinch of salt what the Liberal Democrats have to say on this, as in all other matters. They are the people who said that the top tax rate should be 60p, and then said a week later that it should be 50p. They said that a penny should be put on tax for education, but then said that they would consult about it. They later said that they would make that tax increase if it was necessary.
  When he was challenged today, the hon. Member for Gordon did not know what his party would do at the next election. I would say to my hon. Friend the Member for Sunderland, North (Mr. Etherington)—who also raised the matter—that even if the Liberal Democrats' position were carried, there is no chance that one penny of that money would find its way back into the education Budget. That option does not lie with the Opposition, only with the Government. We believe that it is quite wrong to impose further taxation on people who are already paying more than ever before by way of tax. The people who would benefit from the education system are suffering now.
  The Government's position simply does not add up. They have done nothing about tackling long-term unemployment. In one in five non-pensioner households, there is no work whatsoever, and the Government are doing nothing about that. We have made a firm proposal to implement a windfall tax, which we believe would have a major impact on getting people back to work. The Government's proposals make no economic sense and no social sense. The Budget deserves to be rejected for that reason, and for every other reason advanced tonight.
  9.46 pm
  The Paymaster General (Mr. David Heathcoat-Amory): In his speech yesterday, my right hon. and learned Friend the Chancellor set out a Budget for this country's earners and savers, and a Budget that will spend more money on priority services while cutting the cost of government. It is quite clear from today's debate that that is strongly supported by my hon. Friends. It is clear too that the Opposition are in a muddle.
  The Opposition are anxious to pose as the taxpayer's friend, and they have announced that they will not oppose the tax cuts—that was the one question answered by the hon. Member for Dunfermline, East (Mr. Brown)—but they will not support them either. They will abstain—at least, most of them will do so. The hon. Member for Sunderland, North (Mr. Etherington), who is in his place, hinted that he would
  1304
  vote against the tax cuts. Old Labour has some principles left, but new Labour will heroically abstain on the central issues of the Budget. Very new Labour may come round to support the tax cuts; the lurch to the right in the Labour party is not over yet.
  The confusion and muddle on the Opposition Benches has a simple cause. When a party such as Labour abandons all its traditions, dumps its baggage and disowns its past beliefs and becomes motivated solely by the desire for office, nothing keeps it together. That is why the Opposition's response to the Budget has been so shallow and opportunistic, and why the shadow Chancellor seemed genuinely incapable of answering simple points put to him by my hon. Friends. What was his inflation target? He did not have one. What was the cost of his 10p lower rate tax proposals? He did not know. Would he support our 20p savings rate? He would not say. Would he abolish the insurance premium tax, which he has opposed? He had no idea. Yet Labour claims to be the party of government in waiting.
  The contrast between that policy vacuum and the Budget laid out by my right hon. and learned Friend the Chancellor of the Exchequer could not be clearer. We have balanced our tax-cutting proposals with similar cuts in public expenditure, while preserving areas such as health and education.
  I agree with my hon. Friend the Member for Brighton, Kemptown (Sir A. Bowden) that the extra money for education must go through to the classroom. He clearly has a similar local education authority to mine and that of my right hon. Friend the Member for Bridgwater (Mr. King)—too much of the money sticks to the local authority and never gets to the classroom.
  We have increased priority expenditure by a further drive on waste and on fraud in social security expenditure and by delivering year-on-year cuts in the expenditure of Whitehall Departments. That has been driven through by my right hon. Friend the Chief Secretary to the Treasury and I am pleased that the policy had the strong support of my hon. Friend the Member for Bridlington (Mr. Townend) and others.
  The civil service is now more than 30 per cent. smaller than it was in 1979. In the next three years, the cost will fall by a further £2 billion in real terms. As the Government are the largest service industry in the country, it is right on economic grounds alone that they should also be the most efficient. The relentless drive for efficiency over that part of the economy that the Government control is without doubt one reason why the performance of the British economy generally has been so much better in recent years than in the 1970s.
  Even employment, which cropped up again and again in the debate, is showing signs of a successful recovery. Unemployment is lower than in Germany, France or Italy, and we have the highest proportion of people in work of any major European economy. Of course, there are regional variations and I listened carefully to what my hon. Friend the Member for South-East Cornwall (Mr. Hicks) said, even though the bulk of his remarks about the distribution of the funding formula were perhaps more accurately directed at my right hon.

  1305
  Friend the Secretary of State for the Environment. He will be listening and has already listened to representations from the west country and other regions.
  There were persistent calls for more Government investment—an echo that we heard in the past from the Opposition. They still believe that unemployment can be solved and investment increased simply by spending more Government money. If they should have learnt anything from the sad experiences of the 1970s, it is that a thriving economy is created not by the Government but by a successful private sector.
  I shall take one example—the small companies rate of corporation tax was 42p in the pound when Labour left office in 1979, but we have reduced it to 24p in the pound. We have nearly halved the tax rate on those successful companies. That does far more for growth, investment and employment than any of the spending schemes dreamt up on the Opposition Benches.
  The hon. Member for Coventry, South-East (Mr. Cunningham) asked what the Government had done for industry, but I say that industry and business generally now have a choice. They will get something from Labour and, indeed, from the Liberal Democrats—the social chapter of the treaty of Rome. The Leader of the Opposition did not seem to understand it when he spoke to the Confederation of British Industry recently, but the fact is that the provisions of the social chapter—its red tape and regulations—could be imposed on us by majority voting. It is no good him saying that he would pick and choose and take only those bits that he liked. That is what Labour offers—the social chapter, and imposed on us if necessary. The choice is between that and what we offer.
  We have delivered in this Budget alone a further income tax cut, a cut to the small companies rate of corporation tax, further relief from capital gains tax for those who are retiring, lower inheritance tax and a cut in national insurance contributions—funded from a tax on landfill waste—which alone will be worth £500 million off that tax on employment. We have also given more generous transitional relief for business rates. That is how to promote growth, investment and jobs.
  As regards taxation, there was not only muddle on the Labour Front Bench but a persistently expressed resentment on the Labour Back Benches that there should be tax cuts at all in the Budget. That was true not only of the Labour party but of the Liberals. It was revealing yesterday that the right hon. Member for Yeovil (Mr. Ashdown) described income tax cuts as a bribe. Conservative Members do not think that it is a bribe when people keep more of what they earn and save; it is their money. It shows how illiberal and statist the Liberals have become that they think that money belongs to the Government to be dished out as they like.
  We are on target for our 20p basic rate and the Budget achieves that for savers. They will pay tax at a basic rate of 20p from April next year. We have also achieved our target for the quarter of all taxpayers who will now pay tax on their income at only 20p in the lower rate band. The penny off the basic rate cuts marginal rates for 18 million people, who have no hope of anything similar from the Opposition.
  1306
  What did we get from the Opposition'? As my hon. Friend the Member for Blackpool, South (Mr. Hawkins) said, Labour's tax and spending plans do not add up. Right through this debate and the debate on the Queen's Speech, we had calls for more public expenditure. Earlier today, in the social security statement, the hon. Member for Islington, South and Finsbury (Mr. Smith), who leads for the Opposition, spent £1 billion in a few minutes in responding to my right hon. Friend the Secretary of State for Social Security.
  The socialist wing of the Labour party clearly believes—and always has believed—in high and rising public expenditure. That is an article of faith. I do not agree with it, but I have some respect for views constantly held and consistently argued. I have no respect for the new Labour pretence that it can all be done without putting up taxes.
  I read the shadow Budget of the hon. Member for Dunfermline, East. There was nothing in it about levels of borrowing, expenditure or interest rates and the only thing about taxation was the new 10p in the pound rate for the lower band. It was, of course, not costed—there was nothing so awkward as having to find the money for it.
  Mr. Darling: Will the Minister give way?
  Mr. Heathcoat-Amory: If the hon. Gentleman will forgive me, I still have some points to answer and only three minutes in which to do so.
  As a preface to the shadow Budget, the hon. Member for Dunfermline, East said:
  "I want to see openness and honesty in tax."
  He could have started by applying those precepts to his own Budget.
  The hon. Member for Gordon (Mr. Bruce) is not in his place. He gave notice that he would not be and I will have to send him a message through the Official Report that he is not exempt from a similar criticism. His shadow Budget, his so-called costed programme, for nearly £6 billion of extra expenditure was going to be paid for by "tax changes"—they are called not tax increases but tax changes—of £1.1 billion. Another item was "tax reform" of £990 million. There are no details about the reforms or the tax changes. If one reads "tax increases" for "tax reforms", one begins to realise that the words "openness" and "honesty" take on bizarre meanings in the mouths of Opposition spokesmen.
  The central fact is that government is not like that: we are about having to take hard decisions and make difficult choices. We have not flinched from that and the economic indicators are now pointing in the right direction. Inflation is low, growth is up, unemployment is down, borrowing is declining, investment is increasing and taxes have been cut. That may be bad news for the Labour party, but it is certainly very good news for Britain—and there is more to come. As we move towards the introduction of the Finance Bill later in the year, we shall, we hope, find out more about the Opposition's non-proposals.
  It being Ten o'clock, the debate stood adjourned.
  Debate to be resumed tomorrow.

PETITION

  Solicitors (Unprofessional Conduct)
  10 pm
  Sir Andrew Bowden: With your permission, Madam Deputy Speaker, I beg leave to present a petition, signed by more than 3,700 people, requesting that an independent regulator consider complaints against solicitors for unprofessional conduct. The petition states:
  That until the Law Society and the Solicitors Complaints Bureau are made accountable to an Independent Regulator members of the public remain open to abuse from the legal profession. A long overdue requested Public Inquiry into the handling by the Law Society and the Solicitors Complaints Bureau of Mary Blakeman's long standing complaints regarding a solicitor's unethical, unprofessional conduct will bring justification to bear on the issue. Wherefore your Petitioners pray that your honourable House will give urgent consideration to this Petition to make effective its desire because in all areas JUSTICE A 'MUST' IS!
  To lie upon the Table.

  Libya and Iraq (Sanctions)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Heathcoat-Amory.]
  10.1 pm
  Mr. Tam Dalyell: This is a debate about sanctions against two countries with which the United Kingdom has, historically, enjoyed excellent relations. Many of the decision makers in Libya and Iraq were educated in this country. As we debate the issue of sanctions, we also debate our country's long-term relations with two very important areas of the Arab world.
  Anyone who visits Iraq must be dismayed that a once sophisticated society should be reduced to grinding poverty in many areas. Every recent visitor to that country—including the right hon. Members for Old Bexley and Sidcup (Sir E. Heath) and for Tweeddale, Ettrick and Lauderdale (Sir D. Steel), the former leader of the Liberal party, and many others—is appalled, as I was, by the terrible conditions in the children's hospital in Baghdad or the conditions in another hospital at Um-Kasr on the Kuwaiti border. Infants, who cannot conceivably be responsible for any of the horrors of the past 10 years, expired in my presence—and I do not exaggerate.
  The most recent visitor to Iraq with whom I have been in contact is Riad El-Taher, an Iraqi-born British subject. He is concerned about the British Government's entrenched support for United Nations Security Council resolution 986. He writes:
  "Can I bring to your attention … the long term erosion of trust and historical ties taking root among the upcoming generation".
  I sensed that during my visit.
  "The majority of UK educated Iraqis are reaching retirement age and are being replaced by a generation fed on suspicion of the West and particularly Britain's continued support of sanctions."
  I mentioned that issue at Question Time, and I say as gently as I can, and I hope without giving offence, that I wonder whether the Minister, his colleagues and his civil service advisers really realise the extent to which a generation is growing up about to hate the west—people who have been trading partners and friends. It is tragic.
  "UNSCR 986 is heavily biased, being intrusive, divisive and certainly not addressing the chronic humanitarian shortages of food and medicine. These shortages are felt most strongly among the young generation … and the salaried sector in general. The financial benefit, if Iraq manages to sell the allocated oil, after deduction of the heavy burden of reparations, administration and allocation to the Northern Governorate under UN supervision, will be in the region of 7–8 US$ per person per month (outside Iraq)."
  That places seriously in question the assertions that it is simply up to Saddam Hussein to change policy, and all will be well. I fear that the detail of what is happening shows that that certainly would not be the outcome.
  One is forced to take the view that UNSCR 986 was not intended to provide humanitarian aid to the Iraqi people, in view of five factors. Both the UK and USA hold substantial Iraqi frozen assets, which could be controlled effectively for the sole purchases of badly needed food and medicine from their respective countries and for immediate release. Even if Iraq were prepared to agree to UNSCR 986, there are no guarantees that funds would be available from the sale of oil or for the purchase of humanitarian requirements, due to the complexity of

  1309
  the contractual demands. The reparations burden should be set aside at this stage, as Iraq can tackle that issue when sanctions are lifted. The rest of the argument is well known to the Foreign Office.
  I simply say to the Minister, and through him to the Foreign Secretary, that the right hon. and learned Gentleman the Foreign Secretary should go to some of his constituents, the Church and Nation Committee of the Church of Scotland—he represents many of the leading members of the Church of Scotland in the Pentlands constituency of Edinburgh—and speak to them about their detailed knowledge and their knowledge of the humanitarian position.
  Hansard records that, on 21 December 1988, I raised the subject of Libyan sanctions in the House. From new year's eve 1988, for reasons that I have outlined in seven previous Adjournment debates, I have had a deep interest in the subject.
  Tonight, I make two requests. First, is it not time, after seven years, that the crucial timing device is produced? Let independent experts examine the timing device, because so far only photographs have been produced, and the head of the firm of manufacturers, Edwin Bollier, and his engineer, Ulrich Lumpart, have not even been allowed to see it.
  I ask specific questions of which I gave notice to the Lord Advocate and the Crown Office in Edinburgh, which they undertook to pass on to the Minister. Is the Minister aware that Thomas Thurman, the Federal Bureau of Investigation officer who claims to have identified the timing device, is under investigation by the US Justice Department regarding allegations by a fellow FBI officer, Frederick Whitehurst, that he fabricated evidence and committed perjury in a murder trial in the USA? That was outlined in The Scotsman by a remarkable reporter, Stephen Breen. I have cross-checked with other sources, however.
  Does the Thurman/White House situation lead Her Majesty's Government at least to question the credibility of Thurman, and the credibility of the Crown's identification of the timing device? Should Thurman be found guilty of perjury, would the Crown reassess the evidence and case against the two Libyans, given that the timing device is the key evidence linking the Libyans and the bombing?
  The whole story of so-called evidence from Mary's House in Valletta, and the 18 different identifications of Tony Gouchie, would be very flimsy in any court of law. Where, we ask, is this timer? Has it ever been out of the United Kingdom? Who found it? When was it found, and where? The imagination boggles. A timer supposedly in pristine condition was out in a Scottish winter for 15 months or so. I do not believe that the timer on the Pan Am clipper "Maid of the Seas" is in the possession of the authorities; I believe that they have a photograph of a rather different timer.
  I have done my best in regard to my next point, and I also understand the Prime Minister's reasons. Before my question to him about the last issue that I shall raise is dealt with, let me issue a request that serious consideration, at least, be given to the Libyan suggestion of a trial in The Hague, under Scottish rules of evidence
  1310
  and under a Scottish judge. I feel that, after seven years, there is a strong argument for considering that as a serious possibility.
  I am pleased to see that my right hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) is present, because he has had a deep interest in Malta ever since we worked together when he led the Labour European delegation to the European Parliament. He had a good deal to do with Malta then. I shall not speak for my right hon. Friend, however; I shall speak for myself.
  I do not believe that there ever was a Malta connection. We had hoped, yet again—along with the relatives, who have been steadfast and will not go away—to see the Prime Minister before these questions were asked. I do not believe in yah-boo Prime Minister's Question Time. The Prime Minister wrote to me:
  "I have considered carefully whether I might meet Jim Swire, Pamela Dix and Martin Cadman before your question. Unfortunately I fear that my diary is such that there will be no possibility before then."
  The offer has been made, but I hope that the Government will look carefully at the possibility of a trial in The Hague to bring the matter to a head.
  I suspect that the reason why the Government do not want to go to The Hague is quite simple: they realise only too clearly that a Scottish judge, under Scottish rules of evidence, might well humiliate them by saying at an early stage that there was no case to answer.
  It really is unrealistic to suggest that the Libyan Government ought to send the two to Britain. If the boot were on the other foot, would Her Britannic Majesty's Government extradite two men whom her country believed to be innocent to Libya, with which Britain has no extradition treaty? I doubt whether any British Government or the House would do any such thing. After seven years, the time has come to take some action, at least to try The Hague, because, if not, the suspicion exists that the Governments of the United States and Britain do not want the truth about Lockerbie.
  10.14 pm
  The Minister of State, Foreign and Commonwealth Office (Mr. Jeremy Hanley): I should like to begin with a few general points on the use of sanctions. The decision to impose sanctions on a country cannot be taken lightly. Under the UN charter, if a country threatens international peace and security, as both Iraq and Libya have done, the Security Council is empowered under chapter 7 of its charter to take action. On that point, I should like to clarify why there are sanctions on Iraq and Libya and not on Nigeria. The human rights abuses in Nigeria, while abhorrent, are an internal situation and therefore cannot be classified under this chapter.
  As much as possible, sanctions are tailored to ensure that they are not just punitive but counter the wrong that has been committed. The aim of sanctions is to counter threats to peace and security, and to try to get the penalised country back into line with the international community. That approach is reflected in our policy towards Libya and Iraq, in which sanctions play a central part.
  Before I respond to the specific points raised by the hon. Member for Linlithgow (Mr. Dalyell), I shall recall the reasons behind the sanctions against Libya and Iraq—first, Libya.

  1311
  Sanctions were imposed by the Security Council in March 1992 and in November 1993 because Libya had failed to comply with the requests of the United Kingdom, United States and French Governments, following the bombing of Pan Am flight 103 over Lockerbie on 21 December 1988 and a Union des Transports Aerien aircraft over Niger in September 1989. It is worth reflecting just for a moment on the scale of those outrages. The first involved the death of 270 innocent persons; the second, 171—a total of 441 victims.
  After the biggest criminal investigation in British history, the Dumfries and Galloway constabulary had by November 1991 uncovered sufficient evidence to enable charges to be brought against two Libyan nationals in connection with the Lockerbie bombing. The UK and the US called on the Libyan Government to surrender the accused for trial, to tell what they knew of the crime, and to pay appropriate compensation.
  The Libyan Government failed to do any of those things. Through UN Security Council resolution 731, in January 1992, the international community endorsed the UK and US calls on Libya in connection with Lockerbie, and the French calls regarding UTA, but still Libya failed to comply. The sanctions resolutions 748 and 883 were designed to put pressure on the Government of Libya—not its people—to surrender the suspects for trial and to meet the other requirements. We regret that Libya has still not complied. By its failure to do so, it continues to deny justice to the victims or to prove the innocence of the accused.
  The House will recall that, on 1 February this year, my right hon. Friend the Member for Witney (Mr. Hurd), who was then Foreign Secretary, reported exchanges that Foreign Office officials had been having with the Libyans about the material and financial assistance that Libya had given to the Provisional IRA, at a time when it was waging a terror campaign against British interests. That was in the context of one of Libya's obligations under the resolutions: to demonstrate its renunciation of terrorism.
  At the time, there remained some unanswered questions. Since then, there has been another exchange of questions and answers. As a result, on 20 November last, the Foreign and Commonwealth Office issued a statement making it clear that, while there remained gaps and omissions in the information given by the Libyans, we were satisfied that, when the disclosures were considered in their entirety, they largely met our expectations.
  In acknowledging that as a positive step towards Libyan renunciation of terrorism, a path that we hoped that Libya would follow, we made it clear that we regarded Libya's co-operation as just one step in the context of one of its obligations under the resolutions. We remained committed to the UN sanctions against Libya until such time as Libya complied with all the requirements, in particular that it surrender those accused of the Lockerbie bombing for trial in Scotland or in the United States. I can tell the House that we have no further questions to put to the Libyans about that.
  At the most recent four-monthly review of sanctions by the Security Council of 22 November, the UK permanent representative to the United Nations, Sir John Weston, drew the attention of the Security Council to the statement on the Provisional IRA questions. He added that we remained committed to bringing to justice those responsible for the Pan Am and UTA bombings, and that
  1312
  alternatives put forward by the Libyans for trial elsewhere—including The Hague, as the hon. Gentleman said—were simply not acceptable. Sir John Weston reminded the council that all countries must continue to implement the mandatory sanctions rigorously. There was no proposal at that review for a change to the existing sanctions, and they must therefore remain in force.
  We have regularly and carefully considered the various proposals that have been put forward from time to time that a trial be held in a third country, and we remain convinced that they are unacceptable and unworkable. The reasons have been stated before in the House, but since the hon. Gentleman has raised the matter, they bear repeating.
  First, the practical and legislative difficulties would be enormous. They would involve secondary and possibly primary legislation in both countries.
  Secondly, it would be quite unacceptable to the Government, as well as to the House, effectively to allow suspected terrorists to dictate where and how they should be tried. The Scottish and US courts both have jurisdiction. The trial should be held in one of those jurisdictions.
  Thirdly, the Security Council resolutions call for a trial in the UK or the US.
  Fourthly, holding the trial in a third country might imply that the Lockerbie suspects could not get a fair trial in Scotland. The Libyan Government indicated in 1993 that they accepted that the suspects would get a fair trial in Scotland.
  Finally, even if it were possible to set up such a court, there is no credible guarantee that the suspects would be made available for trial. Even if all the other difficulties that I have just outlined were resolved, I would be most reluctant to set in motion a complex procedure of legislation and international agreements that could too easily lead to nothing.
  The Libyan Government have never undertaken to hand the accused over for trial anyway. Indeed, they have maintained that they have no powers to force the suspects to go for trial anywhere. Against that background, the scope for further prevarication after all the arrangements had been put in place would be enormous. So for all those reasons, we have concluded that a trial in a third country remains unacceptable.
  We understand that the proposal currently preferred by the Libyans, and endorsed by the Arab League, is a trial before Scottish judges under Scottish law at the seat of the International Court of Justice in The Hague. As I have said, that proposal is unacceptable, for the same reasons as any trial in a third country.
  We are conscious that Libya has been under the pressure of sanctions for over three and a half years. Libya's attempts to promote so-called compromise solutions and alternatives to trial in Scotland and the US show that the pressure is having an effect, and we should not waver. The pressure should remain on Libya until it does what the international community demanded in 1992. We ask no more or less than that.
  In the meantime, we must at all costs avoid prejudicing the trial. For that reason, we cannot, as has been suggested, show the timer used in the explosion to its manufacturer, or, for that matter, disclose any of the other evidence.

  1313
  The hon. Gentleman referred to the activities of Mr. Thomas Thurman, an American forensic scientist. The Minister of State, Foreign and Commonwealth Office, my hon. Friend the Member for Upminster (Sir N. Bonsor), told the hon. Gentleman on 10 November that the forensic examination in the Lockerbie investigation was conducted by the Royal Armaments Research and Development Establishment. My noble and learned Friend the Lord Advocate told the hon. Gentleman on 6 October that the Lockerbie case did not depend on any evidence that Mr. Thurman might give.
  What may or may not have happened in the United States to cause the FBI to investigate the activities of Mr. Thurman has no bearing on the evidence that forms the basis of the Scottish petition warrant.
  Widely diverging stories have appeared in the press and elsewhere on the recovery of fragments of the timer in that case. Those stories have been based on speculation, and it should therefore come as no surprise that they are indeed divergent. I can go into no further detail on the evidence, which includes recovery of any of the physical evidence, for fear of prejudicing the case.
  As in the case of Libya, the aim of sanctions against Iraq is clear. It is to ensure that Iraq fully complies with its obligations under the relevant UN Security Council resolutions. It is simply not true to say that sanctions are not working. They have achieved a measure of Iraqi compliance with the requirements of UN Security Council resolutions—notably, Iraqi recognition of Kuwait and UN-demarcated borders.
  Without the pressure of sanctions, it is unlikely that Iraq would have revealed to the UN special commission information on its development of weapons of mass destruction. UNSCOM has recently discovered the horrifying capabilities that Iraq has tried to conceal: enough chemical and biological weapons to kill the world's population several times over. UNSCOM's work on Iraq's weapons of mass destruction programme is essential for the security of the region, indeed the world. We give it strong support.
  Nevertheless, Iraq still falls short of its other obligations. Time permits me to mention only a few. First, despite UNSCOM's recent discoveries, much remains to be done in respect of Iraq's weapons of mass destruction programme. Secondly, Iraq has an appalling human rights record. To hon. Members who have a strong stomach, I commend the recent report by the UN's special rapporteur on human rights, Mr. van der Stoel, which recounts nauseating acts of torture committed by the Iraqi regime, as well as denial to Iraq's population of the most basic human rights. Thirdly, Iraq has failed to account for the whereabouts of more than 600 missing Kuwaiti and third-country nationals and property, including military hardware, stolen from Kuwait.
  Recent history shows that Saddam Hussein cannot be given the benefit of the doubt. The UN Security Council reviews sanctions every 60 days in the light of Iraq's behaviour. At the last review on 8 November, it agreed that sanctions could not be modified. There is no doubt that that was right. Sanctions must be maintained until Iraq fully complies with its international obligations under relevant UN Security Council resolutions.
  1314
  We share the concern of many right hon. and hon. Members about the desperate plight of Iraqi citizens. The hon. Member for Linlithgow said that we were making enemies of a whole generation of young Iraqis, but I wonder whether it is right to make enemies of the rest of the world. It is nonsense to blame the shortages and deprivations on the UN. Food and medicines are not subject to sanctions.
  Rather than buy food, Saddam Hussein has chosen to spend the regime's limited resources on military procurement, ostentatious construction projects and luxury items for his hangers-on. For example, Mr. van der Stoel notes that members of the Ba'ath party and military officers have their own food distribution network. Saddam, not the UN, bears full responsibility for the suffering of the Iraqi people.
  To try to alleviate the suffering of the Iraqi people, the UK played a leading role in the unanimous adoption of UN Security Council resolution 986, which would allow Iraq to export a substantial quantity of oil in return for humanitarian aid. The resolution was designed to accommodate criticisms of earlier offers made by the UN under resolutions 706 and 712. It increases the amounts of oil that Iraq could export and is more flexible in the arrangements for monitoring distribution of supplies. Were it to implement resolution 986, Iraq could purchase substantial amounts of humanitarian supplies. The hon. Gentleman said that this was about $6 or $7 per person per month. That is approximately $2.5 billion-worth per annum. That compares with $5 billion spent on all civilian goods before the Gulf war. Sadly, Iraq has refused to implement it. We urge Iraq to implement this humanitarian resolution, to relieve the suffering of the Iraqi people.
  We have also been helping the Iraqi people more directly. Since 1991, we have given more than £72 million to the humanitarian effort in Iraq. The Overseas Development Administration is also spending substantial sums on aid to Iraq this financial year. I pay tribute to the British and other humanitarian non-governmental organisations working in the area, and to the group from the Scottish churches. My right hon. and learned Friend the Secretary of State asked me to meet them only last week. I did, and I was pleased to listen to them and discuss matters, but they too recognise that resolution 986 has been implemented by a unanimous international agreement.
  The recent developments in the resolution of the Bosnia crisis are an example of sanctions being effective. The promise of the suspension of sanctions was a key factor in bringing President Milosevic to the negotiating table in Dayton, and in bringing about the signing of the peace agreement. The resulting UN resolution which the Security Council adopted last week was a just reward for that achievement.
  Let us pray that the leaders in Libya and Iraq rise to their responsibilities, and take the necessary steps to help their people to answer those who demand justice, and to rejoin the international community of good will whose only aim is to work for peace.
  Question put and agreed to.
  Adjourned accordingly at twenty-nine minutes to Eleven o'clock.

HOUSE OF COMMONS

  Quality of Service Survey
  Mr. Dalyell
  To ask the right hon. Member for Berwick-upon-Tweed, as representing the House of Commons Commission, if he will list(a) the cost of the Serjeant at Arms quality of service survey and (b) the payment to Janet Levin Associates for its services in connection with the survey. [2435]

  Mr. Beith
  The final cost of the survey is dependent on the amount of work which is considered necessary at each stage to complete it satisfactorily. I have asked the Serjeant at Arms to write to the hon. Member with details.

PRIME MINISTER

  Cyprus
  Mr. Cox
  To ask the Prime Minister what issues concerning Cyprus were discussed by him during his recent meeting with the Prime Minister of Turkey; and if he will make a statement. [3171]

  The Prime Minister
  I discussed with Mrs. Ciller the prospects for a solution of the Cyprus problem. We agreed that the status quo was not acceptable. I urged Mrs. Ciller to bring positive Turkish influence to bear in moving towards a settlement.

LORD CHANCELLOR'S DEPARTMENT

  Legal Aid
  Mr. Marshall
  To ask the Parliamentary Secretary, Lord Chancellor's Department when the Green Paper on legal aid to the seemingly wealthy was published; when the consultation period ended; and when a decision will be announced. [2001]

  Mr. Evans
  The Lord Chancellor published his consultation paper on legal aid for the apparently wealthy on 20 December 1994. The consultation period ended on 1 March 1995 and a press release listing the Lord Chancellor's proposals was issued on 26 April 1995. A

  CPS England Magistrates' Courts cases

  Of which…

  Received

  Dealt with1

  Completed in Magistrates Courts

  Discontinued

  Committed to Crown Court

  Other disposals2

  Year ending September 1993

  1,365,586

  1,285,624

  898,921

  173,423

  97,121

  116,109

  Year ending September 1994

  1,354,692

  1,245,974

  868,062

  148,440

  98,563

  130,909

  690
  report by the study group on the establishment of the special investigations unit will go before the Lord Chancellor in the near future. Proposed amendments to the regulations will be placed before Parliament early in 1996.

  Justices of the Peace
  Mr. John D. Taylor
  To ask the Parliamentary Secretary, Lord Chancellor's Department how many justices of the peace there are per 1,000 persons in each of the district council areas in Northern Ireland. [1668]

  Mr. Jonathan Evans
  Justices of the peace are appointed to serve in county court divisions. Details of the number of justices of the peace per 1,000 persons in each division in Northern Ireland are as follows:

  Ards: 1.7

  Antrim: 1.3

  Armagh and South Down: 1.6

  Belfast: 2.0

  Craigavon: 2.0

  Fermanagh and Tyrone: 1.0

  Londonderry: 2.0.

ATTORNEY-GENERAL

  Crown Prosecution Service
  Mr. Llwyd
  To ask the Attorney-General if he will list for(a) each court circuit in Wales, (b) for Wales as a whole and (c) for England for each of the last three years for which figures are available: (i) the number of cases submitted to the Crown Prosecution Service by the police for consideration of bringing proceedings, (ii) the number of prosecutions brought by the Crown Prosecution Service and (iii) the figures in (ii) expressed as a percentage of (i); and if he will make a statement. [1090]

  The Attorney-General
  The tables of figures show the number of cases received from the police and those dealt with by the Crown Prosecution Service during the last three years, for Wales and for England. The figures comprise proceedings in the magistrates courts, but do not include the specialised casework handled by the headquarters of the service. No figures are held for individual court circuits.

  The percentage of cases discontinued, expressed as a proportion of those dealt with, was:

  Wales percentage

  England percentage

  Year ending September 1993

  11.8

  13.5

  Year ending September 1994

  11.1

  11.9

  Year ending September 1995

  12.1

  11.9

  691

  CPS England Magistrates' Courts cases

  Of which…

  Received

  Dealt with1

  Completed in Magistrates' Courts

  Discontinued

  Committed to Crown Court

  Other disposals2

  Year ending September 1995

  1,293,999

  1,243,964

  861,904

  147,561

  89,566

  144,933

  1Cases dealt with comprise all those completed, excluding advice cases and non criminal proceedings.

  2Other disposals comprise committal hearings in which the defendant was discharged, cases in which the defendant was bound over to keep the peace, instances where the defendant could not be found, and other cases in which the prosecution could not proceed (e.g., through the death of the defendant).

  CPS Wales Magistrates' Courts cases

  Of which…

  Received

  Dealt with1

  Completed in Magistrates' Courts

  Discontinued

  Committed to Crown Court

  Other disposals2

  Year ending September 1993

  105,328

  105,407

  72,623

  12,401

  6,144

  14,239

  Year ending September 1994

  100,736

  95,759

  65,521

  10,645

  5,698

  13,895

  Year ending September 1995

  95,815

  90,826

  63,442

  11,033

  5,662

  10,689

  1 Cases dealt with comprise all those completed, excluding advice cases and non criminal proceedings.

  2 Other disposals comprise committal hearings in which the defendant was discharged, cases in which the defendant was bound over to keep the peace, instances where the defendant could not be found, and other cases in which the prosecution could not proceed (e.g., through the death of the defendant).

NATIONAL HERITAGE

  Football Trust
  Ms Lynne
  To ask the Secretary of State for National Heritage what was the income of the Football Trust in each week since 1 November 1994(a) in total, (b) from pool betting duty and (c) from "spot the ball". [2268]

  Mr. Sproat
  The information contained in the following table has been obtained from the Football Trust.

  The Football Trust: Weekly income since November 1994

  Week ending

  Total income £

  Pool betting duty £

  Spot the ball £

  1994 November

  4

  733,750

  473,752

  259,998

  11

  724,750

  468,851

  255,899

  18

  758,972

  479,946

  279,026

  25

  730,158

  473,315

  256,843

  December

  2

  703,908

  455,816

  248,092

  9

  694,337

  450,908

  243,429

  16

  675,709

  448,161

  227,548

  23

  696,142

  460,085

  236,057

  30

  1,460,364

  924,477

  535,887

  1995 January

  6

  119,323

  116,368

  2,955

  13

  161,749

  160,420

  1,329

  20

  583,560

  393,654

  189,906

  27

  610,005

  404,662

  205,343

  February

  3

  614,825

  408,250

  206,575

  10

  605,460

  408,357

  197,103

  17

  606,123

  401,609

  204,514

  24

  599,293

  398,305

  200,988

  692

  The Football Trust: Weekly income since November 1994

  Week ending

  Total income £

  Pool betting duty £

  Spot the ball £

  March

  3

  594,043

  398,545

  195,498

  10

  584,063

  389,026

  195,037

  17

  579,733

  386,974

  192,759

  24

  586,984

  386,892

  200,092

  31

  578,654

  381,238

  197,416

  April

  7

  565,827

  369,835

  195,992

  14

  565,397

  372,364

  193,033

  21

  567,903

  375,494

  192,409

  28

  551,028

  363,933

  187,095

  May

  5

  475,885

  349,427

  126,458

  12

  491,057

  354,366

  136,691

  19

  483,546

  354,411

  129,135

  26

  462,926

  336,321

  126,605

  June

  2

  466,731

  335,725

  131,006

  9

  459,213

  328,176

  131,037

  16

  428,790

  311,703

  117,087

  23

  443,163

  321,627

  121,536

  30

  434,357

  313,315

  121,042

  July

  7

  435,190

  312,106

  123,084

  14

  427,861

  309,524

  118,337

  21

  411,226

  297,011

  114,215

  28

  420,019

  304,625

  115,394

  August

  4

  414,367

  299,673

  114,694

  11

  399,916

  289,773

  110,143

  18

  382,969

  279,530

  103,439

  25

  397,699

  289,334

  108,365

  September

  1

  409,326

  299,532

  109,794

  8

  404,044

  297,407

  106,637

  15

  400,544

  295,237

  105,307

  22

  410,667

  302,533

  108,134

  29

  415,098

  306,839

  108,259

  693

  The Football Trust: Weekly income since November 1994

  Week ending

  Total income £

  Pool betting duty £

  Spot the ball £

  October

  6

  407,116

  300,100

  107,016

  13

  405,738

  297,780

  107,958

  20

  407,511

  298,040

  109,471

  27

  411,044

  301,645

  109,399

  November

  3

  405,125

  295,681

  109,444

  10

  405,849

  298,747

  107,102

  17

  404,842

  294,120

  110,722

  Ms Lynne
  To ask the Secretary of State for National Heritage what has been the annual income of the Football Trust for each year since 1990. [2269]

  Mr. Sproat
  This information is available from the Football Trust annual reports held in the Library of the House.

  Swimming and Recreation Centres
  Mr. Menzies Campbell
  To ask the Secretary of State for National Heritage what is the number of public swimming baths and recreation centres per head of population; what is the equivalent figure for other European Union member states; and if she will make a statement. [1534]

  Mr. Sproat
  Latest figures for England, based on 1991 population census and the Sports Council's sports facilities database, are for one swimming pool for every 43,429 of the population and one sports centre for every 32,572 of the population. Equivalent figures for Scotland, Wales, and Northern Ireland are the responsibility of the respective Secretaries of State. We do not hold comparative data for other European Union member states.

  Millenium Exhibition
  Mr. Dafis
  To ask the Secretary of State for National Heritage what provisions are being made to ensure that charity, Church and other non-commercial organisations will be able to fully participate in the millennium exhibition. [373]

  Mrs. Bottomley
  This is a matter for the Millennium Commission. I shall reply to the hon. Member in my capacity as chairman of the commission and place copies of my reply in the Libraries of the House.

TREASURY

  Labour Statistics
  Mr. Simon Hughes
  To ask the Chancellor of the Exchequer if he will list the unemployment rates by sex, age and ethnic origin for each year from 1989 using the latest labour force survey. [2848]

  Mrs. Angela Knight
  Comparable information on International Labour Organisation unemployment by sex, age and ethnic origin is available from the labour force survey (LFS), quarterly from spring 1992 onwards. It can be obtained via the Quantime LFS service available in the 694
  Library. Information for the average of the three years 1989–91 is available from the February 1993 issue of the Employment Gazette, which is also available from the Library.

  Mr. Hughes
  To ask the Chancellor of the Exchequer if he will list employment by broad occupation, by ethnic origin and by sex for each year from 1991. [2850]

  Mrs. Knight
  Comparable information on employment, by occupation, ethnic origin and sex is available from the labour force survey quarterly from spring 1992 onwards. It can be obtained via the Quantime LFS service available in the Library.

  Mr. Hughes
  To ask the Chancellor of the Exchequer what are the proportions of(a) men and (b) women by ethnic origin who are working as (i) full-time employees, (ii) part-time employees and (iii) self-employed. [2847]

  Mrs. Knight
  Estimates from the labour force survey are shown in the table.

  Men and women, by ethnic origin in employment Great Britain, spring 1995

  Proportion (percentage) of those who are in employment who are:

  Full-time employees

  Part-time employees

  Self-employed

  Men

  White

  75

  6

  18

  All ethnic minority groups

  71

  9

  18

  Black

  73

  10

  13

  Indian

  74

  7

  18

  Pakistani/Bangladeshi

  61

  10

  25

  Mixed/other origins

  70

  11

  17

  Women

  White

  51

  40

  7

  All ethnic minority groups

  63

  30

  5

  Black

  69

  26

  n/a

  Indian

  60

  32

  7

  Pakistani/Bangladeshi

  61

  29

  n/a

  Mixed/other origins

  61

  31

  n/a

  n/a—not available, based on estimate below 10,000.

  Mr. Hughes
  To ask the Chancellor of the Exchequer if he will list employment by industry for each year from 1991 of(a) men and (b) women broken down into (i) whites and (ii) ethnic minorities. [2849]

  Mrs. Knight
  Comparable information on employment, by industry, ethnic origin and sex is available from the labour force survey, quarterly from spring 1992 onwards. It can be obtained via the Quantime LFS service available in the Library.

  Executive Agencies
  Mr. Redmond
  To ask the Chancellor of the Exchequer if he will list for each of his executive agencies for the last financial year in respect of overseas travel by agency staff(a) the costs of the travel, (b) the countries visited and (c) the posts held by the staff concerned. [2283]
  695
  Mrs. Knight
  The information for the Chancellor of the Exchequer's four agencies is as follows:

  Cost of overseas travel 1994–95

  Countries visited

  Posts held by travelling staff

  Central Statistical Office

  £159,661

  Countries of the European Community Switzerland, Scandinavia, United States of America, Canada, Australia, New Zealand, China, Hong Kong

  Directors (Grades la to Grade 4) Heads of Inquiry Divisions, Branches and Sections (Grades 5–7) Heads of Statistical Units (Grades of 5–7) Heads of Service Divisions, Branches and Sections and staff (Grades EO to Grade 5) Statistical staff (SEO to Assistant Statistician)

  PAYMASTER There was no overseas travel by staff of the PAYMASTER in the last financial year.

  Royal Mint This information could only be provided at disproportionate cost. The Mint is a commercial organisation which carries out more than two-thirds of its business for export. This necessarily entails extensive overseas visits by Mint staff.

  Valuation Office Agency

  Only one overseas visit as follows:

  Cost of overseas travel 1994–95

  Countries visited

  Posts held by travelling staff

  £275

  Dublin, Ireland

  Grade 5 and 7

  Single Currency
  Mr. Gill
  To ask the Chancellor of the Exchequer (1) what preparations have been made within the Treasury in anticipation of the single currency; [2772]

  (2) what preparations the Bank of England has made in anticipation of the introduction of the single currency. [2771]

  Mrs. Angela Knight
  The Chancellor of the Exchequer is a member of the ECOFIN Council. The Governor of the Bank of England is a member of the European Monetary Institute Council. Treasury and the Bank of England both have representatives on the

  Contributions to and receipts from the EU—12 Budget in 1990 and 1994

  1990 ecu/£ = 1.39

  Gross contribution (mecu)

  Gross Receipts £ million

  Net Contribution/Receipt (mecu)

  £ million

  (mecu)

  £ million

  Belgium

  1,763.7

  1,268.8

  989.8

  712.1

  -773.9

  -556.8

  Denmark

  775.1

  557.6

  1,197.6

  861.6

  422.5

  304.0

  Germany

  10,357.5

  7,451.4

  4,807.1

  3,458.3

  -5,550.4

  -3,993.1

  Greece

  563.6

  405.5

  3,033.8

  2,182.6

  2,470.2

  1,777.1

  Spain

  3,671.1

  2,641.3

  5,382.7

  3,872.4

  1,711.3

  1,231.2

  France

  8,089.5

  5,819.8

  6,284.6

  4,521.3

  -1,804.9

  -1,298.5

  Ireland

  368.2

  264.9

  2,260.7

  1,626.4

  1,892.5

  1,361.5

  Italy

  6,097.7

  4,386.8

  5,681

  4,087.1

  -416.7

  -299.8

  696
  EU monetary committee. Under the EC treaty, ECOFIN, the EMI and the monetary committee are all involved in preparatory work for a single currency.

  The United Kingdom's involvement in preparatory work in no way prejudges the UK's decision whether or not to notify our intention to move to stage 3 of EMU, in accordance with the provisions of protocol 11 annexed to the EC treaty.

  Under protocol 11 annexed to the UK treaty, the Prime Minister has ensured 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.

  Tax
  Mr. Robert Ainsworth
  To ask the Chancellor of the Exchequer how much tax was remitted or written off as irrecoverable in 1994; and how much of this was PAYE contributions. [83]

  Mr. Jack
  The total amount of tax remitted or written off as irrecoverable in the year ended 28 October 1994 was £1.16 billion—about 1.4 per cent. of the total tax collected, and some 26 per cent. lower than the figure for the previous year.

  The amount of PAYE contributions remitted or written off in the year ended 28 October 1994 was £270.13 million, some 32 per cent. less than the previous year.

  Insolvencies, where the Inland Revenue has very little control over the amount recoverable, account for the vast majority of tax written off or remitted.

  EU Contributions
  Mr. Spearing
  To ask the Chancellor of the Exchequer what was(a) the gross contributions, receipts and net contributions or receipts, (b) the population and approximate number of households and (c) the net contributions or receipts per head and per household of each state which was a member of the EU before the treaty of Corfu for (a) 1990 and (b) 1994, in (i) ecus and (ii) £ sterling. [2513]

  Mr. Heathcoat-Amory
  This information is set out in the table. This covers the former European Union of 12 member states. Following the conclusions of the European Council in Corfu in June 1994, Sweden, Austria and Finland proceeded to join the Union at the beginning of this year.
  697

  Contributions to and receipts from the EU—12 Budget in 1990 and 1994

  1990 ecu/£ = 1.39

  Gross contribution (mecu)

  Gross Receipts £ million

  Net Contribution/Receipt (mecu)

  £ million

  (mecu)

  £ million

  Luxembourg

  74.5

  53.6

  14.5

  10.4

  -60

  -43.2

  Netherlands

  2,615.2

  1,881.4

  2,983.6

  2,146.5

  368.4

  265.0

  Portugal

  502.4

  361.4

  1,103.2

  793.7

  600.8

  432.2

  United Kingdom

  6,534.3

  4,700.9

  3,147.4

  2,264.3

  -3,386.9

  -2,436.6

  1990 ecu/£ = 1.39

  Population Millions

  Number of households Millions

  Net per head (ecu)

  £

  Net per household (ecu)

  £

  Belgium

  9.9

  3.95

  -78.2

  -56.2

  -196

  -141.0

  Denmark

  5.1

  2.27

  82.8

  59.6

  186

  133.9

  Germany

  79.1

  35.26

  -70.2

  -50.5

  -157

  -113.2

  Greece

  10.1

  3.2

  244.6

  176.0

  772

  555.4

  Spain

  38.8

  11.84

  44.1

  31.7

  145

  104.0

  France

  56.6

  21.54

  -31.9

  -22.9

  -84

  -60.3

  Ireland

  3.5

  1.03

  540.7

  389.0

  1,837

  1,321.9

  Italy

  56.7

  19.91

  -7.3

  -5.3

  -21

  -15.1

  Luxembourg

  0.4

  0.15

  -150.0

  -107.9

  -400

  -287.8

  Netherlands

  14.9

  6.16

  24.7

  17.8

  60

  43.0

  Portugal

  9.9

  3.15

  60.7

  43.7

  191

  137.2

  UK

  57.5

  22.42

  -58.9

  -42.4

  -151

  -108.7

  Notes:

  1. Contribution figures are after abatement.

  2. Administration costs are not fully allocated by member state in the Court of Auditors Report. Allocation of administrative spending would increase gross receipt figures for Belgium and Luxembourg.

  3. Figures for population and households in Germany are for unified Germany for both 1990 and 1994.

  4. Figures for number of households are the latest available and refer to 1990–91.

  Source:

  Court of Auditors Reports and Eurostat.

  1994 ecu/£=1.29

  Gross contribution (mecu)

  £ million

  Gross receipts (mecu)

  £ million

  Net contribution (mecu)

  £ million

  Belgium

  2,822.1

  2,187.7

  2,512.8

  1,947.9

  -309.3

  -239.8

  Denmark

  1,296.2

  1,004.8

  1,495.1

  1,159.0

  198.9

  154.2

  Germany

  21,366.3

  16,563.0

  7,729.2

  5,991.6

  -13,637.1

  -10,571.4

  Greece

  992.3

  769.2

  4,844.2

  3,755.2

  3,851.9

  2,986.0

  Spain

  4,718.1

  3,657.4

  7,834.7

  6,073.4

  3,116.6

  2,416.0

  France

  12,550.9

  9,729.4

  9,924.5

  7,693.4

  -2,626.4

  -2,036.0

  Ireland

  638.9

  495.3

  2,390.9

  1,853.4

  1,752

  1,358.1

  Italy

  7,759.6

  6,015.2

  5,219.2

  4,045.9

  -2,540.4

  -1,969.3

  Luxembourg

  165.4

  128.2

  419.1

  324.9

  253.7

  196.7

  Netherlands

  4,245.9

  3,291.4

  2,416

  1,872.9

  -1,829.9

  -1,418.5

  Portugal

  1,215.6

  942.3

  3,042.6

  2,358.6

  1,827

  1,416.3

  United Kingdom

  6,417.4

  4,974.7

  5,258.6

  4,076.4

  -1,158.8

  -898.3

  1994 ecu/£ = 1.29

  Population millions

  Number of households millions

  Net per head (ecu)

  £

  Net per household (ecu)

  £

  Belgium

  10.1

  3.95

  -30.6

  -23.7

  -78

  -60.7

  Denmark

  5.2

  2.27

  38.2

  29.7

  88

  67.9

  Germany

  81.3

  35.26

  -167.7

  -130.0

  -387

  -299.8

  Greece

  10.4

  3.2

  370.4

  287.1

  1,204

  933.1

  Spain

  39.1

  11.84

  79.7

  61.8

  263

  204.1

  France

  57.8

  21.54

  -45.4

  -35.2

  -122

  -94.5

  Ireland

  3.6

  1.03

  486.7

  377.3

  1,701

  1,318.6

  Italy

  57.1

  19.91

  -44.5

  -34.5

  -128

  -98.9

  698

  699

  1994 ecu/£ = 1.29

  Population millions

  Number of households millions

  Net per head (ecu)

  £

  Net per household (ecu)

  £

  Luxembourg

  0.4

  0.15

  634.3

  491.7

  1,691

  1,311.1

  Netherlands

  15.3

  6.16

  -119.6

  -92.7

  -297

  -230.3

  Portugal

  9.9

  3.15

  184.5

  143.1

  580

  449.6

  UK

  58.3

  22.42

  -19.9

  -15.4

  -52

  -40.1

  Notes:

  1. Contribution figures are after abatement.

  2. Administration costs are not fully allocated by member state in the Court of Auditors Report. Allocation of administrative spending would increase gross receipt figures for Belgium and Luxembourg.

  3. Figures for population and households in Germany are for unified Germany for both 1990 and 1994.

  4. Figures for number of households are the latest available and refer to 1990–91.

  Source:

  Court of Auditors Reports and Eurostat.

  Agriculture Contributions (EU)
  Mr. Llew Smith
  To ask the Chancellor of the Exchequer what steps have been taken in respect of the conclusions contained in paragraph 1.125, page 44, of the annual report of the Court of Auditors of the European Communities, in respect of the United Kingdom's provision of information and methods of estimating the agriculture component of gross national product. [2800]

  Mrs. Angela Knight
  In July 1994 the GNP committee discussed a paper by the Commission covering the agriculture component of GNP for all member states. There was a routine request for several member states, including the United Kingdom to supply the Commission with additional information on sources and methods.

  Immediately following the meeting, the Central Statistical Office sent the Commission a copy of an inventory on the sources and methods for agriculture, prepared by the Ministry of Agriculture Fisheries and Food. The Central Statistical Office will continue to respond to any reasonable request for information from the Commission and the GNP committee.

  Fuel Duty
  Mr. Peter Bottomley
  To ask the Chancellor of the Exchequer what representations he has received about the effect on market share and exhaust pollution in Sweden of fuel tax related to the sulphur contents of motor vehicle diesel. [3078]

  Mr. Heathcoat-Amory
  None.

  Mr. Bottomley
  To ask the Chancellor of the Exchequer what are the rates of motor vehicle fuel duty for different types of petrol and for diesel. [3077]

  Mr. Heathcoat-Amory
  The excise duty rates for petrol and diesel road fuel are as follows:

  Leaded petrol: 39.12p per litre

  Unleaded petrol: 34.30p per litre

  Diesel road fuel: 34.30p per litre.

  Mr. Bottomley
  To ask the Chancellor of the Exchequer if he will estimate the differential in fuel duty needed to achieve common retail prices for ordinary diesel and for low sulphur diesel for motor vehicles. [3075]
  700
  Mr. Heathcoat-Amory
  I regret that, because of the wide variation in the pre-tax price of diesel, no meaningful estimate can be made.

  Mr. Bottomley
  To ask the Chancellor of the Exchequer if he will estimate the medium-term change in shares of motor vehicle diesel between ordinary and low sulphur diesel if retail prices were the same. [3076]

  Mr. Heathcoat-Amory
  The Government have no information on which to base such an estimate.

  Inflation
  Mrs. Roche
  To ask the Chancellor of the Exchequer what estimate he has made of overall inflation in 1995–96. [1932]

  Mrs. Angela Knight
  [holding answer 27 November 1995]: The "Financial Statement and Budget Report 1996–97" contains my right hon. and learned Friend the Chancellor's latest forecast for inflation for the years 1995 and 1996.

  World Bank Inspection Panel
  Mr. Worthington
  To ask the Chancellor of the Exchequer if it is his policy to support the continuation of the World bank inspection panel. [2910]

  Mr. Hanley
  I have been asked to reply.

  Yes. We hope the panel will prove a useful addition to the existing systems of control provided through the board of directors and by management and will enhance measures to increase the openness of the bank's operations.

SCOTLAND

  Registered Land
  Mr. Gordon Prentice
  To ask the Secretary of State for Scotland what percentage and acreage of land in Scotland is unregistered. [2393]

  Lord James Douglas-Hamilton
  Title to all land in Scotland is registered in the Land Register for Scotland or recorded in the Register of Sasines.
  701

  Electoral Wards
  Mr. Tom Clarke
  To ask the Secretary of State for Scotland if he will list the new council wards which now contain(a) the 3,865 electors from Strathclyde electoral division 46 (Chryston) included in the East Dumbartonshire council, (b) the 8,099 electors from Strathclyde electoral division 35 (Toryglen/Kingspark) included in the area of South Lanarkshire council, (c) the 320 electors from Strathclyde electoral division 8 (Vale of Leven) included in the area of Argyll and Bute council and (d) the 248 electors from Tayside electoral division 31 (Sidlaw) included in the area of Dundee city council; and, where any of these groups of electors is contained in more than one new council ward, if he will indicate how many of the electors in question are contained in each of those wards. [2105]

  Mr. Kynoch
  The information is as follows:

  (a) East Dumbartonshire electoral ward 26: South Lenzie/Waterside.

  (b) South Lanarkshire:

  Electoral ward 62: Rutherglen West (3,507 electors)

  Electoral ward 64: Bankhead (3,095 electors)

  Electoral ward 65: Spittal/Blairbeth (1,497 electors)

  (c) Argyll and Bute electoral ward 31: Rhu/Garelochhead/Luss

  (d) City of Dundee:

  Electoral ward 13: Menzieshill West (76 electors)

  Electoral ward 16: Pitalpin (19 electors)

  Electoral ward 17: Ardler (2 electors)

  Electoral ward 19: St Mary's West (17 electors)

  Electoral ward 20: Downfield (6 electors)

  Electoral ward 27: Fintry North (14 electors)

  Electoral ward 29: Whitfield North (0 electors)

  Electoral ward 35: Balgillo (38 electors)

  Electoral ward 36: Dalhousie (76 electors).

  Source: GRO (Scotland).

  Arts
  Mr. Galbraith
  To ask the Secretary of State for Scotland what plans he has to increase funding for the arts in Scotland; and if he will make a statement. [2087]

  Lord James Douglas-Hamilton
  My right hon. Friend will make an announcement on his future spending plans shortly.

  Fire Brigades
  Mr. Worthington
  To ask the Secretary of State for Scotland what statutory obligation the fire brigade has to attend flooding, road accidents and other non-fire related incidents. [2680]

  Lord James Douglas-Hamilton
  A fire authority is empowered, under section 3(1)(e) of the Fire Services Act 1947, to employ the fire brigade maintained by it, or to use any equipment so maintained, for purposes other than firefighting purposes. There is no statutory obligation on such an authority to do so.

  Mr. Worthington
  To ask the Secretary of State for Scotland what consideration is given to the activities of the fire brigade that are not related to firefighting or prevention in determining its funding. [2681]
  702
  Lord James Douglas-Hamilton
  The principal determinants of fire service funding are the personnel, fire stations, and equipment required to provide fire cover. Activities not related to firefighting are undertaken largely with those resources, but any additional requirements in relation to these activities are also taken into account by my right hon. Friend.

  Water and Sewerage Authorities
  Sir Hector Monro
  To ask the Secretary of State for Scotland if he will state his proposals for the financing of the new Scottish water and sewerage authorities in 1996–97. [3686]

  Mr. Michael Forsyth
  Water authorities are currently preparing charges schemes for submission to the Customers Council. The financial arrangements that I am announcing today mean that average charges in 1996–97 need increase by no more than 6 per cent. I invite the authorities to be guided accordingly in finalising their charges schemes. It is for each authority to decide upon its own scheme and on the allocation of charges, and of any overall increase in charges among different groups of customers. It is then for the authorities and the Customers Council to consider all aspects of the charges scheme. I become involved only if there remain differences which cannot be resolved.

  Section 83(2) of the Local Government etc (Scotland) Act 1994 empowers me to set a rate of return which the authorities should earn on the value of their net assets. I propose that for each authority this rate of return should be 6.5 per cent. to be earned annually on net assets amounting initially to £336 million in the case of the east authority, £260 million in the case of the north authority, and £404 million in the case of west authority. The necessary order will be laid before Parliament shortly.

  I have also decided that the external financing limits for 1996–97 for the authorities will amount to £274 million. The allocation to each authority will be announced shortly.

  We have already undertaken to provide relief to offset the charge for domestic sewerage which from 1 April next year will be levied direct on customers instead of being a service met from the council tax. I can now announce that we will give the authorities income of £89.7 million to compensate for the charge income they will forgo in 1996–97. Of this, £27.3 million will be available to the east authority, £22.4 million to the north authority and £40 million to the west authority. The necessary order will be laid before Parliament shortly.

  I believe that these arrangements which I have announced will establish the new water and sewerage authorities on a sound financial footing and will enable them from the outset to deliver a first class service at the lowest possible cost.

  Highland Health Board
  Mr. Charles Kennedy
  To ask the Secretary of State for Scotland what was the proportionate value of the computer equipment transferred from Highland health board to the Computing Sciences Corporation Ltd. as part of the privatisation process earlier this year; and if he will make a statement. [308]
  703
  Lord James Douglas-Hamilton
  The proportionate value as at March 1995 of the equipment transferred from Highland health board to the Computing Sciences Corporation Ltd. was 5.5 per cent. of the total market value of the equipment transferred by the NHS in Scotland. This was based on an independent market evaluation.

  Public Bodies
  Mr. Hood
  To ask the Secretary of State for Scotland if he will list the names of individuals who have been appointed to non-departmental public bodies serving and working within Lanarkshire indicating their political party affiliations, if known. [2953]

  Mr. Michael Forsyth
  [holding answer 28 November 1995]: This information is not held centrally and could be obtained only at disproportionate cost. Non-departmental public bodies in Scotland are listed in the annual Cabinet Office publication, "Public Bodies", which includes the addresses of all executive non-departmental public bodies. The hon. Member may wish to approach these bodies direct for the information he seeks. As a general rule, political affiliation is not a criterion for appointment to public bodies and, except where this information is volunteered by the appointee, it is not made a matter for record.

  Mr. Hood
  To ask the Secretary of State for Scotland what is the total expenditure on non-departmental public bodies in Scotland. [2954]

  Mr. Michael Forsyth
  [holding answer 28 November 1995]: In 1993–94, my Department spent £1,567 million on executive and advisory bodies and tribunals. This is the most recent year for which figures are available. It includes total Government funding to these bodies of £1,562 million and direct expenditure by my Department of £5 million. Details of expenditure by non-departmental public bodies is published annually by Cabinet Office in "Public Bodies".

  Orchard House Nursing Home
  Mr. Hood
  To ask the Secretary of State for Scotland if he will request that BBC Frontline Scotland programme to supply him with its videoed evidence of its investigation into Orchard House nursing home. [2957]

  Lord James Douglas-Hamilton
  [holding answer 28 November 1995]: My right hon. Friend understands that, as part of Lanarkshire health board's inquiry into the standards of care at Orchard House nursing home, the investigating officer was allowed by the British Broadcasting Corporation to view its videoed evidence of the Frontline Scotland investigation into Orchard House nursing home. The board's inquiry is now complete and the necessary follow-up action is underway.

  Nursing and Residential Homes
  Mr. Hood
  To ask the Secretary of State for Scotland if he will make it his policy to review legislation to give more powers to local authorities and health boards to enable them to introduce stricter controls on registration of nursing homes and residential homes; and if he will make a statement. [2958]
  704
  Lord James Douglas-Hamilton
  [holding answer 28 November 1995]: A Scottish Office working group, which includes representatives of local authorities, care home owners' associations and users, is currently considering residential home registration and inspection issues, including the current legislative arrangements. National standards for the registration and inspection of nursing homes will be the outcome of a project funded by the health board general managers' group.

  We shall consider all recommendations from these groups, which would help ensure the continued protection of the potentially vulnerable people cared for in these homes.

  Nursing Homes, Lanarkshire
  Mr. Hood
  To ask the Secretary of State for Scotland how many residents have died in Lanarkshire nursing homes in the Lanarkshire health board area in each year since 1979. [2959]

  Lord James Douglas-Hamilton
  [holding answer 28 November 1995]: This information was not held centrally before October 1992. The information requested since then is as follows:

  Year

  Deaths

  1 October to 31 December 1992

  93

  1993

  538

  1994

  589

  1 January to 30 September 1995

  479

  Local Enterprise Companies
  Mr. Donohoe
  To ask the Secretary of State for Scotland (1) what discussions his Department has had with Scottish Enterprise and Highlands and Islands Enterprise in relation to the levels of beneficial interest declared by local enterprise company directors in local enterprise company contracts; [1191]

  (2) what information the directors of local enterprise companies are required to declare in relation to their interests in other enterprise companies; [1320]

  (3) if he will instruct the chief executives of Scottish Enterprise and Highlands and Islands Enterprise to carry out a study of the beneficial interests of local enterprise directors in other local enterprise companies for the purpose of ensuring that this information is publicly accountable; [1192]

  (4) what studies his Department has carried out into the involvement of local enterprise company directors in the contracts awarded by local enterprise companies; [1190]

  (5) what procedures are currently in place to ensure that the beneficial interests of the director of a local enterprise company in the contracts awarded by a different local enterprise company are open to public scrutiny; [1194]

  (6) for what regions information is not currently delivered by directors of local enterprise companies in respect of their interest in other enterprise companies. [2148]
  705
  Mr. Kynoch
  [holding answer 24 November 1995]: The local enterprise company operating contracts approved by the Scottish Office require local enterprise companies to have in place registers of directors' interests that are open to public inspection, procedures for avoiding conflicts of interest, and arrangements for publishing details in their annual reports of contracts in which directors have an interest.

  The detailed procedures within this overall framework are an operational matter for Scottish Enterprise and Highlands and Islands Enterprise, which the Department has discussed with them from time to time. Both the Scottish Enterprise and Highlands and Islands Enterprise networks have adopted procedures which ensure that the private interests of local enterprise company directors are declared and registered, and that directors do not take part in board decisions on matters in which they have an interest. Local enterprise company directors serve on the board of only one local enterprise company, in whose area they must live or work. They play no role in the decisions of any other local enterprise company board, so there is no conflict of interest if another board should take a decision affecting their private beneficial interests.

TRADE AND INDUSTRY

  Japanese Companies
  Dr. Bray
  To ask the President of the Board of Trade if he will list those Japanese firms which currently have research and development teams operating in the United Kingdom. [3162]

  Mr. Eggar
  As of 3 October 1995, my Department's Invest in Britain Bureau was aware of 100 Japanese companies engaged in some form of research, development and/or design—RD and D—in the United Kingdom. A full list of these companies with details of their RD and D activities and their locations within the United Kingdom is being placed in the Library of the House.

  COPEX Exhibition
  Mrs. Clwyd
  To ask the President of the Board of Trade if he will list the representatives of Government Departments who visited the COPEX exhibition at Sandown racecourse in November. [1641]

  Mr. Lang
  The information requested is not held by my Department and could be obtained only at disproportionate cost.

  Telephone Disconnections
  Mr. Harvey
  To ask the President of the Board of Trade what was the number of telephone disconnections in each year of the five years prior to privatisation; and if he will make a statement. [3098]

  Mr. Ian Taylor
  This is a matter for BT. The statistics requested are not currently maintained within the Department, or by Oftel.
  706

  Offshore Installations
  Dr. Godman
  To ask the President of the Board of Trade (1) when he expects to receive the abandonment programme for the North West Hutton platform; and if he will make a statement; [2045]

  (2) if he will list the abandonment programmes for off-shore installations, deposited with his Department in each of the past five years; how many were (a) accepted; (b) rejected and (c) returned to the companies concerned for modification; and if he will make a statement. [2046]

  Mr. Eggar
  Amoco (UK) Exploration Company, the operator of the North West Hutton installation, has been conducting studies since 1992 in connection with the future decommissioning of this installation. The decommissioning date for this installation will depend on a number of factors. I am not yet in a position to say when I will be calling on the owners to submit a programme.

  We have approved the following abandonment programmes for offshore installations in each of the past five years:

  Year

  Facility

  1991

  Crawford

  1992

  Argyll, Duncan and Innes Blair

  1993

  Angus Forbes

  1994

  Fulmar Single Anchor Leg Mooring (SALM) buoy Brent Spar oil storage and tanker loading facility

  1995

  Esmond (2 installations) and Gordon

  Each of these programmes was approved after a series of discussions with my Department and consultation with interested parties. No abandonment programme has been rejected or modified under section 4 of the Petroleum Act 1987.

  Nigerian Trade Fairs
  Mr. Tony Lloyd
  To ask the President of the Board of Trade if he will list the agreed priority sectors from the United Kingdom for Nigerian regional trade fairs in February and March 1996; and who are(a) the bankers and (b) the sponsors of the event. [3109]

  Mr. Oppenheim
  The British high commission is proposing to take a stand at two regional trade fairs in Nigeria in February and March 1996. My Department and the high commission have invited UK companies to exhibit their brochures on the stands. This invitation has been targeted at companies involved in oil and gas, agriculture—agricultural equipment, water and water treatment, food processing, power generation/distribution, medical equipment and pharmaceuticals. There is no UK sponsorship of either trade fair.

  Channel 5
  Mr. Robert McCartney
  To ask the President of the Board of Trade for what reasons the range of the proposed transmissions of Channel 5 within Northern Ireland has been restricted. [3168]
  707
  Mr. Ian Taylor
  The coverage plan for Channel 5 is the responsibility of the Independent Television Commission. Limitations on the range of the transmissions are required to avoid causing interference to other television services, and other radiocommunication services, in Northern Ireland and the Irish Republic.

  Greenbury Report
  Mr. David Nicholson
  To ask the President of the Board of Trade what are his proposals for implementing such recommendations of the Greenbury report as require action or assistance from Her Majesty's Government. [3080]

  Mr. Lang
  I refer my hon. Friend to the answer given to my hon. Friend the Member for Colchester, North (Mr. Jenkin) on 7 November 1995,Official Report, columns 702–4.

  Employment Agency Licensing Division
  Mr. Steen
  To ask the President of the Board of Trade if he will list the annual income of the employment agency licensing division arising from(a) fees, (b) charges and (c) fines; what was the total number of staff employed (i) part time and (ii) full time; and what contribution his Department has made towards the annual running costs in each of the past three years. [2751]

  Mr. Lang
  [holding answer 28 November 1995]: The licensing requirements of the Employment Agencies Act 1973 were abolished on 3 January 1995. Fees for licenses issued under the Act and fines imposed by magistrates courts for offences against the Act were paid to the Consolidated Fund. They could therefore not be set against departmental expenditure.

  Fees paid £million

  Fines imposed £thousands

  1992–93

  1.7

  1.9

  1993–94

  1.7

  3.2

  1994–95

  11.4

  1.1

  1 To 3 January 1995 only.

  708
  Staff employed on administering the 1973 Act in 1992–93 and 1993–94 were 50.5 and 51.5 respectively. During 1994–95 the number fell to 35. The number of part-time staff did not exceed five at any time in the three years.

  Power Cables
  Ms Lynne
  To ask the President of the Board of Trade what consideration he has given to introducing a statutory requirement on electricity companies to pay compensation to householders living beneath power cables where it can be proved that householders have faced(a) a decline in the value of their property and (b) a deterioration in their health. [1962]

  Mr. Eggar
  [holding answer 27 November 1995]: The Government have no plans to introduce such a requirement.

  With regard to item (a), I refer the hon. Member to the answer given to her by my hon. Friend the Under-Secretary of State for the Environment on 27 November 1995, Official Report, column 422.

  With regard to item (b), the National Radiological Protection Board advises the Government on scientific matters relating electromagnetic fields to alleged effects on human health. To date, there is insufficient scientific evidence to establish a link between electromagnetic fields and cancer or leukaemia, the diseases of most concern, or to any other serious illness.

  Foreign Assets
  Mr. Tony Lloyd
  To ask the President of the Board of Trade if his Department has seized or frozen personal accounts and assets of members of foreign Governments; what was seized or frozen; and if he will make a statement. [2918]

  Sir Nicholas Bonsor
  I have been asked to reply.

  I refer the hon. Gentlemen to the answer given to his previous question on 27 November, Official Report, column 429.
  709

EDUCATION AND EMPLOYMENT

  Student Loans
  Mr. Duncan
  To ask the Secretary of State for Education and Employment if she will make a statement on the support that will be available to students through mandatory awards and student loans in the academic year 1996–97. [3499]

  Mr. Forth
  My right hon. and learned Friend the Chancellor of the Exchequer announced on 28 November that the total level of support available to students through the main rates of grant and loan together in 1996–97 will be 2.6 per cent. higher than for 1995–96, in line with forecast price increases. I am placing a memorandum in the Library giving full details of the new grant and fee rates for 1996–97. These rates will be incorporated in the Education (Student Loans) Regulations to be laid before Parliament in due course.

  Assisted Places Scheme
  Mr. Harry Greenway
  To ask the Secretary of State for Education and Employment what detailed arrangements she proposes for expanding the assisted places scheme. [3500]

  Mrs. Gillian Shephard
  My right hon. Friend the Prime Minister announced on 13 October that the assisted places scheme is to be doubled in size. I am today announcing the plans for implementation in England. My right hon. Friends the Secretaries of State for Wales and Scotland will make statements about the arrangements for their schemes.

  The pace of this expansion over time will depend on the supply of eligible high-quality places and on parental demand. This Department is inviting bids from independent schools—whether they are already participating in the scheme or not—for the first instalment of new places in September 1996. We look forward to receiving bids for:

  (a) new day places mainly for entry at age 11, but also at age 13 and for the sixth form, in mainstream independent secondary schools;

  (b) some new day places for children below age 11 in integral junior departments of independent secondary schools;

  (c) some new aided places in specialist schools of music or ballet for talented pupils.

