Sitting of 31 January 1996

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

Medical Misconduct
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Burns.]
9.34 am
Dame Jill Knight: It is now 10 years since a constituency case alerted me to the need for changes in the way in which doctors are dealt with in cases of suspension for alleged medical misconduct. Since then, I have raised the issue three or four times in the House. Action has been taken, although, as I shall seek to demonstrate, regrettably it has not solved the problem.
A lady came to my constituency surgery. She was gentle, apologetic, nervous and tearful. She was clearly stressed and told me that her husband was a consultant anaesthetist at the Queen Elizabeth hospital. He had been suspended and accused of medical negligence. She was upset because he was being paid his full salary, but was sitting at home and doing absolutely nothing; he was not allowed to do anything. She said that he was clearly upset because he had no wish to take money that he was not earning. On the other hand, bills had to be paid. It was not possible not to take the money, but it upset both of them greatly. That situation had been going on for 18 months.
I wrote to the health authority about the case and received a guarded response. I wrote again, and another year went by. Eventually, at the end of all that, he was found to be innocent of all charges. Meanwhile, his wife had died.
That doctor was most unjustly and wrongly treated, and his case is not unique. Other doctors are and have been in a similar position. I am worried about the injustice that they have suffered. I am also worried about the money that has been wasted paying them—money that could certainly have been better used by the national health service. Of course it is right that if people are suspended and there is nothing proven against them they should be paid. However, that does not solve the problem. I am worried about the waste of the state's huge investment in training those doctors in the first place, let alone the extra training for consultants. The doctors about whom I am talking today are or have been consultants.
It is perfectly true that the number of such cases is not huge, but I am sure that the House will agree that even one case is too many. Of the 101 cases of which I am aware, only 16 were found to be justified. That means that 85 doctors have been unjustly put through that hell, and it certainly is a hell. The resulting stress is severe, and it has four major sources. One source is the length of time that the cases take. I have cases on record that have lasted
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anything from two days to 11 years. The mean length of time to resolve them is two and a half years. In three cases, the doctors involved died while suspended, before their cases could be resolved.
In another case, the dispute dragged on for so long that the doctor reached retirement age before it was fully resolved. Although the disciplinary inquiry fully exonerated him at that time, and he was still below retirement age, the employing authority refused to give him his job back.
One doctor had to go to court a year after his suspension commenced to discover why he had been suspended. I was surprised to find that it is not uncommon for another set of allegations to be made if the first looks likely to fail. One doctor had to prepare defences for no fewer than four different successive allegations made over a long period before the authority decided to withdraw all the charges against him. One can only imagine what he went through during that time. I remind the House that justice delayed is justice denied. Something must be done to shorten the long periods during which the accused man or woman is under an extremely serious cloud.
The second reason for stress is the effect that such happenings have on a doctor's career. I have pointed out that it takes two and a half years on average to clear up such accusations, which is a huge chunk out of any medical career. I doubt whether any doctor could get back on the career ladder at the place where he or she would have been if the allegations had not been made.
Dame Elaine Kellett-Bowman: My hon. Friend is referring to extremely honourable people, most of whom were exonerated. However 16 doctors were not exonerated, and what if one of them were to work as a locum, as one did in the north-west? Nobody knew that the doctor had been suspended, he secured successive jobs and he proved to be an absolute menace.
Dame Jill Knight: I hold no brief for anyone who practises medicine after he or she has been found guilty of professional misconduct.
Dame Elaine Kellett-Bowman: It was before.
Dame Jill Knight: The same applies to any doctor who practises when he or she is suspended. I hold no brief for any of those 16 doctors: I am not pleading the case of doctors who should not be practising. Like my hon. Friend, I deeply regret the actions of the doctor to whom she referred. That was clearly wrong—particularly if that doctor was receiving full pay, which is the standard practice, during his suspension.
According to my findings, only a tiny minority of doctors are found guilty. Therefore, it is not unreasonable to draw the attention of the House to the injustice suffered by the majority. I understand perfectly that some individuals are very difficult to work with—that happens everywhere. There is no committee, office or school which does not have a member or an employee who could be described as an awkward cuss who does not get on with his or her colleagues. We have all had experiences of that nature, but it is not right to pillory the person who does not fit. Doctors should not be pilloried on the grounds of medical incompetence when no such incompetence exists and they should not have to face trumped-up charges.

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The third reason for stress is the cost of defence. The present disciplinary procedures are based on three national health service circulars. They define the categories for disciplinary action as: professional incompetence, professional misconduct and personal misconduct. The classification vitally affects the composition of the disciplinary tribunal panel—for example, whether there is a doctor on the panel and whether the existing professional defence organisations will assist the accused.
Although in their promotional literature such bodies promise to assist in all cases of employment dispute, it does not work out that way. One doctor was forced to pay £10,000 to defend himself successfully against allegations of professional wrongdoing. In that case, the defence body wrote that it was "not minded to help". Another doctor spent about £40,000 refuting allegations, while a third spent more than £50,000 attempting to refute trumped-up allegations. That money is not recoverable and, as far as I am aware, it is paid after tax. There is no right of independent appeal in cases of personal misconduct.
The fourth cause of great stress to doctors is the appalling stigma associated with suspension. In the constituency case that I mentioned at the beginning of my speech, the wife died—perhaps as a result of the shame, the upset and the worry of that situation. One suspended doctor made a very telling comment. He said:
"The hammer blow of suspension is utterly demoralising. One's confidence and trust in one's professional ability and eventually one's own self-esteem is severely undermined".
It is also true that the more conscientious and self-critical a doctor is, the greater his demoralisation. Doctors' professional and social standing is undermined. Such people are usually pillars of their society; they are well known and respected. They are probably members of local clubs and they enjoy a certain position in society. When the rumour of their suspension circulates, their position in society alters immediately and the stigma is terrible. They are ostracised, even though they are almost certain to be found innocent. People say that there is no smoke without fire and that there must be something in the allegations, but, if we use a little imagination, we can appreciate how hard it must be for such doctors and their entire families.
There is no better example of that than the constituency case to which I referred. Wrongly suspended doctors frequently suffer permanent ill health, and three doctors have committed suicide. Even when completely exonerated and compensated financially, very few doctors are able to come to terms with their treatment. Even after many years, they cannot let go. A core of deep resentment is established and it contributes to a serious depressive state. 'The cases have been checked and documented; I assure the House that I have studied the matter very carefully.
I do not know whether hon. Members are aware that all suspended doctors are locked out of their hospitals and that they could also be denied NHS treatment at those hospitals. One suspended doctor who suffered a cardiac arrest and was admitted as a patient to the intensive care unit of his hospital—perhaps his heart attack was caused by his circumstances—was transferred to another hospital because he was told that he was an embarrassment. I think that that is appalling.
Suspended doctors have also been denied the right to visit family members or friends who are patients in hospital. When the wife of a suspended doctor who had
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been locked out of his hospital for one year—the lock-out was instigated six months after his suspension began—was admitted to hospital as a patient, she was forced to appeal to the community health council for permission for her husband to visit her in hospital. Many community health councils are excellent bodies, but they do not work at the speed of light. By the time that council had finally decided to grant permission for the doctor to visit his wife in hospital, she was dead. Another doctor was locked out and forbidden to visit his wife as she lay dying of cancer in a hospital ward. Yet another was locked out and barred from collecting essential photographic evidence which he required for his own defence. The health authority apparently knew precisely why he wanted that evidence and they denied him the right to get it.
Another doctor had his suspension and lock-out maintained for nearly nine months after a disciplinary hearing had acquitted him of all charges. The verdict had been concealed from the doctor so he did not even know that he had been acquitted, but the lock-out was maintained for nearly nine months. I have no idea why that occurred, but I have strong ideas about the morality of such a situation.
Dame Elaine Kellett-Bowman: Is there no duty on the people holding those hearings to inform the doctor of the result? That seems quite extraordinary.
Dame Jill Knight: My hon. Friend makes a very good point. I have found so many injustices, and that is apparently another. I can only tell her and the House that that case actually happened. Whatever rules that exist do not work, and that is why I was so anxious to raise this subject today.
We are all told that suspension is supposed to be a neutral act, but I feel sure that those who have listened to me this morning would agree that those factors are not neutral. People have been treated appallingly. The notion that suspension is neutral is clearly not sustainable.
I believe that the information that I have sought and been given on this matter is entirely reliable. If it is, I find some of the reasons given for suspension extremely trivial. With all the consequences of a suspension that I have described, one would have thought that doctors could not be suspended without very good reason.
A serious offence, which could possibly justify dismissal, is not defined. Some of the reasons that I have discovered are trivial. There seems to be a wide variation in suspension reasons between different administrators. What some administrators judge to be a serious offence seems bizarre. One consultant was suspended for writing a repeat personal prescription for his ward sister. Another was suspended because he went through the clinical case notes of one of his own patients and took out papers that he, as the doctor, considered were redundant. A third was said to have over-claimed on his petrol expense. A motoring organisation later gave evidence that he had under-claimed to the tune of some thousands of pounds. The health authority finally had to pay him back.
One consultant histopathologist was threatened with a charge of professional incompetence because he sought a second opinion on a few slides. That is quite extraordinary. Surely it should not be an indictment to ask for a second opinion in any branch of medicine. That must be common because none of us can be so certain of our

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judgment on every case. Doctors should not be barred or accused if they ask for the opinion of a colleague who also knows the facts of the case.
My hon. Friend the Minister for Health may believe that the two guideline circulars, which were issued by the Department of Health to remedy some of those wrongs, are efficacious. With great regret, I have to tell him that they are not. HGL(94)49 was intended to shorten the period of suspension and suggested that doctors should be fully informed as to why they were being suspended. HC(90)9 was also intended to shorten the disciplinary period. Not one hospital authority or trust anywhere in the past six years has observed the rules regarding disciplinary action as laid down in those circulars. That is quite appalling.
Ms Hilary Armstrong: I am sure that the hon. Lady knows that a consultant from one of my local hospitals, Shotley Bridge hospital, has been suspended for four years. I have raised the issue in the House and the trust has now agreed to do something about the case. Suspension for such a long time is not in the interests of the doctor, the hospital or the patients. It is certainly not in the interests of the taxpayer, because the case has dragged on for more than four years and the doctor has been suspended on full pay. Therefore, he has not been making his contribution to the service and the taxpayer has been the loser. Such matters should be settled in a more effective, efficient way for the sake of the doctor, the patients and the taxpayer.
Dame Jill Knight: That is precisely the case that I am making and I agree very much with her. I have no doubt that many hon. Members have had such cases that have worried us. I am anxious to put on record that there have been efforts to put matters right, including the circulars that I mentioned. However, they have not succeeded in solving the problem and that is what worries me. In every case where dismissal was a possibility, the health authority has ignored the guideline documents.
It is probable that the guidelines are unenforceable. I turn for evidence of that to the minutes from the Public Accounts Select Committee of 15 March 1995, less than a year ago. The public accounts experts struggled for two and a half hours to try to unravel why a woman doctor was suspended for 11 years at a cost of £600,000 to the taxpayer and the health service. The Select Committee worked hard on the question and anyone reading the report will recognise the scale of the job it had to try to find out whose fault it was. My goodness, anyone reading the report will see that the Select Committee's job was like playing blind man's bluff at the same time as playing pass the parcel. The more I read the report, the more I thought it was a cross between Agatha Christie's "Murder on the Orient Express" and J. B. Priestley's "An Inspector Calls. It was no one's fault and nobody could be nailed for it, except the poor doctor who was suspended for 11 years. Extraordinarily, however hard the Select Committee struggled, it could not find out whose fault it was, why it all happened or how it could possibly have taken so long. The main witness who gave evidence to the Select Committee said that the rules to which I have referred were unenforceable.
Furthermore, in all cases alleging personal misconduct, the ACAS code of progressive warnings under the Industrial Relations Act 1971 has also been ignored.
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In 1988 there was a joint working party report on the matter, but it was not very conclusive. Nothing has come out of that report which has alleviated the problem, although it did cite some interesting cases including some in which doctors had sued for damages—an eventuality that I have not yet mentioned.
The fastest disposal of a contested case looked at by the working party took one year. The total cost was about £250,000. That included legal fees, costs and the salary paid to the doctor. Five years ago a doctor was awarded £100,000 in damages and that has to be added to the other costs involved. Two cases are estimated to have cost £4 million between them and another has already cost £1 million and is still proceeding. There are many other examples, but I hope that I have given the House sufficient to make my case. One estimate suggests that there are about nine or 10 new cases every year and the average cost is £400,000. So we could be losing as much as £4 million per annum for the health service.
I am asking my hon. Friend the Minister to look seriously at the case I have made and I feel confident that he will do so carefully. On cost grounds alone, the situation cannot be allowed to continue.
I have already mentioned that there is no right of independent appeal in the cases I have outlined and there are other aspects that worry me. The chairman of the tribunal panel is chosen by the prosecuting health authority from a list provided by the Lord Chancellor. In the past, health authorities have rejected certain nominations as being "unsuitable"—they have said no more than that. In all alleged misconduct cases, the tribunal panel is chosen by the prosecuting health authority. I hope that my hon. Friend the Minister is listening carefully because it is a serious issue of justice that the judging panel should be set up fairly.
The fact that the panel is chosen by the prosecuting health authority could suggest bias. There is a growing tendency to classify all charges as personal misconduct because that makes it easier for the health authority to control the panel. In those circumstances, the authority is the instigator, the prosecutor, the judge and the appeal court. It is Gilbertian in its scope. In one recent case a panel member was the very person who authorised the suspension of the doctor in the first place, and he was on the hospital board that subsequently decided to prosecute. The same board decided to bar from taking part in the judgment any member of the tribunal panel who was not a board member. Yet it is a well-established principle in European and English law that no body can be the judge in allegations that it, has made. There must be an independent assessment.
Under European law a doctor has a civil right to practise if he is so qualified and approved. That right can be removed only by a body appointed by law—the General Medical Council or the courts—and only after a fair and open trial. That has been agreed by the British Government. There was a recent case in which a French doctor's right to practise was challenged, but the doctor was found to be in the right.
The consultants I have mentioned have been denied their right to practise because suspension means that they cannot act at all. Therefore, in the eyes of European and English law, they have been told, unfairly and wrongly, that they cannot practise, although there has been no judgment by the GMC or a court. Surely that is wrong. To

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comply with European law all cases of suspension should rightly be referred to either the GMC or, where there are accusations of personal misconduct, to the courts or to an industrial tribunal. That has not been happening. On and on go the months and years in which a doctor is not allowed to practise in the circumstances I have outlined.
If I were the Minister, I might feel a frisson of apprehension about the possibility of being taken to the Court of Human Rights in the not-too-distant future by a doctor who has been prevented from practising without proper and accepted judgments being made.
It will be apparent to hon. Members that I feel strongly about all this. However, I want to make it absolutely clear—it would be unfair if I did not do so—that I do not regard this as the fault of the Government. All the reports that I have read suggest again and again that it is the fault of the extraordinary way in which some health authorities operate. They are responsible. I have already cited the case in which 11 years went by. That was not the Government's fault. Having said that, the buck always stops with the Secretary of State. It is an unfortunate truth and we must recognise it. He is forced to take responsibility for everything that goes wrong and these things are very wrong. I urge my hon. Friend the Minister to urge our mutual right hon. Friend the Secretary of State to set things right.
10.6 am
Mr. Roger Sims: My hon. Friend the Member for Birmingham, Edgbaston (Dame J. Knight) has performed a signal service by bringing this matter to the attention of the House and ventilating it publicly. I congratulate her on her success in obtaining the debate and on the manner in which she has presented her case. The House will be aware that I am a lay member of the General Medical Council and, in accordance with our rules, I should declare an interest in that I receive from the GMC a modest fee in recognition of my work as a lay screener.
My hon. Friend has illustrated effectively the dilemma facing any hospital trust when a complaint is made about a doctor, particularly when it reflects on his professional ability. Clearly, if a complaint is made, the trust—the doctor's employer—will be open to criticism if it suspends him immediately, particularly if what follows is a saga such as that outlined by my hon. Friend. Equally, it could be open to criticism if it did not suspend a doctor about whom complaints had been made. My hon. Friend the Member for Lancaster (Dame E. Kellett-Bowman) mentioned a case, with which I am familiar, which demonstrates that point.
If a doctor were found to have performed a certain surgical procedure or taken some medical steps with serious consequences and it were found that complaints had been made about him previously and nobody had done anything about it, the trust could find itself open to criticism. There is a difficult balance to be struck.
Dame Elaine Kellett-Bowman: The doctor to whom I referred was under suspension, but was practising as a locum.
Mr. Sims: That is a further dimension. Although things have improved a bit, a doctor can be suspended from one
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hospital and then offer his services elsewhere. If that new hospital does not make some inquiries about the doctor, what follows may be similar to what my hon. Friend the Member for Lancaster described.
A doctor may be suspended quite unexpectedly from his point of view, as he may believe himself to be completely innocent. The complaint may be without any foundation, so the suspension would be extremely distressing for him and his family. It is literally a waste of money because he is being paid for doing nothing. In addition, the hospital and the local community are deprived of his skills while he is suspended.
The main issue is how long it takes to resolve the matter when a complaint has been made and a doctor suspended. My experience is that it is by no means uncommon for it to take 18 months or even two years. Why? We can draw some comparisons with the time that it takes the police to make inquiries in civil and criminal cases. It often takes many months before the matter can be brought before the court. Why does it take that long?
A hospital may receive a complaint from a patient or a patient's relative that may be of such a serious nature that it feels it has to suspend the doctor. The hospital will want to pursue the matter. It will ask for further details about the complaint and then put the full complaint to the doctor, who will have the opportunity to respond. The complainant is given the opportunity to comment on what the doctor has said. An inquiry panel must then be assembled at a time and place convenient to all concerned. I accept that going through those procedures could take some time, but surely not a year, 18 months or two years.
When the panel has heard the evidence, it may conclude that the doctor is innocent and he will be cleared of the charge. However, if it decides that the complaint is justified in some respect, it may decide to punish the doctor. He may then wish to appeal against that decision—a process that can take a very long time indeed.
The problem is that that is not the end of the matter; there is a further dimension. The panel will make a judgment on the extent to which the doctor has failed to comply with the terms of his contract. A similar process applies to general practitioners. The decision will affect the doctor's professional standing. If the original complaint involved negligence—if there is any question about his medical skills—there may have been some justification for suspension. However, if it was an administrative matter, such as some of those referred to by my hon. Friend the Member for Edgbaston, I would find it extraordinary if the doctor were suspended.
If the hospital trust finds the doctor at fault and raises doubts about his professional competence, there is a virtual double jeopardy because the papers will be sent to the General Medical Council, which must then decide whether that doctor should be allowed to continue to practice or whether there should be an inquiry, possibly leading to suspension or even to his name being erased from the register.
Not only is that doctor suspended, not only is he is being paid for a job that he is not allowed to do—which must be extremely frustrating and demoralising for him—but he knows that at the end of the local process he may have to appear before his national body—and that could lead to serious consequences.
For most employees, employers deal with problems through admonishment or even by giving someone the sack. At least those employees can then try to get other

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jobs. For a doctor, however, that is not the case, as he may have to appear before the GMC and he may be suspended or even have his name erased from the register. He will have lost his livelihood. We must be aware of the serious consequences that can follow a charge of negligence.
In my capacity as a lay screener, and because I sit on the GMC preliminary proceedings committee, I deal with a number of such cases. It is quite unfair on a doctor to bring him to account for incidents that happened three or four years ago. Part of the reason for the delay is that it takes a long time to go through the process described by my hon. Friend and then through the appeal procedure, which is far too protracted. I hope that my hon. Friend the Minister will take that on board and take action to expedite the whole process.
I fully accept that the interests of the patient are paramount; we must ensure that only competent doctors serve patients. However, we must not forget the interests of the doctor, who must have a fair crack of the whip. I hope that my hon. Friend the Minister will feel able to do something about the problem.
10.16 am
Mr. Simon Hughes: I welcome the initiative of the hon. Member for Birmingham, Edgbaston (Dame J. Knight), who was kind enough to brief me yesterday on the range of her concerns. The overall matter is very important, as are the legal issues that it raises. The hon. Lady pointed out the apparent contradiction with European law in that in theory a doctor is in practice, but cannot practise because he has been deprived of the ability to do so. That raises proper legal issues.
I want to suggest to the Government a way to deal with the problem. I shall first make a point that widens the issue—there are parallels elsewhere. I do not do so in any arrogant way; I want to help in the process of finding a way forward.
The case has been made. The hon. Lady cited the most horrendous examples. No one in the health service, the health authorities or any other walk of life undervalues the significance consequences for an individual who is suspended but then later found fit to carry on. It is difficult to unwrite that bit of employment history. That applies not only in the health service, but in other parallel public services.
One point that the Minister might consider is the apparent non-compliance with the guidelines. The hon. Lady said—I have no reason to doubt her—that no trust has complied with the rules. The Department needs to deal with that speedily.
Similar issues in the public domain have arisen in two or three other professions. First, there have been well-reported cases of police officers being suspended because of allegations made over long periods. Secondly, teachers are often suspended for lengthy periods after allegations, often serious and worrying, by pupils. It may be a long time before the individual can return to teaching. The rumour, speculation or allegation may be made public, and the teacher's career may be severely damaged as a result.
I declare an interest in relation to the teaching profession. I have discussed the matter with the Association of Teachers and Lecturers—a teaching union
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for which I act as a consultant and which, as with the hon. Member for Chislehurst (Mr. Sims) and the GMC, pays me a small amount for my advice. It does so also for some Conservative Members.
Mr. Deputy Speaker (Sir Geoffrey Lofthouse): Order. The House is debating hospital doctors.
Mr. Hughes: The parallel that I have drawn with teachers is relevant to the hon. Lady's case, and I will suggest a way forward that applies to them all.
Perhaps the Minister could consult on the use of employment law. The matter may ultimately be for the Department of Education and Employment. If the problem ranges more widely than trusts and the health service, there should be another way of dealing with it. It would be nonsense to have one system in the health service and a different one for other public services, such as local authorities and the police.
The hon. Member for Chislehurst spoke of reviews. If the Crown Prosecution Service or another authority takes too long to process a case, it is called before the magistrate to report progress. When a suspension occurs a court or, more appropriately, an industrial tribunal should have the power or be required periodically to consider the evidence from all the parties. If an individual were suspended today, for example, it would be his automatic right to have the state of the investigation regularly considered by an external person, beginning in one month's time. The suspended professional should be able to say, "I am being kept out of my job. Nothing is happening quickly. What is going on?", and an objective third party could say, "You're right. This is unacceptably slow." That third party could lay down a timetable and rules to govern the investigators.
Fundamental to the hon. Lady's case is a guarantee that the persons considering disciplinary action are entirely independent. In registered nursing homes, a disciplinary suspension and the adjudication on the individual's ability to continue in employment can be dealt with by the same people, which is entirely inappropriate. Of course the adjudicators can take evidence from the individuals who enforced the suspension, but the adjudicators must be independent and be seen to be independent. An external element may also be needed.
The House has just dealt with the final stages of a Bill to improve the procedure for health service complaints. It is unlikely that any of the hon. Lady's proposals can be incorporated in that measure. However, that Bill has just gone to the other place. It may be appropriate for any possible amendment that can quickly be made to be incorporated in that Bill. At most, that can accomplish only some things—the issue is much wider. I hope that the Minister will deal with action that can be immediately implemented by his Department, but it may be for the Department of Education and Employment to examine the issues as they apply to all professions across the range of public service.
10.24 am
Mr. Henry McLeish: I am pleased to participate in the debate and to echo the congratulations extended by other hon. Members to the hon. Member for Birmingham, Edgbaston (Dame J. Knight) on bringing the issue before the House. She graphically illustrated the

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problems that arise during suspension—including delay, the impact on the individual's career and the stress caused to the doctor and his or her family.
Major problems continue to arise, despite two measures having passed through the House over the past year—the Health Service Commissioners (Amendment) Bill and the Medical (Professional Performance) Act 1995—which strengthen health service complaints procedures. The inordinate time taken in some cases of suspension cannot be justified. If trusts look carefully at their procedures, they may reach the same conclusion.
To be fair to the Government, they have improved the procedures for processing complaints. The new three-tier system will operate from 1 April, and the monitoring powers of the General Medical Council has been strengthened. However, consideration of the matter must go beyond the structures and institutions in pinpointing why major problems continue.
Every trust has the ability to modify or change its procedures—the Minister will correct me if I am wrong. The hon. Member for Edgbaston said that national standards are needed. Fairness should apply not just in Birmingham or Glasgow but across the length and breadth of the country, and we are not seeing that. I repeat that the time taken to process some cases cannot be justified. What is going wrong?
One answer is that not enough priority is given to individual cases. The British Medical Association, among others, has pointed out that the issue is clearly one for the individual. On the other hand, there are implications for the hospital involved. The BMA points out that the suspended consultant may lose clinical skills, especially if the suspension lasts two, three or four years. A backlog of cases can be created when a specialist is lost to a hospital, and there is additional pressure on colleagues. That can be another problem in a health service that is already subject to strains and tensions.
The BMA also points to the lack of continuity of patient care. There can be nothing worse for a patient than to lose the services of his or her usual consultant. Of course, serious offences may be involved. No one is arguing that there is no case for the safeguard of suspension—but often it should be exercised as the course of last resort. Trusts may be opting for suspension rather than another course, which may not be best.
I agree with the hon. Member for Edgbaston that cases should be resolved more quickly. Obviously the issues are complex. [Interruption.] I do not know whether the Minister is mumbling in agreement or just mumbling to one of his hon. Friends behind him.
The Minister for Health (Mr. Gerald Malone): I was commenting to one of my hon. Friends.
Mr. McLeish: That is gratifying at this time of the morning, rather than being insulted—as I am usually.
Mr. Malone: Never.
Mr. McLeish: There is a mood of magnanimity this morning, at least in this debate.
Why do appeals and suspensions take so long? Trusts are not short of administrators, clerical employees and bureaucrats—people who want to do such work. Why
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should there not be a national standard and a time constraint? Some individuals will need to be suspended immediately and the cases will take a long time to resolve. The Minister could therefore aid the House in further discussions by painting a picture of what is happening nationally. We need more information.
In his winding-up speech, perhaps the Minister will be able to provide information on the number of complaints against hospital consultants and doctors being processed, the average length of the cases, and where they are occurring. I suspect that in some areas, that information would not be heartening. Clearly, in Birmingham and other areas, cases are arising routinely. The other issue that concerns me is the cost of the processes when we need to be spending as much as we can on the real business of hospitals.
Adjudication procedures concerning allegations of medical misconduct of hospital doctors is an excellent issue to discuss in the House. Although we clearly do not lack structures and institutions to cope with the problem, we must look to the trusts at the front end to improve matters. I am sure that the Minister will respond positively and I hope that he will seek information from each trust about what it is doing so that he can make a judgment on whether many of the delays are necessary. I am sure that an informed debate based on information from trusts will help to speed up the process, ease the misery of many doctors and consultants and ensure that the health service, through the trusts, is providing front-line patient care rather than dispensing of its energies or dissipating them through long suspensions.
10.31 am
The Minister for Health (Mr. Gerald Malone): I am grateful to have an opportunity, courtesy of my hon. Friend the Member for Birmingham, Edgbaston (Dame J. Knight), to address what the speeches of other hon. Members have shown is an extremely important subject. I am not sure whether I shall be able to go along entirely with the attempt of the hon. Member for Fife, Central (Mr. McLeish) to write part of my speech for me. I agree with him, however, and with my hon. Friend, that the matter is important not only for the medical profession but for patients—as my hon. Friend the Member for Chislehurst (Mr. Sims) said.
It is right that the House should debate a matter about which there is clear concern. Although I cannot go the whole way with my hon. Friend the Member for Edgbaston in some respects, some of the cases that she described seem to raise extremely serious issues, so I should be grateful if she would take them up in more detail—although that would not be appropriate in a debate on the Floor of the House. If what she is saying is borne out by evidence, I would be extremely concerned as it would be clear that the employing trust was not adhering to the very detailed guidelines on important matters.
The guidelines are constantly being reviewed and updated, as my hon. Friend said. She said that much progress has been made in recent years. The detail of the guidelines is such that I hope to be able to convince the House that the Government take the matter very seriously as a national responsibility, although that responsibility must be developed locally between employer and employee.
Dame Jill Knight: I am grateful to my hon. Friend for the receptive way in which he is replying to my remarks.

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There would be no problem whatever in furnishing him with more detailed information. As he rightly said, and as I judged, it would not be correct to go into great detail, giving names, places and so forth in this debate. Would he therefore agree to see a small deputation of people who have been studying the matter? They are all doctors and they could cite chapter and verse. It might help my hon. Friend to see them as a groupx2014;not a very large group—because they are knowledgeable and have spent a long time tabulating and examining cases.
Mr. Malone: I am grateful to my hon. Friend. If she would let me have details of what she is proposing, I shall—as always with any request that she makes—look on it very sympathetically.
It might benefit the House if I clear a little of the fog around the issue. It is important to understand the issue in its various components. There is the issue of suspension; the separate, but related, issue of disciplinary proceedings, which runs to a strict timetable; and paragraph 190 appeals should a medical practitioner employed by a hospital decide to exercise that right. When describing various cases, hon. Members have shown that, where separate procedures have been taken one after the other, there has been some muddying of the waters in understanding what rules apply to each procedure.
I do not wish to be defensive, but I am sure that the House will understand that where there is a need in the procedures to be fair to the interests of the public and the individual medical practitioner, there can be delays for a number of reasons. I do not want to refer to any particular case, but the Medical Defence Union—if it is representing a medical practitioner—or the British Medical Association may want to take a considered view of the matter, and take some time to investigate it fully, in order to present the case on behalf of their member. That is quite right, and in some cases it is an understandable reason for delay.
Illness of the medical practitioner is another reason why there might be delays, which on superficial examination might appear inordinately long, in the processes that we have set down. It is important to study each case to see whether it raises issues of unfairness. When it does, it is a matter about which nobody should be complacent.
My hon. Friend the Member for Edgbaston made much of suspension. It is important to see the matter in context. Evidence to the Public Accounts Committee revealed that only six cases of suspension had endured for more than six months. The six-month period is important because the system requires suspensions of more than six months to be reported to regional health authorities. That will continue after 1 April under the NHS executive because Ministers consider it vital to be informed of delays that go beyond the time limit set out in the guidance. It also encourages trusts to ensure that they comply with the guidelines which, as my hon. Friend said, are set out in HSG(94)49.
It is important to understand the aim of the guidance, which is to avoid unnecessary suspensions. We do not want to be suspending doctors for any reason. Employers are encouraged to consider suspension as something that might be necessary, but that should be avoided if at all possible. They are also told to ensure that, if practitioners are suspended, it should be for the minimum period necessary. I am sure that my hon. Friend was not suggesting that employers should not be entitled to use suspension—
Dame Jill Knight: No, I was not.
Mr. Malone: My hon. Friend confirms from a sedentary position that that is so.
The House must consider suspension from both sides of the mirror—if I may put it that way. If we had a debate that was prompted by a patient's interest, where something had gone wrong and a clinician had not been suspended and where I was not able to assure the House that it was a balanced process and suspension was available to hospital trusts—the employers—the House would rightly take a pretty dim view.
We must consider whether suspension is carried out reasonably and in accordance with the guidance. Suspension should be seen as a neutral act. This goes to the heart of the point made by my hon. Friend the Member for Edgbaston. Suspension is not intended to do other than protect the interests of patients, staff or, indeed, the practitioner. It is meant to assist the investigative process. Of course, it is understood that it is a measure that could have extremely serious consequences in both human and financial terms—my hon. Friend gave us a clear example of that—especially where the suspension proves to be lengthy. That is why timetables are set.
Suspension may be considered when a member of staff needs to be removed immediately from the employer's premises to protect the interests of patients, staff or the practitioner. That, I suggest, is the extreme end of the spectrum. One can foresee circumstances in which it would be necessary. It should be confirmed immediately in writing—this deals with fairness—so that the person who is suspended is made fully aware of what is going on. The letter should state clearly the effective date and time of the suspension, and the content of the allegations and confirm that a full investigation will follow.
As it is a neutral act, it would be extremely unfair not to suspend on full pay, because to do anything else would be to prejudge the issue. I remind the House that suspension takes place at a point when no judgment has been made about what is alleged.
A review of the suspension should normally be undertaken at least every two weeks, and the outcome reported to the chairman or non-executive director who is responsible for the matter. The practitioner concerned should be informed of the outcome of each review. If the investigation has not been completed within three months of the date of suspension, a report should be made to the trust board or health authority outlining the reason for the delay and indicating how long the suspension is expected to continue. It should also include a plan for the completion of the investigation.
The guidance is clear on fairness and on setting a timetable. Should delay appear to be built into the process, the guidance clearly sets out a timetable whereby an employing trust must justify any delay. The importance of that is that suspension cannot continue to be disregarded for an inordinate period.
Mr. Simon Hughes rose—
Dame Jill Knight: Will my hon. Friend give way?
Mr. Malone: I shall give way to the hon. Gentleman first, and then I shall give way to my hon. Friend.
Mr. Hughes: What can a suspended employee do if he or she believes that there is delay, that the guidance is not being complied with or that the reports are not proceeding? What can they do to speed up the process and ensure that the guidance is complied with?
Mr. Malone: It depends entirely on the circumstances. The process is designed for both parties, and under it the person who is suspended can be involved and encourage progress. There is nothing that says—I presume that this is the point that the hon. Gentleman makes—that further deadlines must be complied with, because during the suspension process investigations are undertaken. The suspension is reviewed regularly by a designated person to whom the person under suspension can complain or draw attention to the fact that matters are not proceeding properly. At that stage, any failure in the process can be brought to the attention of those who are responsible for speeding it along in the most appropriate way.
Although my hon. Friend the Member for Edgbaston rightly said that speed is important, in other circumstances it might not be of the essence. The person under suspension might wish to make their own preparations for what may follow. It is a two-sided argument, and that is as important an aspect of it as the other.
Dame Jill Knight: What my hon. Friend said a moment ago seemed to suggest that the guidelines should have been able, and were able, to stop such cases occurring. I cited the suspension of Dr. Bridget O'Connell, whose case was dealt with by the Public Accounts Committee only last March and who had to wait 11 years, despite the fact that the guidelines were in existence. Surely in that case the guidelines were proven to be ineffective.
Mr. Malone: The House examined the matter some time ago and was well informed on it. I think that my hon. Friend would concede that, following inquiries, the guidelines were improved. I am dealing with suspension; the case to which she referred continued after going through a number of complicated processes. I do not think that the case to which she refers falls into the category of suspension. She raises a wider point, which I shall come to. I intend to deal with the whole process and how it should take place.
The recommendations of the working party, in 1990, gave rise to further guidance. It made a number of recommendations about the disciplinary procedure, all of which were taken on board. They dealt not only with the setting up of inquiries but with the timetable for the completion of the disciplinary process. It might be helpful if I set out the timetable to the House.
After the chairman has decided that there is a prima facie case to answer and has informed the practitioner, the practitioner has four weeks in which to comment on the case. After receipt of the practitioner's comments, the employing body can decide, within two weeks, to follow that procedure. Thereafter, the chairman of the inquiry panel is appointed and the panel meets within 13 weeks. The hearing is concluded within one week. A report is produced and the factual part is sent to the practitioner within four weeks. The practitioner makes comment within those four weeks, and the report then goes to the health authority within four weeks. It is a strict timetable and it must be complied with in such inquiries.
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My hon. Friend questioned whether inquiries might be biased. It is important that an investigating panel is seen to be independent of the employer; that is in the interests both of the employer and of the practitioner. Although it is set up by the trust responsible for the appointment of the practitioner, it is important to understand that the panel is distant from it. The guidance stipulates:
"No member of the panel should be associated with the hospital(s) in which he works".
Not only should no panel member be an employee of such a hospital, no panel member should even be associated with one.
The guidance continues:
"In all cases the panel should be small, normally of three persons, including a legally qualified Chairman, not being either an officer of the Department of Health or a member or officer of the"
employing trust. The chairman
"will be nominated in each case which arises by the Secretary of State from a panel appointed by the Lord Chancellor."
That is an important safeguard for the investigating panel. I am not sure what better safeguards one could build in.
That passage continues:
"In cases involving professional conduct, the members other than the Chairman should contain an equal proportion of professional and lay persons, unless the charges relate only to relationships between a doctor…and his professional colleagues, when it would clearly be appropriate to have a panel wholly or predominantly of professional members, apart from the Chairman."
The independence of the investigating panel is ensured and supported by those guidelines, which have been set out carefully to deal with such matters.
One of the other points raised by my hon. Friend the Member for Edgbaston relates to compliance. The hon. Member for Fife, Central raised that matter too, and asked the sensible question: whether, as all that guidance exists, we are certain that it is being complied with. My hon. Friend suggested that no trust is complying with it—an assertion for which, if she does not mind my saying so, I should like to see a little more authority. I would be concerned if it were true, but I do not think that it is. It is important that the guidance has force, and is not disregarded.
Guidance for national health service trusts, which are separate and independent bodies, has developed since the health service reforms. Hospital trusts have a history of heeding it, and it is heeded in this instance, but guidance is no more than that, and I do not pretend that it is.
I would not go down the road favoured by the hon. Member for Fife, Central, and suggest that we should enforce the guidance rigidly on a national basis. I agree that the guidance forms an important framework that underpins the rights of individuals, Inn it would be unfortunate if the ability to deal with matters at a proper level—between employing trusts and their employees—were lost, and we were to go beyond setting out guidance with which we expect trusts to comply, but upon which we understand that they may wish to build.
Mr. McLeish: No one would disagree with the logic of the Minister's contribution. The central point is the fact that we have structures, institutions, guidance and processes. That is not the issue. I do not say that we necessarily want a heavy hand directing from the centre, but what we have heard has made it clear that there are excesses in the system. Perhaps the cases that have been

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mentioned are profoundly complex and take masses of time to resolve. None the less, it would be instructive for the Government and for us if we could find out what is happening throughout the country, so that any further consideration by the Minister could be informed by what was happening in the trusts. This is not a case of the trusts ignoring the guidelines, but it is clear that the application of them may differ from one trust to another. That may be healthy in some respects, but we need consistency and fairness, and that consistency would be better informed if we knew what was happening throughout the country.
Mr. Malone: The system gives me that information, should there be undue delay. I have explained to the House that, if there is undue delay in resolving a suspension and turning it into either a full inquiry or a dismissal of the complaint, the information is gathered after six months. When evidence was given to the Public Accounts Committee, six such cases were outstanding. Considering that more than 17,000 consultants are employed by the NHS, that is a small number.
When such a delay has been brought to our attention, of course inquiries are made about whether it is reasonable; we fully expect people to comply with the guidelines. The guidance is not simply thrown out into the blue yonder, with Ministers washing their hands of it and saying, "We have written the guidance, and that is all we intend to do." It is important to us that there is general compliance. However, I reiterate the fact that we expect employers to build on the guidance in a manner appropriate to their local circumstances.
It is important that all procedures are clear and flexible and ensure that patients' interests are protected, that fair treatment is provided for practitioners, that cases are dealt with as speedily as possible, and that professional advice is taken in appropriate circumstances in individual cases. Those are the principles on which the guidance is based.
My hon. Friend the Member for Edgbaston raised several specific points, with which I shall now deal. First, she said that suspension was sometimes used for trivial reasons. The guidance clearly implies that suspension is a serious matter and should not take place for a trivial reason. However, what is a trivial reason in the eyes of one party may be an important reason in the eyes of another. I can certainly give my hon. Friend the assurance that I would not expect trivial reasons to lead to suspension. I would expect employers to consider all such issues carefully, as the guidance requires them to, before taking the important step of suspension.
My hon. Friend also talked about the process not affecting the right to practise. It does not. The hon. Member for Southwark and Bermondsey (Mr. Hughes) rightly said that there are other ways in which the right to practise can be handled—through the General Medical Council.
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Perhaps it would be helpful to my hon. Friend if I were to clarify the position. Suspension is a neutral act, so if a practitioner under suspension decided to resolve the matter himself or herself by simply moving out of the context of that employment and getting another job, that would be entirely possible. Nothing would have been proven against the practitioner, and it would be wrong to prejudge the issue by saying that the right to practise should be diminished by the act of suspension.
Dame Elaine Kellett-Bowman: Should not the fact that the practitioner is under suspension be disclosed to the hospital to which he applies?
Mr. Malone: Suspension is a neutral act. My hon. Friend is suggesting that suspension should be seen as something other than a neutral act.
The House has put legislation on the statute book which allows immediate referral to the GMC if the suspension involves a serious matter of basic professional competence, and that is the correct route in such cases. That is a decision for the individuals involved. We must not forget—I am sure that my hon. Friend the Member for Edgbaston does not forget—that a reference to the GMC can be made by someone other than the employing body; it could be made by a fellow practitioner. There is a range of ways in which to handle that aspect of the ability to carry out medical practice, apart from the act of suspension.
This has been an important debate. I thank my hon. Friend for giving me the opportunity to address some of her concerns directly and to explain the position on suspensions and investigations. I hope that I have also given the House an assurance that the Government take the matter extremely seriously. I hope that my hon. Friend will bring the individual cases that she has raised to my attention. I shall be happy to consider them, and I have said that I shall consider her request for a meeting with those who have raised them with her.
When we talk about the suspension of a member of any profession, we are dealing with a difficult and sensitive area. The hon. Member for Southwark and Bermondsey alluded to some parallels. It is vital to the public interest and to patients that we get it right. We have made excellent progress in recent years. Where we have been able to learn lessons, we have always been happy to translate them into the guidance that we expect to be reflected across the service. We have an open mind on these matters. Where improvements can be made-we can discuss that with the profession in particular-we are more than happy to make progress and build on the current guidelines.

Meat Hygiene Service
10.59 am
Mr. Edward O'Hara: When the Fresh Meat (Hygiene and Inspection) Regulations (1995) were laid before the House in March 1995, I tabled early-day motion 845, in which I posed certain serious questions about the rationale, proposed operation and likely effectiveness of the Meat Hygiene Service. The early-day motion attracted considerable support from a remarkable spectrum of interests across the House, an indication not only of the strength of the case but of the far-reaching implications of the new arrangements for abattoirs and jobs across the country.
Following a prayer against the proposed regulations, they were presented for the scrutiny of the Fifth Standing Committee on Statutory Instruments on 4 April 1995. A devastating case against the regulations and the introduction of the MHS was developed in that Committee with the support of the hon. Members for Clwyd, South-West (Mr. Jones), for Manchester, Central (Mr. Litherland), for Carmarthen (Mr. Williams), for North Cornwall (Mr. Tyler), for Aberdeen, North (Mr. Hughes) and for Ceredigion and Pembroke, North (Mr. Dafis)—an interesting cross-section of Members.
The rationale offered for the establishment of the MHS had three legs—greater cost-effectiveness, greater efficiency and greater consistency in relation to the existing system managed by local authorities. In Committee, it was clearly demonstrated that the MHS would not satisfy any of these criteria.
In terms of cost-effectiveness, the MHS has an establishment that costs about £54 million to run. All these costs must be taken out of the industry in charges. I have heard varying figures for the cost to the industry in charges to local authorities under the old system, ranging from £26 million to £45 million. Whichever figure we take, there is a sudden and serious increase in overheads to be financed by the industry.
I shall not burden the House with excessive repetition of the case made in Committee, as the non-validity of the claims of greater efficiency and greater consistency will be exposed in my remarks today. Suffice it to say that, I made no apology then for stating that there was a crisis in the fresh meat industry in two respects.
First, small and medium-sized operators, such as Sammy Morphet of C.S. Morphet and Co. in my constituency, were predicting that they would be driven out of business by the increased charges. Indeed, in my early-day motion, I asked whether the new system was actually intended as an instrument for enforced rationalisation in the industry. This was a serious question, as to whether we were witnessing rationalisation by statute, rather than by inducement and compensation.
An important aspect of the crisis in the industry was the breach between the hierarchy of the Federation of Fresh Meat Wholesalers—the consultative body for the industry favoured by the Ministry of Agriculture, Fisheries and Food—and people such as Sammy Morphet of Cronton in Knowsley, Thomas Slinger of Greater Harwood near Blackburn, E.D. Jones and Son of St. Asaph, Cig Mon Cymru—I hope that the hon. Member for Ynys Mon (Mr. Jones) will forgive my
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pronunciation—from Llangefni in Anglesey and Keighley Abattoir Ltd. Mr. Whitely, from the last company mentioned, said in a letter that was passed to me in April,
"For God's sake make them understand what is going on".
Many others have been involved, including Toby Baker of Nailsea. I mention him in particular because he is the secretary of the Quality Meat and Livestock Alliance, to which many disillusioned small and medium-sized operators have turned to represent their interests.
Secondly, many endangered operators are determined not to pay the increased charges with which they are faced under the new system. It is a classic case of "can't pay, won't pay". I have kept in touch with the situation since the introduction of the Fresh Meat (Hygiene and Inspection) Regulations 1995 and the inception of the MHS, and I take no pleasure today in saying, "I told you so". All the predictions have come to pass, and a report in the Daily Mail this week stated that 120 companies are refusing to pay their fees to the MHS, which is facing a shortfall of £14 million in its annual budget.
MHS has served writs on three companies, including that of Sammy Morphet in my constituency. Sammy Morphet is happy to lead with his chin and test the principles at issue in court, the High Court and the European Court of Justice, if necessary. He describes the new system as a shambles, and cites the example of the residue inspection charges. In the past, MAFF checked any meat suspected of containing harmful chemical residues and, as I understand it, made no charge. Under EU directive 86/469, a new system was set up, co-ordinated by the Government's veterinary medicines directorate and run since April 1995 by the MHS.
The charge imposed by the MHS for this service on C.S. Morphet is £12,000 per annum for the analysis of eight pigs' kidneys a month.
The Minister for Food (Mrs. Angela Browning): I am sorry to interrupt the hon. Gentleman, but he should be aware that, prior to the MHS carrying out the testing duty, Mr. Morphet was invoiced by Knowsley borough council. It was not a free service—he received bills for the inspections.
Mr. O'Hara: There was a dispute at that time between Mr. Morphet and Knowsley council, and the council understood that Mr. Morphet was making a test case at that time. When I was referring to a free service, I meant the service that was in operation before EU directive 86/469. I am grateful to the Minister for pointing that matter out, but I was aware of it.
I was referring to the charge of £12,000 per annum for the analysis of eight pigs' kidneys per month. While £12,000 in itself is a burden on Mr. Morphet's business, he could not believe what happened next. During the summer of 1995, MHS officials arrived at his abattoir with a fridge-freezer, which they plugged into his electricity supply—without asking permission, by the way. Eight kidneys per month were placed in the fridge-freezer by MHS inspectors but, from June to December, no one came from the MHS to collect them. However, on 14 December 1995, Mr. Morphet received a bill for £5,000—for the inspection of the kidneys that were still in the refrigerator.
In case one thinks that that was an isolated case of cavalier charging in the meat industry, I shall give the example of Cig Mon Cymru, from the constituency of the

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hon. Member for Ynys Mon. In March 1995, the firm received its last bill from the local authority for inspection services at its abattoir in Llangefni. The charge was £9,945.18 for 60,061 sheep slaughtered in a four-week period, which works out at 16.56p per sheep. On 27 June, the firm received its first invoice from MHS for a two-week period from 3 to 14 April 1995, when 25,699 sheep were slaughtered. The bill was for £6,405, or 24.92p per sheep—an increase of 50 per cent.
There are by-products of these increases. For example, the increases are not uniform across the industry, so livestock traders will pick and choose their abattoirs. That can mean that a longer distance is travelled by live animals for slaughter. Jobs are being lost in abattoirs, which may have to close for that reason or because of heavy charges alone. The current position also encourages live exports to Europe, where abattoir rates are cheaper. No wonder Sammy Morphet faces an extra £30,000 a year in charges for his average throughput of between 2,000 and 3,000 pigs per week.
Another example of cavalier charging relates to the recognition of experienced slaughterers. The industry might understand a charge of £65 for the validation of newcomers to the trade, large though the increase is in comparison with the original nominal fee of £1-the charge may have been reduced recently; I do not know the exact figure—but experienced hands in slaughterhouses not only consider the charge exorbitant, but find it demeaning to be validated by official veterinary surgeons who, although they may have professional veterinary skills, do not possess the manual skills with the knife that are the essence of the slaughterer's trade.
That brings me to the nub of the dispute between the dissident element in the trade and the MHS. The justification for the new system is the implementation of European directives governing meat hygiene. No one argues with the principle, but it must be asked how the new charges here can be higher than charges elsewhere in Europe. In fact, the question, "How are the charges so high?" is easy to answer; more interesting is the question, "Why are they so high?"
Let us deal with the "how" question first. Ante and post-mortem inspections are carried out in abattoirs in accordance with European Union directive 91/497. Under the MHS, they are conducted by official veterinary surgeons, who cost more than mere meat inspectors. Yet it is maintained that the identification of unsound meat is a special skill that can be acquired by technicians who do not need the full range of skills possessed by the veterinary surgeon—stockmen or slaughterers, for instance. Indeed, it could be argued that a typical OVS does not possess the knife skills that are necessary for the post-mortem examination of a carcase under directive 91/497. Official veterinary surgeons are expensive—and that is why MHS costs are so high.
Members of the trade would maintain that OVSs are not needed in static postings in all abattoirs. Indeed, it could be said that it is their visible input in static postings that has lowered their credibility among experienced practitioners in the trade. OVSs would make better use of their specialist skills, and recover their credibility, in the role of monitors of meat inspectors in more than one abattoir. The resultant service would be cheaper, too, and directive 91/497 would be met. I understand that the system works satisfactorily elsewhere.
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Let me make two further points. First, it may be asked what the ante-mortem inspection achieves that cannot be achieved by the post mortem. Secondly, I am advised that the whole system of inspections is—here I use a word that I have used before—a shambles. Abattoirs are reporting variations of as much as 400 per cent. in the inspection hours allocated to similar slaughtering operations. In some abattoirs, inspectors will examine "green offal"—stomachs and intestines—and in others they will not. Some inspectors insist on being present throughout the time when killing takes place; others do not. The Government have cited inconsistencies between local authorities as a justification for the new system. So what is different?
Previously, if a proprietor had a complaint or query, he or she had only to call in at the local council office; now he or she must try to communicate with a remote organisation in York. No wonder it is known as the Kremlin: it cannot communicate answers to simple questions such as how many hours are being charged for when invoices are presented.
MHS field staff are no less bewildered. They find themselves being arbitrarily allocated to slaughterhouses miles from their former work places, and doubtless their travel costs are passed on to the slaughterhouses. They find that overtime is subject to random variations, and that—especially in the case of part-time inspectors—work is erratic and uncertain. They find that the overwhelming burden of paperwork takes colossally more time than under the old local authority system, and they must endure a constant flow of confusing edicts and counter-orders from York. That is what I mean by a shambles.
Mr. David Nicholson: On 4 April last year, a Standing Committee implemented the regulations. The hon. Gentleman was a member of the Committee; I attended, although I was not a member. When I asked my hon. Friend the Minister to assure us that the system that was about to be introduced was the simplest and most cost-effective system that could be introduced consistent with the European directive, she told me that there would be
"close contact with the MHS to ensure that the organisation's costs are held down year on year."—[Official Report, Fifth Standing Committee on Statutory Instruments, &c., 4 April 1995; c. 8.]
The hon. Gentleman has done Parliament and the country a great service in bringing to our attention horrific evidence of the costs of the new system, and I wish him well in his efforts.
Mr. O'Hara: I thank the hon. Gentleman for his support. Sadly, all the horrifying predictions are coming true.
I said that the organisation was a shambles. That brings me to the other question that I posed: why does such a system exist? That, as I said, is the interesting question. The answer lies in the nature of the MHS, which is not a simple quango but a self-financing regulatory authority, or SEFRA. It has an establishment of about 1,000 staff, and its total running costs are some £53 million or £54 million—all to be financed from charges levied from the trade. It is not subject to Treasury strictures and controls like other quangos—like, for example, my local NHS hospital trust, with which I had some dealings earlier this week. It is currently having to cope with a directive to cut management costs by 5 per cent. and allocate the savings to front-line services.

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A SEFRA, however, has every incentive to perpetuate its bureaucracy by imposing ever more, and ever more unreasonable, regulations on what it calls—in a distortion of the term—its customers. It means the trade. The customers of the MHS are, in fact, the public, whose health it purportedly exists to protect. It is as if the police financed their traffic services with the fines levied on speeding and over-the-limit motorists, and called them their customers.
There is, however, a more sinister aspect, which also derives from the nature of a SEFRA. I mentioned earlier that a large block of the trade—some 120 firms—had lost faith in the Federation of Fresh Meat Wholesalers. That is because they feel that the big operators who are the hierarchy of the FFMW are supporting the MHS, with all its faults, precisely because its operation, as I have described it, will drive the small operators like Sammy Morphet out of existence. I shall not use the term "unholy alliance", but there is a convenient coincidence between the interests of the big operators and those of the people who run the MHS.
What is in it for the big operators is that they will eventually dominate the trade when the small operators are driven out of business; what is in it for those who run the MHS is a lucrative, risk-free business with rich remuneration. That is why last year, in early-day motion 845, I questioned the interests involved in that risk-free business.
What is the prognosis for the long term? When the big operators have the field to themselves, they will call the shots. They will be in a position to dictate to the MHS. For example, by threatening to relocate elsewhere in Europe—many are multinationals—they will be able to expose the MHS shortfalls in fee income and so ensure that their wishes dominate the continuing activities of what is called the "Service". The technical term for that is regulatory capture.
I am talking about cartels. They will be able to force the imposition of new regulations, which will drive smaller rivals out of the trade and prevent newcomers from coming into it and it will all be done in the name of such virtuous cloaks as meat hygiene.
I have the evidence for that in a letter from the general secretary of the FFMW to the principal finance officer of the Ministry of Agriculture, Fisheries and Food, dated 8 November 1995, which refers to unpaid bills that existed at the time and includes the words:
"it would be helpful to this end for the Minister to stick firmly to his stated intention not to issue licences to plants which have not achieved the structural standards required by the end of the derogation period on 31st December 1995, (except in exceptional circumstances beyond their control)."
This is the interesting point:
"This would have the effect of at least preventing a number of plants who have no intention of fully complying with the legislation or paying MHS bills from continuing to exacerbate an already serious situation".
That is a sinister comment in a letter from an officer of the FFMW to an officer of MAFF.
What will be the consequences for the true customers of the MHS—the meat-buying public? There will be a reduction in consumer choice, as the fewer large outlets will concentrate on standardised fare to the exclusion of
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the variety of livestock breeds available through smaller, specialist outlets. I imagine that such outlets exist in constituencies like that of the hon. Member for Ynys Môn—in rural areas.
The cartel will be able to control prices to a much greater extent because small, independent livestock buyers will be removed from the market. There is a close analogy with the domination of the retail trade by the giant supermarket chains. But, in the case of the meat industry, there is an added and serious dimension. Food safety—the ultimate rationale of the MHS—will deteriorate. With fewer, larger units processing greater numbers, there will be increased danger of cross-contamination in slaughterhouses, increasing the spread of such bacteria as the salmonellas, campylobacter and E. coli 0157. Incidentally, it is worth noting that the only E. coli outbreak ever associated with meat came from a fully approved EU slaughterhouse of the type that I predict will dominate the trade. Tracing sources of infection will become inestimably more difficult and the break-up of the present food hygiene system, with the introduction of the MHS, will make it more difficult to trace food poisoning. In short, we are not merely looking at a monster in the creation of the MHS, but at a nightmare for public health.
The local authority system, for all its faults, was not broken, although it may have needed some fine tuning in keeping with progressive demands. Sadly, however, one cannot expect local authorities, pressed as they are to meet their statutory responsibilities in many fields, suddenly to step in and bail out the Government by resuming a responsibility so summarily removed from them.
Yet a system is needed to enforce the regulations, which necessarily and rightly flow from EU directives on meat hygiene. The interesting thing about the abomination of a system that the Government have introduced under the Fresh Meat (Hygiene and Inspection) Regulations 1995, is that it makes the option of opting out of the EU regulations more attractive than it otherwise would have been to many people. There are those who say that we should opt out for ideological reasons. Others are saying that we should do so because the system is such a mess.
Given that the EU is reviewing the meat inspection system to bring it into line with more modern systems of risk assessment, there is scope for returning the responsibility for inspecting their own produce to the meat traders, leaving the regulatory officials the simple task of monitoring systems in the same way as they are monitored for the rest of the food industry.
I conclude with this appeal to the Minister: pursue that self-regulatory line in Europe, pressing for the development of systems that will make the MHS redundant as soon as possible. She would thereby be doing a great service to the economic health of the fresh meat industry, the jobs of people employed in it and, more importantly, to the health needs and wealth of choice of the meat-buying public.
11.25 am
Mr. Nicholas Winterton: I congratulate the hon. Member for Knowsley, South (Mr. O'Hara) on obtaining this debate. Having listened carefully to everything that he has said in the past 25 minutes, I must tell my hon. Friend the Minister that I find it difficult, if not impossible, to disagree with anything. The hon. Gentleman has spoken the truth and put forward the case

941
on behalf of the meat industry and I endorse not only what he said, but his request that that monstrous edifice and organisation in York be abolished at the earliest possible date, given all the unnecessary on-costs that it carries.
Macclesfield has long-standing historical connections with the farming and livestock industries. There is a splendid market at Chelford, which is owned and run by Frank R. Marshall—a company that has been in business for more than 100 years. Another market is on the borders of my constituency, lying in that of my hon. Friend the Member for Congleton (Mrs. Winterton), who is away on an Agriculture Select Committee visit—otherwise she would be here supporting the views expressed by the hon. Member for Knowsley, South. That cattle market is owned and run by Whittaker and Biggs.
I have regular contact with small, private butchers, who are members of the Macclesfield and District Butchers Association—an organisation that still exists despite the tremendous competition from the superstores, such as the Tescos, Safeways and Sainsburys of this world. Funnily enough, I am going to its annual dinner and dance in only a few weeks' time. I applaud the role that the small, family butcher and the small and medium abattoir play in the life of the farming community and in that of many rural towns and villages.
Macclesfield is also home to a most excellent slaughterhouse, operated by TTS Meats on the Hurdsfield industrial estate. It is on behalf of that slaughterhouse, those who own it and supply it, those who are employed there and those who ultimately benefit from the high-quality products that it provides for customers that I have been conducting an on-going and determined correspondence with my hon. Friend the Minister and the Department for a considerable period of time. I am deeply concerned about the significant and adverse impact that dramatic over-regulation and excessive—I really mean that—administrative charges have imposed on that slaughterhouse and other small and medium slaughterhouses.
My passion for deregulation is well known to the House. It is a passion that I had been led to believe was shared by my colleagues in the Government. I despair of the way in which the Meat Hygiene Service was set up by MAFF and of how it has operated.
Abattoirs are singled out for extra regulatory controls, unique in the food industry: the presence of full-time public sector/agency officials to inspect the supervised hygiene procedures for meat and to apply what I would call a "health mark". They are also required to pay an inspection levy that enables the MHS to recover the costs of the health controls. The hon. Member for Knowsley, South mentioned that £54 million has to come out of the industry each year.
All other food businesses are essentially self-regulating. Operators take responsibility for compliance with regulations under the food safety legislation without having to pay direct enforcement costs. There is no evidence that that way of operating is anything other than successful. For slaughterhouse operators, the cost of funding public sector/agency meat inspectors has increased considerably and resulted in controversy, anger and resentment throughout the industry. I do not think that I can be contradicted when I say that the industry is totally opposed to what has happened.
942
Millions of pounds are involved annually in meeting this hidden but unavoidable tax, which leaves the British slaughterhouse industry at a competitive disadvantage in Europe—a point eloquently made by the hon. Member for Knowsley, South. That threatens to drive it out of business altogether. Many hon. Members could name slaughterhouses that have gone out of business, to the disadvantage of the agricultural industry and of the communities in which they were located.
I refute absolutely the argument that the current punitive regime of inspection and fees is necessary on public health grounds as my hon. Friend the Minister will, no doubt, argue in her response. Ministers from her Department frequently come before the House and assure us, I believe rightly, that British meat is safe. She has said that time and again in recent weeks and I agree whole-heartedly with her. It is safe. However, that is not because of the bureaucratic empire that has been built and financed by sucking the blood of smaller businesses, but because most operators are responsible in their approach to hygiene and public health. They know that that is their duty and that they will suffer sanctions if they are not responsible. They know that the customer, Mr. and Mrs. Citizen, has never been more aware of, or demanding about, food safety issues and they respect that.
Meat hygiene legislation is founded on two fundamental myths. The first is that the slaughtering stage of the meat production chain presents special health risks that can be eliminated only by the full-time presence of public officials. The second is that abattoir operators, uniquely in the food industries, are either incapable or irresponsible in their approach to the introduction and implementation of adequate control measures. Neither of those misrepresentations can stand close scrutiny, but, until this debate, they have never been challenged on the Floor of this House.
In a food scare climate, which frequent outbreaks of mad media disease have exaggerated and misinformed ever since the first salmonella salvo from my misguided hon. Friend the Member for South Derbyshire (Mrs. Currie), public officials with jobs and empires to protect have shown even less inclination to question their purpose in life. Fresh meat is a low-risk food and current hygiene legislation has been demonstrated to have nothing to do with health control.
The greatest risk in the food chain, to those who know anything about it, is not slaughterhouses but the way in which cooking, preparation, storage, display and serving of food are undertaken. The wealth of scientific evidence to support that view was ignored by the House in 1992 when the meat hygiene regulations were introduced. It was against the background of sensational and irresponsible reporting by the media, faulty technology and a questionable law that the creation of a centralised meat hygiene service was pursued—wrongly, in my view. It is not surprising that dissent, confusion, anger and frustration have followed.
The regulations are not only unnecessary but, I say in support of the case of the hon. Member for Knowsley, South, anachronistic. They belong to another age and have no part in a modern society. Fresh meat is not a hazardous food. The sensible measures that are required to produce safe, good-quality meat are well within the capability of competent butchers. Abattoir operators can achieve the

943
necessary standards in the context of the Food Safety Act 1990 without being singled out for trampling under the iron heel of Meat Hygiene Service charges.
Today, that iron heel demands that if an abattoir has enough turnover to keep an inspector occupied for only one hour a week, the operators nevertheless have to continue to pay for 40 hours' inspection charges. Such blatantly unfair practices, ridiculous overcharging, unacceptable levels of inspection and total lack of consultation have led to turmoil in the industry. Responsible business men and women are refusing to meet the unreasonable bills that they are being sent. I hope that my hon. Friend the Minister will not ask whether I support such action. I perhaps would not give a direct answer but I fully sympathise with them and believe that they have a very good case for taking that action.
Abattoirs faced, as the Minister knows, an immediate 25 per cent. increase in inspection charges when that monstrous body, the MHS, wrested responsibility from local authorities, to which I pay a tribute for the role that they previously played in the industry. On a turnover of £3 million a year, a typical slaughterhouse faces inspection charges of a staggering £50,000 annually. Businesses cannot survive in such a climate.
Furthermore there is patchy commitment on the part of the service to the implementation of the rules. That was referred to in a number of cases mentioned by the hon. Member for Knowsley, South. Responsible traders, who feel morally obliged to comply with regulations that require massive investment, are understandably bitter when they see the Meat Hygiene Service in other areas fail to take action against those who flout the regulations. While we have these regulations and this monstrous body, let the regulations be evenly implemented throughout the country. I do not like to look to Europe too much or too often but let us consider the charges that apply on mainland Europe.
It is high time that there was a root and branch reform of the Meat Hygiene Service and, what is more, of the principles upon which it is based. I hope that my hon. Friend the Minister, in replying to the debate, will agree to such a review in addition to the request made by the hon. Member for Knowsley, South. I hope, too, that other hon. Members, perhaps those who serve on the Agriculture Select Committee, will consider this important matter and take steps to save our abattoirs before they are dismembered on the butcher's block of excessive bureaucracy.
11.38 am
Mr. Paul Tyler: I congratulate, as will the whole House, the hon. Member for Knowsley, South (Mr. O'Hara) not only on bringing the matter before us but on the unstinting way in which he has examined the problems inherent in the Meat Hygiene Service. I hope that the Minister will note that any issue that brings together the hon. Member for Macclesfield (Mr. Winterton), the hon. Member for Knowsley, South (Mr. O'Hara) and myself must be of wide significance in rural areas. I want to deal briefly with three specific issues and underline the points already made by other hon. Members.
My first point concerns the rationale for setting up the Meat Hygiene Service. At the time, there was some misunderstanding and misapprehension—it was thought
944
that the MHS in its present form was set up at the direct instigation of the European Union and the European Commission. Nothing could be further from the truth. On 5 April 1995, in the Fifth Standing Committee on Statutory Instruments, the Minister was good enough to say that that was the case. The MHS is a British organization—it is the product of the thinking of the Ministry of Agriculture, Fisheries and Food. It is not some wicked Brussels bureaucratic plot.
As the hon. Member for Macclesfield has said, it is significant that other parts of the European Union have adopted different techniques, mechanisms and institutions to fulfil their obligations under the treaty of Rome and the directives. We need to know today—we pressed the Minister on this in Committee and did not get a wholly satisfactory answer, although I admit that that was because the institutions were comparatively new—what the comparable arrangements are in the other 14 states, as they now are, and if they are as expensive, as bureaucratic and as burdensome as the hon. Members have said. What is the competitive position in the so-called single market?
The hon. Member for Knowsley, South referred to the way in which the MHS has been set up and its responsibilities to its customers, to Parliament and to the nation. I repeat the statement made by the Minister in answer to a number of our questions in the Committee. She said:
"I reiterate that the MHS is answerable to the Minister, who is ultimately answerable to Parliament. That is the line of communication. There is therefore no question of its being a stand-aside quango which is unaccountable and can go its own way".
Through the Minister, the MHS is answerable to the House—that is why the debate is vital and timely. It is an opportunity for the Minister to answer for the MHS. Note again: there is no question of the MHS being answerable in any sense to the bureaucrats of Brussels.
It is extremely important that we acknowledge the debt that we all owe to Christopher Booker, who has also considered this issue carefully and has identified the extent to which the responsibility lies fair and square with Whitehall. This problem was home grown, within a few hundred yards of this building. It is nothing to do with Brussels.
Secondly, I know that the Minister and the hon. Member for Taunton (Mr. Nicholson) will share my concern at the way in which, over recent years, the regulations—not just since the MHS has accelerated the process—have impinged on the smaller abattoirs in south-west Britain. The same may be true in Wales and in other parts of the United Kingdom, with which I am not so familiar.
In Committee last year, we were able to demonstrate, using the Meat and Livestock Commission's figures, that the reduction in the number of abattoirs had been accelerating as the regulations came into place in 1992. That acceleration had increased. I hope that the Minister will be able to give us the latest figures for the number of abattoirs. It is not the throughput but the number that is important. That is what is geographically significant.
Mrs. Browning: In the past three years, 51 abattoirs have closed. From 1971 to 1992, when the regulations on fresh meat came into force, 62 abattoirs per year closed. That is a significant difference.
Mr. Tyler: I am grateful to the Minister. Clearly, the fact that closures have occurred and are continuing since we raised this issue with her in Committee last year must be a matter of real concern.
Mrs. Browning: In three years, 51 abattoirs have closed, compared with 62 closures per year from 1971 to 1992. That is a significant reduction.
Mr. Tyler: That is precisely the point that I was trying to make. In Committee last year, the Minister gave us assurances that that trend would not continue. It is disturbing to find that it is, and at the time when—I think that the Minister, with her south-west experience, would be with me on this—greater and greater concentration of abattoir facilities inevitably leads to longer journeys. We all know, and she knows better than anyone, from the problems with the new regulations on the welfare of animals in transit—apart from the export problems with which we are all familiar—that we must staunch the wound, and stop any more smaller abattoirs closing. The centralisation of facilities is damaging in that wider sense.
Thirdly, on the charges, the Minister said:
"The new fresh meat regulations include a number of minor changes designed to reduce compliance costs."—[Official Report, Fifth Standing Committee on Statutory Instruments, &c., 4 April 1995; c. 7–23.]
If that is true, either they have not worked or other increases in the cost regime have outbalanced that. As the hon. Members for Macclesfield and for Knowsley, South said, in some cases, the overall cost increases are dramatic. I suspect that, at the core of this, is again the fact that Britain has insisted on using expensive, skilled but utterly inappropriate methods for the purpose of inspection. The official veterinary service is not the right organisation to be employed on such an exercise. I hope that the Minister will tell us what is happening in the other 14 states. Are comparable professionals, at comparable cost, being used?
I was not there but I understand that the Minister of Agriculture, Fisheries and Food spoke at the Conservative party's Blackpool conference and that the emphasis of his speech was that he was declaring war on expensive red tape in his Department. Some might say, "16 years too late", but never mindx2014;that is good. I want to know whether this particular example of expensive Ministry of Agriculture, Fisheries and Food gold plating of what was given to us by agreement with the European Union has resulted in excessively burdensome costs on all parts of the industry, as the hon. Member for Macclesfield has said. Surely, if there is a war on red tape, this is a good place to open the first front.
11.46 am
Mr. Nicholas Baker: I welcome the debate. The hon. Member for Knowsley, South (Mr. O'Hara) was wrong on costs. He ignored the need for standards and much of the debate has ignored the fact that British people require standards, to which my hon. Friend for Macclesfield (Mr. Winterton) referred, because of the way in which they have been frightened about meat eating. Clearly, the way in which the Meat Hygiene Service is working in practice in his constituency is different from the way that it is working in mine, and I am sorry to hear that. Some of his predictions were imaginative, speculative and—I hope and believe—wrong.
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The figures that I have are that the total cost of providing the inspection service in 1995–96 is expected to be just over £35 million, compared with the previous local authority arrangements, which cost £45 million. That is a greater saving than was promised to us in the first place. Of course, I should like that cost to come down, but it is an improvement on what we had before.
Given that my experience of the MHS is different from that of my hon. Friend, I asked the National Farmers Union in my constituency what its experience is. It tells me that the work relationship between the MHS and NFU members and abattoir owners is generally good. It is impressed by the openness with which the MHS operates. There have been relatively few complaints from owners of abattoirs. I will discuss an abattoir in my constituency later, so I am familiar with that side of things.
In most of the debate so far, hon. Members have ignored the fact that the previous arrangements involving local authority inspections were severely unsatisfactory. They not only cost the business community overall a lot, but provided uneven and different standards in different parts of the country. Different arrangements prevailed.
Like other hon. Members, I regret today's climate. Like the Irishman, I should like to start my way to Dublin from somewhere else. Nevertheless, we must recognise that the old system of regulating and inspecting meat provision was unsatisfactory, unfair and did not produce results with which the consumer would ultimately be satisfied.
Mr. Christopher Gill: Will my hon. Friend expand on his last statement, that the old system was unsatisfactory? It is easy to make such comments, but in that instance, he needs to provide some proof or evidence that the old system resulted in an unsatisfactory product.
Mr. Baker: I recognise my hon. Friend's expertise and I have no doubt that his direct experience is different from ours in the south-west, but it is the considered view of the National Farmers Union in my part of the country that the standards that were applied were different and that different abattoirs had to conform to widely differing standards—a practice to which, understandably, they objected strongly.
The Sturminster Newton abattoir in my constituency, with which my hon. Friend the Minister has been closely involved, provides an excellent service to the farming community and to the meat and butchering trade, and it has been affected by the regulations. They are a considerable hurdle for business to overcome. I must record my gratitude, and the Burden family's gratitude, to the Minister for the way in which she has handled the case. In the special circumstances, she felt it right to give a further derogation from those regulations to enable that business to renew itself.
Like me, the Burden family do not like regulations, but they recognise that today they must provide a first-class service. They want to achieve the best standards possible and, in so doing, do not want to pay more than necessary. They are undertaking a major fund-raising exercise to build a new abattoir. They want to take their business into the next century, and they want to export meat. They want to achieve the oval stamp.
There is a great market for the Burden family's beef, and for other meat, in the third world. That market will not be available unless the meat achieves the highest

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standard and the family need time to ensure that their factory meets those standards. They are grateful to have been given that time. The family recognise, albeit reluctantly, that if they want to compete, to provide a good service to the farming community and to export their product, they must achieve the highest standards.
Why are standards necessary? It is all very well for the hon. Member for North Cornwall (Mr. Tyler) to say, "Let us go to Europe and discover what other standards apply." Although that is a useful exercise, we start with the British consumer, who demands very high standards.
I agree with my hon. Friend the Member for Macclesfield that, regrettably, the British consumer has been panicked by a combination of mad professors and other people with other interests into being frightened of eating meat. Therefore, at least for the foreseeable future, we must ensure that standards, and no doubt even bureaucracy, exceed what we would like them to be ultimately. I concur with the hon. Member for Knowsley, South, who wanted self-regulation, but that is light years away. I wish that it were nearer, but it is not.
I conclude by quoting to the House an example from Dorset, which may be of interest to the hon. Member for North Cornwall, of the way in which panic and irresponsible behaviour operates on the British consumer in a way that it probably does not operate in any other country in Europe. Ten days before the end of the winter term, Dorset county council, under Liberal Democrat control, imposed a temporary ban on beef products in schools, not because new evidence had emerged—it had not—but because of scare tactics. The media were at work. One or two mad professors had made pronouncements. It was alleged that there had been
"lots of requests from parents"
for the ban. Further inquiries revealed that a total of six letters had been received.
The ban had a devastating effect on the farming community. There was, I should add, no ban in old people's homes or anywhere else, only in schools. As the Dorset Evening Echo said, that was a "knee-jerk reaction" by the Liberal Democrats, and it was very much to be regretted. The Spongiform Encephalopathy Advisory Committee continued to state throughout that time that there was no evidence of linkage.
About two weeks ago, the ban was halted and the decision was changed. I welcome that. That step was taken as a result, not of new medical or health evidence, but of pressure and of a recognition that damage had been done to the farming community. Irresponsibly, a highly damaging panic was stirred up, and that is not an isolated example of the fears that can be aroused by people who appear to believe that it is in their interests to do so. There are more mad cows in county hall in Dorset than in all the cattle herds of North Dorset. I deplore that.
I hope that my hon. Friend the Minister will tell us how she can reduce costs and bureaucracy—an aim with which I am entirely in sympathy—while maintaining across-industry standards. I was disturbed to hear suggestions earlier that standards were uneven, even under the new provisions. British meat is a first-class product. Our producers want to sell on the world markets. High standards of safety are required for public protection. I know that my hon. Friend the Minister understands that, even if others do not.
11.56 am
Mr. Ieuan Wyn Jones: I hope that the hon. Member for North Dorset (Mr. Baker) will forgive me for not following him into his little difficulty with the Liberal Democrats. I shall turn my attention to the core subject of the debate, which was expressed well by the hon. Member for Knowsley, South (Mr. O'Hara), who has done us all a great justice by initiating the debate. It is important that the House recognises that there is considerable and widespread concern at the way in which the Meat Hygiene Service operates, the costs of that service, which are now evident, and the impact that they have not only on the abattoir industry but on the farming community generally.
I know that the Minister is aware that it is necessary that several outlets should be available to farmers. As other hon. Members have said, a vast number of small abattoirs have closed. The Minister may be able to tell us that the rate of closure is slowing, but some are still closing, to the detriment of the agriculture industry.
The Minister knows that, in sparsely populated rural areas far from a marketplace, some abattoirs have great difficulty attracting the right level of throughput from their local community throughout the year. At some times of the year—in my area, from January to April, before the lambs come on the market—they have to bring in animals from other parts of the United Kingdom, which is an increased cost. It is necessary for employment to be maintained in the abattoirs throughout the year. Abattoirs are an important source of local employment. Their difficulties have been compounded by the substantial increase in costs that has confronted them as a result of the introduction of the Meat Hygiene Service.
When I spoke to managers at the abattoir mentioned by the hon. Member for Knowsley, South—Cig Môn Cymru Ltd.—they predicted that their costs would increase by between 50 and 55 per cent. when the service commenced. In January 1995, they gave me an estimate of what they thought the cost of meat inspection and veterinary visits would be. Some people thought that they were being pessimistic and that the level of charges would be substantially lower. When the Government introduced the concept of the Meat Hygiene Service, it was on the basis that it would be cost-effective and reduce the overall burden on the industry.
In March 1995, the abattoir company came to me and said, "Our predictions were right. Our costs will go up 50 per cent. because we have been told by the Meat Hygiene Service what our costs are likely to be". I have been in regular contact with the Welsh Office, which is responsible for agriculture in Wales, about the level of charges. I have been told that there will be consultation between MHS officers and each abattoir to determine the level of cost for each abattoir and whether it can be justified.
Despite the predictions that were made in January 1995, despite the representations that I made in March 1995 and despite the Department's statement that there would be consultation, the January 1995 predictions were absolutely correct. There has been no variation in those charges, and the costs are exactly as predicted.

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I subsequently made representations to the Welsh Office, and I was told that it was difficult to make a true comparison between proposed MHS charges and previous local authority charges. The Minister added in a letter to me:
"Owners may have changed their plants' size or operating hours; the throughput or the types of animals slaughtered may have altered."
I have heard some excuses for price increases in my time, but that takes the biscuit. There had been no change in the type of animals going through the abattoir, no change in the level of throughput and no change in its plant size, but the cost still increased by 50 per cent.
By the end of 1995, even though the industry had been told that there would be consultation and an appeal procedure, and that the service would be cost-effective, charges were substantially higher than they were under the old local authority regime. I agree with the hon. Member for North Dorset (Mr. Baker) that we must have a hygiene service for meat that is of the highest possible standards. People need to be confident that the meat that they eat is safe—but the current system is destroying the industry.
The Government must find a formula that enables abattoirs to be absolutely confident that the meat is safe, yet reduces the burden and cost of bureaucracy that the type of service which the Government have introduced has placed on them. That is absolutely clear. I should like the Minister to acknowledge that the abattoirs which predicted that costs would increase have been proved right and that Ministers did not listen to them. The Government must respond to that. People at the abattoirs have asked me, "Why should we have to pay this kind of charge to the Meat Hygiene Service when there is no competition? We have a service that can charge virtually what it likes. How can we challenge that? The Minister will not listen to us, and the Government will not listen to us. Why don't they introduce a service that has an element of competition in it?"
If someone else can produce a service that is more cost-effective and competitive, it should be considered. I know that the Minister is aware of those issues, and I hope that she will take them on board.
12.3 pm
Mrs. Llin Golding: I congratulate my hon. Friend the Member for Knowsley, South (Mr. O'Hara) on so diligently and eloquently pursuing this further disgraceful episode in the misgovernment of our country. The Government's excuse for taking away the responsibility for meat inspection from local authorities was the desire to avoid the varying standards and costs that applied in different local authorities. The truth is that it was part of their vendetta against local government in general, no doubt brought about by the humiliation heaped upon the Tory party at every local election. As Lord Howe has apologised for getting rid of the Greater London council, so I hope the present Secretary of State for the Environment, the right hon. Member for Suffolk, Coastal (Mr. Gummer), will soon repent for the damage that he has caused the meat inspection service.
My hon. Friend the Member for Carmarthen (Mr. Williams), who has great experience in these matters, put the issue clearly when he said that any problem in obtaining uniformity in pricing and standards could have
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been solved simply by issuing guidelines. The solution is simple. I must tell the hon. Member for North Dorset (Mr. Baker) that there was no reason to create, without accurate and adequate consultation, a new organisation with so many drawbacks and which has aroused fears that, after short-term cushioning, charges will increase substantially, which would speed up the decline in the number of British slaughterhouses, harm jobs and lengthen travel distances for animals.
One of the main concerns expressed about the Meat Hygiene Service was its lack of accountability, and that is still the case. A great advantage of today's debate is that it gives the Minister the opportunity to cast aside some of the secrecy with which the MHS has been shrouded. Perhaps she will tell us when the agency intends to report publicly on its activities. We should appreciate information on cost-effectiveness, throughput, animal health, and enforcement against abattoir operators and meat traders. Will she tell us when we can expect more information so that we can better judge whether the MHS is providing a more efficient service?
Meat products are notoriously open to contamination and the dumping of bad meat. It is essential that effective monitoring arrangements are provided.
Mr. David Atkinson: The hon. Lady will be aware that the total cost of providing the service through local government was about £45 million a year, which is slightly more than the MHS proposes to spend this year. Is she aware that many local authorities subsidise their inspection service? Does she believe that it is right for council tax payers and consumers to continue to subsidise the British meat industry?
Mrs. Golding: The system we now have in place is a costly shambles over which we have no control. Prices can be increased without any consultation or recourse to anyone.
Mrs. Browning: Will the hon. Lady give way?
Mrs. Golding: No; the Minister will have time to reply, and I should like to make some progress.
Mr. Christopher Gill: Will the hon. Lady give way?
Mrs. Golding: No, I will not. There is not much time, and other hon. Members have been waiting to speak.
I should like to examine some of the specific matters which have given local authority associations concern. One of the main bones of contention between local authorities and the Government when local authorities controlled meat hygiene was veterinary supervision of meat plants. The local authorities' view was that environmental health officers were cheaper and more effective than vets.
Local authorities wanted to reduce veterinary supervision, but the Government refused to allow it. However, the Government are now allowing the MHS to reduce supervision—the very thing that was refused to local authorities. Why, oh why, is that? Because the MHS has found it difficult to recruit staff, not least in hiring the appropriate veterinary surgeons to manage staff at slaughterhouses and abattoirs? Is it because the

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Government now understand the problem that high veterinary fees—the basic legality of which are now being studied by the European Court—caused local authorities?
Costs would be even higher if the Government had not made the savings that local authorities wanted, but were not allowed, to make. Will the Minister tell us what the annual cost of the MHS would have been if the savings had not been made, and what the cost is now?
While local authorities and MHS local officials are working together—the MHS is using local authority offices in such places as Smithfield market—local authorities are concerned that the MHS has added to the confusion over food safety enforcement and created gaps. Will the Minister tell us what arrangements the MHS has made to inform local authorities about food health issues in their areas?
Those important issues must be addressed if the public are to receive proper protection. For example, the Association of District Councils has drawn my attention to the issue of illegal slaughter by unlicensed slaughtermen on premises that are also unlicensed. As a consequence, meat is sold that may have been prepared in insanitary conditions. It has advised that:
"Currently the MHS and the State Veterinary Service have the exclusive power to deal with this situation; however, the MHS seems unwilling to take action on incidents which occur outside licensed premises, and the SVS does not have the staff available to respond quickly enough to tackle the problem. The earnest desire of the Association is therefore that L.A's are given comparative powers to the MHS and SVS in order that they are able to adequately protect the public health and safety."
Will the Minister comment directly on that point, which has a bearing on the important subject of bovine spongiform encephalopathy? On 4 April last year, my hon. Friend the Member for Knowsley, South drew attention to the fact that it was local authorities which had pressed a reluctant Government to:
"enforce better procedures for beef carcass splitting in the industry."
Will the Minister confirm what guidance is now issued to MHS staff about BSE matters in general and, in particular, about the enforcement of the new regulations relating to bovine spinal offal?
The Association of Metropolitan Authorities is concerned about the low profile of the MHS and the responsibility of its vets during the BSE scare last year. The AMA tells me that, from a local authority point of view, it is "very suspicious". The AMA has long held and expressed the view that vets are not the right people to be put in charge of meat hygiene. It has said:
"vets are best left looking at the health of animals, and they have insufficient knowledge in detecting unhealthy food. With BSE for example, they won't know once the bovine in killed whether or not the animal carcass is healthy. Similarly their expertise will not be in forming a judgement on whether or not the spinal cord has been properly removed and left healthy meat".
The AMA's view is clear:
"When meat hygiene was left with local government, wider enforcement activity was possible. If inspection staff thought `mucky' meat was being produced from unhealthy animals, they would then call on the wider resources of the local authority to help complete their investigations. This is no longer the case."
They are very serious concerns and the Minister must address them.
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There is great concern in the country about BSE, animal health and animal welfare. From the local authorities' point of view, there is little evidence that the MHS is tackling those problems with the vigour that the Government would have expected from local authorities. We seek an assurance from the Government today that they will repair the damage that they have done to our country's food protection service.
12.12 pm
The Minister for Food (Mrs. Angela Browning): I shall begin by picking up some of the points that hon. Members raised during the debate. Throughout his contribution, the hon. Member for Knowsley, South (Mr. O'Hara) worked on the assumption that the Meat Hygiene Service has cost £54 million—which was the figure that he mentioned in the Statutory Instruments Standing Committee. I am astonished that hon. Members on both sides of the House have assumed that that figure is absolutely correct. Any one of them could have tabled a written question in the past few weeks and received an answer from my office as to the exact cost of the service 10 months down the road. The hon. Gentleman's figure is quite inaccurate, as I told him in the Standing Committee. Today, I shall provide the correct figures, which prove that the basis of the hon. Gentleman's argument is flawed and that the allegations made by hon. Members on both sides of the House are totally without foundation.
I shall deal now with the points raised by hon. Members. We consult not just the Federation of Fresh Meat Wholesalers, but the Quality Meat and Livestock Alliance, British meat manufacturers and a whole range of people who represent both large and small companies. The hon. Member for Knowsley, South pointed to regulation inconsistencies between different abattoirs. The system that we operate in this country is based on the hazard analysis critical control point system. So as not to over-regulate them, plants are assessed individually and the amount of inspection required is based on things such as throughput and the need for further inspection.
That system has been welcomed not just by the meat inspection industry, but by whole areas of British industry as a minimalist approach to regulation. In other words, inspection is concentrated on those points in the process and on those premises where it is deemed necessary. We seek to reduce regulation by working in partnership with the abattoir owner. That is why some plants have more inspections than similar plants.
The hon. Gentleman then suggested that we should adopt the European proposal, but the Europeans are considering the system that the United Kingdom has pioneered in that area. Under our system, inspections are different from plant to plant, but regulation is minimal. We do not over-regulate where regulation is not needed. The system also helps plants to recognise the role that they must play to reduce the number of inspections of their premises.
The hon. Member for Knowsley, South also said that the MHS is not subject to Treasury controls. That is not the case: it is subject to both Treasury and National Audit Office controls. I point out to him and to the hon. Member for Newcastle-under-Lyme (Mrs. Golding) that the fact that we are having this debate, in which I can answer for the Meat Hygiene Service, proves that that service is directly accountable to my right hon. and learned Friend

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the Minister of Agriculture, Fisheries and Food and myself. Consequently, I am here today to account to the House of Commons. There could not be a more transparent line of communication between the service's operations and its accountability to this place. I think that the hon. Gentleman described it as a self-financing regulatory authority, but that is not the case. There is a clear line of direct contact, which I welcome.
Many hon. Members mentioned competition in Europe. My hon. Friend the Member for North Dorset (Mr. Baker) made a very telling point, using the example of the small abattoir at Sturminster Newton in his constituency. I have met my hon. Friend and the owner of that abattoir, and I issue an open invitation to hon. Members to meet me, with abattoir owners from their constituencies, and talk about problems in abattoirs and about the details of individual cases.
That abattoir owner came to my office and said, "We want the European health mark. We want to be able to export, because it is a £1 billion industry and we are very good at it." The demands of the marketplace, both at home and abroad, create huge opportunities for those abattoirs that aspire to those standards, that control and the health mark. The industry is asking for that. That is where the industry is heading in the next century, and I am astonished that hon. Members want to see a reduction in the controls that allow British companies to compete.
The hon. Member for North Cornwall (Mr. Tyler) referred to other member countries. Many, such as Ireland, Denmark and Holland, have centralised inspection systems. There is no evidence to suggest that the United Kingdom is disadvantaged commercially as a result.
I shall deal now with the main substance of the debate, as I should like to put the facts to the House. I am very grateful to the hon. Member for Knowsley, South. When the Statutory Instruments Standing Committee debated the regulations which transferred responsibility to the Meat Hygiene Service last April, the hon. Gentleman painted an alarming—indeed, an apocalyptic—picture of the effect that the MHS would have on the meat industry. I am sorry that he chose to pursue that theme in his remarks today because, 10 months down the road, I can provide more information.
I can confirm that accountability was made very clear from the time that the MHS was established. It will produce an annual report after the first year—it is now 10 months old—which will be placed in the Library. There is no question of any secrecy, and it is rather disappointing that the hon. Member for Newcastle-under-Lyme did not know that.
The hon. Member for Knowsley, South predicted that the industry would have to bear overhead costs averaging £20,000 per abattoir and that his constituent, Mr. Morphet, would be charged an extra £30,000. He said that the MHS would have a built-in incentive to maximise its own requirements, that it would drive small and medium operators out of the industry, that consumer choice would be restricted and that prices for livestock farmers would be reduced. The hon. Gentleman even predicted that fewer than 95 slaughterhouses would remain in business by the end of 1995. He will have heard the figure I gave twice, and I hope that the hon. Member for North Cornwall also understood the figure. I told the Committee in April that those accusations were unfounded. This morning, I shall give the House the facts.
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The story of the Meat Hygiene Service is worth telling. When we set it up, Ministers gave it a target of achieving an efficiency gain of 10 per cent. in relation to estimated costs—our figure of £45 million, not that of £54 million given by the hon. Member for Knowsley, South—in 1994–95. We expected the MHS's operational costs, with the 10 per cent. efficiency gain, to amount to £40 million in 1995–96.
We also took the view that it should be possible for the MHS to achieve further efficiency gains in future years, and we concluded that it would be right to make available some financial assistance in the first year to ease the transition to the new arrangements. We therefore made available up to £3 million, for 1995–96 only, and we made it plain, in the House and in another place, that the Meat Hygiene Service would be expected to find the efficiency gains necessary to compensate for withdrawal of that transitional relief after 31 March 1996. In other words, the MHS was required to ensure that chargeable costs in 1996–97 would be less than £37 million—the amount that we expected to be charged for the industry in 1995–96, taking into account the efficiency savings and the transitional relief.
The MHS is now forecasting, just two months before the end of its first year, that its operation costs for 1995–96 will turn out to be £35.2 million pounds. I wish that hon. Members had thought to ring my office or put down a parliamentary question, because the contributions to the debate, including that by my hon. Friend the Member for Macclesfield (Mr. Winterton), have been based on the wrong assumption that the figure was almost double the actual figure. The erroneous figure was produced by the hon. Member for Knowsley, South last year and was perpetuated by him this morning.
Mr. Nicholas Winterton: The Minister is making much play of the actual costs of the MHS. My figures show that, in 1990, local authority costs for a similar service when there were 700 abattoirs and more than 100 poultry plants were £32 million, yet in 1995 the figure for the MHS, when there are only 400 abattoirs—not 700—and a static number of poultry plants, is about £37 million. Will the Minister comment on the statistic quoted by my constituent about his abattoir—
Mr. Deputy Speaker (Mr. Michael Morris): Order. The hon. Gentleman knows that these are short debates, and one question is sufficient.
Mrs. Browning: I hope that my later points will help my hon. Friend.
The MHS is now forecasting that its operational costs for 1995–96 will be £32.5 million. That is an efficiency gain of more than 20 per cent. in the first year, despite the fact that we had charged it to make an efficiency gain of 10 per cent.
Because the European legislation prohibits subsidisation below the level of the so-called Community standard charge, and the MHS charges to many plants are coming out below that standard charge, only £2.5 million of the £3 million allocated to transitional relief will be used. So the total amount paid by the industry in 1995–96 will be some £32.7 million pounds. I appreciate the point that my hon. Friend the Member for Macclesfield made about fewer plants, but we are several years down the

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road and the MHS is charged with additional responsibilities. For example, it now has a very important role in animal welfare in the abattoirs.
Mr. Tyler: In the debate in Committee, the Minister said:
"As far as charges are concerned, we expect them to be no higher next year than they have been in the current financial year."—[Official Report, Fifth Standing Committee on Statutory Instruments, &c., 4 April 1995; c. 24.]
Is she now saying the figures are 20 per cent. lower than expected?
Mrs. Browning: No, I am saying that, because of the 20 per cent. efficiency gains made by the Meat Hygiene Service, there have been considerable reductions, but they may not apply to every single plant because of the point I have just made about minimum charges. When we set up the Meat Hygiene Service, we knew that there were variations in charges. The hon. Member for Ynys Môn (Mr. Jones) gave a constituency example that is a case in point. In some areas, but not all, local authorities subsidised the charges that they levied from taxpayers' money.
That excellent result from the MHS means that some plants have had reduced costs this year compared to what they paid under local authorities. A large red meat plant that paid some £610,000 in 1994–95 will pay around £556,000 in 1995–96—a saving of £54,000. A medium pig slaughterhouse that paid £56,000 in 1994–95 will pay £39,000 in 1995–96—a saving of £16,000. A small abattoir that paid nearly £3,400 in 1994–95 will have a bill of less than £2,900 this year—a saving of just under £500.
As for Mr. Morphet, the constituent of the hon. Member for Knowsley, South, I understand that he has refused to provide the MHS with copies of his local authority invoices. It is therefore difficult to make an accurate assessment of how he has been affected by the MHS, but we believe that in his case the Meat Hygiene Service's charges are likely to be some 20 per cent. lower than he was charged by his local authority in 1994–95. If the hon. Gentleman or his constituent would like to supply me with those invoices so we can make the comparison, we would be very pleased to see them. To date, they have not been forthcoming.
There are also equally impressive savings in the poultry sector. One large plant will save around £75,000 on its 1994–95 bill of nearly £400,000 and another will save nearly £59,000 on a 1994–95 bill of more than £236,000.
We have always acknowledged the fact that, in individual cases, charges could go up under the MHS, because there was a wide disparity in charges under the local authority system. By and large, those who find themselves paying more under the MHS are those who paid well below average before. The industry in total is paying substantially less, and that is a very important point. Also, the charging policy is consistent across the country and the staffing levels on which the charges are based are being adjusted as necessary, following a
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thorough audit in each plant. That is the point that I made to the hon. Member for North Cornwall just now.
I hope that the House will recognise the commendable achievement of the MHS. I pay tribute to the chief executive and all his staff—especially the meat inspectors in the plants—for the energy and the commitment that they have shown in tackling their challenges. However, hon. Members will not be surprised to learn that my right hon. and learned Friend the Minister of Agriculture, Fisheries and Food and I have no intention of allowing the MHS to rest on its laurels. It has done extremely well in its first year of operation, and we shall make sure that next year's targets require the chief executive and his team to keep up that good work.
In practice, the MHS is already delivering in its first year an efficiency gain that we had expected would take more than two years to achieve. It would not be reasonable to expect another 20 per cent. from it next year, but we shall certainly keep pressure up.
Hon. Members have made comparisons between what is done now and what was done by local authorities. As the Minister responsible for dealing with BSE, I have had several meetings in the past year with my right hon. and learned Friend the Minister and members of the meat trade. We have discussed some of the problems that we have encountered in slaughterhouses, including staining and disposal of specified bovine offals and the retention of small pieces of spinal cord in the vertebral column. Those problems did not come to light under local authority inspection.
The general public and the meat industry must be reassured that we now have efficient, uniform inspection carried out throughout the country. When we find a problem, we are able to deal with it by bringing forward measures such as those which we have placed before the House in the past few months. I hope that all hon. Members recognise how important it is, especially in BSE controls, that we have that professional, uniform service so that when a problem arises we identify and deal with it quickly.
The hon. Member for Knowsley, South has had much to say in his local press in the past few days, as well as in his contribution to this debate, about non-payment. If the message from new Labour is "Do not pay your bills", we take note of that. That is a rather familiar theme and I thought that it was an old Labour message. Perhaps it has been forgotten. About 90 per cent. of the MHS customer base of 1,800 businesses—that is slaughterhouses, cutting plants and cold stores—are paying their bills. Those who are not paying are giving themselves a nice little advantage over their competitors while the legal arguments are being pursued.
In the Woodspring case, the judge made it clear in his November statement that there was no reason why payment should not be made while the matter was before the European Court of Justice. In other words, some people are working the system to their commercial advantage while others in the meat industry are working to improve our export trade and build up their businesses. Those people will not carry those who have debts and nor will the British taxpayer. I will pursue those debts through the courts rigorously. I hope that the hon. Member for Knowsley, South will consider exactly what he is supporting when he suggests that people who—
Mr. Deputy Speaker: Order. We must move on.

Pollution (Bexley)
12.30 pm
Mr. David Evennett: I am pleased to be able to raise the important issue of pollution in Bexley borough in this short debate. Pollution is an issue of increasing importance within our society and, in my borough of Bexley, it is causing growing concern. The borough is an extremely pleasant place in which to live and work, and it is certainly a privilege to represent it in Parliament. However, there are important factors at work which are causing increased levels of pollution locally and putting strains on the local environment.
I must stress that pollution is not an issue that divides people on the grounds of political affiliation. I am delighted to see the hon. Member for Woolwich (Mr. Austin-Walker) in his place. Pollution is not restricted to one part of my borough or to that borough in isolation. However, Bexley's problems are greater than in neighbouring London boroughs or in Kent.
Bexley council's environmental agenda document entitled, "A framework for consultation and action" will be debated at a conference on the local environment in Bexley on 10 February. The aim of all in my constituency and across the rest of the borough is—as the document says—
"to ensure that Bexley is a clean, healthy, pleasant and accessible Borough for people to live and work in and to visit."
There are many interesting sights in the borough to which people can come, and we welcome visitors from other parts of the country and abroad.
As one of the borough's representatives in Parliament and a resident of Crayford, I wholeheartedly endorse the sentiment contained in that document. I am determined to push hard to ensure that local pollution is reduced. Although education must be a factor, we must look to local and central Government, as well as local industry, to play leading roles. Today I am looking particularly to my friend and colleague the Minister, the hon. Member for West Hertfordshire (Mr. Jones), to take on board my concerns and to ensure that his Department plays its full part in the fight against increasing levels of pollution in my borough. We need more help in the future.
Air quality in Bexley borough has been monitored for the past 10 years. Originally, the late and certainly unlamented Greater London council and the London scientific services maintained a constant monitoring station at Crossness sewage works in the north of Bexley. That unit measured sulphur dioxide, carbon monoxide, nitrogen oxide and ozone—in other words the major industrial and road transport air pollutants. It produced annual reports.
Bexley London borough has a monitoring station located in my constituency at Slade Green, which measures all the pollutants assessed by the old GLC station, as well as the levels of respirable dust in the air—known as PM10. Bexley's station commenced operation in 1992, and since 1994 has been affiliated to the Department of the Environment's national automatic air monitoring network. Reports are produced daily, quarterly and annually.
In addition, pollution is monitored in Bexley at a station established in Belvedere in August 1995 by Barking Power plc, to measure air pollutants that may be emitted
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from the combined cycle gas turbine power station in the London borough of Barking and Dagenham. I am advised that that monitoring station, established in accordance with a planning condition, will be transferred to Bexley council in 1999.
We have considerable monitoring of local air quality, and the results suggest that, although Bexley experiences air quality similar to that of other urban areas, there is an additional problem of air pollution from specific industrial sources in the east Thames valley. Our area appears to have higher levels of pollution.
The results of monitoring show that the local levels of sulphur dioxide pollution exceed reasonable standards. The Department of the Environment's panel on air quality standards has recommended a protective standard of 50 ppb measured over one hour. However, the local measurement has recorded a maximum considerably higher than that for many hours over the past year. Therefore, the level exceeds the Department's recommendation.
The reasons for that lie with the power stations and large industrial processes to the east of Bexley, over which the local council has no control. Bexley can monitor, complain and highlight, but it does not seem to have any power to take action.
It is alleged that particles in the air are responsible for the increasing number of bronchial and asthmatic illnesses in northern Bexley, particularly in Erith, Belvedere and Thamesmead. Local measurements suggest that the guideline of 50 μg/m3 of air, measured as a running 24-hour average, is frequently exceeded. A peak 24-hour running average would be 90 μg/m3 in Bexley. That is probably associated with local road transport and local power stations. In addition, local road transport, particularly the large and heavy lorries, is responsible for high levels of nitrogen dioxide, which may also exceed the guideline for air quality control set by my hon. Friend's Department.
We do not have accurate figures on this and, although I appreciate that there are statistics and statistics, there is a growing feeling within the council, among local residents, and certainly among the borough's Members of Parliament, that there is a problem. The statistics presented to me by Bexley council's environmental health department give me some cause for concern.
I hope that my hon. Friend will appreciate from the figures and from my concerns that, although I do not wish to be a scaremonger, I am concerned that the levels of pollution appear to be increasing, and seem to be much higher than they should be under the Department's guidelines. I hope that the Minister will take on board the issues and concerns that I have raised.
Mr. John Austin-Walker: The Thamesmead area, to which the hon. Gentleman referred, is partly in his constituency and partly in mine. I wonder whether he has seen the evidence produced by the former director of public health for Bexley, which showed that levels of respiratory illness in the Thamesmead area are far higher than the census economic deprivation statistics suggest. Will the hon. Member also confirm that the former director showed that the level of asthma and

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respiratory illness among children in the area was the third highest in the south-east Thames area, the highest being in the part of the locality that I represent?
Mr. Evennett: The hon. Gentleman is right, and I share his concern. I have seen that report, and I hope that there will be some action to reduce the problems of respiratory illness in that area, particularly among young people.
The provisions of the Environment Act 1995 which relate to air quality management will come into force in 1997. My borough of Bexley has already made it known to the Department of the Environment that it would like to take part in the pilot project to test the implementation of the new statutory controls contained in the Act.
The pilot scheme is due to commence soon—perhaps as early as April. I hope that Bexley will be one of the councils allowed to participate in it. I urge the Minister to give a favourable response to Bexley's application, because of the concerns in the borough about the level of air pollution.
To add to the pollution problems caused by local industry, the power stations and the east winds that seem to blow pollution into the borough, the local environment is also threatened by an application by PowerGen and Cory to build a huge waste energy incinerator at Belvedere in northern Bexley. The proposal, which is strictly the responsibility of the Department for Trade and Industry, has been refused once, but if it is allowed to be built, that could result in further pollution problems for my area.
The application has been refused by Bexley council, and it is opposed by all local people, organisations, political parties, community groups, the hon. Member for Woolwich (Mr. Austin-Walker), myself and others. I hope that there will be a public inquiry to allow local views to be aired more fully.
Mr. Austin-Walker: The hon. Gentleman referred to the threat from the Cory-PowerGen proposal. Does he agree with the statement of the Baptist minister for Belvedere, Mr. Goode, in his letter to the DTI? He said:
"to knowingly build this plant in an area already experiencing such acute problems with pollution and its resultant illnesses, would be scandalous and irresponsible. An act of environmental vandalism towards the residents of Belvedere and beyond."
Mr. Evennett: I certainly endorse that view, although I do not like the emotive language. I would not use such language.
The issue of refuse disposal is important. Unfortunately, because of shortage of time, I was not called to participate in our recent debate two weeks ago. However, I did sit through the whole debate. I was encouraged by the Minister's speech, and by the general tone of the debate. Of course there is a need for more recycling—a message that came loud and clear from both sides of the House. However, I believe that we need local solutions to local problems.
Bexley council and the residents are keen to have local solutions to Bexley's refuse problems. What they do not want is to become a home for huge amounts of waste from neighbouring boroughs—and possibly, in time, other parts of Europe. With the PowerGen-Cory proposal, some
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1.2 million tonnes of refuse will be required to operate the vast incinerator, yet only 7.5 per cent. of that would emanate from Bexley borough.
Although some of the refuse would travel on the Thames, the rest would travel across the borough and add to the pollution on our already overcrowded roads. I strongly objected to the proposed incinerator on many grounds, but in particular on the environmental issues and the threat of increased transport pollution. I look forward to a public inquiry into the matter.
We had hoped that the excellent proposals for the development of the Thames gateway would mean a rejuvenation and regeneration of the Thames riverside, with new clean industries. For far too long, the potential of the area has been under-utilised and damaged by the dirty and polluting industries of the past. Thamesmead, Belvedere, Erith, Slade Green and Crayford look forward to new investment, jobs and homes as part of the initiative. A waste-to-energy incinerator was not what we had in mind to improve the area. I hope that it will not prejudice the development of the clean industries and new homes and jobs that we want in the area.
I pay tribute to the organisation BADAIR, set up to lead the campaign against the PowerGen-Cory incinerator proposal, and in particular its former chairman Alec Tapper and vice-chairman Commander John Mankety—local people, determined to improve the local environment.
Having dealt with incineration and the problems associated with emissions from that, I want briefly to deal with pollution from lorries and cars. The problem of increasing traffic and the environmental consequences of exhaust fumes is widespread across London; it is not just an issue in my borough. However, the position is exacerbated locally because of the inadequacy of local roads and the increasing number of vehicles travelling through residential roads in Crayford, Bexleyheath and Bostall in particular. Huge lorries thunder along roads that were never meant to take them.
For example, Crayford has become a continuing traffic nightmare, with the stop-start progress of cars and lorries emitting exhaust fumes causing more pollution. There has often been near-gridlock in the town centre, with exhaust fumes causing a cloud over the town.
Meanwhile, on the major motorway crossing our borough—the A2—traffic has increased dramatically over the past few years, causing increased pollution and creating more difficulties for those whose homes are close to the road. My right hon. Friend the Member for Old Bexley and Sidcup (Sir E. Heath) has raised the problems experienced by his constituents with our hon. Friend the Minister for Transport in London.
The road now ranks among the busiest in the United Kingdom. At times, it is so congested that cars and other vehicles travel at low speeds, stop-start and create more pollution. The road is fairly busy for some 20 hours a day, and has changed out of all recognition from when it was opened.
Traffic from the A2 causes great environmental problems across the whole of the borough. While I realise that that is not the subject of today's debate, and needs to be pursued with the Transport Minister, it nevertheless highlights the problems of Bexley caused not just by industry but by traffic passing through the borough to other destinations and by the heavy lorries that come to

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Bexley's industrial areas. The increasing frequency and size of lorries and the growth in the number of car journeys in the area contribute to the poor air quality, which is being monitored by Bexley council.
I urge my hon. Friend the Minister and his Department to do all they can to improve air quality and reduce levels of pollution across London, but especially in Bexley. In the short term, I believe that Bexley has a strong case for joining the pilot scheme and for monitoring the new statutory controls under the 1995 Act. I also believe that the Department's overall responsibility for the Thames gateway initiative will allow it to help to invigorate and rejuvenate the area as part of a riverside community, with environmentally friendly industry, in which it is a pleasure to live and work.
Our area has great potential, but it needs help from the Government and the local authority, as well as local industry, to kick-start the development. We need clean industry and cleaner air for the residents, the visitors and everyone who works in the borough of Bexley.
12.47 pm
The Minister for Construction, Planning and Energy Efficiency (Mr. Robert B. Jones): I welcome the opportunity to respond to the debate, as it enables me to pay tribute to my hon. Friend the Member for Erith and Crayford (Mr. Evennett), who has waged an energetic and single-minded campaign to improve the environment of his constituency. He is a respected campaigner on this and many other issues, and Bexley is fortunate in having him as a champion.
As my hon. Friend said, Bexley contains one of the air pollution monitoring stations belonging to the Department of the Environment's automatic urban monitoring network. It shows that Bexley experiences levels of pollution that are, on the whole, not unusual for any urban site in the United Kingdom. For example, levels of nitrogen oxides can approach, although they rarely breach, the Department's poor air quality threshold. It was breached for only a single hour in each of the last two years. Levels do not approach the European Community's limit value, which I remind the House is 200 μg/m3 and the 98th percentile of hourly means over a calendar year.
We recognise that levels of sulphur dioxide have occasionally caused poor air quality, as defined by the Department's air quality banding. The poor air quality threshold for sulphur dioxide roughly coincides with the World Health Organisation's guideline value. This level was exceeded in Bexley on four days in 1994, and on 13 days in 1995.
That is the picture of air quality in Bexley. The question of sulphur dioxide apart, it largely reflects the air quality to be found in other urban sites. The Government recognise that there is nationwide concern over growing evidence on the health effects of some pollutants and the desire to improve living conditions—particularly in our cities. The Government are determined to take effective action where the need to bring down levels of air pollution has been identified. I will outline the broad framework of pollution control.
The United Kingdom already has in place one of the most sophisticated industrial air pollution control systems in Europe. It was introduced in the Environment Protection Act 1990, and consists of two elements—integrated pollution control and local authority air pollution control.
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Integrated pollution control applies to large industrial installations and is currently administered in England and Wales by Her Majesty's inspectorate of pollution. Its authorisations set limits on emissions to all environmental media from such installations. Local authority air pollution control, which is administered by the relevant local authority, covers emissions to air from small and medium enterprises.
In both systems, authorisations are based on best available techniques not entailing excessive cost—BATNEEC—for the industrial process in question, and are reviewed every four years, so that changes in the available technology can be taken into account. Across the UK, some 2,000 processes are authorised under integrated pollution control, and there are about 13,000 local authority air pollution control processes nationwide. The figures for the London borough of Bexley are five IPC processes in operation and 31 LAAPC processes. I will refer later to industrial emissions in Bexley and the east Thames corridor.
Emissions of sulphur dioxide and smoke from domestic households are controlled through the smoke control areas system, which was introduced in the Clean Air Act 1956. Bexley has completed its smoke control programme, so 100 per cent. of households in the borough fall within smoke control areas.
As to pollution from transport and road traffic in particular, emissions from the transport sector are mainly controlled through European Community legislation—specifically, through emission standards on new vehicles sold in the Community and standards on the quality of automotive fuels. Standards that make compulsory the fitting of catalytic convertors to petrol cars took effect from 1993. Stricter standards for vehicles have been agreed for 1996–97. The effect of the standards already in place will be to bring about a continued dramatic reduction in emissions of traffic-related pollution well into the next century.
We recognise that the steady rise in the size of the vehicle fleet will militate against that downward trend. It is estimated that, on current policies, emissions will begin to rise again around the year 2010. If we are to achieve and maintain our air quality targets and objectives in the face of transport fleet growth, further progress is needed in reducing average emissions per vehicle.
The European Commission is expected to bring forward this year new proposals for vehicle emission and fuel quality standards for the year 2000 and beyond. We shall be looking to agree a positive, cost-effective package of measures that will bring down emissions further and bring us closer to meeting our air quality objectives.
As cleaner vehicles come to predominate in the fleet, we are also tightening up the MOT standards, to ensure that we pick up on catalysts that have stopped working efficiently, and that vehicle owners keep their vehicles properly tuned. In addition, we are tackling the volatile organic substances given off when tankers load and unload at fuelling stations.
Reducing pollution cannot be left entirely to technological fixes. Air quality can also be improved through changes in patterns of behaviour. We are encouraging public and private fleet operators to act in an environmentally responsible way, and we are providing the public with information about greener motoring habits.