  To be eligible, schools must provide a broad-balanced curriculum, have an excellent record of GCSE and A-level performance and maintain a strong sixth form. I will also be seeking an equitable distribution between boys and girls, and will especially welcome bids from schools serving inner-city areas.

  The scheme will continue to be aimed at able children from low-income families who would not otherwise have had the opportunity of the education offered in these schools. Schools will continue to select pupils according to their own academic entry criteria and the general eligibility conditions prescribed in the regulations. I will encourage them to give priority to those with potential to benefit from the distinctive facilities the school offers, including where appropriate pupils from inner-city areas and the ethnic minority communities.
  710
  I intend to continue the present broad framework of means-tested parental contributions towards approved fees. The arrangements for means testing and fee setting are reviewed annually for the purpose of the regulations, and I will consider any representations on these matters for the reviews in 1996 and subsequent years.

  I aim to announce the successful bidders for the first instalment of new places early in 1996, and to ensure that parents are fully aware of the new opportunities open to them. I am confident that they will widely welcome the expansion of choice, diversity and excellence which this initiative offers.

  Doncaster and Mexborough Jobcentre
  Mr. Redmond
  To ask the Secretary of State for Education and Employment for what reason the reply in respect of jobcentres in Doncaster and Mexborough, from her chief executive of the Employment Service referred to in her answer of 23 October, was not published in the Official Report as well; and if she will make a statement. [1103]

  Mr. Forth
  I regret the fact that, due to an administrative error in the Department, the reply was not published in the Official Report. A copy of the chief executive's reply to the hon. Member has now been placed in the Library.

  Expenditure, Calderdale
  Sir Donald Thompson
  To ask the Secretary of State for Education and Employment what proportion of Calderdale's(a) total and (b) secondary education sector is grant maintained; and what proportion of total public expenditure on education in Calderdale is in the grant-maintained sector. [1467]

  Mr. Robin Squire
  According to the local education authority's expenditure return for 1993–94, the latest year for which figures are available, the proportion of local authority net recurrent expenditure, which was allocated as recurrent funding to grant-maintained schools in Calderdale was 11 per cent. NRE is gross expenditure on schools, continuing education and management and support services related to education, minus income other than that in the form of specific grants and excluding capital. The percentage figures also includes special purpose grants paid to grant-maintained schools by the Funding Agency for Schools.

  The proportion of pupils in grant-maintained schools as at January 1994 in Calderdale was (a) 15 per cent. of the total and (b) 35 per cent. of the secondary sector. At January 1995 the proportions were (a) 26 per cent. and (b) 56 per cent.

  Written Answers
  Mr. Thurnham
  To ask the Secretary of State For Education and Employment how many written questions her Department has failed to answer since it was established; and if she will give an explanation for each such failure, listing the question and any answer now available. [2248]

  Mr. Robin Squire
  The matter is currently being investigated and I will write to the hon. Member when this is complete.
  711

  Youth Training
  Mr. Hall
  To ask the Secretary of State for Education and Employment how many YT trainees(a) have gained full employment (b) have gone on to further training and

  Percentage of leavers gaining each outcome Youth Training (including Youth Credits)

  England and Wales

  In full-time employment

  In part-time employment

  In self-employment

  Full-time education or another training programme

  Unemployed

  1987–88

  57

  4

  1

  16

  20

  1988–89

  63

  4

  2

  15

  13

  1989–90

  63

  4

  2

  14

  14

  1990–91

  53

  4

  1

  16

  20

  1991–92

  46

  4

  1

  16

  25

  1992–93

  44

  5

  1

  17

  28

  1993–94

  47

  5

  1

  17

  25

  April 1994-January 1995

  50

  5

  1

  15

  22

  Source:

  YT National Follow-up Survey.

  The YT National Follow-up Survey records 8 separate labour market outcomes plus "not stated". These are; full-time job with same employer, full-time job with different employer, self-employment, part-time job, unemployed, another government training programme, full-time education and something else as stipulated by the trainee.

  Sheffield TEC
  Sir Irvine Patnick
  To ask the Secretary of State for Education and Employment (1) what negotiations have taken place between her Department and Sheffield TEC to make provision for employment for the over-45 year age group; and if she will make a statement; [2520]

  (2) what initiatives her Department is undertaking to make provision for the employment for the over-45 age group in the Sheffield travel-to-work area; and if she will make a statement. [2517]

  Mr. Paice
  The Department continues to provide a wide range of employment and training measures in the Sheffield area to help unemployed people find a job and employed people to enhance their skill and knowledge levels. It also has a campaign for older workers targeted at employers who impose age restrictions to persuade them of the need to recruit, retain and retrain individuals on the basis of ability and not age.

  In addition, the Department has contracted with Sheffield TEC to provide during this financial year training, education and enterprise courses amounting to 4,350 adult places; many of which will be filled by those in the over-45 group.

  It is these measures and programmes as part of the Government's policy of maintaining the economic conditions of low inflation and a fully competitive and flexible labour market which continues to maintain existing jobs and creates new employment opportunities for all large groups including the over-45s.

  Over the last two years, in the Sheffield travel-to-work area, unemployment in the 45-and-over age group has fallen by almost 17 per cent., and long-term unemployment in the same group by almost 11 per cent.
  712
  (c) became unemployed at the end of their training in each year since the scheme began. [2315]

  Mr. Paice
  The information requested is given in the table:

  Child Care Expenses
  Mrs. Bridget Prentice
  To ask the Secretary of State for Education and Employment if she will introduce guidelines governing the payment of child care expenses by governing bodies to school governors attending meetings. [2737]

  Mr. Robin Squire
  No. Being a school governor is a voluntary, unpaid activity. The Government applaud the 300,000 volunteers who give their time and energy to this important work. Governors may receive reimbursement for travel and subsistence costs, but the law does not currently allow payments beyond that, nor does the current pattern of governor recruitment suggest a need to change these arrangements.

  National Vocational Qualifications
  Sir Irvine Patnick
  To ask the Secretary of State for Education and Employment what is the average cost of obtaining an NVQ; and how many of these have been obtained in Sheffield. [2519]

  Mr. Paice
  Research carried out by KPMG Management Consultants in 1994 found that, among the 60 firms studied, the median cost to an employer for one member of staff obtaining a national vocational qualification was £200 on direct outlays, such as NVQ registration and certification fees. In addition, staff time was spent on training, assessment and other activities related to achieving an NVQ, and for the typical employer in that survey this amounted to around £3,000.

  More than 2 million NVQs have been awarded since their launch. Information on the numbers awarded on the Sheffield area is not available
  713

  Oxford University (Admissions)
  Mr. Walden
  To ask the Secretary of State for Education and Employment what percentage of pupils from state schools gained admission to Oxford university in(a) 1969, (b) 1979 and (c) 1994. [2892]

  Mr. Forth
  Detailed information on admissions to individual universities is not collected centrally. It is for each university to decide its own criteria for the admission of students. I understand that the admissions office of Oxford university produces annual statistics along these lines and my hon. Friend might care to speak to it directly.

  Name of school

  LEA of school

  Ballot initiated by

  Ballot closed

  GM proposal published

  Secretary of State decision

  Implementation of GM status

  North Somercotes CE Primary School

  Lincolnshire

  G

  24/02/93

  04/03/93

  07/07/94

  01/09/94

  Totley All Saints' CE Junior and Infant School

  Sheffield

  G

  10/03/93

  05/04/93

  01/03/94

  01/09/94

  Dr. John Bingham Primary School

  Sheffield

  P

  31/03/93

  23/07/93

  11/02/94

  01/09/94

  Barkston and Syston CE (GM) Primary School

  Lincolnshire

  G

  02/06/93

  08/11/93

  24/03/94

  01/09/94

  Cheltenham Kingsmead School

  Gloucestershire

  G

  03/06/93

  18/10/93

  14/03/94

  01/09/94

  The Barr Beacon School

  Walsall

  G

  07/06/93

  24/09/93

  18/07/94

  01/09/94

  The Corbett CE GM Primary School

  Staffordshire

  G

  30/07/93

  14/01/94

  27/06/94

  01/09/94

  Little Reddings Primary School

  Hertfordshire

  G

  30/07/93

  20/10/93

  10/03/94

  01/09/94

  Broomhill Infant School

  Sheffield

  P

  02/08/93

  13/09/93

  11/02/94

  01/09/94

  The John Warner Grant Maintained School

  Hertfordshire

  G

  15/10/93

  31/03/94

  15/08/94

  01/09/94

  Wincheap Primary School

  Kent

  G

  15/10/93

  24/02/94

  26/05/94

  01/09/94

  St. Mary's High School

  Hertfordshire

  G

  25/10/93

  28/01/94

  17/06/94

  01/09/94

  Tadworth Primary School

  Surrey

  G

  01/11/93

  14/01/94

  16/05/94

  01/09/94

  Hayes Primary School

  Bromley

  G

  12/11/93

  31/12/93

  09/07/94

  01/09/94

  Highfield Infant School

  Bromley

  G

  19/11/93

  31/01/94

  04/05/94

  01/09/94

  Highfield Junior School

  Bromley

  G

  19/11/93

  31/01/94

  04/05/94

  01/09/94

  Shirley High School

  Croydon

  G

  22/11/93

  29/11/93

  16/03/94

  01/09/94

  Charlton Horethorne CE Primary School

  Somerset

  G

  26/11/93

  10/12/93

  26/07/94

  01/09/94

  Atwood Primary School

  Croydon

  G

  01/12/93

  31/01/94

  06/05/94

  01/09/94

  Wilmington Primary School

  Kent

  G

  03/12/93

  19/01/94

  11/05/94

  01/09/94

  Chatham House Grammar School

  Kent

  G

  03/12/93

  30/03/94

  03/08/94

  01/09/94

  Boston Grammar School

  Lincolnshire

  G

  03/12/93

  06/01/94

  16/05/94

  01/09/94

  Castle Primary School, Ludgershall

  Wiltshire

  G

  03/12/93

  04/03/94

  13/07/94

  01/09/94

  Westgate Junior School

  Lincolnshire

  G

  07/12/93

  25/01/94

  06/05/94

  01/09/94

  Brymore School

  Somerset

  G

  07/12/93

  28/01/94

  21/07/94

  01/09/94

  Loddon First School

  Norfolk

  G

  13/12/93

  31/01/94

  19/06/94

  01/09/94

  Sutton Benger CE Primary School

  Wiltshire

  G

  17/12/93

  17/01/94

  14/04/94

  01/09/94

  Hollingwood First School

  Bradford

  G

  17/12/93

  11/02/94

  06/05/94

  01/09/94

  The Curzon CE Primary School

  Derbyshire

  G

  20/12/93

  04/02/94

  21/07/94

  01/09/94

  Salesbury CE Primary School

  Lancashire

  G

  20/12/93

  31/12/93

  15/05/94

  01/09/94

  Heathfield High School

  Sandwell

  G

  20/12/93

  26/01/94

  26/05/94

  01/09/94

  Ashton CE Middle School

  Bedfordshire

  G

  20/12/93

  20/04/94

  11/08/94

  01/09/94

  The Archbishop Lanfranc School

  Croydon

  G

  21/12/93

  28/01/94

  12/05/94

  01/09/94

  Hill Top CE First School

  Bradford

  G

  22/12/93

  11/01/94

  20/04/94

  01/09/94

  Fir Ends School

  Cumbria

  G

  07/01/94

  22/04/94

  29/07/94

  01/09/94

  Durand Primary School

  Lambeth

  G

  19/01/94

  04/05/94

  11/08/94

  01/09/94

  Halfway Houses Primary School

  Kent

  G

  19/01/94

  03/02/94

  16/05/94

  01/09/94

  Brookmans Park School

  Hertfordshire

  G

  25/01/94

  27/01/94

  01/07/94

  01/09/94

  Chestnut School Grant Maintained

  Hertfordshire

  G

  25/01/94

  11/02/94

  01/07/94

  01/09/94

  The Grange Junior School

  Shropshire

  G

  25/01/94

  29/04/94

  19/07/94

  01/09/94

  St. Catherine of Sienna School

  Hertfordshire

  G

  26/01/94

  25/03/94

  19/08/94

  01/09/94

  Loudwater Combined School

  Buckinghamshire

  G

  26/01/94

  04/03/94

  27/06/94

  01/09/94

  Greenacres Primary School

  Shropshire

  G

  31/01/94

  14/05/94

  10/08/94

  01/09/94

  Greatstone Primary School

  Kent

  G

  31/01/94

  03/02/94

  10/05/94

  01/09/94

  Glebe Infants School

  Gloucestershire

  P

  31/01/94

  28/02/94

  20/05/94

  01/09/94

  Greenway Junior School

  West Sussex

  G

  31/01/94

  17/02/944

  06/07/94

  01/09/94

  St. David's School (Grant Maintained)

  Gloucestershire

  G

  31/01/94

  31/03/94

  06/07/94

  01/09/94

  Holy Trinity CE School

  Wiltshire

  G

  01/02/94

  09/03/94

  29/06/94

  01/09/94

  St. Joseph's RC Primary School

  Wiltshire

  G

  02/02/94

  03/02/94

  30/06/94

  01/09/94

  St. Joseph's RC Primary School

  Kent

  G

  07/02/94

  31/03/94

  28/07/94

  01/09/94

  Swindon Village Primary School

  Gloucestershire

  G

  07/02/94

  28/03/94

  08/07/94

  01/09/94

  Dersingham First School

  Norfolk

  G

  14/02/94

  08/03/94

  20/07/94

  01/09/94

  Cam Woodfield Junior School

  Gloucestershire

  G

  14/02/94

  16/03/94

  28/06/94

  01/09/94

  Reay Primary School

  Lambeth

  G

  16/02/94

  15/03/94

  08/07/94

  01/09/94

  Preston Manor High School

  Brent

  G

  16/02/94

  05/05/94

  30/08/94

  01/09/94

  Immanuel and St. Andrew CE Primary School

  Lambeth

  G

  16/02/94

  15/03/94

  29/06/94

  01/06/94

  Lincoln School of Science and Technology

  Lincolnshire

  G

  23/02/94

  28/03/94

  21/07/94

  01/09/94

  Myrtle Park First School

  Bradford

  G

  28/02/94

  25/03/94

  01/07/94

  01/09/94

  Whyteleafe School

  Surrey

  G

  28/02/94

  10/03/94

  03/06/94

  01/09/94

  Prospect School

  Berkshire

  G

  04/03/94

  18/03/94

  04/08/94

  01/09/94

  Earls Colne Primary School

  Essex

  G

  07/03/94

  29/04/94

  21/07/94

  01/09/94

  714

  Grant-maintained Schools
  Mr. Blunkett
  To ask the Secretary of State for Education and Employment what was the date of(a) the close of the ballot, (b) publication of proposals and (c) the Secretary of State's decision in respect of each school which has become grant-maintained since 31 August 1994; and whether the ballot was initiated by the governors' resolution or parents' petition. [2893]

  Mr. Robin Squire
  The information requested is set out in the table:
  715

  Name of school

  LEA of school

  Ballot initiated by

  Ballot closed

  GM proposal published

  Secretary of State decision

  Implementation of GM status

  Flimby Primary School

  Cumbria

  G

  09/03/94

  06/05/94

  19/08/94

  01/09/94

  Healey Primary School

  Rochdale

  G

  14/03/94

  18/03/94

  29/06/94

  01/09/94

  Wallace Fields Junior School

  Surrey

  G

  14/03/94

  21/04/94

  16/08/94

  01/09/94

  Wicklewood Primary School

  Norfolk

  G

  18/03/94

  27/04/94

  10/08/94

  01/09/94

  High Faringdon School

  Berkshire

  G

  21/03/93

  22/04/94

  26/08/94

  01/09/94

  Oakworth First School

  Bradford

  G

  24/03/94

  14/04/94

  25/07/94

  01/109/94

  Fullbrook School

  Surrey

  G

  25/03/94

  20/04/94

  15/08/94

  01/09/94

  Christ Church Primary School

  Gloucestershire

  G

  25/03/94

  27/04/94

  01/08/94

  01/09/94

  Woodlands Community School

  Derbyshire

  G

  28/03/94

  18/04/94

  22/08/94

  01/09/94

  St. John Houghton RC School

  Derbyshire

  G

  05/04/94

  27/04/94

  31/08/94

  01/09/94

  Hollingworth High School

  Rochdale

  G

  06/04/94

  16/04/94

  22/07/94

  01/09/94

  Thrapston Primary School

  Northamptonshire

  G

  11/04/94

  15/04/94

  22/08/94

  01/09/94

  Fair Meadows Primary School

  Derbyshire

  G

  11/04/94

  15/04/94

  22/08/94

  01/09/94

  Two Mile Ash Middle School

  Buckinghamshire

  G

  26/04/94

  10/05/94

  25/08/94

  01/09/94

  Severnbanks Primary School

  Gloucestershire

  G

  02/05/94

  09/05/94

  28/07/94

  01/09/94

  The Winston Churchill School

  Surrey

  G

  13/05/94

  01/06/94

  25/08/94

  01/09/94

  Beaconside CE Infant School

  Cumbria

  G

  24/05/94

  28/05/94

  07/11/94

  01/12/94

  Beaconside CE Junior School

  Cumbria

  G

  24/05/94

  28/05/94

  08/11/94

  01/12/94

  Barmby Moor CE Primary School

  Humberside

  P

  02/06/93

  01/02/94

  11/10/94

  01/01/95

  Mount Street Infant School

  Lincolnshire

  G

  31/01/94

  14/05/94

  30/11/94

  01/01/95

  Nun Monkton GM School

  North Yorkshire

  P

  11/02/94

  18/02/94

  08/12/94

  01/01/95

  Pott Shrigley Church School

  Cheshire

  P

  22/02/94

  17/06/94

  21/11/94

  01/01/95

  St. Hilda's CE High School

  Liverpool

  G

  25/02/94

  25/05/94

  06/09/94

  01/01/95

  Petersfield School

  Hampshire

  G

  07/03/94

  25/05/94

  22/09/94

  01/01/95

  The Turnpike School

  Berkshire

  G

  09/03/94

  28/03/94

  18/10/94

  01/01/95

  Sir William Romney's Community School

  Gloucestershire

  G

  14/03/94

  11/07/94

  02/12/94

  01/01/95

  Ursuline Convent High School

  Merton

  G

  21/03/94

  22/04/94

  05/10/94

  01/01/95

  Sandwich High School

  Kent

  G

  22/03/94

  30/06/94

  02/11/94

  01/01/95

  Halifax Catholic High School

  Calderdale

  G

  29/03/94

  14/06/94

  08/12/94

  01/01/95

  Lightcliffe CE Junior and Infants School

  Calderdale

  G

  05/04/94

  08/07/94

  28/11/94

  01/01/95

  Ruskington Chestnut Street CE Primary School

  Lincolnshire

  G

  18/04/94

  25/05/94

  17/10/94

  01/01/95

  Castle Carrock Primary School

  Cumbria

  G

  29/04/94

  15/07/94

  01/11/94

  01/01/95

  Stanion CE Primary School

  Northamptonshire

  G

  02/05/94

  30/05/94

  03/11/94

  01/01/95

  Bamford Primary School

  Rochdale

  G

  03/05/94

  28/05/94

  01/09/94

  01/01/95

  Surrey Square Infant and Junior School

  Southwark

  G

  16/05/94

  08/07/94

  24/10/94

  01/01/95

  Toftwood First School

  Norfolk

  G

  02/06/94

  23/06/94

  27/10/94

  01/01/95

  West Vale Junior and Infants School

  Calderdale

  G

  10/06/94

  08/07/94

  16/11/94

  01/01/95

  Burpham Primary School

  Surrey

  G

  13/06/94

  12/08/94

  19/12/94

  01/01/95

  Milton Hall GM Primary School

  Essex

  G

  15/06/94

  22/06/94

  23/12/94

  01/01/95

  Docking Primary School GM

  Norfolk

  G

  27/06/94

  15/07/94

  04/11/94

  01/01/95

  Moat Junior School

  Gloucestershire

  P

  01/07/94

  12/09/94

  15/12/94

  01/01/95

  Hinchley Wood School

  Surrey

  G

  30/06/93

  01/10/93

  09/03/95

  01/04/95

  Minchinhampton School

  Gloucestershire

  G

  16/02/94

  25/05/94

  03/11/94

  01/04/95

  Haselor School

  Warwickshire

  P

  14/03/94

  18/04/94

  09/11/94

  01/04/95

  The Central School

  Lincolnshire

  G

  05/04/94

  23/12/94

  29/03/95

  01/04/95

  St. Joseph's RC Primary School

  Brent

  G

  27/04/94

  17/11/94

  16/03/95

  01/04/95

  Holmshill School

  Hertfordshire

  G

  31/05/94

  15/07/94

  30/01/95

  01/04/95

  Heron Primary School

  Gloucestershire

  G

  13/06/94

  10/10/94

  09/02/95

  01/04/95

  Pippins First School

  Berkshire

  G

  15/06/94

  01/09/94

  27/03/95

  01/04/95

  Caister High School

  Norfolk

  G

  01/07/94

  21/10/94

  23/02/95

  01/04/95

  Mill Hill School

  Derbyshire

  G

  26/10/94

  04/11/94

  28/02/95

  01/04/95

  Shelton Junior School

  Derbyshire

  G

  31/10/94

  20/12/94

  27/03/95

  01/04/95

  Langley Park School for Girls

  Bromley

  G

  04/11/94

  30/11/94

  15/02/95

  01/04/95

  Stalbridge GM Primary School

  Dorset

  G

  21/11/94

  24/11/94

  28/03/95

  01/04/95

  Keelham First School

  Bradford

  G

  23/11/94

  20/12/94

  29/03/95

  01/04/95

  The Ravensbourne School

  Bromley

  G

  29/11/94

  19/12/94

  16/03/95

  01/04/95

  The Hayfield School

  Doncaster

  G

  30/11/94

  22/12/94

  29/03/95

  01/04/95

  Crosby on Eden CE Primary School

  Cumbria

  G

  02/12/94

  23/12/94

  29/03/95

  01/04/95

  Pitton Primary School

  Wiltshire

  G

  22/11/94

  11/01/95

  18/05/95

  01/06/95

  St. Kentigerns RC Primary School

  Manchester

  G

  06/12/94

  07/12/94

  23/05/95

  01/06/95

  Brookfield Junior School

  Kent

  P

  12/12/94

  20/01/95

  01/06/95

  01/07/95

  Keswick School

  Cumbria

  G

  10/03/95

  14/03/95

  28/06/95

  01/07/95

  Bestwood Community School

  Nottinghamshire

  G

  23/03/94

  15/04/94

  28/04/95

  01/09/95

  Clarendon Infants School

  Wiltshire

  G

  23/03/94

  14/06/94

  07/07/95

  01/09/95

  Clarendon Junior School

  Wiltshire

  G

  23/03/94

  14/06/94

  07/07/95

  01/09/95

  Dunchurch First School

  Warwickshire

  P

  29/03/94

  13/05/94

  08/08/95

  01/09/95

  Dunnington CE Primary School

  Warwickshire

  P

  30/03/94

  15/04/94

  18/07/95

  01/09/95

  Middlemarsh Middle School

  Warwickshire

  P

  26/04/94

  08/06/94

  07/07/95

  01/09/95

  Wolverton Primary School

  Warwickshire

  P

  24/08/94

  25/11/95

  07/07/95

  01/09/95

  Longridge GM Primary School

  Lancashire

  G

  22/11/94

  19/12/94

  15/08/95

  01/09/95

  Pennine Way Junior School (G.M.)

  Derbyshire

  G

  09/12/94

  27/02/95

  04/08/95

  01/09/95

  Longtown Junior School

  Cumbria

  G

  27/12/94

  06/02/95

  02/05/95

  01/09/95

  William Hildyard C of E Primary School

  Lincolnshire

  G

  28/12/94

  14/01/95

  16/06/95

  01/09/95

  Engaines Primary School

  Essex

  G

  11/01/95

  15/02/95

  21/06/95

  01/09/95

  Zouch Primary School

  Wiltshire

  G

  18/01/95

  24/02/95

  23/06/95

  01/09/95

  Rochford Primary School

  Essex

  G

  01/03/95

  20/04/95

  24/08/95

  01/09/95

  Harcourt Primary School

  Kent

  G

  06/03/95

  30/03/95

  18/08/95

  01/09/95

  716

  717

  Name of school

  LEA of school

  Ballot initiated by

  Ballot closed

  GM proposal published

  Secretary of State decision

  Implementation of GM status

  All Souls' CE Primary School

  Kent

  G

  06/03/95

  16/03/95

  21/06/95

  01/09/95

  Gravesend Grammar School for Boys

  Kent

  G

  31/03/95

  07/04/95

  11/08/95

  01/09/95

  St. Mary's R C Primary School

  Lambeth

  G

  03/04/95

  07/04/95

  20/07/95

  01/09/95

  Castledown Comprehensive School

  Wiltshire

  G

  07/04/95

  09/06/95

  15/08/95

  01/09/95

  Carrant Brook Junior School

  Gloucestershire

  G

  07/04/95

  16/05/95

  02/08/95

  01/09/95

  Kilburn Park Junior School

  Brent

  G

  16/05/95

  22/05/95

  31/08/95

  01/09/95

  Enmore CE GM Primary School

  Somerset

  G

  13/03/95

  21/03/95

  28/09/95

  01/10/95

  King David Primary School

  Liverpool

  G

  13/06/94

  30/09/94

  09/10/95

  01/11/95

  St. Mary's RC Primary School

  Wiltshire

  G

  08/07/94

  11/11/94

  15/08/95

  01/11/95

  Note:

  In the 'ballot initiated by' column 'P' = Parents and 'G' Governors.

  Mr. Blunkett
  To ask the Secretary of State for Education and Employment if she will list the grant-maintained schools which have applied for loans under section 92 of the Education Act 1993, in each case stating(a) the size of loan requested, (b) the purpose for which the loan was agree, (c) the size of the loan agreed, (d) the period of repayment and (e) the interest rate applied. [2895]

  Mr. Robin Squire
  These matters are now the responsibility of the Funding Agency for Schools. I have asked its chairman to write to the hon. Member with this information.

  Mr. Blunkett
  To ask the Secretary of State for Education and Employment if she will list the grant-maintained schools which have applied for special purpose grant (restructuring), in each case stating(a) the number of (i) teaching and (ii) non-teaching posts affected, (b) the posts for which grant was awarded and (c) if (i) premature retirement compensation or (ii) statutory redundancy payment was awarded. [2897]

  Mr. Squire
  These matters are now the responsibility of the Funding Agency for Schools. I have asked its chairman to write to the hon. Member with this information.

  Pupil Achievements
  Mrs. Anne Campbell
  To ask the Secretary of State for Education and Employment what percentage of(a) primary and (b) secondary school children perform two or more years below their chronological age in (i) English and (ii) maths. [2992]

  Mr. Robin Squire
  This information is not collected by the Department. The table shows for 1994 the proportion of pupils in England at the end of key stages 1 and 3 reaching the expected national curriculum level of their age group. Figures for 1995, which for the first time will show the results of pupils at the end of key stages 1, 2 and 3, should be available in the new year, and will be placed in the Library.

  Primary

  Secondary

  Total schools1

  LEA area

  Schools2

  schools balloted on GM status

  Per cent. Of schools held GM ballots

  Schools voted 'yes'

  Per cent. Of schools voted 'yes'

  Schools2

  schools balloted on GM status

  Per cent. Of schools held GM ballots

  Schools voted 'yes'

  Per cent. Of schools voted 'yes'

  Schools

  Schools balloted on GM status

  Per cent. Of schools held GM ballots

  Schools voted 'yes'

  Per cent. Of schools voted 'yes'

  Corporation of London

  1

  0

  0

  0

  0

  0

  0

  0

  0

  0

  1

  0

  0

  0

  0

  Camden

  41

  0

  0

  0

  0

  11

  3

  27

  2

  18

  60

  4

  7

  2

  3

  718

  Percentage of pupils at the end of key stage 1 reaching or exceeding level 2

  Teacher assessment

  Test

  Reading

  80

  80

  Writing

  70

  67

  Spelling

  73

  71

  Handwriting

  81

  80

  Mathematics

  81

  81

  Based on a response rate from schools of about 52 per cent.

  Percentage of pupils at the end of key stage 3 reaching or exceeding level 5

  Teacher assessment

  Test

  English

  63

  58

  Mathematics

  65

  60

  Based on a response rate from schools of about 22 per cent.

  Departmental Targets
  Ms Armstrong
  To ask the Secretary of State for Education and Employment what is the published recommended response times within which her Department is expected to reply to letters from the public. [2998]

  Mr. Paice
  The Department aims to respond to all letters from members of the public within 20 working days, which is the target set in the code of practice on access to Government information.

  Opting-out
  Mr. Don Foster
  To ask the Secretary of State for Education and Employment how many(a) schools, (b) primary schools and (c) secondary schools there are in England and Wales and in each county; how many schools have (i) held ballots to decide whether or not to opt out of local authority control and (ii) decided to opt out of local education authority control; and what are (i) and (ii) as a percentage of (a), (b) and (c) for each county and for England and Wales. [640]

  Mr. Robin Squire
  Information in respect of maintained schools in all local education authorities in England is set out in the table. Information for Wales is a matter for my right hon. Friend the Secretary of State for Wales.
  719

  Primary

  Secondary

  Total schools1

  LEA area

  Schools2

  schools balloted on GM status

  Per cent. Of schools held GM ballots

  Schools voted 'yes'

  Per cent. Of schools voted 'yes'

  Schools2

  schools balloted on GM status

  Per cent. Of schools held GM ballots

  Schools voted 'yes'

  Per cent. Of schools voted 'yes'

  Schools

  Schools balloted on GM status

  Per cent. Of schools held GM ballots

  Schools voted 'yes'

  Per cent. Of schools voted 'yes'

  Greenwich

  75

  1

  1

  1

  1

  15

  1

  7

  0

  0

  98

  2

  2

  2

  2

  Hackney

  62

  1

  2

  1

  2

  10

  1

  10

  0

  0

  78

  2

  3

  1

  1

  Hammersmith and Fulham

  37

  2

  5

  1

  3

  9

  1

  11

  1

  11

  52

  3

  6

  2

  4

  Islington

  57

  0

  0

  9

  0

  9

  0

  0

  0

  0

  71

  0

  0

  0

  0

  Kensington and Chelsea

  27

  2

  7

  2

  7

  4

  1

  25

  1

  25

  33

  3

  9

  3

  9

  Lambeth

  77

  10

  13

  9

  12

  11

  6

  55

  6

  55

  103

  17

  17

  16

  16

  Lewisham

  70

  1

  1

  1

  1

  13

  2

  15

  0

  0

  90

  3

  3

  1

  1

  Southwark

  73

  7

  10

  6

  8

  13

  4

  31

  4

  31

  96

  11

  11

  10

  10

  Tower Hamlets

  75

  0

  0

  0

  0

  15

  2

  13

  1

  7

  97

  2

  2

  1

  1

  Wandsworth

  60

  5

  8

  3

  5

  9

  8

  89

  7

  78

  80

  13

  16

  10

  13

  Westminster

  41

  0

  0

  0

  0

  8

  1

  13

  0

  0

  52

  1

  2

  0

  0

  Barking and Dagenham

  55

  0

  0

  0

  0

  8

  0

  0

  0

  0

  66

  0

  0

  0

  0

  Barnet

  89

  6

  7

  2

  2

  21

  11

  52

  10

  48

  114

  17

  15

  12

  11

  Bexley

  64

  4

  6

  3

  5

  16

  7

  44

  5

  31

  84

  11

  13

  8

  10

  Brent

  60

  7

  12

  7

  12

  13

  12

  92

  12

  92

  78

  19

  24

  19

  24

  Bromley

  78

  7

  9

  6

  8

  17

  18

  106

  17

  100

  100

  26

  26

  24

  24

  Croydon

  98

  5

  5

  3

  3

  20

  9

  45

  9

  45

  124

  14

  11

  12

  10

  Ealing

  66

  4

  6

  4

  6

  12

  8

  67

  6

  50

  85

  12

  14

  10

  12

  Enfield

  67

  4

  6

  1

  1

  16

  6

  38

  5

  31

  88

  10

  11

  6

  7

  Haringey

  76

  0

  0

  0

  0

  9

  0

  0

  0

  0

  90

  0

  0

  0

  0

  Harrow

  54

  0

  0

  0

  0

  10

  1

  10

  1

  10

  68

  1

  1

  1

  1

  Havering

  71

  3

  4

  0

  0

  18

  4

  22

  4

  22

  92

  7

  8

  4

  4

  Hillingdon

  71

  10

  14

  10

  14

  15

  12

  80

  14

  93

  94

  22

  23

  24

  26

  Hounslow

  62

  0

  0

  0

  0

  14

  2

  14

  2

  14

  81

  2

  2

  2

  2

  Kingston

  36

  1

  3

  1

  3

  10

  4

  40

  4

  40

  49

  5

  10

  5

  10

  Merton

  49

  1

  2

  0

  0

  11

  1

  9

  1

  9

  64

  2

  3

  1

  2

  Newham

  66

  0

  0

  0

  0

  14

  1

  7

  1

  7

  85

  1

  1

  1

  1

  Redbridge

  54

  0

  0

  0

  0

  15

  1

  7

  1

  7

  74

  1

  1

  1

  1

  Richmond

  39

  0

  0

  0

  0

  8

  0

  0

  0

  0

  50

  0

  0

  0

  0

  Sutton

  43

  6

  14

  3

  7

  14

  8

  57

  8

  57

  60

  14

  23

  11

  18

  Waltham Forest

  62

  2

  3

  1

  2

  16

  2

  13

  2

  13

  84

  5

  6

  4

  5

  Birmingham

  332

  10

  3

  5

  2

  79

  24

  30

  17

  22

  444

  34

  8

  22

  5

  Coventry

  89

  1

  1

  0

  0

  19

  0

  0

  0

  0

  119

  1

  1

  0

  0

  Dudley

  83

  1

  1

  1

  1

  22

  9

  41

  7

  32

  112

  10

  9

  8

  7

  Sand well

  112

  0

  0

  0

  0

  20

  4

  20

  2

  10

  143

  4

  3

  2

  1

  Solihull

  70

  1

  1

  1

  1

  13

  2

  15

  1

  8

  87

  3

  3

  2

  2

  Walsall

  103

  3

  3

  2

  2

  20

  9

  45

  7

  35

  131

  12

  9

  9

  7

  Wolverhampton

  98

  2

  2

  0

  0

  20

  7

  35

  5

  25

  124

  9

  7

  5

  4

  Knowsley

  64

  0

  0

  0

  0

  11

  3

  27

  1

  9

  83

  3

  4

  1

  1

  Liverpool

  174

  2

  1

  1

  1

  35

  9

  26

  4

  11

  231

  11

  5

  5

  2

  St. Helens

  66

  1

  2

  1

  2

  12

  1

  8

  0

  0

  83

  2

  2

  1

  1

  Sefton

  93

  0

  0

  0

  0

  22

  2

  9

  0

  0

  121

  2

  2

  0

  0

  Wirral

  106

  0

  0

  0

  0

  21

  4

  19

  2

  10

  139

  4

  3

  2

  1

  Bolton

  105

  3

  3

  1

  1

  16

  3

  19

  3

  19

  128

  6

  5

  4

  3

  Bury

  71

  2

  3

  1

  1

  14

  0

  0

  0

  0

  89

  2

  2

  1

  1

  Manchester

  171

  1

  1

  1

  1

  28

  1

  4

  0

  0

  225

  2

  1

  1

  0

  Oldham

  102

  0

  0

  0

  0

  15

  1

  7

  0

  0

  124

  1

  1

  0

  0

  Rochdale

  76

  9

  12

  6

  8

  14

  4

  29

  2

  14

  97

  13

  13

  8

  8

  Salford

  88

  0

  0

  0

  0

  18

  4

  22

  1

  6

  113

  4

  4

  1

  1

  Stockport

  109

  0

  0

  0

  0

  15

  2

  13

  0

  0

  131

  2

  2

  0

  0

  Tameside

  80

  1

  1

  0

  0

  18

  6

  33

  3

  17

  105

  7

  7

  3

  3

  Trafford

  78

  0

  0

  0

  0

  16

  7

  44

  5

  31

  101

  7

  7

  5

  5

  Wigan

  121

  1

  1

  0

  0

  21

  1

  5

  1

  5

  151

  2

  1

  1

  1

  Barnsley

  92

  1

  1

  1

  1

  14

  2

  14

  0

  0

  109

  3

  3

  1

  1

  Doncaster

  110

  5

  5

  4

  4

  34

  2

  6

  1

  3

  151

  7

  5

  5

  3

  Rotherham

  115

  0

  0

  0

  0

  17

  1

  6

  0

  0

  139

  1

  1

  0

  0

  Sheffield

  149

  17

  11

  15

  10

  31

  8

  26

  6

  19

  197

  25

  13

  21

  11

  Bradford

  165

  10

  6

  8

  5

  87

  11

  13

  6

  7

  265

  21

  8

  14

  5

  Calderdale

  91

  8

  9

  6

  7

  15

  11

  73

  9

  60

  109

  19

  17

  15

  14

  Kirklees

  158

  4

  3

  0

  0

  32

  6

  19

  3

  9

  199

  10

  5

  3

  2

  Leeds

  247

  4

  2

  2

  1

  46

  3

  7

  1

  2

  307

  7

  2

  3

  1

  Wakefield

  131

  2

  2

  2

  2

  29

  1

  3

  1

  3

  170

  3

  2

  3

  2

  Gateshead

  80

  1

  1

  0

  0

  13

  2

  15

  0

  0

  99

  3

  3

  0

  0

  Newcastle upon Tyne

  79

  1

  1

  0

  0

  21

  1

  5

  0

  0

  110

  2

  2

  0

  0

  North Tyneside

  58

  2

  3

  1

  2

  23

  3

  13

  2

  9

  86

  5

  6

  3

  3

  South Tyneside

  58

  0

  0

  0

  0

  11

  0

  0

  0

  0

  74

  0

  0

  0

  0

  Sunderland

  100

  0

  0

  0

  0

  17

  0

  0

  0

  0

  125

  1

  1

  0

  0

  Isles of Scilly

  4

  0

  0

  0

  0

  1

  0

  0

  0

  0

  5

  0

  0

  0

  0

  Avon

  367

  7

  2

  0

  0

  60

  5

  8

  2

  3

  453

  12

  3

  2

  0

  Bedfordshire

  219

  5

  2

  3

  1

  70

  20

  29

  11

  16

  303

  26

  9

  15

  5

  Berkshire

  272

  11

  4

  8

  3

  59

  17

  29

  13

  22

  344

  28

  8

  21

  6

  Buckinghamshire

  286

  12

  4

  8

  3

  44

  11

  25

  10

  23

  350

  23

  7

  18

  5

  Cambridgeshire

  265

  10

  4

  7

  3

  44

  23

  52

  17

  39

  325

  33

  10

  24

  7

  Cheshire

  435

  10

  2

  7

  2

  67

  11

  16

  4

  6

  523

  21

  4

  11

  2

  Cleveland

  201

  1

  0

  0

  0

  44

  3

  7

  0

  0

  261

  4

  2

  0

  0

  Cornwall

  247

  2

  1

  1

  0

  31

  0

  0

  0

  0

  282

  2

  1

  1

  0

  Cumbria

  300

  35

  12

  27

  9

  42

  16

  38

  16

  38

  347

  51

  15

  43

  12

  Derbyshire

  449

  21

  5

  12

  3

  61

  27

  44

  17

  28

  530

  48

  9

  29

  5

  Devon

  439

  11

  3

  2

  0

  63

  11

  17

  7

  11

  523

  22

  4

  9

  2

  Dorset

  198

  3

  2

  2

  1

  56

  14

  25

  12

  21

  266

  21

  8

  16

  6

  Durham

  295

  0

  0

  0

  0

  43

  2

  5

  0

  0

  351

  2

  1

  0

  0

  East Sussex

  218

  1

  0

  0

  0

  35

  2

  6

  0

  0

  272

  3

  1

  0

  0

  Essex

  578

  84

  15

  77

  13

  103

  75

  73

  72

  70

  715

  162

  23

  152

  21

  Gloucestershire

  257

  24

  9

  21

  8

  42

  32

  76

  30

  71

  316

  56

  18

  51

  16

  Hampshire

  567

  21

  4

  18

  3

  93

  23

  25

  18

  19

  705

  45

  6

  37

  5

  Hereford and Worcester

  286

  3

  1

  1

  0

  76

  9

  12

  5

  7

  376

  12

  3

  6

  2

  Hertfordshire

  429

  15

  3

  12

  3

  89

  32

  36

  29

  33

  547

  47

  9

  41

  7

  Humberside

  352

  6

  2

  4

  1

  60

  4

  7

  0

  0

  427

  10

  2

  4

  1

  Isle of Wight

  46

  0

  0

  21

  0

  21

  0

  0

  0

  0

  69

  0

  0

  0

  0

  720

  721

  Primary

  Secondary

  Total schools1

  LEA area

  Schools2

  schools balloted on GM status

  Per cent. Of schools held GM ballots

  Schools voted 'yes'

  Per cent. Of schools voted 'yes'

  Schools2

  schools balloted on GM status

  Per cent. Of schools held GM ballots

  Schools voted 'yes'

  Per cent. Of schools voted 'yes'

  Schools

  Schools balloted on GM status

  Per cent. Of schools held GM ballots

  Schools voted 'yes'

  Per cent. Of schools voted 'yes'

  Kent

  567

  31

  5

  29

  5

  128

  76

  59

  74

  58

  729

  107

  15

  103

  14

  Lancashire

  598

  10

  2

  6

  1

  106

  18

  17

  9

  8

  746

  28

  4

  15

  2

  Leicestershire

  332

  4

  1

  0

  0

  79

  10

  13

  5

  6

  429

  15

  3

  6

  1

  Lincolnshire

  290

  33

  11

  29

  10

  63

  31

  49

  30

  48

  372

  64

  17

  59

  16

  Norfolk

  394

  27

  7

  21

  5

  52

  19

  37

  13

  25

  458

  46

  10

  34

  7

  North Yorkshire

  392

  5

  1

  1

  0

  59

  3

  5

  0

  0

  466

  9

  2

  2

  0

  Northamptonshire

  270

  17

  6

  13

  5

  63

  21

  33

  13

  21

  346

  38

  11

  26

  8

  Northumberland

  144

  1

  1

  1

  1

  61

  0

  0

  1

  2

  214

  1

  0

  2

  1

  Nottinghamshire

  424

  1

  0

  0

  0

  82

  9

  11

  4

  5

  533

  11

  2

  5

  1

  Oxfordshire

  237

  1

  0

  1

  0

  44

  2

  5

  0

  0

  296

  4

  1

  2

  1

  Shropshire

  212

  6

  3

  6

  2

  35

  7

  20

  7

  20

  256

  13

  5

  12

  5

  Somerset

  228

  6

  3

  4

  2

  39

  3

  8

  2

  5

  275

  9

  3

  6

  2

  Staffordshire

  409

  5

  1

  4

  1

  85

  10

  12

  5

  6

  523

  15

  3

  9

  2

  Suffolk

  256

  0

  0

  0

  0

  77

  1

  1

  0

  0

  343

  1

  0

  0

  0

  Surrey

  332

  24

  7

  22

  7

  52

  18

  35

  17

  33

  408

  42

  10

  39

  10

  Warwickshire

  235

  15

  6

  12

  5

  37

  9

  24

  8

  22

  285

  24

  8

  20

  7

  West Sussex

  247

  1

  0

  1

  0

  41

  4

  10

  0

  0

  303

  5

  2

  1

  0

  Wiltshire

  294

  27

  9

  24

  8

  44

  24

  55

  17

  39

  351

  51

  15

  41

  12

  England

  18,551

  678

  4

  507

  3

  3,614

  893

  25

  682

  19

  23,385

  1,589

  7

  1,204

  5

  1 Figures for total numbers of maintained schools in England include special schools.

  2 Figures for numbers of maintained schools, primary, secondary and total, are derived from the January 1995 DfEE Annual Schools' Census, and exclude those schools which have closed subsequent to holding a ballot on GM status. Figures for the proportion of schools that have held GM ballots need to be viewed accordingly.

  Education Vouchers
  Ms Corston
  To ask the Secretary of State for Education and Employment what sums of money(a) have been and (b) will be paid to Capita Managed Services Ltd. for issuing and redeeming nursery education vouchers for phase 1 of the voucher scheme. [3373]

  Mr. Robin Squire
  The Government's contract with Capita Managed Services Ltd. to administer phase 1 of the nursery voucher scheme was awarded after a competitive tender. The financial details are commercially confidential.

HEALTH

  Nurses
  Mr. Robin Cook
  To ask the Secretary of State for Health how many(a) district nurses and (b) health visitors were in training for each of the years between 1988 and 1995 inclusive broken down by real frequency and whole-time equivalents. [1270]

  Mr. Bowis
  This information is not available centrally. I refer the hon. Member to the English National Board for Nursing, Midwifery and Health Visiting annual reports, copies of which are available in the Library.

  Ms Harman
  To ask the Secretary of State for Health how many nurses(a) entered and (b) left the profession in each year since 1990; and if he will make a statement. [3140]

  Mr. Bowis
  This information is not available centrally.

  Clinical Depression
  Mr. Sheerman
  To ask the Secretary of State for Health what assessment his Department has made of the incidence of clinical depression in the United Kingdom. [2223]

  Mr. Bowis
  The report of the first national survey of psychiatric morbidity in Great Britain, commissioned by my Department, was published in May 1995. This described the prevalence of psychiatric disorders among adults aged 16 to 64 living in private households and 722
  showed that in this population 77 per 1,000 adults were suffering from mixed anxiety and depressive disorder and 21 per 1,000 adults from a depressive episode.

  Family Health Service Authorities
  Mr. Redmond
  To ask the Secretary of State for Health if he will instruct family health service authorities to include in the public papers of their meetings details of all cases where they have withheld remuneration from general practitioner practices to the value of £500 or more. [2240]

  Mr. Malone
  No. Decisions to withhold remuneration from a general practitioner are taken by family health services authorities under the National Health Service (Service Committee and Tribunal) Regulations 1992, as amended. Regulation 9(9) provides for the FHSA's decision to be communicated only to the parties to the proceedings, my right hon. Friend the Secretary of State and where reasonably requested to do so by either party, to any Member of either House of Parliament.

  Prozac
  Mr. Redmond
  To ask the Secretary of State for Health if he will make a statement on the prescription by psychiatrists of Prozac to children. [2229]

  Mr. Bowis
  The use of Prozac for children is not recommended under the terms of the product licence but the application of this advice is a matter for individual clinical judgment.

  Adoption and Fostering
  Mr. John Townsend
  To ask the Secretary of State for Health how many(a) adoptions there have been in the United Kingdom and (b) children have been put out to foster in each of the last 10 years; and what has been the total cost to public funds of fostering in the last year. [2133]

  Mr. Bowis
  Numbers of adoptions in England and Wales are published in "Marriage and Divorce Statistics: England and Wales 19XX. OPCS series FM2", copies of which are available in the Library. Information about adoptions in Scotland and Northern Ireland is a matter for
  723
  my right hon. Friend the Secretary of State for Scotland and my right hon. and learned Friend the Secretary of State for Northern Ireland.

  Numbers of children placed with local authority foster parents in England in the 10 years to 31 March 1993 are contained in historical tables in "Children Looked After by Local Authorities, 14 October 1991 to 31 March 1993. A/F 93/12", copies of which are available in the Library. The provisional figure for 31 March 1994 was 32,000.

  Net expenditure by local authorities on children boarded out in 1993–94, the latest year for which the information is available, was £244 million.

  West Midlands Regional Health Authority
  Mr. Redmond
  To ask the Secretary of State for Health if the unauthorised ex gratia payment to the former director of regionally managed services of the West Midlands regional health authority has been recovered. [2473]

  Mr. Malone
  The prospects for recovering this payment are presently being reviewed, taking account of recent legal advice.

  Dental Amalgam
  Mr. Llwyd
  To ask the Secretary of State for Health (1) what evaluation his Department has carried out in the past two years of the level of toxicity of mercury fillings in current use in dentistry; and if he will make a statement; [2488]

  (2) what assessment he has made of the cost to the NHS of a ban on the use of mercury-based amalgams in dentistry and the use of alternative non-mercury based amalgams; and if he will make a statement; [2522]

  (3) what recent research has been undertaken or commissioned by his Department into the exposure of patients to mercury following the use of dental silver amalgam; and if he will make a statement; [2489]

  (4) what representations he has received in respect of the ban imposed by the German Ministry of Health on the use of mercury amalgam in dentistry; and if he will make a statement; [2654]

  (5) what assessment his Department has made of the ban by the Austrian Government of the use of mercury amalgams in dental fillings for children from 1996; and if he will make a statement; [2521]

  (6) what research his Department has undertaken into mercury hypersensitivity from dental amalgam in patients giving rise to oral lichen planus lesions; and if he will make a statement; [2529]

  (7) what research his Department has (a) commissioned and (b) evaluated into the level of mercury concentration in the hippocampus, the amygdala and the nucleus basalis of people who have died of Alzheimer's disease; and if he will make a statement; [2523]

  (8) if he will evaluate the research material upon which the Swedish Government have now introduced a gradual phasing out of the use of mercury amalgam for dental fillings; and if he will make a statement. [2671]
  724
  Mr. Malone
  The Committee on Toxicity advised in 1986 that the use of dental amalgam is free from the risk of systemic toxicity and that only a few cases of hypersensitivity occur. The subsequent research findings and recent evaluations by other authoritative national and international expert committees are consistent with that advice. The Department continues to monitor and evaluate research in this area.

  There are neither reasons to ban dental amalgam nor to carry out a cost assessment of the use of amalgam or alternative materials.

  In 1994, the South and West regional health authority commissioned research by Bristol dental school into whether amalgam-related treatment should be avoided during pregnancy.

  A European working group, which includes United Kingdom representatives, is currently reviewing dental amalgam in the context of the requirements of the European medical devices directive.

  The Department is aware that the European Commission has received notification from German authorities of an intention to restrict the use of amalgam for certain patients. However, the Department has not received any formal notification of any German or Austrian ban on the use of amalgam.

  There are only a few documented cases of hypersensitivity to dental amalgam in literature and there has been no evidence to suggest an increase. The Committee on Toxicity advised that there was no need for further research.

  The Department has commissioned no research into the preponderance of mercury concentration on the brains of people who have died of Alzheimer's disease. An information sheet, prepared for the Alzheimer's Disease Society by Professor Jim Edwardson director of the MRC Neurochemical Pathology unit, concludes that there is very little evidence to link this metal with Alzheimer's disease.

  The Department has received and considered the 1994 report from Sweden which states that the expert group found no evidence that there is a connection between dental amalgam and general or specific ill health except in rare cases of hypersensitivity.

  Alzheimer's Disease
  Mr. Llwyd
  To ask the Secretary of State for Health what research his Department has(a) commissioned and (b) evaluated into the causes of high concentrations of mercury in the brain cells of deceased victims of Alzheimer's disease; if he will list the conclusions of his Department in respect of the causes; and if he will make a statement. [2524]

  Mr. Bowis
  The Department has not commissioned any such research.
  725
  Mr. Llwyd
  To ask the Secretary of State for Health how many cases of Alzheimer's disease were reported in the United Kingdom(a) 1970, (b) 1975, (c) 1980, (d) 1985, (e) 1990 and (f) 1995; and if he will make a statement. [2525]

  Mr. Bowis
  This information is not available centrally. It is estimated that there are currently around 600,00 sufferers from dementia in England and Wales.

  Royal London Hospital
  Ms. Harman
  To ask the Secretary of State for Health on what grounds a payment of £140,000 was made to a former finance director at the Royal London hospital. [3114]

  Mr. Malone
  This is a matter for the Royal Hospitals national health service trust. The hon. Member may wish to contact Sir Derek Boorman, chairman of the trust, for details.

  NHS Pension
  Mrs. Anne Campbell
  To ask the Secretary of State for Health what is the time scale for decision-taking in respect of the matter referred to in his answer 7 November,Official Report, column 678. [3086]

  Mr. Malone
  When all relevant factors have been taken into account.

  Health Visitors
  Ms Harman
  To ask the Secretary of State for Health, how much time health visitors spend each week administering purchasers' contracts. [3122]

  Mr. Bowis
  This information is not available centrally. National health service trusts and health authorities are expected locally to ensure that health visitors activity is both clinically and cost effective.

  Management Costs
  Ms Harman
  To ask the Secretary of State for Health when he will publish the league table of management costs in NHS trusts and health authorities. [3380]

  Mr. Malone
  We will be publishing information shortly.

  Clinical Negligence
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Health what is(a) the number of cases reported alleging clinical negligence, (b) the total amount of money claimed in these cases, (c) the total amount of money advised by solicitors of the trusts or otherwise resolved by them in settlement of such claims and (d) the figures for (c) expressed as a percentage of turnover, for each health trust and for England as a whole for each of the last two years for which information is available. [642]

  Mr. Malone
  This information is not available centrally.

  GP Fundholding
  Mr. MacShane
  To ask the Secretary of State for Health what percentage of general practitioners are now fundholders. [2551]
  726
  Mr. Malone
  As at April 1995, just over 39 per cent. of general practitioners are fundholders serving 41 per cent. of the population.

  Mr. MacShane
  To ask the Secretary of State for Health how many general practitioners have moved to fundholding status in each year since the inception of the scheme. [2552]

  Mr. Malone
  The information requested is shown in the table.

  Number of fundholding general practitioners

  1991–92

  1,715

  1992–93

  1,444

  1993–94

  2,944

  1994–95

  2,657

  1995–96

  1,650

  Mr. MacShane
  To ask the Secretary of State for Health what estimate he has made of the percentage of general practitioners expected on present trends to move to fundholding status(a) in 1995, (b) 1996 and (c) 1997. [2553]

  Mr. Malone
  From April 1995, over 39 per cent. of general practitioners in England are in the fundholding scheme. This is expected to increase to over 50 per cent. by April 1996 with more preparing to join in 1997.

  Mr. MacShane
  To ask the Secretary of State for Health what were the total administrative costs of running general practitioner fundholding schemes in each year since the inception of the scheme. [2554]

  Mr. Malone
  I refer the hon. Member to the reply I gave the right hon. Member for Derby, South (Mrs. Beckett) on 17 January,Official Report, columns 425–26. For 1994–95, expenditure on management allowances was £66 million.

  Mr. MacShane
  To ask the Secretary of State for Health what discussions he had with the medical profession to improve the workings of general practitioner fundholding schemes. [2555]

  Mr. Malone
  My right hon. Friend the Secretary of State has regular meetings with the medical profession to discuss a range of issues including general practitioner fundholding.

  Community Health Councils
  Mr. Jamieson
  To ask the Secretary of State for Health what plans he has for the reorganisation of community health councils in the Plymouth and Torbay area; and if he will make a statement. [2700]

  Mr. Malone
  None. The re-organisation of community health councils is a matter for regional health authorities, in their capacity as the establishing body for community health councils. They have a responsibility to ensure that CHCs are able to reflect the views of the communities they serve, for example when the establishing body are considering CHC mergers or boundary changes the first consideration must always be whether maintaining the existing CHCs will best serve the local interest.
  727
  With specific reference to the Plymouth and Torbay area, the hon. Member may wish to contact Ms Rennie Fritchie, chairman of the RHA for details.

ENVIRONMENT

  Carbon Monoxide Poisoning
  Mr. Battle
  To ask the Secretary of State for the Environment what information, advice and facilities will be made available to(a) the relatives of victims and (b) victims of carbon monoxide poisoning, and by whom, after the introduction of competition in the domestic gas supply market. [2004]

  Sir Paul Beresford
  All carbon monoxide, CO, fatalities that are notified to the Health and Safety Executive will continue to be investigated. The question of whether the industry will have a duty to conduct separate investigations into CO deaths has yet to be agreed by the Health and Safety Commission. HSE inspectors will continue to follow the general HSE policy of keeping interested parties, including those affected by CO poisoning and the families of victims, informed of progress with the investigations; informing them of any legal proceedings to be taken; liaising closely with the police and coroners courts in the case of fatal accidents; and liaising with the crown Prosecution Service if manslaughter charges should be considered. HSE inspectors also issued the leaflet "Advice to Bereaved Families" in respect of all work-related fatalities.

  Mr. Battle
  To ask the Secretary of State for the Environment what procedures the public gas transporters and emergency service providers will adopt to deal with carbon monoxide poisoning after the introduction of competition in the domestic gas supply market. [2006]

  Sir Paul Beresford
  Regulation 6(1) of the Reporting of Injuries, Diseases and Dangers Occurrences Regulations 1985 require suppliers of flammable gas to notify the Health Safety Executive forthwith of any incident notified to them, which has led to a death or other specified condition arising from exposure to carbon monoxide, CO from the incomplete combustion of gas. The supplier is also required to make a report in writing within 14 days.

  It is proposed that a revision to RIDDOR, which is expected to come into force on 1 April 1996, will transfer the duty to notify and report to HSE from suppliers to gas conveyors.

  The Health and Safety Commission issued a consultative document on draft Gas Safety (Management) Regulations in July 1995. One of the proposals was that when a gas conveyor is notified of a suspected or actual release of CO, it should attend the premises to make the situation safe.

  The HSC will shortly be considering the results of the consultation exercise, including the arrangements for dealing with CO poisoning incidents. It is intended that the new regulations will come into force on 1 April 1996.

  Mr. Battle
  To ask the Secretary of State for the Environment who will have responsibility for investigating cases of carbon monoxide poisoning after 728
  the introduction of competition in the domestic gas market. [2007]

  Sir Paul Beresford
  The Health and Safety Commission issued a consultative document in July 1995 on the draft Gas Safety (Management) Regulations. One of the proposals on which the commission specifically sought views was that a duty should be placed on gas suppliers to investigate carbon monoxide poisoning incidents.

  The HSC will shortly be considering the results of the consultation exercise, including the arrangements for dealing with CO poisoning incidents. It is intended that the new regulations will come into force on 1 April 1996.

  Mining Accident Statistics
  Mr. Battle
  To ask the Secretary of State for the Environment if he will list the private coal mining companies which publish accident figures on a six-monthly basis; what considerations apply in determining which companies provide such statistics on this basis; and what plans Her Majesty's inspectorate has to publish figures on this basis for the whole of the United Kingdom coal industry. [2053]

  Sir Paul Beresford
  The Health and Safety Executive is not aware of the private coal companies which publish accident figures on a six-monthly basis. The decision whether to publish company accident statistics is a matter for the individual company concerned. The HSE mines inspectorate publishes accident statistics for the whole of the mining industry on an annual basis and has no plans to publish any on a company basis.

  Stonehenge
  Mr. Redmond
  To ask the Secretary of State for the Environment what discussion his Department had with(a) English Heritage and (b) the Wiltshire county archaeologist about the proposal to build three houses inside the enclosure known as Vespasian's Camp in the Stonehenge world heritage site before planning permission was granted; what assessment he has made of the conformity of the permission with PPG15; what requests he has received to revoke it; and if he will make a statement. [2367]

  Sir Paul Beresford
  The Government office for the south-west received representations from English Heritage and the Wiltshire county archaeologist, as well as Salisbury district council and Chapman Warren, agents for the applicants. The planning permission was issued by Salisbury district council on 2 December 1994, including a condition which provides for archaeological investigation prior to development. On the same day, Wiltshire county council wrote to request call-in by the Secretary of State.

  The land involved is not an scheduled ancient monument and in those circumstances the district council felt unable to refuse planning consent, which was consistent with the unchallenged housing provisions of the draft local plan, unless English Heritage gave an undertaking to meet the costs of any award against the council at appeal. No such undertaking was given and English Heritage did not press the Secretary of State to call in the application.
  729
  I have received no requests to revoke the planning permission.

  EAGA Services Ltd.
  Mr. McAllion
  To ask the Secretary of State for the Environment if he will make a statement on the relationship between the energy action grants agency and EAGA Services Ltd. and on the role referred by EAGA Services Ltd. [2136]

  Mr. Clappison
  The energy action grants agency was recently renamed EAGA Ltd. EAGA Ltd. and EAGA Services Ltd. are sister companies within the EAGA group of companies. EAGA Ltd. works within the public sector, and its major contract is with the Department of the Environment to administer the home energy efficiency scheme. EAGA Services Ltd. tenders for work outside the public sector.

  Rail Deregulation
  Mr. Jim Cunningham
  To ask the Secretary of State for the Environment which Minister has ultimate responsibility for the deregulation of rural business. [2640]

  Sir Paul Beresford
  I report to the Secretary of State for the Environment on the deregulation of the burdens on business which fall within this Department's areas of responsibility.

  Mr. Cunningham
  To ask the Secretary of State for the Environment what mechanisms exist to co-ordinate the rail transport policy with the Department of Transport. [2642]

  Sir Paul Beresford
  My Department is in regular contact with the Department of Transport on all policy issues affecting the environment.

  Development Corporations
  Sir Irvine Patnick
  To ask the Secretary of State for the Environment if he will list the development corporations in the United Kingdom that were originally formed; how many are still in existence; what are their respective time limits; how much land each has reclaimed; how many jobs have been created by each corporation's activities; what value of private sector funding has been attracted by each; and if he will make a statement. [2518]

  Mr. Curry
  The information is given in the table:

  UDC

  Wind-up date

  Land reclaimed (hectares)

  Jobs created (gross)

  Private investment (£million)

  London Docklands

  31 March 1998

  709.0

  63,025

  6,084.4

  Merseyside

  31 March 1998

  342.0

  14,458

  394.0

  Black Country

  31 March 1998

  257.7

  13,357

  690.0

  Teesside

  31 March 1998

  355.6

  7,682

  837.3

  Trafford Park

  31 March 1998

  142.3

  16,197

  914.6

  Tyne and Wear

  31 March 1998

  456.4

  19,649

  758.4

  Bristol

  31 December 1995

  60.0

  4,250

  200.0

  Sheffield

  31 March 1997

  234.5

  11,342

  553.1

  Central Manchester

  31 March 1996

  33.0

  4,909

  344.8

  Leeds

  31 March 1995

  68.0

  9,066

  357.0

  Birmingham Heartlands

  31 March 1998

  54.0

  1,773

  106.8

  Plymouth

  31 March 1998

  5.5

  8

  0

  730
  All corporations except Leeds are still in existence.

  Responsibility for the Cardiff bay and Laganside development corporations lies with my right hon. Friend the Secretary of State for Wales and my right hon. and learned Friend the Secretary of State for Northern Ireland respectively.

  All outputs are cumulative to 31 March 1995.

  Housing Corporation
  Mr. Jim Cunningham
  To ask the Secretary of State for the Environment how many houses the Housing Corporation has built in rural areas; and how many he expects to be built in(a) 1996 and 1997 and (b) in each year since 1992. [2641]

  Mr. Clappison
  Since 1989–90, some 10,800 new homes have been approved in rural areas—defined as settlements with a population of 3,000 or less—through the Housing Corporation's rural programme. Of these, some 1,660 new homes were completed in 1992–93, 1,700 in 1993–94 and 1,890 in 1994–95. Rural schemes can be more difficult to develop and take longer to reach completion. We have therefore enabled the Housing Corporation to enhance grants to housing associations from 1996–97 to recognise the higher costs of developing small schemes in villages.

  Forecast figures for future years will not be available until early in the new year, when the Housing Corporation has finalised its approved development programme.

  Out-of-town Supermarkets
  Mr. Jim Cunningham
  To ask the Secretary of State for the Environment what representations his Department has received from organisations representing small rural businesses expressing concern about the impact on their trade of out-of-town supermarkets in the last year. [2574]

  Sir Paul Beresford
  We have received a small number of representations from rural business interests and local authorities in response to the draft PPG6 and the consultation exercise on the rural White Paper.

  Dearne Valley Partnership
  Mr. Hardy
  To ask the Secretary of State for the Environment how many ministerial visits have been made to the Dearne Valley Partnership since April 1992; and what has been the total cost involved of each visit. [2388]

  Sir Paul Beresford
  There have been 14 visits by sponsor Ministers and three visits by other DOE Ministers to the Dearne valley; information on the total cost of visits is not readily available.

  Government Office for the East Midlands
  Mr. Tipping
  To ask the Secretary of State for the Environment if he will list in total and by individual department the number of staff who were at the Government office for the east midlands. [2764]

  Sir Paul Beresford
  At the start of this financial year, 247 staff were attached to the Government office for the east midlands. Departments are currently meeting the office's pay costs in the following proportions:
  731

  Department of Trade and Industry: 36 per cent.

  Department of the Environment: 33 per cent.

  Department for Education and Employment: 26 per cent.

  Department of Transport: 5 per cent.

  Mr. Tipping
  To ask the Secretary of State for the Environment what are the annual revenue costs of the Government office for the east midlands. [2765]

  Sir Paul Beresford
  GOEM's pay and non-pay running costs totalled £7.3 million in 1994–95.

  Local Government Reorganisation
  Mr. Amess
  To ask the Secretary of State for the Environment what resources he will make available to authorities that have been or are to be reorganised on 1 April 1994, 1996 or 1997 for reorganisation costs incurred by them in 1995–96; and if he will make a statement. [3687]

  Mr. Curry
  On 27 July I invited authorities that have been, or are to be, reorganised on or before 1 April 1997 to submit estimates of the amount of expenditure that they expect to incur on transitional costs of reorganisation in 1995–96. On the basis,inter alia, of the information provided by the authorities, I have decided the maximum amounts that it would be appropriate to allocate towards such costs in 1995–96.I have given priority to authorities that are to be reorganised on 1 April 1996 and within that group, to the shadow authorities that are to become the new unitary authorities, and to the redundancy costs of authorities that are to be abolished.

  The amounts are as follows:

  Maximum amounts: £000s rounded

  Authority

  1995–96

  Total 1994–95 and 1995–96

  Isle of Wight

  Isle of Wight council

  1,750

  3,494

  Cleveland

  Cleveland county council

  2,500

  —

  Hartlepool borough council

  3,200

  3,748

  Langbaurgh on Tees borough council

  2,550

  2,637

  Middlesbrough borough council

  2,160

  2,354

  Stockton on Tees borough council

  2,930

  3,428

  Avon

  Avon county council

  2,500

  —

  Bristol city council

  3,000

  —

  Woodspring district council

  3,250

  —

  In Bath and North East Somerset, of which:

  3,000

  —

  Bath and North East Somerset council

  1,810

  —

  Bath city council

  600

  —

  Wansdyke district council

  590

  —

  In South Gloucestershire, of which:

  3,000

  —

  South Gloucestershire council

  1,800

  —

  Kingswood borough council

  650

  —

  Northavon district council

  550

  —

  Humberside

  Humberside county council

  2,500

  —

  Hull city council

  3,000

  —

  In the East Riding of Yorkshire. of which:

  3,200

  —

  East Riding of Yorkshire council

  1,200

  —

  Beverley borough council

  650

  —

  Boothferry borough council

  300

  —

  East Yorkshire borough council

  550

  —

  732

  Maximum amounts: £000s rounded

  Authority

  1995–96

  Total 1994–95 and 1995–96

  Holderness borough council

  500

  —

  In North Lincolnshire, of which:

  2,900

  —

  North Lincolnshire council

  1,800

  —

  Glanford borough council

  550

  —

  Scunthorpe borough council

  550

  —

  In North East Lincolnshire, of which:

  2,950

  —

  North East Lincolnshire DC

  1,900

  —

  Cleethorpes borough council

  450

  —

  Great Grimsby

  600

  —

  North Yorkshire

  North Yorkshire county council

  1,500

  —

  Ryedale district council

  410

  —

  Selby district council

  510

  —

  In York, of which:

  3,000

  —

  York district council

  2,550

  —

  York city council

  450

  —

  Total

  49,310

  52,824

  In addition, £0.2 million has been set aside, for distribution by the Home Office, for the reorganisation costs of combined fire authorities. A reserve of £0.49 million has been retained to meet any unanticipated, exceptional, costs incurred by shadow authorities.

  I have considered carefully the bids submitted by authorities that are to be, or might be, reorganised in 1997. The arrangements make it clear that these authorities would have to make an exceptional case and that priority would be given to supporting expenditures that had to be incurred in 1995–96 if reorganisation were to be implemented by the specified date, and that were of a scale that could not reasonably be found from within the authority's budget. In my view, none of the bids established a sufficiently exceptional case to justify an allocation in the current year. These authorities have, however, been invited to submit bids for 1996–97.

  Government Offices for the Regions
  Mrs. Roche
  To ask the Secretary of State for the Environment what is the cost to public funds of each of the Government offices for the region since their commencement. [1940]

  Sir Paul Beresford
  [holding answer 27 November 1995]: The expected cost to public funds of running each of the 10 Government offices in the two years from their creation in April 1994 to the end of this financial year is as follows:

  Government Office

  £ Million

  North-east

  18.160

  North-west

  21.841

  Yorkshire and Humberside

  18.850

  Merseyside

  9.675

  West Midlands

  21.731

  East Midlands

  14.508

  Eastern Region

  12.706

  South-west

  14.548

  South-east

  17.252

  London

  27.484

  733
  The Government offices have replaced the regional offices of the Departments of the Environment, Trade and Industry and the training, enterprise and education directorate of the former Employment Department, which together cost £92 million in 1993–94.