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To deliver a sustainable improvement in air quality in areas where quality currently exceeds the levels that are considered desirable, a national framework of air quality objectives and assessment, and management practices within which the right balance of policies can be set, are needed. The Environment Act 1995 committed the Government to producing a national air quality strategy.
That strategy, which we will issue this year, will set out the framework. It will be based on sound scientific advice about the health and other effects of air pollutants—recommendations from the independent expert panel on air quality standards and information from other sources, such as the World Health Organisation, which will provide the technical expertise to provide that scientific basis; clear national standards and objectives for air quality, to be achieved by a given timetable; a national strategy backed up by flexible and cost-effective action at a local level, through the system of local air quality management areas; a commitment to keep Government policies under review, to ensure that progress is maintained; and clear and accessible information for the general public and advice on how they can help. We need to keep the strategy flexible, so that we can continue to find cost-effective solutions and to ensure that as further air quality targets are agreed in Europe, the mechanism can encompass them.
The work of laying the ground for the air quality strategy has already started. It is fairly clear that a single solution for the whole country is unlikely to be cost-effective. To ensure that action is not unduly burdensome or bureaucratic, problems must be solved where they occur—whether across the whole of Europe or in one congested high street. To ensure that solutions can be put in place, a new legal structure for local authority action is needed.
The Environment Act 1995 requires local authorities to review their air quality against the standards and targets in the strategy. Where targets and standards are not going to be met, an air quality management area will be designated and a more thorough assessment will be made, to work out where the problems are, how bad they are and what is causing them. The local authorities involved will be required to prepare and undertake a plan of action to remedy the situation.
The Government are currently drawing up guidance, in consultation with local authorities, on how they can meet their duties under the Act. Furthermore, we are initiating the first phase of local authority assessment and reviews this year. It will include a Londonwide initiative.
Our aim is primarily to ensure that air quality can brought to acceptable levels and sustained. Local authorities will be free to use all the powers at their disposal in the discharge of their duties under the Environment Act 1995. Those powers encompass the setting of conditions in local authority air pollution control authorisations—which in future must have regard to the forthcoming air quality strategy.
Over the long term, local authorities can bring their planning powers to bear on air quality. Guidance has already been issued to them on ways of lessening the need for private transport through judicious planning.
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I have outlined the Government's national approach to controlling pollution, all of which has great relevance to my hon. Friend's constituency, and I will make a few comments specific to the area that he represents.
As to sulphur dioxide, there are no major processes regulated by HMIP within Bexley that release significant amounts of the pollutant. There are a number of major sources within the wider area, within a 25 km radius. Most prominent among them are the power stations at Littlebrook and Tilbury, oil refineries at Coryton and Shellhaven, and a cement producer at Northfleet. All those processes are to the east and to the north of Bexley, which is upstream of the prevailing winds. It is possible—under certain, infrequent weather conditions—that these processes contribute to the raised levels of sulphur dioxide in the Bexley area.
Nationally, we are committed to a significant reduction in emissions of sulphur dioxide over the coming years. By 2010, emissions should have been cut by 80 per cent. on 1980 levels. That continued reduction is administered under the national sulphur plan and will be delivered largely by increasingly strict conditions in integrated pollution control authorisations, which should mean that the risk of raised levels of ambient sulphur dioxide should also reduce significantly.
In 1992, Her Majesty's inspectorate of pollution commissioned a major study of the environmental impact of all the major industrial releases of nitrogen oxides in the east Thames corridor. A number of processes were subject to application for authorisation and their potential effect was considered. The ensuing report reached the conclusions that existing industrial processes make a relatively small contribution to annual nitrogen oxide concentrations, accounting for not more than 17 per cent. of current levels; each new plant would make only minor additions to the existing levels of nitrogen oxides; and all the releases of the proposed new plants would not threaten the statutory EC directive limit value.
HMIP has used and will continue to use the BATNEEC principle to ensure that state-of-the-art technologies are used to minimise the release of nitrogen oxides and other pollutants, including sulphur dioxide, from the major industrial processes in the area. Of the 10 processes proposed at the time of the study, three are in operation and performing to the required emission standards.
Of the remaining seven, the most significant plants for Bexley are the sewage sludge incinerators at Crossness and Beckton, and the waste to energy plant at Belvedere. The sludge incinerators, which will be operated by Thames Water, were authorised in 1994, and are currently under construction. They have been designed to meet the tight emission standards imposed by HMIP for plants in the east Thames corridor.
Cory Environmental Ltd. was granted an IPC authorisisation in 1993 for a waste and energy plant at Belvedere, designed to treat 1.2 million tonnes of London's waste and to produce 108 MW of electricity. I understand that the prospective operators of the plant have not been successful so far in obtaining planning permission, and it is not appropriate for me to comment at this stage on the application, in the event of any further procedure under the planning regime.

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I hope that what I have said will reassure my hon. Friend that the Government have very much in mind his concern about environmental quality, and that we are committed to the measures necessary to enhance and improve it over the years ahead.

Sustainable Development
1 pm
Mr. Cynog Dafis: I am grateful to the Under-Secretary of State for Wales, the hon. Member for Cardiff, North (Mr. Jones), for agreeing to participate in this all-too-brief debate on an issue of enormous global significance which is of particular relevance to Wales.
It is important to recognise at the outset how far-reaching a transformation is implied by the achievement of sustainability. The principles of sustainability, which are being elaborated at all levels of human society, have been accepted by the Government through their endorsement of the Rio documents and their participation in the process of the United Nations Commission for Sustainable Development, which came about following the 1992 earth summit. I shall recall some of those principles.
First, there is a need for a radically different method of measuring economic success other than gross national product growth—what are called new economic indicators, bearing in mind environmental and social considerations. The second principle is to give resource productivity priority over labour productivity as a measure of progress, which implies major changes in taxation, and taxing pollution and wasteful resources instead of jobs.
Thirdly, there is a preference for the use of renewable resources over non-renewable resources. Fourthly, it is suggested that environmental considerations should be integrated into all decisions on development. Fifthly, the implementation of the proximity principle is recommended, encouraging more localised patterns of production, distribution and consumption. That is some transition.
The European Union recognises the validity of those principles in its fifth environmental action programme "Towards Sustainability" and in the very important White Paper "Growth, Competitiveness and Employment". In the second document, the EU argues that environmental sustainability and the solving of the unemployment problem must and can go together.
The Government have established bodies to advise them and to promote sustainable development. The round table has representatives from business and voluntary sectors. Indeed, last week the second report of the advisory panel on sustainable development, chaired by Sir Crispin Tickell, was published. It reviewed last year's recommendations and considered the next priorities. It is lucid and succinct yet forceful, and it merits very serious attention.
When those organisations were set up early in 1994, a special body on sustainable development was established by the Secretary of State for Scotland, but in Wales, under the former Secretary of State, there was nothing of the kind. To members of Plaid Cymru, who attach importance to Wales as a country in its own right, and do not think of it only as some kind of appendage to England, that was offensive.
Countries will succeed and contribute to the collective welfare of the global community in the extent that they tackle the sustainability issue seriously. It is as crucial as that. The indications are, however, that the Government of Wales—in effect the Welsh Office—is failing in its

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responsibility to put our country, for which it is responsible, on the road towards sustainability: the only basis for true and lasting prosperity in the 21st century.
That is not to say that nothing has been done or that nothing is happening in Wales. Indeed, I am happy to make that point. The Welsh Office organised two seminars—in November 1993 and May 1995—that were attended by representatives of various quangos, local government, the social partners as they are called, non-governmental organisations, and so on. Copies of the minutes of those seminars, which happen to have found their way to my desk, suggest that the seminars were useful enough, but the suggestion that
"a working group which could meet at regular intervals to discuss sustainable development"
seems to have come to nothing. I hope that the Secretary of State will at least support a permanent working group. I shall, however, describe a more radical proposal later.
The absence of any kind of permanent body, or any Welsh Office think tank on sustainable development, raises questions about the local Agenda 21 process in Wales. Local authorities, which are involved in reorganisation, are enjoined to consider sustainable development in producing their local plans. What kind of guidance are they being given by the Welsh Office? Without adequate guidance, how can an all-Wales Agenda 21 evolve? Perhaps the Under-Secretary could enlighten us on the matter.
The business in the environment initiative is being delivered in Wales by the Arena network to assist Welsh businesses in achieving greater environmental efficiency. Will the Minister tell us how the Arena network programme's progress is being monitored and how many businesses have participated in it? I imagine that many businesses in Wales, especially small and medium-sized enterprises, will not even know of its existence. That needs to change.
The Welsh energy project has been acknowledged inside and outside Wales as an important and useful initiative. It produced a five-point action plan for a pilot series of innovative sustainable economic development areas, business development initiatives, the creation of a network of local information centres—I know that that is happening—the encouragement of investment in energy efficiency and the growing worldwide environmental protection market, and the provision of help to local planning authorities. What monitoring is taking place to assess the extent to which the action plan is being successfully implemented?
Renewable energy, in view of the serious pollution and the climatic effects of burning fossil fuels, and of course the fact that those fuels are being depleted, is hugely important, as I tried to show when I spoke in the debate on the Queen's Speech. We in Wales have major resources which could provide significant and sustainable economic development and employment opportunities.
I quote the words of Mr. Mike Brooker, chairman of the environmental study group of the committee organised by the Prince of Wales, which held a very successful seminar entitled "Towards a Sustainable Energy Strategy
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for Wales", which I attended and by which I was very impressed. In his summary of the findings of that seminar, Mr. Brooker says:
"Delegates at the conference—representing industry, environmentalists, politicians and academics—concluded that, although there was a huge amount of complex and detailed information available, there appears to be no coherent strategy to embrace environmental, social and economic issues. Developing such a strategy is an essential pre-requisite to the future management of energy issues.
There was general agreement about the need for change by all the stakeholders,"—
forgive the word stakeholders—
"Government, Power Companies, Planners, Environmentalists Business, Industry and the public at large. The difficulty is creating a focus to establish strategy and precipitate local action. How can we create an Action Plan in Wales?.. Which organisation should oversee the strategy and create delivery at a local level?"
The Welsh Office should have something to say on that last question. Is the Welsh Office not the responsible organisation? What is it doing to ensure the creation of such a strategy? Is it not time—this is a practical proposal—to revitalise the Welsh energy project established in 1991 before the Rio summit, and update it in the light of the sustainable development agenda, which has moved ahead significantly since the project was established?
I am aware of the Aries project, which is supported by the Welsh Development Agency and the Development Board for Rural Wales and which receives European funding, on the economic development opportunities of renewable energy. The study was organised by an interesting little company in my constituency, called Dulais Engineering, which exports, among other things, photovoltaic equipment, refrigerators and medical equipment to Eritrea, and does other important work in relation to third-world economies.
I am aware of the Alt-Energy Wales project, which is funded from the European Union Altener programme. I hope that the Welsh Office will support the idea of creating an Aries Wales forum, which would provide a focus for stakeholders—there is that word again—and would provide information and assistance with preparing business plans and so on. Such a forum would help to energise the renewable energy scene in Wales.
All these matters should be considered in the context of an overall strategy covering planning issues, the encouragement of manufacturing and sourcing in Wales, training, research and development and so on. It should have targets for the contribution of renewables to total electricity supply and for reducing demand through improved efficiency. I understand that a reduction of as much as 20 per cent. is perfectly feasible.
One of the advantages of such a strategy, the drawing up of which would entail wide consultation, would be that the public at large would be able to understand the broad context in which individual developments occur. The singularly ill-informed public debate on wind energy, which is influenced more by misinformation than by enlightenment, shows that currently that is not so.
Crucially, an energy strategy should tackle offshore oil and gas resources. Currently, Welsh Office input into this enormously important and controversial policy is minimal. Perhaps the Minister will tell us what the Welsh Office is doing about it.

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Sustainable development is not just about energy, although that is perhaps the central issue. I recommend to the Minister the very useful overview on the subject provided in Plaid Cymru's consultation document, "A Sustainable Development Strategy for Wales". He already has a copy, and I have been looking forward for some time to his response.
Other areas are considered in the document, and I ask a series of questions. First, what is being done to encourage the location and growth of environmental goods and services industries in Wales? By 2000, there could be a global market of $600 billion in that sector. Does it figure in the inward investment strategy of the Welsh Development Agency or of the Development Board for Rural Wales, or in Source Wales?
Secondly, on transport, what long-term thinking is in progress in view of the Government's intention to continue to increase fuel duty, the royal commission's recommendation to accelerate that increase and the possibility of a carbon tax? What would that imply for regional economic development in Wales? How are rural areas to cope or be compensated? To what extent should electronic communications supplant physical mobility? How should that affect investment priorities? How can we develop an integrated transport policy for Wales? How will train services be protected—enhanced, even—under privatisation? How is that affected by the fact that rail is not the responsibility of the Welsh Office? Should not that be changed?
Thirdly, on farming, when will we have an integrated all-Wales agri-environmental scheme?
Fourthly, and most important, how can we create employment through sustainable development? I refer the Minister to Plaid Cymru's excellent document, "100,000 Answers", in which 30,000 of the jobs described would be created as a result of environmentally linked activity.
These issues cannot be tackled without a thoroughgoing strategic approach. Pace the right hon. Member for Wokingham (Mr. Redwood), the Tory right's so-called economic instruments on their own would be not only inadequate but socially inequitable and damaging. The 17.5 per cent. VAT on domestic fuel showed that with startling clarity. We need a range of instruments and interventions, and we need them soon, because unless we tackle the issues, Wales will lag far behind instead of being, as it could and should be in this matter, in the lead.
I have seen reference in the Welsh Office documentation to the idea of a centre for sustainability in Wales. Perhaps the Minister can tell us what is happening to that proposal, which we would strongly support. Wales should aim to become a centre for sustainability. Placing Wales at the forefront of sustainable development should be the great millennium project for Wales—that and the achievement by 2000 of real democratic self-government. The Welsh Office, even though its masters do not share our enthusiasm for the latter project, has a responsibility now to lay the foundations for the first.
What kind of body should be responsible for driving the sustainable development process in Wales? It should, of course, be a powerful Welsh Parliament, but what about the interim? Should it be the Countryside Council for Wales? Sustainable development is about much more than the countryside. It is just as much about what goes on in the factories of Glamorgan, Gwent and Deeside. The new Environment Agency has a remit for sustainable
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development. We do not have our own agency in Wales, as Scotland does, although there is a Welsh regional structure. In any case, the agency's responsibility is primarily pollution control and waste disposal, and sustainable development goes way beyond that. Sustainable development is about integrating all aspects of life in keeping with its central principles, and the organisational structure in Wales should reflect that.
The Secretary of State for Wales should now set up a powerful working group for sustainable development, comprising representatives from the Welsh Office, local government, the new Environment Agency, the WDA, the DBRW, CCW, NGOs such as Friends of the Earth, and, indeed, the Prince of Wales's environmental trust for Wales—soon to be christened "Bro"—the Confederation of British Industry and the Trades Union Congress, with higher education and research to provide the scientific and academic underpinning.
In the absence of a properly constituted democratic forum for Wales, only a powerful partnership such as that can provide the focus and resources for such a vital project. To set that process in motion would be to provide true leadership, and would mean that when a democratically elected Government or Parliament meets in Cardiff, with sustainable development as the first item on its agenda, it would already be up and running in Wales.
1.16 pm
The Parliamentary Under-Secretary of State for Wales (Mr. Gwilym Jones): I am grateful to the hon. Member for Ceredigion and Pembroke, North (Mr. Dafis) for raising the important topic of sustainable development and for the considerate and positive way in which he has approached the debate.
I am sure that we agree that this is an issue that should concern us all. Yet very often its importance can be lost through simply not understanding or realising what it means. In the words of the Brundtland definition, sustainable development is
"development which meets the needs of the present without compromising the needs of future generations to meet their own needs".
That, perhaps, still provides the most succinct definition. It challenges us to recognise the needs of economic development with those of environmental protection. Both are important and both should be in harmony. Both need to be emphasised, but not at the expense of each other.
Sustainable development is not just a matter for Government: it affects, or should affect, everyone's life style. None the less, the Government have played a significant part in taking forward the challenge of the agenda that was set at the earth summit in Rio de Janeiro.
Two years ago, the Government published their national strategy for sustainable development, which not only set out the principles of sustainable development but looked ahead 20 years to identify problems and opportunities. The underlying principles include sound science, the precautionary principle, the polluter pays principle and the need to take account of the natural environment, especially non-renewable resources.
Central and local government, business, industry, the scientific and voluntary sector and, not least, individual citizens all have a role in carrying forward the strategy. To foster that, the Government established three independent

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bodies to promote sustainable development. The Government panel on sustainable development gives authoritative and independent advice to Government on a number of broad strategic issues. The United Kingdom round table on sustainable development draws in a wide cross-section of advice from the main sectors and groups who have a role in developing and carrying forward sustainable development, and the Going for Green initiative seeks to carry the message to individuals and local communities.
I note that the hon. Gentleman expressed a preference here—and in almost every other area—for setting up a separate Welsh forum or a Welsh version of Going for Green. I remind him that there are Welsh representatives on the round table and Going for Green, and the Welsh launch of Going for Green will take place in the spring.
As the hon. Gentleman said, both the Government panel and the UK round table on sustainable development have recently issued reports. Both reports are under consideration by the Government, and responses will be issued shortly. He will appreciate that I would not wish to anticipate the detail of the responses at this stage.
One of the major developments during 1996 will be the setting up in England and Wales of the Environment Agency, which will take up its responsibilities in April. It will build on the work of its predecessor bodies, Her Majesty's inspectorate of pollution, the National Rivers Authority and local waste regulation authorities. It will seek to protect and enhance the environment in line with the Government's commitment to sustainable development.
Greater integration will mean that the agency will be better placed than its predecessor bodies to consider the environment as a whole, to ensure a consistent approach to regulation and to provide a more streamlined service to industry and to the public. The Government will issue specific guidance to the agency about the objectives, and the contribution that it should make towards achieving sustainable development. Drafts of that guidance have been issued for consultation.
The Government are anxious that their strategy for sustainable development is continually updated and developed. Annual reports are published, reviewing achievements against previous commitments, and setting quantified targets and priorities for future years. The next annual report is due in March.
The hon. Gentleman rightly concentrated on the relevance of sustainable development in Wales, and on the actions that he considers should be taken to promote that concept in the Principality. I welcome his contribution in areas such as energy, transport and agriculture. If time permits, I shall return to those issues briefly during my reply.
As I have already said, the achievement of sustainable development depends on a large number of players, of which the Government are only one. That is as true in Wales as it is elsewhere. None the less, in the Welsh Office we recognise and welcome the role that we can play in Wales. We are of course paralleling and augmenting many of the United Kingdom initiatives that I have already described.
Each year since 1991 the Welsh Office has published "Environment in Wales" reports. They provide an overview of the state of our environment, record progress
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made towards meeting previous commitments, and look forward to the likely impact of new initiatives. As the hon. Gentleman said, the Welsh Office has also hosted two seminars on sustainable development. Their purpose was to draw together key Welsh organisations, and so to encourage an exchange of ideas. I hope that a further seminar will be organised soon.
The pivotal role that local government can play in achieving sustainability was accepted at the Rio earth summit. It was agreed that every local authority should produce its own local Agenda 21 to provide a framework for sustainability in its area. Many local authorities in Wales have already made progress on that front, and we have made it clear that we hope that the new unitary authorities will give priority to completing their local Agenda 21 documents.
Raising public awareness of the relevant issues is vital if we are to achieve the goal of sustainability. I therefore very much look forward to the official launch of the Going for Green campaign in Wales.
I am confident that Wales will fully share in the benefits of the new Environment Agency. A committee will be established to advise the Secretary of State on the activities of the agency in Wales, and I am sure that its new integrated approach to the environment will enable it to become a key player in bringing about sustainable development in Wales.
Last September my right hon. Friend announced his intention of publishing a White Paper for rural Wales, and immediately set in hand a wide-ranging consultation exercise to encourage and promote debate across the whole range of the Welsh Office's policies as they affect life in rural Wales. The response to the consultation was very good, and we are grateful to all those who took the opportunity to participate, including the hon. Member for Ceredigion and Pembroke, North. The House will understand that it would, of course, be inappropriate to refer now to the probable contents of the White Paper, which we expect to be published shortly. In the meantime, the hon. Gentleman may be confident that sustainable development will be at its heart.
I shall now say a little about particular environmental issues in Wales. Our rivers and coastline are an intrinsic part of the Welsh environment, which we must protect for this generation and future generations. Recent years have brought a considerable investment in improvements to our aquatic environment, and we are now seeing the results. Last year 89 per cent. of the identified bathing waters on the Welsh coastline met European mandatory standards. That compares, for example, with a pass rate of only 48 per cent. in 1986.
The National Rivers Authority deserves much credit for the achievements that we have seen in river water quality. The authority has worked closely with the water companies and with other sectors of industry, including agriculture, to tackle the various sources of pollution. As a result of that combined effort, the most recent figures published by the NRA show that 98 per cent. of Welsh rivers are now classed as of good or fair quality, including 89 per cent. classed as of good quality. That record of achievement is set to continue. Welsh Water alone intends to invest £650 million in its environmental programme over the next five years.
Increasing pressures for housing and development require even greater care in optimising the use of scarce land resources. Within Wales the Welsh Development

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Agency's land reclamation programme is the largest landscape improvement programme in Europe. Since its formation the agency has reclaimed more than 15,000 acres, and its aim is to reclaim all significant dereliction in Wales by the end of the century.
Some of Wales' most attractive new business sites are on reclaimed land—for example, Swansea enterprise park and Delyn enterprise zone. In addition, 80 reclaimed sites have been developed for housing, such as the former national garden festival site at Ebbw Vale. In those and in other cases, land reclamation, besides being positive in itself, also avoids the need to develop green-field sites.
Mr. Elfyn Llwyd: On the provision of housing, is it not incumbent upon the Government to make it more feasible, and more commercially and financially attractive, for properties in town centres to be carefully and tastefully refurbished, so that our built heritage can be looked after in that way, rather than making it difficult, as it is now, for that to take place, which creates more pressure on green-field sites?
Mr. Gwilym Jones: I think that the hon. Gentleman and I have similar outlooks in that respect. We both want to see the best use made of existing housing. We have put in a considerable investment—about £1 billion—since 1990, and in the coming year we shall invest another £180 million in renewing Welsh housing stock, but we should make the best use of existing stock. We are very aware of the pressures on other green-field sites, as I have described in connection with business uses.
The hon. Gentleman raised other specific points, and I well appreciate his concern for Project Aries, which represents a positive initiative to produce practical solutions to assist the development of renewable energy in Wales. The Principality has a range of renewable energy sources, such as hydro, wind, landfill gas and biomass, which could be harnessed to assist the economy and the environment, through lower emissions. I welcome the project's aim of involving key organisations and individuals interested in renewables, and to identify ways of reconciling differences between them.
The project is now coming towards its conclusion, but I am pleased to see that work in that area will be taken forward in the new ALT-INVEST project, which is intended to stimulate private investment for the most promising renewable energy source schemes. I imagine that the hon. Gentleman will wish to study that.
I am sure that we are all equally concerned that road building should be part of a sustainable transport policy. Decisions to proceed with new road schemes are taken only after careful assessment of all realistic alternative solutions to the problems identified. Every effort is made to avoid areas of natural beauty or scientific interest, and if that is not possible we try to minimise the effects.
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Environmental impact assessments are undertaken for schemes costing over £1 million, and for all schemes affecting national parks, and areas such as sites of special scientific interest.
The Secretary of State's trunk road priorities and plans were published in "Roads in Wales: 1994 Review", which identifies three major strategic routes—M4, A465 and A55—on which resources will be focused. The document stresses that the A40 in Mid Wales and the A5 on the mainland are not to be developed as major routes for long-distance heavy traffic.
In the public transport sector, Wales has seen many improvements to its local rail services. South and west Wales have new links to the north-west, the midlands, the south coast and to London's Waterloo station, to connect with Eurostar services to the continent. There have also been improvements in local services in mid and north Wales. The Government's rail privatisation programme should see even more. Indeed, in being awarded the InterCity franchise into south Wales, Great Western announced its intention to provide extra services on that network.
Recently I announced the go-ahead for a range of transport measures, including new rail links to expand and improve rail services between Cardiff bay and the south Wales valleys, new bus priority schemes, and substantial cycle ways along both the north and the south Wales coasts.
All aspects of energy policy are clearly relevant to sustainable development. On the one hand, energy is an essential input to economic activity, while on the other, the production of energy can have major environmental effects through local pollution caused by emissions and through climate change caused by global warming. I have referred to actions related to carbon dioxide emissions from energy production, and we are also encouraging energy efficiency. The Government are actively promoting that policy in both the supply and demand sides of the energy industries. For example, new legislation will come into force this year requiring local authorities to identify means of improving the energy efficiency of residential accommodation.
In Wales, the NHS is working towards a 15 per cent. reduction in energy usage, and the Welsh Office has reduced its energy costs by 18 per cent since 1991. The Government are seeking to encourage new and renewable energy sources which have the prospect of being economically attractive and environmentally acceptable. Sustainable development, however, is an issue that goes wider than the environment. It is a matter of harmonising development and environmental protection. Development is needed, but it brings its pressures, and we are addressing such issues in Wales within—
Mr. Deputy Speaker: Order.

Charity Shops (Business Rate)
1.30 pm
Mr. Patrick Nicholls: I draw the attention of the House to the entry in the Register of Members' Interests which shows that I am an unpaid adviser to the British Shops and Stores Association.
I want this short debate to explore the status of charity shops, particularly as far as their business rate status is concerned. I had some difficulty in finding a title for the debate that would apply solely to one Minister, because the position of shops generally, and charity shops in particular, on business rates is part of a wider picture—the fate of town centres, and the pressure which traders feel they are under. It is not simply a matter of business rates—although, to be fair, that is regarded by most traders as the most significant matter—but also the effect on their business prospects of out-of-town shopping centres, parking restrictions and the like.
In many town centres, traditional trading communities are finding it increasingly hard to trade in a way which is traditional and conventional, while enabling them to be able to offer service to the public. There is no doubt from the representations that I have received that some traders—I would have to say, most traders—believe that the status of charity shops has a part to play as well.
Perhaps it should not be necessary—but, in this day and age, I am afraid it is—to emphasise exactly what one is not doing, as well as what one is doing. Let me make it abundantly clear, however, that I am not launching an attack on charities or charity shops. I am not saying that their role in society is anything but good. I want to emphasise that I am not attacking charities, which have a unique place in British life. There are a whole range of fiscal measures in terms of income tax, corporation tax and VAT that make it abundantly clear that charities have—and, I dare say, will always have—a unique position in our national life.
That is recognised not only by the Government, but by people up and down the land. One only has to see the amount of work that is given freely and voluntarily by members of the public to charities to know that, in a uniquely British way, charities play a part in our national life that is wholly for the good. Therefore, in no sense are my remarks to be taken, or deliberately misconstrued, as an attack on charity shops.
What concerns the traders who have made representations to me is more fundamental than that—they are concerned that measures designed specifically to help charities, particularly in relation to business rates, are being used to help organisations that are, in all but name, fellow traders.
The position in law is straightforward enough. Section 64(10) of the Local Government Finance Act 1988 requires a charity shop to fulfil two conditions to be exempt from business rates. It must be wholly or mainly used for the sale of goods donated to a charity, and the proceeds of the sale of the goods, any deduction of expenses, must be applied for the purpose of a charity.
Despite having made an immodest living interpreting the law in the past, I do not know what that means. One understands what "wholly" donated means, but what does "mainly" donated mean? Does it mean that 51 per cent. of the produce in a shop is sufficient, or 80 per cent? I suspect that that ambiguity lies at the heart of the current problems.
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If a charity—let us call it Charity Ltd.—has a number of shops in a national context, it is possible that the charity as a whole may purchase only a tiny number of goods directly for sale. But if the goods are found in one particular shop, it may well mean that the trader next door finds that he is trading in commodities against someone who is in a totally different position.
This is not an isolated problem. It has not been raised with me on only one occasion—it is a matter of great concern locally. The matter has been discussed in the past by Teignbridge district council and Newton Abbott town council, while it has been raised with me by the chambers of commerce from Teignmouth and Newton Abbott. I dare say that that can be replicated up and down the country.
If one goes to Newton Abbott, within a few minutes of walking around the town centre one sees shops representing some of the great charities in the land—the Red Cross, the National Society for the Prevention of Cruelty to Children, Rowcroft hospice, Cancer and Leukaemia in Childhood, Imperial Cancer Research, the British Heart Foundation, the Royal Society for the Prevention of Cruelty to Animals and Barnardo's.
In Teignmouth in my constituency, one sees charities such as Yugoslavian Refugees, Oxfam, the People's Dispensary for Sick Animals, Rowcroft hospice, the YMCA, the Children's Society, Holiday Services for the Disabled and the RNLI. The idea that we are talking about one or two shops is a mistake.
The difficulty is that one must rely to an extent on anecdote, and I must rely on the information that traders have given me. I am told that, if one goes into some charity shops, one does not see the traditional bric-a-brac or second-hand goods. One is looking, to all intents and purposes, at premises selling new goods. One shopfitter recently told me that the best contract he had had all year was from a charity shop. He said that he wished "other local traders", as he put it, were able to give him such good work, but they were unable to do so.
One might think that some charity shops are buying in the majority of goods to be sold on in a way that directly competes with businesses next door that simply do not have the advantage of having at least 80 per cent. relief on rates, with the potential to applying for a further 20 per cent. relief from the local authority.
What can be done? I suspect that part of the problem depends on the meaning of "wholly or mainly". In a letter in September 1994, my hon. Friend the Minister of State said:
"The meaning of 'wholly or mainly' is determined by the local authority."
That is like defining the functions of an archdeacon by saying that an archdeacon performs archdiaconal functions—it is true, but I am not sure how greatly it helps.
It would be asking too much of a local authority to carry out an audit on each and every shop that applies for an exemption from business rates. One runs into a problem right away—an authority may discover that a local shop selling a high proportion of bought-in goods is able to say that it is a part of a greater organisation, and the authority's considerations may not apply. It seems to me that it would be very difficult for a local authority to have to make such judgments.

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The effect of this ambiguity should not be underestimated. If premises are in all but name local traders, we must consider what the effect can be if they do not have to pay the uniform business rate. They will be in a position to pay higher rents, but those directly competing against them do not have the benefit of not paying UBR. Therefore, circumstances would be conceivable in which local traders were simply priced out of the market.
The question that must be considered is, in a sense, even wider than that which the Minister will answer today. We live in a time when, for reasons to which I have referred, town centres are under unique pressure. Traders in those centres are also under pressure, and society must ask itself whether its intention is that we prefer one class of trader over another by giving one unique privileges.
It must be said that there is nothing wrong with trying to earn a living by selling goods in a town centre. There is nothing wrong with being a charity, either, but if one trader-uniquely-is in a better position than another, questions must be asked.
Lest anyone imagine that I have got it wrong, and that charities never see themselves in that light, I can do no better than quote that excellent publication the Mid-Devon Advertiser, which recently carried an article about charity shops. The main point of the article is not relevant to this debate, but it contains observations that are.
It explains that a certain charity shop was not reaching its targets, and quotes a voluntary worker—understandably, the staff are not paid—as saying:
"We took £94,000 since we opened in September '94…I'm sure other shops would like to do that."
"Hear, hear", many might say. The article then quotes a man described as a chief executive of the charity's shops division as saying:
"The shop hasn't performed as well as it should have done …A target is set monthly".
The man said that the shop was
"effectively a retail business, and had to set targets to reach each week."
That says it all.
Mr. Sebastian Coe: I do not think that my hon. Friend has got it wrong. Two weekends ago, I walked the entire length of the main retail street in Redruth, in my constituency. The main issue that every retailer raised with me was having to trade shoulder to shoulder with charitable shops that had budgets that most Redruth traders could only dream of, and competing with central purchasing managers. Like my hon. Friend, I am not knocking charities.
Mr. Nicholls: My hon. Friend's intervention shows that the problem is not unique. It also reminds me to say that my hon. Friend the Member for South Hams (Mr. Steen), who wanted to attend the debate, was unable to do so because of a regional planning conference. He tells me that the position is similar in Totnes and Kingsbridge in his constituency.
What is to be done? Again, I emphasise that I am not attacking charities. It is important for me to make that point, because some people will try to misrepresent what I am saying. Nevertheless, if traders cannot compete with
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others who are traders in all but name, I feel that the Government should comment. The position is considered a local issue in at least three areas in the west country.
I should be interested to hear from my hon. Friend the Minister whether it would be possible to amend the law if such amendment proves necessary, even allowing for the constant pressure on legislative time; I should also like to know whether there is a judicial definition of "mainly" that is easy to understand. I suspect that the possibilities for litigation are legion.
It would also be useful to know more about the relationship between a local shop and the charity of which it is part, and to hear of any guidance that my hon. Friend can give. I suspect that charities themselves would welcome guidance. It must sometimes be hard for them to know precisely how the legislation applies to them. Some may be saying, "Perhaps we should take advantage of the position; other charities have. Where do we stand?"
I am not talking about traditional charities carrying on in the traditional charitable way, but I think that the current position must be addressed. If a man from Mars came here, he would see no difference between two traders, apart from the fact that one incurred expenses that were not incurred by the other.
1.44 pm
The Parliamentary Under-Secretary of State for the Environment (Sir Paul Beresford): I am always glad of the opportunity to listen to Conservative Members from the south-west, but I feel that they tend to gang up. When they have a cause, they pull together and fight for their constituents in a way that is seen in no other country. Dealing with their concerns can be a bit like facing the All Blacks.
As my hon. Friend the Member for Teignbridge (Mr. Nicholls) said, we recognise the good work done by charities, and realise that charity shops are an important source of funds for many of them. My hon. Friend, however, is worried about the possible effect on local businesses. He acknowledged the special role of charities. They are given relief from many of the taxes that commercial businesses pay, including rates, and in many cases that is right and proper; but I think it worth touching on some recent history.
Rate relief for charities predates the non-domestic rating system. Rate relief of 50 per cent. was mandatory for property wholly or mainly used for charitable purposes under the provisions of the General Rate Act 1967. Rate relief for charity shops is not a recent innovation; it has existed for some time. Specific legislation was introduced to provide rate relief for charity shops in the Rating (Charity Shops) Act 1976. Those provisions were carried through to the new system in the Local Government Finance Act 1988.
Initially, the Government proposed that the provisions from the earlier legislation be repeated in their entirety. They specified, as now, that to qualify for relief a charity shop had to be wholly or mainly used for the sale of goods donated—it is worth emphasising that—to the charity. If a shop met the criteria, 50 per cent. rate relief had to be given by local authorities: that was mandatory. The amount could be increased to as much as 100 per cent. if the authority saw fit. If it felt that the charity was particularly deserving of local support, it could top up the relief, but the extra cost would be borne by local ratepayers.

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At the time of the passage of the 1988 Act, it was feared that the new rating system might impose an unacceptably high rates burden on charity shops, and interfere with their ability to raise funds. In response to enormous pressure, the House increased the mandatory element of the relief from 50 per cent. to 80 per cent. The cost of the mandatory part is borne by the non-domestic rating pool. If a billing authority decides to give discretionary relief, it can, as under the previous legislation, top up the relief to 100 per cent., but 75 per cent. will be borne by council tax payers; the remaining 25 per cent. will be borne by the pool.
My hon. Friend is concerned about competition with local traders. He spoke of the difficulties experienced by various shops and towns, and mentioned a number of causes. Let me keep to the point, however.
To qualify for relief, charity shops must sell donated goods. That generally seems to mean old clothes, old toys and second-hand ornaments, but—anticipating the fierce case put by my hon. Friend—I decided to visit some charity shops in my area, as did some officials in the Department. They had the impression that the shops that they visited would have accepted unwanted Christmas presents: indeed, there seemed to be a fair display of those on the premises. I was reminded of a Conservative association bring-and-buy stall, and beat a hasty retreat. I saw nothing that quite fitted the pattern suggested by my hon. Friend. I suspect that, in fact, the shops I visited contained genuinely donated goods.
My hon. Friend asked how many other representations I had received. I cannot give the precise figure, but I think that the number of letters I have had must amount to about 5 per cent. of the number we receive about rates in general. Ultimately, I do not feel that my hon. Friend's concern is justified to the extent that a change in the existing law is needed. Charity shops that wholly or mainly sell goods bought from wholesalers are not entitled to relief. If the charities choose to raise revenue through such means, they too must pay rates on the shops, just like their neighbours.
I am sure that shops that sell donated goods rely on the good will and generosity of members of the public, as my hon. Friend pointed out, both in the donation of goods and as a means of donating to the charity. I am also sure that people who donate their old clothes, books and unwanted Christmas presents to a worthy cause want the money raised from the sale to go to those causes.
As I think my hon. Friend will accept, the issue pivots on the action of the local authority, not on a blunderbuss, across-the-board treatment by central Government through legislation or direction. There is a
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horses-for-courses arrangement, in which the local authority has the ability and the expertise, and can visit each premises and judge for itself.
The phrase is not simply "mainly", but "wholly or mainly". References to premises used "wholly or mainly" for certain purposes are found throughout rating law, and the definition of "wholly or mainly" will depend largely on the circumstances of the case involved. There is a body of case law on the meaning of
"wholly or mainly for charitable purposes",
which may shed light on the issue. If my hon. Friend wishes, I will write to him with some examples.
Mr. Nicholls indicated assent.
Sir Paul Beresford: I see that he would be interested.
In the case of charity shops, in the first instance it is for each local authority to decide whether a shop meets the legal requirements to qualify for relief. The authority might want to consider a wide range of factors when deciding whether a charity shop is wholly or mainly selling donated goods. Local authorities are in the best position to see the local situation and to judge it. Indeed, most local authorities have been exercising judgment on charity shops sensibly for at least two decades.
There is a discretionary element, and again, it is right and proper that local authorities should use that when deciding which charities are deserving of local support. I understand that Teignbridge district council has decided that a blanket policy is to be avoided, which is right. It is approaching the element of local discretion in entirely the right way. Each case should be decided on its merits and on local circumstances, and each billing authority should decide whether the charity is worthy of additional relief. The authorities have a financial incentive to choose wisely. After all, they have to pick up three quarters of that extra funding if they decide to give the relief.
Proper consideration and implementation of the legislation, as it stands, and leaving the matter in the hands of the local authorities are the right way to proceed, but I will write to my hon. Friend with some additional bits and pieces to explain cases that we considered. I hope that, in areas of concern, he will apply pressure to the local authority to do what it is there to do.
It being eight minutes to Two o'clock, the Motion for the Adjournment of the House lapsed.
Sitting suspended, pursuant to Standing Order No. 10 (Wednesday sittings), till half-past Two o'clock.

PRIVATE BUSINESS
  EDINBURGH ASSAY OFFICE BILL
  Read the Third time, and passed.
Oral Answers to Questions
  SCOTLAND

    Income Tax
    Mr. Jacques Arnold: To ask the Secretary of State for Scotland what discussions he has had with the Treasury concerning the practicalities of a different rate of income tax for Scotland. [10785]
    The Secretary of State for Scotland (Mr. Michael Forsyth): Labour, Liberal and Scottish National party support for a tartan tax will be immensely damaging to Scotland and create huge problems for employers on both sides of the border.
    Mr. Arnold: Bearing in mind the huge costs and problems for employers in Scotland, and although I, as an English Member, would welcome the transfer of jobs from Grangemouth to Gravesham, how on earth does my right hon. Friend think that Labour and the other parties can justify to the Scottish people that impact on jobs in Scotland?
    Mr. Forsyth: My hon. Friend is absolutely right. The tartan tax will be a tax on Scotland's jobs and would certainly disadvantage Grangemouth. He also has considerable cause for worry about his constituents in Gravesham, because Labour is proposing a tax on jobs—the social chapter—that would apply to the whole of the United Kingdom.
    Mr. Canavan: Can. the Secretary of State name any Parliament in the world that does not have revenue-raising powers or any country in the world, apart from Scotland, that has its own laws and legal system but no Parliament of its own to pass those laws?
    Mr. Forsyth: The hon. Gentleman should move back two Benches and join the Scottish Nationalists if he wants to ask questions like that. In case he has not noticed, the United Kingdom is the greatest country in the world, with the greatest history. All parts of the United Kingdom have benefited from that.
    Sir Hector Monro: Is my right hon. Friend aware that, during the passage of the Scotland Bill in the 1970s under a Labour Government, it was generally accepted that the advice from Treasury Ministers to the Government was that it was impossible to introduce a differential income tax in the United Kingdom? What is the view of the Treasury Ministers in our Government?
    Mr. Forsyth: I have to agree with my right hon. Friend. He is right. It was considered impractical for the same reasons as Labour Members have opposed a local income tax. They argued that a local income tax would be difficult to collect because of great administrative problems. People are taxed not according to where they live but according to where their employer is. There is no doubt that a tartan tax would create enormous problems and anomalies. For example, Scottish Labour Members would not pay the tartan tax even
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    though they were Scottish Members because they are paid in Westminster in England and would therefore be exempt from it.
    Mr. Menzies Campbell: The Secretary of State has obviously taken a careful interest in the effect of taxation on employment. Would he be kind enough to tell us his assessment of the consequences for employment in Scotland of the tax increase—which is now equivalent to a net 6p in the pound—that his Government have imposed since 1992?
    Mr. Forsyth: The hon. and learned Gentleman has a real cheek. To be fair to his party, it is at least honest—unlike some Opposition Members who vote for our tax reductions and then complain about the public expenditure consequences. The hon. and learned Gentleman and his party want income tax to go up. Although their partners in the Scottish Constitutional Convention say that there is no tartan tax, he and his hon. Friends are going around promising to spend it even before it has been brought into being.
    Mr. Peter Atkinson: Will my right hon. Friend speculate on the tartan tax's impact on businesses on either side of the border? Would it encourage more of my constituents in Northumberland to shop in Scotland, or even more Scots to travel from the border regions to Newcastle shopping centres?
    Mr. Forsyth: Far be it from me to give any credibility to the idea of people not shopping in Scotland, but my hon. Friend is right. The tartan tax would add to the costs of employment and of businesses. It would put prices up in shops in Scotland. As my hon. Friend points out, his constituents would benefit from that. Even more seriously, together with the crackpot policies for a Parliament whose funding would still be determined here, it would lead eventually to the fragmentation and break-up of the United Kingdom, which would mean huge price increases in Scotland, high inflation levels and spiralling unemployment.
    Mr. George Robertson rose—
    Mr. Jenkin: Cluck, cluck.
    Mr. Robertson: Dear, oh dear. That comment, Madam Speaker, was from the parliamentary private secretary to the Secretary of State.
    Now that the Secretary of State has had his wrists slapped for breaking the guidelines, will he apologise to the Scottish Office information directorate for using it as a scapegoat for putting party propaganda in press releases, and to the Scottish taxpayer for peddling propaganda at their expense? When will he realise that the truth about the popularity of our plans for a Scottish Parliament will always beat the lies about non-existent taxes?
    Mr. Forsyth: When will the hon. Gentleman rise to the occasion that being shadow Secretary of State for Scotland requires? On the use of the phrase "tartan tax", before I used it—and I did so in the first press release that I issued from the Scottish Office—I asked for advice from the permanent secretary and I was assured that it would be in order. The permanent secretary's advice changed

    983
    after the hon. Gentleman complained that the phrase was in widespread use and now a matter of political controversy. I have always accepted that advice. Why is the hon. Gentleman so afraid of the tartan tax? Is it because he knows that the people of Scotland do not want to pay it? If it is non-existent, let him rise in the House and tell the people of Scotland that he will drop his crackpot proposals to have a tax-raising power for his Scottish Parliament, which would impose that tax on the working people of Scotland.

    Scottish Government
    Mr. Duncan: To ask the Secretary of State for Scotland if he will make a statement on the future relationship of the Government of the United Kingdom with the Scottish people. [10786]
    Mr. Michael Forsyth: We are Unionists and stand four square behind the Union, which has benefited Scotland, England, Northern Ireland and Wales.
    Mr. Duncan: Does my right hon. Friend accept that those of us from England who express an interest in Scotland do so not to pursue narrow party advantage, as the Labour party does, but out of concern for the United Kingdom as a whole? Will he reaffirm that devolution would be a profound act of unsettlement? Would it not throw into turmoil the number of Westminster Members of Parliament that there should be from Scotland, the way in which Scotland is taxed and funded, and the election system itself? In seeking any cross-party understanding on this matter, has my right hon. Friend had any confirmation from the hon. Member for Hamilton (Mr. Robertson) that he is prepared to deal with the anomalies to which he has admitted, and with his differences with the Liberal Democrats?
    Mr. Forsyth: I do not like the word "anomaly", which is how the hon. Member for Hamilton has described the vital issue of how many Members of Parliament represent Scotland in the House. Nor do I agree with the Leader of the Opposition, who described the funding of the Scottish Parliament as an accountancy detail. On those matters rests Scotland's prosperity, the quality of public services and our ability to have an effective voice for Scotland here at Westminster, where, even under the Scottish Constitutional Convention's proposals, the big decision—on Scotland's budget—would be taken. Liberal Democrat Members are at least honest enough to admit that there would have to be a reduction in the number of Members of Parliament, and the loss of the office of Secretary of State for Scotland. That is too high a price to pay on top of the Labour party's tartan tax.
    Dr. Reid: One of the primary mechanisms by which the people of Scotland convey their representations to the United Kingdom Government is local government. I understand that, within an hour, there will be a report of the inquiry into local government in North Lanarkshire council. Why was that not available before Question Time today? Is it because it exonerates councillors in North Lanarkshire and, if so, will the Secretary of State tell us how much the inquiry cost and who will pay, and guarantee that in future such inquiries will not be used as a party political weapon by one party against another?
    Mr. Forsyth: A written question has been tabled and the report will be published. No doubt the hon. Gentleman
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    will be able to study it, together with the report that has been published by his own party. The inquiry was established after we received representations from those with responsibility for ensuring fair play in local government, and it is pretty disgraceful of the hon. Gentleman to ask a question in those terms.
    Mr. Marlow: How would my right hon. Friend describe a proposal that would allow Scottish Members of Parliament to vote, for example, on whether there should be selection in our schools in England, but would not allow English Members of Parliament to vote on education policy in Scotland? Would that not be hypocritical perhaps?
    Mr. Forsyth: I am a Unionist. I believe in this Parliament and I believe in everyone's right to vote on matters that concern the United Kingdom. Opposition Members have argued that English Members should not vote on issues affecting Scotland. It is interesting to note that tonight, when we celebrate the bicentenary of the birth of Robert Burns—
    Mr. Foulkes: The death.
    Mr. Forsyth: All right, it is the bicentenary of his death. The hon. Gentleman may be celebrating his death, but let us compromise on death and birth so that we have his life's work.
    It is significant that tonight, as we have a big function in Whitehall to celebrate the life and works of Robert Burns, Scottish Opposition Members will insist on no pairing arrangements applying to voting on, of all things, the English rate support grant.
    Mr. George Robertson: The relationship between the Government and the Scottish people will be immeasurably soured by the spending restrictions that the Secretary of State is imposing on Scottish local councils. Has he read The Scotsman today, in which the Tory leader of the new Borders council has expressed his disgust at the spending restrictions that are being imposed on that council, necessitating cuts in the education budget?
    When the Secretary of State sounds off about law and order in Scotland, which is an important issue in the relationship between Government and the people, will he explain why the expenditure of Strathclyde police joint board is £304 million yet the Government will give it only £302.5 million? With that spending gap, how will the police be able to tackle the problems of law and order in that part of Scotland?
    Mr. Forsyth: I have given substantial increased provision for the police. The hon. Gentleman's position would be slightly more credible if he and members of his party were not travelling around Scotland saying that expenditure was not enough without saying how much extra they would spend.
    Instead of speaking about cuts, perhaps the hon. Gentleman would acknowledge that there is an increase in local government expenditure in Scotland over and above the amount that we get under the Barnet formula consequences of more than £25 million. Instead of telling fibs about the Government and what the Government have done, members of the Labour party would do better to draw

    985
    attention to the increase that has been made. If the hon. Gentleman feels that the expenditure is not enough, he should say how much more a Labour Government would provide. If he is not able to do so, he should stay quiet.

    Unemployment
    Mr. John Marshall: To ask the Secretary of State for Scotland what is the latest unemployment figure; and what the equivalent figure was in December 1992.[10787]
    The Parliamentary Under-Secretary of State for Scotland (Mr. Raymond S. Robertson): Unemployment in Scotland has fallen by 55,000 since December 1992, to 195,900 in December 1995.
    Mr. Marshall: Will my hon. Friend confirm that unemployment in Scotland, at 7.9 per cent., is much lower than in France, Germany, Italy and Spain, all of which follow the economic policies recommended by the Labour party? Does he agree that the only threat to a continued reduction in unemployment in Scotland comes from the proposals for a national minimum wage, the adoption of the social chapter, and from that confounded tartan tax?
    Mr. Robertson: My hon. Friend is absolutely right. I am sure that he will understand me when I say that it is with real regret that while he, as a Scot in exile, can take great pride in all of Scotland's achievements and its advances, the Opposition Members who have the privilege to represent Scottish constituencies use every opportunity to run down Scotland, as the next few minutes will no doubt prove.
    Mr. Michael J. Martin: What steps is the Minister taking to bring more employment to the districts of Possilpark, Springburn and Dennistoun?
    Mr. Robertson: I am sure that the hon. Gentleman realises that unemployment has decreased by 6 per cent. in the past year in the areas that he has mentioned in his constituency. Obviously, we will continue the policies that he knows are working.
    Mr. Ian Bruce: How much would a separate Parliament in Scotland have to levy on employees in income tax if it were to make up the £3.1 billion extra that the Government spend in Scotland over and above what they spend in England per head of the population? If that levy were imposed, how would it relate to those employees' income tax and to the unemployment rate in Scotland?
    Mr. Robertson: As my hon. Friend knows, the proposed tartan tax of 3p, in the pound would raise £450 million. I leave it to my hon. Friend and to Opposition Members to work out exactly what the shortfall would be. I hope that they will put that in each and every one of their election addresses at the next general election.
    Mr. Malcolm Bruce: The Under-Secretary of State will be aware of the announcement this week of the closure of Buchan Meat, which is in the constituency of the hon. Member for Banff and Buchan (Mr. Salmond). It is a very important plant for meat producers in the
    986
    north-east of Scotland, employing almost 300 people. Can he explain what his Department is doing to make contact with Grampian Enterprise to ensure that we save those jobs and maintain the added value that that high-quality meat facility provides in the north-east of Scotland?
    Mr. Robertson: The hon. Member for Banff and Buchan and people at the factory have been in touch with my right hon. Friend the Secretary of State today and yesterday. Of course I agree with the hon. Member for Gordon (Mr. Bruce) that the loss of jobs is always a matter for regret, particularly when it is such a large number in a relatively small community. My right hon. Friend the Secretary of State and the Under-Secretary of State for Scotland, my hon. Friend the Member for Kincardine and Deeside (Mr. Kynoch), are keeping in close touch with Scottish Enterprise and Grampian Enterprise to see what can be done.

    Exports
    Mr. Simon Coombs: To ask the Secretary of State for Scotland if he will make a statement on the current level of Scottish exports. [10788]
    The Parliamentary Under-Secretary of State for Scotland (Mr. George Kynoch): Scotland's manufactured exports have reached an all-time record of £14.3 billion.
    Mr. Coombs: Can my hon. Friend confirm that, besides whisky and computers, almost all sectors of Scottish industry showed export growth in 1994 and that, in particular, the motor car and spare parts industries showed an increase of almost 60 per cent. on the rate in the previous year? What would be the effect of a tartan tax on that excellent growth record?
    Mr. Kynoch: My hon. Friend is absolutely right to highlight the exporting successes during the past year. In fact, exports in the food and drink industries, excluding whisky, increased by more than 11 per cent.; paper and printing exports increased by 23.7 per cent.; and chemicals exports increased by 14 per cent. Growth has been right across the board.
    My hon. Friend is absolutely right to refer to a tartan tax because export success depends on the competitiveness of the Scottish industrial base. Not only would a tartan tax hit exports, but I read in the press this morning that the deputy general secretary of the Scottish Trades Union Council proposes that we now go for a four-day week, but maintain wage rates. That would result in a 25 per cent. increase in costs and a dramatic reduction in competitiveness, which would be disastrous for exports and disastrous for business.
    Mr. David Marshall: What information can the Minister provide to the House on the progress of negotiations with Japan about the vexed question of taxation and Scotch whisky exports?
    Mr. Kynoch: I think that the hon. Gentleman will be aware that that subject is examined constantly. The World Trade Organisation is considering the matter at present,

    987
    and both Scottish Office and other Ministers raise the issue with the Japanese Government whenever they visit Japan.
    Mr. Gallie: Is my hon. Friend aware that the rise in Scottish exports has played a major part in reducing unemployment in my constituency by 24 per cent. in the past three years? What assurances can he give me that that welcome progress will continue?
    Mr. Kynoch: My hon. Friend's local enterprise company makes a sterling effort in that regard. That fact was repeated to me this morning when I attended the celebrations for the bicentenary of Robert Burns's death. [Interruption.] That shows that I learn quickly. Scottish Enterprise, together with the local enterprise companies, is participating in the new export strategy, the international challenge, which I launched in September. We are making a great effort to ensure that small and medium-sized companies receive the best possible exporting assistance. That will ensure continuing success and continuing record exports from Scotland.
    Mr. Beggs: Does the Minister agree that exporters in the west of Scotland, the highlands and islands, Northern Ireland and the Irish Republic would benefit from increased funding and further expenditure on the A75 and the west coast main line? Will the Scottish Office endeavour to ensure that such upgrading continues?
    Mr. Kynoch: I am delighted to see the hon. Gentleman for the second time today—he was present this morning at the ceremony at the statue of Robert Burns on the embankment. I hear what the hon. Gentleman says, and I shall ensure that my hon. Friend the Minister responsible for transport issues in the Scottish Office hears the same thing.

    Film Industry
    Ms Roseanna Cunningham: To ask the Secretary of State for Scotland when he last met representatives of the Scottish film industry to discuss the industry's future prospects. [10789]
    The Minister of State, Scottish Office (Lord James Douglas-Hamilton): My noble Friend the Under-Secretary of State, the Minister with responsibility for the arts in Scotland, met leading figures in the film industry from overseas, the United Kingdom and Scotland on 10 January.
    Ms Cunningham: As part of his continuing film initiative, will the Minister institute discussions within his Department and with other interested parties about establishing a Scottish film school, which would do a great deal to nurture and develop talent in Scotland? If he agrees to do that, will he take into consideration other international models, such as the Danish film school—which, in its 20 years' existence, has made an enormous contribution to the film industry in that country?
    Lord James Douglas-Hamilton: We are now looking at all the options for which the Secretary of State has asked and which Scottish Enterprise is undertaking. The hon. Lady will also be aware that a number of studies are
    988
    taking place, and we hope to be in a position to make a comprehensive statement in the early spring. The hon. Lady will appreciate that tourism figures have soared in Scotland as a result of the enormously successful films set in Scotland: "Braveheart", "Rob Roy" and "Shallow Grave".
    Mr. Jessel: In view of the fact that the Scottish film industry is becoming more and more successful, does my hon. Friend believe that increasing tourism in Scotland could be damaged by the tartan tax? Will he also confirm that the new film "Loch Ness" is to be premiered shortly in Inverness?
    Lord James Douglas-Hamilton: Yes, that film will be premiered in Inverness shortly and I believe that it will be extremely successful.
    As to the first part of my hon. Friend's question on the tartan tax, he is absolutely correct to suggest that those who provide facilities for overseas tourists would have the greatest reservations about the tartan tax if they had to pay far more than tourist operators and tourist service providers elsewhere in Britain.
    Mrs. Liddell: If the Government are so anxious to do something about the Scottish film industry, why have they failed to convince the Chancellor to amend the Capital Allowances Act 1990 to encourage private investment in the film industry by redefining expenditure on film as revenue expenditure? If the Government simply duck issues such as that, it will become patently obvious that their interest in the film industry is yet another propaganda exercise and another opportunity for the Secretary of State to pose for nice photographs with Mel Gibson to use in the right hon. Gentleman's election address.
    Lord James Douglas-Hamilton: We are looking at all the options, including the position on tax. As I stated last night, the Government will consider whether there are any lessons to be learnt from the Irish experience which can be applied to the Scottish situation in the light of the consultants' report. The hon. Lady will be pleased that the production of a CD-ROM, about Scotland as a screen location, has been funded by the Scottish Office, and many hundreds of thousands of pounds are being provided by the Scottish Office for films in Scotland.

    Forestry Policy
    Sir Thomas Arnold: To ask the Secretary of State for Scotland if he will make a statement about forestry policy. [10790]
    Mr. Raymond S. Robertson: The main aims of our forestry policy are the sustainable management of our existing woods and forests and the steady expansion of tree cover to increase the many, diverse benefits that forests provide.
    Sir Thomas Arnold: Has the framework document for the new forest enterprise agency been agreed, and is there a problem with defining the specific rate of return that the agency will be expected to achieve?
    Mr. Robertson: The framework document is actively under consideration by Ministers at the moment, and my

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    noble Friend the Minister with responsibility for agriculture, forestry and the environment, who is responsible for that matter, will bring forward a statement in the near future.
    Mr. Foulkes: Is the Minister aware that vast areas of forest in my constituency in south Ayrshire would have to be destroyed if the electricity interconnector with Northern Ireland went ahead? In view of the alarm caused by the laying of the gas pipeline and the threat to the forest, as well as to the people on the south-west coast from the explosives in Beaufort's dyke, does he agree that there should be a third public inquiry into the undersea section of that interconnector before it is allowed to go ahead?
    Mr. Robertson: I commend the hon. Gentleman for getting a question about Beaufort's dyke into a question about forestry. The hon. Member for Glasgow, Cathcart (Mr. Maxton) was shaking his head in complete disbelief and I think that he summed up the feeling of the House.
    Mr. William Ross: Leaving aside for a moment the fact that electricity lines need poles, can the Minister give the House any indication of what tonnages of softwood the Government would like to see produced in this country in 35 years hence, which is the length of time it takes a Sitka spruce tree to grow to available size? What quantities and tonnages of hardwoods will we need 100 years hence?
    Mr. Robertson: Softwood is a particular concern of my noble Friend the Minister with responsibility for forestry, and I will ensure that the hon. Gentleman receives a full reply from him as soon as possible.

    Highlands and Islands
    Mr. Macdonald: To ask the Secretary of State for Scotland if he will make a statement on the economic prospects for the highlands and islands in 1996–97. [10793]
    Mr. Kynoch: They remain excellent.
    Mr. Macdonald: Will the Minister confirm that funding for Highlands and Islands Enterprise will be cut by £3 million in the next financial year; that funding for the three main further education colleges will be cut by £500,00 next year; that funding on housing in the highlands will be slashed next year; and, of course, that funding for local authorities has also been reduced, by some £2 million in the case of the Western Isles? When the Minister comes to Inverness next Monday, will he take the opportunity to explain to the people of the highlands and islands that all those cuts into the economic muscle of the highlands are necessary to finance pre-election tax cuts?
    Mr. Kynoch: The hon. Gentleman refers to Highlands and Islands Enterprise. That organisation has a budget for 1996–97 of some £75 million. In the round of public expenditure settlement that we have had, that is a very fair settlement. Clearly, Highlands and Islands Enterprise has the opportunity to lever in private sector funds from industry, which it now does. It is more than capable of maintaining levels of output and improving on them.
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    The hon. Gentleman is perhaps unaware that we have increased funding to local government throughout Scotland by some 2.9 per cent. this year. With the reorganisation of local government, local authorities have a significant opportunity to deliver more cost-effective services. However, the hon. Gentleman and the Labour party seem intent on giving more money to local government. The hon. Member for Dundee, East (Mr. McAllion) was on BBC Television's "Scottish Lobby" with me at the weekend and he said that, if the Labour party had been in office this year, it would have given an extra £200 million to local government in Scotland. Would he take that money from the health budget, the education budget or another budget?
    Mr. Matthew Banks: Will my hon. Friend confirm that, in the current financial year, some 3,200 jobs will be created in the highlands and islands, very much along the lines of previous years? Is not it about time that we talked up the economic prospects of the highlands and islands rather than denigrated them as the Labour party does?
    Mr. Kynoch: My hon. Friend is right. I know that he is a regular visitor to the highlands as a tourist. Tourism accounts for 20 per cent. of employment in the highlands and islands and is a significant contributor to the economy. I believe that there are remarkable success stories to tell in that area. For example, Selfcare in Inverness represents a major inward investment in the area and should be welcomed. We rarely hear good news from the Labour party.
    Mrs. Ray Michie: The Minister will be aware that the economic prospects for Campbeltown and Kintyre in my constituency will be greatly enhanced once there is a ferry link between Campbeltown and Ballycastle. He will be aware that the Secretary of State has taken a particular interest in the matter. Is he able to give any indication about when a ferry operator will be chosen? I am sure that he agrees that it will be a marvellous thing for the entire area—Kintyre and Northern Ireland—and that it would be a nice thing to happen in the new peace climate.
    Mr. Kynoch: My right hon. Friend the Secretary of State and I have great sympathy for the hon. Lady's case. My right hon. Friend must take proper advice before reaching a conclusion. At this stage, no proposals have been put to Ministers, but we will bear the hon. Lady's comments in mind when we consider them.

    Campbell's Soups
    Mr. Campbell-Savours: To ask the Secretary of State for Scotland what representations he has received about the boycott of Campbell's tinned soups in Scotland. [10794]
    Mr. Kynoch: None.
    Mr. Campbell-Savours: The Minister will know that the campaign to boycott Campbell's soups and Fray Bentos products in Scotland has been extremely successful. He will also know of the appalling action taken by Campbell Soups to close down the extremely profitable Homepride factory in my constituency. Will he join me in asking those who are boycotting Campbell's soups in Scotland to buy Baxter's soups instead, which

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    are made in the constituency of the hon. Member for Moray (Mrs. Ewing)? Should not the slogan in Scotland be, "Boycott Campbell's and buy Baxter's"?
    Mr. Kynoch: I know that the hon. Gentleman is waging a significant campaign on this issue and I read with great interest the remarks he made in the Adjournment debate on 6 November. I have a great deal of sympathy with much of what he said, but there is little that I can add to what my hon. Friend the then Minister for Competition and Consumer Affairs, the hon. Member for Brecon and Radnor (Mr. Evans), said at that time.
    Mrs. Ewing: Madam Speaker, you will recognise the importance attached to all our fish and food processing organisations in the north-east of Scotland and their significance to the local economy. Given that, and the remarks made by the hon. Member for Workington (Mr. Campbell-Savours), will the Minister explain what aspect of the Scottish Office budget will be allocated to promoting those high-quality goods, especially as they employ many people who give of their best to ensure high standards so that Scotland's name is recognised in the international community?
    Mr. Kynoch: The hon. Lady is right about the importance of the food industry to Scotland. If she looks at what we are doing with Scottish Enterprise and Scottish Trade International, she will realise that significant efforts are put in to export assistance for the food industry. My right hon. Friend the Secretary of State launched a cookery promotion at the boat show in London recently—I was not aware that he was an expert.
    We take every opportunity to promote Scottish products. We also have Scotland The Brand and I know that companies in the. hon. Lady's constituency—they have already been mentioned—have been involved. I believe that the local enterprise company in her constituency, Moray Badenoch and Strathspey Enterprise, is also involved. I participated in a promotion in Regent street just before Christmas. I believe that the Scottish Office is making every effort to ensure that the best of Scotland is promoted and exported in the interests of everyone.

    Scottish Council (Development and Industry)
    Mr. Salmond: To ask the Secretary of State for Scotland when he next intends to meet representatives of the Scottish Council (Development and Industry) to discuss the trends in the Scottish economy; and if he will make a statement. [10795]
    Mr. Michael Forsyth: I met representatives from the Scottish Council (Development and Industry) shortly after I was appointed and following my invitation to organisations throughout Scotland to meet me to discuss their concerns.
    Mr. Salmond: Is the right hon. Gentleman aware that the 250 job losses at Buchan Meat in Turriff doubled local unemployment at a stroke? In a community the size of Turriff, it is the equivalent of thousands of job losses in an urban conurbation. Does he recognise that he should respond to that problem as a matter of national priority and not simply leave it to local agencies? Is he aware that
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    the workers action committee in Buchan Meat is keen to advertise the fact that there are many excellent, expanding and profitable product lines in the factory, not least Boeuf D'Ecosse, a new packaged product that was to be trial launched on the French market in a £1 million venture this week? There are many products in that factory which would prove extremely attractive to alternative investment.
    Does the right hon. Gentleman agree that the message is that alternative investment in the people and products of the area will be warmly welcomed, but that those interested only in asset-stripping—removing machinery, products or jobs from the factory—will be as fiercely resisted in Turriff as they are in Workington?
    Mr. Forsyth: I am sure that all hon. Members are well aware of the difficulties created in Turriff by the liquidation of Buchan Meat. I am happy to give the hon. Gentleman an assurance that Scottish Enterprise will be involved. Indeed, it and the local enterprise company tried to prevent the liquidation, albeit—unfortunately—unsuccessfully. I understand the hon. Gentleman's concern about the impact the loss of jobs could have on Turriff and the surrounding areas—not least the farmers and others who are shareholders in the company.
    I shall be happy to meet the hon. Gentleman to discuss what can be done. I shall ask Scottish Enterprise to pull out every stop—I know that it will—to try to ensure the continuation of local employment. The hon. Gentleman will be aware that there are great difficulties, but I am sure that, on this matter, we can be of one mind and share a single-minded determination to do what we can to prevent further job losses in his constituency.
    Mr. Stewart: When my right hon. Friend next meets the Scottish Council (Development and Industry), will he ask it to carry out a full and objective economic analysis of the effect of a tartan tax on the Scottish economy? In particular, will he point out that the reason why Scottish Labour Members are so fanatical about a tartan tax is that they would not have to pay it? They would be at Westminster, on full pay, with nothing to do except speak on English matters—with no liability to pay the tartan tax.
    Mr. Forsyth: I do not know whether this is correct, but I am told that even the people who work in Labour's research department in Scotland would not have to pay the tartan tax because they are paid from Walworth road. My hon. Friend has pointed out an anomaly—[Interruption.] I say to Labour Members who laugh and jeer about the tartan tax that it is not a joke. In the unlikely event of Labour ever getting into power to set up its tax-raising Scottish Parliament and introducing the tartan tax, the result would be £6 a week extra in tax for the average family. It would mean losing the family holiday and I do not think that most people in Scotland are prepared to give up their holidays to give politicians an opportunity to be put out to grass in Edinburgh.
    Mr. Home Robertson: Is the right hon. Gentleman aware that IBM is transferring the manufacture of its computer keyboards from LEMAC in Haddington to the far east, thereby destroying the jobs of 252 of my constituents? Why are the Government allowing that multinational giant to have free access to the European market without accepting responsibility for the low-paid

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    employees of its contractors in Scotland? When the right hon. Gentleman next meets the council, will he discuss what the Government intend to do to create more jobs for my constituents in east Lothian?
    Mr. Forsyth: The first thing that we are doing is resisting idiotic proposals such as a tartan tax, the social chapter or a minimum wage—all of which would add to employment costs. If the hon. Gentleman has begun to realise that jobs are mobile and that we must fight like tigers to get them, we may be making some progress with the unfortunate circumstances that exist in his constituency. When I met IBM recently to discuss inward investment, it became clear to me that we are in a fiercely competitive market and that we need a low tax, low regulation economy. The hon. Gentleman, with his support for a tax-raising Parliament, is the enemy of jobs in Scotland.

    Violent Crimes
    Mr. Gallie: To ask the Secretary of State for Scotland what proportion of reported crimes of violence have been committed by re-offenders in the last 12 months; and if he will make a statement. [10796]
    Lord James Douglas-Hamilton: Information is not available in the form requested, as not all reported crimes of violence result in a conviction. In 1994, 17 per cent. of persons convicted of a crime of violence—which category includes serious assault, sexual assault, robbery and possession of offensive weapons—had been convicted of a similar offence in the previous five years.
    Mr. Gallie: What steps will my hon. Friend take in respect of crimes of violence committed by youngsters? There still seems to be a problem with the carrying of knives. Will my hon. Friend consider introducing legislation to prevent the sale of knives to young persons under the age of 18? Will he also consider introducing legislation to prevent the consumption of alcohol in public places by youngsters under 18?
    Lord James Douglas-Hamilton: It is illegal to sell alcohol to under-18s, and a large number of councils have adopted byelaws approved by the Secretary of State to prevent the consumption of alcohol in public places. We will consider, in co-operation with the Home Office, any proposals that my hon. Friend has—but we must be certain that proposals are enforceable by the police. We believe that the Health Education Board for Scotland should spearhead health enhancement among the young.
    As to the carrying of knives, there have been a number of successful campaigns, such as Operation Combat. The number of attempted murders involving the use of knives fell by half as a result, which every police force should bear in mind.
    Mr. McFall: Does not the Minister's answer reveal the total failure of the Government's criminal justice policies? With friends such as the hon. Member for Ayr (Mr. Gallie), who needs enemies? The present policy clearly does not work. At Glasgow district court a few months ago, 7,000 criminal cases were dropped because of lack of resources. Apart from that being a kick in the
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    teeth for the victims of crime, is not it the case that the several thousand villains who are out and about in Scotland regard the Government as their friends?
    Lord James Douglas-Hamilton: The dropping of that large number of cases was the responsibility of Glasgow district council, which refused to make available the necessary facilities. The hon. Gentleman should direct the strength of his criticism to that council. I am proud to be associated with my hon. Friend the Member for Ayr (Mr. Gallie), who introduced a necessary provision to allow prosecutors a right of appeal against sentences that are too lenient. That right has been used successfully, and such offenders have been subjected to heavier sentences as a result of the measure for which my hon. Friend fought. He was right to fight for it, and that measure is greatly to his credit.
    Mr. Bill Walker: Does my hon. Friend recall previous law and order Bills and the Opposition opposing measures that the Government wanted to introduce? Does my hon. Friend remember the speeches made about stop and search, which has produced remarkable results? Does not that measure show that Conservatives are tough on crime, whereas Labour supports not the victims of crime but the persons who practise it?
    Lord James Douglas-Hamilton: My hon. Friend is right to remind the House that, originally, Labour Members opposed the right of police officers to search persons whom they suspected of carrying weapons. Despite that opposition, the law was changed. As a result, the number of persons who commit crimes involving knives is considerably lower than it would have been.

    New Towns
    Mr. Norman Hogg: To ask the Secretary of State for Scotland what plans he has to encourage employment opportunities in Scotland's new towns; and if he will make a statement. [10797]
    Mr. Kynoch: Scottish Enterprise and the local enterprise companies recognise their responsibility to maintain economic development in new towns.
    Mr. Hogg: Would I be absolutely right to say that new towns and their staff had an excellent track record of creating jobs and attracting inward investment to Scotland's new towns and that the new towns have led inward investment in Scotland since the second world war? That being the case, would it not be appropriate for the Minister to ensure that the employment of those staff is cared for in the transition from the development corporations to the new unitary authorities? Will he ensure that everything possible is done to guarantee their future employment?
    Mr. Kynoch: There seems to be a game of trying to get us to say, "You are absolutely right." I am interested to hear the hon. Gentleman's comments. He raises some valid points. Over the past five years, in Cumbernauld, for example, which is obviously of great interest to him, Locate in Scotland has recorded 36 planned inward investment projects, involving planned investment of more than £87 million associated with the expected

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    creation or safeguarding of more than 2,000 jobs. I am anxious to ensure that we continue the process of inward investment into the new towns. They are of course no longer new towns, which is why the new town development corporations are being wound up. Locate in Scotland has been in regular contact with the new town development corporations and I am very confident that the positive efforts that have been brought about remarkably successfully by many people through partnership will continue in future.
    Mr. Neil Hamilton: Does my hon. Friend agree that Scotland's recent record on job creation, compared with that of other parts of the United Kingdom, has been excellent, but that all those encouraging gains would be set at nought if we had a tartan tax, the extra imposts on employers that the social chapter would bring, and a minimum wage? Is he aware of the budget announced yesterday in Germany? The German Government are now well aware of the job-destroying consequences of all their foolish decisions over the years, which have loaded employers with huge costs and will only reduce the wealth-creating potential of the country.
    Mr. Kynoch: My hon. Friend draws attention to Germany, where unemployment is rising, whereas it is falling consistently in this country. Not only are the taxes to which my hon. Friend has referred important to the future competitiveness of Scottish industry in particular; the costs of labour in Scotland are important too.
    If new Labour is all about trying to go forward, having stakeholding and involving the unions more closely on factory premises, I should like to know whether it disassociates itself from what Mr. Bill Speirs, the deputy general secretary of the Scottish Trades Union Congress, said yesterday. He demanded that the working week be reduced to four days and expected no reduction in earnings. That would mean an effective increase in wages of some 25 per cent., which would be catastrophic not only for Scottish businesses but for British business. All the successes and records being set daily by industry in Scotland would be for nought.
    Sir David Steel: As the Minister responsible for industry, does the hon. Gentleman agree that employment opportunities are directly linked to the quality of education and training in Scotland? Is he aware that, yesterday, Borders regional council had to withdraw free transport for people aged between 16 and 18 attending day-release classes at further education colleges as one of 30 cuts in education in the region? How can the Secretary of State tell the shadow Secretary of State that there have been no cuts in education? Will Ministers stop fantasising about tartan taxes and deal with the situation on the ground?
    Mr. Kynoch: The right hon. Gentleman should be aware that, in fact, there has been a 2.5 per cent. increase in education spending this year. It is up to local councils to decide how to spend their funds. Local councils have asked for more responsibility for, and more choice in what they can do with, the funds that they are given, and they are being given both. We are consulting on areas in which they can take on greater responsibility. They must stand up and be responsible for what they do. They have the
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    opportunity to decide how to spend their money. I hope that they will give priority to the areas to which the right hon. Gentleman referred.
    Mr. Donohoe: The Minister will recall that, last year, I asked a question about the effects of £11 million for urban development being lost from Irvine new town because of the closure of Irvine development corporation. He said that the money would be distributed to local enterprise companies. Why, then, must the LEC in Ayrshire put up with a cut of £2.5 million? In those circumstances, how can industry be promoted in the new town beyond the life of the development corporation?
    Mr. Kynoch: The difference between the hon. Gentleman and his party and the Government is that we recognise that LECs, as with Scottish Enterprise, have levered in a ratio of 3:1 of private funding to public funds. They clearly believe that they can exist with less funding and maintain, through efficiency improvement, the same output—and, indeed, improve on it. If the hon. Gentleman spoke to his LEC he would understand how successful LECs have been. Rather than running down the Ayrshire economy, he should tell the positive stories about Irvine, inward investment into Irvine, and the successes of Ayrshire.

    NHS Staffing Costs
    Ms Rachel Squire: To ask the Secretary of State for Scotland if he will make a statement on NHS staffing costs. [10798]
    Lord James Douglas-Hamilton: Resources available to the NHS for staffing and other costs continue to be higher than ever before. Since 1980, the number of nursing staff has increased by 15.5 per cent., the number of hospital doctors by 21.5 per cent. and the number of general practitioners by 18.7 per cent.
    Ms Squire: Does the Minister agree that the Government's market approach has led to rock bottom morale among NHS staff and a two-tier service for patients? Will he condemn the approaches made to consultants at Glasgow Royal Infirmary NHS trust to give preferential treatment to patients of GP fundholders? Will the Government, for once, stop telling fibs and admit that the NHS is certainly not safe in their hands? [Interruption.]
    Madam Speaker: Order. The hon. Member for Lancaster (Dame E. Kellett-Bowman) seems to be a little perplexed. The Secretary of State used the word fib earlier in a similar context and I allowed it.
    Lord James Douglas-Hamilton: The hon. Lady can be assured that the health service is absolutely safe in the Government's hands. Expenditure has increased substantially. I can give her the reassurance that she seeks in relation to Glasgow. We are absolutely committed to treating all patients equally. All that matters is the recommendation of the clinician as to whether the patient requires urgent treatment. If he or she so recommends, the patient must receive it. The Scottish Office guidelines are

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    clear. The same waiting time guarantee must apply to every patient. I understand that the trust accepted that it issued its questionnaire in error.
    Mrs. Fyfe: Being guaranteed a maximum waiting time is not the same as being told that someone will not be put behind in a queue if a GP fundholder seeks priority. Has the Minister been in touch with Glasgow Royal Infirmary NHS trust today to tell it that it is out of line? If not, why not?
    Lord James Douglas-Hamilton: If the hon. Lady had listened to what I said, she would have heard that I was making it absolutely clear that we do not accept in any circumstances a two-tier health service. Every patient must receive the same priority according to the determination of the clinician concerned. That is stated in our guidelines and that position must be followed. The NHS trust admitted that its questionnaire was issued in error.
    Mr. McAllion: If the Minister thinks that the Scottish Office guidelines are clear, he is the only one who does. Has he read the letter, issued on official notepaper bearing the crest of Glasgow Royal Infirmary NHS trust, in which the medical advisory committee states that it has agreed to take the opinion of all consultants on whether factors other than clinical need should significantly affect the handling of patient care? Does he understand the point that is made in the letter—that the pressure from his imposed internal market and from GP fundholders and other purchasers who are demanding significantly better treatment for their patients has led the trust to consider abandoning the principle of treatment in accordance with medical need? Will he send a clear instruction to every NHS trust in Scotland that patients can be treated in accordance with medical need, and only in accordance with medical need? If he will not do that, both he and the Secretary of State for Scotland should do what one of the Secretary of State's constituents—Mrs. Bowie—called on him to do today in the press and resign, because neither of them, nor any of the other chancers on the Government Front Bench, can be trusted with our NHS.
    Hon. Members: Oh!
    Lord James Douglas-Hamilton: Guidelines have been issued—[Interruption.] The position is absolutely clear—[Interruption.]
    Madam Speaker: Order. Obviously I have missed something. Will the Under-Secretary of State tell me what he is shouting about?
    Mr. Raymond S. Robertson: Is "chancers" parliamentary?
    Madam Speaker: Chancers?
    Mr. Robertson: The hon. Member for Dundee, East (Mr. McAllion) used the word "chancers".
    Lord James Douglas-Hamilton rose—
    Madam Speaker: Order. I did not hear what the hon. Member for Dundee, East said. If the hon. Gentleman said
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    something that might have been unparliamentary, I expect him to develop the point that he made so that I understand completely what he said.
    Mr. McAllion: Madam Speaker, I used a word from Glasgow patois—"chancer". It means that we do not really trust the person who is described as a chancer. I think that it is parliamentary.
    Madam Speaker: I live and learn every day, especially from the Scots. Thank you very much.
    Lord James Douglas-Hamilton: I can tell the hon. Gentleman that there is no element of chance about the fact that more than £30 million has been allocated to the NHS trust in the hon. Gentleman's constituency for an extension to Ninewells hospital. NHS trusts in Scotland represent a remarkable success story in helping to bring down waiting times. As for the Secretary of State's constituent, although because of confidentiality I cannot comment in detail, I understand that she wanted to be treated more quickly than would have been possible on the NHS. There is no reason to suppose that she would have had to wait longer than the guaranteed maximum period for patients. Only clinicians can judge individual need. NHS resources must be made available for those in greatest need.

    Glasgow International Airport
    Mr. Stewart: To ask the Secretary of State for Scotland what analysis he has made of the impact on the economy of the west of Scotland of the development of Glasgow international airport. [10799]
    Mr. Kynoch: I believe that the airport makes an important contribution to the west of Scotland economy, and that is why, as my hon. Friend knows, we support the Glasgow airport initiative, which seeks to maximise the economic benefits of the airport's expansion.
    Mr. Stewart: I am grateful to my hon. Friend for that positive and helpful reply. Does he agree that two key infrastructure developments are crucial to the airport's future—first, the M74 northern extension and, secondly, an eastbound on-ramp for the M8? Can he give an unequivocal commitment to the House today that both those developments will go ahead as soon as possible?
    Mr. Kynoch: I compliment my hon. Friend on his involvement in the setting up of the Glasgow airport initiative in 1992. In answer to his two questions about the roads, I assure him that we shall consider those matters positively and will try to take them forward at the earliest possible time.
    Mrs. Adams: Will the Minister join me in congratulating Glasgow airport on bringing 5,000 jobs to my constituency, but will he also recognise that that is no substitute for the loss of 85 per cent. of the manufacturing jobs in my constituency—about 20,000 jobs—over the same period? Will he now consider investing in manufacturing industry, with the aim of helping the airport to further its business?
    Mr. Kynoch: I am glad that the hon. Lady recognises the contribution that the airport initiative has made. I have

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    seen a similar initiative in the United States—the Washington airport task force, which has contributed towards a good joint venture arrangement between software houses in the United Kingdom, including Scotland, and in Virginia. I believe that the Glasgow airport initiative has been ably set up to develop similar arrangements.
    As for manufacturing, the hon. Lady may be aware of the jobs that have been created by Locate in Scotland in the past year. About 12,300 jobs have been created, involving 97 projects and £1.1 billion in capital investment. The transformation of the Scottish economy from some of the traditional industries of the past towards the industries of the future—we now produce about 11 per cent. of Europe's semiconductors, 35 per cent. of its personal computers, 50 per cent. of its automated banking machines and 60 per cent. of its workstations—is all positive information about successes for the Government and for our policies.

    EC Council of Ministers
    Mr. Duncan Smith: To ask the Secretary of State for Scotland if he has recently attended a meeting of the EC Council of Ministers. [10801]
    Mr. Raymond S. Robertson: My right hon. Friend attended a meeting of the Council of Fisheries Ministers on 26 October 1995, and I attended on 21 and 22 December 1995.
    Mr. Duncan Smith: When my hon. Friend returns from the next European Council of Ministers meeting,
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    will he go on a special tour of Scotland to remind all of those who are selling the idea that Scotland will be able to cast itself adrift from the UK and that all the tax money that is spent and the trade that is conducted in Scotland by the rest of the UK could be replicated and replaced by Europe are talking utter nonsense? Would not such a course lead to bankruptcy and higher taxation?
    Mr. Robertson: I can assure my hon. Friend that my right hon. Friend and all my Scottish Office colleagues regularly travel to all parts of Scotland. Indeed, my right hon. Friend has just returned from two days in Shetland at the Up Helly-a celebrations. My hon. Friend is right to suggest that Scotland punches well above its weight in the councils of Europe and the world as a full and equal partner in this United Kingdom. That is in stark contrast to the immediate belittling of Scotland that is on offer from the SNP or the gradual marginalisation that is offered by Labour and the Liberal Democrats.
    Mr. Maxton: When the Minister and the Secretary of State attend meetings of the Council of Ministers, do they discuss with their Spanish, German and French colleagues the development of regional government within these areas and the importance of devolution to their economies?
    Mr. Robertson: I can assure the hon. Gentleman that we discuss those matters—our Spanish counterparts are most concerned about having one of the worst unemployment rates in the EU.

Points of Order
3.30 pm
Mr. Norman Hogg: On a point of order, Madam Speaker. You will have noticed that question No. 175 appears on the Order Paper today in the name of the hon. Member for Dover (Mr. Shaw). The question appears to have been placed on the Order Paper to elicit the result of the inquiry to which the question refers. This is a matter of immense importance that should have been dealt with either by a statement to the House or by an oral answer from the Secretary of State for Scotland. All Scottish Members are here and, while we have plenty to do, we could hear the answer to that question orally. Is there a procedure whereby that question can be answered now so that we can debate the matter now?
Madam Speaker: There is no procedure whereby the hon. Member can secure an oral answer to that question. I have not heard that any Minister is seeking to answer it orally or to make a statement on the matter.
Mr. Bill Walker: On a point of order, Madam Speaker. I rise to draw your attention to the fact that the European Commissioner for Transport has today approved the expenditure of —440 million of public funds in aid to the state airline of Spain, Iberia. This will have a damaging impact on UK airlines. Is there any way in which the House can debate this matter, because British taxpayers' money will be used to damage British interests?
Madam Speaker: The hon. Gentleman may like to raise the matter with the Leader of the House during Business Questions if he is seeking a debate on this or other matters.
Mrs. Alice Mahon: On a point of order, Madam Speaker. It has been widely reported today that senior judges—including a former Master of the Rolls—have criticised the Home Secretary for playing politics with the administration of justice. Given the gravity of these accusations, has the Home Secretary indicated to you whether he intends to come and give an explanation to the House?
Madam Speaker: No. As I said earlier, I have not heard from any Minister that we will be having a statement today on any of those issue.
Mr. Brian Wilson: Subsequent to the point of order of my hon. Friend the Member for Cumbernauld and Kilsyth (Mr. Hogg),Madam Speaker—
Madam Speaker: Order. The hon. Gentleman and the House know that once a point of order has been dealt with, it must rest there. I have given my answer to that point of order.
Mr. Wilson: It is a different point of order.
Madam Speaker: The hon. Gentleman said that it related to the point of order raised by the hon. Member for Cumbernauld and Kilsyth. He cannot have it both ways.
Mr. Tam Dalyell: On a point of order, Madam Speaker.
Madam Speaker: The hon. Member for Cunninghame, North (Mr. Wilson) might like think about a different point of order while I deal with the hon. Member for Linlithgow.
Mr. Dalyell: While it is quite right, Madam Speaker, to say that there is no procedure available in such cases, used there not to be a convention that—at least as a courtesy to the House—Ministers who knew that controversial statements were due to be made placed them in the Library at two o'clock at the latest?
Madam Speaker: That is a decision for Ministers to make, not one for the Speaker.
Mr. Wilson rose—
Madam Speaker: Is it a different point of order?
Mr. Wilson: Yes, Madam Speaker. I used the word "subsequent" in a purely chronological sense.
The question on the Order Paper refers to a specific local authority. I was under the impression that, according to a convention of the House, any such specific reference should be made by an hon. Member representing the area concerned. The fact that the question was tabled by the hon. Member for Dover—
Madam Speaker: Order. That is not a point of order for me. I think that the House knows the answer to that one.

BILL PRESENTED
  PROTECTION OF PRIVACY
  Sir Patrick Cormack presented a Bill to make it an offence to sell or to buy tapes or transcripts of private conversations otherwise than with the consent of both parties; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 14 February and to be printed. [Bill 50.]

Regulation of Funding of Political Parties
3.35 pm
Mr. John Spellar: I beg to move,
That leave be given to bring in a Bill to regulate the funding of political parties.
The Bill would require the disclosure of the source of donations, prohibit donations from overseas sources and require the publication of accounts.
Once again, the funding of political parties is on the agenda, put there by no less a person than the Prime Minister. Only last Thursday, at Prime Minister's Question Time, he raised the question of Labour party funding when he said:
"We know who pays 50 per cent. of the money that the Labour party gets."—[Official Report, 25 January 1996; Vol. 270, c. 476.]
He was quite right: we do all know.
The Prime Minister seems very keen to publicise the source of funding of the Labour party—and why not? It is no secret. Party accounts make it quite clear, and the law makes strict provision with regard to the operation of trade union political funds. Unfortunately, no such transparency applies to the funding of the Tory party. Shrouded in mystery and obscurity, a host of secretive companies and organisations were created after the war to funnel secret loot into the Tory party, and our Prime Minister seems to want to keep it that way. What a perfect example of saying one thing and doing another.
The Bill is a simple measure. It has three main aims—to prohibit donations from foreign nationals not normally resident in this country and from overseas companies and Governments; to ensure the recording and publication of donations above a certain limit—I am not tied to a particular figure, but the limit would probably be about £1,000; and to require political parties to publish full income and expenditure accounts in the same way as companies and trade unions.
The issue is so unremarkable that in 1949 the House passed a motion requiring parties to publish accounts. Unfortunately, it has not yet been properly activated by the Tory party. We know that the matter is of considerable concern not just to Opposition Members but to many members and supporters of the Tory party. It may also be of interest to those who do their business with the Royal Bank of Scotland, which seems to have allowed the Tory party a huge overdraft—at one stage hitting nearly £16 million. My Scottish colleagues may wonder whether small businesses that bank with the Royal Bank of Scotland receive such helpful treatment if they encounter cash-flow crises in their day-to-day affairs.
Publication might also help the Prime Minister, who was very confused about the sources of Tory funding a couple of years ago. He now ducks questions about the use of Downing street for Tory party functions. I have here an invitation to the winter ball in aid of Conservative party marginal seats, which states:
"You will shortly be receiving (or may already have received) an invitation to the launch reception at 10 Downing Street."
The Prime Minister has even less idea of what is going on around the country. When I raised the point with him at Question Time on 19 October 1993, he said that he must let me into a secret:
"There are a great many secret sources and they are all cheese and wine parties up and down the country."—[Official Report, 19 October 1993; Vol. 230, c. 144.]
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One wonders how much wine and cheese the Tories stuffed into that fugitive from justice, Asil Nadir, who, as they have now admitted, donated more than £400,000. One wonders whether they will pay that money back to the unfortunate people who lost heavily in the crash of Polly Peck. One also wonders why they could not confirm the donation immediately, and why they were careless enough to dump the records of donations so that they were unable to provide the receiver with facts and figures. And one must wonder whether they will repay the money donated by ex-Nissan boss Octav Botnar, who is currently hiding in Switzerland to evade the attentions of the Inland Revenue. What about Mr. Virani—another heavy donator to Tory funds who ended up inside? Who are the real villains' friends here—Botnar, Virani and Nadir?
There might also be concern as to how much foreign business men, particularly Greek shipowners, have donated. We could then match the figure with the amount lost to the Treasury each year through the tax loophole that benefits them—foreign domicile tax status. It is an interesting provision and such an unusual arrangement that we are one of only four countries in western Europe to have it. The others are Switzerland, Luxembourg and the Channel Islands, which are all well-known tax havens.
It would also be instructive to find out how much money has come from Hong Kong. It appears that the Tories have still not shaken off that habit. Even this year, it is reported that the Foreign Secretary attended fund-raising meetings during his recent visit, even though one presumes that his trip to Hong Kong was funded by the British taxpayer. One wonders whether, following the deterioration of relations between China and Britain, Hong Kong business men were as generous with their donations as they have been, but that will not stop that lot trying to get money from them.
What is remarkable is that legislation forbidding foreign donations has been in place in the United States, Germany, Canada and other countries for some years and is accepted as normal. The British public have a right to know whether one of the main political parties is in hock to foreign business men, companies or, indeed, countries.
The publication of donations was introduced a number of years ago in the United States, which was followed by other countries, including Australia. It does not seem to provide any particular difficulties for them. Is not it surprising that the Conservatives are so keen to invoke the right to silence in this case? Of course, they might be following the precept that they chant regularly from the Dispatch Box that, "Those who have nothing to hide have nothing to fear." Perhaps they are concerned that people might detect—how can I put it delicately—a strong statistical correlation between donations to the Tory party and the provision of knighthoods, peerages, and now, places on quangos, let alone ministerial access for companies.
That highlights the problem that the Tories face. They are kept together only by their monopoly of patronage through honours, quangos and political favours. They are a narrow oligarchy clinging to central state power, propped up by a few high-spending companies and individuals and by foreign interests. More and more, their previous supporters in industry and construction are deserting them, as they realise the harm that is being done to their businesses by Government policy.

1005
Even Lord McAlpine, the previous treasurer of the Tory party, said only this week that the construction industry must
"explain to the government how its handling of the British economy has, over the past five years, systematically destroyed Britain's construction industry, and that this has to stop."
Even that industry is deserting in the face of the Government's actions. Frankly, the Conservative party is knackered.
It was most instructive to watch the programme on Tory wives the other month. Look at what happened when they held constituency functions. Nearly all the participants were pensioners. That graphically illustrated what has been reported in the press, particularly The Daily Telegraph—that the Tory party is an elderly and aging party with an average age of 60. New blood is not coming into the party. Lots of those who stay do so only to belong to Conservative clubs, which reputedly have the best snooker tables. The Young Conservatives, which was once the largest youth movement in Europe outside the Komsomol, is down to 5,000 members and half of them are barmy. That is why the Tory party has had to cancel its youth conference. Meanwhile, the young Labour movement is at 25,000 and roaring ahead.
At councillor and Member of the European Parliament levels, Tory representatives are becoming an endangered species. That is why the Tories have to seek out and cover up the supply of dodgy money. The Bill is aimed at cleaning up the financing of British politics and ensuring that British parties are not up for sale. It would be considered normal in our fellow democracies and will be considered common sense by the voters of this country and I commend it to the House.
3.43 pm
Mr. David Shaw: I oppose this Bill on the regulation of the funding of political parties. It contains more than a whiff of hypocrisy. The stench of hypocrisy surrounding it is much like that of the sewers before we privatised the water companies.
One objective of the Bill is to move Britain towards the state funding of political parties. That would be extremely damaging but Labour would like to do it. It is not about regulating those who financially support political parties but about keeping secret the millions of pounds of trade union support to Labour that would fall outside its terms. It is a classic case of Labour saying one thing and doing another.
Labour talks about disclosure of party funding and openness. The hon. Member for Warley, West (Mr. Spellar) said that there is no secrecy about Labour party funds. That statement is not true. There is a lot of secrecy when one starts to look at Labour party accounts. The Labour party makes many statements about disclosure and openness, but it says one thing and does another. The hon. Gentleman's entry in the Register of Members' Interests shows that he receives trade union funding from two sources but there is no disclosure of or openness about the amount of money that he gets from them. He is guilty of saying one thing and doing another.
The Conservative party's openness is revealed by the extent of the information that the hon. Member for Warley, West has been able to find. As he knows, we in the Conservative party go to a lot of wine and cheese parties and chicken dinners. Sometimes the cheese is not
1006
up to scratch; sometimes the chicken is not as nice as we would like it to be. But we know that we are raising an honest penny for the Conservative party's coffers. We do not pick up the phone, as does the Labour party, to call a friendly trade unionist to get thousands of pounds. We do the hard work of going around the chicken and cheese circuit to get money for the Conservative party.
I invite hon. Members to look at the Labour party's national executive committee reports. In the 1986 report they will find an advertisement by Robert Maxwell—funding the Labour party. If they look again, they will find an advertisement for a Soviet book shop—funding the Labour party. There was no reference in the speech of the hon. Member for Warley, West to the member of the other House who sits on the Labour Front Bench and who took £250,000 of pensioners' money three weeks before Robert Maxwell jumped overboard. That is how the Labour party and its Members fund themselves.
There is worse than that. The latest accounts of the Labour party reveal that 57 per cent. of its funds come from the trade unions. However, that is 57 per cent. of what we are told about. There are many entries in the Labour party's accounts that cannot be reconciled. For example, I have here some leaked minutes of the National Trade Union and Labour Party Committee. Donations called affiliation fees from trade unions add up to £3.6 million. The Labour party's accounts give the figure as £6.6 million. There is a lot of difference between £ 6.6 million and £3.6 million. Where is the £3 million?
Mr. Bruce Grocott: On a point of order, Madam Speaker.
Mr. Shaw: Where are the extra affiliation fees that the Labour party does not disclose in its accounts?
Madam Speaker: Order. I have a point of order.
Mr. Grocott: The hon. Gentleman is clearly arguing in favour of greater disclosure of party funding details, which is exactly what the Bill is about. He is making a speech in favour of the Bill which masquerades as one against it.
Madam Speaker: I do not interpret the speech of the hon. Member for Dover (Mr. Shaw) in that way. He is keeping himself in order. He has another minute or two in which to finish.
Mr. Shaw: I am grateful for your support, Madam Speaker.
If we consider the trade union figures, we find no openness and disclosure. The minutes of the meeting say that Unison's donation to the Labour party is £700,000, but, when one goes to Unison's accounts£buried away on a page that is difficult to find, somewhere in the middle of a 50-page document£one finds that the figure is £1,989,000, equivalent to one sixth of Labour party expenditure.
That is not the whole story. The Labour party receives more money from Unison than is disclosed in that figure. Another £94,000 is disclosed as being for parliamentary activities. Once upon a time, we were told that the Labour party would disclose how that figure is made up, and that we would find out which Front-Bench Labour Members

1007
are receiving the money, but no such disclosures have yet been made. In that regard, Labour Front-Bench Members are guilty of saying one thing and doing another.
The Labour party does not disclose five other funds in its central accounts. The Industrial Research Trust, once mentioned in disclosures of the Leader of the Opposition and the deputy leader in the Register of Members' Interests, has now been excluded from public view and taken out—another example of saying one thing and doing another. No details are available for public scrutiny on the Labour leader's office fund—another example of saying one thing and doing another.
There are no disclosures of what the Lionel Cooke Memorial Fund is, of the details, of donors and of the size of donations. There are no disclosures of the details of the National Trade Union and Labour Party Committee funds, of the donors and of the size of donations. That is an example of the Labour party saying one thing about openness and disclosure, but doing another. [HON. MEMBERS: "Hypocrisy"] My hon. Friends may say the word "hypocrisy": I could not possibly comment.
The Labour party is in trouble. If we consider its membership and the NEC report, we find that the Labour party boasts an 85 per cent. retention rate. If we turn that statistic around, however, it means that 15 per cent. of the Labour party membership are either dying each year or are failing to renew their membership. The Labour party retains its members only for about six years on average and then they get fed up with the Labour party. The NEC report says:
"The party's growth in membership"
has brought
"little financial benefit centrally".
There is still a high dependency on the trade unions in Labour party financing.
The Bill should be opposed because it is full of hypocrisy by the Labour party. In his speech, the hon. Member for Warley, West, in common with his Front-Bench colleagues, has been saying one thing and doing another.
Question put, pursuant to Standing Order No. 19 (Motions for leave to bring in Bills and nomination of Select Committees at commencement of public business):—
The House divided: Ayes 163, Noes 62.