  Public Bodies
  Mr. Steen
  To ask the Secretary of State for the Environment if he will list annual income from(a) fees, (b) charges and (c) fines; what was the total number of staff employed (i) part time and (ii) full time; and what contribution his Department has made towards the annual running costs in each of the past three years in respect of (1) Her Majesty's inspectorate of pollution, (2) the British Waterways Board (3) the Health and Safety Executive, (4) the National Rivers Authority and (5) the drinking water inspectorate. [2743]

  Mr. Clappison
  [holding answer 28 November 1995]: The information is as follows with all cash figures in £ thousands and manpower figures in man-years:

  Her Majesty's Inspectorate of Pollution

  1992–93

  1993–94

  1994–95

  Income from:

  (a) Fees

  8,912

  13,935

  16,856

  (b) Charges

  15

  5

  5

  (c) Fines

  Nil

  Nil

  Nil

  Staff Numbers

  1 April 1993

  1 April 1994

  1 April 1995

  (i) Part-time

  4

  3

  7

  (ii) Full-time

  354

  433

  427

  Total

  358

  436

  434

  Running costs

  14,338

  11,252

  10,131

  British Waterways Board

  Income from

  1992–93

  1993–94

  1994–95

  (a) Fee and charges

  10,500

  11,400

  11,800

  (b) Fines

  —

  —

  —

  Average number of persons employed

  1,967

  1,804

  1,696

  Grant-in-aid1

  51,100

  49,300

  48,900

  1 BW receives a deficit grant (grant-in-aid) to cover the gap between its self-generated income and expenditure.

  Health and Safety Executive

  1992–93

  1993–94

  1994–95

  Income from

  (a) Fees

  28,000

  28,300

  22,800

  (b) Charges

  10,100

  11,300

  13,800

  (c) Fines

  Nil

  Nil

  Nil

  Staff numbers

  1 April 1993

  1 April 1994

  1 April 1995

  (i) Part-time

  361

  361

  377

  (ii) Full-time

  4,357

  4,364

  4,154

  Total

  4,718

  4,725

  4,531

  Running costs

  163,500

  169,000

  170,500

  734

  National Rivers Authority

  1992–93

  1993–94

  1994–95

  Income from

  (a) Fees1

  126,200

  136,400

  124,000

  (b) Charges2

  209,500

  199,000

  171,400

  (c) Fines

  Nil

  Nil

  Nil

  Staff numbers

  1 April 1993

  1 April 1994

  1 April 1995

  (i) Part-time3

  759

  636

  760

  (ii) Full-time

  7,483

  6,722

  6,762

  Total

  8,242

  7,358

  7,522

  Grant-in-aid4

  74,700

  61,200

  60,300

  Notes:

  1 Fees for abstraction licences, discharge consents, navigation licences, rod licences and net licences.

  2 Charges are mainly flood defence levies on local authorities.

  3 Includes limited period employees and consultant and agency staff.

  4 NRA receives a general deficit grant (grant-in-aid) to cover the gap between its income and expenditure on functions other than flood defence. It is not hypothecated between running costs and other purposes.

  Drinking Water Inspectorate

  1992–93

  1993–94

  1994–95

  Income from fees, charges and fines

  Nil

  Nil

  Nil

  Staff numbers

  1 April 1993

  1 April 1994

  1 April 1995

  (i) Full-time

  29

  31

  31

  (ii) Part-time

  1

  0

  0

  Total

  30

  31

  31

  Running costs

  1,180

  1,413

  1,660

  Running costs for Drinking Water Inspectorate are funded within the Department's running costs.

  Water Services (Yorkshire)
  Mrs. Helen Jackson
  To ask the Secretary of State for the Environment if he will set up an independent inquiry into the management of the water supply service in the Yorkshire area. [2940]

  Mr. Curry
  [holding answer 28 November 1995]: No. The Director Genral of Water Services is already investigating various aspects of Yorkshire Water's performance.

AGRICULTURE, FISHERIES AND FOOD

  Deep-sea Fish
  Mr. Dalyell
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement on the deep sea fish aspects of the international workshop referred to in his answer of 8 November,Official Report, column 878, considering the competitiveness and consistency of global arrangements for the management of the oceans. [124]

  Mr. Baldry
  The workshop will consider the key pressure points affectting the sustainability of the oceans, ocean science, linking science to management, and global arrangements for ensuing effective implementation of ocean policies. All of these issues are relevant to intergovernmental co-operation on questions related to deep sea fish.
  735

  Moroccan Tomatoes
  Mr. Atkins
  To ask the Minister of Agriculture, Fisheries and Food what consultations he has had with British horticulture interests over the European Union's proposals to increase access to European countries of Moroccan tomatoes. [2225]

  Mr. Boswell
  Growers' views on access of Moroccan tomatoes were made very clear by the NFU at the start of the negotiations.

  Mr. Atkins
  To ask the Minister of Agriculture, Fisheries and Food what discussions he has had with his opposite numbers in Spain and Portugal in connection with their requests for greater access to the European Union of Moroccan tomatoes. [2226]

  Mr. Boswell
  No bilateral discussions were held with Spanish and Portuguese Agriculture Ministers. The issue was discussed in the Foreign Affairs Council where all member states were represented.

  Agricultural Tenancies Act 1995
  Mr. Llwyd
  To ask the Minister of Agriculture, Fisheries and Food when he will lay before the House the results of monitoring of the effect of the Agricultural Tenancies Act 1995; and if he will make a statement. [2490]

  Mr. Boswell
  The Department is planning to obtain relevant information annually from the June agricultural census and a new annual survey of tenanted land commencing in 1996. This information will be published when it becomes available.

  Agriculture Fertilisers
  Mr. Llwyd
  To ask the Minister of Agriculture, Fisheries and Food what is the current level of subsidy and grant aid for the use of lime as an agriculture fertiliser; what was the level in(a) 1965 and (b) 1970; and if he will make a statement. [2527]

  Mr. Boswell
  There have been no subsidies or grant aid available for the use of lime as an agriculture fertiliser since 1976. The level of subsidy in the financial year 1964–65 was £9.9 million and in 1965–66 £8.1 million. Subsidies in the financial years 1969–70 and 1970–71 totalled £4.6 million and £5 million respectively. Lime can be beneficial in certain circumstances and decisions on its application are for farmers and growers. We see no need to subsidise its use.

  Arable Area Payments
  Mr. Tipping
  To ask the Minister of Agriculture, Fisheries and Food what was the highest payment made under the arable area payments scheme in England in 1994. [3020]

  Mr. Baldry
  For reasons of confidentiality, it is not possible to identify the highest payment under the arable area payments scheme in 1994.

  Barley
  Mr. Austin Mitchell
  To ask the Minister of Agriculture, Fisheries and Food what levels of United Kingdom intervention stocks of barley were in each 736
  month since November 1994; and what the intervention price was in each month. [159]

  Mr. Baldry
  [pursuant to his reply, 22 November 1995, c.198]: The information requested is as follows:

  Month

  Physical stock of barley at month end thousand tonnes

  Intervention price £/tones

  December 1994

  976

  103.94

  January 1995

  820

  105.08

  February 1995

  732

  1st 106.23

  17th 107.59

  21st 108.40

  March 1995

  559

  1st 109.57

  6th 109.78

  16th 111.66

  26th 112.83

  April 1995

  521

  1st 114.04

  15th 114.48

  25th 114.93

  May 1995

  478

  1st 116.14

  15th 116.78

  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

OVERSEAS DEVELOPMENT ADMINISTRATION

  Overseas Aid
  Mrs. Ewing
  To ask the Secretary of State for Foreign and Commonwealth Affairs what percentage of overseas aid to(a) sub-Saharan Africa, (b) Latin America and the Caribbean, (c) south and central asia, (d) the middle east and north Africa, (e) other Asia and Oceania and (f) eastern Europe is spent on (i) basic education, (ii) primary health care, (iii) safe drinking water, (iv) adequate sanitation, (v) family planning and (vi) nutrition. [1548]

  Mr. Hanley
  The requested information is available only for that bilateral expenditure which is allocable by sector. The most recent figures available are for financial year 1994–95, and are given in the table.

  The categories are by economic sector and each ODA project or programme is classified to a single sector. This does not present the full picture because there will be further expenditure in each of these sectors through projects which form part of other, more general, sectors. This is particularly so for family planning, which has not been separately identified. In the calendar year 1994, it is estimated that 2.3 per cent. of total United Kingdom aid, both bilateral and multilateral, was spent on reproductive health care.

  The table excludes block grants to NGOs and multilateral assistance, as it is not possible to provide a breakdown by sector. Bilateral food aid is included in the expenditure on nutrition. It is not possible to provide a sectoral breakdown of the non food aid component of emergency aid. It is likely that a significant amount of this excluded expenditure contributes to the sectors shown.
  737
  This information is provisional until the publication in December of the 1995 edition of "British Aid Statistics".

  1994–95 bilateral Gross Public Expenditure (GPEX) on selected sectors as a percentage of total bilateral GPEX in specified regions

  Basic education1

  Primary health care

  Water and sanitation2

  Nutrition3

  Sub-Saharan Africa

  2.2

  4.1

  1.0

  7.3

  Latin America and Caribbean

  2.0

  3.0

  3.2

  0.2

  South and Central Asia

  1.5

  6.8

  3.2

  0.9

  Middle East and North Africa

  1.3

  6.0

  4.6

  —

  Other Asia and Pacific

  0.7

  1.5

  2.1

  —

  Eastern Europe

  —

  0.2

  —

  0.3

  1 The amount spent on basic education comprises around 18.S per cent. of total bilateral expenditure on education in the regions shown. As for the other categories, some additional expenditure is classified to more general sectors.

  2 Information on water and sanitation projects is presented jointly since a significant amount of expenditure in these sectors is spent on joint projects.

  3 Figures for nutrition include bilateral food aid. Other emergency aid is excluded from the table.

  Mrs. Ewing
  To ask the Secretary of State for Foreign and Commonwealth Affairs what percentage of the overseas aid budget is used for(a) food, (b) medical supplies and equipment, (c) housing, (d) education and training programmes, (e) construction of infrastructure and (f) administration of development and aid programmes. [1544]

  Mr. Hanley
  The information requested in parts(c), (d) and (e) of the question is available only for that bilateral expenditure which is allocable by sector. The most recent figures available are for financial year 1994–95. Expenditure on food aid and administrative costs relates both to bilateral and multilateral aid, parts (a) and (f). It is not possible to identify separately information on medical supplies and equipment, part (b); therefore expenditure on the whole health sector is included. This information is given in the table.

  The categories shown have been defined in terms of economic sector and each ODA project or programme is classified to a single sector. This does not present the full picture for the sectors shown. There will be further expenditure in each of these sectors through broad projects which form part of more general sectors.

  The figure given for food aid includes emergency food aid. The table excludes other emergency aid, block grants to NGOs and multilateral aid, as a sector breakdown is not available. It is likely that a significant amount of this excluded expenditure contributes to the sectors shown.

  The information is provisional until the publication in December of the 1995 edition of "British Aid Statistics".

  ODA expenditure on selected sectors as a percentage of total ODA expenditure, 1994–95

  Percentage

  Percentage share of total ODA programme

  (a) Food aid1

  4.1

  (f) Administration

  2.3

  738

  ODA expenditure on selected sectors as a percentage of total ODA expenditure, 1994–95

  Percentage

  Percentage share of total ODA bilateral programme

  (a) Food aid

  3.3

  (b) Health

  7.0

  (c) Housing2

  0.5

  (d) Education

  10.4

  (e) Construction of infrastructure3

  12.8

  1 In 1994–95 £56.8 million of ODA's multilateral expenditure was spent on EC and UN food aid programmes in addition to £36.3 million of bilateral food aid. This includes both regular and emergency contributions.

  2 This figure includes expenditure on slum improvement projects.

  3 Infrastructure is defined according to the 1994 World Development Report to include: public utilities (energy, telecommunications, water, sanitation and sewerage), public works (roads, irrigation and drainage) and transport.

  Mr. Sheerman
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he expects the Government to reach the United Nations target of 0.7 per cent. gross national product for overseas aid. [2224]

  Mr. Hanley
  We have not set down a timetable for reaching the 0.7 per cent. target. Progress towards the target will depend on our economic circumstances and on other priorities for public expenditure.

  In 1994, our ODA-GNP ratio was 0.31 per cent.—above the average for all OECD donors of 0.29 per cent.

  Bilateral Aid Programme
  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs what would be the impact on the bilateral aid programme over each of the next three years of reductions of(a) 1 per cent. (b) 5 per cent. (c) 10 per cent. and (d) 12 per cent., levels in the overall aid programme. [1591]

  Mr. Hanley
  It is not possible to answer this question precisely, since there is some scope to modify certain categories of multilateral spending such as contributions to new multilateral replenishments or voluntary contributions to United Nations or Commonwealth bodies.

  Mr. Sheerman
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has received from voluntary organisations regarding the United Kingdom's bilateral aid programme in the last year. [2118]

  Mr. Hanley
  In the last year, my noble Friend the Minister for Overseas Development and her officials have had frequent contact with voluntary organisations and non-governmental organisations. This dialogue covers a wide range of issues, including the United Kingdom's bilateral aid programme.

  Kenya
  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has made to the Government of Kenya about the work of the international genocide tribunal. [2568]
  739
  Mr. Hanley
  We have made our views about the work of the international tribunal for Rwanda quite clear to the Government of Kenya. They have given assurances to the United Nations Security Council that they will co-operate with the tribunal.

  Commonwealth Institute
  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs what is his policy in respect of the future of the Commonwealth Institute; what proposed legislation will affect the Commonwealth Institute; what recent discussions he has had with the management of the Commonwealth Institute; and if he will make a statement on the outcome of those discussions. [2900]

  Mr. Hanley
  Discussions have been under way since July this year between Ministers and the executive committee of the Commonwealth Institute on its future operation after March 1996. My right hon. and learned Friend the Secretary of State for Foreign and Commonwealth Affairs met the chairman, vice-chairman, director general and chairman of the Commonwealth Institute, Scotland on 24 October to discuss future policy. The annual general meeting on 5 December will allow future options after March 1996 to be considered.

  Technical Assistance to the Commonwealth of Independent States
  Ms Quin
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will supply figures for the amount of money allocated from the TACIS programme for the environment; and what percentage of the total money allocated this represents. [1234]

  Mr. Hanley
  [holding answer 27 November 1995]: The amount committed under TACIS to the environment and nuclear safety sector from its inception up to the end of 1994 was 321 mecu—£242.44 million—representing 18.4 per cent. of total commitments.

  Land Mines
  Mr. Harry Greenway
  To ask the Secretary of State for Foreign and Commonwealth Affairs what part the United Kingdom has played in the clearance of land mines throughout the world. [835]

  Mr. Hanley
  [holding answer 29 November 1995]: We have provided more than £17.3 million over the last four years for humanitarian mine clearance operations in Afghanistan, Angola, Cambodia, northern Iraq, Laos, Mozambique, Rwanda, north-west Somalia, and Yemen.

  Gambia
  Mr. Tony Lloyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs, what discussions he has had with the Gambian regime to ensure that free and fair elections are held in July 1996. [2754]

  Mr. Hanley
  [holding answer 28 November 1995]: My right hon. Friend the Prime Minister and my noble Friend the Minister for Overseas Development had the opportunity to discuss our concerns with representatives of the regime at the Commonwealth Heads of Government meeting in Auckland and to press for a rapid return to a civilian democracy and for the full respect of human rights. The Gambia should benefit from the Millbrook
  740
  programme, which is intended to advance Commonwealth fundamental political values and support the practice of Harare principles.

  Mr. LLoyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has received about the human rights situation in the Gambia in the last year; and if he will make a statement. [2753]

  Mr. Hanley
  [holding answer 28 November 1995]: We have received numerous representations from individuals and human rights organisations on the Gambia. We have repeatedly called on the regime to respect human rights and demonstrate its own stated commitment to return the Gambia to a civilian democracy in July 1996 by lifting the ban on political activity.

  Nigeria
  Mr. Tony Lloyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs what international discussions he has had on the possibility of freezing the assets and accounts of the members of the Nigerian military regime. [2597]

  Mr. Hanley
  [holding answer 27 November 1995]: We continue to consult closely with Commonwealth, European Union and other United Nations partners on all aspects of our policy towards Nigeria. [2566]

  Mr. Lloyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs what policy in respect of Nigeria was agreed within the European Union on 20 November; and how the United Kingdom will implement it. [2598]

  Mr. Hanley
  [holding answer 27 November 1995]: On 20 November the European Union adopted a common position introducing visa restrictions on civilian Ministers and their families, a full arms embargo and a suspension of non-humanitarian aid. The measures agreed on Nigeria in 1993 remain in force. New and existing measures will be strictly implemented by the United Kingdom.

  Mr. Lloyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations his Department has received from, and what meetings it has held and on which dates, with the Nigerian-British Society since November 1993.

  Mr. Hanley
  [holding answer 27 November 1995]: We are not aware of any such society. My noble Friend the Minister for Overseas Development met a combined group from the British-Nigeria Association and the Nigerian-British Chamber of Commerce on 15 May, and held a meeting with representatives of the British-Nigeria Association on 24 August. Officials also have regular contact with these and other such organisations.

  Mr. Lloyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs what instructions were issued to the high commission in Lagos to organise meetings with representatives of(a) Shell and (b) the Ogoni people; what meetings were organised; and if he will make a statement. [2292]

  Mr. Hanley
  [holding answer 24 November 1995]: Our high commission in Lagos has had regular meetings with Shell, as it does with other companies operating in Nigeria

  741
  as a matter of routine. It has also had regular meetings with a wide variety of groups in Nigeria, including representatives of Ogoni groups.

  Mr. Winnick
  To ask the Secretary of State for Foreign and Commonwealth Affairs what has been the policy of Her Majesty's Government towards the export of arms to Nigeria in the last two years; and what is the current policy. [2254]

  Mr. Hartley
  [holding answer 24 November 1995]: Previous policy was set out in the answer given to the hon. Member for Clydebank and Milngavie (Mr. Worthington) on 2 December 1993 at column 676. On 11 November, my right hon. Friend the Prime Minister announced a full UK arms embargo against Nigeria. On 20 November, the European Union agreed to strengthen existing restrictions on arms sales to Nigeria through a full arms embargo.

  Sri Lanka
  Mr. Gerrard
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) what discussions he has held recently with the Government of Sri Lanka regarding provision of humanitarian aid to the Jaffna region of Sri Lanka; [2050]

  (2) what discussions he has held recently with representatives of the United Nations regarding provision of humanitarian aid to Sri Lanka. [2049]

  Mr. Cox
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) what discussions he has had with the Sri Lankan Government about offering food and medical supplies to people living in the northern area of Sri Lanka, with particular reference to Jaffna to alleviate suffering and hardship caused by the present conflict; and if he will make a statement; [1782]

  (2) what discussions he has had with the Sri Lankan Government on food and medical aid being made available by the British Government to the Tamil community in northern Sri Lanka; [1705]

  (3) what reports he has received from the British high commissioner in Sri Lanka on the present conflict that is taking place, with special reference to the facilities which exist to help people who have become refugees as a result of the conflict; and if he will make a statement. [1702]

  Mr. Hanley
  The high commissioner in Colombo has frequent and extensive discussions with the Sri Lankan Government and with relief agencies about the conflict and the humanitarian situation in the north of the country.

  I refer the hon. Members to the replies I gave to the hon. Member for Ilford, South, (Mr. Gapes) on 21 and 22 November at columns 67–8 and 111.

NORTHERN IRELAND

  Research and Development
  Mrs. Anne Campbell
  To ask the Secretary of State for Northern Ireland what were the indicative contributions to the EU Budget in respect of research and development for his Department in 1993–94. [1914]
  742
  Sir John Wheeler
  Table 2.1 of the statistical supplement to the "Forward Look of Government— funded Science, Engineering and Technology" contains indicative figures for the United Kingdom's contributions to the EC budget in respect of research and development. My Department does not have any policy responsibilities for Community R and D expenditure.

SOCIAL SECURITY

  Child Support Agency
  Ms Lynne
  To ask the Secretary of State for Social Security if he will update the figures on revenue collected by the Child Support Agency in his answer of 21 June,Official Report, column 252, with reference to the latest data available and also show for each month since April 1994 (a) the amount of revenue demanded attributable to type A interim assessments and (b) the amount which offsets state funds. [2266]

  Mr. Andrew Mitchell
  The administration of the Child Support Agency is a matter for the chief executive, Miss Ann Chant. She will write to the hon. Member.

  Letter from Miss Ann Chant to Ms Liz Lynne, dated 28 November 1995:
  I am replying to your Parliamentary Question to the Secretary of State for Social Security about revenue collected by the Child Support Agency.
  You asked for updated information on maintenance assessed, scheduled for payment and collected via the Agency collection service. The available information on maintenance scheduled for payment and collected by the Agency is set out in the attached table, together with how much of the maintenance collected each month has offset benefit spending. During 1994–95, 65% of maintenance collected offset benefit spending, compared with 54% to date this year.
  Additionally, between April and September 1995 £61.46 million arising from Agency assessments was paid direct between parents who do not use the Agency's collection service.
  Information on the amount of revenue attributable to Type 'A' interim assessments is not available.
  I hope this is helpful.

  Maintenance arising from CSA arrangements

  £ million

  Assessed and scheduled for payment via Agency collection Service

  Paid via Agency collection service

  Amount collected which offsets benefit spending

  Total 1993–94

  107.54

  12.57

  5.70

  1994

  April

  27.82

  3.70

  1.78

  May

  30.43

  4.04

  1.82

  June

  32.33

  4.66

  2.36

  July

  43.31

  4.80

  3.08

  August

  42.64

  5.75

  3.43

  September

  47.41

  6.10

  3.75

  October

  44.81

  6.47

  3.53

  November

  45.95

  7.03

  4.30

  December

  53.98

  7.09

  3.87

  January

  43.56

  7.85

  4.52

  February

  43.48

  7.66

  5.85

  March

  49.05

  9.09

  9.65

  Total 1994–95

  504.77

  74.24

  47.94

  743

  Maintenance arising from CSA arrangements

  £ million

  Assessed and scheduled for payment via Agency collection service

  Paid via Agency collection service

  Amount collected which offsets benefit spending

  1995

  April

  45.44

  7.92

  4.11

  May

  45.06

  8.99

  5.58

  June

  47.43

  9.31

  5.36

  July

  41.87

  9.12

  4.73

  August

  42.24

  9.70

  5.16

  September

  46.33

  10.36

  5.21

  Year to date 1995–96

  268.38

  55.40

  30.16

  Mr. Jim Cunningham
  To ask the Secretary of State for Social Security what procedure exists for the payment of arrears to the Child Support Agency by instalments. [2387]

  Mr. Mitchell
  The administration of the Child Support Agency is a matter for the chief executive, Miss Ann Chant. She will write to the hon. Member.

  Letter from Miss Ann Chant to Mr. Jim Cunningham, dated 28 November 1995:
  I am replying to your Parliamentary Question to the Secretary of State for Social Security about payments of arrears by instalments to the Child Support Agency.
  If an absent parent (AP) falls into arrears without contacting the Agency then every effort is made to get in touch with him to determine why payments have fallen behind. He will be asked to make up the missing payments, but if there is a problem, the Agency arranges an arrears agreement with the AP.
  The arrears agreement negotiated is based on the amount of debt and the AP's ability to pay. It is made clear to the AP that he will not be expected to pay more than 33% of his net income in regular payment and arrears.
  The welfare of any children involved is considered when deciding how much to enforce and officers are trained to negotiate the most reasonable level of payment in the interests of all parties.
  Where arrears are in respect of the initial payment period, the possibility of deferring debt other than that appropriate to the most recent 26 weeks can be considered in certain circumstances, where the delay in making the assessment has been substantially due to the Agency. In these circumstances, the arrears agreement is based on that 26 weeks arrears total.
  I hope this is helpful.

  Mr. Cunningham
  To ask the Secretary of State for Social Security if he will say what the procedure is for collecting arrears of Child Support from a husband who pays directly to his wife. [2386]

  Mr. Mitchell
  The administration of the Child Support Agency is a matter for the chief executive, Miss Ann Chant. She will write to the hon. Member.

  Letter from Miss Ann Chant to Mr. Jim Cunningham, dated 28 November 1995:
  I am replying to your Parliamentary Question to the Secretary of State for Social Security about collection of arrears by the Child Support Agency.
  Where child maintenance is paid directly to the parent with care PWC) by the absent parent (AP), the Agency only becomes aware arrears when the PWC get in touch to advise us of the AP's
  744
  failure to pay. If the PWC wishes the Agency to pursue the arrears she may do so by requesting the collection and enforcement service at any time. The current moratorium of fees means that no further fee will be levied for this service.
  If we are asked to undertake collection and enforcement action, the Agency confirms the amount of unpaid maintenance with the AP and arranges an arrears agreement with him. Collection is then made via the Agency so that we can monitor the arrears agreement and take any necessary action to ensure regular payments of maintenance, including enforcement action if this becomes essential.
  I hope this is helpful.

  Ms Lynne
  To ask the Secretary of State for Social Security what is the number of deduction of earning orders issued by the Child Support Agency since April 1994(a) against type A interim assessments and (b) against full maintenance assessments. [2267]

  Mr. Mitchell
  The administration of the Child Support Agency is a matter for the chief executive, Miss Ann Chant. She will write to the hon. Member.

  Letter from Miss Ann Chant to Ms Liz Lynne, dated 28 November 1995:
  I am replying to your Parliamentary Question to the Secretary of. State for Social Security about Child Support Agency assessments.
  From April 1994 to September 1995, 54,093 deduction of earnings orders have been issued by the Agency. Of these 14,478 were issued on interim maintenance assessments and 39,615 on full maintenance assessments.
  I hope this is helpful.

  Ms Lynne
  To ask the Secretary of State for Social Security if he will give a breakdown of the weekly maintenance being paid in cases where absent parents are paying child support maintenance by way of a deduction of earnings order. [1238]

  Mr. Mitchell
  The administration of the Child Support Agency is a matter for the chief executive, Miss Ann Chant. She will write to the hon. Member.

  Letter from Miss Ann Chant to Ms Liz Lynne, dated 28 November 1995:
  I am replying to your Parliamentary Question to the Secretary of State for Social Security about Child Support Agency deduction of earnings orders.
  The latest information I am able to supply is that the Child Support Agency is currently collecting in excess of £996,000 maintenance per week from absent parents, by means of deductions of earnings orders.
  I hope this is helpful.

  Ms Lynne
  To ask the Secretary of State for Social Security how many Child Support Agency cases have arrangements to pay via the agency's collection service; and how many are(a) fully paid and (b) partially paid indicating the numbers of (i) type A interim maintenance assessments and (ii) full assessments. [1237]

  Mr. Mitchell
  The administration of the Child Support Agency is a matter for the chief executive, Miss Ann Chant. She will write to the hon. Member.

  Letter from Miss Ann Chant to Ms Liz Lynne, dated 28 November 1995:
  I am replying to your Parliamentary Question to the Secretary of State for Social Security about cases using the Child Support Agency collection service. The breakdown you requested is shown in the table.

  745

  Number of cases involving type A interim maintenance assessments

  Number of cases involving full maintenance assessments

  Fully paid1

  6,545

  39,661

  Partially paid2

  15,979

  73,789

  Not paid

  60,947

  17,370

  Total

  83,471

  130,820

  1 Full compliance—no payments outstanding.

  2 Partial compliance—at least one payment received in the last 13 weeks.

  I hope this is helpful.

  Ms Lynne
  To ask the Secretary of State for Social Security what criteria have to be fulfilled for an absent parent to be classified as making regular maintenance payments. [1236]

  Mr. Mitchell
  The administration of the Child Support Agency is a matter for the chief executive, Miss Ann Chant. She will write to the hon. Member.

  Letter from Miss Ann Chant to Ms Liz Lynne, dated 28 November 1995:
  I am replying to your Parliamentary Question to the Secretary of State for Social Security about Child Support Agency assessments.
  You asked what criteria have to be fulfilled for an absent parent to be classified as making regular maintenance payments. An absent parent is considered to be complying in full if all outstanding payments have been received; and partially if at least one payment has been received in the last 13 weeks.
  I hope this is helpful.

  War Widows' Pensions
  Mr. Dover
  To ask the Secretary of State for Social Security if he will make a statement about the level of resources allocated to the payment of war widows' pensions. [2832]

  Mr. Heald
  These are matters for Mr. John Sheppard, the acting chief executive of the War Pensions Agency. He will write to the hon. Member.

  Letter from John Sheppard to Mr. Den Dover, dated 28 November 1995:
  The Secretary of State for Social Security has asked me to reply to your recent Parliamentary Question about the level of resources allocated to the payment of War Widows Pensions.
  As at 27 November, a total of 98 staff are employed on dealing with all aspects of war widows claims. Included in this figure are 45 members of staff dealing with the restoration of War Widows Pension under the Pensions Act, which came into effect on 19 July 1995. Agency expenditure in this financial year for all the above is expected to be £780,000.
  I hope you find my reply helpful.

  National Insurance Numbers
  Mr. Gordon Prentice
  To ask the Secretary of State for Social Security how many people have been prosecuted in each year since 1987 for using bogus national insurance numbers. [1989]

  Mr. Heald
  There is no separately identifiable offence of using a bogus national insurance number. However, the use of a false NINO can form the basis of a prosecution under section 112 of the Social Security Administration Act 1992 or other legislation such as the Theft Act 1978. A person may be guilty of an offence if he supplies to the 746
  Department, for a purpose connected with social security legislation, information he knows to be false. The number of prosecutions involving false or misappropriated NINOs is not separately available.

  Social Fund
  Mr. Chris Smith
  To ask the Secretary of State for Social Security what amounts, in cash terms, have been spent on the administration of the social fund for each year since its inception; and what percentage of the total fund this represented in each year. [2082]

  Mr. Roger Evans
  Social fund administration costs are met separately from expenditure from the regulated and discretionary fund. The figures requested are set out in the table; 1993–94 is the latest year for which figures on administration costs are available.

  Year

  Administration cost (£ million)

  Percentage of gross expenditure

  Percentage of total gross expenditure plus recoveries

  1988–89

  61

  30.3

  24.5

  1989–90

  77

  32.1

  22.1

  1990–91

  132

  48.5

  33.3

  1991–92

  163

  48.2

  33.5

  1992–93

  208

  51.9

  35.3

  1993–94

  270

  61.1

  41.4

  The table compares administration costs in each year since 1988–89 to the fund's gross expenditure—that is, the money paid out. However, the fund's business involves paying money out and recovering the amounts awarded as loans. A more accurate reflection of the work needed to operate the fund would therefore be a comparison between administration costs and gross expenditure plus recoveries, and this information is also given in the table.

  In 1990–91 the basis of the calculation of administration costs changed, and so direct comparisons with previous years are not possible.

  In both 1992–93 and 1993–94 the rise in administration costs is largely attributable to expenditure on the new social fund computer system, which was purchased and put in place during those years.

  Local Government
  Mr. Vaz
  To ask the Secretary of State for Social Security if he will list the Acts of Parliament including Consolidation Acts that affect local government that have been introduced by his Department since January 1994. [39]

  Mr. Burt
  The Jobseeker's Act 1995 section 18.

  Residential Care and Nursing Homes
  Mr. Robin Cook
  To ask the Secretary of State for Social Security what was(a) DSS income support expenditure for residents in private and voluntary residential nursing homes and (b) the number of claimants in Scotland between 1979 and 1994. [1142]

  Mr. Roger Evans
  No data for Scotland are available prior to 1988. The available information is set out in the table:
  747

  Number of claimants and income support expenditure on residents in residential care and nursing homes in Scotland

  Number of claimants

  Year

  Residential care

  Nursing homes

  Residential allowance

  Annualized Cost £ million

  1988

  6,000

  4,000

  —

  62

  1989

  6,000

  4,000

  —

  65

  1990

  9,000

  6,000

  —

  98

  1991

  9,000

  9,000

  —

  145

  1992

  10,000

  12,000

  —

  201

  1993

  10,000

  11,000

  —

  219

  1994

  8,000

  9,000

  5,000

  208

  Notes:

  1. Figures prior to 1994 are a "snap-shot" taken at a particular month each year. From 1988 the month of the inquiry was May.

  2. Numbers have been rounded to the nearest thousand and expenditure to the nearest million.

  3. Expenditure for 1994 has been calculated by adding together the estimated quarterly expenditure May 1993-February 1994 (number of cases multiplied by average Income Support multiplied by 13). Expenditure prior to 1994 has been calculated by multiplying the number of cases by the average weekly Income Support and multiplying by 52. For 1990 and 1991 average Income Support for Scotland is not known and the figure for Great Britain has been used.

  4. Residential Allowance was introduced in April 1993. Figures for 1993 are negligible. For 1994 the figures shown are for preserved rights cases split by residential care and nursing homes and Residential Allowance for which no equivalent split is available.

  Source:

  Income Support Quarterly Statistical Inquiries—Residential Care nd Nursing Home Inquiries May 1991–1994.

  Income Support Quarterly Inquiries—Board and Lodging Inquiry 1988–1990.

  Cold Weather Payments
  Ms Lynne
  To ask the Secretary of State for Social Security how many pensioners received cold weather payments in each region over the last five years; and if he will make a statement. [1091]

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

  Benefits (Savings)
  Mr. Alex Carlile
  To ask the Secretary of State for Social Security what is his estimate of the financial savings that will be made by(a) the proposed changes to entitlements to social security benefits for asylum seekers, (b) other announced changes to entitlements to social security benefits and (c) other planned changes to entitlements to social security benefits; and if he will make a statement. [2349]

  Mr. Roger Evans
  The savings as a result of the proposed changes to social security benefits for asylum seekers are estimated to amount to £300 million a year by the year 2000–01.

  As a result of measures announced today and in the previous two Budgets it is estimated that £5 billion a year in benefit expenditure will be saved by 2000–01.

  Both these figures are in 1995–96 prices.

  Disability Working Allowance
  Mr. Bradley
  To ask the Secretary of State for Social Security what is the average length of time a claimant 748
  receives disability working allowance, including awards on renewal. [1836]

  Mr. Andrew Mitchell
  [holding answer 24 November 1995]: As at 30 April 1995, the average length of time a claimant received disability working allowance, including awards on renewal, was 46 weeks.1

  1 This figure relates to all awards, both completed and current at 30 April 1995.

  Source: 100 per cent. scan of all DWA claims.

WALES

  Staff (Town and Country Planning)
  Mr. Llwyd
  To ask the Secretary of State for Wales how many members of staff are employed in the town and country planning section of the Welsh Office at Cathays park; and if he will make a statement. [2804]

  Mr. Hague
  The number of staff employed by my Department who work on town and country planning matters is 50.8 full-time equivalents.

  These include staff working in planning inspectorate in Wales.

  Beef Special Premium Scheme
  Mr. Llwyd
  To ask the Secretary of State for Wales when the beef annual premium was paid to farmers in Wales in(a) 1991, (b) 1992, (c) 1993, (d) 1994 and (e) 1995. [2803]

  Mr. Gwilym Jones
  The Welsh Office assumed responsibility for the scheme in 1993. Payments were previously made, under the different scheme rules that were then in place, by the Intervention Board, as and when cattle were presented for slaughter or marketed with a view to slaughter.

  Since the Welsh Office took over the scheme, payments began in the following months:

  1993: December

  1994: November

  1995: November

  Poverty
  Mr. Llew Smith
  To ask the Secretary of State for Wales what estimate he has made of the number of people in Wales living in poverty; what plans he has to reduce this figure; and if he will make a statement. [2731]

  Mr. Gwilym Jones
  No Government of any political persuasion have ever accepted that it is possible to define poverty in a meaningful way.

  Statistics on patterns of household disposable income, for the United Kingdom as a whole, are provided in "Households Below Average Income 1979–1992/93", a copy of which is in the Library of the House. Information for Wales is not available separately.

  Textile Industry
  Mr. Barry Jones
  To ask the Secretary of State for Wales how many persons are currently employed in the textile and garment making industry in Wales. [2919]
  749
  Mr. Gwilym Jones
  The latest available figures are for 1993 when, according to the census of employment, the number of employees employed in the manufacture of textiles and wearing apparel in Wales was 12,300.

  School Transport
  Mr. Hanson
  To ask the Secretary of State for Wales what advice he has issued to local authorities with regard to escort provision on school transport services. [2928]

  Mr. Gwilym Jones
  Welsh Office Circular 19/95 "Home to School Transport", which was issued on 10 May 1995, contains guidance about local education authorities' responsibilities in providing supervision on school transport.

  A copy is available in the Library of the House.

  Mr. Hanson
  To ask the Secretary of State for Wales (1) what new initiatives he proposes to improve safety on school buses; [2929]

  (2) if he will review the current advice given to local authorities with regard to the maximum numbers of pupils per seat on school transport. [2927]

  Mr. Norris
  I have been asked to reply.

  I hope to lay two sets of regulations before the House later this autumn. The first will require seat belts to be fitted in minibuses and coaches used specifically for the transport of children. The second will remove the concession allowing three seated children, under 14 to count as two passengers, when travelling on public service vehicles fitted with seat belts.

  Housing Expenditure
  Mr. Barry Jones
  To ask the Secretary of State for Wales what is the planned expenditure for housing in Wales for the year 1996–97; and if he will make a statement. [2925]

  Mr. Gwilym Jones
  My right hon. Friend will be announcing the details of his public expenditure decisions for 1996–97 in December.

  Clinical Negligence Claims
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Wales what was(a) the number of cases reported alleging clinical negligence, (b) the total amount of money

  Table 1: Amounts raised from the council tax, band D averages and per dwelling averages, 1993–94 to 1995–96 at constant 1995–96 prices

  Total amount of council tax budgeted to be collected (£ million)

  Average band D council tax (£)

  Average council tax per dwelling (£)

  1993–94

  1994–95

  1995–96

  1993–94

  1994–95

  1995–96

  1993–94

  1994–95

  1995–96

  Alyn and Deeside

  9.8

  9.7

  10.4

  398

  393

  403

  358

  351

  357

  Colwyn

  7.6

  7.8

  8.1

  377

  372

  387

  330

  325

  338

  Delyn

  9.1

  9.1

  9.8

  397

  377

  401

  358

  340

  360

  Glyndwr

  5.5

  5.7

  5.9

  374

  366

  383

  328

  330

  345

  Rhuddlan

  7.1

  7.3

  7.7

  393

  384

  399

  328

  319

  333

  Wrexham Maelor

  14.4

  14.5

  15.1

  398

  388

  406

  330

  320

  334

  Carmarthen

  7.4

  8.2

  9.0

  363

  390

  439

  326

  355

  397

  Ceredigion

  9.5

  10.3

  11.3

  373

  404

  451

  337

  370

  406

  Dinefwr

  5.0

  5.3

  6.0

  364

  394

  445

  313

  339

  379

  Llanelli

  9.5

  10.3

  11.5

  414

  447

  495

  317

  341

  378

  750
  claimed in these cases, (c) the total amount of money advised by trust solicitors or otherwise resolved by trusts in settlement of such claims, and (d) the figures for (c) expressed as a percentage of turnover, for each health trust and for Wales as whole for each of the last two years for which information is available. [641]

  Mr. Richards
  I will write to the hon. Member and will place a copy of my reply in the Library of the House.

  Council Tax
  Mr. Dafis
  To ask the Secretary of State for Wales (1) if he will list for each district council in constant 1995 prices the actual amount collected in council tax within each band and in average terms for each available year since its introduction, indicating also the corresponding amounts collected per household; [1850]

  (2) if he will list for each unitary council and for Wales as a whole (a) the estimated council tax which would be collected based on the latest provisional assessments issued to councils by his office and (b) the actual council tax levied during 1995–96 for each band and in average terms, indicating also the corresponding amounts collected per household; and if he will make a statement. [1851]

  Mr. Gwilym Jones
  The available information is given in the following tables. Table 1 gives the amounts of council tax budgeted to be collected by each authority at the beginning of each financial year. This information is not collected by band. The average per dwelling is based on the number of dwellings liable for the council tax in the relevant year.

  Table 2 gives the available, equivalent information for unitary authorities.

  The figures for the implied council tax levels in 1995–96 have been derived from the final disaggregated budget and indicative standard spending assessments issued on 27 October. These redistribute 1995–96 budgets and SSAs for the existing councils to the new authorities. Weighted band D taxes, based on the actual 1995–96 taxes set in each district area within the new unitary boundaries, are given together with estimates of the amount which would have been raised by that level of tax. Per dwelling averages are not available.

  On 30 October, I announced that a scheme would be introduced to damp the increases in council tax arising from the disaggregation exercise.

  751

  Table 1: Amounts raised from the council tax, band D averages and per dwelling averages, 1993–94 to 1995–96 at constant 1995–96 prices

  Total amount of council tax budgeted to be collected £ million)

  Average band D council tax (£)

  Average council tax per dwelling (£)

  1993–94

  1994–95

  1995–96

  1993–94

  1994–95

  1995–96

  1993–94

  1994–95

  1995–96

  Preseli Pembrokeshire

  9.0

  9.8

  10.7

  354

  381

  427

  313

  340

  378

  South Pembrokeshire

  5.7

  6.0

  6.8

  339

  368

  416

  304

  322

  367

  Blaenau Gwent

  6.4

  6.7

  7.2

  315

  319

  343

  217

  220

  238

  Islwyn

  5.9

  5.9

  6.4

  319

  308

  334

  224

  236

  255

  Monmouth

  10.1

  10.3

  11.1

  330

  330

  351

  349

  346

  368

  Newport

  13.9

  14.3

  15.3

  324

  328

  349

  272

  277

  294

  Torfaen

  8.8

  9.1

  10.0

  326

  327

  354

  253

  259

  280

  Aberconwy

  7.2

  7.2

  8.4

  345

  361

  400

  307

  323

  359

  Arfon

  5.8

  6.3

  6.7

  342

  365

  382

  270

  286

  302

  Dwyfor

  3.9

  4.2

  4.7

  327

  347

  384

  288

  307

  340

  Meirionnydd

  4.7

  4.7

  5.2

  359

  356

  391

  295

  291

  318

  Ynys Mon

  9.1

  9.3

  10.0

  353

  370

  399

  304

  323

  349

  Cynon Valley

  5.2

  6.3

  7.0

  299

  356

  390

  208

  249

  274

  Merthyr Tydfil

  4.7

  5.6

  6.4

  294

  349

  396

  203

  242

  274

  Ogwr

  12.5

  15.9

  18.3

  297

  358

  401

  248

  304

  342

  Rhondda

  5.9

  7.4

  8.3

  292

  353

  400

  191

  235

  266

  Rhymney Valley

  8.7

  10.5

  11.9

  299

  357

  402

  227

  271

  305

  Taff Ely

  9.5

  11.0

  12.3

  324

  365

  402

  268

  300

  332

  Brecknock

  5.2

  5.6

  6.2

  326

  356

  393

  310

  339

  370

  Montgomeryshire

  6.2

  6.8

  7.6

  312

  341

  377

  284

  311

  343

  Radnorshire

  2.9

  3.2

  3.6

  309

  341

  378

  287

  317

  348

  Cardiff

  29.3

  29.6

  33.8

  302

  299

  338

  266

  265

  299

  Vale of Glamorgan

  13.1

  13.3

  15.4

  310

  313

  353

  308

  310

  348

  Port Talbot

  5.5

  5.9

  6.4

  366

  385

  419

  279

  293

  317

  Lliw Valley

  7.3

  7.9

  8.7

  366

  384

  419

  298

  313

  341

  Neath

  8.0

  8.6

  9.3

  400

  422

  454

  313

  328

  353

  Swansea

  22.3

  24.7

  26.6

  376

  397

  435

  317

  339

  366

  Wales

  321.6

  344.4

  379.1

  341

  358

  392

  287

  303

  330

  Source:

  Local authority returns.

  Table 2: Band D council tax estimates for unitary authorities—estimates based on the latest budget and indicative SSAs compared with averages of actual taxes levied in component districts, 1995–96

  (a) Estimates based on latest unitary budget figures and indicative SSAs for 1995–96

  (b) Estimates based on weighted averages of actual band D taxes set in component districts in 1995–96

  Implied band D council tax (£)

  Implied council tax to be collected (£ million)

  Weighted band D council tax (£)

  Implied council tax to be collected (£ million)

  Anglesey

  320

  8.0

  399

  10.0

  Caernarfonshire and Merionethshire

  422

  18.1

  385

  16.5

  Aberconwy and Colwyn

  292

  12.0

  394

  16.2

  Denbighshire

  491

  16.1

  393

  12.9

  Flintshire

  426

  21.4

  402

  20.2

  Wrexham

  367

  14.5

  405

  15.9

  Powys

  348

  16.1

  383

  17.7

  Cardigan

  590

  14.8

  451

  11.3

  Pembrokeshire

  372

  15.4

  423

  17.5

  Carmarthenshire

  443

  25.2

  463

  26.4

  Swansea

  348

  26.1

  432

  32.5

  Neath and Port Talbot

  515

  21.9

  436

  18.5

  Bridgend

  392

  17.1

  401

  17.6

  Vale of Glamorgan

  346

  15.8

  355

  16.2

  Rhondda, Cynon, Taff

  490

  32.8

  398

  26.7

  Merthyr Tydfil

  435

  7.1

  396

  6.4

  Caerphilly

  407

  19.8

  375

  18.3

  Blaenau Gwent

  524

  10.2

  343

  6.7

  Torfaen

  351

  9.9

  354

  10.0

  Monmouthshire

  242

  8.0

  351

  11.7

  Newport

  246

  10.7

  349

  15.3

  Cardiff

  371

  38.1

  339

  34.9

  Wales

  392

  379.1

  392

  379.1

  Source:

  Local authority returns.
  752 753

  Students
  Mr. Alex Carlile
  To ask the Secretary of State for Wales how many students in Wales applied for student loans in each year since 1991; and if he will make a statement. [2338]

  Mr. Hague
  These are matters for the Student Loans Company. I have asked the acting chief executive to write to the hon. Member.

  Mr. Alex Carlile
  To ask the Secretary of State for Wales how many students in Wales applied for hardship funds in each year since 1991; and if he will make a statement. [2339]

  Mr. Hague
  Since the academic year 1990–91 institutions in Wales have received student access funds so that they may provide financial help to students in financial difficulties. Institutions may supplement these funds from their own resources.

  The number of students in the former public sector further and higher education institutions in Wales applying for assistance from the access funds in the academic years 1990–91 to 1993–94 is as follows:

  1990–91: 3,102

  1991–92: 3,827

  1992–93: 3,597

  1993–94: 3,317.

  Information on applications to the colleges of the university of Wales is not available prior to 1993–94. In that year, 3,260 students applied for assistance from the access funds. Information for academic year 1994–95 is not yet available.

  Mr. Alex Carlile
  To ask the Secretary of State for Wales what was the average grant received by undergraduate students in Wales in each year since 1991; and if he will make a statement. [2340]

  Mr. Hague
  The average net maintenance grants, after means-testing, received by mandatory award holders in Wales in the academic years 1990–91 to 1993–94 are set out in the following table. Since 1990–91, eligible students have also had access to non-means-tested student loans.

  Average net maintenance grants to holders of mandatory awards (£) Wales: 1990–91 to 1993–94

  Academic year

  Average net maintenance grant paid by local education authorities1

  1990–91

  1,590

  1991–92

  1,620

  1992–93

  1,690

  1993–94

  1,740

  1 To the nearest £10.

  754
  Mr. Alex Carlile
  To ask the Secretary of State for Wales what research has been undertaken in the last five years by his Department into the level of students suffering from stress and depression; and if he will make a statement. [2341]

  Mr. Hague
  None.

  Mr. Alex Carlile
  To ask the Secretary of State for Wales what steps his Department has taken to improve the welfare and counselling services to students in the last five years; and if he will make a statement. [2342]

  Mr. Hague
  As autonomous bodies, it is for individual further and higher education institutions to ensure that such services are sufficient to enable students to take full advantage of the educational opportunities available to them.

  Dental Services
  Mr. Alex Carlile
  To ask the Secretary of State for Wales what was the average annual payment, for each of the last three years for which figures are available, for patients who paid for NHS dental treatment, per family health services authority; and if he will make a statement. [2763]

  Mr. Hague
  Information about patient charges is held on the basis of individual courses of treatment rather than per patient. The estimated average patient charge per course of treatment is given in the following table:

  Year ending March (£)

  Family health services authority

  1993 £

  1994 £

  1995 £

  Clwyd

  19.65

  18.91

  20.06

  Dyfed

  20.16

  19.61

  20.34

  Gwent

  20.47

  19.45

  20.34

  Gwynedd

  18.88

  18.06

  17.82

  Mid Glamorgan

  20.60

  19.69

  20.60

  Powys

  20.49

  20.16

  21.72

  South Glamorgan

  19.97

  19.76

  21.36

  West Glamorgan

  18.78

  18.41

  19.09

  Source:

  Dental Practice Board.

  Exempt patients and patients receiving remission from charges are excluded. The year relates to the date on which payment for treatment was authorised by the Dental Practice Board.

  Assisted Places Scheme
  Sir Wyn Roberts
  To ask the Secretary of State for Wales what plans he has to extend the assisted places schemes in Wales. [3685]

  Mr. Hague
  As I mentioned in the Welsh Grand Committee earlier today, I proposed to double the number of places available under the assisted places scheme in Wales over a period of time. Over 700 pupils in Wales are currently benefiting from the scheme which makes an important contribution to our policy of parental choice, diversity and excellence in education.
  755
  I propose to invite bids for additional places from schools already participating in the scheme and other schools which have reached an appropriate standard. Schools must be able to provide a broad and balanced curriculum and have a good record of performance in public examinations.

  Bids will be invited for places at age 11 or 13, where there is currently a high demand, and at sixth form, bids will also be invited for places for children below age 11 years in junior departments which form an integral part of secondary schools.

  Regional Selective Assistance
  Mr. Morgan
  To ask the Secretary of State for Wales if he will list the outturn figures for regional selective assistance(a) offers and (b) payments for 1994–95; and if he will indicate how these figures related to the original budgeted plans for that year. [2110]

  Mr. Hague
  [pursuant to his reply, 24 November 1995, c. 414]: I regret that there was an error in my answer. The reference for the Industrial Development Act 1982 annual report should have been HC 723, not Cm 723 as quoted.

DEFENCE

  Executive Agencies
  Mr. Redmond
  To ask the Secretary of State for Defence if he will list for each of his executive agencies for the last financial year in respect of overseas travel by agency staff(a) the costs of the travel, (b) the countries visited and (c) the posts held by the staff concerned. [2288]

  Mr. Arbbuthnot
  This is a matter for the agencies concerned. I have asked the chief executives to write to the hon. Member.

  Letter from N. R. Essenhigh to Mr. Martin Redmond, dated 29 November 1995:
  Your question to the Secretary of State asking about overseas travel in 1994/95 has been passed to me for reply as Chief Executive of the Hydrographic Office.
  The overseas travel costs incurred by the Agency in 1994/95 were £123,252.11. A list of the countries visited is at Annex A; and the posts held by the staff concerned is at Annex B.
  I hope this information is helpful.

  COUNTRIES VISITED BY HYDROGRAPHIC OFFICE STAFF FY 1994/95

  Argentina

  Australia

  Bahrain

  Belgium

  Canada

  Cuba

  Denmark

  756

  Falkland Islands

  Finland

  France

  Germany

  Greece

  Gibraltar

  Holland

  Hong Kong

  Iceland

  Italy

  Japan

  Korea

  Malaysia

  Monaco

  Norway

  Oman

  Portugal

  Singapore

  Spain

  South America

  South Africa

  Sweden

  USA

  POSTS OF HYDROGRAPHIC OFFICE STAFF MAKING OVERSEAS VISITS FY 1994–95

  Hydrographer

  Deputy Chief Executive

  Director Defence Requirements

  Director Production and Marketing

  Director Information Systems

  Director Nautical Charts and Publications

  Head of Product Development

  Head of Bilateral Arrangements

  Head of Maritime Safety Information

  Head of Physical Oceanography

  Head of Sales and Marketing

  Head of Information Processing Project

  Head of Finance

  Head of Submarine Operations and Surveys

  Head of Nautical Chart Branch 1

  Head of Nautical Chart Branch 4

  Head of Nautical Chart Branch 5

  Head of MOD/RN Requirements and Co-ordination

  Head of Tidal Branch

  Head of International Liaison

  Retired Officer 2-Maritime Safety Information

  Staff Officer Survey Planning

  Commercial Sales Manager

  SMCO Information Processing Project Implementation

  SMCO Submarine Operations and Surveys

  SMCO Operational Charting and Mine Countermeasure Support

  757

  SMCO Physical Oceanography

  Engineering Manager

  Technical Officer Ship Equipment (HPTO)

  SMCO Printing

  SMCO Marketing

  Assistant Maritime Safety Information (Defence)

  Reviser Tidal Branch

  HMCO Information Processing Project Implementation

  HMCO Physical Oceanography

  HMCO Submarine Operations and Surveys

  SMCO MOD/RN Requirements and Co-ordination

  HMCO Geodesy

  HMCO Printing

  HMCO Marketing

  Technical Officer Print Equipment (PTO)

  Technical Officer Ship Equipment (PTO)

  ABBREVIATIONS

  SMCO = Senior Mapping and Charting Officer

  HMCO = Higher Mapping and Charting Officer

  HPTO = Higher Professional and Technical Officer

  PTO = Professional and Technical Officer

  Letter from Alan Pollard to Mr. Martin Redmond, dated 29 November 1995:
  I have been asked by the Minister to reply to your parliamentary question on overseas travel by Defence Agency Staff during Financial Year 1994–95. LISA was formed on 21 November 1994 and the figures listed at the Annex to this letter are based on travel after that date and before 1 April 1995. The figures do not include my staff travelling on RAF flights in support of operations, since I do not hold such costs. If you require further details please do not hesitate to contact me.

  Travel overseas by LISA personnel-Financial Year 1994–95

  Country

  Post

  Cost £

  Germany

  HPTO

  159.70

  Germany

  Captain

  175.60

  Germany

  Major

  159.70

  Canada

  Warrant Officer

  1,678.46

  Germany

  HEO Lieutenant

  282.26

  Germany

  Colonel

  282.26

  Germany

  Captain

  159.70

  Germany

  Captain

  236.46

  Germany

  Contractor

  236.46

  Germany

  Contractor

  236.46

  USA

  AO

  2,641.00

  Germany

  Colonel

  159.70

  Germany

  RO2

  159.70

  Germany

  Contractor

  249.86

  Canada

  EO

  2,507.40

  Canada

  PTO

  2,291.06

  Germany

  Captain

  321.70

  Canada

  Warrant Officer

  2,507.40

  Canada

  EO

  2,507.40

  Germany

  Captain

  322.56

  Germany

  Captain

  322.56

  Germany

  Captain

  341.68

  758
  Letter from Captain W. S. Graham to Mr. Martin Redmond, dated 29 November 1995:
  1. In your Parliamentary Question to the Secretary of State for Defence, you asked for a list for each of his executive agencies for the last financial year in respect of overseas travel by agency staff:

  (a) the costs of the travel

  (b) the countries visited

  and

  (c) the posts held by the staff concerned In response:

  2. RNAY Fleetlands

  (a) £8601 spent on Travel and Subsistence.

  (b) Countries visited: Holland, Cyprus, Germany and Norway.

  (c) Variety of Industrial and Non Industrial posts held consisting of:

  Quality Assurance Manager

  Engineering Manager

  Dope Shop Supervisor

  Safety Officer

  Quality Inspectors

  Technical Officer

  Engineering Desk Officer

  Aircraft Fitters (6)

  3. RNAW Almondbank

  (a) £3088 spent on Travel and Subsistence

  (b) USA only country visited

  (c) Engineering Services Manager Engineering Desk Officer.

  Letter from Philip Wildman to Mr. Martin Redmond, dated 29 November 1995:
  1. The Secretary of State has asked me to reply direct to your question seeking details of overseas travel undertaken by the staff of this Defence Agency in Financial Year 1994–95.1 regret that the Chief Executive is unable to reply personally due to absence.

  2. The answers you require are as follows:

  (a) Cost of Travel—£578,000 excluding costs of centrally provided trooping services e.g. Washington and British Forces Germany.

  (b) Countries Visited—see Annex A attached.

  (c) Posts Held by Staff Concerned—

  (1) Serial 1—Headquarters

  Director General and supporting staff.

  (2)Serial 2—Commitments

  Commitments staff are responsible for MOD geographic policy and its related NATO and international aspects.

  (3) Serial 3—Acquisition

  Acquisition staff are responsible for the development and maintenance of highly cost-effective exchange agreements which enable Military Survey to obtain the geographic data essential for Defence needs world-wide.

  (4) Serial 4—Production and Information Systems

  Production staff travel is undertaken to manage the technical aspects of NATO and international coproduction and burden-sharing agreements. In addition, some travel by Information Systems staff is in support of standards and compatibility work to facilitate the international exchange of geographic data.

  3. I hope you find this information useful.

  759

  Military Survey Defence Agency Overseas Travel Destination Financial Year 94–95

  Serial

  Function

  Countries Visited

  1

  Headquarters (Director General and senior staff)

  Germany, Belgium, Czech Republic.Greece, Australia, Bosnia, Norway, Romania, Turkey USA.

  2

  Commitments

  Belgium, Germany, Bosnia, USA, Spain, Denmark, Canada, Cyprus, Honk Kong, Holland

  3

  Acquisition

  USA, Czech Republic, Greece, dubai, Muscat, Austria, Bahrain, Saudia Arabia, Sweden South Africa, Zimbabwe, Zambia, Mozambique, Hungary.

  4

  Production and Information Systems

  Germany, Belgium, USA, Finland, France, Canada,Denmark, Norway, Holland, Poland, Cyprus.

  Letter from Jim Drew to Mr. Martin Redmond, dated 29 November 1995:
  I have been asked to reply, as Chief Executive of the Army Base Repair Organisation (ABRO), to your recent Parliamentary Question asking the Secretary of State if he will list for the FY 94/95 details in respect of overseas travel as follows:

  a.costs of travel

  b.countries visited

  c.posts held by staff who visited those countries.

  I detail below the information in respect of ABRO:

  Grade

  Destination

  Subsistence Cost (£)

  G7

  Production Engineers

  Canada

  501

  SPTO

  Paris, Sweden, Germany

  884

  HPTO

  Paris, Sweden, Belgium, Germany, Luxembourg

  2,388

  RO1

  Supply

  Germany

  119

  EO

  Managers

  Germany

  104

  Med/Dent

  Repair

  Belize

  465

  Sen C/Hand

  Technicians

  Belgium

  181

  Total

  4,642

  The total commercial air costs were £4,783, which has proven difficult to break down in the time available and does not include air trooping flights for which we are not charged. The first 3 elements in the above table were directly related to repair support contracts in place with commercial companies based in these countries: the remainder were routine staffing meetings with our customers and suppliers.

  Therefore, the total overseas travel costs were £9,425.

  Letter from Michael Maycroft to Mr. Martin Redmond, dated 29 November 1995:
  I have been asked by the Secretary of State for Defence to reply to your Parliamentary Question about overseas travel by agency staff. As the Chief Executive of the Defence Clothing and Textiles Agency (DCTA) I can advise you of the following information in respect of this agency.
  760
  During the financial year 1994–95 the cost of overseas travel made by DCTA personnel was £42,503 and the countries visited were:

  Australia

  Belgium

  Canada

  Denmark

  Finland

  Germany

  Gibraltar

  Hong Kong

  Hungary

  Italy

  Israel

  Lithuania

  Netherlands

  Norway

  Sweden

  Switzerland

  United Arab Emirates

  United States of America

  Yugoslavia

  These journeys were undertaken by the following DCTA personnel:

  Chief Executive

  Scientific Staff (Scientific Officer to Grade 6)

  Quality Assurance Staff (PTO to Grade 6)

  Product Managers (Maj/Lt Col)

  Research & Development Advisor (Grade 7)

  Letter from Peter Trevelyan to Mr. Martin Redmond, dated 29 November 1995:

  You asked the Secretary of State for Defence for details of expenditure by Executive Agencies for the last Financial Year in respect of overseas travel by agency staff. I am replying on behalf of the Defence Accounts Agency.

  (a) Cost of travel £14,037.23

  (b) The countries visited and the posts held by the staff were as follows:

  USA

  2 Senior Executive Officers

  2 Higher Executive Officers

  Germany

  2 Senior Executive Officers

  2 Higher Executive Officers

  Administrative Officer

  United Arab Emirates

  1 Higher Executive Officer

  1 Executive Officer

  France

  1 Higher Executive Officer

  Cyprus

  1 Higher Executive Officer

  1 Executive Officer

  1 Administrative Officer

  Holland

  2 Executive Officers (Information Technology)

  761

  Malta

  1 Grade 6

  1 Senior Executive Officer

  1 Higher Executive Officer

  Letter from Richard Kyle to Mr. Martin Redmond, dated 28 November 1995:
  You asked the Secretary of State for Defence for details of overseas travel by agency staff. I have been asked to reply as the Chief Executive of the Royal Air Force Maintenance Group Defence Agency.
  I regret that the information you request is not readily available in the form required. The vast majority of journeys carried out by the Royal Air Force Maintenance Group Defence Agency personnel involved the distribution of Service Freight and the maintenance of equipment located overseas. The cost of travel for the last financial year was £699,652. The countries visited during the period are listed as an attachment to this letter. Unfortunately, details of specific posts held by staff are not readily available.
  I hope that this information is helpful to you.
  LIST OF COUNTRIES VISITED BY STAFF IN THE MAINTENANCE GROUP DEFENCE AGENCIES DURING FINANCIAL YEAR 1994–95

  Belgium

  Canada

  Cyprus

  Denmark

  Eire

  Falkland Islands

  France

  Germany

  Gibraltar

  Hong Kong

  Italy

  Luxembourg

  Netherlands

  Norway

  Portugal

  S Africa

  Turkey

  USA.

  Letter from Peter Ayee to Mr. Martin Redmond, dated 29 November 1995:
  I write as Chief Executive of the Royal Air Force Signals Engineering Establishment (RAFSEE) Defence Agency in response to your Parliamentary Question, No 9363 of 23 November 1995, to the Secretary of State for Defence.
  The role of the Agency is to design, install and recover ground signals systems and selected airborne equipment for its operational customers in the UK and overseas. In carrying out these tasks, RAFSEE design and installation staff visited locations in Germany, Cyprus, USA, Belgium, Dubai and Gibraltar on a total of 52 occasions in the period between Agency launch on 22 November 1994 and the end of the Financial Year. The total cost was £54,253.

  Letter from John Clarke to Mr. Martin Redmond, dated 29 November 1995:
  The Secretary of State for Defence has asked me to reply to your Parliamentary Question, about details of overseas travel by Agency staff during the last financial year, in my capacity as Chief Executive of the Naval Recruiting and Training Agency.
  You will wish to be aware that the Naval Recruiting and Training Agency (NRTA) came into being on 1 April 1995 and, as such, was not an executive agency during the period of the last financial year.
  762
  Letter from Brian Raine to Mr. Martin Redmond, dated 29 November 1995:
  The Secretary of State for Defence has asked me to reply to your Parliamentary Question about overseas travel by Agency staff.
  Our Bursar did travel to Halifax, Nova Scotia Canada in order to reconnoitre the situation at the International Tattoo in Halifax in preparation for our Pipe Band going there in June 1995. The cost of the trip was £609.20.

  Letter from W. E. Spreadbury to Mr. Martin Redmond, dated 29 November 1995:
  In the absence of the Chief Executive on duty, I am replying to your enquiry concerning overseas travel by agency staff.
  The details you requested are:-

  (a) £2,185

  (b) Germany, for Rhine Army Show

  (c) Headmaster, Publicity Officer and four pupils.

  Letter from J. M. Powell to Mr. Martin Redmond, dated 29 November 1995:

  1. I have been asked by the Secretary of State for Defence to reply to your Parliamentary Question.

  2. The specific answers are as follows:

  (a) The costs of travel during FY 1994/95 were £155,946.

  (b) Travel in Europe related solely to training and the management of schools within SCS (NWE) in Germany, Belgium, the Netherlands and Italy. In addition one visit was made to service schools in Cyprus.

  (c) The posts held by staff travelling were:

  i. travel in Germany was by all staff of SCS (NWE).

  ii. travel elsewhere was by the Chief Executive, three Assistant Chief Executives, the Budget manager, Finance manager, Personnel manager, Contracts manager, members of their staff, Headteachers and members of the Inspection Advisory Service.

  3. However, it must be appreciated that the Service Children's Schools (North West Europe) Agency with its Headquarters in Rheindahlen Germany is concerned with the operation of service schools in North West Europe, where 80% of service families posted overseas are stationed. Therefore whilst all travel undertaken by Agency staff is "overseas" this represents no more than the normal discharge of duties; The only exception was a four day liaison visit to Cyprus by the Chief Executive.

  4. If you require any further information or clarification please contact this Headquarters.

  Letter from Paul Altobell to Mr. Martin Redmond, dated 29 November 1995:

  The Secretary of State has asked me to reply to your question about Next Steps Agencies and how this relates to my Agencies.

  The responses to your questions in the order put to me are:

  In the last financial year DASA spent £547 on overseas travel.

  The country visited was France.

  The trip was for one Grade 6.

  Letter from Keith Ellender to Mr. Martin Redmond, dated 29 November 1995:

  I am replying on behalf of the Disposal Sales Agency to your question to the Secretary of State for Defence about overseas travel.

  The information in respect of my Agency is as follows:

  Costs: The overall costs amounted to £97,198.09.

  Countries Visited: Austria, Brazil, Cyprus, Germany, Gibraltar, India, Lebanonn, Pakistan, Spain, Switzerland, USA.

  Posts Held: Chief Executive

  Assistant Director (Germany)

  Assistant Director (Plans & Budget)

  Disposal Sales (Health & Safety)

  763

  Disposal Sales (Marketing Agreements)

  Assistant Director (Ships & Armaments)

  Disposal Sales (Ships)

  Disposal Sales (Armaments)

  Royal Navy Liaison Officer

  Royal Navy Liaison Officer—(Helicopters)

  Letter from John May to Mr. Martin Redmond, dated 29 November 1995:
  Your Parliamentary Question to the Secretary of State for Defence on overseas travel by the staff of executive agencies during the last financial year has nevertheless been passed to me to answer in respect of the Royal Air Force Training Group Defence Agency.
  The breakdown of the information you ask for is not collected centrally within the Agency or by any other branch of the Royal Air Force. The cost of any trawl to determine the statistics you require would take extensive and un-resourced clerical effort, at a cost that would substantially outweigh any benefit arising from the answer. Nor have we any plans for our future financial and management accounting systems to access discrete data of this nature. It is a principle of good business management that authorization of and accounting for overseas travel should be delegated to the lowest proper level and accommodated within overall travel and subsistence budgets. 1 therefor regret that I am unable to help you further.
  I am sending a copy of this letter to the Agency's owner, the Air Officer Commanding-in-Chief Personnel & Training Command.

  Letter from 1. A. Lumsden to Mr. Martin Redmond, dated 29 November 1995:
  The Secretary of State for Defence has asked the Chief Executive to reply to your Parliamentary Question regarding details of overseas travel in the year 1994–95. The Chief Executive is absent on leave and I am standing in for him.
  During this period no official overseas travel was undertaken by any civilian members of the Defence Animal Centre. Service personnel travelled to normal service destinations as part of their duties. To obtain further detail on military travel would, however, be disproportionately costly if indeed it were possible.

  Letter from John Chisholm to Mr. Martin Redmond, dated 29 November 1995:
  I have been asked to respond on behalf of the Defence Evaluation and Research Agency (DERA) to your Parliamentary Question to the Secretary of State for Defence about overseas travel by agency staff.
  DERA does not hold centrally information about the overseas travel of our staff and I regret this could only be collected at disproportionate cost. 1 should explain that the Agency, which employs over 12,000 staff at over 50 sites in the UK, is organised into five operating divisions. These, in turn, consist of Business Sectors each of which has been delegated considerable managerial and financial freedoms to conduct their affairs in response to customer requirements. Overseas travel is one of the areas which has been delegated and our local managers have the authority to employ a variety of means to make cost effective travel arrangements. It would be disproportionately costly to seek details of all overseas travel by all DERA staff over the last year in these circumstances.
  I am sorry that I could not be more helpful on this occasion.

  Letter from Tweedie McBrown to Mr. Martin Redmond, dated 29 November 1995:
  Your Parliamentary Question to the Secretary of State for Defence, PQ 2288, concerning overseas travel by Defence Agency staff has ben passed to me. As Head of the Defence Postal & Courier Services Agency (DPCSA), I have been asked to reply on behalf of the Secretary of State in respect of travel by staff from within my Agency.
  764
  The DPCSA exists to provide a postal and courier service to MoD/Service establishments in the UK and throughout the rest of the world. My Agency also undertakes work on behalf of other Government Departments, particularly the Foreign & Commonwealth Office. In fulfilling our role we therefore send significant number of staff abroad on a regular basis.
  During FY 1994/95 the Agency spent £638k on civil airline and RAF transport costs. In addition, foreign accommodation and subsistence amounted to £79k.
  The Courier Service operates scheduled delivery services for classified material to most countries in which HM Forces personnel are serving, and to HM Ships wherever they operates. We also provide non-scheduled special services when the need arises. The Postal Service operates a scheduled service for non-classified mail to HM Forces serving throughout the world, including HM Ships and UN Forces in locations such as Bosnia.
  Almost all of the foreign travel & accommodation costs relate to Defence Couriers. These are civilian (ex military) staff employed for the sole purpose of providing the courier service. Military staff from the Agency were also sent abroad to support military operations, particularly in Bosnia. Overseas travel by senior Agency staff is limited to visiting British Forces Post Offices (BFPOs) and other military facilities and is infrequent.
  I hope you find this information helpful. Should you require any further information please let me know.

  Letter from J. C. R. Hunt to Mr. Martin Redmond, dated 29 November 1995:
  I have been asked to respond to your recent question to the Defence Secretary concerning overseas travel by executive agency staff.In 1994–95 the cost of overseas civil air travel and subsistence for Meteorological Office staff is estimated to have been some £560,000. The costs were incurred in pursuit of the Meteorological Office's role as a member of the international meteorological community.
  The countries visited were:

  Africa

  South America

  Ascension

  New Zealand

  Belgium

  Denmark

  Norway

  France

  Switzerland

  Holland

  Italy

  Spain

  Poland

  Middle East

  North America

  Canada

  Australia

  Austria

  Cyprus

  Finland

  Sweden

  Germany

  Gibraltar

  Ireland

  Portugal

  Hungary

  Russia

  Far East

  765
  Unfortunately information on the posts held by the staff concerned is not available.

  I am sorry that I am unable to reply fully to your question but I hope the information I have given will be of help.

  Correspondence
  Dr. Lynne Jones
  To ask the Secretary of State for Defence when he intends to write to the hon. Member for Birmingham, Selly Oak giving the information requested on the cost of ministeral transport in each of the past five years, on allowances paid to Ministers who use their own vehicles and on the cost in each of the past five years as undertaken on 3 November,Official Report, column 476.

  Mr. Arbuthnot
  I wrote to the hon. Member yesterday.

  Indonesian Armed Forces (Training)
  Mr. Battle
  To ask the Secretary of State for Defence how many members of the Indonesian armed forces have received training at United Kingdom armed forces institutions in each year since 1983. [3138]

  Mr. Soames
  The UK has provided training for Indonesian students during this period. Details of training, including the numbers involved, are, however, regarded as confidential between Governments.

  Anti-tank Mines
  Mr. Forman
  To ask the Secretary of State for Defence what plans he has to enhance the Army's anti-tank mine capability; and if he will make a statement. [3609]

  Mr. Arbuthnot
  I have agreed to the procurement of 29 vehicle-launched scatterable mine systems from Alliant Techsystems of the United States, subject to the satisfactory conclusion of a contract. VLSMS will provide the Army with a key capability to lay anti-tank minefields at short notice in support of armoured formations. This decision will result in work equivalent to around half the value of the contract being undertaken by UK firms as part of the industrial participation arrangements of the programme, including work for Alvis, which makes the Stormer carrier vehicle.

  Equipment Programmes
  Dr. David Clark
  To ask the Secretary of State for Defence what will be the effect on in-service dates for each major equipment programme listed in tables 3, 4 and 5 of the "Statement on the Defence Estimates 1995" of the Budget settlement for defence. [2271]

  Mr. Arbuthnot
  The settlement provides the resources necessary to maintain and enhance the front-line capabilities of the armed forces, and to provide the support they need to carry out their wide range of tasks.

  Army Surgeons
  Dr. David Clark
  To ask the Secretary of State for Defence what is the number of regular Army surgeons employed by his Department in each of the last five years. [2054]
  766
  Mr. Soames
  [holding answer 23 November 1995]: The number of trained specialist, senior specialist and consultant regular Army surgeons, comprising the disciplines of general surgery, ophthalmics, burns and plastics, maxillo-facial, orthopaedics and ear-nose-throat—oto-rhino-laryngology— employed during each of the last four years is as follows:

  1995: 54

  1994: 61

  1993: 63

  1992: 61.

  The grade of specialist is not deployable to meet the war commitment for surgeons. Figures are not available for 1991.

  "Partnership for Peace"
  Mr. David Atkinson
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assistance is being given to Russian officers on the civic education in a democracy and human rights in the armed services under NATO's "Partnership for Peace" programme; and if he will make a statement. [2768]

  Mr. Soames
  I have been asked to reply.

  One of the main objectives of "Partnership for Peace" is to ensure democratic control of the armed forces. Russia has indicated interest, through their individual partnership programme in the following related areas:

  Civil democratic control over the armed forces.

  Role and functions of the armed forces in a democratic society.

  Legislation concerning the armed forces in a democratic society.

  Relations between the military and civilians in a democratic society.

  Implementation of Russia's IPP has not yet commenced.

  The United Kingdom is, however, undertaking bilateral initiatives in this area. As part of our Outreach programme, a seminar, "Armed Forces and Society", is to be held in London from 12 to 14 December. Representatives from the Russian Ministry of Defence are expected to attend.

HOME DEPARTMENT

  Transsexuals
  Mr. Alex Carlile
  To ask the Secretary of State for the Home Department what plans he has to introduce legislation to allow a change in the legal status of post-operative transsexuals; and if he will make a statement. [2351]

  Mr. Kirkhope
  None.
  767

  Ticket Touting
  Mr. Alex Carlile
  To ask the Secretary of State for the Home Department what is his estimate of the value of the ticket touting market; and if he will make a statement. [2353]

  Mr. Maclean
  My Department has no such estimate.

  Juries
  Mr. Alex Carlile
  To ask the Secretary for the Home Department what measures are in place to ensure that juries represent the social mix in the United Kingdom; and if he will make a statement. [2350]

  Mr. Maclean
  It is a fundamental principle of our jury system that juries should as far as possible represent a cross-section of society drawn at random from the community as a whole. Any person between the ages of 18 and 70 is eligible to serve on a jury, unless they are disqualified in one of a number of specified ways.

  Passports
  Mr. Gordon Prentice
  To ask the Secretary of State for the Home Department what progress has been made on the introduction of machine-readable passports. [2917]

  Mr. Kirkhope
  The phased introduction of the machine-readable passport commenced in 1988 and was completed in 1991. Since then, all passports issued in the United Kingdom have been machine-readable.

  Prisons
  Mr. Alex Carlile
  To ask the Secretary of State for the Home Department what was the capacity of United Kingdom prisons, per category and in total, for each of the last five years for which figures are available; and if he will make a statement. [2343]

  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.

  Table 2: Certified normal accommodation in use on 30 June by Security Category, 1990–1994

  Certified normal accommodation in use

  Security standard of accommodation

  1990

  1991

  1992

  1993

  1994

  Closed Training Prisons (including Dispersal prisons)

  Category A, B and C

  17,073

  18,602

  19,487

  19,210

  19,206

  Local Prisons and Remand Centres

  Category B

  13,593

  13,823

  15,565

  16,206

  18,103

  Open Training Prisons

  Category D

  3,496

  3,434

  3,674

  3,581

  3,745

  Female Prisons (Closed and Open)

  —

  1,773

  1,776

  1,765

  1,782

  1,863

  All Young Offender Institutions

  —

  6,869

  6,240

  5,748

  5,867

  5,374

  Total

  42,804

  43,875

  46,239

  46,646

  48,291

  1994 Statistics are due to be published in January 1996.

  Mr. Carlile
  To ask the Secretary of State for the Home Department what is the latest figure for the population in custody, per category and in total; and if he will make a statement. [2344]
  768
  Letter from Alan Walker to Mr. Alex Carlile, dated 29 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 capacity of United Kingdom prisons, by category and in total for each of the last five years for which figures are available.
  Prisons in England and Wales are defined by operational function and an establishment will have, according to its particular function, accommodation designed for holding prisoners up to a particular security category.
  Information on the security standard of accommodation available on 23 November 1995 at closed and open training prisons and local prisons in England and Wales is given in table one, attached.
  The only information available for the previous five years (1990–95) is that published annually in "Prisons Statistics, England and Wales". This information is given in table two.

  Table 1: Certified normal accommodation for use in prisons in England and Wales by Security Category and in total on 23 November 1995

  Security standard of accommodation

  Certified normal accommodation in use

  Closed Training Prisons (Dispersals)

  Category A

  3,698

  Belmarsh Prison

  Category A

  48

  Category A unit

  Other Closed Training

  Category B

  3,022

  Prisons

  Category C

  14,414

  Local Prisons and Remand Centres

  Category B

  18,606

  Open Training Prisons

  Category D

  3,893

  Closed Female Prisons

  —

  1,520

  Open Female Prisons

  —

  593

  Closed Young Offender Institutions

  —

  4,052

  Open Young Offender Institutions

  —

  1,482

  Total

  51,328

  Notes:

  1. Some of the more secure local prisons also hold Category A prisoners as and when necessary. A formal maximum number of places for this purpose is not designated.

  2. With the exception of those categorised A, convicted and sentenced female prisoners and young offenders are not normally categorised, but are allocated to open or closed conditions.

  3. There are currently only three sentenced Category A female prisoners. All are held at Durham Prison.

  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.
  769
  Letter from Richard Tilt to Mr. Alex Carlile, dated 29 November 1995:
  The Home Secretary has asked me to reply to your recent Question about the latest prison population figure by category of prisoner and in total.

  The information requested is given in the attached table.

  Number of prisoners held in England and Wales on 23 November 1995 by category and in total

  Number

  Category A

  826

  Category B

  7,969

  Category C

  17,529

  Category D

  2,926

  Uncategorised or awaiting categorisation

  23,161

  Total

  52,411

  1. Female prisoners and young offenders are only given a security category when category A is applicable.

  2. Unless category A is applicable, adult male prisoners are not given a security category until after conviction and sentence.

  Asylum Seekers
  Mr. Alex Carlile
  To ask the Secretary of State for the Home Department (1) what is the average waiting time for a decision to be made on an application for asylum; and if he will make a statement; [2345]

  (2) what is the average waiting time between an initial rejection of an application for asylum and the hearing of an appeal; and if he will make a statement. [2346]

  Ms Janet Anderson
  To ask the Secretary of State for the Home Department if he will make a statement on the speed with which asylum applications are processed. [1676]

  Mr. Kirkhope
  I refer the hon. Members to the reply given to a question from the hon. Member for Newcastle Upon Tyne, North (Mr. Henderson) on 22 November,Official Report, column 219, which gave the available information on the average times involved in deciding applications for asylum.

  Mr. Fatchett
  To ask the Secretary of State for the Home Department what estimate he has made of the number of visitors and short-term students who have overstayed in the United Kingdom in each year since 1990 or asked for political asylum; and if he will name the country from which these people came. [2834]

  Mr. Kirkhope
  Information on the number of visitors and students who have overstayed in the United Kingdom is not available. The estimated proportion of asylum-seekers since 1990 who had entered the United Kingdom in another capacity before submitting their asylum application is given in the table. A nationality breakdown of these figures is not available.

  Proportion of in-country1 asylum applicants who had been granted leave in another capacity2 before applying for asylum

  Number of in-country applications

  Of which proportion submitted

  Year

  In-time Percentage

  Out of time Percentage

  Other3 Percentage

  1990

  17,200

  45

  9

  46

  1991

  35,815

  32

  5

  63

  1992

  22,370

  53

  13

  34

  770

  Proportion of in-country1 asylum applicants who had been granted leave in another capacity2 before applying for asylum

  Number of in-country applications

  Of which proportion submitted

  Year

  In-time Percentage

  Out of time Percentage

  Other3 Percentage

  1993

  15,050

  43

  18

  39

  1994

  22,600

  36

  17

  47

  1 Applications submitted after entry into the United Kingdom.

  2 Include those granted leave to enter or remain in other capacities as well as visitors and students.

  3 Includes illegal entrants and those whose status was unknown.

  Mr. Henderson
  To ask the Secretary of State for the Home Department if he will list the European countries which operate special asylum procedures to deal with cases where the applicant is a national of a country in which there is no serious risk of persecution. [550]

  Mr. Kirkhope
  I refer the hon. Member to the reply given to him on 22 November,Official Report, column 220.

  Mr. Beith
  To ask the Secretary of State for the Home Department how many asylum seekers are currently being held in detention in police stations; what is the length of time of their detention(a) in police stations (b) in total; and if he will present this information according to the nationality of the asylum seekers. [1524]

  Mr. Kirkhope
  [holding answer 23 November 1995]: As at 21 November 1995, 14 people who had sought asylum were being detained in police cells. Of these, five are Nigerians and four are Algerians.

  The longest period of time that any of these people have been detained in a police cell is seven nights. This is the maximum time that a person who has claimed asylum can be detained in police cells if removal directions have been set. If removal directions have not been set, a person can be detained for up to five nights.

  Refugees
  Mr. Alex Carlile
  To ask the Secretary of State for the Home Department if he will make it his policy to ensure that his proposals for reform of asylum and immigration rules do not contradict commitments made under the 1951 United Nations refugee convention; and if he will make a statement. [2347]

  Miss Widdecombe
  As my right hon. and learned Friend made clear in his statement to the House on 20 November, all our proposals for further measures are consistent with our international obligations under the 1951 United Nations convention relating to the status of refugees.

  Extradition
  Mr. Barnes
  To ask the Secretary of State for the Home Department if he has received extradition requests from the Italian Government in respect of Roberto Fiore and Massimo Morsello. [2550]

  Mr. Kirkhope
  It is not Government policy to confirm or deny the existence of extradition requests from foreign Governments, unless they are already made public, for example, following court proceedings. Italian requests for the extradition of Roberto Fiore and Massimo Morsello
  771
  failed in 1982 when the courts found an insufficiency of evidence under the prima facie case standard which then applied. Since 1991 a lesser standard under section 7 of the Extradition Act 1989 is required in respect of such requests.

  Mr. Alton
  To ask the Secretary of State for the Home Department what assessment his Department has made of the prosecution of Bengt Bolin under Sweden's extra-territorial jurisdiction for child sex offences; and what plans he has to introduce equivalent extra-territorial laws in the United Kingdom. [2578]

  Mr. Maclean
  We have not yet received all the information we need from the Swedish authorities to make a full assessment of whether the evidence used in the Bolin case would have satisfied the normal requirements of a United Kingdom court.

  However, if a British national had committed a similar offence abroad we, unlike the Swedes who do not extradite their nationals, would have been able to return him to stand trial in the place where he was alleged to have offended. We believe that extradition in these cases is a more appropriate response, and we have no current plans to extend our jurisdiction to enable us to deal in this country with offences committed abroad. We do, however, keep this matter under review.

  Entry Clearances
  Mr. Fatchett
  To ask the Secretary of State for the Home Department how many applications to enter the United Kingdom for temporary purposes have been made in each year since 1992; how many have been refused; and if he will list the refusal rate for each year expressed as a percentage of the whole. [2835]

  Mr. Kirkhope
  The information requested is given in the following table.

  Applications for entry clearance for temporary purposes, United Kingdom 1992–94

  Numbers and percentages

  1992

  1993

  1994

  New applications

  903,020

  955,440

  1,086,940

  Granted1

  803,520

  861,810

  980,600

  Initial refusals

  67,830

  60,100

  64,420

  Initial refusal rate2

  7.8 per cent.

  6.5 per cent.

  6.2 per cent.

  1 Includes granted initially and granted on appeal.

  2 Calculated as the number of initial refusals as a proportion of total decisions.

  Criminal Injuries Compensation Scheme
  Mr. Matthew Taylor
  To ask the Secretary of State for the Home Department what assessment he has made of the time taken for claims to be processed under the

  Table A: Number of persons aged 10 to under 18 years cautioned by type of offence1 and region, 1979, 1984, 1989, 1992, 1993 and 1994

  Region

  Offence

  19792

  1984

  1989

  1992

  1993

  1994

  North

  Indictable

  —

  8,256

  6,845

  7,856

  7,476

  7,993

  Summary non motoring

  —

  1,466

  2,744

  2,691

  2,670

  2,992

  Total

  —

  9,722

  9,589

  10,547

  align="right"10,146

  10,985

  772
  criminal injuries compensation scheme; and if he will make a statement. [3144]

  Mr. Maclean
  The Criminal Injuries Compensation Board does not record centrally fully comprehensive information about the time taken to process applications. However, some information about the time taken for the board to reach decisions on cases and the time taken to resolve hearings is given at paragraphs 3.12 and 4.14 of the board's 30th annual report (CM 2849), copies of which are held in the Library.

  This shows that the board's performance in processing cases has been improving. But as we have made clear, we believe that a scheme which is based on common law damages is inherently incapable of providing the level of service which claimants are entitled to expect. That is why we plan to introduce, in April 1996, the new tariff-based scheme provided for in the Criminal Injuries Compensation Act 1995. The new scheme should be easier to understand, simpler to administer and claimants should get their money more quickly.

  Channel Islands
  Mr. Llew Smith
  To ask the Secretary of State for the Home Department if he will make a statement on the matters discussed and decisions taken at the meeting held on 17 November with political representatives and officials of the Channel Islands states and what further plans exist for future meetings. [2733]

  Mr. Kirkhope
  The meeting on 17 November was one in a regular series held at the Home Office in which United Kingdom Government officials brief political representatives, Crown officers and officials of the Channel Islands and Isle of Man on international developments of particular interest to the islands' authorities.

  The meeting discussed recent and prospective developments in the European Union, the Organisation for Economic Co-operation and Development, the World Trade Organisation, the International Labour Organisation, the Energy Charter Treaty, the external frontiers convention, identity cards and the transport and disposal of radioactive waste. At the islands' request, a further meeting, to provide additional briefing on the latter issue, is currently being arranged for early January.

  Juvenile Offenders
  Mr. Steinberg
  To ask the Secretary of State for the Home Department how many juveniles(a) received a police caution and (b) have been prosecuted for a criminal offence by region for each year since 1979. [2499]

  Mr. Maclean
  Information for 1979, 1984, 1989, 1992, 1993 and 1994 is given in the tables. The provision of data for other years would involve disproportionate costs.
  773

  Table A: Number of persons aged 10 to under 18 years cautioned by type of offence1 and region, 1979, 1984, 1989, 1992, 1993 and 1994

  Region

  Offence

  19792

  1984

  1989

  1992

  1995

  1994

  North West

  Indictable

  —

  15,237

  11,516

  15,802

  12,915

  13,159

  Summary non motoring

  —

  3,328

  4,257

  5,281

  4,774

  4,859

  Total

  —

  18,565

  15,773

  21,083

  17,689

  18,018

  Yorkshire and Humberside

  Indictable

  11,365

  11,538/

  12,893

  10,054

  10,512

  Summary non motoring

  —

  3,171

  4,288

  3,304

  2,992

  3,282

  Total

  —

  14,536

  15,826

  16,197

  13,046

  13,794

  East Midlands

  Indictable

  —

  8,758

  7,026

  8,409

  7,731

  7,814

  Summary non motoring

  —

  2,241

  2,672

  2,000

  2,224

  2,143

  Total

  —

  10,999

  9,698

  10,409

  9,955

  9,957

  West Midlands

  Indictable

  —

  12,874

  10,928

  11,968

  10,900

  11,470

  Summary non motoring

  —

  2,259

  2,647

  2,993

  2,992

  3,011

  Total

  —

  15,133

  13,575

  14,961

  13,892

  14,481

  East Anglia

  Indictable

  —

  3,837

  2,985

  4,550

  3,605

  3,956

  Summary non motoring

  —

  991

  1,016

  1,072

  913

  985

  Total

  —

  4,828

  4,001

  5,622

  4,518

  4,941

  South East

  Indictable

  —

  28,571

  19,646

  32,001

  28,784

  28,563

  Summary non motoring

  —

  6,320

  7,516

  7,845

  7,970

  8,618

  Total

  —

  34,891

  27,162

  39,846

  36,754

  37,181

  South West

  Indictable

  —

  7,830

  4,937

  6,369

  6,865

  7,201

  Summary non motoring

  —

  1,980

  1,397

  1,305

  1,379

  1,602

  Total

  —

  9,810

  6,334

  7,674

  8,244

  8,803

  Wales

  Indictable

  —

  5,280

  4,940

  5,775

  5,733

  4,819

  Summary non motoring

  —

  1,795

  1,899

  1,578

  1,605

  1,675

  Total

  —

  7,075

  6,839

  7,353

  7,338

  6,494

  England and Wales

  Indictable

  —

  102,008

  80,361

  105,623

  94,063

  95,487

  Summary non motoring

  —

  23,551

  28,436

  28,069

  27,519

  29,167

  Total

  125,559

  108,797

  133,692

  121,582

  124,654

  1 A number of indictable offences were reclassified as summary on October 1988 following the Criminal Justice Act 1988.

  2 Not available.

  Table B: Number of persons aged 10 to under 18 years prosecuted at magistrates' courts by type of offence1 and region, 1979, 1984, 1989, 1992, 1993 and 1994

  Region

  Offence

  1979

  1984

  1989

  1992

  1993

  1994

  North

  Indictable

  9,615

  9,694

  5,454

  6,131

  6,208

  6,919

  Summary non motoring

  3,782

  2,999

  3,249

  2,578

  2,500

  2,730

  Total

  13,397

  12,693

  8,703

  8,709

  8,708

  9,649

  North West

  Indictable

  23,105

  20,803

  11,260

  10,170

  8,620

  10,340

  Summary non motoring

  8,337

  6,031

  5,622

  4,058

  3,182

  3,620

  Total

  31,442

  26,834

  16,882

  14,228

  11,802

  13,960

  774

  775

  Table B: Number of persons aged 10 to under 18 years prosecuted at magistrates' courts by type of offence1 and region, 1979, 1984, 1989, 1992, 1993 and 1994

  Region

  Offence

  1979

  1984

  1989

  1992

  1993

  1994

  Yorkshire and Humberside

  Indictable

  15,715

  15,508

  8,026

  8,311

  8,156

  8,152

  Summary non motoring

  7,107

  4,639

  3,755

  2,843

  1,992

  2,176

  Total

  22,822

  20,147

  11,781

  11,154

  10,148

  10,328

  East Midlands

  Indictable

  8,750

  8,448

  5,438

  5,826

  5,288

  6,018

  Summary non motoring

  2,893

  2,448

  2,433

  1,982

  1,608

  1,939

  Total

  11,643

  10,896

  7,871

  7,808

  6,896

  7,957

  West Midlands

  Indictable

  11,253

  13,030

  7,649

  7,856

  7,347

  8,262

  Summary non motoring

  3,933

  3,771

  3,403

  2,486

  2,195

  2,272

  Total

  15,186

  16,801

  11,052

  10,342

  9,542

  10,534

  East Anglia

  Indictable

  3,219

  3,595

  1,814

  1,547

  1,577

  1,681

  Summary non motoring

  1,669

  1,123

  774

  473

  379

  525

  Total

  4,888

  4,718

  2,588

  2,020

  1,956

  2,206

  South East

  Indictable

  35,864

  32,596

  17,635

  214,247

  214,717

  17,620

  Summary non motoring

  10,962

  8,963

  8,233

  25,174

  24,512

  5,763

  Total

  46,826

  41,559

  25,868

  219,421

  219,229

  23,383

  South West

  Indictable

  7,182

  7,463

  4,150

  3,521

  3,315

  4,169

  Summary non motoring

  2,344

  2,409

  2,170

  1,266

  1,113

  1,287

  Total

  9,526

  9,872

  6,320

  4,787

  4,428

  5,456

  Wales

  Indictable

  7,933

  7,672

  4,667

  4,551

  4,564

  35,324

  Summary non motoring

  3,137

  2,405

  2,574

  1,979

  1,475

  31,845

  Total

  11,070

  10,077

  7,241

  6,530

  6,039

  37,169

  England and Wales

  Indictable

  122,636

  118,809

  66,093

  262,160

  259,792

  368,485

  Summary non motoring

  44,164

  34,788

  32,213

  222,839

  218,956

  322,157

  Total

  166,800

  153,597

  98,306

  284,999

  278,748

  390,642

  1 A number of indictable offences were reclassified as summary on October 1988 following the Criminal Justice Act 1988.

  2 Improvements in the data collection methods used by the Metropolitan Police have lead to increases in the numbers proceeded against in 1992 and 1993.

  3 Missing data for South Wales lead to a small decrease in the number of summary offences recorded.

  Community Policing
  Mr. Jim Cunningham
  To ask the Secretary of State for the Home Department if he will make a statement on community policing in rural areas. [2649]

  Mr. Maclean
  Police operations in rural areas are a matter for individual chief officers of police. The Government encourage a partnership approach to policing, and we are aware of a number of successful local initiatives in rural areas, including the farm watch and horse watch schemes, which involve a close partnership between the police and rural communities. In addition, the Government have introduced the parish constable scheme which is being taken up in many rural areas.
  776

  Prisoners
  Mr. Redmond
  To ask the Secretary of State for the Home Department how many(a) sentenced and (b) remand prisoners were held at Doncaster prison on the 17th day of each of the last 12 months. [2397]

  Miss Widdercombe
  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. Martin Redmond, dated 29 November 1995:
  The Home Secretary has asked me to reply to your recent Question about how many (a) sentenced and (b) remand prisoners were held at Doncaster prison on the 17th day of each of the last twelve months.
  The information requested is given in the table.

  777

  Number of sentenced and remand prisoners held at Her Majesty's Prison Doncaster during the last 12 months

  Sentenced

  Remand

  17 December 1994

  345

  383

  17 January 1995

  386

  388

  17 February 1995

  375

  381

  17 March 1995

  363

  394

  17 April 1995

  360

  365

  17 May 1995

  416

  340

  17 June 1995

  404

  326

  17 July 1995

  417

  332

  17 August 1995

  416

  361

  17 September 1995

  386

  362

  17 October 1995

  414

  361

  17 November 1995

  444

  333

  Ms Janet Anderson
  To ask the Secretary of State for the Home Department what is his estimate of(a) the number of prison places that will be available by 1 January 1996 and (b) the number of convicted and remand prisoners being held by that date. [1681]

  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 29 November 1995:
  The Home Secretary has asked me to reply to your recent Question about the number of prison places that will be available by 1 January 1996 and the estimated number of convicted and remand prisoners being held by that date.
  The Certified Normal Accommodation available for use in prisons in England and Wales on 23 November 1995 was 51,328. Approximately 140 additional places are expected to be available, following modernisation and refurbishment, by 1 January 1996.
  The latest short-term projection (produced in October) indicates that the prison population at the end of December 1995 will be around 50,000, due to the seasonal downturn at the end of the year. Remand prisoners are assumed to be just over 10,000, sentenced prisoners around 39,000 and non-criminal prisoners around 600.

  Doncaster Prison
  Mr. Redmond
  To ask the Secretary of State for the Home Department if he will make it his policy to ensure that Premier Prison Services Ltd. recognises trade unions in managing Doncaster prison; and if he will make a statement. [2396]

  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. Martin Redmond, dated 29 November 1995:
  The Home Secretary has asked me to reply to your recent Question about trade union recognition at Doncaster prison.
  Whether or not a trade union is recognised at a contracted out prison is a matter for the contractor. The contractor at Doncaster prison, Premier Prison Services Ltd., has decided not to recognise a trade union to represent staff.
  Doncaster prison has a fully constituted Works' Council which represents all the staff t the prison.
  778

  Prison Service
  Ms Janet Anderson
  To ask the Secretary of State for the Home Department if he will make a statement on the management of the Prison Service. [1699]

  Miss Widdecombe
  My right hon. and learned Friend made a statement on 16 October 1995 about the report by General Sir John Learmont which made a number of recommendations about the management of the Prison Service. He has undertaken to come back to the House with a full response to those recommendations in due course. He will also take into account the results of consultation within the Prison Service on the recommendations of the senior management review.

  Prison Costs
  Ms Janet Anderson
  To ask the Secretary of State for the Home Department, (1) by what amount he expects the cost of prisons to exceed the amount budgeted for 1995–96; [1685]

  (2) what is his current estimate of the total cost of holding prisoners for 1996–97, and what was his previous estimate. [1695]

  Miss Widdecombe
  Responsibility for these matters 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 29 November 1995:
  The Home Secretary has asked me to reply to your recent Questions asking by how much the cost of prison is expected to exceed the amount budgeted for 1995–96 and what is the current estimate of the total cost of holding prisoners for 1996–97, and what was the previous estimate.
  The present provision for 1995–96 in Class VIII, Vote 2, Prisons, England and Wales is £1,660,160,000. While the financial requirements of the Prison Service are regularly monitored, it would be premature to estimate what the final requirement will be. A clearer picture of whether additional provision will be required will emerge in February 1996, at the time of the Spring Supplementary Estimates.
  An announcement on the provision available for the Prison Service in 1996–97 will be made at the same time as the Chancellor of the Exchequer's Budget speech on 28 November.

  Spending Plans
  Ms Janet Anderson
  To ask the Secretary of State for the Home Department if he will make a statement about his Department's spending plans for 1995–96, 1996–97 and 1997–98. [1680]

  Mr. Howard
  Detailed information for 1995–96 is set out in the supply estimates 1995–96 (HC271-VIII), subsequently amended by the revised estimate (HC465-VIII) and the winter supplementary estimate (HC4-VIII). Copies of these are available in the Library. My right hon. and learned Friend the Chancellor of the Exchequer announced the Government's latest plans for the following years in his statement yesterday.

  Sunday Dancing
  Mr. Simon Coombs
  To ask the Secretary of State for the Home Department what proposals he has to deregulate Sunday dancing. [54]
  779
  Mr. Kirkhope
  We are considering how to proceed in the light of the reports of the Deregulation Committee and the House of Lords Delegated Powers Scrutiny Committee on our draft Deregulation (Sunday Dancing) Order.

  Bull Bars
  Dr. Marek
  To ask the Secretary of State for the Home Department if he will give instructions to remove bull bars from all police road cars and passenger transit vans. [2881]

  Mr. Maclean
  [holding answer 28 November 1995]: The equipment fitted to police vehicles is the responsibility of individual chief officers. The police are aware of the concerns about the use of bull bars and in June of this year the Association of Chief Police Officers' Traffic committee invited all chief officers to consider removing bull bars from their vehicles, where so equipped.

  Table 1 Persons prosecuted in magistrates' courts in England and Wales for offences1 under Section 24(l)(b)(ii) of the Immigration Act 1971, 1990–94

  Prosecutions

  Proceedings terminated early2

  Committed for trial3

  Found guilty

  Found guilty

  Total

  Of whom

  Fined

  Immediate custody

  1990

  76

  14

  5

  55

  30

  2

  2

  1991

  41

  10

  —

  28

  17

  2

  3

  1992

  28

  8

  1

  17

  12

  1

  2

  1993

  13

  7

  —

  6

  4

  1

  —

  1994

  12

  9

  —

  3

  2

  —

  —

  1 Principal immigration offence.

  2 Including cases discontinued or "written off".

  3 At a Crown Court.

  4 Charge dismissed.

  Table 2: Persons removed1 from United Kingdom under enforcement powers

  1990

  4,280

  1991

  5,804

  1992

  6,214

  1993

  6,076

  1994

  5,077

  1995 January to June2

  2,345

  1 Including 'voluntary' departures after enforcement action was initiated.

  2 Provisional figure.

  Illegal Employment
  Mr. Madden
  To ask the Secretary of State for the Home Department how many staff in his Department are dedicated to detecting illegal employment; where those staff are based; how those staff routinely operate; and to what extent those staff co-operate with the police. [2761]

  Mr. Kirkhope
  [holding answer 28 November 1995]: No staff are dedicated specifically to detecting illegal employment. This task is part of the role performed principally by some 247 operational immigration staff employed at the main immigration service enforcement offices. These are located in London at the immigration
  780

  Illegal Employment
  Mr. Madden
  To ask the Secretary of State for the Home Department how many entrants to the United Kingdom have been found guilty of working illegally, how many were fined; how many were subject to a custodial sentence; how many were removed from the United Kingdom; and how many were found not guilty of any charge in each of the last five years. [2759]

  Mr. Timothy Kirkhope
  [holding answer 28 November 1995]: Information is available for 1990–94 on criminal proceedings taken against persons under section 24(l)(b)(ii) of the Immigration Act 1971—failure to observe conditions of leave, excluding overstaying and failure to report to a medical officer—and is given in table 1. Only a small proportion of persons found working in breach of conditions of leave are proceeded against in this way. The vast majority are dealt with under enforcement powers of the act and information on persons removed from the United Kingdom under these powers is given in table 2.

  service enforcement unit at Status park and at Becket house—with satellites at Stansted and Apex house, Gravesend; and at Gatwick, Manchester and Birmingham airports. Other immigration staff are engaged in enforcement work from time to time throughout the United Kingdom.

  Immigration offenders are identified by following up information from a variety of sources. The normal practice is for the information to be checked through official records with a view to ensuring that a named offender is identified before any attempt to locate him or her is made. The only exception to this "named offender" policy is where visits may be made to places of work where there is apparently reliable information that immigration offenders will be found. In these circumstances particular account is taken of whether there is a history of the premises being used by offenders.

  The immigration service works closely with the police and an immigration officer will normally be accompanied by a police officer where an arrest may be necessary. In addition, the police will seek the assistance of the immigration service where they identify a possible offender in the course of other police inquiries.
  781

TRANSPORT

  Fish Factory Inspections
  Dr. Godman
  To ask the Secretary of State for Transport how many foreign registered fish factory shops were inspected by officials of the Marine Safety Agency in each of the past four years; how many of these were judged to be inadequate; what action was taken against the masters and owners concerned; and if he will make a statement. [2041]

  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 Dr. Norman A. Godman, dated 29 November 1995:
  The Secretary of State for Transport has asked me to reply to your question about the inspection of foreign registered fish factory ships.
  In the financial years 1993–94 and 1994–95, the Marine Safety Agency (MSA) carried out 86 and 189 inspections respectively of foreign registered factory ships. To date in 1995–96, the MSA has undertaken 87 inspections of such ships.
  The inspections are carried out throughout the herring and mackerel seasons by a small team of surveyors. A report describing the defects found and the action required to be taken is left with the master. A copy is also sent to the ship's flag state for follow-up action by them. More than 50% of the fish factory ships inspected have deficiencies which would result in detention if the ships were alongside, but the majority of fish factory ships are inspected outside a port where, currently, our powers of detention do not extend. Where factory ships with serious deficiencies have entered ports in the UK, the ship has been detained until the deficiencies have been rectified. The MSA has detained 43 fish factory ships since April 1993.

  MUL 16 Minelayer
  Mr. Allason
  To ask the Secretary of State for Transport (1) what assessment he has made of(a) the threat posed to the safety of shipping and (b) the insurance status of the former Swedish minelayer known as the MUL 16 currently in Poole Harbour; [2103]

  (2) what steps have been taken to verify the registration and nationality of the MUL 16. [2101]

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

  Letter from R. M. Bradley to Mr. Rupert Allason, dated 29 November 1995:
  The Secretary of State for Transport has asked me to reply to your Questions about the former Swedish minelayer MUL 16.
  The ship was detained by surveyors from the Marine Safety Agency on 18 August 1995 at Poole Harbour. It was detained because of inadequate lifesaving, navigational and radio equipment and insufficient manning. The ship will not be allowed to go to sea until the Agency is satisfied that it is safe to do so. A ship of this type and size is not required to carry insurance and we believe no insurance is carried.
  You asked what steps have been taken to verify the registration and nationality of the "MUL 16". The MSA has attempted, unsuccessfully, to confirm registry so as to establish which maritime administration, if any, is responsible for the ship. The ship carried no document indicating registry and we believe it to be un-registered. The master claimed that application for UK registry had been made but in fact only a name has been registered and no formal application has been made.
  782

  QEII
  Mrs. Lait
  To ask the Secretary of State for Transport what remedial action has been taken following his assessment of the Marine Safety Agency's report on the QE II incident last December. [3608]

  Mr. Norris
  A report on the QE II incident has been completed by the director of operations and seafarers standards of the Marine Safety Agency. The director's report discloses serious deficiencies in the shore and ship management of the vessel by Cunard; it also identifies failings on the part of the Marine Safety Agency.

  On the instructions of the agency's chief executive the following action is being taken with Cunard;

  (a) the agency is holding discussions with Cunard's ship and shore management both to ensure that systems are in place to avoid any recurrence of the problems experienced last December and to work towards early certification under the international safety management code;

  (b) for the time being agency surveyors will continue a programme of inspections of the QE II.

  In addition, following the director's report, the agency's chief executive has instituted more stringent procedures governing the certification of passenger vessels; these will lead to much tighter control over the continuance in service of vessels on which refit work is in progress. The main changes are as follows:

  (1) the agency's surveyors have been instructed not to issue a certificate which is subject to conditions until they are satisfied that adequate steps have been taken by the ship's management and crew to apply and to enforce the conditions for the period during which they apply;

  (2) if a certificate is issued subject to special conditions, these conditions will be set down in writing and attached to the certificate, and they will be reinforced by written confirmation from the district chief surveyor to the owner or operator;

  (3) any special conditions, or an appropriate summary of them, will be displayed alongside the passenger certificate in a public area of the ship;

  (4) the agency's surveyors have been instructed that they should issue a full passenger certificate only after the completion of work needed to comply with the certificate, except in minor matters, where the surveyor may issue a certificate if he is satisfied that the work will be completed before the ship sails.

  Appropriate action has been taken in respect of the agency officials involved.

  The chief executive has also stressed to surveyors the importance of maintaining a close but objective working relationship with shipowners. All the agency's staff have been reminded of the agency rules on the acceptance of hospitality.

  The full details of the incident are set out in the MSA director's report, which has been placed in the Library of the House.

  Train Protection
  Sir Geoffrey Johnson Smith
  To ask the Secretary of State for Transport what advice he has received from the Health and Safety Commission and Railtrack on train protection strategy; and if he will make a statement. [3607]
  783
  Sir George Young
  The Health and Safety Commission has considered Railtrack's strategy for reducing the incidence of signals passed at danger, buffer stop collisions and overspeeding. Historically, such risks have accounted for less than one third of all casualties in collisions and derailments, and about 3 per cent. of total casualties on the railway, excluding trespassers and suicides.

  The Health and Safety Executive is pursuing, as a matter of priority, discussions with Railtrack and British Rail, and others as required, about action to develop and implement the wide range of measures to which they are committed in the train protection strategy. Objectives for reducing the risks in question will again be included in the annual railway group safety plan.

  Railtrack and BR are pursuing five initiatives to reduce the incidence of signals passed at danger.

  First, nine tenders were received by Railtrack for the development and pilot installation of a new train protection and warning system, and tender evaluation is proceeding to plan. This system is potentially capable of reducing risks arising from signals passed at danger, overspeeding and buffer stop collisions. The TPWS would enhance the existing automatic warning system by adding functions which would, if necessary, apply the brakes automatically on the approach to, or at, certain signals, and which could not be overridden by the driver. Trials of the TPWS will take place in 1996, and the aim is to start wider installation in 1997. The pilot trials and initial operational use will demonstrate the extent to which it is practicable to install the TPWS.

  Secondly, the current trial of a driver reminder appliance, to reduce the risk of starting against a red signal, is expected to be completed by the end of this year. Subject to the outcome of the trial, the intention is to assess the fitting of the device to all traction units operating on Railtrack's infrastructure, with a target for complete installation by the end of 1997.

  Thirdly, the existing automatic train protection installations on the Great Western and Chiltern lines should be brought into full service next year. Meanwhile, those passenger trains with ATP fitted are being run with a supervisor in support of the driver.

  Fourthly, measures to improve braking performance and driver and systems performance continue. The pilot trials of an emergency sanding device to improve rail adhesion are encouraging.

  Finally, and in the longer term, the reduction of risk arising from signals passed at danger and overspeeding is expected to come from a new primary control system consisting of radio-based cab signalling. Railtrack has invited tenders for a development contract for such a system as part of the project to modernise the west coast main line.

  Copies of the full advice from the HSC and Railtrack, and my response, have been placed in the Library of the House.

  National Air Traffic Services
  Mr. Mans
  To ask the Secretary of State for Transport what plans he has for the future of the national air traffic services. [3606]
  784
  Sir George Young
  I have now given approval in principle to a proposal by the chairman and board of the Civil Aviation Authority that their air traffic control operation should be incorporated as a wholly owned subsidiary of the CAA. This would help to clarify accountability and responsibilities and would mean that the directors of the subsidiary board would have the legal duties inherent in Companies Act status. It would achieve a greater degree of separation within the CAA between service provision and regulation and would pave the way for future privatisation, which remains the Government's longer-term objective.

  Detailed proposals for establishing the subsidiary by April 1996 are now being developed. In addition, the Civil Aviation Authority will be working with my officials and the Ministry of Defence to ensure that the integrated civil and military air traffic control service currently provided by NATS is fully safeguarded under the new arrangements.

  M4
  Mr. Tim Smith
  To ask the Secretary of State for Transport what is the status of the M4 junction 4B-8/9 widening scheme under the revised national roads programme; and if he will make a statement. [3501]

  Mr. Norris
  The scheme is one of a number identified for review to establish whether smaller-scale proposals would meet the objectives. The proposals for new all-purpose trunk roads alongside the M4 put to public consultation will not be pursued. My right hon. Friend is asking the Highways Agency to consider a range of lower-level solutions, including traffic management, and to have early and extensive consultation with local authorities about options.

  British Transport Police
  Mr. Key
  To ask the Secretary of State for Transport what provision is made for the budget of the British Transport police in the current financial year and in each of the next three financial years; and if he will make a statement. [2885]

  Mr. Watts
  The British Transport police's budget is determined by its police committee. In 1995–96, the BTP revenue budget is £101.2 million and the force will also undertake capital expenditure of some £2.4 million. The revenue budget for 1996–97 has been set at £101.2 million, and it is envisaged that the capital expenditure next year will be the same as this year. No decisions have yet been made on budgets for subsequent years.

  Mr. Key
  To ask the Secretary of State for Transport if his Department has had further discussions with the Home Office about the jurisdiction of the British Transport police; what was discussed; and what was the outcome. [2886]

  Mr. Watts
  Discussions are continuing between my Department and the Home Office about the jurisdiction of the British Transport police. The Department remains in close touch with the force's senior management over developments.
  785
  Mr. Key
  To ask the Secretary of State for Transport what is the current manpower of the British Transport police by rank; what it is forecast to be in each of the next three years; and if he will make a statement. [2888]

  Mr. Watts
  The strength of the British Transport police was 2,180 officers as at 11 November 1995. Staffing levels by rank were as follows:

  Rank

  Numbers

  Chief constable

  1

  Deputy chief constable

  1

  Assistant chief constable

  3

  Superintendents

  21

  Chief inspectors

  30

  Inspectors

  127

  Sergeants

  303

  Constables

  1,694

  Total

  2,180

  Manpower levels in future will reflect the resources available to the force. The force is currently rationalising the supervisory ranks and, where possible, increasing constable posts.

  Great Western Rail Franchise
  Mr. Dafis
  To ask the Secretary of State for Transport if he will make a statement on the selection of Resurgence Railways as preferred bidder for the Great Western franchise. [2846]

  Mr. Watts
  No. The franchising director has not announced bidders. He expects to announce the award of the Great Western franchise in December.

  Mr. Dafis
  To ask the Secretary of State for Transport what discussions he has had with the Director of Passenger Rail Franchising on matters relating to the Great Western rail franchise; what information on the bidding franchise he receives from the Director of Passenger Rail Franchising; and if he will make a statement. [2845]

  Mr. Watts
  My right hon. Friend the Secretary of State is briefed regularly by the franchising director on franchising issues including the progress being made towards offering the Great Western franchise to private sector bidders.

  "Safer Ships Cleaner Seas"
  Dr. Godman
  To ask the Secretary of State for Transport (1) if he will list the organisations and other interested parties which received and responded to the consultation paper referred to in the second paragraph on page 47 of "Safer Ships Cleaner Seas"; and if he will make a statement; [2043]

  (2) what proposals he expects to bring forward in respect of recommendation 77 of the document "Safer Ships Cleaner Seas", Cm 2560, and if he will make a statement. [2042]

  Mr. Norris
  The consultation paper referred to has not yet been published. It is hoped that this will be possible by around the end of the year. Until the consultation exercise has been carried out, we cannot say what proposals we expect to bring forward.
  786
  Dr. Godman
  To ask the Secretary of State for Transport if he will list the recommendations contained in the report "Safer Ships Cleaner Seas", Cm 2560, which(a) have been accepted, (b) have been implemented and (c) are awaiting implementation by his Department; and if he will make a statement. [2044]

  Mr. Norris
  I refer the hon. Member to the answer I gave to the hon. Member for Stoke on Trent, North (Ms Walley) on 16 October,Official Report, column 85.

  Departmental Targets
  Ms Armstrong
  To ask the Secretary of State for Transport what is the published recommended response times within which his Department is expected to reply to letters from the public. [3003]

  Mr. Norris
  The Department of Transport aims to respond to correspondence from the public within a 15-working day period. This target is published in a publicly available leaflet "Serving the Public".

  A249
  Sir Roger Moate
  To ask the Secretary of State for Transport if he will make a statement about progress with construction of the new dual carriageway for the A249 between the M2 and Kingsferry Bridge. [2438]

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

  Letter from Lawrie Haynes to Sir Roger Moate, dated 29 November 1995:
  As you know, the Minister for Railways and Roads, Mr John Watts, has asked me to reply to your recent Parliamentary Question asking the Secretary of State for Transport, if he will make a statement about progress with construction of the new dual carriageway for the A249 between the M2 and Kingsferry Bridge.
  I am afraid that unforeseen ground conditions have meant delays to this scheme. Because of the delay to the contractors programme, laying of the concrete pavement which we had expected to be substantially completed by now has to be suspended over Winter, but work will re-start next Spring when the weather permits. But most of the diversion of statutory undertakers equipment is now complete and good progress is being made on the Key Street Underpass; the earthworks have also been completed. We expect the scheme to be completed later next year.

  Rail Users' Consultative Committee
  Mr. Chris Davies
  To ask the Secretary of State for Transport how many applications for the post of chairman of the Rail Users' Consultative Committee his Department has received; what are the criteria for selection; and when he will announce the appointment. [2125]

  Mr. Watts
  Some 147 applications for the post of chairman of the Rail Users' Consultative Committee were received in response to the advertisement published in March. An additional 235 applications were received in response to the further advertisement published in September. The advertisements made clear to applicants the criteria needed for the post. An example of the advertisements is held in the House Library. Shortlisted applicants will be interviewed shortly and my right hon. Friend the Secretary of State expects to announce the appointment of the new chairman early in 1996.
  787

  Pleasure Craft
  Mr. Dover
  To ask the Secretary of State for Transport what plans he has to introduce safety regulations relating to leisure craft following the deaths in Lyme bay. [2291]

  Mr. Norris
  [holding answer 24 November 1995]: The Government have no plans to introduce national legislation for the compulsory regulation or registration of pleasure craft. The national marine safety steering committee concluded that a satisfactory system would be prohibitively difficult to devise and enforce. However, on behalf of my right hon. Friend the Secretary of State for Education and Employment, the Health and Safety Commission is currently consulting interested parties on proposed regulations to implement the Activity Centres (Young Persons' Safety) Act 1995. The proposals would introduce a licensing scheme for certain adventure activity providers, including those using canoes and most sailing craft.

FOREIGN AND COMMONWEALTH AFFAIRS

  European Intergovernmental Conference
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the deliberations of the reflections group as part of the process leading up to the European intergovernmental conference in 1996. [875]

  Mr. David Davis
  I refer the hon. Member to the answer I gave in the House today to the hon. Member for Neath (Mr. Hain).

  Ms Rachel Squire
  To ask the Secretary of State for Foreign and Commonwealth Affairs what discussions he has had with the Foreign Ministers of the other European Union countries about the preparations for the 1996 intergovernmental conference. [863]

  Mr. David Davis
  I frequently meet my European counterparts to discuss a wide range of topics, including the intergovernmental conference.

  BBC World Service
  Mr. Harris
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the future funding of the BBC World Service. [878]

  Mr. Hanley
  I refer the hon. Member to the answer my right hon. and learned Friend the Foreign Secretary gave to the hon. Member for Swansea, East, Mr. Anderson in the House today.

  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to change the present three-year funding agreement with the BBC World Service. [2270]

  Mr. Hanley
  The triennium system for the World Service was instituted 10 years ago to bring it in line with the rest of the BBC. Since then there have been many changes in the management of public sector finances. We are exploring modifications to the system with the World Service. There can be no absolute guarantee of fixed funding for three years for any publicly funded organisation.
  788
  Mr. Dykes
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the input of satellite technology deployment on the reception quality for the BBC World Service radio transmission funded by his Department; and if he will make a statement of future prospects. [475]

  Mr. Hanley
  [holding answer 28 November 1995]: The world service uses satellites to distribute to its overseas relay stations. Satellites have improved reliability and technical quality. They have enabled World Service programmes to be broadcast by over 900 MW and FM radio stations. A new satellite distribution system, which is being introduced from 1 April 1996, will bring further significant improvements.

  For the longer term, the World Service is investigating direct to home satellite transmission to replace shortwave transmissions. This will depend on the development of low-cost receivers and agreement on the co-ordination of frequencies in the broadcast satellite sound bands. It will probably take many years from the introduction of satellite broadcast before there are sufficient receivers in use to allow the ending of shortwave transmissions.

  Nuclear Tests
  Mrs. Mahon
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement about Her Majesty's Government's policy on nuclear testing. [880]

  Mr. David Davis
  We have no plans to conduct any further nuclear weapon tests. We are actively negotiating for a comprehensive test ban treaty. But it would be wrong for us to criticise the French decision which they believe is necessary to ensure the safety and reliability of their deterrent, and which was taken on the basis of scientific advice.

  Nigeria
  Mr. Simon Hughes
  To ask the Secretary of State for Foreign and Commonwealth Affairs what sanctions the Government have imposed on the military regime in Nigeria. [882]

  Mr. Hanley
  I refer the hon. Member to the answer given by my right hon. and learned Friend the Foreign Secretary earlier. We have noted calls for the severing of trade links and an oil embargo and continue to consider a range of options with our EU and other partners. Nothing is ruled out but we would wish as far as possible to avoid harming ordinary Nigerians.

  Mr. Chris Davies
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he has met representatives of Shell since 10 November to discuss company policy towards Nigeria. [884]

  Mr. Hanley
  I have a broad-ranging discussion with the chairman of Shell UK, Mr. John Jennings, on 23 November during which Nigeria was discussed. My noble Friend Baroness Chalker of Wallasey also met Mr. Jennings on 16 November.
  789

  Kashmir Elections
  Mr. Heppell
  To ask the Secretary of State for Foreign and Commonwealth Affairs what reason he has been given by the Indian Government for the cancellation of elections in Kashmir. [883]

  Mr. Hanley
  My right hon. and learned Friend the Foreign Secretary discussed the situation in the State of Jammu and Kashmir with the Indian Foreign Minister on 21 November. Under the Indian constitution, responsibility for decisions relating to the conduct of elections rests with the independent Indian Election Commission.

  India (Prisoners)
  Mr. Corbett
  To ask the Secretary of State for Foreign and Commonwealth Affairs what progress has been made on the conclusions of an agreement with the Indian Government to enable convicted prisoners to apply for transfer to a prison in their home country. [886]

  Mr. Hanley
  I raised the prisoner transfer agreement with my opposite number when I visited India last month. Negotiations have now reached an advanced state and I hope that we will sign an agreement in the very near future.

  Cyprus
  Lady Olga Maitland
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has received with regard to the Greek Cypriot application to join the European Union. [887]

  Mr. David Davis
  This Department is in regular contact with the Government of the Republic of Cyprus and other interested parties on this issue.

  Mr. Cox
  To ask the Secretary of State for Foreign and Commonwealth Affairs when the British high commissioner or one of his officials will next visit the Karpas area of occupied northern Cyprus. [1778]

  Mr. Davis
  British high commission officials visit the Karpas every three to four months. The last such visit was on 22 November 1995.

  Mr. Cox
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to visit the Republic of Cyprus. [1779]

  Mr. Davis
  None.

  Mr. Cox
  To ask the Secretary of State for Foreign and Commonwealth Affairs what private discussions with members of the enclaved Greek Cypriot community and visits to their homes and properties take place when a British high commission official visits the Karpas area of the occupied northern Cyprus. [1780]

  Mr. David Davis
  The nature of such visits varies according to the availability and willingness of inhabitants to meet officials. The last time a British high commission official visited the Karpas he had extensive discussions with Greek Cypriots in Leonarisson, visited the home of a Greek Cypriot near Ayios Trias, and had a full exchange with a Greek Cypriot family in their home near Rizorkarpasso.
  790

  Syria
  Mr. Hicks
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he next hopes to meet the Syrian Foreign Minister to discuss bilateral relations. [888]

  Mr. Hanley
  My right hon. and learned Friend the Foreign Secretary met Foreign Minister Shara'a in Damascus on 8 November and on 27 November in Barcelona, to discuss bilateral relations and the middle east peace process.

  European Union Decisions
  Mrs. Dunwoody
  To ask the Secretary of State for Foreign and Commonwealth Affairs what discussions he has had with his European counterparts about the need to reform the European Union's decision-making procedures. [889]

  Mr. David Davis
  I frequently meet my European counterparts to discuss a wide range of topics, including decision-making procedures.

  Brazil
  Mr. Corbyn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what discussions he has had with the Government of Brazil concerning the rights of the Makuxi people in Ruraima and the expenditure of Group of Seven money. [871]

  Mr. David Davis
  The Government of Brazil are aware of our concern that the rights of the Makuzi and the other indigenous people of Brazil should be observed and protected. Our embassy in Brasilia keeps in regular touch with the Brazilian authorities and monitors the situation closely. The ODA representative in Brasilia is in regular contact with the Brazilian authorities about the expenditure of G7 money.

  Mr. Battle
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has made to the authorities in Brazil about the trials for the murder of agricultural workers' leaders; and if he will make a statement. [881]

  Mr. Davis
  I believe that the hon. Member is referring to the murders of rural workers in Rio Maria in southern Para in 1991 and 1992. The embassy in Brasilia has remained in regular touch with the Brazilian authorities about these cases and has attended the resulting trials where possible. The sentences for those convicted have ranged from suspended sentence to 50 years imprisonment.

  Rwanda
  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs what progress has been made towards bringing to trial those accused of genocide in Rwanda. [2567]

  Mr. Hanley
  The international criminal tribunal for Rwanda expects to bring its first indictments shortly. The United Kingdom has played a full part in efforts by the international community to rehabilitate the domestic judicial system in Rwanda.
  791

  GCHQ
  Mr. David Nicholson
  To ask the Secretary of State for Foreign and Commonwealth Affairs, pursuant to his answer of 17 November,Official Report, column 13, what was the value of new equipment investment in GCHQ Culmehead in the financial years 1993–94, 1994–95 and 1995–96 to date; and if he will make it his policy that such new equipment will be effectively redeployed elsewhere when GCHQ Culmehead closes. [3128]

  Dr. David Clark
  To ask the Secretary of State for Foreign and Commonwealth Affairs, pursuant to his answer of 20 November,Official Report, column 13, when equipment was last ordered for the GCHQ composite tracking station in Culmehead; what was the nature of this equipment; and what will happen to this equipment after the site is closed. [2699]

  Mr. Rifkind
  It is not Government policy to reveal details of the procurement of equipment used for intelligence purposes. So far as possible, equipment at the composite signals organisation station at Culmehead will be redeployed when the station closes.

  Correspondence
  Ms Armstrong
  To ask the Secretary of State for Foreign and Commonwealth Affairs what is the published recommended response times within which his Department is expected to reply to letters from the public. [2996]

  Mr. Hanley
  The target for both the diplomatic wing and the ODA is 20 working days.

  Middle East
  Mr. Hawkins
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assistance Her Majesty's Government are giving to the peace process in the middle east. [876]

  Mr Hanley
  On his recent visit, my right hon. and learned Friend the Foreign Secretary encouraged the Palestinians and Israelis to maintain progress on the Palestinian track. He also urged Syria and the Israelis to press forward in their negotiations. He encouraged all the countries of the region to support the peace process. In addition, the United Kingdom provides over £83 million in assistance to the Palestinians, and is providing observers for the forthcoming Palestinian elections.

  Lockerbie
  Mr. Dalyell
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will discuss with the United Nations the request of the Libyan Government to hold a trial in the Hague, under a Scottish judge, operating Scottish rules of evidence, of the two Libyan suspects involved in the Lockerbie bombing. [1638]

  Sir Nicholas Bonsor
  No.

  Entry Clearance
  Mr. Fatchett
  To ask the Secretary of State for Foreign and Commonwealth Affairs what is the cost of an application for entry clearance in pounds sterling in each of the entry clearance posts overseas. [2840]
  792
  Mr. Hanley
  Entry clearance application fees are set in pound sterling, are the same worldwide and the equivalent is charged in the appropriate local currency. Details of the current fees are given in the consular fees order 1995 (SI 1995 No. 1617).

  Mr. Fatchett
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list, for each entry clearance post, how many applications to visit the United Kingdom to(a) attend a funeral and (b) have medical treatment have been made in the last year for which information is available and how many of these applications were refused. [2842]

  Mr. Hanley
  The information requested is not available. A total of 1,086,940 applications for temporary admission were received in 1994 but separate records showing the purpose of each visit are not kept.

  Mr. Fatchett
  To ask the Secretary of State for Foreign and Commonwealth Affairs what action has been taken to implement the recommendations set out in the report by the independent monitor in respect of the Asylum and Immigration Appeal Act 1993, published in December 1994. [2844]

  Mr. Hanley
  In her first report as the independent monitor into entry clearance refusals without a right of appeal, Dame Elizabeth Anson made four recommendations.

  First, that all applications and re-applications should be accepted and applicants should be told that they have a right to proceed, even where warned of likely failure. Instructions have been issued to posts to implement this recommendation, including a suitable written notification for applicants.

  Secondly, posts should be more consistent in their requirements for documentation before an entry clearance application is lodged or an applicant interviewed. We are encouraging greater consistency between posts and encouraging all posts to have a set list of documents required in advance.

  Thirdly, the refusal notice should not refer to confidential matters such as political asylum applications by United Kingdom sponsors or others, given that the notice may become a public document with an applicant's consent. Instructions have been issued to posts reminding them of this requirement.

  Finally, writing should be legible on all documents on an applicants file. We are encouraging posts to ensure this, particularly the typing of refusal notices. This process is being helped by the spread of word processing equipment at posts.

  Mr. Fatchett
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list the average waiting time before an interview is granted at each entry clearance post overseas; and if he will make a statement on the training given to entry clearance officers on interviewing. [2839]

  Mr. Hanley
  Eighty-six per cent. of all applications are issued within 24 hours of being lodged either on the evidence of the papers or after a short interview. It is not possible to provide a calculation of average waiting times for longer interviews at each post except at disproportionate cost.
  793
  Prior to taking up appointment as an entry clearance officer, FCO personnel attend an intensive three-week course run by the immigration and nationality department unit.

  Mr. Fatchett
  To ask the Secretary of State for Foreign and Commonwealth Affairs how much has been collected in application fees for entry clearance since the introduction of the Asylum and Immigration Appeal Act 1993; and how much of that total represents fees accepted for applications which were subsequently refused. [2841]

  Mr. Hanley
  Records of application fees are kept by financial year only. The value of fees collected for applications which were subsequently refused is not separately recorded. The hon. Member may find the following useful:

  Application fees collected for entry clearance applications in the financial year 1993–94 totalled £30.51 million.

  Application fees collected for entry clearance applications in the financial year 1994–95 totalled £32.35 million.

  The number of refusals made at all entry clearance posts overseas during 1993 and 1994 was 143,113.

  Mr. Fatchett
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many requests to reconsider refusals for entry clearances have been received from right hon. and hon. Members in each year since the introduction of the Asylum and Immigration Appeals Act 1993. [2843]

  Mr. Hanley
  This information is not available except at disproportionate cost.

  Mr. Fatchett
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list the location of entry clearance posts overseas, detailing for each(a) the number of locally engaged staff, (b) the total number of staff employed, (c) the number of full-time entry clearance managers and (d) the number of interpreters. [2836]

  Mr. Hanley
  In view of the amount of detail needed to answer this question I will write to the hon. Member shortly.

  Mr. Fatchett
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list the number of(a) applications to enter the United Kingdom for temporary purposes and (b) refusals made at each entry clearance post overseas from 26 July 1993 to the last available date for which information is available; and if he will express the number of refusals as a percentage of the whole. [2837]

  Mr. Hanley
  In the form requested, these figures could be compiled only at disproportionate cost. Details of entry clearance applications for temporary purposes, both granted and refused, are in table 2.1 in the "Control of Immigration Statistics" published by the Home Office for the years 1993 and 1994.
  794
  Mr. Fatchett
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list the time allowed for interviews at each designated entry clearance post overseas. [2838]

  Mr. Hanley
  As a guide, entry clearance posts are offered the following target times for interviews:

  3 minutes: for straightforward applications, received at the counter, by post or from a travel agent, resulting in immediate issue.

  10 minutes: for secondary examination of less straightforward applications.

  30 minutes: for cases likely to result in refusal.

  45 minutes: for settlement applications.

  In practice, posts achieve timings close to these targets, but a list showing times taken in each post could be compiled only at disproportionate costs.

  Invoices
  Mrs. Roche
  To ask the Secretary of State for Foreign and Commonwealth Affairs 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. [1123]

  Mr. Hanley
  [holding answer 22 November]The information available about the amount owed—expressed as a figure and as a percentage of payments as a whole— is set out in the following table:

  £000

  1993–94

  1994–95

  11995–96

  FCO (DW)

  —

  210(8 per cent.)

  243 (8 per cent.)

  ODA

  26,242(13 per cent.)

  55,356(13 per cent.)

  20,580 (7 per cent.)

  Wilton Park

  —

  1 (5 per cent.)

  —

  NRI

  —

  1,460 (4 per cent.)

  1,340 (8 per cent.)

  1 To end of October. Most of these invoices have now been paid.

  To obtain detailed information about amounts owed in earlier years would incur disproportionate cost.

  Former Yugoslavia
  Mr. Tredinnick
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the prospects for peace in the former Yugoslavia. [866]

  Mr. Simon Coombs
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the progress of talks aimed at a permanent settlement in Bosnia; [877]

  Mr. Rifkind
  I refer the hon. Members to the statement I made in the House on 22 November,Official Report, columns 659–61.
  795

  EC Commission Conduct
  Mr. Richard Shepherd
  To ask the Secretary of State for Foreign and Commonwealth Affairs what code governs the conduct of staff at the European Commission's office in London. [2793]

  Mr. David Davis
  The code of conduct is available from the European Commission office at:

  No. 8 Storey's Gate

  London

  SWIP 3AT.

  796

  Foreign Assets
  Mr. Tony Lloyd
  To ask the President of the Board of Trade if his Department has seized or frozen personal accounts and assets of members of foreign Governments; what was seized or frozen; and if he will make a statement. [2918]

  Sir Nicholas Bonsor
  I have been asked to reply.

  I refer the hon. Gentlemen to the answer given to his previous question on 27 November, Official Report, column 429.

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

European Union: Enlargement
Lord Hooson Lord Hooson asked Her Majesty's Government:
Whether in the event of the European Union being expanded by the inclusion of certain eastern European countries they envisage that these countries will have full membership, including the benefits of the common agricultural policy or whether Her Majesty's Government envisage a status for these countries stopping short of full membership of the Union.
The Minister of State, Foreign and Commonwealth Office (Baroness Chalker of Wallasey): My Lords, in all previous enlargements of the European Union, new members have accepted the obligations and benefits of full membership. We expect the associated countries of central and eastern Europe to do the same on their accession. We are, however, pressing for major reform of the common agricultural policy before enlargement to the east takes place.
Lord Hooson: My Lords, is the Minister aware that all the indications are that the eastern European countries need a great deal more economic help and support before there can be any thought of them becoming full members? There is no indication from the full members of the present European Union that they are prepared to change the common agricultural policy. Therefore, was not Mr. Kinnock right when he said in a speech reported two days ago that the possibility of accession of the eastern European countries is remote?
Baroness Chalker of Wallasey: My Lords, Mr. Kinnock made an interesting speech but it is much too early to say whether his words will become reality. However, we have read his speech with interest and we shall certainly bear his thoughts in mind.
As regards help to the countries of central and eastern Europe in preparation for membership of the European Community, no country does as much as Britain through the know-how funds in helping them to privatise, to modernise their financial systems and to bring themselves into the new century. I believe that we are doing all that we can to help. It would also be of assistance if the European funds for the PHARE programme were put to the same ends.
564
I have said many times in this House that the common agricultural policy has to change for the sake not only of new members but of existing members too.
Lord Beloff: My Lords, does my noble friend agree that what these countries mainly want is access to western European markets for their goods, including agricultural products, and that there seems a total determination on the part of the French and Bavarian farmers to see that no such thing happens?
Baroness Chalker of Wallasey: My Lords, my noble friend has a point, but he knows full well that one of the reasons we were to the fore in the development of the single European market and why we have worked so hard for the completion of the Uruguay Round was exactly that: we want open trading. These countries want that open trading more than anything else and anyone who stands in the way of it will eventually impede their own economic progress.
Lord Bruce of Donington: My Lords, is it not the case that the common agricultural policy can be changed only by a unanimous vote of its members and there is not the remotest chance of the Franco-German axis agreeing to any radical change in it? Indeed, the story is exactly the same as it was 20 years ago when the Government stated that they hoped to be able to use their influence to change the CAP. It cannot be done with the axis as it is.
Baroness Chalker of Wallasey: My Lords, I believe that the noble Lord, Lord Bruce of Donington, is not looking as far ahead as some others. There has been a distinct change in the attitude of many member states but not as much change as we would like among the French or certain of the Germans. However, the German Finance Minister agrees with us that the common agricultural policy has to be changed. It may not happen immediately but it is happening gradually.
Baroness Robson of Kiddington: My Lords, in reply to the original Question the Minister said that nothing can happen until the CAP has been changed, although she did not go as far as the noble Lord, Lord Bruce of Donington. In view of the fact that it will take many years to change the CAP, has she any idea how long it will be before the eastern European countries are offered membership of the European Community?
Baroness Chalker of Wallasey: My Lords, it would be a foolish woman who sought to predict, even in your Lordships' House, when that will be. We have worked towards enlargement in an important way by providing these countries with the help which will put them in a better position to take the benefits of accession when that happens. However, as regards a timetable, I can give the noble Baroness no clear indication.
Baroness Elles: My Lords, has consideration been given to linking in particular the Visegrad countries

565
to, say, the CFSP? Although they would not become full members of the EC, some support for their fragile democracy might be considered to be supported by member states of the EC.
Baroness Chalker of Wallasey: My Lords, it has not happened in quite the way that my noble friend indicated, but many of these countries are proceeding apace with their changes to become members of NATO. That is different from membership of the CFSP but, if there were accession to a single pillar rather than to the Union as a whole, no doubt it would help them.
Lord Richard: My Lords, is the Minister aware that the aggressive pessimism about the future of the common agricultural policy of my noble friend Lord Bruce is, perhaps, somewhat overdrawn? Further, would the Minister agree that, in the past 20 years, there have indeed been considerable changes in the CAP? Will the noble Baroness also confirm that the percentage of the community budget now devoted to agriculture is considerably less now than it was 20 years ago? Finally, if the Minister has not already done so, would she kindly underline the enthusiasm that Her Majesty's Government have for the expansion of the Union so as to bring in the east European countries as soon as that may be feasible and possible?
Baroness Chalker of Wallasey: My Lords, I shall leave the noble Lord, Lord Richard, to deal with his noble friend. As regards changes, I would be quite wrong to say that there have not been any; indeed, there have been. The noble Lord is absolutely right. I wish that we could, between us, manage to explain them to his noble friend from time to time as he does not seem to follow them. It is perfectly true that there is a reduction in the common agricultural policy, but it is not declining in size as fast as anyone would wish.
So far as concerns the noble Lord's fourth question, of course we wish to see accession negotiations begin as soon as possible. I believe that the noble Lord knows that the Union is committed to negotiate with Cyprus and Malta six months after the IGC ends. That will probably be the first expansion as regards the Visegrad countries—that is, if they can so prepare themselves and we can get the changes that we need not only in the CAP but also in the structural funds.
Lord Hylton: My Lords, as long transitional periods will almost certainly be needed for the eastern European countries, is it not very desirable that that process should start as soon as possible for countries which have, after all, been victims of Stalinism?
Baroness Chalker of Wallasey: Yes, my Lords; I thoroughly agree with the noble Lord.
Lord Harmar-Nicholls: My Lords—
Noble Lords: Next Question!
Lord Harmar-Nicholls: My Lords, is my noble friend the Minister saying that, if there are weaknesses, we have to wait until Germany changes its mind before anything can be done about it?
Baroness Chalker of Wallasey: No, my Lords; I am saying that we have to work even harder to change the minds of France and Germany and of those who stand in the way of change in the CAP.