Division No. 41]

[3.52 pm

AYES

Adams, Mrs Irene

Burden, Richard

Allen, Graham

Byers, Stephen

Armstrong, Hilary

Callaghan, Jim

Ashdown, Rt Hon Paddy

Campbell, Mrs Anne (C'bridge)

Ashton, Joe

Campbell, Menzies (Fife NE)

Banks, Tony (Newham NW)

Campbell-Savours, D N

Beith, Rt Hon A J

Canavan, Dennis

Benn, Rt Hon Tony

Cann, Jamie

Bennett, Andrew F

Chidgey, David

Benton, Joe

Chisholm, Malcolm

Betts, Clive

Clapham, Michael

Bradley, Keith

Clarke, Eric (Midlothian)

Bray, Dr Jeremy

Clelland, David

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

Clwyd, Mrs Ann

Bruce, Malcolm (Gordon)

Connarty, Michael

1008

Corston, Jean

Madden, Max

Cousins, Jim

Mahon, Alice

Cox, Tom

Marek, Dr John

Cummings, John

Marshall, David (Shettleston)

Cunliffe, Lawrence

Marshall, Jim (Leicester, S)

Cunningham, Jim (Covy SE)

Martin, Michael J (Springburn)

Dalyell, Tam

Martlew, Eric

Davidson, Ian

Maxton, John

Davies, Bryan (Oldham C'tral)

Meale, Alan

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

Michie, Bill (Sheffield Heeley)

Davies, Ron (Caerphilly)

Miller, Andrew

Denham, John

Morgan, Rhodri

Dixon, Don

Morley, Elliot

Dobson, Frank

Morris, Rt Hon Alfred (Wy'nshawe)

Donohoe, Brian H

Mudie, George

Dowd, Jim

Mullin, Chris

Eastham, Ken

Murphy, Paul

Etherington, Bill

O'Brien, William (Normanton)

Evans, John (St Helens N)

O'Hara, Edward

Ewing, Mrs Margaret

Olner, Bill

Flynn, Paul

Orme, Rt Hon Stanley

Foster, Rt Hon Derek

Parry, Robert

Foster, Don (Bath)

Pendry, Tom

Foulkes, George

Pickthall, Colin

Fyfe, Maria

Pike, Peter L

Galbraith, Sam

Pope, Greg

Gapes, Mike

Powell, Ray (Ogmore)

Garrett, John

Prentice, Bridget (Lew'm E)

Godman, Dr Norman A

Purchase, Ken

Godsiff, Roger

Radice, Giles

Golding, Mrs Llin

Randall, Stuart

Griffiths, Nigel (Edinburgh S)

Rendel, David

Grocott, Bruce

Roche, Mrs Barbara

Gunnell, John

Rooker, Jeff

Hain, Peter

Ross, Ernie (Dundee W)

Hall, Mike

Ruddock, Joan

Hanson, David

Salmond, Alex

Hardy, Peter

Sheerman, Barry

Hinchliffe, David

Sheldon, Rt Hon Robert

Hogg, Norman (Cumbernauld)

Skinner, Dennis

Home Robertson, John

Spearing, Nigel

Hood, Jimmy

Spellar, John

Hoon, Geoffrey

Squire, Rachel (Dunfermline W)

Hoyle, Doug

Steel, Rt Hon Sir David

Hughes, Roy (Newport E)

Steinberg, Gerry

Hughes, Simon (Southwark)

Stevenson, George

Hutton, John

Stott, Roger

Ingram, Adam

Sutcliffe, Gerry

Jackson, Glenda (H'stead)

Taylor, Mrs Ann (Dewsbury)

Jackson, Helen (Shef'ld, H)

Taylor, Matthew (Truro)

Janner, Greville

Tipping, Paddy

Jones, Barry (Alyn and D'side)

Touhig, Don

Jones, Jon Owen (Cardiff C)

Turner, Dennis

Jones, Martyn (Clwyd, SW)

Tyler, Paul

Kaufman, Rt Hon Gerald

Walker, Rt Hon Sir Harold

Khabra, Piara S

Walley, Joan

Kilfoyle, Peter

Wareing, Robert N

Litherland, Robert

Watson, Mike

Lloyd, Tony (Stretford)

Wigley, Dafydd

Llwyd, Elfyn

Williams, Rt Hon Alan (Sw'n W)

Lynne, Ms Liz

Williams, Alan W (Carmarthen)

McAllion, John

Wilson, Brian

McAvoy, Thomas

Winnick, David

Macdonald, Calum

Wray, Jimmy

McFall, John

Wright, Dr Tony

McKelvey, William

Mackinlay, Andrew

Tellers for the Ayes:

MacShane, Denis

Mr. Harry Barnes and

Ms Angela Eagle.

NOES

Alexander, Richard

Beggs, Roy

Alison, Rt Hon Michael (Selby)

Booth, Hartley

Ashby, David

Brown, M (Brigg & Cl'thorpes)

Atkins, Rt Hon Robert

Carrington, Matthew

Atkinson, David (Bour'mouth E)

Cash, William

Banks, Matthew (Southport)

Channon, Rt Hon Paul

1009

Chapman, Sir Sydney

Patnick, Sir Irvine

Dover, Den

Pattie, Rt Hon Sir Geoffrey

Duncan-Smith, Iain

Pawsey, James

Dunn, Bob

Porter, David (Waveney)

Forsythe, Clifford (S Antrim)

Riddick, Graham

Fry, Sir Peter

Ross, William (E Londonderry)

Gallie, Phil

Shaw, David (Dover)

Greenway, Harry (Ealing N)

Shepherd, Sir Colin (Hereford)

Greenway, John (Ryedale)

Skeet, Sir Trevor

Hamilton, Neil (Tatton)

Smith, Sir Dudley (Warwick)

Hargreaves, Andrew

Smyth, The Reverend Martin

Harris, David

Sweeney, Walter

Hughes, Robert G (Harrow W)

Taylor, Rt Hon John D (Strgfd)

Hunt, Rt Hon David (Wirral W)

Thomason, Roy

Hunter, Andrew

Thompson, Sir Donald (C'er V)

Jessel, Toby

Townend, John (Bridlington)

Kellett-Bowman, Dame Elaine

Townsend, Cyril D (Bexl'yh'th)

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

Tracey, Richard

Lamont, Rt Hon Norman

Tredinnick, David

Lawrence, Sir Ivan

Twinn, Dr Ian

Leigh, Edward

Walker, Bill (N Tayside)

McCrea, The Reverend William

Winterton, Nicholas (Macc'fld)

Marshall, John (Hendon S)

Martin, David (Portsmouth S)

Tellers for the Noes:

Mitchell, Sir David (NW Hants)

Mr. Paul Marland and

Montgomery, Sir Fergus

Mr. Jaques Arnold.

Neubert, Sir Michael

Onslow, Rt Hon Sir Cranley

Question accordingly agreed to.
Bill ordered to be brought in by Mr. John Spellar, Mrs. Barbara Roche, Mr. Mike O'Brien, Mr. David Winnick, Ms Angela Eagle, Mr. D.N. Campbell-Savours, Mr. Andrew Mackinlay, Mr. Gordon McMaster, Mr. Chris Mullin and Mr. Denis MacShane.

Regulation of Funding of Political Parties

  REGULATION OF FUNDING OF POLITICAL PARTIES
  Mr. John Spellar accordingly presented a Bill to regulate the funding of political parties: And the same was read the First time; and ordered to be read a Second time upon Friday 19 April and to be printed. [Bill 51.]
  Mr. David Winnick: On a point of order, Madam Speaker. In view of the substantial majority
  1010
  in favour of my hon. Friend the Member for Warley, West (Mr. Spellar) being given permission to bring in the Bill and bearing in mind the importance of the subject—which we have been debating on and off for the past 12 to 18 months—can the Nolan Committee be notified of the House's decision? It is an important point and I see no reason why the views of the House, as expressed just now, should not be relayed formally to the Nolan Committee by the Clerks.
  Madam Speaker: The Nolan Committee has its own terms of reference to which it works, as I am sure the hon. Member for Walsall, North (Mr. Winnick) is aware.
  Dame Elaine Kellett-Bowman: Further to that point of order, Madam Speaker. May I point out to the House that the Division figures are unbalanced by the fact that parliamentary private secretaries cannot vote?
  Madam Speaker: Order. I am not in the habit of allowing one point of order to run on and become a debate. I can accept another point of order only if it is on a different matter. It is a waste of the House's time, if they are not points of order.
  Mr. Bruce Grocott rose—
  Madam Speaker: Does the hon. Member for The Wrekin have a point of order on another matter?
  Mr. Grocott: My point of order is about the credibility of the Division figures.
  Madam Speaker: We do not need to know about the credibility of the figures: they are there for all to see. A majority of one constitutes a win in our democracy, and that is the end of the matter.

Orders of the Day

  Local Government Finance
  4.5 pm
  The Secretary of State for the Environment (Mr. John Gummer): I beg to move,
  That the Local Government Finance Report (England) 1996–97 (House of Commons Paper No. 164), which was laid before this House on 29th January, be approved.
  I understand that with this, it will be convenient to discuss the following motions:
  That the National Parks Supplementary Grant Report (England) 1996–97 (House of Commons Paper No. 167), which was laid before this House on 29th January, be approved.
  That the Limitation of Council Tax and Precepts (Relevant Notional Amounts) Report (England) 1996–97 (House of Commons Paper No. 166), which was laid before this House on 29th January, be approved.
  That the Special Grant Report (No. 16) (House of Commons Paper No. 165), which was laid before this House on 29th January, be approved.
  On 30 November, I issued my settlement proposals for consultation. They included the total provision for local authority spending, the level of central support for that expenditure, and my proposals for calculating standard spending assessments—the SSAs. I also announced provisional capping criteria. My right hon. and learned Friend the Home Secretary also announced his proposals for police specific grant on 30 November.
  Since then, my colleagues and I have received written representations from 250 local authorities, and have met delegations from 84. We have carefully considered all the points that were raised with us during consultation. Our final decisions in respect of grants and notional amounts are embodied in the reports before the House today. I will also remind the House today of my provisional capping criteria.
  Mr. Jeff Rooker: The Secretary of State has made great play of the enormous consultation process that he has undertaken, and I do not criticise him for that. However, I must raise two points in relation to the city of Birmingham. The first concerns the extra population from Frankley Beeches and fact that the deprivation index for the county of Worcester and Hereford rather than that for Frankley Beeches was used, which has cost Birmingham £1.6 million.
  My second point concerns the way in which capital financing is examined in the standard spending assessment. A notional amount rather the actual capital debt of an authority is taken, which has apparently cost Birmingham city council £30 million. Those points were raised with the Secretary of State during the consultation process. Why did he not take them on board?
  Mr. Gummer: There have been three delegations from Birmingham, and I had the pleasure of meeting the leader of Birmingham city council and talking through the matters. The point about the estate that was transferred from Hereford and Worcester to Birmingham was raised with me. However, in later discussions, it was discovered that the figures were not as the hon. Member for cited, and in fact Birmingham felt that our suggestion was the better answer.
  1012
  I do not think that it would be sensible for the hon. Gentleman to press the matter, as the figures were based on something that did not proceed. The transfer arrangements are agreed between the Government and the local authority association, so the hon. Gentleman would find it difficult to pursue the matter.
  I told Birmingham that, if it wanted to continue, and if it could persuade the local authorities to propose a change, I would not be averse to altering the system. The system is agreed between local authorities because it is about the transference of amounts between local authorities and not about the total amount, as the hon. Gentleman would agree. I made that offer to Birmingham, but in retrospect the council decided that it would not be better.
  Mr. Roy Thomason rose—
  Mr. John Greenway rose—
  Mr. Gummer: The hon. Member for Birmingham, Perry Barr (Mr. Rooker) has asked me two serious questions with which I wish to deal. I should be grateful if my hon. Friends could wait a minute.
  We have been discussing notional amounts for some time. I am sure that the hon. Member for Perry Barr understands that, if one local authority—I cast no aspersions—spends a great deal and has built up a huge debt in the past, and another has been extremely careful and prudent, it would be unfair if the system meant that the first authority, however much it continued to spend, was bound to do better than the prudent authority, irrespective of need. That is why we fix notional amounts. That is the only fair way to cope with that genuine difficulty. We cannot have a situation in which the provident always find themselves at a disadvantage to the improvident.
  The hon. Member for Perry Barr said that a local authority had lost some money. That was a curious use of the word "lost", because the authority never had that money. Birmingham council—I shall be direct—has a long record of spending much more money than it is able to finance. It is asking all the other local authorities to pay for that, but that is not fair, and there must be an intervening system.
  Mr. Thomason: The area of Frankley, to which the hon. Member for Birmingham, Perry Barr (Mr. Rooker) referred, is in my constituency. It is the Frankley estate, not Frankley Beeches.
  Hereford and Worcester, the area from which Frankley has now been removed, has been left with no plus factors in the standard spending assessment calculations, except for a small sparsity factor in Herefordshire. The area is not untypical, compared with other authorities.
  I do not disagree with my right hon. Friend's proposed figures, but the calculation bears hard on those areas of the country that do not have any deprivation factors which add to the distribution of grant. Those areas are left with relatively small sums, and they feel that they have missed out in the overall distribution.
  Can my right hon. Friend confirm that the Department of the Environment intends to review the formulae and the mechanisms for distribution of grant every year on the basis of the evidence that it receives?
  Mr. Gummer: My hon. Friend is right. Hon. Members' attitudes, irrespective of party, to the division

  1013
  of grant are always affected by how it hits their areas. The deprivation factors are important, and I am sure that my hon. Friend would not want us to have a system that did not take deprivation into account.
  I will confirm that, every year, we reconsider the system with the local authorities. When my hon. Friend the Minister for Local Government, Housing and Urban Regeneration sums up, he will describe in detail our next step. We have also agreed to have an independent review of the way in which we deal with some of the extra costs. I will cover that myself.
  Several hon. Members rose—
  Mr. Gummer: I have managed so far to read only the titles of the reports and two paragraphs, so I shall continue for a moment before giving way.
  As I made clear when announcing the provisional settlement, all public expenditure programmes have to be rigorously examined each year. Local government spending is no exception. Within the objectives for the economy as a whole, I have looked very hard both at the pressures on local government spending and at the scope for greater efficiency and effectiveness within authorities. As in previous years, I am grateful for the practical help that the local authority associations have given in setting out and discussing issues.
  I announced on 30 November 1995 a proposed total standard spending—TSS—for England for 1996–97 of £44.92 billion. In the light of consultation, we have now adjusted that figure slightly to reflect developments in the first phase of nursery vouchers and in the balance of police grant between England and Wales. The result is that the final TSS figure for England for 1996–97 will be £44.93 billion.
  It is worth remembering just how much money that is. It represents a significant amount of public expenditure, and it cannot be ignored, considering the amount that the Government and local government spend from individuals' pockets. All parties are now committed—at least in words—to the restraint of public expenditure, so that amount has to be considered in the same way as any other major amount. It is, apart from central Government expenditure, the largest part of expenditure.
  Local government will, of course, be able to spend more than that, because its spending accounts for a quarter of all public expenditure. Councils can spend above the TSS, up to their capping limits, and can, of course, make use of income from fees and charges and can spend from reserves.
  Several hon. Members rose—
  Mr. Gummer: I will give way, but I want to make clear a point that is often not understood outside; sometimes I fear that it is purposely not understood.
  First, there is the TSS. As I have said, it is possible to spend more than that, up to the capping limits, by raising more on the council tax. There are other ways in which councils can spend; either from fees or from reserves. So it is always true that, at the end of the year, councils have spent more than the TSS at the beginning of the year. That means that, if we wish to compare like with like, we must compare the year end spending with the following year end spending, or the TSS at the beginning of the year with the TSS at the beginning of the succeeding year.
  1014
  One cannot compare one set of TSS figures with one set of spending figures. Those of us involved in local government know that, but sometimes that mistake is made. I want to ensure that it does not occur in our discussions, because it shows a lack of understanding of the local government system. I do not want to accuse anybody of that, but sometimes that is the basis for argument.
  Mr. Elliot Morley: The Secretary of State is talking about comparisons. What happens with a new unitary authority where making comparisons is difficult? For my new authority of North Lincolnshire, the standard spending assessment will mean cuts across the board—an 8 per cent. cut in education, for example—and a substantial increase in council tax. That authority inherits no balances, and is very much dependent on the standard spending assessment laid down by the Department of the Environment.
  The Secretary of State has received delegations from the authority, which made the not unreasonable request for capital borrowing over three years to mitigate the cost of the reorganisation, as well as to help deal with the problems of establishing itself as a new authority. That request has been refused. In those circumstances, does the Secretary of State accept that the education cuts are a direct result of his Department's policy, and have nothing to do with North Lincolnshire, which is a brand new authority with no track record?
  Mr. Gummer: There are difficulties when one is transferring from an authority such as Humberside, which has a long history of excessive expenditure. It is difficult for one or two such authorities to move to the new structure without carrying something with them. They carry the history of a lack of efficiency in the services taken over. That has disadvantages, but it has an advantage, in that it may be possible to make significant savings in the running costs.
  There is a whole range of provisions. One of the reasons for notional amounts rather than historic figures is that they take into account problems such as those raised by the hon. Member for Glanford and Scunthorpe (Mr. Morley). There is a damping grant should the council tax become excessive.
  I am happy to look again at any of the points raised by the hon. Gentleman. The system is designed to help, but I must tell the hon. Gentleman that his circumstances are made worse by the previous management, which was one of the worst in the country—it was recognised as such. Humberside is an unlamented lost county.
  Mr. John Greenway: May I move my right hon. Friend slightly further north, to deal again with reorganisation? I thank my right hon. Friend, the Ministers and the officials for the helpful way in which they have considered how best to redistribute money in North Yorkshire out of the creation of the new York unitary authority. The county council has done rather better than many of us feared. That must be put on record.
  However, is my right hon. Friend aware that we still have a problem with Ryedale district council, which has a notional amount that is almost £750,000 more than the SSA? My right hon. Friend mentioned the use of reserves. Is there any way at this stage in which we could bridge

  1015
  that gap without the whole cost falling on the council tax payers in Ryedale, because the sums that they will have to pay are substantial?
  Mr. Gummer: My hon. Friend is perfectly right. I would look sympathetically at a request from Ryedale district council to capitalise some of those costs, which would help it considerably. Unfortunately, it has not yet made such a request, and I cannot respond to a request that has not been made. I hope that my hon. Friend will remind the council that it is a perfectly reasonable way to do things—indeed, the way we expect them to be done. If the case can be supported, I shall consider it carefully.
  Mr. William O'Brien: I appreciate being given the opportunity to intervene. Will the right hon. Gentleman take account of the position in my constituency, where deprivation is severe because of the closure of the mining industry and the ancillary works that supplied it?
  Wakefield district council has brought in fees and charges over the past five or six years because of the restrictions imposed by the Secretary of State. It cannot simply keep charging local people, who can ill afford to pay because of problems such as unemployment. Will he reconsider the problems, so that we can be allowed to provide the services in education and community care that people demand?
  Mr. Gummer: The hon. Gentleman knows that I have a reasonable knowledge of Wakefield, and I recognise the problems in the area. I am sure that he will agree that, in recent years, we have given Wakefield and the surrounding area extra help in a number of ways. Of course I will examine the points that he has raised. Although we have reached a conclusion on these matters in a number of areas, I am happy to reconsider, because I recognise the problems to which he referred.
  Within the system, a significant amount of money is being diverted because of the factors that the hon. Gentleman mentioned. That is why some areas, such as Wakefield, do better than other areas where the resources and opportunities are greater. I shall consider the particular points that he raised.
  Mr. Richard Tracey: In my right hon. Friend's introductory remarks, he mentioned his joint responsibility with our right hon. and learned Friend the Home Secretary for the police service, but he did not mention the fire service. He is aware that worries have been expressed in various quarters about fire cover for London, and the possibility that the reduction in the fire service's SSA will disadvantage its ability to provide cover.
  Will my right hon. Friend give a categorical assurance that fire cover is wholly adequate in London, and that that will in no way be disadvantaged by the reduced SSA?
  Mr. Gummer: As the Minister with responsibility for London, I naturally consider these matters very carefully. I today responded to a Labour Member who has written to me on the very issue my hon. Friend raised.
  The fact is that, next year, the authority's SSA will increase by more than £1 million, to £253.6 million. It will have by far the highest SSA per head of any single-purpose
  1016
  fire authority. London does better than any other single-purpose fire authority. Other areas throughout the country note that London has been given additional resources.
  The proposed capping limit would allow the authority to increase its budget by more than £5 million compared with this year, which would take its budget more than 2 per cent. above its SSA. The authority's decisions will be very much in its own hands.
  About 22 per cent. of the authority's work force are support staff behind the front-line services, Perhaps it could look for ways to make savings there. Perhaps it could look more closely at some of its accommodation and resources that are not being used. There is a wide range of things that it can do. The money provided to the authority certainly ensures that it can give fire cover. Indeed, it would not be allowed to close any installation without my right hon. and learned Friend the Home Secretary being sure that there is still fire cover.
  I reassure my hon. Friend on the matters that he raised by pointing to the facts that the authority has been allocated extra money and that London is specifically advantaged by that provision.
  Mr. Frank Dobson: Does the Secretary of State accept that the London fire brigade's standard of performance over the past few years has risen substantially? The brigade transferred to computerised call-out with no problems, and changes to its management structure and working practices have made the brigade a credit to London, its management and other employees. That is in marked contrast to the London ambulance service, which fails every national standard, is grotesquely mismanaged, and is run by a quango—unlike the board, which represents people from London boroughs and has been so successful in improving the London fire brigade.
  Mr. Gummer: I would not have made that comment about the London ambulance service, especially as I—like the hon. Gentleman—depend on it for emergency services. His comments do not characterise the people who work for the ambulance service.
  There are evidently two classes of people in society. There are the people whom the hon. Gentleman thinks will not vote for him, so he is rude about them. There are the people from whom the hon. Gentleman thinks that he might get a vote or two, about whom he is always polite. I do not think it right to attack the London ambulance service in a blanket way, as the hon. Gentleman did.
  The improvement in the London fire brigade is creditable, but only what one would expect of a properly run organisation. It is doing its job properly, and will continue to do so. If it becomes better and more efficient, it will have more resources to spend on things that really matter, which are front-line fire services.
  The TSS figure of £44.93 billion represents an increase of £1.42 billion—3.3 per cent. over the 1995–96 figure. That substantial increase reflects the importance that the Government attach to education and to the care of the vulnerable and elderly. We have provided for a 4.5 per cent. increase in provision for education and 6.9 per cent. for personal social services, including £418 million transitional community care special grant.

  1017
  When we talk about priorities, we are concerned that the money made available is used for the proper purposes. It concerns me that there are already signs that local authorities, instead of spending money on education, are seeking to use the money for other purposes.
  I have a letter from someone who calls himself the "chair" of Hertfordshire county council's education committee. He is Bob Mays, who leads the Labour group for that purpose. Writing to fellow governors, he began his letter, "Dear Comrade". That would have gone down a bit oddly in Hertfordshire, so the complete salutation reads, "Dear Comrade/Colleague". I am interested to know whether "comrade" is old Labour and the "colleague" new Labour, or whether that form of address is to get everybody involved.
  Mr. Dobson: The right hon. Gentleman would prefer "Dear Sir/Madam".
  Mr. Gummer: That would be polite, and at least it would not upset the people who received the letter.
  I object to the rest of the letter, which shows that, far from extra money being spent on education in Hertfordshire, education will have to make savings. Extra money has been made available, but still savings will have to be made. Much of the money will be used for other purposes.
  Local authorities asked to spend more money on education. They said that sufficient money was not made available last time, and that central Government should make sure that it was available this year. We have made additional provision, but Hertfordshire admits that it intends to pinch the money for some other purpose.
  Sir Anthony Grant: Is there not another factor in the equation? Not only does Hertfordshire seem unable to run its affairs properly, but it benefits from the area cost adjustment, unlike Cambridgeshire just over the border. Although Cambridgeshire is not a particularly efficient Lib-Lab coalition, or whatever it is called, at least it has the excuse of not receiving an area cost adjustment. I hope that my right hon. Friend will refer to that difficulty.
  Mr. Gummer: I congratulate my hon. Friend on finding yet another way in which to refer to the area cost adjustment. I shall refer to it later, and my hon. Friend the Minister for Local Government, Housing and Urban Regeneration will take the point further.
  It concerns me that it appears that, all over the country, Labour councils and Liberal-Labour coalitions are taking for granted the figures that their officers give them. They think, "My goodness, we must spend this, that and the other to stay level." They are therefore not accepting that spending is all about priorities. They said that they wanted to spend the money on education, and that they would be responsible in doing so. It will therefore be a real test of whether they say one thing and do another. We shall see.
  Mrs. Anne Campbell: Is the Secretary of State aware of the extreme anxiety in Cambridgeshire over his provisional statement that capping in the county would be set at the level of the standard spending assessment? I think that it is only one of two shire counties that have been penalised in such a way.
  1018
  I should like to quote Mr. Peter Downes, the head teacher of Hinchingbrooke school in the Prime Minister's constituency. The right hon. Gentleman may be aware of the case. Mr. Downes said:
  "We are not very far off melt-down—we are getting to the point where there is extreme anxiety whether we can actually keep children in school for the full time."
  I am worried about that, and I hope that the Secretary of State is also prepared to express his concern.
  Mr. Gummer: The message that the hon. Lady must take back to her area is that Cambridgeshire has the resources to improve its education. If it does not spend them on education, it will be because the Liberal Democrats and the Labour party have misused the money. I understand how difficult it is for her. I would not like to be shackled to the Liberal Democrats. None the less, she is, she chose to be, and she will therefore suffer as a result. Authorities worse run than those run by the Liberal Democrats are difficult to find. I know how hard it is, but all she has to do is give them up. They are not worth associating with.
  Sir Peter Emery: Will my right hon. Friend consider Devon county council, which is a prime illustration of the terrifying behaviour of Liberal Democrat county councils? It is being given £17.5 million extra, yet in its provisional budget it is allocating only £1.5 million to schools. The rest will be gobbled up by the county council. Is that not disgraceful?
  Mr. Gummer: It is not only disgraceful but contrary to what I understand to be Liberal Democrat policy, although I know that that is difficult to define. Although the Liberal Democrats have said that their prime priority is education, they are not planning to use the extra money to fund it. They are planning to use it for a range of other things.
  I do not yet know what Suffolk will do, because, like most other Lib-Lab pacts, it has been very careful not to tell anybody in case the schools notice too quickly. I understand that, although it has an allowance of £11.5 million, which it could spend on education, it is planning to spend only £8.4 million on education. I suppose that the rest will go on yet more road signs, since that is the main interest of my local council.
  Dame Elaine Kellett-Bowman: As my right hon. Friend knows, Lancashire is a very unpopular county council, and it does not devote anything like as much as it should to education. Unfortunately, although it has received much more money to spend on education this year, it is not spending it on education. Worse than that, money within its education budget does not even go to schools; it goes to staff at county hall.
  Mr. Gummer: My hon. Friend makes a fair point, which no doubt she will want to take up with every school in her constituency and in Lancashire as a whole.
  Lancashire appears to have a great deal of money to spend on lawsuits. I wonder whether it should spend some of that money on education, rather than on its continual attempts to use the law courts to implement policies that have not been accepted by the generality of the people.
  Sir Irvine Patnick rose—
  .Mr Michael Clapham rose—
  Mr. Gummer: I give way to my hon. Friend, and then I shall give way to the hon. Gentleman
  Sir Irvine Patnick: Is my right hon. Friend aware that, once again, Sheffield states that it will spend more than its standard spending assessment on education, and claims that its 2.1 per cent. is lower than those of the other three districts in South Yorkshire and much lower than metropolitan councils?
  Mr. Gummer: I am aware of that, but, on a list of councils, one is bound to be lower than others. I try to apply these objective criteria—[Interruption.] The Association of District Councils agrees that they are objective. The methodology is agreed with all three Labour-controlled councils.
  County councils would like to place more emphasis on one part of the methodology than district councils, because they do better out of it. District councils would like another shift, whereas metropolitan councils or the London boroughs would like a different one. That is perfectly reasonable.
  The only people who disagree are Opposition Front Benchers, and I think that only one of them does so. That Opposition spokesman does not understand the system, which is why he finds it so difficult to accept—[Interruption.] I shall just have a word with the hon. Member for North-West Durham (Ms Armstrong), who has not been responsible for this subject for very long. I remind her that the hon. Member for Holborn and St. Pancras (Mr Dobson) is always—[Interruption.] I would like her to listen, because I always thought that she was fair-minded, but she has obviously joined the giggling fraternity.
  Westminster city council did very much better under the system that applied when Labour was in power than it does under the present objective system. Labour's system was devised by the hon. Member for Blackburn (Mr. Straw), who used, with considerably greater power, to perform the job that the hon. Member for Holborn and St. Pancras now does.
  We accept that the system is objective. Sheffield has rather less than others only because the measurement of its need has been lower than that of its neighbours. If only Sheffield was not saddled with the debts that the hon. Member for Sheffield, Attercliffe (Mr. Betts) and his predecessor, the hon. Member for Sheffield, Brightside (Mr. Blunkett), landed it with, it would be able to spend its money on other matters; but despite that, Labour Members tell us how we should run national finances
  Mr. Clapham: The Secretary of State said that the TSS figure of £44.923 is a 3.3 per cent. increase. He will be aware, however, that, when that is deducted from the cost of local government reorganisation, community care and the police, it falls to 2 per cent. As the Government's forecast for inflation is 2.75 per cent. for next year, that works out as a decrease of 0.75 per cent
  Mr. Gummer: The hon. Gentleman knows perfectly well that we certainly expect some savings to be made—the idea that they cannot be made is largely a Liberal one.
  1020
  I visited Liberal-controlled Richmond, which said that it had already made enormous savings and challenged me to see whether I could find further savings. The Liberal leader of Richmond council gave me an exhibition of slides on the wall. The first one was designed to show the enormous savings that it had made. In fact, it showed that, year on year, it had made budget increases—the savings were not there at all. When I asked him what he defined as savings, he said, "Not doing something that we used to do." Then they take the money and spend it somewhere else—and that is counted as a saving. The slides designed to show how the council had cut, cut and cut again, showed instead how it had spent, spent and spent again.
  When I went through the savings that could be made, it turned out that the council had not even considered the possibility of collecting the rubbish from front doors rather than back doors, or of going out to private contract in many areas in which it was not forced to do so. It had not even looked at a whole range of mechanisms whereby expenditure could be reduced.
  The authority really needed to consider those savings, because, as my hon. Friend the Member for Twickenham (Mr. Jesse') has said, it has a real problem, in that it has entered into a very long-term contract for waste disposal, giving it less flexibility there. I only wish that it had found the flexibility elsewhere, instead of saying that it had got everything right and tickety-boo. Even Ealing, unlike Richmond, has discovered some of those savings. That man had been in power in the authority for 13 years, yet he had failed to find even those fundamental and simple mechanisms.
  During our discussions with local authorities, we have agreed to add to the figures that I have mentioned additional funds that they will receive through a special grant to offset the income lost through changes to capital disregards for community care provision. The arrangements for that special grant will be laid before the House in due course
  Mr. Richard Burden rose—
  Mr. Gummer: I must continue for a while.
  As part of the consultation exercise, we asked local authorities for their views on the need to address, through a special grant rather than through SSAs and RSG, the localised pressure on a few authorities' social services budgets arising from the provision of care for unaccompanied asylum-seeking children. The hon. Member for North-West Durham should pay attention; I am sure that she would like to know about unaccompanied asylum-seeking children.
  Such children will need particular help in certain areas, so we accepted the strong representations making a case for a special grant, and the fact that no one wanted the money to be paid through the RSG. My right hon. Friend the Secretary of State for Health will therefore lay before the House in due course a special grant report for that purpose. The grant will be cash-limited to £3 million in 1996–97, and will provide a better distribution to meet the needs of the authorities concerned than would have been possible within the RSG. The resources remain within TSS.
  The total of aggregate external finance—AEF—for England will be £35.65 billion. The revenue support grant element of that total will be £18.02 billion. That is slightly

  1021
  higher than the figure announced in the provisional settlement, as a result of changes to police grant, and the changes in total standard spending and RSG that I mentioned earlier.
  The increase in AEF over 1995–96 is 2.8 per cent.—less than the increase in TSS—because we take the view, which I believe the Opposition share, that council tax payers should properly fund a slightly larger proportion of the costs of their local services. But the level of council tax is a decision for each authority, and will depend upon the level of service that it chooses to provide, the improvements that it can make to efficiency and effectiveness, and how well it collects what it is owed. When the taxes are set, local people will be in a position to judge the performance of their councils.
  Before all that was set up, I received many requests for a relaxation in the capping limits. I was told that, if that happened, great responsibility would be shown, which would prove to us that all such limits are unnecessary. Authority after authority told me that it would be extremely responsible.
  However, I am afraid that, immediately the limits were announced, the leader of the metropolitan authorities went on the radio to say that councils would use the whole lot up—no question. I hope that local councils recognise what that means. If it happens, no Government will have any alternative but to keep that very large amount of Government spending within controls. That is a particularly disappointing attitude, and I hope that it will not be copied throughout the country
  Mr. Burden: Will the Secretary of State give way?
  Ms Joan Walley: Will the Secretary of State give way?
  Mr. Gummer: In a moment.
  We have listened to the case put to us for more resources for education and social services, and we have allowed more. We were told that these were the top priorities, and there was something of an orchestrated campaign to that effect. There is some sign, however, that that will not be the case, and it is unlikely that education and social services will be the priorities that we know they should be in some authorities. The Government and local people must look carefully at whether the money ends up in the schools—and not education generally—because that is where people believe the money ought to go
  Sir Dudley Smith: My right hon. Friend has mentioned a huge amount of money today that is part of the settlement. Does he agree that all local authorities throughout the country should, more or less, try to match their spending with the level of inflation? If they did that, they would be able to regulate their affairs much better. That is a lesson that could be learnt by the Labour and Liberal Democrat councils up and down the country, including the teacher-led Warwickshire county council. They cannot spend more money than is available, but there is more than enough money available
  Mr. Gummer: One can go further, and say that, unless there is an inflationary society, no business can possibly proceed by spending more on overheads and putting up the price of its goods every year.
  1022
  In a society where inflation is under control or is falling, local authorities must do better than match inflation. They must find ways in which they can provide the same services while getting better value for money. If they do not do so, they are not helping people to get jobs, they are not helping the nation to become more wealthy, and they are not helping businesses to expand. Local authorities must do that as part of their economic regeneration contribution. We must press county councils such as Warwickshire to take that step.
  I shall be happy to place in the Library a letter that I received from Hertfordshire, which starts off by stating that inflation does not count with that authority because its rate of inflation is higher than the national rate, so inflation is bound to be higher there. I believe that no local authority should approach the job in that way.
  Several hon. Members rose—
  Mr. Gummer: I shall give way in a moment.
  It is necessary for parents, school governors and those concerned with care in the community to insist that their share of the extra available resources comes to them. It will be necessary, therefore, to make savings elsewhere, and to continue to improve efficiency.
  Here, I must point out to the House that the idea that one ever finishes making oneself more efficient or finding new ways of getting better value is totally foreign to every organisation outside the public service. We all know that councils must find new ways of making the money go further every year if they wish to take on other responsibilities or improve some of the services they provide.
  I should like to refer to the distribution of grant.
  Mr. Geoffrey Clifton-Brown: Will my right hon. Friend give way?
  Mr. Gummer: I should like to move on, and then I shall give way to my hon. Friend.
  We have worked closely with the local authority associations to achieve a distribution methodology that is simple enough to be understood, robust enough to be able to cope with the changes, and complex enough to reflect the real differences in need. Local government knows, and the Government know, that we can never iron out every local wrinkle, but the system is open to scrutiny, and it is clearly objective.
  I know that councillors and hon. Members are concerned about the resources of their local authorities, and I must stress that the Government do not look with favour or disfavour upon any individual authority, as the system makes that absolutely impossible. The previous system allowed one to do that, but now the Government can only alter the distribution by classes of authority, and not by individual ones
  Mr. Burden: Will the Secretary of State give way?
  Mr. Clifton-Brown: Will my right hon. Friend give way?
  Mr. Gummer: I will give way to my hon. Friend, and then later to thehon.Gentleman
  Mr. Clifton-Brown: Does my right hon. Friend recall that he gave the Liberal-dominated Gloucestershire

  1023
  county council one of the highest increases in education SSA—some 5.3 per cent., amounting to more than £9 million? Was not the council's immediate response that it needed £24 million to spend this year? Does my right hon. Friend recall that Gloucester cut the individual school budgets last year by between 4 and 7 per cent.? Will it not be a disgrace if the bulk of that money this year does not go to the individual school budgets?
  Mr. Gummer: It would be a disgrace, but then it is always difficult to know what a Liberal Democrat council will do, because there is no connection between what such councils say in public and what they actually do.
  I am aware that that embarrasses the hon. Member for Newbury (Mr. Rendel), who no doubt will speak later. I note, however, that not many Liberals are present to stand up for their county councils. I think that that is because they know just how bad Liberal Democrat-dominated councils are, and how few of them plan to hand the money on to schools. We shall watch them very carefully, and, if they do not hand the money on, we shall know that their words and their deeds do not coincide.
  Mr. Burden: I listened with interest to the Secretary of State's reports of his discussions with various local authorities, including Birmingham city council. I was particularly interested in the issue of Frankley, and the right hon. Gentleman's statement that the city council had accepted that the deprivation indices used for Hereford and Worcester were appropriate for that area.
  Further investigations have been made in the light of the right hon. Gentleman's answer to my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker). It is clear that Birmingham still objects to the use of those indices for an inner-city area of Birmingham that suffers from extreme deprivation and high unemployment, and has many needs. May I ask the right hon. Gentleman to return to the answer that he gave my hon. Friend, and reconsider the issue of Frankley? If he does not, Birmingham will probably be short by about £1.5 million, the capping limit will be wrong, and the people who will suffer are the people of Frankley.
  Mr. Gummer: The hon. Gentleman is mistaken. Birmingham city council wanted to discuss two issues relating to Frankley. It wanted us to treat primary and secondary school children differently, and, in that connection, presented me with a figure for the large loss that it expected to make. When we examined the position in more detail, however, the council agreed that the action that it had proposed would not result in the savings that it had identified. It acknowledged that, in that instance, the methodology did not have the effect that it had assumed it to have.
  More generally, the council wanted a complete change in the system, to overcome the difficulty encountered when we move from one year to another at a time of boundary changes. One area has to be moved into another, as it were. To do that, we would have to change the method that we have agreed with the local authority
  1024
  associations. We cannot act unilaterally, because that would be wholly contrary to the way we operate. We have told Birmingham city council that, if the local authorityassociations felt that there was a better way of dealing with the matter, we would adopt it if we possibly could; but the local authorities feel that difficulties are involved in moving at such speed.
  This is not a matter on which the Government should act unilaterally. Like previous Governments—I claim no particular credit for it—we have acted after lengthy negotiations with local authorities. The hon. Member for Birmingham, Northfield (Mr. Burden) should address his question to other local authorities, and, if they support the methodology, we can make progress. [Interruption.] The hon. Member for North-West Durham can moan as much as she likes, but that is not only my view; it is shared by many Labour local authorities, as she will gradually come to realize.
  Mr. Clive Betts rose—
  Mr. Toby Jessel rose—
  Mr. Gummer: No, I will not give way. I wish to continue my speech.
  We pay heed to local government in considering possible changes in the various methodologies. Most of this year's proposed changes flowed from suggestions from those in local government. They encouraged us to make distinct provision for rent allowances and for levies of the national parks; they asked us to look again at the way in which we reflect special educational needs and support services, following the ending of recoupment last year; and they asked us to look again at the pensions element in the formula relating to the police.
  We have responded to those representations, and also to the concern expressed in many areas outside the south-east about the area cost adjustment. The review that we set up, chaired by Professor Elliott of the university of Aberdeen, has already begun discussions with local government. Tenders have been invited for research specified by the review team. We have asked the team to report by June.
  Sir Peter Hordern: Reverting to education, what does my right hon. Friend think of the conduct of the Liberal Democrat-controlled West Sussex county council, which wrote to the governors of every school in West Sussex, long before the revenue support grant settlement had been announced, telling them that their spending would have to be cut by £25 million in the next two years? It did so without any evidence. When the settlement was announced, it was found to be far more favourable than it had predicted, but it made no apology, nor has it approached any of the schools to tell them about the improvement that the Government announced in the revenue support grant, which should go straight to the schools.
  Mr. Gummer: The only thing I have to say about West Sussex Liberal-controlled council is that it did not undertake much independent research on the matter, but merely took the whip from Liberal-controlled councils throughout the country. There was nothing special about that. A deal was done that they would frighten parents and governors in advance by writing such a letter without any basis.

  1025
  They did so early enough for a basis not to have been possible. Often, they used examples of how many teachers might have to go, how many books could not be bought and what would be the effect of cuts of 5 per cent. in each school. Stereotype letters were sent to Members of Parliament. They were handed out to Liberal Democrat activists and to some Labour people—happily, some of the latter felt that the letters were a little extreme, even for them.
  I have heard of no example of a Liberal Democrat-controlled council that has since written to the governors to say, "We are sorry there was undue alarm. The figures are as follows, and we are hoping to passport this through to you as rapidly as possible, and that you will be able to use it effectively." I will happily give way to the hon. Member for Newbury, if he can cite a single case in which Liberals have apologised for the letter that was sent out, or for the letters that went out from Labour councils.
  Mr. David Rendel: Perhaps the Secretary of State would like to tell me how many of those authorities are already spending more than the Government now say they should spend.
  Mr. Gummer: The interesting thing is that the hon. Gentleman does not explain that any of those authorities has written to apologise. They all said that there would be large cuts. That will not take place, unless the Liberal authorities do not pass on the money that is now available to them.
  Mr. Jessel: On the subject of spending by Liberal Democrat-controlled councils, when my right hon. Friend visited Richmond on Thames and was shown the slides about which he was kind enough to tell us, did he notice a rather small, new town hall called a civic centre—the building is rather small for a town hall—on which the Liberal-controlled council spent no less than £12 million, as it is of extremely extravagant design? The people of the borough are still paying the hire purchase on that, which is one reason why, in the last council elections in the London boroughs in May 1994, the Liberals lost four seats to the Conservatives in Twickenham.
  Mr. Gummer: I was surprised at some of the things that were included in the slides. Now, I am even more surprised about some that were excluded. Although no doubt the Liberal-controlled council is proud of its new town hall or civic centre, it did not feature. No photograph was included, nor was there any reference to the cost. Indeed, it was not mentioned during the discussion. No doubt my hon. Friend would like to give me further information, so that I can ask for a few more particulars.
  Mr. Betts: The Secretary of State has attacked virtually every Labour or Liberal council in the country. How does he respond to the chairman of a council policy and resources committee who told the Government:
  "we found that government spending restrictions were forcing us into cuts that would damage services to the people"?
  He wanted another £2 million to spend on education. On top of the cuts, it seems that that council will have to increase council tax by up to 9 per cent. to make up the shortfall in Government grants. That was the chair of the
  1026
  policy and resources committee of Buckinghamshire county council, one of the few—endangered—Tory county councils left.
  Mr. Gummer: No council can escape the need to make savings and run itself efficiently. The money that has been provided for Buckinghamshire, as for the rest of the country, is consonant both with its needs and with what the country can afford. There is no other way. [Interruption.] I am even-handed, unlike the hon. Gentleman, in what I say, whatever party is involved.
  Local government has received a significant increase in the money that is available. That money needs to be spent on education rather than elsewhere. The hon. Member for Attercliffe is almost the last person in the House to lecture anybody on running local authorities. His local authority is an example of appalling local government. He was in charge of a local authority that could not teach anybody anything about running authorities except how to run up debts. He must not address the House as if he knows anything about the matter.
  During the consultation period, we have received representations from authorities about our proposals, and have considered them carefully. We have responded to many of the representations about the data that we propose to use in the calculation of SSAs. Some of those representations brought to light the need for amendments, and in those cases, we have been able to make corrections. We shall continue to discuss SSA methodology with the local authority associations.
  I said in November that I would continue to pay a special grant to compensate authorities that have lost more than 2 per cent. of SSA as a result of methodology changes for 1996–97 or for 1994–95 and the incorporation of 1991 census data. That is a fair arrangement that recognises the special problem of a sudden drop in SSA, while also recognising the need to phase out such support, so that grant can be redistributed elsewhere. The Special Grant Report (No. 16) will establish that grant for 1996–97, and some £128 million will be distributed to local authorities in that year.
  I announced a scheme last November to damp unacceptable increases in council taxes directly attributable to local government reorganization—a point that was raised earlier. I do not propose any changes to the scheme, which will apply to areas where the direct council tax effect of reorganisation exceeds £104 in band D. Taxpayers in North Lincolnshire will therefore benefit from a grant of about £2.18 million. I shall lay regulations to implement the scheme before the House in a few days.
  The capping of local authority budgets is the means by which Government ensure that local authorities play their part in controlling public expenditure. I set out in my statement in November the capping criteria that I had in mind to apply for the coming year. I have now considered carefully the representations made by authorities, and I wish to reaffirm that I still intend my original criteria to apply. A table of provisional cap limits based on those criteria will be available in the Vote Office after I sit down.
  Capping is an essential tool for retaining effective control on overall spending. It is an open secret that I would like to be as free as possible with capping, but the reactions of local authorities so far make that stance difficult to maintain. We shall consider carefully how to deal with that.

  1027
  The capping criteria are necessarily provisional.
  Mr. Austin Mitchell: Will the right hon Gentleman give way?
  Mr. Gummer: No, I must finish.
  I cannot take my decisions on capping until authorities have set their budgets for 1996–97. When I come to take those decisions, I shall of course take into account all relevant considerations, to ensure that any cap set for an authority will be reasonable, achievable and appropriate. The House will, of course, have an opportunity to debate any orders that cap individual authority budgets.
  I am also specifying a base budget in the relevant notional amounts report for authorities that are being reorganised or are subject to a boundary change. That will allow me to make a fair comparison between years for capping purposes.
  I now turn to other aspects of local authority finance. Hon. Members will recall that I told the House in November that the Government wished to build on the successes we have already had with challenge funding of local authority spending. In particular, we want to explore whether that approach offers a better and more efficient way of funding authorities' capital expenditure and attracting private capital to supplement public money.
  In my November statement, I promised that we would publish a discussion document on taking forward challenge funding in the near future. I am pleased to tell the House that, yesterday, my Department sent a consultation paper on this subject to English local authorities. This outlines proposals for a capital challenge fund that would provide support for the best capital spending proposals submitted by local authorities. We propose that our ideas be tested—.
  Mr. Betts: That is local authority money.
  Mr. Gummer: It is interesting that the hon. Gentleman says that it is local authority money. It is the taxpayers' and the people's money. The proposals would bring in more private money, so that, for every pound that the local authority spends, at least £1, and probably £2 or £3, more will be brought in.
  The Labour party thinks of only one stakeholder—the local authority stakeholder: it is not the people's money, it is local authorities' money. They say "our money" like they say "our schools". They mean that they are longing to get their fingers on what they think is their money. That money is earned by men and women, who want to make sure that every penny is spent properly. If we can get an extra pound from the private sector, we can provide something much better. [Interruption.] The hon. Member for North-West Durham ought to know that.
  That shows what is different about Labour. It wants to talk in modern terms, but has the same atavistic view of everything that happens. Labour Members say, "It's our money, and we are going to spend it. We don't care about partnership when it comes to getting more money for the things that really matter."
  That is why the outline proposals for the capital challenge fund will enable us to have a better system, which will ensure that the money goes not only where it
  1028
  is needed but where the schemes to meet those needs are the best, and where they can bring in more money from outside, so that what can be done can be better done. We propose that our ideas be tested by a pilot scheme that will be run in the 1997–98 financial year.
  The scheme that we propose would give local authorities a clear lead in deciding on local priorities for capital spending. The best, most imaginative, authorities will be given an incentive to work with local people and businesses to create and implement a local strategy for investment. That would target resources at the areas where they can do most good.
  Consultation on those ideas finishes in mid-March. I anticipate announcing our conclusions and the next steps shortly after that. In the meantime, I look forward to a positive and constructive response to the consultation paper because it will mean more money for the very capital projects that all of us want—those that are best fitted to the needs of the people.
  I have dealt with the main issues that are covered by the four reports before the House. This year's settlement will help local authorities meet the needs of their citizens in education and other key service areas, but authorities will need to continue to get better value for every pound they spend. They will be watched most carefully by the public to see what their priorities are and whether they are spending that money on the things they said the public most wanted. I commend the settlement to the House.
  5.7 pm
  Mr. Frank Dobson: The central message from today's debate is that, in the coming year, council tax payers will end up paying more and getting less. As happened last year, there may be a few parts of the country where the council tax does not rise or where services to local people are not reduced, but in most places the council tax will go up and services will come down; local people will have to pay more, and will get less.
  Last year, our initial estimate was that the council tax would go up by about 6 per cent. The average turned out to be 5.2 per cent. but before the Secretary of State starts crowing in one of his mini-raves, I remind him that the council tax increase in his constituency was exactly as I had predicted, 6 per cent; in the Prime Minister's constituency it was 8.5 per cent; and in the Deputy Prime Minister's it was 7 per cent.
  This year, on the basis of the Government's original statement, we predicted similar increases. It now seems that, even according to the Government, the average increase may be quite a bit higher. When the Chief Secretary to the Treasury gave evidence to the Treasury Select Committee, he let the cat out of the bag. He admitted that the Treasury was working on the assumption that the average council tax rise would be 8 per cent., showing that I was guilty of the serious political offence of failing to exaggerate.
  If the average council tax rise is 8 per cent., that will cost council tax payers some £780 million. That is equivalent to adding about half a penny to the standard income tax rate. If the Chief Secretary is right, therefore, the Government's promised 1p reduction in the standard rate will be immediately halved in value by the council tax increase. That is a perfect example of the Government giving with one hand and taking away with the other.

  1029
  It does not stop there. Budget documents show that the Government expect council tax payers over the next three years to cough up an extra £3.5 billion, equal to almost 2p on the standard rate of income tax. That was recently confirmed by the head of local government finance at the Department of the Environment, who said that the Government were aiming to increase the council tax payers' contribution to council expenditure from 21 per cent. to 26 per cent. He added:
  "That represents a view by Ministers that the council tax can take more of the strain of paying for local services."
  Mr. Eric Pickles: Will the hon. Gentleman give way?
  Mr. Dobson: Let me finish the quotation. The official said:
  "It is not a huge change, but nevertheless it is a trend that present Ministers want to see. The downside is that your taxes go up quite sharply".
  Mr. Pickles: Is the hon. Gentleman familiar with the publication "Renewing Democracy: Rebuilding Communities", which advocates on page 18 that local democracy would be more responsible if a much higher proportion of money to be invested and spent was raised locally? It appears therefore that the Labour party is proposing exactly what he is condemning the Government for.
  Mr. Dobson: As I wrote every word of that document, I am quite familiar with it and it does not mean anything that the hon. Gentleman thinks that it does. The Labour party is saying that, for a start, it would return the business rate—which the Government nationalised, just as they nationalised the water industry—to local control. If he is so concerned about tax rates, he should remember that, if his local authority received from the settlement the same amount of help to provide local services as Westminster city council, rather than paying council tax, people would receive a £489 rebate this year. If Essex county council received the same amount of help per pupil as Westminster council, it would be able to take on 5,350 extra teachers.
  Mr. Gummer: As the hon. Gentleman feels that the Government are not giving enough money to local authorities, will he tell us how much more a Labour Government would have given, and how much more of taxpayers' money it would give to local authorities? We want to know how.
  Mr. Dobson: The Secretary of State took one hour and two minutes to try to tell us his settlement is. We are now going to question it—that is what we are here for today. The settlement that I am talking about is part of that process. [Interruption.] The object of the debate is to consider the Government's proposed settlement and to find out whether it is adequate. As I always say to the Secretary of State, come the general election, we shall make things clear. We shall not make any promises, as the Tories did at the last election, when they said they would reduce tax and then put it up. We shall not make promises to protect people with mortgages and then take that protection away. We shall make sensible, careful
  1030
  promises. When we go into the general election, people will know what we shall do, and when we win, we shall do it.
  The Minister for Local Government, Housing and Urban Regeneration (Mr. David Curry): The hon. Gentleman has said that he will return the business rate to local communities. That must mean that some will win. Those with a large business infrastructure will presumably gain; others will lose. In places such as Liverpool, where will the strain be taken: on the council tax or on increased Government grant? How will he deal with that redistribution problem?
  Mr. Dobson: As the hon. Gentleman knows—so he should not be getting up and asking daft questions—when the business rate was in the hands of local councils, various schemes existed to equalise it between different regions. Those schemes, or fairer variations on them, would obviously be necessary. He, too, is one of the authors of the settlement. If he ensured that the local council that he represents—Craven district council—received from the settlement the same amount of help per head of population as Westminster city council, his council would not need to levy any council tax. It would be able to pay a £528 rebate to everyone. He then asks me about the consequences of our promises.
  Mr. Gummer: I should genuinely like to help the hon. Gentleman. Does he accept that his comments on the settlement would be a great deal more credible if he told us his alternative to our proposal? Does he not understand that, by merely saying that sometime, some place, somewhere, he might tell us, he removes his right to make any comment about the settlement? Therefore, I ask him again: what would he do?
  Mr. Dobson: The Secretary of State has taken the best part—no, the worst part—of an hour and a bit to try and explain his position, and we are going to analyse what he said and what is in the settlement. If he does not like it, he will just have to lump it. After all, he receives a Secretary of State's salary and a chauffeur-driven car for the privilege of listening to us. I might add that he is responsible for the settlement and that, if his local council, Suffolk Coastal, received from the settlement as much help per head of population as Westminster council, his electors would receive a rebate of £591. If Suffolk county council received the same help per pupil as Westminster council from the settlement, it would be able to take on an extra 2,700 teachers without increasing the council tax.
  This year's local government spending level set by the Government does not make full allowance for inflation and for pay increases, such as those needed to attract teachers to inner-city schools. Nor does it allow fully for the cost of educating an estimated 86,000 more schoolchildren; extra contributions that are needed for pensions, police and firefighters; and meeting the costs of new laws on the environment and, rightly, requiring the installation of seat belts on school transport—a measure for which my hon. Friend the Member for Stoke-on-Trent, North (Ms Walley) worked so hard and successfully.
  The spending level does not meet the cost of local councils having to pay to central Government the landfill tax, which will cost them more than £70 million. Nor does

  1031
  it meet adequately the cost of meeting other environmental requirements that have been placed on local councils.
  The level that the Government have set for the coming year is £1 billion lower than the amount councils are spending this year, before taking into account inflation. The Government assume that councils will make up the difference partly by using their balances and their reserves, but many councils have been drawing down heavily on balances for some years. In some cases—for example, Hounslow, Newcastle, Tower Hamlets and the Merseyside police authority—the district auditor has warned that their balances are too low. Councillors there and in many other places will be faced with the dilemma of cutting services or facing the wrath of the auditor and possibly the courts.
  In his Budget, the Chancellor of the Exchequer gave the impression that the Government were increasing their grant for education over and above the amount councils were already spending on schools. That misleading impression has been repeated by other Ministers, including the Prime Minister, and Tory Members have written to school governors and head teachers in an effort to give even wider currency to that myth.
  Local education authorities would like nothing better than to have more money to spend on schools. That is why, between them, they are already spending more on schools this year than the Government target for their spending on schools next year. Local council education spending on schools this year is £872 million higher than the Government's target for their spending. If those authorities were to spend next year the amount that the Government want them to spend, their spending on schools would not increase. They would have to cut it by a figure that works out at a reduction of £40 per pupil—so much for the extra money that is available for education.
  Publicly, the Government speak about increasing spending on schools—while Tory Members of Parliament write letters to school governors—while furtively setting targets that are lower than current spending. That might be described as saying one thing and doing another.
  Local education authorities will do their best to meet the hopes of parents and the expectations that the Government have falsely raised, but it will not be cost-free. Extra spending must come from somewhere. It is likely to result in cuts in other services for children; in price increases for school meals, for meals on wheels and for home helps; and in cuts or price increases for services for elderly and handicapped people, such as those who use day centres or luncheon clubs.
  Education authorities must cope with the needs of an extra 86,000 schoolchildren, with the cost of installing seat belts and with the need to provide more money for children with special educational needs.
  In many parts of the country, another vital service will be placed in difficulty as a result of the settlement—the fire service. That service is under pressure. Cuts have been made in services almost everywhere, but especially in London and the other metropolitan areas, where fire brigades are run by separate authorities. Those are under even greater pressure. Cuts will be made of more than £4 million in the West Midlands brigade, £2 million in the Tyne and Wear brigade and more than £9 million in the London fire brigade.
  1032
  For years, those fire brigades have been cutting staff and postponing the renewal and updating of equipment; now they are expected to do it again. They also have difficulty in funding pensions, which take an increasing share of their budget. The trend cannot continue without weakening the service to the public and endangering firefighters by reducing the number of firefighters available to fight each fire and allowing equipment to deteriorate.
  In London, the process may lead to the closure of four fire stations, the reduction of 22 fire engines at other fire stations and massive cuts in control room staff. The response times of fire brigades throughout the country may be lengthened—surely something that no one could seriously contemplate, but that the Government apparently do.
  Special problems have arisen this year for some of the less urban new unitary authorities that have resulted from the break-up of the counties of Cleveland, Avon and Humberside. Higher-than-average increases in council tax may be needed to maintain anything resembling the present service. That refers to those unitary councils that have already been established, and that take over the running of services this year.
  Equally significantly, the settlement fails to provide money to meet the costs of the change to unitary status by the new unitary districts approved by the Secretary of State or recently recommended for that status by the Local Government Commission. Failure to push through those changes in time for elections to the new authorities in May 1996 will increase the costs and uncertainties of staff and of people living in the area. Such delays will almost certainly lead to council tax increases and to cuts in services in years to come, which might have been avoided by finding the extra money now.
  Mr. Pickles: The hon. Gentleman's colleagues in local government, Labour leaders of councils, have suggested that the settlement is inadequate to the tune of £3 billion. Does the hon. Gentleman endorse that figure?
  Mr. Dobson: I do not endorse anyone's numbers but my own, and the hon. Gentleman is not getting one from me. [HON. MEMBERS: "Oh!"] I explained that earlier. In case the Conservative simpletons did not notice, that was what one of my earlier responses meant.
  Mr. Paddy Tipping: My hon. Friend mentioned the move towards unitary authorities. Have not some orders yet to be laid, and do not shadow authorities that should start in May 1997 need elections in May 1996? Is there not a suspicion that the Government are cherry picking which orders will come through? Why has no commitment been made that the order in respect of Nottingham will be laid before the end of February?
  Mr. Dobson: In fairness to the Secretary of State—it strains my good nature—I should point out that Nottingham was held back because the newly reconstituted Local Government Commission was considering the proposed unitary status of other districts in Nottinghamshire, so it was considered reasonable to hold Nottingham back until that issue had been resolved.
  As the commission has recommended that there should be no further unitary districts in Nottinghamshire, however, Nottinghamshire should go ahead, as should

  1033
  Devon, where both Torbay and Plymouth have long been recommended and no further additions are proposed, along with Leicester and Rutland, to which the Minister has already made a commitment. I hope that he will respond to that, but not necessarily today.
  The way in which the central Government grant is allocated is as important as its overall size. The Government claim that the allocation is the inexorable product of impeccably objective criteria. That claim is plainly false; no one believes it. The allocation of grant is a racket, designed to secure the Government's political objectives. I have no objection to a Government trying to secure their political objectives; I simply wish that they would accept that that is what they are doing.
  One of the basic building bricks of the grant system is the Government's assessment of deprivation, which is not made independently but is carried out by officials at the direction of Ministers. It is a racket that favours a few areas at the expense of most others. Nothing better demonstrates the scale and nature of that racket than the Government's treatment of Westminster city council.
  According to the Government's fantasy finance, Westminster is the fourth most deprived place in Britain, while Barnsley, after a score of pit closures, lurks in 313th place. According to the Government, only three places in England are worse off than Westminster-Hackney, Tower Hamlets and Islington. Everywhere else in England is less deprived than Westminster.
  As the Duke of Wellington said:
  "If you believe that you will believe anything."
  Mr. Gummer: If that is wrong, why did Westminster do better comparatively when the Labour party was in power, when it was seen to be more deprived proportionately than many of the places that the hon. Gentleman mentioned? Why did it do better when the hon. Member for Blackburn (Mr. Straw) did the figures than it does now, when they are calculated objectively?
  Mr. Dobson: If the Secretary of State inquires, he may find that the council tax—or, as it was then, the domestic rates—in Westminster was roughly comparable with those everywhere else. Westminster's council tax payers are now being subsidised by those everywhere else. He knows it; everyone knows it. It was the object of the exercise.
  That was why, when the poll tax was being introduced, Lady Porter said in a memorandum that the man who is now the Secretary of State was more acutely tuned into the political consequences of the original proposal for the share-out, because it would have hammered Westminster and Labour authorities in London would have done better. He knows that it is political and always has been.
  Mr. Curry: I should like to help the hon. Gentleman with his analysis. The last Labour Government, as my right hon. Friend said, was more generous to Westminster, and that was on the basis of a needs analysis. Westminster's need per head was 486 compared with 327 for Liverpool—a difference of 49 per cent. In 1996–97, the SSA paid in Westminster will be £1,265, and that for
  1034
  Liverpool will be £944—a difference of 34 per cent. On the needs analysis, the Labour party gave greater support to Westminster than the present Government do.
  Mr. Dobson: Will the—
  Mr. Gummer: Come on, answer.
  Mr. Dobson: This week, we have had to put up with three amazingly lengthy performances by the Secretary of State and, if he does not mind, I wish to make my speech in my own way and give my answers in my own way. If the Minister of State, who rushes to the aid of the Secretary of State, wants to give the full picture, will he tell us what the rates were in Liverpool, Westminster and the other areas? The sole object of that exercise has been, and is now, keeping down the poll tax and then the council tax in Westminster.
  I admit that there are deprived parts of Westminster, such as the ones where Westminster city council housed homeless families in asbestos-ridden blocks of flats. That is not half the story. The Westminster protection racket does not stop there. Massive benefits flow to Westminster from the way in which the grant system treats visitors. For grant purposes, the Government deem that Westminster's resident population increases by 81 per cent., the residents being augmented by commuters and other day and overnight visitors. So Westminster receives more money to meet the needs of those visitors.
  Those same visitors add not only to Westminster's costs but to Westminster's income, in particular through parking charges. The income from parking charges is in excess of £20 million a year, which is more than about half the district councils in this country have available to spend in a year. That £20 million excess is not offset against the extra grant for visitors. It is added to it. Westminster receives the extra grant and the income from parking charges. That allowance-for-visitors fiddle does not end there—it becomes even more amazing.
  For grant purposes, the Government assume that the visitors to Westminster, like the residents of Westminster, are also the fourth most deprived people in Britain. So, for example, 12 per cent. of the people staying at the Ritz or Savoy hotels tonight will be deemed to be severely overcrowded, thus qualifying Westminster for extra grant. That is the truth of it. All that of course makes no allowance for the £7 million that Westminster received in the past for spending on flood defences, which were never built, or for the £2 million that it received towards the cost of the English National Opera—£2 million that the opera company never received.
  It is no good the Secretary of State trying to deny it. The chief executive of Westminster city council accepts that it is true. In an internal memorandum, he said:
  "We are vulnerable to the criticism that we receive double compensation for these costs; firstly, via the SSA formulae and secondly, via the generation of parking income … Although the use of this is restricted by law, we are able to contribute some £20 million per annum towards our budget requirements (eg off-street parking, highways, street lighting and concessionary fares for the elderly and the disabled). This contribution is equivalent to a Council Tax of £197."
  Ms Walley: Some months ago, 14 people from Staffordshire came down to Westminster as visitors to lobby the Secretary of State for Education and

  1035
  Employment for more money in the standard spending assessment for Staffordshire, so that we could have extra teachers in our classrooms. Those people looked with envy at the buildings in Westminster. They also looked with envy at the extra 4,800 teachers available for pupils in Westminster—at the expense of teachers in Staffordshire.
  Mr. Dobson: The awful thought for my hon. Friend is that, if those visitors came down by road, they almost certainly contributed to increasing Westminster council's funds. One of the great ironies is that, every time people come by road to lobby the Secretary of State, they help to make the racket an even bigger one.
  To be fair, the special help for Tory areas does not begin and end with Westminster city council. Depending on how they are defined, there are only 13 or 14 Tory councils in the country, which makes it easy for the Government to target help on them. It could be described as precision-bombing with money. That is what the settlement has done. According to the Government, Runnymede—I repeat, Runnymede—is the 38th most deprived place in England. It is more deprived than Liverpool, Knowsley or Warrington and more deprived than Easington or Wakefield—which includes Hemsworth—after the pit closures.
  According to non-Government assessments of deprivation and wealth, Runnymede is not the 38th most deprived place in Britain. Quite the opposite, it is the 40th most wealthy place in Britain, if judged in terms of realities such as the proportion of households with three or more cars, the size of the house or the number of households in which average pay is above the higher tax-rate threshold. I do not say that those criteria are perfect, but they are much nearer to reality than the Government criteria, which are the reverse of reality, that are applied to some areas.
  According to the realistic criteria, another Tory area—Surrey Heath—is the best-off place in Britain. If one knew the area—it is near Camberley, Chobham, Bisley, Windlesham—one would have to conclude, from the visible evidence, that Surrey Heath was pretty well-off. However, it is not well-off according to the criteria that the Government used in calculating their grant to local councils. According to those criteria, Surrey Heath is more deprived than 83 other councils in this country, including Barnsley, Allerdale, Bolsover, Ellesmere Port and Warrington.
  If we shift a little to the north, Huntingdonshire, which is represented by the Prime Minister, according to the realistic criteria that I have spelt out, is the 43rd most wealthy place in England. However, according to the Government, it somehow qualifies for a higher deprivation rating than all the councils that I have just mentioned, apart from Barnsley. The Prime Minister's Government recognises that Barnsley is just marginally more deprived than Huntingdonshire. I do not know what that says about what the Government have done to Huntingdonshire during the past few years.
  It is almost impossible to spell out the scale of the financial gerrymandering that the Government have used to bail out their friends on Westminster council. Some time ago, when we made these points, Ministers suggested
  1036
  that there was some independent back-up research, from Bristol university, for placing Westminster fourth in the deprivation scale. The Minister of State nods. Mr. Deputy Speaker, if you look at the table produced by Bristol university, it contains even more bizarre rankings than that which places Westminster fourth. According to the table that the Government want us to accept, the Scilly Isles are ranked third. I do not think that the Scilly Isles are more deprived than Barnsley, and Mr. Deputy Speaker, I do not suppose you do either.
  On the next page of the tables that have been worked out by the people at Bristol university, it shows that Westminster is ranked 96th. It is clearly just a racket. It is the grants-for-votes scandal. The scale of the scandal is difficult to exaggerate, so I shall not even try. I shall rely on the Government's own figures, which show that if every council in the country received the same grant per head as does Westminster city council, 94 per cent. of councils would not have to collect any council tax at all. Instead, most of them would be able to pay out rebates. Seventy per cent. of them would be able to pay out rebates of more than £500, and nine councils—including Southampton, Portsmouth, Redditch, Stoke-on-Trent, Tamworth and Wellingborough—would be able to pay out rebates of more than £900.
  Let us examine the education SSA for this year. If Kent received the same help per pupil as does Westminster, it could have taken on an extra 4,600 teachers; Staffordshire could have taken on 3,250 extra teachers; Essex could have taken on 5,650 extra teachers; Nottinghamshire could have taken on 2,500 extra teachers; Warwickshire could have taken on 1,400 extra teachers; and Shropshire could have taken on an extra 890 teachers. Wakefield, which includes Hemsworth, could have taken on an extra 1,470 teachers. However, those councils could not do that. Instead, they were forced to make cuts and increase class sizes. That is what happens in other parts of the country. Even that—
  Mr. Pickles: Will the hon. Gentleman give way?
  Mr. Dobson: No, I will not.
  Even that is not the end of the story. Westminster council clearly needs central Government help to make up for the funds which it has lost through fraud and mismanagement. The district auditor is about to issue his final report on the homes-for-votes scandal, which he said has cost £29 million. To get that huge sum—£29 million—into perspective, hon. Members should understand that, of the 365 district councils in this country, 261 have total budgets of less than £29 million. Therefore, 261 councils in England have less to spend on their citizens in a year than Westminster has unlawfully squandered in just one of the many financial scandals for which it has been caught out.
  It is not only the scandals that consume public money in Westminster, but the grotesque expense of the services that the council provides. According to the Audit Commission's figures—I always use official figures—Westminster spends £53 per head on refuse collection and disposal compared with Camden, which spends £24 and St. Helen's, which spends £18 per head. Street cleaning in Westminster costs £37 per head. In Camden, it costs £14 per head and in St. Helen's, it costs just £2.28.
  Westminster's administration of housing benefits costs £226 per claimant—that is the highest figure in the country, like so many others that I have cited—and only

  1037
  62 per cent. of applicants receive their money within two weeks. In the neighbouring borough of Camden, which has similar problems and a fairly similar population, the equivalent figure is £103 and 95 per cent. of applicants receive their money within two weeks. That is why the Government gave Camden's benefits section a charter mark.
  However, the Tory Government never say a wrong word about Tory Westminster council. We can only conclude that it is because they approve of every single thing that the council does. The Government's problem is that they do not have to answer only to the voters of Westminster—although, with the boundary changes, they will lose one Member of Parliament to Labour in Westminster at the next general election. They also have to answer to the people in the rest of the country.
  The people know that the Government are furtively pushing up council tax and cutting local services, while at the same time publicly and repeatedly drawing attention to the 1p reduction in income tax. In other words, the Government give with one hand and take away with the other. As a result, local people all over the country will be forced to pay more and get less. That is why the orders are wrong and that is why we shall vote against them tonight.
  5.41 pm
  Mr. Michael Alison: As a Member of Parliament who represents a northern seat, I found it bizarre to hear the hon. Member for Holborn and St. Pancras (Mr. Dobson) focus so obsessively on Westminster. It is quite impossible to follow the debate, which has serious implications for the whole country, when the hon. Gentleman dwells obsessively on Westminster.
  I cannot understand why the hon. Gentleman is so obsessed with Westminster. Is it simply because his constituency is situated near Westminster? Are there rival football teams? Is lacrosse at the root of his obsession? What is the explanation of his extraordinary obsession with Westminster? Why did the hon. Gentleman not mention a word about Holborn and St. Pancras so that we could, perhaps, get to the root of his obsession with the city of Westminster?
  The hon. Gentleman compared the cost of street cleaning in Westminster with the same service in St. Helens but, in so doing, he was comparing the sun with the moon. What conceivable parallel could be drawn between the cost of street cleaning and sweeping in St. Helens and in Westminster? A vast number of people from every part of the country often gather to protest in the City of London and in Westminster.
  Mr. Betts: To protest about the Government.
  Mr. Alison: It is true that they sometimes protest about the Government, but that is an occupational hazard that we readily accept—it is part and parcel of being in government. People come to protest for many other reasons. For example, Turkish citizens may protest about events in Bosnia. I hope that the hon. Member for Sheffield, Attercliffe (Mr. Betts) welcomes the fact that many people, including overseas visitors, come to protest outside the Home Office—quite irrelevantly—about the persecution of Turkish minorities in Bosnia.
  1038
  Has the hon. Gentleman seen the muck and the rubbish that accumulates in all sorts of central London locations—near embassies and so on—when a large number of people gather to protest and object? That is why there is a little disparity between the cost of street cleaning in St. Helens and in Westminster.
  Mr. Betts: Are the right hon. Gentleman's constituents happy to subsidise Westminster in the way my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) so clearly described? Does the right hon. Gentleman think that it is fair that there should be a double subsidy—as the chief executive of Westminster city council pointed out—in terms of the standard spending assessment on day and night visitors and car parking income? Should not one subsidy be offset against the other? What would the right hon. Gentleman's constituents think about that?
  Mr. Alison: I must be careful how I respond to that intervention as I hope to bend the ear of my hon. Friend the Minister for Local Government, Housing and Urban Regeneration about certain improved transfers to the Selby district. I hope to gain his sympathy in that regard.
  As to the hon. Gentleman's question, I simply refer him to the intervention that my hon. Friend the Minister made during the speech of the hon. Member for Holborn and St. Pancras. My hon. Friend pointed out that the situation was worse when Labour was in power: Westminster received more subsidy and more help. The idea that the present arrangement is a Government racket geared to improve the lot of Westminster voters does not stand up to analysis, as my hon. Friend said earlier. I should like reassurances from both parties as to what will happen if there is a little money to spare, as I am particularly concerned that the Selby district should benefit.
  The hon. Member for Holborn and St. Pancras referred also to the old, pernicious and damaging system of the business rate. I am very proud and happy to represent the Selby district. The area has a gigantic industrial base, which includes the Drax and Eggborough power stations as well as the whole of the Selby coalfield. If we were to return to the old business rate system, we would have a bonanza, but how much would we then lose in rate support grants? How would the balance be adjusted?
  What would happen to the wretched neighbouring areas which have no industry? Some of them—particularly Merseyside—have no industry precisely because the business rate system drove it out. Is the hon. Gentleman suggesting that a return to the old business rate system is a great leap forward to modernity? If that is Labour's policy come the general election, we shall be happy to debate it.
  Mr. George Stevenson: Is the right hon. Gentleman aware that, if my local authority in Stoke-on-Trent had increased expenditure by anything like the percentage by which the Government have jacked up the business rate, it would have been capped three times over?
  Mr. Alison: I should have received notice of that question. I shall ponder it in my bath when I am in a reflective mood, having carefully read the hon. Gentleman's intervention in Hansard.
  Mr. Gummer: I am sure that my right hon. Friend will recall that the business rate may not be raised by more

  1039
  than the percentage increase in the cost of living. He will probably also recall that, when the business rate was in the hands of local authorities such as Sheffield, it was used as a mechanism for taking huge amounts of money from business with the result that almost all businesses in Sheffield would have moved out if they could have sold their premises.
  Mr. Alison: I entirely accept my right lion. Friend's reminder. It is bizarre that the hon. Member for Holborn and St. Pancras poured such acidic wit and criticism on the attempts that local government associations have made, in co-operation with the Government, to produce some sort of objectivity in the analysis of need.
  The hon. Gentleman showed, mockingly, using various lists, how implausible that seemed to be, but he is offering to go back to the weird system of raising the business rate in an entirely irrational and undifferentiated manner, which depends entirely on the location of historic industrial premises and those that have been swept to new locations as a result of the Labour party's battening on to the fatted calf in certain areas. He gave us a wholly inconsistent critique. He criticised my right hon. Friend's attempt to be objective, but then proposed a return to the old system of business rates.
  While I have the attention for a brief second of my right hon. Friend and of my hon. Friend the Minister for Local Government, Housing and Urban Regeneration—and I cannot hold it much longer—I wish to refresh their memories of the peculiarly Procrustean torture that befalls local authorities that have large chunks of their old district removed as a result of structural or boundary changes.
  My hon. Friend the Minister was kind enough, at the end of October 1995, to allow me to bring Selby's chief executive, Mr. Chris Edwards, and chief finance officer, Mr. Martin Connor, to meet him to explain the problems that have arisen because the district has suffered a loss of resident population of nearly one third. That is a big chunk—from 92,000 to 72,000. Selby has lost some 20,000 of its resident population through the boundary changes associated with establishing the new neighbouring York unitary authority.
  We told my hon. Friend the Minister, and he was kind enough to listen with great patience and perception, thatalas—local government services and their costs cannot be cut precisely to match the transfer of outgoing population. Procrustes had a bed which unwary wayfarers were made to fit. If they were a bit shorter than the bed, they were stretched in an agonising rack; if they were a bit bigger they had bits chopped off.
  My hon. Friend the Minister has unwittingly imposed the perversion of that fearful torture on the Selby district—a combination of chopping and stretching. The chopping happens because lots of local government officers have to be chopped off after a big loss of population—which amounts almost to one third. In the case of Selby, that will produce a redundancy bill of £1 million which, considering our grant from central Government is only £4 million, is a large proportion of extra costs. The stretching happens with the services that are left behind—they have to be stretched over a large, but thinner, district. We will have fewer local government officers, which produces redundancy obligations, and
  1040
  probably a poorer standard of service. We cannot cut precisely to match the loss of council tax paying population.
  When we met my hon. Friend the Minister on 26 October 1995, the provisional SSA figures were just about to be published. On 30 November 1995, only a few weeks later, my hon. Friend published his provisional SSA figures. I found that Selby's provisional SSA figure was £6.513 million and I thought that, as a result of meeting my hon. Friend at the end of October, we would see some evidence of recognition of our Procrustean dilemma when the definitive figures appeared.
  I was appalled to discover that the SSA has fallen from the provisional sum which was published just after I met my hon. Friend. I can only conclude that we in some way offended or outraged him. That is why I am doing my very best today to offend and outrage the hon. Member for Holborn and St. Pancras—so that I may win the enthusiasm, support and friendship of my right hon. and hon. Friends on the Front Bench.
  It is certainly true that the so-called relevant notional amount in the case of Selby has been raised to £7.19 million, but that simply means that our capping limit has been adjusted upwards to take account of the problems with local government structural and boundary changes. The sum still has to be funded and financed by the local council tax payer. That will mean, for example, that the estimated council tax for band D, which is now £92.67, is likely to go up—if we go to the full new capping limit of £7.19 million—to £105. That is an increase of 13 per cent. or more.
  I just caught the wisp of an indication from the conclusion of the speech of my right hon. Friend the Secretary of State that there might be some help for Selby—and north Lincolnshire—in the new limit that he has established to give special help to local authorities with severe boundary and population movement changes. I shall consider carefully what he has to say. I hope that my right hon. and hon. Friends realise that if we have to spend up to the new capping limit to accommodate £1 million of redundancy money, we will have to do exactly what the hon. Member for Holborn and St. Pancras accused the Government of doing overall. I dispute and repudiate his accusation, but in Selby, because of a unique and non-recurring phenomenon, we will have to charge people more for reduced local government services. People will get a poorer service, but they will have to pay more for it.
  Mr. Curry: I hope that I may assist my right hon. Friend. He mentioned the redundancy and transitional costs that will be especially important for Selby, given the size of the area which is being removed. As he will know, for 1996–97, Selby made an extremely low bid—of £100,000—compared with many other authorities. We met that in full. The 1996–97 bid did not include provision for redundancy and compensation payments, but we expect that that will be included in the mid-year bidding round and further allocations could be made at that stage. I shall bear in mind my right hon. Friend's remarks at that time.
  Mr. Alison: My hon. Friend is very kind not to force me to wait in agony and expectation until he speaks later for that little expression of hope and encouragement. It is

  1041
  very much appreciated. I hope that my hon. Friend will continue to focus on the needs of Selby. There will be a problem if the extra demands have to be paid for purely by local council tax payers and not through the agency of some sort of redistributive mechanism.
  Mr. Dobson: In the same spirit, and to save my hon. Friend the Member for North-West Durham (Ms Armstrong) making the point later, may I say that the right hon. Gentleman has made a good case? Selby is in unique circumstances and the help that the Minister mentioned would not breach any principles, or set any precedents for anywhere else. The Opposition would be happy to support any efforts that the Government, the council and the right hon. Gentleman can make to sort out the problem, because Selby has been battered twice rather than just once by the changes.
  Mr. Alison: I am much obliged to the hon. Gentleman for that helpful contribution. I know that he has some geographical and personal knowledge of the Selby district. I hope that I can end my speech on a note of constructive harmony in the expectation that my right hon. and hon. Friends on the Front Bench will listen carefully to me and to the Opposition spokesman and ensure that everything possible is done. I can see other colleagues nodding in every part of the House. Perhaps we can have a general agreement that something special should be done for Selby and that my right hon. and hon. Friends will do their best to secure it.
  6 pm
  Mr. Peter Hardy: I am delighted to follow the right hon. Member for Selby (Mr. Alison), who is a fellow Yorkshireman. I hope that the support of my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) will prove helpful. When the right hon. Gentleman retires at the next election, we shall be looking for his successor to come from the side of the House that we will occupy—although I, too, shall have retired.
  This is not the first time that I have participated in a debate on local government finance. I have not done so for the past two years, but I did so frequently before that. Today, I found the Secretary of State to be courteous, although he was rather cutting about the Liberal Democrats. He took a great deal of time and gave way frequently, but it was not until my hon. Friend the Member for Barnsley, West and Penistone (Mr. Clapham) intervened that he clearly and specifically accepted that local government spending this year is so inadequately supported by central funding that council tax will go up substantially.
  Many experts believe that, on average, council tax increases throughout the country will exceed the rate of inflation by a factor of two and, if certain eventualities such as higher settlements, greater costs and more urgent crises assail local government, the burden will be even higher. Some key services will be threatened, as will some of the non-statutory activities normally undertaken by local government.
  For example, the Government are supposed to be keen on combatting crime. In the past few months, they seem to have detected a slowing in the rate of increase in crime. In fact, it has much more than doubled since 1979. Many of the villains are not in prison because the rate of
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  convictions has fallen in actual terms. Many local authorities, mine in particular, are keen to see measures to discourage crime, but there will not be any capacity to do that adequately.
  I do not believe that the lot of police authorities is particularly pleasant today. The fire services, which have been put under great pressure, have been mentioned. The Minister might like to recall that the number of calls to which fire services had to respond during the drought months created serious problems for those authorities.
  I am concerned about education. I welcomed the Chancellor's reference to education in the Budget—he announced that almost £800 million extra for education would be directed to local authorities—but many local authorities are already spending above the level on which the Chancellor's calculations were based. A further 83,000 children will enter our schools and they will have to be catered for from an increase that may well be more fictitious than real.
  There is another problem. The Minister will be aware of it because he has visited my constituency on a number of occasions in the past year or two. We have enormously high unemployment. A vast proportion of our young people see no opportunity for employment and a great deal of effort is put into seeking to ensure that they stay on at school or enter further education—anything other than hanging about the streets. The number of young people who have stayed on beyond the normal school leaving age recently has presented serious problems for an education authority that seeks to be sensible and realistic. The Government might say that other authorities have been treated more severely, but I do not believe that we have been given the assistance or the resources necessary to save money.
  The same argument applies in respect of old people. People are living longer, but going into care costs a great deal of money. It is sensible to give local authorities the capacity to sustain elderly people in their own homes because the alternative is more expensive. The number of people who reach 90 or even a century has increased appreciably in my area.
  Not long ago, I wrote to a couple who I thought had been married the longest in my area—they were celebrating their 65th wedding anniversary. I wrote to them because I know their son-in-law. I congratulated them and reminded the old man that I had seen him by a reservoir not long before. His daughter telephoned me to say that I have in my constituency a couple who have been married for six years longer—that fact did not get into our observant local newspaper.
  People are living longer and they need the sustenance and care that can be provided by a local authority. They will not get it if local authorities remain docile and seek to keep council tax down to avoid offending their tax payers and the Government.
  This will be a difficult year for local authorities. It has become increasingly difficult for local authorities to bear their burdens while the flagship of the Conservative party has been supported for the past eight years. Seven years ago, I gave the House a detailed comparison between my authority and Westminster. I reviewed the comparison the following year. If my authority had been treated in the same way as Westminster during the past seven years, none of my constituents would have had to pay any council tax, we would have been able to provide twice as

  1043
  many old people with free meals and several hundred more home helps every year and every person in the Rotherham metropolitan borough—man, woman and child—could have pocketed more than £1,250.
  The argument advanced in support of the enormous assistance given to Westminster is that it is part of the capital city and has to sustain the responsibility of the centre in promoting national culture, art, music and so on. In fact, the vast majority of provincial local authorities spend a larger proportion of their budget on those purposes than does Westminster. I challenge the Minister to deny that. The average local authority provides a higher level of support for art, culture and music than does Westminster city council. The situation is so bad that the national lottery has to use my constituents' contributions to fund the extravagant schemes and to provide those central responsibilities that the Government assume Westminster bears.
  If the authority was efficient, I would not mind so much. During a debate in the House a few years ago, I mentioned an old-age pensioner in my constituency who had not set foot in London since 1955. He received 14 parking tickets and a summons in Westminster for parking a car that had never been there. [Laughter.] Oh yes. It just so happened that the car with false number plates was discovered on the morning of my debate. The person involved was never prosecuted. The car was a large blue Rover. I do not have a blue car for obvious reasons and I suspect that the person involved may have been closer to the political sympathies of Conservative Members.
  If my local authority had done anything like that, there would have been demonstrations such as those mentioned by the right hon. Member for Selby. There would have been protests about the incompetence of the council. Yet the Tory flagship must continue to sail. I hope that, after the next general election, we will see rather more intelligence and a greater sense of justice pervading decision making in the Department of the Environment.
  Seven years ago, I argued that there was grossly inadequate weighting for the unemployment factor in the determination of central support. The Government decided that it was a good case and there has been some improvement since then. However, I still consider that there is grossly inadequate consideration of the factors of poverty and low pay.
  If a community suffers from low earnings and the average household income is therefore extremely low, that has a serious effect. I take the view—and have done so for a long time—that that factor is not given sufficient weight. Any improvements that the Government may have made have been grossly inadequate. There is a strong case for an independent assessment of and arbitration on such factors in the determination of central grants. It is a serious argument. My authority and others in South Yorkshire, which contribute to the Deane valley city grant scheme—over which the Minister has a watching brief—are areas of real poverty. Jobs have been destroyed and the wages of those in work have fallen in real terms. It is a grossly inadequate that that economic reality is not taken into account in the determination of grant. That must be dealt with immediately.
  In 1979, Graham Page, the former Minister with responsibility for local government finance, described his task as flying around England in a helicopter dropping
  1044
  bags of money on town halls. That may have been an inefficient system, but it did not matter so much then because, in those days, the rates provided a much smaller share of local government income than does council tax now. [Interruption.] It is true.
  Once Lady Thatcher decided that the burden had to be shifted from the taxpayer to the ratepayer, people became a great deal more sensitive to the problems. The Government then became a great deal more critical of local authorities that did not do exactly what they wanted. Local government must serve local needs. It should not depend on a Government who exercise excessive pressure through such measures as capping. Sometimes, local government knows best. Indeed, local government is often more careful in its stewardship of public money than the Government Departments that so often criticise it.
  6.12 pm
  Mr. Eric Pickles: It is a great pleasure to follow my right hon. Friend the Member for Selby (Mr. Alison). He gave us a lesson in how to charm the Government. As many of us have thought for some time, he is an old smoothie.
  It is also a great pleasure to follow the hon. Member for Wentworth (Mr. Hardy). I read his speeches in Hansard before I came to the House. I wish him well in his future retirement. I am sure that it was a slip of the tongue, but the hon. Gentleman said that under Lady Thatcher the proportion of grant raised locally was increased. In fact, it was decreased. Perhaps he was confused by the fact that the gearing was changed.
  It is wrong of Labour Members to say that the standard spending assessment figures have been fiddled. No one seriously believes that. They have been examined by the Audit Commission and by such luminaries as Tony Travers from the London School of Economics. All the reports say that the way the methodology works is satisfactory and fair. No one can point to another system in the world that is more fair.
  Mr. Barry Field: My hon. Friend's long list did not include the Environment Select Committee, which also found the system to be entirely objective.
  Mr. Pickles: I am grateful to my hon. Friend for that additional information.
  Labour Members have drawn comparisons between Wandsworth and Westminster. If Wandsworth received the same grant as Tower Hamlets, it could give back £1,000 to each council tax payer. Unless my geography is terribly wrong, Tower Hamlets is not exactly a safe Conservative borough. It is certainly not part of some supposed Tory plot. Sooner or later, Labour Members will have to produce reasoned arguments.
  The reason why Labour Members say that the SSA figures are fiddled is that they do not want to answer two basic questions. First, if the grant is inadequate, how much extra would Labour be prepared to provide? Secondly, what proportion would be raised locally?
  Mr. Betts: The hon. Gentleman said that the Audit Commission had accepted the methodology. Is he aware that the Audit Commission commissioned a report by Price Waterhouse on the issue of capital financing, which

  1045
  my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) mentioned? It rejected the idea of notional debt as part of the capital financing arrangements within the SSA and suggested a system, albeit an adjusted one, based on credit approvals. Why do not the Government take up that suggestion, which would help authorities such as Birmingham and Sheffield?
  Mr. Pickles: The hon. Gentleman knows that in April the way in which local authorities can deal with capital financing will change because of the private finance initiative. That will give them many opportunities, in partnership with private enterprise, to renovate schools, libraries and leisure centres.
  There is a certain carnival atmosphere about the debate. The Evening Standard last night said that it was like a ritualised dance. The Opposition come and say that the grant is inadequate and that the world as we know it will come to an end. The Government come and say that the grant is generous and reasonable. The Opposition say that there will be many redundancies among teachers and council staff and that it will be the end of services as we know them.
  This year, the Opposition say, "We are not crying wolf. There will be deep cuts in local government services." Of course, that never happens—and why not? Let us take one standard assessment. The largest part of any local authority budget is staffing. Local authorities have to deliver education and social services, which tend to be reliant on high numbers of staff. Compared with last year, there has been a reduction of 1.5 per cent. in the staffing level. However, if we deduct from that all those employees who have transferred to private companies through compulsory competitive tendering or who now come under the arrangements for grant-maintained schools, the figure shrinks considerably.
  Hon. Members may say that that is just one year, but comparisons with 10 years ago show that about the same number of people are employed in local authorities now as they were then—despite compulsory competitive tendering and the various new functions that have been introduced. It is simply not true to say that vicious cuts are being imposed.
  At the time of our debate last year, one authority screamed loudly about the number of teachers and other staff that it said it would have to make redundant. I am referring to the late, but not very lamented, Avon county council. When it was finally wound up and its reserves were examined, there was an unexpected balance of £54 million. That is enough to absorb the total budgets of five or six district councils. The spokesman for the council said that the balance was larger than had been anticipated. That is a bit like the late Emperor Hirohito saying that the second world war had not gone entirely to his satisfaction.
  Mention was made of Westminster city council and other Tory authorities. The hon. Member for Holborn and St. Pancras (Mr. Dobson) is no longer in his place—he is a busy man and no doubt has other things to do. It was a bit rich of the hon. Gentleman to lecture Tory authorities when Camden council ended the 1994–95 financial year with £180 million of uncollected debts. For many years, the majority of that council's staff enjoyed terms and conditions of employment that were described by their chief executive as reflecting unique generosity to the point
  1046
  of illegality. That council spent £1.5 million on computer equipment, then failed to use it. That council lost £300,000 worth of computer equipment for four years. That council was described as having no coherent children in care policy. It was more than a bit rich of the hon. Member for Holborn and St. Pancras to shroud-wave about education cuts, saying that children would miss out, when his own council in Camden took more than £4 million from its education budget in 1994–95 to cover bad debt and interest rate swaps, which had nothing to do with education.
  The hon. Member for Holborn and St. Pancras questioned the mix, and expressed concerned that the amount of money that would have to be raised locally will increase. As I pointed out, a Labour document suggests that that will happen. The hon. Gentleman said that he wrote every word of it. On page 18 of "Renewing Democracy, Rebuilding Communities" the hon. Gentleman stated:
  "We believe that it would be better for local people to make a healthier democracy if councils were responsible for raising locally a much higher proportion of the money they invest and spend."
  The hon. Gentleman said that he did not mean that exactly but that the business rate should be repatriated. That would increase the amount of money raised locally. If that is what Labour Members mean, why not say so? Why use obscure wording when it would be simpler to say, "We will ensure the return of the uniform business rate." Then everyone would understand. This is a clear example of Labour running from a policy that it now perceives to be unpopular.
  Ms Hilary Armstrong: I am sure that the hon. Gentleman has read the whole document—in fact, his copy is annotated. He will be familiar with its statement that the first thing that Labour wants to do in terms of denationalising Tory policies is to restore the uniform business rate, but Labour is consulting businesses and other interested parties on how to achieve that effectively. We want to make sure that those other interests are involved. That is why we are not prepared at this stage to fling numbers about. If Mrs. Thatcher had behaved that way, the Conservative party would not have wasted £4 billion.
  Mr. Pickles: I have read the full document, and very enjoyable it is too. I did not miss out any sentences. I did not fiddle the words to mean something different. It is clear that the document is referring to the uniform business rate, but it says something extra. It says that the proportion should be increased. When Labour consults, it will no doubt be told by business men, "We remember a time when people took roofs off factories, to avoid paying exorbitant business rate." The hon. Member for Sheffield, Attercliffe (Mr. Betts) will no doubt remember, because that occurred in his own metropolitan district council. The hon. Lady is not on a winner. If this is the only denationalisation—[Laughter]. I mean, renationalisation. Those words are so old that we tend to forget them. It is like a journey into the past. If this is the only renationalisation that the Opposition propose, it is not even old Labour.
  Mr. Robert G. Hughes: Does my hon. Friend recall that Labour members of Labour-controlled authorities were on to what they believed was an electoral

  1047
  winner—and it probably was, for them? The bills were paid by the milch cows of business, which had no votes, while the rates of people who had votes were disguised as part of their rent. Labour was able to destroy businesses and jobs. The figures are on record. Businesses voted with their feet and moved out of Labour boroughs. The hon. Member for North-West Durham (Ms Armstrong) plainly wants that situation to return.
  Mr. Pickles: My hon. Friend said that the voters did not appear to pay, but rightly pointed out that they did. They lost jobs, investments and opportunities. That was the price paid by people when they decided for narrow, sectional interests to impose ideological policies on local councils.
  Mr. Betts: I will give the hon. Gentleman two examples of raising money locally. Sheffield city council raises extra income from local sources by opening the town hall car park on Saturday. Secondly, all the internal roads for Meadowhall shopping centre were designed by the council's own engineers and received commendations from Meadowhall's owner, Eddie Healey, for doing a job as good as any private firm. Local authorities are restricted by the vires rules that the Government inflicted on local councils, which prevent them from earning money in the ways that I described.
  Mr. Pickles: No doubt the hon. Gentleman went round that centre with his personal plumb bob and spirit level, to examine the roads. I do not understand his point. Nobody is suggesting that all the work done by local authorities is bad. We are arguing that heaping debts on the back of local business is not the best way to be involved in the local economy. If the hon. Gentleman wants to involve and to work in partnership with the private sector, and to relieve himself of an obsession with municipal ownership, the people of Sheffield will welcome that approach.
  This year, local authorities will r0eceive £900 million, which is greater than expected from last year's statement. Arrant nonsense was talked about local authorities suffering different rates of inflation from the rest of the country. That is a hoary old chestnut. That was true in the late 1970s, but it has not been true for the best part of 20 years. Against the background of additional money, it is only right for the Government to focus on the priorities of education, social services, and law and order.
  I share my right hon. Friend's concerns about relaxation of the capping rules. Removing capping is like getting off the back of a tiger. One is safe until one tries to dismount, and then the problems start. With local authorities, the tiger has been smiling through its beard and saying, "It is going to be all right. You can trust us, we are responsible and we will do the right thing." Yet the very moment capping is relaxed, we hear statements like the one made by Sir Jeremy Beecham.
  Like many hon. Members, I received a briefing note from the three local authority associations—which are soon to be one—in which Sir Jeremy Beecham said that
  "the settlement did not match what councils were spending."
  What a daft idea that it should. Indeed, there would something wrong with the settlement if it did match spending. In no other sector would the wish list of an
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  organisation suddenly become its spending plans. The idea that the best way in which to solve a problem is to appoint an officer is entirely wrong. In my experience, the best way in which to solve a problem is to disappoint an officer.
  Local authorities use a strange language of compliance. We hear councillors say that as the capping level has been relaxed they will spend up to the new level—just because the Government say that they can. When the Government say that it is possible to raise the level of spending, they are by no means advocating that such a level should be reached. Just because the standard spending assessment has gone up or just because the cap has been relaxed, there is no compulsion to increase total spending.
  The hon. Member for Holborn and St. Pancras seemed rather excited about what the Chief Secretary to the Treasury said about expected levels of council tax. I should think that the Chief Secretary, by his nature, has a rather jaundiced expectation of human nature. There is no reason for council taxes to increase by about 8 per cent. Indeed, some councils are planning to cut their council tax next year. We should expect, however, local authorities to start to address priority.
  Clearly, we are giving education a high priority this year. In my county of Essex, the total sums available for education are being increased by almost 5 per cent—an increase the size of the allocation for two or three district councils. We have already heard that the Lib-Lab coalition on the council is determined not to pass on those extra resources to schools. All we will see as a result is a further flood of schools opting for grant-maintained status. Every secondary school in my constituency is already grant-maintained. They offer enhanced choice and diversity in education, whether in language or technology.
  I would, however, like to take a leaf out of the book of my right hon. Friend the Member for Selby and make a special plea to my hon. Friend the Minister, because we have worries in the Brentwood area. [HON. MEMBERS: "Ah."] They are real worries and I hope that the Opposition will support me in my plea. Our schools are so good and so attractive that we are desperately worried about the prospect of an influx of children of members of the shadow Cabinet. We are not entirely sure that we can take such a number of children, but we will do our best. Should Brentwood schools be favoured by Opposition spokesmen, will my hon. Friend look kindly on the wish to build a number of extra classrooms in our secondary schools to accommodate them?
  Mr. Austin Mitchell: At least the hon. Gentleman has no need to fear an influx of children of Conservative Members, since they all send their children to private schools.
  Mr. Pickles: We are very proud of some of the children who went to private schools in Brentwood, the hon. Member for Blackburn (Mr. Straw) being a prime example. We often see him at old boys' reunions. As someone who did not come from a privileged background, it is always nice to see the toffs doing well on the Opposition Front Bench.
  It is also important to concentrate on social services. Along with the rest of my hon. Friends, I have become increasingly worried about the way in which the Lib-Lab coalition on Essex county council has been abusing its

  1049
  position over care in the community. Essex is virtually unique in so far as it has received the largest allocation of special grants and SSA on personal social services. Unfortunately, it has a bunch of old-fashioned, municipal councillors who simply want to organise and control everything. They have ended the Conservatives' modernisation programme of old persons' homes, they have ended the modest charge for home helps and reduced the service, and they have taken money from social services to introduce stress officers for their staff—no doubt so that their staff can explain to the rest of the population why the service has been reduced.
  The Conservatives had introduced a scheme whereby a series of old people's homes, whose structure and decoration had been neglected, were offered for sale in the private sector. The controlling group on the council has stopped that process and essentially reduced the amount of money available to help old people get into private homes.
  In my constituency a home called Brook House, which is owned by the county council, was threatened with closure just before the last general election. Despite many protests from the local Liberal Democrats, who said that the proposed closure was a disgrace, the home was eventually closed. I had the pleasure of reopening it. Virtually the same staff work there, but in new conditions.
  Instead of looking like some kind of poor house or somewhere where old people are sent to be forgotten about—I am talking about the basic surroundings not the quality of the staff—the home now looks like a hotel. That says to our old people that we recognise the work that they have done, respect them and want them to see their last days out in some dignity. We know that it is cheaper for the county council to place elderly people in private sector homes instead of its own homes, yet it does not do so because of ideology.
  As I said to the hon. Member for Attercliffe, the private finance initiative is likely to come into being next year. It will enable county and district councils to use some of the disciplines of the private sector in renovating their libraries and schools.
  We must ensure that local authorities behave responsibly with their new responsibilities and flexibility. My council of Brentwood is controlled by the Liberal Democrats. The local leader was in the paper saying what a disgrace the settlement was, how the council could not manage on it and how there would be a massive hike in council tax to compensate for it. He predicted large council tax rises and said that it was all the Government's fault.
  Sometimes we politicians can be taught a lesson or two by members of the public who say the obvious and cut through much of the political froth. I am grateful to my constituent Mr. Michael Pointer who wrote to the Brentwood Gazette to comment on the local leader of the Liberals blaming the Chancellor for the prospective increase in council tax. He said:
  "In fact the Chancellor is increasing the cap by 1.75 per cent., but that does not mean our councillors need spend it."
  He points out that in 1992, the council took £4.2 million from the reserves and spent it on revenue, in 1993, it took £2.5 million and spent it on revenue, in 1994 it took £2.7 million and spent it on revenue and in 1995 it took just short of £2 million from the reserves. What the gentleman says in his letter is that the day of reckoning
  1050
  has arrived. Brentwood has a badly run council that has not applied basic housekeeping rules. Frankly, it has been deserted.
  Mr. Rendel: I thought—perhaps I am wrong—that the Government were trying to persuade local councils to use up their reserves, on the grounds that that is the best way to keep council services going.
  Mr. Pickles: The problem that my local councillors have is that they rely on the hon. Member for Newbury (Mr. Rendel) for advice, which is the road to ruin. The Government are saying, "We don't mind you using your reserves, but we want you to do so in a way that will get your budget down." It is no use substituting measures and hoping that one day something will turn up. The hon. Gentleman has let those councillors down terribly, because he produced an alternative budget that proposed not a penny-piece extra for district councils. He is saying to the Liberal district councillors in Brentwood, "Sorry, chaps. I've deserted you. We want to make education a priority."
  I appeared on a television programme with the hon. Member for Newbury. He is very nice to be on television with; he is a very nice man indeed. When I put the point to him, he looked shocked. I do not know whether he was let down by his hon. Friends in his Treasury team—
  Mr. Robert G. Hughes: Nobody told him.
  Mr. Pickles: My hon. Friend suggests that no one told the hon. Gentleman. I suspect that that is true. If it is, I do not think that that was fair. He should have been told.
  I had an opportunity to talk to my hon. Friend the Member for the Isle of Wight (Mr. Field), who told me about his Liberal-controlled council, which has been given an extra £1.5 million for its education budget. It did not want to give that money to schools, so there was a tremendous row—Liberal against Liberal, shouting at one another. Eventually it offered a compromise: it will keep £300,000 and let schools have the rest.
  My hon. Friend the Member for Isle of Wight and I say, "let the schools have the money that has been allocated to them." We shall judge the settlement by whether the money is passed on. Will priority be given to education and social services? If Opposition Members do not do that, we will not, under any circumstances, allow them to forget it.
  6.41 pm
  Mr. David Rendel: The Chancellor pledged in his Budget speech last November that an additional £878 million would be made available for investment in education in 1996–97. Of that amount, £770 million was to be channelled through local government. We now have the finalised local government settlement, but we do not have the additional £770 million that was pledged. The total amount of external finance for local authorities has not risen in real terms. That is the important point. All that the Government have done is to raise the standard spending assessment for education by 4.5 per cent.
  To make that increase meaningful, the Government have at least raised the capping limits for many authorities this year. As we heard from the Secretary of State earlier,

  1051
  however, the Government have refused to do what many hon. Members have called for and to remove capping limits altogether. If the Government are serious about local democracy, it is time that capping went.
  Mr. Barry Field: I wrote in my local newspaper on the Isle of Wight that the council and the Liberal Democrats had campaigned for capping limits to be raised or abolished, but they said that they had never asked for that and tried to suggest to school governors on the island that that was not Liberal Democrat policy. I should be obliged to the hon. Gentleman if he would emphasise the point so that I can take it back to the Liberal Democrat councillors on the Isle of Wight.
  Mr. Rendel: I am delighted to underline Liberal Democrat national policy. I cannot tell the hon. Gentleman precisely what was said on the Isle of Wight, but I can tell him, happily, that it is also Conservative party policy, as passed at the last conference, although the Government have not yet taken that on board. Only when capping has been removed can people really hold their councillors to account, because only then will councillors face making real choices about the provision of services and how to fund them. With capping in place, it is not the local electorate who decide what value to place on education for their children but the Secretary of State in London.
  There are two ways of looking at the line taken by the Chancellor and the Secretary of State. We could assume that the Government are recommending that councils stick to the SSA for education. If so, it should be noted that last year local authorities spent more than the Government recommend that they spend this year. If we assume that the Government really want councils to stick to their SSAs, that will lead to a cut in education spending, not an increase. If, however, the Government are urging local councils simply to spend 4.5 per cent. more on education regardless of whether they were above SSA last year, with no additional funds from central Government, they are calling for a substantial increase in council tax, coupled with a programme of cuts in other local authority services. Even then, it will not be possible for many education authorities to boost spending by the amount that the Government suggest.
  I realise that Conservative Members may be unwilling to take my word on that, so I will quote the words of the Treasury Select Committee, which published its report on 15 January. That Committee, which has a Conservative majority, revealed the extent of the Chancellor's con trick when it said:
  "This increase in spending does not, however, have quite the substance the Chancellor claimed for it."
  It went on:
  "Moreover, when the increase in spending is placed in the context of local authority resources, it seems less likely that, whatever the expectations of parents, local authorities will be able 'to carry that funding through to school budgets.'"
  The Committee concluded:
  "There seems little doubt that some local authorities will be unable to pass on any increase in spending, and that some schools may neither perceive nor receive any increase in resources."
  The Government have told us throughout the debate that that would be entirely the local authority's fault, but the Treasury Select Committee has pointed out that it is inevitable, given the Chancellor's Budget.
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  Clearly, any increase in education spending will be a matter of too little too late. It will not even be enough to cover the £191 million needed to cover rising pupil numbers. Nor will it be enough to cover the £131 million required for additional costs in the provision of special needs education. It takes no account of the 8 per cent. reduction in schools' capital grants and credit approvals.
  Let us consider what it will mean to one education authority. In Cambridgeshire, the SSA for education in the current year was £226.1 million. Next year, it will rise to £237.3 million—up by 4.9 per cent. Generous, one might think. But Cambridgeshire, one of many shire counties no longer controlled by the Conservatives, has already decided to spend £241.1 million on education this year, because the present authority places a much higher value on education than the Government do. That is already some £4 million more than the Government suggest that the authority should spend next year. The extra resources this year have been found partly from reserves and partly by raiding other areas of spending, which have consequently been starved of funding to a level below even that which the Government think appropriate. As was bound to happen, the reserves have effectively run out.
  The Government are providing less money than Cambridgeshire was already spending. The authority has no money left to make up the difference. It has increasing pupil numbers and demands for special needs. Moreover, of course, it is not allowed to raise any extra funds because it is capped. In anyone's book, that can add up to only one result: cuts in education.
  It is no wonder that the teachers and governors of Cambridgeshire are up in arms. Those figures were produced not by some party political body, but by a combination of the primary governors group, the secondary governors group, the primary heads forum, the local education authority secondary heads, the Special Schools Heads Association and the National Association of Governors and Managers.
  I have used Cambridgeshire as an example, but I have received briefings from many other county councils showing that almost exactly the same is happening all over the country—in Cornwall, Devon, Somerset, Gloucestershire, Dorset, Berkshire and Hampshire. The list continues across the country.
  Mr. David Harris: The hon. Gentleman mentioned Cornwall. Will he cast his mind back to what was said in Cornwall a year ago by all his Liberal Democrat colleagues—that Cornwall would face horrendous cuts in school budgets, and that teachers would be laid off right, left and centre? They did a survey and produced bogus figures just before the local elections. Does the hon. Gentleman know how many teachers were actually laid off in Cornwall last year? They were fewer than the fingers on my hand.
  Mr. Rendel: I am delighted to hear that confirmation of how well Cornwall is being run now. The council has managed to avoid cutting a lot of teachers' jobs despite cuts in Government funding. That is a wonderful example of how well Liberal Democrat councils have managed.
  When the Conservatives have succeeded in infuriating such huge bodies of opinion in the way that I have described, is it any surprise that they have lost the confidence of the country?