Rail Privatisation: Bidding
2.46 p.m.
Lord Haskel Lord Haskel asked Her Majesty's Government:
Why they are continuing to prevent British Rail from bidding for franchises in relation to the privatisation of the railways in view of the relevant provisions of the Railways Act 1993 that they should not be so debarred.
The Parliamentary Under-Secretary of State, Department of Transport (Viscount Goschen): My Lords, the Railways Act gives the Franchising Director the discretion to decide, after consultation with the British Railways Board and the Rail Regulator, whether the board or any subsidiary of the board shall be allowed to bid for franchises. In respect of the first seven franchises, the Franchising Director has decided that the board shall not be allowed to bid. He will consult the board and the regulator each time he proposes to invite tenders.
Lord Haskel: My Lords, I thank the Minister for that reply. However, is he aware that some people are concerned that British Rail has not been invited to bid because the Franchising Director believes that, in doing so, he is interpreting the wishes of the Government? Will the Minister now state clearly that it is the Government's policy to enable British Rail to bid for franchises and call upon the Franchising Director to encourage it to do so?
Viscount Goschen: My Lords, the Government's position is very clear. We support the detailed arrangements as made in the Railways Act, which are again extremely clear. British Rail is permitted to bid, except when the Franchising Director decides that that should not be the case—at his discretion—if it would be in the interests of promoting competition for franchisers; of promoting the award of franchises to companies in which qualifying rail employees have a substantial interest; and of encouraging new entry into the passenger railway industry. Those are the circumstances that are laid down in the Act. We support that.
Lord Taylor of Gryfe: My Lords, is the Minister aware that running the railways is a very complex and important part of our infrastructure? Is he also aware that the people who might bid for such franchises on behalf of British Rail are experienced operators of the railways? Therefore, is it wise to exclude those operators acting as bidders for the new franchise?
Viscount Goschen: My Lords, the Franchising Director must weigh up the very points that the noble Lord has made. However, the House should bear in mind that, as I mentioned, the Franchising Director also has a duty to promote the award of franchises to companies in which qualifying railway employees have a substantial interest—that is, the management buy-out type of situation. With that type of situation, it is very clear that existing management is able to put a substantial investment of its knowledge into the railway

567
franchising programme. The position on whether BR itself should be allowed to bid remains as stated in the Act.
Lord Peyton of Yeovil: My Lords, I would like to be clear that the Franchising Director is acting on his own discretion and without any guidance from the Government. In that case does it not appear that he is being a little wooden in the exercise of his discretion?
Viscount Goschen: My Lords, the Government and the Secretary of State are specifically prevented from giving the Franchising Director objectives, instructions and guidance on the exercise of his powers under Section 25 of the Act, which is the relevant section to do with allowing BR to bid. We are specifically prevented from giving the Franchising Director such directives, so it is up to him to make his own decision.
Lord Dean of Beswick: My Lords, is not the Minister aware that British Rail is on record as saying that it will bid for franchises and that it will win? Does not the Minister accept from me that as British Rail is to be excluded from the present clutch of franchises, whoever obtains those franchises may do so at a knock-down price which is against the interests of the public purse?
Viscount Goschen: My Lords, I do not agree with the noble Lord. There has been healthy competition for these franchises. However, the Franchising Director must assess each franchise on an individual basis. He must assess the circumstances and consider whether preventing the BR Board from bidding in accordance with the discretionary powers given to him under the Act coincides with the duties that he has been given by the Act.
Viscount Caldecote: My Lords, does not my noble friend agree that British Rail managers know as much about managing British railways as anyone and that when they are freed from the shackles of Treasury control they are most likely to make a success of running British Rail franchises? Will he not therefore do a little arm twisting and perhaps give a nod and a wink behind the scenes to the Franchising Director to persuade him to allow British Rail managers to bid for all franchises?
Viscount Goschen: My Lords, the answer is no to both questions. I have said that we are specifically prohibited from doing exactly what my noble friend asks. We will not and cannot do that. As regards the other point, I agree that those who manage the railways at the moment have a substantial body of knowledge about the railways and they of course will be considering whether to submit management buy-outs. If franchises are won by the British Railways Board, the members of the board will not be freed from the constraints of the public sector borrowing rules because they will still be part of the public sector.
Lord Harris of Greenwich: My Lords, is the noble Viscount aware that we accept what he has said about
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the position of his department giving directives, but is it also clear that there is no informal advice being given by Ministers or officials?
Viscount Goschen: My Lords, it is not just a matter of specific directives but also of objectives, instructions and guidance. That is the wording contained within the Act and we are therefore prevented from giving those objectives, instructions and guidance. The matter cannot be clearer than that.
Lord Clinton-Davis: My Lords, is not the truth of the matter that when the Government introduced the Railways Bill they did not want to allow British Rail to bid? It was only as a result of the activities of this House and of the noble Lords, Lord Peyton and Lord Marsh, in particular—
Noble Lords: Oh!
Lord Clinton-Davis:—as well as the Opposition of course, that some common sense prevailed. The clear will of Parliament was that British Rail should be permitted to bid. The net result of the situation is the following, is it not? British Rail has not been permitted to bid and therefore the original will of the Government is being respected by the Franchising Director. Is that not an utter disgrace?
Viscount Goschen: My Lords, I believe that the noble Lord has misinterpreted the situation. The will of Parliament was indeed that British Rail should be allowed to bid; the will of Parliament was also that British Rail should be allowed to bid subject to the discretion of the Franchising Director. That point was also inserted into the Act at the will of Parliament. Parliament has agreed to the Bill, which is now an Act, as a whole, and we must follow it.
Lord Mackie of Benshie: My Lords, will not the Minister tell us who selected this wholly objective Franchising Director who has turned down seven bids? Surely it was the Government who selected him, and their criteria used in the selection must have been useful to them.
Viscount Goschen: My Lords, it was a government appointment but the Franchising Director's role and duties are clearly laid down in statute. He cannot breach those and we cannot breach ours.
Baroness Castle of Blackburn: If British Rail was allowed to tender for the franchise for the busy Chiltern line would passengers at High Wycombe station not have to stand—as I did this morning in a biting wind—outside what used to be, under British Rail administration, their waiting-room, which has now, in preparation for privatisation, become the area retail manager's office?
Viscount Goschen: My Lords, I am slightly at a loss. The noble Baroness is complaining about the service provided by British Rail yet at the same time she wants British Rail to continue to run the service. The process

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of franchising as enacted by this Act will produce substantial benefits for the travelling public, including the noble Baroness.

Merchant Navy Cadet Recruitment
2.55 p.m.
Lord Clinton-Davis Lord Clinton-Davis asked Her Majesty's Government:
Whether they are satisfied with cadet recruitment for the British merchant navy and, if not, what steps they propose to take to extend such recruitment.
Viscount Goschen: My Lords, in seafaring, as with any industry, recruitment is primarily a matter for employers. Nevertheless we have introduced positive measures to assist recruitment such as the Government Assistance for Training (GAFT) scheme, which has helped over 2,500 officer cadets train for their first certificate of competency. We are reviewing the effectiveness of this and other merchant navy support schemes.
Lord Clinton-Davis: My Lords, does not the Minister agree that the tremendous shortage of skilled seafarers in the British merchant marine is likely to prejudice opportunities as regards the UK fleet in securing advantages from the increased world trade in cargo shipping that is projected? Does not the Minister also agree that a recruitment figure of 420 cadets per year is about one-third of the number of cadets that is required if we are to be able to make that sort of contribution? What are the Government proposing to do about that?
Viscount Goschen: My Lords, I agree with the noble Lord that there are, and will be, considerable opportunities within the merchant shipping sector. I also agree that there is a problem as regards the number of recruits entering merchant shipping. That is why we have put into place some good and effective training schemes whereby the Government assist cadets who are entering merchant shipping. The Government Assistance for Training scheme, for example, has never refused an applicant to the scheme on the basis of capacity. I agree with the noble Lord, Lord Clinton-Davis, that it is important to have a good flow of people coming into the industry, but his figure for those cadets corning in this year should be compared with that of 1987/88, when it was less than half that figure.
Lord Boyd-Carpenter: My Lords, is not my noble friend concerned at the fact that the British merchant navy has shrunk so much in recent years? What are the Government doing about that?
Viscount Goschen: My Lords, we are concerned about that but it has been a worldwide problem among all developed countries that shipowners have tended to flag out to other foreign registers. We are doing something about that on a wide range of fronts. We are attacking substandard shipping through port state
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controls. We are preventing substandard ships from operating to our ports. We are supporting training through direct assistance, the Government Assistance for Training scheme and the docks scheme. We have put forward a number of other measures to enhance the competitiveness of the British Red Ensign.
Lord Murray of Epping Forest: My Lords, is the noble Viscount aware that my noble friend is a little optimistic as regards the present government cadet recruitment figure? It is 360, not 420. Is he further aware that there is a strong but unsatisfied demand from well qualified men and women for cadetships? One agency has received 1,000 applications for only 30 cadetships. Is he aware, on the other hand, that employers are not recruiting cadets because, although GAFT is in operation, the individual values of the grants are too low? Will the noble Viscount therefore consider making a substantial increase in the level of individual grants available under GAFT in the course of reviewing the future operation of this desirable innovation?
Viscount Goschen: My Lords, of course we will look carefully at the level of the grant. However, I think that the industry itself accepts that the scheme has been a considerable success in helping those who seek to enter the industry. The wider problem of employment within seafaring of UK officers is a much broader issue. As I have said, we are addressing that on a number of different fronts.
Baroness Strange: My Lords, can my noble friend tell us how many ships there are now in the British merchant navy and how many there were 50 years ago?
Viscount Goschen: My Lords, I do not believe that I can give the figure for 50 years ago. My figure for the number of UK-registered vessels over 500 gross tonnes which trade is 271.
Lord Molloy: My Lords, will the noble Viscount consider making representations on our behalf to those who are responsible for this matter to express our apprehension that not enough is being done to resolve the problem?
Viscount Goschen: My Lords, the problem can only be resolved as a result of co-operation and partnership between the industry itself and the Department of Transport. That partnership exists, and we are working very closely with the industry to address the problem through the schemes that I have mentioned.
Lord Campbell of Croy: My Lords, did the intake of cadets increase after the government assistance with training was introduced? Should this not be continued, with more publicity, at a time when international regulations are fortunately becoming stricter and therefore creating a demand for British maritime skills?
Viscount Goschen: Yes, my Lords. I agree that there is already substantial demand for qualified British officers. One of the main problems arises in the recruitment and training phase. My noble friend is quite correct that, as we have heard, since the introduction of

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the scheme there has been a substantial increase in the numbers coming into the industry. The training scheme has helped. I agree that we still face a difficult problem.
Lord Greenway: My Lords, while the Government have taken some measures to alleviate the situation, does the noble Viscount not agree that, in the light of a forecast increase in world trade, as the result of which more ships will be needed, we shall need not only to train more seafarers but also to ensure that our shipping companies have the right ships for them to serve in? On the subject of manning, should we not also be looking very carefully at the future quality of life of seafarers, as reduced manning and long working hours have created a situation in which safety could well be compromised?
Viscount Goschen: My Lords, the noble Lord will know that the international community has acted strictly to address the problems of hours of work. I agree that historically that has been a problem. I hope that British companies and British ships have been better than most. I agree with the noble Lord that there are substantial opportunities for merchant shipping. We have already heard what those are. I believe that the British fleet will be able to play its full part in that industry.

Transport Research Laboratory Sale: Bids
3.2 p.m.
Baroness Castle of Blackburn Baroness Castle of Blackburn asked Her Majesty's Government:
Which of the bids they have received for the Transport Research Laboratory they have shortlisted; which of those shortlisted are non-profit distributing concerns and what is the amount of the bid in each case.
Viscount Goschen: My Lords, two bidders have been shortlisted in the sale of the Transport Research Laboratory. They are a consortium comprising Pell Frischmann Consulting Engineers Limited, Mouchel Associates Limited, the Automobile Association and the Royal Automobile Club; and the Transport Research Foundation, which includes members of TRL's existing management. The foundation is bidding to acquire TRL as a non-profit distributing company. The AA and RAC are non-profit distributing concerns. The amount of each bid is confidential.
Baroness Castle of Blackburn: Is the Minister really telling us that we are not to be allowed to know what has influenced the Government financially in the size of the different bids, in view of their overwhelming anxiety to get money at any cost or quality in order to prop up their tottering finances? When will we know what the Government's motives have been? Is it not a fact that the alternative bidder—the Pell Frischmann, Mouchel, AA, RAC consortium—consists of concerns that have vested interests in one side of transport—namely, road construction and car owners—and therefore is incapable of taking an overall view of what is required for research in the transport industry as a whole?
Viscount Goschen: My Lords, I certainly do not agree with the noble Baroness that because those concerns have interests in certain areas they are not capable of owning and running a company that produces independent research. One only has to look at all kinds of companies in the private sector which produce independent research, for which the Government are often a customer.
I have forgotten the first part of the question. Will the noble Baroness please repeat it?
Baroness Castle of Blackburn: Is the Minister serious? I thought that it was one of his evasions. I am glad to have the opportunity to repeat the question.
Is the Minister really telling us that this House is not entitled to know the price which has been offered by each of the concerns and therefore what has been the nature of the financial inducement to the Government to sacrifice quality to their desperate need to prop up their tottering finances?
Viscount Goschen: My Lords, I remember it now. As the noble Baroness will be very well aware, our finances are not tottering. They are in extremely good health. She should have listened to my right honourable friend the Chancellor of the Exchequer yesterday when he detailed exactly how they stand. We are in the middle of a competitive bidding process. It would not be in the interests of fair competition, which I am sure the noble Baroness wants, to disclose the amounts at this stage.
Lord Haskel: My Lords, in view of the fact that the National Engineering Laboratory was sold for minus £1.95 million, will the Minister tell us whether the Road Research Laboratory will be sold for a plus or minus amount?
Viscount Goschen: My Lords, where there have been instances of businesses being sold for a net minus sum, there have been considerable liabilities which have been taken over. I should not like to comment at this stage on the amount we expect to receive for the laboratory. The noble Lord will have to wait and see. I am sure that he will be very pleased when he finds out.
Lord Clinton-Davis: My Lords, is the Minister aware that we do not worry about his forgetting the questions; it is his answers that cause great anxiety? Will the Minister give the House some indication as to when this absurd process is likely to end? Can he also indicate to the House why it is that the Government are continuing with this illogical attempt to decimate an institution which has organised itself in such a way that the country can be wholly proud of its activities?
Viscount Goschen: My Lords, the country can be proud of the good quality research that has been produced by the laboratory. We believe that the country will continue to be proud of it in the future when the laboratory is fully in the private sector. To answer the noble Lord's question about the timetable, the shortlisted bidders have

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been asked to submit their final bids by 21st December. We expect an announcement of the selected purchaser to follow early in the new year.
Baroness Castle of Blackburns: Has the Minister also forgotten the report of the Select Committee on Transport in another place, which said that it could not recommend privatisation to the Commons unless there were far greater guarantees that the independence and impartiality of the privatised concern would be safeguarded? Has not his evasiveness today proved that we can have no confidence whatsoever that his choice will safeguard that impartiality?
Viscount Goschen: My Lords, I hope that I have not been evasive today. I have sought to answer the questions that have been put to me. We will ensure that TRL's independence and impartiality are safeguarded when the institution is brought into the private sector. That is a commitment and it is one that we stand by.

Business
Lord Strathclyde: My Lords, at a convenient moment after 3.30 p.m. my noble friend the Leader of the House will, with the leave of the House, repeat a Statement that is to be made in another place on Northern Ireland. That will be followed by my noble friend Lord Mackay of Ardbrecknish, who will, again with the leave of the House, repeat a Statement on social security uprating.

Business of the House: Debate this Day
3.8 p.m.
The Lord Privy Seal (Viscount Cranborne): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the debate on the Motion in the name of the Lord Desai set down for today shall be limited to four and a half hours.—(The Lord Privy Seal.)
On Question, Motion agreed to.

Hybrid Instruments: 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 a Select Committee be appointed to consider hybrid instruments and that as proposed by the Committee of Selection the following Lords together with the Chairman of Committees be named of the Committee:

L. Brougham and Vaux,

V. Craigavon,

L. Gallacher,

V. Oxfuird,

L. Wade of Chorlton.—(The Chairman of Committees.)

On Question, Motion agreed to.

Standing Orders (Private Bills): 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 on the Standing Orders relating to Private Bills 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. Falkland,

L. Gallacher,

V. Hood,

E. Lloyd-George of Dwyfor,

L. Renton,

L. Strabolgi,

L. Wade of Chorlton.—(The Chairman of Committees.)

On Question, Motion agreed to.

Personal Bills: Select Committee
The Chairman of Committees: My Lords, I beg to move the third Motion standing in my name on the Order Paper.
Moved, That a Select Committee be appointed to consider personal Bills and that as proposed by the Committee of Selection the following Lords together with the Chairman of Committees be named of the Committee:

L. Hooson,

B. Seccombe,

L. Strabolgi,

L. Templeman,

L. Wilberforce.—(The Chairman of Committees.)

On Question, Motion agreed to.

Economic Affairs
3.10 p.m.
Lord Desai Lord Desai rose to call attention to the economic state of the nation, and to the Budget statement of 28th November; and to move for Papers.
The noble Lord said: My Lords, last week in the debate on the gracious Speech we had an occasion to discuss the state of the economy and industry. Today I hope that we can take that discussion further because on that occasion some of us were constrained from speaking our mind because we awaited the details of the Budget announced yesterday.
All that one can say about the Budget is that it could have been much worse. With the permission of the House, after taking a broad look at the state of the economy, I wish to point out in a general way why I believe that the Budget could have been worse, why it fails to be better, and the ways in which I believe that it could have been improved.
As we have all seen, the Budget has been given a lukewarm welcome from the Back Benches of the ruling party and a hostile welcome from everywhere else in the country. It combines an immediate net giveaway of about £3 billion with arguments that there is room for having that moderate tax cut along with a small increase in spending on education, health and welfare. It argues that that somehow combines sound finances, low inflation and a tax cut.
Sound finances are obviously a matter of choice. One has to define them in the way that one will. Given the Government's own predictions last year, it is true that this year's predictions are more pessimistic about the path of the PSBR and how soon the Budget will balance. Paradise has been postponed. It has not only been postponed. On pages 75 and 76 of the Red Book, faced with a higher than predicted PSBR for 1995–96 and for 1996–97, the Chancellor has thought fit to lose £12.5 billion from revenue and to balance that by losing only about £4 billion from expenditure. Therefore £8.5 billion have been added to the PSBR relative to the prediction last year. That increases the ratio of PSBR to GDP and violates the Maastricht conditions; and we shall not get under the Maastricht conditions until after the election.
The election is the key to the way in which the Budget has been framed. One can only be thankful, as I implied before, that the wilder excesses of Tory populism have not had their day and we have not had what is called a scorched earth budget, as we had in 1992. Noble Lords will recall that in 1992, having spent a lot of money in order to win the last election—and to their surprise having won it—the Government were faced with the task of meeting the bill which went up to £50 billion. All our problems over the past four years are encompassed in the task of overcoming the effects of the profligacy which may have won the last election but did not do much good for the economy.
What we now have is another cautious little nudge at seeing whether the markets would bear a signal that the Government intend this year to loosen the reins of public spending a little, although not wildly—a little tax cut here; a little extra spending there. If the markets bear it, if the Chancellor is lucky, and interest rates then come down—and I shall argue later that interest rates will not come down as fast as would be beneficial to the economy—then perhaps next year enough will have been built into the projections to allow a bigger tax cut. Perhaps not only paradise has been postponed, but perhaps the scorched earth policy has been postponed by one year too. We shall see. We do not know what to make of the projections before us.
What we have, clearly in the interests of the electoral cycle, is a policy of relaxation of public spending when it might have been prudent not to have done so. I make no apology for being a fiscal hard man. Noble Lords know that I am no friend of lower taxation. I have never argued for lower taxation. I argue for the appropriate amount of spending to be undertaken and then financed properly. I believe in balancing the Budget and perhaps borrowing only for capital purposes.
However, capital spending has been quite severely cut and a smoke and mirrors element has been added to the Budget which is called the private finance initiative. The private finance initiative projections between this year and next year are the fastest growing item in the economy. We are expected to believe that next year the private finance initiative will net us in the region of £2 billion whereas so far we have hardly seen £0.5 billion.
Therefore the private finance initiative is an excuse for cutting capital spending without putting anything in its place. It is a straight cut in capital spending and nothing else. We should call things by their old names rather than their new names. No doubt at the end of a long evening the Minister will argue that that is not the intention and all kinds of things are in the offing; and perhaps many plans will materialise. We shall see. I have my doubts.
What is interesting in this respect is that much play has been made—and it was made by the Chancellor in his speech—about the Chief Secretary having been very tough on spending, how spending has been brought under control, and so on. A perusal of the Red Book tells us that that is not the case. I refer noble Lords to page 141. In considering the deviation from projections for 1996–97 your Lordships will see that the total amount is £3.2 billion—it is the size of the giveaway—which exactly matches the drawdown of reserves. The Minister may tell me that it is not true and that I have misunderstood the Red Book. However, it is absolutely clear on page 141 of the Red Book. The figure, under changes from previous plans, is minus £3.2 billion; the control total is minus £3.2 billion; and everything else is a little shuffling of the cards—give a little more to health and education, and a little less to defence or whatever it is. By and large, drawing down on the reserves makes possible this net giveaway. Whatever else that is, it is not prudent public finance. People should not pretend that since the Government have been in charge they have so improved the management of the public finances that somehow responsibility and prudence have prevailed.
What is true is that over the past 16 years, if anything, the debt:GDP ratio has worsened. When Labour gave up office, the debt:GDP ratio was 45 per cent. After the country endured much suffering, the ratio was brought down a little. But ever since the late 1980s we have seen a steady rise in the debt:GDP ratio. The Red Book projections show that the debt:GDP ratio will not fall until after the general election. After it, we shall see all kinds of nice things but in the run-up to it we shall see nothing but a little more of the spending habit, albeit clothed in the virtues and protestations of fiscal prudence.
In a sense, I am persuaded and should argue strongly that the economy needs a growth boost. I do not deny that the economy has slowed down and, as it has done so, by the Government's own projections the growth rates for 1995–96 are lower than they expected. The growth rates for 1996–97 are rather high, almost unbelievably high, but we will leave it at that. The economy needs a boost but the kind of boost it needs is, in my view, capital spending. If the Government meant

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to revive, for example, the construction industry, if they seriously meant to do something about unemployment or about the growth rate of the economy, they would not have cut capital spending and relied on private finance initiatives, with a wave of the wand, to make up for the gap.
In principle, we have a cut in capital spending with a small increase in the current net stimulus to the economy, all financed by a drawing down of the reserves. It could have been done in exactly the other way: if one had the room and had £3 billion available, then one could have said: "All right, given that money, it ought to be put into capital spending. Capital spending should not be cut". Then we would have boosted that part of the economy. As it is, our borrowing is in excess of our capital spending, which is not fiscal prudence. Fiscal prudence requires that one borrows for capital spending purposes and for nothing else. I recognise that there are cyclical problems and that recessions cause a rise in the deficit, but the recession was made severe by wrong policies and we are suffering from them now.
Let us examine the likely effects of the Budget on the economy. Had the Chancellor resisted even the slightest temptation to which he has succumbed, it would have been possible to argue with the financial markets that interest rates could have come down drastically, perhaps three-quarters of a per cent. to 6 per cent. Had that happened, I believe that it would have had a widespread stimulating effect on the economy. We do not know how the gilt markets, the money markets, will react, but I feel that a rise in the PSBR, current and projected; a rise in the debt:GDP ratio, current and projected; the postponement of a balanced Budget for at least one year so that we will not see anything until the year 2000 will not please the gilt markets. I make no apology for putting that view forward because low interest rates are essential to the economy. We know that in the globalised world of today if you want low interest rates you must keep your nose clean and act fiscally in a responsible fashion. This Budget is not fiscal responsibility. It is not gross irresponsibility, as some people urge on the Chancellor, but it is certainly not, in any sense of the word, responsible behaviour.
Thus if interest rates are not going to fall as much as one would like, the stimulus must come from somewhere else. Capital spending would have been better as a stimulant than what we have. If we carefully examine the increase in expenditure in the three departments—education, health and law and order—in each case the total budget is being cut. Although there is some rise in health expenditur, once again there is a bit of the smoke and mirror stuff about capital spending. The private finance initiative will ride to the rescue and all kinds of other nice things will happen. It will be the same with education. All kinds of items are being taken out, such as student loans. We do not know, and perhaps the Minister can tell us in his reply, what assumptions are made about student loans and what amount of expenditure has been taken out of the Department for Education's spending funds in order to generate the extra spending that the Department for Education will have. All across the board, such increases in spending
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as have been generated have been gross increases, whereas on the net side, because of the cut in capital spending, we have a peculiar situation.
In the end, one must discount the increase in expenditure which is obviously done for political popularity. I do not begrudge the increases in expenditure but I would have preferred them to be better financed. If we discount that, what is really going on is that the reserves are being drawn down to give back the tax. There is obviously a great need for the Government to regain their tax cutting image. I have never been convinced that cuts in income tax have any great incentive effect, as people argue they have; there is no scientific evidence for it. If there were any, we would have done much more to cut income tax at the bottom of the scale where people pay horrendously high actual rates of income tax, 80 per cent. or 85 per cent., if not more. Nothing much has been done to cut the income tax that people pay at the bottom, but some cuts have been made in income tax at the top.
Over the past three years, when the Government cut the effective rate of taxation they did so not by changing the basic rate but by altering allowances, not indexing them enough or restricting the rate at which they were deductible. Now, in addition to the 1p cut in the basic rate, we have all kinds of over-indexation of allowances. I have not quite worked out the final effective rate of taxation, but it is certainly not the 7p that it has been calculated has been imposed over the past three years.
At the end of the day, we have a half-hearted attempt at displaying fiscal prudence which does not bear careful examination. It is clear that all the numbers go the wrong way for a Chancellor who is asking for fiscal prudence. It will not be a great stimulant for the economy because it will fail to bring interest rates down as much as we would like, and it will not generate employment through capital spending which is clearly required for the economy. I am sorry to be churlish about it, but we must say that this is a phase of the cycle where stimulation was needed for a rapid cut in unemployment. That has not happened.
In that vein, let me say one more thing about the Budget. In the previous Budget, the Chancellor tried innovatively—and I acknowledged it when we discussed the Finance Bill—to do things in the labour market which would encourage the employment of people who were somehow restricted from it. This Budget has nothing to encourage employment. In that respect perhaps my noble friend Lord McCarthy will bear me out. We have nothing to encourage employment. What we have is a Budget which gives a relief for consumption. I am not sure that is what I should like to do, but there is little for employment. I should have preferred a cut in the national insurance contribution, especially creating a threshold at which it becomes applicable, rather than a cut in income tax or the 20p being given back. I have a penchant for higher taxation and balanced Budgets. The Government claim also to have that, but they do not succeed in delivering a balanced Budget. This is a weak Budget, and we shall learn the consequences soon enough. My Lords, I beg to move for Papers.
3.30 p.m.
Lord Clark of Kempston: My Lords, I am sure that the whole House is indebted to the noble Lord for giving us this opportunity to discuss the economic state of the nation and the Budget. Many of us on both sides of this House believe that finance and economics should be debated a little more frequently. It might be worth considering the tabling of a similar Motion every year immediately after the Budget so that we can regularly debate the state of the nation.
I should like to spend some time on the economic situation in this country, as the Motion seeks, before turning to the Budget. The economic state needs to be viewed over a long period; it cannot be done from year to year. Looking back at this Government's record—and presumably in this respect the Government are on trial—and turning our minds back to 1979, we see that the whole economy was then in a complete and utter shambles. We had strikes, rising unemployment, high inflation and so on. We need to look at what has been achieved since then, despite the gloom that I read into the noble Lord's remarks. As politicians we do not pay sufficient attention to the achievements of this Government; all we do is criticise, carp, denigrate and run down the country, which cannot be good.
For example, this country's record on inflation is absolutely superb. It is 3 per cent. or thereabouts. From its peak, unemployment has come down by over 700,000. As the noble Lord said, the basic bank interest rate is presently per cent. It has come down from 15 per cent. That is an achievement. Looking at inward investment, why do the Japanese and the Americans invest here? It is simply because they come in to a competitive nation and a competitive economy. Britain exports more per head than both Japan and the United States. That is not a bad record. We should talk about this sort of thing rather than ignoring it.
Let us take savings. (It is from savings that we get the capital and expenditure on which the noble Lord spent so much time.) In 1979 there were about 3 million shareholders. Today there are over 10 million. That must be an achievement. It must prove that the ordinary man and woman in the street is prepared to put money into ventures to an extent that they never did before—some 10 million people. Why do small businesses prosper? There are about 3.6 million small businesses in this country, 1 million up on 1979. That is an achievement. Only small businesses will bring about the reduction in unemployment that we so much desire.
I accept the fact that taxation has increased over the past few years because of the depth of a recession not envisaged to be so deep by all the pundits, from whichever part of the political spectrum they come. Even given the increase in taxation, comparing the standard of living today with the standard in 1979 the average family is £80 per week better off.
During the period in office of the last Labour Government—and this is probably my only political point until the next one—the standard of living increased by 0.06 per cent. That equals £1.50 a week. Therefore if we compare management by the two parties, it is obvious which one was successful. One has
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reduced the basic rate of taxation from 33 per cent. to 24 per cent. Corporation tax is down from 52 per cent. to 33 per cent. For small businesses the rate was 42 per cent.; it is now down to 24 per cent. Last year the growth in manufacturing industry was up by 12 per cent. That is not a bad record. These are the sorts of statements we should be making, so that our competitors and potential customers and investors from abroad will come into this country.
The jewel in the economic policy of the British Government has been privatisation. Whereas at one time the taxpayer paid out some £50 million per week in subsidies, today my right honourable friend the Chancellor of the Exchequer receives some £55 billion every week. That is quite a good record.
I turn now to the Budget. It is well balanced and provides help for all. I particularly like, as I am sure do most noble Lords, the help that is given to the elderly. As well as the change to inheritance tax, which will take most people out of the inheritance tax bracket, the disallowance in regard to nursing home fees is of great benefit to the elderly; and, to return to the savings field, the retirement bond has given further help. The exemption of unquoted shares—that is, the unquoted securities market, now replaced by the alternate investment market—is bound to help both markets. The marriage allowance and the personal allowance have gone up, as the noble Lord said, more than inflation.
I do not agree with the noble Lord's remark that the reduction in taxation is not an incentive. I remind him that when tax on earned income-83 per cent. in the pound under a Labour Government—came down to 40 per cent., the top taxpayers were paying more tax than they were when it stood at 83 per cent. So an incentive must have been offered, and we should obviously not forget that. The new rate for personal savings, particularly for the basic rate payer, at 20 per cent. is also very good. The noble Lord said that no help has been given in regard to the national insurance contribution. My right honourable friend the Chancellor has decreased the national insurance contribution from employers. It is certainly by a small amount on each payment, but it adds up to £500 million, which is a direct incentive and help to business, and particularly to small businesses.
The noble Lord spoke about the public sector borrowing requirement. I agree with him. We can borrow to raise capital expenditure. I guess that capital expenditure in this Budget is somewhere in the region of £20 billion. Consequently, if we borrow £29 billion, we have overspent by £9 billion. I have always maintained that the change in government accounting from above and below the line was a mistake. One should differentiate between revenue expenditure and capital expenditure. If we do so, the position looks much better.
The Chancellor did not mention it, but we are to have a radical change in our taxation returns in 1997; namely, self-assessment. One thing I can never understand about the fiscal system is the use of 5th April. Why do we not set the date at 31st March? I do not know very many companies whose year ends in April.

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This is a well balanced Budget. It will help those in need. It will help enterprise, and it will certainly help competitiveness. I am certain that it will help to make the UK the enterprise centre of Europe. Finally, I urge noble Lords to stop denigrating the economy of this country and to start talking it up.

Northern Ireland
3.40 p.m.
Viscount Cranborne: My Lords, with the leave of the House I shall now repeat a Statement on Northern Ireland made in another place by my right honourable friend the Prime Minister. The Statement is as follows:
"Yesterday evening, the Irish Prime Minister and I met at Downing Street to launch a new initiative in the Northern Ireland peace process. A copy of our joint communiqué has been placed in the Library of the House.
"In the 15 months since the first of the two ceasefires, there has been a dramatic improvement in daily life in Northern Ireland. People have enjoyed the freedom to go about their daily business without fear of terrorist attacks. Many new jobs have been created. New investment has come in. New opportunities have opened for people of all ages.
"We have responded positively—following advice from the Chief Constable and the General Officer Commanding—to the much reduced threat to security. By the end of this year half of the Army's emergency or roulement battalions will have left Northern Ireland. Security infrastructure has been dismantled. Remission rates for scheduled offenders have been returned to their pre-1989 levels.
"But, though we have a ceasefire, we are still far from a comprehensive political settlement. To work towards that, we must establish a negotiating process open to all democratic parties. That aim underlies the twin track initiative which we have now launched with the Irish Government.
"The first of the two tracks in the joint communiqué will involve invitations to the parties to intensive preparatory talks. These are not substantive negotiations on Northern Ireland's constitutional future. They are designed to prepare for such negotiations.
"There are many issues to be resolved if substantive negotiations are to take place successfully. The preparatory talks will consider the best structure and format for all-party negotiations, and how those negotiations can address all the relevant relationships in an interlocking three-stranded process.
"Several of the parties in Northern Ireland have suggested that an elected body could play an important part in all-party negotiations. Other parties disagree. As the communiqué makes clear, this is an idea which will be discussed in the preparatory talks.
"As I have indicated, meeting the requirements of paragraph 10 of the Downing Street Declaration will be an essential condition for any party claiming a seat at all-party negotiations. Not all of the parties yet do so. This too will be a valid subject for discussion in the preparatory talks.
"The format for these talks is intentionally flexible and permissive. We shall build on the exchanges and bilateral contacts which have already taken place. We shall treat each party equally. Exchanges can be bilateral or, where the parties so wish and where it will further the objectives of the preparatory talks, they could be multilateral.
"This new round of preparatory talks is an opportunity for each of the parties in Northern Ireland to express its view, in whatever format it chooses, on the best way of moving the political process forward. It is an opportunity for them to work together with one or other or both governments, according to their wishes. It is an opportunity to generate fresh momentum. It threatens no one, no interest and no party. I hope that all of the parties, in their own way, will take advantage of this opportunity. The objective of moving towards a just and comprehensive settlement will be of benefit to all.
"Let me turn now to the decommissioning of the weapons and explosives held in large number by paramilitary organisations linked to political parties in Northern Ireland.
"Before the Downing Street Declaration and the ceasefire, we recognised that the need to address this question was one of the practical consequences that had to follow the ending of violence. In a democratic society, political parties cannot be linked to private armies. In a society where parties are committed to exclusively peaceful methods, there can be no need and no justification for holding illegal weapons and explosives. In a democracy, parties and governments cannot be expected to negotiate under the duress of an implicit threat of a return to violence.
"For that reason, we have throughout this year sought to engage the representatives of both Sinn Fein and the Loyalists in an exploratory dialogue on how their weapons will be taken out of commission. In order to achieve more progress in that area we have now agreed with the Irish Government to establish an international body to provide an independent assessment of the decommissioning issue and have given it specific tasks.
"The body will consist of three members under the chairmanship of Senator George Mitchell from the United States. They will act in a personal capacity and on an advisory basis. The body has been asked: first, to identify and advise on a suitable and acceptable method for full and verifiable decommissioning; and, secondly, to report whether there is a clear commitment on the part of those in possession of such arms to work constructively to achieve that.
"We expect the body to invite relevant parties to submit their analysis of matters relevant to the decommissioning issue. The governments are not setting limits to the scope of the submissions which

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may be made to it. It will be for the international body, in reaching conclusions within its remit, to consider such evidence on its merits.
"We will not be asking the international body to question the Government's position on what has become known as the third Washington criterion. The body has not been established to make recommendations on when decommissioning should start. That is a matter for a government decision; and, as I have indicated, it is properly a matter for discussion in the preparatory talks.
"To avoid any doubt, let me stress that the Government stand by the three criteria on decommissioning which my right honourable friend set out in Washington earlier this year. We cannot see a way of securing the necessary confidence to bring all parties to the negotiating table without a start being made to the decommissioning of illegal arms. This is not a matter of dogma but of practicality. It goes without saying that we, like the Irish Government, will consider constructively any practicable suggestions that could help bring all parties into negotiations on the basis of the Downing Street Declaration.
"It is no secret that yesterday's agreement between the two governments required long and difficult negotiations. The British and Irish Governments agree on the need for disarmament by the paramilitary organisations but have an acknowledged difference of opinion over its timing. We have decided not to allow that difference to stand in the way of forward movement along these twin tracks. That is a measure of our determination to continue working together.
"We have asked the international body to report by the middle of January. We hope that progress in both tracks will then enable the two governments to launch all-party negotiations by the end of February. That is our firm aim. I am confident it is attainable, but it will require a serious commitment by all concerned.
"We are ready to make that commitment. But let me make a crucial point. The British and Irish Governments cannot make peace in Northern Ireland. Our role in the process is to facilitate it.
"We have borne a great deal of the burden. We have been ready to take risks for peace. Now is the time for others to do so as well. Now is the time for all parties and groups to make a sincere and constructive contribution: for the paramilitaries on both sides to give not merely qualified verbal assurances but a real and tangible commitment to peace—if they mean peace, they do not need guns and semtex; for all political parties to enter the preparatory talks, not with rigid and irreconcilable postures, but with a will to make them work. Because ultimately a lasting and peaceful settlement is in their hands, not mine. Let them all have the courage to grasp it".
My Lords, that concludes the Statement.
3.50 p.m.
Lord Richards: My Lords, I start by thanking the noble Viscount the Lord Privy Seal for repeating the Statement made by his right honourable friend in
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another place. Noble Lords on all sides of the House will wish to join me in paying tribute to the Prime Minister and to the Taoiseach for their commitment to the peace process and for the spirit of co-operation between the two governments which culminated in today's announcement.
The twin-track approach offers a real opportunity to help move forward the resolution of a conflict which has blighted the history of Northern Ireland for many years. We on these Benches sincerely hope that the proposal announced today will lead to further progress being made. We are all aware that the peace process will inevitably involve lengthy negotiation and that it has to deal with a number of difficult issues. The decision therefore to adopt the twin-track approach should be welcomed. We hope that such an approach will build up trust and confidence between the different parties to the negotiations. I entirely agree that that is vital if the peace process is to be successful and if the problems facing Northern Ireland are to be resolved.
Perhaps the noble Viscount will answer one or two specific questions to enable me to understand properly what is involved. As I understand it, there are to be two processes which will go ahead separately but be linked to the overall attempt to reach a peace settlement in Northern Ireland. First, in connection with the political negotiations, am I right that the talks about talks will take place before the international commission reports in mid-January; or, alternatively, will the international commission make its report on the decommissioning of arms before the talks about talks begin?
As I understand the position, the political talks will start immediately; then the decommissioning—I almost said "decommissioning commission", but that is perhaps not the happiest way of putting it—the Mitchell Commission will pursue its work and report in mid-January at a time when the talks about talks will still be continuing.
Secondly, is it possible for the Lord Privy Seal to give us an indication of who the other two members of the Mitchell Commission are to be? Will they be people drawn from outside or inside these islands? I am also a little unclear about the terms of reference of the Mitchell Commission. According to the Prime Minister it has been asked to,
"identify and advise on a suitable and acceptable method for full and verifiable decommissioning".
That means that the commission is to look at the way in which that can be achieved. It is then asked to report on,
"whether there is a clear commitment on the part of those in possession of such arms to work constructively to achieve that [decommissioning]".
As I understand it, the commission is not expected to say when such decommissioning shall take place, nor indeed to say how that commitment to decommissioning fits into the other negotiating process—that is, the talks about talks which one hopes will lead to all-party talks.
Those are questions on detailed procedure. But in this, as in many other issues, your Lordships will appreciate that they are critical to the way in which progress can be made. We give our full backing to the process. We hope that it will continue to gain momentum and

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produce a settlement which will in the end bring peace, stability and reconciliation to the people of Northern Ireland.
Finally, I shall be grateful if the Lord Privy Seal can give us an indication of what the Government's attitude will be to the status of decisions made by the international body under Senator Mitchell. Can he say a little more about the timetable for creating that body? Subject to those questions, some of which are detailed, we support the Statement.
Lord Holme of Cheltenham: My Lords, from these Benches I add our support to that expressed by the noble Lord, Lord Richard, for the Statement and for the initiative that has been taken. Also, I express our warm congratulations to the Prime Minster and the Taoiseach for this agreement reached at the 59th second of the 11th hour before the visit of President Clinton. All of those who follow the affairs of Northern Ireland will know that we should not look for rapid progress. It is a long-standing, deeply rooted, historical dispute and nothing will happen suddenly. We must be prepared for a long haul. On the other hand, as the noble Viscount said in presenting the Statement to us, momentum and movement are essential, and the agreement represents momentum.
I am bound to say that in some ways that momentum was achieved by pushing the problem forward into some point in the future. As an agreement, it has some of the characteristics of the device much disliked by lawyers of an agreement to agree or, in this case, an agreement to disagree. But at the present juncture it is more helpful than not that we have momentum.
I do not suppose the Government feel particularly happy about the last minute alarms and excursions by which they arrived at this point. The great change in the past 12 months, from the time of the framework document, is the fact that in some ways Sinn Fein has drawn a wedge between the two governments. The most notable fact 12 months ago was that the two governments held together solidly and provided a centre for this difficult process. It can no longer be said that that is the case. To that extent I fear that Sinn Fein may have succeeded to some extent in its mission to drive a wedge in between the partners who must see the process through.
I hope that the noble Viscount will not find it too cynical if I ask whether the agreement would have been arrived at in this rather melodramatic way if it had not been for the visit of the US President. Like other noble Lords, I welcome the visit of President Clinton. I felt that he made an extraordinarily good speech this morning and believe that he and the United States have a constructive role to play in Ireland and Northern Ireland, not least in the matter of economic assistance. But we must not allow anybody to persuade us that anybody can solve this problem other than the British and the Irish Unionists and Nationalists working together. This is not, nor should it become, a Bosnia where we are dependent on the United States for leadership.
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Perhaps the noble Viscount can answer two specific questions. The Statement and the communiquémentioned the elected body as a possibility. We on these Benches are in favour of an elected body in Northern Ireland; it will allow the opinions of the people of Northern Ireland to come into play and not simply the political leadership. For instance, if Sinn Fein were to fight an election for an elected body, it would have to answer questions on public platforms as to whether it has given up the use of violence for ever and is prepared to come to talks on a peaceful basis. There is therefore much to be said for an elected body. Do the Government contemplate, to the extent that this has been discussed, that that body must be an elected assembly or can it simply be an elected body constructed for the specific purpose of a short-term and specific brief?
My other question relates to the decommissioning point. There seems to be a difference of emphasis between the communiqué issued by the Prime Minister and the Taoiseach and the Statement we heard this afternoon. Is the Mitchell Commission—to use the description of the noble Lord, Lord Richard—free to make recommendations in respect of what we have all learnt to call Washington 3? Is it free to do so or not? I shall be grateful for the Minister's reply.
I hope that I have not appeared too grudging in my welcome. This is a difficult moment and it does advance the process. But does the noble Viscount agree that the key is to get the democratically elected representatives of the Unionist and Nationalist communities of Northern Ireland to start talking to each other? If they did that bilaterally, then the point of initiative would move. The great danger is that the initiative rests too much in the hands of terrorists or former terrorists and their associates and too little in the hands of the people and the elected politicians of Northern Ireland.
Viscount Cranborne: My Lords, I am most grateful to the noble Lord, Lord Richard, and to the noble Lord, Lord Holme of Cheltenham, for their most generous—I do not think the noble Lord, Lord Holme, was in the least bit grudging—welcome for the progress that was achieved late last night. In particular I shall pass on to my right honourable friend the Prime Minister the most eloquent tribute paid to him by the noble Lord, Lord Richard, for which I am very grateful and for which I know my right honourable friend will be grateful too. I welcome the wish of both noble Lords to see further progress. I am delighted that the noble Lord, Lord Holme, understands the need for trying to maintain a form of momentum—something which underlines this agreement. I am also grateful to both noble Lords for their welcome for the twin-track approach.
I was asked a number of specific questions. The noble Lord, Lord Richard, asked me about the precedence which each of the twin tracks would take over the other. The idea, which I think was touched on in the Statement, is that these two matters could and should proceed in parallel, that in a very few days indeed, in the wake of this agreement, exploratory talks should begin and that the international commission under the chairmanship of Senator Mitchell should be appointed and begin to sit.

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The noble Lord, Lord Holme, asked me about the other two members of the commission. I hope he will forgive me if I do not trail any names at the moment. A number of names are being considered. I can confirm that both the other members of the commission will come from outside the British Isles.
With regard to the terms of reference, both noble Lords asked me in different ways about what has come to be known in the jargon as Washington 3. Perhaps I may trespass on the patience of the House for a moment by trying to make clear what the remit of the international body will be, particularly in relation to the third criterion enunciated in Washington. Both Governments have given the international body a remit to provide an independent assessment of the decommissioning issue. We have set down in paragraphs 6 and 7 of the communiqué the specific requirements for the body's report. It may be worth while if I once again repeat those requirements.
They are, first, to identify and advise on a suitable and acceptable method for full and verifiable decommissioning; and, secondly, to report whether there is a clear commitment on the part of those in possession of such arms to work constructively to achieve that. I ought to make it clear, as the communiqué makes clear, that it will be for the international body to determine its own procedures. The two governments expect it to consult widely and to invite relevant parties to submit their analysis of matters relevant to the decommissioning issue. Their analysis will go as wide as they like. But the commission itself, in reaching its conclusions within its remit, should consider such evidence on its merits and within the remit. It will be for the commission itself to make that judgment about what part of the evidence falls within its remit. I should emphasise that it is agreed between both governments that the body will not question our position on the third Washington criterion. It was not established to make recommendations on when decommissioning should start. We believe that that is properly a matter for discussion in the preparatory talks and for a government decision. Indeed, the communiqué issued by both Prime Ministers makes that perfectly clear.
The noble Lord, Lord Richard, asked about the status of the recommendations. I should emphasise that they are purely advisory. The timetable of February which has been agreed is one which we hope can be achieved, because momentum, as the noble Lord, Lord Holme, said, is important. But it is a target. It is not a deadline but a target and it is one which we shall certainly do our best to make sure is achieved.
The noble Lord, Lord Holme, asked whether there was a wedge between the governments. I think it is clear from the Statement that there was a difference of emphasis which was clearly acknowledged by both Prime Ministers. I do not think there is anything new in that. However, that difference of emphasis is, as the Statement said, one which both Prime Ministers—this was clearly so last night—wish to emphasise should not stand in the way of the momentum which the noble Lord himself emphasised is so important.
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As to whether the agreement would have been arrived at if the President of the United States had not been due in London this morning, I leave for the House to judge. I would merely say that this agreement has been a very long time cooking. Progress has been made over the past months and weeks. We had hoped that an agreement might have been possible as long ago as September. I think both Dublin and London were hopeful that that might be possible. Unfortunately, there were some details which needed agreement and those details, fortunately, appeared to be capable of resolution over the past few weeks. It was clearly helpful and appropriate that if possible—it was not essential—that agreement could be arrived at for the President's visit. However, it was not, I think it is right to say, the catalyst which brought it about. There was good will from both sides of St. George's Channel.
Perhaps I may also take this opportunity to say how much I agree with the noble Lord, Lord Holme, in the welcome that he gave to the speech of the President of the United States this morning to the joint Session in the Royal Gallery. I am sure the whole House will agree that it was a magnificent occasion. We were honoured to hear a very fine speech in which, if I may say so, the President honoured us with a penetrating analysis of world problems and gave a very great deal of reassurance to all sides of your Lordships' House.
Finally, so far as concerns an elected body, the noble Lord, Lord Holme, will be aware that the United Unionist Party has for some time been interested in the question of an elected body. As the noble Lord said, no solution, including the device or mechanism of an elected body, can be imposed any more than any other kind of solution can be imposed. As the noble Lord so rightly said, these matters are for the people of Northern Ireland. If it is proposed that an elected body is a sensible way forward, whether it be by means of an assembly or what I might loosely call a convention, that is something for agreement. It is not something which Her Majesty's Government would in any way wish to stand in the way of if it appeared to be a way forward to which all parties could agree.
Viscount Whitelaw: My Lords, this is a very difficult moment for Ireland and indeed for all concerned in it. I therefore welcome very much the determination to try something which has to be tried because this problem cannot be allowed to go on and on. We have to make every effort to seek to achieve a solution. I believe that it can be achieved and therefore one ought to congratulate the Prime Minister for having taken a very difficult decision indeed. I also believe that the Taoiseach had a difficult decision, too; but probably the Prime Minister's decision was the more difficult of the two.
It is the right course to take because in Ireland everything is difficult. It is no good just saying, "it is difficult". If one wants to spend time arguing about petty views here and there, one will always be able to do so. That is never difficult, and one has a certain amount of experience of that. I very much welcome the fact, as the noble Lord, Lord Richard, said, that the Labour Party support the Government. I heard that in the other House they also support the Government, and that is right.

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We have a chance to make a success on this issue and that is why I very much welcome what has been done although there are still very great anxieties ahead.
Viscount Cranborne: My Lords, I am most grateful to my noble friend for what he has said. He perhaps has as much experience as anyone in your Lordships' House on this intractable question. I am most grateful to him for his support. It is by no means certain that we shall succeed, but we should remember that the longer we are able to make progress, fewer people will die or be maimed both in the Province and on the mainland.
Lord Mason of Barnsley: My Lords, first, I join with my noble friend the Leader of the Opposition in congratulating the Prime Minister and the Northern Ireland Secretary for concentrating many efforts and many hours of endeavour in trying to maintain the peace process.
Secondly, in the press this morning a breakthrough was mentioned. I urge the House to treat that word with the utmost caution in this matter. Is the Minister aware that I note from what he said that an international body will be set up to advise on disarming the Provisional IRA and that the Provisional Sinn Fein will be allowed to take part in talks to set the agenda for full-scale discussions on the future of the Province—the twin-track approach?
Is the Minister further aware that as regards the first point the Provisional Sinn Fein will have to answer that a clear commitment exists to work constructively towards the decommissioning of arms, and then—and only then—will they be allowed to enter into the preparatory talks which may eventually lead to substantive talks? Is he also aware that they are not prepared to move on decommissioning—not now, and it is doubtful in the future? That is the major sticking point because to the Provisional IRA it is the signal of surrender and so far they see nothing in return. That is the major obstacle which has to be overcome.
Finally, on the twin-track approach, in previous discussions with the Prime Minister, have not the Unionist parties turned that down? Do I gather now that their views have changed or are changing?
Viscount Cranborne: My Lords, I am constantly reminded, in sessions of this kind in your Lordships' House, of the care with which I have to approach making statements because of the very large number of former Secretaries of State that there are about on any given subject, and the noble Lord is no exception.
I am grateful to him for the congratulations that he gave. I certainly agree with him about the indiscriminate use of the word "breakthrough". I would rather publicly expect little, and for those expectations to be exceeded rather than the other way round. Nevertheless, I believe that the word "breakthrough" was perhaps justifiable in one sense in that this has been a difficult negotiation, as many of your Lordships have acknowledged this afternoon. It looked at one moment as though it was going to be difficult to translate the goodwill of both sides into something concrete. To that extent I believe
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that the word "breakthrough" is justified, but I certainly agree with the noble Lord's clear implication that we are not there yet and that the difficult part is still to come.
Perhaps I may change the emphasis of one part of what he said. The second part of the twin-track—the "talks about talks" as the noble Lord, Lord Richard, called them—does not allow Sinn Fein to set the agenda. They are exploratory talks to see whether we can agree on the agenda for the substantive round table talks which we hope will follow. Sinn Fein does not have a monopoly on setting that agenda; indeed, I suspect that unless, for instance, the present constitutional parties were all able to agree as well, the term "round table talks"—if Sinn Fein were to be the only people there—would be the ultimate misnomer. Therefore, I say to the noble Lord that for them to say that they will set the agenda is not strictly right.
Of course, decommissioning is a major obstacle. I should like to emphasise that Her Majesty's Government have in no way changed their stance on this matter. At the very beginning they made it clear that there will have to be clear and substantial progress towards the decommissioning of weapons before the parties who were identified with terrorist organisations can take part in round table talks for the reasons that my right honourable friend gave in his Statement. That position has in no way changed, and I hope that the noble Lord will be reassured by that.
Lord McConnells: My Lords, I also wish to welcome the Statement that has been made by the Lord Privy Seal. I believe it is true to say that virtually everyone in Northern Ireland has a burning desire for a permanent peace, and the Ulster Unionists are second to no one in that desire. I was glad to hear mention of an elected body. That is a suggestion which was made recently by the leader of the Ulster Unionists in the other place. I believe that that might be a useful move in securing a permanent peace because any peace must be a permanent one and on sound foundations.
I am also glad to hear that the Government are standing firm on the question of handing over private arsenals and decommissioning, not merely in the sense of armaments, but also as regards the personnel of some of these gangs because there may not be so much shooting going on, but there is still a great deal of beatings up, intimidation and terrorising people. Unless that stops we cannot have a real and permanent peace. That problem has to be addressed somewhere in the process.
I also welcome the establishment of a commission. I am glad to hear that the Government have not handed over their responsibility, but that this commission will be advisory and that the Government will, in the end, have to make the decisions. I look forward to a permanent peace, which I hope that we can achieve, that is fair to all parties and all people in Northern Ireland.
Viscount Cranborne: My Lords, I am most grateful to the noble Lord who of course speaks with obvious authority on these matters. Perhaps I may refer to the intervention of the noble Lord, Lord Mason, a moment ago. It is interesting that, as an Ulster Unionist, the noble Lord approved of the twin-track approach.

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I believe that I was right in hearing the security spokesman for the Ulster Unionists imply on television last night that they were one of the original begetters of the idea of a twin-track approach. So it is clear that the noble Lord's party is behind that particular initiative. I am grateful for the confirmation that the noble Lord has given us today.
I am also grateful to the noble Lord for his acknowledgement that the elected body could be a useful move. Indeed, that idea has been very much promoted by Mr. Trimble, the leader of the Ulster Unionist Party. There is no doubt that that is something that cannot be imposed. As I said earlier, it must be done by negotiation.
I should like to emphasise how very much I agree with what the noble Lord said about the continuing violence in the Province. Shootings have decreased as, thank God, have bombings, but we should be aware that, far from diminishing since the cease-fire, the problem of punishment beatings has worsened. I am told that, in total over the past 16 months, Republican attacks have been running at almost twice the level of the equivalent period last year—about 150 as against about 85—and that Loyalist attacks are still occurring also. Such attacks are clearly designed to assert the terrorist gangs' control over what they term "their" communities. Therefore, there is a distinctly political element to those attacks. The brave individuals who have risked reprisals by daring to criticise that practice deserve our most fervent admiration.
Lord Merlyn-Rees: My Lords, I too congratulate the Government on the steps that they have taken and wish them well. However, I am not yet clear on one point. Yesterday evening I was watching the news and I then watched "Newsnight" and in came reports about what was happening between the Taoiseach and the Prime Minister. Eventually it got to midnight and I listened to the midnight news. I asked myself and my wife, "What's new about all this?" because the twin-track approach has been going on for weeks. Even when I went to sleep I was not clear about what was new. Is it the preparatory talks as opposed to the multilateral talks? Indeed, are the parties going to turn up for those preparatory talks? Have we asked the parties whether they will participate in those preparatory talks? I am still not clear.
On the election, I discussed that proposition with a number of Irish TDs and British Members of Parliament on the Border the other evening when we were looking at policing there. I cannot speak for them but, speaking for myself, there is a worry. There were convention elections in 1975 and I think that the statute is still in the law books. That did not succeed because, when people vote for a convention, they are not voting for a Christmas tree being lit up in Belfast; they will vote along these lines: "We are going to vote for our people on the Loyalist side" and similarly on the Nationalist and Republican side. Let us not run away with the idea that an election will bring sweetness and light simply because everybody is pleased that Northern Ireland is quiet. Some of us have held the view that that might harden the situation.
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I am glad that the international body is to be independent, but I hope that its members know something about Northern Ireland and that they will not confuse it with Bosnia or Palestine, because it is a different place. What might be appropriate in another place may well not be appropriate in Northern Ireland. I hope that we shall ask that body to consider the question of the shootings in recent weeks which have involved illegal arms. The noble Viscount has given us evidence of the great growth in the number of such shootings in recent weeks. If there are illegal arms that we want to decommission, it would be just as well to ask the IRA—or Sinn Fein, its political wing—or the UVF—or its political wing: who is doing all those shootings? Where are the arms being held? We must ask those questions because there was a continuation of violence in 1922 and the same thing happened in Europe at the end of the war when there were great problems in bringing in arms from the Maquis. It is not nice and easy. Therefore, when I congratulate the Government, it is because they are still talking. I have grave doubts—not about what the Government are doing, but about what will come out of it.
Viscount Cranborne: My Lords, certainty in politics is an oxymoron, and particularly so in Irish politics. I am sure that the noble Lord is right on that point. The noble Lord asked what was new about the twin-track approach. That phrase now seems rather old hat because it has been so extensively trailed in the past few months. The "twin-track" idea has been in the air and has been commented on in the press for some time. What we have not had so far has been an agreement about how to proceed with it. That is what is new. We now have an agreement about how to proceed and some pretty detailed thoughts about the process.
I wholly take the noble Lord's point about the three commissioners and whether they will know anything about Northern Ireland. That could be an advantage as well as a disadvantage. Coming from outside the British Isles gives the three commissioners some distance from the problem. To take the name that we know, Senator Mitchell, I think that his record stands for itself. He is extremely knowledgable about Irish politics. Indeed, the fact that he comes from the north-east of the United States underlines that point.
I am grateful to the noble Lord for what he said about punishment beatings. I think that we are all aware of what has happened. I take very much to heart the noble Lord's view that success is far from a certainty, but I accept wholly that he thinks that it is well worth making the effort.
Lord Monkswell: My Lords, I too thank the Lord Privy Seal for repeating the Statement. We all wish and hope that positive progress will result from the new initiative, if I may describe it like that. My question is whether a novel approach to the problem of the decommissioning of illegal weapons—I use those words advisedly—might be acceptable to all the parties involved. Although the noble Lord, Lord Merlyn-Rees, pointed out that the situation in Northern Ireland is very different from that in Palestine or South Africa, I think that there are some similarities in the sense that people

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with strongly held political convictions have felt it necessary to try to defend and to put forward those political principles by force of arms. As the noble Lord, Lord Merlyn-Rees, also pointed out, the problems did not go away in 1922 with what appeared to be a political solution.
The novel solution that I wonder whether we might advance is to consider whether the word "illegal" might be regarded as the significant word rather than the word "decommissioning". Could we consider the possibility that those arms that are currently considered to be illegal, bearing in mind that a great number of arms are held legally, might in some way be converted into legal holdings? Obviously, strict conditions would need to be applied. The fundamental question is whether the new commission will be able to put forward novel solutions to the problem.
Viscount Cranborne: My Lords, the phrase used is:
"decisions taken last summer and autumn by those organisations that previously supported the use of arms for political purposes",
which implies illegal weapons.
Lord Dubs: My Lords, I very much welcome the Statement, which referred to the possibility of setting up a new elected body. Of course, I am not against that, but may I urge caution about the speed with which we proceed? There may well be groups in Northern Ireland which will need time to prepare themselves in order to enter a democratic election. Rushing at it too quickly might debar some of those groups from a fair opportunity.
Viscount Cranborne: My Lords, I am sure that everybody will have noted what the noble Lord has said. It is clear that such agreements can proceed only by consensus. I am sure that we are all aware of the very real difficulties that are attendant on that potential course of action.

Social Security
4.30 p.m.
The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish): My Lords, with the leave of the House I should now like to repeat a Statement being made in another place by my right honourable friend the Secretary of State for Social Security. The Statement is as follows:
"With permission, Madam Speaker, I would like to make a statement on social security following my right honourable and learned friend's Budget Statement.
"When I became Secretary of State for Social Security, expenditure on social security had been growing on average 5 per cent. a year faster than inflation since the welfare state was founded. As a result it has taken an ever-growing share of national income. So it has been the engine for rising taxes. Social security now costs the average working person £15 every working day. That is why, when I became
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Secretary of State for Social Security, I launched my programme of step-by-step reform. Those reforms are having an effect.
"Over the next three years, spending should grow by little over 1 per cent. per annum, well below the growth in the economy. So it will be a declining share of national income. It will leave scope for sustainable reductions in taxes. That in turn is the best of all ways to stimulate activity in the economy, to create employment and to reduce benefit dependency. Next year, planned spending on social security will be £90 billion. That is the figure I announced last year and is below the plans of two years ago. It includes nearly £3 billion to finance increased benefit rates. This is £600 million more than anticipated last year because it is based on the September inflation rate, which jumped to 3.9 per cent. and has since fallen back to 3.2 per cent. The measures I am announcing today will save nearly £500 million in 1996/97 and over £1 billion in 1998/99. Altogether, my reforms to date will save £3.5 billion next year. And by the turn of the century, they will save £5 billion a year.
"To be able to help those in need we have to stop fraud. Despite tough control on overall running costs I am channelling extra resources to the battle against fraud. Last year the Benefits Agency detected and stopped a record £700 million of fraud. And local authorities doubled their savings to £170 million. But prevention is better than detection. I am therefore pursuing an anti-fraud strategy based on prevention and deterrence. In total my anti-fraud measures across all benefits will save £2.5 billion by 1998/99.
"The Benefits Agency has just started deploying one of the most powerful data matching systems in the world to identify suspicious claims. The agency will investigate these and carry out over 1 million home visits and other checks. It will tackle employers who collude with people claiming unemployment benefits while working. And next year, we will start computerising post offices and launch the benefit payment card.
"Local authorities have responsibility for administering housing benefit. A recent study suggests housing benefit fraud costs almost £1 billion a year. So I will strengthen the financial incentives for local authorities to tackle fraud. I will invite local authorities to compete for challenge funding for innovative anti-fraud measures. And next year I will introduce a national computer record of housing benefit claimants. This will stop people claiming from more than one local authority.
"From October 1996 further changes in housing benefit will reduce abuse and waste. Some tenants abscond without making initial payments to landlords. So I shall enable local authorities to make the first giro payable to the landlord. Most other benefits are already paid in arrears. I shall align housing benefit with them. This will stop wrongful payments that can arise when housing benefit is paid in advance.
"In October, I announced proposals to limit asylum seekers' access to benefits; 70 per cent. of people claiming asylum do not arrive as refugees, but make

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a claim some while after entering the UK illegally or as tourists, students or visitors. From next year, I intend to allow benefit only for people who claim asylum as they enter the UK. But when a claimant is found not to be a refugee, benefit will cease. My proposals will save £160 million next year. My right honourable and learned friend the Home Secretary is speeding up asylum decisions, which will further reduce the benefit cost. We will offer refugees a sanctuary, but not be a soft touch for social security.
"The past two decades have seen a huge increase both in the number of lone parents and their cost to the taxpayer, expected to be £9.4 billion this year. This is equivalent to over £1,500 a year extra tax on each working family with children of its own. The right approach is neither to penalise nor to promote lone parenthood. The benefit system gives special assistance for lone parents which couples do not have. In particular, two components of benefit for lone parents have no equivalent for couples. These are one parent benefit and lone parent premium. They cost around £600 million a year. To start bringing treatment of one parent families and two parent families more into line I propose no increase in either benefit next April. My intention over time is to continue to narrow the gap between the benefits which go to lone parents and those which go to couples. At the same time I intend to build on our existing measures to help lone parents back to work.
"Family credit has been of particular benefit to lone parents and I have greatly improved it. I have extended family credit to people working part-time. I have given an extra £10 a week to people working full-time. I have introduced a £40 a week allowance for the cost of childcare. And I now propose to increase the allowance to £60 a week. This will be of particular benefit to those who wish to return to full-time work and those with more than one child.
"The provision of nursery vouchers will be an additional help to parents of pre-school children. Maintenance is also an important stepping stone to work. Even absent parents on benefit should contribute to their child's support. So I propose to double the minimum payment of child maintenance to £4.80 a week from April 1996. In addition, from April 1997, I shall pilot a major new scheme. It will provide individual help for up to 25,000 lone parents to find jobs or training opportunities. Finally, my right honourable friend the Secretary of State for Education and Employment will extend the very successful scheme which has already created places to care for 50,000 children out of school hours, creating a further 18,000 places over the next three years.
"As a result of the reforms already implemented, the proportion of lone parents in work has increased. I believe the four measures I have announced today will help more lone parents be self-supporting.
"Most young people starting out in work either stay with their parents, share a flat or find a bedsit. But those who are without a job can claim housing benefit and can then choose to occupy better properties than they could afford in work. So for single people under
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25 who are renting privately, I propose to limit housing benefit to the average cost of local shared accommodation. That will reduce disincentives to work; discourage young people from leaving home before they can afford to do so; and reduce the attraction of moving to seaside resorts. The changes will apply from next October.
"Couples, people with children and those exempted from the January housing benefit changes will not be affected. Local authorities will be given funds to prevent hardship in exceptional cases. The new scheme will save more than £100 million over three years. Last year, I announced a scheme to continue maximum help with housing benefit during the first four weeks of work. I am now extending it to people who have been on a government training course. In a separate measure I intend to increase non-dependant deductions for housing costs.
"The state system of social security provides decent help for those who need it. The voluntary and charitable sectors provide extra help to cope with unusual circumstances. Voluntary bodies and charities can already pay £10 a week without the recipient losing benefits. I propose to double that limit to £20 a week. I believe this change will be widely welcomed.
"I propose some smaller measures to remove anomalies. I shall amend the industrial injuries benefit scheme so that those who receive reduced earnings allowance to compensate for loss of earnings should normally transfer to retirement allowance when they reach pension age.
"Separately, I shall align the mobility component of disability living allowance more closely with similar benefits that are withdrawn during hospital stays. And I shall improve the information-gathering used to make assessments for disability living allowance.
"Britain already has one of the lowest non-wage labour costs in Europe. I intend to reduce them further. From April 1996, employers will qualify for one year's remission from employers' National Insurance contributions for each person they take on who has been out of work for two years or more. I am cutting National Insurance Class 4 contributions for self-employed people by 1.3 per cent. from April 1996. This outweighs the loss of tax relief on these contributions announced by my right honourable and learned friend the Chancellor. And, finally, I intend to cut the main rate of employers' National Insurance contributions by 0.2 per cent. from April 1997.
"One of the main financial concerns facing elderly people is the prospect of long-term care. Providing for their needs in old age is, of course, one of the reasons why people save. But Age Concern and others have argued that the capital limits applying to people in residential and nursing care are tougher than the rules for people who stay in their own homes. They have urged us to raise the capital limits for residential and nursing care to those applying to housing benefit. We have gone further than that, not just doubling the upper limit to £16,000 but more than tripling the lower limit.
"Under our proposals, people with up to £16,000 of assets will qualify for state help. And people with capital of less than £10,000 will not be required to make any contribution from their capital towards the cost of residential care. The new limits will apply from April 1996 at the latest to all people in long-term residential care or nursing homes. Around 50,000 people should benefit in the first year. We want to ensure that in future more people can afford care.
"One of this country's major successes has been encouraging more private pension provision than any other European country. The challenge facing us is to be equally successful in enabling people to make decent provision for long-term care. We are announcing three important proposals to stimulate the development of attractive savings and insurance schemes.
"First, benefits from long-term care insurance will be tax free. Secondly, my right honourable and learned friend the Chancellor is consulting on how occupational pension schemes can enable pensioners to defer some income early in retirement so that they have more income to help with the cost of long-term care. Thirdly, we will consult on partnership schemes. These would enable people to retain even more of their own assets in return for providing for a corresponding amount of their long-term care costs. This would encourage more people to make provision for themselves. It would help the insurance market develop new products, since their risks would be limited.
"Today's measures continue my step-by-step reforms of social security. I have protected the most vulnerable. And I am creating a fairer and more modern benefit system. But our aim is to help more people off benefit altogether. We are succeeding. We have fewer people out of work than in any other major European country. And more people in jobs. My reforms make a double contribution to this. They strengthen work incentives and encourage more people off welfare and into work. By controlling spending, they are easing the burden of taxes and helping to create a vibrant, free enterprise economy. This gives people a chance to find a job and provide for themselves, which is the best help we can give them. And it means that we can afford fair provision for those unable to work. My reforms give them a greater chance. I commend them to the House".
My Lords, that concludes the Statement.
4.44 p.m.
Baroness Hollis of Heigham: My Lords, I thank the Minister for repeating the Statement made to another place. The Statement was wide-ranging and, obviously, I, on behalf of these Benches, will be able to pick up only some of the points that were raised. Perhaps we may revisit others during Questions and debates at a later stage.
We are discussing the Social Security Uprating Statement in the context of yesterday's Budget. The basic question is, running the two together, who pays
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and who gains? Looking at the Budget benefit package, any concept of fairness would ensure not only that such a package was progressive—that the rich paid more of their incomes—but that it was also appropriately redistributative—that the poor gained more.
What do we see? According to Social Trends, in 1979 local and central taxes took 31 per cent. of the incomes of the poorest one-fifth but 37 per cent. of the incomes of the richest one-fifth. One might think that that is fair. By 1993 the situation had been reversed. The poorest one-fifth were paying 39 per cent. of their income in taxes and the richest one-fifth were paying just 23 per cent. The consequence has been a widening of poverty and inequality and a divided Britain. The Budget confirms those trends.
As today's Financial Times showed, following yesterday's Budget the bottom 10 per cent. are worse off in real terms by about 50 pence per week, whereas the top 10 per cent. are better off in real terms by about £6.50 per week. Therefore, not only has the Budget failed to narrow the poverty and inequality gaps but it has actually widened them. Not only are the poor worse off as a result of the Budget but at each and every uprating Statement we are seeing their benefits being chiselled away, which is to the shame of us all.
A couple of years ago the uprating Statement chiselled away the benefits of the unemployed by taking them off insurance-related unemployment benefit and putting them speedily on to the means-tested JSA. It also took the sick and disabled off the more generous invalidity benefit and put them on to incapacity benefit. So those two groups were hit.
At last year's uprating Statement we heard an attack on those home owners who were trying to sustain their homes while being unemployed and on income support. They too have lost their benefits. At this uprating Statement, whom did the Minister single out a few minutes ago? It was those who are asylum seekers, those who are receiving housing benefit and those who are lone parents. That is where the cuts in social security will fall in order to achieve the tax handouts and the widening of inheritance privileges for the better off.
Perhaps I may deal first with asylum-seekers. The regulations to which the Minister referred will be introduced during the Christmas period, taking effect on 10th January. I hope that we shall have an opportunity to debate them in this House. They mean that approximately 70 per cent. of all asylum seekers—those who seek asylum once they are already in this country—will be denied income support. Between them they have approximately 5,000 children. If the parents of those children have no income, on what will the children live? The cost of giving Social Security at the reduced rate to an asylum family of four is something like £100 per week. To put one of those children into care costs something like £870 per week. Is that humane; is it decent; is it cost effective?
The reason why benefits for asylum seekers have risen is not because there are more bogus claims but because it takes the Home Office longer and longer to process them—in some cases up to seven years. Of

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course, as Andrew Lansley, the Conservative's director of research, was reported as saying in the Observer on 3rd September 1995, which is a couple of months ago:
"Immigration, an issue we raised successfully in 1992 and again in the 1994 Euro-election, played particularly well in the tabloids".
I invite the Minister in his reply to dissociate himself from that view. It gives the impression that attacking the benefits of asylum seekers is an activity of the racist Right. I invite the Minister in his reply to dissociate himself from that impression and I am sure that he will want to.
The second area upon which the Minister focused was housing benefit. Back in 1988, the Government deregulated private sector rents, promising, in the words of Sir George Young, that housing benefit would "take the strain". The DoE cut its costs and the DSS picked up the bill—a further additional £8 billion in housing benefit since then. The Government insisted, as the Minister repeated only a couple of days ago, that it was better to subsidise the individual than bricks and mortar. Having said that, the Government then look very surprised that, in the process, they create what they like to call a "dependency culture", in which people find it hard to move out of benefit into work because they face a penal tax rate of something like 90 pence in the pound.
The Government have already made one set of changes to housing benefit which will come in in January. In today's uprating Statement, they are attacking a particular group; namely, young people. First, I should like to ask the Minister the following question. As I understand the Statement, in future all housing benefit recipients will only receive benefit four weeks in arrears. How then will people on income support find the money to pay the month's rent in advance which is now virtually a requirement in the private sector? Secondly, the Minster announced that, in future, young people would get housing benefit which would only cover the cost of shared accommodation—not for a self-contained flat, only shared accommodation. What will be the consequences? I put it to the Minister that four possible options may follow, all of which, I suggest, are highly undesirable.
I start with the first option. If the young person concerned is "go-getting", he or she will leave the self-contained flat and share a larger property with two or three people. Those young people will pool their income and rent a family sized house. In consequence, many families will find themselves squeezed out of renting that family home. That is already the case in university towns. The Government are structuring the benefit to extend the problem more widely. I am sure that that is undesirable.
Secondly, if the young person concerned is less energetic, he or she may get someone to share the accommodation, thus illegally overcrowding their small flat. As we know, that will have implications as regards health, fire and safety. Thirdly, if such a young person is less able to hold his or her own in the housing game, he or she may end up homeless. The Government may say that such young people should go home to their families, but what they know from their own research—and what they conveniently forget—is that many of those young people have come out of care, have been
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abused at home and have no safe home to return to. The Government are refusing them the ability to afford an appropriate rent. Without a safe home, they may end up on the streets and, as we all know too well, in a vulnerable situation.
Of course, a few of those young people may return to their families. But what do we find? We find that in the very same uprating Statement the Government have substantially increased what is called adult "non-dependant deductions", which means that the parents of such a young person will lose an increased amount of their own housing benefit if their son or daughter of 22 or 23 returns home to live with them. They will not want him or her back—and this from the Government who claim to be the party of the family.
None of those outcomes is acceptable. The bill for housing benefit will only be cut when there is enough socially rented and cheaper property available on the one hand, and, on the other, rising incomes based on full employment. Until then, all we are seeing is a merry-go-round of government departments ducking responsibility for the social consequences of their budget cuts in the desperate hope that they can pass them on to someone else. Indeed, anyone else will do.
Finally, the Government's uprating Statement targets a third group. After asylum seekers and housing benefit recipients, it targets lone parents. The other day, when we were discussing earnings top-up, we congratulated the Government on using research. Why do they not do the same with lone parents? Let us remind ourselves that, despite what the Government suggest, lone parents are not idle like, unfortunately, some unemployed young men have to be. They are in work; indeed, rather important work. However, because it is unwaged, it is not visible. It is called bringing up children. I am not sure that it is wise social policy that the children, having lost one parent—usually the father—should now be expected to lose the other parent in order to cut the social security bill, especially when the mother is on poverty level income.
Let us also remind ourselves that the single parents who have been targeted are not feckless teenagers. The latter amount to something like 44,000 out of 1.3 million lone parents. The average age of a lone parent is 33. Most of them have come from broken marriages or separated partnerships. The average length of time that they spend on income support is less than three years. They are on income support and not in the labour market when their children are under five years of age. Only one-sixth of them with children under the age of five are attached to the labour market, but over half of them are in work when their youngest child reaches the age of five.
So what is the problem? The problem is not that such people are scrounging or that they are idle when they should be working: it has arisen because, for example, the lone parent is the mother who has been divorced late in life, perhaps in her fifties and, therefore, not regarded by prospective employers as an attractive proposition for employment, just as is the case with middle-aged men. Alternatively, such women may be ill-educated, untrained and have few skills for the labour market—

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and we should help them to gain them—or, and this is increasingly the case, the lone parent or the child may be disabled and therefore in need of full-time care.
I wish that the Government would use some of the energy that they expend in moral panics in reading their own research. The real problem with social security is not lone parents: it is disinherited young men. Of course we must help lone parents with education, training, and childcare, working with the grain of choices that they want to make. However, in today's Statement, the Government propose to freeze and ultimately remove two benefits—that is, the lone parent premium on income support and the single parent benefit—and deliberately make those families poorer.
What such changes will not do is send single parents back into marriage. Similarly, they will not send those parents back into the labour market. What they will do is ensure that the 2.5 million children who live in single parent families will be poorer. Is the Government's line really that to make marriage stronger they must make those children poorer? That seems to be the implication. Those children are already living in poverty. Therefore, to make them poorer still so that they inherit deprivation in exactly the same way that other more fortunate children inherit wealth is vindictive, punitive and utterly wrong—and all to save just £13 million of benefits in the first year.
Over and beyond the issue of fraud—and we entirely agree on this side of the House that it is not to be tolerated—the Government are spending too much on social security. That is evidence not of abuse but of the Government's economic failure, because they are spending on the wrong things. Social security expenditure is driven by unemployment. We do not want to spend so much on unemployment, but that is because we intend to ensure that people are back in work. We do not think that we should spend so much on housing benefit, but that is because we do not believe that rents should be deregulated in the way that they have been. We do not want to spend so much on in-work benefits like family credit, but that is because we would establish a minimum wage to ensure that that was not necessary.
We want to cut social security spending, but we know that in a humane society it can only be done by investing in the employment and education of our people and not by chiselling away at benefits in order to hand tax cuts to the better off. We remain a divided Britain, and this Budget benefit package is yet another wasted opportunity.
5 p.m.
Earl Russell: My Lords, I think we understand that there is no such thing as a free tax cut, so we need to make some attempt to balance the cost of having tax cuts against the cost of not having them. Getting the information for that exercise out of the Department of Social Security is sometimes like getting blood out of a stone, but we have to try.
I heard the Minister's figure of £15 a day. I have heard it before. I should like to ask how exactly that figure is arrived at. Does it, for example, include
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pensions, and, if so, is it perhaps rather cheap at the price? I understand that the social security budget is high but we must attempt international comparisons. I know those are extremely tricky because of the difficulty of getting a constant basis of comparison, but the National Association of Citizens Advice Bureaux has recently estimated that our social security bill is the lowest in Europe. No doubt the Minister has a different method of calculation and perhaps he will tell us about it.
I take, first, the case of under-25s and housing benefit—under-25s, as the Chancellor put it, not leaving home earlier than they should. I shall let the Minister into a secret. He will not win any votes from among the parents of those under-25s. Those under-25s are up to seven years past the age of majority. When one brings up children, one imagines that a time will come when they will launch themselves: they will leave home and be self-supporting. Most parents understand when their children do not have jobs that more blame rests on the state of the economy than on their children. It does not mean that they necessarily want to have them back at home for ever. They may find that the cost of doing so is a great deal higher than what they are receiving in their tax cuts—yet another case of there being no such thing as a free tax cut.
The Minister may by now be familiar with the MORI report on 16 and 17 year-olds published by his department. It found that a large number of parents who had thrown out 16 and 17 year-olds had done so because they could not afford to keep them, being themselves on benefit and because they could not keep the child unless the child was also on benefit. The measure we are discussing is likely to extend that pattern to those from 18 to 25. I cannot regard that as a great advance. I cannot regard it either—considering that the Government themselves are concerned about the cost of homelessness—as a great advantage to public saving. It will carry costs of its own.
Let us consider also the effect of people being induced to stay at home when they live in a remote place. There is not much work to be found in Woolfardisworthy, Devon. Therefore if one makes people from there stay at home, one will be keeping them out of the labour market and keeping them on benefit for a great deal longer than would otherwise have been the case. If they find work in such places it is likely to be work at rather lower wages than they might have found in a big city. Restricting the mobility of labour in some ways interferes with the operation of a free market. I take it that the Government have now finally thrown away and dismantled the bike of the noble Lord, Lord Tebbit. That is a pity because it was useful on occasion.
I am interested to note that there is an exemption here for marriage, which of course has created a colossal new incentive for marriage in this group. That means that sooner or later in the course of administering his drive against fraud the Minister will have to introduce a new primary purpose rule, with all the costs and administrative strains involved in administering that.

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I entirely agree with what the noble Baroness said about health, fire and safety. In that context I ask the Minister—I hope to get an answer and I shall ask again if I do not—when he applied the Treasury guidelines as regards the policy and resource implications for other departments, what resource implications for other departments were identified, and how did the department decide that they were less than the amounts being saved? We need an answer to that question.
I ask him that question also as regards the costs of the changes for single parents. I am also interested in the assumption clearly made in the Statement that single parents should be assimilated to the same benefit base as married couples, because in the 1985 White Paper which introduced the current premium system that was introduced because of the extra costs of being a single parent. I ask the Minister whether the department was wrong in 1985; or has something changed since then, and, if so, what and when? There are extra costs in being a single parent. A great many of them remain on benefit a year or two years and often up till the time the child is two.
Those of your Lordships who remember the experiment by Mr. Matthew Parris of living on benefit may recall that he reported that one could do it all right for a week but as one went on doing it longer, one found that as one's shoes and coat wore out one ran up big expenses which made things much more burdensome. That is something which particularly affects single parents. In that context I must ask the Minister how much new money is going into the Social Fund this year. Is there any increase on the previous year and, if so, how much?
As the Edwards case—the sex discrimination case involving London Transport, reported in this morning's paper—illustrates, single parents have to face extra costs through having to be in several places at once. Any of us who have had a spouse ill for even as much as a day or two know perfectly well that that is true. There are extra costs and some account ought to be taken of them. I am glad about the extension of the disregard on family credit. In other circumstances I would have welcomed it warmly but here it is simply paying Peter for having robbed Paul. It simply gets us back to where we were before.
I am glad that there is some concession on savings limits for the cost of care, but as most people's houses are worth more than £16,000, the effect will, I think, be extremely limited. It is possible more could have been done. We are told about fraud every year. Of course we must combat fraud. What I want to hear is that the combating of fraud will be subject to proper legal standards of proof, because I strongly suspect a mentality that says that if fraud does not exist it is necessary to invent it. It always seems to come up when there is a tight public spending round.
In that context I am a little worried about the proposal for incentives for local authorities to find fraud. That seems like something which could possibly create a conflict of interest. I hope care will be taken with the administration of that provision.
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I am also a little worried about the extension of home visits. There may be some people here who were unfortunate enough to face the noble Baroness, Lady Castle of Blackburn, holding forth about the old cohabiting rule. I say "unfortunate" only with reference to those who were on the other side of the House at the time. There is a danger here of abuse. It also gives me considerable anxiety that when the Benefits Agency in its review published totals of fraud, those totals were divided roughly 50:50 between confirmed fraud and suspected fraud. It is a little like the way they used to treat Roman Catholics in the 17th century. They said that they were vehemently suspected and slung them into prison. I do not regard that as compatible with the rule of law. There is a care to be taken here.
In the context of the increased deduction from income support for maintenance under the Child Support Act, I remind the Minister that this is directly a cut in income support levels. He knows the recent evidence from the National Consumer Council that those are not generous. It is difficult to have an adequate diet on full income support. Taking a further £2.50 out of it is taking out something that is not there. Medical costs may be attached to that provision, and I hope that in the use of the guidelines those were identified and calculated.
I am extremely dismayed that the youth training allowance has not been uprated. I am also dismayed that for the second time in two years it has taken me pretty well two full days to find anybody who knew whether it had been uprated. It does not seem to be the highest point in the attention of the Department for Education and Employment on Budget Day.
Costs are also identified for the Department of Social Security, which has to top up levels from income support. The Department for Education and Employment, which had a comparatively if not absolutely generous settlement, seems to be exporting its costs to the Department of Social Security. I hope that the Department of Social Security was consulted, and I hope that it minds.
The Minister knows that I do not believe in the current system of treating 16 and 17 year-olds, but I can think of better reasons for that system collapsing than simply that the Department for Education and Employment forgot to uprate the youth training allowance. If they continue to forget to uprate the youth training allowance it will very soon collapse. I hope not to have to make that point again in a year's time.
Finally—and I really mean finally—I want to touch on the regulations about asylum seekers. It has always been my rule that I am not prepared to use starvation as an instrument of policy. I am not prepared to use it here.
I want to raise two points. One is the exclusion of claims which are not made at the port of entry. That is like telling a drowning man who scrambles out of the sea on to a piece of land that you happen to own that he should have asked your permission before coming out of the sea and saving himself from drowning. It is not in the real world.
I also want to ask the Minister the precise interpretation of the words he used:

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"When a claimant is found not to be a refugee, benefit will cease".
If that is an accurate use of language, that means that benefit will continue until an appeal is heard and the legal process has been determined. If it means that, I welcome it. If it does not mean that, it is a terminological inexactitude.
5.12 p.m.
Lord Mackay of Ardbrecknish: My Lords, I am conscious of the fact that speakers in the main debate today are limited to nine minutes. Therefore, I apologise to the noble Earl and the noble Baroness if I do not manage to cover all the points they raised, because I at least shall make sure that I do not exceed the nine minutes to which other speakers have to limit their speeches in the main debate.
I shall begin with the last point made by the noble Earl about asylum seekers. I should like to share with the House a few simple statistics which make my point more graphically than anything else I can say. In 1984 2,900 claims were received by the Home Office, and 24 per cent. of those were found to be valid. By 1994 there were 32,800 claims, plus 10,000 accompanying dependants. Only 4 per cent. of those claims were successful. In 1995 there have been 50,000 claims. If the same scoring rate applies as last year, your Lordships can easily see that a significant number of those claims will not be upheld.
I can tell the noble Earl that the position is that in the case of people who ask for refugee status at the port of entry, during the time their applications are being considered by the Home Office they will be eligible for benefit. If they are found not to fulfil the conditions for refugee status social security benefit will cease. That will put them on all fours with people in our country, who equally do not receive social security benefit while they are appealing. It is perfectly clear from any view of those figures that over 70 per cent. of people who come to this country as students, tourists or visitors, sometimes guaranteeing that they will ask for nothing from the British taxpayer, decide when their stay here comes to an end that they want asylum. We have to look seriously at the escalation in those numbers and the large number of people who apply for asylum who are found not to be genuine asylum seekers.
I turn now to the question of housing benefit for people under the age of 25. The noble Baroness asked about periodicity—if I can give it that rather longer name—in other words, housing benefit being paid in arrears. As I mentioned in the Statement, this is a way of countering fraud. People claim housing benefit and when they receive it they do not pass the money on to the landlord but disappear. We believe that one of the ways to stop that and to prevent overpayment, which is often very difficult to recover, is to pay in arrears.
The noble Baroness was anxious that landlords might tell people that if they cannot pay they cannot rent a property. I have made the point that we are going to make it possible for local authorities to pay benefit directly to the landlord. Therefore, a landlord will know
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that if he takes on somebody who is on housing benefit he will be guaranteed the payment at the end of the four weeks directly from the local authority. I hope that that goes some way to meet the anxieties of the noble Baroness.
On the general question of those under 25, most young people under 25 live in the parental home. A fair number—about a third—do not live in the parental home. Many are owner-occupiers, and many live in local authority accommodation. In particular, we are concerned with those who live in the private rented sector. It was suggested to me that I am making young people stay at home. I am not making them stay at home. I am ensuring that if they take accommodation while on benefit they can afford that selfsame accommodation when they find work. The benefit system has not acted as a barrier to their finding work.
As I mentioned in my original Statement, there will be a number of safeguards. Married and unmarried couples, people with the care of children and others who are exempt from the January changes will not be covered by this provision. In addition, local authorities will be given some resources for a hardship discretionary fund which they can use if they think that somebody is suffering hardship and needs help of a discretionary nature.
I turn now to lone parents. Interestingly enough, when one-parent benefit was introduced in 1975 it was introduced on a temporary basis. The noble Baroness, Lady Castle, who was then the Secretary of State, said in May 1975 that the benefit was purely a temporary one. Mr Michael Meacher said that they were making an exception for the reasons that this was an interim benefit. It would only be for one year. It has done rather well to survive all these years, and it ill-becomes the Opposition to start complaining when a benefit that they introduced temporarily for only one year is changed by us after 20 years.
I want to reiterate the point that I made in the Statement. We believe that it is right that children, whether they be in one-parent families or in the traditional two parent families, appear to be treated the same and that we do not appear to favour one group over the other. I believe that what we propose will signal that we neither condemn nor are making it more attractive for people to be single parents as opposed to living in the traditional arrangement of a couple, which almost everyone in this House and the other place believes is the best arrangement for the bringing up of children. I was going to say young children, but that applies to all children. I believe that it is a sensible reform which will remove the distortion regarding the current situation. At the same time it will protect those who already receive benefit. They will not suffer any loss.
The noble Earl asked me once again whether we had consulted with others about costs. At the risk of sounding like the Prime Minister, I refer him to the reply I gave him the other day. I made it perfectly clear that

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when proposals are made by one government department, all government departments are involved in the discussions.
Earl Russell: My Lords, with respect, the Minister is in trouble if he gives the same reply because it was not the same question. I asked what resource implications for other departments were identified.
Lord Mackay of Ardbrecknish: My Lords, I would need notice of that question if it relates to a specific benefit.
So far as I understand, the suggestions and proposals that we have made as regards housing have no read-across costs for other departments because we have taken into account the particularly difficult cases—I could list them—which were excluded from the January housing benefit changes, and any difficulties have been taken into consideration.
The noble Earl also asked me about the discretionary social fund budget. That is usually announced closer to the beginning of the next financial year, which will be in March, for the reason that the size of the budget relates to the performance in receiving back the social fund loans.
If I am to obey the strictures that I imposed on myself, I must now finish. However, what I found interesting about the statement of the noble Baroness is that it seemed to imply one extra expenditure piled on another.
Noble Lords: No, no!
Lord Mackay of Ardbrecknish: My Lords, as I understood the position of the party opposite, it does not want any increase in expenditure, I presume over the £90 billion that we are already spending on social security.
5.22 p.m.
Lord Dubs: My Lords, perhaps I may return to the question of asylum seekers. It was not clear whether the Minister had answered the questions put by the two noble Lords in reply to the Statement.
Will he explain what is to happen to an asylum seeker who does not claim asylum at Heathrow Airport or Dover but claims it some time later? As I understand it, the Minister answered that many of those claims were now being refused. However, that does not deal with whether an asylum seeker who is afraid of being sent into detention, and therefore does not claim asylum immediately but leaves it for some little while, should have any right to income support denied him. It is not just; and it does not make sense.
In the event of the Home Office refusing an asylum seeker, will the Minister explain whether or not the entitlement to income support will apply between that date and the date of an appeal before an adjudicator or an immigration appeal tribunal? It is a simple proposition. Will the Minister please answer?
Lord Mackay of Ardbrecknish: My Lords, the position is quite simply this. Those who enter the UK and apply for refugee status at the port of entry will be eligible for benefits until their position is decided. They
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will not be eligible for benefits during the appeal proceedings because that puts them on all fours with the way in which citizens of the UK are treated—no better and no worse.
As regards people who enter the UK as visitors, tourists or students with the normal immigration clearance—they have limited leave to remain on the understanding that they do not become a burden on public funds—they will no longer be entitled to benefit if they subsequently claim asylum. I hope that that makes the position clear.
Lord Harris of Greenwich: My Lords, perhaps I may ask the noble Lord one question on that. If those people succeed in their appeal, do they receive back payment of benefit?
Lord Mackay of Ardbrecknish: My Lords, if they succeed in their appeal—as do a very small percentage of the considerable numbers that I mentioned—they will be eligible for benefit, I think, from that point. However, I shall check that I am right and write to the noble Lord.

Economic Affairs
Debate resumed.
5.25 p.m.
Lord Ezra: My Lords, I should like to join with the noble Lord, Lord Clark of Kempston, in expressing indebtedness to the noble Lord, Lord Desai, for introducing the Motion even though the economy was exhaustively debated a week ago. However, we can now consider the state of the economy in the light of the Budget. It is rate that we have been able to discuss the Budget so shorty after its presentation. I hope that this can become a precedent.
We need to consider the Budget in the light of the current economic trends. There is undoubtedly a slow-down, as the Chancellor accepted in his Statement yesterday. The question that needs to be asked is whether this i, a pause such as occurred in the mid-1980s or the precursor of a recession such as was experienced in the early 1990s. Let us hope that it is the former.
The facts are these. In the third quarter of 1994 the economy was rowing by 4.3 per cent. In the third quarter of this year, as recently announced, growth has come down to 2.1 per cent. Underlying that figure is the fact that there has been a substantial amount of industrial stock-building, and with the continued weakness in the market de-stocking could begin to take place. That would bear down further on the growth rate. Within the figure of 2.1 per cent. is an exceptional expansion of North Sea oil output. That indicates that the rest of the economy has been doing worse than the figures suggest.
Against that background it is not surprising that tax revenues are noticeably less than expected and that in consequence the public sector borrowing requirement has been higher. The Government had forecast that that

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would amount to £23.5 billion for 1995 but it is likely to be £29 billion, as we learnt from the Chancellor yesterday.
Those are the current circumstances against which the Budget has to be judged. However, there are two longer-term problems. The first is the continued inadequacy of productive investment. The effect of that is that every time there is an upturn in demand, increased imports are required and there is an inflationary risk. The second long-term problem is unemployment. Even though the level in Britain is somewhat less than in a number of other European countries, it is still exceptionally high and represents an enormous drain on resources in the form of unemployment benefit, quite apart from the adverse social effects.
I suggest that in those circumstances, if the Budget were taking place in the political mid-term, the Chancellor could have been expected to be very cautious about tax reductions and to reserve what resources he had at his disposal to stimulate investment and create more job opportunities. The measures taken would need to be sustainable and to avoid any form of overheating.
However, the Budget has not come at mid-term but near the end of term. There have been considerable political pressures. We have to bear that in mind in considering the Budget. In the event there is no doubt that the Chancellor has resisted pressures from within his own party to introduce substantial direct tax reductions. He seems to have accepted that it is a year in which the priorities, while keeping inflation under control, are to stimulate investment and create job opportunities. However, the Chancellor has estimated that growth next year could be of the order of 3 per cent. That considerably exceeds other estimates and is certainly out of line with present trends. It is difficult to see how that could be achieved without a degree of stimulus.
There is little of such stimulus in the Budget. For example, nothing has been done to increase capital allowances as proposed by the CBI; and there is no hint as yet of reducing interest rates. Would it not have been more desirable at this stage to reduce interest rates rather than reduce direct tax? A reduction in interest rates would stimulate the lagging housing and construction market and boost industrial investment generally.
The Government appear to be relying to an increasing extent on the private finance initiative, as was mentioned by the noble Lord, Lord Desai. While this initiative, which we from these Benches fully support, was originally introduced as a means of adding to the level of public investment, it now seems to be intended to replace public investment. If that is the case, we ought to have a clear statement from the Government to that effect. The level of PFI investment so far has been below government estimates. Is there, therefore, not a risk that the overall level of public investment, including PFI projects, could fall at the very time when we need more capital formation in both the public and the private sectors?
There is a specific area of expenditure reduction to which I should like to refer. For many years I have been involved with NEA which operates the Home
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Energy Efficiency Scheme. The reduction in the amount of funding of this scheme announced by the Department of the Environment in the context of the Budget yesterday is very disturbing. The total sum involved is £100 million, which was included in the Finance Bill last year. It was stated to be a funding which would last for three years. It has now been reduced by 30 per cent. Some 600,000 homes a year, inhabited by people on low incomes, particularly the elderly, are insulated as a result of the scheme. It is therefore creating much social benefit and reducing pollution from excessive use of energy. It is wholly desirable on those two counts. It is sad that, having decided on such an imaginative measure less than a year ago, the Government should now be going back on it.
I wish to conclude my views on the Budget by stating that I regret that more has not been done to deal with the long-term economic problems that we face; namely, the need for increased productive investment and job opportunities. While the Budget has been cautious, as befits present circumstances, it has not, in my opinion, sufficiently addressed those pressing priorities.
5.32 p.m.
Lord Monson: My Lords, I too am grateful to the noble Lord, Lord Desai, for giving us the chance to debate the Budget Statement—the first time ever, to my recollection. I congratulate him on his ingenuity in finding a formula whereby that can be done. I am not qualified to follow him in his economic analysis and will therefore concentrate on the Budget Statement.
There are things to applaud in the Budget: for example, the concessions on business rates, especially the concessions for small businesses; and the refusal to give more tax breaks to owner occupiers. We all know that the current flat housing market is not caused by lack of tax incentives but by job uncertainties. Once the present wave of "down-sizing", "delayering" and other ugly verbs has subsided, the market is sure to recover, given that house prices in real terms are the lowest for many years.
On a personal note, as the proud owner of a very modest classic car in which I never travel more than 250 miles a year, I am naturally delighted at the exemption from road fund tax, since I calculated that last year I paid more than 60p in road fund tax alone for every mile covered.
However, there are also things to deplore in the Budget. The cut in road building, particularly the building of bypasses round towns where pedestrians risk their lives every day of the year, is bound to lead to more costly and often fatal accidents, as well as adding to the costs of manufacturers, distributors and retailers. I also deplore the fact that the tyranny of the health fanatics has led to the poor smoker being clobbered yet again. I use "poor" in both senses of the word. The well-to-do smokers will not suffer much, but poor pensioners for whom tobacco is perhaps their only source of comfort will suffer. I declare an interest as a patron of FOREST, but not in my personal capacity. As

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a light smoker I find I can acquire enough duty-free cigarettes on my trips abroad to cover all my yearly needs.
I am uneasy at the reduction in the standard rate. Would not a further extension of the 20 pence rate have been preferable? "A penny off tax" sounds dreadfully old-fashioned and patronising, but I suppose that for all Chancellors, whatever their political affiliation, hitting the headlines is a political necessity. That is why no government, I fear, will ever dare to amalgamate income tax and national insurance, as we all know ought to be done—given that national insurance is bogus; it is not a genuine insurance premium at all. The amalgamation cannot be done because it would look terrible in the headlines, which would shriek: "Basic rate raised to 34 per cent." or whatever.
Finance Bills are almost always amended fairly extensively in Committee, so I should like tentatively to put forward some suggestions to honourable Members and right honourable Members in another place. First, as regards beer duty, I do not believe that one can complain about the level of duty on the stronger beers and lagers. But the duty on low-strength beers is too high, particularly in relation to that prevailing on the Continent. A reduction in duty on lower strength beers, by helping to alter the drinking habits of young people, would pay for itself. There would be less smuggling and less criminal damage to people and property resulting from drunken hooliganism and vandalism.
Secondly, the Conservatives claim to be the party of the family. They claim, for example, to prefer men and women of the same generation living together to be married rather than unmarried, other things being equal. How strange, then, that the tax concession on gifts made in consideration of marriage has never been raised in the 27 years since it was first fixed at £5,000. It would now need to be more than quadrupled, in order to regain its former value. Even if circumstances make it impossible to do so this year, could it not at least be doubled for the time being?
Finally, capital gains tax: by leaving the rates unaltered, the Chancellor is missing a magnificent opportunity to raise more revenue—paradoxical though that may sound. Now that the dice have been loaded against the taxpayer by the withdrawal last year of indexation relief on capital losses, individuals like myself are not—on principle—going to realise gains taxable at 40 per cent. other than in emergencies. Short-term gains—by which I mean gains on assets held for less than a year or perhaps two years—should continue to be taxed as income. But if the rates on longer term gains were reduced from the proposed range of 24 per cent. to 40 per cent. to, let us say, 16 per cent. to 27 per cent.—a reduction of about one-third—one could guarantee that there would be massive realisations and an enormous increase in turnover, resulting in a greatly increased take for the Exchequer—particularly with the prospect of a government of a different political persuasion looming on the horizon. This would be one of those rare occasions when both the taxpayer and the Exchequer stand to gain. I urge the Chancellor to consider this very carefully over the next few weeks.
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Finally, I turn to stamp duty. Ad valorem stamp duty, as opposed to the fussy 50p stamp duty, fulfils all the criteria for a good tax, if any tax can be considered good, in so far as it is almost impossible to avoid; the rate is low, thereby avoiding both hardship and the distortion of prices; and above all, it is extremely cheap to collect. However, it should surely be levied on the seller rather than the buyer, sellers normally being better off. This would enormously help first-time home buyers. Obviously it is too major a step to be taken this year, but I urge the Chancellor to consider this measure for the 1996 Budget.
5.40 p.m.
Lord Eatwell: My Lords, what we all looked for yesterday was a Budget that addresses the needs of the country. First and foremost this country needs, as the noble Lord, Lord Ezra, said, more high quality investment. Today, three years into the recovery, the level of business investment is only 4 per cent. higher than it was in the trough of the recession. We are informed in the Red Book that business investment will increase by only a further miserable 3.25 per cent. in 1995. Manufacturing investment is still, despite recent increases, 18 per cent. below the previous peak reached in 1989.
At the same stage of recovery from the Tory recession of 1981, investment was 28 per cent. higher than in the trough. Without investment we cannot prosper. Without new capacity we can neither compete nor create sustainable jobs. Without competitive investment we are horribly vulnerable to inflationary pressures whenever the economy grows at anything like a decent rate.
Yet despite the importance of investment to our economic future, the Budget does nothing for private investment. There are some business rate and corporation tax benefits for small firms; but these are offset by the failure to uprate the threshold for VAT registration in line with inflation, and by the bizarre proposal to alter the rules on capital gains to encourage our most successful small entrepreneurs to sell up and retire at 50, when they are in their prime.
For the large firms which undertake the bulk of Britain's investment, there is nothing. No wonder British business has no confidence in this Conservative Government. Why should it, when the Government cut investment in Britain's future? The road programme is cut by 15 per cent., piling congestion costs on industry. Hospital building and repairs are cut by 18 per cent., piling misery on the National Health Service. Housing is cut, piling more people on to the streets and prolonging the misery of the construction industry. And while the public infrastructure crumbles around us, Table 6.4 of the Red Book shows that public sector capital expenditure is projected to fall in real terms year after year into the future, even when the private finance initiative is included in the figures.
As noble Lords will probably know, the idea of the private finance initiative was invented back in 1991 by my honourable friend John Prescott, when he was Shadow Minister for Transport. Little could he have

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realised that, in the hands of the Tory Party, the PFI would become in conception an exquisite illusion and in practice an administrative shambles.
Yesterday, Mr. Clarke relaunched the PFI, again, just as Tory Chancellors have relaunched it every year since 1992. The reality shown in Table 6.4 is that PFI-funded investment is running at a tenth of every projected figure. The PFI, as my noble friend Lord Desai suggested, is a fig leaf for cuts in government investment. The PFI is a dangerous illusion—PFI: probably fictitious investment.
Labour has put forward detailed proposals to make the PFI work effectively in the national interest. More generally, we have proposed a temporary increase in capital allowances to boost investment, together with measures to solve the key problem of long-term financing for small business and to encourage investment in the regions. And we have proposed a fundamental review of corporation tax and capital gains tax to encourage and reward long-term investment.
The Chancellor has not merely ignored those proposals. He has done something far more dangerous. He has pretended that the problem of low investment does not exist at all.
The second great need in Britain's economy today is a concerted attack on the growing inequality and outright poverty that defaces our country. Earlier this year, most Members of this House were shocked by the facts revealed in the Rowntree Inquiry into Income and Wealth. I say most Members, for we were treated to the distasteful spectacle of the noble Lord, Lord Mackay of Ardbrecknish, attempting to explain away the findings of the inquiry. Indeed, the Government put more effort into explaining away the facts of poverty than they have ever done into alleviating poverty.
Noble Lords will remember that the inquiry used government figures to show that around a fifth of our fellow citizens have enjoyed no increase at all in real income since 1979; that one in three children in this country are growing up in poverty (many of whom will be even more impoverished by the Government's shameful attack on the children of lone parents); and that one in five households now have no member working, compared with one in 12 in 1979.
The detailed analysis of the Budget by the Institute of Fiscal Studies, published in the Financial Times this morning, shows that once again the real incomes of the poorest 20 per cent. in Britain are to be cut by this Budget. That is the Tory way: take from the most vulnerable. I must ask the Minister: when are you going to pick on someone your own size for a change? Why are you always picking on the poorest and the weakest?
To attack poverty it is vital to get people off welfare and back into work. The Chancellor's uprating of personal allowances and his extension of the 20p band are therefore welcome; but it is still the case that most poor people taking up work will face a marginal tax rate, when loss of benefits is taken into account, of over 90 per cent.
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Instead of adopting Labour's proposal for a 10p tax band to loosen the poverty trap, together with a concerted kick-start programme to get young people back into work, the Chancellor has cut housing benefit for young people. In an era in which flexibility and mobility are key elements in the efficient working of the labour market, this foolish Chancellor has encouraged the young unemployed to stay at home rather than going to look for work, thus reducing the likelihood that they will find work, and increasing the potential welfare burden. The noble Lord, Lord Mackay, demonstrated in his comments on the uprating statement that he just does not understand the mechanics of the poverty trap.
Indeed, there is little encouragement in this Budget for any of the unemployed. The cut in employers' national insurance contributions, which might help a little, is postponed to April 1997. Community Action, which helps people with learning difficulties into work, is to be abolished—attacking the vulnerable again.
There are no innovative schemes. Labour's idea of transferring benefits to employers to take on the long-term unemployed has but a pale echo in the reduction of employers' national insurance contributions. But the Red Book's projected slow-down in the overall growth of the economy also bodes ill for the labour market. And it bodes ill for the PSBR. Government borrowing is up—it was up £6.7 billion in 1995–96; there will be £8.5 billion more borrowing in 1996–97; and £10 billion more in 1997–98. We are talking serious money now. What could be more profligate than borrowing for tax cuts?
That increase in borrowing is a clear measure of economic failure—the failure to build an economy strong enough to sustain high non-inflationary levels of growth and employment, which would in turn result in healthy public finances.
And it is that failure to build a strong economy that also lies behind the relentless rise in taxation under this Government: 35.75 per cent. next year; up another half a per cent. the year after that; and another half a per cent. the year after that; and another half a per cent. the year after that, until we reach 37.25 per cent. of GDP in the year 2000. Upward and ever upward soars the Tory tax bill.
Of course, everyone knows that the Conservatives want to cut taxes. They are just not capable of doing it. And they are not capable of doing it because of the weakness of the real economy that their policies have produced.
To build that strong economy Labour has put forward detailed proposals for encouraging investment in new capacity and investment in the skills of the British people, loosening the short-termist tourniquet on the investment life-blood of our future. Labour has also put forward detailed proposals to reform the conduct of monetary policy, to aid the maintenance of macro-economic stability and low inflation. But the only guarantee of low inflation and macro-economic stability is a strong economy. That is the circle into which we have to break. High levels of investment are necessary to be competitive, to cut employment, to build a strong public sector, to secure the public finances and to fund sustainable cuts in taxation.

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Nothing in yesterday's Budget suggests that this tired government have the faintest idea how to achieve those goals. Mr. Clarke was going through the motions without either enthusiasm or conviction. The Budget confirms, if confirmation were needed, that the sooner this decrepit government go and make way for a new Labour Government, the better for the wellbeing and prosperity of British business and the British people.
5.51 p.m.
Lord Boardman: My Lords, I hope that the noble Lord will forgive me if I do not follow him in the arguments that he put forward about the social services, but a time limit of nine minutes does not permit me to do so. However, I know that those arguments will be fully answered from this side on a future occasion.
Perhaps I may take up one point that the noble Lord made. He prayed in aid of his case the Institute of Fiscal Studies. Perhaps I may remind the noble Lord that that was the body which said that the proposed introduction by the shadow Chancellor, Mr. Gordon Brown, of a 10p tax band was a gimmick and that appearance seemed to matter more than truth. That is perhaps a side issue in the debate this afternoon.
I thank, as other noble Lords have done, the noble Lord, Lord Desai, for opening the debate. He has given us an opportunity that we have not had before to talk about the Budget. He is a very brave man for clearly he called this debate in anticipation of a Budget that he could attack. Indeed, he described in an article in the New Statesman at about the time that he must have decided to table this debate—an article entitled "No time for bribes"—what he confidently expected would be the Budget produced yesterday by the Chancellor. Obviously, he has been disappointed. It has not been such a Budget. Those of us on this side of the House did not expect that it would be. The press seemed to anticipate such a Budget but they, too, have had to retract. As the noble Lord said in opening, it might have been worse. That was the highest praise that he gave to it, although there were a number of elements in the Budget which he had hoped for but predicted would not be in it, such as publicly paid care. The concession made by the Chancellor was one for which the noble Lord had hoped though he had wanted it to be rather more generous than it was. It would have been nice had the noble Lord given some credit to the Chancellor for doing many of the things that the noble Lord feared he would not do. But so be it.
Much of the noble Lord's speech will prove a delight for economists. Perhaps he will forgive me if I do not devote my time and limited ability to trying to match it. I hope that others will do so. But in speaking of the Budget, he might have said something about the economy which supports it—the state of the economy which is the basis on which Budgets are built. He will have to concede—although he did not do so this evening—that the state of the economy is extremely good. My noble friend Lord Clark referred to it in his speech earlier. It includes factors such as low inflation, unemployment falling by 10,000 a month, exports per head, manufacturing output, faster growth and investment.
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With regard to investment perhaps I may take up the point made by the noble Lord, Lord Eatwell, who was critical of the investment that we made in this country. But 40 per cent. of the investment in Europe from America and Japan comes to this country. That is a sign of confidence. Those who could choose any country in Europe have chosen this country. It is a sign of the confidence that they rightly have in this country.
Strikes over the past two years in this country have been lower than at any other time since records have been kept, which I believe is 1891. I cannot think of any other period in my political lifetime when this country has had a better economic future to look forward to or been economically stronger. At no other time in history has that been the case. Of course, many things can be and will be improved. But if any noble Lord can suggest a time when a government of the other side produced a stronger economy than this one, I shall happily give way to him.
Lord Eatwell: My Lords, I shall be delighted to answer the noble Lord. Is it not clear that the levels of unemployment were significantly lower, inflation was lower and growth was higher from 1964 to 1970?
Lord Boardman: My Lords, I shall be happy to challenge the noble Lord on all those points. But nobody has produced a state of the economy which is stronger, better and more strike-free than it is now. The noble Lord selected one or two points on which I should love to take issue with him, but the clock does not permit me to do so.
I suggest that the Budget was built on very sound foundations. It was not, as the noble Lord, Lord Desai, hoped that it might be, built on anticipating bribes to the electorate. It was described by the Chancellor of the Exchequer as concentrating on four fields: people will keep more of what they earn and save; more will be spent on schools, national health and police; public spending will be kept under firm control; and public borrowing will be kept on the downward path. Those are the themes that he put forward. I believe that most noble Lords in this House would strongly support them. The noble Lord, Lord Desai, said that they were issues that he supported.
The tax concessions contained in the Budget were more than covered by cuts in public expenditure. Again, that is a proper aim, consistent with the themes to which I referred.
I shall not speak further about the Budget, which was all clearly set out in the Chancellor's speech and is in the Red Book. Perhaps I may say just a few words about the Red Book and the way in which the Treasury produced its Budget statistics. Within a few minutes of the Chancellor sitting down in the Chamber, the Red Book and the press briefings were available in the Printed Paper Office. They are packed with matters which were of the highest secrecy and needed the highest security. We owe a great debt to all those who were concerned in putting together the Budget documents in the Treasury and for the way in which they managed to keep security. It is not general in most

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departments of life today. However, in the Budget itself, there is much that we could debate and much to praise but I do not have the time to do so.
Perhaps I may spend a moment or two speculating on the kinds of provisions that we might have expected in a Labour Budget. Mr. Blair constantly says that his government would not be one that would tax and spend. His colleagues do not seem to be convinced; nor indeed do they intend to comply. They have made it quite clear. There was a statement a few days ago on Radio 4 by one of his colleagues, in which it was said that Gordon Brown can say anything that he likes if he thinks that it will win the election, but when Labour is in power it will be looking for other priorities apart from tax cuts. That shows how much reliance we can place upon statements which come from the other side about their proposals for a Budget.
Labour has failed to say where it stands on a whole range of key subjects: inflation, interest rates and public spending. We know that it has committed itself to a number of other matters such as the minimum wage, the Social Chapter, payroll tax and regional development agencies—a kind of glorified national enterprise board. We know where it stands on those issues. Those who took the trouble to read A New Economic Future for Britain in June of this year, no doubt read it and shuddered at it as I did. We know what Mr. Brown's windfall tax is intended to cover and the 11 different massive expenditures it is to meet. But today we have a sound developing economy; we have a sound Budget to deliver a sustained recovery and to take it forward. We are extremely fortunate.
6 p.m.
Lord Shepherd: My Lords, I suspect the noble Lord, Lord Boardman, may be guilty of some complacency in the way in which he described the present economy. And the noble Lord, Lord Clark, was beginning to enjoy himself in regard to the situation in which the Conservatives found themselves in 1979, but he forgot one factor. I refer to the grave financial situation with which we were faced on the day we took office in 1964.
In the days when I first came to this House, some 40 years ago, it was the practice that, if one spoke after 5.30, one apologised for speaking "at this late hour". I shall therefore put aside what I had intended to say and, as my Quaker friends say, I shall speak as the spirit moves me and hope to keep within my time.
I fully support what was said by my noble friend Lord Eatwell in terms of the need to recreate and rejuvenate our manufacturing base. That is essential if we are to create the prosperity which our people expect. We must do that, though in a sense it will be like climbing Mount Everest. We need a programme that is broadly acceptable and that will last at least three parliamentary terms.
There is an acceptance and belief that because we are within the European Community we can trade comfortably within the tariff borders of the Community. I suspect that in time, with the enlargement of the Community and the development of the countries within
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the Asian basin plus the United States, great pressures—political and otherwise—will be brought to bear for the reduction of the tariff borders that surround the Community. If that happens—I suspect it will happen within one generation—it will be essential for this country, if we are not able to compete within the Community, to be able to compete throughout the world, particularly within the Asian basin.
We spoke of the prosperity league. I believe we are 18th on the list. I was not impressed with most of those at the top, but was conscious of two—Hong Kong and Singapore. I visited Singapore and Hong Kong in 1946. They were basically entrepôt ports. They had no industry or natural resources. Hong Kong had a population of 500,000 people. I remember water being rationed to two hours a day. Singapore had plenty of water because it had storage from Malaysia, but it had no industrial base. Today, both are major exporters. Their prosperity per head of the population is of the highest and is now above ours.
We should take all that into account in regard to what can be and will be achieved in the Asian basin, which we may have to confront, if we are not already confronting it. I sincerely believe that we must rejuvenate and expand our economic and manufacturing base. The noble Lord, Lord Boardman, said that we are doing well. But that depends from where one starts. We must recover what was once the manufacturing and economic base of this country. We are a long way from it today. I hope that the knowledge in regard to the potential competition that this country and other European countries may face is borne in mind.
In regard to the Budget, my understanding is that its object was limited. It was to make the economy more manageable and give it greater flexibility; it was to provide incentives for those who work in industry and trade; and it was to create new opportunities and protection for those who are retired or who have savings. That concept of the objects of the Budget is its basic weakness and sooner or later we shall need to find a new formula which gives us a longer term plan—I hesitate to use the term "national plan"—which will command the acceptance of all political parties.
I must say to my noble friends that I found yesterday's Budget extremely clever. It gave a little here and a little there. In terms of inheritance tax the move to £200,000 was about right. Why should the ordinary man be taxed twice? First, he is taxed on his earnings and, secondly, he is taxed on his savings. The reduction of the tax on savings is to be welcomed. Also, I support the concept that the workforce should be encouraged to buy shares within their companies, provided adequate safeguards exist.
I support all those elements of the Budget. But I turn to the 1 per cent. I do not support plebiscites, but if we had a plebiscite and put to the ordinary people of this country, "Will you accept a reduction of 1p in the pound on your tax or would you like that sum to be hypothecated, in addition to what is already paid by the state, to hospitals and schools?" most of us would be surprised at the response. I believe the ordinary man

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would say that he attaches supreme importance to the quality of our medical service and schooling and that he may well forego what is, after all, a minute saving.
My anxiety concerns the forecasts. My noble friend Lord Diamond sits behind me. But I believe forecasts to be extremely dubious. They may be based on specific facts, but they are highly vulnerable, particularly at this moment in time. For instance, if the PSBR is to be reduced, it will require a major change. The Government know from their recent experience that what is forecast for the PSBR now is much higher than what was forecast 12 months ago. I understand that forecasts have to be made, but the danger lies in getting them wrong, particularly when one bears in mind the risks to ourselves and our currency and one takes into account the speed at which currencies fluctuate and the fact that that fluctuation is difficult to stop once it starts.
The Chancellor is to be congratulated on producing a prudent Budget and—I say this to the noble Lord, Lord Boardman—for his courage in withstanding the enormous pressures placed upon him for solely political reasons.
6.10 p.m.
Lord Skidelsky: My Lords, I very much regret that a prior engagement will stop me from being present for the whole of the debate. I am very sorry about that. I was delighted to hear the speech of the noble Lord, Lord Desai, and I congratulate him on his success in securing us the occasion to discuss the Budget Statement. The speeches so far fully justify that innovation and I hope that it will become permanent.
One of the noble Lord's most endearing qualities is his intellectual honesty, which I know has been a source of some embarrassment to his Front Bench in the past. He was honest enough to say this afternoon that he favours a high tax economy. How he squares that with his penetrating analysis of the dynamics of the global economy I am not quite sure, but at least he favours a high tax economy. I hope that I am honest enough to say that I favour a low tax economy. That is the nub of the difference between us, and I venture to suggest that it is the nub of the difference between the Opposition side of the House and our side of the House.
I wish I could persuade the noble Lord, Lord Bruce of Donington, that in taking up that position I am not betraying John Maynard Keynes. I believe that the only way you can get the Government's budget to work in favour of stabilisation is on the basis of sound public finances and the only way to make them sound is by cutting public spending; otherwise you face a continuing borrowing problem which turns the markets against you and prevents governments from doing even the necessary things that governments should do. But that is another debate for another occasion.
I welcome this week's Budget as, above all, a responsible Budget. The Chancellor has resisted the temptation to go electioneering. Modest tax cuts are balanced by modest spending cuts. That is the only strategy consistent with getting our interest rates down, which is the only basis of the boost to the economy which the noble Lord, Lord Desai, and all of us want.
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The noble Lord, Lord Eatwell, said that the Budget has done nothing for investment. But if it is a Budget that enables interest rates to come down, then it will have done an enormous amount for investment. It is a very old-fashioned view that the only way you can get more investment is by increasing government spending on capital projects; the way you get more investment is by running your public finances in a way that enables you to have low interest rates. If you have low interest rates, you get durable recovery and an upsurge in growth.
I welcome this Budget as a further confirmation that we have renounced the bad old days of stop-go, the days when government deliberately created political business cycles in order to get re-elected—all go before the election, all stop after the election. We have turned that corner and I do not think that any Chancellor will do that in the future. I am glad that the Chancellor has rejected the advice of some Tory pessimists to leave the public finances in a mess for an incoming Labour Government. I read that proposition in a couple of articles by Conservative journalists. The Chancellor has rejected it.
This Chancellor and all of us on these Benches want and expect the Government to win the next election and inherit a strong fiscal position as a basis for their further reforms. You could say that the Chancellor has learnt from the whole experience of the post-war period that short-term highs are not worth the long-term lows and anyway no longer fool the public. Modesty is forced on governments nowadays as it is very hard for them to make people pay more taxes than they actually want to pay. That is the practical problem with the vision of the noble Lord, Lord Desai, of a high tax economy.
People have shown that they do not want a high tax economy and they do not vote for parties which promise to put up taxes. It is increasingly easy for people to arrange their affairs so that they avoid paying tax, whatever they may say in the plebiscite suggested by the noble Lord, Lord Shepherd. For example, it is estimated that the Government lost £100 million in alcohol duty revenue last year from people buying their drink abroad. These schemes are becoming increasingly possible. This lack of revenue buoyancy, incidentally, is reflected in the interesting resort to pre-modern methods of taxation like the national lottery. Nor can governments borrow any longer to their heart's desire from savers who have been fleeced too often in the past.
I especially welcome the Chancellor's help for long-term care and his tax encouragement for savings and employee share ownership. I am very pleased—here I must declare an interest as chairman of the Hands Off Reading campaign—that the Chancellor has maintained zero rating of VAT on the printed word. We now look to the Government to maintain that position in Brussels against the continual pressure to harmonise VAT rates across the Community.
All that seems to me admirable. My doubts about the Budget chiefly relate to its spending side. Some of the spending cuts look a little cosmetic to me. This year £500 million has come off the contingency fund. The noble Lord, Lord Desai, has implied that the tax cuts are

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being paid for by a run-down in the reserves. I do not read the figures that way because according to page 131 of the Red Book falls in the reserves will be balanced by expected receipts. I do not know what the answer to that is. Perhaps my noble friend the Minister will elucidate this technical conundrum when he winds up.
There are also cuts of £1.5 billion in capital spending programmes. Those are supposed to be made up by the private sector through the private finance initiative. I tend to agree that these are likely to be spending cuts postponed rather than cut. It is difficult for hospital trusts to borrow on the strength of assets for which they are not allowed to charge and on the collateral of one year's guaranteed income alone. I wonder how successful the private finance initiative will actually be in raising capital investment.
My real question, and the one on which I want to end, is whether there is any real strategy underlying the Chancellor's prudent housekeeping. What is the Government's medium-term fiscal aim? Is it to balance the budget over the cycle? Is it to balance the budget by 1998? Is it to bring the PSBR into balance? Those are all phrases which have been on ministerial lips in recent weeks. I am none the wiser. All I know is that the PSBR is obstinately stuck at about £30 billion. That is too high and the date for its reduction seems to be put back year after year and, even now, depends on rather optimistic sets of judgments and assumptions both on the revenue side and on the side of economic growth. I am not quite clear what the medium-term strategy is.
Let us be clear. We on this side want to reduce taxes. Everyone is committed to that. But I do not see a clear strategy yet for reducing the burden of taxation. In fact, I see from the Red Book that government receipts are expected to be higher as a proportion of national income in the year 2000 than they are at the moment and that the tax burden is expected to be 4 or 5 per cent. higher than it was in 1990. It is true that by then spending is expected to be below 40 per cent. It may be, on good assumptions, that we shall get a rough balance between taxes and spending at about 40 per cent. of GDP by the end of the century. That is better than nothing, but it is hardly dramatic. Both William Waldegrave and Chris Patten have recently called for a public spending share well below 40 per cent. I missed that commitment in the Budget strategy. As yet there is no real commitment, yet I believe that that is the only plausible basis for long-term Conservative economic policy.
The trouble is that we shall not get those cuts unless we reduce the agenda of the state. A debate on a Budget is neither the time nor the place to start that deep discussion, but I have no doubt that we shall have to have it, and we have to win it. What is the welfare role of government in a privately wealthy economy? What goods should the state provide and what goods should the private sector provide? We have to start that debate from first principles. I hope that a coherent vision of where we want to get to and how we intend to get there will inform the Budget strategy of the next phase of Conservative Government. After all, we have seven years in which to work it out.
6.21 p.m.
Lord Merlyn-Rees: My Lords, the noble Lord, Lord Skidelsky, is always thought-provoking even though in his last words he was romancing. He referred to the fact that some Conservative journalists said that it would be a good idea to leave a mess for a Labour Government to clear up. The noble Lord should look at 1964 because it has happened before. As regards his view on the link between interest rates and investment, when I was a boy in the 1930s interest rates were at rock bottom, but there was no investment. The link between the two is not as easy as classical economists think.
Lord Skidelsky: My Lords, I do not want to go on any longer. The noble Lord will know that there was a big housing boom in the 1930s, which was driven by very low interest rates.
Lord Merlyn-Rees: My Lords, the noble Lord will also remember that that picked up at the end of the slump in 1931, 1932 and 1933. It occurred again in 1938 and was driven by the trade cycle and not by a link between investment and low interest rates because they had been low before. I said that the noble Lord is always thought-provoking, but he must not allow me to think too much or I shall go over my time.
I shall not refer to the Budget because everyone else has done so. I shall refer to the state of the nation. I am very sceptical about Chancellors who believe that there is vote catching in Budgets. If they do catch votes, then within a few months of getting back into office something has to be done about retrieving the situation. That has happened on two or three occasions in the past 20 years. In any event, the reasons for winning elections are manifold. I do not believe the idea that one can buy the electorate is true, whatever party is in power.
As regards the state of the nation, I want to devote my time to employment, as I usually do, or unemployment, which is the other side of the medal. There has not been much talk about employment; it is no longer the "in" word that it was after the war. Indeed, in my young days there was heavy structural unemployment and nobody bothered very much. It took the war to make people see the iniquities of unemployment when people were brought together in the Armed Forces.
People in work at the moment are not very worried about those who are unemployed. I have a vested interest in unemployment as a result of my past and because for 30 years I represented an area where there was heavy unemployment. I shall come to the particular in a moment. As regards the state of the nation, a typical family pays more tax now than it did in 1979. Indirect taxation cannot be removed from the equation. It affects the lower income groups far more than the likes of most of us in this Chamber. Indirect taxation is regressive. There has been low growth in this country despite the figures over a short period. They are lower than the figures I have here for the other countries of the Group of Seven. We wasted North Sea oil. We invest less than our competitors and that is a matter that we should think about.

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In my native Wales, which I see more of now, there is enthusiasm for working for a Japanese firm. Japanese firms invest. They are in manufacturing and they do it better than most British firms. We have to ask ourselves why. The reasons stem from the nature of the way in which the Japanese raise capital and invest. The Japanese firms are in manufacturing and they go to areas such as the north-east coast. Our manufacturing base has disappeared: is that a good thing? We used to be the workshop of the world, but we are not now. The Japanese are very good at manufacturing, mainly as regards the motor car industry.
I turn to the trade balance. Even with a 25 per cent. devaluation of the pound, compared with the rate when John Major took us into the ERM, we still had a deficit in 1994 of £10.5 billion. The recovery and boom in exports is in spite of and not because of government policy. Is that not marvellous when one thinks of all the troubles and tribulations that we went through with devaluation! The pound has devalued by 25 per cent. Let us imagine what the situation would have been if we were on fixed exchange rates through the IMF. Devaluation is the order of the day.
I come now to employment. The figures I have for October show that the seasonally adjusted claimants for unemployment stood at 2.2 million, which is equivalent to one in 12. For men the figure is 10 per cent., which is much higher, and for women it is 4.4 per cent. We ought to direct our minds to the doubts about the way the employment figures are collected. There are many people and economists who believe that they do not give a true picture. We should look at that, particularly in this House. In 1995 unemployment fell by 331,000, but it is still far higher than it was in 1979. Since that year the fraction of the unemployed out of work for more than a year increased by 50 per cent. to just over 1 million. There is an increasing mismatch between the skills of the unemployed and of those needed in industry.
I suggest to your Lordships that we should look at unemployment. It is falling, but the current situation remains bleak for millions of jobless people. One million people have been unemployed for more than one year and half-a-million have been unemployed for more than two years. One in three people without any 0-levels are now out of work and unemployment rates are much higher for young people and members of ethnic minorities. The underlying state of the labour market for women, the poorly educated, low-paid and young people, is getting worse; with poverty increasingly concentrated among the low-paid and households with no work. One in five households have no working adult member. That figure is up from one in 15 in 1975. The gap between higher and lower paid workers is greater than it has been since records began. Economic generation creates part-time jobs. It may be that such jobs are good, but they are not good for me—someone who was brought up on the basis that the man of the house worked a 40, 45 or 50-hour week. In the constituency I represented that does not apply.
I do not live under those circumstances and neither do my children, but many of us who were Labour MPs saw that on a daily and weekly basis. Unemployment is
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in my political blood and we should direct our minds to it. I fished out some figures from the Library, but they are not quite for the area that I represented because there has been a redistribution. In my area 60 per cent. of the population are of working age and of that number 16.5 per cent. are unemployed. In other parts the figure is between 25 and 30 per cent. There is nothing that the Government can do—I am trying to be non-political now—that will alter that fact. The idea that when the economy lifts they will be brought into work is not true. The unemployment situation varies from one part of the country to another. They are good people.
I have said in the House before that when I was in Northern Ireland I met the children of my constituency as soldiers in Northern Ireland. Nowadays the Army is so small, I regret to say, that that does not apply to the same degree as before. I was speaking about Leeds Central. There is unemployment at 8.8 per cent. in Leeds North East, which is a Conservative seat. The way in which people vote is determined not by whether they are caught by the Chancellor, but by the unemployment situation in the area by nature of social class. Those of us who have been absorbed in politics over the years know that to be so. I do not believe that the normal upturn will do very much for us.
The work of the Commission on Social Justice was published not long ago. We have to change our outlook. Our modern war on poverty must tackle the fundamental causes of inequality. High and persistent unemployment leaves people without income and with low and inadequate skills.
I have been putting my mind to this issue and the one thing that I should like to draw to the attention of the House is an article in The Political Quarterly by Professor Dore of LSE and MIT in which he states:
"the form of unemployment that we have in Europe today is … different from … the 1930s … there is only limited possibility of making a dent in the unemployment figures by macroeconomic demand management … there are equally limited possibilities of making much more impact on the employment intensity".
He referred also to the driving force of change on the Pacific Rim and to the changes in that part of the world. It is a gloomy prognosis. He has said, "People do not like me saying this" but is it true? Are we wasting our time with the modern analysis of unemployment in which we have been schooled?
There is something fundamentally wrong in this country. In my view, whatever party is in government some people in the kind of area that I represented will be unemployed. Whatever happens to the rate of interest, whatever happens in the banking system, there will be marginal changes, but more fundamental changes need to be made. At the moment, the important department of state in this country is the Department of Social Security and the reason is that we are paying out money because our system does not work and we have to keep people off the breadline.
6.31 p.m.
Baroness O'Cathain: My Lords, I too thank the noble Lord, Lord Desai, for tabling this Motion. The economic state of the nation is good. It is not the

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greatest in the world, but it is considerably better than many of us had dared to hope, having been subjected to the endless drip-drip of negative comment emanating from both noble Lords opposite and the media.
With this Budget, I get the strong feeling that all is under control. That is most comforting. It really is a case of "steady as she goes". The temptation to tinker endlessly has been rejected. Naturally, there will be disappointment that some of the more absurd predictions which littered our newspapers in the days before the Budget have not materialised. On a personal level, there is one omission, on which I had placed some hope, but more of that anon.
As an aside, the noble Lord, Lord Desai, told us that the Budget had been given a lukewarm reception by the Tory Back Benches and a hostile reception everywhere else. When I heard that, I went straight to the Library, thinking that my croaking voice had also affected my brain and vision and that I had misread something in today's Financial Times, but when I looked at the comments from businessmen, they were all supportive. Perhaps the noble Lord does not think that the opinions of businessmen matter.
The management of an economy which has a turnover of nearly £800 billion is no small task. The enormous figures sometimes cloud the brain. We have heard about massive government expenditure and massive government debt, but in simple terms, the total government expenditure of £306 billion is well within the convergence criterion for joining EMU and, similarly, the plans are that the deficit meets the other convergence criterion of 3 per cent. long before EMU takes effect. Not that I am for one moment suggesting that we should positively aspire to EMU membership; I merely wanted to make the point that, whereas one is often led to believe that we are the poor man of Europe, a second-class citizen in EU economic management terms, the reality is that we are strong and healthy. As an aside, the IMF expects us to be at the top of the G7 growth league, along with Germany, next year. Does that indicate economic weakness?
We frequently hear of our declining position in the "wealth table" of the world. Indeed, the noble Lord, Lord Shepherd, referred to that earlier. We are 16th in terms of GDP per capita, but some of the countries that have overtaken us are the low tax, deregulated economies, particularly Hong Kong and Singapore. If we aspire to move up the league table, we must also adopt an even lower tax and deregulation strategy. I wonder whether the Opposition would go along with that. I have yet to discern a great move on those Benches for lower taxes and further deregulation.
But let us not be bemused by statistics. We should get behind some of the numbers; for example, four of the countries ahead of us in that wealth league table (Belgium, France, Germany and the Netherlands) have lower graduation rates. Do we want to reduce our graduation rates from their current level of 25 per cent.? We have the strategy to improve education standards and to increase the proportion of the population which will benefit from university education so that long term our international competitiveness will increase.
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We require, above all, stable economic management which will ensure sustained economic growth and rising prosperity. I emphasise the word "stable". We do not want drastic turns one way or the other. To quote from the Red Book that we have all been using tonight:
"Economies work most efficiently when inflation is low and stable",
and that is precisely what we have got. Since inflation targets were first introduced, inflation has remained below 4 per cent. for the longest continuous period for almost 50 years. That is a huge achievement. That is the background that business requires in order to invest, grow and increase its competitiveness.
When we talk of the wealth league, let us not forget that it is business in the main that creates wealth. The voice of business is not heard loudly or often enough in your Lordships' House. It is perhaps useful to point out that the forecast income from corporation tax and business rates combined can fund more than total government expenditure on education; combined they can fund more than the budgets for defence and law and order together; combined they can fund more than 82 per cent. of the health and personal social services budget. That is why we have to encourage business and to help business, in turn, to prosper.
Therefore, I am delighted with the Chancellor's proposals for the relief of some business and agricultural assets from inheritance tax. Even more welcome is the change proposed in the relief from capital gains tax for more entrepreneurs and shareholders in family companies. That will result in skilled and successful businessmen—and women—finding it easier to release their capital into new business projects.
I said earlier that I was disappointed by one omission. I refer to the failure to abolish capital gains tax completely. Perhaps I may give my reason. There are millions of individual shareholders who invest in British business from the proceeds of their after-tax income who I am certain would increase that investment if the capital gains from that investment were not taxed. Gains from investment in premium bonds, which in my experience give a much better return than the National Lottery, are not taxed; neither are the gains from the so-called "investment" in the same lottery, so why are the gains from investment in the wealth-creating business sector singled out for continued taxation? Following what will undoubtedly be the positive increased growth resulting from this strategic economic policy, I hope that a tactical shift in taxation can be made in the next Budget and that we can say farewell to capital gains tax for ever.
All of us must be single-minded in our approach to encouraging business. To that end, I was delighted by the Chancellor's proposal to reduce the small companies rate of corporation tax to 24 per cent. from 1st April 1996. It is a staggering thought that about 350,000 companies will benefit from that reduction. It should prove to be a huge incentive to small businesses. Those 350,000 companies account for 85 per cent. of all companies that pay tax. With a wry smile I ask: how about the other 15 per cent. next time?

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If I sound optimistic (albeit rather croakily), it is because I truly believe that the economic health of business is good. Many companies are operating at a level of efficiency and effectiveness that they have never reached before. Our best companies are among the best in the world, creating wealth to underpin a social structure which is equally among the best in the world. Those are the facts. They are not just feelings. Perhaps I may suggest that we drop the phrase "feel good factor". Feelings, according to the Oxford English Dictionary, are defined as,
"A generic term comprising sensation, desire and emotion but excluding perception".
Let us have more perception and thought. I do not want to feel good. I want to perceive that things are good. I do perceive that, and I think, too, that the Budget is good.
6.40 p.m.
Lord Bruce of Donington: My Lords, my own perceptions of the economic significance of the Budget have been expressed more eloquently by Mr. Matthew Parris on page 2 of The Times today, which I commend to your Lordships' attention. However, on a purely personal level I suppose we shall have the spectacle of more clapped-out bangers in the car park outside, and there is the remote possibility of my noble friend Lord Peston lowering the whisky prices in the bars here. That is roughly the significance of the Budget to which we have been treated.
I propose to deal with three short aspects only which are in continuation of the remarks I had the privilege to make in the debate last week. I was especially glad that my noble friend Lord Eatwell referred to the significance of investment, particularly in the field of replacing lost capacity. One of the achievements of Her Majesty's Government over the past 16 years has been to preside over an economy which started out with a balance of trade surplus of £7 million and which has ended up now with a trade deficit of £7 billion. There is considerable significance in that. What caused that is simple to understand. There has been a mass destruction of manufacturing capacity in this country which has been reflected in an ever-increasing import penetration into the UK. It is as simple as that.
Even when the country has a sporadic recovery due to an artificial injection every now and again from a nearly defunct government, that is lost immediately, because when demand revives domestically there is not the domestic capacity to meet domestic consumer demand. So increased imports arrive. That is something that noble Lords opposite cannot wish away. You started off with a trade surplus and you now have a massive trade deficit which you cannot escape.
We have to have more investment. Everyone is agreed on that. A variety of inducements has been produced for those in possession of capital to invest in UK industry. Noble Lords from time to time in their own self defence, to which of course they are entitled, quote the fact that, Japanese investors in particular—there are also others—have made massive investments in the UK. What they do not say is that their friends
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who finance their own party invest most of their money outside the UK. They do not even have the confidence that their own political arm protests that they ought to have.
So, as my noble friend, Lord Haskel, pointed out in correction of my rough figures last week, for every £100 of investment invested here by countries like Japan in a vote of confidence, £160 is invested by British companies in America or in the Pacific Rim. We have to have some more investment.
Who possesses the funds? Clearly, the lower tenth of the population does not possess anything. It has no capital; its income is its capital. Who has the money? The wealthy and the institutions have the money. How can they be induced to invest? A variety of ways have been suggested: capital allowances; all kinds of hidden subsidies; all kinds of privileges; all kinds of regional grants, and so forth. All of them are very good, but what happens if they will not invest? That is a problem that Mr. Edward Heath addressed to the country in 1972, "and still you won't invest", he said to the financial interests in the City of London. Of course, investors are human. I hesitate to reproach the noble Lord, Lord Skidelsky, with Keynes's view on the subject, which I know may be unpopular. He says at page 162 of The General Theory of Employment:
"In estimating the prospects of investment, we must have regard, therefore, to the nerves and hysteria and even the digestions and reactions to the weather of those upon whose spontaneous activity it largely depends".
What was true then is true now.
I have to suggest, as was suggested in the White Paper on full employment published in 1944 by the Coalition Government, that where private investment does not find it convenient, or has no inclination to invest, then the state must. The state itself has to finance enterprises. That may not be popular to either side of the House, but it will recur time and time again over the years that lie ahead.
The noble Baroness, Lady O'Cathain, referred to small businesses and said how important they were. Indeed they are, because it is by investment in small businesses that the recovery, when it comes—if it comes—is largely likely to be propelled. What is the situation with small businesses at the moment? I can well remember the time when it was possible to go along to the manager of a small bank, have a friendly chat, discuss proposals with him, produce the necessary projection papers: cash flows, draft profit and loss accounts, and so on. Often on his own initiative he would make the necessary advance. But what happens today? One does not go to a manager any more, but to a computer operator who says in accordance with instructions from head office, "I am afraid it is quite impossible for that to be done".
Even where finance is provided by banks, it is accompanied by rates of interest and conditions which are part of a bank's plan to recoup from the small practitioners, the small businesses of this country, the losses incurred due to its own folly of investing in the South American states.

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There was also a time when it was Conservative Party policy that some efforts should be made to get the larger companies, which frequently gobbled up small enterprises, to make prompt payments to their small suppliers. There was a plan to have interest charged on overdue accounts. It was put forward by the DTI, and yet when the President of the Board of Trade (as he then was) came into being after the last election we found that that did not happen. I wonder why.
The practice followed by large corporate firms is clear. A distinguished member of one of them has already recorded the following views:
"I remember a moment in my business life when every Friday the company finance director used to bring in the list of outstanding creditors. There were three columns headed: solicitors' letters, writs received and writs whose time limits for reply were about to expire. The bills in the last column we paid".
The author of that was none other than the right honourable Michael Heseltine who admits building his business upon that basis. We may possibly have to change that.
Time prevents me from embarrassing the Government any further. With those few parting words and pleasantries, I am pleased to resume my seat.
6.50 p.m.
Lord Birdwood: My Lords, it is no purpose of mine this evening to add to the avalanche of comment about yesterday's Budget. One of this country's niche growth industries is commenting about the Budget. What the ingenious and well-timed Motion of the noble Lord, Lord Desai, does yield is a rare chance to stand back and look at the relationship between the economy and the Government. Perhaps I ought to give that a more academic colour. Perhaps I ought to say the relationship between any economy and any government.
I wish to limit myself to making one point in the form of one question. Why do no government publicly acknowledge that there are in any and every developed economy two perpetually opposed forces? These forces are the search for efficiency and the employment of people. We do not need to tangle with the sophistry of Clause 4; we do not need to worship at the shrine of free market ideology. But we do need to recognise that the more efficient an enterprise the fewer people it will employ. It is painfully, transparently obvious to the ordinary citizen but seems to be quite outside the vocabulary of Westminster, or Washington, or Paris, or Berlin.
The special areas of interest to myself are the new ingredients of innovation and technology which have become the accelerators in the search for competitive advantage. More hard science has been deployed in commerce and industry with the object of greater efficiency in the past 15 years than in the previous 50. What is the end game of this process? Every advance in, say, manufacturing technology raises productivity, makes that company leaner, more profitable, more attractive an investment and needing fewer people. So the state picks up the responsibility for those human beings now outside the virtuous circle of the efficient
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enterprise. The by-product of the efficient enterprise is taxable profit to feed a vicious circle of numerically unemployed and increasingly unemployable individuals.
The paradox is that technology is the lubricant for a country to get richer but for its people to be left staring at the prospect of the end of work. How peculiar. It is my belief that no component in the social fabric puts more strain on its stability than the universally experienced absence of work.
Following from those reflections, I am intensely interested in whether the UK economy is rugged or fragile. It seems to me that there are two expert views of the economic model and they are at odds with each other. The first is that a developed economy such as ours has built-in stabilisers so that the ship stays roughly level when the money storm strikes. The other model introduces mathematical catastrophe points where quite small variants can produce chaotic results. Personally, I lean to the latter because I think that it better mirrors the reality of political powerlessness. Some economic theorists still look for Kondratieff long cycles. Even if they were ever there, the speed with which capital moves around the world and the fine mesh of global information have consigned those ideas to history.
It is totally unoriginal to observe that markets are more powerful than governments. Companies are richer than governments and will be increasingly so. Of course we feel comfortable with these political rituals. They give all of us the chance to assess and calibrate the relationship between an economy and a government. What one perceives though in the veiled agendas of modern Budgets is the recognition of governments that more and more the moment of a Budget is an opportunity for a little social engineering rather than hauling on the levers of macro-economics. And even in social engineering, prudence is the watchword; not so much carrot and stick, more pea and twig.
Have any government cut a template for the millennium which other regimes can use as their patterns? I fear not. No, perhaps I should say that I hope not. Modern economies long ago escaped from their national boundaries. I am not saying that the future fate of future governments will be to become just a caring agency for the illiterate and the immobile. But I am saying that the time is right to bring into the open a new public debate about the relationship between government and the economy because new influences are shaping this relationship in ways undreamt of by Burke, or Adam Smith, or even Karl Marx.
6.57 p.m.
Lord Haskel: My Lords, tonight noble Lords opposite have referred to noble Lords on this side of the House as being people who run down the nation and the economy. The facts and figures on which we base these arguments come from a document called Competitiveness, Forging Ahead. It must be an accurate document because it is published by HMSO and the foreword states:
"It is a hard-headed assessment of our competitive position".
The foreword is signed by the Prime Minister.