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  I realise that statistics will abound in the debate, but there is one that is especially well worth recalling in view of the Government's claim that they are doing so much more for our schoolchildren this year. Since the general election the standard spending assessment per secondary school pupil in England has fallen by 9.5 per cent. in real terms.
  Time and again, the Government have raised parents' hopes that their children's education will get the funding that it deserves, only to dash those hopes when it is revealed that Government promises are nothing but a lot of hot air. Their attempt to con parents is motivated by the desperate desire to win votes, but they will soon realise that the British public do not take kindly to a Government who seek to pull the wool over their eyes, especially where the education of their children is concerned.
  The Secretary of State continues to play the Chancellor's fiddle. Yet he and the other Conservative Members are already gearing up to criticise local authorities which respond in the only way possible—by cutting services and increasing council tax. We have already heard such criticism in the debate.
  The Government themselves produced figures in the Budget Red Book showing that they expect a 10 per cent. increase in council tax revenue this year. That translates into an additional bill of about £61 for the average household. For the Government to cut income tax one day and then reimpose that tax burden in a less fair way the next is nothing new, but it is still dishonest: it is still an outrageous Conservative sham.
  Mr. Pickles: The hon. Gentleman talks about dishonesty; would he care to tell us why not one penny piece of additional money was allocated for district council functions in the Liberal Democrats' shadow Budget?
  Mr. Rendel: As I hope has become entirely clear—indeed, I believe that the hon. Gentleman himself made it clear in his speech—the Liberal Democrats' priority now is to increase education funding and spending, because we believe that to be in the long-term interests of the country. We have made it clear that where necessary we shall raise income tax to pay for extra education spending. That is where our priority is, and that is where it will remain.
  Local Government finance is about more than council tax—
  Mr. Barry Field: I am interested in the Liberal Democrats' policy on education. I have seen a copy of the resolution passed at their conference which says specifically that the additional penny in income tax that they have said for some time should go to education would be spent on education for the over-16s and under-fives, which would not be relevant to this education debate at all. The resolution is quite clear.
  Mr. Rendel: I understand that the motion that the hon. Gentleman mentions was on nursery education and did not cover the whole gamut of what we expect the extra money to pay for.
  Local government is about more than council tax: it is about local services that are vital to the quality of life of ordinary, decent people. While local authorities have
  1054
  attempted to shore up funding for education, it is inevitable that other services have suffered. If local authorities now try to boost education spending by the proportion that the Government suggest, other services will have to be squeezed even further. The adjusted spending assessment for social services has been cut by 2 per cent. in real terms, so it seems that the Government regard social services and the vulnerable people whom those services exist to protect as expendable.
  The neglect shown by the Government in their funding of social services naturally manifests itself in some sad examples of how vital services have declined. I will give the House the opportunity to hear about two of them.
  I recently received a letter from a doctor in Hungerford, in my constituency, referring to what he described as the "sorry state of affairs" that the underfunding of community care has brought about. His patient had been trying to secure bath aids through social services. The House will appreciate that providing handles to enable somebody to get in and out of the bath safely and comfortably can be an essential ingredient in maintaining that person's independence. It is a vital safety measure, and may even save money in the longer term by enabling an elderly person to remain at home rather than having to go into residential care. The response from social services was that the gentleman would have to wait for up to a year—not to obtain the aids, but for a care manager even to visit his home to assess his needs. Goodness knows how much longer it would have taken to have the bath aids fitted. But the real sting in the doctor's letter comes in the last sentence, which reveals that the patient is 90 years old.
  Another case was brought to my attention by a special school in Hampshire which caters for a constituent of mine. The boy is described as
  "a very vulnerable pupil at our school which provides 52 weeks a year education and care for children with the most challenging behaviour associated with autism. The challenging behaviour can be life threatening."
  The young man is now approaching his 19th birthday, and once he is 19 he must move on from the school and will no longer be funded by Berkshire education authority. Responsibility then shifts to social services, which must find a suitable placement.
  The school has been pressing social services to place the young man for the past 12 months, but social services have been unable to do so. Meanwhile, the school has provided a place for the boy at a community care home and merely wants social services to agree to fund the placement. But social services have been unable to confirm funding for the placement, on the grounds that they need to find something cheaper. The interests of the young come second to the rigours of an underfunded budget.
  In the words of the school:
  "With Government pressure on education, care and health budgets, these children and young people are now the victims of a bureaucratic 'ping-pong' between Education and Social Services pre-19 and Social Services and Health post-19 as they argue about who will provide what proportion of funding for their placements."
  Those two examples are but the tip of the iceberg, but both show how the Government have put short-term tax bribes before the provision of essential services. In the long term their policies will lead to greater expense, and the tax increases that we have witnessed since the general

  1055
  election. The Government have failed to provide the funding for local authorities to make community care work.
  That is not the end of it. The Government are also cutting the funds for highway maintenance. I understand that Somerset, for example, is so desperate to safeguard education spending that it has imposed a cash freeze on highway spending, despite increasing numbers of claims for damage to vehicles, and to human beings as a result of falls. There is more: the Government are also cutting the funds with which local authorities attempt to protect the environment.
  Those cuts in every area of local government services will be the prime concern of most ordinary people. In many areas, people will have to put up with cuts in services combined with steep increases in council tax. A further problem is that in calculating spending assessments no account has been taken by the Government of the burden of the landfill tax this year. I hope that local authorities will reduce their use of landfill, and as an incentive to that end I welcome the landfill tax, but in the short term many local authorities will face a considerable burden in terms of the landfill tax.
  In Gloucestershire, for example, the impact will be £740,000 in the financial year 1996–1997. Where do the Government believe that cuts should be made to find that money? In a full year, the impact will be about £1.5 million. Even with the change in national insurance contributions promised for April 1997, the impact on Gloucestershire will still be well over £1 million.
  What cuts do the Government recommend to find the money for the new tax? Should cuts be made in education? The county's spending on education is over the SSA, yet it has had to make significant cuts in school budgets for the past five years. Should cuts be made in social services? Only today, a demonstration took place outside shire hall in Gloucester about possible cuts in services, including child care provision and adult opportunity centres.
  It is frustrating for us all that the Secretary of State has still not rectified the iniquity of the area cost adjustment. I was glad to hear the right hon. Gentleman say today that there is a possibility of future adjustments to the scheme, but that has not happened yet. It makes no sense to place a higher value on the educational needs of children living on one side of the Hampshire—Dorset border than on the other. After all, teachers' salaries are effectively identical in both areas.
  The Government are simply starving local authorities of resources, and they are doing so deliberately. They are gambling for electoral gain. The Conservatives' strategy is clear: hammer local government to help pay for tax bribes and, if there is any backlash, blame the Opposition parties who run most councils anyway. They are making one last desperate effort to stop the Liberal Democrat tide sweeping the Conservatives from power right across the south of England in the May local elections, but it will not work. Nobody trusts the Conservative Government any more. Sleaze, incompetence and downright dishonesty have all taken their toll.
  It is ironic that the party which promised tax cuts but delivered tax increases now attacks the Labour party for saying one thing and doing another. Tory Members who
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  want to see evidence of what is happening need only look towards their own grass roots. The Conservative party's grip on local government has been decimated, not least by the Liberal Democrats, who have turned the political map yellow from Cornwall to Norfolk, from Cheltenham to Worthing and from the Isle of Wight to Harrogate.
  Mr. Curry: The hon. Gentleman has his party's Treasury spokesman, the hon. Member for Gordon (Mr. Bruce), sitting beside him. As he has given a long catalogue of the deficiencies of the settlement—in social services, community care, education, environment and highways—perhaps he would like to suggest by how much he thinks the Government's grant to local authorities is deficient. If there is to be a "Liberal Democrat tide" people will want to know how much it will cost.
  Mr. Rendel: The Minister should have heard by now that we want to put a penny on income tax to pay for increased funding for education. That is our clear priority, and always has been. We have also said that we wish to release housing receipts to enable local authorities to spend more in other areas, but particularly on housing. We also want to change the whole method of financing local government by introducing a local income tax and by removing the cap.
  Last May, the Liberal Democrats relegated the Conservatives to third place in local government—not just in terms of the number of councillors we have across the country but, more importantly, in terms of the number of councils we control. When will the Conservatives get the message? They are not trusted to run local authorities and in a matter of months it will become clear that they are not trusted to run central Government either.
  It is ironic that a key factor in the breakdown of trust in Conservativism at every level of Government will be the way in which the Tory Government have treated local councils and local services. The Conservatives will deserve all that they get in the local elections in May and in the general election whenever it comes. But even that will be poor compensation for the rundown of local services over which they have presided. It certainly offers no immediate solution to my 90-year-old constituent who cannot bathe in comfort or safety, or to the parents of the autistic young man for whom a sufficiently cheap placement cannot be found. This financial settlement is a disgrace, and the fact that Ministers and other Conservative Members have the gall to commend it to the House shows how shoddy their politics have become.
  7.5 pm
  Mr. Michael Clapham: The speech of the hon. Member for Brentwood and Ongar (Mr. Pickles) was interesting, but I shall not be led down the route that he would have taken the House. The hon. Gentleman referred to the fact that there have been no vicious cuts. I hope to be able to show him that there are cuts, but that they have been well hidden by the Government's presentation of the settlement.
  In November, the Secretary of State for the Environment announced in Parliament the Government's financial settlement for 1996–1997, along with proposals for expenditure and capping-related matters. The

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  Secretary of State today confirmed the announcement. I want briefly to examine the main direction of the national settlement, and look at the implications of that settlement for my local authority, Barnsley metropolitan borough council.
  The local authority associations told the Government in July that there was an ever-increasing gap between the demands placed on local authorities by central Government and what the local authorities are allowed to spend to meet those demands. That puts in a nutshell the dilemma in which local authorities find themselves.
  In July last year, the local authority associations informed the Government in two comprehensive papers that increased demand plus the new priority requirements for spending would mean that local authority spending needs, as far as total standard spending is concerned, would be some £47.97 billion for 1996–1997. The Government proposal that we have heard today, however, is for £44.923 billion. The Secretary of State claimed at the Dispatch Box today, as he did back in November, that that represents an increase of 3.3 per cent. on the previous year.
  The Minister will agree—the Secretary of State did not in any way challenge me when I raised this point—that that 3.3 per cent. is not, in effect, an increase at all. When the figure is adjusted to take account of the provision for local government restructuring, community care and the police, the adjusted increase is 2 per cent.
  Given the Government's forecast of an inflation rate of 2.75 per cent. in 1996–97, that means an overall decrease of 0.75 per cent. rather than an increase. That is a clear example of the Government saying one thing and doing another. Local authorities will be in an horrendous position next year. Moreover, as the local authority associations pointed out, authorities had calculated that they would require £3 billion more than the Government propose to provide.
  There are three ways in which local authorities can deal with the problem. The hon. Member for Brentwood and Ongar (Mr. Pickles) said that many authorities could use reserves. Others, however—including mine—have no reserves to use. Because Barnsley's SSA is only 1.9 per cent. above the capping level, we cannot take that route, either. Therefore, like many other authorities, we are left with the option of cutting services year on year, and that has begun to affect people's quality of life.
  Barnsley metropolitan borough council has again been asked to make large cuts. Following last year's cuts, which amounted to £10 million, it is estimated that this year's will come to about £7 million. Barnsley's provisional SSA for 1996–97 is £159.335 million. I admit that that is 6.5 per cent. higher than the 1995–96 figure, but, after adjustments for community care and rail support funding, the underlying increase is just 2.8 per cent. Given that Government inflation forecast of 2.75 per cent. for next year, it becomes a freeze in real terms.
  Barnsley is now 31st in the SSA league table, whereas last year it was 32nd, but we are still at a considerable disadvantage in comparison with most other metropolitan boroughs. In other boroughs, the average SSA per head is 12 per cent. higher than ours, which is £687. The average is £770.
  Furthermore, as in previous years, the level of tolerance of spending above SSA varies widely. It is generally accepted that this method of calculating local government
  1058
  finance involves considerable imprecision, and that is borne out by the fact that some authorities with SSAs implausibly higher than Barnsley's are allowed to exceed them by 12.5 per cent. Barnsley is permitted an excess of only 1.9 per cent.
  The average level of tolerance for metropolitan boroughs is 5.5 per cent. Barnsley, however, is restricted both to a low SSA and to a low level of tolerance. The Minister will, I think, accept that any rational system would allow authorities such as Barnsley a much higher level of tolerance, so that they could be flexible in meeting local demand. As that is not built into the system, however, there is some irrationality.
  The equation for education spending is somewhat imbalanced. The hon. Member for Newbury (Mr. Rendel) gave the figures. The education SSA is purported to have increased by £740 million, but the overall SSA has increased by only £677 million. If the Secretary of State's equation is to be balanced, it will have a far-reaching effect on local authorities. Resources will have to be siphoned from other essential services in respect of which—as I have pointed out—there is a negative inflation provision. In Barnsley, many services provided for elderly people will be hit.
  Barnsley makes the delivery of effective education a priority—it spends 45 per cent. of its budget on education each year—but its position is very similar to the national position that I have described. Increases in education spending that match the purported increase in the education SSA will rob other essential services.
  Barnsley is probably more deprived than most other metropolitan boroughs of a similar size—
  Mr. David Clelland: More deprived than Westminster.
  Mr. Clapham: Indeed.
  More than 8 per cent. of adults of working age are registered permanently sick, compared with a national average of 4 per cent. Because Barnsley is traditionally an area of heavy industry and contains an aging population, a large proportion of the adult population are informal carers—12 per cent., according to an estimate that I saw last year. The pressure on social services and care in the community is greater than it is in most other districts, and the Minister should ensure that that is taken into account in the allocation of resources.
  Between 1981 and 1991, total employment in Barnsley fell by 19 per cent; over the same period, there was a national increase of 3 per cent. In the decade between 1984 and 1994, more than 15,000 jobs were lost, and the gross domestic product in the Barnsley and Doncaster training and enterprise council area is estimated to be 41 per cent. below the national average. Factors such as that should he paramount in the allocation of resources.
  The Minister will be aware that Barnsley and hon. Members representing South Yorkshire have raised the issue of the supertram time and again. My hon. Friend the Member for Barnsley, Central (Mr. Illsley) will be discussing the subject in his Adjournment debate on Monday, so I shall not go into the subject in too much detail. I understand that the debate is a matter for the Secretary of State for Transport, but the Minister may want to ensure that one of his colleagues is present.
  Mr. Curry: The hon. Gentleman will know that I have had extensive exchanges on the supertram with Mr. Mike

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  Bower, the leader of Sheffield council. Equally, the other districts that are part of the transit authority have made representations. We are seeking clarification of some of the actions that might be possible and continuing that discussion with the authorities concerned—there has been a useful defining of options.
  As the hon. Gentleman said, the Adjournment debate on Monday will hopefully give an occasion at least to clarify those aspects that fall within the remit of the Department of Transport. I shall continue to pursue the matter. The hon. Gentleman will acknowledge, as will all the local players, that the number of people using the tram has been disappointing. The fundamental problem has been that the take-up—the number of passengers carried—has fallen below the estimates. That is the heart of the matter, and we could discuss it at some length.
  Mr. Clapham: I welcome the Minister's response. I will not take the issue further, other than to say that it has caused unexpected damage to services in the district. That has been all the more disappointing because we understood that assurances had been given.
  The real challenge for an area such as Barnsley is trying to restructure after the enormous dislocation caused by colliery closures. It is a problem that the council is determined to overcome. We must recognise, however, that Barnsley has a narrow industrial base, which needs to be expanded and diversified. Traditional industries, such as coal mining, placed too little emphasis on personal development. Upgrading skills and educational attainment is a necessity and has become a key objective for the authority. The rebuilding of infrastructure, much of it worn out, is crucial if we are to attract investment to sustain the area.
  Those are formidable challenges for the local authority, but each year, as we start to come to terms with some of the issues—I accept that city challenge money has helped to restructure the local authority—local residents find that their quality of life is worsened because of the system of central Government finance, which is, to say the least, not sensitive to the characteristics of the community. I ask the Minister to review the finance mechanism for local authorities, to ensure that authorities such as Barnsley, which are in most need, are adequately assisted to move forwards.
  7.22 pm
  Sir Peter Hordern: There was a leak from the Liberal Democrat Whips Office the other day. I am glad, therefore, that the hon. Member for Newbury (Mr. Rendel) is here. Perhaps he can confirm some of the things that were leaked from that office. For example, on Liberal health policy, the document said:
  "Liberal Democrat policy on GP fundholding is found to be 'at best, confused, at worst duplicitous'.
  Their policy to put councillors in control of local health authorities is 'a barmy idea'."
  On local government it states:
  "Noting that some of the parties' councillors are 'potentially a liability', the Liberal Democrat policy staff also believe that: 'Under the Lib-Dems local income tax you would pay income tax twice.'"
  Mr. Rendel: I am grateful to the hon. Gentleman for giving me a chance to reply. He will realise that the point
  1060
  of that leaked document was to bring out the misrepresentations of our policy that we expected other parties to produce. That is precisely what he has done, exactly as expected.
  Sir Peter Hordern: I have heard some pretty good Liberal Democrat stories in my time, but I have never yet heard them put out a policy for the sole purpose of arousing Conservative comment, which they can then dismiss. That is remarkable.
  To turn to the subject of West Sussex, it is true that the Liberal Democrats have not held office before, and that they have had to play the part of opposition for more than 100 years, which can be a baleful exercise—[Interruption.]—as the hon. Member for North-West Durham (Ms Armstrong) knows from experience.
  Last year, West Sussex had an extremely favourable revenue support grant settlement—the second best in the country—and the highest increase in standard spending assessment in the country. Not content with that, the Liberal Democrats proceeded to raid the balances, spend the cash and increase spending by more than 5.5 per cent. in one year. They did it in the knowledge that that sort of thing could not conceivably go on for ever. The public expenditure White Paper forecasts the likely flow of public spending for three years. Nevertheless, they behaved like children let loose in a sweetshop, and started to spend as if there were no tomorrow.
  The results are there for all to see. The balances of West Sussex have been run down, and now the Liberal Democrats complain that the outlook is difficult. They complained months before the revenue support grant settlement was reached and wrote to the governors of every school in West Sussex complaining that school budgets would have to be cut by £25 million in the next two to three years—a specific figure.
  Naturally, my colleagues in West Sussex were deluged with letters from very concerned governors and parents. There was no basis for their concern. I see that the hon. Member for Newbury—a Liberal Democrat—takes credit for that. It is exactly the kind of behaviour that people in West Sussex will never forget—a false alarm based on duplicitous behaviour.
  West Sussex has received another reasonable settlement for the coming year, and it will be interesting to find out just how much of it is spent on education.
  Nothing is more annoying to Members of Parliament than to find that, although a settlement is favourable for education and all local authorities are told that they should spend their money on education, they spend it not on that but on other things; and that, where they do, it goes to the local education office and not to the schools. My hon. Friend the Minister and his hon. Friends in the Government will have to find some way of ensuring that the money that Parliament proposes should be spent on education is spent on schools and I hope that he will mention that in his reply.
  I do not know the best way to secure that aim, but it is important. One has only to consider the vast disparity between the amount of money that goes to schools and that which is kept by the local education authority in the different authorities. I hope that the Minister will look into that matter, and that, next year, when we return to the revenue support grant, some method will be found of ensuring that the money actually goes to schools.

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  There is, of course, no more important authority in the country than Horsham district council. Horsham is a totally blameless authority, with low spending. For many years, it was well below its SSA.
  The population of Horsham has increased, and the level of Goverment support has been reduced. I do not complain about that, but matters become difficult if the cap is reduced in line with spending. It is difficult for a local authority to plan its future when it knows that the population is increasing, if it cannot take the total support from the Government in one year as the base for another. If it cannot do that, it is lost in the whims of the total SSA calculation, which no authority can accurately compute.
  I do not complain about the SSA system, but low-spending authorities, typically those spending rather less than their SSAs, should not be penalised by the formula and the capping mechanism. My hon. Friend the Minister should examine that.
  There is one other small point that appears to be inequitable. What if a council appeals against the business rates and finds that, due to the Inland Revenue revaluation, they are higher than originally expected? Horsham council—correctly, in my opinion—decided that the money should be returned to the council tax payers. After all, they should receive the benefit of a more accurate valuation.
  It seems hard that Horsham council should be penalised because it has returned the money to the council tax payers rather than hanging on to it. Assessments should be based on the most accurate estimate of business rates, as corrected by the revaluation exercise. If there is a deficit for that reason, it should be made up in the revenue support grant. Horsham council acted properly in returning the benefits of the revaluation exercise to council tax payers. I ask my hon. Friend the Minister to consider that, especially in determining the SSA for Horsham council next year.
  Many hon. Members—especially those outside its scope—are concerned about the area cost adjustment. They say that it is disgraceful. I think that the area cost adjustment is much maligned and fully justified. Not enough of my colleagues from the south of England stick up for it. It is an excellent refinement that accurately reflects the extra costs of West Sussex and other parts of the south. I notice that the chairman of the review body comes from Edinburgh. I trust that he will remember that he is a Scot—at least, I hope he is—and therefore strictly neutral.
  Mr. Curry: I hope that my right hon. Friend will forgive me, but the chairman is an Englishman, working in Scotland. The other members of the review panel are a Scot and an Ulsterman. Local authorities in England had difficulty in agreeing on an Englishman to serve on it.
  Sir Peter Hordern: It would have been much better if a member of the review panel had come from Sussex. It should be strengthened by someone whose area gets the area cost adjustment. The panel will naturally proceed on its way with all due academic detachment, but it would have been better if it had been able to take into account the views of local authorities in the south which benefit from the admirable instrument of the area cost adjustment.
  7.33 pm
  Mr. Harry Barnes: I want to discuss the standard spending assessment for North East Derbyshire district council. There are certain peculiarities
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  about North East Derbyshire that need to be described. Sometimes, the worst case should be considered to test a formula. The SSA formula is inadequate and hits North East Derbyshire in almost every respect.
  One problem with the formula is the shape of North East Derbyshire. It is a sort of C-shape that wraps round Chesterfield, which creates problems. It is accepted by the boundary commission as a sensible and viable authority, but the formula creates some difficulties. For instance, the head offices of North East Derbyshire district council are in Chesterfield, which is in another district. That means that standard spending assessment drifts into Chesterfield, even when the councillors and officials of North East Derbyshire work there. That shows that the formula is nonsense.
  In North East Derbyshire, many of those fortunate enough to be in employment go to neighbouring authorities such as Sheffield and Chesterfield to work. The net outflow of population is 18 per cent., which is high. We have heard that Westminster has a net inflow of 81 per cent. and gets all sorts of SSA moneys as a result. We are at the other end of the spectrum but there does not seem to be any link between the figures that are taken into account for what is called enhanced population and the services that have to be provided.
  The services of a district council chiefly involve people who live permanently in that district, although they may travel for work or entertainment to other areas. Council planning, housing, refuse collection and other costs tend to relate to the services that are provided not for the transient population but for the fixed population.
  North East Derbyshire is a socially mixed area. There is a clear distinction between the western and eastern sides. The east end is more working class than the west end. Classically, when Conservatism was strong, the west of the constituency was a strong Conservative area and the east was strong Labour. This affects the operation of SSA because the wealthier elements on the western side are placed upon the backs of the poorer people in the eastern side when the formula is being worked out.
  What my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) said about Westminster has been attacked by some Conservative Members as being obsessive. That case is fascinating to us in North East Derbyshire because Clay Cross, where councillors were debarred and surcharged, is there. The scandal in Westminster involves £29 million. The Clay Cross case involved expenditure on behalf of its residents that amounted to something like £60,000. The second group of 11 Clay Cross councillors were debarred over an amount of just over £2,000. They had to be dealt with jointly and severally.
  We in North East Derbyshire are very interested in what goes on in Westminster. That case involves £28 million, while the SSA for North East Derbyshire district council is £7.3 million. A bit of that, handled properly and sent to a needy area, would have been used very well by us.
  The formula for the standard spending assessment is covered on page 53 of the booklet, "Local Government Finance Report (England) 1996/97". The formula first considers population, which I have already discussed. North East Derbyshire's total resident population is 99,180. That gives, under the formula, a standard spending assessment of £8.4 million. As I have said, when

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  the sums are worked out, the amount shrinks to £7.3 million. To start with, we lose £368,000 because of the population's movements during the daytime into surrounding areas. We receive little in terms of night stays and day visitors because, although we are near to national park territory and a bit of such territory clips the end of the district, the region is not used greatly for such a purpose. People from outside use certain facilities: they come from surrounding areas to go out for evening meals in Dronfield. Generally, however, the region is not able to supply the type of facilities that draw in such extra revenue.
  The next factor to consider is population density. That is considered within "enumeration districts". North East Derbyshire is not doing as badly as it has in the past. Previously, wards, not enumeration districts, were taken into account. Because North East Derbyshire region was a C-shape and the wards cut across it, we managed at one and the same time to finish bottom of a table of population density and bottom of a table of population sparsity of comparable authorities as provided by the Audit Commission. The system made calculations on that basis, but dustbin collection is difficult both in rural areas and in highly concentrated urban areas. We probably had more problems in dustbin collection than many other areas because of the region's shape and we had the costs that went with them.
  Thankfully, there has been some adjustment in both the sparsity criteria—although we are worried that some of that will be dropped—and in the density criteria. It shows that one can change the formulae to make slight improvements. Those, however, are minor compared with the Herculean task that we face when presented with the consequences of the formula.
  The next set of criteria is the social index. Under that index, North East Derbyshire loses £1 million. We do not score well in terms of the proportion of persons sharing accommodation, with more than one person per room or the proportion of people living in flats. The building, especially by Clay Cross urban district council, of decent council housing in the region has meant that resources to tackle its problems are not available.
  North East Derbyshire does not score either in terms of the proportion of residents who were born outside the United Kingdom, in the Republic of Ireland, the European Community, the Commonwealth or the United States of America because it has one of smallest ethnic minority populations of any district in England. I do not question the criteria of ethnic provision being considered, but we do not gain anything from such criteria, which are surmounted by other problems that people face. That is not taken into account. The homelessness provisions are based on the 1991 census, but it is getting worse. The current homelessness level is not being considered.
  That loss of £1 million is serious to North East Derbyshire and is not justified by the circumstances and conditions there. There must be an adjustment in the formula.
  Then there is the economic index. At one time, such an index did not exist and issues such as unemployment were not considered. In areas such as Gosforth Valley, which is part of Dronfield, and Ashover, which is a big rural
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  area, the unemployment level is down to about 4 per cent. In Danesmoor, Clay Cross, Renishaw and Holmewood and Heath, however, it is 20 per cent.
  Criteria involving unemployment and long-term unemployment, housing benefit claimants, lone parent families and the mortality rate of people under 75 score highly on the eastern side of the district, but the numbers are diluted considerably in the western area. Therefore, we lose on those criteria as well, even though strong needs exist in the eastern district.
  After we work through the above calculations, we come to something like the figure that we started out from: an £8.5 million SSA. However, as with all other authorities, North East Derbyshire is subject to the scaling factor. The figures are multiplied by 0.93021227385—the scientific precision of the Government's scaling factor is incredible. It is worked out in terms of how the authority fits the formula into the total amount that will go towards the differing areas. The figure is multiplied—or reduced because the multiplication is by a figure under 1—by 0.93 rounded up, which means that the amount drops to about £8 million.
  Last year, the scaling factor was 0.9979, which was reasonable. Why suddenly has the scaling factor been chopped by such a dramatic amount, leading to considerable cuts? Other cuts arise because, in the formula, amounts of money are transferred to the county council from the district council. Some extra money comes in from rent allowances and interest receipts, but, in the end, we have an SSA of £7.3 million, which is a serious cut on the level that existed the previous year. It is a 7.3 per cent., appropriately, cut on last year's figures.
  That figure does not take inflation into account. At no time have the Government produced any of the figures that we are discussing in terms of their real value, comparing one year's monetary values with another. They say things about Derbyshire such as, "It has done very well in terms of education. It has had a 4.7 per cent. increase". But that is not true because the inflation rate has been 3.2 per cent. After doing the maths, the real increase is I think about 1.1 per cent. Even taking that into account, other reasons exist for criticising the Government. Derbyshire is already spending beyond that level on education. That means that, with the Government's figure, there will be no increase in the education budget, which is part of the county council's provision.
  North East Derbyshire is suffering an 11 per cent. cut in its SSA—the amount that it is expected to spend. The new provisional capping levels produced in the documents today are only marginally above the SSA for last year—the figures are almost identical. That means that, even if the authority pushes up the council tax considerably, it will reach only last year's figures, which do not mean the same this year because they have been eaten away by inflation.
  What are we supposed to do? We are supposed to get a bit of money from the business rate. After inflation, the business rate provision is much the same. In the connection with the business rate, the formula works in that way.
  The rate support grant is down by £621,000—nearly 30 per cent., taking inflation into account. That is a ghastly position, and it is well worth contrasting with that of Westminster. If the funding formula that operated for

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  Westminster had operated for North-East Derbyshire, instead of charging council tax we would return £759 to each home.
  What are we to do? We must try to make good the shortfall by increasing council tax. If we do so at the level that the standard spending assessment suggests, we shall nevertheless fall short by about 11 per cent.
  I am sorry that I have had to produce so many figures, but they are worth producing to show the way in which the formula operates. We have known for a long time what is wrong with the formula as it applies to North-East Derbyshire. The enhanced population is a reduced population. The economic and social factors do not take into account needs in the area. Greater flexibility and movement are needed in the operation of the formula.
  We suffered previously from the nonsense of the sparsity and density factors. Even if those problems had all been overcome, they would continue to affect us from the past, because all sorts of services have had to be cut or increased revenue has had to be raised by the council tax and poll tax, simply because of the pressures that existed on us. We need to be able to recover from the position in which that nonsense has placed us.
  No one could accuse North-East Derbyshire of being a profligate authority. It is the successor authority to Chesterfield rural district council, Dronfield urban district council and Clay Cross urban district council. Clay Cross urban district council, which I fully supported in its battles, could be regarded as seeking to defend its community. If that council was regarded as profligate, North-East Derbyshire has not acted similarly. North-East Derbyshire has sought to operate respectably. It has been obliged to operate fully within the rules and has not at any time created any problems that might be used by the Government to denigrate its activity.
  The Government denigrate Derbyshire county council with great exaggeration. I wish that I had the time now to go through the accounts of Derbyshire county council and the criteria that are taken into account when calculating its standard spending assessment, because only part of its provision is covered by what I have said. Different considerations apply to the police and education.
  Police is a problem. Derbyshire police authority is asking the appropriate Minister to visit the area, because we need our certificate of competence returned and we need the resources to achieve that.
  I wish to place on record the importance of North-East Derbyshire. The Government should consider it closely to rectify the nonsense of the formula that is applied to it. Although we do not have destitution throughout the area on as wide a scale as might exist in other areas, the formula does not fit us in any way and tells against us time after time.
  7.52 pm
  Mr. Sebastian Coe: I am delighted to speak in the debate. I shall not detain the House for more than a few moments. I am pleased to he able to welcome the local government settlement for 1996–97. I do so for local and national reasons; it is impossible to divorce the two.
  Virtually everything that we, as constituency Members of Parliament, hope for and promote—and our constituents' aspirations—depends on the way in which
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  we consider our spending nationally. That impinges on inflation, on tax policy, on ensuing interest rate policy and—although there has been little mention of it during the debate—on the percentage of gross domestic product that the Government take out of the economy. Those issues must be considered.
  I welcome the settlement in local terms because the three key beneficiaries of this year's settlement were education, health, in terms of our care in the community settlement, and the police—law and order. Hon. Members know that those three issues, especially in my constituency but in constituencies the length and breadth of the country, have considerable resonance at the moment.
  I was interested in some of the comments made by the hon. Member for Newbury (Mr. Rendel), who spoke about the local government settlement in Cornwall and adopted a broad-brush approach. He is the Liberal Democrat spokesman. It is understandable that he will speak about the county. However, the Government's settlement for Cornwall, at more than 3 per cent., was generally accepted to be a good one. It was higher than that of any comparable county—and the national average was about 2 per cent. The education budget in the county increased last year by 5.6 per cent. That, in hard cash terms, is an extra £8.7 million going into county education against the background of a national increase of 4.5 per cent.
  Mr. Betts: The hon. Gentleman has said that the settlement for Cornwall was more than 3 per cent. As I understand it, the SSA increase is 3.1 per cent. but the actual increase in grant is 2.6 per cent. As that increase in grant is less than the rate of inflation, and less than the teachers' pay increase award and will not cover the cost of increased numbers of children, does the hon. Gentleman advise the county council to cut education, to cut other services, not to fund the teachers' pay settlement or to increase the council tax by more than the rate of inflation? What does he advise?
  Mr. Coe: I will not suggest any of those. I am suggesting that there are savings to be made. I am talking not about huge savings but about savings.
  It is interesting that, at this stage every year, we get into this ritual dance. I have been in the House for three years. I remember exactly the same debate this time last year, prompted by Liberal Democrat Members. Bogus surveys shot around the county, demonstrating in no uncertain terms that every Cornish child was £100 worse off and more undervalued than anywhere else in the country. We woke up on the morning of the settlement to be told that there would be mass redundancies. Radio Cornwall camped outside county hall. At the end of the day, as my hon. Friend the Member for St. Ives (Mr. Harris) knows full well, there were two and a half redundancies in the teaching profession in the county. There was no mass loss of jobs in county hall.
  We must move away from the meaningless argument that the index of assessment for local authorities is simply how large the increase in the internal directory is from one year to the next. We must talk about not only inputs but outputs. There must be some balance in the argument.
  Mr. Rendel: I am not quite sure what the hon. Gentleman meant when he replied to the previous intervention. It sounded as though he thought that he

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  could enable the circle to be squared, so to speak, by finding savings in unspecified areas of council spending, so that he could use those savings to increase education spending in the way that he would hope.
  If that is what the hon. Gentleman meant, I would point him to the remarks made by the Secretary of State earlier in the debate. Such savings, when they are spent on something else, are not savings at all, according to the Secretary of state.
  Mr. Coe: No. The point that I choose to make—and this is grown-up politics—is that the hon. Gentleman's county is run by the Liberal Democrats. It is, if I may say so, democracy. The council will have to decide priorities. That is no different from what Ministers do every day of the week. The priorities are simple. The hon. Gentleman must decide what the expenditure priorities are. His county was given the tools by the Government in key areas of expenditure. It is up to those people who represent my constituents at county level to determine those priorities. It is ludicrous to suggest that there is any process other than that.
  Mr. Harris: Did my hon. Friend by any chance hear, as a number of us heard one day last week, the Liberal Democrat Treasury spokesman blaming the Government on the "Today" programme for excessive borrowing and public expenditure? Does my hon. Friend have the difficulty that I have in squaring such remarks with the remarks of the hon. Member for Newbury and any Liberal Democrat spokesmen in the House? Whenever they are on their feet, they call for more Government expenditure.
  Mr. Coe: My hon. Friend makes an important point. As he knows full well, the priorities within Cornwall at county level are those of a Liberal Democrat-controlled council. They have to make their choices and set their priorities.
  I do not naively or coyly suggest that Cornwall's education settlement last year was anything other than tight. I know that it was. I and my hon. Friends the Members for St. Ives and for South-East Cornwall (Mr. Hicks) have close links with schools in our constituencies. I have a parliamentary education forum and I meet head teachers from all my schools at least four times a year. I am open about last year's settlement. I was told in no uncertain terms by head teachers last year that they were pushed. They had to dig deep. They did not get rid of teachers.
  I pay tribute to the quality of teaching in the county of Cornwall and the quality of governors of the schools. They had to make some difficult decisions and they made them well. Education in the county did not suffer. This year I am delighted that the settlement has been significantly more generous, in an economic climate that has allowed it.
  I wish to draw to the attention of my hon. Friend the Minister a concern that was drawn to my attention and that of my hon. Friend the Member for St. Ives in a meeting with Kerrier district council two Fridays ago about its settlement this year. My hon. Friend the Minister will be aware that within the constituency of St. Ives lies the Royal Naval Air Station Culdrose. It is among the largest helicopter training schools in western Europe. It is
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  a major provider within NATO cover. It is also a mainstay of the local economy. Research has shown that the defence sector supports 40 per cent. of the local economy of the Helston travel-to-work area, where many of my constituents are based. That is three times higher than the contribution of the defence sector to Plymouth. The air station contributes some £50 million to the district economy annually and to the economic well-being of west Cornwall.
  As a result of the reductions in armed forces expenditure some difficult decisions have had to be taken not only as part of "Front Line First" but as a consequence of the peace dividend. RNAS Culdrose is being rationalised and the number of personnel is being reduced, not by huge numbers. Thank goodness, Culdrose has not been affected as badly as some defence establishments, but a significant reduction has been made. The effect on the local economy, which is already hard pressed, is difficult and damaging.
  The area is already identified in Department of the Environment figures as the 17th or 18th worst unemployment blackspot in the United Kingdom. It is identified and highlighted in the Department's index of local conditions. In such circumstances, the rationale which purports to lie behind the SSA would dictate that the district's needs should increase to reflect the need for higher spending, greater social need and the commensurate reduction in the economic base. Instead, the reduction in the population as a result of the reduced number of service personnel, has worked right through the SSA formula to give us less support. I hope that the Minister can examine that issue. It was raised, sensibly in my view, by my local authority officials. I hope that my hon. Friend is at least able to reconsider some of the issues that are raised by that matter.
  Two key features of recent Government policy can and will change the face of local provision in some important areas. The first is the private finance initiative. I hope that within the next year or so we in Falmouth and Camborne, particularly in Falmouth in the south of my constituency, will have access to a properly funded and resourced community hospital. We have a hospital, but within the local arguments and toing and froing which is always necessary, we are looking to build a new community hospital in Falmouth and Penryn.
  It is my hope that that can and will be pushed forward by the PFI. It is perfectly reasonable to use that type of partnership to reduce the waiting list that often exists for money for such projects. I hope that the private finance initiative can help. I know that there is considerable local support for that.
  The second feature is the city challenge initiative. I was interested to read a speech made by the Leader of the Opposition in Southwark cathedral the other night. He welcomed the city challenge initiative as one of the major factors which had helped got rid of the Hulme housing estate in Manchester. A great deal of revisionist rewriting of history takes place on the Opposition Benches. I should point out that the Hulme housing estate was knocked down as a result of a decision made back in 1991 by my right hon. Friend the Member for Henley (Mr. Heseltine), now the Deputy Prime Minister, to push forward with city challenge.
  I do not wish to tax the House with the mechanism behind city challenge, which involved trading companies and various other partnerships, but it is fair to say that for

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  the Labour party to claim that it was a huge success for either Manchester council or a new idea from the Labour party in local authority provision is—I am trying not to use the word "hypocritical". It may have been ignorance or simply carelessness. This was a decision made by a Conservative Secretary of State, supported by good, solid, Conservative policy.
  I welcome the debate, and I welcome this year's financial settlement for the national reasons that I have identified and, more importantly, for the real benefits that it has brought to my constituency and the county of Cornwall.
  8.9 pm
  Mr. George Stevenson: Despite Conservative Members' increasingly desperate attempts to cover up what is really going on, we should state quite openly what the proposals represent. They are a continuation of a Government policy that has systematically undermined local government for many years. The orders will further undermine local government's ability to provide vital services for local people. That is the reality of the situation, as exposed today in the contributions of my right hon. and hon. Friends.
  I argue that that Government policy is motivated by two basic, and—I believe—flawed, political objectives. The first is a year-on-year reduction in the resources available to local government. I know that the Government would like us to believe that the world began in 1992, but some of us have longer memories than that. We have seen a year-on-year reduction in the resources available to local government, while at the same time the Government have embarked on what can only be described as a propaganda campaign. All hon. Members know that local government resources have been cut dramatically, yet the Government have tried to shift the blame on to local authorities. That is what Government Members have done this evening and no doubt the trend will continue.
  The second fundamentally flawed political objective is the Government's desire to take control of local government activities. We hear constantly how Conservative Members are in favour of freedom of choice and of national and local accountability. Yet, over a period of time, the Government have taken control of the activities of local government—they have effectively nationalised local government—in a quite breathtaking manner.
  The inevitable result of that systematic Government policy is the on-going crisis in vital services, such as education, social services and housing—to name only three very important areas. Central Government control of local government activities has resulted in historic blunders, such as the poll tax, for which generations in this country will continue to pay. That measure was a direct result of the Government's preoccupation with centralisation and their determination to centralise and nationalise local government activities. The Government's policy is based on the philosophy that central Government are best placed to determine local service provision.
  We could compare the efficiency of local authorities, and I readily accept that many arguments could be advanced to develop such a debate. However, we should not allow such arguments to cloud the fact that the
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  Government have made a fundamental mistake: they believe that the mandarins of Whitehall know best what the people of Stoke-on-Trent should have, what they should be doing and how much they should be spending. It has nothing to do with the Government's controlling the national economy—we accept that that is an important argument. However, when more than 80 per cent. of local government expenditure is controlled by central Government, that is not only damaging for local service provision but strikes at the heart of our constitution.
  Government propaganda in the past 16 years has sought to discredit local government, and it has forced some very effective local government services into oblivion. The Government have also tried to convince people that the local authorities have caused all of the current problems, but they have failed in that endeavour.
  I am particularly impressed by the way in which the Government have been hoist by their own petard. The Government have sought to blame local authorities for the successive reductions in education expenditure imposed on our schools—particularly last year's savaging of the education resource. However, parents are involved in their schools and I am sure that Government Members have been surprised by the way in which parents have turned round and said, "We don't believe the Government any more. We know what is going on here. We know that you are to blame and we are not prepared to tolerate it any longer." The parents know where the responsibility lies for the crisis in our vital services.
  The local government finance proposals signal the Government's intention to continue to perpetrate an elaborate confidence trick on the public. The proposals do not suggest ways of dealing effectively with the anomalies in the system. Many such anomalies have been referred to in the debate today, but I shall refer to what I believe to be the most serious and discriminatory anomaly in the present system.
  The right hon. Member for Horsham (Sir P. Hordern) referred to the area cost adjustment and the way in which it benefits the southern counties. He argued that it should not be tinkered with. I agree with the right hon. Gentleman: it should not be tinkered with, it should be changed radically. Before I detail that serious anomaly, I make it very clear that I accept that some cost differences must be reflected; no one is arguing that the area cost adjustment should be eliminated.
  I have six secondary schools in my constituency, one of which receives £340 per pupil less than a secondary school in Surrey. I do not wish to pick on Surrey, but it has more or less the same urban-rural mix as Staffordshire and it is also very comparable in other ways. When there is a difference of £340 per pupil in the secondary sector and a difference of £220 per pupil in the primary sector, I believe that the system is not reflecting the legitimate differences in the cost of providing given levels of service. It is blatant discrimination, and that abuse should be adjusted—if not removed—as quickly as possible.
  I welcome the fact that the Government have established an investigation into the matter. However, I am disappointed that, after all the banging on the Minister's door for three years, he has only now been forced, kicking and screaming, to set up the inquiry. The "Local Government Finance Report (England) 1996/972" contains the education formula:
  "The results of (a) and (b) are added together and multiplied by area cost adjustment for education;"

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  That is for primary education. There is another formula for secondary education, the result of which must also be multiplied by the area cost adjustment. The same applies to personal social services, other social services, the police, fire and so on. I estimate that if that serious anomaly were addressed, in my constituency alone, some £15 million would be available for education. One has to multiply by all those other vital services. We are talking about a loss of hundreds of millions of pounds in Staffordshire alone because of such discrimination.
  I hope that the Government will tackle that serious anomaly quickly and act on the report. I hope that they do not postpone matters until after the next election. I hope that my cynicism does not get the better of me. It would be a tragedy if the Government were to succumb to that cynical view and defer any action.
  As I said earlier, these proposals are a con trick. For example, the Government insist that the proposals represent an increase in resources over the past year. We should examine that claim in a little more detail. According to the Government's publication, there is an increase of 4.4 per cent. in the education SSA control total—that is about £754 million. That does not replace the savage cuts of about £860 million that were imposed last year. How can that be described as an increase? It bears no resemblance to what local authorities have been forced to spend on education simply to maintain the service. Many Conservative Members have claimed that there is to be an increase of 4 per cent. but, when one takes into account the figures I have mentioned, one can see that that is not true.
  The hon. Member for Brentwood and Ongar (Mr. Pickles) referred to local authority reserves. I nearly fell prey to the temptation of agreeing with some of what he said—I resisted. However, he made one valid point when he said that his local authority—I believe that he was referring to his authority—had been spending out of its reserves. Presumably, like many other authorities, it was simply trying to maintain services in the face of Government-imposed cuts. It could be argued that using those reserves camouflages what the Government are doing to our services. However, when the resources available to local authorities simply will not maintain those services, they have little alternative but to use those reserves.
  In Staffordshire last year, the county council used £7 million from its reserves to maintain something like an acceptable education system. This year, it will face similar problems. Staffordshire county council put in a bid for £17.5 million to maintain school buildings. The Government did not deny that the county council had made a good case. However, they simply drew a pencil line through it and said that the council could spend only £2.3 million to maintain its school buildings. So buildings that desperately need to be improved will continue to fall into disrepair.
  Another important point is that, by using those reserves, local authorities show that they are attempting to maintain services in a responsible manner in the face of continued Government cuts in resources. I praise local authorities that do that. Like everybody else, I know that it is no solution, but it compares notably with what the Government did last year when, after agreeing to a
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  teacher's pay increase, they ran away from it. That was a major contributor to the problems faced by local authorities last year.
  Local education authorities, schools and parents are only now beginning to realise that the Government's promise of more resources for education is nothing more than cruel deceit. The Government will be made aware of that realisation when parents begin to recognise exactly what is in store for the education service.
  I want to talk about social services where, if one could believe it possible, things are even worse. The SSA control total for personal social services is, according to the Government, to be increased by 0.7 per cent.—a miserly £51 million. I accept that there is £647 million of special transitional grant. The Government are actually saying that because they do not intend to provide any more resources for social services—there is to be a cut—local authorities will have to use some of the special transitional grant money to maintain the services demanded by the local population.
  Stoke-on-Trent city council is in my constituency. During successive meetings with the Minister of State and others, for which we are grateful, they have accepted that it is a reasonable, effective and efficient local authority. Despite that, its rate support grant is to be cut by 12 per cent. and its capping limit will, effectively, be frozen at last year's figure. When the Minister responds, I want him to explain why, when the Government are talking about a relaxation in capping limits, Stoke-on-Trent has the same figure as last year. That needs to be answered.
  We shall ensure that the public are fully aware of who is responsible for the continuing attack on their services and they will not be conned any more by the Government's desperate camouflage. There is only one small light at the end of the tunnel, which is that these proposals, like other Government policies, will hasten the Government's destruction at the next general election.
  8.27 pm
  Mr. Robert G. Hughes: The nine people in the Strangers Gallery probably share the view that the Labour party's anger over this issue has seemed rather half hearted and that, if things were as bad as it has tried to claim, the debate would have been better attended. In its heart, the Labour party knows that this is really a fair settlement for local government, as it represents an appropriate level of revenue spending for local authorities for next year of £44.9 billion, which is a 3.3 per cent. increase.
  It would be a good idea to look at how councils make their budgets. Twenty two years ago, when I was first elected to a council, I could not believe how they made budgets, and I still cannot believe it. I have with me Harrow's budget document. It is very pretty, contains many different colours and is very heavy. I have one recommendation to make to councillors—do not read it.
  Mr. Dobson: Does the hon. Gentleman realise—after all, he has not been here all day—that if he votes for the rate support grant settlement it will mean substantial help for Westminster? If his borough of Harrow were to receive the same amount per head as Westminster, it could pay a rebate of £436 to each council tax payer. If it were to receive the same help per pupil as Westminster gets

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  from the education settlement, it could employ an additional 470 teachers this year. Is it really a good settlement for those whom he represents?
  Mr. Hughes: That is typical of the smug cover story we hear from the Labour party; it is the only act it has. Everyone knows that the cost of running services in central London is very different from that in outer London or anywhere else. If it were not, why would so many Labour boroughs get larger grants?
  If the people of Wandsworth received the same level of grant as the people of Tower Hamlets, Wandsworth could rebate £1,000 a head. In Camden, where the SSA for the coming year is £219 million—
  Mr. Keith Vaz: Get to Harrow.
  Mr. Hughes: I shall come to Harrow in a minute and deal with matters there in some detail. When the hon. Member for Holborn and St. Pancras (Mr. Dobson) intervened, I thought he would explain why, in 1994–95, Camden took £4 million out of its education budget to cover bad debts incurred from interest rate swaps—an idea invented by the then Labour party local government officer who now sits in this House. That action had nothing to do with education. Will the hon. Gentleman intervene again and tell us why Camden did that?
  Mr. Dobson: If Camden is so bad in its spending on education, why are its education results far and away the best in inner London and about 10 times as good as Westminster's? Camden came second in the Government's national league table; Westminster came about 91st.
  Mr. Hughes: The hon. Gentleman should keep that information from his Front-Bench colleagues or they will be flocking to Camden. I know of no Labour Member who has taken his children away from a Conservative authority to send them to a school in a Labour authority, although many of them—such as the shadow Home Secretary, the shadow Health Secretary and the leader of his party—have done the reverse.
  Mr. Dobson: Does the hon. Gentleman accept that Camden council, with its excellent education service, is a net importer of a substantial number of pupils, including many from the Tory borough of Brent?
  Mr. Hughes: I am sure that the hon. Gentleman's figures are right, but not many people have the same rosy opinion of Camden. Of course, he has always been satisfied with his own information.
  Mr. Vaz: What does that mean?
  Mr. Hughes: It is clear what it means. I welcome the hon. Gentleman to the Opposition Front Bench on one of his rare visits.
  For people who have never been involved in the local government budget-making process, I should explain that it is a little like the notes my children send to Santa Claus. The difference is that at least their notes have pretty pictures on them. The similarity is quite stark; the budget-making process is a wish list, and everything that
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  is not granted is described as a cut. A council thinks of something that it wants in the coming year and puts it on the wish list. When the Government say that it can have a relatively generous settlement, but not enough to cover everything on the wish list, that is translated as a Government cut. Everybody knows that that is not true.
  In Harrow, the controlling Liberal group, with the support of the Labour party, has been banging on about a so-called programme for £20 million-worth of cuts. It is not true and no one believes it to be true. The Liberals are trying to frighten people and they are targeting the vulnerable. For example, they are saying that there will be a cut in the transport service that takes people to handicapped clubs and so on—at a cost of £67,000, from memory. To get people on their side, they are targeting vulnerable people and saying that the services they care about will be cut.
  The Liberals are also saying that there will be a cut in the money for schools. Harrow's SSA this year is £147.9 million. For 1996–97, it will be £152.1 million—an increase of £2.8 million. No one is suggesting that that will give Harrow money to throw around, but if it cuts the money for schools on the basis of that settlement, it can only be because the Liberal group chooses to do so.
  As a parent, I recognise the importance of good quality education. We all want to ensure that our children receive the best education possible. A starting point is the money that the Government allow councils to spend. For Harrow in the coming year, it will be just over £73 million, a 3.7 per cent. increase on 1995–96. I am pleased that, when money is tight, the Government are giving such a high priority to education.
  It is for Harrow council, however, to decide whether to spend that additional money on schools, as I urge it to do, or to retain it at the centre. Some of the items on its great big wish list involve employing more staff at the centre. The council does not have the balance right. It is clear that the new money, as well as a larger share of the existing budget, should go to Harrow schools. It would then be for governing bodies to decide whether to purchase services from the education authority. The most important point to remember is that any cuts made to the delegated budgets for Harrow schools would be the result of the controlling Liberal group deciding to do that. I shall continue to do what I can to prevent it from doing so.
  The council's story is that it already spends above SSA on Harrow schools. I am sure that that is right, but if it spends above SSA on education, it must spend below SSA in other areas.
  Ms Armstrong: No.
  Mr. Hughes: I am not quoting Government figures—they come from the Association of London Authorities, a Labour-controlled authority. If the hon. Lady disagrees with it, she must talk to her Labour party friends.
  If Harrow spends more on education, it must spend less on other areas, otherwise it cannot get within the capping limits set by the Government last year. With the additional money, there is no reason for the Liberal group not to continue education spending at the same level.
  The hon. Member for Stoke-on-Trent, South (Mr. Stevenson) tried to brush over the impact of the special transitional grant for social services. The effect on Harrow is not just the 0.7 per cent. increase in the personal social

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  services element of the SSA—it will have £30.7 million to spend next year, an increase of 6.6 per cent. in cash terms. That is a £17.663 million, or 92 per cent., real-terms increase on 1990–91—a large rise over a short time. In two areas that everybody agrees are priorities, Harrow has been given extra money. It is for the authority to decide how to spend the money and whether to make nasty cuts in transport for the mentally handicapped and delegated school budgets or to review its expenses.
  The first act of the incoming Liberal council was to increase councillors' expenses. The council has a choice.
  Mr. Stevenson: The hon. Gentleman made a point about personal social services which related to my claim that the Government are trying to hoodwink the public. Does the hon. Gentleman accept that a 0.7 per cent. increase is a cut in real terms, and that to include the special transitional grant required to provide for services transferred to local authorities is dishonest?
  Mr. Hughes: No, not for one moment. In cash terms, Harrow council will have 6.6 per cent. extra to spend on social services this coming year. It is fanciful to suggest that the council will have to cut certain social services. That claim is designed only to scare people.
  My hon. Friend the Member for Harrow, East (Mr. Dykes) and I have been in discussion with my hon. Friend the Minister for Local Government, Housing and Urban Regeneration, and I place on record our gratitude for the courteous way in which he listened to our points and for the action that he agreed. Our discussions related not to the coming year's SSA but to Harrow council's belief that there has historically been an underestimate of the amount that it should spend.
  Harrow has a large number of children approaching the age of five and the council is concerned about the associated expense of providing new classrooms or a new school. In the 40 years following the last war, the calculation of the number of five-year-olds who would present themselves at first school in the borough was broadly right, but for the past four or five years it has proved to be a gross underestimate. Nobody knows whether we are dealing with a prolonged bulge or a trend, which makes planning difficult. My hon. Friend the Member for Harrow, East and I made the point to my hon. Friend the Minister that that phenomenon should be taken into account in considering the money to be made available over the next few years.
  Local authorities are concerned about the effect of changes to the benefit rules—which, when it is convenient to Labour, have cross-party support. Some current Department of Social Security expenditure will be transferred to local authorities. The Social Security Committee report published a week ago stated that local authority associations and the Secretary of State should quickly reach agreement, so that everybody is clear as to the source of the funding required.
  Although that development is acknowledged in the SSA for the longer term, it does not take into account an influx of refugees into Harrow or any other borough. Most London boroughs, if not all, suffer from the same problem. My hon. Friend the Member for Harrow, East and I urged my hon. Friend the Minister to take account
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  of that factor and to consider what could be done to help at the front end when local authorities have to meet the cost of persons who are given refuge.
  Harrow council believes that the borough has the second largest elderly population in London. There is concern as to whether the SSA takes account of that fact. The cost of children in care seems to have escalated over the past few years, and Harrow's capital calculation is undoubtedly the lowest in London. That is historical, and due to the money spent previously.
  I am delighted at yesterday's announcement of the capital challenge pilot scheme, in which all local authorities will start from an even base. They will be able to bid depending on the merit of their schemes. I hope that the pilot scheme proves successful and that a larger proportion of capital will be allocated that way. If Harrow is able to make a strong and technically proficient bid, as I am sure it will, it should do well.
  My hon. Friend the Minister has offered a meeting at technical level between officials and representatives of the council, to determine the factual position in considering Harrow's SSA in coming years.
  People who rely on local government services and parents with children in schools should be clear about the message from the two main Opposition parties. That message is, "No more money." Opposition Members complain about Government funding and follow the rather disreputable advice that used to be given by the hon. Member for Blackburn (Mr. Straw) when he was Labour's campaigns organiser, which was to describe Government policies in such terms as to lead the public to believe what they thought would be Labour party policy. Labour Members have been indulging in that strategy tonight. When one gets through the mire and sees through the Opposition's criticisms, it is clear that there would be no extra money from Labour or the Liberals. Labour's insistence on scrapping compulsory competitive tendering is disgraceful, and a capitulation to the unions that control the Labour party.
  Even Sir Jeremy Beecham realises that substantial savings and improvements in the quality of services have been brought about by compulsory competitive tendering. It is a pity that it must be compulsory. Local government should have realised for itself the benefits that CCT could bring, but it did not and had to be compelled. Labour's irresponsible pledge to scrap CCT would increase bills, or reduce spending in other areas to compensate for the extra money that councils would have to spend on services taken back in-house.
  This thinly attended, low-key debate is testimony to the fact that Labour's thin arguments have been rumbled. Everybody knows that the Labour party is embarrassed by its record in local government, that it has no strategy, that it would not put any extra money into local government, and that, after this debate, it will crawl away and hope that people will forget everything that it has said.
  8.49 pm
  Mr. Austin Mitchell: I shall not follow what the hon. Member for Harrow, West (Mr. Hughes) said, but I admire his skill in making a little political padding go a long way. It was fascinating to watch him stretch his speech out—presumably in direct ratio to the unavailability of Conservative Members in the Chamber to defend the financial settlement.

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  The Secretary of State started us on the political track with a speech that was delivered with almost religious fervour. It was religious because so much that was blatantly political was put over in such a sanctimonious fashion. It was the performance of the Elmer Gantry of local government and I do not want to follow him down that road.
  The Government are clearly putting extra responsibility on local government, depriving it of the financial means to fulfil those responsibilities, and blaming Labour and Liberal local government for the inevitable increase in council tax—the Chief Secretary to the Treasury estimates that council taxes will rise by 8 per cent.—while presenting themselves as benignly and beneficently cutting direct taxation. That is the tactic: it is as clear as day follows night.
  I want to talk about the fate of my authority and of the new unitary authorities, which are a unique and very important feature of local government. We shall be embarking on a brave new adventure come April, to which the Government are committed. Indeed, their reform of local government has created the new unitary authorities. We in Grimsby and Cleethorpes—now North-East Lincolnshire—support that reform. We wanted to control our own destiny and we wanted a local government that was close to the people, so we want the new authority to succeed. I hope that the Government also want it to succeed.
  The local government experiment—the brave new world of 13 new unitary authorities which come into being on 1 April—cannot succeed in a welter of redundancies, cuts, debts, recrimination and blame, which the financial settlement has prepared for it. The new authorities are a special case, and need to be treated as such.
  I would argue that Grimsby is a special case within the special case because most of the assets of the county of Humberside that are to be divided up are on the north bank. We are trying to find accommodation for 400 council employees and are in a particularly difficult position. On the north bank there is a surplus of offices, but on the south bank, and in Grimsby especially because we did not have the county facilities, there is a dearth of offices.
  I do not want to recriminate and attack Humberside. Indeed, I have come to praise it as well as—in effect—to bury it. Humberside did a good job, especially on education and social services, where spending and standards were very efficiently maintained, as befits an area with severe social problems and a high level of unemployment. It fulfilled its responsibility. We also have a high level of single-parent families and Humberside gave them a good service.
  It is realistic to say, however, that Humberside has left problems—usually problems which were not its fault, such as those in education. School buildings are deteriorating faster than they can be repaired and maintained. That is no investment in the future of our children and that lack will cause real problems.
  In the case of the Havelok school, which I visited recently, the county obtained a grant to remove places—and also asbestos—but the money for that was spent in other schools in other parts of the county. The problem remains, but we do not have the money and we cannot apply again. Such are the problems left in parts of the education provision.
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  My children went to the Hereford school in Grimsby. I liked them going there; it is the local comprehensive. One should live by one's principles on education matters. That is not at all hypocritical, unlike so many Conservative Members who talk about improvements in state education and send their own children to private schools and public schools out of the state system. The Hereford school, Grimsby is a nice title for a school because it sounds like it should be a public school, but it is a comprehensive.
  It is a shame to see the Hereford school nowadays. Some of the one-story buildings that were the house bases when my children were there are deteriorating because the roof is very heavy. The roof is cracking, pressing down on the window frames, which are distorting, and glass is breaking constantly. To support the roof, they have had to put in angle frames, which in turn are cracking. The school roof has needed repair for three years. An expenditure of £200,000 is necessary to make the house bases—still used as kitchens—safe. An expenditure of about £1 million is needed to make the whole school livable in, workable and up to standard, but the money is not available. We have inherited such problems as a new authority, yet it is not our fault. We have not created them, but we have to deal with them.
  The other problem that has been left, which is unique to the new unitary authorities, is the lack of balances. Grimsby and Cleethorpes between them have managed to hand on balances of about £1 million, but a local authority needs balances of about £4 million or £5 million if it is to have the necessary flexibility to run things efficiently and manage over time.
  The new unitary authorities cannot control their own destiny like an on-going authority because they cannot manage their finances to ensure the maintenance of balances. We have not inherited any balances. Indeed, the balances might be negative because of the verdict on a lawsuit over school meals, which will impose costs on the successor authorities. We could not control that and it is not of our making, so it should be allowed for in the new authorities' financial allocations.
  The result is close to disaster. We are inheriting extremely difficult, if not disastrous, circumstances. If North-East Lincolnshire—the merger of Grimsby and Cleethorpes—is to come under the cap limit of £129.7 million, initial calculations mean cuts of £5.9 million in the existing level of services. In other words, there will be a 4.5 per cent. cut in the budget. And that is without allowing for any working balances. That possible £5.9 million overspend is less than recent, more detailed calculations indicate. Allowing for such things as landfill tax, employer's superannuation contributions and other new burdens, the overspend above the capping limit will be £9.8 million.
  It is impossible for an authority to take over responsibilities for the first time in April, welcome the new experiment, make it work and make it acceptable to people on the back of cuts of £9.8 million in spending and services. How can it be done? If the Government expect us to do that, they are being unrealistic. This is the Government's reorganisation. We wanted it, but we are partners in trying to make it work. If one partner is to be handicapped by a requirement to impose cuts of £9.8 million—in a new situation for which it is not responsible but which it has inherited—the burden will be too heavy to bear.

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  What are we to do? Staffing accounts for 60 per cent. of total spending. In a budget of, say, £140 million, social services and education accounts for some £100 million. Are we to have massive cuts and redundancies? If we are to achieve such massive cuts, the number of redundancies will be substantial. The local authority has not talked to the unions yet, but redundancies will have to be made as sure as day follows night, and not in tens or twenties but in hundreds. How can a new authority start by handing out redundancy notices to teachers, employees and others who provide services? How can a reputation and decent service be maintained in that situation? Why should the Government ask us to do that? It is just callous indifference to their own reorganisation. We would have to jettison services and make massive cuts in education. If school budgets are cut less, other aspects of service will have to be cut disproportionately, or we shall have to have redundancies. What a way to begin.
  When we ask for help and advice from the Government, we get various suggestions, none of them workable. We are told to involve private finance in local government activity, but that takes time; it cannot be introduced immediately. We are keen to work with local commerce and industry, but developing those relationships, particularly when it is a matter of industry investing money, cannot be done overnight.
  The Government tell us that the standard spending assessment has increased, but Humberside was spending over its SSA, so that is no benefit to us. We are told that we have a good deal from the single regeneration budget—we have indeed, and we are very grateful, but we deserved it because of the problems that we had to deal with as a result of the SRB grant; the local authority, which is on a tight, limited budget, has to put up a corresponding amount to secure that grant from the single regeneration budget. If we do not get the money, it is disastrous; if we do, it is increased spending.
  I know that the Minister takes our problems seriously, and he has taken time to consider the matter. I hope that he will re—examine it, because the situation is becoming desperate. The new unitary authorities must be treated as special cases. They are not a huge special case—there are 13 of them—but the extra financial help that they need will not be a huge burden. It will not create a gateway that all the other local authorities will use to make demands. The reorganisation is a joint effort by Government and the local authorities, and it must succeed. It will not succeed if the Government continue at the present rate.
  The Government have approached this reorganisation in far too mean a spirit. They think that they were too lax in the previous reorganisation, that money was pouring out of the dying local authorities, but it was nearly always for beneficial purposes. Indeed, the people of west Yorkshire are grateful for the West Yorkshire Playhouse, which was one of the beneficiaries of the previous reorganisation. Money was provided by the old west Yorkshire county council. It should be called the John Gunnell memorial theatre, because that was really the source of the finance. Benefits flowed from the previous reorganisation, but the Government feel that they were too generous then, and therefore they will counteract that by
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  being too mean this time. They want to show themselves to be tough. The result will be that new authorities will be strangled before they start.
  I ask the Minister to examine the issue again, because we are in a mess. The only way out is to raise the capping limits. If Grimsby had spent to the capping limit, there would not be a substantial increase in council tax. A special case was made last year for the inner London boroughs, so it can be made again for the new unitary authorities. If there is a case for capping limits, it is as a discipline on existing authorities, but a new authority cannot manage its finances in that fashion. The discipline is of no use if there are no balances to inherit. If an authority cannot manage to hit its capping limits this year and the next, capping limits are a form of strangulation, a garrotte, rather than a necessary discipline on local authority spending. Capping limits are totally unreasonable for new authorities.
  Another way out, as my hon. Friend the Member for Glanford and Scunthorpe (Mr. Morley) said, is to raise the SSAs for the new unitary authorities, because that brings in revenue support grant money. It is depressing to see the difference between the consultation SSAs for places such as Grimsby and the settlement SSA. Whereas Buckinghamshire—presumably the last Tory council—saw an improvement of 1.32 per cent., or £5 million, between the settlement SSA and the consultation SSA, we lost £500,000. We lost 0.3 per cent.—and we are a new authority that desperately needs the money. So I ask the Government to reconsider raising the SSAs for the new unitary authorities.
  Thirdly, I ask the Government to allow the new unitaries, especially that for north—east Lincolnshire, the authority in which I am passionately interested, to capitalise the overspend. There will be an overspend, so why not allow us to borrow to cover it?
  The Government say, and I am sure that they are right, that the reorganisation will bring financial benefits and economies to the areas concerned. They therefore want those areas to pay for it, on the grounds that they will inherit the benefits. Fair enough, but please allow us to pay for them over time, by allowing us an increase in our borrowing to finance the capital overspend. The costs will still fall on the area, and when we get the better times that will come from the greater economy and efficiency provided by the unitary authority, we shall be able to pay off the borrowing.
  To allow us to borrow and to capitalise now would avoid disaster. Disaster now would alienate the people from the new unitary authorities. They will not be interested in the performance in five years' time, or in greater efficiency a decade hence; we are talking about now. We are talking about how a public, many of whom, especially the teachers, have been reluctant to accept the reorganisation, can be brought to accept it.
  Fourthly, I ask the Government to give us an element of greater flexibility in the spending that is allowed for the costs of reorganisation, such as redundancies. Greater flexibility within the categories would be a small matter, but every little helps.
  I have tried to avoid the political knock-about that is almost implicit when the Government begin to try to pass the parcel of blame to local authorities by saying, "Labour increases your council tax, while we cut your income tax."

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  That is what is happening now, but I do not want to get involved in that argument today, because the situation in the new unitary authorities is too serious for that.
  The test is: will there be a seamless, efficient transfer that improves the quality of the service offered, and makes it more immediate to the people because they have a more direct say and are more involved with it? Given time, and the ability to make a seamless and graceful transition, that will happen. But we must have that ability and that freedom.
  At present the prospect, which must be seen in its full starkness, is of a transition accompanied by heavy redundancies—not in tens or twenties but possibly in hundreds—and by substantial cuts in services. We shall have to lop off entire functions, which we shall not be able to afford—industrial development, for example, which is vital to encourage jobs to an area of high unemployment, but which is financially vulnerable if we must have massive cuts. There will also have to be cuts in areas that I regard as sacred, such as education and social services.
  Do not force those cuts on us, Minister. I ask the Government not to sabotage their own creation, the local government reorganisation. Let it work. Help it in its hour of need. It would be awful to see it ruined by the alienation, rejection and hostility that would be caused by massive cuts and redundancies, followed by a long argument between the Government, local authorities and politicians in general about who is to blame—that most unseemly, undignified and unnecessary of political arguments.
  Something must be done: only the Government can do it—and they must do it soon.
  9.8 pm
  Mr. Clive Betts: Last year, the Government got themselves into an awful political mess over the settlement, because ultimately everyone—not only politicians at national and local level but governors, parents and schools throughout the country—believed that the Government were not giving schools a fair deal. People saw the prospect of cuts affecting their children's education, and they reacted and voted accordingly at the local elections.
  This year, the Government have from the outset tried to put a spin on the settlement, in an attempt to convince people that somehow, there is extra money for education. The Government tried to spell that out in a series of letters from Tory Members to schools in their constituencies. For local authorities that have education as a function, the education SSA has risen on average by 4.4 per cent., while the actual spending attached to that has risen by about 3 per cent. In total, the SSA for those authorities has risen by only 2.1 per cent., and the extra funding for the authorities has risen by 1.2 per cent.
  When the Chief Secretary to the Treasury came to the Treasury Select Committee, he was unable to explain how education authorities would be able to pay for the increase in inflation, the teacher's pay settlement that will be coming soon—which the Government expect the schools to find—and the thousands of extra school children in the next financial year with a funding increase of 3 per cent. Those sums do not add up to 3 per cent.—they add up to an awful lot more.
  Even if local authorities tried to spend all the extra money that the Government claim is available for education, they would then have to admit—as the Chief
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  Secretary admitted in the Select Committee—that there will be no extra funding for other important services. During this debate, it has become apparent that no Conservative Member regards any other service as important. Social services, housing, planning, libraries and environmental health are important services that need money, but the Government are not offering that money.
  Mr. Pickles: Would the hon. Gentleman, who has vast experience in local government, care to tell us by how much the settlement is inadequate? Is it £3 billion, or £4 billion? Will he set a figure on what local government needs?
  Mr. Betts: If Labour had been in power for the past 16 years, we would not have wasted money as the Government have done on schemes such as the poll tax. That money could have been applied properly to local services that would have benefited local people.
  The extra funding for my local authority, Sheffield, next year will be 0.8 per cent. That is a nonsensical figure, as can be seen when one looks at the needs of schools. The Tory argument is that funding should be given to the schools, and not to the central administration of education. Sheffield undertook an independent study of its schools, however, and they came back and said that they wanted no more delegation. Many of them realised—particularly the small primary schools—that having some services, such as psychological support services, funded centrally gave them better value for money.
  The reality is that even if the local authority directed every extra penny given to it to education, every one of the schools in my constituency next year will face a cut in funding and a cut in the services that they can provide. Conservative Members do not understand that, in the past few years—when circumstances have been slightly better—schools have been putting away a bit of money for a rainy day. In the past two years, that rainy day has come, and schools are now spending their reserves to keep teachers employed and to buy books and equipment for the children.
  Every one of the schools in my constituency is now saying that those reserves are coming to end and—in most cases—have done so already. They will not be replaced next year. Irrespective of what the local authority does, those schools will have a gap in their resources. There will be a cut in services because the reserves that they have will no longer be able to provide services to the children in the form of the employment of teachers, spending on books and equipment and repairs to schools. That is what headteachers and school governors are telling me and, frankly, I am prepared to believe what they say more than I believe the Government's assurances.
  On top of that, parents will see their council tax bills drop through the door next month. They must not blame Labour or Liberal Democrat authorities for what will happen. Buckinghamshire—one of the few Tory councils around—estimates that it will have a 9 per cent. increase in council tax. The Chief Secretary admitted that his estimate from the Government's own figures of the increase in council tax is 8 per cent. for the next financial year.
  As it is the Government's intention to switch the amounts of money funded locally to provide services from 21 per cent. of the total to 26 per cent. in the next three

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  years, there will be not only an 8 per cent. increase in council tax—on the Government's estimates—in the next financial year, but an 8 per cent. increase in each of the following two years. On the calculations and estimates used by the Chief Secretary, the total increase in council tax will be 25 per cent. cumulatively over a three-year period. Will the Minister answer whether that is the case? There will be a 25 per cent. increase in council tax in the three years, while people get poorer services. Thank goodness the Government will not be in power in the two subsequent years to carry that into effect.
  Ministers say that, whatever arguments may be advanced about the amount of money involved, the methodology is all right: it has all been agreed. I challenge that on three grounds. First, there is the issue of capital financing, which I mentioned earlier in an intervention. In a study requested by the Audit Commission, Price Waterhouse concluded that it was wrong to fund capital financing through SSAs and to make use of notional debt. It suggested a different method, involving adjustments to the credit approval levels given to local authorities in the past. Why do the Government not take up that suggestion, which was approved by the Audit Commission—a neutral body, looking objectively at ways of funding local authority services? Is it because some of the biggest gainers would be authorities such as Birmingham and Sheffield?
  Secondly, there is area cost adjustment. I welcome the study that is currently in progress. Ernst and Young has already carried out a study for the metropolitan authorities, which effectively demolished the area cost adjustment figures as they stand. An area cost adjustment should be precisely that: it should take into account the difference in the costs of different areas, and accordingly adjust the resources that councils receive from central Government. In fact, however, authorities that bear exactly the same costs receive different amounts of help.
  The Minister has commissioned a study, and I welcome that, but, like my hon. Friend the Member for Stoke—on—Trent, South (Mr. Stevenson), I am a little cynical. I fear that nothing will be done as a result of the survey if action would be inconvenient in terms of a general election. I hope that the Minister will assure us that that is not the case.
  Thirdly, there is the issue of the shared accommodation figures. They affect the social index, and, in turn, the allocation of money for adult services within the social services budget and for the "other services" block. They also affect funding for children's services. That is an anachronism. Shared accommodation is such a relatively small part of total accommodation that it no longer provides an accurate measure of deprivation in communities. It is not surprising that Westminster ranks so high in the Government's deprivation league tables, given that they are using a measure that has been discredited by every objective observer of their method of calculating SSAs.
  My local authority contains two nonsensical features. First, there is the question of Supertram. I support the scheme: I think it important for us to encourage and develop light railway systems, which are environmentally friendly and give people an incentive to use public transport and leave their cars at home. I welcome the funds that the Government have provided. Nevertheless,
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  it strikes me as stupid for the Government to fund Supertram partly through the local authority revenue support grant, in such a way that—although it costs the authority nothing—that spending displaces other spending within the capping limits.
  I have to explain to constituents not that their council tax is rising because of the Supertram capital expenditure, but that it will fall for that reason because less money can be spent on education, social services and other important matters. That has always been a reason for grievance, not only in Sheffield but in Rotherham, Doncaster and Barnsley, whose services are being cut although they do not benefit from the tram.
  Secondly, the Government calculate the highways SSA on the basis of the number of vehicles that travel down particular roads. Absurdly, they have worked out Sheffield's SSA, and its grant, on the basis of censuses relating to vehicle movements on roads that were dug up so that Supertram could be built. No vehicles could go down those roads. The Government have accepted that that is the case, but they will not accept that Sheffield has lost £900,000 a year—which affects all our services—as a result of that ridiculous way of calculating the highways SSA. Other roads should have been used in the calculation. Sheffield has been particularly badly affected because of the disruption caused by the Supertram works.
  Finally, we must also consider the nonsensical way in which fire authorities are funded. It is ridiculous that such authorities can be given a lower capping figure than that required by the chief fire officer to deliver the standard of service required by Home Office regulations. That is a classic case of two Government Departments, each not knowing what the other is doing.
  Last year, the Government had to raise the capping level for the fire authority in South Yorkshire because the Home Office accepted the chief fire officer's recommendation that he could not provide a legal fire service within that level. Yet, this year, a fire station in the village of Mosborough in my constituency—one of the largest housing developments in the Sheffield area—will be shut down. That is wrong, and the Minister ought to do something about it.
  The settlement does not give any extra resources for education and will mean cuts across the board, not merely in education but in other important services. It will mean large council tax increases of around 8 per cent., according to the Government's own estimates. The grant is not distributed fairly and, in the case of my city, there are clear nonsenses, which I hope that the Minister will consider. Ultimately, if he has no sympathy for the people of Sheffield or for my constituents, he might at least have some for the four remaining Tory councillors on Sheffield city council, who will almost certainly lose their seats at the local elections in May.
  9.20 pm
  Ms Hilary Armstrong: We have had an interesting debate. It has certainly shown the difference between the two sides of the House. It was interesting that almost all the Conservative Members who contributed supported the Government's general case, but went on to plead special cases for their authorities and pointed to some unfairness in the way in which they were being treated. That hints at a slight problem for the Government, who are pleading with all the charm, or otherwise, that they have, that everything is fair and a watertight methodology is being used.

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  The right hon. Member for Selby (Mr. Alison) made a particular plea and I hope that the Minister will be able to deliver the commitments that he gave to his authority because the problems caused by reorganisation there are problems that we want to be acknowledged. We want the Government to live up to those commitments.
  We have been discussing a financial settlement that expresses the relationship between central and local government. An effective democracy depends on alternative and competing sources of power, yet the Government have centralised power and enfeebled local government in ways that many people believed would never happen in this country. It is small wonder that many councillors feel that they have become little more than an administrative outpost of central Government.
  Time and again, hon. Members have said that the people have given their verdict. Much as Conservative Members complain about who is running councils, it is not the Opposition but the electorate who control that. They will be somewhat bemused that their wishes are so trounced by Tory Members.
  Local government has the potential for being the engine of regeneration. It is local government, rather than central, that has a clear awareness of the needs, desires and aspirations of the local community. Local government is best placed to respond flexibly to changing circumstances in the locality. Local government, rather than central Government, works closely locally on a day-to-day basis with other public agencies, such as health authorities, but also with business and community groups.
  The way in which some Conservative Members talk about relationships between business and local government shows that they do not know what has been happening. Extremely effective partnerships between Labour local government and business have been forged up and down the country. In Consett in my constituency, they are central to the town's recovery from the closure of the steelworks. The Government fail to understand the benefits to society from the development of a proper working relationship with local government.
  One commentator, the former editor of The Times, Simon Jenkins, has said:
  "the Conservatives have concentrated power on the central institution of Downing Street as never before in peacetime…The Tory state is now the most centralised in the western world."
  He now works for the Evening Standard. Neither The Times nor the Evening Standard is famed for its support of the Labour party, but we welcome his judgment.
  Local government is now exceptionally reliant on central Government for its funding. That is why we have these debates. What can be spent in the localities is, in almost all aspects, determined by central Government. Therefore, it is to central Government that we must bring our complaints and concerns. That is no accident. It is not the result of things happening without anyone knowing but of deliberate decisions to disempower local government.
  According to the Prime Minister's former trusted adviser, Sarah Hogg, Ministers and Margaret Thatcher were exasperated with local government in the late 1980s. She said that that was continued in 1990 and that
  "More and more Tory MPs thought that the logical solution was for central government to take over completely".
  We have heard some of those Tory Members today.
  The Parliamentary Under-Secretary of State for the Environment (Sir Paul Beresford): What about Anthony Crosland? He was sick of it too.
  Ms Armstrong: Does the hon. Gentleman want to intervene?
  Sir Paul Beresford indicated dissent.
  Ms Armstrong: The revenue support grant settlement this year gives councillors little ability to makes decisions that respond effectively to the needs and desires of their local communities. Instead, councillors, Labour, Liberal and even the odd rare specimen of a Tory, are placed in a straitjacket by central Government.
  This month's Treasury Select Committee report—I congratulate my hon. Friend the Member for Sheffield, Attercliffe (Mr. Betts) on his contribution on this—states that to fund an increase in the areas that the Government have recommended, including education,
  "Local authorities are either going to have to make efficiency savings of a level which may be unobtainable in the short, or even long term or substantial cuts in other sectors of their budgets or they will have to find additional revenue from other sources, predominantly the council tax."
  Most local politicians do not have the choice of whether to cut services or hike up the council tax. As my hon. Friend the Member for Barnsley, West and Penistone (Mr. Clapham) said, too many councils are being forced both to cut services and raise the council tax as much as they can. Again, local communities will pay more tax and get less services.
  Local government and local communities are having to pay the price of central Government economic incompetence and waste. Central Government still take no responsibility for that. They have not even bothered to apologise for the £4 billion poll tax fiasco. Indeed, they are now set on an another significant administrative waste in the shape of their dogmatic, ideological determination to introduce nursery vouchers.
  The Government have not even followed the Environment Select Committee recommendation made in October 1995 that the Department of the Environment should attempt to quantify alleged efficiency savings possible in local government. It said that the Department
  "is certainly mistaken to imply that all that is required is to offset inflation through efficiency savings".
  The Committee recommended that the
  "Department makes some realistic attempt to quantify the alleged efficiency savings as propounded by the Audit Commission."
  We have been urging the Government to do that for some time, but they singularly refuse to take it on board.
  Several hon. Members have questioned the logic of the SSAs, notably my hon. Friend the Member for North-East Derbyshire, who gave a detailed critique of how the SSA affects his constituency and North East Derbyshire district council.
  The Secretary of State claimed that he had always considered me a fair-minded woman. I try to be, but that is why I find the inequities in the current funding system objectionable. Neither I nor my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) is alone in

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  objecting to the methodology used in the current funding system. No reasonable person could believe that a system that is meant truly to reflect economic and social need could place Westminster city council fourth in the league table of deprivation.
  The Minister and I have had some correspondence about that matter. He may have noticed a recent article by the former local government correspondent of The Daily Telegraph, John Grigsby—again someone not noted for his support for the Labour party.
  Mr. Curry: He has said some nice things about me.
  Ms Armstrong: He has said some good things about the Minister, but not about the system. His article states that
  "it is the government which has created the unsatisfactory grant regime … Unfortunately for the government's argument, its indices are not the only criteria of deprivation Bristol university supplies. Turn the page"
  he suggests to the Minister—
  "and there is another list which takes into account economic factors like adult and youth unemployment and single parents. Here, Westminster comes in as the 96th most deprived council. And the second edition of the same publication quotes the environment department's own index of local conditions independently produced for application to local authorities, which rank Westminster as only 25th most deprived."
  No Labour Member is naive about the difficulties of ensuring a fair system. As John Grigsby goes on the say, however:
  "The Westminster does matter because it is so illogical."
  He says that what is of
  "fundamental importance is that justice should not only be done, but should manifestly and undoubtedly be seen to be done."
  Clearly, justice is not being seen to be done.
  Mr. Gummer: Will the hon. Lady simply explain to me why Westminster council did better under a Labour Government than under a Conservative Government if the system is unfair? If she says it is unfair, it was more unfair when Jack Straw drew up the rules.
  Mr. Deputy Speaker (Sir Geoffrey Lofthouse): Order.
  Mr. Gummer: I apologise. I should have said the hon. Member for Blackburn (Mr. Straw).
  Ms Armstrong: I am tempted by the right hon. Gentleman's intervention. He has sought to intervene a number of times to lambast Labour Members. At least he resisted this time and did not try to abuse people. That his normal method of intervention is to abuse people says more about him than it says about us. My hon. Friend the Member for Blackburn (Mr. Straw) did not devise the system. My father was the Minister at the time and he certainly did not have my hon. Friend as an adviser. The Secretary of State forgets that I have a little knowledge of what was going on in the last Labour Government. He tries to use figures in his normal way: to confuse rather than elucidate. The figures that I have given are clear. They resulted, as he knows, in rates being levied in Westminster that were nothing compared with the council
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  tax being levied today. There are anomalies. The Government know that, and they should do something about them.
  Under the Government's "pay more, get less" policy, council tax payers will have to fork out more for the privilege of receiving fewer services. Council tax payers will have to pay the price of Tory economic incompetence. The gap is widening between what the Government acknowledge that councils should spend and the funding that local authorities receive from central Government. The Tories expect council tax payers to fill the gap.
  The Secretary of State might try to con us by claiming that the Government are motivated by a desire to enable local government to raise a greater proportion of its funding, but the Minister said this afternoon—and it has been confirmed throughout the debate—that that is not their intention. Their intention is to hide another tax hike—this time, by trying to hide behind the coat-tails of Labour local government.
  The Government have failed to take into account the fact that experience has taught the electorate to trust the word and explanation of local councils in preference to the statements of Tory Ministers.
  The Government's original figures, produced at the time of the Budget statement, show that the Government expected council tax payers to fork out a 5.2 per cent. council tax increase next year and an extra £3.5 billion in the next three years—the equivalent of nearly 2p in the standard rate of income tax. The final tax hike is likely to be considerably greater, however, and hon. Members have mentioned the words of the Chief Secretary to the Treasury Select Committee.
  The Government claim that they are generously giving new money for education. The figure that is floated by Ministers is the supposedly generous 4.4 per cent. increase in the education SSA. It is not only the British people who are more intelligent and sophisticated than to believe the Government—not even their colleagues believe them.
  Mr. Pickles: Will the hon. Lady give way?
  Ms Armstrong: No; I will not give way.
  Let us consider the facts clearly and objectively. Education authorities will receive an increase in central Government grant of exactly 1.2 per cent. in the year ahead. When Conservative Members speak about money, they need to speak about the actual money—1.2 per cent. The increase in SSAs is 4.4 per cent.
  Mr. Pickles: How wide is the gap? How much extra would Labour give?
  Ms Armstrong: I will not answer questions about how much we shall give until the Government deal with their waste. They should deal with the waste, and then ask us questions about what we shall spend. We know that the Conservatives would not tell us the truth before the most recent general election so, if we try to say anything now, we shall have to change it once we see their cooked books.
  It is an illusion that there is more money for education throughout Britain. Parents know that there is not, teachers know that there is not and the Tories know that there is not. That is why the Tories have been blustering and bluffing during the debate.
  Mr. Tipping: Will my hon. Friend give way on that point?
  Ms Armstrong: I am happy to give way to my hon. Friend.
  Mr. Tipping: I was interested to hear my hon. Friend mention blustering. I wonder what she makes of the fact that, in Nottinghamshire, the Chancellor of the Exchequer has been saying that there is extra money for education in Nottinghamshire. The local authority in Nottinghamshire has spent all the extra money in schools, yet next year, in the Chancellor's constituency of Rushcliffe, teachers' jobs will be lost, and £6.3 million of repairs remain to be done at schools. Is he being economical with the truth?
  Ms Armstrong: My hon. Friend the Member for Sherwood (Mr. Tipping) will know that if Nottinghamshire received what Westminster receives it would be able to provide an extra 4,000 teachers.
  Mr. Pickles: Will the hon. Lady give way?
  Ms Armstrong: The Chancellor of the Exchequer might then be able to uphold some of his promises. As usual—
  Mr. Pickles: Give way.
  Mr. Deputy Speaker: Order. From where I am sitting, it seems obvious that the hon. Lady is not giving way.
  Ms Armstrong: The Chancellor of the Exchequer, like other Ministers, is saying one thing and doing another. The Government have made commitments on tax which they have not kept. They are not very good at telling the truth about it either, as we saw from Prime Minister's questions yesterday.
  This is a pay more, get less settlement. Council tax payers and service users will pay the price of the Government's economic incompetence and waste. Councillors are being placed in an impossible position. They must either cut essential services such as school services, meals on wheels and home helps or they must set the council tax at a level which they know that local people can ill afford. Some councils have to do both. That is not what local democracy should be about.
  The Government have made it impossible for local people to determine the level of services or what should be paid for them. Of course, local democracy is not the Government's overriding priority. Their obsession is to stay in power and run the economy into the ground. How can they otherwise afford the income tax cuts that they are looking for?
  I believe that the electorate will not be fooled. When they see services cut, they will know that the Government are to blame. When they see their council tax rise, they will blame the Government. That blame will be clearly expressed in the local elections in May and in the general election. I know that people want that election because they are sick of paying the price of Tory obsessions, dogma and mistakes. Instead of the people of this country paying the price, we look forward to the Tory Government paying the price.
  9.41 pm
  The Minister for Local Government, Housing and Urban Regeneration (Mr. David Curry): It is not often that, in a debate on local government finance, one can begin with Procrustes, but as my right hon. Friend the Member for Selby (Mr. Alison) introduced him, I have taken some affection for him and done my research. He apparently lay in wait on the Athens road and equipped people who came for lodgings with a bed that was not necessarily the right size. If the people were too long, he chopped them. I did not realise that capping had such a distinguished antecedent, but I am encouraged to know that I follow in such a long tradition. I understand that Theseus fastened Procrustes to his own bed and chopped his head off—he had clearly missed his vocation as a local government Minister.
  When the hon. Member for North-West Durham (Ms Armstrong) forgot her speech, she said some sensible things. I agree with one thing that she said; that local government should be the engine of local regeneration. I am grateful for that endorsement of our policies. A Labour Government did not introduce city challenge, from which areas such as Sheffield have benefited. A Labour Government did not introduce the single regeneration budget, from which many Labour-held areas have benefited. A Conservative Government brought local authorities and the private sector into play to promote creative regeneration activities in their areas.
  I spent this morning in Dudley seeing regeneration by a Conservative Government in practice. What is happening there demonstrates what can be done by local government if it breaks out of the mind-set in which the Labour party would leave it. We want to develop that concept, so I look forward to the endorsement and support of the hon. Member for North-West Durham for the principle of capital challenge. It works on exactly the same principle as asking local authorities to define their priorities and work in partnership to deliver them. I am delighted that the Labour party, belatedly, has woken up to the creative activities of the Government.
  I fear that my text for the day has to be based on the hon. Member for Holborn and St. Pancras (Mr. Dobson). I should like to quote him. He may not live to acquire the fame of Procrustes, but his fame will last at least until the election. The hon. Gentleman said, "I don't endorse anybody else's numbers except my own and you're not getting those out of me.". It is not quite the Book of Revelations, but at least we now have "Dobson's dictum" which appears to be: hear all, see all and let nowt out. Does the Labour party intend to go to the next election without revealing what it will spend? Will Labour Members simply say, "We condemn your settlement and our local authorities say that it is £3 billion short"?
  Every Labour Member who spoke in the debate said that he or she wanted more money for education, community care, social services and so on, but the Opposition will not add up the cost—and that is what matters. If they claim that expenditure is inadequate, they must know by how much it is inadequate. The Labour party cannot be a lobby organisation: it is supposed to be an Opposition, yet Labour Members simply say what they do not like and refuse to put a figure on the cost of what they want.
  The money must come from somewhere, and it can come from only one place—the taxpayer. It can come from more Government grants of taxpayers' money, or

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  more money can be collected from the taxpayer locally. There is no other way of doing it. The hon. Member for Holborn and St. Pancras must tell us how much money the Labour party would spend and where it would come from, otherwise it is simply mystery money and phantom finance. Opposition Members are afraid to say a word to anyone in case we start to add up the sums for ourselves.
  Ms Armstrong: Will the Minister tell us who paid for the £4 billion that was wasted on the poll tax?
  Mr. Curry: Why will the hon. Lady not answer one simple question? Everyone who intends to vote at the next election wants to know how much it will cost. Labour Members exhibit an unusual degree of Trappism when it comes to finance: they will not say a word. [Interruption.] The Opposition housing spokesman, the hon. Member for Greenwich (Mr. Raynsford), is guilty also. He has said that he will release capital receipts, but he will not say how many or for how long. It is all shrouded in mystery. We have only gesture politics; none of the arithmetic has been done. At least we know what the Liberal Democrats stand for—sort of.
  Mr. Coe: Oh no, we do not.
  Mr. Curry: I did say "sort of". I shall give a few examples, but they may not add up to the total picture. The Liberal Democrats would lift the cap completely and remove all safeguards. At least the Opposition would retain some safeguards, with the Audit Commission assuming the curious role of the US cavalry that would gallop over the hill if it thought that people were transgressing. The Liberals offer no such safeguard.
  Mr. Dobson: Is the Minister saying that he cannot see the sense in our proposition? We believe that the Audit Commission should set a timetable for improvement and, if councils do not meet that timetable, the Secretary of State could act. Does the Minister think that scandals such as that in Lambeth should be allowed to continue for decades, as occurred under the existing law?
  Mr. Gary Streeter: It is Labour-controlled.
  Mr. Dobson: Yes, Labour-controlled Lambeth was a disgrace. Something should have been done, but the Government did nothing for a decade. That is why we want to change the law.
  Mr. Curry: There is no point the hon. Gentleman saying that he will do this, that and the other if he will not answer the biggest question: how much money will the Labour party spend? What will it cost? The hon. Gentleman talks about sending in the Audit Commission when councils have overspent or underspent. Such a role would take the Audit Commission into completely new territory. I think that we all agree that it is currently playing a useful role setting out objective indicators to assist local government in managing its affairs.
  We agree that some councils should be reformed. Where wrong has been done, we condemn it—irrespective of where it occurs—once it has been proved. However, I
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  do not believe that we should send in the Audit Commission to do any old job; it should stick to its present role.
  Ms Armstrong: Will the Minister give way?
  Mr. Curry: I shall give way to the hon. Lady in a moment. She should concentrate on answering the question: how much will a Labour Government cost us? How much would a Labour Government cost the taxpayer, centrally and locally? What is the right amount for the settlement? The hon. Lady can illustrate her point by referring to the current settlement.
  Ms Armstrong: If the Government had taken action against councils that were defrauding their council tax payers, the country would be in a better state and there would be more money for the settlement. For a kick-off, the Minister could have recovered the £29 million from Westminster. [Interruption.]
  Mr. Deputy Speaker: Order. These interventions are very long. The House must settle down. The Minister has a right to reply to the debate. The hon. Member for North-West Durham (Ms Armstrong) was given a reasonable hearing and the Minister must be given the same courtesy.
  Mr. Curry: Let me focus on the arguments.
  Mr. Betts: That will make a change.
  Mr. Curry: Well, the argument is about how much the Labour party thinks it is right to spend on the settlement. I have asked that question a dozen times, but I receive no answer. If the Labour party was to form a Government, all local authorities would parade to its office and ask for more money. They want to know whether they would receive it, but the hon. Member for Holborn and St. Pancras will not give them—or the taxpayer—a clue. It is the most important question in politics.
  Mr. JesselIs my hon. Friend aware that the former Labour-controlled Greater London council set up a 30-year contract to transport waste and that that contract still has 21 years to go? The cost now falls on my constituents and others in six boroughs in west London. It amounts to several million pounds a year, which is completely inequitable. Will my hon. Friend look to see whether anything can be done to undo the damage done by the Labour-controlled Greater London council?
  Mr. Curry: My hon. Friend is referring to the landfill tax. It is true that some local authorities are locked into long-term contracts that were signed some time ago. They have known the intentions behind the tax for more than a year and I draw my hon. Friend's attention to the fact that, last year, local authorities received £26 million for waste regulation. The responsibility goes to the Environment Agency, but the resources stay with local government and there will be some offsetting national insurance contributions. I promise my hon. Friend that, during the deliberations which must follow the vote tonight, I will pay attention to that issue.

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  It would be helpful to mention the work on the SSAs that must be done over the next year, because that is important to local authorities. The SSAs must change and develop. Nobody thinks that this is a rigid system that is carved in granite. We make changes and review every year on a rolling programme. People know that that is the case. All the work is shared with the local authority associations and none is done privately.
  It is true that interests are not the same. We hear that most obviously in the arguments about the area cost adjustment. Some local authorities have a strong commitment to it, but some think that it is pernicious. There are representatives of each view on both sides of the House. The idea that there is some absolute truth is nonsense. We have to find a system that works well and which people accept as being objective. They must also be able to accept that if they make sensible representations and make a good case, we will try to take it on board.
  Our first priority this year is the area cost adjustment review. I do not know what the outcome will be. I have said before that it will have to be intellectually robust and demonstrate a need to spend. If that is the case, we will incorporate it. We are aiming to have the results by June so that they are available for next year's settlement. I hope that local authorities will agree on it, but that is perhaps somewhat optimistic. It is important to be satisfied that it is the best possible intellectual basis for allocating money.
  The second area of investigation, which is also important, is the sparsity factor. Here again, many rural areas are concerned about the cost of supplying services in wide open spaces. [Interruption.]
  Mr. Deputy Speaker: Order. The House must settle down and give the Minister a reasonable hearing. That applies to both sides of the House. There has been chattering on both sides of the Chamber while the Minister has been trying to answer the debate.
  Mr. Curry: There are equally pressing concerns among urban authorities where the population lives in crowded conditions and where there are problems of health, for example—the Webber-Craig authorities. They are concerned to see the SSA formula adjusted to take account of those problems. The sparsity work is scheduled to be completed in time for next year's settlement.
  The children's element of personal social services has a completion date of July. It will have an important effect, especially for some urban authorities. The elderly element is also subject to review. Those are the principal elements of work this year. I do not know what will happen—some may neutralise each other or they may push in the same direction. We will incorporate data where they are demonstrably the most effective and up to date available. We do not want local authorities to fall over the edge of the cliff, so we must not give them too difficult a task on adjustment.
  Hon. Members will be pleased to learn that authorities that have to deal with the problems of unaccompanied refugee children will receive a grant in the coming financial year. The Department of Health will consult on the means to distribute that.
  The hon. Member for Great Grimsby (Mr. Mitchell) and I have had many exchanges across the Chamber on different matters, but I share his desire that the new unitary authorities should get off to a good start.
  Mr. Morley: Which ones?
  Mr. Curry: All of them. Everybody understands that they cannot inherit all the spending patterns of their predecessors. As the hon. Gentleman knows, Humberside has a difficult legacy. I am anxious for the process to work and I shall listen to representations from the new unitary authorities that have a particularly difficult legacy. Of course, one or two of them may get a legacy that they had not expected. Apparently there is an Aladdin's cave in Avon, which had not been anticipated.
  I understand the concerns expressed about the fire service. We have taken into account pensions, fire safety and fire prevention. It is a difficult area and it is not easy to find an effective formula. The associations are keen on a particular approach based on fire stations. I have said that I am willing to consider it. Some circularity is involved because it reflects existing spending patterns. Also, certain high costs could fall on metropolitan areas. However, if those problems can be resolved, I am willing to consider objectively whether the formula can be improved.
  All these matters are of considerable importance. Many of my hon. Friends raised questions of detail, to which I cannot reply tonight in the short time available. I shall write to them and deal fully with the points that they raised. My hon. Friends the Members for Falmouth and Camborne (Mr. Coe) and for Horsham (Sir P. Hordern) referred to problems in their county areas and difficulties in their district areas.
  I understand that the account given by the hon. Member for North-East Derbyshire (Mr. Barnes) was meticulous. I look forward to examining it in the detail it merits.
  What happens now is that the preceptors must set their budgets by 1 March and the billing authorities must do so by 11 March. Capping decisions will be taken at the beginning of April and authorities have four weeks in which to decide whether to accept them. If they do, the process ends. If they do not, they have to challenge the cap by the beginning of May. Meetings with Ministers will take place and we will consider the arguments. As I have shown in recent years, where a good case is made, it receives thorough attention. We expect to issue the final caps in late May. That is a traditional timetable and I am sure that local authorities will, as always, avail themselves of the process.
  I want to return to the problem that I highlighted at the beginning of my speech—that we do not know where the Opposition stand on these matters. We know that they want to end compulsory competitive tendering and to hand power back to some of the public sector trade unions. We know that they want to end capping, which would impose extra costs on the council tax payer. We know that they want to put business back in the clutches of local authorities by repatriating the business tax, but there would have to be a redistribution mechanism for that. The Opposition say that they will do something about capital receipts, but they do not say what.
  The biggest question is: how much would the Opposition spend? That is true of Labour and of the Liberal Democrats. The elector is caught between a rock and a soft touch. I am afraid that the best recourse for them is to support us in voting for this measure.
  Question put:—
  The House divided:Ayes 300, Noes 264

  Division No 42]

  [10.00 pm

  AYES

  Ainsworth, Peter (East Surrey)

  Dicks, Terry

  Aitken, Rt Hon Jonathan

  Dorrell, Rt Hon Stephen

  Alexander, Richard

  Douglas-Hamilton, Lord James

  Alison, Rt Hon Michael (Selby)

  Dover, Den

  Allason, Rupert (Torbay)

  Duncan, Alan

  Amess, David

  Duncan-Smith, Iain

  Ancram, Michael

  Dunn, Bob

  Arbuthnot, James

  Durant, Sir Anthony

  Arnold, Jacques (Gravesham)

  Dykes, Hugh

  Ashby, David

  Elletson, Harold

  Atkins, Rt Hon Robert

  Emery, Rt Hon Sir Peter

  Atkinson, David (Bour'mouth E)

  Evans, David (Welwyn Hatfield)

  Atkinson, Peter (Hexham)

  Evans, Jonathan (Brecon)

  Baker, Nicholas (North Dorset)

  Evans, Nigel (Ribble Valley)

  Baldry, Tony

  Evans, Roger (Monmouth)

  Banks, Matthew (Southport)

  Evennett, David

  Banks, Robert (Harrogate)

  Faber, David

  Bates, Michael

  Fabricant, Michael

  Batiste, Spencer

  Fenner, Dame Peggy

  Bellingham, Henry

  Field, Barry (Isle of Wight)

  Bendall, Vivian

  Fishburn, Dudley

  Beresford, Sir Paul

  Forman, Nigel

  Body, Sir Richard

  Forsyth, Rt Hon Michael (Stirling)

  Bonsor, Sir Nicholas

  Forth, Eric

  Booth, Hartley

  Fowler, Rt Hon Sir Norman

  Boswell, Tim

  Fox, Dr Liam (Woodspring)

  Bowden, Sir Andrew

  Fox, Sir Marcus (Shipley)

  Bowis, John

  Freeman, Rt Hon Roger

  Boyson, Rt Hon Sir Rhodes

  French, Douglas

  Brandreth, Gyles

  Gallie, Phil

  Brazier, Julian

  Gardiner, Sir George

  Bright, Sir Graham

  Garnier, Edward

  Brooke, Rt Hon Peter

  Gillan, Cheryl

  Brown, M (Brigg & Cl'thorpes)

  Goodlad, Rt Hon Alastair

  Browning, Mrs Angela

  Goodson-Wickes, Dr Charles

  Bruce, Ian (Dorset)

  Gorman, Mrs Teresa

  Burns, Simon

  Gorst, Sir John

  Burt, Alistair

  Grant, Sir A (SW Cambs)

  Butcher, John

  Greenway, Harry (Ealing N)

  Butler, Peter

  Greenway, John (Ryedale)

  Butterfill, John

  Griffiths, Peter (Portsmouth, N)

  Carlisle, John (Luton North)

  Grylls, Sir Michael

  Carlisle, Sir Kenneth (Lincoln)

  Gummer, Rt Hon John Selwyn

  Carrington, Matthew

  Hague, Rt Hon William

  Carttiss, Michael

  Hamilton, Rt Hon Sir Archibald

  Cash, William

  Hamilton, Neil (Tatton)

  Channon, Rt Hon Paul

  Hampson, Dr Keith

  Chapman, Sir Sydney

  Hanley, Rt Hon Jeremy

  Churchill, Mr

  Hannam, Sir John

  Clappison, James

  Hargreaves, Andrew

  Clark, Dr Michael (Rochford)

  Harris, David

  Clarke, Rt Hon Kenneth (Ru'clif)

  Haselhurst, Sir Alan

  Clifton-Brown, Geoffrey

  Hawkins, Nick

  Coe, Sebastian

  Hawksley, Warren

  Congdon, David

  Hayes, Jerry

  Conway, Derek

  Heald, Oliver

  Coombs, Anthony (Wyre For'st)

  Heathcoat-Amory, David

  Coombs, Simon (Swindon)

  Hendry, Charles

  Cope, Rt Hon Sir John

  Heseltine, Rt Hon Michael

  Cormack, Sir Patrick

  Hicks, Robert

  Couchman, James

  Higgins, Rt Hon Sir Terence

  Cran, James

  Hill, James (Southampton Test)

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

  Hogg, Rt Hon Douglas (G'tham)

  Curry, David (Skipton & Ripon)

  Horam, John

  Davies, Quentin (Stamford)

  Hordem, Rt Hon Sir Peter

  Davis, David (Boothferry)

  Howard, Rt Hon Michael

  Day, Stephen

  Howell, Rt Hon David (G'dford)

  Deva, Nirj Joseph

  Howell, Sir Ralph (N Norfolk)

  Devlin, Tim

  Hughes, Robert G (Harrow W)

  1096

  Hunt, Rt Hon David (Wirral W)

  Powell, William (Corby)

  Hunt, Sir John (Ravensbourne)

  Rathbone, Tim

  Hunter, Andrew

  Redwood, Rt Hon John

  Hurd, Rt Hon Douglas

  Renton, Rt Hon Tim

  Jack, Michael

  Richards, Rod

  Jackson, Robert (Wantage)

  Riddick, Graham

  Jenkin, Bernard

  Rifkind, Rt Hon Malcolm

  Jessel, Toby

  Robathan, Andrew

  Jones, Robert B (W Hertfdshr)

  Roberts, Rt Hon Sir Wyn

  Key, Robert

  Robertson, Raymond (Ab'd'n S)

  King, Rt Hon Tom

  Robinson, Mark (Somerton)

  Kirkhope, Timothy

  Roe, Mrs Marion (Broxbourne)

  Knight, Mrs Angela (Erewash)

  Rowe, Andrew (Mid Kent)

  Knight, Rt Hon Greg (Derby N)

  Rumbold, Rt Hon Dame Angela

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

  Ryder, Rt Hon Richard

  Knox, Sir David

  Sackville, Tom

  Kynoch, George (Kincardine)

  Sainsbury, Rt Hon Sir Timothy

  Lait, Mrs Jacqui

  Scott, Rt Hon Sir Nicholas

  Lamont, Rt Hon Norman

  Shaw, David (Dover)

  Lang, Rt Hon Ian

  Shaw, Sir Giles (Pudsey)

  Lawrence, Sir Ivan

  Shepherd, Rt Hon Gillian

  Legg, Barry

  Shepherd, Sir Colin (Hereford)

  Leigh, Edward

  Shepherd, Richard (Aldridge)

  Lennox-Boyd, Sir Mark

  Shersby, Sir Michael

  Lester, Sir James (Broxtowe)

  Sims, Roger

  Lidington, David

  Skeet, Sir Trevor

  Lilley, Rt Hon Peter

  Smith, Sir Dudley (Warwick)

  Lloyd, Rt Hon Sir Peter (Fareham)

  Smith, Tim (Beaconsfield)

  Lord, Michael

  Soames, Nicholas

  Luff, Peter

  Spencer, Sir Derek

  Lyell, Rt Hon Sir Nicholas

  Spicer, Sir James (W Dorset)

  MacGregor, Rt Hon John

  Spicer, Sir Michael (S Worcs)

  MacKay, Andrew

  Spink, Dr Robert

  Maclean, Rt Hon David

  Spring, Richard

  McLoughlin, Patrick

  Sproat, Iain

  McNair-Wilson, Sir Patrick

  Squire, Robin (Hornchurch)

  Madel, Sir David

  Stanley, Rt Hon Sir John

  Maitland, Lady Olga

  Steen, Anthony

  Major, Rt Hon John

  Stephen, Michael

  Malone, Gerald

  Stem, Michael

  Mans, Keith

  Stewart, Allan

  Marland, Paul

  Streeter, Gary

  Marlow, Tony

  Sumberg, David

  Marshall, John (Hendon S)

  Sweeney, Walter

  Marshall, Sir Michael (Arundel)

  Sykes, John

  Martin, David (Portsmouth S)

  Tapsell, Sir Peter

  Mates, Michael

  Taylor, Ian (Esher)

  Mawhinney, Rt Hon Dr Brian

  Taylor, John M (Solihull)

  Mellor, Rt Hon David

  Taylor, Sir Teddy (Southend, E)

  Merchant, Piers

  Temple-Morris, Peter

  Mills, Iain

  Thomason, Roy

  Mitchell, Andrew (Gedling)

  Thompson, Sir Donald (C'er V)

  Mitchell, Sir David (NW Hants)

  Thompson, Patrick (Norwich N)

  Moate, Sir Roger

  Thornton, Sir Malcolm

  Monro, Rt Hon Sir Hector

  Thumham, Peter

  Montgomery, Sir Fergus

  Townend, John (Bridlington)

  Needham, Rt Hon Richard

  Townsend, Cyril D (Bexl'yh'th)

  Nelson, Anthony

  Tracey, Richard

  Neubert, Sir Michael

  Tredinnick, David

  Newton, Rt Hon Tony

  Trend, Michael

  Nicholls, Patrick

  Trotter, Neville

  Norris, Steve

  Twinn, Dr Ian

  Onslow, Rt Hon Sir Cranley

  Vaughan, Sir Gerard

  Oppenheim, Phillip

  Waldegrave, Rt Hon William

  Ottaway, Richard

  Walden, George

  Page, Richard

  Walker, Bill (N Tayside)

  Paice, James

  Waller, Gary

  Patnick, Sir Irvine

  Ward, John

  Patten, Rt Hon John

  Wardle, Charles (Bexhill)

  Pattie, Rt Hon Sir Geoffrey

  Waterson, Nigel

  Pawsey, James

  Watts, John

  Peacock, Mrs Elizabeth

  Wells, Bowen

  Pickles, Eric

  Wheeler, Rt Hon Sir John

  Porter, Barry (Wirral S)

  Whitney, Ray

  Porter, David (Waveney)

  Whittingdale, John

  Portillo, Rt Hon Michael

  Widdecombe, Ann

  1097

  Wiggin, Sir Jerry

  Wolfson, Mark

  Wilkinson, John

  Yeo, Tim

  Willetts, David

  Young, Rt Hon Sir George

  Wilshire, David

  Tellers for the Ayes:

  Winterton, Mrs Ann (Congleton)

  Mr. Timothy Wood and

  Winterton, Nicholas (Macc'fld)

  Mr. Roger Knapman.