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Pages 12 to 15 list all the countries which are ahead of us in wealth. They were mentioned by the noble Baroness, Lady O'Cathain, and the noble Lord, Lord Shepherd. I believe that before noble Lords opposite accuse us of running down the Government and the economy they should look at this book, because all the data are contained in it at pages 12 to 15.
I wish to speak about investment, which was introduced by my noble friend Lord Eatwell. Yesterday the Chancellor told us that our future prosperity depended on achieving 3 per cent. growth. Central to that must be the investment that we spoke about; that is, investment in infrastructure, education, skills, technology, new products and new markets. That must be the key to growth.
It is fair to ask: what has the Budget done to encourage this investment? The answer, as other noble Lords have pointed out, is that the Government seem to be pinning their hopes on the private finance initiative. Perhaps we can debate that in more detail when we have seen the Treasury's handbook setting out the projects to be undertaken under the scheme. In the meantime, we shall need to be convinced that the scheme is in addition to government investment and not instead of it.
My noble friend Lord Eatwell pointed out that the private finance initiative should not be used as a means of disguising government's lack of interest in the real side of the economy. For the past two years the present Government's private finance initiative has been successful in attracting around £500 million from the private sector. However, during the same period the cut in government investment in precisely the same areas has been in the order of £2 billion. That is a net disinvestment of £1.5 billion. Clearly, the Government can cut public capital expenditure with certainty, but they cannot be certain on delivering private sector funds. In the past, those funds have not been delivered. Little wonder that bodies like the CBI are wondering whether they will be delivered this time round.
Industry will find it very frustrating if imaginative schemes are announced by the Minister while, at the same time, investment programmes are cut in anticipation of them. The new concept of "sponsored investment" seems to consist only of direct government spending. I share the concern of the noble Lord, Lord Skidelsky, on the matter. If the scheme of PFI is to be extended, many problems will have to be sorted out. For instance, the very high bidding costs make it prohibitive for all but a few very large companies. The complexity of the rules make it very difficult for most firms to get involved. The PFI initiative is to be welcomed but, as we have said in the past, it has to become much more flexible and more user friendly. However, perhaps a significant decrease in interest rates will help to secure the investment that is needed.
My noble friend Lord Merlyn-Rees raised the question of jobs. We are all worried about unemployment. We are worried about the economic cost and we are worried about the social cost in terms of crime, in terms of ill health (both physical and mental) and in terms of social unrest and how that contributes towards the racial and other tensions in our society.
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The stubbornly high youth unemployment is both painful and worrying. We all know that the long-term consequences will be bad. It was with that in mind that the Shadow Chancellor proposed several ways to bring down youth unemployment. He also suggested ways of reducing the poverty trap and making the welfare system more of a pathway from welfare to work. But what has the Chancellor of the Exchequer done about it in his Budget? By reducing the tax thresholds, and reducing the basic rate by 1 per cent., he has helped smooth the passage from welfare to work, but that has to be combined with imaginative job creation schemes. What about these? We estimate that state-funded training budgets are being cut overall by 4 per cent. and the budgets of the TECs are facing cuts of some £200 million this year.
The abolition of the community action scheme next March will be a blow for many trying to get from benefit into work, particularly the long-term unemployed. It is hardly an encouragement to those many volunteers who now administer some of those schemes with such dedication.
I am not suggesting that the Government should become the employer of last resort with those schemes. But I am suggesting that the schemes and tax rules should work in harmony to get people from welfare into work. The Shadow Chancellor suggested that there should be a windfall tax on the privatised utilities to fund the passage from welfare to work, but that was ignored by the Chancellor of the Exchequer.
That neatly brings me to another matter which we discussed last week; namely, fairness in the tax system. The noble Lord, Lord Skidelsky, accused us of being the party of high tax. We are not the party of high tax; we are the party of fair tax—fairness in terms of who pays, who can afford to pay and who benefits.
I see that my time is running out and, therefore, I do not have much time to talk on the question of tax. However, on the matter of share options and the privatised utilities—where much of that unfairness lies—I should just like to say that what the Chancellor of the Exchequer has done is virtually to reintroduce the old discretionary option scheme which he found so unsatisfactory in July and call it the "company share option plan". That gives a welcome encouragement to staff share ownership having tax benefits on schemes up to £20,000. But it does nothing to stop senior executives benefiting under a non-approved scheme and is unlikely to make any difference to the amount of tax that they pay.
The Government have also ignored the Greenbury recommendations as regards publishing the full facts about pensions. Indeed, the whole business of regulating the newly privatised utilities needs urgent review. I hope that we will be told about this when the President of the Board of Trade speaks on the matter tomorrow in another place. Meanwhile, this morning we had another wonderful example of a private monopoly exploiting the public. Yorkshire Water announced a rise in its six months' profit, and increased its dividend by 10 per cent. I wonder what the results would have been if its

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customers had been able to switch to another water company. This is not the politics of envy; it is the politics of fairness.
7.5 p.m.
Lord Monkswell: My Lords, I, too, should like to thank my noble friend Lord Desai for opening today's debate in such an elegant way. We are asked to debate,
"the economic state of the nation",
and the Budget Statement. I should like to talk a little about the economic state of the nation and then make a few comments about the Budget.
I believe that we need, first, to think in terms of what we mean by the economic state of the nation. I should like to follow my noble friend Lord Merlyn-Rees, who effectively suggested that one of the criterion we need to use is unemployment. We need to make a sensible comparison between what is happening now with the economy and the state of the nation and what the situation was in 1979. The noble Lord, Lord Clark of Kempston, made some comments about 1979, but I suggest that the facts are rather different from those that he stated.
If we look back to 1979, we can see that unemployment was less than 1 million and decreasing. We can also see that inflation was decreasing and that we had a positive balance of trade in manufactures. In fact, all those situations are now virtually reversed. Therefore, how do we judge the economic state of our nation as being at all satisfactory if we have over 2 million people unemployed? The noble Lord, Lord Birdwood, suggested that the more efficient an organisation became the fewer people it would employ. That is not my definition of efficiency. My definition of the word in terms of an organisation is where the best use of all resources is made. Effectively, just on the Government's figures, we have 2.2 million people unemployed. To have unemployed resources is surely not efficient.
I must admit that it is most interesting to listen to such debates, to pick up what noble Lords say and then to wonder just on what basis they make their remarks. Can it be satisfactory that a significant part of the productive investment in this country is actually financed from abroad? I was utterly astonished to hear the noble Baroness, Lady O'Cathain, suggest that investment—I believe that she was thinking in terms of investment in industry and commerce—is the same as a gamble or taking part in the lottery. I see that the noble Baroness wishes to respond.
Baroness O'Cathain: My Lords, I thank the noble Lord for giving way. I was just drawing attention to the fact that people can actually put their after-tax income into stocks and shares but, if they put it in Premium Bonds, they would still have their capital and would not be taxed on their winnings. Similarly—and it was a flip comment—I also mentioned the National Lottery. We do not tax those gains, so why tax the gains from investment in stocks and shares?
Lord Monkswell: My Lords, I maintain my astonishment that a comparison should be made between
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investment and the other matters to which the noble Baroness has referred. However, perhaps investment on the Stock Exchange is a gamble.
As regards the Budget Statement, we need to consider the effect of the Budget. I suggest that it has carried on the Tory philosophy of reducing the tax burden of well-off people and increasing the tax burden of poor people; or rather, it is not a question of increasing the tax burden on the latter but of reducing benefits. The net effect is the same: poor people will become poorer and well-off people will become richer. I do not think that that is a recipe for improving the state of the nation. In practice it will make things worse because one injects the wrong sort of demand into the economy. One reduces the demand for locally produced goods and services when poor people have their incomes reduced. By increasing the incomes of relatively well-off people, the chances are that one will make the balance of trade and balance of payments worse.
There is one little ray of hope within the Budget but even that contains a problem. I refer to the private finance initiative. We can see that there is something like £7·5 billion of capital expenditure forecast for the next year. That is a significant amount of money for capital investment and it will generate a significant amount of economic activity. It will bring people into work and the multiplier effect will also be apparent. However, we need to recognise that there will be increased costs as regards raising capital investment on the basis of the private finance initiative rather than on public sector borrowing. Obviously the cost of capital raised by the Government directly or by local authorities directly will be less than if private firms have to raise the capital themselves.
I hope that when the Minister replies to the debate he will be able to answer my next question. I wish to ask him about the effect of the private finance initiative on local authorities. There has been reference to the fact that capital expenditure controls on local authorities will be relaxed to enable them to engage in what might be described as local PFI. My question is: is the total for the likely capital expenditure under that particular initiative included within the £7.5 billion or is that on top of the £7.5 billion that is projected in the Budget Statement?
My final question concerns Northern Ireland. I think we all understand that the situation there is fragile in terms of the peace process. We discussed that matter a little this afternoon following the Statement. As regards the Budget, what plans do the Government have for increasing capital expenditure in Northern Ireland? What plans do they have for capital investment through the private finance initiative in Northern Ireland? I think we can all accept that capital expenditure will be beneficial in that it will provide jobs and economic activity and so reduce the stresses and social tensions that lead to the breakdown of society that we have seen particularly in Northern Ireland but also within the major conurbations of mainland Britain. I hope that the Government can answer those two small questions.
I conclude by pointing out that the creative accounting that local authorities engaged in in the early and mid-1980s, prior to their being clamped down on

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by central government, provided economic activity in this country at a time when, if it had not occurred, the social consequences of the problems society was facing because of government action would have been far greater.
7.15 p.m.
The Viscount of Oxfuird: My Lords, this is a timely Motion proposed by the noble Lord, Lord Desai, and we are fortunate that his, if I may say so, usual independence and skill have enabled us to take up the cudgels this evening.
It was Benjamin Disraeli who in a message to his constituents on 3rd October 1868 said:
"There can be no economy where there is no efficiency".
How well those historic words were proven by yesterday's Budget and by the sterling record of Her Majesty's Government.
Yesterday, and already to some extent in your Lordships' debate today, we have been bombarded with a variety of statistics. I must confess that, given the wealth of good news provided to us by the Treasury and others over recent weeks, I had to resist very hard the temptation of falling into the same trap or going down the same route. I find it exciting that the IMF now predicts that the United Kingdom will grow faster in 1995 and 1996 than the G7 average, just as we did in 1993 and 1994. I also find it exciting that the United Kingdom has more people in work and fewer unemployed than any other major European country.
It would not be in the spirit of your Lordships' debate this afternoon for me to fall into the same trap as European Commissioner Kinnock did this week and question the timing of EMU convergence. However, it gives me some satisfaction that the United Kingdom is one of the few countries in the European Union that meets all of the convergence criteria which would allow us to join if we wished.
In a limited time debate such as this it is possible to deal with only one or two points. Perhaps I could concentrate on that vitally important issue of exporting with which I have been concerned most of my professional life and which is one of the strongest influences on the economic state of our nation. It is indeed heartening that yesterday's Budget gave such a boost to exporters. I ask noble Lords please to forgive me, however, if I draw your Lordships' attention to one particular matter which concerns me as one who has a special interest in exporting, and not because—we must all be precise these days—I have any direct interest or involvement in the matter.
Having for many years travelled this globe marketing British engineering equipment I have some experience of the importance attached to the purchases made by our armed forces. Experience of operations worldwide has ensured that their judgment is greatly respected by those who are responsible for major military purchases overseas. I must say that our military are always prepared to back Britain and support British manufacturers when negotiating with foreign governments. I therefore find it somewhat alarming that
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at present the Ministry of Defence is considering an alternative bid for the tender for Army field ambulances from the Steyr Company of Austria rather than the British-made Land-Rover which I am told fully complies with the tender specifications. What message would be sent out to the world if we bought other than the Land-Rover in such circumstances?
I am given to understand that the Steyr machine is of such sophistication that the driver has to be trained specially to handle the product safely on rough terrain. What happens if he is shot? Is there a spare driver immediately available? We all drive Land-Rovers, or many of us do. I am sure that there is a lesson here, particularly for the poor injured person on the battlefield. I thank your Lordships for allowing me to make that sincerely heartfelt point.
So far as concerns the thoughts of the noble Lord, Lord Bruce, on the ratio of £100 to £160—and I believe that the noble Lord, Lord Haskel, has been responsible for some of the figures in this field—that is a fascinating ratio. If we take inward investment as £100 and outward investment as £160, the profit seems to be £60, but perhaps my maths are not quite the same as those of noble Lords opposite.
That investment overseas is very important. It does not come cheap. I have had the experience of setting up companies not only in Sweden but also in the United States. You do not get something for nothing. You cannot go and borrow from the bank in Sweden. You have to put hard-earned profits on the counter, directly into the Swedish bank to establish your capital base. That costs money. That money has to come from the UK. Therefore, that £160 is good news.
Turning from the particular to the general, it is heartening to note that UK exports are currently running at record levels and are expected to grow further, helped by growth in world trade and the UK's strong competitive position.
Indeed, the UK economy as a whole is on a path of sustained steady growth and low inflation. The economy has been growing for over three years and output is now 6 per cent.—I hope your Lordships will forgive me for using a statistic—above its previous peak.
It is just not true, as some commentators have suggested in recent weeks, that our economy is heading for recession. Of course the rate of growth had to slow from the very rapid rate seen in 1994, but all the fundamentals are still in place for healthy growth. We have an enviable combination of circumstances which has already been mentioned: low inflation, sound public finances and competitive business.
Business surveys from distinguished bodies like the CBI and the EEF point to high export orders and strong investment intentions. Yesterday's Budget will underpin consumer confidence. In short, growth in the UK economy is set to continue.
We have all been bombarded for the past 24 hours with a variety of analyses of the effect that the Budget will have on each of us. It has been a field day for the economists, who have presented us with a dazzling array of often contradictory conclusions. The reality is that yesterday's Budget was steady and prudent. It was

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deliberately honed to maintain our economy in its present sound shape. It was also a fair Budget, giving a welcome boost to health, education and the police.
I have been moving about the country a good deal in recent weeks, and I sense a new mood at the grass roots. As an election approaches it is clear that the average voter is beginning to take stock and compare the performance of our present Government with the promises that are being made by the Opposition. It is fascinating that if you ask somebody whether they would support an increase in government expenditure you will find that 70 per cent. will say yes and 30 per cent. will say no, but if you ask whether they would support a reduction in tax 70 per cent. will say yes and the other 30 per cent. will say no.
I believe that yesterday's Budget will help to reinforce the growing view that in the present Government we have a tried and tested team who can be trusted not to play ducks and drakes with our economy for short-term political gain.
7.24 p.m.
Lord Diamond: My Lords, having listened to every speech from this side of the House, and agreeing with them all, one is driven to the conclusion that there is very little left to say, particularly on the topic to which I wanted to devote my few remarks; namely, the need for greater investment. However, I shall do so, because I am convinced that we are not tackling the problem with sufficient vision and seriousness.
When we talk about increasing investment, we always compare investment in our economy in one year with investment in another year. That is not the appropriate comparison. The comparison should be between what we as a nation have tended to invest over the past century and what other nations have done. I agree with the noble Viscount that we should not flood the Chamber with statistics, but if there is one statistic which I implore all of us to bear in mind all the time it is that we as a nation have throughout this century eaten more of our seed corn than any comparable nation. The independent OECD figures show that today we are still at the bottom of the league in terms of the percentage of investment in relation to national income or GDP. Although, like others, I am grateful to the noble Lord, Lord Desai, for presenting us with the opportunity to discuss this matter, I am bound to repeat that we must do much more and be much more imaginative about investment.
Not only must we invest more, we must invest earlier. We must learn the arguments for contra-cyclical investment and take them on board. Not only must we invest more and earlier, we must invest more widely, not only in capital equipment but in research, development and new products. All these are essential to achieving a growth economy which will start to turn the unemployment figures into a very different state of affairs.
An example of what worries me is the way in which the media—our spokesmen—tend to welcome an increase in imports. They say that every upturn in the economy is preceded by an increase in imports, and
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therefore we should welcome this as a sign that we are on the up and up. Instead, they should say "Here we go again", caught out once more with inadequate investment so that when the upturn comes domestic manufacturers cannot supply for the next 12 months so that we have to go abroad for something which is not necessarily better, but is delivered on time and available because overseas manufacturers have invested and we have not. They have the stocks and we have not. That is an example which I see time and time again of the way in which an increase in imports is often commented upon. It irritates me no end.
It is certainly not an easy matter to increase the level of investment in the way I have indicated. It is all very well for the large firms, which understand the need for contra-cyclical investment. It is a different matter for the medium-sized firms, which do not. It is a very different matter for the smaller firms, which cannot. They go to their bankers and say, "I want to invest in more plant, and so on. It will not be used for the time being". The manager replies, "Are you telling me that for the time being you cannot service a loan that you are asking for? You want me to wait three or four years until you receive the income from the investment to service the loan? There's the front door, my friend". So much for the help the smaller firm receives from its average bank manager, my Lords.
We and the Government have to do much more. For the life of me I cannot see why the Government are so hesitant about increasing capital allowances. Such a proposal is a direct invitation; it would be popular; it costs nothing in the long run. Of course, there is a cash-flow problem for the Government. If you give more now and less later it affects the cash flow, but overall it would cost nothing. Certainly for the small firm which is making no profits it costs nothing to set that increase against nil profits. Certainly for the new entrant which everyone is so keen to encourage it costs nothing. I should be perfectly happy to see us going straight to a 100 per cent. write off in the first year. That would be a real encouragement to firms to develop and invest. Alas, there is nothing in the Budget which encourages that or which, through greater investment and growth, would make the impact on unemployment that I regard as our first priority. Quite the opposite, my Lords. There is a slashing of government investment under the so-called formula of PFI, and the hope that someone else will pick up the balance that is needed. It is pure hope, pure speculation, and a resignation by the Government from their responsibilities.
I wish to talk about the unemployed. What I say now may not be as accurate as my normal statements. I am told that as a result yesterday of the Chancellor's enormous efforts, and no doubt the whisky as well, he fell asleep in his chair on his return to No. 11, and had a dream. He dreamt that outside was a huge line of unemployed workers carrying banners. As he read the banners he saw, "Three Cheers for Ken"; "Well done, Ken"; "Penny off standard rate"; and "No tax on your estates up to £200,000, Well done, Ken".
He thought, "This is delightful", and invited the three leaders of the delegation to come to his room in the Treasury to thank them. He said to the first, "What was

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your express view?" The man said, "I wanted to bring with me one of the group who actually paid tax and could benefit from the penny in the pound but unfortunately there was no one there. Nevertheless, Mr. Chancellor, you must realise the sincerity of my gratitude to you for what you have done". The second unemployed leader said, "I, too, want to thank you for increasing the allowance on estates. We tried very hard to find someone in the delegation who had such an estate so that he could express his gratitude more precisely, but we could not find anyone. Indeed, Mr. Chancellor, they are all bankrupt. They cannot even pay their mortgage interest, never mind benefiting by having a £200,000 estate to leave". The third man said, "Since I am here, Mr. Chancellor, perhaps I could ask you whether you had in mind anything else to help the unemployed?".
The Chancellor said, "Yes, you're good fellows. Come to this window and share my magnificent view over the square and the Houses of Parliament. There you are". And that is about the sum total that this Chancellor has done for the unemployed. The unemployed family is the only family in all the standard family calculations published at this time of year which is worse off. Others are better off.
7.35 p.m.
Lord Stoddart of Swindon: My Lords, like other noble Lords, I should like to express my appreciation to my noble friend Lord Desai for introducing the debate, which has been good and well informed.
I had not intended to be provocative until I heard the noble Lord, Lord Boardman—he is in his seat but not paying attention—and was struck by his criticism of Labour Party Members, in particular the Shadow Chancellor who, he said, would say anything to gain power. I remind him that at the last election the Prime Minister promised the country that VAT would neither be increased nor extended. However, one of the first things that the Government did was to put VAT on domestic fuel. It would have been at 17.5 per cent. rather than 8 per cent. if the Opposition, joined by one or two brave Conservatives, had not prevented the Chancellor from raising it to 17.5 per cent.
I wish to talk about the Budget. It is a Budget which fails to meet the needs of Britain, in particular the need, as so many noble Lords have pointed out, for investment in productive industry. It is a Budget which has pleased few and angered many. Above all, it will not restore the feel-good factor in the British people. At the same time it has not cured the feel-bad among Tories.
I also believe that we are still experiencing the baleful effects of the disastrous experiment with the exchange rate mechanism. The economy is still depressed. Fear and insecurity still abound. This Budget, which should be about reviving confidence, will simply leave things as they were on Monday, before the Budget. Perhaps they will be even worse, because expectations were raised which have now been dashed.
The Chancellor's and the Government's concentration on low inflation and getting the PSBR down is causing great difficulty. He is trying to get it down; indeed, he is forecasting the public sector borrowing requirement down to zero or below by 1999—in time, I fear, for
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this country to be frogmarched into a single European currency with all the harm that that will do to our economy and to the unemployed.
I want now to turn to one specific item in the Budget: the reduction of 27p. in the tax on spirits and the real reduction in all other alcoholic drinks except strong cider through the failure to increase the duty in line with inflation. Of course, a great cheer goes up for reducing tax on alcoholic liquor, but count me out of the cheering. Alcohol is a most potent drug and is the cause of enormous misery and indeed slaughter as well as ill health and sickness. One in five road traffic deaths and injuries is alcohol related. That means that two people a day are killed on the roads and every day thousands are injured due to drink driving. Millions of days are lost at work through alcohol consumption and accidents at work are often alcohol related. Vandalism, brawling, knifings and murders are often related to over-consumption of alcohol. It is also the cause of a huge proportion of wife and child battering.
Yet despite all that, which the Government know well because they have to pay for the social consequences, the Chancellor has seen fit to make the consumption of alcohol cheaper, thereby ensuring that consumption will go up. With it there will be an increase in the social evils relating to alcohol. It is morally corrupt and disgraceful that the message in this Budget has been sent out by the Government that alcohol is harmless. "Drink up and be merry", the Government say, "even if your merriment injures or kills others or results in child and wife battering". It is a great pity that it is I and not a Bishop who has to preach this evening the evils of the demon drink, but someone has to do it because it was a wrong decision. Perhaps the decision was related to the fact that the Tories have very few MPs in Scotland and many of those they have are in areas which distil whisky.
Let me turn to taxation. I agree with the Leader of the Labour Party and the Shadow Chancellor that we should aim for fair taxation. I believe that that also means reasonable, not excessive, taxation, but it should be a system where those on high and very high earnings should be expected to pay rather more than they do at present. I am not one of those who are enamoured of the slogan, "Let people keep all the money they can in their pockets and spend it as they wish". That usually means less taxation for those on very high earnings or incomes and much higher expenditure for those on low incomes. It is the latter who lose out.
The Shadow Chancellor has been criticised and even mocked for suggesting a 10 per cent. bottom rate of income tax to assist the low paid and to ease the transition from benefit to employment. In my view, that is an altogether laudable aim which should be supported and encouraged. Unfortunately, the Shadow Chancellor did not go far enough in his proposals for fair direct taxation. More needs to be done than simply proposing a new rate of 10 per cent. We need that, certainly, but it is quite absurd that people earning just over £30,000 per annum find that their tax rate at the margin jumps from 25 per cent., or 24 per cent. now, to 40 per cent. That is a huge jump and thus they pay the same rate as

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people earning 10 or 100 times as much. As well as a lower bottom rate of tax, we need a higher top rate with a gentler progression to each band.
A top tax rate of 50 per cent. or even 55 per cent. would hardly be confiscatory, if applied to high earners. Indeed, in my own view, many of those high earners would welcome a direct tax system which was seen to be fairer than the present one. They could enjoy a warm glow of satisfaction, knowing that they were making a fair contribution towards the services that we all enjoy in this country. If the number of tax bands were increased in line with a lower bottom and higher top rate, it would then be possible to arrange movement from one tax band to another in gentler steps, thus easing the transition.
No doubt I shall be told that what I have suggested would cause administrative difficulties and would not be tax efficient. However, I believe that for the longer term those ideas should be considered.
I should have liked to talk about the family, but unfortunately my time is up, so I shall complete my speech. As I said at the beginning, the Budget failed to meet the needs of Britain. The only really good thing about it is that it has probably hammered the last nail in the coffin of this awful Government.
7.45 p.m.
Lord Astor of Hever: My Lords, despite what we have heard from the other side tonight, I am convinced that the Budget will help move the United Kingdom towards our goal of being the enterprise centre of Europe. The business climate could hardly be more favourable. The recovery is well established, the economy continues to strengthen, profitability remains high and companies are in a healthy financial position. We have low interest rates and low taxes. On this point, I was interested to read a recent survey by Tribune, in which two-thirds of the Labour MPs polled said that they wanted a new higher top rate of tax. Indeed, the last speaker would agree with that. Clearly, Labour still want to penalise success and pursue the politics of envy.
Obviously, Labour does not understand business. It wants to spend on increased capital allowances when investment is already growing. It wants to introduce the social chapter and a minimum wage which would cost jobs and hold business back. Just when our companies need lower costs and lighter regulation, Labour would burden them with extra red tape.
One of the industries that has really benefited from the business climate under this Government is the motor industry, which has literally been reborn. Ninety-nine per cent. of our motor industry is owned by foreigners. A noble Lord—not on this side of the House—remarked to me at lunch last week that this fact made him feel ashamed. Interestingly, later that day I saw him drive off in a French-built car. However, it is not a matter for shame; it is a matter for celebration and is a really substantial success story for this Government. Foreign ownership is a colossal advantage, since it has brought to Britain the world's best practices in car production and greatly improved export prospects.
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Exports could account for a million cars a year by the end of the century. As production levels in British car factories rise—and both Honda and Toyota are planning significantly to increase their capacity by the end of the decade—a circle of prosperity comes into effect, both among the manufacturers themselves and in the component industry supplying them. It becomes more sensible to make all the major parts over here.
The component industry, including thousands of smaller British-owned companies, is reaping the rewards, having sharpened itself up to meet the more demanding specifications of the car makers. This in turn means that British firms are now better placed to sell abroad, although they will have to maintain their position of world-class competitiveness.
A perfect illustration of that turnaround was the announcement by Lucas Industries that they are to supply £1 billion-worth of electronic fuel injection systems for diesel engines to Volkswagen, a contract which in previous times could only have gone to the German supplier Bosch. Mercedes has invited several British companies to tender as suppliers for the first time.
The opt-out from Maastricht's social chapter is also helping the revival. Social costs here are much lower than on the Continent. A low-cost economy, union co-operation and sterling competitiveness mean few countries present so benign an economic environment for making cars. As a result, more than £1 billion of investment has been promised this year, with much more to come.
Ford is investing heavily, with plans for new Jaguar production in Coventry and engine programmes in Dagenham and Bridgend. Vauxhall has upgraded Luton with dramatic effect and Rover is still investing heavily in Birmingham to cope with booming Land Rover sales, which I hope will include field ambulances for the Ministry of Defence. Within the next six months, Ford and Vauxhall will be considering where to build the replacements for the Escort and the Astra, two of the most important models in Europe, raising hopes of further investment in Britain. There should be no contest.
7.50 p.m.
Lord Murray of Epping Forest: My Lords, one of the strong and welcome themes running through tonight's debate is the need to modernise British industry and to that end improve investment, both in physical assets and in training.
I agree very much with the noble Lord, Lord Desai, to whom we are all indebted for the debate tonight, that, while the economy above all needs a boost in capital spending, cuts in income tax have no great observable incentive effect in that direction. I agree, too, with the noble Lord, Lord Diamond, that, as history shows, most people are likely to spend their tax cuts on consumer goods, probably imported. There is certainly no assurance that the money will be invested in British industry.

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The Government rightly encourage and indeed help particular industries to invest. To that end they offer financial inducements—dare I use the word "subsidies"?—to Japanese, German and Korean companies to set up shop here, if necessary outbidding other governments. I strongly agree with my noble friend Lord Merlyn-Rees and the noble Lord, Lord Astor, as to the great advantage that such inward investment has brought to this country.
But, if it is right to encourage inward investment in this way, surely it is equally right to encourage domestic companies which are important to our future to remain here and survive. I want to descend from the macro-economic peaks that have characterised the debate to the level of examining particular industry. I want to argue that it is right to encourage shipping companies not to continue flagging out abroad, with the consequent loss of trade and earnings for Britain, to say nothing of the implications for defence. The Budget Statement signally fails to do that. However, I want to argue that it is not too late and that this matter should be looked at again.
I declare an interest as a trustee of the National Union of Marine, Aviation and Shipping Transport Officers. But my greater interest is in halting and reversing the decline of what has been, could be and ought to be a major national asset.
Shipping is not a sunset industry. Britain depends on shipping for the carriage of 95 per cent. of the exports and imports referred to so often this evening. But four-fifths of those imports and exports are now carried in foreign ships, as the noble Lord, Lord Mackay, will remember from a previous incarnation, when he graced the office of Minister for shipping. Last year, world seaborne trade hit a record total of 41 billion tonnes. By the end of the decade it will be seven billion tonnes. World shipping earnings are £100 billion a year, of which Britain now receives only 4 per cent.
Even with reduced crewing on modern ships, the demand for seafarers is growing. There is expected to be a world-wide shortage of 350,000 officers by the end of the decade. British seamen are the best there is, but they are a threatened species. In 1980, 63,000 officers and ratings were employed on ships with the UK Chamber of Shipping. Today, there are less than 20,000. As we heard this afternoon, in 1980 nearly 1,300 cadets were in training; today there are less than 400.
The results are plain. They are characteristic of so much that has happened to this country over the past generation—not merely under this present Government but under previous governments as well. British shipping has traditionally been one of the biggest earners of invisibles. Now the balance has gone into the red. Less obviously, the fleet's decline is being felt in a wide range of related industries and services—shipbuilding, shipbrokering, marine insurance and so on. British owners can no longer afford to replace their ships with modern ones, so our ships are now on average 16 years old—twice as old as they were 15 years ago. That brings into focus and illustrates a point made by so many speakers in the debate, not only on this side of the Chamber but on the other Benches as well. It is a
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challenge to us. If we could capture just one per cent. more of the world market, it would be worth £1 billion to us in terms of gross invisible earnings. But—and here's the rub—given the extent of support that foreign governments provide for their merchant fleets, the UK shipping industry cannot do it alone.
Japan is planning to extend its already big aid programme with a £300 million support package, including tax exemptions for seafarers, tax breaks for shipping companies, loans of up to £240 million for new ships. The Dutch Government introduced a shipbuilding scheme worth more than £20 million and this year is adding new special tax arrangements. Malaysia has established a £215 million fund for investment in shipping. France recently brought in new measures to encourage fleet modernisation, with a £55 million fund for shipowners and investment aids worth a further £17 million a year. I could go on.
When the Government are told what is happening and warned of the consequences, Ministers repeatedly take the line that they must work for the abolition of all aid packages. But the packages are increasing, not diminishing.
To be fair, the Government have offered a little assistance in recent years. There was the Government Assistance for Training Scheme for cadets and the Development of Certificated Seafarers' Scheme, giving grants to employers. But as we heard earlier today, the GAFT grants are not proving big enough to encourage employers to take on cadets. The Government also partially restored, in 1994, in the form of roll-over relief, part of the tax incentives withdrawn in 1984. And since 1991, deepsea seafarers have had the 183-day rule income tax concessions.
I welcome those concessions. However, the point is that, in introducing them, the Government have clearly acknowledged the need for support but they have set them at a minimal level which does not enable the British fleet to compete effectively. In other words, we are getting the worst of both worlds.
It is still not too late for the Government to have second thoughts—or for the Opposition in another place to put down amendments to achieve our national objectives. At the very least, if the Government are serious in their intention to persuade other governments to drop their subsidies, they should go in to the negotiating table armed with some bargaining counters in order to negotiate away the schemes if that is the long-term effect.
The industry does not ask for massive support. The support proposed would cost some £40 million. Less than half of 1 per cent. of the £6 billion transport budget is spent on ships and ports. The cost of doubling that to a modest 1 per cent would be minimal. The market is there and the opportunity is there, but the market is rigged against Britain. It is time we took some action to redress the balance. The Budget provides that opportunity still.
7.59 p.m.
Baroness Rawlings: My Lords, as neither an economist nor a businesswoman, I rise to speak in this debate with great reservation in a House not only filled

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with so many Budget experts, such as the noble Lord, Lord Desai, but also containing no less than six ex-Chancellors of the Exchequer.
The practice of the House as I understand it is not to have on Wednesday a Motion that is in any way controversial; but I gather from what we have heard today that that does not mean that we do not have a controversial debate.
This Budget has been hailed for weeks, nay months, by most commentators as more of a political budget than an economic one. The Party opposite had already made its comments and given its briefing criticisms on the Budget last week, long before the Chancellor had even delivered his Speech. It is difficult to believe that it already had all the details last week. Were they perhaps leaked? I think not.
There has been strong criticism from the Benches opposite but I am loath just to negate all those criticisms by reeling off a mass of statistics which go on for hours, like the old Soviets used to do. Most of your Lordships know them all already. Probably that would not only send your Lordships to sleep but myself as well. But why, whenever noble Lords on the Benches opposite discuss the economy, do they knock it? They cannot admit that Britain, far from being left behind in the world economy, is doing very well. Like the old Soviets, they prefer to look at statistics instead of realising that the Government have been prospering in the real world.
It is a tough old world out there. Our competitors in Europe and the rest of the world constantly monitor the position in Britain. They know that our key industries are more competitive than ever before. They know that investment in our economy has grown faster than in any other major European country and six times faster than under the last Labour Government. Labour closes its eyes to that and only wants to run Britain down.
I know that it is difficult to accept that your opponents are successful and on the right track, but we can only look at the hard facts. Britain is the main country in Europe for overseas investment from the United States, Japan and Korea. That means thousands of jobs. We have the necessary stability for outside investment. That is vital for our economy. I am afraid that the only thing that Labour—even new Labour—with its rush to sign up to the social chapter, will attract to Britain is more European regulations. Now even the other European countries have admitted that the social chapter does not work. Europe is following Britain's lead today while Labour is following Europe's leaders of yesterday. I remember losing vote after vote in the European Parliament for five solid years in this area because we were in opposition. But, luckily, when the real decisions were taken in the Council, we had a sensible Minister, a Conservative Minister, who was not prepared to sell our industries down the river through even more of those damaging regulations.
Britain needs strong world-class companies to compete in global markets. It needs companies such as British Telecom, which is a privatisation success story with more than £25 billion invested in Britain. That is an investment which the Treasury could never have
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afforded to give and makes BT one of the most advanced networks in the world. It considers Europe as its natural extended home market, which is critical to its globalisation plans. It is a British company operating in more than 40 countries around the world. It cannot operate successfully if it is hampered by petty rules, regulations and regulators. Its guidelines should be the competition policy set out by the GATT and the World Trade Organisation, not the constricting ropes of the social chapter. All companies, whatever their size, need a stable and sound economic environment in which to operate, where people feel secure. That is exactly what the Chancellor, in full command, has produced with this Budget.
Finally, I should like to touch on just two points in the Budget. First, there is the cut in income tax: basic rate has been cut by 1 p to 24p; that is a tax cut—the kindest cut of all; the 20p band has been widened by £700; there is the new 20 per cent tax rate on savings income. It means that 26 million taxpayers will be better off. Now, one in four taxpayers will pay tax at only the 20p rate. Secondly, at the same time, this Budget keeps public spending at 40 per cent. below GDP. That is essential for a lasting recovery. We all know that a lasting recovery will bring higher living standards and more jobs. Surely this is a responsible, sensible budget that will be proved a success not only now but, more importantly, in years to come. It is not a "quick fix" but a Budget for the long-term good of the British economy.
But the Labour Party calls this Budget "yet another failure". If it is a failure, then, remembering the great French composer Bizet, who died aged 37 broken-hearted over the supposed failure of his opera Carmen, so be it.
8.5 p.m.
Lord Rea: My Lords, most noble Lords so far have spoken about the health of the British economic situation and many have proffered remedies. I shall reverse those words and talk about the economics of the British health situation; by that I mean the health of the British people—the nation—rather than the National Health Service.
When the National Health Service was founded 47 years ago, it was expected, together with the other provisions of the so-called welfare state, based on the principles set out by Lord Beveridge, that it would level up and make equal the health status of "all sorts and conditions of men"—and by men I also mean women, even if the Book of Common Prayer from which the words are taken, along with Thomas Jefferson, did not do so, as Madam Speaker pointed out earlier today. It would do that by eliminating the five giants: want, idleness, ignorance, disease and squalor.
It is true that the expectation of life has risen. Many infections are no longer a major threat and infant and maternal mortality rates have fallen to a level which was undreamt of 47 years ago. Some of that is due to the ingenious discoveries of science as applied to medicine; but most of the improvement is due to the better nutritional and environmental conditions which have been experienced by the population, thanks to the

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improvement in the social and economic situation of the majority of the British working class during almost 40 years of nearly full employment from 1940 to the late 1970s. However, even in the days of the government of the noble Lord, Lord Callaghan, uncomfortable evidence was appearing that some sections of the population were slipping behind. That led to my late and much missed friend Lord Ennals setting up the working party on Inequalities in Health chaired by Sir Douglas Black. His report, the Black Report, was published, rather reluctantly in small numbers, in a cyclostyled version by the then right honourable Patrick Jenkin, Minister for Health, who took no action on its recommendations; and nor did the Chancellor.
The report revealed that there was an increasing discrepancy between the best off, whose health status was racing ahead, and the worst off, who had higher sickness and mortality rates over almost the whole range of diseases. Since that report, much admired as it was for its academic thoroughness, a steady mass of evidence has accumulated to show that since 1979 the gap in health has been widening. For the first time, last year a report was published in the British Medical Journal showing that mortality rates among deprived population groups in the north of England were in fact increasing. Up to then, although the health gap was widening, even the least well off were showing some improvement.
In Britain it is not merely the health of the poorest 10 per cent or 20 per cent. that should give us concern but also that of the largest group in the population: the skilled working class, classified by the Registrar General as social class 3, non-manual and manual—the office workers, computer operators, fitters and electricians. Though their health is better than that of the unskilled, they suffer more illness and earlier deaths than those in professional and managerial work, who are setting the trend in high health status, even when lifestyles deleterious to health (smoking, physical inactivity and so forth) are allowed for. In fact, Professor Michael Marmot's study of the whole range of Whitehall civil servants, from cleaners to senior mandarins, showed that, starting from the top, there was a steady deterioration in levels of health and increasing incidence of illness as one came down the scale.
Incomes in the Civil Service range from £120,000 at the top to £6,000 at the bottom, a 20-fold discrepancy. There is little difficulty in understanding why those at the bottom are less happy and die younger than those at the top. But there is a linear relationship between health status and job status throughout the range.
Dr. Richard Wilkinson of Sussex University (a proper doctor with a PhD) showed a relationship between an improving life expectancy and the proportion of a country's GDP going to the least well off—70 per cent. of the population—when comparing countries which have a GDP of over 5,000 dollars per head of population. In other words, countries with the most egalitarian wealth distribution have in recent years shown the biggest gains in health.
During the past 16 years, while the distribution of wealth in the UK has become more and more unequal, Britain has fallen a long way down the international
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league table of health statistics—that is, life expectancy and infant mortality rate—starting at No. 8 and now just passing No. 20. We have been passed by countries such as Eire and Spain and left standing by Hong Kong, Singapore and Japan, which is now the top of the league.
The Budget did nothing even to start to reverse that trend; indeed, it may even make it worse. One of the first tasks of a new Labour Government—or perhaps a government of new Labour, as the noble Baroness pointed out—must be and will be to start the process of redistributing income more fairly. A minimum wage is a start. Fairer progressive taxation is another. But, above all, by borrowing initially if necessary, we must have measures to help the unemployed back to work.
Nearly 90 years ago George Bernard Shaw wrote in Major Barbara that poverty is,
"The greatest of evils and the worst of crimes".
We may have eliminated absolute poverty in the United Kingdom—but sadly failed in the rest of the world; in fact our aid budget has stayed stable or gone down while we have reduced the price of whisky—but in Britain relative poverty is still rife. That can damage both the individual, as I have shown, and society as a whole. We tolerate it at our peril.
8.14 p.m.
Viscount Chandos: My Lords, if there were not already sufficient reasons for feeling a degree of nervousness in speaking for the first time from this Bench, on top of that I am faced with trying to wind up, on behalf of these Benches, a vigorous and stimulating debate with contributions from many of your Lordships' distinguished economists and economic specialists. As the proposer of today's debate, my noble friend Lord Desai and my noble friend Lord Eatwell, who opened, are, without doubt and without partisanship, among the most erudite economists of all. I feel as though I have been asked to sing "Nessun Dorma" equipped only with a packet of throat pastilles, in concert with two of the "Three Tenors".
When a friend heard that I was faced with this formidable task he said that he presumed, in the finest traditions of the Foreign Office, that I would speak on endogenous growth theory while my noble friends would speak on the subjects investment bankers are expert in—whatever they may be. In the result, my noble friends have shown not just their academic expertise, but also their mastery at analysing the real world in terms vividly and, sadly, painfully understandable to the layman. We should therefore be particularly grateful to my noble friend Lord Desai for introducing today's debate and enabling your Lordships' House to address the economic "State of the Nation" in the immediate aftermath of the Budget Statement.
In the limited time available I cannot respond to every noble Lord who has spoken today, let alone raise every aspect of our current economic situation or the Budget Statement's inadequate recognition of the economic mountain we have to climb. But, before I concentrate on my particular theme, I cannot help but join my noble friend Lord Eatwell in expressing my dismay at the mean-spirited foundation of the Government's Budget.

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Despite evidence to the contrary, it cannot be only noble Lords on this side of the House who feel a repugnance towards measures which, however ostensibly prudent in macroeconomic terms—my noble friend Lord Desai exposed the questionable nature of that prudence—are in some cases viciously unfair in the way the burden of taxation is maintained or even increased on those with the lowest income, while the first steps of reversing the huge tax rises of recent years are so clearly for the benefit of the better off.
I should like to concentrate my remarks on the Government's objective of achieving sustainable non-inflationary growth—something to which every noble Lord aspires and which is, of course, the only way we can in the longer term achieve the resources and the opportunity to provide a significant improvement in the standard of living for those who have been so poorly treated by this Government, as well as continued steady progress for those more fortunate.
The noble Lord, Lord Astor of Hever, echoed the phrase of the Chancellor of the Exchequer in his Budget Statement,
"Britain is the enterprise centre of Europe".
That conjures up a variety of visions. I wonder whether the Chancellor really meant the "Enterprise Centre of Europe"; the latest supranational agency for whose location we need to compete with our European partners, no doubt to the disgust of the Chancellor's Euro-sceptic colleagues. In which case, like the British Library—another great construction disaster over which the Government have presided—this Enterprise Centre is sixteen and a half years behind schedule. Countless billions of pounds have been spent (£120 billion from North Sea oil revenue alone) with only so much to show for it. Or was the Chancellor thinking of a role in Europe akin to that of Hong Kong or Singapore in South East Asia—this sudden and simplistic discovery by the Conservative Party of the so called "tiger economies"? If so, I am afraid that the Government's policies over a decade and a half and the measures proposed in the Budget Statement will do no more than deliver an economy with the characteristics of a mangy old alley cat—in poor shape; inadequately housed; with insufficient investment behind it, but always on the prowl for a short-term opportunity.
My noble friends and our colleagues in another place have made it perfectly clear that we are centrally and fundamentally committed to an enterprise economy at the very heart of a market-based system. Professor Patrick Minford, who seems to think that his position as one of the three remaining so-called "wise men" advising the Treasury, is an appropriate platform for facile political invective, is quoted today as saying that our party's intentions towards a low tax, free-market economy are at best doubtful, at worst damagingly hostile. That is absolutely untrue, as Professor Minford will in due course find out, though I cannot hazard whether my right honourable friend Gordon Brown will have the benefit of Professor Minford's advice at that time. The noble Baroness, Lady O'Cathain, and the noble Lord, Lord Skidelsky, who should know from our
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shared creation of the Social Market Foundation of my personal commitment to a market economy, can, I believe, likewise be reassured.
What we on these Benches are committed to is an enterprise economy in which the opportunity for enterprise and the benefits from enterprise are open to everyone, not just those whom the Government will now permit to avoid inheritance tax above the hugely increased threshold by acquiring shares on the Stock Exchange's alternative investment market, the latest in a long line of the Government's ill-advised and economically distorting tax shelters for the wealthy. I might add at this point that, whether or not there is a case for differentiating between the capital gains tax rate on short and long-term gains, it is both wrong and unrealistic to contemplate what the noble Baroness, Lady O'Cathain, and indeed the Prime Minister suggest—the outright abolition of capital gains tax.
We are committed to an enterprise economy in which, as my noble friend Lord Eatwell has argued, careful measures to stimulate productive capital investment by both the public and the private sector creates an atmosphere of confidence for industry and consumers alike—which in turn creates the sustainable, non-inflationary growth which this country needs and is entitled to. In the absence of the noble Lord, Lord Skidelsky, I will risk suggesting that, if low interest rates alone were sufficient to stimulate adequate levels of investment, the historically low interest rates of the past three years should not have allowed the serious shortfall in investment which is now apparent.
We are committed to a low-tax market economy, where the low taxes apply to those on low incomes and not just to those on high incomes. Last week, regrets were expressed in your Lordships' debate on the gracious Speech that the Labour Party had advocated a lower tax band, of 10 or 15p in the pound, thereby, in the eyes of some of your Lordships, creating a competitive bidding process for lower taxes. How odd. I thought competition was now accepted on all sides of the House to be good. And we were not competing to cut the taxes for those already well paid, well off and fully employed. We want, as my noble friend Lord Eatwell spelt out so clearly, to lower taxes and eliminate distortions in the benefits system and to remove the disincentives for those out of work or on welfare to take up employment and join the enterprise economy themselves. Sixteen years after this Government reduced the top rate of income tax to 60p in the pound, they have still left unchanged effective marginal tax rates for those out of work or on low earnings of 90p or more in the pound. Sixteen years, my Lords, the time from birth to school leaving age, and noble Lords opposite and their colleagues in government have learnt nothing, forgotten nothing.
Investment, as so many noble Lords on this side of the House have argued—none better than my noble and valued friend Lord Diamond—is the key to a more prosperous future than our Tory past; investment in education, investment in training, investment in technology, machinery and equipment. That is why, in the face of the relentless squeeze on productive public

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sector investment over the past 16 years, my right honourable friend Mr. Prescott proposed the principles of private finance for the public sector and why we therefore support, as preferable to the alternative, the PFI. I should declare an interest at this stage, that a company of which I am a director has a subsidiary which acts as consultants to NHS trusts in seeking private sector finance. But, for the same reasons as those advanced by my noble friend Lord Eatwell, I have serious concerns that PFI is not the best long-term way of addressing the issue. How much better would it be to tackle the underlying inconsistencies in the country's public accounts and restore, as the noble Lord, Lord Clark of Kempston, proposed from the Benches opposite, a proper, updated distinction between capital and current expenditure, so that the appropriate financing of productive investment can then be gauged and implemented.
I cannot end without taking one further example of the Government's cock-eyed priorities, so requiring me to declare another interest, as a director of English National Opera, which, as a supplement to its buoyant box office revenue, depends on Arts Council grants. At the same time as proposing a cut of more than £60 million in the funding available to the Department of National Heritage, and hence a 3 per cent. cut to the Arts Council, this Government propose to exempt classic cars from road fund tax at a cost, estimated today by experts in this field, of at least £25 million per annum, without even allowing for the costs of ensuring by other means adequate standards of safety. I would not want to impose any financial hardship on the noble Lord, Lord Monson, and, with a lifelong interest in cars, bear no ill will towards other classic car owners. But can it really be right, in considering the quality of life for those in a position to enjoy life, that we should threaten our national heritage and culture in order to exempt cars of more than 25 years of age from tax—let alone freeze the lone parent's allowance, at a saving of only half what is handed to classic car owners?
My Lords, this is not a Budget whose immediate reception should give the Government much encouragement:
"Budget blues put f near record low",
reads today's Evening Standard headline. "You can't buck the markets", said the Prime Minister's predecessor. And is it surprising that the pound is weak when the Government's own forecasts in the Red Book (Tables 3.1 and 3.3) predict continued loss of market share in our export markets?
Nor do I believe that this Budget will be better regarded in six months' time, as some of the Government supporters try to find comfort in thinking. It is mean-minded and inadequate now, and it will be mean-minded and inadequate then, when the long-term problems in our economy will be ever more cruelly exposed.
The noble Baroness, Lady Rawlings, has cast her right honourable friend the Chancellor as a latter-day Bizet, the composer of one and a half successful operas. I look forward to the many future Budgets of the Verdi of prospective Chancellors, my right honourable friend
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Gordon Brown, and the prospects then, despite the run-down and underinvested economy he will inherit from this Government, of sustainable, non-inflationary growth and progress towards full employment once more.
8.28 p.m.
The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish): My Lords, I welcome the noble Viscount, Lord Chandos, to the Front Bench. I hope he survives longer on the Front Bench than his noble friend Lord Desai, who thought a few unthinkable thoughts and found himself back on the Back-Benches. The debate has gone on perhaps a little later than many of your Lordships thought. I therefore appreciate that some noble Lords have had to go because they had planned their day on the basis that our debate would last for four and a half hours and would be over by 7.30 p.m. Therefore, I fully understand that some noble Lords have had to leave.
It has been a very interesting debate. I am always grateful when the noble Lord, Lord Desai, speaks. The noble Lord and I joined your Lordships' House at the same time and for many months we both found ourselves very much at the bottom of the batting order, usually fairly adjacent to each other in any debate in which we were involved. But I notice today that the noble Lord has managed to get himself at the top and myself at the bottom, so some progress has been made. I say also to the noble Lord, Lord Desai, that I always enjoy his speeches. He is an economics professor under whom I might have enjoyed being a student—not that I was ever a student of economics and, as some may say, that will be apparent shortly. Like most of the rest of the world, I did not study economics. However, I believe that I might have enjoyed studying under the noble Lord, Lord Desai. I am not sure whether I would have enjoyed studying under his noble friend Lord Eatwell. I might have found it a little uncomfortable. Nonetheless, I am sure that it would have been as equally interesting.
The overriding aim of this Budget is to maintain a healthy and sustainable rate of economic growth because without growth, there can be no prospect of improved public services, more jobs and higher living standards. The British economy is growing steadily. The recovery is now in its fourth year. Growth has been well balanced and output is at record levels. Exports have been strong; business investment has started to pick up and consumer expenditure has been on a steady upward trend. Unemployment has fallen by over 700,000. Businesses have created half a million new jobs and inflation remains low. It is no wonder that the OECD said that our performance last year was "impressive". It praised the pace-setting reforms that the Government have implemented since 1979, which have immeasurably improved our competitiveness.s
Although growth has indeed slowed in recent months, as some noble Lords have pointed out, it has not stopped in its tracks, as perhaps some have tried to suggest, but far from it. All the indications are that growth will continue at a healthy rate into next year and the year after. The fundamental ingredients are all there; namely,

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low inflation, sound public finances and competitive businesses. Seldom can a Chancellor have delivered a Budget against such an encouraging background as my right honourable friend did yesterday.
It is not just the Government that expect the British economy to continue growing at a healthy rate, as my noble friend Lord Oxfuird said; it is also the view of independent forecasters. He drew our attention to the IMF and no less a body actually expects Britain to join Germany at the very top of the G7 growth league next year. Exports have very much led the recent phase of the recovery and they are at record levels. They are competitive, highly profitable and they are benefiting from expanding world markets.
I listened, as I always do, with great interest to the noble Lord, Lord Bruce of Donington, who talked about the mass destruction of manufacturing capacity. The noble Lord lives in an unreal world. I might agree with him if he had said that there have been massive changes in the nature of our manufacturing capacity, but to talk about "massive destruction" shows that the noble Lord, like many others, tends to think about manufacturing industry as the traditional manufacturing industries we had many years ago and not the new manufacturing industries. Exports of goods are up by 6.5 per cent. in volume terms over the past year. Export growth last year was the fastest for 20 years. United Kingdom exports in volume terms are indeed at record levels. We are now Europe's largest exporter of items such as computers and colour televisions. I suspect that one of the problems we have in this debate is that some noble Lords do not recognise these items as manufactured products. They are the modern manufactured products.
We must not forget the export of services and our investment income, the so-called invisible receipts, largely coming from work in the City of London. Taken together, these account for around one-half of all our overseas earnings. We are the only major country with substantial invisible surpluses. The success of our exporters has helped us to achieve current account surpluses with the rest of the G7 countries and with the four Asian tigers. The noble Lord, Lord Shepherd, rightly pointed out something that we always have to remember—that is to say, we have not only to compete in Europe, which is a very important market, but also around the world because we are a major trading nation. We depend not only on the European Union for our markets but also on the rest of the world. We have a current account surplus with these Asian tigers; namely, Hong Kong, South Korea, Singapore and Taiwan. Overall, our current account deficit remains very modest in relation to our GDP.
Investment is picking up where firms need to expand capacity and adapt and adopt new technology. The climate for investment is excellent. The recovery is well established and profitability is high. I say to the noble Lord, Lord Diamond, to whom I always listen with great interest, that it is much more important than giving investment allowances to ensure that companies have good, high profitability on which they can base sensible long-term investments. These company finances are strong. Company tax and
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interest rates are low. Business surveys show strong investment intentions. Indeed, investment in the manufacturing sector is already 12 per cent. up over the past year to its highest level for four years.
I understand noble Lords who say that in the great tables of things the situation does not look as obvious as I am trying to make it. We are accused as a country, and more than just as a Government—the noble Lord, Lord Diamond, again spoke about over 50 years—of not investing enough. An interesting thing is that the noble Lord, Lord Desai, who introduced this debate, wrote in a recent article in the New Statesman:
"The United Kingdom notoriously invests a lower proportion of its GDP than, say, Japan or Germany, but the rate of growth of the UK economy is not that much lower. The British get bigger bangs for the bucks from investment than the rest. It is not fashionable to say this, but after all, it is outputs that matter and not inputs".
We ought to bear that in mind.
The story of investment is good. Total investment has grown faster since 1979 than in France, Germany and Italy and about six times faster than it did under the last Labour Government. The manufacturing productivity gap between us and our main Continental competitors has been narrowed substantially from between 30 per cent. and 50 per cent. in 1979 to just 10 per cent. now. The gap actually widened under the last Labour Government.
My noble friend Lord Boardman rightly pointed to inward investment, as a number of other noble Lords have done. That is very important. I say to the noble Lord, Lord Merlyn-Rees, that that inward investment has helped very many parts of the country which have had serious unemployment problems. He discussed Wales; I could discuss Scotland.
Without going on too long, perhaps I may list one or two of the most recent stories of inward investment in this country. Chunghwa Picture Tubes Ltd. from Taiwan has just announced a £260 million investment in Mossend in Lanarkshire, creating 3,300 jobs in manufacturing, which will go a long way to replace the unfortunate closure of the steelworks there. Lexmark International of the United States is going to Rosyth, Fife, to create 500 new jobs. To show that I am not looking just at Scotland, Fujitsu from Japan announced an £800 million expansion at its County Durham site, creating 500 new jobs. Nissan has a £250 million investment in the north-east. Siemens from Germany announced its decision in August to build a new £1.1 billion semi-conductor plant in North Tyneside, creating 1,800 new jobs. The whole House knows that I could go on with a number of other examples in recent times and, indeed, other examples where the factories are now up and running.
By keeping inflation low we have managed to keep interest rates low. I believe that that is very important from the point of view of investment and jobs. I thought that my noble friend Lord Birdwood was being unnecessarily pessimistic in the view that somehow or other improved technology and efficiency would inevitably lead to fewer jobs. I do not believe that that is necessarily true. Perhaps I may commend at least part of a speech by the noble Lord, Lord Peston, in the debate on the Address last Thursday, I believe, where,

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from the point of view of an economist, the noble Lord addressed that problem. I shall perhaps address it in a more simple way and point out that countries like Japan and the United States, which are arguably the most technologically advanced societies, have kept unemployment low and they are still at the cutting edge of those changes. So I really do not think that we need to be pessimistic about it. However, we have to make sure that we are in a position to seize any opportunities for such new investment. Dare I say that as a cultural change we need to accept that those new products are manufactured products every bit as much as the ships or railway engines which the industrial areas of Tyneside and Clydeside once produced?
We should not be too pessimistic about employment. We should remember that we have more of our people in work than is the case in other European countries. I gave the figures the other day. Sixty-eight per cent. of our population of working age are in employment. The figure for Germany is 66 per cent., in Italy it is 51 per cent., in France 60 per cent. and in Spain 45 per cent. We should remember that that is the other side of the unemployment figures. I now live in Glasgow and although I did not represent that area when I was in the other place, I know about the pockets of serious unemployment. I do not minimise the difficulties for the people who live there. However, there is no point in trying to paint a picture of Britain as somewhere where there are only unemployed people. We should not paint a pessimistic picture of Britain, especially if we want to encourage people to buy from us or to come here and invest.
While I am giving comparative figures, perhaps I may look at this from the viewpoint of unemployment. On the ILO base—I am trying to be as reasonable as possible to noble Lords opposite—unemployment in the UK is 8·2 per cent. In Germany it is 8·4 per cent., in Italy 11·3 per cent., in France 11·4 per cent. and in Spain 22·2 per cent. All of your Lordships are rightly worried about the youth unemployment rate. In the UK it is 13·6 per cent. I think that we can all agree that that is far too high and, indeed, Germany is doing much better with only 8·3 per cent. However, the youth unemployment rate in Italy is 31·8 per cent., in France it is 27 per cent. and in Spain it is 40 per cent.
I am not too surprised that noble Lords opposite did not talk much about the social chapter and the minimum wage because one of the interesting things about the figures that I have just given is that the countries in almost the worst position among the major players in the European Union are France and Spain which have the lethal combination of the minimum wage and the social chapter. Those are the countries with horrendously high rates of youth unemployment, with general unemployment and with a much lower percentage of their population in work. So I do not think that we should paint too gloomy a picture of the position in this country when one looks at how our near neighbours are getting on in terms of their employment and unemployment figures.
Not many noble Lords mentioned inflation, although my noble friend Lord Boardman is an exception. I am not surprised by that because we are now enjoying the
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best inflation performance for almost half a century. The underlying rate has been at or below 4 per cent. for 38 consecutive months. We have achieved that by setting an explicit inflation target and by putting in place some of the most open and transparent arrangements for monetary policy in the world. Thanks to the brave decision that was taken last year by my right honourable friend the Chancellor to increase interest rates when the economy was coming under pressure, we believe that inflation is now close to its peak. The cost pressures from higher commodity prices and the depreciation of sterling are now easing. Cost pressures in the labour market are also noticeably subdued. We expect underlying inflation to fall steadily.
I believe that with continued care we have broken through the psychological barrier that we have had in this country for far too long of accepting inflation as something with which we have to live. One of the great strengths of the German economy is that neither the politicians nor the people there have accepted that philosophy. I do not want to go too far in this aside, but I also think that living with high levels of inflation has meant that when we do come to a prolonged period of low inflation people do not feel as well off as they thought they used to feel because they thought that getting more money in their pockets, for their houses or in any other way was an indication of increasing wealth when, against a background of rising inflation, it certainly was not.
I turn now to government borrowing. Sound public finances are vitally important. The less the Government borrow, the easier it is to keep down interest rates. The noble Lord, Lord Desai, argued that point in his article of a fortnight ago and again in his speech today. That is good news for business, good news for investment, good news for home owners and good news for jobs. Sound public finances are essential to sustain economic growth. No country can expect to run a large budget deficit for long without getting into trouble. Under the last Labour Government, the PSBR reached nearly 10 per cent. of national income—and we all remember what happened. Inflation and interest rates soared. The economy collapsed, and eventually we had to call in the IMF. In doing so, we encountered the only time in the post-war period of the UK economy when real spending has been cut. It was cut by 7 per cent. and, in the words of the noble Lord, Lord Desai, it was a "traumatic experience" and it is an experience to which this Government have no intention of ever subjecting this country again.
We have to take tough decisions. Governments often have to do that. We often have to risk short-term unpopularity in order to get our public finances back on a sound footing. Borrowing always increases in a recession, but once the recession is over, as is ours, the Government need to make sure that borrowing comes down again. This Budget keeps government borrowing on a clear downward path by keeping tight control of public spending. The PSBR, which stood at £45 billion two years ago, will be reduced to £29 billion this year and will continue to fall in the years to come. Indeed, with government borrowing here falling faster than that of any other major European country, we are on track to achieve

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a balanced budget by the end of the decade. We have managed to do it before and I am sure that we shall do it again.
The key to lower government borrowing has been tight control over public spending. In his three Budgets my right honourable friend the Chancellor of the Exchequer has succeeded in slashing £53 billion off previous expenditure plans. The new plans allow for real growth in public spending of just one-quarter of 1 per cent. per year. By 1997–98 we will have met our target of getting public spending below 40 per cent. of national income.
We have re-examined and refocused our spending priorities and there is more money for some of the key public sectors about which people care such as schools, hospitals and the police. I believe that people are offered a fundamentally flawed choice when it is suggested that we can either reduce taxation or spend more on health and education. I believe that with a healthy economy one can successfully do both.
We intend to spend more on education and to build on the considerable improvements that we have seen in the past 16 years in education and in the outputs of education. Today about one in three youngsters goes on to higher education; 16 years ago that figure was one in eight. The number of youngsters staying on at school today after the leaving age of 16 is markedly larger than 16 years ago. I am certain that we all applaud those improvements. Of course, we want to do better and, with the extra spending, I am sure that we shall do better.
The noble Lord, Lord Rea, rightly pointed to the importance of the health service. We have put more money into the health service in every year of our term of office and will do so again this year. Perhaps unfortunately for governments, the cleverness of doctors and the advances in medical technology create their own pressures for higher spending. Today many operations, procedures and medicines are available which were not available 16 years ago but—dare I say this wearing my Treasury hat—they all seem to cost a great deal more money. That is something that we must face up to. As I have said, we have put a lot more money into the health service and many new hospitals have been built and are now open throughout the country. One or two of them even bear my name on either the foundation stone or plaque.
We have put more money into those two important areas of government spending. We have done so to help young people in school and to help people when they require the National Health Service—
Lord Rea: My Lords, perhaps I may intervene because the point of my remarks was not to say that more money needs to be spent on the health service; it was to say that much of the ill health in this country is due to inequalities in income. The poorer people are, the less healthy they are. The best way to improve the health of the nation is not necessarily to improve the health service but to improve the economy and to make the distribution of income more equal.
Lord Mackay of Ardbrecknish: My Lords, we are, as I have been trying to argue, improving the country's
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economy. We are seeing unemployment come down. We are seeing people finding jobs and having higher incomes. All those things do, indeed, count. However, I suspect that were Ito say to the noble Lord that we were cutting the NHS I would be hearing a slightly different story from him. One cannot just say that there are other factors. The improvement in health care and the cleverness of physicians and surgeons at childbirth, for example, have meant that the statistics for perinatal and neonatal mortality have come down hugely in all social classes, as I believe the noble Lord would accept.
I should like to turn to one aspect of the debate which was dealt with by the noble Lord, Lord Eatwell, and many others. It was about public spending. At about £22 billion, public sector capital spending, which includes the PH, will remain well above its 1980s levels, and the private finance is being mobilised on an increasing scale. We expect about £14 billion of PH projects to have been signed up by 1998–99. That goes well beyond any reductions in public sector capital spending. There are a number of projects, of which all of your Lordships are aware, which are being financed in that way: London Underground, parts of the road network and so on.
I was interested to hear confirmed today by two noble Lords opposite what I heard on television on Sunday: Mr. John Prescott claims to be the originator of the scheme for PH. I wish that he would tell the Labour Party in Scotland, and particularly his colleague Mr. Brian Wilson, who I believe is currently its transport spokesman, because one of the really exciting PH projects in Scotland has been the bridge "Over the Sea to Skye". It is being constantly attacked by the Labour Party largely because the word "private" is associated with it. The noble Viscount, Lord Chandos, suggested that the new Labour Party is interested in entrepreneurs. If he were to read the Scottish papers for a few days he might think that he was talking about a different Labour Party or that his colleagues north of the Border had not yet quite picked up the message that they approved of these entrepreneurial projects.
Lord Graham of Edmonton: My Lords, pie in the sky!
Lord Mackay of Ardbrecknish: My Lords, it is not pie in the sky, as the noble Lord says. The Skye bridge exists, so it is more than pie in the sky.
I was going to try to be 25 minutes, but I gather that we have some time in hand so I can turn to one last aspect of the debate. That is: why cut taxes? One of the reasons we cut taxes is to encourage people. The noble Lord, Lord Bruce of Donington, talked about the importance of small businesses. When I listened to him I thought to myself: what do my friends who are small businessmen complain about when I talk to them? They complain, not about the lack of hand-outs from the Government, but because they want the Government to take their hands off them in many ways, including taxes.
There is still a fundamental difference in principle between speakers on this side, who believe that the most successful economies of the future will be low-tax countries with small public sectors and deregulated economies, and those on the Benches opposite who

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believe in high public spending. Fortunately, the tide of public opinion and history is on our side. That has been the message of the previous three general elections.
I make no apology for our Budget, which leaves ordinary people with more of what they earn and save; boosts incentives; encourages enterprise; and creates wealth and employment. My only regret is that because of the recession we were unable to do it sooner.
The Budget takes three more steps towards our goal of a 20p basic rate of income tax. Basic rate has now been cut to 24 per cent., the 20 per cent. band has been widened, and there is a new 20 per cent. tax rate on income from savings. That means that one quarter of taxpayers will pay income tax at the 20p in the pound rate only. A number of other people have been taken out of taxation by the increase in personal allowances. All those things help everyone: they help the low paid, because they will be helped by the widening of the 20p tax band and the increase in the bottom limit; and they help business in particular.
Perhaps I may turn to the noble Lord, Lord Desai, who started this interesting debate. He indicated—I do not believe that anyone dissents from this—that he would like to see interest rates down by 0.75 per cent. We shall not achieve those reductions in interest rates if one seeks a high tax/high spend economy. It will just not happen. I do not believe that the party opposite has changed its view on taxation. Indeed, in the article I quoted—I should have liked to have quoted a lot more of it, but time prevents me from doing so—the noble Lord said:
"All macho tax-cutting hype should be avoided. I want Gordon Brown not to match them"—
that is us—
"in this immoral exercise"—
that is tax cutting—
"but to keep his hair shirt on and make it clear that Labour will not match their tax cuts, but will reverse them".
So I shall be interested to see whether in the other place the party opposite votes against the tax reductions my right honourable friend has presented to us.
This Budget will leave people with more of what they earn and more of what they save. It is a Budget which spends more on the services about which people care, while keeping public spending as a whole under the tightest control. It is a Budget which keeps public borrowing on a clear downward path and takes no risk with inflation. It is a Budget which sustains economic recovery and helps make Britain the enterprise centre of Europe.
Lord Desai: My Lords, at this late hour I do not wish to say very much. I wish to thank all noble Lords who have taken part. In particular, I wish to congratulate and welcome my noble friend Lord Chandos on his first appearance on the Front Bench. The Minister wished him well and a longer stay on the Front Bench than I had. My only advice to him is not to write any articles in any Left-wing newspapers. Your friends will not read them, but the Government will read them and quote them. That has
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been my sad experience, but I shall not learn from experience; I shall go on writing. I beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave, withdrawn.