  NOES

  Abbott, Ms Diane

  Dixon, Don

  Adams, Mrs Irene

  Dobson, Frank

  Ainger, Nick

  Donohoe, Brian H

  Ainsworth, Robert (Covtry NE)

  Dowd, Jim

  Allen, Graham

  Dunwoody, Mrs Gwyneth

  Anderson, Donald (Swansea E)

  Eagle, Ms Angela

  Anderson, Ms Janet (Ros'dale)

  Eastham, Ken

  Armstrong, Hilary

  Etherington, Bill

  Ashdown, Rt Hon Paddy

  Evans, John (St Helens N)

  Ashton, Joe

  Ewing, Mrs Margaret

  Austin-Walker, John

  Fatchett, Derek

  Banks, Tony (Newham NW)

  Faulds, Andrew

  Barnes, Harry

  Field, Frank (Birkenhead)

  Battle, John

  Fisher, Mark

  Bayley, Hugh

  Flynn, Paul

  Beckett, Rt Hon Margaret

  Foster, Rt Hon Derek

  Beith, Rt Hon A J

  Foster, Don (Bath)

  Bell, Stuart

  Foulkes, George

  Benn, Rt Hon Tony

  Fyfe, Maria

  Bennett, Andrew F

  Galloway, George

  Bermingham, Gerald

  Gapes, Mike

  Berry, Roger

  Garrett, John

  Betts, Clive

  George, Bruce

  Blair, Rt Hon Tony

  Gerrard, Neil

  Blunkett, David

  Gilbert, Rt Hon Dr John

  Boateng, Paul

  Godman, Dr Norman A

  Bradley, Keith

  Godsiff, Roger

  Bray, Dr Jeremy

  Golding, Mrs Llin

  Brown, Gordon (Dunfermline E)

  Gordon, Mildred

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

  Grant, Bernie (Tottenham)

  Bruce, Malcolm (Gordon)

  Griffiths, Nigel (Edinburgh)

  Burden, Richard

  Griffiths, Win (Bridgend)

  Byers, Stephen

  Grocott, Bruce

  Callaghan, Jim

  Gunnell, John

  Campbell, Mrs Anne (C'bridge)

  Hain, Peter

  Campbell, Menzies (Fife NE)

  Hall, Mike

  Campbell, Ronnie (Blyth V)

  Hanson, David

  Campbell-Savours, D N

  Hardy, Peter

  Canavan, Dennis

  Harvey, Nick

  Cann, Jamie

  Hattersley, Rt Hon Roy

  Chidgey, David

  Henderson, Doug

  Chisholm, Malcolm

  Hill, Keith (Streatham)

  Church, Judith

  Hinchliffe, David

  Clapham, Michael

  Hodge, Margaret

  Clelland, David

  Hoey, Kate

  Clwyd, Mrs Ann

  Hogg, Norman (Cumbernauld)

  Coffey, Ann

  Home Robertson, John

  Cohen, Harry

  Hood, Jimmy

  Cook, Robin (Livingston)

  Hoon, Geoffrey

  Corbett, Robin

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

  Corbyn, Jeremy

  Howarth, George (Knowsley North)

  Corston, Jean

  Howells, Dr Kim (Pontypridd)

  Cousins, Jim

  Hoyle, Doug

  Cox, Tom

  Hughes, Robert (Aberdeen N)

  Cummings, John

  Hughes, Roy (Newport E)

  Cunliffe, Lawrence

  Hughes, Simon (Southwark)

  Cunningham, Jim (Covy SE)

  Hutton, John

  Dafis, Cynog

  Ingram, Adam

  Darling, Alistair

  Jackson, Glenda (H'stead)

  Davidson, Ian

  Jackson, Helen (Shef'ld, H)

  Davies, Bryan (Oldham C'tral)

  Jamieson, David

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

  Janner, Greville

  Davies, Rt Hon Denzil (Llanalli)

  Jones, Barry (Alyn and D'side)

  Davies, Ron (Caerphilly)

  Jones, Jon Owen (Cardiff C)

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

  Jones, Lynne (B'ham S O)

  Denham, John

  Jones, Martyn (Clwyd, SW)

  Dewar, Donald

  Jones, Nigel (Cheltenham)

  1098

  Jowell, Tessa

  Prentice, Gordon (Pendle)

  Kaufman, Rt Hon Gerald

  Primarolo, Dawn

  Keen, Alan

  Purchase, Ken

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

  Quin, Ms Joyce

  Khabra, Piara S

  Radice, Giles

  Kilfoyle, Peter

  Randall, Stuart

  Lestor, Joan (Eccles)

  Raynsford, Nick

  Liddell, Mrs Helen

  Reid, Dr John

  Litherland, Robert

  Rendel, David

  Livingstone, Ken

  Robertson, George (Hamilton)

  Lloyd, Tony (Stretford)

  Robinson, Geoffrey (Co'try NW)

  Llwyd, Elfyn

  Roche, Mrs Barbara

  Loyden, Eddie

  Rogers, Allan

  Lynne, Ms Liz

  Rocker, Jeff

  McAllion, John

  Ross, Ernie (Dundee W)

  McAvoy, Thomas

  Rowlands, Ted

  McCartney, Ian

  Ruddock, Joan

  McCrea, The Reverend William

  Sedgemore, Brian

  Macdonald, Calum

  Sheerman, Barry

  McFall, John

  Sheldon, Rt Hon Robert

  McKelvey, William

  Shore, Rt Hon Peter

  Mackinlay, Andrew

  Short, Clare

  McLeish, Henry

  Simpson, Alan

  McNamara, Kevin

  Skinner, Dennis

  MacShane, Denis

  Smith, Andrew (Oxford E)

  McWilliam, John

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

  Madden, Max

  Smith, Llew (Blaenau Gwent)

  Maddock, Diana

  Snape, Peter

  Mahon, Alice

  Soley, Clive

  Mandelson, Peter

  Spearing, Nigel

  Marek, Dr John

  Speller, John

  Marshall, David (Shettleston)

  Squire, Rachel (Dunfermline W)

  Marshall, Jim (Leicester, S)

  Steinberg, Gerry

  Martin, Michael J (Springburn)

  Stevenson, George

  Martlew, Eric

  Stott, Roger

  Maxton, John

  Strang, Dr. Gavin

  Meacher, Michael

  Straw, Jack

  Meale, Alan

  Sutcliffe, Gerry

  Michael, Alun

  Taylor, Mrs Ann (Dewsbury)

  Michie, Bill (Sheffield Heeley)

  Thompson, Jack (Wansbeck)

  Michie, Mrs Ray (Argyll & Bute)

  Timms, Stephen

  Milburn, Alan

  Tipping, Paddy

  Miller, Andrew

  Touhig, Don

  Mitchell, Austin (Gt Grimsby)

  Turner, Dennis

  Moonie, Dr Lewis

  Tyler, Paul

  Morgan, Rhodri

  Vaz, Keith

  Morley, Elliot

  Walker, Rt Hon Sir Harold

  Morris, Rt Hon Alfred (Wy'nshawe)

  Walley, Joan

  Morris, Estelle (B'ham Yardley)

  Wardell, Gareth (Gower)

  Morris, Rt Hon John (Aberavon)

  Wareing, Robert N

  Mowlam, Marjorie

  Watson, Mike

  Mudie, George

  Wicks, Malcolm

  Mullin, Chris

  Wigley, Dafydd

  Murphy, Paul

  Williams, Rt Hon Alan (Sw'n W)

  Oakes, Rt Hon Gordon

  Williams, Alan W (Carmarthen)

  O'Brien, Mike (N W'kshire)

  Wilson, Brian

  O'Brien, William (Normanton)

  Winnick, David

  O'Hara, Edward

  Wise, Audrey

  Olner, Bill

  Worthington, Tony

  O'Neill, Martin

  Wray, Jimmy

  Parry, Robert

  Wright, Dr Tony

  Pendry, Tom

  Young, David (Bolton SE)

  Pickthall, Colin

  Pike, Peter L

  Tellers for the Noes:

  Pope, Greg

  Mr. Eric Clarke and

  Powell, Ray (Ogmore)

  Mr. Joe Benton

  Prentice, Bridget (Lew'm E)

  Question accordingly agreed to.
  Resolved,
  That the Local Government Finance Report (England) 1996–97 (House of Commons Paper No. 164), which was laid before this House on 29th January, be approved.
  Resolved,
  That the National Parks Supplementary Grant Report (England) 1996–97 (House of Commons Paper No. 167), which was laid before this House on 29th January, be approved.
  Resolved,
  That the Limitation of Council Tax and Precepts (Relevant Notional Amounts) Report (England) 1996–97 (House of Commons Paper No. 166), which was laid before this House on 29th January, be approved.
  Resolved,
  That the Special Grant Report (No. 16) (House of Commons Paper No. 165), which was laid before this House on 29th January, be approved.—[Mr. Brandreth]

  Local Government Reform (Southport)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Brandreth.]
  10.14 pm
  Mr. Matthew Banks: It is a great honour to be a Member of Parliament, and a particular honour to represent the delightful seaside resort of Southport. As you know, Mr. Deputy Speaker, before 1974 my constituency was a unitary authority that looked to Lancashire, not to Liverpool. But since 1974, it has been swallowed up by Merseyside and lost its independence.
  The Southport county borough was proudly independent and self-governing throughout most of this century, from the 1900s to 1974. During that time, Southport had some of the lowest rates in the United Kingdom, and, I am pleased to report, was controlled by an efficient Conservative council.
  In 1974, when Southport was swallowed up, a new authority called Sefton metropolitan borough council was created, including the parliamentary constituencies of Crosby and Bootle. Because of the geography and the make-up of the area, I have never believed, and nor have my constituents, that the metropolitan borough council works in their interests, or in those of Southport as a whole.
  From the time when I was selected as a prospective parliamentary candidate in early 1989, I pledged that, if I were elected—and, indeed, up to and including the election—I would work unceasingly to find a mechanism to ensure that the local government structure for Southport was reviewed. Not content with that pledge, I went further. I publicly promised that I would ensure that such a review would begin in the lifetime of this Parliament, not at some unspecified date in the future. It is now time for that process to commence.
  I look to my hon. Friend the Under-Secretary of State to make such a commitment at the end of the debate. Recently, in answer to yet another of my parliamentary questions, the Secretary of State said that the Local Government Commission had completed its review of the structure of local government in the shire counties, and that he was now considering the recommendations in the commission's final report, which was published on 19 December. No doubt my right hon. Friend will spend some time considering the report, but I believe that it is now time for the structure of local government in my constituency to be reviewed.
  Southport county borough under the Conservatives had the among the lowest rates in the country. It was well run and efficient, and took much pride in itself and in the town. But since Merseyside swallowed up my constituency, that pride has been a little tarnished, and I am determined to reverse that trend so that Southport can be proud and independent in Lancashire again.
  I place on record my thanks to the independent cross-party Southport borough campaign. With my assistance, it organised a referendum within the town, which took place over a period of one month. Before that, in one of a series of meetings that I have had over several years with the Secretary of State, the Local Government Commission and other Ministers at the Department of the Environment, I was asked whether I could demonstrate that at least 5,000 of my constituents wanted a change. I told my right hon. Friend that I could do rather better than

  1101
  that—and indeed, over the month of the referendum, about 23,000 of my constituents made it clear that they wanted that change. I was determined, on their behalf, that the change should come about.
  Despite that large number, I do not believe that the Local Government Commission gave me the kind of response for which I would have wished. In fact, in my view the then chairman did not keep his verbal and written promise to me. Since then, I have felt very much alone in my battle with Whitehall and Westminster to ensure that the matter remains on the agenda, culminating in tonight's debate.
  I would like to thank also my hon. Friends who have joined me in the House tonight. Blackpool has sought to move away from the control of Lancashire county council, and I am pleased to see my hon. Friend the Member for Blackpool, North (Mr. Elletson) is in his place, as is my hon. Friend the Member for Ribble Valley (Mr. Evans). I am particularly pleased to see my right hon. Friend the Member for Wirral, West (Mr. Hunt), as he has fought so hard for his constituency and for the constituency of my hon. Friend the Member for Wirral, South (Mr. Porter).
  Mr. David Hunt: Does my hon. Friend agree that there are similar strong feelings about the need for a review of the structure of local government in Wirral, and particularly in the constituencies of Wirral, West and Wirral, South? Thousands of representations have been received over a lengthy period from local people. He has our strong support, and I very much hope that we will have his.
  Mr. Banks: I am grateful to my right hon. Friend. He knows full well that he has my support. We have stood together in these discussions, and I very much hope that at some future date—not too far away—the Local Government Commission will, as a result of my right hon. Friend's efforts, review the structure of local government in the Wirral also.
  I should like to place on record my thanks to my former parliamentary assistant and great friend Roderick Brown, my agent, Mr. John Critten, and my parliamentary secretary here at Westminster, Jane Banks, for all their help behind the scenes in bringing this matter to a satisfactory resolution. I am pleased to see that Jane, who doubles as my wife, is here tonight. I am only sorry that, as I did not have a great deal of notice of the debate, other constituents have not been able to be present to see the debate. No hon. Member has a more supportive or politically astute spouse, and Southport is extremely lucky to have her.
  May I also place on record my thanks to my right hon. Friend the Member for Mid-Norfolk (Mr. Ryder), the former Chief Whip, who had to bear the brunt of my sometimes gritty determination. I am grateful to my right hon. Friend the Member for Derby, North (Mr. Knight) and to my former Whip my hon. Friend the Member for Brigg and Cleethorpes (Mr. Brown), who know how hard I have had to battle behind the scenes on this issue.
  I read with great interest today my local newspapers in Southport—the Advertiser, the Visiter and the Champion. I noticed a front-page article in the Southport Champion with the headline: "Town to quit Sefton? MP Banks pushes for Southport to go it alone."
  Further down the front page, there were some comments from the former Member of Parliament, Councillor Ronald Fearn. I quote what he said in the article:
  1102
  "I have campaigned for this for 20 years. I hope Mr. Gummer gets his finger out and does something. We do not want any more vague promises, we want action."
  That comes from a man who, in 1973, voted as a councillor to go into Merseyside in the first place and did nothing in the intervening years. In February 1992, he voted with the Labour party in each and every Division in this House against the creation of the very Local Government Commission that is our only chance of gaining independence from Merseyside.
  Mr. Harold Elletson: Is my hon. Friend aware that Councillor Fearn was in this House for four years, but did nothing to get Southport back into Lancashire? My hon. Friend has fought his campaign valiantly to get Southport back where it belongs—in the red rose county of Lancashire.
  Mr. Banks: I am grateful to my hon. Friend. As I mentioned, Blackpool will be gaining its independence from Lancashire county council very shortly, as will Blackburn and, I hope, other places.
  The importance of the size of a particular potential unitary authority has also been brought into question. Blackpool and Blackburn have gained independence that they did not have before 1974, and a town such as Hartlepool—of a similar size to Southport—has done so also. I have no truck with those who say that Southport will not be big enough to run its own affairs. It did so before 1974, and it can, and—if I have anything to do with it—will, again.
  The only issue of contention has been put about by those with a vested interest, who say that senior citizens will not be able to benefit from the generous current concessionary travel schemes. I do not believe that any successor authority would want to do other than continue to opt into the concessionary travel scheme that currently exists in Southport and the metropolitan area. Any candidate from any political party who said otherwise would not be elected.
  Breaking away from Sefton and ceasing to be run by Bootle will allow the tourist industry in my constituency to develop properly. At present, Bootle councillors do not give a damn about what happens in Southport. It is nonsense for them to suggest that we might come third, behind Blackpool and St Anne's as a resort. We have our own product: it is different from Blackpool's, and we are very proud of it.
  I believe that, if the Minister is prepared to give the go-ahead tonight, a review can not merely get under way in the lifetime of the present Parliament but begin in a matter of weeks. I should like the Local Government Commission to institute a referendum, so that local people can give their views, to arrange public meetings and consultation, and to take sufficient time to listen carefully to local opinion.
  Such reviews take a long time. The shire review has taken at least a year, and it may well take longer than that to complete the review of Southport and Sefton. My constituents must remember that this Government, and this Conservative party, will give them the opportunity of a review and the chance of independence. Mindful of the actions of my predecessor—a Liberal Democrat—and his party's and Labour's policy for regional government, I fear that, in the unlikely event of a Labour Government,

  1103
  those two parties would not complete the review I seek. The interests of my constituents will best be served by the re-election of the present Government.
  I am grateful to my right hon. Friend the Secretary of State for the Environment and to his ministerial team for the way in which, over a number of years, they have listened to the arguments that I have advanced, sometimes forcefully. Now, however, the time for debate is over, and the review should begin. We want our independence in Southport to be considered as soon as possible, and I look to my hon. Friend the Under-Secretary of State to announce the review for which I have asked, so that, once again, my constituency can run its own affairs and get out of Sefton and Merseyside once and for all.
  10.26 pm
  The Parliamentary Under-Secretary of State for the Environment (Sir Paul Beresford): I congratulate my hon. Friend the Member for Southport (Mr. Banks) on stepping into the breach on an urgent basis. I note that he has the heavy brigade behind him in the form of my hon. Friends the Members for Blackpool, North (Mr. Elletson) and for Ribble Valley (Mr. Evans)—and, of course, my right hon. Friend the Member for Wirral, West (Mr. Hunt), who is pushing a similar case to which we must give consideration. I am delighted to respond to the points that my hon. Friend the Member for Southport has made so emphatically. Unusually but effectively, his wife has supported him, campaigning vigorously.
  Since 1974, when the change came about, people in Southport have objected to being part of Merseyside. It is not just being in Merseyside rather than Lancashire that is unpopular; given Southport's former status as an independent county borough, people also dislike being part of the larger metropolitan borough of Sefton, along with Bootle and Crosby. My hon. Friend's wish for Southport to be returned to Lancashire is long-standing: he spoke of it on the first occasion he spoke in the House, and he has continued to speak of it ever since.
  The Local Government Commission's remit covers structural, electoral and boundary changes. When it was set up in 1992, its first priority was the structural review of the English shire counties; however, in September 1993, we made it clear that the commission would be able to review the metropolitan areas when the shire reviews were completed, where there was pressure for change. There has certainly been strong pressure in Southport, perhaps to a unique degree—aided, abetted and pushed by my hon. Friend.
  In September 1993, the Local Government Commission received the results of the ballot carried out in Southport. Of 35,000 ballot papers delivered, an extraordinary 23,000 were returned in favour of a review and less than 1,000 against. That was a positive response rate. From an area with an electorate of 72,000, it must be taken as a dramatic indication of local opinion.
  The commission has concluded the shire structure reviews, including the further district reviews in counties such as Lancashire. Its main priority now is the periodic electoral reviews. It is bound by statute to undertake those and, as far as practicable, within no more than 15 years since the previous review. Those are becoming increasingly urgent in a number of places, and that work should take precedence. However, there will be room in its programme to carry out a few other reviews.
  1104
  My hon. Friend met my right hon. Friend the Secretary of State before Christmas, and he knows that we are aware of the strength of feeling in Southport. I can confirm to him that one of the commission's additional reviews will be that of Southport.
  Any review, except for a periodic electoral review, needs a direction to the commission from the Secretary of State. We are considering whether the direction will tell the commission to consider Southport or the whole of Sefton. It is important, however, that it is clear that the commission is not being directed towards a particular outcome.
  It will also be necessary, as with the individual district reviews, which have just been completed, for the commission to consider the viability of the remnant authority that might result. That is not to say that it will not know what pressures led to any particular review. I suspect that my hon. Friend will not allow it to forget.
  The basic procedures that the commission has to follow in any review are set down in the Local Government Act 1992. There must be two intervals for consultation and representations—before and after it produces its draft recommendations. Although guidance can expand on that procedure, the detail of how it conducts a review should be left to the commission to decide. That would include how it might measure the attitude of the general public. My hon. Friend might like to approach the commission directly to find out what methods it would like to use for the boundary review.
  The recommendations at the end of any review are, of course, a matter entirely for the commission. In the case of a review of a metropolitan area, however, some constraints arise from the Act. For example, it defines a structural change only as a change from a two-tier system of local government to a one-tier system; there cannot be a change in the opposite direction.
  In addition, a unitary authority cannot be part of two-tier county area. In other words, a unitary Southport self-evidently could not be part of a two-tier Lancashire under Lancashire county council, although the two could be deemed to be joined for ceremonial purposes, such as the lord lieutenancy. It is therefore helpful that the shire structure reviews are now complete—subject to my right hon. Friend's decisions on the commission's final reports on the district reviews—so that the context is clear.
  I said that there is room in the commission's programme for a few boundary or parishing reviews and that one of those will be of Sefton. We hope to be able to announce soon what the others will be. That will be when the commission announces its programme of periodic electoral reviews. We are working on the direction and guidance to the commission. We will also be discussing with it what would be an appropriate length of time for the review, given the issues that have to be addressed in metropolitan areas.
  Once again, I congratulate my hon. Friend on the force and energy that he has put into this subject, in the face of the failure of his predecessor, and on his success in ensuring that local government in Southport will be considered by the commission.
  Question put and agreed to.
  Adjourned accordingly at twenty-seven minutes to Eleven o'clock.

LORD CHANCELLOR'S DEPARTMENT

  Inquest (North Wales)
  Mr. Peter Bottomley
  To ask the Parliamentary Secretary, Lord Chancellor's Department what operation and when it was carried out on patient C, the subject of an inquest in north Wales; who was the coroner at the inquest; what factors underlay the decisions(a) not to name the patient and (b) not to publish the date of the inquest; and what evidence was given by public officials during the proceedings on the case. [11927]

  Mr. Jonathan Evans
  The question concerns a specific operational matter on which the chief executive of the Court Service is best placed to provide an answer and I have accordingly asked the chief executive to reply direct.

  Letter from M. D. Huebner to Mr. Peter Bottomley, dated 31 January 1996:
  The Parliamentary Secretary, Lord Chancellor's Department has asked me to reply to the above Question about the recent legal proceedings concerning Patient C. In doing so I have consulted with the Home Office and Welsh Office on the issues that are within their jurisdiction.
  Patient C entered hospital on 26 February 1991 for elective extraction of wisdom teeth. I understand that the death was reported to the coroner for East Clwyd, Mr. Jones, and that a date for the inquest has yet to be fixed. Patient C was the subject of an application to the Family Division of the High Court for a declaration that life-sustaining treatment and medical support be discontinued. In that application, Mr. Justice Johnson made an order under section 11 of the Contempt of Court Act 1981 that Patient C and other connected individuals should not be named. Two further applications came before Sir Stephen Brown, the President of the Family Division. So far as the evidence given by public officials is concerned, I have arranged for copies of the three judgments in this matter to be made available in the library of the House.

  Maxwell Fraud Trial
  Mr. John Marshall
  To ask the Parliamentary Secretary, Lord Chancellor's Department what is the estimated cost to the legal aid fund of the Maxwell fraud trial. [11717]

  Mr. Jonathan Evans
  It would not be appropriate for me to speculate at this stage about the final cost of this case.

DUCHY OF LANCASTER

  CCTA
  Mr. Patrick Thompson
  To ask the Chancellor of the Duchy of Lancaster what are his plans for the CCTA, the Government centre for information systems. [13228]
  750
  Mr. Freeman
  The CCTA, currently an operational division of the Office of Public Service will, from 1 April 1996, operate as a next steps executive agency within OPS, and will remain based in Norwich. This will ensure that Government Departments continue to have available to them a range of expert specialist services in information technology and telecommunications which are independent and are valued by Departments.

  As an agency, CCTA will operate on a full cost recovery basis. It will therefore need to develop a stronger customer focus and undergo major restructuring and efficiency measures. It will work in close co-operation with the new central information technology unit which is being established in the OPS to provide a strategic approach to the use of information technology in government.

  F16 Aircraft
  Dr. David Clark
  To ask the Deputy Prime Minister what representations he has had from the United Kingdom defence industry concerning the proposed leasing of American F16 aircraft. [12127]

  The Deputy Prime Minister
  I have received a number of representations from the UK defence industry concerning the Ministry of Defence's evaluation of a proposal to upgrade the Tornado F3's weapons systems.

  Those representations have been passed on to the Ministry of Defence in the normal way.

  Photocopiers
  Mr. Nigel Griffiths
  To ask the Chancellor of the Duchy of Lancaster how many new photocopiers his Department has(a) purchased and (b) leased since July 1995; and at what cost. [4291]

  Mr. Willets
  [pursuant to his reply, 6 December 1995, Official Report, c 256]: I regret that the figure given as the rental cost per annum of the 14 leased photocopiers to replace existing machines is incorrect. The correct information is as follows.

  Since 1 July 1995, the Cabinet Office and its agencies have purchased one additional photocopier at a cost of £895 and leased 18 photocopiers, 11 of which replaced existing machines, at a rental cost of £50,799 per annum.

  In the same period, HMSO and the Central Office of Information purchased four photocopiers, two Of which replaced existing machines, at a cost of £17,817 and leased 14 to replace existing machines at a rental cost of £23,366 per annum.

  Mr. Griffiths
  To ask the Deputy Prime Minister, pursuant to his answer of 9 January 1996,Official Report, column 121, what factors led his Department to accept photocopiers on variable contracts of three, four and five years over and above the leasing costs; and what is the minimum contractual cost of using and maintaining (a) the 18 photocopiers on three-year contracts, (b) the three photocopiers on four-year contracts and (c) the four photocopiers on five-year contracts. [8920]
  751
  Mr. Willetts
  [pursuant to his reply, 15 January 1996, Official Report, c 335]: I regret that the figure given as the minimum total cost of leasing the 18 photocopiers on three-year contracts is incorrect. The correct information is as follows.

  The minimum total cost of leasing (a) the 18 photocopiers on three-year contracts is £36,905 per annum, (b) the three photocopiers on four-year contracts is £15,969 per annum and (c) the four photocopiers on five-year contracts is £3,315 per annum.

  Mr. Griffiths
  To ask the Deputy Prime Minister, pursuant to his answer of 15 January 1996,Official Report, column 335, on costs of photocopiers, what was the estimated number of copies projected in respect of each contract and at what cost per copy. [10277]

  Mr. Willetts
  [pursuant to his reply, 22 January 1996, Official Report, c.42]: I regret that the figure of 0.3p given as the cost per copy for the machine with the projected usage of 5 million copies is incorrect. The correct figure is 0.4p. The entire table with the corrected figure is as follows:

  Estimated number of copies projected in respect of each contract and cost per copy for the 25 photocopiers

  Copies projected for contract period

  Cost per copy (p)

  24,000,000

  0.32

  24,000,000

  0.32

  1,800,000

  0.71

  1,800,000

  0.79

  1,800,000

  0.79

  900,000

  0.65

  360,000

  0.85

  324,000

  0.90

  270,000

  0.91

  252,000

  0.91

  252,000

  0.84

  240,000

  0.91

  240,000

  0.91

  240,000

  0.91

  240,000

  0.91

  180,000

  0.97

  180,000

  0.97

  144,000

  0.91

  108,000

  0.91

  108,000

  0.95

  72,000

  0.95

  60,000

  0.97

  48,000

  0.97

  1,620,000

  0.81 per first 90,000 per annum

  0.63 thereafter

  5,000,000

  First 1.2 million per annum included in contract price,

  next 200,000 at 0.5 per copy

  thereafter 0.4 per copy

  Absenteeism
  Mr. Malcolm Bruce
  To ask the Deputy Prime Minister, what estimate he has made of absenteeism rates in days per annum for staff in his Department for 1995–96. [11373]
  752
  Mr. Willetts
  The table below gives the available absenteeism figures for the central Cabinet Office including No. 10 and the executive agencies for which I am responsible. Figures for previous years and 1995–96 are not available.

  1993–94

  1994–95

  Central Department

  8.48

  8.45

  COI

  7.76

  9.67

  CS College

  7.00

  6.40

  HMSO

  9.86

  7.03

  OHSA

  8.82

  14.52

  RAS

  8.58

  12.99

  Chessington

  9.00

  10.37

  SAFE

  4.34

  11.05

  TBA

  9.97

  8.70

  Total

  8.35

  8.61

  Absence rates represent total days absent divided by total number of staff.

  Departmental Expenditure
  Mr. Malcolm Bruce
  To ask the Deputy Prime Minister what is his estimate of departmental expenditure on administration for(a) 1995–96 and (b) 1996–97. [11505]

  Mr. Willetts
  Details of running costs and administrative spending by the Cabinet Office, including the Prime Minister's Office, and the Office of Public Service for the years 1989–90 through to 1997–98 are contained in tables 7.5 and 7.6 of my Department's annual report, Cm 2820, copies of which are available in the Members' Library. This year's report, due to be published at the end of March, will reflect the Cabinet Office's new responsibilities, following the machinery of government and other changes.

  Mr. Bruce
  To ask the Deputy Prime Minister what is his estimate of his Department's expenditure on newspapers and magazines for 1995–96 to date; and if he will list the publications purchased. [11508]

  Mr. Willetts
  This information, and similar information for earlier years, can be provided only at disproportionate cost.

TREASURY

  Unemployment
  Mr. Llew Smith
  To ask the Chancellor of the Exchequer what estimate he has made of the number of person days lost through unemployment since May 1979. [12316]

  Mrs. Angela Knight
  There is no means of assessing such a figure because no central records are kept of the numbers of hours unemployed people worked prior to becoming unemployed, nor of the number of hours they now wish to work.

  North Sea Oil and Gas
  Mr. Battle
  To ask the Chancellor of the Exchequer how much income the Government have received from North sea(a) oil and (b) gas exploitation for each year since 1979. [12480]
  753
  Mr. Jack
  Tax revenues from oil and gas production were given in answer to the hon. Member for Warley, West (Mr. Spellar) on 12 December 1995,Official Report, columns 1053–54. Separate figures for revenues from oil and gas are not available because the main taxes concerned, corporation tax and petroleum revenue tax, are charged on aggregate company and field profits respectively. Royalties are also levied on each field's aggregate production. Many companies have interests in both oil and gas extraction and, in many fields, both products are extracted.

  Positive about Disabled People Symbol
  Mr. Barnes
  To ask the Chancellor of the Exchequer if he will list for his Department and each of the agencies for which he is responsible, if it uses the Employment Service's positive about disabled people symbol for(a) external recruitment and (b) internal recruitment and promotion. [11992]

  Mrs. Angela Knight
  The Employment Service's positive about disabled people symbol is one of the action points in the Department's action plan on disability introduced last year.

  Of the Treasury's four agencies, one—the Royal Mint—currently uses the symbol for external recruitment. The Central Statistical Office, Paymaster and the Valuation Office agency are considering whether to become symbol users.

  Bills (Late Payment)
  Mrs. Roche
  To ask the Chancellor of the Exchequer what discussions his Department has had with other Government Departments following the publication of the figures showing percentages of bills paid late in 1994–95. [12223]

  Mrs. Angela Knight
  [holding answer 29 January 1996]: The Treasury has an ongoing dialogue with other Government Departments and commercial organisations on a range of procurement-related topics, including bill payment. Lessons learnt during these discussions can result in the adoption of more efficient methods of working for all concerned.

  The Treasury is a signatory to the Confederation of British Industry code of payment.

  Retail Prices Index
  Sir Timothy Sainsbury
  To ask the Chancellor of the Exchequer (1) if he will instruct the retail prices index advisory committee to assess whether the retail prices index takes sufficient account of(a) quality change new versions of products, (b) totally new products and
  (c) a formula bias arising from overweighting of items entering the index at temporarily low prices; [12692]

  (2) if he will instruct the retail prices index advisory committee to assess whether (a) the retail prices index takes proper account of the number of discount stores and (b) there is an outlet bias; [12693]

  (3) if he will instruct the retail prices index advisory committee to assess whether the index takes sufficient account of the incidence of special offers. [12698]
  754
  Mr. Kenneth Clarke
  I have no plans at present to convene the retail prices index advisory committee. However, a recent report by Nicholas Oulton of the National Institute of Economic and Social Research, commissioned by the Treasury, looked at many of these issues in detail. This report, "Treasury Working Paper 68: Reliability and Accuracy in UK Price Indices", which was published in March 1995, is available in the House of Commons Library.

  Disabled People (VAT)
  Mr. Austin Mitchell
  To ask the Chancellor of the Exchequer (1) what factors have led to the imposition of VAT on disabled individuals purchasing computer equipment; [12691]

  (2) if he will (a) place in the Library and (b) publish the Customs and Excise directive concerning the levying of VAT on purchases of computer equipment for disabled people; [12689]

  (3) which bodies representing the rights of the disabled were consulted in relation to the re-interpretation of the VAT legislation on the purchasing of computer equipment. [12690]

  Mr. Heathcoat-Amory
  There have been no changes in the application of VAT to computer equipment for disabled people. Such equipment, when designed solely for disabled people's use, is zero rated. General purpose equipment is, and always has been, liable at the standard rate. There has been no need to consult because there has been no re-interpretation of the law.

  No directives on the liability of computer equipment have been issued by Customs and Excise. A copy of customs notice 701/7/94, "VAT reliefs for people with disabilities", has already been placed in the Library of the House.

  Gross Domestic Product
  Mr. Alan W. Williams
  To ask the Chancellor of the Exchequer what has been the average annual rate of growth of Britain's gross domestic product(a) since the first quarter of 1990 and (b) since the first quarter of 1979. [12596]

  Mrs. Angela Knight
  The average annual rate of growth of Britain's real GDP—gross domestic product at constant factor cost—between the first quarter of 1990 and the fourth quarter of 1995 was 1.1 per cent. Between the first quarter of 1979 and the fourth quarter of 1995, the average annual rate of growth was 2 per cent.

  Employment Statistics (Lancashire)
  Mr. Pike
  To ask the Chancellor of the Exchequer how many and what percentage of(a) manual and (b) non-manual (i) male and (ii) female part-time workers work less than (1) eight hours, (2) 16 hours and (3) 24 hours in each borough in Lancashire. [12839]

  Mrs. Angela Knight
  It is not possible to provide data for county boroughs.

  Information showing hours worked by part-time men and women in Lancashire is given in the table.
  755

  New Earnings survey 1995

  Part-time employees in Lancashire—weekly hours

  Percentage working less than:

  Excluding overtime

  Including overtime

  8 hours

  16 hours

  24 hours

  8 hours

  16 hours

  24 hours

  Manual

  Male

  18.9

  41.5

  71.7

  17.0

  37.7

  66.0

  Female

  7.5

  35.0

  70.6

  7.5

  32.5

  65.6

  Total

  10.3

  36.6

  70.9

  9.9

  33.8

  65.7

  Non-Manual

  Male

  33.3

  51.3

  69.2

  30.8

  51.3

  69.2

  Female

  10.8

  29.7

  70.3

  10.3

  27.7

  66.9

  Total

  12.8

  31.7

  70.2

  12.1

  29.8

  67.1

  All

  Male

  25.0

  45.7

  70.7

  22.8

  43.5

  67.4

  Female

  9.8

  31.3

  70.4

  9.5

  29.1

  66.5

  Total

  12.0

  33.3

  70.4

  11.4

  31.2

  66.7

  Debt
  Mr. Malcolm Bruce
  To ask the Chancellor of the Exchequer what was the amount of debt per household for every £100 of disposable income at the last date for which figures are available; and if he will make a statement. [12024]

  Mr. Angela Knight
  There are no official estimates of the financial assets and liabilities of the household sector. Estimates for the personal sector—which includes households, individuals, private trusts, unincorporated businesses and non profit-making bodies serving persons—are published by the Central Statistical Office in table 12.2 of the "UK National Accounts", known as the "Blue Book", which is available in the Library of the House. At the end of 1994, the personal sector had financial liabilities worth £524 billion, financial assets worth £1,656 billion, and non-financial assets worth £1,419 billion, implying total net wealth of £2,551 billion. Personal disposable income in 1994 was £473 billion. So, for every £100 of disposable income, the personal sector held £111 of financial liabilities and had total net wealth of £539 at the end of 1994.

DEFENCE

  Land Mines
  Mr. Cohen
  To ask the Secretary of State for Defence what mechanisms exist to ensure public notification occurs in respect of changes in the moratorium on the export of land mines. [12761]

  Mr. Arbuthnot
  Any change to the UK's moratorium on the export of anti-personnel mines would be notified to Parliament, as was the change announced on 15 March 1995 by my hon. Friend the Minister of State for Foreign and Commonwealth Affairs,Official Report, columns 860–63.

  Annualised Average Temperatures
  Mr. Alan W. Williams
  To ask the Secretary of State for Defence what was the annualised average temperature for mainland Britain for each of the years 1990 to 1995;756
  and what recent estimates he has made of the historic average mean temperature since records began. [11238]

  Mr. Arbuthnot
  This is a matter for the chief executive of the Meteorological Office. I have asked the chief executive to write to the hon. Member.

  Letter from J. C. R. Hunt to Mr. Alan W. Williams, dated 31 January 1996:
  I am replying to your Question to the Secretary of State for Defence about temperatures in mainland Britain as this matter falls within my area of responsibility as Chief Executive of the Meteorological Office.
  The annualised average temperatures for mainland Britain (i.e. United Kingdom excluding Northern Ireland) 1990–1995 are:

  1990: 10.0°C

  1991: 9.2°C

  1992: 9.3°C

  1993: 8.9°C

  1994: 9.5°C

  1995: 9.8°C

  The last 4 decades 1956–1965, 1966–1975, 1976–1985, 1986–1995 show values of 8.9, 9.0, 8.9. 9.3 respectively.
  The natural climate variability of the UK area is such that this apparent warming has little statistical significance. As a perspective a diagram illustrating annual values over the period back to 1659 is attached. The diagram does not refer to the whole UK as reliable data for Scotland is not available before 1851.
  The attached reports give a full background should you wish to be more aware of the position and issues.
  I hope you find the information helpful.

  Former Yugoslavia
  Mr. David Martin
  To ask the Secretary of State for Defence if he will make a statement on military deployment to the former Yugoslavia. [13420]

  Mr. Portillo
  The deployment of British armed forces to the NATO-led peace implementation force, IFOR, in Bosnia is now complete.

  By carefully matching the manpower required to the tasks which have emerged, we have been able to deploy a smaller number of troops than the estimate of over 13,000 reported in my statement to the House of 12 December

  757
  1995, Official Report, column 835. The actual figure is some 11,500. The United Kingdom's contribution remains, by a substantial margin, second only to that of the United States.

  I shall keep the force level under review as planning develops for the reduction of IFOR numbers and the completion of its task. NATO is also reviewing the maritime and air forces required to support operations in the Adriatic theatre. Force levels can in any case be expected to fluctuate.

  Type 23 Frigates
  Mr. Menzies Campbell
  To ask the Secretary of State for Defence when he expects to announce the order for the next batch of type 23 frigates. [12858]

  Mr. Arbuthnot
  An announcement will be made as soon as the decision has been taken.

  Chemical Weapons Stocks
  Mr. Llew Smith
  To ask the Secretary of State for Defence if he will publish the total amounts of chemical weapons and precursor stocks, by location, held by his Department. [12861]

  Mr. Arbuthnot
  No. The UK has not had an offensive chemical weapons capability since the 1950s. Items dating from the 1950s and before are discovered from time to time and taken to the Chemical and Biological Defence Establishment for safe destruction. Small quantities of scheduled chemicals are held for purposes permitted by the chemical weapons convention; on security grounds, information about their quantity and location is safeguarded.

  Mr. David Hart
  Dr. David Clark
  To ask the Secretary of State for Defence if Mr. David Hart has a role in his Department's postings and personnel selections. [12862]

  Mr. Portillo
  No.

HOME DEPARTMENT

  Prisoners (Hospital Visits)
  Mr. McNamara
  To ask the Secretary of State for the Home Department how many prisoners who attended hospital for confinement in each of the past 10 years (1) have(a) succeeded in escaping and (b) attempted to escape, (i) one hour before, (ii) two hours before, (iii) three hours before, (iv) four hours before and (v) five hours before their delivery and (2) have (a) succeeded in escaping and (b) attempted to escape (i) one hour after, (ii) two hours after, (iii) three hours after, (iv) four hours after and (v) five hours after their delivery. [8547]

  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.
  758
  Letter from Richard Tilt to Mr. Kevin McNamara, dated 31 January 1996:
  The Home Secretary has asked me to reply to your recent Question about prisoners who have escaped or attempted to escape having attended hospital for confinement in the past 10 years.
  Since 1988, when a data-base of escapes was first set up, the Prison Service has recorded no incidents of any woman escaping during the last stages of labour or during childbirth. One woman prisoner is recorded as having escaped more than five hours after the birth of her child. The child was abandoned at the hospital. There are no recorded incidents of attempted escape during or after confinement.

  Women Prisoners (Hospital Treatment)
  Mr. George Howarth
  To ask the Secretary of State for the Home Department (1) what discussions his Department has had with the Whittington Hospital NHS trust in respect of its concerns over the practice of handcuffing and chaining women prisoners; [9493]

  (2) when his Department learnt that the Whittington Hospital NHS trust had expressed concern at the practice of handcuffing and chaining pregnant women prisoners. [9494]

  Miss Widdecombe
  [holding answer 15 January 1996]: This matter was first raised with the Prison Service on 31 August 1995, when the chief executive of the Whittington hospital wrote to the governor of Holloway prison. There has been further correspondence since then.

  Mr. Corbyn
  To ask the Secretary of State for the Home Department if he will publish all correspondence between the Whittington hospital and HMP Holloway concerning the handcuffing of women prisoners during visits to the hospital; and if he will make a statement. [11642]

  Miss Widdecombe
  [holding answer 24 January 1996]: The temporary Director General of the Prison Service has reviewed the policy on the application of physical restraints to prisoners attending hospital, particularly pregnant prisoners and my right hon. and learned Friend announced this policy to the House on 18 January, Official Report, columns 893–94.

  Copies of correspondence between the Whittington hospital and Holloway prison about this subject will be placed in the Library.

  Alton Manning (Death)
  Mr. Mullin
  To ask the Secretary of State for the Home Department if he will make a statement on the death of Alton Manning on 8 December in Blakenhurst prison. [12094]

  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. Chris Mullin, dated 31 January 1996:
  The Home Secretary has asked me to reply to your recent Question about the death of Mr. Alton Manning on 8 December 1995 in Blakenhurst prison.

  759
  All deaths in custody are investigated by the Coroner whose inquest is a full and public inquiry. The Coroner is currently conducting the investigation into Mr. Manning's death and a date for the inquest is yet to be fixed. I am unable at this stage to comment on the detailed circumstances of the case.

  Voluntary School Helpers
  Mr. Chris Davies
  To ask the Secretary of State for the Home Department what advice has been issued to police forces by the Home Office recommending that the carrying out of police checks on voluntary school helpers be discontinued; and if he will make a statement. [12302]

  Mr. Maclean
  No such advice has been issued. The relevant guidance on the criteria which justify carrying out a criminal record check on people working in schools, whether as paid employees or as volunteers, is currently set out in Home Office circular 47/93. This states that, in order for a person to be subject to a police check, the post for which he or she is applying"should entail a substantial level of access to children which may also be unsupervised, and will be regular or sustained."

  These criteria were first agreed with the Association of Chief Police Officers in 1986 and have not changed.

  Contractor

  Contract started

  Length of contract

  Original contract price

  Wolds

  Group 4

  1 April 1992

  5 years

  £29.87 million: estimate over 5 years when contract awarded

  Blakenhurst

  UKDS

  26 May 1993

  5 years

  £57 million

  Doncaster

  PPS

  20 June 1994

  5 years

  £66 million

  Buckley Hall

  Group 4

  14 December 1994

  5 years

  £33 million

  Women's Prisons
  Ms Jowell
  To ask the Secretary of State for the Home Department what was the estimated outstanding repair and maintenance bill of each women's prison for each year since 1985; and what was the actual spending on maintenance and repair at each prison in each of those years. [11493]

  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 Tessa Jowell, dated 31 January 1996:
  The Home Secretary has asked me to reply to your recent Question about the estimated outstanding repair and maintenance bill for each women's prison for each year since 1985 and the actual spending at each prison in each of those years.

  Maintenance and repair expenditure at female establishments 1991–92 to 1995–96

  £000s

  1991–92

  1992–93

  1993–94

  1994–95

  11995–96

  Total

  Askham Grange

  91

  157

  113

  821

  120

  1,302

  Bullwood Hall

  439

  204

  181

  211

  283

  1,318

  Cookham Wood

  37

  56

  55

  341

  51

  540

  Drake Hall

  255

  130

  115

  206

  110

  816

  Durham2

  46

  857

  1,198

  166

  66

  2,333

  East Sutton Park

  29

  39

  70

  68

  77

  283

  Holloway

  350

  534

  784

  665

  715

  3,048

  Low Newton2

  62

  28

  45

  155

  40

  330

  Private Prisons
  Mr. George Howarth
  To ask the Secretary of State for the Home Department if he will give in respect of each private prison(a) the contractor, (b) the date the contract commenced, (c) the length of the contract, (d) the original contract price and (e) the projected cost of the contract including start-up costs and all other costs incurred by the Prison Service. [12768]

  Miss Widdecombe
  [holding answer 30 January 1996]: Responsibility for this matter has been delegated to the temporary Director General of the Prison Service, who has been asked to arrange for a reply to be given.

  Letter from Richard Tilt to Mr. George Howarth, dated 31 January 1996:
  The Home Secretary has asked me to reply to your recent Question about the contracts at each of the contractually managed prisons.
  The information about the projected cost of the contracts is not readily available in the form requested and I will write to you separately on this.
  The other information you requested is set out in the attached table.
  Records are not kept centrally of outstanding repair and maintenance bills for individual establishments.
  The attached table shows the actual annual spending on repairs and maintenance in the twelve establishments holding female prisoners in each of the financial years since 1991–92, including the predicted spend for this year. The figures include both work which has been funded centrally and that funded locally with delegated authority. Figures for actual expenditure on maintenance for the years 1985–86 to 1990–91 are not readily available.
  For the three establishments which currently house both male and female prisoners, it has not been possible to separate the costs for repair and maintenance of the female wings from the male wings.
  Much maintenance work is covered during modernisation and redevelopment. In 1994–95 such schemes helped take the investment 'in improvements alone to the prison estate to £178 million. Of this around £14 million was devoted to the female estate.
  We are in the process of re-surveying every establishment to produce a forward maintenance register which will be kept up to date and will help us predict future finance needed for maintenance.
  761

  Maintenance and repair expenditure at female establishments 1991–92 to 1995–96

  £000s

  1991–92

  1992–93

  1993–94

  1994–95

  11995–96

  Total

  New Hall

  106

  90

  111

  153

  182

  642

  Pucklechurch3

  26

  17

  58

  31

  20

  152

  Risley2

  218

  262

  312

  947

  465

  2,204

  Styal

  297

  560

  849

  326

  139

  2,171

  Total

  1,956

  2,934

  3,891

  4,090

  2,268

  15,139

  1Estimated outturn.

  2Establishments holding prisoners of both sexes. The costs relating to these establishments include an element for locally let maintenance and repair work for the entire prison, a figure which, unfortunately, cannot be easily apportioned between the female and male estate.

  1. Eastwood Park is scheduled to re-open during 1996 as a female establishment following a 2 year modernisation programme.

  2. Brockhill and Winchester have newly opened wings for female prisoners. These were modernised and will not yet have attracted significant spending on repair and maintenance.

  3. Pucklechurch is scheduled for closure during 1996 following the re-opening of Eastwood Park.

  Ms Jowell
  To ask the Secretary of State for the Home Department how many women were admitted to prison in each year since 1979; and what was(a) the total budget for women's prisons in each of those years and (b) the actual amount spent per prisoner.[11496]

  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 Alan Walker to Ms Tessa Jowell, dated 31 January 1996:
  The Home Secretary has asked me, in the absence of the Director General from the office, to reply to your recent Question about the number of women admitted to prison in each year since 1979, the total budget for women's prisons in each of those years and the actual amount spent per prisoner.
  Information on female receptions into Prison Service establishments in 1979–1993 is published in successive volumes of "Prison statistics, England and Wales" (tables 1.14 of the 1989 edition (Cm 1221) for years 1979–1989 and table 1.11 of the 1993 edition (Cm 2893) for the remaining years). Information for 1994 and 1995 is given in table 1.
  The only information readily available on the cost of women's prisons over the period requested is for total net operating costs and average annual net operating cost per inmate. The figures are set out in table 2. These figures cover only establishments exclusively for female inmates; costs for female are not available separately for establishments holding both males and females.

  Table 1: Female receptions1 into Prison Service establishments in England and Wales by type of custody, 1994 and 1995

  Year

  Typle of custody

  1994

  21995

  Remand

  Untried

  2,922

  2,940

  Convicted unsentenced

  1,812

  1,689

  Sentenced

  Immediate custody

  2,952

  3,467

  Fine defaulters

  1,454

  1,352

  Non-criminals

  290

  195

  1Total receptions cannot be calculated by adding together receptions in each category because there is double counting. A person received in more than one type of custody is counted each time.

  2Provisional figures.

  762

  Table 2: Costs of female establishments

  Financial year

  Net operating cost

  Average cost per inmate per year

  1979–80

  110,266

  18,569

  1980–81

  113,796

  111,207

  1981–82

  115,871

  113,753

  1982–83

  117,659

  116,054

  1983–84

  20,742

  17,228

  1984–85

  22,664

  18,902

  1985–86

  23,056

  17,942

  1986–87

  23,706

  17,891

  1987–88

  29,684

  20,003

  1988–89

  31,310

  20,763

  1989–90

  33,963

  22,567

  1990–91

  41,272

  29,250

  1991–92

  47,460

  32,708

  1992–93

  47,000

  34,207

  1993–94

  241,100

  228,151

  1994–95

  44,200

  226,675

  1The figures for 1979–80 to 1982–83 are not strictly comparable with subsequent years due to changes in accounting policies.

  2The figures for 1993–94 and 1994–95 are on a different basis to the preceding years which include some notional costs.

  Domestic Violence
  Ms Jowell
  To ask the Secretary of State for the Home Department what was the total amount spent by police force area on awareness campaigns on domestic violence for each year since 1990. [11495]

  Mr. Maclean
  This information is not collated centrally. Spending on domestic violence issues is an operational matter for chief officers of police.

  Ms Jowell
  To ask the Secretary of State for the Home Department what was the number of reported incidents of domestic violence by police force area for each year since 1990; and how many resulted in(a) prosecution and (b) conviction. [11497]

  Mr. Maclean
  Information is not available on the number of domestic violence incidents resulting in prosecution or conviction. Available statistics on the number of domestic violence incidents by police force area relate to the calendar year 1993 and the financial year 1994–95 and were provided in a reply I gave to the hon. Member for York (Mr. Bayley) on 7 November 1995, columns 823–24. Her Majesty's inspectorate of constabulary is in the process of collecting more reliable data.

  Prisons (Running Costs)
  Mr. George Howarth
  To ask the Secretary of State for the Home Department if he will place in the Library a copy of the recent report by LEK consultants, comparing the costs of running private prisons with public sector prisons. [12765]

  Miss Widdecombe
  [holding answer 30 January 1996]: Responsibility for this matter has been delegated to the temporary Director General of the Prison Service, who has been asked to arrange for a reply to be given.

  Letter from Richard Tilt to Mr. George Howarth, dated 31 January 1996:
  The Home Secretary has asked me to reply to your recent Question about the report by the LEK Partnership comparing the costs of running private prisons with public sector prisons.
  The study was carried out in 1994 and results presented to the Prison Service at the end of 1994. I cannot publish the study itself because it contains commercially confidential information. However, the attached table summarises the main findings.

  The LEK Partnership's study used data from 1993–94 and is summarised in the table below

  Private prison

  Public comparator group

  Cost1 per CNA lower by (per cent.)

  Blakenhurst

  Bullingdon

  14

  Holme House

  Elmley

  Doncaster2

  Bullingdon

  14

  Holme House

  Elmley

  Buckley Hall2

  Everthorpe

  26

  Haverigg

  Ranby

  1Cost is after adjustments to exclude non comparable costs from both the private sector bid prices and public sector costs.

  2Results for Doncaster and Buckley Hall should be treated with caution because neither prison was open during the period the comparisons covered.

  3The analysis excluded Wolds because in 1993–94 there was no comparable public sector remand prison.

  Police Custody (Deaths)
  Mr. Meacher
  To ask the Secretary of State for the Home Department on how many deaths in police custody in each year an inquest verdict has been brought in of(a) natural causes, (b) misadventure or accident, (c) drug addiction or alcoholism, (d) suicide, (e) unlawful killing and (f) open verdict; and in how many cases no inquest was held. [11931]

  Mr. Maclean
  The available information is published in the annual Home Office statistical bulletin entitled "Police Complaints and Discipline, England and Wales" and, for the Metropolitan police district, in the annual report of the Commissioner of Police. Copies of both publications are available in the Library.

  Ms Jowell
  To ask the Secretary of State for the Home Department how many people have died in police custody(a) in total and (b) by police force area in each year since 1990. [11487]
  764
  Mr. Maclean
  This information is published in the annual Home Office statistical bulletin entitled "Police Complaints and Discipline, England and Wales" and, for the Metropolitan police district, in the annual report of the Commissioner of Police. Copies of both publications are available in the Library.

  Ms Jowell
  To ask the Secretary of State for the Home Department what was the ethnic origin of each prisoner who has died in police custody since 1990. [11488]

  Mr. Maclean
  This information is not at present collected centrally but the present procedures are being amended as from April 1996. It will thereafter be published annually in the Home Office statistical bulletin entitled "Police Complaints and Discipline, England and Wales" and, for the Metropolitan police district, in the annual report of the Commissioner of Police.

  Control and Restraint Procedures
  Ms Jowell
  To ask the Secretary of State for the Home Department what guidance he has issued to police forces in the use of control and restraint procedures. [11489]

  Mr. Maclean
  Home Office circular—number 62/1992—deals with the use of handcuffs by police officers. The Association of Chief Police Officers issues, guidance on self-defence and restraint.

  Holloway Prison
  Ms Jowell
  To ask the Secretary of State for the Home Department what measures his Department will take to improve conditions at Holloway prison; and what extra resources will be made available for this. [11514]

  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 Tessa Jowell, dated 31 January 1996:
  The Home Secretary has asked me to reply to your recent Question about Holloway prison.
  A new governor has recently been appointed at Holloway prison and tasked with improving conditions there. As part of the improvement process, a new health care manager has been appointed, who is carrying out a full review of health care services at Holloway. Sixteen additional prison officers have also been drafted into Holloway from other prisons on a temporary basis.
  An additional £300,000 was provided to Holloway last October to recruit and train 25 additional new staff who will take up post in January and February this year, which will enable a fuller regime to operate in the prison.
  An external contractor, with expertise in pest control, is now working in Holloway and has made progress in eradicating rats and other vermin.

  Holloway Prison
  Mr. Corbyn
  To ask the Secretary of State for the Home Department what was(a) the maximum number of inmates permitted at Her Majesty's prison Holloway and (b) the highest prison population for each year since 1990. [12266]
  765
  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. Jeremy Corbyn, dated 31 January 1996:
  The Home Secretary has asked me to reply to your recent Question about Holloway prison.
  The maximum numbers of prisoners (the operational capacity) and the highest prison population for each year since 1990 is given in the attached table.

  Year

  Operational capacity

  Highest population

  1990

  517

  493

  1991

  517

  494

  1992

  517

  495

  1993

  532

  476

  1994

  532

  507

  1995

  532

  527

  Mr. Corbyn
  To ask the Secretary of State for the Home Department what allocation of funds for education at Her Majesty's prison Holloway he expects to make in 1996–97. [12268]

  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. Jeremy Corbyn, dated 31 January 1996:
  The Home Secretary has asked me to reply to your recent Question about the allocation of funds for education at Holloway prison in 1996–97.
  No decision has yet been made by the governor about how much of the 1996–97 budget should be allocation to education.

  Mr. Corbyn
  To ask the Secretary of State for the Home Department what representations he has received covering the provision of education in Her Majesty's prison Holloway; and if he will make a statement. [12271]

  Miss Widdecombe
  My right hon. and learned Friend and I have received representations from the board of visitors at Holloway on this matter. Her Majesty's chief inspector of prisons also raised his concerns with me and with the temporary Director General of the Prison Service following his unannounced visit to Holloway in December 1995.

  Crime Prevention
  Mr. Alex Carlile
  To ask the Secretary of State for the Home Department if he will list all programmes which his Department funds that are aimed at deterring under 16-year-olds from committing crimes; and if he will make a statement. [12723]

  Mr. Maclean
  The bulk of the Home Office funding in this area was transferred to the single regeneration budget at the Department of the Environment in April 1994. This budget supports many crime prevention activities with a youth focus. The Home Office programme development unit funded a small group of experimental projects on reducing criminality in 1992; final reports are expected shortly.

FOREIGN AND COMMONWEALTH AFFAIRS

  Former Yugoslavia
  Mr. Lidington
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the Government's policy on licensing arms exports to the states of the former Yugoslavia. [11993]

  Sir Nicholas Bonsor
  [holding answer 26 January 1996]: UN Security Council resolution 1021 established a timetable for phased lifting of the arms embargo on former Yugoslavia. Light weapons can be imported 90 days after signature of the peace agreement for Bosnia and Herzegovina—that is, from 13 March—and the embargo will be lifted completely 180 days after signature and after submission of a report from the UN Secretary General on the arms control negotiations called for in the peace agreement—that is from 11 June. The Government have decided that, taking into account the overall situation in the states of the former Yugoslavia and the paramount importance of ensuring the safety of British and other troops deployed in Bosnia and Herzegovina and Croatia, applications for arms export licences will be dealt with on the following basis:

  (a) for Slovenia and the former Yugoslav Republic of Macedonia, applications for licences to export military equipment listed in group 1 of part III of schedule I to the Export of Goods (Control) Order 1994 and dual-use goods will be considered on a case by case basis;

  (b) for Bosnia and Herzegovina, Croatia and the Federal Republic of Yugoslavia our policy is not to allow the export of military equipment listed in group 1 of part III of schedule 1 to the Export of Goods (Control) Order of 1994 during the period of the NATO-led implementation force's deployment. Against the background, applications for export licences will continue to be considered on a case by case basis, as will applications for export of dual-use goods.

  The Government will encourage our EU and other partners to take a similar approach, and keep this policy under review, particularly in the light of progress in implementing the peace agreement for Bosnia and Herzegovina.

  Laser Weapons Protocol
  Mr. Cohen
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the advantage of extending the scope of the laser weapons protocol to include civil war conflicts; what measures he proposes to improve the transparency and verification arrangements; and if he will make a statement. [12757]

  Mr. David Davis
  In common with other western countries, we support the extension of the scope of the 1981 UN weaponry convention protocols on both laser blinding weapons and land mines so that they apply also during non-international armed conflict. We also support the inclusion of effective transparency, compliance and verification arrangements. We shall pursue these questions at the concluding session of the weaponry convention review conference in Geneva from 22 April to 3 May.
  767
  Mr. Cohen
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will discuss with his Indian counterparts their policy towards the laser weapon protocol, with particular reference to its extension to cover civil war conflict; and if he will make a statement. [12758]

  Mr. Davis
  We intend to hold discussions with a number of countries before the final session of the 1981 UN weaponry convention review conference in Geneva from 22 April to 3 May with a view to securing the extension of the scope of the convention's protocols on land mines and laser building weapons to non-international armed conflict.

  Police Officers (Training)
  Mrs. Clwyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) if he will name the Guatemalan police officers who have been trained in Britain since 1985, specifying each officer's rank and the date of commencement and of completion of the training; [12517]

  (2) if he will name the Guatemalan police officers who have undergone study tours to the United Kingdom since 1985, in each case specifying the officer's rank and the date of commencement and of completion of the training. [12518]

  Sir Nicholas Bonsor
  I refer the hon. Member to the answer that I gave to the hon. Member for Stretford (Mr. Lloyd) on 27 November 1995,Official Report, column 429. We have no record of any Guatemalan police officers being trained or attending study tours in the United Kingdom since 1985. However, we have offered a place for one police officer to attend the overseas command course at Bramshill in 1996.

  Individual insolvencies in the United Kingdom

  Year

  England and Wales

  Scotland

  Northern Ireland

  Bankruptcy orders1

  Total2 individual insolvencies

  Sequestrations3

  Bankruptcies4

  Total personal insolvency orders5

  1985

  6,730

  6,778

  298

  150

  150

  1986

  7,093

  7,155

  437

  193

  193

  1987

  6,994

  7,427

  808

  134

  134

  1988

  7,717

  8,507

  1,401

  164

  164

  1989

  8,138

  9,365

  2,301

  238

  238

  1990

  12,058

  13,987

  4,350

  286

  286

  1991

  22,632

  25,640

  7,665

  367

  369

  1992

  32,106

  36,794

  10,845

  406

  448

  1993

  31,016

  36,703

  6,828

  474

  541

  1994

  25,634

  30,739

  2,182

  428

  512

  19956: Q1–Q37

  16,726

  20,044

  1,749

  306

  358

  Notes:

  1Figures for bankruptcy orders include administration orders, which are bankruptcy orders relating to the estate of a deceased debtor.

  2Total Individual Insolvencies in England and Wales comprise Bankruptcy orders, Individual voluntary arrangements and Deeds of arrangement.

  3Insolvent individuals in Scotland are subject to sequestration under the Bankruptcy (Scotland) Act 1985. The Bankruptcy (Scotland) Act 1993 amending the 1985 Act came into force on 1 April 1993 and will have affected the number of sequestrations in the Scottish Courts.

  4NI Bankruptcies comprise Bankruptcy adjudication orders, Arrangement protection orders and Orders for the administration of estates of deceased insolvents.

  5NI Total comprises Bankruptcies and Individual voluntary arrangements.

  6Data for 1995 will be published (for England and Wales, and Scotland) on 2 February 1996.

  7Provisional.

  Sources:

  DTI and Northern Ireland Insolvency Service.

  Test Ban Treaty
  Mr. Llew Smith
  To ask the Secretary of State for Foreign and Commonwealth Affairs what proposals have been put by the United Kingdom to the negotiations on a comprehensive nuclear test ban treaty. [12860]

  Mr. David Davis
  We continue to negotiate actively for the earliest possible conclusion of an effective comprehensive test ban treaty. We have made it clear that in our view such a treaty should prohibit all nuclear weapon test explosions involving any release of nuclear energy.

  Burundi
  Mr. Tony Lloyd
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the situation in Burundi; and what steps he has taken with the international community to prevent a further escalation of ethnic violence in Burundi and to support the legitimate Government. [12233]

  Mr. Hanley
  We are seriously concerned about the deterioration of the political and security situation in Burundi. We continue to support efforts by the United Nations, the Organisation of African Unity and leaders in the region to promote political dialogue, reduce violence and ensure humanitarian assistance reaches those in need.

TRADE AND INDUSTRY

  Bankruptcy Orders
  Mr. Steinberg
  To ask the President of the Board of Trade how many bankruptcy orders were made in each region in the last 10 years. [9267]

  Mr. Oppenheim
  The information is given in the table.
  769
  The Insolvency Act 1986 introduced a number of changes which streamlined overall procedures. For individuals, the terms under which one can seek bankruptcy were made more lenient and many discharges were made automatic after three years. The total number of insolvencies must be considered in the context of about 3.6 million UK businesses in total and a start-up rate of about 400,000 new businesses per year. Since 1986, the number of UK enterprises has increased by over 12 per cent. and the number of self-employed by 21 per cent., concentrated mainly in the earlier years.

  Scott Inquiry
  Mr. Kirkwood
  To ask the President of the Board of Trade when he intends to publish the Scott inquiry report; and if he will make a statement. [11643]

  Mr. Lang
  [holding answer 24 January 1996]: I expect the report to be published within the next few weeks.

  Jordan (Export Credits)
  Mr. Meacher
  To ask the President of the Board of Trade what has been the total principal value of payments made by the Export Credits Guarantee Department to the Midland bank since 1980 in respect of trade with Jordan by(a) Astra Holdings and its subsidiaries, (b) British Aerospace and its subsidiaries, (c) Royal Ordnance and its subsidiaries, (d) Vickers and its subsidiaries, (e) Racal and its subsidiaries, (f) Plessey and its subsidiaries and (g) Thorn EMI and it subsidiaries. [11307]

  Mr. Nelson
  [holding answer 24 January 1996]: The ECGD has no record of payments to Midland bank since 1980 in respect of capital goods and project business with Jordan by any of the named companies. The ECGD has, however, paid £11.2 million claims to Midland bank in respect of business by Airbus Industrie, to which British Aerospace is a supplier. In the case of its now-privatised short-term business the ECGD maintains no record of the supplier in cases where it has paid claims to banks.

  Trade Missions (Burma and Nigeria)
  Mr. Tony Lloyd
  To ask the President of the Board of Trade if he will list the trade missions to(a) Burma and (b) Nigeria over the last five years which have been sponsored by his Department and organised in conjunction with his Department; how many are planned; and if he will list the companies involved. [12238]

  Mr. Oppenheim
  (a) There have been no Department of Trade and Industry-supported trade missions to Burma in the last five years. The Department is supporting two missions in 1996:

  (1) an Asia Pacific Advisory Group trade mission, 26 February-1 March 1996,
  and

  (2) a British Electrochemical and Allied Manufacturers' Association (BEAMA) trade mission to Thailand and Burma, 24 June-3 July 1996.

  (b) Since 1991, there have been 15 Department of Trade and Industry-supported trade missions to Nigeria:

  (1) April 1991—Leicestershire Chamber of Commerce and Industry

  (2) August 1991—Birmingham Chamber of Commerce and Industry

  770

  (3) October 1991—London Chamber of Commerce and Industry

  (4) March 1992—Energy Industries Council

  (5) May 1992—Leicestershire Chamber of Commerce and Industry

  (6) September 1992—Birmingham Chamber of Commerce and Industry

  (7) October 1992—British Electrochemical and Allied Manufacturers' Association (BEAMA)

  (8) April 1993—Leicestershire Chamber of Commerce and Industry

  (9) June 1993—Bristol Chamber of Commerce and Industry

  (10) January 1994—London Chamber of Commerce and Industry

  (11) September 1994—Birmingham Chamber of Commerce and Industry

  (12) January 1995—British Electrochemical and Allied Manufacturers' Association (BEAMA)

  (13) May 1995—Birmingham Chamber of Commerce and Industry

  (14) May 1995—DTI Nigeria desk-organised water trade mission

  (15) September 1995—Birmingham Chamber of Commerce and Industry

  Several of these missions also visited Ghana.

  The Department of Trade and Industry has undertaken to support two missions in 1996:

  (1) a London Chamber of Commerce mission to Nigeria and Ghana, 25 February-15 March, and

  (2) a Kent Chamber of Commerce mission to Nigeria and Ghana, 17–30 November.

  Nuclear Powers
  Mr. Battle
  To ask the President of the Board of Trade what was the total value to the British nuclear generation industry in 1995 prices of the price support mechanism for the sale of electricity generated from nuclear power in each year from 1980 to 1990. [12475]

  Mr. Eggar
  Before 1990, the Central Electricity Generating Board and the South of Scotland Electricity Board were responsible for most nuclear generation in the UK. The accounts of those companies did not separately identify detailed financial information on nuclear generation.

  Nuclear Levy
  Mr. Battle
  To ask the President of the Board of Trade how much money in 1995 prices it is expected will be raised from the nuclear levy from the present day until the removal of the levy.[12478]

  Mr. Eggar
  The element of the fossil fuel levy that is attributable to Nuclear Electric will end at the time of privatisation, subject to the recovery of outstanding moneys due. It is not possible at this time to estimate the amount of money that will be raised in respect of this element from the present day, as this will depend on a number of factors that are still uncertain.

  British Coal Pensions
  Mrs. Clwyd
  To ask the President of the Board of Trade what changes have occurred in the respect of British Coal pensions funding arrangements between the
  771
  publication of his Department's paper on proposals for British Coal pensions after privatisation and his answer of 24 October, Official Report, column 553. [12736]

  Mr. Page
  Following the publication in September 1993 of the Government's proposals for British Coal pensions after privatisation, a number of changes took place to the arrangements governing the mineworkers pension scheme and the British Coal staff superannuation scheme. The modified arrangements took effect from 31 October 1994 and were described in some detail by my right hon. Friend the Minister of State for Industry and Energy, in his answer of 27 April 1994,Official Report, column 168. My answer of 24 October 1995 concerned the unrelated issue of British Coal's industrial death and retirement scheme.

  Characterr Ceramics, Falmouth
  Mr. Jamieson
  To ask the President of the Board of Trade what inquiries his Department undertook into the background of the directors of Character Ceramics, Falmouth, before making them a grant. [10111]

  Mr. Oppenheim
  [holding answer 18 January 1996]: No inquiries were made. The Department considers making checks where the circumstances suggest that it would be appropriate to do so.

ATTORNEY-GENERAL

  Positive about Disabled People Symbol
  Mr. Barnes
  To ask the Attorney-General if he will list for his Department and each of the agencies for which he is responsible if it uses the Employment Service's positive about disabled people symbol for(a) external recruitment and (b) internal recruitment and promotion. [11925]

  The Attorney-General
  All the Law Officers' Departments seek to ensure that there is no unfair discrimination on the basis of disability. Although those Departments do not at present use the positive about disabled people symbol, the Crown Prosecution Service proposes to apply shortly for use of the symbol in relation to both(a) external recruitment and (b) internal recruitment and promotion. The Government property lawyers have undertaken preparatory work with a view to applying for use of the symbol in the near future, and the Treasury Solicitor's Department is also considering its use.

  "Despatches" Programme
  Mrs., Clwyd
  To ask the Attorney-General if the inquiries by the Ministry of Defence police and Strathclyde police into allegations made in the "Despatches" programme are complete. [12729]

  The Attorney-General
  The Crown Prosecution Service has received a report from the Ministry of Defence police and is awaiting the outcome of further investigations being carried out by Strathclyde police. The conduct and progress of those investigations are matters for my noble and learned Friend the Lord Advocate.

PRIME MINISTER

  Absenteeism
  Mr Malcolm Bruce
  To ask the Prime Minister what estimate he has made of absenteeism rates in days per annum for staff in his Department for each of the years(a) 1979–80, (b) 1989–90, (c) 1991–92, (d) 1993–94, (e) 1994–95 and (f) 1995–96. [11365]

  The Prime Minister
  [holding answer 25 January 1996]: I refer the hon. Member to the reply given by my hon. Friend the Parliamentary Secretary, Office of Public Service, on Tuesday 30 January.

  Departmental Expenditure
  Mr. Malcolm Bruce
  To ask the Prime Minister what is his estimate of his Department's expenditure on newspapers and magazines in(a) 1993–94, (b) 1994–95 and (c) 1995–96, to date; and if he will list the publications purchased for the latest year for which information is available. [11457]

  The Prime Minister
  [holding answer 30 January 1996]: For this purpose, my office is part of the Cabinet Office. I refer the hon. Member to the reply given on 30 January by my hon. Friend the Parliamentary Secretary, Office of Public Service. Figures for 1979–80 are not available on a comparable basis.

  Nuclear Testing (India)
  Mr. Redmond
  To ask the Prime Minister what action he is taking in respect of the Indian Government's plans to resume nuclear testing; and if he will make a statement. [12873]

  The Prime Minister
  The Indian Minister for External Affairs confirmed in Delhi on 19 December that India was not planning to conduct a nuclear test. We have welcomed this assurance.

OVERSEAS DEVELOPMENT ADMINISTRATION

  Joint Funding Scheme
  Miss Lestor
  To ask the Secretary of State for Foreign and Commonwealth Affairs what changes are proposed for the criteria for joint funding scheme project selection; and if he will make a statement. [12256]

  Mr. Hanley
  Any changes to the criteria for the selection of projects under the joint funding scheme will be considered in the context of a forthcoming general
  773
  review by the ODA of our relationships with non-governmental organisations. At this point, we do not envisage any substantial change, particularly to the primary objective of the scheme, which is to bring lasting benefits to the poorest people in developing countries. NGOs will be fully consulted in our review of these arrangements.

AGRICULTURE, FISHERIES AND FOOD

  Agricultural Incomes
  Sir John Cope
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement on agricultural and farm incomes. [13226]

  Mr. Douglas Hogg
  Total income from farming is estimated to have risen by 22 per cent. in real terms in 1995 compared with 1994. This increase is partly due to agrimonetary developments and to unusual weather conditions which, on balance, had a favourable effect on agricultural incomes. However, the Government's success in creating the right conditions for growth also played an important part. Detailed estimates of the income, output and productivity of United Kingdom agriculture in 1995 were published this morning and have been placed in the Library of the House.

  Fish Farming
  Mr. Peter Robinson
  To ask the Minister of Agriculture, Fisheries and Food how many fish farms throughout Northern Ireland have been granted exemption permits; what are the conditions of exemptions; and on what dates they were signed. [10669]

  Mr. Ancram
  I have been asked to reply.

  A total of six fish farms in Northern Ireland have been granted permits exempting them from the obligations imposed by section 59 of the Fisheries Act (Northern Ireland) 1966, as amended. Conditions vary on each exemption issued and are site specific, but the underlying principle is that exemptions are issued subject to conditions which result in no diminution of the level of protection afforded to fish stocks. The dates of issue of the permits were 12 September 1994,3 April 1995,2 May 1995,16 May 1995—two—and 1 August 1995.

  Mr. Robinson
  To ask the Minister of Agriculture, Fisheries and Food how many fish farms in Northern Ireland were identified by the Fisheries Conservatory Board as not complying with the provisions contained in the Fisheries Act in each of the past two years. [10670]

  Mr. Ancram
  I have been asked to reply.

  The information is as follows:

  1994: 8

  1995: 2

  Abattoirs
  Mr. Gill
  To ask the Minister of Agriculture, Fisheries and Food how many abattoirs continue to operate either as(a) fully EC approved and (b) under temporary derogation; and by how much the overall total differs from December 1995. [10420]
  774
  Mrs. Browning
  The information for red meat abattoirs in England is set out in the table:

  Licence status

  Number of premises 1 December 1995

  Number of premises 19 January 1996

  EC approved

  101

  113

  National market only

  Permanently derogated low

  throughput (no more than 20

  livestock units per week)

  119

  140

  Temporary derogated full

  throughput (more than 20

  livestock units per week)

  122

  107

  Temporary derogated low

  throughput (no more than 20

  livestock units per week)

  60

  41

  Total

  402

  401

  Departmental Chauffeur-driven Cars
  Mr. MacShane
  To ask the Minister of Agriculture, Fisheries and Food what the cost of chauffeur-driven cars used by his Department was in each of the past five years. [5854]

  Mr. Douglas Hogg
  Expenditure by the Ministry of Agriculture, Fisheries and Food in respect of chauffeur-driven cars for the financial years 1990–91 to 1994–95 is set out in the list.

  1990–91: £234,430.21

  1991–92: £289,972.83

  1992–93: £294,921.47

  1993–94: £264,662.21

  1994–95: £223,697.49

  Departmental Property
  Mr. Malcolm Bruce
  To ask the Minister of Agriculture, Fisheries and Food what is his estimate of the annual cost to his Ministry and his Ministry's agencies and non-ministerial public bodies of their empty and under-utilised properties for(a) 1979–80, (b) 1989–90, (c) 1991–92, (d) 1993–94, (e) 1994–95, (f) 1995–96 and (g) 1996–97. [11415]

  Mr. Boswell
  [holding answer 30 January 1996]: Before 1 April 1990, the civil estate was managed by the Property Services Agency.

  The annual costs incurred by the Ministry and its agencies in respect of empty properties are as follows:

  1991–92: £320,000

  1992–93: £944,000

  1993–94: £1,803,000

  1994–95: £4,471,000

  1995–96: £4,258,000

  1996–97: £2,744,000

  Information on the costs of the Ministry's under-utilised properties and on the costs of empty and under-utilised properties held by non-departmental public bodies could be obtained only at disproportionate cost.
  775
  A significant proportion of each of the above figures relates to opportunity cost rents which are not a charge on the Exchequer.

  The Ministry follows Treasury policy and makes every effort to dispose of vacant properties within three years of their becoming redundant.

  Departmental Expenditure
  Mr. Malcolm Bruce
  To ask the Minister of Agriculture, Fisheries and Food what is his estimate of his Ministry's expenditure on newspapers and magazines in(a) 1993–94, (b) 1994–95 and (c) 1995–96, to date; and if he will list the publications purchased for the latest year for which information is available. [11417]

  Mr. Douglas Hogg
  [holding answer 30 January 1996]: The Ministry of Agriculture, Fisheries and Food's estimated expenditure over the past three years on newspapers and magazines, defined as scientific, technical and other highly specialised and general periodicals, is as follows:

  1993–94: £624,000

  1994–95: £623,000

  1995–96: £481,000

  The Ministry subscribes centrally to over 3,500 titles, and other records are maintained at a number of different locations. To provide a central list of publications purchased for the latest year for which information is available could be done only at disproportionate cost.

  EU Funding
  Mr. Hain
  To ask the Minister of Agriculture, Fisheries and Food how much in(a) ecu and (b) pounds by standard region and in total is allocated to the United Kingdom from the European agricultural guidance and guarantee fund under the present structural funds agreement.

  [11655]

  Mr. Boswell
  [holding answer 29 January 1996]: The UK's allocation by objective and region in (a) ecu and (b) pounds sterling from the European agricultural guidance and guarantee fund under the present structural funds agreement—1994 to 1999—is shown in the table:

  Region

  Ecus

  Pounds sterling

  Objective 1

  Merseyside

  3

  3

  Highlands and Islands

  56

  47

  Northern Ireland

  187

  158

  Total UK

  246

  205

  Objective 5a

  UK

  361

  301

  Objective 5b

  South-West

  41

  34

  The Marches

  7

  6

  Midlands Uplands

  2

  2

  Northern Uplands

  23

  19

  Lincolnshire

  9

  8

  East Anglia

  11

  9

  Rural Wales

  36

  30

  Borders of Scotland

  4

  3

  Dumfries and Galloway

  6

  5

  Central Scotland/Tayside

  3

  3

  776

  Region

  Ecus

  Pounds sterling

  Grampian

  5

  4

  Total UK

  147

  123

  1. All figures are at 1994 prices, are given in millions and have been rounded to the nearest million.

  2. The exchange rate used is £1 = 1.20 ecu.

  Cattle
  Dr. Strang
  To ask the Minister of Agriculture, Fisheries and Food if he will list the size of the herd of each breed of cattle in the United Kingdom, for each year since 1985. [12178]

  Mr. Douglas Hogg
  The Ministry does not hold the information requested.

  Live Animal Exports
  Mr. Heppell
  To ask the Minister of Agriculture, Fisheries and Food (1) what requirements are made of vehicles seeking exemption licences to carry animals in more than one tier on roll-on, roll-off ferries; [11980]

  (2) how many vehicles have been approved for the, transport of animals on the open decks of ferries in the last 12 months. [11982]

  Mrs. Browning
  The issue of exemption licences for vehicles carried on roll-on, roll-off ferries ceased as from 1 January 1993. There are no provisions requiring approval of vehicles carried on the open deck of ferries.

  Mr. Heppell
  To ask the Minister of Agriculture, Fisheries and Food if he will list the orders and regulations governing the suitability of(a) vessels and (b) vehicles for the transport of livestock. [11981]

  Mrs. Browning
  The following orders, made or deemed to have been made, under the Animal Health Act 1981, contain provisions governing the suitability of(a) vessels and (b) vehicles:

  Statutory Instrument

  Reference

  The Transit of Animals Order

  S.R. and O. 1927/289(S.R.

  1927 (as amended by the

  and O. 1927/399,

  Transit of Animals

  1939/501,S.I.

  (Amendment) Orders 1927 and

  1975/1025S.I. 1992/3304)

  1939, the Transit of Animals

  (Road and Rail) Order 1975)

  and the Welfare of Animals

  during Transport Order 1992)

  The Animals (Sea Transport)

  S.R. and O. 1930/923(S.R.

  Order 1930 (as amended by the

  and O. 1932/248S.I.

  Animals (Sea Transport)

  1992/3304)

  (Amendment) Order 1932 and

  the Welfare of Animals during

  Transport Order 1992)

  The Horses (Sea Transport) Order

  S.I. 1952/1291(S.I.

  1952 (as amended by the

  1958/1272S.I. 1992/3304)

  Horses (Sea Transport)

  Amendment Order 1958 and

  the Welfare of Animals during

  Transport Order 1992)

  777

  Statutory Instrument

  Reference

  The Transit of Animals(General)

  S.I. 1973/1377(S.I.

  Order 1973 as amended by the

  1988/815S.I. 1992/3304)

  Transit of Animals

  (Amendment) Order 1988 and

  The Welfare of Animals during

  Transport Order 1992)

  The Transit of Animals (Road and

  S.I. 1975/1024(S.I.

  Rail) Order 1975 (as amended

  1979)1013)(S.I.

  by the Transit of Animals

  1988/815S.I. 1992/3304)

  (Road and Rail) (Amendment)

  Order 1979, the Transit of

  Animals (Amendment) Order

  1988) and the Welfare of

  Animals during Transport

  Order 1992)

  The Welfare of Poultry Order

  S.I. 1988/851(S.I. 1989/52S.I.

  1988 (as amended by the

  1992/3304)

  Welfare of Poultry (Transport)

  (Amendment) Order 1989 and

  the Welfare of Animals during

  Transport Order 1992)

  The Welfare of Animals during

  Transport Order 1994 (as

  amended by the Welfare of

  Animals during Transport

  (Amendment) Order 1995)S.I.

  1994/3249(1995/131)

  Mr. Morley
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the adequacy of-his Department's budgetary provision for the financial year 1996–97 to allow for his officials to be able to monitor at Dover docks each vehicle exporting livestock which intends to embark on specialist livestock ferries sailing from Dover; and if he will make a statement. [12165]

  Mrs. Browning
  [holding answer 29 January 1996]: Monitoring the conditions under which livestock are exported will continue to be a priority task for the Department.

  European Directives
  Mr. Steen
  To ask the Minister of Agriculture, Fisheries and Food (1) if he will make a statement on internal procedures which have been put in place to ensure that European directives are not gold plated in domestic regulations in his Department; and how, when and by whom these procedures will be activated; [12260]

  (2) if he will place in the Library copies of the guidance notes, office notes and other relevant documents which relate to the new internal procedures for (a) removing gold plating from existing domestic regulation and (b) ensuring new European directives are not gold plated. [12263]

  Mr. Boswell
  [holding answer 30 January 1996]: The Ministry's firm policy is not to gold plate EC directives when implementing them in the UK by the addition of unnecessary burdens. Detailed and comprehensive procedures have been devised to help our close scrutiny of proposals to implement new EU directives to ensure these ends. We do not feel it appropriate to publish this internal departmental guidance. There is also close
  778
  consultation with other Departments on the further development of means to satisfy ourselves that no gold plating is taking place.

  Mr. Steen
  To ask the Minister of Agriculture, Fisheries and Food, pursuant to his answer of 19 December 1995,Official Report, column 1134, in what circumstances overwhelming policy reasons have amplified minimum regulatory standards when translating European directives into United Kingdom law; and if he will make a statement. [12261]

  Mr. Boswell
  [holding answer 30 January 1996]: The cost of analysing all past statutory instruments, in order to identify those which may have amplified minimum regulatory standards, would be disproportionate.

  Milk Quotas
  Mr. Wigley
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the benefits of granting compensation for purchasers of milk quotas in the event of the discontinuance of the scheme. [12488]

  Mr. Baldry
  Current EC legislation provides for milk quotas until 31 March 2000. The future of the milk quota system will be reviewed in Brussels before then and the Government will be assessing the options for reforming the present arrangements in the context of that review.

  Equidae (Registration)
  Mr. Morley
  To ask the Minister of Agriculture, Fisheries and Food how many equidae within the meaning of directive 90/426/EEC have been registered in Britain by organisations which have been formally recognised under the terms of that directive to register equidae. [12638]

  Mrs. Browning
  I regret that registration records are not held by this Department. Information may be available from the 37 societies that have so far been recognised, as referred to in my reply,Official Report, columns 627–28, on 17 January 1996.

EDUCATION AND EMPLOYMENT

  Selective Education
  Mr. French
  To ask the Secretary of State for Education and Employment what data her Department has assessed in respect of the percentage of adults who favour a return to fully selective education. [12737]

  Mrs. Gillan
  A recent survey commissioned by the Association of Teachers and Lecturers found that 54 per cent. of parents were in favour of a return to a fully selective education system.

  Further Education Funding Council
  Ms Eagle
  To ask the Secretary of State for Education and Employment what amount of funding allocated by the Further Education Council is spent on subsidising employer training broken down by further education institution. [12756]

  Mr. Paice
  The information is not collected centrally.
  779
  Ms Eagle
  To ask the Secretary of State for Education and Employment how many applications have been received by the Further Education Funding Council from private training institutions applying to register as further education colleges; and if she will list them. [12754]

  Mr. Paice
  There is no provision for the registration of private training institutions as further education colleges. The Further and Higher Education Act 1992 makes provision for my right hon. Friend to establish further education corporations to conduct existing educational institutions. She would normally expect to do so only in response to a proposal made by the Further Education Funding Council for England. To date, the council has not received any requests to make such proposals to my right hon. Friend.

  The Act also includes provision for institutions which are inside the further education sector to sponsor for funding from the council applications from institutions which are outside the sector. In 1994–95 the FEFC received 41 applications for such funding from external institutions. Of these 18 were private providers and 11 of these received funding. In 1995–96, nine applications were received, five from private providers, and one of these received funding. At this stage, the indications for 1996–97 are: seven received, five from private providers; funding has yet to be allocated. I will ask the chief executive of the council to write with a list of the institutions concerned.

  Grant-maintained Schools
  Mr. Hall
  To ask the Secretary of State for Education and Employment how many of the schools in England which have balloted parents on the question of grant-maintained status since 1 July 1995 voted in favour of staying with their local education authority. [12595]

  Mrs. Gillan
  Twenty-four primary and secondary schools in England have voted not to seek grant-maintained status between 1 July 1995 and 26 January 1996.

  Ofsted Inspections (Costs)
  Mr. Cohen
  To ask the Secretary of State for Education and Employment (1) what estimate she has made of the cost of a full Ofsted inspection in a London borough; [12866]

  (2) what is the estimated total cost of the Ofsted inspection and report in respect of Waltham Forest. [12857]

  Mr. Robin Squire
  These are matters for Her Majesty's chief inspector of schools, who heads the Office for Standards in Education. I have asked Mr. Chris Woodhead to write to the hon. Member.

  School Inspections (Bradford)
  Mr. Madden
  To ask the Secretary of State for Education and Employment if she will list(a) the names of schools in the Manningharn area of Bradford which are to be inspected by the Office for Standards in Education, (b) the dates during which inspections are to be made, (c) the dates on which inspection contracts were approved and (d) the date by when Ofsted will report the outcome of the inspections; and if she will make a statement. [12881]
  780
  Mr. Robin Squire
  This is a matter for Her Majesty's Chief Inspector of Schools, who heads the Office for Standards in Education. I have asked Mr. Chris Woodhead to write to the hon. Member.

  Teachers
  Mr. Byers
  To ask the Secretary of State for Education and Employment if she will list for each local education authority the number of full-time equivalent teachers employed in(a) January 1991 and (b) January 1995 excluding sixth form colleges. [12882]

  Mr. Robin Squire
  The following table shows the full-time equivalent number of teachers employed in the maintained nursery, primary and secondary sector in England for January for 1991 and 1995.

  Full-time equivalent teachers employed by local education authorities and grant-maintained schools in the nursery, primary and secondary sector1

  January each year

  1991

  1995

  Local education authority area

  All schools

  All schools

  Corporation of London

  14

  16

  Camden

  1,196

  1,346

  Greenwich

  2,196

  1,939

  Hackney

  1,715

  1,429

  Hammersmith and Fulham

  1,045

  941

  Islington

  1,310

  1,360

  Kensington and Chelsea

  663

  674

  Lambeth

  1,453

  1,680

  Lewisham

  1,818

  1,863

  Southwark

  1,714

  1,687

  Tower Hamlets

  2,115

  2,250

  Wandsworth

  1,667

  1,561

  Westminster

  1,154

  1,121

  Barking and Dagenham

  1,267

  1,446

  Barnet

  2,366

  2,638

  Bexley

  1,745

  1,836

  Brent

  2,023

  1,971

  Bromley

  1,958

  2,181

  Croydon

  2,424

  2,409

  Ealing

  2,202

  2,097

  Enfield

  2,264

  2,358

  Haringey

  1,553

  1,730

  Harrow

  1,414

  1,576

  Havering

  2,011

  1,891

  Hillingdon

  1,754

  1,870

  Hounslow ,

  1,928

  1,890

  Kingston upon Thames

  1,035

  1,057

  Merton

  1,275

  1,269

  Newham

  2,070

  1,968

  Redbridge

  1,698

  1,937

  Richmond upon Thames

  1,016

  1,052

  Sutton

  1,345

  1,354

  Waltham Forest

  1,809

  1,706

  Birmingham

  8,885

  9,366

  Coventry

  2,745

  2,657

  Dudley

  2,656

  2,576

  Sandwell

  2,865

  2,689

  Solihull

  1,757

  1,845

  Walsall

  2,744

  2,560

  Wolverhampton

  2,582

  2,377

  Knowsley

  1,481

  1,446

  Liverpool

  4,470

  4,194

  St. Helens

  1,658

  1,635

  Sefton

  2,391

  2,546

  Wirral

  3,038

  2,927

  Bolton

  2,463

  2,467

  781

  Full-time equivalent teachers employed by local education authorities and grant-maintained schools in the nursery, primary and secondary sector1

  January each year

  1991

  1995

  Local education authority area

  All schools

  All schools

  Bury

  1,441

  1,420

  Manchester

  4,004

  3,587

  Oldham

  2,196

  2,202

  Rochdale

  1,934

  1,819

  Salford

  2,002

  1,821

  Stockport

  2,159

  2,185

  Tameside

  1,929

  1,842

  Trafford

  1,763

  1,694

  Wigan

  2,835

  2,754

  Barnsley

  1,760

  1,704

  Doncaster

  2,753

  2,703

  Rotherham

  2,469

  2,440

  Sheffield

  4,043

  3,719

  Bradford

  5,012

  4,779

  Calderdale

  1,791

  1,769

  Kirklees

  3,580

  3,373

  Leeds

  6,275

  5,759

  Wakefield

  2,865

  2,704

  Gateshead

  1,750

  1,715

  Newcastle upon Tyne

  2,346

  2,104

  North Tyneside

  1,776

  1,639

  South Tyneside

  1,410

  1,340

  Sunderland

  2,681

  2,728

  Isles of Scilly

  29

  26

  Avon

  7,334

  7,677

  Bedfordshire

  4,799

  5,008

  Berkshire

  5,892

  6,171

  Buckinghamshire

  5,136

  5,310

  Cambridge

  5,244

  5,573

  Cheshire

  7,800

  8,013

  Cleveland

  5,180

  5,189

  Cornwall

  3,711

  3,675

  Cumbria

  4,147

  4,016

  Derbyshire

  8,490

  7,555

  Devon

  7,133

  7,437

  Dorset

  4,476

  4,393

  Durham

  4,783

  5,117

  East Sussex

  4,321

  4,899

  Essex

  11,985

  11,771

  Gloucestershire

  4,349

  4,258

  Hampshire

  10,680

  11,871

  Hereford and Worcester

  5,311

  5,329

  Hertfordshire

  8,248

  8,725

  Humberside

  7,470

  7,394

  Isle of Wight

  1,008

  999

  Kent

  11,674

  12,552

  Lancashire

  11,590

  12,088

  Leicestershire

  7,536

  7,810

  Lincolnshire

  4,869

  4,877

  Norfolk

  5,497

  5,898

  North Yorkshire

  5,537

  5,774

  Northamptonshire

  5,337

  5,624

  Northumberland

  2,736

  2,672

  Nottinghamshire

  8,246

  8,354

  Oxfordshire

  4,042

  4,426

  Shropshire

  3,477

  3,384

  Somerset

  3,533

  3,665

  Staffordshire

  8,758

  8,245

  Suffolk

  4,949

  5,466

  Surrey

  6,265

  6,529

  Warwickshire

  3,943

  4,027

  West Sussex

  4,663

  5,230

  Wiltshire

  4,513

  4,698

  England

  388,414

  392,910

ENVIRONMENT

  Housing Stock (London)
  Mrs. Bridget Prentice
  To ask the Secretary of State for the Environment if he will list the current housing stock in each London borough in the(a) private rented, (b) council owned and (c) housing association categories. [10888]

  Mr. Clappison
  The number of local authority and housing association dwellings in each London borough on 1 April 1995 reported by local authorities on their 1995 housing investment programme—HIP1—returns, were as follows.

  Local authority(1)

  Housing association

  Barking and Dagenham

  26,648

  596

  Barnet

  13,242

  4,100

  Bexley

  8,673

  2,890

  Brent

  16,673

  9,076

  Bromley

  80

  17,849

  Camden

  29,789

  6,520

  City of London

  2,256

  195

  Croydon

  16,393

  6,655

  Ealing

  16,204

  6,517

  Enfield

  15,558

  2,857

  Greenwich

  32,297

  5,443

  Hackney

  39,560

  10,552

  Hammersmith and Fulham

  16,417

  8,977

  Harringey

  20,842

  7,687

  Harrow

  6,551

  1,533

  Havering

  13,302

  1,332

  Hillingdon

  12,881

  4,151

  Hounslow

  16,476

  4,044

  Islington

  37,045

  8,363

  Kensington and Chelsea

  7,958

  11,007

  Kingston upon Thames

  5,548

  1,254

  Lambeth

  43,068

  11,275

  Lewisham

  35,095

  7,500

  Merton

  9,458

  2,500

  Newham

  25,818

  7,730

  Redbridge

  6,761

  2,131

  Richmond upon Thames

  7,703

  2,786

  Southwark

  54,266

  9,801

  Sutton

  10,038

  2,538

  Tower Hamlets

  37,578

  7,200

  Waltham Forest

  16,179

  4,166

  Wandsworth

  21,522

  9,139

  Westminster

  15,701

  12,143

  London total

  637,580

  200,507

  (1) Includes any dwelling owned by the authority outside its own area.

  Corresponding figures for private rented stock are not available; data are collected from local authorities on total private sector stock, but this is not split between owner-occupied and rented dwellings.

  Local Government Finance
  Mr. Pike
  To ask the Secretary of State for the Environment if he will list for each local authority in England for each year from 1991 to 1996–97 in cash and real terms the amount of (i) revenue support grant and (ii) capital expenditure. [11597]

  Sir Paul Beresford
  A list of revenue support grant and capital expenditure for each local authority in England has been placed in the Library of the House.
  783
  Dr. Spink
  To ask the Secretary of State for the Environment when he expects to announce the outcome of consultation on the local government finance settlement, and if he will make a statement. [12731]

  Sir Paul Beresford
  [pursuant to his reply, 29 January 1996, c. 576]: I regret that certain sub-totals were incorrect on the first page of the table, "1996–97 Standard Spending Assessments, Business Rates, Revenue Support Grant and Special Grant Entitlements", copies of which were placed in the Library and the Vote Office on 29 January. The line "Total England" in the table, and the figures for individual local authorities, are unchanged.

  A revised table has now been placed in the Library. Copies are available in the Vote Office.

  Mr. David Nicholson
  To ask the Secretary of State for the Environment if he will publish the proposed or actual total external support in 1992–93, 1993–94, 1994–95, 1995–96 and 1996–97 for each of the districts in Somerset and Devon, with an explanation of any significant changes of function affecting grant. [11828]

  Sir Paul Beresford
  The information is given in the following table.

  Under the system in operation in 1992–93, total external support for principal authorities in both tiers of local government was paid to district councils: counties precepted on districts for their share. From 1993–94, each principal authority has been paid its share of TES direct.

  Total external support (revenue support grant + income from non-domestic rates + damping grants)

  £ million

  Local authority

  1992–93

  1993–94

  1994–95

  1995–96

  1996–97

  East Devon

  57.665

  6.227

  6.826

  6.718

  6.648

  Exeter

  50.506

  8.253

  8.601

  8.425

  8.353

  North Devon

  43.102

  6.307

  6.531

  6.627

  6.668

  Plymouth

  130.640

  24.443

  24.514

  24.012

  22.604

  South Hams

  38.536

  4.613

  4.864

  4.764

  4.471

  Teignbridge

  53.749

  6.595

  7.250

  7.254

  7.169

  Mid Devon

  31.387

  4.340

  4.388

  4.363

  4.230

  Torbay

  60.739

  8.740

  9.165

  9.117

  10.386

  Torridge

  26.114

  3.763

  3.945

  4.008

  4.161

  West Devon

  22.149

  2.936

  3.149

  3.133

  3.072

  Mendip

  46.734

  5.739

  6.163

  6.108

  6.028

  Sedgemoor

  50.003

  6.269

  6.931

  6.789

  6.721

  Tauton Deane

  47.125

  5.714

  7.045

  6.978

  6.770

  West Somerset

  17.425

  2.425

  2.600

  2.563

  2.591

  South Somerset

  71.162

  8.278

  8.939

  9.193

  9.140

  Great Crested Newt
  Mr. Matthew Taylor
  To ask the Secretary of State for the Environment how many licences have been applied for in respect of the great crested newt since 1981; how many of these have been approved; how many of these have been refused; what conditions have been attached to them; and what monitoring has been undertaken to assess their level of success or failure. [11866]

  Mr. Clappison
  English Nature is the licensing authority for a wide range of activities relating to great crested newts and my Department is the appropriate authority for safe licensing of this species.
  784
  The information to answer the question is not readily available. However, in addition to licences issued for other purposes, a recent review of the five-year period 1990–1995 has shown that 141 licences were issued to permit the translocation of great crested newts. Subsequent monitoring of projects has shown that in 92 per cent. of cases adults were found in subsequent years and in 61 per cent. of cases breeding was confirmed.

  Mr. Taylor
  To ask the Secretary of State for the Environment what criteria will be used to judge whether the receptor sites, within the Orton brick pits site of special scientific interest, are mature enough to support translocated newts; and if he will ensure that newts will not be translocated to the receptor sites before these criteria are fulfilled. [11865]

  Mr. Clappison
  A view of the suitability of the habitat for receiving translocated newts will be made by appropriate specialists. English Nature will not grant licences to translocate great crested newts until they are satisfied that the receptor sites appear suitable to receive the likely number of animals that will be captured during the translocation from any area of the Orton brick pit site.

  Mr. Taylor
  To ask the Secretary of State for the Environment what consultation procedures will take place before a licence is issued for the translocation of great crested newts from any part of the Orton brick pits site of special scientific interest. [11863]

  Mr. Clappison
  The normal procedure for evaluating licence applications is that they are considered by English Nature, and a decision is made following consultation with their specialist and local team staff. This procedure will be followed before licences are issued for the translocation of great crested newts from any part of the Orton brick pits area.

  To allow open discussion of methods, English Nature has convened a liaison group with non-governmental organisations. That group will meet for the first time on 16 February.

  Mr. Taylor
  To ask the Secretary of State for the Environment what conditions are attached to any applications for a licence to translocate great crested newts from any part of the Orton brick pits site of special scientific interest. [11864]

  Mr. Clappison
  The conditions that would apply to any applications for a licence to translocate newts from any part of this site are as follows: that the existing site must have been given planning consent and the notification of the site as an SSSI was taken into account; that the receptor site is suitable for the number of animals that is intended to move; that the translocation is of conservation benefit to the animals concerned; and that anyone carrying out the translocation is sufficiently qualified and able to do the work. Subsequent to any translocation of animals, the receptor site must be monitored to determine the level of occupation of the newts at the site.

  Mr. Taylor
  To ask the Secretary of State for the Environment what applications for licences English Nature has received, and what licences they have issued for the translocation of great crested newts from any part of the Orton brick pits site of special scientific interest, Peterborough, since the statement of intent was signed
  785
  between English Nature and Peterborough Southern Township Ltd. [11862]

  Mr. Clappison
  The Government's statutory scientific advisers, English Nature, advise that no applications have been received and no licences issued since the statement of intent was signed on 15 July 1995.

  Cemfuel Burning (Health Effects)
  Mr. Gordon Prentice
  To ask the Secretary of State for the Environment what communication he has had with Lancashire county council concerning the health effects experienced by staff of the National Physical Laboratory when monitoring air quality at Moorland school and Waddington and West Bradford primary school in connection with the burning of cemfuel by Castle Cement. [12211]

  Mr. Clappison
  Lancashire county council has been sent a copy of the full report from the National Physical Laboratory. I have received no comments.

  Mr. Prentice
  To ask the Secretary of State for the Environment how many National Physical Laboratory staff experienced(a) unpleasant odours, (b) respiratory effects and (c) eye or throat irritation during the air monitoring exercise at Castle Cement's Ribblesdale works between 7 August and 1 September 1995. [12213]

  Mr. Clappison
  Odour was detected by NPL staff on 10 occasions even though the measured sulphur dioxide levels were far below the generally accepted odour threshold. Respiratory effects and eye or throat irritation were each recorded on three occasions. On two of the occasions, respiratory effects were reported by one individual who is an asthma sufferer.

  The threshold guide value for sulphur dioxide, published by the expert panel on air quality standards, at which the health of some people could be affected, was never breached during the four weeks of monitoring.

  Mr. Prentice
  To ask the Secretary of State for the Environment when authorisation was given for the burning of cemfuel by Castle Cement at Clitheroe; what account was taken of potential problems arising from plume grounding in granting authorisation, and what technical solutions have been identified. [12013]

  Mr. Clappison
  Castle Cement, Clitheroe had started burning cemfuel in 1992 under the Health and Safety at Work etc. Act 1974. In 1993, cement manufacture came under the Environmental Protection Act 1990 and the Clitheroe authorisation was continued. Plume grounding had not been identified as a problem at that time.

  A variation to Castle Cement's authorisation, issued on 23 January 1996 requires Castle Cement to have agreed, with Her Majesty's inspectorate of pollution proposals for resolution of the plume grounding problem by 30 April 1996.

  Mr. Prentice
  To ask the Secretary of State for the Environment what caused the odour detected by staff of the National Physical Laboratory during the air quality monitoring at Castle Cement's Ribblesdale works at Clitheroe during the period 7 August to 1 September 1995. [12214]
  786
  Mr. Clappison
  The detection of odour by the staff from the National Physical Laboratory was correlated with concentrations of sulphur dioxide above 50ppb. However, this is significantly below the generally recognised odour detection threshold. It was not possible to identify any one compound responsible for the odour.

  Housing Bill
  Mr. Gerrard
  To ask the Secretary of State for the Environment (1) what additional resources he will make available to local authorities in order to implement the proposals on(a) homelessness, (b) housing allocations and (c) advice contained in the Housing Bill; [12141]

  (2) what additional resources he will make available to enable local authorities to provide housing advice services where they are not currently available to fulfil the duties set out in the Housing Bill. [12142]

  Mr. Clappison
  The provisions redefining the duty owed by local authorities to persons accepted as homeless and the accompanying reform of the allocation of social housing should not have a significant effect on central or local government expenditure. The effect will depend in part on the nature of the allocation schemes which local authorities establish in the light of principles to be prescribed by the Secretary of State in regulations. Expenditure on advisory services, where these do not already exist in a satisfactory form, should be fully offset.

  Mr. Gerrard
  To ask the Secretary of State for the Environment what assessment he has made of additional demands for assistance under the provisions of the Children Act 1989 which may arise from homeless families refused assistance under the proposed homelessness legislation contained in the Housing Bill. [12146]

  Mr. Clappison
  There is no reason why there should be any such demand; the relevant provisions in the Housing Bill make no changes to the groups which have a priority need for accommodation.

  Mr. Gerrard
  To ask the Secretary of State for the Environment (1) what assessment he has made of the change in the rate of use of properties in the private rented sector by local authorities under the provisions of the Housing Bill; [12147]

  (2) what assessment he has made of the future availability to homeless households of properties in the private rented sector. [12148]

  Mr. Clappison
  We expect the private rented sector to continue to develop and to make an important contribution to meeting the housing needs of a wide range of households.

  Mr. Gerrard
  To ask the Secretary of State for the Environment what research his Department has(a) evaluated and (b) commissioned into the likely housing benefit costs (i) to central Government funds and (ii) to local authorities of the provisions of the Housing Bill. [12143]

  Mr. Clappison
  We have given careful consideration to the financial effects, including those relating to the cost of housing benefit, of the provisions in parts VI and VII of the Housing Bill. The Government consider that the provisions should not have a significant effect on central
  787
  or local government expenditure. This will depend in part on the nature of the allocation schemes which local authorities establish in the light of principles to be prescribed by the Secretary of State in regulations. We will monitor local authorities' implementation of the provisions.

  Mr. Gerrard
  To ask the Secretary of State for the Environment whether alternative accommodation in the private sector will be deemed suitable if rent exceeds the local reference rent under the provisions contained in the Housing Bill. [12149]

  Mr. Clappison
  Suitable alternative accommodation for the purposes of part VII of the Housing Bill would need to be affordable within the resources available to the applicant, including housing benefit where applicable.

  Environmentally Hazardous Projects
  Mr. Hew Smith
  To ask the Secretary of State for the Environment if he will make a statement on the implications for the rights of United Kingdom citizens to challenge potentially environmentally hazardous projects, endorsed by the European Commission, of the two decisions of the European court of first instance, case T-585/93 on 9 August 1995 and case T-219/95 on 22 December 1995. [11985]

  Mr. Clappison
  Citizens of the European Union, including UK citizens, who seek to institute proceedings against a Commission decision must show that the decision is of direct and individual concern to them, as required by article 173 of the treaty establishing the European Community and article 146 of the Euratom treaty.

  In both of the cases referred to, T-219/95 and T-585/93, the European court of first instance found that the applicants did not meet the above requirements. In the case of T-585/93, that ruling is now the subject of an appeal in the European Court of Justice.

  Water Authorities
  Mr. Ian McCartney
  To ask the Secretary of State for the Environment (1) how many people served on the boards of the(a) Anglian water authority, (b) Welsh water authority, (c) Northumbrian water authority, (d) North West water authority, (e) Severn Trent water authority, W Southern water authority, (g) South West water authority, (h) Thames water authority, (i) Wessex water authority, and (j) Yorkshire water authority, in the final year before each was privatised; [12186]

  (2) how much was paid to people serving on boards of (a) Anglian water authority, (b) Welsh water authority, (c) Northumbrian water authority, (d) North West water authority, (e) Severn Trent water authority, (f) Southern water authority, (g) South West water authority, (h) Thames water authority, (i) Wessex water authority, and (j) Yorkshire water authority, in the final year before each was privatised. [12188]

  Mr. Clappison
  Information about the number and remuneration of water authority board members in the year prior to privatisation is given in "Public Bodies 1989", issued by the Cabinet Office (Office of Public Service and Science). A copy of this publication is available in the Library.
  788
  Mr. McCartney
  To ask the Secretary of State for the Environment how many people were employed by(a) Anglian water authority, (b) Welsh water authority, (c) Northumbrian water authority, (d) North West water authority, (e) Severn Trent water authority, (f) Southern water authority, (g) South West water authority, (h) Thames water authority, (i) Wessex water authority, and (j) Yorkshire water authority, in the final year before each was privatised. [12190]

  Mr. Clappison
  Manpower information for the water industry in the final year before privatisation is given in "Waterfacts 1989", published by the Water Services Association. A copy of this publication is available in the Library.

  Burnley and Pendle Transport
  Mr. Gordon Prentice
  To ask the Secretary of State for the Environment, pursuant to his answer of 9 January,Official Report, column 8, what are the implications of the refusal to grant a dispensation to vote for councillor Jill Gilhespy for her chairing the council meeting which will consider a report on the sale of Pendle's stake in Burnley and Pendle Transport. [12229]

  Sir Paul Beresford
  The decision to decline Councillor Gill Gilhespy's application for a dispensation to vote need have no implications for her chairing the meeting which will consider a report on the sale of Pendle's stake in Burnley and Pendle Transport, except that the chairman's casting vote will not be available to her.

  Wildlife Habitats
  Mr. Chris Davies
  To ask the Secretary of State for the Environment what protection for ponds as wildlife habitats is offered by existing planning legislation. [12311]

  Sir Paul Beresford
  Section 38 of the Town and Country Planning Act 1990 requires local planning authorities to include in their development plans policies in respect of the natural beauty and amenity of the land. Regulation 37 of the Conservation (Natural Habitats and etc.) Regulations 1994 provides for such policies to include policies encouraging the management of landscape features which are of major importance for wild flora and fauna, such as ponds.

  Mr. Davies
  To ask the Secretary of State for the Environment what(a) grants and (b) other financial assistance his Department makes available for the construction, conservation and management of ponds as wildlife habitats. [12288]

  Mr. Clappison
  My Department supports grant assistance for the creation or management of ponds under the countryside stewardship scheme, and SSI management agreements. In the light of stewardship's successful pilot phase, and in advance of its transfer to the Ministry of Agriculture, Fisheries and Food on 1 April 1996, my right hon. Friend the Minister announced in November that an extra £5 million will be available for new management agreements under countryside stewardship for each of the years 1996–97 and 1997–98. This is in addition to the existing £11.625 million already available under the scheme.
  789
  The Ministry of Agriculture, Fisheries and Food also provides support for work on ponds under the environmentally sensitive areas scheme, and the Government fund conservation advice provided by ADAS and the farming and wildlife advisory group, including advice on ponds.

  Domestic Gas Appliances
  Mr. Hanson
  To ask the Secretary of State for the Environment what assessment he has made of the number of households that are at risk of carbon monoxide poisoning from gas appliances. [12439]

  Sir Paul Beresford
  None. Every household containing a gas appliance may be potentially at risk from carbon monoxide poisoning. The best means of prevention is to ensure that gas appliances are correctly installed and regularly maintained by gas installers who are registered with the Council for Registered Gas Installers.

  Repossessions
  Mrs. Bridget Prentice
  To ask the Secretary of State for the Environment how many repossessions there have been in each region since 1992. [12569]

  Mr. Clappison
  Data are not held centrally on the number of repossessions in each region.

  British Gas (Contaminated Land)
  Mr. Simon Hughes
  To ask the Secretary of State for the Environment what is the amount of land officially designated as contaminated land which is owned by British Gas plc; and if he will list all such land. [12616]

  Mr. Clappison
  [holding answer 30 January 1996]: At present, there is no statutory system in force for designating contaminated land. When section 57 of the Environment Act 1995 is implemented, it will provide a statutory definition of contaminated land and procedures for its identification.

  Mr. Hughes
  To ask the Secretary of State for the Environment what amount of money has been notified to his Department as having been spent by British Gas plc in the decontamination of land within its ownership in each financial year since privatisation. [12614]

  Mr. Clappison
  [holding answer 30 January 1996]: British Gas plc has not notified the Department how much it has spent in the decontamination of land within its ownership since privatisation.

  Mr. Hughes
  To ask the Secretary of State for the Environment what is the total spending contribution towards the decontamination of land within British Gas plc's ownership by(a) local authorities, (b) the Department of the Environment, (c) English Partnerships (d) the European Union and (e) other public bodies in each financial year since privatisation. [12615]

  Mr. Clappison
  [holding. answer 30 January 1995]: When the Department of the Environment contributes to the costs of decontamination of land, this is normally only one element of a wider package of support for individual reclamation or redevelopment projects. Central records do not exist of the amounts of the various different cost elements.
  790
  English Partnerships has not spent any money on decontamination of land within British Gas plc's ownership since its privatisation.

  The Department does not systematically collect information on spending on decontamination of land by local authorities, the European Union or other public bodies.

  Home Energy Efficiency Scheme
  Mrs. Ray Michie
  To ask the Secretary of State for the Environment what measures he will take to ensure that the current number and value of grants paid to householders receiving funding for the home energy efficiency scheme will be maintained. [10800]

  Mr. Robert B. Jones
  We expect the number and value of home energy efficiency scheme grants paid to low-income households to be at least maintained. We intend that better-off elderly householders will have to contribute to the cost after 1 April 1996, and we expect many will take advantage of the substantial discount that the scheme will offer them on the cost of installing basic insulation. Their contributions will supplement the £73 million allocated to the scheme for 1996–97, and we anticipate that considerably more than 400,000 grants will be paid next year. Local authorities will, following implementation of the Home Energy Conservation Act 1995, have a key responsibility to identify appropriate ways of improving the energy efficiency of homes in their areas.

  Homelessness
  Mr. Alex Carlile
  To ask the Secretary of State for the Environment if he will estimate the average number of homeless people in England and Wales for each of the years(a) 1980, (b) 1985, (c) 1990, (d) 1992, (e) 1993, (f) 1994 and (g) 1995; and if he will make a statement. [12458]

  Mr. Clappison
  The numbers of households for which local authorities in England accepted responsibility to secure accommodation under the homelessness provisions of the Housing (Homeless Persons) Act 1977 and the Housing Act 1985 in the years, requested were as follows:

  Number

  19801

  60,400

  1985

  91,010

  1990

  140,350

  1992

  142,890

  1993

  132,380

  1994

  122,660

  1995 (January-September only)

  92,650

  Note:

  1This figure is not strictly comparable with those for the later years because of changes to reporting arrangements made in 1980 (for non-metropolitan districts) and 1982 (for London boroughs and metropolitan districts).

  Source:

  Quarterly P1(E) returns.

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

  Sustainable Development
  Mr. Llew Smith
  To ask the Secretary of State for the Environment what plans he has to implement paragraph 46 of the report of the Government's panel on sustainable development, published on 25 January. [12684]

  Mr. Clappison
  We intend to publish a considered response to the recommendations made in the panel's second report, including that in paragraph 46, at the end of March 1996.

  Building Research Establishment
  Mr. John Greenway
  To ask the Secretary of State for the Environment what changes have been made to the membership of the advisory group overseeing the study into options for privatisation of the Building Research Establishment. [13224]

  Mr. Robert B. Jones
  Mr. Roger Courtney, chief executive of the Building Research Establishment invited the Department in mid-January to consider his position as a member of the advisory group which would shortly be asked for their guidance once consultants had completed their study of privatisation options. He indicated that he would wish to be able to participate in future management arrangements for BRE; this could include being involved in any proposal for a management and employee buy-out if Ministers, in the light of the consultants' report, decided that this was an option to be pursued. In those circumstances, he and the Department judged that he should not be privy to those parts of the consultants' report which contained commercial assessments as this could place him in an advantageous position compared with any other potential purchasers. Mr. Neil Milbank, deputy chief executive of BRE, who will retire during 1996 and will therefore not be involved in the future management of the establishment, has taken Mr. Courtney's place on the advisory group.

NORTHERN IRELAND

  Positive about Disabled People Symbol
  Mr. Barnes
  To ask the Secretary of State for Northern Ireland if he will list for his Department and each of the

  Male

  Female

  Both Sexes

  Protestant and others

  Roman catholic

  Protestant and other

  Roman Catholic

  Protestant and others

  Roman Catholic

  Economically Active

  212,574

  143,234

  148,998

  95,490

  361,572

  238,724

  Unemployed

  26,895

  40,647

  11,943

  13,863

  38,838

  54,410

  Unemployment Rate

  12.7

  28.4

  8

  14.5

  10.7

  22.8

  A very sqiall proportion of The "Protestant and others" category—approximately 0.5 per cent.—were members of non-Christian religions.
  792
  agencies for which he is responsible if it uses the Employment Service's positive about disabled people symbol for (a) external recruitment and (b) internal recruitment and promotion. [11916]

  Sir John Wheeler
  The Northern Ireland civil service and Norther Ireland Office do not use the Employment Service's positive about disabled people symbol. The NICS's arrangements in respect of the recruitment and management of disabled staff are set out in the code of practice on the employment of people with disabilities in the Northern Ireland civil service. The principles and guidance applying to the recruitment and management of the home civil service staff group in the Northern Ireland Office are set out in the programme for action to achieve equality of opportunity in "The Civil Service and Disabled People" published by the Office of Public Service and Science, now the Office of Public Service.

  Honours Recommendations
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland what is his policy in respect of consultation with the Eire Government in respect of recommendations for honours; and if he will make a statement. [11684]

  Sir John Wheeler
  There is no consultation with the Irish Government regarding the recommendation of individuals for honours.

  Unemployment
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland (1) what is the overall percentage and proportionate rates of unemployment of Catholics, Protestants and others, the numbers involved and those figures broken down by gender with sources; [11685]

  (2) what is the overall percentage and proportionate rates of unemployment of Catholics, Protestants and others, the numbers involved and those figures broken by male and female, with sources; and if he will give his Department's views as to the reasons for the differentials. [11689]

  Sir John Wheeler
  The information in the table is based on those for whom a religion was recorded in the 1991 census of population.

  The difference in unemployment rates between Catholics and Protestants is due to the interaction over time of a complex range of factors which has been the subject of academic debate since the 1970s. This is one of the issues to be addressed in the employment equality review currently being undertaken by the Standing Advisory Commission on Human Rights.

  Coinage
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland, pursuant to his answer of 9 January 1995,Official Report, column 107, if he subjected his decision to agree to the Royal Mint's proposal for a Celtic torc and a Celtic cross to be the symbols representing

  793
  Northern Ireland on the new £1 coin to his Department's policy appraisal and fair treatment guidelines. [11686]

  Sir Patrick Mayhew
  No.

  Donna Maguire
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland if he will arrange for the costs of Donna Maguire's criminal activities to be deducted from her award for ankle injuries. [11687]

  Mr. Moss
  An appeal against the award is under consideration. It would be inappropriate to comment further on the case in these circumstances.

  Housing (Residency Requirements)
  Mr. Robert McCartney
  To ask the Secretary of State for Northern Ireland how many years residency are required before a United Kingdom citizen not born in Northern Ireland becomes eligible under the standard rules to be housed by the Northern Ireland Housing Executive; and if he will detail some comparable rules in England and Scotland. [11688]

  Mr. Moss
  As I confirmed to the hon. Gentleman in my letter of 14 November 1995, the housing selection scheme operated by the Housing Executive and approved by the Department of the Environment provides that, before they can be considered for public housing, applicants—other than those with an entitlement to be housed on a priority basis—must:

  (a) have been born in Northern Ireland; or

  (b) have been resident in Northern Ireland for the past seven years; or

  (c) have accepted an offer of employment or be currently employed in Northern Ireland; or

  (d) would have been resident in Northern Ireland for the past seven years but for employment in the Crown elsewhere.

  In England and Wales, local authorities are responsible for allocating housing within the framework laid down in sections 22 and 23 of the Housing Act 1985. A survey carried out by the Department of the Environment in London shows that around 90 per cent. of local authorities in England operate a residency condition. Details of the length of time that each authority requires an applicant to reside in their area is not held centrally.

  Sections 9 to 21 of the Housing (Scotland) Act 1987 set out the framework for allocating and managing housing in Scotland. Scottish authorities are required not to take account of an applicant's length of residence. Details of the individual schemes and the authorities' observance of this requirement are not held centrally.

  Development Grants
  Mr. McAvoy
  To ask the Secretary of State for Northern Ireland what economic development grants Northern Ireland has received in each of the last five years from(a) the EU and (b) other sources; and what is the total value of these. [9625]

  Mr. Ancram
  [holding answer 25 January 1996]: The following table shows what has been drawn down in each of the last five years in respect of economic development grants from the European Union.
  794

  Year

  £000

  1991

  58,135

  1992

  96,035

  1993

  120,116

  1994

  30,213

  1995

  14,003

  Total

  318,502

  With regard to funding from other sources, the international fund for Ireland provides financial contributions which support economic development in Northern Ireland. Information about the financial support provided by this independent international organisation is contained in its published annual reports, copies of which are available in the Library.

  Telecommunications Masts
  Mr. William Ross
  To ask the Secretary of State for Northern Ireland how many planning applications he has received from Millennium Communications, Stockport, for the erection of telecommunications relay station masts in Northern Ireland; what are the exact locations of each of these masts; and what steps he intends to take to apply planning controls to such structures. [12150]

  Mr. Moss
  No planning applications have been received. The erection of telecommunications relay station masts by licenced public telecommunications code system operators is, subject to certain criteria, permitted development by virtue of article 3 of the Planning (General Development) Order (Northern Ireland) 1993.

  Fisheries
  Rev. Ian Paisley
  To ask the Secretary of State for Northern Ireland what studies have been undertaken by the Department of Agriculture to establish catch figures for fisheries on the Rivers Maine and Kells water system. [12083]

  Mr. Ancram
  None. There is no statutory requirement for anglers to make catch returns.

  Rev. Ian Paisley
  To ask the Secretary of State for Northern Ireland what assessment he has made of the need for counters to be employed on the River Maine system to enable the fishery division to compile accurate figures on the health of the migratory stocks. [12084]

  Mr. Ancram
  None. The provision of fish counters on watercourses is a matter for fishery owners. Funds are currently available to assist such projects.

  Balmoral-Malone Traffic Scheme
  Rev. Ian Paisley
  To ask the Secretary of State for Northern Ireland if he will make a statement on the cost benefit analysis check sensitivity test for induced traffic effects on the Balmoral-Malone roads traffic scheme; what estimate he has made of the time savings in pounds sterling for each of the 30 years' assumed life of the scheme from the COBA output; if he will indicate the total(a) vehicle kilometres and (b) number of predicated accidents by category for (i) the do nothing and (ii) do

  795
  something options for (1) the opening year and (2) the design year (year 15); and if he will list the value accident savings in pounds sterling for each of the 30 year life discounted as for time savings. [11932]

  Mr. Moss
  The cost benefit analysis check sensitive test for induced traffic effects on the Malone road/Balmoral avenue traffic scheme shows that no induced traffic is expected as a result of this scheme.

  The time savings, in sterling, for each of the 30 years' assumed life of the scheme based on low traffic growth and high traffic growth are as follows:

  Savings £'000

  Year

  Low Traffic Growth

  High Traffic Growth

  1.

  326

  366

  2.

  315

  348

  3.

  304

  330

  4.

  286

  316

  5.

  269

  302

  6.

  254

  283

  7.

  238

  273

  8.

  224

  272

  9.

  211

  268

  10.

  200

  265

  11.

  188

  264

  12.

  176

  255

  13.

  163

  245

  14.

  156

  252

  15.

  151

  272

  16.

  146

  313

  17.

  141

  375

  18.

  135

  535

  19.

  130

  707

  20.

  126

  684

  21.

  122

  661

  22.

  117

  637

  23.

  110

  612

  24.

  102

  587

  25.

  99

  562

  26.

  98

  537

  27.

  98

  512

  28.

  100

  487

  29.

  104

  460

  30.

  111

  429

  Total

  5,202

  12,408

  The total vehicle kilometers and number of pedicted accidents based on low high traffic growth are as follows:

  Low Traffic Growth

  High Traffic Growth

  Year

  Do nothing

  Do something

  Do nothing

  Do something

  Vehicle kilometres in millions

  1

  15

  15

  15

  15

  15

  19

  19

  22

  22

  Number of accidents

  1

  7.4

  4.4

  8.1

  4.5

  15

  8.2

  4.8

  9.3

  5.2

  The value accident savings, in sterling, for each of the 30 year life of the scheme, based on the low and high traffic growth, are as in the table.
  796

  Value of savings £000

  Year

  Low traffic growth

  High traffic growth

  1.

  40

  49

  2.

  38

  48

  3.

  36

  46

  4.

  34

  44

  5.

  32

  43

  6.

  30

  41

  7.

  29

  39

  8.

  27

  38

  9.

  26

  37

  10.

  24

  35

  11.

  23

  34

  12.

  22

  33

  13.

  21

  32

  14.

  20

  30

  15.

  19

  29

  16.

  18

  28

  17.

  17

  27

  18.

  16

  26

  19.

  15

  25

  20.

  14

  24

  21.

  14

  23

  22.

  13

  22

  23.

  12

  21

  24.

  12

  21

  25.

  11

  20

  26.

  10

  19

  27.

  10

  18

  28.

  9

  18

  29.

  9

  17

  30.

  8

  16

  Total

  608

  902

  Council Grants
  Mr. McGrady
  To ask the Secretary of State for Northern Ireland if he will list the rates of general grant, showing the breakdown between the derating and resources elements, for each district council in Northern Ireland for each year since 1994–95. [12535]

  Mr. Moss
  The information requested is set out in the table. The figures for 1994–95 include final adjustments for the two previous years and the 1995–96 figures include final adjustments which will be paid before the end of this financial year, subject to certification of district council accounts by the local government auditor.

  1994–95

  District

  Derating £

  Resources £

  Total £

  Antrim

  309,908

  -112,747

  197,161

  Ards

  711,920

  1,062,141

  1,774,061

  Armagh

  275,135

  1,593,741

  1,868,876

  Ballymoney

  718,403

  —

  718,403

  Ballymoney

  220,629

  525,118

  745,747

  Banbridge

  229,073

  892,883

  1,121,956

  Belfast

  5,846,365

  —

  5,846,365

  Carrickfergus

  307,680

  437,875

  745,555

  Castlereagh

  512,526

  298,125

  810,651

  Coleraine

  409,317

  —

  409,317

  Cookstown

  238,106

  692,119

  930,225

  Craigavon

  1,637,293

  89,477

  1,726,770

  Derry

  1,145,041

  1,792,497

  2,937,538

  Down

  299,345

  1,812,686

  2,112,031

  Dungannon

  367,827

  1,058,923

  1,426,750

  797

  1994–95

  District

  Derating £

  Resources £

  Total £

  Fermanagh

  553,940

  1,167,882

  1,721,822

  Lame

  217,165

  664,012

  881,177

  Limavady

  170,154

  898,466

  1,068,620

  Lisburn

  1,033,272

  589,820

  1,623,092

  Magherafelt

  377,623

  1,039,557

  1,417,180

  Moyle

  108,330

  410,627

  518,957

  Newry/Mourne

  577,501

  2,556,116

  3,133,617

  Newtonabbey

  1,276,963

  1,276,963

  North Down

  414,552

  699,579

  1,114,131

  Omagh

  190,938

  1,435,142

  1,626,080

  Strabane

  322,605

  1,339,038

  1,661,643

  Totals

  18,471,611

  20,943,077

  39,414,688

  1995–96

  District

  Derating £

  Resources £

  Total £

  Antrim

  360,755

  —

  360,755

  Ards

  811,407

  984,791

  1,796,198

  Armagh

  376,981

  1,681,329

  2,058,310

  Ballymena

  798,564

  —

  798,564

  Ballymoney

  318,699

  478,469

  797,168

  Banbridge

  254,772

  988,424

  1,243,196

  Belfast

  6,373,997

  —

  6,373,997

  Carrickfergus

  295,355

  590,166

  885,521

  Castlereagh

  862,060

  393,044

  1,255,104

  Coleraine

  437,738

  32,901

  470,639

  Cookstown

  350,159

  674,808

  1,024,967

  Craigavon

  2,029,539

  459,519

  2,489,058

  Derry

  1,228,371

  1,675,867

  2,904,238

  Down

  394,345

  2,184,455

  2,578,800

  Dungannon

  572,831

  1,085,219

  1,658,050

  Fermanagh

  454,810

  1,100,110

  1,554,920

  Lame

  492,766

  216,179

  708,945

  Limavady

  148,651

  800,255

  948,906

  Lisburn

  1,243,600

  215,243

  1,458,843

  Magherafelt

  381,273

  995,842

  1,377,115

  Moyle

  97,957

  415,396

  513,353

  Newry/Mourne

  722,768

  2,495,036

  3,217,804

  Newtonabbey

  1,421,220

  —

  1,421,220

  North Down

  512,785

  141,488

  654,273

  Omagh

  372,428

  1,610,166

  1,982,594

  Strabane

  324,914

  1,368,550

  1,693,462

  Totals

  21,638,743

  20,587,257

  42,226,000

SCOTLAND

  Crime
  Mr. David Shaw
  To ask the Secretary of State for Scotland what measures he is pursuing to reduce crime. [10802]

  Lord James Douglas-Hamilton
  My right hon. Friend and I are determined to fight crime and have provided for the deployment of 500 additional operational police officers, backed up by improved technology, and a £4 million challenge competition to help fund more closed-circuit television schemes.
  798
  28. Lady Olga Maitland
  To ask the Secretary of State for Scotland what plans he has to combat crime. [10815]

  Lord James Douglas-Hamilton
  The Scottish Office is pursuing a number of measures to reduce crime, including the provision of funds for the deployment of 500 additional operational police officers, backed up by improved technology and a £4 million challenge competition to help fund more CCTV schemes.

  Beef Industry
  16. Mr. John Greenway
  To ask the Secretary of State for Scotland what priority he attaches to the beef industry in Scotland. [10803]

  Mr. Raymond S. Robertson
  My noble Friend the Minister with responsibility and I attach great priority to a sector which represents approximately 30 per cent. of Scottish agricultural output, and has an international reputation for the highest quality.

  Scottish Enterprise
  Mr. Galbraith
  To ask the Secretary of State for Scotland when he last met the chairman of Scottish Enterprise to discuss his budget. [10804]

  Mr. Kynoch
  My right hon. Friend last met the chairman of Scottish Enterprise on 15 November 1995 to discuss a wide range of issues, including the Scottish Enterprise budget.

  Central European Time
  Mr. Nicholas Winterton
  To ask the Secretary of State for Scotland what representations he has received about central European time in respect of the construction and agriculture industries in Scotland. [10805]

  Lord James Douglas-Hamilton
  Of the letters received in the Scottish Office recently about the proposed change to central European time, two expressed opposition to the measure solely on account of its impact on the agricultural and construction industries; many of the rest alluded, among other things, to the adverse effects on these industries.

  Local Government Finance
  Sir David Steel
  To ask the Secretary of State for Scotland if he will make a statement about his financial allocations to the new councils for 1996–97. [10806]

  Mr. Kynoch
  Capital allocations to all authorities will be announced in February or March.

  Mr. Ernie Ross
  To ask the Secretary of State for Scotland when he last met the Convention of Scottish Local Authorities to discuss local government finance. [10824]

  Mr. Kynoch
  On 26 January.

  Mr. Kirkwood
  To ask the Secretary of State for Scotland when he next expects to meet representatives of the new unitary councils to discuss the financial settlement for 1996–97. [10792]

  Mr. Michael Forsyth
  I did so last Friday 26 January 1996.

  Councils (Housing Expenditure)
  Mr. Nigel Griffiths
  To ask the Secretary of State for Scotland if his Department approved the balance of spending by councils on capital housing projects and the repayment of debt in previous years. [10807]

  Mr. Kynoch
  No; within the resources made available to them, local authorities decided the balance between spending and level of debt repayment.

  Lockerbie
  Mr. Dalyell
  To ask the Secretary of State for Scotland what assessment he has made of the consequences of the lapse of time since the Lockerbie crime for the prosecution of, and case against, two Libyans accused of the destruction of Pan Am 103 over Lockerbie. [10808]

  Lord James Douglas-Hamilton
  My right hon. Friend remains concerned that, more than seven years after the commission of the crime and four years after the Libyan Government were called on to surrender the two accused, they have yet to comply with our demands, which have been endorsed by the United Nations Security Council.

  Residential Care Homes
  Dr. Godman
  To ask the Secretary of State for Scotland when he expects to receive the report of the Scottish Office working group on residential care home registration procedures; and if he will place a copy in the Library. [10809]

  Mr. Michael Forsyth
  The range of issues considered by the working group was more complex than originally anticipated, and I now expect to receive the report before the end of March. I will make arrangements for a copy to be placed in the House of Commons Library.

  Scottish Economic Council
  Mr. Bill Walker
  To ask the Secretary of State for Scotland what plans he has to meet the Scottish Economic Council to discuss public funding. [10810]

  Mr. Kynoch
  My right hon. Friend hopes to arrange the first meeting of the new Scottish Economic Council very soon and looks forward to receiving the council's views on a wide range of matters affecting the Scottish economy, including priorities for public expenditure.

  Independence (Public Finances)
  Mr. Whittingdale
  To ask the Secretary of State for Scotland what representations he has received about the effect on public finances of Scottish independence. [10811]

  Mr. Michael Forsyth
  I am fully aware of the concerns most Scots have over the prospect of Scottish independence and how it would endanger the funding advantage that Scotland derives from the Union.

  Local Authorities (Severe Weather)
  Mr. David Marshall
  To ask the Secretary of State for Scotland how much additional financial help he has given to local authorities to deal with the problems caused by the recent severe weather. [10812]
  800
  Mr. Kynoch
  We have made it clear that we are prepared to consider sympathetically claims both for Bellwin scheme assistance and for additional capital consents. My officials are already working with the Convention of Scottish Local Authorities to gather detailed information on revenue costs. We have received, very recently, a number of initial requests for capital consent, but further information will be required before we can consider these. As soon as detailed claims are received, they will be considered as a matter of urgency.

  School Buildings
  Mr. Charles Kennedy
  To ask the Secretary of State for Scotland what assessment he has made of the standard of school buildings; and if he will make a statement. [10813]

  Mr. Raymond S. Robertson
  It is the responsibility of individual education authorities to maintain relevant information about their buildings.

  Industrial Development
  Sir Hector Monro
  To ask the Secretary of State for Scotland what are the prospects for(a) industrial investment and (b) employment levels in Scotland; and if he will make a statement. [10814]

  Mr. Kynoch
  The prospects for industrial investment and employment in Scotland remain excellent. Recent business survey evidence in Scotland confirms this. The Government's economic policies are providing the necessary conditions for investment and job creation—low interest rates, low taxation and low inflation within a climate of sound public finances.

  Tree Diseases
  Mr. Pawsey
  To ask the Secretary of State for Scotland what Government grants are available for research into tree diseases; and what was the total expenditure on such grants in 1994–95. [10816]

  Mr. Kynoch
  Several Government Departments undertake or commission research into tree diseases, notably the Forestry Commission, and we also fund some projects by universities and other bodies. However, we do not offer grants specifically for forestry research. Our expenditure on research into tree diseases in 1994–95 amounted 'to £1.3 million.

  Scottish Parliament
  Mr. Nigel Evans
  To ask the Secretary of State for Scotland what representations he has received about the costs of a Scottish Parliament. [10817]

  Mr. Michael Forsyth
  I have been made aware on numerous occasions of the deep-rooted apprehension felt by Scots about the costs that a Scottish Parliament would place upon them.

  Angling
  Mr. Bellingham
  To ask the Secretary of State for Scotland when he next expects to meet representatives of the hotel and tourist industry to discuss projects to improve angling in Scotland. [10818]
  801
  Mr. Raymond S. Robertson
  I recognise fully the importance of angling to the Scottish hotel and tourist industry but have no plans at present to meet the industry to discuss angling.

  Housing (Edinburgh)
  Mr. Chisholm
  To ask the Secretary of State for Scotland if he will meet the Edinburgh Tenants Federation to discuss housing needs in Edinburgh. [10819]

  Mr. Raymond S. Robertson
  My right hon. Friend and I have no plans for such a meeting. Meeting housing needs in Edinburgh is a matter for Edinburgh district council in the first instance. However, the federation has been offered a meeting with officials of my Department, if it wishes.

  Fire Services (Strathclyde)
  Mr. Ingram
  To ask the Secretary of State for Scotland when he last met the chief firemaster of Strathclyde regional council to discuss operational matters; and if he will make a statement. [10820]

  Lord James Douglas-Hamilton
  My right hon. Friend last met the firemaster of Strathclyde fire brigade, in his capacity as chairman of the Scottish district of the Chief and Assistant Chief Fire Officers Association, on 25 September 1995. A number of operational and other matters were discussed.

  Private Finance Initiative
  Mr. Robert G. Hughes
  To ask the Secretary of State for Scotland what policies he is pursuing to expand PFI activities in Scotland. [10822]

  Mr. Kynoch
  Private sector alternatives must be fully considered for all capital spending for which the Scottish Office is responsible before public finance is made available. I have recently strengthened the private finance unit in the Scottish Office in order to help local authorities, in particular, take full advantage of the PFI.

  Rutherglen Maternity Hospital
  Mr. McAvoy
  To ask the Secretary of State for Scotland what recommendation he has had from Greater Glasgow health board about the future of Rutherglen maternity hospital. [10823]

  Lord James Douglas-Hamilton
  Greater Glasgow health board has recommended that Rutherglen maternity hospital should close once replacement maternity services are available from a purpose-built maternity unit at Glasgow royal infirmary.

  The recommendation is being considered along with others in the acute and maternity services strategy, submitted by Greater Glasgow health board to my right hon. Friend the Secretary of State, on 20 December 1995.

  Lothian Electric Machines, Haddington
  Mr. Home Robertson
  To ask the Secretary of State for Scotland how many redundancies have been notified by Lothian Electric Machines of Haddington for the eight months to the end of March 1996; what discussions he has had with IBM about the decision to transfer the 802
  manufacture of computer keyboards from Scotland to the far east; and if he will make a statement. [10838]

  Mr. Kynoch
  During the period in question, Lothian Electric Machines of Haddington notified the Department of Employment of 273 redundancies. Decisions by IBM about the sourcing of its purchases are of course a matter for the company, but the hon. Gentleman should be aware that Scottish Enterprise works closely with indigenous companies and major original equipment manufacturers—OEMs—across a range of industrial sectors to improve the competitiveness of local suppliers and, as a result, increase overall the proportion of purchases made by these OEMs from Scottish companies. These sourcing and business development activities have proved highly successful. Scottish Enterprise's manufacturing services group is available to discuss with Lemac what assistance can be made available.

  Unemployment (East Lothian)
  Mr. Home Robertson
  To ask the Secretary of State for Scotland what is the current level of unemployment in east Lothian; what will be the impact of redundancies notified by Lemac of Haddington; and if he will consult the East Lothian council and Lothian and Edinburgh Enterprise Ltd. about action to create jobs in east Lothian. [10837]

  Mr. Kynoch
  In December 1995, there were 844 people—5.8 per cent. of the work force—in the Haddington travel-to-work area who were registered as unemployed or claiming benefit. If the redundancies notified by Lemac take place, there will be a further 73 indirect and induced job losses in the Haddington travel-to-work area. Lothian and Edinburgh Enterprise Ltd. has arranged an early meeting with the company to discuss the retraining of staff who are made redundant, and to discuss the scope for assisting towards product development by the company. I understand that those affected by these redundancies will be eligible for immediate entry for training for work support.

  Public Authority Dwellings (Sales)
  Dr. Godman
  To ask the Secretary of State for Scotland if he will list for each district and island council, for each of the years between 1979–80 and 1994–95 the number of sales of public authority dwellings which were not owned by new towns, Scottish Homes or fell within district and islands councils' housing revenue account; and if he will indicate for each year and each district or island area to which public organisation the dwellings belonged. [10854]

  Mr. Raymond S. Robertson
  [holding answer 29 January 1996]: Since the available information—which covers dwellings owned by district, islands and regional authorities, but not Government Departments—is rather lengthy, I have arranged for it to be sent to the hon. Member. A copy is also being placed in the Library.

  Interdicts
  Mr. Connarty
  To ask the Secretary of State for Scotland how many interdicts are currently in force to prevent a parent in Scotland from approaching his or her children. [12395]
  803
  Lord James Douglas-Hamilton
  This information is not collected centrally.

  North Lanarkshire Council
  Mr. David Shaw
  To ask the Secretary of State for Scotland when he expects to receive the report of the inquiry into the appointment procedures of North Lanarkshire council. [13419]

  Mr. Michael Forsyth
  I received Mr. MacLeod's report on 25 January. I am grateful to him for a comprehensive report which has been completed within a very short period. I am placing copies in the House Library today.

  Mr. MacLeod's report concludes that the North Lanarkshire council has not failed to comply with the requirements of section 7 of the Local Government and Housing Act 1989 to appoint staff solely on merit and no further action is required by me.

TRANSPORT

  Marchioness Inquest
  Mr. Cyril D. Townsend
  To ask the Secretary of State for Transport if he will make a statement of his Department's conclusions in respect of the recommendations of the Marchioness inquest jury. [13418]

  Mr. Norris
  My noble Friend the Minister for Aviation and Shipping has arranged for a paper setting out the Department's views on the recommendations of the Marchioness inquest jury to be placed in the Library of the House.

  The Department agrees with the majority of the jury's 12 recommendations. In many cases, existing rules and guidelines already meet the jury's proposals. In those cases where recommendations are aimed at other agencies, the Department is pursuing the recommendations with the agencies in question.

  The jury endorsed the earlier recommendations of the marine accident investigation branch report into the Marchioness sinking, together with the recommendations of the report of the inquiry into river safety by Mr. John Hayes. All of the recommendations in the MAIB's report have since been implemented. Action has also been taken on the recommendations of the Hayes report and an updated statement of the position is included in the paper published today.

  Central Railways plc
  Mr. Chidgey
  To ask the Secretary of State for Transport, pursuant to his answer of 22 January,Official Report, column 36, if he will provide a schedule of the applications by Central Railways plc for partial, conditional or absolute waiver from compliance with certain application requirements under the Transport and Works Act 1992 that he is considering. [12537]

  Mr. Watts
  Central Railway plc has withdrawn the waiver applications previously before my right hon. Friend the Secretary of State. I understand that it intends to re-apply for waivers in a modified form. It would not be appropriate in the circumstances to reveal details of the 804
  withdrawn waiver applications but copies of any subsequent such applications will be placed in the Library of the House.

  Mr. Chidgey
  To ask the Secretary of State for Transport, pursuant to his answer of 22 January,Official Report, column 36, when he reached the conclusion that the applications by Central Railways plc were of national importance under the Transport and Works Act 1992. [12536]

  Mr. Watts
  My right hon. Friend the Secretary of State has reached no such conclusion. My answer, like the hon. Member's question, dealt with what would happen in the event of such a conclusion being reached. From what we know of the proposal, this conclusion seems very likely, but it cannot be reached unless and until a formal application is made under the Transport and Works Act 1992.

  Mr. Chidgey
  To ask the Secretary of State for Transport, pursuant to his answer of 22 January,Official Report, column 36, if he will make a statement on the consultations with local planning authorities and other bodies which Central Railways plc is required to make under the Transport and Works Act 1992 rules; and what monitoring he has carried out as to whether the consultations have been carried out to the satisfaction of the local authorities concerned. [12538]

  Mr. Watts
  Rule 3 of the Transport and Works (Applications and Objections Procedure) Rules 1992 (SI 1992 No. 2902) sets out the pre-application consultation and notification requirements. The applicant must provide with the TWA application copies of all statements of views obtained from local planning authorities under rule 3(1) and evidence by affidavit of compliance with the notification requirements under rule 3(2) and 3(3).

  Driving Instructors
  Mr. Alex Carlile
  To ask the Secretary of State for Transport if he will make a statement on the policy of the Driving Standards Agency concerning driving instructors with criminal convictions. [12414]

  Mr. Norris
  Under part V of the Road Traffic Act 1988, the registrar of approved driving instructors, who is responsible for the administration of the ADI register, has to be satisfied that an instructor is a "fit and proper person". Any instructor who is aggrieved by the registrar's decision to remove his name from the register can appeal to the Secretary of State, which appeal is heard by an independent appeal board. That strikes a reasonable balance between the rights of the individual and the protection of the learning public.

  Mr. Carlile
  To ask the Secretary of State for Transport if he will make a statement on the proposed deregulation of the Driving Standards Agency and its future monitoring of driving instructors. [12415]

  Mr. Norris
  There are no plans to deregulate the Driving Standards Agency and it will continue to be responsible for the statutory register of approved driving instructors and for the conduct of driving tests.

  Mr. Carlile
  To ask the Secretary of State for Transport what proposals he has to ensure that persons convicted of offences of indecency are not permitted to work as driving instructors; and if he will make a statement. [12413]
  805
  Mr. Norris
  Under part V of the Road Traffic Act 1988, the registrar of approved driving instructors, who is responsible for the administration of the ADI register, has to be satisfied that an instructor is a "fit and proper person". If, for example, following the criminal conviction of an instructor, the registrar is no longer satisfied on this score, he can remove that person's name from the register.

  Mr. Carlile
  To ask the Secretary of State for Transport if he will make it his policy to restrict persons convicted of indecency from setting up driving schools to teach driving practice or theory; and if he will make a statement. [12416]

  Mr. Norris
  In the environment in which ordinary driving instruction takes place, it is sensible that the instructor should be subject to vetting as to previous convictions, and so on. However, there is no obvious need for a special conduct regime for classroom tuition services since the isolated and relatively vulnerable circumstances of one-to-one in a car do not arise.

  Channel Tunnel Rail Link
  Mr. Chidgey
  To ask the Secretary of State for Transport what estimate he has made of the total cost to public funds of the high speed rail link between London and the channel tunnel; and if he will make a statement. [12170]

  Mr. Watts
  The amount of public sector support which the Government will make available for this project will depend on the outcome of the competition currently under way to select a private sector promoter. We anticipate that the contribution will be substantial. We hope to announce the winner of the competition shortly.

  Driving Licence Fraud
  Mr. Chidgey
  To ask the Secretary of State for Transport what steps are being taken to combat driving licence fraud; and if he will make a statement. [12169]

  Mr. Norris
  Photographs are to be added to driving licences. This will help eliminate misuse of licences and impersonation at driving tests.

  Railway Line Repairs (Dawlish)
  Mr. Jamieson
  To ask the Secretary of State for Transport, what estimate he has made of the cost of repairs required to the railway line at Dawlish. [12524]

  Mr. Watts
  [holding answer 30 January 1996]: None. However, Railtrack informs me that £500,000 per year is spent on maintenance of the Dawlish sea wall, with a further £200,000 this year for repairs necessitated by the poor weather conditions in January.

  Public Service Vehicle Licences
  Mr. Allen
  To ask the Secretary of State for Transport how many public service vehicle operators' licences have been(a) applied for, (b) issued, (c) objected to by (i) the police, (ii) the public and (iii) others, (d) issued and (e) withdrawn by the authorities in the latest year for which figures are available; and if he will make a statement on the trends in each category in the last five years. [12869]
  806
  Mr. Norris
  The information on applications, issues of licences, and withdrawals for 1994–95, the latest figures which are available, is contained in annexes 1 and 2 of the annual reports of the traffic commissioners 1 April 1994 to 31 March 1995, copies of which are available in the Library. In that year, there were five objections to licence applications, of which two came from the police, none from the public, and three from others.

  Over the last five years, the number of applications and the number of licences issued have shown a slow but steady growth, punctuated, in both categories, by a sharp reduction in 1994–95. The number of objections received has remained roughly constant.

  As for the number of withdrawals, 1990–91 showed a high, and the subsequent four years have produced lower, broadly similar figures.

  Mr. Allen
  To ask the Secretary of State for transport what computer links exist between his Department, the police, the traffic commissioners and others to cross check public service vehicle operators' applications in order to detect unsuitable applicants, with particular reference to those with a criminal record of offences against children; and if he will make a statement. [12874]

  Mr. Norris
  There are no computer links between the traffic area offices and the police. All applications for public service vehicle operators' licences are published in advance of the grant of a licence and circulated to the police, who have a statutory right of objection to a licence being granted on the grounds that the requirement of good repute has not been satisfied.

  The applicant must declare on his application form any relevant convictions that he or any of his employees has had in the last five years. Any person who knowingly makes a false statement for the purpose of obtaining a licence is liable to a fine and the revocation or suspension of the licence.

  Rail Tickets (Inter-availability)
  Ms Short
  To ask the Secretary of state for Transport what instructions he has given to the Director of Passenger Rail Franchising regarding the inter-availability of tickets between destinations where more than one route is available and services on these routes are provided by different train operating companies. [12844]

  Mr. Watts
  Paragraphs 29 of the objectives, instructions and guidance to the franchising director instruct the franchising director that:"Where a railway passenger journey could be made using services operated by different franchisees you are to require the franchisees to offer tickets which are inter-available between their services where you believe the benefits of doing so will outweigh the likely benefits of price competition and service diversity".

  The franchising director will require inter-available tickets between the different operators on most routes, thereby essentially safeguarding the existing inter-availability of tickets for British Rail services on permitted routes. He will lift the requirement only if this would be in the interests of price competition and service diversity. While inter-availability is required, operators will be permitted to offer additional, non-inter-available tickets which trade flexibility for a cheaper price.

  Heavy Goods Vehicle Drivers
  Mr. Hanson
  To ask the Secretary of State for Transport what representations he has received about the regulation of HGV drivers employed by HGV driver agencies; if he will consult on proposals to regulate HGV driver agencies; and if he will make a statement. [12437]

  Mr. Norris
  I have received one letter on this issue. Employment agencies for HGV drivers are already regulated. They are subject to the standards of conduct in the Employment Agencies Act 1973 and the Conduct of Employment Agencies and Employment Businesses Regulations 1976, which are enforced by the employment agency standards office of the Department of Trade and Industry.

  West Coast Main Line
  Mr. Chris Davies
  To ask the Secretary of State for Transport if the transmission-based signalling system proposed for the west coast main line will be compatible with the proposed European train control system. [12282]

  Mr. Watts
  The final form of the European train control system will depend on the outcome of the current development work. However, the transmission-based signalling system proposed for the west coast main line is expected to be compatible with ETCS principles.

  Mr. Davies
  To ask the Secretary of State for Transport when it is expected that a proven European train control system will be ready for production; and when the transmission-based signalling system proposed for the west coast main line will be ready for installation. [12281]

  Mr. Watts
  The availability of a proven European train control system will depend on the outcome of research trials currently being undertaken within the EC's fourth framework programme for research and development. The trials are not due to be completed until around the year 2000. Railtrack will let the development contract for the transmission-based signalling system for the west coast main line during the first quarter of this year. Railtrack expects that a reliable signalling system can be developed within the time necessary for the modernisation works.

  Marine Pollution (Penalties)
  Mr. Allen
  To ask the Secretary of State for Transport what guidance is given to magistrates on the appropriate level of fines under the Merchant Shipping (Prevention of Pollution) Regulations 1983. [12154]

  Mr. Norris
  None.

  Mr. Allen
  To ask the Secretary of State for Transport how many convictions there have been made under the Merchant Shipping (Prevention of Pollution) Regulations 1983 in each of the years for which figures are available; and what was the average fine each year. [12153]

  Mr. Norris
  Precise information on individual fines imposed is not held centrally. Estimates are, however, available from the advisory committee on pollution of the sea.

  Mr. Allen
  To ask the Secretary of State for Transport when he intends to bring into force proposals authorised in the Merchant Shipping (Prevention of Pollution) (Law of the Sea Convention) Order 1995. [12191]
  808
  Mr. Norris
  Subject to approval of the Merchant Shipping (Prevention of Pollution) (Law of the Sea Convention) Order 1995 by the Privy Council, we would hope to bring into force regulations extending jurisdiction over oil pollution before the end of March. Regulations on pollution by garbage and noxious liquid substances should follow shortly afterwards.

  Mr. Allen
  To ask the Secretary of State for Transport what is the maximum fine for illegal dumping at sea; and how many times it has been levied since 1983. [12152]

  Mr. Norris
  There is no maximum fine for convictions secured in the crown court. For convictions in magistrates courts, the maxima are £50,000 for illegal discharges of oil, and £5,000 for other discharge offences. Precise information on individual fines imposed is not available. My noble Friend the Minister for Aviation and Shipping announced on 24 January the Government's intention to seek a five-fold increase in these maxima to £250,000 and £25,000 respectively.

  Marine Safety Agency
  Mr. Allen
  To ask the Secretary of State for Transport what safeguards exist to ensure staff on short-term contracts with the Marine Safety Agency do not have a conflict of interests with their other employment. [12195]

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

  Letter from R.M. Bradley to Mr. Graham Allen, dated 31 January 1996:
  The Secretary of State for Transport has asked me to respond to your Question about staff on short term contracts.
  The people employed by the Marine Safety Agency on casual or short fixed term contracts do not have other employment so there is no conflict of interests.

  Road Taxes
  Mr. Allen
  To ask the Secretary of State for Transport what is his policy on different road taxes for road use in different conditions. [12012]

  Mr. Norris
  Road tax decisions are primarily matters for the Chancellor of the Exchequer.

  British Bus
  Mr. Allen
  To ask the Secretary of State for Transport what reports he has received concerning payments by the chief executive of British Bus to Ray McEnhill, National Express; and if he will make a statement. [12138]

  Mr. Norris
  I have seen press reports, and have no comment to make.

  Trunk Roads, London
  Ms Glenda Jackson
  To ask the Secretary of State for Transport (1) what allocation has been made for maintenance of the trunk road network within the Greater London area for the financial years(a) 1995–96, (b) 1996–97 and (c) 1997–98; [11244]

  (2) what is the current maintenance backlog on the trunk road network in Greater London. [11225]
  809
  Mr. Norris
  I have asked the chief executive of the Highways Agency to write to the hon. Member.

  Letter from Lawrie Haynes to Ms Glenda Jackson, dated 31 January 1996:
  The Secretary of State for Transport has asked me to reply to your recent questions about the allocation of maintenance funds for trunk roads within the Greater London area and the current backlog of maintenance on the network.
  This financial year (95/96) my Agency is forecasting to spend £51.4m (approx) on the maintenance of London's trunk road network. We are currently working on the allocation of next year's funds, in the light of last November's PES settlement. I will advise you on next year's funding when those allocations have been made. It is too early to forecast how much will be spent in the year 97/98.
  There is an on-going programme of maintenance for London's trunk road network. Work is brought forward in order of priority against an on-going programme of condition assessment and as such there is no significant backlog of highway maintenance.

  A102M
  Ms Gordon
  To ask the Secretary of State for Transport (1) what was the original estimated cost of the current works at Cotton street/Brunswick road/A102M improvements; what is the current estimated cost of the works; what factors underlie the current overrun by the contractors; if the contractors will be subject to penalty clauses; and if these will be implemented; [12231]

  (2) what advantages in traffic flows the Highways Agency estimates will occur on completion of the contract for the works at Cotton street/Brunswick road/A102M improvements; what assessment has been made of the advantages for local residents from the scheme; if the contract for works at Cotton street/Brunswick road/A102M improvement is being completed to its original specification; what is its estimated finish date; and what on site works have been carried out that relate to a third river crossing at Blackwall. [12232]

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

  Letter from Lawrie Haynes to Ms Mildred Gordon, dated 31 January 1996:
  The Secretary of State for Transport has asked me to reply to your recent questions about the Cotton Street/Brunswick Road/A102M improvement scheme.
  The tender sum for the contract was £5.1m, the current estimated cost of the works exceeds that but for commercial reasons I cannot yet say what that figure will be.
  The original completion date was 12 November 1995, with the likely completion date now being June 1996. There are a number of reasons for this delay including uncharted underground services, works carried out by the statutory undertakers running late, unforeseen ground conditions and piling obstructions.
  We have carefully considered and agreed to a 12 week extension of time on the contract. The decision on whether to implement penalty clauses on the contractor will depend on the actual completion date and on whether or not any further extensions of time are agreed.
  On completion of the contract, traffic will re-route from Abbott Road because there will be the provision of a right hand turn into St. Leonard's Road. There will be increased capacity on the road north of the junction and Docklands via Cotton Street.
  Local people will benefit from a reduction in levels of congestion. Al3 westbound traffic wishing to travel north on the A102 will now be able to do so thus relieving Abbott Road, a residential road with a poor record of traffic accidents. There will be a new traffic signals system at the junction between the A13, A102 and Cotton Street
  810
  with integrated pedestrian crossing facilities and widened central refuge islands. At various locations there will be a segregation of the footway from traffic with environmental screens, pedestrian barriers and landscaping and at crossings, we will provide specialised pavings to assist visually impaired people. Environmental screens will be provided between the A102 and adjacent residential properties and between the A102 and Culloden Primary School. The A13 subway will be reopened and existing subways will be refurbished. Safety is of course a prime concern and the scheme will reduce road traffic accidents over the next 30 years by nearly 200.
  The improvement scheme is being completed to its original specification.
  This scheme is a stand alone improvement and no works have been carried out that relate to a third river crossing.

HEALTH

  GP Budgets
  Mr. Milburn
  To ask the Secretary of State for Health what were the accumulated gross savings of general practitioner fundholders in each region as at 31 March 1995. [10935]

  Mr. Malone
  This information is not yet available.

  Pain Research Institute, Liverpool
  Mr. George Howarth
  To ask the Secretary of State for Health (1) what representations he has received about the proposed closure of the Pain Research Institute associated with Walton hospital, Liverpool; [12314]

  (2) what assessment he has made of the value of the work carried out by the Pain Research Institute in Liverpool, with particular reference to the links between the institute and the pain clinic at Walton hospital; [12313]

  (3) what action he (a) has taken and (b) proposes to take in order to assist in re-siting the Pain Research Institute to the Fazakerley hospital site in conjunction with the re-siting of Walton hospital there. [12315]

  Mr. Horam
  Ministers have received five letters on this subject. The Department recognises the importance of the Pain Research Institute and its close ties with the Walton Neurosciences trust. Representatives of the National Health Service executive, Walton Neurosciences trust and Aintree Hospitals NHS trust met on 26 January to discuss the institute's accommodation requirements and options for financing the relocation.

  MRSA Bacteria
  Mr. Sheerman
  To ask the Secretary of State for Health what guidelines his Department has issued to general practitioners and NHS hospitals regarding the methicillin-resistant staphylococcus aureus bacterium [12399]

  Mr. Horam
  Methicillin-resistant staphylococcus aureus is a problem largely confined to hospitals. Guidance on the control of MRSA in hospitals was circulated to the national health service in September 1994 under cover of EL(94)74, entitled "Improving the Effectiveness of the NHS". New advice on the surveillance of MRSA was included in guidance on
  811
  "Hospital Infection Control", published in March 1995 under cover of HSG(95)10. Copies of both documents are available in the Library.

  Mr. Sheerman
  To ask the Secretary of State for Health what plans his Department has to undertake further research into MRSA bacteria. [12336]

  Mr. Horam
  I refer the hon. Member to the reply that I gave to the hon. Member for Carmarthen (Mr. Williams) on 22 January 1996,Official Report, columns 15–16.

  Powered Wheelchairs
  Mr. Thurnham
  To ask the Secretary of State for Health (1) what are the criteria for qualifying for a publicly funded indoor/outdoor powered wheelchair in the United Kingdom; [12079]

  (2) what funding arrangements exist for indoor/outdoor powered wheelchair provision in the United Kingdom. [12078]

  Mr. Bowis
  It is for the national health service locally to decide which type of wheelchair is appropriate depending on local and personal circumstances. Responsibility for wheelchair provision in Wales, Scotland and Northern Ireland are matters for my right hon. Friends the Secretaries of State for Wales and for Scotland and for my right hon. and learned Friend the Secretary of State for Northern Ireland, respectively.

  Noise Levels (Hearing Damage)
  Ms Lynne
  To ask the Secretary of State for Health what research his Department has(a) commissioned and (b) evaluated into permanent hearing impairment caused by excessive noise levels faced by young people in places of public entertainment; and what plans his Department has to fund research into the level of hearing impairment amongst young people and the causes of such impairment. [12069]

  Mr. Bowis
  The Department has not commissioned any specific research into the effects of excessive noise levels in places of public entertainment, and has at present no plans to fund research into the level and causes of hearing impairment in young people.

  The health and safety of people attending places of public entertainment are subject to the general requirements of the Health and Safety at Work Etc Act 1974. This includes the risk of damage to people's hearing.

  Patients (Consent to Treatment)
  Mr. Harvey
  To ask the Secretary of State for Health what guidelines medical professionals work to in securing the informed consent of patients to undergo surgery or similar treatment, with Particular reference to information provided on success rates for the relevant treatment; and if the guidelines indicate whether the success rate figures they give should be(a) national, (b) local to the hospital or unit or (c) individual to the surgeon or professional and (d) any combination of these. [12499]

  Mr. Horam
  Medical professionals use guidance issued by the medical royal colleges as the basis for obtaining a patient's consent to treatment. The General Medical Council has also issued guidance to all doctors 812
  on the basis for obtaining a patient's consent to treatment in its publication, "Duties of a doctor". This emphasises the need to respect the right of patients to be fully involved in decisions about their care.

  Such guidance contains no information about success rates for treatment.

  General Osteopathic Council
  Mr. Lidington
  To ask the Secretary of State for Health if he is yet in a position to announce the membership of the first General Osteopathic Council. [13369]

  Mr. Dorrell
  I am pleased to announce the membership designate of the first General Osteopathic Council is as follows:Chairman (lay member): Mr. Simon Fielding OBE: Current Chairman of the General Council and Register of Osteopaths
  Osteopathic members (all practising osteopaths)

  Dr. John G. Armitstead, MA, MRCP (UK) DO

  Mr. John B. Barkworth, DO

  Miss Susan Farwell, DO

  Mr. Gerry Gajadharsingh DO

  Mr. Maurice Hills DO

  Mrs. Jane Langer DO

  Mr. John Lant DO

  Mr. Graham Mason DO

  Mrs. Susan Pawsey MSc DO

  Mr. John Roberts MSc DO

  Mr. Philip Tanswell DO

  Mr. Nicholas Woodhead DO

  Education members

  Mr. Jonathan Hobbs DO

  Mr. Gregory Sharp DO

  Miss Sarah Wallace DO

  Dr. Briaan Jolly BSc, MA(Ed), PhD

  Lay members

  Mr. T. Nigel Clarke BA(Hons): Director, GLW Government Relations, and Chairman Notiondouble Ltd.

  Mr. Alan Kershaw BA(Hons) MA: Assistant Registrar, General Medical Council

  Mrs.Rita Lewis MSc(Econs): Health Policy Consultant/Lecturer, Member of UKCC

  Mr. David Phillips OBE, BDS: Dental Director and Secretary, The Medical Protection Society Ltd.

  Mrs. Elizabeth Southey: National Chairman of the National Federation of Women's Institutes

  Mrs. Deborah Todman LLB(Hons) MRAD: Barrister

  Mr. Alan Lettin BSc., MS, FRCS: Vice President, Royal College of Surgeons (England)

  Consultant Orthopaedic Surgeon.

  The chairman and membership will meet shortly to begin the preliminary work of drawing up a business plan for the new GOsC and the outline of the necessary structures for the administration of the statutory registration scheme for osteopaths. As soon as this preliminary work is complete, the first of the commencement orders will be made to bring the essential elements of the Osteopaths Act into force—including the formal appointment of the GOsC by the Privy Council.

  Operations (Women)
  Ms Jowell
  To ask the Secretary of State for Health what is the total number of women by health authority waiting for(a) a hysterectomy osperation, (b) a mastectomy operation and (c) a hip replacement operation; and how many have been waiting longer than (i) three months, (ii) six months, (iii) nine months and (iv) 12 months. [11491]

  Mr. Horam
  This information is not available centrally.

  Cystic Fibrosis
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Health how many(a) infants and (b) people in total were recorded as suffering from cystic fibrosis in each standard region in each of the last three years; and if he will make a statement. [12777]

  Mr. Horam
  Information about the prevalence of cystic fibrosis is not available centrally. Available information about national health service treatment, differentiating between those aged under one year and others, is shown in the table.

  Finished consultant episodes (ordinary admissions and day cases combined) in NHS hospitals in England—main diagnosis cystic fibrosis

  1991–92

  0–1 year

  Over 1 year

  All ages

  Northern

  35

  410

  445

  Yorkshire

  67

  435

  502

  Trent

  41

  478

  519

  East Anglian

  24

  218

  242

  North west Thames

  28

  137

  165

  North east Thames

  26

  82

  108

  South east Thames

  23

  154

  177

  South west Thames

  17

  238

  255

  Wessex

  17

  225

  242

  Oxford

  21

  171

  191

  South Western

  44

  196

  240

  West Midlands

  66

  585

  651

  Mersey

  30

  402

  432

  North Western

  32

  727

  760

  SHAs

  283

  876

  1,158

  England

  753

  5,333

  6,087

  1992–93

  Northern

  21

  344

  365

  Yorkshire

  85

  448

  533

  Trent

  42

  428

  470

  East Anglian

  20

  248

  268

  North west Thames

  5

  97

  102

  North east Thames

  13

  98

  111

  South east Thames

  45

  175

  220

  South west Thames

  13

  244

  256

  Wessex

  28

  335

  364

  Oxford

  32

  164

  196

  South Western

  28

  252

  280

  West Midlands

  90

  728

  817

  Mersey

  34

  305

  339

  814

  Finished consultant episodes (ordinary admissions and day cases combined) in NHS hospitals in England—main diagnosis cystic fibrosis

  1991–92

  0–1 year

  Over 1 year

  All ages

  North western

  66

  651

  717

  SHAs

  60

  2,169

  2,229

  England

  581

  6,687

  7,268

  1993–94

  Northern

  13

  204

  216

  Yorkshire

  62

  1,129

  1,191

  Trent

  71

  449

  520

  East Anglian

  16

  200

  216

  North west Thames

  0

  82

  82

  North east Thames

  26

  86

  112

  South east Thames

  28

  230

  259

  South west Thames

  13

  276

  288

  Wessex

  25

  358

  383

  Oxford

  8

  260

  268

  South Western

  8

  275

  283

  West Midlands

  71

  753

  824

  Mersey

  49

  367

  416

  North western

  20

  465

  486

  SHAs

  48

  1,428

  1,476

  England

  458

  6,562

  7,020

  Note

  Figures may not total due to rounding.

  Source

  Hospital Episode Statistics.

WALES

  Health Authorities (Resources)
  Sir Wyn Roberts
  To ask the Secretary of State for Wales what decisions he has reached about the allocation of resources to the new health authorities in Wales for 1996–97. [13343]

  Mr. Hague
  I announced on 13 December that I had decided to provide an additional £84 million for the NHS in Wales for 1996–97. This brings total NHS spending to £2,274 million. Within this sum, I propose to allocate £1,587 million to hospital, community and the cash-limited element of the family health services. Subject to approval of the relevant supply estimate, this amount will be distributed as follows:

  The new health authorities will receive £1,491.6 million for revenue purposes. This is an increase of £55 million or 3.85 per cent. over 1995–96 plans, and 1.1 per cent. in real terms. In addition, authorities and trusts will be expected to generate efficiency savings of at least 3 per cent. This amounts to £40 million including a further £3.25 million savings in managements costs. These savings, together with the £55 million cash increase, will be available to meet inflationary and other pressures and enable further investment to be made in patient care.

  Health authorities and NHS trusts will also receive £95.8 million for capital investment. They are also expected to receive additional receipts from sales of surplus land. These additional resources will be available for reinvestment in capital development. In additional to

  815
  public sector capital spending, I expect the NHS in Wales to benefit significantly next year from private sector capital investment under the private finance initiative.

  I want the NHS in Wales to see PFI as the main source of funding for capital investment. It offers a unique opportunity to bring forward capital projects which are additional to existing public expenditure plans.

  Details of the planned allocations to the new health authorities, which come into being on 1 April 1996 and the provisional external financing limits for NHS trusts is contained in a statement which has been placed in the Library of the House.

  Valuation Office, Bangor
  Mr. Wigley
  To ask the Secretary of State for Wales what representations he has received against the possible transfer of work from the valuation office in Bangor to offices outside Gwynedd; and if he will make a statement. [12100]

  Mr. Angela Knight
  I have been asked to reply.

  To date, representations have been received from members of staff of the valuation office in Bangor and a constituency Member of Parliament.

  Consultation has recently commenced with members of staff and their trades unions and will also be conducted with national representatives of the valuation profession and other bodies with an interest in the future of the valuation office review.

  Consultation is expected to be completed by summer 1996 and the outcome announced in due course.

  Hospitals
  Mr. Llwyd
  To ask the Secretary of State for Wales how many general hospitals there were in Wales in 1980, 1990 and 1995; and if he will make a statement. [10744]

  Mr. Richards
  The information requested is contained in volumes 12 and 20 of "Health and Personal Social Services Statistics Wales" and in "Health Statistics Wales 1995", copies of which are in the Library of the House.

  Dentists
  Mr. Llwyd
  To ask the Secretary of State for Wales (1) how many dentistry practices there were undertaking NHS treatment in 1993 and 1994 in Gwynedd; [10758]

  (2) how many dentistry practices there were in Gwynedd in 1992, 1993, 1994 and 1995; and how many there are currently. [10757]

  Mr. Richards
  Information on the number of dentistry practices is not available centrally. However, the number of principal dental practitioners treating some NHS patients is given in the following list, a principal dental practitioner would be the head of a practice, although two or more may practise together. The list includes only principals who carry out the majority of their work in Gwynedd. There may also be other principals who carry out some work in Gwynedd.
  816 Number of principal dental practitioners, treating some NHS patients, in Gwynedd

  30 September 1992: 63

  30 September 1993: 65

  30 September 1994: 65

  30 September 1995: 62 (latest available)

  Mr. Llwyd
  To ask the Secretary of State for Wales (1) how many dentistry practices undertook NHS treatment in Clwyd in (i) 1991, (ii) 1992 and (iii) 1993; and if he will make a statement; [10674]

  (2) how many dentistry practices there are in Clwyd who undertake NHS treatment; and if he will make a statement. [10759]

  Mr. Richards
  Information on the number of dentistry practices is not available centrally. However the number of principal dental practitioners treating some NHS patients is given in the following list, a principal dental practitioner would be the head of a practice, although two or more may practise together. The list includes only principals who carry out the majority of their work in Clwyd. There may also be other principals who carry out some work in Clwyd.

  Number of principals dental practitioners, treating some NHS patients, in Clwyd:

  30 September 1991: 99

  30 September 1992: 95

  30 September 1993: 107

  30 September 1994: 108

  30 September 1995: 115

  Mr. Wigley
  To ask the Secretary of State for Wales how many dentists in Gwynedd are currently providing NHS dental service; and what was the figure before the introduction of his initiative. [11964]

  Mr. Hague
  At 30 September 1995, there were 65 dentists—62 of whom were principals—providing a NHS dental service in Gwynedd. Only those dentists who carry out the majority of their work in Gwynedd have been included in the figures. More recent figures are not yet available.

  Llanelli (Development)
  Mr. Denzil Davies
  To ask the Secretary of State for Wales what assessment he has made of the impact of the Millennium Commission's grant towards the development of the Llanelli coastal park on the joint venture agreement between the Welsh Development Agency and Llanelli borough council. [11830]

  Mr. Hague
  I welcome the Millennium Commission's decision to support the development of Llanelli coastal park. It is for the Llanelli joint venture partners to take account of the decision in their future plans.

  Positive about Disabled People Symbol
  Mr. Barnes
  To ask the Secretary of State for Wales if he will list for his Department and each of the agencies for which he is responsible if it uses the Employment Service's positive about disabled people symbol for(a) external recruitment and (b) internal recruitment and promotion. [11917]
  817
  Mr. Richards
  The Welsh Office and Cadw use the Employment Service's positive about disabled people symbol for external recruitment and work to its principles for internal promotions and recruitment.

  Education Authority Budgets
  Mr. Llew Smith
  To ask the Secretary of State for Wales what proportion of the budgets of education

  1995–96 Budgeted expenditure on education1

  Schools expenditure2

  Non-schools expenditure

  As a percentage of total eduction expenditure

  £per pupil3

  As a percentage of total education expenditure

  £per pupil3

  County council

  Clwyd

  95

  2,189

  4

  101

  Dyfed

  93

  2,386

  7

  177

  Gwent

  91

  2,161

  9

  211

  Gwynedd

  92

  2,351

  7

  172

  Mid Glamorgan

  92

  2,245

  8

  197

  Powys

  91

  2,480

  9

  233

  South Glamorgan

  89

  1,998

  11

  238

  West Glamorgan

  93

  2,271

  7

  172

  Wales

  92

  2,227

  8

  186

  Source:

  Local authority returns.

  Notes:

  1Excludes expenditure on grant maintained schools and mandatory student awards that are 100 per cent. funded by central government.

  2Includes expenditure on management and support services allocated by authorities to schools. Incudes home teaching and individual teaching at other establishments e.g. hospitals and special units. Excludes expenditure on school catering which is included under non-schools expenditure.

  3Based on provisional full-time equivalent pupil numbers as at January 1995.

  Teachers' Pay
  Mr. Barry Jones
  To ask the Secretary of State for Wales what is the average salary of a class teacher in Wales in the(a) nursery, (b) infant, (c) primary and (d) secondary sectors. [11708]

  Mr. Richards
  The average salaries for full-time classroom teachers in maintained—including grant-maintained—nursery, primary and secondary schools in Wales as at 31 March 1994 are as follows:

  Nursery £

  Infants £

  Other primary £

  Secondary (excluding sixth-form colleges) £

  19,100

  18,700

  18,700

  29,600

  Nurses
  Mr. Barry Jones
  To ask the Secretary of State for Wales what measures he is taking to increase the recruitment of nurses. [12007]

  Mr. Richards
  It is a matter for NHS trusts and other employers to recruit the number of nurses they require to provide services.

  Hospital Closures
  Mr. Barry Jones
  To ask the Secretary of State for Wales how many hospitals were closed in (i) 1992,
  818
  authorities, in Wales is allocated to (a) schools and (b) non-school expenditure; and how much money this represents per school pupil in each case. [10922]

  Mr. Richards
  Information on county councils' budgeted expenditure for 1995–96 on education services is given in the following table.

  (ii) 1993, (iii) 1994 and (iv) 1995 giving in each case their location. [12005]

  Mr. Richards
  The information is given in the following table. However since 1992 one hospital has also opened, in Clwyd.

  Hospital

  Location

  Closed in 1992:

  Catherine Gladstone

  Clwyd

  Talgarn

  Mid Glamorgan

  Children's ENT

  South Glamorgan

  Closed in 1993:

  Druid

  Gwynedd

  Garth Anghirad

  Gwynedd

  Llwyn View

  Gwynedd

  Pontypool and District

  Gwent

  Energlyn

  Mid Glamorgan

  Coed Du

  Clwyd

  Closed in 1994:

  St. David's

  Powys

  Mount Pleasant

  West Glamorgan

  Parc

  Mid Glamorgan

  St. Lawrence

  Gwent

  Port Talbot

  West Glamorgan

  Alit yr yn

  Gwent

  St. David's

  Gwynedd

  Broughton

  Clwyd

  Closed in 1995:

  Stanley Sailors

  Gwynedd

  Pen y Fai

  Mid Glamorgan

  North Wales

  Clwyd

  819
  Mr. Jones
  To ask the Secretary of State for Wales how many wards were closed in (i) 1992, (ii) 1993, (iii) 1994 and (iv) 1995. [12004]

  Mr. Richards
  The information requested is not available centrally.

  Mr. Jones
  To ask the Secretary of State for Wales how many(a) hospital beds and (b) acute hospital beds were closed in (i) 1992, (ii) 1993, (iii) 1994 and (iv) 1995. [12003]

  Mr. Richards
  Information relating to the actual number of beds closed is not collected centrally. However, the average daily number of available beds in each of the last four years is given in the following table.

  All hospital beds

  Acute hospital beds

  1991–92

  18,640

  8,799

  1992–93

  18,078

  8,651

  1993–94

  17,475

  8,441

  1994–95

  16,834

  8,479

  Welsh Language
  Mr. Wigley
  To ask the Secretary of State for Wales if he will make an order under section 6(1)(o) to extend the provisions of the Welsh Language Act 1993 to those bodies identified by the Welsh Language Board as appropriate to the purposes of the Act but not currently within its ambit. [11974]

  Mr. Hague
  I intend to make an order under section 6 of the Act later this year. Which bodies are to be designated as public bodies under the terms of the Act is a matter still under consideration.

  Anaesthetics and Psychiatry Posts
  Mr. Barry Jones
  To ask the Secretary of State for Wales what percentage of(a) anaesthetics and (b) psychiatry posts are currently unfilled; and if he will make a statement. [12008]

  Mr. Richards
  Information on medical staff in the NHS in Wales is collected by means of an annual census of staff in post at 30 September. The latest available information, which relates to whole-time equivalent numbers at 30 September 1994, is given in the following table.

  Percentage of posts not occupied by a permanent holder

  Filled by a locum

  Not filled by a locum

  Anaesthetics

  0.6

  1.4

  Psychiatry1

  0.7

  0.7

  1Includes the specialties of mental handicap, mental illness, child and adolescent psychiatry, forensic psychiatry, psychotherapy and old age psychiatry.

  Private Hospitals and Clinics
  Mr. Barry Jones
  To ask the Secretary of State for Wales how many private hospitals and clinics there are currently(a) in Wales, and (b) in each of the health districts. [12006]
  820
  Mr. Richards
  The latest available information, which relates to 31 March 1995, is given in the following table.

  Health district

  Private hospitals

  Private clinics

  Clwyd

  1

  1

  East Dyfed

  1

  1

  Gwent

  2

  1

  Gwynedd

  1

  1

  Mid Glamorgan

  —

  —

  Pembrokeshire

  —

  —

  Powys

  —

  —

  South Glamorgan

  1

  2

  West Glamorgan

  1

  —

  Wales

  7

  7

  Training for Work Programmes
  Mr. Morgan
  To ask the Secretary of State for Wales, pursuant to his answer of 14 December,Official Report, column 780, how many trainees (a) in total and (b) in each training and enterprise council area for whom a first stage payment is made are still in employment eight weeks later. [12460]

  Mr. Hague
  Information on individual trainees is not collected in the format requested and could be collected only at disproportionate cost. However aggregated information is available on the claims made by TECs for first and second stage job outcome payments and this has been provided in the following table. To take account of the time lag in claiming second stage payments, information has been provided on the first stage payments to the end of the second quarter, 10 September 1995, and the second stage job outcome payments to the end of the third quarter, 31 December 1995. The earliest opportunity for claiming the latter payments is eight weeks after the payment of first stage job outcomes.

  Training for work job outcome payments made 27 March 1995 to 31 December 1995

  TEC

  First stage payment

  Second Stage payment

  Gwent

  484

  434

  Mid Glamorgan

  905

  615

  North East Wales

  310

  66

  Powys

  152

  92

  South Glamorgan

  467

  340

  Targed

  231

  165

  West Wales

  736

  493

  Total

  3,285

  2,205

  Source:

  TEC claims: first stage payments to 10 September 1995 second stage to 31 December 1995.

  Mr. Morgan
  To ask the Secretary of State for Wales, pursuant to his answer of 14 December,Official Report, column 780, if he will publish by individual TEC areas a breakdown of the NVQ levels attained by trainees undertaking training for work programmes. [12459]

  Mr. Hague
  The information requested is contained in the following table.
  821

  Training for work NVQ achievement by level 27 March 1995 to 3 December 1995

  NVQ's

  Gwent

  Mid Glamorgan

  North-east Wales

  Powys

  South Glamorgan

  Targed

  West Wales

  Total

  Sub Level 1

  123

  101

  2

  4

  52

  22

  7

  311

  Level 1

  336

  248

  60

  23

  206

  121

  431

  1,425

  Level 2

  294

  415

  123

  52

  371

  229

  523

  2,007

  Level 3

  71

  48

  28

  50

  36

  109

  45

  387

  Level 4

  10

  30

  0

  3

  44

  43

  2

  132

  Level 4+

  0

  0

  0

  1

  0

  2

  0

  3

  Total

  834

  842

  213

  133

  709

  526

  1,008

  4,265

  TEC management information statistics.

  Mr. Morgan
  To ask the Secretary of State for Wales, pursuant to his answer of 14 December,Official Report, column 780, what percentage the long-term unemployed represent of (a) entrants to training for work, (b) those for whom a first stage payment is made and (c) those still in employment eight weeks later (i) in total and (ii) by individual TEC areas. [12461]

  Mr. Hague
  The information requested is not available in the form requested.

  Llay Park Infants School
  Mr. Barry Jones
  To ask the Secretary of state for Wales if he will make extra moneys available to Clwyd local education authority to enable Llay Park infants school to be rebuilt. [12426]

  Mr. Richards
  My right hon. Friend is making available more than £508 million for local authority capital spending in 1996–97. It is for individual local authorities to determine how the resources that are made available are allocated between services, including education, in the light of their statutory responsibilities and their perception of local needs and priorities.

  Traditional Geographical Counties
  Mr. Win Griffiths
  To ask the Secretary of State for Wales what representations he has received about maintaining the identity of the 13 traditional counties of Wales; and what response he has made. [12464]

  Mr. Gwilym Jones
  My right hon. Friend and I have received three representations, all from Mr. Peter Boyce of the Association of British Counties about promoting"the use of the 13 traditional counties as the main geographical areas in common parlance in Wales"

  I have written to Mr. Boyce, expressing our view that the new structure of 22 unitary authorities is that which best meets the needs of local government in Wales, but that it is for other institutions and organisations to consider what structure meets their needs.

  Mr. Alex Carlile
  To ask the Secretary of State for Wales what considerations he has given to reinstituting the 13 geographical counties as the standard geographical framework for Wales; and if he will make a statement. [12419]

  Mr. Hague
  None. I am not aware that there is such a thing as a standard geographical framework. The structure of 22 unitary authorities was decided upon by Parliament with regard to what is best for local government in Wales.
  822
  It is for other institutions and organisations to consider whether that structure meets their needs and those of their users, customers or associates.

  Mr. Carlile
  To ask the Secretary of State for Wales if he will make a statement on the future role of the 13 traditional geographical counties in Wales. [12417]

  Mr. Hague
  The Government acknowledge the continuing strength of the affection which many people in Wales have for the traditional 13 counties, which is expressed, for example, in the organisation of many sporting, social, voluntary and cultural societies on the basis of the traditional counties' boundaries. I see no reason why such arrangements should not continue.

  Cystic Fibrosis
  Mr. Ieuan Wyn Jones
  To ask the Secretary of State for Wales how many(a) infants and (b) adults were recorded as suffering from cystic fibrosis in each health authority, and for Wales as a whole for each of the last available three years; and if he will make a statement. [12776]

  Mr. Richards
  At present, information on the prevalence of cystic fibrosis in Wales is not held centrally. Information on the levels of cystic fibrosis reported by respondents to the Welsh health survey is being processed. Results from the survey are scheduled for publication in March 1996.

  Nursery Voucher Scheme
  Mr. Ron Davies
  To ask the Secretary of State for Wales if he will list the written representations that he has received in favour of the proposed nursery voucher scheme. [12859]

  Mr. Hague
  Since my hon. Friend the Under-Secretary of State's reply to the hon. Member for Ceredigion and Pembroke, North (Mr. Dafis) on 15 January 1996,Official Report, columns 379–80, we have received correspondence in support of the scheme from a parent expressing concern that the views of working mothers are being represented. The voucher scheme aims to provide choice of provision to such parents.

SOCIAL SECURITY

  Hand Arm Vibration Syndrome
  Mr. Dicks
  To ask the Secretary of State for Social Security if he will make a statement on the recommendations of the Industrial Injuries Advisory
  823
  Council regarding hand arm vibration syndrome; and if he will make a statement. [12912]

  Mr. Roger Evans
  My right hon. Friend the Secretary of State has given careful consideration to the recommendations in the Industrial Injuries Advisory Council's report "Hand Arm Vibration Syndrome (Vascular and Neurological Components Involving the Fingers and Thumb)", Cm 2844. The Government are not persuaded that the additional benefits to individuals would be sufficient to warrant the high administrative costs of implementing the council's recommendations. I am especially concerned about the costs associated with developing a usable, repeatable and acceptable test for diagnosing the condition and assessing a person's disability. I am confident that the council will continue its thorough work in monitoring the scientific advances and literature on this condition, as well as developments in diagnostic and assessment techniques. I will give careful consideration to any further advice it may provide.

  Burdens on Business
  Mrs. Lait
  To ask the Secretary of State for Social Security what plans he has to reduce burdens on business. [13225]

  Mr. Heald
  We plan to make two changes which, although in themselves small, will nevertheless contribute to our aim of reducing burdens on business.

  First, we have today published a consultation document, "Reducing Burdens on Business: Proposed Changes for Directors' National Insurance Contributions". Subject to the responses, we will consider the best way of making the necessary legislative change, including an order under the Deregulation and Contracting Out Act 1994. Today's document therefore constitutes formal consultation under section 3(1) of the Act. Responses to the document must be received no later than Friday 29 March 1996 when the consultation period will end.

  The document has been sent to 38 organisations in Great Britain—and a further 12 in Northern Ireland—seeking their views about proposals to modify the present

  Income support preserved rights cases with weekly accommodation charge above income support limits: women aged 60 and over in residential care homes

  A. By standard region and type of care

  Great Britain

  Wales

  Scotland

  England

  All residential care

  34,000

  2,000

  2,000

  31,000

  Type of care

  Elderly People

  15,000

  1,000

  1,000

  14,000

  Very dependent elderly

  15,000

  1,000

  1,000

  14,000

  Mental illness

  1,000

  —

  —

  1,000

  Mental handicap

  —

  —

  —

  —

  Drug or alcohol dependence

  1,000

  —

  —

  1,000

  Physical disability above pension age

  1,000

  —

  —

  1,000

  Any other category

  —

  —

  —

  —

  824
  rules under which directors and their employers pay national insurance contributions. The annual amount they are liable to pay will not change.

  Secondly, we propose to bring the regulations governing national insurance contributions into greater alignment with the PAYE tax system. As one of a number of similar changes from April 1996 we propose to adopt the Inland Revenue definition of a company in the regulation dealing with the treatment of payments made to certain professional advisor and nominee directors.

  Copies of the consultation document have been placed in the Library.

  Social Security Committee Report
  Mr. Nicholls
  To ask the Secretary of State for Social Security when he expects to publish his reply to the Social Security Committee's fifth report of Session 1995–96 "The Work of the Department of Social Security and its Agencies", HC 382. [13227]

  Mr. Lilley
  A Government response to the Social Security Committee's report "The Work of the Department of Social Security and its Agencies" has been published today. Copies have been placed in the Library.

  Income Support
  Sir Andrew Bowden
  To ask the Secretary of State for Social Security how many women aged 60 years and over receiving preserved rights to income support in(a) elderly people, (b) very dependent elderly, (c) mental illness, (d) mental handicap, (e) drug and alcohol dependence, (f) physical disability over pension age and (g) any other condition category had weekly charges above the income support limit by (i) 1 p to £13.10, (ii) £13.11 to £15, (iii) £15.01 to £25, (iv) £25.01 to £35, (v) £35.01 to £45, (vi) £45.01 to £55, (vii) £55.01 to £65, (viii) £65.01 to £75, (ix) £75.01 to £85, (x) £85.01 to £95, (xi) £95.01 to £105 and (xii) over £105.01 for (1) Greater London and (2) by English region, excluding Greater London, (3) England and (4) Great Britain. [7729]

  Mr. Roger Evans
  The information is not available in the format requested. Such information as is available is set out in the tables.
  825

  A. By standard region and type of care

  England

  Greater London

  South-east

  North

  Yorkshire and Humberside

  East Midlands

  East Anglia

  South-west

  West Midlands

  North-west

  All residential care

  2,000

  8,000

  2,000

  4,000

  2,000

  2,000

  4,000

  3,000

  4,000

  Type of cure

  Elderly people

  1,000

  4,000

  1,000

  2,000

  1,000

  1,000

  2,000

  1,000

  2,000

  Very dependent elderly

  1,000

  3,000

  1,000

  1,000

  1,000

  1,000

  2,000

  2,000

  2,000

  Mental illness

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Mental handicap

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Drug or alcohol dependence

  —

  1,000

  —

  —

  —

  —

  —

  —

  —

  Physical disability above pension age

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Any other category

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Source:

  Income Support Statistics Quarterly Enquiry November 1994.

  Notes:

  1. Figures are rounded to the nearest thousand. Due to rounding some totals may not tally.

  2. Sample size 5 per cent.

  3. "—" Denotes nil or negligible.

  4. Regions are Government Standard Statistical Regions.

  5. Regional figures quoted exclude cases with the Greater London Extension.

  B. By range of charge and type of care

  All residential care

  Elderly people

  Very dependent elderly

  Mental illness

  Mental handicap

  Drug or alcohol dependence

  Physical disability above pension age

  Any other category

  Cases with charges:

  Above weekly Income Support limit

  34,000

  15,000

  15,000

  1,000

  —

  1,000

  1,000

  —

  of which above weekly Income Support limit by:

  £0.01 to £13.10

  17,000

  6,000

  10,000

  —

  —

  —

  —

  —

  £13.10 to £15.00

  1,000

  —

  —

  —

  —

  —

  —

  —

  £15.01 to £25.00

  4,000

  2,000

  2,000

  —

  —

  —

  —

  —

  £25.01 to £35.00

  5,000

  3,000

  1,000

  —

  —

  —

  —

  —

  £35.01 to £45.00

  2,000

  1,000

  1,000

  —

  —

  —

  —

  —

  £45.01 to £55.00

  2,000

  1,000

  —

  —

  —

  —

  —

  —

  £55.01 to £65.00

  1,000

  1,000

  —

  —

  —

  —

  —

  —

  £65.01 to £75.00

  1,000

  —

  —

  —

  —

  —

  —

  —

  £85.01 to £95.01

  —

  —

  —

  —

  —

  —

  —

  —

  £95.01 to £105.00

  —

  —

  —

  —

  —

  —

  —

  —

  £105.01 and over

  1,000

  —

  —

  —

  —

  —

  —

  —

  Source:

  Income Support Statistics Quarterly Enquiry November 1994.

  Notes:

  1. Figures are rounded to the nearest thousand. Due to rounding some totals may not tally.

  2. Sample size 5 per cent.

  3. "—" Denotes nil or negligible.

  4. Regions are Government Standard Statistical Regions.

  5. Regional figures quoted exclude cases with the Greater London Extension.

  Sir Andrew Bowden
  To ask the Secretary of State for Social Security how many men in residential homes aged 65 years and over receiving preserved rights to income support in the(a) elderly people, (b) very dependent elderly, (c) mental illness, (d) mental handicap, (e) drug and alcohol dependent, (f) physical disability over pension age and (g) any other condition category had weekly charges above the income support limit by (i) £0.01 to £13.10, (ii) £13.11 to £15, (iii) £15.01 to £25, (iv) £25.01
  826
  to £35, (v) £35.01 to £45, (vi) £45.01 to £55, (vii) £55.01 to £65, (viii) £65.01 to £75, (ix) £75.01 to £85, (x) £85.01 to £95, (xi) £95.01 to £105 and (xii) £105.01 over; and if he will give this information for Greater London, by English region excluding Greater London, England as a whole and Great Britain. [7737]

  Mr. Evans
  The information is not available in the format requested. Such information as is available is set out in the table.
  827

  Income support preserved rights cases with weekly accommodation charge above income support limits: men aged 65 and over in residential care homes

  A. By standard region and type of care

  Great Britain

  Wales

  Scotland

  England

  All residential care

  9,000

  —

  1,000

  8,000

  Type of care

  Elderly People

  4,000

  —

  —

  4,000

  Very dependent elderly

  3,000

  —

  —

  2,000

  Mental illness

  1,000

  —

  —

  1,000

  Mental handicap

  —

  —

  —

  —

  Drug or alcohol dependence

  1,000

  —

  —

  1,000

  Physical disability above pension age

  —

  —

  —

  1,000

  Any other category

  —

  —

  —

  —

  A. By standard region and type of care

  England

  Greater London

  South-east

  North

  Yorkshire and Humberside

  East Midlands

  East Anglia

  South-west

  West Midlands

  North-west

  All residential care

  1,000

  2,000

  —

  1,000

  1,000

  —

  1,000

  1,000

  1,000

  Type of care

  Elderly people

  —

  1,000

  —

  —

  —

  —

  1,000

  —

  1,000

  Very dependent elderly

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Mental illness

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Mental handicap

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Drug or alcohol dependence

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Physical disability above pension age

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Any other category

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Source:

  Income Support Statistics Quarterly Enquiry November 1994.

  Notes:

  1. Figures are rounded to the nearest thousand. Due to rounding some totals may not tally.

  2. Sample size 5 per cent.

  3. "—" Denotes nil or negligible.

  4. Regions are Government Standard Statistical Regions.

  5. Regional figures quoted exclude cases with the Greater London Extension.

  B. By range of charge and type of care

  All residential care

  Elderly people

  Very dependent elderly

  Mental illness

  Mental handicap

  Drug or alcohol dependence

  Physical disability above pension age

  Any other category

  Cases with charges:

  Above weekly Income Support limit

  9,000

  4,000

  3,000

  1,000

  —

  1,000

  —

  —

  of which above weekly Income Support limit by:

  £0.01 to £13.10

  4,000

  1,000

  2,000

  —

  —

  —

  —

  —

  £13.10 to £15.00

  —

  —

  —

  —

  —

  —

  —

  —

  £15.01 to £25.00

  2,000

  1,000

  —

  —

  —

  —

  —

  —

  £25.01 to £35.00

  1,000

  1,000

  —

  —

  —

  —

  —

  —

  £35.01 to £45.00

  1,000

  —

  —

  —

  —

  —

  —

  —

  £45.01 to £55.00

  —

  —

  —

  —

  —

  —

  —

  —

  £55.01 to £65.00

  —

  —

  —

  —

  —

  —

  —

  —

  £65.01 to £75.00

  —

  —

  —

  —

  —

  —

  —

  —

  £75.01 to £85.00

  —

  —

  —

  —

  —

  —

  —

  —

  £85.01 to £95.00

  —

  —

  —

  —

  —

  —

  —

  —

  828 829

  B. By range of charge and type of care

  All residential care

  Elderly people

  Very dependent elderly

  Mental illness

  Mental handicap

  Drug or alcohol dependence

  Physical disability above pension age

  Any other category

  £95.01 to £105.00

  —

  —

  —

  —

  —

  —

  —

  —

  £105.01 and over

  —

  —

  —

  —

  —

  —

  —

  —

  Source:

  Income Support Statistics Quarterly Enquiry November 1994.

  Notes:

  1. Figures are rounded to the nearest thousand. Due to rounding some totals may not tally.

  2. Sample size 5 per cent.

  3. "—" Denotes nil or negligible.

  4. Regions are Government Standard Statistical Regions.

  5. Regional figures quoted exclude cases with the Greater London Extension.

  Sir Andrew Bowden
  To ask the Secretary of State for Social Security how many men in nursing homes aged 65 years and over receiving preserved rights to income support in(a) terminal illness, (b) physical disability over pension age, (c) drug and alcohol dependence, (d) mental handicap, (e) mental illness and (f) any other category had weekly charges above the income support limit by (i) £00.1 to £13.10, (ii) £13.11 to £15, (iii) £15.01 to £25,

  Income support preserved rights cases with weekly accommodation charge above income support limits: men aged 65 and over in nursing homes

  A. By standard region and type of care

  Great Britain

  Wales

  Scotland

  England

  All nursing homes

  9,000

  1,000

  1,000

  8,000

  Type of care

  Mental illness

  —

  —

  —

  —

  Drug or alcohol dependence

  —

  —

  —

  —

  Mental handicap

  —

  —

  —

  —

  Terminal illness

  3,000

  —

  —

  3,000

  Physical disability above pension age

  1,000

  —

  —

  1,000

  Any other category

  4,000

  —

  —

  4,000

  A. By standard region and type of care

  England

  Greater London

  South-east

  North

  Yorshire and Humberside

  East Midlands

  East Anglia

  South-west

  West Midlands

  North-west

  All nursing homes

  —

  1,000

  —

  1,000

  1,000

  —

  1,000

  1,000

  2,000

  Type of care

  Mental illness

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Drug or alcohol

  —

  —

  —

  —

  —

  —

  —

  —

  —

  dependence

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Mental handicap

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Terminal illness

  —

  —

  —

  —

  —

  —

  —

  —

  1,000

  Physical disability above pertsion age

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Any other category

  —

  —

  —

  1,000

  1,000

  —

  —

  —

  1,000

  Source:

  Income Support Statistics Quarterly Enquiry November 1994.

  Notes:

  1. Figures are rounded to the nearest thousand. Due to rounding some totals may not tally.

  2. Sample size 5 per cent.

  3. "—" Denotes nil or negligible.

  4. Regions are Government Standard Statistical Regions.

  5. Regional figures quoted exclude cases with the Greater London Extension.
  830
  (iv) £25.01 to £35, (v) £35.01 to £45, (vi) £45.01 to £55, (vii) £55.01 to £65, (viii) £65.01 to £75, (ix) £75.01 to £85, (x) £85.01 to £95, (xi) £95.01 to £105 and (xii) over £105.01 for (1) Greater London and (2) by English region, excluding Greater London, (3) England and (4) Great Britain. [7728]

  Mr. Evans
  Information is not available in the format requested. Such information as is available is set at in the table.
  831

  B. By range of charge and type of care

  All nursing homes

  Mental illness

  Drug or alcohol dependence

  Mental handicap

  Terminal illness

  Physical disability above pension age

  Any other category

  Cases with charges:

  Above weekly L. S. Limit

  9,000

  —

  —

  —

  3,000

  1,000

  4,000

  Of which above weekly is limit by:

  £0.01 to £13.10

  4,000

  —

  —

  —

  2,000

  1,000

  2,000

  £13.10 to £15.00

  —

  —

  —

  —

  —

  —

  —

  £15.01 to £25.00

  1,000

  —

  —

  —

  —

  —

  —

  £25.01 to £35.00

  1,000

  —

  —

  —

  1,000

  —

  —

  £35.01 to £45.00

  —

  —

  —

  —

  —

  —

  —

  £45.01 to £55.00

  —

  —

  —

  —

  —

  —

  —

  £55.01 to £65.00

  —

  —

  —

  —

  —

  —

  —

  £65.01 to £75.00

  —

  —

  —

  —

  —

  —

  —

  £75.01 to £85.00

  —

  —

  —

  —

  —

  —

  —

  £85.01 to £95.00

  —

  —

  —

  —

  —

  —

  —

  £95.01 to £105.00

  —

  —

  —

  —

  —

  —

  —

  £105.01 and over

  1,000

  —

  —

  —

  —

  —

  —

  Source:

  Income Support Statistics Quarterly Enquiry November 1994.

  Notes:

  1. Figures are rounded to the nearest thousand. Due to rounding some totals may not tally.

  2. Sample size 5 per cent.

  3. "—" Denotes nil or negligible.

  4. Regions are Government Standard Statistical Regions.

  5. Regional figures quoted exclude cases with the Greater London Extension.

  Sir Andrew Bowden
  To ask the Secretary of State for Social Security how many women in nursing homes aged 60 years and over receiving preserved rights to income support in (a) terminal illness, (b) physical disability over pension age, (c) drug and alcohol dependence, (d) mental handicap, (e) mental illness and (f) any other category by (i) £00.1 to £13.10, (ii) £13.11 to £15, (iii) £15.01 to £25, (iv) £25.01 to £35, (v) £35.01 to £45, (vi) £45.01 to £55,

  Income support preserved rights cases with weekly accommodation charge above income support limits: women aged 60 and over in nursing homes

  A. By standard region and type of care

  Greaat Britain

  Wales

  Scotland

  England

  All nursing homes

  36,000

  2,000

  3,000

  30,000

  Type of care

  Mental illness

  1,000

  —

  —

  1,000

  Drug or alcohol dependence

  —

  —

  —

  —

  Mental handicap

  —

  —

  —

  1,000

  Terminal illness

  14,000

  1,000

  1,000

  11,000

  Physical disability above pension age

  3,000

  —

  —

  3,000

  Any other category

  18,000

  1,000

  2,000

  16,000

  A. By standard region and type of care

  England

  Greater London

  South-east

  North

  Yorkshire and Humberside

  East Midlands

  East Anglia

  South-west

  West Midlands

  North-west

  All nursing homes

  2,000

  5,000

  2,000

  5,000

  3,000

  1,000

  4,000

  3,000

  6,000

  Type of care

  Mental illness

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Drug or alcohol dependence

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Mental handicap

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Terminal illness

  —

  1,000

  1,000

  2,000

  1,000

  1,000

  2,000

  1,000

  3,000

  832
  (vii) £55.01 to £65, (viii) £65.01 to £75, (ix) £75.01 to £85, (x) £85.01 to £95, (xi) £95.01 to £105 and (xii) over £105.01 for (1) Greater London and (2) by English region, excluding Greater London, (3) England and (4) Great Britain. [7730]

  Mr. Evans
  The information is not available in the format requested. Such information as is available is set out in the table.
  833

  A. By standard region and type of care

  England

  Greater London

  South-east

  North

  Yorkshire and Humberside

  East Midlands

  East Anglia

  South-west

  West Midlands

  North-west

  Physical disability above pension age

  —

  1,000

  —

  —

  —

  —

  —

  —

  —

  Any other category

  1,000

  3,000

  1,000

  3,000

  2,000

  —

  2,000

  2,000

  2,000

  Source:

  Income Support Statistics Quarterly Enquiry November 1994.

  Notes:

  1. Figures are rounded to the nearest thousand. Due to rounding some totals may not tally.

  2. Sample size 5 per cent.

  3. "—" Denotes nil or negligible.

  4. Regions are Government Standard Statistical Regions.

  5. Regional figures quoted exclude cases with the Greater London Extension.

  B. By range of charge and type of care

  All nursing homes

  Mental illness

  Drug or alcohol dependence

  Mental handicap

  Terminal illness

  Physical disability above pension age

  Any other category

  Cases with charges:

  Above weekly I. S. Limit

  36,000

  1,000

  —

  —

  14,000

  3,000

  18,000

  of which above weekly is limit by:

  £0.01 to £13.10

  19,000

  1,000

  —

  —

  7,000

  2,000

  9,000

  £13.10 to £15.00

  2,000

  —

  —

  —

  1,000

  —

  1,000

  £15.01 to £25.00

  4,000

  —

  —

  —

  2,000

  —

  2,000

  £25.01 to £35.00

  4,000

  —

  —

  —

  2,000

  —

  2,000

  £35.01 to £45.00

  2,000

  —

  —

  —

  1,000

  —

  1,000

  £45.01 to £55.00

  1,000

  —

  —

  —

  1,000

  —

  1,000

  £55.01 to £65.00

  1,000

  —

  —

  —

  —

  —

  1,000

  £65.01 to £75.00

  1,000

  —

  —

  —

  —

  —

  —

  £75.01 to £85.00

  1,000

  —

  —

  —

  —

  —

  —

  £85.01 to £95.00

  —

  —

  —

  —

  —

  —

  —

  £95.01 to £105.00

  —

  —

  —

  —

  —

  —

  —

  £105.01 and over

  1,000

  —

  —

  —

  —

  —

  —

  Source:

  Income Support Statistics Quarterly Enquiry November 1994.

  Notes:

  1. Figures are rounded to the nearest thousand. Due to rounding some totals may not tally.

  2. Sample size 5 per cent.

  3. "—" Denotes nil or neglible.