Western European Time Bill [H.L.]
8.57 p.m.
Viscount Montgomery of Alamein: My Lords, I beg to move that this Bill be now read a second time.
After the Budget debate and the Statements that we have had at some length, we move briefly to a subject which I hope will produce greater consensus. In bringing this matter to your Lordships for the second time in the same calendar year, I have two objectives in mind: first, to persuade Her Majesty's Government to take the matter seriously, and to stop sitting on the fence; and, secondly, to ensure that time to consider it properly is given in another place.
The Bill introduced by my noble friend Lord Mountgarret did not even start in the other place. I have had a number of conversations with Members of another place to see whether we cannot rectify that position. I have also had a great piece of fortune in that Mr. John Butterfill, the Member for Bournemouth West, who drew first place in the ballot, has decided to take this subject for his Private Member's Bill. In the event that we give the Bill a Second Reading tonight and that we pass it in due course, we can look forward to a twin-track approach to the subject in another place—twin-track is fashionable at the moment.
This is a short Bill, comprising eight lines only. The Bill differs from the Central European Time Bill, which was so ably presented by my noble friend Lord Mountgarret on 11th January, in three main aspects. The first is the title which I feel better represents the geographical area of which the UK is a part, comprising France, Germany, Italy, Spain, Portugal, the Benelux countries, and Switzerland. Those countries are normally considered to be part of western Europe. Secondly, it carries a clear definition in Clause 1 which explains what is intended—that is, that we would have what is normally called British summer time in winter and British double summer time in summer. Thirdly, it covers the whole of the United Kingdom. Even the most severe opponents of the proposal will agree that whatever we do the United Kingdom must remain in one time zone.
I do not believe that it is necessary to rehearse the arguments at any great length. They are set out in detail in the Second Reading debate which took place on 11 th January and which noble Lords can read in Hansard at col. 243. In summary, the objectives of the Bill are supported by all outside organisations concerned with transport, road safety, tourism, sport and leisure together with industry, commerce, banking and all the financial services of the City of London which contribute so much to the national well-being.
I believe also that there has been a groundswell of public opinion supporting the idea. For instance, the issue came up recently in the radio programme "Any

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Questions?". After discussion, the programme presenter took a straw poll of the large audience. That produced a near unanimous vote in favour of the proposals. There has been a great deal of correspondence following on from that.
When the matter was previously discussed in this House in January my noble friend Lord Mountgarret was fobbed off by my noble friend Lady Trumpington—she is normally a most robust Lady—with a lengthy speech which regrettably signified little. As an aside, noble Lords may be aware that my noble friend Lady Trumpington is recovering from a knee operation. I am sure that it is the wish of the whole House that she makes a speedy recovery and returns to us in her normal full vigour.
Noble Lords: Hear, hear.
Viscount Montgomery of Alamein: My Lords, my noble friend Lady Trumpington made one comment which gave us slight encouragement. She said that the Government would continue to consider the matter. That indeed is what has been happening for a very long time. But as another 10 months have elapsed I hope that the Government will take a more positive line and I look forward to hearing what my noble friend Lord Courtown has to say about it tonight. Surely, what is now required is not consultation but decision and action. I beg to move.
Moved, That the Bill be now read a second time.—(Viscount Montgomery of Alamein.)
9.3 p.m.
Lord Howie of Troon: My Lords, I rise to speak on this subject with a certain amount of dismay. It is not long since we discussed it last January in a Bill which was, I said then, bizarre. I actually meant idiotic. It created a time zone between Scotland and England. This Bill is much more sensible and therefore has to be taken seriously. However, I must say with a certain amount of distress that the matter is to be raised in another place by a Member from one of the most extremely southern constituencies in the country. He will consider an amendment which allows for a separate time zone in Scotland as against England. Clearly, bizarre notions are not confined to this House. I hope that he pulls himself together before he introduces the Bill.
My objections to the Bill are well known to your Lordships and I do not need to go into them in any great detail—although I might if I am urged! They are simple and have appeared in Hansard on several occasions. Indeed, this is the third time in two years, which is quite preposterous. Perhaps I may say in parenthesis that I do not believe that this is a proper measure for a Private Member's Bill. It is a national matter and should be taken up, or rather left alone, by the Government.
The first objection is what we might call the Scottish dimension. It is a serious matter but has been dismissed in some parts of the press as being the objection of a minority. Some members of the press have said that the minority should yield to the majority. But in this case the minority are put to substantial inconvenience for the
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convenience of another minority. It is not for the convenience of the entire English people, such as they are, but for a small group within them.
The question of time is not only a matter of north and south but of north and south combined with east and west. The globe is tipped over and the sun goes round it or it goes round the sun. I am not quite sure which but one or the other is right. It amounts to the same thing in the end. Not only that, but the country is tipped over so that Bristol, for example, is further east than Edinburgh. The east-west element is extremely important with the result that the real time in Glasgow is 45 minutes behind the real time in London. That 45 minutes is quite substantial, especially on a Glasgow morning in January or February. I have been there often at that time and I know that it is a dismal experience. It is not a happy time. It is cold, miserable and dank and it is also dangerous.
If we leave things as they are, in the dead of winter the dawn in Glasgow will be at about a quarter to ten. The noble Lord, Lord Tanlaw, quibbles about that and keeps producing the time in Inverness. But Glasgow is more important in that respect. I see that the noble Lord wishes to respond. I give way.
Lord Tanlaw: My Lords, is the noble Lord aware that, although he is quite right, the sun set today in Glasgow and in Inverness only a mere 15 or 16 minutes before it did here in London?
Lord Howie of Troon: My Lords, it is the word "mere" that bothers me. I am not talking about November; I am talking about January and February.
Lord Tanlaw: You said the same last time!
Lord Howie of Troon: My Lords, I take the point. I did not think that I would stir up the point quite so readily. I apologise to the House for so doing. Indeed, it was accidental. Had I meant to do so, I would have done it more seriously.
However, if we adopt the Bill, it means that dawn in Glasgow will not be at 8.45 but at 9.45. Let us think about it. It means going to work in the dark. It is bad enough going to work in the light, but it is infinitely worse to do so in the dark. You feel awful. It is dark, cold, miserable and dank. You need to think about it as though you were in Glasgow and not as though you were in Bournemouth, London or some such salubrious spot.
I have nothing further to say in that respect, except to point out that Belfast and Londonderry are on the same latitude as Glasgow but further west. So it is worse in Belfast and Londonderry, but it is even worse in Sligo because it suffers two disadvantages. The first is that it is further west than Londonderry but it is also in another country. If we are going to suggest that there should be a time difference between Sligo and Londonderry—in other words, between Northern Ireland and the Republic—I do not know what Gerry Adams would make of it. I do not believe that he would like it very much. Indeed, it would not help.
Perhaps I may turn to my second objection about which the House is already aware. I shall be very brief. I refer to the dangers and the technical difficulty which

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would be experienced by the construction industry if such a change took place. I have explained the technical difficulty before; namely, that you can conduct concreting on a construction site at a temperature of about 3 degrees centigrade. On winter mornings, you do not get that at dawn; you get it much later. Therefore, what would happen in such a case is that the time at which concreting could be done would be thrown an hour further into the day, with damage to the construction industry. That damage has been calculated, but such calculations are always very subjective. Unfortunately, when we last debated the matter, the Official Report quoted me as saying that the damage to the industry would be £4 million a year, but it is actually £400 million. Nevertheless, the Government are doing damage to the construction industry every time they open their mouth, so perhaps that £400 million a year would be a minor—yet serious—matter.
The second consideration is the fact that big building construction sites are dangerous places. I say that because they are temporary. The temporary works which they contain are scaffolding, boarding, ladders and so on. They can be slippery because of frost and ice. That frost and ice is there in the early morning and people can be injured. They may fall and be hurt, and yet it is suggested that we add another hour which means that there will be an hour of further danger. It is not an insignificant point. I know that it involves a minority and that there are only about 1.5 million construction workers but, nevertheless, they are a significant body of people. So we have the cost problem to the construction industry and the danger problem.
I should like to say a few words about tourism. I know that my personal noble friend Lord Mountevans—although I am not sure whether that is how I should put it—is deeply involved in tourism. He will no doubt tell us about the advantages to tourism which the extra hour would provide. But I would like your Lordships to consider whether people really visit places as tourists because of the light. Indeed, do they? For example, if you go to Egypt, you will find that it gets dark round about 6 o'clock in the evening, but you do not go there for the light. You go to Egypt to look at the pyramids, or something of that nature. When it gets dark you can easily go and have a martini—and that is a very sound thing to do. That is what you do. You do not say "Oh, it is light in Egypt, let's go there", or, "It's going to be light in Britain, let's go there". That is absurd. Indeed, the argument is preposterous but, unfortunately, because of the politeness of this House, I shall have to sit and listen to it during the debate.
I shall finish by talking about business. I do not wish to irritate the noble Lord, Lord Tanlaw, again. Having done it once, it would be improper to do it twice. When I look back at the record of our previous debate in the Official Report I am staggered to note the amounts of money which the noble Lord conjured out of the air. He referred to millions; in fact I believe he referred to billions, although they were dollars which made the figures higher than if they had been pounds. He claimed that billions could be gained by implementing this change.
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The CBI tells us that there is a two hour differential between business practice in London as compared with our overseas competitors. I have no doubt that that is true. If one considers that two hour differential, one discovers two facts. One hour is the time shift about which this Bill is concerned, but the other hour is due to the fact that our dynamic businessmen start work an hour later than their Continental competitors.
Let us assume for a moment that the billions referred to by the noble Lord, Lord Tanlaw, are correct. I have no idea whether that is the case, but one thing I do know is that during my 17 years in this House I have heard noble Lords suggest structural proposals such as the one we are discussing which they claim would result in this country gaining billions of pounds, but that has never happened. Over-optimism seems to be the basis of those calculations. But suppose the figures are correct and there is a two-hour differential, is it not a fact that half of that money could be earned if our dynamic businessmen got out of bed earlier and went to work to chase business in the way they tell us they are always doing? If that were so we would not have to bother about the matter.
As the noble Lord, Lord Tanlaw, says, this measure would be convenient for 700,000 people who are engaged in insurance and banking. However, the vast majority of those people are minions and it does not matter when they do their work. They constitute a small number of people. I believe he has chided me for saying they constitute a tiny number of people. They are important but we are talking about a small number of people who would stand to gain from the measure. There is no reason why a large number of people should be put to inconvenience to suit the convenience of a small number of people.
Let me finish because we do not want this debate to go on for too long. I sometimes wish it had started earlier and we could really have got into it. I leave noble Lords with a thought. As I said, the time variance across the globe is, to a large extent, a matter of east and west. Does it never cross the noble Viscount's mind that France is to the south of Britain, as are Spain and Portugal? Would it not be a better idea if his Bill did not ask us to adopt their time but rather asked them to adopt our time? I see that the noble Viscount looks stunned. I do not think that that is plausible, but it is a thought. The noble Viscount is proposing that we change to the wrong time whereas the other countries could join us.
Let me finish by giving advice to the Minister who is to reply to this debate. It is said that the Government have been considering this matter for a lengthy period of time. My advice is very simple: continue to consider it and consider it into infinity. I hope that the Bill is withdrawn.
9.18 p.m.
Lord Ezra: My Lords, it is always a pleasure to listen to the remarks of the noble Lord, Lord Howie of Troon. Of course those of us who have followed this subject knew exactly what he was going to say; it is just that he says it every time in such a vigorous and jovial manner.

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I must say he brought tears to my eyes when he mentioned the poor Glaswegian going to work in the dark. As far as I can work out, he does that now anyway. I do not quite see why we should especially cry if he had to do that for another 20 minutes.
Lord Howie of Troon: Three-quarters of an hour; play the game!
Lord Ezra: My Lords, I stand corrected. As I said, the noble Lord brought tears to my eyes when he mentioned the Glaswegian who would suffer three-quarters of an hour more darkness whereas, as was made clear in the summertime consultation document which was published as long ago as June 1989, there are innumerable advantages in changing this measure. The noble Viscount, Lord Montgomery, referred to those when he introduced his Bill so succinctly. As far as one can gauge, the general opinion is moving very much in that direction and in favour of the change. That change could be made almost painlessly. It is merely a question of changing the clock for two hours instead of one on a particular occasion.
What puzzles me in all of this is not so much the views of the majority but the continuing uncertainty in Government circles. The noble Viscount referred to the fact that we had been told in this House earlier this year that the Government were still considering the matter. On 30th October this year in another place it was stated that:
"Our policy on future summer time arrangements remains under review, including whether or not it would be right to move to central European time".—[Official Report, Commons, 30/10/95; col. 711
Therefore, up to 30th October the Government's position was that they were still considering the matter, no doubt much to the satisfaction of the noble Lord, Lord Howie of Troon.
As usual, one has to go to the press in order to find out what is really going on in government circles. According to The Times of 24th November 1995, which is slightly later than 30th October, the Home Office has not yet decided whether to back the Bill of Mr. John Butterfill, and the Treasury is known to support the change, as is the Department of Trade and Industry. It adds that a large number of businessmen are also prepared to do so.
Lord Howie of Troon: My Lords, I wonder whether the noble Lord can tell us what were the views of the Scottish Office.
Lord Ezra: My Lords, I am always ready to oblige. The article states:
"However, the Scottish Office is extremely resistant to the idea".
We knew that anyway.
I should like to ask the noble Lord who is to respond when the various government departments are going to get together to reach a unified view on this matter. We can see why the Department of Trade and Industry should be in support. I am delighted that for once the Treasury should be in support of something as positive as this proposal. Why is the Home Office so reluctant to go ahead with this idea, bearing in mind that
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according to the information in the Green Paper to which I referred there will be a reduction in crime because most crime is committed in the hours of evening darkness rather than morning darkness, and there will be a reduction in accidents and fatalities on the road and all the advantages to which the noble Viscount referred?
We need a little enlightenment as to the Government's thinking on this matter. The matter is continually debated. The arguments are advanced very firmly by a clear majority in favour, with a vocal but absent—the noble Lord has gone—minority opposed. We have now been through this process three or four times. Presumably they will also go through it in another place. Therefore, we should very much like some enlightenment from the Government tonight.
9.23 p.m.
Lord Tanlaw: My Lords, I am very pleased to be taking part in this debate, particularly as the noble Lord, Lord McIntosh of Haringey, seemed to doubt whether I should because on a previous occasion I had declared an interest as being a consultant to the British Horological Institute. I can inform the noble Lord that that is an honorary position. A number of other noble Lords also have that duty. I am not paid anything, but occasionally I award prizes.
Lord McIntosh of Haringey: My Lords, I am delighted to say to the noble Lord that I am sorry that I doubted that in any way. Of course, holding an honorary position, he is entitled to take part in the debate. Indeed, the debate is enriched by his contribution.
Lord Tanlaw: My Lords, it is very kind of the noble Lord to say so. In case other skeletons fall out of the cupboard, I can declare an interest. Twenty years ago my company was responsible for stopping and starting the great clock at Westminster, known wrongly as Big Ben. I also designed the timing devices that noble Lords have been using for the past 20 years. That may be unknown to your Lordships because I have never mentioned it before.
I should like to declare my interest because I wish to say that I know something about the subject. I am able to correct noble Lords such as the noble Lord, Lord Howie, by saying that the earth goes round the sun and not vice versa. That may be helpful in a debate on this subject, especially as we have covered the area a number of times before.
At this late hour I do not intend to repeat the facts and figures in what has now become almost an annual general meeting on the subject of Central European Time. The details can be found in past debates: the Unstarred Question of the noble Viscount, Lord Mountgarret, on 14th January 1994; the Summer Time Order debate on 18th October 1994; and the Central European Time Bill on 11th January of this year.
I have not changed the views expressed in those interventions, although I was hoping that this debate might give me an opportunity to withdraw a statement that I made when venturing briefly off script at col. 267

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of Hansard on 11 th January when I described the attitude of Her Majesty's Government and Her Majesty's Opposition parties towards harmonisation of the time standard with Central European Time as "pathetic". I used this somewhat unparliamentary epithet at the time to express my frustration, combined with many others outside Parliament, about the total lack of progress in this area. The current situation is no different, as this Second Reading debate of yet another Private Member's Bill implies; and I see no reason to withdraw my statement at this stage but merely to underline it.
I therefore repeat the question, as I have done on other occasions to noble Lords who sit on the Government Benches, as to why this important issue was not included in the Queen's Speech and was purposely left, as it has been on previous occasions, to a noble Lord's Private Member's Bill which has little or no chance of reaching the statute book through lack of support and time allocated to it in another place. Exactly the same is true for the other identical Private Member's Bill under the name of John Butterfill to which I shall refer later and which I suspect will suffer precisely the same fate as the noble Viscount's Bill.
I must also ask noble Lords on the Opposition Benches why, in so far as I am aware, they have not remarked on this important omission in the Queen's Speech; and why, in so far as I am aware, they have not included Central European Time as an essential plank in their pro-European policies. Can it be that there has been some collusion between the two main party managers in letting the issue of Central European Time once again fall by default? Does the forthcoming general election have any bearing on the matter? Is there not, therefore, a serious defect in our parliamentary system of government when an issue such as the time standard, which affects every man, woman and child in the country, is deliberately and consistently not allowed proper time for inclusion in the Queen's Speech or in the Opposition parties' manifestos?
I can think of no other issue where the gap between party political expediency and the reality of everyday life is greater. Why is it apparently so difficult for active politicians to address themselves to real events which take place outside the Palace of Westminster? In the past debates on the subject in your Lordships' House the Government and the Opposition Front Benches have consistently proclaimed that Central European Time is not a political issue. The noble Baroness, Lady Blatch, so stated at col. 198 of Hansard in winding up the debate on 18th October 1994.
If that is so, why cannot Members of both Houses of Parliament obtain the much-needed update on the inconclusive and outdated consultative document of 1989? Could it be that the latest evidence is being withheld from us because it will clearly indicate the necessity of harmonisation of the time standard with Central European Time?
Could it be that both Her Majesty's Government and the Opposition parties do not wish to admit to the electorate just before a general election that harmonisation will be on the statute books—just in case
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it affects voters at constituency level? I shall need a great deal of persuasion that the delay in addressing the issue by both main parties is not a "political issue". If it is not a political issue, is it some sort of party political fix?
By that I mean why has not more been done by both the Government and the Opposition parties to educate the electorate on this rather complicated subject? As there has been little or no enthusiasm to encourage a public discussion of the advantages or disadvantages of harmonisation with CET, is it surprising that there is an inevitable and natural hostility towards altering the status quo?
This is a genuine view which has been supported by some of my noble friends and other noble Lords in past debates, and no doubt they will do so in this debate. That in turn seems to reflect the national rather than rational attitudes in Scotland, combined with the misplaced patriotism of those who prefer to live in "little England" south of the Border. Whether those views have evolved out of ignorance of the true facts or simply by ignoring them, I do not pretend to know. But can anyone be in a position to say so until there has been a national referendum based on a trial period of actual harmonisation with Central European Time?
Perhaps noble Lords on the Opposition Benches can at least clarify part of the situation this evening. If they are in a position to deliver devolution for Scotland and Wales after the general election, can they say categorically that Standard British Time, regardless of whether it is harmonised with Central European Time, will continue to be controlled by Westminster and be applicable throughout the land, as it is now? Alternatively, will it become a devolved issue to be settled in Edinburgh or Cardiff, with the extraordinary possibilities and consequent anomalies that will be created by different English, Scottish and Welsh time standards? Have the party managers of the Opposition parties addressed themselves fully to the question? If so, what is their considered opinion?
I have read reports in the media on 24th November, thanks to our excellent Library service, about the good fortune of the Private Member's Bill of Mr. John Butterfill MP. It is identical to the noble Viscount's Bill in many ways, as I understand it. Apparently, the honourable gentleman will be allowed a free vote. But the chances of the Bill getting on to the statute book must surely be remote, unless the Government back it and insist on the support of the Scottish Office, which I understand is against the Bill. I ask the Minister to say whether the Government will support it. Can noble Lords on the Opposition Benches say whether the Scottish Opposition Members of Parliament will support the Bill as well on a free vote or will they vote against it? If they do support it, why then is harmonisation with Central European Time left to the chances of the ballot and not included in the Queen's Speech?
I suspect that the Butterfill Bill is no more and no less than an all-party delaying tactic. That is, unless the noble Earl who is to reply can persuade me otherwise, or noble Lords on the Opposition Benches.

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What is Her Majesty's Government's excuse for not supporting Central European Time? Is it simply due to lack of foresight or just dogged implementation of laissez-faire on all policies connected with Europe? I suspect that it could be the latter. Has it not taken more than 15 years since the initiation of the Channel Tunnel for a high speed rail link Bill to be included in a Queen's Speech?
Therefore, how much longer will it take the Government or, for that matter, the Opposition party, if it becomes the Government, to recognise that it is equally necessary to eliminate the time differential currently acting to the detriment of the travelling public and the business communities in the City of London? Will it be 10 years or 20 years? Perhaps the noble Earl who is to reply can give us a proper explanation as to why a number of leading international banks have suddenly decided to abandon the City of London as their traditional financial base for Europe and have moved instead to Frankfurt. Is the air so much purer there than the motor-polluted atmosphere of London? Possibly. Or is it because they can enjoy a full day's trading on the financial market without the time and travel restrictions imposed by British Standard Time which can reduce their daily trading turnover by as much as 30 per cent.?
I shall not go back to answering the noble Lord, Lord Howie, on the point. The statistics were not mine; they were taken from the CBI and various other organisations. Therefore, he may argue with them. The Confederation of British Industry has in the past submitted papers showing that its members are in favour of harmonisation with CET. It has done so again—in fact in the same papers as it sent out last time in supporting the noble Viscount's Bill. However, I regret that some of the more recent papers which have been circulated by the CBI to noble Lords on European travel seem to have excluded the issue of Central European Time. I think that that is a pity. It is a rather strange exclusion when the travel industry will gain approximately more than £1 billion per year if harmonisation were in place.
I wonder whether the CBI should not start to be more aggressive in its support for Central European Time by representing its members in Scotland and England more forcefully. Should it not try to bring politicians more up to date than we are at the moment with the real statistics that operate in the business world? I hope that the CBI will cease sitting on the fence, especially in Scotland. If the main political parties are not prepared—for what can only be party political reasons—to give a commitment one way or another on the subject, and if, for the same party political reasons, the electorate is not allowed an opportunity to express its views through a referendum, what can be done?
Will the noble Earl who is to reply not agree that there is now a case for doing two things? The first would be to get all-party agreement to instigate a trial period of harmonisation with Central European Time. It has been done before; what is wrong with doing it again? For surely it would allow proper statistics, particularly in regard to road safety and crime figures, to be gathered scientifically. Is that not more preferable than using the
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device of failed Private Members' Bills as an excuse for doing nothing? Secondly, would not an all-party agreement on a referendum be a correct basis for this controversial subject? The whole population would have experienced the effects of harmonisation with Central European Time in reality and would be in a position to judge it accordingly. Is that not a far more preferable and democratic input than the feeding out of doubtful, dated and possibly politically-biased statistics, which is what is happening now?
A referendum following a trial period would also scuttle once and for all the rather dubious arguments put forward by the Scottish NFU and the Scottish construction industry, which are against harmonisation with Central European Time. The NFU still seems to fail to recognise, first, that arable crops do not grow in winter but in spring, summer and autumn; and, secondly, that modern animal husbandry is undertaken mainly indoors in northern latitudes in a controlled environment. Animals left out on a hill do not feed until daylight and are quite oblivious as to the time on the face of the hill-farmer's clock.
The Scottish construction industry, on the other hand, makes what appears at first glance to be—I believe the noble Lord, Lord Howie, made this point on a number of occasions in the past—a good safety point against harmonisation with CET. Its owners indicate dangers to workers exposed to the elements on open scaffolding, as well as their having to ascend icy ladders in darkness during the winter months. But how is it that more modern construction industries in North America, Canada and Scandinavia can carry out their building work in far harsher winter conditions by protecting their workers in completely controlled environments?
Therefore, are not the poor conditions for workers described by the Scottish construction industry equivalent to those prevailing when boys were sent up to sweep chimneys in the time of Dickens? Should not these outdated practices be scrapped forthwith, regardless of whether the United Kingdom harmonises with Central European Time?
In conclusion, would not a trial period of Central European Time, followed by a national referendum based on experience throughout the United Kingdom, answer this question once and for all? The usual problem as to how referendum questions are to be posed fairly could be overcome by asking the electorate one very simple question: "After living in a trial period of CET, do you wish harmonisation with Central European Time to be permanent? Yes or no?".
Will the noble Earl who is to reply say what is wrong with this not entirely original suggestion, and why it was not put forward as a practical solution to this problem long before now? Will he say why he thinks that two identical Private Members' Bills, that originating in this House which is before us this evening and the other to be debated next month in the other place, will offer better solutions than the one I have proposed?
Lord Howie of Troon: My Lords, before the noble Lord sits down, I must say to him that I was not speaking for the Scottish construction industry. My

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"Scottish" comments referred to Scotland as a whole; my comments on the construction industry referred to construction throughout the country.
I want to ask the noble Lord a question. He speaks of harmonising with Central European Time. That is not quite the phrase used by the noble Viscount, but we know that it means the same thing. He will realise that what one might call central Europe has three time zones in it. There is ours, the middle bit and the part where the Greeks reside. Does he suggest that we could harmonise the whole of that part which we might for convenience call central Europe into one time zone, which would be—the noble Lord, Lord Monson, will correct me later if I am wrong—perhaps the widest single time zone in the world with the exception of China?
Lord Tanlaw: My Lords, I feel that a step-by-step approach would be the answer; but basically the answer is yes.
Lord Chesham: My Lords, in view of the hour, I wonder whether it might be possible to make the discussion slightly shorter?
9.40 p.m.
Viscount Mountgarret: My Lords, I am grateful for that intervention. The arguments have been very well rehearsed before, a year ago. There is very little further to say.
We are very grateful to my noble friend Lord Montgomery for reminding the Government yet again that it is the wish of your Lordships' House—at least it was its wish last January—that this whole matter should be discussed. It has gone on for a long time. A question paper was sent out and we have the view of many organisations. It is time that Parliament is invited to give a view. After all, that is the function of Parliament. It is there to lead and enact legislation. It does not necessarily dictate legislation, unless it is a matter of government policy, and on a issue of this kind, it is a matter for the feeling of Members of Parliament and your Lordships.
I should like to refer to the suggestion of the noble Lord, Lord Tanlaw, that there should be a referendum. I am most opposed to that. It would be quite improper and wrong. Members of a club do not elect a committee to run it and then everlastingly have the committee ask its members how they feel about some matter. Only on an issue of major national or constitutional importance, such as joining the ERM, having a single currency or something of that nature, may there be a justification for having a referendum; not for something like this matter. It is up to Parliament to decide.
Last year, I was very upset when your Lordships were kind enough to give my Bill a Second Reading but unfortunately the Government—it was not unconstitutional but surely it was a little less than polite—seemed totally to ignore it. That was not very polite. The noble Lord, Lord Howie, suggested in his speech and also in correspondence recently in The Times, that my Bill was utterly bizarre and that is why your Lordships gave it a Second Reading. I find that
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bizarre in itself. If I may say so, there is a certain amount of legislation which, with the benefit of hindsight, would have been called bizarre, anyway. I do not believe that that is a good enough excuse for the matter not to be discussed.
The main reason why my Bill was considered bizarre was that Scotland was left out of it. That is as may be. If the noble Lord, Lord Howie, had read my speech, he might have realised that I was happy for the Scots to be permitted to decide for themselves and consider opting into my Bill. However, my noble friend's Bill is now in front of us—I personally like its title much better than the title of my Bill because it is far more to the point—and it embraces Scotland. So all that is happening is that the Scots might be invited either to opt out of the Bill if they do not like it or to opt in to my Bill if they so wish. It is exactly the same thing but the other way around.
The noble Lord, Lord Howie, made some rather upsetting remarks, if I may say so. He said that it was bad enough going to work in the daylight. Some people actually enjoy their work. It is their life and what interests them. To suggest to them that it is bad to have to go to work even in the light is rather presumptuous. Many people who work outside think it is pretty awful to have to work in the dark, as they have to do in the winter months. Consideration should be given to them also.
The noble Lord went on to say that if businessmen, financiers, and so forth, want the same working hours as their counterparts in Europe, they should go to bed earlier so that they are fit enough to get up earlier. That is an appalling suggestion.
Lord Howie of Troon: My Lords, will the noble Viscount give way?
Viscount Mountgarret: My Lords, I shall not give way; I shall say why it is an appalling suggestion. Does not the noble Lord have a social life? If he had to go to bed earlier because he wanted to get up earlier, he would have to give dinner parties earlier.
Lord Howie of Troon: My Lords, I have been enjoying the noble Viscount's speech very much but cannot let it go on—I know the Chief Whip wants to get home and so do I. I did not say anything about when businessmen went to bed. I said that they should get up earlier to do their work. I do not care when they go to bed or indeed if they stay up all night.
Viscount Mountgarret: My Lords, I apologise if I misheard the noble Lord. But is he seriously suggesting that financiers, businessmen and the like should have to work a longer day than everyone else in order to satisfy the noble Lord's countrymen in the north of Scotland? That is a most selfish remark.
I do not know whether the noble Lord, Lord Howie, has been to Northern Ireland, as I have. I can assure him that though there is a difference in the light in winter, it is not substantially different from the light on the mainland. But the further north one goes—to Inverness or Fort William—then it is a longer night. It is not only

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the further west one goes, it is also the further north one goes that must be taken into account. The noble Lord's arguments therefore do not add up.
I like the title of the Bill and hope that my noble friend on the Front Bench will take the message back to his colleagues in the Government that if the Bill is passed, as I sincerely hope it will be, the Government must take on board the fact that the Bill of the honourable Member for Bournemouth West, if he introduces it, must be given time. I do not say that they should support it or oppose it. But it must be a free vote and the Government should provide time for it. In the meantime, I wish my noble friend's Bill fair speed and a safe homecoming.
9.48 p.m.
Lord St. John of Bletso: My Lords, although I wholeheartedly support this Bill, I must admit to being a beneficiary of the current status quo today, having left Russia at around 2 o'clock this afternoon for Copenhagen, and then taken an onward flight to London, arriving some five hours later at 5 o'clock.
Before giving my reasons for supporting the Bill, most of which were extensively debated during the course of the Second Reading of the Central European Bill moved by the noble Viscount, Lord Mountgarret, I wish to raise one simple issue, summarised on textline following the recent gracious Speech. It read,
"Later Tory Viscount Montgomery of Alamein introduced his backbench Western European Time Bill, seeking to bring Britain in line with the Continent. It stands no chance of becoming law without Government support".
Surely in light of the Government's Green Paper on this subject in 1989—mentioned also by the noble Lord, Lord Ezra—atid with the results of the National Opinion Poll in October last year showing such strong public support from throughout the United Kingdom, now must be the time for this issue to be given serious consideration by the Government and at least a free vote in the other place. I was very pleased to hear that the Butterfill Bill, as it is called, will receive a free vote in the other place. As I am the sixth speaker in the debate, the noble Viscount, Lord Montgomery of Alamein, will be interested to see that the score is now 5:1.
As noble Lords will be aware, there have been two experiments with adopting permanent summertime. One was during the Second World War to ensure that children could get home from school before the blackout and also to save energy in munitions factories. The other was the experiment between 1968 and 1971. I understand that one of the main reasons for the 1968 to 1971 experiment ending was that at the time the tabloid press took up the cause of objectors—mainly builders, farmers, postmen and, of
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course, the Scots. There was also a lot of slanted evidence with regard to statistics on child casualties from motor accidents in the mornings.
Lord Howie of Troons: My Lords, it was actually because a small group of children in, I think, Stornoway were massacred one morning in the dark. There was nothing slanted about it. They were dead.
Lord St. John of Bletso: My Lords, if the noble Lord looks at the statistics from the Transport Research Laboratory for that period he will soon realise that my figures are correct. There would be more casualties in the morning than in the afternoon if the experiment were to be tried again, which I hope, as the noble Lord, Lord Tanlaw, said, will be the case.
As a consultant to one of the stockbrokers in the City, I suppose I should be referring to myself as what the noble Lord, Lord Howie of Troon, mentioned when the issue was debated earlier in the year. He referred to,
"The noisy young men in red braces who transact the business in the City".—[Official Report, 11/1/95; col. 252.]
As a consultant, I am particularly concerned about the cost to British industry and commerce of resisting this legislation. I am sorry to pick on the noble Lord, Lord Howie, but he mentioned the time the average City yuppie, as I suppose one would call them, goes to work. The average time is eight o'clock in the morning, and for many eight o'clock is late. It should also be remembered that 58 per cent. of British exports go to European Union countries and that there would be, as the noble Lord, Lord Tanlaw, has already mentioned, almost a 20 per cent. increase in the daily turnover of foreign exchange and a similar increase in the insurance and stock markets as a result of an increase in trading hours with Europe. There would also be increased revenue from tourism. Those are all resounding fiscal reasons for supporting the Bill. I really ask what cogent reasons can the Government give to refute those statistics and refuse giving the legislation the go-ahead.
Mention has also been made in the past of the 1993 Policy Studies Institute conclusion that the move to harmonise British time with the rest of Europe would mean fewer road deaths and accidents, would reduce crime, would be a benefit to sport and tourism and would cut electricity bills by more than £250 million.
I wish to make two final points regarding children and the elderly. If the Bill is passed I believe that the major beneficiary will be the ability of many children to play sport in the longer afternoons, an issue which is very close to my heart. Children do not have nearly enough opportunity to play sport in the afternoons during the winter months. I am sure that the Bill would also be warmly welcomed by older people. I am not just referring to noble Lords but to the 9 million elderly people in Britain who have no need to rise early. Age Concern firmly believes that an extra hour of daylight in winter would enable millions of older people to travel, shop and socialise more easily, especially as many are worried about being mugged after dark. Both the Home Office and the Police Federation statistics suggest that the cover of darkness encourages greater

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criminal activity, more specifically, burglaries, assault and vehicle theft. A Guardian leader of 17th October was headed,
"Stop turning back the clock—And thereby boost tourism, save energy and cut crime".
Let us see action, possibly a trial period, rather than further procrastination by the Government.
9.55 p.m.
Baroness O'Cathain: My Lords, it is now absolutely apparent that there is considerable and wide-ranging support for a common European time zone, and a recognition that it is this country which is out of step with its Continental colleagues. The Bill which my noble friend Lord Mountgarret sought to introduce in January of this year is very similar to the Bill which we are now considering. But he omitted Scotland which, I suppose, on reflection, was probably not a very good idea.
I am glad to see that my noble friend Lord Montgomery makes no such exception. As I recall saying in January of this year, ours should in all senses remain a United Kingdom. I understand well that in Scotland, where winter days are short and the nights already feel very long and cold, there is more opposition than elsewhere in the United Kingdom to the prospect of the sun rising even later in the morning. But in Scotland, even more than in the rest of the country, there are surely commensurate benefits to an hour's more daylight in the afternoon. These have been touched on already. There have been signs that in Scotland there is growing appreciation of this. An NOP survey a year ago showed that Scottish opinion was not so firmly set against harmonising our time with Europe as had been thought previously. On the contrary, 62 per cent. of Scots surveyed said that they thought it was a good idea. As an aside, I really do fear for the noble Lord, Lord Howie of Troon. Those involved in selling Glasgow either as a business centre or as a tourist destination will hardly take kindly to the pretty awful description of dark, dank, cold Glasgow.
However, for those accustomed to rise at unearthly hours in the morning far north in Scotland, the idea of waiting a further hour for daylight might appear bleak indeed. As someone who is familiar with London's 5 a.m. darkness, I believe that I understand how they feel from time to time.
But, for heaven's sake, even now we all adapt our habits by an hour every summer and spring. We get an extra hour in bed or we lose an hour and what difference does it make? Harmonisation will not greatly change the adjustments that we now have to make. If in Scotland it creates particular problems we should find ways of helping to overcome them rather than simply saying, "It is all too difficult, so let us forget it".
I am sure that your Lordships need no reminding of the commercial benefits that an extra hour's afternoon daylight would bring. Business supports it; tourism needs it and Scotland more than anywhere else should really be conscious of that. There are overwhelming economic reasons for providing an extra hour of
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daylight in the afternoon when it can be used to best advantage, as the noble Lord, Lord St. John of Bletso, has just pointed out.
The sheer inconvenience of starting work later than our Continental colleagues, taking our lunchbreaks at different times from them, and calling them late in the afternoon to find that they have packed up for the day, will be all too familiar to anyone who does international business. Meetings on the Continent all too often involve the additional cost of hotel accommodation and the disruption of the previous day, simply in order to be there to make a 9 a.m. meeting, when we are constrained at this end by actually being unable to take off earlier on early flights because of noise restrictions.
Let us just pause for a moment and note how the Daylight Extra campaign, which has worked for several years to encourage the adoption of Central European Time, Single or Double Summertime, call it what you will, is not just supported by commerce. It is also supported by several large, reputable and national safety organisations such as RoSPA (the Royal Society for the Prevention of Accidents) the Child Accident Prevention Trust, the Suzy Lamplugh Trust and the Parliamentary Advisory Council for Transport Safety. I hardly believe that any of those need any introduction to your Lordships or require my recommendation to noble Lords. The Police Federation, too, supports the campaign and for very good reason. None of those organisations excludes Scotland from its support.
A friend of mine was a schoolgirl of 11 when the permanent summertime trial of 1968–71 started. She still remembers the road safety lessons that she attended to highlight the need for extra care, and still has the fluorescent armbands that were given to her and all her friends to wear over their dark winter gaberdine coats.
Yes, we must be responsible about such a move. We must ensure that the right support is given to all those who are affected and ensure that all children are well trained in the highway code. At present our children may make their way to school in daylight, but they return at dusk. Indeed, if they have extra curricular sports or drama interests which take place after school, they come home in the darkness. I am informed that three times as many children are injured in road accidents between the hours of 3 and 6 p.m. as between 7 and 10 a.m. I suspect also that children who are tired after their day at school and possibly distracted as they walk home with friends are more vulnerable than in the morning. It may be necessary to change the hours of the school day further north where daylight is generally in shorter supply, but I simply cannot understand the opposition to the principle of harmonisation.
However difficult this decision may appear to be, that is not a reason for failing to take it. We have spent many years and many parliamentary hours since 1971 avoiding any decision on this matter. It is time to make such a decision and we now have a double opportunity with a Bill in the other place and one here. We are unlikely to get such an advantageous situation again. Now is the time to make a sensible decision. I commend the noble Viscount's Bill.
10.1 p.m.
Lord Berkeley: My Lords, I should like first to declare an interest in Eurotunnel. I do not think that Eurotunnel has any strong views on Central European Time except that we believe that it is generally good for business. However, it does not have the same effect on our company as it would if we were running an airline or through trains. I have supported the Daylight Extra campaign for many years now in an unpaid capacity. I am supporting it today and hope that I may be of some assistance to Mr. John Butterfill and his Bill in another place. I congratulate the noble Viscount on introducing his Bill.
As we have all heard, this debate has been going on for 30 years and during the two world wars previously. This country achieved a single time zone only in late Victorian times with the coming of the railways. We have talked today about a "twin-track" approach so perhaps it is appropriate to say that, before that, this country had about 15 different time zones. I really cannot resist the thought that with rail privatisation comes the possibility of having 19 train operators in the future and that each may bring back its own time zone. We have talked about through ticketing at length in this place. Perhaps through journeys as well as through ticketing will become even more difficult and unreliable than at present if that happens. I hope that it does not. To me, Daylight Extra sums up what we are talking about. We are talking about more daylight in the afternoon and evening when most people need it.
I should like to concentrate in a little more detail on preventing road accidents, because I believe that that is the main, possibly the only, reason for supporting change. I should like to quote from the two reports of the Policy Studies Institute, which in turn drew heavily on studies conducted by the Transport and Road Research Laboratory, based on the accident statistics during the experimental double summertime period between 1968 and 1971. Projecting those figures forward to two years ago, it is estimated that the number of road fatalities in the UK would have been reduced by 140 per annum and that the number of serious injuries would have fallen by 520 per annum. The basis for that is that more accidents occur in darkness—I think that we can understand that—than in daylight. As we have heard, children make one journey to school in the morning but they may make several journeys after school for sport and leisure or to see friends. Therefore, they are much more exposed to traffic after school than before.
The report states that only 11 per cent. of child fatalities occur on school journeys. That confirms what I have just said. As we have also heard, in the afternoon children and other people tend to become more tired and less attentive. So it follows that, if time after school is in daylight, there will be many fewer accidents, although against that there will be a small increase in the number of accidents in the morning. There will be 140 fewer fatalities per annum in the UK if we change to Daylight Extra.
Perhaps I may turn to Scotland now. I am wary of saying too much and beating the competition for interventions by the noble Lord, Lord Howie of Troon,
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but I will try. The problem in Scotland is that there is not much daylight around in the winter—six hours a day, I believe. I am an engineer like the noble Lord, Lord Howie, and in the late 1960s I spent two years working on a construction site just west of Glasgow. The problem was that the men wanted to be paid for at least eight hours a day, if not 10, and there was only six hours of daylight.
We managed to pour concrete by making the concrete with hot water and other things. We introduced this extraordinary idea of electric light on a construction site, which meant that we could work in the darkness. It did not matter if the electric light came on in the morning or the evening. In fact it was so dim and dull on some days that we had the lights on all day. The other thing I found in Scotland was that between about 20th December and somewhere near the middle of January, not a great deal of work went on anyway. Something called Hogmanay took place. So I do not really believe that the construction industry lost a great deal of time during that period when it is darkest. It could put on the lights and put up scaffolding boards to stop people falling off the scaffolding, and people could get on with their work like everyone else does.
I shall deal briefly with road safety in Scotland. It is interesting that there is lower vehicle ownership than in England and Wales but proportionately there are more road fatalities and injuries. This, it is said, is because more people walk. I assume that that is a good thing. Using the same arguments in Scotland, there is more to be gained in the road accident business by the change to Daylight Extra. The report estimates that Daylight Extra would cause an annual reduction of about 60 deaths and serious injuries in Scotland.
I do not know what the Scottish Office is doing with all these statistics. Perhaps we can hear from the Government later whether they are about to produce a report rubbishing what the Transport and Road Research Laboratory has produced. However, I hope that they will not, because that will get us into an English/Scottish debate, which would be pretty unhelpful.
In conclusion, the reduction in road accidents (140 fatalities a year) is the strongest argument for changing to Daylight Extra. It will not cost the taxpayer a penny. Perhaps that is why the Treasury is not opposing the proposal. Statistics and forecasts do not have faces attached to them, but there will be 140 faces attached to those fatalities—people who have died unnecessarily this year, next year and so on until we change. I strongly support the Bill.
10.3 p.m.
Lord Craigmyle: My Lords, a great deal of learning has been shown and a great many statistics quoted, some of which can probably be challenged, although I do not know, because I am not in the business of challenging statistics. No one seems to have got down to the basic principle of the matter: clocks are there to tell the time of day, and one expects the clock to tell the time of day where that clock happens to be. That is just the thing which the Bill will abolish.

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When our clocks strike 12 in the summer under BST—if the Bill is adopted it will not be the summer only, it will be the winter—it will not be midnight or midday here in Britain, but in Bohemia. Again, if the Bill is adopted, in the summer when the clock strikes 12 we are supposed to imagine that it is midday. Will it be midday? Not a bit of it, it will be midday in St. Petersburg. One may for convenience abandon reality to a certain extent but certainly not to the extent of 30 degrees longitude. That is overdoing things.
Does it matter? Can we not all go about doing our own things in our own time and not be ruled by clock time? Yes, we can, but that defeats the purpose of the Bill, which is to urge us to do things not at what we have come to regard as standard time but an hour or two earlier than we want to.
That kind of ploy works for a time. It worked with double summer time in the Second World War. But it works only for a short time. In the longer run, people will do things when they feel like it and when it is natural for them to do so, because people have in-built body clocks just like animals. We have not heard much about animals tonight; they are usually spoken of a lot in these debates.
If the official clock time disagrees too greatly with our body clock we are increasingly inclined to ignore the official clocks and heed our body clocks. We are seeing that phenomenon already in the increasingly late hours being kept on the Continent. I am told that in, for example, Madrid the streets, cafés and restaurants are thronged with people well after midnight. I suspect that the people of Madrid like to be in their beds by midnight as much as most of us but that, by midnight, their bodies mean midnight in Madrid and not midnight in Cairo. Cairo is an awfully long way east of Madrid. So the apparently late hours of the people of Madrid are the consequence of having the clocks two hours away from reality.
We in this country have succeeded at least in part in keeping to natural time in winter. As the noble Lord, Lord Howie of Troon, observed, we mere offshore islanders have kept a better tradition. Why is it that we with the better tradition propose to desert it and go for the less sound tradition of our continental neighbours?
I am all in favour of having the same time zone but let it be a sensible time zone based upon reality and not merely for the sake of neighbourliness having Ljubljana time in the winter and Istanbul time in the summer.
One radical solution occurred to me only last night. I could not help laughing at myself because I thought that it was too daft. Then I began to wonder whether it was as daft as all that. Could we not do as all air navigators do; that is, to reduce everywhere all over the world to one time zone? Could we not have all the clocks throughout the world indicating the same time and everyone in different areas working their way around those clock times? It seems a sensible answer but I admit that it is radical and would require international agreement. I believe that clock time should be real time wherever possible. To get away from reality is artificial.
10.14 p.m.
Lord Monson: My Lords, I am pleased to follow the noble Lord, Lord Craigmyle. I agree with much of what he said. The noble Viscount, Lord Montgomery, is following in the well-trodden footsteps of his noble colleague, the noble Viscount, Lord Mountgarret. However, my noble friend, as he is in reality outside the four walls of this Chamber, has been cleverer in choosing the Short Title for this Bill. "Western European", with its connotations of plucky democracies standing firm against communist imperialism, is more user friendly than "Central European", with its traditionally murky connotations.
However, a time zone by any other name smells no sweeter. I must remind the noble Viscount that he is still proposing that we should harmonise our clocks with those of Berlin, Warsaw, Prague, Vienna, Bratislava, Budapest, Belgrade, Banja Luka, Sarajevo and so on—none of them exactly western European. Yes, of course, Paris, Rome and Madrid are also included. But the point is that the geographical centre of the time zone which the noble Viscount wishes us to join would appear to be Leipzig, and I do not think that Leipzig is exactly in western Europe.
The alleged benefits of the Bill for road safety, tourism and so on are speculative and unproven. My noble friend Lord Berkeley cited the statistics emanating from the experiment in 1968 to 1971 from which projections have been made as to what might happen today if that experiment had been continued. But I must remind my noble friend that it was during that period that the 70 mile-an-hour maximum speed limit and the breathalyser were introduced. Therefore, it is quite possible that those projections are based on a false assumption. I would only repeat that if daylight in the afternoon were really safer than daylight in the morning, then East Germany, Poland, Austria and so on would surely have switched to Eastern European Time decades ago.
As always, the business case has been pleaded. But American, Canadian and Australian businessmen are astonished at the apparent wimpishness of their European counterparts who moan at minor time differences that they—by which I mean the New World businessmen—take in their stride. There was an interesting letter in the Financial Times to that effect about a fortnight ago.
The noble Viscount, Lord Montgomery, is certainly the greatest expert on Latin America in your Lordships' House. He will, therefore, know that Latin America has four time zones; North America has eight; Australia has three; and the Russian Federation has no fewer than 11, all embracing, on average, approximately 15 degrees of longitude. Los Angeles lies 34 degrees west of Atlanta, Georgia, and is on approximately the same latitude. There is a three-hour time difference between the two, so that when it is 9 a.m. in Atlanta it is 6 a.m. in Los Angeles.
Significantly, Tralee in County Kerry also lies approximately 34 degrees west of another place, Brest Litovsk on the Polish/Russian border, and is also on approximately the same latitude. Yet if the Bill goes

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through, both would be in the same time zone, even though the sun will rise in Tralee two hours and 17 minutes later than it will in Brest Litovsk. Yes, I know that Tralee is in the Republic of Ireland and not in the North, but if the North changes, the South is bound to follow suit before long.
The examples which most supporters of the Bill are unwittingly copying—and which my noble friend Lord Tanlaw, judging by his answer to the noble Lord, Lord Howie of Troon, is consciously copying—is that of communist China, where there is one single time zone spanning 61 degrees of longitude, so that if the sun rises at 8 a.m. in the east near Vladivostok, on the North Korean border, it will rise at 12 noon in the west near the border with Tadzhikistan. I would respectfully suggest to the noble Viscount that the Americans, the Canadians, the Australians and even his Latin American friends are better mentors than Chinese communists.
10.18 p.m.
Lord Mountevans: My Lords, I am delighted to support the Bill which would, if enacted, have significant benefits for the tourism and transport industries. In both those industries I do, as ever, declare an interest. My former colleagues in the British Tourist Authority support the Bill. They welcome the calculation of the Policy Studies Institute that enactment would add another £1 billion of spend to what is already a £36 billion per annum industry. A £1 billion increase in revenue would directly lead to an additional £100 million in Treasury, VAT and excise receipts. It would also lead, indirectly, to significantly new employment opportunities. Further, it would make our tourism product much more user friendly. Perhaps here I could pick up the idea of the noble Lord, Lord Howie of Troon, about not going to Egypt for the light. It could be argued that no one goes to Lapland at this time of year for the light either, and yet it is difficult to get a charter flight to Lapland at this moment in time.
Let me pursue that a little. The user friendliness would derive from the fact that many of our tourism attractions do not open before 10 in the morning and, particularly in the winter, they shut at dusk. At 10 in the morning the average recreational traveller is still taking life easy. That is part of what a holiday is all about. What he wants is to be active in the afternoons. Therefore, if we moved the daylight—we are not getting extra daylight, we are simply moving it—to some extent the traveller would have greater leisure opportunities which must be good for the many attractions which face the problems of the long winter evenings.
I believe that following the route proposed in this Bill would have advantages for Scotland because Scottish tourism to a certain extent finds itself in a vicious circle. As the noble Lord, Lord Howie, admitted to me earlier, tourists do not go to Scotland much after September because many of the attractions are shut for reasons that I have already explained. Why are many of the attractions shut? They are shut because tourists do not go to Scotland in October. If we stretched the day a little
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and delayed the daylight a little, perhaps we could stretch the Scottish tourist season, and in particular the short break business which is important to that industry.
I also believe that transport would be a major beneficiary if we were to go down the route proposed in this Bill. Every carrier—maritime, air, the Tunnel—has problems in terms of having to run different timetables at different times of the year, but in particular—it has more or less disappeared now—because of the one hour difference. Eurostar still gets many Continental visitors turning up at Waterloo an hour early for a departing train. Many British visitors turn up an hour late, or even just 10 minutes late—there are recorded cases of Members of another place suffering from that—because, again, they have not quite absorbed the time difference.
I believe that the aviation carriers, the ferry companies, the Tunnel, and the passenger and freight operators through the Tunnel, would find that going into the European time zone would have a major benefit in terms of operations and, likewise, in terms of user friendliness. Of course there would be a safety element because whenever one changes the timetable, one leaves oneself at risk from a safety point of view.
As regards our railways, the scheduling of Channel Tunnel passenger and freight services, not to mention their integration with the domestic network which they still use, would be greatly simplified. A bonus would be the fact that international passenger services would conflict less with London's morning peak, whether that be a matter of arriving passengers at Waterloo, or perhaps one day, St. Pancras. Furthermore, the longer evenings would encourage leisure travel which must be good for the railways. Passenger perceptions of personal security would be improved and I gather from the British Transport Police that the change would lead to a reduction in crime.
In making my final point I take on board my noble friend's wish for us to be brief. At the outset I should say that this is an expression of experience and not an attack on the noble Lord, Lord Howie of Troon. Today in Tromso in arctic Norway the sun has set, not to rise again for some two months. Tromso schoolchildren will still go to school safely; motorists will still drive; pedestrians will still walk or ski; ships, planes and the construction industry will continue to function, as they must. If the Norwegians can cope with so much longer periods of darkness, let alone so much greater cold, surely our innovative Scottish friends can cope too. Rather than let them rule our councils, we should, indeed we must, push on with this Bill.
Lord Monson: My Lords, before the noble Lord, Lord Mountevans, sits down, does he agree that the tourist industry would benefit almost as much if Europe-wide agreement could be reached to start summertime in mid-March so that Easter always fell during summertime, and end summertime on the first Sunday in November when the weather is still pretty good in most European countries?
Lord Mountevans: My Lords, it is my understanding that we are working in that direction.
10.24 p.m.
Lord HolmPatrick: My Lords, I am grateful to my noble friend Lord Montgomery for introducing this Bill to the House.
Getting up early in the morning for many years and saddling up a pony to find a few sheep in the hills or getting into a freezing cold lorry to fetch some gravel from a quarry has led me to conclude that getting up in the dark knowing that daylight is just on its way is infinitely more pleasurable than the frustration of working on in fading light into total darkness.
I still get up early, to do the school run. By the time my son and I are suitably dressed in our motor cycle attire it is broad daylight, and we proceed to school at our leisure. On the way we meet school buses which have set out before us, and as they stop to drop off their charges we overtake with care knowing that one or more children may appear suddenly in our path. But that is not a problem because we are prepared and we can see the children because it is broad daylight.
The scene of road safety awareness I describe to your Lordships applies to all motorists. It is particularly relevant to drivers of heavy transport who are likely to be around in great numbers at that time of the morning. Good visibility is essential.
Under the present arrangement for winter time the light is fading at 4 o'clock in the afternoon, and the good visibility that we enjoy in the morning is not available in the afternoon to proceed with care. The risks are increased when our children are coming home. By 5 o'clock it is dark, and pedestrians on their way home are at risk. Motorists will know that people coming home from work tired and lacking concentration do not always use pedestrian crossings and observe the lights as they should.
We have adopted metrication, not without some grumbling. Would not coming into line with Western European Time reduce some of our commercial headaches?
Finally, if we accept that Western European Time would give us an extra available hour of daylight in the evening and not deprive us of daylight in the morning at the crucial times I have indicated, does that not mean that an extra hour of daylight on winter evenings would greatly increase the health, safety and leisure of our children and reduce the number of accidents on the road?
10.26 p.m.
Lord McIntosh of Haringey: My Lords, I am sorry to disappoint the noble Lord, Lord Tanlaw, but I shall express a personal view rather than the view of my party. When the noble Lord came to this House he was a member of a political party. Now that he has the luxury of being on the Cross-Benches he is free to criticise those of us who have other considerations to take into account, regardless of party.
I support the Bill, and I wish that my party supported the Bill. I do not expect that most of my colleagues will disagree with me, but they will speak, as I do, on a personal basis, both here and in another place.
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There has been a certain amount of talk about the history of the matter, but no one has put it as well as my noble friend Lord Howie of Troon on the previous occasions when he urged the Government to continue procrastinating. That is certainly what has happened up until now. There was the experiment of 1968 to 1971. For what appeared to me to be inadequate reasons, that experiment was abandoned. Since that time there has been a fair amount of consultation and research, none of it as rigorous as I would have wished, all of which seems to lead to similar conclusions.
I shall not rehearse the arguments about road safety or sport and leisure, or indeed about business, although when we talk about the time that our business people are in contact with people in other countries surely it is far more important to be in contact for more of the day with Europe than it is to be an hour further away from New York, as we would be, or an hour closer to Tokyo, as we would be if the time were changed as proposed in the Bill. There are no doubt also arguments on the basis of energy, pollution and crime, and arguments for agriculture and construction.
However, we ought to come down to fundamentals about daylight and night time. Nothing in the Bill will increase the amount of daylight by one minute or one second. The sun will rise and set at the same time as now occurs and that will be different in different places. So none of this measure saves daylight in the absolute sense. What is true is that instead of having an infinitely adaptable series of time zones—I rather like the idea of the noble Lord, Lord Craigmyle, of having the same name for time throughout the world, but what happens when you reach the international dateline on his system?—with crude time zones set by every 60 minutes there will be 24 time zones around the world and light and darkness will be different at the edges of those time zones. That is a fact of life; and one cannot get round it.
Noble Lords have been speaking a great deal about midwinter and midsummer. However, our seasons, like our time zones, are a continuum. They are not the extremes. If it is darker in midwinter in the morning in any country, it will be lighter at midwinter and as spring and autumn proceed one will progressively gain or lose daylight. That, again, has nothing to do with how we keep our clocks or how we define our time zones.
I take it that none of us proposes to go back to the time before Bradshaw when you could take a train from Paddington and find differing times at Didcot, Oxford and Gloucester. I understand that Gloucester kept its own time for very much longer than anyone else.
No, my Lords, we shall not increase the amount of daylight. If we put ourselves more in the centre of a time zone, we can increase the amount of useful daylight. By useful daylight, I mean the time in which it is light and during which we are awake. The fact is that for most people in this country a very considerable amount of daylight through spring, summer and autumn is wasted in the morning before most of us get up. That is wasted daylight. If we change our time as the noble Viscount, Lord Montgomery, proposes, we should increase the hours of useful daylight. That is the best that we can do. I hope that we shall do so.
10.32 p.m.
The Earl of Courtown: My Lords, I congratulate my noble friend on his success in introducing a Bill on this subject. As we know from last year when my noble friend Lord Mountgarret introduced a similar Bill, the question of time zones continues to exercise the minds of many in this House and always produces a vigorous expression of views. The debate this evening has once again demonstrated the strength of opinion felt on both sides of the argument. I must apologise for the absence of my noble friend Lady Blatch on this occasion. She sends her sincere apologies for not being here this evening but she is addressing the annual general meeting of the Society of Voluntary Associates.
This is a Private Bill and the Government will not be opposing it. In the debate this evening many relevant questions have been raised and they have been answered in various ways. Your Lordships have heard most of the arguments before and I do not propose to run through them all again now, but there are a few comments I should like to make.
What my noble friend's Bill seeks to achieve is to move the United Kingdom from its present time zone to what is variously termed Central European Time, Single/Double Summer Time or now Western European Time. Whatever terminology we use, the effect would be to change from a system of GMT in the winter months and GMT plus one hour in the summer to GMT plus one in the winter and GMT plus two in the summer. I was grateful for the clear explanation by the noble Lord, Lord McIntosh of Haringey.
If I may, for the purpose of my comments this evening I shall refer to Single/Double Summer Time, or SDST, since this is the terminology used by the Government on previous occasions, although I understand why my noble friend Lord Montgomery has chosen this title.
The Government recognise that there are many who share my noble friend's opinion that the United Kingdom would derive great benefit from being in the same time zone as many other countries in continental Europe, both members and non-members of the European Union. However, it is only right to point out that there remain others in this House—and I note the words of the noble Lord, Lord Howie—and in the country at large who feel equally strongly that such a change would have significant disadvantages and that we are perfectly well served by the status quo.
From the correspondence which Ministers receive, it is clear that my noble friend is not alone in wishing to see a decision reached, although the various correspondents differ as to the conclusion they are looking for. Nevertheless, I have to say to your Lordships that nothing has changed in the past year to alter the Government's stance. We remain to be convinced that the time is ripe to conclude our deliberations.
We continue to listen to representations. For example, my noble friend Lady Blatch met representatives of the Parliamentary Advisory Council for Transport Safety earlier this year. Your Lordships may wish to know that, despite the obvious interest in
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this House and the reference by my noble friend Lord Montgomery to a groundswell of opinion, the volume of ministerial correspondence on this topic is not large. There was a recent flurry of letters after the clocks were changed in October, but otherwise, since our last debate on this matter, the volume of letters has declined to only four or five a month.
There has been no recent large-scale test of public opinion on a proposed change to our time zone, but we are often told, as we have been told today by my noble friend Lord Montgomery, that public opinion is largely in favour of such a change. Whether or not this is so, the Government have a duty to consider wider issues than public opinion alone.
Lord McIntosh of Haringey: My Lords, will the noble Earl allow me to intervene? It is all very well to say that the Government have the duty to consider wider issues than public opinion, but surely they should do so having first found out what that public opinion is. Is there not an obligation on the Government to carry out some effective opinion poll on the views of ordinary people? At the moment, the statistics we have are about consultation, which is vastly inferior to proper social research.
The Earl of Courtown: My Lords, noble Lords will find that later in my speech there is something which will cover the point. If that is not the case, I shall no doubt write to the noble Lord.
We have heard today from my noble friend Lady O'Cathain, who referred to a 62 per cent. majority in favour of change in Scotland in last year's NOP survey. I must remind your Lordships that the survey result was based on just 92 persons interviewed in Scotland.
The Government have a duty to consider all the arguments on an issue which affects everyone living in this country. That is what we have been doing and I will undertake to bring the points made in the debate to the attention of my noble friend Lady Blatch.
We have heard what has been said by my noble friend Lord HolmPatrick and the noble Lords, Lord Berkeley, Lord Ezra and Lord St. John of Bletso, about road traffic accidents and the advantages of travelling home at the end of the day in daylight. The House is familiar with the estimates of the Transport Research Laboratory on the net savings in road traffic casualties which might result from moving the clocks forward by an hour, although the noble Lord, Lord Monson, suggested some reasons which might not have been taken into account in the calculations.
On the other hand, we know that there are some contrary concerns about the safety of certain groups of workers, for example, postal workers and those in the farming and construction industries, as the noble Lord, Lord Howie, set out for us. Their spokesmen believe that the increased risk of accidents could be considerable. It may be that some individuals could adjust their working day to take account of darker mornings if those prove dangerous, but it is difficult to alter such arrangements unilaterally. I note with interest what the noble Lord, Lord Tanlaw, had to say regarding the construction industry.

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Another important consideration for the Government is the possible effect on crime of any change in the spread of daylight. It is clear that elderly people and women of all ages are anxious about being out alone after dark. Fear of crime is a serious problem and one which needs to be addressed on a wide front. Well-lit streets, concerned neighbours and better public awareness of the real dangers and how to avoid them can make a major contribution to reducing fear, but the extension of daylight by one hour in the evening could also help.
Fear of crime is, of course, an important element in people's sense of well-being. However, according to recent studies of crime patterns, the potential effects on the incidence of crime of a move to SDST are less clear than was suggested by the noble Lord, Lord St John of Bletso. Lighter evenings could reduce the number of thefts of or from cars, which take place more often in the dark. On the other hand, if longer evenings result in more people going out and leaving their house empty for longer, burglary rates could actually rise. Similarly, if lighter evenings encourage more people to go out, stay out later, and possibly drink more, then the number of assaults could increase. Changes in behaviour—in particular that of offenders—are difficult to predict, so that the net effect on crime figures is uncertain.
We heard from my noble friends Lady O'Cathain and Lord Mountevans, and the noble Lords, Lord St. John of Bletso and Lord McIntosh of Haringey, about the potential benefits of the proposed change for industry, tourism and transport. The noble Lord, Lord Mountevans, was indeed persuasive about the advantages for tourism, even in Scotland.
However, on the transport side, the most serious difficulty for the transport industry in recent years has not been adjusting timetables to different time zones in the UK and Europe—this, after all, is not a new problem or one that is confined to Europe—but rather the different dates hitherto adopted for the end of summer time. The industry has therefore welcomed the news that this year was the last one in which the periods of summer time will vary. Those noble Lords who are concerned that we may be too ready to harmonise our arrangements with others in Europe will be pleased to note that from next year our European partners are to harmonise with us. They have recognised the benefits of UK practice, and from 1996 will end summer time on the last Sunday in October.
While timetables might be further simplified if we were in the same time zone as much of Europe, as the noble Lord, Lord Mountevans, suggested, it has become apparent that this would also create some significant new problems for UK airlines. They would need to renegotiate their take-off and landing rights at many European and international airports and could also face difficulties in this country if the effect was to increase the number of night flights.
Business travellers are used to adjusting their watches when they travel, whether between the UK and Europe or, for example, crossing the United States, where this is not seen as a problem. The noble Lord, Lord Monson, also pointed out the multiple time zones in Russia and
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elsewhere. Noble Lords may also wish to note that even within the European Union we are not alone in having a different time zone. The Republic of Ireland is, of course, at the same time as us; but two other members, Greece and the new member, Finland, occupy a different time zone, being two and three hours ahead of GMT in the winter and summer respectively.
The adoption of SDST would indeed bring the working hours of the United Kingdom more closely into line with those of our major trading partners in Continental Europe, as was mentioned by my noble friend Lady O'Cathain. It would at the same time deprive business of the one-hour overlap with the working day in North America. For much of international business, however, neither of these considerations is any longer important. In a global market, business and financial centres are open around the clock. Methods of communication are becoming faster and more flexible. Working hours in the City of London have for some time extended both earlier and later than in the past—as was referred to by the noble Lord, Lord St. John of Bletso—to link up with the Far East in the morning and North America in the evening.
We have heard from those in favour of change about its advantages. Defenders of the status quo point both to some specific disadvantages which would flow from the adoption of SDST and to the need for strong and compelling reasons to justify altering a system with which everyone is entirely familiar. As the Government made clear on the last occasion—and in this regard I agree with the noble Lord, Lord Howie of Troon—whatever decision is eventually reached must take into account the balance of advantage for different regions and groups in the country and must be applied to the United Kingdom as a whole.
I assure the noble Lord, Lord Tanlaw, that the Government have no intention to support separate time zones within the United Kingdom.
The Government would, of course, bring forward a Bill if and when they considered it right to do so. It will be clear from my earlier remarks, and indeed from the differing views expressed so emphatically in tonight's debate, that we do not think that the time has yet arrived. As to one report in The Times—
Lord Tanlaw: My Lords, I thank the noble Earl for giving way. Perhaps he will clarify one point, if he can. I asked whether the Government would consider a trial period continuing with Central European Time in order to obtain the statistics which the noble Lord, Lord McIntosh of Haringey, suggested. I hope that he will make some remark about that or give some consideration to that suggestion.
The Earl of Courtown: My Lords, I believe that I have some notes relating to that matter. My right honourable friend the Home Secretary co-ordinates policy on these matters and these are the only authoritative statements of policy made by or on behalf of the Government as a whole.
As to the Butterfill Bill, the noble Lord, Lord Tanlaw, asked what the Government's attitude would be. I remind him that the proposed Bill has yet to be

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introduced. If it is, the Government will make their views known at the proper time. In any event it will be a matter for the other place.
My noble friend Lord Mountgarret raised the question of a free vote on Mr Butterfill's proposed Bill. I must point out that it is not the practice of the Government to make an announcement on procedure before the introduction of a Bill.
The noble Lords, Lord Tanlaw and Lord St. John of Bletso, asked why there had been no updated version of our 1989 Green Paper on the pros and cons of the various options. We have not received any such request, but I shall certainly invite my colleagues to consider the case for providing one.
Lord Tanlaw: I thank the noble Earl for giving way again. I raised this matter the last time that we debated the subject and asked why that consultative document was so out of date. So did many other noble Lords. I do not quite understand why he says that there has been no request made for it in your Lordships' House.
The Earl of Courtown: My Lords, I shall bring the views of the noble Lord to the attention of my noble friend Lady Blatch in due course.
We shall consider the suggestion of the noble Lord, Lord Tanlaw, about all-party agreement to an experiment, as we shall consider all suggestions. But it is not immediately evident that this is a party political matter suited to such an agreement.
The noble Lord, Lord Tanlaw, asked whether major banks have not moved to Frankfurt because of the present differences in time zones. I am not in a position to answer for the commercial decisions of individual banks. I imagine that such moves may have had to do not with time zones but with the fact that Frankfurt could be the home of a Central European Bank.
As to the suggestion of the noble Lord that there might be a referendum possibly following an experiment, your Lordships will know that successive governments have seen serious difficulties in reconciling the character of referendums with the proper functioning and authority of Parliament. That point was made with persuasive force, if I may say so, by my noble friend Lord Mountgarret.
As I said at the outset, no material change has occurred since your Lordships last debated the matter in January this year. I note that the Opposition have not altered their stance either, as was said by the noble Lord, Lord McIntosh of Haringey.
My noble friend Lady Trumpington remarked on that occasion that the Government do not look for an easy answer. I say to your Lordships now that the Government look for the right answer for the country as a whole. At that point I shall ensure that my noble friend Lady Trumpington receives a copy of Hansard to be able to note the kind words of her noble friend.
We continue to listen to representations. I have been listening carefully this evening and the Government will take note of all the arguments presented by your
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Lordships during the proceedings of this Bill. The Government have not shut the door on change. It remains our position that we do not believe that now is the time to bring our deliberations to an end.
Viscount Montgomery of Alamein: My Lords, I must first thank all noble Lords who have participated in this debate. It has been extremely interesting and much more wide ranging than I expected. A number of different views have been expressed. I find myself with the great temptation to wish to continue the argument with the noble Lord, Lord Howie of Troon, whose knowledge of geography is somewhat eccentric, if not deplorable. But owing to the lateness of the hour, I shall not do so. That would extend matters. Anyway, some of the arguments that he produced were refuted very effectively by the noble Lords, Lord Berkeley and Lord Mountevans. I look forward to continuing the debate with my good friend, if he is not my noble friend, outside in another environment. That will be a great pleasure.
As I count the score, until we came to the Government it was 10 speeches in favour and three against. That is quite encouraging. But I must admit that the reply from my noble friend on the Front Bench was disappointing to say the least. I had hoped that in the intervening period we might have moved this cause forward and the Government would be prepared to take some kind of decision.
What was slightly surprising in one of the comments made by my noble friend was the mention of the number of letters that Ministers receive on this subject. It would be quite easy to organise "Rent-a-letter"—it has happened before—and then he could have as many letters as he liked on these subjects. But that is not the point. We are trying to achieve a quality argument, and that is what was displayed in this evening's debate. A number of ideas were suggested and I believe that the matter has been moved forward because this Bill has found more favour than that so cogently argued by my noble friend Lord Mountgarret earlier in the year.
I feel that we must continue with this Bill because, if it is passed in this House, it will go to another place and there will be an opportunity to discuss two Bills. As I said earlier, there is to be a twin-track approach, with this Bill as it is presently couched and another Bill couched in any way that the Member for Bournemouth decides. As my noble friend on the Front Bench said, that is not yet known. How it will be dealt with by the Government in another place remains to be seen. But at least we shall have a shot at the bird with both barrels, and that may be better than hitherto.
I hope therefore to conclude this matter today. I thank all noble Lords for their participation. I commend the Bill to the House and ask your Lordships to approve its Second Reading.
On Question, Bill read a second time, and committed to a Committee of the Whole House.
House adjourned at nine minutes before eleven o'clock.

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