  4. Regions are Government Standard Statistical Regions.

  5. Regional figures quoted exclude cases with the Greater London Extension.

  Ms Lynne
  To ask the Secretary of State for Social Security how many parents with care ceased to claim income support within four weeks of liable relatives action for each year since 1989. [12072]

  Mr. Andrew Mitchell
  The information is not available.

  Ms Lynne
  To ask the Secretary of State for Social Security how the benefit savings due to parents with care ceasing to claim income support were calculated prior to 1993–94. [12073]

  Mr. Evans
  By multiplying the number of income support cases where the reason for cessation was attributable to liable relative action by the amount of benefit in payment and an average anticipated duration for benefit claims.

  Mr. Gordon Prentice
  To ask the Secretary of State for Social Security how many claims for income support there were in the Burnley, Pendle and Rossendale district in each year since 1992. [10873]
  834
  Mr. Evans
  The administration of income support is a matter for Peter Mathison, the chief executive of the Benefits Agency. He will write to the hon. Member.

  Letter from Peter Mathison to Mr. Gordon Prentice, dated 30 January 1996:
  The Secretary of State for Social Security has asked me to reply to your recent Parliamentary Question asking how many claims for Income Support (IS) there were in the Burnley, Pendle and Rossendale District in each year since 1992.
  The number of IS claims for this District for the calendar years since 1992 are:

  1992: 23,698

  1993: 20,544

  1994: 21,084

  1995: 21,160

  These figures are provisional and may be subject to change.
  I hope you find this reply helpful.

  Mr. Chisholm
  To ask the Secretary of State for Social Security what was the total cost of paying income support for mortgage interest payments in Scotland in each of the
  835
  years since 1988–89; and how many households received payments in each of these years. [11142]

  Mr. Evans
  The administration of income support is a matter for Peter Mathison, the chief executive of the Benefits Agency. He will write to the hon. Member.

  Letter from Peter Mathison to Mr. Malcolm Chisholm, dated 30 January 1996:
  The Secretary of State for Social Security has asked me to reply to your recent Parliamentary Question asking what was the total cost of paying Income Support for mortgage interest payments in Scotland in each of the years since 1988–89; and how many households received payments in each of these years.
  Annex A details the information requested.
  I hope you find this reply helpful.

  Annex A: Income Support customers with mortgage interest in Scotland

  Number of cases with mortgage interest

  Total estimated annual expenditure £million

  1988–89

  15,000

  19

  1989–90

  14,000

  26

  1990–91

  18,000

  33

  1991–92

  19,000

  32

  1992–93

  22,000

  33

  1993–94

  23,000

  32

  1994–95

  25,000

  34

  Notes:

  1. Cases are rounded to the nearest thousand and expenditure to the nearest million.

  2. Estimated annual expenditure is derived by multiplying the number of cases with the average weekly amount then multiplying by 52.

  3. For 1993–94 and 1994–95 figures have been used from the 4 quarterly enquiries which show a better estimate for expenditure.

  Source:

  Income Support Statistics Annual Enquiries 1989–1992 and Quarterly Enquiries May 1993–February 1995.

  Divorce
  Mr. Denham
  To ask the Secretary of State for Social Security what calculation he has made of the changes in divorce rates in each 10-year period to 2020 and in 2037. [11635]

  Mr. Heald
  None.

  Marriage
  Mr. Denham
  To ask the Secretary of State for Social Security what calculation he has made of the changes in marriage rates in each 10-year period to 2020 and in 2037. [11634]

  Mr. Heald
  None

  Child Support Agency
  Ms Lynne
  To ask the Secretary of State for Social Security what the benefit savings attributable to the Child Support Agency since its establishment would be if they were calculated on the same basis as those forecast in the financial memorandum of the Child Support Bill; and if he will provide a breakdown of the figures. [12074]

  Mr. Andrew Mitchell
  Such estimates cannot be provided until the longer-term incentive effects of the work of the Child Support Agency are known.
  836
  Ms Lynne
  To ask the Secretary of State for Social Security what the benefit savings attributable to liable relatives action would have been in each year since 1989 if they had been calculated including the 51 multiplier in accordance with the procedures adopted by the Child Support Agency since 1993–94. [12071]

  Mr. Mitchell
  The information is in the list:

  1989–90: £270 million

  1990–91: £315 million

  1991–92: £400 million

  1992–93: £440 million

  These figures include savings resulting from action to collect spousal maintenance and payments made in respect of sponsored immigrants.

  Ms Lynne
  To ask the Secretary of State for Social Security which computer applications contain information relating to clients on the Child Support Agency computer system. [11806]

  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 30 January 1996:
  I am replying to your Parliamentary Question to the Secretary of State for Social Security about Child Support Agency computer applications.
  Information relating to Child Support Agency clients is held and maintained only in the database of the main Child Support Computer System.
  I hope this is helpful.

  Ms Lynne
  To ask the Secretary of State for Social Security how many requests he has received from clients of the Child Support Agency for copies of the records held on them by the agency computer system. [11802]

  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 30 January 1996:
  I am replying to your Parliamentary Question to the Secretary of State for Social Security about Child Support Agency records.
  From the inception of the Agency in April 1993 to 24 January 1996, a total of 3,634 requests have been received from clients of the Child Support Agency for copies of personal information held about them on the Child Support Computer System.
  I hope this is helpful.

  Company Pension Funds
  Ms Corston
  To ask the Secretary of State for Social Security if he will make a statement on the role of the Pensions Act 1995 in preventing employers appropriating or transferring the surpluses from company pension funds. [12606]

  Mr. Heald
  At present, trustees can approve payments from surplus to employers if they are permitted by scheme rules. The Pensions Act 1995 will no longer allow the trustees of occupational pension schemes to make a payment to the employer from a surplus unless new
  837
  statutory requirements are met. In future, the following conditions will have to be met, irrespective of the terms of the scheme rules:

  (a) the proposals to eliminate the surplus have been approved by the Inland Revenue;

  (b) the trustees are satisfied that it is in the interests of the members for the payment to be made;

  (c) the scheme must not be winding up;

  (d) all pensions must be increased annually in line with inflation up to 5 per cent. for both past and future service;

  (e) the employer has agreed that a payment should be made to him;

  (f) members must be notified in accordance with prescribed requirements of the intention to make a payment from surplus to the employer.

  The Act also provides that if a payment is made to an employer in breach of the statutory requirements, the Occupational Pensions Regulatory Authority may apply to the High Court—the Court of Session in Scotland—for an order to restore the funds to the scheme.

  We have announced our intention to bring these requirements into force from April 1997.

  Compensation Recovery Unit
  Dr. Godman
  To ask the Secretary of State for Social Security what was the amount of state benefits regained

  Average household equivalised incomes of women over the age of 25 who are widowed, single and in partnerships

  Equivalent monetary values in £s per week

  Before housing costs

  After housing costs

  Year

  Widows

  Singles

  Women in couples

  Widows

  Singles

  Women in couples

  1981

  —

  168

  207

  —

  152

  180

  1987

  —

  205

  251

  —

  186

  218

  1988–89

  —

  207

  273

  —

  189

  240

  1990–91

  —

  207

  293

  —

  189

  258

  1991–92

  194

  215

  294

  182

  195

  259

  1992–93

  194

  218

  296

  180

  196

  262

  1. The information in the table is derived from the Households Below Average Incomes' datasets.

  2. Information for widows is not available before 1991. Figures for single women includes women who are single and never married, divorced, separated and widows. In 1981, 1987 and 1988–89 information for women in couples covers married women only; women who were co-habiting are counted as single women. Information for couples for later years includes married women and women who are co-habiting.

  3. Estimates are of mean weekly household equivalised disposable income. For further information about equivalisation see appendix 4 of Households Below Average Income 1979–1992–93—a copy of which is in the Library. Figures are given to the nearest whole £ and are in March 1995 prices.

  4. All estimates are subject to sampling error.

  5. Figures for 1988–89, 1990–91, 1991–92 and 1992–93 are for two calendar years data combined.
  838
  by the compensation recovery unit in (a) Strathclyde and (b) Scotland in each of the past three years. [11541]

  Mr. Roger Evans
  The information could be obtained only at disproportionate cost.

  Dr. Godman
  To ask the Secretary of State for Social Security, pursuant to his answer of 22 January, Official Report, column 108, about the compensation recovery unit, if he will list the parties which were consulted in late 1995. [12484]

  Mr. Evans
  The information has been placed in the Library.

  Women's Incomes
  Mr. Corbyn
  To ask the Secretary of State for Social Security what estimate his Department has made of the average income of women over the age of 25 years who are (a) widowed, (h) single and (c) in a partnership for each year since 1980; and if he will make a statement. [12264]

  Mr. Andrew Mitchell
  Such information as is available is in the table. These figures show average household income after adjustment for household size and composition. These figures are used rather than individual income as the latter does not reflect all the income available to women in households; some income components can also not readily be attributed to individuals.

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

Lord Bowness
Sir Peter Spencer Bowness, Knight, CBE, having been created Baron Bowness, of Warlingham in the County of Surrey and of Croydon in the London Borough of Croydon, for life—Was, in his robes, introduced between the Lord Weatherill and the Lord Clark of Kempston.

European Football Championships: Policing
2.48 p.m.
Lord McNally Lord McNally asked Her Majesty's Government:
What steps they are taking to ensure adequate measures to prevent violence and disorder among rival groups of supporters at the European Football Championships, Europa '96, to be held in Great Britain this summer.
The Minister of State, Home Office (Baroness Blatch): My Lords, the Association of Chief Police Officers has developed extensive plans for the policing of Europa '96 in conjunction with the Football Association and government departments. There will be police intelligence centres adjacent to the eight grounds, with a co-ordinating centre in central London. The latest technology will be used to ensure that local police have up-to-date information about known and suspected hooligans. Police officers from the participating countries will be present to assist our police with visiting fans.
Lord McNally: My Lords, I thank the Minister for that encouraging Answer. Does she agree that, with an expected 250,000 visitors spending approximately £125 million in this country, this will be a marvellous opportunity to show Britain as a tourist centre and as a centre for staging major sporting festivals? If anything were to go wrong, it would be a disaster for our tourist industry and those prospects. For that reason, will the Minister help me by agreeing that there may be a case for a "buck-stops-here" Minister to co-ordinate some of the numerous bodies to which she referred in her Answer? Furthermore, is she satisfied that the policing of the Trooping the Colour and the England-Scotland game, both of which will take place in London on 15th June, will have adequate resources?
Baroness Blatch: My Lords, I am pleased to help the noble Lord by agreeing with his first statement that this is a great event. We want it to be a happy, enjoyable and successful event, and I believe that it will be. Much
1446
work has gone into the planning and there is a great deal of co-ordination. A European working group is meeting to discuss these matters, together with police and other people in this country. In addition, a Football Association group is meeting the government departments. There is a good deal of exchange of information between the countries, and as much intelligence as possible is being used to minimise the disruption from, I have to say—and it needs to be recorde—a few hooligans who have a disproportionate impact on the enjoyment of others at these games.
It is our view that the majority of people who will arrive in this country to support their own teams will he law abiding citizens. The Department of National Heritage is making available £400,000 to allow cultural activities to take place in the host areas where the games will be played. National Music Day will also coincide with the final of the championships. Therefore a good deal is going on and there is much co-ordination too.
Lord Macaulay of Bragar: My Lords, will the Minister confirm that the championships are not being held in Great Britain, but in England? Does the Minister recognise that the behaviour of Scottish football supporters throughout the world has been impeccable during the past five years? We hope that Scottish football supporters will maintain their great record in contrast to the behaviour of some people south of the Border who shall be nameless.
Baroness Blatch: My Lords, we have high expectations of all the players and all the fans. It is worth saying that it is not only English fans who cause trouble at football matches. Many countries have the same difficulty. What is encouraging is the way in which countries and police forces are now co-operating to do what they can to root out hooliganism so that the championships will be an enjoyable event for everyone.
Baroness Seear: My Lords, does the Minister agree that England is in Great Britain and that Great Britain includes the greater as well as the lesser?
Baroness Blatch: My Lords, I am happy to agree.
The Viscount of Falkland: My Lords, does the Minister agree that it is almost certain that large quantities of alcohol will be consumed at the championships? Are there any contingency plans to cope with that?
Baroness Blatch: My Lords, one thing that the Government have done which will be enormously helpful is to pass legislation on that matter. I refer to the controls on the sale and possession of alcohol under the Sporting Events (Control of Alcohol Etc.) Act 1985. We expect the police to use those powers and the courts to support them.
Lord Howell: My Lords, is the Minister aware that, for the purposes of football, England is regrettably not in Great Britain or the United Kingdom but is separately represented in FIFA? From this side of the House may I endorse everything that the Minister said about our confidence in the ability of the police and the authorities

1447
to deal with this matter? May I invite the Minister to congratulate the Football Association and to wish the England team well? Will she rejoice with me over the fact that the whole nation will be able to watch that event because it will be on terrestrial television?
Perhaps I may ask the Minister about police costs which are likely to be enormous. Can the Minister assure us that no undue costs will fall on the local authorities bearing in mind that the event will take place in only one or two areas? Finally, may I ask the Minister for an assurance that Part II of the Football Spectators Act, which we all supported, will be fully implemented, enabling the police to bring offenders before the courts to obtain banning orders to stop those offenders from attending any more matches? Since that Act was put on the statute book, no more than five or six offenders have been brought before the courts. Is it not a case of the Government saying—
Lord Hailsham of Saint Marylebone: My Lords, that is the third "Finally".
Lord Howell: My Lords, no, I believe that there has been only one. Is it not a case of the Government saying, "Don't look at what we've done, but at what we say", which is inadequate?
Baroness Blatch: My Lords, the role of Parliament and the role of politicians within Parliament is to pass legislation. The use of those powers is a matter for the police, and supporting the police is a matter for the courts. It is not a matter for politicians either in this place or in another place. Like the noble Lord, we expect those powers to be used. That is why they are on the statute book. We hope that they will be used to make sure that there is early intervention at any signs of disruption which might spoil the fun of all those who want to play or watch the games.
As to the costs, there is no specific provision. Policing outside football grounds is part of normal policing duties and as such the costs should be met from existing resources. As the noble Lord knows, the costs of policing inside the grounds is a matter for the Football Association. Special payments of grant are made to police authorities only when the Home Office and the Treasury are satisfied that the expenditure is exceptional, unforeseen and of a scale that is likely to threaten the efficiency of the force. I can report that the Football Trust has agreed to contribute to the capital cost of the police communication equipment that will be used during the competition.

EU Convergence: Unemployment
2.57 p.m.
Lord Bruce of Donington Lord Bruce of Donington asked Her Majesty's Government:
Whether they will propose, as a specific addition to the convergence criteria set out in the Treaty on European Union, a condition that the unemployment rate in each member state, defined as the percentage
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of economically active people who are unemployed on the International Labour Organisation (ILO) measure, shall not exceed 3 per cent.
The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish): My Lords, the Government have always taken the view that the present convergence criteria are necessary but not sufficient for successful economic and monetary union. Clearly, labour market flexibility would be important for economic and monetary union to work. A formal unemployment target is not acceptable because it wrongly implies that governments can create jobs.
Lord Bruce of Donington: My Lords, I invite the Government to accompany me to the heart of Europe. Is the Minister aware that in Europe as a whole unemployment now stands at 18 million people and is still rising and that there is a growing realisation among the member states that unemployment at a certain level has to be adopted as a convergence factor? I refer particularly to Italy, which holds the presidency, where proposals along the lines suggested in my Question are already being discussed.
Lord Mackay of Ardbrecknish: My Lords, I would happily take a trip to the heart of Europe with the noble Lord. If he forwards me an accompanying air ticket, perhaps we can leave at the weekend to study these matters. The noble Lord is right. If we study unemployment, we see that most of our European partners have much higher levels than we do. We have an unemployment rate of about 8 per cent. In Germany it is 8.5 per cent. and in Spain, as I have pointed out on a number of occasions, 22 per cent. It is pleasing that some European countries are beginning to see that the steps we have taken to ensure that we do not price our workers out of international markets and do not impose unbearable social costs on industry are correct. That is why we have an opt-out from the social chapter; it also explains why we shall not impose a statutory minimum wage.
Lord Boardman: My Lords, might not the better course for dealing with the problems to which the noble Lord, Lord Bruce, refers be to ensure that our European colleagues adopt the policies of this country? I have in mind, as my noble friend said, our policies towards the social chapter and the minimum wage.
Lord Mackay of Ardbrecknish: My Lords, my noble friend is absolutely right. Indeed, we have been saying for some time that greater labour market flexibility is vitally important if we in the United Kingdom—and, indeed, the whole of Europe—are to compete in the modern world. I believe that an increasing number of people on the Continent are beginning to realise that the social chapter and all the things that go with it are a European employment tax.
Lord Richard: My Lords, will the Minister ponder on what seems to have been happening with the Conservative government in Germany and the Conservative administration in France over the past week or 10 days? It seems that they see the way forward

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through a consensus of government, trade unions and employers. Does the Minister not consider that approach to be rather more sensible than the institutionalised confrontation that he advocates so much?
Lord Mackay of Ardbrecknish: My Lords, since our various reforms of trade union legislation, the institutional confrontations have not been present in this country. It is interesting that the reaction of trade unions in Germany to yesterday's package of proposals from the German Government was hardly enthusiastic. The Germans are beginning to realise that a reduction in social welfare contributions is vital if their economy is to improve and their unemployment rate to decrease. The hope is that the public spending share of GDP will he reduced from just over 50 per cent. to 46 per cent., a course of action which we have been pursuing for some years without the help of the Opposition whose desire for increased government spending seems to continue.
Lord Pearson of Rannoch: My Lords, when my noble friend says that the convergence criteria are necessary but not sufficient, will he go further and agree that they are unlikely to be met either? If that is so, will the Government use Article N of the treaty to prevent the other countries of Europe from signing up to the folly of monetary union?
Lord Mackay of Ardbrecknish: My Lords, such decisions are for those other countries to take. Of course, we have our opt-out provision which we negotiated. I must tell my noble friend that I am not very sure what the Opposition's view on the opt-out is. We have the negotiated opt-out and, as I have said continually from this Dispatch Box, we will decide such matters when the day of decision is right and we can take the decision with a full view of all the consequences. That means not just the convergence criteria, but also the impact that joining EMU might have on our economy and on employment. I believe that that is the right and responsible approach.
Lord Wallace of Saltaire: My Lords, does the Minister agree that the importance of getting the convergence criteria right implies that Her Majesty's Government need to play an active part in all such decisions and not be passive in defining the terms for monetary union? Does the Minister also agree that it would be unfortunate for our national interests if we were to give our partners the impression that we are always in the right and the others are in the wrong, as, sadly, Ministers occasionally do?
Lord Mackay of Ardbrecknish: My Lords, we believe that we should pursue British interests. If that means that we are alone, then so be it. The noble Lord's party can perhaps be characterised as one which believes that if we ever disagree with any of our European partners we must inevitably be in the wrong. On the noble Lord's substantive point, I can say that we are playing an active role in the work that is going on leading up to monetary union. However, the important point to note is that, because of the Prime Minister's
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opt-out, we shall be able to make a decision as to whether to join nearer the time when we see what the position is for the United Kingdom's interests.
Lord Dixon-Smith: My Lords, does my noble friend the Minister agree that the flight of manufacturing capacity from Germany and the troubles in France at the end of last year are scarcely examples of successful economies that we would wish to emulate too directly?
Lord Mackay of Ardbrecknish: My Lords, my noble friend is right to draw attention to the problems that exist in both France and Germany. I have drawn attention to the unemployment problem which is actually far greater in France than in Germany. However, it is growing in Germany. It is most interesting that the German Government decided yesterday to privatise Lufthansa and to bring forward proposals to deregulate the electricity and gas industries. That suggests that they are beginning to learn from us.
Lord Stoddart of Swindon: My Lords, will the Minister remain with me at the heart of Britain? It will be far cheaper if he does. Does he agree with the article in the Financial Times today by the right honourable Douglas Hurd, the former Foreign Secretary, who says that by pushing the issue of economic and monetary union too far and too fast the Government may in fact derail the project and perhaps the European Union at the same time?
Lord Mackay of Ardbrecknish: My Lords, the noble Lord makes a serious and proper point that everyone in Europe should consider. If Europe pushes ahead with the project without all the problems being resolved and without the proper conditions, I believe that there is a danger; indeed, a wrong EMU would be far worse than no EMU at all. However, other governments will have to address such problems from the point of view of their countries. Thanks to the Prime Minister's opt-out, we will be able to consider our position. I believe that you can he at the heart of Europe without necessarily having to follow slavishly everything that the rest want.

Scotland: Police Protection Measures
3.6 p.m.
Lord Campbell of Croy Lord Campbell of Croy asked Her Majesty's Government:
What proposals they have to improve the ability of police in Scotland to protect themselves from violence, in particular whether they propose to issue CS sprays or special clothing.
The Parliamentary Under-Secretary of State, Scottish Office (The Earl of Lindsay): My Lords, the Government fully support the development of protective equipment for the police in Scotland. The issue of such equipment is, however, the responsibility of chief constables.
Lord Campbell of Croy: My Lords, I am grateful to my noble friend the Minister for that reply. As trials

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with sprays are now to take place in England, can my noble friend say whether my right honourable friend the Secretary of State for Scotland has considered with the Scottish police forces any similar personal protection, presuming that violence of a similar kind must also be expected in Scotland? Further, as regards special clothing, can my noble friend say whether protection from knife attacks has been less necessary since the successful knife amnesty in Strathclyde that took place three years ago?
The Earl of Lindsay: My Lords, my noble friend has raised two important points. The operational trials of CS incapacitant spray that he has heard about will in fact be started in England and Wales in March. The outcome of those trials will guide my right honourable friend the Secretary of State as to whether CS spray should be deployed in Scotland. If it should be, then it will be for the individual chief constables to judge where that will be necessary.
The recent knife amnesty in Strathclyde, to which my noble friend referred—called Operation Blade—was an outstanding success; indeed, 4,500 knives were surrendered. Moreover, there is evidence to show that there are now fewer knives on the streets. In fact, the attempted murder rate with knives fell by one-half during the operation. However, it should be pointed out that police officers will always have to face a degree of risk when going about their duties. Therefore, we shall continue to develop protective clothing. We shall also continue to supply officers with expandable batons and other such measures of protection.
Lord Carmichael of Kelvingrove: My Lords, is the Minister aware that the Question tabled by the noble Lord, Lord Campbell of Croy, is most timely because this is becoming a very important issue not only in Scotland but in Great Britain as a whole? I believe that it is a wise decision on the part of Scottish chief constables to await the results of the English experiment.
However, people speak perhaps too loosely about the use of CS gas spray. I understand that it has a range of about 15 or 16 feet. Indeed, there are great dangers both to the police and, perhaps, to innocent passers-by—in particular to children and people with breathing problems. Moreover, I believe that exposure to the gas can be most serious for pregnant women. The Minister said that the use of protective clothing for the police was being studied. I understand that such clothing would cost somewhere in the region of £350 per officer and that that would amount to something like £9 million for the whole of Scotland. Can the Minister say whether that money would be available to local authorities to enable them to equip the police for the very difficult job that they have to do?
The Earl of Lindsay: My Lords, the noble Lord is quite right to say that the use of CS sprays should be treated, and undertaken, with care. That is why we have operational trials starting in March in England and Wales, and that is why we are not pre-empting the results of those trials. Decisions will be made after the trials have been analysed. As the noble Lord pointed out, protective vests cost around £350.
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The deployment of police resources and the deployment of the budget is a matter for the police authorities and the chief constables. We in the Scottish Office would not seek to dictate to them how they should deploy those resources. However, I can tell the noble Lord that police resources will increase by 7.7 per cent. in this coming financial year as compared with the current financial year. Since 1979 expenditure on the police has risen by 57.3 per cent. in real terms.
We are committed to law and order in Scotland and we are determined to see more police officers on the heat. We have a commitment over the next three years to put an extra 500 police officers on the beat in Scotland.
Lord Orr-Ewing: My Lords, can my noble friend give the previous occasion when we really considered using water sprays as a cheap and effective way of discouraging violence? That would be particularly effective in the current cold weather.
The Earl of Lindsay: My Lords, I cannot tell my noble friend exactly when that matter was previously considered. However, we are especially anxious that the police authorities and chief constables have as much discretion at their disposal as possible to respond to the need as they think best.
Lord Merlyn-Rees: My Lords, is the Minister aware that I agree with him that the use of CS sprays, body armour and other such materials is a serious matter? I seek knowledge on it all the time. Is the Minister saying that this is only an operational matter and that it is not something for the Secretary of State for Scotland?
The Earl of Lindsay: My Lords, it is up to the chief constables and the police authorities, who best understand the challenge with which they have to cope in their areas, to consider what resources to deploy and what equipment to supply to their police officers. Our job is to make sure that they have the necessary financial resources with which to meet that challenge. As I have said, since 1979 financial resources for the police have risen by 57.3 per cent. in real terms. We now have 15 per cent. more police officers on the streets. We have a commitment to increase that number yet further in coming years. Protective clothing poses special practical problems. To have a protective vest, which is both knife resistant and bullet resistant and light and flexible enough to wear for any length of time while on operational duty, demands a material which has not yet been properly developed

Shellfish Transportation
3.12 p.m.
Lord Palmer Lord Palmer asked Her Majesty's Government:
Whether they intend to revoke the Welfare of Animals during Transport Order 1994 (S.I. 1994 No. 3249) in respect of shellfish.
Lord Lucas: No, my Lords. We plan in the course of 1996 to remake the Welfare of Animals during Transport Order 1994. We expect that the new order

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will continue the present requirements that shellfish should be transported appropriately and with basic documentation.
Lord Palmer: My Lords, I thank the noble Lord for that Answer. Could he perhaps confirm whether, unlike other animals, shellfish do not have to travel with a passport?
Lord Lucas: My Lords, the noble Lord is perfectly correct.
Lord Campbell of Croy: My Lords, as it is advisable that most shellfish be alive at the point of retail sale, as Molly Malone clearly knew with her cockles and mussels, does my noble friend agree that it is in the interests of fishermen and fish merchants to handle and treat shellfish with care but that those who initiated this interpretation would have difficulty in making a commercial business of running a store for selling whelks?
Lord Lucas: My Lords, on my noble friend's first question, the answer is indeed yes. That is why we have experienced no trouble at all with these regulations since they were first brought in, in 1977. I think in this case, as in many others, the aspersions which my noble friend casts upon the European Union and the Commission are entirely inappropriate. This is a sensible regulation sensibly interpreted.
Lord Carter: My Lords, while it is extremely reassuring that the Government intend that oysters, mussels and other molluscs can travel around the European Union in the style to which they are accustomed, will the Minister assure the House that the Government will use their best endeavours to ensure that this order is interpreted with the maximum of common sense, and that each species, be it large or small, is treated in a way which is appropriate to that species? Although my next question is a little wide of the Question on the Order Paper, will the Minister comment on the problems affecting the transport of day-old chicks, for example?
Lord Lucas: My Lords, as regards the first part of the noble Lord's question, I entirely agree that that is exactly what the directive says. But the connection between oysters and day-old chicks escapes me!
Lord Strabolgi: My Lords, is the noble Lord aware that the British oyster—our oysters—have been considered the best since the time of the Romans? Is he further aware that during the past century they were plentiful and reasonably priced, unlike now, although in France they are still plentiful and much more reasonably priced than ours, and many millions are eaten every year and they are available in every brasserie? What, therefore, are the Government doing to encourage our own oyster industry to expand to what it was 100 years ago?
Lord Lucas: My Lords, I think this is entirely a matter for commercial oyster growers. As the noble Lord says, British oysters have an excellent reputation
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and they are well appreciated on the Continent and in this country. We in this country eat many fewer oysters than we used to. That may be a matter of national taste; I do not believe it is the fault of the fishermen or the Government.
Lord Walpole: My Lords, is the Minister also aware that under the same order a goat is a sheep—a concept that I feel the right reverend Prelate may have a problem in accepting?
Lord Lucas: My Lords, I suppose the question also arises under the order of whether shellfish have souls? The right reverend Prelate may have views on that, too.
The Lord Bishop of Chelmsford: My Lords, does the Minister accept that as far as the Church is concerned, sheep are sheep and goats are goats, and that any regulations for the transportation of shellfish will have no effect whatsoever upon the teaching of the eternal verities?
Lord Lucas: My Lords, it is a long time since we heard the Church of England in such firm voice.
The Countess of Mar: My Lords, is the noble Lord aware that this new order is an improvement in that just after the war goats were classified as poultry?
Lord Lucas: My Lords, the noble Countess always knows more than I do.

Business of the House: Debates this Day
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 Viscount of Oxfuird set down for today shall be limited to 3½ hours and that in the name of the Viscount St. Davids to 2½ hours.—(Viscount Cranborne.)
On Question, Motion agreed to.

UK Inward Investment
3.18 p.m.
The Viscount of Oxfuird The Viscount of Oxfuird rose to call attention to the level of inward investment into the United Kingdom in recent years; and to move for Papers.
The noble Viscount said: My Lords, it is a real pleasure for me this afternoon to propose this Motion, particularly when I note the array of talent from all sides of the House speaking today. I was especially pleased that the noble Lord, Lord Borrie, has chosen this occasion on which to make his maiden speech. All noble Lords will have benefited either directly or indirectly from his work over so many years at the Office of Fair Trading. I am sure that we are all looking forward eagerly to the impact that his special knowledge in the commercial field of law will bring to our debate this afternoon.
Judging from the contributions made from all sides of your Lordships' House when this matter was previously debated on 10th July last year, the need for inward investment into our country is widely accepted. In the 19th century the flow of investment capital from this country was, of course, predominantly outward rather than inward. Times have moved on and now we live in what our American cousins call a "global village". Outward investment from this country is quite rightly matched by inward investment into the country. In the 19th century we were investing outwards in terms of both the moneys and the skills that we could provide, but we were not always thanked for it. I wish to quote from Kipling who said,
"Take up the White Man's burden— And reap his old reward: The blame of those ye better, The hate of those ye guard."
Our debate this afternoon is about inward, not outward, investment. However, when I look back at some of the points that were made back in the 'seventies before this Government began to place emphasis on the importance of inward investment I shudder to note that the vital importance of this issue was often misunderstood and that investment from overseas was not always welcome. Indeed, some of the far-sighted industrialists from the United States, Japan and Korea who decided to invest their money here were reviled, rather in the same way as pioneering European colonists of the past. That point is worth emphasising.
A number of surveys have indicated that an important factor in encouraging Japanese companies to come to the United Kingdom rather than to locate elsewhere in Europe has been the warmth of the welcome they have received both at official and social levels in the United Kingdom. Our welcoming attitude seems to have worked, because I note that every one of Japan's top 10 consumer electronics firms has chosen the United Kingdom as its manufacturing base in Europe.
The reality is that inward investment into the United Kingdom has helped to develop and modernise our industrial base. It has created new jobs, introduced innovative new products and processes, filled gaps in our established domestic production, increased output overall and brought in valuable management and technological expertise.
If we accept the thesis that inward investment is a good thing and should be encouraged, let us begin to examine the reasons why we in the United Kingdom have, in recent years, seemed to be rather good at attracting it. The United Kingdom is the number one location for Japanese, United States and Korean investment in the European Union. We consistently succeed in attracting one-third of all inward investment into the European Union from outside.
There are a variety of reasons. One factor is, of course, the English language—a point that was well made by the noble Lord, Lord Haskel, in your Lordships' debate on 10th July last year. I understand that my noble friend Lord Geddes will have something to say on that subject this afternoon.
I contend that that is certainly not the only reason. An overriding reason is that over the past decade the United Kingdom has undergone a remarkable sea change. No longer do we suffer from overtaxation, overregulation, overmanning and uncomprehending and unco-operative trade unions. Overseas investors make commercial decisions to locate their factories here because it makes economic sense for them to do so. The culture of deregulation and competitiveness that we are progressively building in this country is not unnoticed abroad.
I have spent much of my working life promoting the export of British goods overseas—and what a soul-destroying job that was in the 1970s when the United Kingdom was seen to be the "sick man of Europe". Our goods were perceived as overpriced and of indifferent quality. Delivery promises were broken because of strikes, restrictive practices or plain poor management. How different is the picture for our exporters today, many of which are the very overseas firms which have chosen to invest here.
Overseas firms now account for about 40 per cent. of all the United Kingdom's manufactured exports, worth in the region of £45 billion in 1994. In 1995, 35,000 overseas companies in this country won a Queen's Award for Export Achievement. Success breeds on success. It helps to reinforce this country's position as the enterprise centre of Europe.
Let us look at what is being said about us abroad. On 15th October last year the New York Times ran a special feature under the rather journalistic headline:
"Smitten by Britain, Business rushes in".
It reads:
"For years, much of Europe derided Britain for creating a low-wage, low-security economy—one far closer to the American model of flexible work forces and intense pressure to drive down costs than to the European tradition of high pay, lavish benefits, strong unions, restrictive work rules, generous social welfare systems and high taxes. Now, however, policy makers in other countries are looking more closely at the British experiment as they grapple with high unemployment and eroding international competitiveness".
The disastrous consequences of signing up to the Maastricht social chapter, now commonly referred to all over the world as the "European employment tax", are beginning to be seen as a cursed millstone dragging down the performance of our European partners and striking deep into the heart and very lifeblood of the competitiveness of Europe.
It is noteworthy that since 1980 the United Kingdom's fixed investment has grown significantly faster than the European Union average; a statistic which is in stark contrast with those of the 1960s and 1970s when our growth rate was much lower than that of our European partners.
Perhaps I may also say a word about the exchange rate. The competitiveness of British firms has, of course, been enhanced by the fall in the value of sterling when we left the exchange rate mechanism. It is important not to forget that that benefit is likely to be relatively short term. In the medium to long term we would expect exchange rate levels to reflect the health of the United

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Kingdom economy, which is stronger today than it has been for many years and has become the envy of most of our partners in Europe.
In the longer term we must look to other factors to enhance our position. Let us look, then, at what additional measures we can take to further improve the position. Speaking on this subject in your Lordships' House on 10th July last year the noble Viscount, Lord Waverley, made a plea for better integration of the various agencies promoting inward investment into the United Kingdom. English Partnerships, the economic regeneration agency for England, which was established last year, has succeeded in creating valuable links between regional and local authorities and the Department of Trade and Industry's Invest in Britain Bureau.
However, we should not overemphasise the importance of those agencies. They will achieve nothing without the availability of attractive locations and potential employees with the right skills and competitive wage rates. Siemens, the German electronics group, which announced a £1,100 million investment last year in Newcastle upon Tyne, has been quite open about the factors which influenced its investment decision. Concerning the national and regional agencies, Siemens laid great stress upon their speed of response and their ability to offer a one-stop service as soon as the company began to show a serious interest in investing here.
There may be a lesson in that for the current political debate about regional government in England. Those in favour take it for granted that a new tier of government will improve the capacity of England's regions to attract foreign investment. In reality, England's past weaknesses in this sphere appear to have been primarily due to poor national promotion and inadequate co-ordination between regional and national agencies. It is far from clear that a new tier of regional politicians, all vying to outdo their neighbours, will improve upon the status quo.
The agencies in Scotland, Wales and Northern Ireland also deserve some mention since they have each proved successful in promoting the potential of the areas they represent. We shall be considering the economy of Wales in some depth later today, so perhaps I may be permitted to dwell for a few moments on my own homeland of Scotland.
Inward investment is a great Scottish success story. The year 1994 to 1995 was a record year for inward investment in Scotland, with 97 projects attracted, involving total planned investment of £1.1 billion and the creation or safeguarding of 12,300 jobs. Late last year Scotland secured the largest inward investment project ever attracted to the United Kingdom when Chunghwa Picture Tubes, of Taiwan, announced that it would create some 3,300 new jobs in Lanarkshire, an unemployment blackspot, by setting up a factory to manufacture cathode ray tubes for televisions and computer terminals.
It is interesting to note the facts about Scotland. Scotland now produces 12 per cent. of Europe's semiconductors, over 50 per cent. of Europe's
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automated banking machines, over 35 per cent. of Europe's personal computers and nearly 60 per cent. of Europe's workstations. Scotland is such an attractive location for inward investment because it has one of Europe's most cost-competitive operating environments, a low rate of corporation tax, excellent communications, and an education system geared to the needs of modern industry. How sad it would be if those achievements were threatened by the proposals that have been made by the Labour and Liberal Democrat Parties to create a tax raising Scottish Parliament. The so-called "tartan tax" would destroy much of what has been achieved and would create a less favourable environment for inward investment into Scotland than any other part of the United Kingdom.
I should like to turn now to the importance that the financial skills of the City of London play in attracting investment into the United Kingdom. I am particularly grateful to my noble friend Lord Sheppard of Didgemere for briefing me on the activities of the London First Centre and the role that it plays in helping to attract foreign companies to establish their European headquarters here. I note that my noble friend Lord Cuckney will speak later in the debate; and I know that we shall hear more from him on the subject.
Of equal importance to professionalism of our City institutions in attracting inward investment is the contribution made by the science community in the United Kingdom.
I refer now to the report of your Lordships' Select Committee on Science and Technology under the able chairmanship of the noble Lord, Lord Walton of Detchant. It was published in late 1994. One of the things that the committee studied was the reason why international companies choose to invest in UK science in a whole range of sectors. It found that the English language, which has now established itself as the international language of science, was a factor, but that of equal importance was the sheer excellence of United Kingdom science coupled with its well-established capacity for innovation. I quote from two Japanese companies. Sharp states:
"The United Kingdom enjoys a high reputation for the standard of basic research and research training in higher education".
Toshiba states:
"The most attractive feature of UK science which lends itself to collaborative research with multinational corporations is the strength of the basic, curiosity-orientated research and its associated infrastructure".
Time moves on. However, the message with which I wish to conclude is that the success of the Government in attracting inward investment into this country is real and tangible and has been of benefit to our whole community. Let us therefore build upon the successes of the past by continuing with much more of the same in the future. I beg to move for Papers.
3.34 p.m.
Lord Borrie: My Lords, I am most appreciative to the noble Viscount, Lord Oxfuird, for introducing the Motion. Not only is it one that has attracted so many

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names to speak in the debate, but I felt that it gave me an opportunity to make some comments by way of a maiden speech.
I must, first, declare an interest in that I am a non-executive director of a French owned company and of a largely American owned company, both of them investing in the United Kingdom.
I do not think that it will be too controversial in a maiden speech to say that there is much good in inward investment in terms of job creation, of added competitiveness for our country and sometimes of enhancing regeneration in some of our communities. I hope, too, that it will not be regarded as too controversial to say that sometimes we in the United Kingdom should be watchful and wary of inward investment—wary because it may be transient and footloose; wary because inward investment may mean that decision-making on important matters is taken outside this country; and wary also because it may be that inward investment distracts us from the important need to encourage and promote homegrown or indigenous investment.
During the many years that I was at the Office of Fair Trading, to which the noble Viscount kindly referred, I was less involved with inward investment by way of greenfield sites than by way of acquisition. It was my task to advise successive Secretaries of State for Trade as to whether such acquisitions should be referred for fuller investigation by the Monopolies and Mergers Commission. I can recall a number of instances of acquisitions from outside this country—for example, acquisitions or proposed acquisitions of the Royal Bank of Scotland and the Nestlé Company—when I was concerned to examine and advise on whether they would lead to something which would be adverse to the British economy because, among other things, it would lead to decision-making departing from these shores.
I recall the acquisition by Guinness of Distillers in Scotland—not, it is true, an acquisition from abroad, although many Scots seemed so to regard it. But the Office of Fair Trading was concerned to advise on whether that would be adverse to the Scottish economy because important headquarters functions and so on would be taken out of that important part of the United Kingdom. Your Lordships may recall that in order to counter that concern a distinguished Scottish banker was appointed as chairman. There were photographs of the chief executive's wife scurrying around Edinburgh allegedly house- hunting.
It is quite appropriate that the relevant authorities in the United Kingdom should consider whether, as regards acquisitions from outside Scotland or other regions, important functions are being taken away. If that is so, it seems more important still that one should be concerned if important centres of power and decision-making are removed altogether from the United Kingdom, especially, for example, if those industries are of strategic importance or the predator comes from another country whose laws may forbid takeovers in the opposite direction.
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Subsequent to my leaving the Office of Fair Trading in 1992, the late John Smith appointed me to be chairman of the Commission on Social Justice, where I acquired quite a lot of positive feeling towards inward investment. Among other places, we visited Nissan United Kingdom in Sunderland. The commissioners and I were much impressed by working practices there and by the way in which workers at the company were involved in making decisions. We were impressed by the involvement with the local community, for example, through training and education at the local university of Sunderland and with the high proportion of UK-made components which were being used.
Of course, as the noble Viscount said, it is important to recognise that such investment from abroad has had great benefits to industry at large because the management techniques, the practices and the other ideas which are brought spill over, through conferences and discussions, into industry. I am well aware—but, fortunately, so are the inward investors—that, as a newcomer in an area of historically and traditionally strong industrial cultures, there has to be a responsiveness, a careful treading on the waters, in order to ensure that sensitivities are not damaged. However, most of our newcomers who involve themselves in inward investment have taken a great deal of care in such matters and have built bridges into the traditions. They have been careful to ensure good relationships with the local community.
What sours relations, and what many people in the country are worried about, is when the inward investor behaves like a predatory tourist: here one day, gone the next, leaving behind a trail of broken hearts and unfulfilled promises. The House of Commons all-party Select Committee on Trade and Industry mentioned last year in its report that not all inward investors behave in the desirable way that I have described. They do not all use a high proportion of UK components; they are not all as sensitive as we would like them to be. They do not all bring to Britain the higher value activities like research and development.
I am a member of my party's Regional Policy Commission. When we have gone round the country taking evidence in the Midlands, Lancashire and elsewhere, we have been told many times that there must be a stronger insurance that there is a balance between indigenous investment and inward investment. The Select Committee on Trade and Industry was surely right when it said in its report published in March last year:
"both indigenous development and foreign inward investment have vital roles in regional economic development".
I hope that your Lordships will regard that as at least one useful message which can go out from this debate.
3.43 p.m.
Lord Laing of Dunphail: My Lords, on behalf of the whole House may I congratulate the noble Lord, Lord Borrie, on his maiden speech. The noble Lord has had a varied and distinguished career in law and commerce, and he and I met on many occasions during his period as a successful director of the Office of Fair

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Trading. I know that his wide knowledge and inquiring mind will, like his maiden speech, be much admired in your Lordships' House.
I congratulate the noble Viscount on his introduction to this important debate and thank him for giving us an opportunity to discuss the subject. As a Scot and chairman of a Scottish company—United Biscuits—for about 20 years, I shall largely confine my remarks to Scotland. Those responsible for arranging the remarkable result of inward investment to Scotland are greatly to be congratulated. Nothing that I say should detract from those congratulations. Foreign firms have located in Scotland because of the competitiveness of its workforce, some tax advantages and its excellent communications infrastructure. If, however, the so-called tartan tax is imposed, it will be a deterrent to foreign firms locating there and some Scottish companies would relocate to England.
United Biscuits employs 2,000 people in Scotland. When I was chairman, I made clear to them that, with our factories in England and throughout northern Europe, a factory in Scotland was not essential and if devolution in whatever form led to extra taxes being imposed on our employees or the company we would employ many fewer people there within a relatively short time. Indeed, our major factory in Glasgow would probably be closed.
There are great dangers to Europe if it spends too much time and effort looking inwards. The emerging countries of the Pacific Rim are those which pose the greatest threat to jobs and prosperity in Scotland or any other country in Europe for that matter. Let us not take any action that makes us less competitive. That is exactly what a tartan tax and some aspects of the social chapter would achieve.
I applaud inward investment. It is a sad fact, however, that British companies are not investing sufficiently in the United Kingdom. British companies have a vested interest in keeping Britain great. Looking to the next century, there are real dangers in relying on foreign firms investing here, as the noble Lord, Lord Borrie, said, when we should be making that investment ourselves. Too much money which should be invested in manufacturing industry is paid out in dividends and to accountants and lawyers in takeovers. I have made that point too often in your Lordships' House to labour it. There are other ways of changing inadequate managements, which are just as effective and achievable at much less cost, as has been demonstrated both here and in the United States.
Some 40 per cent. of our manufacturing industry is already controlled from outside this country by people who must surely have less interest in the UK than we have. While inward investment has undoubtedly been a boon, if we look about 25 years ahead and assume—I repeat assume—that by then we have a common currency with no control over interest rates or the exchange rate and recognise that we are on the periphery of Europe, with the major centres of population well south of Birmingham, we have to acknowledge the danger that foreign owners may well decide to move production away from, say, Scotland and nearer those
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centres of population. In a society which seems to look increasingly to the short term, I hope that that thought is sufficiently relevant to be fed into the equation.
With inflation at its lowest level for 30 years and clearly under control, with the unions operating within the law, with a workforce who have seen the folly of inflationary wage claims and who, when properly trained and led, are as good as, or better than, any in the world, the time has come for us to have the same faith in Britain as our overseas competitors seem to have and greatly to increase our investment in manufacturing industry in our own country.
On a minor point, it would be a considerable help if aid to small companies in Scotland were not restricted to relatively small areas. Inward investment is favoured by special tax arrangements and grants of one kind or another denied to some small Scottish companies. But it is largely to small companies that we must look for increasing employment. When my son's company, Shortbread House, whose business is located in Edinburgh, applied for a grant for a new factory adjacent to the existing building, so doubling the workforce, the only question asked was, "What is your postcode?". I find that rather a narrow view. I hope your Lordships do too.
3.50 p.m.
Lord Wallace of Saltaire: My Lords, I add my congratulations to the noble Lord, Lord Borrie, on his maiden speech. This is only my second speech in the House. I remember with a degree of nervousness the maiden speech I made not so long ago. The noble Lord made a very useful and expert contribution.
I welcome the debate. As the noble Viscount, Lord Oxfuird, remarked, we are in a global economy in which there is increasingly no such thing as a British independent economy. Investment flows in and out; global companies operate. However, there is a question of balance. I wish to add my own note of caution.
There is a question of sovereignty. I have been struck during my short period in the House by the passion which issues of sovereignty arouse when they are directed towards Brussels. I am struck also by what seems to be the complacency with which sectors of British industry become immensely over-dependent on foreign-owned companies. In that way, sovereignty slips away. We may talk with pride about the electronics sector in Scotland, almost all of which is under foreign ownership. I am not sure that that is entirely healthy. Those who talk about the problems of German control of British money may wish to reflect on the number of German companies that now own substantial parts of British industry and indeed of the City. I declare an interest. I spent five years happily engaged in a fellowship at the University of Oxford funded by Deutschebank. I came to know Deutschebank very well and to admire it.
There is, I repeat, a question of balance. It is not enough for the Government to proclaim that inward investment is a substitute for civilian industry policy. We need to spend more time promoting British industry and, as the noble Lord, Lord Laing, pointed out,

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encouraging British firms to invest in Britain. One very sad statistic is not often quoted. British companies invest less in Britain than do their counterparts in other OECD countries. That should give cause for thought.
I am puzzled by those who think that devolution to Scotland, and perhaps in time also to the north of England, will put companies off. I spent time in Germany and in Spain. I note the very successful partnership between the Baden Württemberg government, universities and high technology industry in promoting the economy of that region. I note the Catalan government following a similar path. The idea that German companies such as BMW, with its close relationship with the Bavarian government, will be put off from investing in parts of Britain because we also have regional government seems a little odd. Why an independent entity in Scotland, rather than simply a bureau for investing in Scotland, should worry companies already familiar with federal systems both in the United States and in Germany is beyond my understanding.
I wish the Minister who replies to reassure us that the Government, in pushing as hard as they do for inward investment, are not promoting foreign companies sometimes almost at the expense of British companies. Working, as I now do, at the London School of Economics, I am aware of the very odd occasion when a senior Minister intervened to ensure that County Hall, just across the river, was successfully sold to a Japanese company rather than allow the London School of Economics to make a bid. That was a very odd preference for foreign ownership as against a British institution which, I remind the House, won the Queen's Award for exports for the number of foreign students attracted each year from outside the European Union. We are thus an invisible exporter on a very large scale.
I note that Battersea power station is also now in foreign ownership. Nothing much has happened to it since it was bought. I look forward to seeing what happens to the palace at Greenwich. Several foreign institutions are interested in buying it. That also gives me cause for thought, as does the Invest in Britain Bureau pronouncement that this country is so competitive because our labour costs are now cheaper than those of Ireland. Is it an immense source of pride for Britain that we have managed to place ourselves below Spain and Ireland as a low-cost competitor in the European market? Professor George Bain, principal of the London Business School, has written on precisely this point; namely, failure to invest in our own country and willingness to stress that we compete on low labour costs, a good strike record and low taxes. As he said, that is not enough for the long-term prosperity of this country.
My title comes from a small village in Yorkshire, Saltaire. Like the rest of Bradford, when the great surge in the value of the pound came in 1980–8, many branches of foreign-owned companies in Bradford closed. Salt's Mill, once the largest mill in West Yorkshire, finally closed in 1983 when its American owners decided that it was no longer a profitable branch. Companies owned by people in Yorkshire stuck it out.
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I am very happy to say that Salt's Mill now contains Pace Electronics, a small bunch of people I recall meeting in 1983–84. It is now well on its way to becoming one of the largest local employers. Our capacity for survival at a time of rising unemployment depended disproportionately on British-owned companies sticking out those two or three years. I worry about Britain becoming too much a branch economy for Germany, Japan, Korea, Taiwan, Sweden, the United States and others.
As we look ahead and appreciate that low wage costs are a passing benefit and as the Czech Republic, Poland and Hungary open up as effective competitors to the United Kingdom, with their well-trained workforces, we are going to have to do more. The promotion of inward investment is not enough in itself. I should like to hear from the Minister what we are doing to encourage British industry to raise the level of investment in Britain. How far are we sure that inward investment and its encouragement will also be marked by encouragement for British companies? It is clear that the encouragement of inward investment in this highly competitive global market is necessary and desirable. But it is not sufficient in itself.
3.58 p.m.
Lord Haskel: My Lords, this is indeed an important topic, crucial to the economy of the United Kingdom. I am most grateful to the noble Viscount for giving us the opportunity to debate inward investment, so that we can understand it better.
As we have heard, some inward investors are world-class companies, so I welcome their inward investment for the jobs it creates, for the new technology it brings to industry in Britain, for the advanced management and production methods that we learn from such companies, and particularly for the high standards that they set for their local sub-contractors.
However, other inward investors make acquisitions, and we have been told of the problems that can arise from them by my noble friend Lord Borrie. I welcome my noble friend's experience and his remarks today.
I would also welcome any news that the Minister in replying to this debate can give us about encouraging inward investment because, sadly, it seems to be in decline. The Central Statistical Office provides figures only to 1994, but they show that the net annual overseas investment in the UK rose in the 1980s from £3 billion to a peak of £18.5 billion in 1989, but by 1994 this had declined to £6.5 billion.
I say "sadly" because, as the noble Lords, Lord Laing and Lord Wallace, told us, we need all the investment we can get. According to the OECD, we invest less per head than Spain, Portugal and Iceland. We invest £1,600 per person in the UK. In France it is £2,250, in Germany £2,600 and in Japan £3,900. Unless we invest equal amounts per head of the population as our competitors, we have little chance of becoming as competitive as them and becoming the enterprise centre of Europe. It is the unit labour costs that matter, not the hourly labour cost, and investment is crucial in bringing that unit cost down.

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The noble Viscount, Lord Oxfuird, told us about the studies made in relation to encouraging inward investment into Britain. I assume that he was referring to a survey commissioned last year by the Invest in Britain Bureau of 200 manufacturing assembly and research companies which had already invested in the United Kingdom. When we last debated this matter I drew the Minister's attention to two conclusions to be drawn from that survey. The first was the importance of teamwork in attracting inward investment. The noble Viscount spoke of that when he gave us the example of Siemens. The team which attracts inward investment consists of the Invest in Britain Bureau, the development agencies, the local authorities and the local private companies on which the inward investment will depend.
The research showed how crucial was the role of the local authorities and the local development agencies both in attracting the inward investor to their areas and in providing grants and facilities. Many of them are Labour authorities, particularly in Scotland; and the research showed that the Government's attitude towards Labour-controlled local authorities had cast doubts in the minds of some inward investors.
I urge the Minister to encourage his colleagues to be generous in their praise of local authorities in attracting inward investment. In that way inward investors will not be discouraged by the thought of perhaps more Labour-controlled local authorities after the May elections and even the possibility of a Labour Government after a general election. The Government rightly welcome the good sense of overseas companies investing in Britain. But they try too hard to make political capital out of it for the Government alone.
I remind noble Lords that in the survey of 200 firms, 126 mentioned the need to be in the European Union as part of their world strategy, 32 mentioned the English language and only 12 mentioned labour costs. The conclusion to be drawn from that is that the Government's employment policies are irrelevant. They are not as important as the noble Viscount said. What is relevant are the management skills and practices of the inward investors and their long-term intentions. What is crucial is that the Government sort out their policy towards the European Union. I have no doubt that the division in the Government in relation to their attitude to Europe is one reason why inward investment is not even greater.
My final point concerns the need to disaggregate the inward investment figures so that we can understand them better. The noble Lord, Lord Wallace, referred to the problems of investment for the purchasing of assets. There is a difference between inward investment which creates a modern new car factory on a greenfield site and inward investment which buys up the shares in a factory already in existence, which is then closed down. The Minister will remember that that happened when Du Pont bought ICI's fibre business, as well as with the woollen companies in Yorkshire about which the noble Lord, Lord Wallace, told us. There must be a difference between inward investment which brings a new factory with new technology and high standards and inward investment which buys an asset like County Hall.
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I urged the Minister to disaggregate those figures when he first stood at the Dispatch Box in his present job last July. My enthusiasm was reinforced recently by an article in the current Harvard Business Review by Paul Krugman entitled "A Country is not a Company". I do not know whether the Minister had an opportunity of reading that article before switching on Coronation Street, but its main theme was that it does not follow that someone who has made a personal fortune and successfully run a business will also know how to make a nation more prosperous.
Mr. Krugman explained that point by the fact that business people and economists look at the same set of circumstances differently. One example he gave was inward investment. He said that US business people will welcome as an inward investor the overseas company that buys the Rockefeller Center. However, an economist working for the Government should look upon that purchase as a way of financing the US trade deficit with Japan. The purchase of the Rockefeller Center is a way of paying for the consumption of Japanese cameras and cars imported into the United States.
As businessmen, many noble Lords are absolutely right to welcome inward investment. I welcome it too, but perhaps not as blindly as the noble Viscount. I have tried to learn from Mr. Krugman's article and to take a more balanced view. That is not running down Britain; it is understanding inward investment better and being realistic.
4.7 p.m.
Lord Wade of Chorlton: My Lords, I too thank my noble friend and congratulate him on introducing this subject. It gives us an opportunity, on the one hand, to congratulate the Government on the tremendous amount of work that they have done—the travels that they have undertaken and the teams that they have led around the world—to encourage people to come and invest in Britain. It also gives me an opportunity to tell your Lordships a little about the North West and to emphasise a point which many noble Lords will have heard me mention before—that the most important thing that this country, or any business, can do is to ensure that investment increases.
As many noble Lords have said, it is not only important to bring in investment from elsewhere, but also to ensure that we use everything we have got to encourage investment at home. It is only through investment that we can stimulate jobs and acquire sufficient wealth to provide those things that we want to provide.
I must declare an interest. I am a director of INWARD Ltd., which is our North West inward investment organisation charged with the responsibility from government by the IBB to draw in and attract as much investment as possible. We have an income of approximately £2 million a year of which £1.6 million comes from the IBB and the rest is raised locally from major companies in the North West and local authorities.

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I wish to tell your Lordships a little about our successes and our constraints, because possibly the constraints apply to inward investment throughout the UK in general. Our successes have been considerable over the 10 years of our life. We have brought in approximately £0.5 billion of up-front investment which, from the follow-on investment that that generated from successful companies, has now run into around £2 billion and provided initial employment for 40,000 people, which has increased substantially over the years. Most of the companies from the time of that initial investment have grown considerably.
As a result of inward investment we have stimulated an awful lot of investment and technology—which is the keynote of that activity—throughout the North West. We have gained a lot of extra jobs and developed more local businesses. Out of major investments from abroad have come many supplying companies in the region who have been encouraged to invest also, which in turn has stimulated a general level of activity in the area. I hope that that will continue.
Things have changed slightly in recent years as a result of government policy. We are not now in competition with other regions in the way that we used to be because the IBB makes the decisions on where major inward investments will go. Whereas at one time we in the North West felt that we could compete positively with other regions of England—I refer to England at this stage—by offering better sites and opportunities and going out of our way to market the region, that is now less easy to do because of the way the IBB takes all of the initiatives. However, we are still very competitive with Scotland, Wales and Ireland, which has taken very positive views on inward investment.
One of the constraints I see in the system is that there is no regular basis on which financial support is offered to incoming companies. A major investment took place at the end of 1994 into the Chester region. It was a bank from Newark in America. It was offered different amounts of money from Ireland, from Scotland, from England and from Wales. By looking at that with the Treasury we could identify that the British taxpayer was competing against himself in the different regions to which the company might have been attracted to go because the Government were prepared to do more in one region than in another. We were actually becoming our own competitors and building up a price which it was probably unnecessary to do in the first place. Undoubtedly, that company would have benefited from an investment into it by the UK taxpayer when it would have come here for a lot less. That is a constraint on the system which the Government should look at.
The other area where we find serious constraints is the availability of the right, properly serviced, sites which are needed to attract major investors. It was interesting to hear noble Lords compare those people who want to buy a business with those who want to invest in creating a new business with new employees, new technology and new buildings. The one who wants to invest in a business will invariably go into an area where there is already activity and where businesses are
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already operating. Those who want to invest in new businesses and want to make major investments for a long-term future want green field sites. When one examines the major investments that have been made into Britain the companies concerned have been attracted by the green field sites that were on offer.
My noble friend mentioned the investment that had recently taken place in the North East of England. The company concerned was attracted by the special green field site on which it was able to build. In the North West we are finding it more and more difficult to find those sites. There needs to be a positive view from the Government, from the local authorities, and from what is now the greater Manchester area, and the Merseyside area to provide the sites that will attract investors who will take a long-term view.
A positive message has come out of inward investment. It has brought a great many opportunities to Britain that would not have been there before. But we need to appreciate what the customer wants. Whereas when we talk about businesses we emphasise the importance of the customer, we sometimes try to push investors where they do not necessarily want to go. One of our major companies in the North West wishes to expand very considerably. We are talking of 1,000 employees or more. It makes sense for that company to expand on the side of its existing site, where it has the skills and the opportunities. It is not in a development area. It is not in an area to which any support is likely to be given. Therefore, it is finding it very difficult to put forward a case which would enable it to get support. Yet an incoming company from, say, Taiwan could go to a site where we might want it to go, or where society felt it was more appropriate to invest, and it would get a great deal of support. It would be encouraged and the British taxpayer would be asked to foot yet another bill. That issue needs to be looked at more closely.
If we really want to encourage as much reinvestment from our own economy as we do to encourage that from outside, we have to make sure that we do not control things to such an extent that we act against our own investment and encourage someone else to come in who might not take a long-term view.
I conclude by congratulating the noble Lord, Lord Borne, on his maiden speech, which was a splendid contribution to the debate.
4.15 p.m.
Lord St. John of Bletso: My Lords, even though the noble Lord, Lord Borrie, has just moved on, I join in congratulating him on his most interesting maiden speech, coming, as he does, with all his expertise and experience, from the Office of Fair Trading. I should like also to thank the noble Viscount, Lord Oxfuird, for introducing today's debate.
In speaking in this debate, I ought to declare an interest as a financial consultant to Merrill Lynch, with particular responsibility for promoting United Kingdom stocks and shares to the Japanese market. Only yesterday I was asked to present to a leading Japanese bank the reasons for my bullish stance on why it should invest more into our market.

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The noble Viscount, Lord Oxfuird, has already given a number of reasons why the United Kingdom has attracted the largest single share of inward investment into the European Union. While this debate focuses on the level of inward investment into the United Kingdom, rather than get bogged down by the myriad of comparative facts and figures, region by region, I would prefer to focus my remarks on why the United Kingdom is such an attractive market for inward investment, particularly for the Japanese, but also on what needs to he achieved to make the market even more attractive.
The main factors that have been mentioned for the attractiveness of the UK for inward investors have been our comparatively low labour costs, the comparatively low and simple corporate tax system, the relatively low levels of industrial disputes as well as the attractive financial incentives that have been given in certain regions. However, just as important is the fact that, for many international companies investing into the UK, it is an ideal entrée into the European Union. The noble Viscount, Lord Oxfuird, has already mentioned—and the noble Lord, Lord Geddes, will be mentioning it later on—the importance of English as a business language. Another positive point, particularly to the Japanese, is our comparatively stable currency and our low levels of inflation and interest rates. As well as low labour costs, there are also low levels of severance costs compared with many of our European partners.
One statistic that particularly impressed one of my Japanese investors was that last year marked the lowest number of days lost due to industrial disputes since the 1890s, unlike France which was almost paralysed by strikes last year. The fact that unit labour costs in Britain are so much lower than in Germany and that British manufacturers can produce car components of equal quality for around 60 per cent. of the cost in Germany is also noteworthy.
The influx of Japanese manufacturers has not just created much needed jobs, but has also created greater awareness of the need for world class standards of quality, efficiency and productivity in the global market place. In many cases that has resulted in the transformation of working practices in the United Kingdom.
On the point of quality of product and quality of services, it is worth mentioning that so far in Britain almost 50,000 companies have received certification through ISO 9000 quality management systems and there is an annual 10 to 15 per cent. increase in the take-up of this certification. I was interested to hear the remarks of the noble Lord, Lord Wallace, when he spoke not just about the importance of inward investment, but called for investment by British companies into their own companies here and asked what measures Her Majesty's Government will give to such companies to invest more here.
Only last week I was involved in the presentation ceremony to the Swindon Chamber of Commerce on achieving recognition to the ISO 9000 quality management systems. ISO 9000 is one of the most internationally recognised documented quality systems and has been the basis of an introduction of a culture of greater efficiency to many companies.
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As my home is in Wales, I should have liked also to have spoken this afternoon to the debate, to be introduced by the noble Viscount, Lord St. Davids, on the economy in Wales and the reasons why Wales has been so successful in attracting inward international investors. International employers have commended their Welsh workforce for being flexible and stable with few industrial disputes. In fact, a survey of Japanese managers found that they liked the general working environment, the opportunities for career development—as well, of course, the sporting facilities—and the warm welcome that they were given by their Welsh friends, a point that has already been made by the noble Viscount.
However, as in many parts of Britain, with foreign-owned companies becoming more technologically advanced, there has been an ever-increasing need to upgrade the skills of the workforce. This need for improved skills training remains as urgent as ever. The perception remains widespread that the United Kingdom's skills levels are low and that it will take much more than marketing and inter-agency co-ordination to put that right. Apart from the attractions of low labour costs, low levels of industrial disputes and attractive financial incentives in some regions, there is the added requirement of a good infrastructure, transport links, green field sites and healthy living conditions.
Perhaps I may mention very briefly the financial services industry, particularly as regards the Japanese. London remains the undisputed headquarters of the Japanese banks and other financial institutions in Britain, with almost 700 Japanese firms here. London, with its many sushi and karaoke bars, Japanese newspapers, schools and other services—not to mention the many golf courses scattered around London—offers an extremely attractive location for Japanese investors.
I would have liked to have spoken more on the role of the City in attracting foreign investment, but time precludes me today from doing so. This subject was examined in an article in the Financial Times on 2nd October last year and has been extensively covered in the most interesting report that I read in September by London Economics, The City and Inward Investment: Revitalising the UK Economy.
In conclusion, it is clear that inward investment is not just a matter of the creation of new jobs, but it is also the addition of new technology, new products and, most importantly, new management. I wholeheartedly support the Government's business links programme initiative, despite its initial teething problems, in offering a one-stop shop for investment inquiries both for domestic and international businesses, of what government services are offered to them. I would also like to commend the work of the Invest in Britain Bureau established by the DTI for promotional investment in the UK as a whole.
As we know, there are a number of excellent agencies promoting inward investment. The noble Lord, Lord Wade, and the noble Viscount, Lord Oxfuird, have already mentioned English Partnership, which has been providing valuable links between regional and local

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agencies promoting inward investment. The improvement in co-ordination between national and regional agencies has clearly helped to improve inward investment. I shall be interested to hear from the Minister what additional plans the Government will be providing, particularly in the field of training, to promote the quest for more inward investment here in the years to come.
4.25 p.m.
Lord Cuckney: My Lords, I wish to make particular reference to the financial services area. Although I have had past involvement in banking, merchant banking and insurance, I have no current connections which call for a declaration of interest.
The growth of inward investment in the financial services area has been impressive. The number of foreign banks in London has increased sevenfold in the past 10 years and there has been a significant increase in the number of overseas companies, American, Japanese, EU and non-EU, which have chosen London as their European headquarters.
There is a tendency to consider inward investment too much in terms of the manufacturing industries. OECD figures show that nearly one half of inward investment into the UK is in the services sector, one-fifth of that in finance, insurance and business services. The growth in the importance of the City is well illustrated by the latest figures from a Bank of England survey showing that average daily foreign exchange dealings in London total 464 million US dollars a day, nearly 60 per cent. higher than in 1992 and far exceeding the turnover of New York at 244 million dollars and Tokyo at 161 million dollars. The UK still attracts the largest amount of inward investment in the European Union. Although overall investment in the European Union as a whole has declined, the largest amount of it comes to the UK. I do not believe that the Government's present European strategy is exactly putting investors off.
The attraction of the financial services sector and especially the City of London lies with the increasing globalisation of markets and in the professional skills and services which exist in the City. I personally welcome the open door policy of the Treasury and the Bank of England encouraging the growth of remote trading based in the City. For instance, the City has now become the world capital of the Eurobond market, the largest non-governmental bond market in the world. This exploits to the UK's benefit, with valuable invisible earnings, the critical mass of skills and services which are absolutely essential for an international financial centre.
It is worth recalling the definition of the International Monetary Fund of foreign direct investment, which is inward investment, as,
"investment that is made to acquire a lasting interest in an enterprise operating in an economy other than that of the investor, the investor's purpose being to have an effective voice in the management of the enterprise".
I welcome the presence of foreign members on both the City's supervisory bodies and on bodies promoting the City. These policies, particularly the open door policy,
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led in 1994 to a 30 per cent. increase to £20.4 billion in the City's contribution to our invisible earnings. Without such policies, I do not believe that London would have been able to establish itself, as it has done, as an international financial centre.
It is important that we recognise the steadily improving effectiveness of our regulatory and supervisory systems. That will further help the international respect for, and the attractiveness and competitiveness of, the City as an international financial centre.
The Treasury and Civil Service Select Committee of another place in its sixth report on The Regulation of Financial Services in the UK, published last October, makes two, among other, important points:
"Failures in the regulation and supervision of that industry do not simply have financial consequences for the individuals concerned; they can also threaten the balance of payments, the stability of the currency and the prosperity of the national economy as a whole, to the extent that they threaten confidence in that industry".
Secondly, the committee noted that the regulators, in evidence to the Committee, pointed out that it is no longer strictly correct to talk about a self-regulatory regime as that description now fails to recognise the independence of the regulators and the statutory basis of their authority.
It is necessary, when considering the environment which encourages inward investment—low inflation, low taxation, low interest rates, good industrial relations—to bear in mind also the great importance of a supervisory and regulatory regime which must somehow strike a balance between being effective and clearly understood but not excessively bureaucratic and onerous. I believe that that balance, with some refinements, has now been struck, and I hope that my noble friend the Minister will feel able to endorse the point. There is incidentally a timely article in today's Financial Times warning against success in business depending more often on satisfying officials rather than the customer and warning against regulatory creep.
4.32 p.m.
Lord Desai: My Lords, first, I owe an apology to the noble Viscount, Lord Oxfuird, for not being here when he opened the debate. I hope that he received the apology I sent him. I missed the speech of my noble friend Lord Borrie, but the speeches I have heard have persuaded me of how much in this House we hear distinctive speeches from Members who know the different aspects of the problem. We do not just repeat or engage in party disputes. I was especially impressed by the speech of the noble Lord, Lord Cuckney. It is the first time I have heard him speak, and I learnt a great deal from him.
Noble Lords have spoken on different aspects of the subject, but I want to emphasise, first, that one must welcome inward investment, partly because if anyone gives us money, that is always a good thing so long as we make good use of it; and, secondly, that in a globalised world we will have increasingly to forget the artificial distinction between national and foreign investment. What will matter ultimately is the total volume of investment. It does not matter greatly from

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where it comes. I know we still have a hankering to have some of our people running our factories and for foreigners to go away, but that is wrong and increasingly irrelevant. When Honda (USA) exports more cars to Japan than General Motors, one wonders which is the American corporation and which is the Japanese corporation. But that distinction is no longer relevant.
We can point also to the remarkable revival of the British car industry. The British car industry had its last gasp in the late 1970s and early 1980s. Today, it is predominantly foreign owned, but that does not matter because the workers are British. The interesting point—the noble Lord, Lord St. John of Bletso, pointed this outߞis that foreign investment does not just bring money and technology but a distinctive style of management. It is to the credit of Japanese and American management that, while we used to hear complaints of how the British worker was lazy, recalcitrant and all that, the same British worker performs successfully for the Japanese manager.
We must ask ourselves in relation to inward investment: what is it about the quality of management that the Japanese and the American managers bring which somehow, for reasons which I do not understand, we have failed to reproduce? The paradox of course is that we send out more investment than we bring in. We have always done that. British business can be very successful abroad. It is perhaps more successful than native business abroad, but at the same time foreign business is more successful here. We should perhaps export our capital and managers and import foreign capital and foreign managers. Then the whole world would be a better place in which to live. But I do not know about that.
While we talk about numbers—it is important to talk about numbers—it is not the amount of the investment as such but what it yields that is important. Inputs count less than outputs. After all, the Soviet Union had a tremendous amount of investment, but it was low yielding. What we are looking for are investors who obtain a greater yield from the investment than just the investment. My noble friend Lord Haskel—I say this parenthetically—almost did himself out of a job when he said that just because a man can make money he need not be a good policy maker. I hope that he will not talk himself out of a job when we are in government.
My noble friend drew the vital distinction between certain kinds of investment which were merely established assets changing hands without a great deal of value added and assets to which value was added. It could be just an old factory taken over. The important distinction is whether the new owner transforms the factory, adds value, changes work practices or acts merely as an absentee landlord. A greenfield site may be better than a non-greenfield site, but whatever it is, the crucial point is what distinctive value is added.
In that respect—leaving party considerations aside—one should examine seriously not just the level of inward investment, which is high, but the fluctuations in inward investment. As my noble friend Lord Haskel pointed out, inward investment was low in 1994 but it
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was high again in 1995. In the first six months of 1995 we had as much inward investment as in the whole of 1994, or so I gather from a story in the Financial Times.
Inward investment here is influenced as much by what happens abroad as by what happens here. It is not just a question of our pull factor; the push factor is also important. It is not enough just to be smart, intelligent and attractive to foreign investment. We must understand their economies and their markets and what we can do to attract inward investment. It is probably the sorry state of the Japanese property market and the situation in which the Japanese banks find themselves which have led to the reduction in Japanese outward investment rather than anything particular about the British economy. That applies similarly to some European economies.
Lastly, on the problem of attracting inward investment and regional competition about which the noble Lord, Lord Wade, talked, we sometimes have regions competing against one another. With the establishment of the IBB, things will be better.
Perhaps I may raise the following question which may need an answer. Is it right that British taxpayers should enter the battle over regions, or should we not have some sort of financial mechanism whereby regions in England, Scotland and Wales have their own fund to attract investment? Some of that investment could come from local taxation with a little national subvention, but let us have competition among the regions. Regions should bear the burden and the capacity for attracting investment, and while the British taxpayers may pay something, let it be part of the general local authority or regional finance grant. I would rather have more heterogeneity, more competition and less allocation. It may lead to some interesting outcomes.
We must also bear in mind that while we are doing all that we must attract domestic investment, in part to increase the present amount and in part to attract better management to accompany that investment. That alone will ensure that we survive in the new globalised world.
4.40 p.m.
Baroness Seccombe: My Lords, I wish to add my thanks to my noble friend Lord Oxfuird for initiating this debate on a subject of such vital importance to this country. I congratulate the noble Lord, Lord Borrie, on his maiden speech. I am sure that Members on all sides of the House will look forward to his next contribution.
Over the weekend I was in Switzerland. When I said that I had to spend some time preparing for today's debate on inward investment, one of my friends immediately suggested that I should have a howl of muesli. Whether that was to ensure that my brain got into gear or whether he felt that the ultimate had happened and we were now exporting such a Swiss product as muesli, I am not sure; but whatever it was I thought it was not had advice.
The problem with having a long-lasting Conservative Government is that the memory of the situation before 1979 can fade. However, one thing is certain: what will never fade is the horror and humilation of being seen as the sick man of Europe by our overseas competitors. I

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am not surprised that that was so because we had record strikes, record inflation and record misery for our people, culminating in the winter of discontent. Other countries saw us as a nation almost ungovernable, the unions in control and a workforce unable to operate because it was forced to go on strike.
Let us also never forget that in those years the price of gas and electricity was controlled by the Treasury and was always spiralling upwards; and the rates bills in Labour-controlled authorities were quite out of hand. How on earth could anyone start a business with such unknown factors? Today is so different, with a stable economy and the price of gas and electricity falling in real terms since privatisation. The business rate is pegged across the country.
In marshalling my thoughts I felt that my comments could apply to both of today's debates, as the inward investment that we enjoy today is spread across the land from, for example, South Antrim in Northern Ireland, Pontypridd in Wales, Stirling in Scotland to Torbay in England; and by countries such as Japan, the USA, Germany, Korea, Belgium, Taiwan, Canada, France, Sweden and Turkey. In total there were more than 450 investment successes in the year 1994–95. They are in a wide range of industrial sectors, including automotives, chemicals, engineering, electronics and pharmaceuticals.
The world's view of Britain today as opposed to the view of the Opposition parties is of a vibrant economy, with low inflation, low tax and a workforce better paid and producing some of the best goods in the world. Of course we are seen as a haven within the EU, not affected by the dreaded European jobs tax. The Prime Minister played a master stroke when he secured an opt-out for this country so that we do not have to embrace the Social Chapter or the minimum wage and the extra tax that they would create on jobs.
Many people underestimate the impact of the minimum wage and its effect on jobs. They often fail to take differentials into account. The DTI calculated that a minimum wage of £4.15 would cost 950,000 jobs if only half the restoration of wage differentials were implemented. But if the full differential were taken into account, that figure would rise dramatically to 1,800,000. We know who would suffer; it would be the young and the unskilled.
We have only to see the effect on the countries of our European partners. In Spain total unemployment is 22.2 per cent., with youth unemployment at 40.3 per cent. In France the total is 11.3 per cent. and youth unemployment is 26.5 per cent. In this country the total is 8 per cent. and youth unemployment is 17.2 per cent. I believe that there is a realisation across the Community that some of these enforced measures are detrimental to the interests of individual countries.
The name "Social Chapter" sounds warm and friendly but it is in reality anything but warm and friendly. It is a mechanism for enforcing social policy on member states and, with the added qualified majority voting, it would impose measures on this country whether the
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British Government liked them or not. That would only undermine our competitiveness and make us once again unattractive to foreign investors.
Inward investment is responsible for creating and safeguarding more than 700,000 jobs since 1979. They are jobs of high quality, permanent and well paid and in projects across the whole country, often in areas where jobs are desperately needed. Government cannot create jobs; they can create only an environment in which entrepreneurs create the jobs.
This country is now seen as a place to invest if investment is to take place in the European Union, making the UK the centre of the enterprise economy. More than one-third of all such investment in the EU comes to this country. The USA heads the list with 43 per cent. of its EU investment in the UK. Of course, we must remember the effect that that investment has on our exports. Approximately 40 per cent. of our exports are accounted for by overseas firms. Whoever thought that we should see the day when we were net exporters of television and exporting more cars than ever before in our history? In Japan today a British car is much valued for its reliability and quality, which is a far cry from the days when stories abounded about the Friday car.
The Government, through the DTI, must be congratulated on their foresight and determination to attract overseas firms here. The success continues and it would indeed be a tragedy if it were stopped in its tracks by the European jobs tax. Those who flirt with such ideas should think very carefully. Fortunately, we have a Government who understand trade and its effect on the lives of our citizens. Long may they continue.
4.47 p.m.
Lord Astor of Hever: My Lords, I welcome the debate introduced by my noble friend Lord Oxfuird as it gives your Lordships' House a chance to hear just how much recent inward investment there has been to this country. For the past decade and a half British business has closed the gap against some of the best, most innovative competition in the world. In the words of Jan Timmer, President of Philips:
"The most competitive country in Europe today is the UK. It has a great sense of realism and a great sense of competitive spirit".
One of the best indicators of competitiveness is the extent to which we are able to attract multi-national businesses which are free to choose where to invest.
The United Kingdom's car production has increased by 600,000 since 1982, over half of which is due to Japanese investment, which has directly created thousands of jobs and further substantial employment in the component sector. Japanese car plants are expected to increase production by a further 0.25 million vehicles by the turn of the century. Those investors have brought worldwide management practices to this country and have spread them to sectors that were performing badly.
Those companies, which must have very good reasons to invest in the UK, come because we have the best environment for business. This has been achieved partly through deregulation, with more than 500 measures repealed so far under the deregulation

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initiative. A low cost base, union co-operation and a skilled and hard-working labour force, sterling competitiveness and a stable economic environment mean that few countries present as benign an economic environment for making cars. We are inside Europe (which is a big attraction) but have rightly opted out of the social chapter with all its extra non-wage costs.
The strength of the fast-growing automotive components industry in Wales was highlighted with the announcement last year of three inward investments which will help to safeguard and create hundreds of jobs. American domiciled Ford chose its Bridgend plant to produce a new range of engines for its hugely popular Fiesta. Gillet from Gwent clinched an order from General Motors to supply 850,000 exhaust systems a year for the new Vauxhall Vectra saloon, and British Steel's Llanwern steel works, also in Gwent, is to supply steel for the new Mitsubishi Carisma. South Wales now rivals the West Midlands as the automotive capital of the UK.
Rover has gone from strength to strength since the BMW purchase. At the time, I well remember the Labour Party's fulminations over the way Britain's best volume car producer had been sold at a "knock-down price" to the Germans. The chairman of BMW now calls Britain,
"the most attractive country among all European locations for the production of cars".
He is backing that confidence with massive investment in Rover's future.
For every new job in the expanding car factories, there are probably two more created among the other businesses which service them. As production levels in British car factories rise—both Honda and Toyota are planning to double their capacity—a virtuous 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, including axles and engine blocks which have hitherto been shipped in from elsewhere for reasons of economy of scale: the British-made content of British-produced cars could rise eventually to 95 per cent.
The component industry, including thousands of smaller British-owned companies, is now 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 to continental car firms, which have been forced by cost pressures, against their nationalist interests, to source parts from abroad. The perfect illustration of this turnaround was the announcement that Lucas is to supply a billion pounds 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.
Ford, the country's largest inward investor last year, is delighted with its purchase of Jaguar. I had the privilege of visiting Jaguar yesterday with, among others, my noble friends Lord Oxfuird and Lord Brougham and Vaux. The turnaround since Ford made
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its enormous investment in 1989 has been dramatic—33.9 cars per man per annum were produced in 1991; last year, the figure was 69, which is more than double. Last year Jaguar's import bill was £120 million, hut it exported £1.26 billion-worth of cars.
However, there is no reason for complacency, and I was astonished to hear that Brussels' approval for local authority grants for the new Jaguar X200 on a brownfield site in Birmingham has been so slow in coming. Brussels have been examining this matter since July last year. We are not talking about this factory going anywhere else in Europe, but if a decision is further delayed, Jaguar will build the new car in the United States, where it will be warmly welcomed and a suitable factory is already available—and who can blame it?
I have long seen the commercial benefits of being in Europe. However, in a world where investment is free to flow around the globe, I cannot see why those decisions should take so long. Are the European technicians unable to validate the level of grant? Are they really prepared to drive away a £500 million investment programme that could treble Jaguar sales? I should be grateful to hear the comments of my noble friend the Minister on this specific matter, and hope he will be able to tell me what Her Majesty's Government and the DTI are doing generally when faced with incompetence or unwarranted delays on inward investment decisions from Brussels that put at risk hundreds, and sometimes thousands, of British jobs.
4.56 p.m.
Viscount Waverley: My Lords, it is appropriate as we draw nearer to a general election that we carefully consider Government policy. The electorate will shortly have the opportunity to express its wishes and to determine what policies it wants from the next government, but does it have sufficient information to make an informed decision? The noble Viscount, Lord Oxfuird, is therefore to be congratulated on enabling serious discussion of this important subject. Government policy must continue to facilitate the United Kingdom's role as the premier location for development as a European hub.
There are two issues of fundamental concern to me. What degree of competitiveness is required to guarantee high levels of inward investment, on the one hand, and, on the other, would the professed policy of the Labour Party, to sign away our opt-out of the social chapter, enhance or hinder that position? I believe that to be a central issue of the debate this afternoon. The question has perplexed me since the short debate on inward investment last year.
I want to understand the answers to the following questions. First, will the United Kingdom be any less competitive as a result of the social chapter? Secondly. will the value of people's pay packets be adversely affected as a result of the social chapter? We know that the Germans and the French are paid more, but they have higher costs. Will UK spending power increase proportionately as costs rise? If the Labour Party signs away our opt-out of the social chapter and sets a

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minimum wage, whatever that rate may be, employers will surely pass the extra costs of higher salary levels on to their customers.
If the social chapter is such an attractive proposition, what is the reason for Germany having 9.9 per cent. unemployment and France having 11.5 per cent., while the United Kingdom's unemployment levels are 8 per cent. of the workforce? Would employers lay off in order to increase productivity? That would mean higher unemployment. There may be flaws in those suppositions and I would, therefore, be grateful to hear how those dilemmas would be dealt with.
5 p.m.
Lord Geddes: My Lords, as other noble Lords have already stated, we are indeed immensely grateful to my noble friend Lord Oxfuird for his initiative in tabling the Motion for debate this afternoon. My intervention will he brief and, as alluded to by my noble friend, it comes from what perhaps may be described as a different angle; namely, the increasingly dominant position of English as the language of international business. Encouraging proficiency in the English language to speakers of other languages is, if you like, an outward investment to encourage and facilitate inward investment.
Not least following the recent deadline of this House, I declare an interest as non-executive—and, indeed, non-remunerated—Chairman of Trinity College, London. It is a United Kingdom company whose principal activities are to offer training and assessment for teachers of English to speakers of other languages and practical examinations and assessments of proficiency in the English language for speakers of other languages.
I hope that it may be of interest to your Lordships if I use Trinity as an example of the way that the English language is growing in importance world-wide. Indeed, I am proud to be wearing the Queen's Award for Industry tie, the award having been granted to Trinity in April of last year.
Noble Lords: Hear, hear!
Lord Geddes: My Lords, of course it is essential to have the right environment and climate to encourage inward investment into this country. Other noble Lords have rightly concentrated on that area. My premise is that it is also important that those who do invest in this country can communicate easily in our own language. There is a certain amount of chicken and egg in the situation. Clearly those who have made the decision to invest within the UK want their non-British employees based in this country to be able to speak English proficiently. In that context, I shall cite an example in a moment.
Outside the UK it is almost as important—at one remove, if you like—to encourage proficiency in English for those for whom it is not their first language in that, I believe most strongly, such proficiency in English may well influence an overseas company to
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invest in the country where there is already proficiency in its language. The BBC World Service (both radio and television) continues to have a very important role in that context.
The English language, and particularly spoken English, is now acknowledged to be a most valuable invisible export. Its teaching and examination represent an annual source of income for this country which, although difficult to quantify, is certainly measured in terms of hundreds of millions of pounds. In the exploitation of the opportunities presented by this demand for English, Trinity has adopted a policy of reinvestment to finance the design and development of a whole range of products, including: graded examinations for students of all ages and levels of ability; publication of syllabus support materials; and qualifications for the certification of teachers of English to speakers of other languages.
By way of illustration on the point of reinvestment, while Trinity's revenue has grown by 21 per cent. over the past three years, its reinvestment has increased by 75 per cent. I have just two more statistics to prove the overall point. Over those past three years, Trinity has increased the number of its examiners by 44 per cent. and a number of countries in which the examinations are held by 43 per cent., including, last year, countries as diverse as Uruguay, Argentina, Mexico, Hungary, Iran and, indeed, Outer Mongolia.
I mentioned earlier that the knowledge of English overseas was itself a potential encouragement for companies to invest in this country. There is also a growing demand from companies which have already taken that decision to invest to improve the linguistic capabilities of their employees. Last year, Samsung (a multinational South Korean company which has already made huge investments within this country) recognised a fundamental need for their employees to gain greater proficiency in English. It approached Trinity to seek assistance. The response has been to initiate a project in close co-operation with the company, with the objective of developing a corporate language training programme, tailor-made to suit the specific needs of the company but designed in modular form with the capability of being adapted and modified to suit the varying requirements of other multinational companies which might recognise the need for similar services.
There is every reason to be optimistic about the continued advancement of English as the international language of communication from all areas of business and commerce. A recent survey conducted world-wide by the British Council as part of its English 2000 Project found that 95 per cent. of respondents agreed with the proposal that,
"English will retain its role as the dominant language in world media and communications".
Companies employing a workforce which is made up, either wholly or in part, of speakers of languages other than English will need to address that problem if they are to enjoy real success in international markets. It will not surprise your Lordships that I believe that that will result in a substantial demand for corporate, English language training services. Expansion in that context

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and substantial growth in demand from those overseas should—it is to be hoped—encourage foreign companies to invest with linguistic confidence in this country.
5.7 p.m.
Lord Goold: My Lords, in his absence, I should like to add my congratulations to those already expressed to the noble Lord, Lord Borrie, on his maiden speech. I should also like to thank my noble friend Lord Oxfuird for initiating this debate on such an important topic. Inward investment, particularly to Scotland over the past decade, has been a real success story, with many high quality jobs created.
More than any other sector in Scotland, electronics has benefited from inward investment. Electronics is a global industry with overseas-owned plants generally highly integrated within European and global networks. Hence, the situation of the Scottish industry will continue to be strongly affected by competitive dynamics among the major players. Equally, the stability of growth of overseas-owned units in Scotland will largely depend on the importance to the parent of its Scottish facilities in terms of plant role and performance and the local operating conditions which support plant performance vis-à-vis sister plants elsewhere in its world-wide corporate network. Those local operating conditions are good at present but they may not always be so, as I shall show.
The overseas-owned sector has provided a major stimulus to productivity improvement in Scotland and is a source of relatively high-paid jobs and capital investment. There is evidence that it has also helped indigenous investment, which is vital.
In electronics, as in other areas of inward investment, Scotland has benefited significantly from the development of the European Union to date. Scotland, with a generally well-educated workforce, is a good, efficient base for entry into the European market.
The United Kingdom is the main recipient of US and Japanese investment in the European Union, with nearly three times that of Germany, four times as much as France, six times as much as the Netherlands, and seven times as much as Italy. That has had a particularly beneficial impact, especially in the central belt of Scotland.
A short time ago there was a tremendous outcry at the closure of the Ravenscraig steelworks in Lanarkshire, yet today unemployment in that area is lower than it was when Ravenscraig was operating. That is thanks, to a very large extent, to inward investment. There are, however, two matters of great concern on the horizon which could put all this at risk. This Government have opted out of the social chapter but the Opposition have committed us to it in the event of their winning the next general election. This would, I believe, be disastrous.
I should like to give just one example which illustrates clearly the cost of the social chapter. A British company which I know employs a young married man at its office in Brussels. That individual's net cash salary—his take-home pay—in 1995 was £29,415. The
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gross equivalent in Britain would be about £45,000. However, the cost in 1995 to the British company situated in Brussels was £82,239. That additional sum of around £35,000 is what the social chapter and Belgian social laws and taxes cost, and it is what would he added to employment costs in this country if we were to join up to the social chapter. We should have none of it.
The other concern which, like others, I wish to mention is the "tartan tax". Not being a civil servant I am allowed to call it a "tartan tax". It is what we would have if Labour's devolution policies for Scotland were enacted. Does anyone really believe that if taxation in Scotland were 3 per cent. higher than in other parts of the United Kingdom, Scotland would not suffer? Of course it would suffer. Companies would relocate, as we heard the noble Lord, Lord Laing, say earlier. Higher paid individuals would move their main place of residence south of the Border. I cannot believe that an American, or a Japanese, or indeed any company, would choose to go to central Scotland rather than the north of England if there were a 3 per cent. difference in tax in England's favour.
The actions of this Government to encourage inward investment have paid great dividends. The actions of this Government in opting out of the social chapter are fully justified by the figures I have given which show Britain with several times the inward investment of our European partners. The actions of this Government in devolving power to Scotland and Scottish local authorities—but without the monstrous, costly bureaucracy which would attach to a tax raising assembly or Parliament—are correct. If we had the social chapter and if we had a Scottish assembly, not just inward investment would suffer but every worker or would-be worker in Scotland would suffer. As we heard during the discussion on the second Starred Question earlier this afternoon, unemployment is higher, and is rising, in our European partner countries. That is what would happen here if the Opposition policies were to be introduced. This Government's record on inward investment in recent years is excellent and long may it continue.
5.13 p.m.
Lord Rathcavan: My Lords, I am grateful to the noble Viscount, Lord Oxfuird, for this opportunity to address the subject of inward investment which is of such vital importance to my region of Northern Ireland. I should declare an interest as chairman of the Northern Ireland Tourist Board and also as a director of a French owned and an Australian owned company.
The Northern Ireland Tourist Board is, of course, deeply involved in attracting—and with some success—inward investment to our tourism infrastructure. In terms of job creation we are also making level progress with our colleagues in the Industrial Development Board of Northern Ireland. As I have said to your Lordships before, new jobs and a return to economic normality arc the cement of peace.
Since the ceasefire in September 1994, and during the subsequent peace process, we can at last operate on an almost even playing field with other regions of western

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Europe and our neighbours in the Republic of Ireland in particular. The figures for inward investment inquiries and visits by potential investors have soared. Considering that it is a long-term process to convert inquiries into real projects, much progress and success in creating new jobs from inward investment have already been achieved in 1995. Particular tribute should be paid to the noble Baroness, Lady Denton, our Minister responsible for the economy in Northern Ireland, for her tireless efforts in travelling the world and selling the region of Northern Ireland so successfully as a cost-effective and efficient production base for the European Union market.
I hope that the noble Baroness, Lady Denton, will also keep an equally keen eye on how the peace dividend—that is, the reductions in security related expenditure—is being distributed. We see signs of the Treasury trying to get its hands on it. That is fair enough in due course, but at this critical time for Northern Ireland it is essential that the cash benefits of this peace dividend are channelled into the right places, particularly those agencies which are responsible for the pursuit, from so many angles, of inward investment, greenfield projects which we need so badly, and for which we are now well placed. Those agencies must have adequate funding if they are to remain competitive. I hope that the Minister will pass on those comments to the noble Baroness, Lady Denton.
Northern Ireland is overcoming its natural disadvantages of peripherality. One of these disadvantages is high electricity prices which are forcing some companies such as Shorts—a fine example of successful inward investment—to generate its own electricity. I hope that the proposals by the electricity regulator, which were announced this week, to change the way in which our electricity industry has been run post-privatisation, will be heeded and will lead to lower prices. However, against that, we have one of the best telecommunication systems in western Europe using a fibre optic network with much lower tariff costs than our competitors.
We have an outstanding resource in the availability of well educated and skilled employees. Only last week it was announced that Northern Ireland had the highest pass rates in GCSE and A-levels of any region in the United Kingdom, and the highest proportion of school-leavers going to third level qualifications. We also have an excellent record in labour relations and a positive contribution from our unions.
Often the key to a decision to locate in a particular region is not the level of production costs, the tax breaks or the cost of transport, telecommunications and energy, but the quality and flexibility of the labour force. The absence of the social chapter is another increasing advantage in our hands as our principal and natural competitor, the Republic of Ireland, begins to introduce legislation on the many EU directives which are involved in the social chapter.
The net benefits to the Republic of Ireland of full membership of the European Union are huge but the social chapter will add substantially to its non-wage labour costs. It will make some employers less disposed
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to employ women and it will prevent jobseekers from obtaining part-time work, while employers will work out ways to expand their businesses and increase production without increasing employment. That is the view of IBEC, the equivalent of the CBI in the Republic of Ireland. I believe that the measures of the social chapter will discriminate against normal and natural job creation.
It is interesting to reflect this week on the current case of the Fokker aerospace company in Holland. That situation is threatening 1,500 jobs in Northern Ireland and perhaps 20,000 jobs in Europe. It is a salutary reminder of what happens when one has a social chapter. Fokker is going down because the social chapter made it impossible for the company to shake down its business quickly enough. In the real world of the airline industry we are dominated by US manufacturers because they have a flexible labour market. One cannot compete if one cannot control one's costs. That is what happens to an employer who is unable to respond to his competitors in the marketplace, as was the case with Fokker.
In Northern Ireland we now have a unique opportunity to heal the wounds of the past 25 years. Inward investment must play a vital part in that healing process of a return to economic normality. We are, on the whole, well positioned to seize the opportunities that now exist as world companies seek to globalise their operations and position themselves for market access. I believe that, given a fair wind, we shall succeed.
5.20 p.m.
Lord Lyell: My Lords, like many noble Lords, I wish to begin my remarks by thanking my noble friend Lord Oxfuird for giving us the opportunity this afternoon to discuss a subject which is rarely discussed in your Lordships' House on a Wednesday. It is an area where politics tend very much to take second place. We are discussing jobs and we are discussing winning. In addition, my noble friend has given us the opportunity to hear an outstanding maiden speech by the noble Lord, Lord Borrie. All of us hope that we shall hear further speeches of such quality from him often in the future.
Speaking once again, with another noble friend with the same name as myself, as tail-end Charlie on the list of speakers, I feel rather like the character in the Danny Kaye song,
"The king is in the altogether",
because all the points that I should have liked to make have been made by fellow Scots. My noble friend Lord Goold, as a typical Scottish chartered accountant should, made a very interesting point about net and gross pay which had me working with my pen rather than my calculator. He also mentioned the electronics industry. My noble friend Lord Laing represented Scotland very well on behalf of the food industry and in particular the biscuits industry. I thought that we might have heard from one of my noble friends on the subject of films, but I shall pass that by for today.
The theme which has run through the debate is the need to identify success in areas where industry and entrepreneurs in the United Kingdom do well, to build

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on that and to identify friends who will help us to do so. The debate last week initiated by my noble friend Lord Astor, which has been referred to today, dealt with a typical example of an industry where there has been change, namely the British motor industry. We heard from my noble friend what he saw yesterday at Jaguar. Everything that was discussed a week ago in my noble friend's debate related to an outstanding example of inward investment and the utilisation of the enormous talents of small and middle-sized companies in one particular field of motor sport in the United Kingdom. The noble Lord, Lord Wallace, will appreciate that that is one example of the British mittelstand of small companies thrusting up and building on and developing a core business of the motor industry.
Nineteen years ago, when my party was situated on the Benches opposite where the noble Lord, Lord Peston, and his noble friends are sitting, I recall taking part in debates on a Bill which completely rewrote the law on patents in the United Kingdom. As part of my studies on that Bill—which were carried on by my noble friend Lord Belstead—I became very interested in and heavily involved with the pharmaceutical industry. That is one indigenous British industry that has been immensely successful. It has also attracted a great deal of inward investment.
This morning I obtained a very interesting but lengthy document from, of all places, not the Department of Trade and Industry but the Department of Health. It is called Prescribe UK. My interest has nothing to do with the fact that for the first time in 25 years I am taking antibiotic pills as a result of skiing injuries. The document is a valuable source of information.
That booklet gives very good professional and specific advice, sources of information and useful addresses. The Prescribe UK initiative includes an advisory team to advise outside investors who may wish to come to the United Kingdom to make use of the outstanding talent, achievements, scientific knowledge and education which we have throughout the United Kingdom. The advisory team includes the chairman of the number one company in the Financial Times list of companies, which happens to be a leading pharmaceutical company. There are five members of the team from various government departments, all of whom have had considerable experience in industry, accountancy or other disciplines which are relevant to investment and to presenting businessmen from all over the world with figures, facts and almost instant advice. The team includes one investment banker from a leading Scottish firm in the City, I am delighted to see. He, too, was involved in pharmaceuticals. There are also two chief executives from the industry. With such an advisory team, all of whom can give superb and relevant advice, we see a perfect example of partnership. That is what the debate has been about.
In one chapter of the booklet, entitled Investing in the United Kingdom, it is pointed out that 98 of the 100 top companies mentioned in the American Fortune magazine have their European headquarters in the United Kingdom, and 100 of the top 200 Japanese companies have their European Union headquarters here. More than 100 have their research and
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development headquarters here in the United Kingdom. As my noble friend Lord Astor mentioned last week, all the development on Subaru and Mitsubishi rally cars is done in the United Kingdom.
In 15 years inward investment from all over the world has increased sevenfold. Therefore it seems that we are doing one or two things right. Is it the English language, is it the committed workforce that has been mentioned, or is it the fact that foreign executives so appreciate living in the United Kingdom, as is mentioned in the booklet? The booklet also indicates that schooling, housing and lifestyle are all relevant. All those factors are relevant in the success of a large number of companies about which we have heard today. It is also the fact that the indigenous pharmaceutical industry has attracted inward investment from throughout the world. It is a great success story. I am grateful to my noble friend Lord Oxfuird for giving me the opportunity to tell your Lordships about that today.
5.27 p.m.
The Earl of Shrewsbury: My Lords, I am indebted to my noble friend Lord Oxfuird for bringing the debate before your Lordships today. I add my congratulations to the noble Lord, Lord Borrie, on an excellent maiden speech. It is high time that such a serious subject, which impacts on the future of our industrial and commercial wellbeing for many years to come, was debated by people who have real experience and knowledge of the world outside Parliament.
It is often said that the British people are at their best when they are talking down the successes and achievements of this country. Sadly, we in the UK are often recognised as whingers. That should not be the case. We have a great deal to be proud of.
My thrust today is to sing the praises of the Black Country, Birmingham and the West Midlands in general. It is an area where I both live and work. It is a success story of some proportion. I place the Black Country first on the list because that is where, in small villages, through the skills and natural resources which were available, the first Industrial Revolution was produced. Some people think that it occurred near Telford, at Ironbridge. I can assure your Lordships that that is not the case.
I must declare my interest as Chancellor of Wolverhampton University, a very pleasant task and completely unremunerated. It means that I have a few letters after my name and, for the first time in my life, a qualification.
I have taken advice from chambers of commerce, development agencies and many friends involved at the cutting edge of day-to-day business within the West Midlands region. From the business point of view it is all too easy to carp habitually about the lack of help from government. Government are often perceived to be the providers of large grants and the cure for all ills. It is therefore interesting to hear businessmen in my area state that things are improving, that financial assistance from government is not at the top of their agenda and that interest rates are at a historically low level. It comes as a breath of fresh air.

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We rely heavily in the West Midlands on inward investment. We have a number of excellent organisations whose role it is to sell our attractions to foreign business. We have, for instance, the West Midlands Development Agency, the Black Country Development Corporation, the chambers of commerce and the TECs, to name but a few. The Black Country Development Corporation is, of course, winding down its operations. It has a limited life and will come to an end in 1997, but it has done much good work.
Various areas in our part of the world have been awarded enterprise zone status and those areas have been revitalised to a great degree by private sector developers taking on substantial risks. Recently, the Prime Minister announced that he wished the UK to become the enterprise centre of Europe. We in the West Midlands have the capacity and capability to do just that. Already in Birmingham we have the National Exhibition Centre, the International Convention Centre and many other venues of international importance. We have a first rate international airport which is about to benefit from a large expansion and investment programme. I pay tribute to Sir Bernard Zissman, a past Lord Mayor of Birmingham, who had the vision to expand the attributes of the city and make it a world class venue. He has done much to promote the region to foreign companies; he is an excellent ambassador for the West Midlands.
The region has been successful over a long period in attracting and retaining international companies. In the past five years overseas companies have invested £3.2 billion in the area, creating over 17,000 jobs and safeguarding over 25,000. Those figures do not include the recent acquisition by BMW of Rover. The region is now home to 1,100 overseas companies from 30 countries between them employing 120,000 people. The largest investing countries are currently the USA, Germany and Japan. However, the West Midlands does not enjoy the high profile of other regions such as the North East for the simple reason that comparatively large numbers of foreign companies locating in our area typically generate only between 50 and 60 new jobs. That is not a large enough figure to grab the headlines. One of our problems in attracting large companies is a lack of substantial sites of quality. The failure to secure the investment by Siemens was attributed to the lack of large sites and poor quality land.
The general perception of those whose business it is to sell the benefits of locating in the West Midlands is that there is a lack of political will and a certain failure of promotional bodies, politicians and others involved in the attraction process, to sing from the same hymn sheet. That has to be addressed if the region is to build on its past success and attract more foreign investment. In addition, funding for the West Midlands Development Agency is inadequate with the result that too little has to be spread too thinly on promoting a wide range of potential sites. In short, WMDA is under-supported compared with similar organisations in other areas of the UK. A level playing field is needed.
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Another factor of considerable concern to the foreign investor is the congestion on the M.6 and M.5 motorways in the Birmingham area. The motorways block up on virtually every working day. I live perhaps a 40-minute drive from Birmingham on a good day. The journey can take me three hours; that is ridiculous. Companies need first class road communications, especially since many manufacturers these days use the "just in time" method for acquiring components. Those traffic problems have to he alleviated. The cost to industry is enormous. We need the Birmingham northern relief road as a matter of some urgency.
The planning process has to be improved. The time it takes to achieve planning consents is often unacceptable, and the bureaucracy involved far too great. I am aware of a number of instances where a foreign investor has been put off coming to our region because of major delays and obstacles in planning terms. This causes frustration and considerable cost to developers. As a consequence the opportunity to create jobs and strengthen the local economy is passed by. That is not good enough.
The future success of the region in attracting inward investment depends, first, on an improved and improving product to sell, greater financial and non-financial support from both regional, public and private sector supporters, the development of a regional profile, an identity to match that of the North East, and a reduction in the fragmentation and duplication of business support organisations which so often confuse investor companies.
5.35 p.m.
Lord Hughes: My Lords, there is time to spare since previous speakers have not used all the allocated time. I intervene because of the speech by the noble Lord, Lord Laing. I have spoken to the noble Lord to let him know that I would refer to what he said. I was glad that I did so because I discovered two factors. First, what the noble Lord said was not a threat to close the Glasgow factory if devolution came to pass in Scotland. He told me that it had been said when he was chairman of United Biscuits. That speech was made five years ago. Therefore, the noble Lord, Lord Laing, has no knowledge of what United Biscuits would do today because he no longer has anything to do with the company. Consequently, no threat was made by the noble Lord, Lord Laing, today. I am glad that that matter has been clarified.
Secondly, I discovered that the noble Lord did not know that corporation tax would not be part of the so-called tartan tax. The authority of the assembly would be only to increase or reduce income tax by up to 3p in the pound, but corporation tax would remain the same throughout the United Kingdom. As the noble Lord, Lord Laing, knows, and as others ought to know, companies do not pay income tax. Therefore, there is no reason to fear, even if an income tax change were to come into operation, that it would affect the desire or the willingness of companies to locate in Scotland.

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My next point has nothing to do with what the noble Lord, Lord Laing, said. As I understand it, when the Scottish parliament, assembly, or whatever it is to be called, comes into existence, the power to exercise the change in income tax is most unlikely to be made during the first parliament in Scotland. My understanding is that if the members of that assembly believe it to be desirable to have a greater income at their disposal they will wait until the next election and seek a mandate from the people of Scotland either to have higher tax and better services, or for the tax to remain unchanged. That is the main reason for my intervention.
Perhaps I may now refer to the speeches of the noble Baroness, Lady Seccombe, and the noble Lord, Lord Goold. The noble Lord did not go so far as the noble Baroness, Lady Seccombe, who seemed to indicate that it was very unlikely that companies from abroad would locate in Scotland if there were a Scottish assembly. I was a Minister in the Scottish Office for seven years. I was chairman of Glenrothes Development Corporation for three years before I became a Minister. I was chairman of East Kilbride Development Corporation after I ceased to be a Minister. I know what happened to investment in Scotland during those years. There is no reason to fear that another Labour Government would have any less success in attracting investment in Scotland than previous Labour Governments.
The point made by the noble Lord, Lord Goold, was slightly different. He mentioned investment in Scotland from abroad, especially during the past 10 years. Has he any reason to believe that it has been any better over the past 10 years than during the previous 10 years? Has he any reason to believe that it was any better than what happened under Labour Governments? I do not believe that the people of Scotland have anything to fear in relation to the location of industry from anything that may be done by a Scottish parliament.
I am in no better position to predict what will happen in the future than anyone else. The noble Baroness, Lady Seccombe, indicated what might happen in Scotland if there were a Labour Government but she is in no better position than I to make forecasts.
5.40 p.m.
Lord Ezra: My Lords, the noble Viscount, Lord Oxfuird, must be pleased at the wide-ranging nature of the speeches which have emerged during the course of the debate. Like some other noble Lords, I wish to declare an interest: I am chairman of a company which is a subsidiary of a large French group in the environmental services sector. It has given me the opportunity of understanding inward investment at first hand. I shall come back to that in a moment.
There is no doubt that the inward investment development has been on a large scale and has generally been very successful. The latest report of the Invest in Britain Bureau indicated that by the end of 1994 no less than £131 billion had been invested in Britain by overseas companies. Twenty four per cent. of net output was represented by that investment, 32 per cent. of
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manufacturing investment and no less than 40 per cent. of manufacturing exports. Those are remarkable figures which show great success in mounting the campaign.
I wish to he assured that we are receiving all the benefit we can out of that massive investment. I was pleased to note from the speech of the noble Lord, Lord Lyell, that the companies with which he was familiar were doing development work over here. There was a fear that when the large Japanese motor companies first established themselves in Britain all the development work would be done in Japan and we would simply become a nation of assemblers. I believe that that is not so, a great deal of development work is being done over here.
I also wish to raise the subject of the supply chain. The very big enterprises, with their massive requirement for components and services, present us with a potential double benefit. Not only do we receive the benefit of the direct investment and direct employment, but also there is the benefit that we can derive from supplying the services and components that are required on a competitive basis. I hope that we can be reassured that the Invest in Britain Bureau does not lose sight of the companies that it attracts to Britain once it has taken its decision and that it follows through with after-care service to ensure that we receive the best benefit.
Another form of benefit which I believe we should derive was referred to by the noble Lord, Lord Desai. He said that we could benefit from other management styles. Particularly in the case of the Asian countries that invest here, and in France and Germany, companies tend noticeably to take a longer-term, more strategic view of investment than we do in this country. We have much to gain from their management approach.
Here I wish to refer to my own experience. The company of which I am now chairman was at one time a medium-sized publicly quoted company in the sector of energy management. One of our shareholders was a French company which was eventually taken over by a larger French company, the Compagnie Générale des Eaux. In due course it made an approach to us to acquire my company. That was done on an agreed basis. At the time of the acquisition, the company for which I was responsible employed some 650 people and had a turnover of about £50 million. That was in 1986. This year, the group which has been based on that initial acquisition has a turnover of £1,500 million and it employs 20,000 people. That is a vast increase which shows the initiative that has been taken.
From the change in ownership I noticed immediately the impact of the company's long-term strategic thinking. As chairman of a minor publicly quoted company, I found that we were hounded from pillar to post by the analysts who forced us to have regard to only one thing: the dividend. All other longer-term aspirations took secondary place. As soon as we were acquired by the larger group, long-term thinking came into the picture. I can give an illustration of that not far from here. The company which I still chair was responsible for the building of one of the largest enterprises for converting waste to energy, the SELCHP plant near Deptford. Some of your Lordships may have

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visited it. The plant depends upon a steady supply of waste material and it was built to take 400,000 tonnes of waste material. It cost £100 million to build.
At the time that the decision was taken to go ahead with the project, we did not have all the waste material under contract and we took a risk; we thought that it would come in due course. The plant was built to the best specifications to conform to all the regulations from Brussels and Britain. That plant has been held up as being the most efficient and up to date in its sector. I give that as an illustration of the thinking that lies behind the actions of investors who take a longer term view.
Sometime before the French interest was shown in my company, I approached a few large British companies. I had come to the conclusion that the future for that medium-sized company, which I considered was in a growth market, could only be assured if we had a large partner. I regret that I found no interest at all. It was felt that the growth prospects were either non-existent or too small to worry about.
That leads to the next point I wish to make which concerns the anxiety expressed by the noble Lord, Lord Borne, in his excellent maiden speech. I am glad to see him among us. He is a friend of long standing and we have done much work together. The point was also mentioned by my noble friend Lord Wallace and the noble Lords, Lord Laing of Dunphail, Lord Haskel and Lord Wade. While appreciating the level of inward investment, they all expressed concern about the smaller level in relative terms of indigenous investment. If we compare the performance in indigenous investment in Britain with that of other OECD countries, we find that they are investing at a level of 22 per cent. of GNP per annum and we are investing at a level of 16.5 per cent. That is noticeably less.
I find it surprising that, having created a climate in which Britain proves attractive to foreign investors, that same climate and those same factors—flexible labour market, efficiency, lack of regulation, the large market in the UK, and the even larger market at our doorstep in Europe—apparently do not have the same impact on firms already established in Britain. The level of investment brought in is more than counterbalanced by the level of investment outside, particularly in the United States. Whereas other countries come to the United Kingdom to be near the European market, we appear to be moving further afield into the United States. That requires a bit of looking into.
I should have thought that in the long-term strategy for this country we ought to find out why it is that the factors that attract others apparently do not sufficiently attract our own indigenous industry. The Invest in Britain Bureau does not suggest by its name that it is meant only to attract investors from overseas, although that is what it does. I suggest to the Minister that perhaps it should devote part of its attention to stimulating more indigenous investment. Not only overseas investment, but indigenous investment and a better balance between the two, seems to be what is required.
5.50 p.m.
Lord Peston: My Lords, I, too wish to congratulate the noble Viscount, Lord Oxfuird, on prompting this interesting debate with so excellent a collection of speakers. I also wish to congratulate my noble friend Lord Borrie on his maiden speech. It was first-class. I echo the words of the noble Baroness, Lady Seccombe (it is about the only remark she made with which I agree) in looking forward to hearing my noble friend speak again—if only to take some of the burdens off me in all the various matters that I seem to have to deal with all the time!
I regard myself as an internationalist and a believer in free trade. I do not want to stop foreigners investing here, just as I do not wish to see foreigners preventing our people from investing abroad. Those who favour placing barriers to trade and to international capital movements (if there are any left in our country) are really announcing to the world that in a fair economic competition we cannot win. That is certainly not my view. To the question that the noble Viscount, Lord Oxfuird, puts before us—namely, whether inward investment is a good thing for this country—broadly speaking, taking the pluses and minuses into account, my answer is unequivocally yes. If that were all there was to it, this debate could have ended more or less a moment or two after it began. However, there are some sub-texts, some underlying themes, which have to do with the economic performance of this Government. I have a slight sense that some bits of politics have found their way into this debate in one way or another; I therefore feel an obligation to join in on one or two of those matters.
To get down to some serious economics, let us start with precisely the point made by the noble Lord, Lord Ezra, which I regard as fundamental. If the United Kingdom is such a good location for economic activity, and if it attracts foreign-owned multinationals, why do those same forces, whatever they are, not attract our own firms? There seems to be a paradox. The UK is attractive to foreigners for the production of, for example, motor vehicles, various forms of consumer electronics, semi-conductors and computers. But why is it not attractive to our own businessmen? One could give many examples. To take just one, in the field of non-defence electronics, there is no major UK-owned company left.
I agree with my noble friend Lord Desai that we must take a global view (to use the current buzzword) and in a sense argue that it does not matter who owns what. Certainly I agree that workers in this country require investment, and they do not in any way worry about ownership. What they want is jobs, high productivity and good pay. But the fact remains. Certainly, wearing my economics hat, I do not understand why the position is as it is. To put it in another way, which I find extremely intriguing, direct foreign investment here is largely in manufacturing. That is not entirely the case, as was pointed out, but it is to a very considerable extent.
We invest a great deal ourselves. A great deal of direct investment goes out from this country, as the noble Lord, Lord Ezra, and others pointed out—hut

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again, interestingly, not in manufacturing. It is typically in hotels, retail trading, insurance and all that sort of thing. It is also, as was pointed out, much more typically in the US than in the European Union. I do not have an answer to the question. I am certainly not in this sense pointing a finger at the Government. I really should like to know why, somehow, we are not good at things which I see no reason why we should not be good at.
The reason given in the textbooks as to why foreigners come here and are successful is that they have skills, especially managerial skills, and intellectual property that we do not possess. If that is true, it is a terrible reflection on our own people. I can only say that I hope it is not true. Looking at the issue that way, the facts are disturbing.
There is a related fact, to which the noble Lord, Lord Laing, first referred. I entirely agree with the noble Baroness, Lady Seccombe, that we must not forget the past. I am about to quote the past in some detail. Let us start in 1979, when a cataclysmic event occurred; namely, a change of government. Comparing the ratio of private investment (gross domestic fixed capital formation) to GDP with that of the present day, bearing in mind the enormous expansion of the private sector as a result of privatisation, we find virtually no change. If we then add to that the large proportion of investment undertaken by foreigners through direct inward investment, the reflection cast on the propensity of our own entrepreneurs to take risks is appalling. Since they tell us that on the whole they favour the Conservative Government, one wonders what they would do under a government that they did not favour in terms of having confidence in their own country.
To be slightly acerbic, I love Scotland and I thought the Scots loved Scotland. The thought that all the Scots will abandon Scotland simply as a result of 3p. on the rate of income tax is not an entirely convincing argument. I just do not believe it. They might follow Dr. Johnson's advice in terms of the high road to England, but for quite different reasons. Everyone argues about that, and we ought to have a debate on it at some time. I cannot believe that the Scots will abandon the country they love simply as a result of a couple of pennies on the rate of direct taxation.
I also offer a word of apology. A number of noble Lords made remarks with which I totally disagree, but I shall not have time to attack them. I hope that they do not regard that as a discourtesy on my part. I am not short of comments and there will be other occasions on which I shall make them, but I want to stick to the time limits of the debate. Since, as the noble Baroness, Lady Seccombe, suggested, this matter is to be viewed in a historical perspective, I shall quote just a few figures. From 1979 to 1994 our gross domestic product rose by one-third (about 31 per cent.). Those were the good days. In the bad old days, 1964 to 1979 (the previous 15 years), gross domestic product rose by 43 per cent. So I am happy to remember the past.
A more significant point that intrigues me (I have paid tribute to this before) is that manufacturing productivity has risen very distinctly since this Government came to power. There can be no doubt
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about that at all. I regard it as about the one achievement in economic terms of the Conservative Government. But a couple of paradoxes still remain in that connection. Despite the very considerable change in manufacturing productivity, manufacturing output from 1979 to 1994 rose by only 8 per cent.; whereas in the bad old days, as I keep repeating, from 1964 to 1979, it rose by over 25 per cent.
That certainly requires an explanation. How can we be improving our efficiency and yet not finding it profitable to sell more? How can we have moved from a surplus on the balance of trade, generally and in manufacturing, to a deficit? I do not know the answers to those questions. Again, I am not trying to make a political point; I am simply asking the Government not to make political points on areas which are—if I may be a bit snooty—perhaps slightly more complicated in terms of economic analysis than is sometimes appreciated.
The noble Lord, Lord Wallace, raised two questions. He uttered some fears in regard to foreign ownership. I am not sure that I agree with him in that regard. It is one of the things about which the Americans and the Canadians have argued, but on the whole is not the case.
The noble Lord, Lord Lyell, mentioned pharmaceuticals and I should perhaps declare an interest as chairman of the Office of Health Economics. The pharmaceutical industry, which is multinational in both directions, engages in an enormous amount of research in our country. As I understand it, the Japanese motor car firms are themselves engaging in research and development also. Therefore we do not need to have the fears that, say, the Canadians had about the Americans.
That is also beginning to be true—I should welcome the Minister's comments on this point—in regard to management. I know one or two American-owned firms in which the domestic management cannot rise above a given level. But, as I understand it, that is ceasing to be the case. I believe that in the Japanese-owned firms—and, for all I know, in the German-owned firms as well, though I am less well informed on that—there would not be a discrimination against our best people rising to managerial top positions. That would be important; it would have political ramifications and it would worry me.
I have not touched on the questions posed by the noble Viscount, Lord Waverley, and the noble Baroness, Lady Seccombe, and perhaps also those put by the noble Lord, Lord Goold, in relation to social chapters and minimum wages. It is about time we had a debate on those matters so that they can be brought out into the open; we can put our arguments forward and I can at least say where my side stands.
I ask noble Lords to reflect. Under the current Government, a few years ago unemployment rose to 13 per cent. But there was no increase in social welfare costs taking place at that time. As far as I am aware, there has been no great increase in social welfare costs recently in France and Germany to cause their rise in unemployment. Our unemployment figures fell and then rose again, but that had no connection with the points raised by those who object to the social chapter. The

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social chapter cannot yet have come to bite. Most of the relevant matters are not yet in action. Therefore, before coming to any definite conclusions, one ought to pause.
Finally, before sitting down I shall make a nasty remark about the DTI. It has allegedly done some research into the effects of a minimum wage, which the noble Baroness, Lady Seccombe, quoted. My view is that if that is the department's idea of research, goodness help us. Logically, if we have a minimum wage and all other wages rise pari passu, we do not have a minimum wage; we have a general wage increase. Other things being equal, if nominal demand is constant and we have a general wage increase, it will be deleterious to the economy.
If the DTI wishes to do some research—I am available at my normal extremely high consultancy fee—I shall explain how to do it. The department has not yet read the available literature (summarised in a number of easily accessible US journals), but it will discover that the matter is infinitely more complex and, to quote myself from a few weeks ago, one cannot demonstrate that a minimum wage leads to unemployment. That cannot be done on the empirical evidence and for that matter it cannot be done on the theoretical evidence. But that is a subject to which I should like to return. What I most look forward to, as always, is listening to the Minister.
6.4 p.m.
The Minister of State, Department of Trade and Industry (Lord Fraser of Carmyllie): My Lords, like all those who have engaged in this debate, I too welcome the opportunity provided by my noble friend Lord Oxfuird to debate inward investment and I join in the widespread remarks of congratulation extended to the noble Lord, Lord Borrie, on his maiden speech. We are delighted to hear his contribution and look forward to those he will make in the future.
Inward investment is one of this Government's and this country's greatest success stories. At one point during the debate there was a slightly querulous questioning of the desirability of inward investment. I am delighted that the noble Lords, Lord St. John of Bletso, Lord Desai and, latterly, Lord Ezra and Lord Peston, made it clear that they recognise that it is a valuable contribution to our economy.
The competitiveness of our economy is nowhere better demonstrated than in our ability to attract inward investment. Over 40 per cent. of all US, Canadian and Japanese investment, together with over 50 per cent. of Korean and over 55 per cent. of Taiwanese investment in the European Union comes to the United Kingdom. Our stock of inward investment is now £147 billion, up from £44 billion in 1985. Ninety-nine of the Fortune top 100 companies have chosen to locate in the United Kingdom. Our record in attracting inward investment within the EU is second to none and there is an encouraging, freshening trend to the United Kingdom from within the European Union itself.
The facts speak for themselves. Since 1979 the Invest in Britain Bureau has registered more than 4,200 inward investment projects with more than 700,000 associated
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jobs. In recent months we have secured investments from Ford, Siemens, Nissan, Fujitsu and Chungwa. That equals over 11,200 jobs. In the past financial year alone we won some 454 inward investment projects supporting some 91,000 jobs. Those are jobs for tomorrow's industries—highly skilled and bringing the best management standards without any bamboo ceiling or whatever it might be. The noble Lord will be pleased to hear that the managing director of Samsung is a Scot and the managing director of Nissan is also British.
Those inward investments also have the exciting potential on which the noble Lord, Lord Ezra, clearly focused. There is a potential to move down the supply chain of industry. I am only sorry to have to say that there is an extremely interesting announcement on such a project which I hope will come forward within the next 48 hours—unfortunately, 48 hours too late for my purposes, but nevertheless very welcome.
Those who invest in our country from abroad add significant strength to our industrial economy. Overseas-owned manufacturers provide one-third of all manufacturing investment; nearly one-fifth of manufacturing employment; over one-fifth of manufacturing output and around two-fifths of UK-manufactured exports—a point made by my noble friend Lady Seccombe. We are determined to maintain that enviable record. We must remain competitive if we are to continue to attract investment.
The noble Lord, Lord Borrie, advised us in some respects to be wary. If the type of inward investment we were attracting was the screw-driver assembly plant type, then I could understand his misgivings. But there has been what I see as a fundamental change not only in the quality of the job, but also in the research and development that comes with them. Samsung and Siemens are classic examples of that. It is interesting that Samsung not only brought its plant to the United Kingdom, but also intends to provide up to 500 jobs in the City of London by the year 2000, their European regional headquarters being sited here.
Britain has many attractions for the inward investor. It has a strong economy; a pro-business environment and the English language, which my noble friend Lord Geddes referred to. We have no foreign exchange controls nor restrictions on sending profits abroad. Britain offers the best available combination of a skilled and flexible workforce, low taxes and lower production costs. To pick up a point made by the noble Lord, Lord Cuckney, we now have a stable regulatory regime. It can only be tested in this way. When I have taken trade missions abroad, seeking investment in other countries, the keenest disincentive in those countries is that there is a regulatory regime that is unstable or too heavy.
Another attractive feature of the United Kingdom is its valuable research and university base. No doubt that is worthwhile. The noble Lord may be interested to know that there are now over 50 science parks which create an ideal environment in which companies can develop links with researchers. I believe that the list of inward investment successes is a testimony to the excellent and continuing work of the Invest In Britain Bureau and, I hope increasingly, Business Links. Every

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effort is made to ensure that the process of setting up in the United Kingdom is as easy as possible and that investors have quick access to the best advice. I also pay tribute to the work of the Foreign and Commonwealth Office, not only for their promotional work in relation to inward investment but also in relation to exports. I am grateful to the noble Lord, Lord Rathcavan, for his kind remarks about the Northern Ireland Office. Some 4,000 jobs have been created as a result of inward investment since the ceasefire. That is extremely desirable. Clearly, we are keen to see that figure rise even further.
The noble Lords, Lord St. John of Bletso, and my noble friend Lord Cuckney asked what was being done to promote London as a financial services centre. Clearly, that is equally important in terms of inward investment. There is now a new City Promotional Panel to promote our service industries, and clearly London is the jewel in the crown. That panel is an important step forward in co-ordinating the promotion of financial services and the attractions of the City of London in particular. The city's attractions as a European financial and headquarters centre are marketed actively not only by Invest in Britain but by London First Centre and the Corporation of London.
We do not stand alone in the world looking for inward investment. It is now a global activity. Increasingly, we live in an open, global marketplace. Attitudes to overseas investment throughout the world have undergone a dramatic change. Where it was once regarded with suspicion, it is now eagerly sought. I do not believe that we should resist it. The noble Lords, Lord Borrie and Lord Wallace, were concerned that we might disappear under foreign ownership. In 1994 cross-border acquisitions made by United Kingdom firms overseas amounted to over £15 billion. At the same time, acquisitions made by overseas firms in the United Kingdom were valued at just over £5 billion; in other words, our acquisitions were about three times as large as those who invested here.
The noble Lord, Lord Haskel, highlighted that there had been a fall in inward investment recently. In that he is technically correct. The figures for inward investment flows in 1994 were lower than those for 1993. However, this was due mainly to a fall in the flow from the United States. The total United States outward investment fell by about a third in that year. Notwithstanding that fall, we still enjoy about two fifths of the Untied States inward investment to Europe and about one-sixth of US investment in global terms.
Concern was expressed that there might be a degree of safeguarding of the ownership in the manufacturing sector. The noble Lord, Lord Peston, indicated that he did not regard that to be important. I share that view. Fascinatingly, last week when motor sports were discussed, it became quite clear exactly what was being invested in here by a most extraordinary range of companies from around the world. I would have thought that Ford was regarded by many people in this country as a British company. Not only do people work in it now but their fathers and grandfathers may also have worked for that company. I do not believe that ownership is that important a feature.
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The noble Lord, Lord Astor, raised the specific point about Jaguar. We are fully aware of the position on the X200 project. We continue to have a close and, I trust, positive dialogue with the Commission, and we have provided it with extensive information to enable it to evaluate that project. I assure the noble Lord that Her Majesty's Government is determined to keep Jaguar within the United Kingdom.
There has not been over a period of change, as some have feared, any significant degree of disinvestment in the United Kingdom by investing companies. There are signs that existing US investors are reviewing their pan-European operations in order that they remain ahead of their competitors. As one may expect, there is a standard form of rationalisation, but we appear to be doing very well. The noble Lord, Lord Ezra, picked up a point very much at the centre of the Invest in Britain Bureau's present strategy, that we should emphasise the role of aftercare. It should be made known to those who have already come here as inward investors how welcome they are. I believe that the best proof of the success of that approach is the recent major expansion that Fujitsu have announced.
Bedevilling discussions about inward investment is the issue whether or not we have attracted investment here because labour costs are lower than elsewhere in Europe or the world. The Government do not associate themselves with any notion that the case for inward investment depends upon the concept of a low-wage economy. We are concerned to ensure that labour unit costs are low. They are probably about 60 per cent. of German labour unit costs. In that context, what is of interest is that the take-home pay of someone who works in the car industry for a company owned by a German company is probably 80 per cent. of the take-home pay of a worker in Germany, whereas the cost of living here is significantly lower. For example, in terms of real take-home pay a single person in the United Kingdom is second only to Luxembourg in terms of the European Union.
I stress that the issue of wages does not seem to he the most direct point in terms of attraction. While it is important that labour unit costs should be low, actual wages are not that important. I believe that it is the experience of anyone who has had contact with inward investors that the general pattern is that they pay at, or in many cases above, the going rate. What concerns them are the broader social costs.
Concern was expressed by both the noble Lord, Lord Laing, and Lord Wallace, that inward investors received more favourable assistance than indigenous investors. Regional selective assistance operates under the same rules and regulations both for indigenous and foreign companies to set up, expand or safeguard managing facilities, resulting in a net creation or safeguarding of jobs in United Kingdom assisted areas. Both noble Lords may be interested to know that some 60 per cent. of RSA goes to United Kingdom companies and only 40 per cent. to foreign investors.
My noble friends Lord Wade and Lord Shrewsbury were concerned that some areas of the country might not secure the same level of support as others. It is our

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view that we cannot promote individual locations or regions to foreign investors, since decisions on the location of investment are for the commercial judgment of the companies themselves. However, in 1995–96 the IBB made grants totalling approximately £8.8 million towards the funding of the inward investment activities of the English regional development organisations and similar activities in the east and south-east regions. That is an increase of 57 per cent. compared with 1993–94.
There may be arguments about the levels of incentives or the areas in which they are made available, but there are certainly incentives in place. What I would clearly wish to avoid is that there should be any disincentive to investment. I would be particularly concerned were there to be any disincentive north of the Border. That theme was taken up, first, by my noble friend Lord Oxfuird, and then by the noble Lords, Lord Laing and Lord Goold. I heard very clearly what the noble Lord, Lord Laing, had to say but I think it is worth appreciating that even if corporation tax were not payable by a Scottish company to a Scottish Assembly, should that folly be perpetrated on Scotland, all those who worked in Scotland within those companies might face the risk of having to pay that extra 3p in income tax, whether the managing director or someone sweeping the floors. Even if Locate in Scotland did not draw that risk to the attention of potential inward investors to the United Kingdom, I have no doubt that such a doughty fighter for his own region as my noble friend Lord Wade would make it known to them that there was that disincentive north of the Border. Being the sponsor Minister for the north-east of England, I have no doubt that those responsible for attracting inward investment there would similarly make that point. I do not believe that anyone would seriously take up the stance that extra income tax payable north of the Border would not affect the distribution of inward investment or the location of existing jobs between England and Scotland.
I leave the matter with just this observation. The noble Lord did not care for what he described as the "threat" of the noble Lord, Lord Laing, which I certainly did not understand it to be. But when he promised that the next Labour Government would be as good as the last Labour Government, I regarded that as being the one threat that has truly been issued during the course of the debate this evening.
Another area which threatens a serious level of disincentive with regard to inward investment is that of the social chapter. What we have to remember is that the United Kingdom is not only competing for inward investment and trade with other European countries but we are also competing with other countries in eastern Europe which are not members of the European Union and indeed with the United States, where statutory regulations on employer-employee relations are relatively limited.
I hasten immediately to say to the noble Lord that I shall not engage in discussion on the minimum wage. For what concerns me most about the impact of the social chapter is that if we were to lose our flexibility of hours, including shift working, there would be a serious risk of losing inward investment. If we were to accept restrictions on hours being worked, I have no
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doubt that the keen competitive edge that we have at the moment and which, if I may remind noble Lords, has been remarked on by the former President of the European Commission, would be lost. He accepted that Britain would remain a paradise for inward investment so long as we kept our position outside of the social chapter. All those parts of the package are more significant than even the minimum wage.
Inward investment is all about partnership. At one time I was asked to be clear that it was not just success of the Invest in Britain Bureau that brought this all about. I am ready enough to acknowledge that. It is a partnership of national, regional and local organisations, Business Links and the like. I know from my experience in the north-east of England that that has certainly come into place. Siemens is a brilliant example. It took a decision to invest in the United Kingdom in late July. By a skilful partnership in the north-east of England, it was possible to cut the sod, with all permissions granted, by the beginning of December. I do not believe that a comparable pattern could have been achieved anywhere else within Europe. That is clearly important and I am glad to pay that tribute to the partnership that brought it about.
I intended to conclude with a series of quotable quotations from foreign investors around the world. I shall restrict myself to just two. First, the chairman of BMW recently said:
"Structural change has made Britain by far the most attractive place to invest in Europe".
Perhaps I may say to my noble friend Lord Lyell, given his keen interest in the pharmaceutical industry, that the chairman and chief executive of the pharmaceutical company Upjohn had this to say:
"London is the centre of the globe in terms of the pharmaceutical industry".
The United Kingdom has been voted the world's most popular destination for foreign direct investment, ahead even in 1996 of China. A survey by Corporate Location showed that the United Kingdom was being considered by 27 per cent. of foreign investors for projects within the next three years. In citing these figures, I hope your Lordships do not believe that the Government are complacent. Far from it. As we have achieved this position of primacy, our task must be to ensure that we do not lose it.
6.25 p.m.
The Viscount of Oxfuird: My Lords, I am very, very pleased and honoured to have been able to facilitate this debate. I genuinely believe that the skill, experience and dignity with which this subject has been treated demand that Hansard of your Lordships' House should be available on every news-stand in the country. But unfortunately we cannot afford to do that. I thank all those who have participated in the debate. I beg leave to withdraw my Motion.
Motion for Papers, by leave, withdrawn.

Edinburgh Assay Office Order Confirmation Bill
Brought from the Commons, read a first time, and (pursuant to the Private Legislation Procedure (Scotland) Act 1936), deemed to have been read a second time and reported from the Committee.
Edinburgh Assay Office Order Confirmation Bill

  The Welsh Economy
  6.27 p.m.
  Viscount St. Davids Viscount St. Davids rose to call attention to the economy in Wales; and to move for Papers.
  The noble Viscount said: My Lords, the last opportunity we had to debate the economy in Wales was 29th January 1992, at col. 1311 of Hansard. It is unfortunate that tonight's debate is without knowledge of the contents of the rural White Paper which will be published early in February.
  During the past four years your Lordships have passed three Acts specific to Wales and two education Acts containing special provisions for Welsh education. All these Acts have an economic impact on Wales. The situation is not unlike a nest of Russian dolls, the Welsh economy being the smallest, contained inside the UK economy which itself lies within the European economy, which in turn lies within the world economy. In the past, when our economy was overwhelmed by the colliery face and steel plants, the world sneezed and Wales caught pneumonia.
  Wales entered the recession ahead of the United Kingdom and came out earlier. The index of industrial production for Wales now stands at a higher figure than that for the UK, having passed that point during 1994. Manufacturing as a percentage of GDP, at more than 27 per cent., is significantly higher than the 21.6 per cent. for the United Kingdom as a whole and compares very favourably with the best regions of England. Unemployment, historically higher in percentage terms than in the UK as a whole, started the recession at a higher level but now, at 8.2 per cent., is within 0.2 per cent. of the UK figure.
  Surveys published this month by the CBI and Dun & Bradstreet show Wales to be the most optimistic region of Great Britain. Nearly 80 per cent. of Welsh firms expect to increase sales, 70 per cent. to increase their exports, and 66 per cent. to increase employment. Welsh manufacturers continue to plan high levels of investment in training and innovation and a moderate increase in investment in plant and machinery. Wales is the only part of the United Kingdom in which manufacturing employment has increased in the past decade. There has been a slow narrowing of the gap in average earnings, which in Wales now stand at 90 per cent. of the UK figure.
  There has been a second industrial revolution in Wales. That can be attributed to successive governments. The statistics do not reveal the true picture for the whole of Wales. It would be a golden age if they did. The second revolution relates not only to assets but also locality. It is mainly confined to the area known as
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  the M.4 corridor. The statistics would look even better if they were not diluted by lack of economic progress elsewhere in the Principality.
  Unemployment in Newtown in December 1995 was below 3 per cent., in south Pembrokeshire over 13 per cent. An article in the Western Mail last week mentioned unemployment rates of over 20 per cent. in some areas. We know that Wales has an exceptional inward investment record. We have consistently attracted up to 20 per cent. of all inward investment recorded for the United Kingdom despite having only about 5 per cent. of the population. Overseas-owned manufacturing companies employ over 70,000 people—31 per cent. of the total number of manufacturing jobs in Wales. Why do they come to Wales? How do we ensure that they continue to come—not only overseas companies but also companies from elsewhere in the United Kingdom—and enable skilled Welshmen to stay at home?
  The main attractions of Wales lie in its quality of life, its telecommunications infrastructure, its inward investment promotion policy and the availability of suitable sites, premises and housing. To that we must add the fact that manufacturing productivity in Wales is the third highest of all UK regions and, on the latest figures, 3.2 per cent. above the UK average. Let us not forget the high quality of Welsh education, a subject to which I shall return.
  The Welsh Office and the Welsh Development Agency are not the only agents at work securing inward investment. We must also recognise the important part played by local authorities, many of which have built up a considerable expertise. We must ensure that this expertise is safeguarded during the process of local government reorganisation. It is far too early to know what will be the effect on the Welsh economy of the proposed changes.
  This year is the 20th anniversary of the Welsh Development Agency, created when the right honourable gentleman Mr. John Morris was Secretary of State. Many functions were brought into being by the noble Lord, Lord Cledwyn of Penrhos, and subsequent Secretaries of State. The invaluable contribution that the Welsh Development agency has made to the economic prosperity of Wales is well known. The agency will have removed all major industrial blight and dereliction by the year 2000, a very remarkable achievement. The noble Lord, Lord Cledwyn, who has done so much for the cultural and economic prosperity of our country, can be proud of his brainchild. It has taken the Welsh economy from the 19th century, through the 20th and prepared it for the 21st century.
  The agency has decided to adjust its programmes to take account of both slower than expected progress in some schemes and lower than anticipated receipts this financial year. However, contractual commitments will be honoured and no projects lost. The agency is expecting to exceed its target for inward investment at 10,000 created, or safeguarded, jobs of which about 8,000 have been secured. That is 60 per cent. up on a year ago. The 1996–97 budget will allow the agency to increase grant-in-aid by 58 per cent. to reflect its

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  priorities and the work that it has to do. That will enable the agency to fund gross programmes of a size similar to those of this year at around £130 million.
  The Cardiff Bay Development Corporation, another important engine of economic growth, is still expected to meet its key lifetime target of providing of over 25,000 jobs, 6,000 homes and the attraction of about £1.5 billion of private sector investment, of which £350 million has already been achieved.
  Tourism is not an area in which I lay claim to any particular knowledge other than that I live in an area of Wales which could not exist without it. The tourist industry contributes about £1.3 billion to the Welsh economy, being about 5.5 per cent. of the Welsh GDP. It employs 9 per cent. of the labour force and provides about 95,000 jobs. But its contribution to the economy is out of all proportion to these numbers as it brings prosperity to areas far from the M.4 corridor.
  I pray that I am not being over-harsh when I suggest that if tourism in Wales is to play a more prominent part in the growth of the Welsh economy it must trade up. There are too few quality hotels and many of our resorts give the appearance of living in the immediate post-war period when the competition was a holiday camp. With its short summer season and uncertain weather, it is to the growing wealth of the older generation that Welsh tourism must look. There may be a market to capture as medical opinion raises concern over excess exposure to the sun—not a Welsh problem! But that will also require a fresh look at the accommodation and other amenities being offered. The sunny southern regions of Europe will not part with their tourist trade willingly.
  The short-term cottage rental sector maintains a high standard, policed by standards set by the letting agents, the Welsh Tourist Board and competition from other cottages in the neighbourhood. The tourist board does a first-class job, but in many areas of Wales further gains will depend upon a reappraisal of what is being offered and major investment in upgrading.
  Education is all-important to economic success. The Welsh have always known that the route to the classless society is through the classroom. They have always known that the ladder that extends from poverty to personal fulfilment is the ladder of educational achievement. That is why the culture that pertains to education in Wales differs so widely from the culture that pertains in England. I believe that this cultural difference is little understood in Whitehall.
  I do not intend to set up an educational polemic to tilt at. Tall I may be, but Don Quixote I am not! I believe that local authorities have sufficient resources available to ensure that their schools are adequately funded. The number of young people entering higher education, at 30 per cent., has more than doubled enrolment at higher education institutions other than the University of Wales. Enrolment at the University of Wales has increased by 70 per cent. since 1980 despite the fact that many Welsh students seek their education elsewhere in the United Kingdom.
  I express considerable concern that Welsh language education is little understood outside Wales. I have heard of cases of entrepreneurial talent being deterred in Wales by misunderstanding. If education is a cornerstone of economic success, then so is social cohesion. A people divided against themselves will not succeed. Most of Wales is a long way from London and even further from Brussels. National identity is a protection against a feeling of isolation by the individual. Language is a part of national identity. The Welsh Language Act—its birthplace was your Lordships' House—has a key role to play in Welsh culture. But it must be used sensibly, as an agent of cohesion, not of division.
  Each locality will have a local innovative job creation scheme of note. This evening I draw attention to just such a scheme. Mr. Danny Fellows, district secretary for Wales of the TGWU, has started a lottery, licensed by the local authority, which can raise up to £10,000 a week. It offers prizes of £2,000 a week. The profit is devoted to the financing of small businesses.
  Small business projects are selected by a committee drawn from the local business community. The scheme is promoted by local banks which may well contribute capital, adding gearing to the number of jobs created. The lottery is creating jobs at the rate of 200 per year, a number expected to rise to 400 as it becomes better known. Mr. Fellows's scheme shows that "good causes" are not necessarily the "best causes". If such a scheme was copied by all local authorities in Wales, the resulting job creation would be enormous.
  I had high hopes of the West Wales task force when it was announced by my right honourable friend Mr. David Hunt. Unfortunately, its inception caught the downturn in government spending and it is unfunded.
  The geography of Wales does not allow for easy north-south communication. Road projects must remain a high priority if the whole of Wales is to take part in growth similar to that achieved in the M.4 corridor. Local innovation cannot overcome bad communications.
  In the time allowed, I can raise only a few of what appear to me to be important issues. The economic success of the south must now be matched by equal success in rural and coastal areas. Let us hope that the rural White Paper will sow the seeds of that success. I beg to move for Papers.
  6.42 p.m.
  Baroness White: My Lords, we should all appreciate the speech made by the noble Viscount, Lord St. Davids, although he used the word "economy" in a wider sense than I had supposed that he would. Earlier this afternoon I listened to a number of the speeches in the previous debate on inward investment into the UK, including the excellent speech of the noble Lord, Lord Borrie. I could not help wondering whether it was better for us to have our own separate debate on a complex subject in Wales or whether it would have been more desirable to have joined with Scotland and England in the previous debate. Having listened to the noble Viscount, I think that we are probably better off as we are with our own opportunity and our own subjects. Those of us who have

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  at heart the welfare and well being of Our native land must express our gratitude to the noble Viscount for giving us this opportunity to consider aspects of the current and prospective economic position of the Principality.
  I must confess to being slightly irritated to find that when I had gone to some considerable trouble 10 days ago to check at source the current Welsh position in the two areas about which I wish to speak, I found that one was dealt with at some length last Friday in the Financial Times and the other today in our major Welsh newspaper, the Western Mail.
  The first subject in my area of concern relates to aspects of the Welsh Regional Technology Plan which was not touched upon by the noble Viscount. I have the consultative text of the Welsh Regional Technology Plan which I will happily give him at the end of the debate.
  The other subject with which I am concerned is tourism, which the noble Viscount discussed but upon which I should like to give further detail in a moment. The RTP—everyone now calls everything by its initials—is an interesting way of discussing the problem of our culture and our financial position. It took about 18 months' discussion with 600 companies and organisations to bring about a consultative report, which was issued on 24th January, on a regional technology plan aimed at developing a much needed culture of innovation in Wales.
  The interesting point about it is that Wales is one of only eight European regions, and the first in the UK, to have been invited to devise an RTP by the European Commission which provided 200,000 ecu (£157,000) in each case to fund a pilot scheme. The prime motivation for the RTP is that investment in research and development and innovation has been shown to be a key factor behind the disparities in the prosperity of European regions. The richer regions spend six times more on that than the poorer regions such as Wales. The noble Viscount was confident about the Welsh situation, although it seemed to me that the RTP was a little less so.
  Wales appears to have the lowest level of industrial R&D investment of any mainland UK region. Compiling a report was a team effort with the WDA which matched the European funding and led the project with support from the Cardiff Business School. This is, of course, attached to the University of Wales, with which I had a good deal to do years ago when I was a university officer in Wales.
  The Welsh Office chaired a steering group drawn from industry and the public sector, including local authorities. In charge of the group, and the author of the consultative report, was Mr. Meirion Thomas, who is attached to the Business School, although he wrote the report independently. When the report was being issued last week, he said:
  "In Wales we have trouble with implementing new ideas".
  He emphasised in particular:
  "Established banks expect to have a quick return. They do not really understand innovation. They are not prepared to wait for the 10 or 15 years it takes for the return to emerge".
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  I am not well enough informed about these matters to he able to judge the validity of what he said but it sounds convincing to me. The objective of the RTP exercise is to develop a consensus among academia, the public sector and industry, on a strategy to help to improve the performance of the Welsh economy. That is an interesting way to go about such matters. The consultative report was issued last week at a seminar in Cardiff attended by nearly 300 people. It had the blessing of the Secretary of State for Wales, who was present on the video only. However, I understand that that was reasonably effective.
  The final report on the RTP is expected to be published late in March. Mr. Meirion Thomas states:
  "The exercise over the past 18 months has put Wales at the forefront of European thinking on regional development and innovation strategy".
  He suggests that companies learn best from each other. Supply chains and networks are crucial to innovation. That is easy to say, but not so easy to carry out. That is so as regards the smaller firms, which may have good ideas but lack confidence or resources, and as regards the larger, established firms which fail to realise the need for change.
  We are fortunate, therefore, that the Welsh economy has caught the attention of the resources of the European Commission as well as the Welsh Development Agency and we must wish it well. In the meantime, we can expect to face highly relevant increased competition from South-West England, following the second Severn crossing and the new West of England Development Agency. On the positive side, I believe that we have some promising developments ourselves. I am told that the new steel production facility at Llanwern may become the most advanced plant in Europe. I very much hope that that is true.
  Perhaps I may refer briefly to the other subject on which the noble Viscount, Lord St. Davids, touched; that is, tourist enterprise in Wales. It is undoubtedly one of the most important subjects. Again, I have brought with me the necessary document. I am not sure whether the noble Viscount has seen the Wales Tourist Board's magazine for 1996. It was made available last week and I should be delighted to give him another present if he does not have a copy. When we spoke about tourism in Wales a few days ago he seemed to me to be rather scathing about some aspects of it; I believe mistakenly so, because during the past 10 years the tourist industry in Wales has improved remarkably. The Wales Tourist Board's holiday magazine for 1996 is a very impressive publication. No other tourist organisation in Great Britain has or could have anything superior.
  Some of your Lordships may know that for the past 10 years or so the Wales Tourist Board has been actively run by Mr. Paul Loveluck, who has recently resigned to take over the post of Chief Executive of the Countryside Council for Wales. I know that he was most active during the 10 years that he was in charge of the Wales Tourist Board. In his farewell message to colleagues two weeks ago he wrote:
  "It has been a privilege to play a part in the development of one of Wales' most important industries and to see it done in ways which will sustain our natural environment and our cultural heritage.

  1507
  Through the partnership which has been forged between the private and public sector a great deal has been accomplished. The standard and range of facilities for our visitors has improved beyond recognition. Our professional and customer care skills have also improved. Our universities and colleges are now turning out well qualified and motivated young people anxious to join the industry".
  Mr. Loveluck then refers to the development of image building and direct marketing in the United Kingdom and to the achievement of overseas marketing powers for the Wales Tourist Board. Most noble Lords will know that the board had great difficulty in obtaining adequate arrangements for its overseas direct marketing. A national tourist information centre network of 85 centres has been set up with 55 of them now open throughout the year, compared with only two centres 10 years ago. The tourist industry in Wales has great resilience and has a capacity to play an even greater part in the programme of balanced economic growth in Wales.
  I apologise to your Lordships for speaking for too long; I did not follow the numbers on the clock. However, we have plenty of time to discuss Welsh issues and I am glad that the noble Viscount has given us this opportunity tonight.
  6.56 p.m.
  Lord Hooson: My Lords, it is always a pleasure to follow the noble Baroness, Lady White, who in a variety of guises has made such a great contribution to the life of Wales, not least to the economy of Wales. I wish to congratulate the noble Viscount, Lord St. Davids, on introducing the debate, which is so timely. I appreciate fully the thrust of his remarks, which went beyond the M.4 corridor.
  I wish to say at the outset that I completely support the remarks that will be made later by my noble friend Lord Davies on the importance of the opera house at Cardiff as an integral part of the development of the attractions of the capital city of Wales. I do not wish to duplicate his remarks, but I have been privy to correspondence and comments made by the noble Lord, Lord Crickhowell, as chairman of the Opera House Trust. My noble friend Lord Davies is co-chairman of Welsh National Opera. I completely share their exasperation at the lack of consistent approach and inadequate reasoning that so far has emerged on that subject.
  I wish to concentrate my remarks on three topics and for my sins I must make a declaration of interest in respect of each one. The first is the importance of the M.4 corridor. The prosperity of the M.4 corridor depends to a degree, and assists to an even larger degree, on the Severn crossing. I happen to be chairman of the company which is building the second river crossing and which runs the present bridge across the Severn. That development is of supreme importance to Wales. I agree that the development that has taken place along the so-called M.4 corridor is natural and inevitable.
  Years ago when I was practising at the Bar I undertook a case for the late Sir Brandon Rhys Williams. He was a far-seeing chap and perhaps a little eccentric at times. The case engendered an enormous
  1508
  amount of opposition and it concerned the land which is now the home of the Bosch factory at Miskin. A great deal of the inward investment—Bosch was only one investor—came to that corridor. It is clear that such development will flourish on each intersection that is available along the M.4 and on tributaries to and from it. That part of South Wales is going to develop apace, as is its counterpart on the other side of the Severn estuary.
  Perhaps I may give some figures about the growth in the volume of heavy goods vehicles travelling on the present Severn Bridge. Perhaps contrary to the impression which the Cardiff Business School created a little time ago the figures show—I have checked them today—that the increase between 1993 and 1994 in heavy goods vehicles using the bridge was 2.6 per cent. and that between 1994 and 1995 that figure increased by 6.3 per cent. We do not yet have the figure for 1995–96, but all the indications are that the increase will be at the same rate. That increase has gone on month by month. There has been a steady increase in the number of heavy goods vehicles using that bridge for 17 or 18 months now.
  In passing, perhaps I should mention that the bridge is a marvellous example of European co-operation and of investment on the part of the European Investment Bank, without which it could not have been built. It might be worth pointing out for the benefit of all the Euro-sceptics that the bridge is a marvellous example of British-French co-operation. If it were not for the existence of the common market and other markets in Europe, there would have been no need for a bridge. We in South Wales would have slumbered into decline at a rate that is unimaginable today. That is why I am clear about the future prosperity of that area.
  I turn secondly to the greater problem of the rural areas, which was mentioned by the noble Viscount. I should like to concentrate on Mid Wales as it is the largest of the vast rural areas in Wales. I have an interest to declare here because I happen to be chairman of Laura Ashley plc, which is a supreme example of the success of such a venture in a rural area. Although I had known that it was the largest private employer in Mid Wales, I was amazed to learn last week that Laura Ashley plc is the third largest private employer in the whole of Wales.
  It is important that we recollect that in 1962 when I became the Member of Parliament for Montgomeryshire the whole area was suffering from acute depopulation. The noble Baroness, Lady White, will well remember that. I shall not go over all the steps that were taken, or all the campaigning that was necessary, to change that trend, but I would say this—and every government should remember it—that without government investment and leadership, the rehabilitation of Mid Wales could not have taken place. Mid Wales needed pump-priming, intelligent investment, the development of its roads, and leadership from within Mid Wales, which mercifully, was present. It also needed the backing of government through the Welsh Office and the development board in its various guises. That body is now known as the Development Board for Rural Wales. That point is important.

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  The present requirements are as follows: it is important to safeguard the industries that are there. There are disadvantages to being in Mid Wales. The transport difficulties are obvious. In addition, air communication is not easy, although it is so important for larger companies which have to get their products to ports or to airfields that can take large planes. All those factors are important, as is the availability of grants for equipment. In the 1960s when such companies were developing in Mid Wales those grants were extremely important. Small business loans have also been successful there.
  However, there is also a case—I have no doubt that the Government will look at this—for allowing organisations such as the rural development board and the Land Authority for Wales to take equity in a company and to share the risk and take the benefits. There needs to be a partnership between private industry and public investment.
  The third matter that I should like to discuss is agriculture. My noble friend Lord Geraint will deal with this in more detail, but I particularly wanted to mention the research facility at Aberystwyth. I refer to the famous plant breeding station. Again, I must declare an interest because I am a farmer and was for some years a member of the governing body of the Institution for Grassland and Environmental Research. I mention that because everybody involved in agriculture knows how important that facility in Aberystwyth has been for the past 75 years, not only for Wales but for the United Kingdom and for developing countries overseas. If only one institution can claim the greatest credit for the green revolution, it is that institution under Sir George Stapleton, one of the most distinguished Englishmen ever to become a naturalised Welshman. He made a tremendous contribution.
  This year the future of that facility, like the future of IGER, will be carefully considered under the "public options" scheme. All that I ask the Government to do is to give an indication of what they think is the right road ahead and to keep that very important research capability and all the research expertise at that plant breeding station in Aberystwyth. Is it to be differently formed under IGER? Is it to be attached to the university? Whatever happens, it is vital that that capability and expertise are preserved.
  7.6 p.m.
  Lord Elis-Thomas: My Lords, as always it is a pleasure to follow the noble Lord, Lord Hooson, and to endorse what he said about European investment and rural policy. The noble Baroness, Lady White, did the House a courtesy by referring in great detail to the importance of research and development in the recent regional technology plan (RTP) of the European Union. It is perhaps the most important recent innovation in the Welsh economy and I congratulate the noble Baroness on drawing the attention of the House to that important subject. We look forward to the final stage and to the report produced by Mr. Meirion Thomas.
  The whole House is grateful to the noble Viscount, Lord St. Davids, for helping us to celebrate the 20th anniversary of the Welsh Development Agency; an
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  agency which I recollect the Conservative Party opposing at the time of its establishment, but we shall not go over that ground now. Nevertheless, it is important to celebrate such occasions and to mark the work of the agency, which has not had an altogether positive press in recent years. I deprecate the tendency of some Members of another place to talk down Wales and through some of their statements to undermine the effectiveness of our institutions when they are abroad working for the development of regional policy in Wales.
  In its 20 years of operation, the agency has spent over £1,750 million in the Welsh economy. Of that, a total investment of nearly £280 million went directly into business between 1977 and 1990. I should like to refer not only to investment in business, but to the equally important environmental investment of the agency. That is the theme that I want to pursue. I declare an interest as vice-chairman of Cynefin Environmental Limited, a small to medium-sized environmental consultancy. Between 1976 and 1995 the agency improved over 9,000 hectares of land by reclamation at an investment of nearly £300 million. That investment means that the agency is committed to greening Wales in all senses. After 20 years, it is appropriate that the agency itself should be taking stock of its contribution to the greening of Wales and realising that greening is not just about clearing dereliction, but about developing sustainable development in the broadest sense and ensuring that the quality of life in Wales is enhanced in all ways.
  I believe that in the next 20 years the environmental policy of the agency—indeed, the environmental goals of government and public sector investment—should be at the front end. Surely Wales can take the lead in that. We still have a magnificent environment. We have areas which are designated for their outstanding landscape and scientific quality. We already have a good image in terms of the quality of life in Wales.
  What we need to do is to enhance that in all possible ways. That requires a vision for the Welsh environment which I know the agency is developing in partnership with the other agencies, such as the Countryside Council for Wales and the equally important agency referred to by the noble Lord, Lord Hooson, the Development Board for Rural Wales. I very much applaud the recent decision of the board to restructure itself to meet the new requirements and "Go West" by separating its western and eastern sections. I am sure that that will bring benefit to the people in my old constituency of Meirionnydd and also to the area of Ceredigion.
  The emphasis on rural development is not the only essential emphasis in terms of environmental policy. The South Wales Valleys are a major area of environmental improvement. The agency, the countryside council, the tourist boards and the local authorities have a new vision for the valleys which is to restore its traditional landscape and to reverse the dramatic developments of the 19th century, while maintaining the very special sense of community which was created at that time.
  That enhancement is important because it would create the opportunity for people to take part in restoring their own community. Here I declare an interest as one

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  of my voluntary activities is chair of the co-ordinating committee of the "Keep Wales Tidy" campaign. We have been involved in a number of initiatives; for example, in cleaning rivers and cleaning up valley communities and, indeed, with providing people with the opportunity and skills to care for their own areas. That initiative itself is an indication of the importance of the greening of our towns and cities.
  High quality landscapes are important, but equally important, too, are the objectives of environmental policy as they apply to technological development. Here I should like to commend what the noble Baroness, Lady White, said about the importance of developing a culture of innovation through the regional technology plan. I should like to mark up one particular area where I hope that that plan and the new investment of the agency will lead; namely, in the so-called direction of ETS—to add another acronym to our debates—which stands for environmental technologies and services. Surely they are the scientific investment areas of the future.
  The current world market in the area is already worth some 250 billion dollars according to OECD estimates, and it is calculated to rise. We can set that in perspective if we look at the aerospace industry, which has an estimated value of some 180 billion dollars. Therefore, it is already a major area. The market is currently dominated by Germany, the USA and Japan. One of the important aspects of that market is the fact that not only is it an example of how investment meets environmental criteria (which is usually set by legislation of Parliaments, of the European Union and, indeed, by international regulations), but also many of the costs of environmental improvements and of achieving new standards and promoting efficiency are seen as savings when they are turned into investment in new job opportunities.
  I should like to see Wales lead as a region which has had environmental problems to deal with but which still has a fragile and very striking environment of great variation, which is still attractive to tourism, with an emphasis increasingly on green tourism. Indeed, I endorse all that the noble Baroness, Lady White, said about the sterling work of Paul Loveluck with the tourist board. We wish him well, as she did, with his new role in the countryside council. Within that context, it is possible for Wales to develop and become a market leader among European regions in the whole area of ETS. I have in mind the technologies of water and effluent treatment in which we already have a strong lead from Welsh Water (our regional water company), the areas of waste management recycling and air pollution control and, indeed, the areas of energy and urban amenities, including the restoration and development of public transport.
  We heard earlier an emphasis on the importance of road transport and road communications. I am proud of the fact that I travel between North and South Wales regularly by train and try not to drive. It is important, I believe, that I should save myself for my work of ensuring that the Welsh language becomes developed in the life of Wales and it is easier to do so using even that
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  convoluted train ride from Bangor, through the lovely Welsh borders and down to Cardiff. However, we need to improve that service. We need to improve the quality of the rolling stock and, indeed, of the timetable. But we also need to look at our inter-valley urban transport and our bus services in rural areas. We need an integrated strategy for public transport throughout Wales.
  In terms of the development of our environmental industries, we can also look at the development of environmental biotechnologies and other environmental services. If we consider that as a key area we can see that it is possible to envisage Wales as a lead area in environmental technologies and in sustainable development. But that can only be done in partnership. Moreover, it would have to be a partnership between the major agencies and the private sector; and it would also have to be a partnership with communities in Wales and in particular with our new local authorities.
  I hope that our new local authorities will be taking up the challenge of local Agenda 21 and that they will be look at sustainable development as a key activity for them within their own communities. Each community can look at what it should be doing to ensure that it is a community which is greening itself and that it becomes an attractive place for its residents and a place in which they can be proud to live, about which visitors will say, "Here is a country which is both local in its commitment to its language, culture and heritage, but which also has a global vision".
  7.16 p.m.
  Lord Aberdare: My Lords, I, too, should like to thank my noble friend Lord St. Davids for giving us the opportunity to discuss Welsh affairs. We do not have many such opportunities and this one is certainly most welcome. My particular interest lies in what were the mining valleys of South Wales, and especially in the Cynon Valley where my family had its home until recently. I listened with great interest to what the noble Lord, Lord Elis-Thomas, said about the mining valleys.
  The whole valley depended on the coal industry, and the disappearance of the collieries has caused massive unemployment. The key issue in improving conditions in the valleys, therefore, is the creation of more jobs. I listened with great interest to the end of the last debate and I certainly agree that we need much more inward investment. After all, we are not that far from the M.4 corridor.
  Much has been done—and, indeed, is still being done—to achieve that end. I should especially like to commend the Cynon Valley Business Partnership which was stimulated and is run by Mr. Alun Davies. The partnership involves local businessmen with statutory bodies in the task of bringing new jobs to the area—just, I believe, what the noble Lord, Lord Hooson, advocated for his area. They have had some success thanks to the excellent co-operation from council officers, the backing of elected members, the money and efforts of the Welsh Development Agency (which has been frequently mentioned this evening), the support of the Welsh Office and the selective financial assistance

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  scheme. It has indeed been a thoroughly co-operative effort and there are signs that things are improving both economically and socially, though slowly. At least the unemployment figures have begun to fall.
  In the past year, unemployment in the Cynon Valley fell by 10 per cent. compared with 7.8 per cent. in the UK as a whole. So that was slightly satisfactory. But unemployment is still far too high and there is plenty more to do not only to bring industry to the valley, but also to improve communications in order to encourage people to travel to areas such as the greater Cardiff area where work is more readily available.
  However, there are worries and two in particular. The first is the fact that the Rhondda Cynon Taff Unitary Authority which comes into being in April has a total population of 232,000; Cynon Valley has 69,0000. As a result, out of 72 councillors in the new authority, only 12 come from the Cynon Valley and they hold no important committee chairs. They are, therefore, heavily outnumbered. Despite that fact, I hope that the new unitary authority will continue the work of regeneration in the Cynon Valley that has been a feature of recent years.
  The second worry is that the new unitary authority starts life, as I understand it, with a required cut in spending of £24 million, entailing a likely increase of 45 per cent. in council tax. If that is true, it is indeed a serious problem for a poor area. If the Minister is able to give us any comfort on those predominant worries when he replies to the debate, I should be most grateful.
  I now turn to a real success story in Caerphilly. There is a company called National Britannia which provides a package of environmental, hygiene and safety services and has many prestigious clients throughout the country, including Asda, Marks & Spencer, Littlewoods and British Gas just to mention a few. National Britannia was formed in November 1992 by Mr. Anthony Record. In 1993 it employed some 200 people and had a turnover of some £6 million. Last year it employed over 300 people and had a turnover of £9 million. Its latest objective is to spread its activities into mainland Europe. Apart from being a commercial success, it has fostered a feeling of mutual involvement among its staff, who feel themselves very much part of the company and responsible for its future. I am sure that there are many other small companies of this kind which are doing an admirable job, but this is just one that I happen to know well. I must declare a paternal interest because my son is employed in it.
  Finally, I wish to say a few words about the rural areas, which have been mentioned by other speakers. My personal interest lies in the neighbourhood of Llandovery. I wish to draw attention to the fact that, as in other rural areas, there are enormous difficulties for young people. It is hard for them to find employment and many of them go to the bigger towns or even leave Wales altogether and go to England. Those who stay behind still face many problems. In Llandovery there are 15 pubs but until recently there was no other meeting place for young people. This inevitably leads to problems of alcohol, of drugs and of vandalism. Now, thanks to the initiative of a young lady, Jill Tatman,
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  there is a new YMCA. Perhaps I should declare an interest as I am the president of the National Council of YMCAs in Wales. This new YMCA was started on a shoestring. The club was held in a school hall on one evening a week but it has proved to be meeting a real need—even though it was held on only one evening a week—by the fact that there was soon a membership of 95 boys and girls.
  I am happy to say that thanks to the generosity of some charitable trusts the YMCA has acquired a dilapidated church hall and, furthermore, has recently received a handsome grant from the National Lottery of £70,000 to renovate the hall and to buy a minibus. At present it is still staggering on in grim surroundings but it is managing to keep open three nights a week. The YMCA hopes that once the renovation is complete the club will be run for five or six nights a week. This is an astonishingly good performance and an example of the work the YMCA is doing for young people throughout Wales.
  I am afraid that this speech has been somewhat disparate, but one single theme runs through it—the success that can be achieved by individual initiative and enterprise. I have a few minutes left in which to speak and I wish to declare my support for those who advocate a general purpose theatre in the docklands area capable of providing a home for the Welsh National Opera company as well as providing a stage for ballet and other stage performances. I have great sympathy with that ideal. Many years ago I was chairman of the St. David's Theatre Trust. My fellow trustees were Sir Kenneth Trehearne, Sir Lincoln Hallinan, Clifford Evans and the great Saunders Lewis. We struggled along. We had an excellent architect in Elydr Davies and we received initial financial support from Richard Burton. We were trying to provide an all-purpose theatre for Cardiff. In those days the Welsh National Opera company had an amateur chorus and only a three-month season. There was no National Lottery to help us and I therefore sympathise very much with the difficulties with which the present trustees are faced. I very much hope that the Millennium Commission will see its way to reconsidering its decision. I believe that the docklands development needs a landmark building to crown its achievements.
  7.25 p.m.
  Lord Prys-Davies: My Lords, I wish to apologise to the noble Viscount, Lord St. Davids, for not being in the Chamber for the opening part of his speech. I had been to a meeting which was not unrelated to Welsh affairs. I also wish to thank the noble Viscount for giving us the opportunity to discuss the Welsh economy. Of course we gladly recognise that many parts of Wales have benefited greatly from the large-scale inward investment policies of the past decade or so. However, the benefits which flow from the new industries along the M.4 and, to a lesser extent, the A.55 have not reached the remoter rural communities and the industrial communities high up in the valleys of South Wales. In those communities there is high long-term unemployment and under-employment and income levels are low.

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  Of course the trickle-down process cannot be completed all at once and overnight. However, we are right to draw attention to the future of the poorer communities. I believe that their case is central to the whole question of the future of the Welsh nation. In preparation for this discussion—I say "discussion" because this is more of a discussion than a heated debate—I spoke to a number of people whose judgment I value and who live in the poorer communities both in the rural north and west and in the industrial valleys of South Wales, not far from where I live. I have to place it on record that some have expressed considerable disillusionment, even of anobaith; that is to say, hopelessness. I place that on record because it gives some sort of feeling of mood. However, I gladly acknowledge that there are other voices. Many of those who are working within the voluntary sector and with the local anturau—the local enterprise agencies—to regenerate local economies are more hopeful.
  I am not an economist or anything of the kind but it seems to me that the first purpose of economic policy is to enable all people to earn a decent living for themselves and their families, to provide an opportunity for our young people and to provide a reasonably civilised background for all our people. That is high principle but it leads me to ask a few questions of practical significance to the Welsh communities of which I have spoken. However, the Minister should not feel under any obligation to answer them all tonight, although obviously I should welcome a reply at a later stage if he is not able to do so this evening.
  My main questions relate to the policies of the Welsh Office and the need for more financial assistance from both the Welsh Office and the European Union. I have been encouraged by the degree of co-operation which is being achieved by the area partnership networks which seek to co-ordinate the activities of the local authorities and the agencies of central government, with their different objectives for different services. However, there is a grave shortage of matching strategic development funds. Can the Welsh Office enhance the funding available for the strategic development schemes?
  Like the noble Lord, Lord Aberdare, I have been told that the new unitary authorities will be very short of money. That is worrying, because in the past 20 years or so the total funding required at local level to embark on a community enterprise has included an important contribution from the local authorities. There is now widespread anxiety right across Wales that the new authorities, with their budgets under heavy pressure, will not be able to provide the funding which the county councils currently provide for economic regeneration. Is the Welsh Office seriously addressing that problem? I look forward with great interest to how the Minister will respond to the anxieties expressed by the noble Lord, Lord Aberdare, on that point.
  That brings me to the European Union funds, and in particular the European Regional Development Fund, the Social Fund and, in the context of rural areas, the Agricultural Guidance and Guarantee Fund. Can the Minister give an indication as to how European-minded
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  the Welsh Office is these days? Is its relationship with Brussels what it ought to be? There are anxieties about that relationship. I shall mention briefly the most recent cause for concern which has come to my notice.
  A few weeks ago the Scottish Secretary of State exercised his power to make the Rural Diversification Programme (Scotland) Regulations to implement for the benefit of Scotland's Objective 5(b) areas the European Council's decision to provide financial assistance for economic diversification of such areas. Under the terms of that order the Scottish Office can grant up to £25,000 (and in some cases £30,000) for approved diversification measures in respect of an agricultural holding. Why has the Welsh Office not made a comparable order? Is that not a symbol that its relationship with Brussels is not what it ought to be; or is it simply the case that the Welsh Office does not have the resources to enable it to proceed to make a comparable order independently of the Ministry of Agriculture? In any event, the delay in issuing a Welsh order comparable to the Scottish order needs to be fully explained.
  The last Secretary of State went through a difficult stewardship of the Welsh Office. However, I am glad that the present Secretary of State has not been afraid to change direction on occasion. Thus he has decided to publish a White Paper on rural Wales. Can the Minister give an indication when that document is likely to see the light of day?
  Under the last two Secretaries of State the Welsh Office committed huge resources and time to local government reorganisation. Can it now find some time to consider the future role of the Development Board for Rural Wales? As the noble Lord, Lord Hooson, explained, the board is a creature of statute, set up almost 20 years ago. There have been changes since then. Surely the board's area of operation should now include all the Objective 5(b) areas in Wales. Can the Minister please say a word about that?
  The partnership networks are conscious of the importance of information technology being made available for the economic development of the more remote areas. However, I shall not dwell on the importance of that technology as it is my understanding that the present Welsh Secretary has already grasped its significance. That is another issue upon which we should like to have assurance.
  My final comment concerns the role of the co-operative movement, which was part of the tradition of 19th century Wales. It still has relevance. That has been strikingly demonstrated by the solid achievements of the Welsh Co-operative Centre set up a decade or so ago and by the recent history of the Tower Colliery in Hirwaun. In a debate in your Lordships' House a fortnight ago my noble friend Lord Carter argued that there was a need for a new co-operative Act to take account of modern co-operative requirements and to provide modern legislative machinery. I urge the Welsh Office to take an interest in the proposal for new legislation which has been submitted by the UK Co-operative Council to the Treasury and the DTI.
  I shall be grateful if the Minister can answer some of the questions that I have addressed to him.
  7.35 p.m.
  Lord Kenyon: My Lords, I too should like to thank my noble friend Lord St. Davids for the debate. Four years ago, when the previous debate took place, I had not inherited from my father, so for me this is a first. I feel sure that it will not be the last.
  To the English it must seem curious that in the union of this United Kingdom we should set out to debate the economic condition of any particular region. We do not have debates on the economy in the south-west or the midlands region, but it is the historic nature of Wales that continues to set it apart from the rest of the Kingdom. While we welcome our union with the remainder of the country, we continue to cling fiercely to our identity as a principality, differentiated not least by our language and culture and largely unsullied by the Roman occupation. In a word, we are Welshmen first but we want the same terms and conditions as the rest of the country.
  Perhaps one of the greatest perceived disadvantages in Wales in terms of economic activity is its isolation from the rest of the country—"peripherality" in the words of Brussels. It is true that great advances have been made in the improvement of access to Wales, as has already been mentioned, but the concentration of economic activity in the south-east, where two major international airports (or four major international airports if one includes Luton and Stansted) make access so much easier. It means that there is always an uphill struggle when trying to attract new business to Wales.
  I should first of all declare my interest. Last May I was elected to the new Wrexham County shadow authority, so I am shortly to become a councillor in that authority. Two years ago I made my maiden speech on the Welsh local government Bill; it is no accident that many of those who spoke then are also speaking today, because Wales is paramount in their minds.
  The creations of that Bill, the 22 new unitary authorities, are now about to come into being. In just a few short weeks the unification of Welsh local government will come about. The transition has not been without its problems. The timescale was very short, as we pointed out at the time. Money, needless to say, is scarce and the cutting of the various bits of the cake has, from time-to-time, been acrimonious and will doubtless continue to be so for some time to come. Nevertheless, on 1st April the new authorities will open shop and the economic prosperity and progress of Wales will be an objective that they will pursue relentlessly.
  The new authorities realise that their goals cannot be achieved overnight and that there is a need for a concerted plan of action over a long period of time. More importantly, there must also be a partnership between all the players if success is to be assured. One of the problems of the past was the frequent lack of co-operation between county and district councils. That has now disappeared and the new authorities should be able to produce a single economic development plan specifically for their region.
  Of course, I am not forgetting the contribution of the government agencies. Those have already been mentioned. The Welsh Development Agency, the
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  Development Board for Rural Wales, the Welsh Tourist Board as well as the Department of Trade and Industry all play a major part in the development of a healthy Welsh economic environment. It goes without saying that the continuing partnership between those public sector bodies and the local authorities is fundamental to the success of any economic policy.
  On a national scale, economic development programmes are, quite rightly, the province of central government. But central government can only influence, as has already been said on at least two occasions earlier today. It does not create the economy or the jobs.
  Local government, too, is only a facilitator, or an enabler. However, it plays a central role in translating the national strategy into local action. The new authorities, even in their embryonic state, are acutely aware of the importance of keeping the momentum and of preparing now to form their own individual and collective views on how they wish to go forward in the coming months and years. Although it is a time of massive reorganisation and staff upheaval, they are conscious that they must not allow any strategic gap in the formulation and execution of the economic development plan. To allow such a gap would undo much of the good work that has been done to date.
  I believe that it is particularly important that a meaningful dialogue continues between my right honourable friend the Secretary State for Wales and the new authorities. I feel sure that he will acknowledge that the local authorities are in an ideal position to influence his policies and the other Welsh Office agencies' economic development policies rather than merely being directed by them, and that the local authorities should play an active role in the execution of the programmes.
  I am often reminded that Wales has benefited substantially due to the efforts of central and local government initiatives, and especially from European Union initiatives. I acknowledge that those have indeed been fundamental in encouraging the development of the economy. But it is all too easy to forget how Wales suffered after the war in the losses of jobs from the mining and heavy manufacturing industries as well as from agriculture.
  Wales continues to attract investment in new manufacturing industries and particularly electronics industries. Despite a general decline in manufacturing jobs in Europe, productivity in manufacturing, measured in terms of GDP per person, has increased in Wales to the extent that we are now among the highest in the European Union.
  However, in highlighting those strengths, we must not be fooled into thinking that all in the garden is rosy. Wales is still a long way behind the rest of Europe, and the position, if anything, is getting worse. Between 1981 and 1991 GDP per person dropped from 85 per cent. of the EU average to 83 per cent. and that even after the addition of Portugal, Spain and eastern Germany to the Union. For rural Wales the GDP in 1991 was even worse at little more than three-quarters of the EU average. Between 1983 and 1993 the average pay of those in employment in Wales compared with the rest of the United Kingdom

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  fell from 94 per cent. to 89 per cent. Therefore while it is true to say that jobs are being created in Wales, they are all too often low paid jobs.
  The goal for the future of the Welsh economy must he that set out by the Institute of Welsh Affairs; namely, to ensure that Wales enjoys a quality of life as good as the best in the European Union. In the light of the present starting point, which already shows evidence of deterioration, as well as tight spending plans and fierce competition from other regions of the UK and the remainder of Europe and of the world, this may sound like a tall order. But the evidence of success and the will to succeed are already there, and with the advantages of the higher public investment levels and the dedication of the development agencies in particular we are well placed to achieve that given a clear vision and leadership, and a willingness of all partners to engage in the closest possible collaboration.
  I wish briefly to touch on agriculture, and in doing so to declare my interest as a farmer and landowner; I know that my noble kinsman Lord Harlech will speak at length on that. The continuing structural changes are having a devastating effect on the rural communities. I know that this problem is by no means exclusive to Wales, but in many of the more remote rural areas there is no alternative to agriculture. Agriculture will always be the predominant factor in the economies of those areas. Many marginal hill farms in Wales produce incomes totalling less than £8,000 a year, and that probably for a 12 hour day, 365 days a year, no holiday, and precious little social life other than a weekly trip to the livestock market. It was a cruel blow to this disadvantaged sector of the farming community when the hillside livestock compensatory allowances (HLCAs) were cut. Such a small saving to the public purse has a magnification factor of indescribable proportions in the Welsh hills and valleys, and I hope that the position will be redressed very soon to stem the ongoing depopulation of rural Wales.
  I look forward to the White Paper on rural Wales which was promised by my right honourable friend the Secretary of State for Wales. I am sure that it will contain a cast-iron commitment to ensure the long term viability not just of agriculture but of the overall management of the rural environment in Wales. Anything less will spell disaster.
  The Welsh team are playing strongly, but they must keep their eyes firmly fixed on the ball if they are to win the game.
  7.45 p.m.
  Lord Davies: My Lords, first, perhaps I may thank the noble Viscount, Lord St. Davids, for initiating the debate on the economy in Wales today. I declare an interest in that I am the chairman of Welsh National Opera and trustee of the Cardiff Bay Opera House Trust. I wish to speak briefly on the effect on the Welsh economy of those two organisations—the first actual and the second potential.
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  Welsh National Opera, now celebrating its 50th anniversary season, has built an international reputation for excellence on the secure foundations of a company growing from an amateur band of musicians and singers, many from down the mines—truly the voice of the people. Fully professional for the past 20 years, the company employs at its headquarters in Cardiff some 250 full-time staff, including chorus and orchestra, and 50 or so part time. Of the turnover of £10 million, £7 million to £8 million goes directly back into the local Welsh economy. On the income side, some £2.1 million comes from ticket sales in England, and £0.5 million is earned by the set-making arm of the company, making sets for other companies in the UK and abroad. In the past year £170,000 was earned from a Japanese company for sets and costumes for "Madame Butterfly" for performances in Tokyo—a most successful collaboration. During the past three years the company has averaged £0.5 million in overseas earnings from production hires, foreign touring and set construction.
  But Welsh National Opera is probably more important to the Welsh economy in indirect ways. For many years the company has established a reputation for such quality in its work and care with its preparation that it has been able to attract artists of the highest order and as a result has created some productions that have aroused international interest. Thus the company has been invited abroad, including visits to Paris, Milan, New York and Tokyo. The last two visits were made in co-operation with the Welsh Development Agency and enabled it to reach a very large number of the captains of industry in both countries. The huge success of both visits was enhanced by the presence at a performance of our patron, the Princess of Wales, with, in Japan, the Prince of Wales, resulting in enormous media exposure for Wales associated with the excellence of the company. That, together with the improvement the company thus gives to the perception of the quality of life for staff living in Wales, will have played its part in the success of Wales in attracting overseas investment.
  Welsh National Opera is part of the way through its 50th anniversary season—wonderfully successful so far—with three new productions still to come, a celebration concert at St. David's Hall, a newly commissioned opera to open in Llandudno in July and a further season sponsored by Amoco at the Royal Opera House in March. The company's balance sheet remains in the black and we expect this year to end with another small surplus. But serious threats to the future viability of the company can be seen ahead. The government policy of cutting funds for the arts is already having a serious effect and, if continued, will mean the end of the company as we know it within a very few years. After all, most of the benefits to Wales that I outlined earlier will be lost if the company is not able to continue to work at the highest level. A great asset can be quickly lost.
  The other threats to its future are the compulsory purchase order on its headquarters for development due to be enforced in four years' time and the setback to the plans for a new home posed by the refusal of the Millennium Commission to support present plans for the Cardiff Bay Opera House. Ideas for this scheme started

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  to form in the mid-1980s when it was realised that a centre for the performing arts, as it was then known, could form an important and constructive element in the planned regeneration of what was then a derelict docklands area. It was the vision of the Secretary of State for Wales, Nicholas Edwards as he then was, to link the city of Cardiff with its waterfront, a new waterfront that would rival the great waterfront developments of Baltimore and even Sydney.
  By 1991 a steering group had been formed under the auspices of the Cardiff Bay Development Corporation. Major feasibility studies into the viability, economy and fund raising were put in hand for the new opera house, as the project was called, at the instigation of the then Secretary of State for Wales, Peter Walker. Perhaps he had that most famous waterfront opera house in Sydney in mind, which is also used for far more than opera for much of the time.
  Re-reading some of the most comprehensive reports in preparation for this debate, I have been struck by how well they have stood the test of time and how accurate their figures for all but inflation have remained. The conclusion of the economic report by KPMG contained the following:
  "In both appraisals the quantifiable benefits are small compared with the capital and operating costs. Consequently, the economic case depends upon the weighting attached to other factors, notably the extent to which the opera house would enhance Wales as a location for inward investment and benefit the local community.
  As regards inward investment, it is estimated that the net present value of the options involving the construction of the new opera house would equal zero if investment projects from overseas worth £5 million-£6 million per annum at July 1991 prices were attracted by the presence of the opera house. The likelihood of this occurring should be assessed in the context of the fact that, in 1988 and 1989, the total number of such projects attracted to Wales was 104, with an average value of £14.5 million. The net present value of the base case in which no new facility is created is minus £5.5 million …
  Taking into account both the quantifiable and other benefits, the appraisal shows that a prestige building with a single auditorium is a better option than a low impact building with a single auditorium, and that the case for the second auditorium rests largely on benefits to the community".
  All the studies concluded in favour of the project and the Welsh Office was urged to combine with private funding to bring forward the necessary funds. (At that time there was no lottery.) Without commitment to the eventual outcome, further substantial funds were provided by the Welsh Office through the Cardiff Bay Development Corporation for the development of a design brief and for a major international architectural competition to be completed. Although, perhaps inevitably, not everyone approved of the outcome, the competition itself was generally regarded as a model of its kind.
  By this time, of course, the lottery was in being and a detailed application was made to the Millennium Fund. The fund was chosen as the appropriate body because the Arts Council fund which would normally be the source for such funding is split between England and Wales. So the Welsh element is not of a size to be able to cope with large projects of that sort. The Millennium Fund is not so split, but it funds only 50 per cent. of a project, whereas the Arts Council fund will go to
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  75 per cent. That has a most serious effect on a project like this in Wales, which is an area less financially favoured than many in England.
  The application was duly considered by the commissioners at Christmas and turned down in its present form, to the great dismay of our many supporters, both in Wales and in England. I do not think it helpful to dwell on the reasons for that decision. Suffice it to say that we found some of them surprising.
  However, we have been listening carefully to what has been said and seeing whether the commissioners' concerns can be met. We have entered into conversations with other bodies and organisations to see whether both the capital and the running costs can be spread and the value of the building to Wales increased still further. Those conversations are continuing and arc opening up some most exciting possibilities.
  This is the most crucial project for the regeneration of Cardiff and the economy of Wales. As reported by the Millennium arts assessor for the project, it represents by far the most significant landmark project yet to have emerged from the cultural sector in England and Wales. Yet it will also provide jobs in the area of highest unemployment in Wales. It will provide a home and a future for Welsh National Opera, but it will be used for musicals and dance even more than for opera, which, in any event, is not an elitist art form as practised by Welsh National Opera. Anyone who attended the performances of "Madame Butterfly" or "Nabucco" in the packed 2,500-seat Liverpool Empire before Christmas would testify to that. The trust has already evolved a programme for the involvement of young people and the community in the design and development of the project. Access and participation for all are central to the design of the building and the thinking of the trust.
  Whether or not one likes the design, there is no doubt that it has the potential to make the impact into the next century that the Sydney Opera House has made in this and also to be a much better theatre. What is more, it is the only one on the table which could be built for the Millennium and thus attract Millennium funds. The door is still open at least a chink and it is essential that all in Wales—local authorities, industry and commerce, the Cardiff Bay Development Corporation, the Welsh Office, the Arts Council and all interested bodies and people—get behind this project and push it through.
  Do we really want to be remembered in the next century as the generation that celebrated the Millennium with cliff paths and bicycle tracks—worthy though such projects are—rather than a project that will make an impact on how the world views not just Cardiff and Wales but the UK as a whole?
  7.55 p.m.
  Lord Griffiths of Fforestfach: My Lords, it is a great pleasure to follow the noble Lord, Lord Davies, in his eloquent statement of the case for the opera house, which I believe most, if not all, of us wish to support. It is also a great pleasure to take part in the debate this evening on Welsh affairs. Like everyone who has spoken so far, I wish to thank my noble friend Lord

  1523
  St. Davids for giving us this opportunity. Having trained as an economist, I interpret the Welsh economy rather narrowly and I wish to take it from that perspective.
  As one looks at Wales over recent years, if there is one word which I wish to use to describe the country as we stand back to look at it, it is "success". I use it advisedly and the reason I do so is that Wales has gone through the most extraordinary restructuring in recent years. It has gone from being dependent on coal and steel to being today a totally different economy. As my noble friend Lord Aberdare reminded us, it is a success based on individual enterprise and effort.
  Perhaps I may remind noble Lords that before the Second World War there were about a quarter of a million people in Wales employed in the coal and steel industries. They accounted for 25 per cent. of the Welsh labour force. Today the figure is less than 20,000, under 2 per cent. In the past decade nearly 100,000 jobs have been lost in those two industries in Wales. In 1980 there were 35 working pits; today there are two. Yet today employment is greater in Wales than in 1975 and unemployment is near the average for Great Britain as a whole. That has not been the case since the mid-I920s.
  What is even more remarkable is that the resurgence in Wales has been driven by manufacturing. As we were reminded by my noble friend Lord St. Davids, manufacturing in Wales has had one of the highest productivity levels in these islands. Not only that, the manufacturing resurgence is broadly based. Companies which have invested and grown in Wales are in the consumer electronics, car components and multimedia sectors. They are also in aircraft maintenance, frozen foods and a whole variety of other areas. We have left behind dependence on just two major industries. For example, in areas of electronics like opto-electronics we are world leaders, with 10 per cent. of the world market for optical fibres, employing about 40,000 people. Self-employment in the Principality has increased over 20 years by about 70 per cent. Cardiff, we are reliably told, is predicted to be the most rapidly growing conurbation in the United Kingdom for the rest of the decade.
  Although Wales started from a low base, earnings have grown more rapidly than in the UK as a whole; and Welsh GDP per capita has grown more rapidly. As a result of the extraordinary restructuring that has taken place, with a tremendous loss of jobs in coal and steel and the revival of broad-based manufacturing, the Welsh economy today is stronger, more robust and more vigorous than it has been for a very long time. That is something with which the Government should be satisfied. However, it is not the whole story, and I shall come to that later.
  What factors have given rise to this? It is very easy for someone of my background and inclinations to say that it is entirely a result of the market economy and of enterprise. Government policy is very important. One cannot emphasise enough that low inflation, low taxation, low interest rates and a rejection of the social chapter from Brussels are an ideal background against which enterprise can grow and inward investment can be attracted. Looking at Wales over the past 20 years,
  1524
  when unemployment has risen in the United Kingdom, possibly because of mismanagement of the economy, unemployment has risen in Wales. When unemployment has fallen in the United Kingdom, it has fallen in Wales. In the early 1980s unemployment was rising both in the UK and in Wales. In the late 1980s it fell in both cases. In the early 1990s, it went up again in Wales and in the United Kingdom, and since 1993 it has fallen.
  Secondly, it would be foolish to suggest that the public sector has not played a critical role in the resurgence in Wales. We have heard much in this debate about public spending on infrastructure, about roads, the Severn crossing and the cleaning up of dereliction, particularly in the Valleys. All those strike me as terribly important and necessary factors in getting enterprise going. In some cases it could have been done by the private sector. However, it would have taken a lot longer and would not have been nearly so effective.
  A number of noble Lords referred to the quite extraordinary success of Wales in attracting inward foreign investment: £4 billion over the past five years. With only 5 per cent. of the population of the UK, Wales has nevertheless attracted between 10 and 15 per cent. of inward investment. Before this debate I looked up the names of the companies that have come to Wales with inward investment. Going through the list of companies—Aiwa, Bosch, Calsonic, Sony, Ford etc.—we find a thousand jobs here and a thousand jobs there. We see broadly based inward investment coming to Wales.
  There is a fourth factor, not much mentioned this evening, that is critical; namely, the people of Wales. It is the resourcefulness of the people and their willingness to be adaptable in the workplace, to be flexible in their working practices, that has led to the high productivity in manufacturing that was referred to. The Welsh economy is a success story.
  That said, there are some serious problems. There are unemployment blackspots; there is very high youth unemployment; and there is low pay, as referred to by the noble Lord, Lord Kenyon, especially in the field of services. I have to say that low pay is better than no pay, and being in a job is the best way of improving one's job. However, low pay results in low skills.
  There is one matter to which I draw the attention of the House. Last year, Panasonic led inward investors to Wales in making a statement claiming that there had been a drastic failure in the education system of Wales. It advertised six apprenticeships for 16 year-olds with five or more GCSEs. Of over 200 applicants, only three had basic level education. Sony said its experience was very similar. People dropped out before their apprenticeship was complete. Other inward investors have reported a lack of well-qualified people, which is now becoming a constraint in Wales.
  I see this as a very serious problem. The noble Baroness was right to say that innovation would be wonderful. We should also like to see the expansion of inward investment. Clearly it will not come about simply by more firms coming to greenfield sites; it will have to come about where it is. But people are telling us that there is inadequate basic education and that there

  1525
  is an attitude problem. Post-16 education is too academic, and too many of the people in TEC training are being trained outside of engineering and outside of business.
  That is a problem that the Government must face and tackle. I wish I could be as enthusiastic about education authorities as the noble Viscount who proposed the Motion. While I am totally committed to the measures the Government are taking, I should love to see more partnership involving private sector firms and government spending in order to solve this problem.
  8.6 p.m.
  Lord Harlech: My Lords, I join noble Lords in thanking my noble friend Lord St. Davids for initiating this most important debate.
  The Government's achievements in attracting investors from around the world to revitalise, as we have heard, the worn-out and run-down coal and steel communities of North and South Wales demonstrate how much can be done through a combination of private enterprise, central and local government working together in co-operation, and indeed the same return of funding from Brussels as we invest as partners in the EU.
  Although the most rabid advocates of the free market economy might find this success—involving, as it has done, active government support and intervention, an embarrassment in some ways, I certainly do not see it as that. Without skilful stage management, at which, to its great credit, the Welsh Office has become adept, Wales—one of the most successful regions in Europe, as we heard, attracting inward investment—would not still be getting that investment.
  My noble kinsman Lord Kenyon was kind enough to say that I should go into careful detail about agriculture. In fact, I shall identify mostly with the rural economy, of which that is, of course, a very important part. I also agree with my noble kinsman that I must declare an interest as a farmer and landowner.
  The rural communities of Mid and North Wales that I know best have different problems, for which the solutions are much less obvious. The problems facing those communities are by no means peculiar to Wales. Indeed, they are to be found in the remote areas of Scotland and throughout upland England.
  Perhaps the first thing to be said about these areas is that the people who live and work in them do not wish to be patronised by politicians who have no understanding of the issues that matter most to them. Together with other remote parts of rural Europe, with which I have some familiarity and which I know make up a tiny minority, they are not peopled by some form of flotsam, left marooned when their fellow countrymen left for life in the cities. The people of whom I speak choose to live and work where they do. They certainly do not see themselves or their communities as a sort of political problem.
  They do not wish to rely for their livelihood entirely on hand-outs from government, while needing some support of course for schools, health, housing and, as we have heard, to encourage commerce. The 1990s are
  1526
  clearly turning into a decade of cost-cutting, in government, in industry, in the professions, and in services—and not only in Britain. Who can feel happy or secure at being dependent wholly on the Government or on European Union grants and subsidies at a time like this?
  Tourism and agriculture are always likely to be the mainstay of a rural economy. That is very true in North and Mid Wales. But throughout North and Mid Wales there are large numbers of decaying and, for modern farming practices, impractical buildings of traditional construction that could, with some encouragement from the planners—I say that carefully—provide accommodation for a wide range of light industrial and office uses. Although the conversion of such buildings into holiday accommodation—we have heard a little about that this evening—to an extent benefits the local economy, it does not make a major contribution to local employment on a constant basis. Unfortunately, it is also transitory. Its impact lasts only a short while. Therefore, small manufacturing service industries would be greatly encouraged to stay where they are by the assistance of government, of whatever political complexion.
  In the age of the computer and the Internet it would presumably be possible for differing skills and interests to work in quite remote areas of the countryside and communicate with cities via data lines. At any rate, I believe that to be the theory, though I am not an expert. Perhaps the Government should be looking into ways to make that a reality.
  Another form of communication which is of constant concern in those parts of Wales with which I am familiar is public transport. While during daylight hours, as the noble Lord, Lord Elis-Thomas, said, the journey is pleasant, it can be arduous even over a small distance when one has to make a lot of changes.
  All political persuasions may think that they can cure the public transportation problem in remote areas, but so far they have not done so. For one reason or another I rely heavily on public transport, as some noble Lords may be aware. It has totally failed the rural communities.
  Finally, I draw your Lordships' attention to what I see as a potential danger in the future affecting areas such as Wales. The rules, regulations, memoranda, protocols, and bureaucracy of Brussels, Strasbourg, London, Paris and Rome may, in some instances, be wholly impossible or, at any rate, impractical to put into effect in rural communities—for instance, in Penrhyndeudraeth, Llanfihangel-y-traethau, Blaenau Ffestiniog, Llanfairpwllgwyngyll, Goch Dré or Llantysilio Goch Goch Goch. It would be all too surprising to me if the best policy for dealing with, for example, waste disposal or homelessness, hospitalisation or communications, were the same in a city of 3 million people as that for a rural area not one hour away with an average population of three persons to the square mile. The solutions cannot be the same.
  It sometimes seems to me that a strand runs through the European institutions, a thought which cannot cope with diversity in any form. But diversity in any form is extremely difficult to measure unless one is raising it

  1527
  from a city format. That cannot be translated into a rural area. But whether or not politicians and civil servants like it, I am delighted to say that we live in a world of startling diversity and in which my native Welsh people will always play a major role.
  8.15 p.m.
  Lord Geraint: My Lords, it has been an interesting debate initiated by the noble Viscount, Lord St. Davids, and I thank him for his contribution this evening. We had excellent contributions from noble Lords on both sides of the Chamber and all those who spoke, in my view, care for Wales, its people and its economy.
  I was fortunate to be elected on to Cardiganshire County Council 44 years ago—that is a long time. On the agenda in those days was the economy of Wales. Those of us who had been brought up in the rural parts of Wales and in Mid Wales in particular, were talking then only about the problem of depopulation and what could be done to stop it taking place. Over a period of 50 years between 50,000 and 60,000 people had left Mid Wales. There was no work for them. That was due to the closures of the old lead mines at the turn of the century.
  I remember at the first or second meeting of the Cardiganshire County Council in 1952 we decided to form the Mid Wales Development Agency with representatives from Breconshire, Radnorshire, Montgomeryshire, Merionethshire and Cardiganshire. From there it developed and excellent work was done for a period of years. Then, in the 1970s, we established the Development Board for Rural Wales and the Welsh Development Agency. As a nation we are fortunate to have those two boards. People will say perhaps that they are quangos; but in my view they are not.
  Those two boards have saved Wales and especially Mid Wales. They have helped to stem the depopulation. The Development Board for Rural Wales covers 40 per cent. of the land area with a population of 213,500 inhabitants, but only 7.5 per cent. of the total Welsh population. It has among the lowest population density in Europe, yet it is the centre of Welsh language and culture. Twenty-five years ago the population was approximately 185,000. It was therefore a wonderful achievement on the part of the development board to turn the economy around. I agree entirely with my noble friend Lord Hooson that we will never survive in the rural areas without government involvement. The Development Board for Rural Wales and the Welsh Development Agency have proved that point.
  Mention has been made of the unemployment rates which, in rural Wales, were 50 per cent. above the Great Britain average. But today, the DBRW has helped to reduce that to only 20 per cent. below the GB average; that is a wonderful achievement. I hope that it goes from strength to strength.
  We are talking of inward investment. I was delighted to read a few weeks ago of the first ever direct Japanese investment attracted to rural Wales—a £5 million project. We are fortunate. Then we have the European headquarters of the Canadian company, Fisher Gauge Limited, being built at Welshpool, and it goes on and on. We are proud of that record.
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  I became a Member 44 years ago and have been in public life ever since. I have had the privilege of declaring an interest in agriculture and farming, but today I have to add that I am now a retired farmer. It sounds even better, does it not? I have received many letters recently. There are many problems that face the agricultural industry. I have received a letter from the well known National Sheep Association whose affairs are run by Mr. John Thorley, who is a very good chief executive. That body is very perturbed about the Irish distortion in relation to sheep. The recent special deal negotiated by Irish farmers has made the United Kingdom sheep industry highly critical of the British Government for allowing Irish sheep farmers once again to benefit at the expense of United Kingdom and Welsh producers. The deal which allows farmers in the lowland areas of Ireland an extra £8.46 per ewe in European Union payments in 1995 compared with 1994 is seen as grossly unfair. It distorts the market in both the immediate and long term and helps the Irish to undercut Welsh lamb prices. In addition, it will sustain an uncompetitive Irish lamb producer and contribute to a small and destabilised European Union sheep market. Just under 10,000 flock owners will have benefited from this special deal, with a total of about 1.2 million ewes which provides an increase of £10 million, or an average of £1,000 per producer. I advise the Minister to keep in touch with the National Sheep Association, which is a wonderful organisation, to ensure that the interests of sheep farmers are well looked after in the years to come.
  I have spoken to agriculturalists in Wales, many of whom have referred to the future of the common agricultural policy. The major problem that faces the milk and sheep industries is the quota system. They would like to have a lead from the government of the day as to whether or not quotas will be around up to the turn of the century or afterwards. I am sure that the Minister is aware that very often quota is worth more than the stock. If it came to a sudden end the industry would face a major financial problem.
  Another major problem in Wales relates to county council smallholdings. We are fortunate that we have so many of them both in Wales and England. Perhaps the Minister can tell me—or write to me if he cannot answer tonight—the latest developments in regard to the bid by a merchant bank to buy the 5,728 county council smallholdings in England and Wales. In his wind-up, can the Minister give an assurance to the tenants of those smallholdings that the county councils will remain their landlords in the years to come? Another major problem is rural crime.
  I deal next with the White Paper for rural Wales. I agree entirely with the sentiments expressed by the president of the Farmers' Union of Wales. That body believes that a departmental structure of the Welsh Office will lend itself to the establishment of a rural affairs department responsible to the Secretary of State for Wales. I hold that view. It is very important to the rural economy. I am sure that that department can he set up in the Welsh Office, and a similar department in Brussels, to look after the interests of farmers.

  1529
  So far as communications are concerned, can the Minister give an assurance that the road from Montgomeryshire to Cardiganshire will be improved in the years to come?
  Finally, I believe that the Minister will agree with me that the economy of Wales will never be the same if Wales beat England on Saturday at Twickenham.
  8.25 p.m.
  Lord Williams of Elvel: My Lords, the House will be grateful to the noble Viscount, Lord St. Davids, for introducing this debate and making it possible. Many interesting contributions have been made. The picture that comes across to me is somewhat patchy. Many noble Lords claim, quite rightly, success in many parts of the Welsh economy; others, like my noble friend Lord Prys-Davies and the noble Lord, Lord Aberdare, point to certain difficulties. In particular, the noble Lord, Lord Geraint, has pointed to difficulties in agriculture.
  It may be appropriate if I say a little about the industrial sector, go on to agriculture and finish with some thoughts on rural Wales. As the noble Viscount, Lord St. Davids, said, manufacturing has been the success story of South Wales and possibly the A.55 corridor as well, though on a lesser scale. I detected in the speech of the noble Lord, Lord Kenyon, a degree of sentimental regret, which I share, that the mining industry had collapsed so quickly. In my view, it was not quite so necessary. I believe that had the economics been slightly different, as Tower colliery has shown, Wales might still have had a mining industry of considerable proportions. To leave that aside, the transformation described so graphically by the noble Lord, Lord Griffiths, has been a success story. I agree with those noble Lords who say that all shades of government, but particularly those that have been interested in and formed the agencies about which noble Lords have spoken, are quite rightly credited with a large part of the responsibility for that restructuring. I do not believe that to be a party matter. Governments of both colours have pursued roughly the same policies.
  Inward investment has been in part the key to this. There are now 360 overseas-owned plants in Wales—about 100 more than in 1985. Employment in those plants has risen by 50 per cent. In 1993–94 inward investment projects promised to create or safeguard nearly 14,000 jobs. We must be grateful for that. But the 1994–95 report of the Invest in Britain Bureau indicates that Wales is slipping a bit in the league table. We are getting only 11.5 per cent. of United Kingdom inward investment, whereas in the 1980s we were scoring 20 per cent. I believe that the changes in assisted areas put in place in 1993 have contributed to the decline in the percentage of inward investment that comes to Wales.
  Another problem in relation to inward investment was graphically described by the noble Lord, Lord Griffiths. There is a clear skills shortage in Wales. I believe that that is part of the price of inward investment. Much of it has come from assembly and other operations which result in low-skilled, low-paid employment. Wales has failed to develop a suitably balanced overall industrial
  1530
  structure. Added to the problems in the educational system, as pointed out by the noble Lord, Lord Griffiths, Wales is in danger of having a clear skills shortage. It was pointed out in Cardiff in March 1995 by the then Director-General of the CBI:
  "More successful regions of the European Union appear to have a better-educated, better-trained workforce. We know that training remains the Achilles heel of the economy, and that is particularly true in Wales. Inward investors like Panasonic and Sony have been telling us of their disappointment at the quality of applicants coming forward. That is a worrying sign at this stage of the recovery".
  Ignoring these concerns, the Government cut the budget of Welsh training and enterprise councils by 17 per cent. in 1995℃96.
  As a result of that policy we are in danger of becoming a low-skill low-wage economy. Pay levels, which were relatively high in Wales in relation to other parts of Britain under the last Labour Government, have fallen dramatically while the Conservatives have been in power. That is the only party point I shall make. Average weekly earnings for full-time employees in Wales were £291 in 1994, the lowest level of average earnings of all the 10 regions of Britain. Forty thousand people in Wales earn less than £2.50 an hour. That is a dangerous situation for any country to find itself in. We have to consider carefully what plan of action is needed.
  We need to encourage the expansion of existing indigenous and foreign industry in Wales. We need to capitalise on the multiplier effect of major manufacturers in Wales, to some of which the noble Lord, Lord Griffiths, referred. We need to attract investment with high value added employment. We need to assist the expansion of small and medium sized enterprises which are the main generators of employment, particularly those that can cluster around major companies—such as Panasonic and Sony, which are coming in with their big plants—to provide components. We have to concentrate on that area.
  I shall move on to agriculture. I was most interested in the comments of the noble Lord, Lord Harlech, on the matter. It is perfectly true—this is my personal experience as well—that large areas of Wales, particularly of Mid Wales and North Wales, will, for as far as we can see, depend on agriculture as a main industry. That lands us with all kinds of problems. As the noble Lord, Lord Geraint, mentioned, there is an Irish problem which is suddenly produced out of the blue. We all agree, and have agreed for a long time, that we should reform the CAP. But if we reform the CAP, what will happen to the Welsh hill farmer? If, as we have heard before, the HLCA is suddenly removed and the CAP is suddenly restructured, plenty of my neighbours in Radnorshire will go straight out of business and into bankruptcy. I should like to be cautious about this because agriculture will keep those people, ourselves and our countryside alive. After all, there are four times as many sheep in Wales as there are human beings. We have to look after the human beings as well.
  It is not just a question of small hill farmers. Rural market towns like Builth Wells and Llandrindod Wells depend on the farming community for their prosperity. There is a knock-on effect. Shopkeepers, transport and

  1531
  so on depend on a healthy agriculture. There are things we can do which I hope the rural Wales White Paper will recommend. The noble Lord, Lord Harlech, mentioned the possibility of converting out-of-date agricultural buildings into possible small factories. They are what are called the new cottage industries; electronics networks, people working out of their own homes with computers which are linked up to central organisations in towns. The activities of the DBRW, which the noble Lord, Lord Geraint, rightly praised, should be devoted to that end. But there is no point in pretending that that will more than scratch the surface of the problem of the general poverty of Mid Wales and the Mid Wales farming community. We have to address that point.
  Finally, I wish to say a few words about tourism. I agree with all that has been said about improving the transport system. It is well known that it is easy to get into Wales but very difficult to get up and down Wales. Anyone who has driven on the A.483 will know what I am talking about. Tourism is fine but it is seasonal. We are not like Switzerland. We do not have a winter tourist season. The Swiss have a winter tourist season and a summer tourist season. One can see it in my part of the country and in the part of the country of the noble Lord, Lord Aberdare. In July and August we are flooded with tourists. However, they all go away again in September and we do not see them back until the summer. However many hotels or theme parks one builds, it will always be a seasonal operation which will be run down when the season is finished.
  Unemployment is too high. The Government have pursued good policies in many respects. We look forward to the rural Wales White Paper but it must address all the problems in rural Wales as an entity rather than try to disperse them as I think the rural England White Paper did.
  8.35 p.m.
  Lord Lucas: My Lords, I thank my noble friend Lord St. Davids for initiating the debate, though I find myself greatly awed in rising to answer. All noble Lords who have spoken share knowledge, experience and wisdom to which I cannot lay claim. They also share a great and evident love of Wales. That I can understand because my mother's family lived in Wales for 250 years. Even 150 years after they left one can see in their journals the regret at their departure. Not that that regret was shared by the Welsh. There is still a plaque in Ruthin church recording the day the de Greys left. It was a great relief to the Welsh that they did.
  Wales has some extraordinary economic advantages—its people, its countryside, the Welsh language, culture and heritage. It has made excellent use of those advantages. As my noble friend Lord Griffiths said in a powerful speech, the theme of the Welsh economy over the past 50 years is success. Wales has recovered from the decline of its primary industries, celebrated in detail by my noble friends Lord St. Davids and Lord Griffiths of Fforestfach. In all the speeches
  1532
  today credit has been given where credit is due—first and foremost to the Welsh people and in due measure to governments of all colours.
  It was a pleasure to hear the noble Lord, Lord Williams of Elvel, saying nice things about the Government. I hope that it will not be the last time. The noble Lord, Lord Hooson, was also lavish in his praise. And from the noble Lord, Lord Elis-Thomas, I thought I even caught a longing for the day when the Welsh railways are finally privatised.
  Noble Lords: Oh!
  Lord Lucas: Perhaps I was mistaken. Noble Lords have raised many different aspects of the Welsh economy. I shall be able to address but a few of them in the time available. I am particularly aware that I shall have to write letters to the noble Lords, Lord Prys-Davies and Lord Geraint, and perhaps others too. I shall look through Hansard tomorrow.
  I turn first to the subject of rural Wales. As the noble Lord, Lord Prys-Davies, said so accurately, this is central to the whole future of the Welsh nation. We shall shortly be publishing a rural White Paper for Wales. I could go into great detail of what it contains but I think I should get into difficulty with my Secretary of State if I did. I shall confine myself to the broad principles. The first is to ensure that rural Wales remains rural and keeps its identity. We do not want to change it from what it is. We do not want to destroy it. We want to ensure that whatever changes or improvements come about they do not do so at the cost of what is there now. The Government are committed to promote conservation and to preserve our natural heritage. The role of the Countryside Council for Wales is being enhanced. Its budget for 1996–97 has been increased by 24 per cent. I hope that that is welcome to the noble Lord, Lord Elis-Thomas. We are committed to providing positive support to rural communities. The quality of life in a rural community is of paramount concern to us. We intend to place emphasis on such areas as housing, rural health, village shops and schools.
  I hope that it will please the noble Lord, Lord Williams, and many others who have spoken that we support and value farming as a foundation for rural life and the environment. We shall be embarking on, and continuing, a number of initiatives to support the Welsh farmer in developing the specialist market for Welsh foods and we shall follow through the farming families initiative.
  Although CAP reform is eventually on the cards and is something to which all parties in this House are committed, I believe we all recognise that hill farms will continue to need, and deserve, our support. We intend to support new employment through initiatives in such areas as planning, IT and, most importantly, education and training. Perhaps the most crucial need is for more people to live and work in rural Wales. As my noble friend Lord Harlech said, the force for that may be the telecommunications revolution. As it becomes as easy to do a job from a house in west Wales as from a flat in Battersea, noble Lords will not be surprised to learn that more people are choosing west Wales.

  1533
  Perhaps I may allow myself my one piece of party politics. In telecommunications we are doing what the Labour Party has only dreamt of. That party's plans, announced at the 1995 party conference, were well described by Wired magazine:
  "When the history of Britain's lane on the information motorway is written, the October 1995 Labour Party Conference will hopefully go down as its most surreal moment … It's hard to imagine a more clueless or counterproductive policy than this deal".
  If ever the time should come, the deal will be completely unnecessary because we have already put in place most of what the Labour Party says it wishes to do. Half of all Welsh schools will be on the Internet by 1998. Every secondary school in Wales has satellite equipment. South Wales is being connected to cable television at a great pace. The strategic development scheme is bringing the information highway to rural Wales and the WDA is putting a great deal of effort into teleworking and bringing to Wales the kind of jobs that can be accessed through Internet and communications. Wales already boasts the largest concentration of such businesses in the UK.
  Inward investment has been one of the great Welsh success stories over the past 15 years. Since 1983, over 1,000 projects have been recorded with capital investment of about £7 billion, safeguarding or creating about 100,000 jobs. This success is bringing new industries not just to the industrial heartlands of Wales but to many rural areas as well. I know that the noble Lord, Lord Geraint, will be pleased at my assurance that the Welsh Development Agency will always look for people capable of making such investments in rural Wales and will pursue them with particular vigour.
  The noble Baroness, Lady White, was supportive of our efforts in research and development. We agree that that is a crucial aspect of any strong economy. Research and development is where future jobs in an economy come from. It may seem expensive now, but research and development repays itself many times long into the future. We are supporting many young and innovative companies, particularly in South Wales.
  Native talent has not been idle either. The performance of indigenous companies is crucial to the success of Wales. The training and enterprise councils in Wales support an average of 2,000 new business start-ups each year. It is vital that these new firms receive the support and help they need to prosper and grow. The launch earlier this month of the business connect scheme provides exactly the sort of comprehensive and accessible system that busy people need. The new arrangements take the hassle out of the quest for advice over a whole range of activity. With only one telephone call a network of advice will be available to businesses.
  My noble friend Lord Griffiths of Fforestfach and the noble Lord, Lord Williams of Elvel, mentioned education. I do not want to stray too far into that subject today—it is a debate on its own—except to say that I agree with all the concerns expressed. We have seen great improvements over the past 20 years; they are well known to everyone. Equally, everyone realises that we need to continue those improvements and do the same
  1534
  again over the next 20 years. That is what will be required to attract the jobs that will bring Wales back to being one of the leading economic areas of Europe.
  Praise was lavished on various government agencies. I was pleased to hear that from the other side of the House. My noble friends Lord St. Davids and Lord Griffiths and the noble Lord, Lord Elis-Thomas, and others praised the Welsh Development Agency, a creation of the Benches opposite which has been lovingly cared for by this side of the House as well. Since 1979 it has provided over 17 million square feet of factory space and has spent in excess of —780 million on property development activities. It has a solid foundation of success on which to build. It will continue to develop its role as an enabler rather than as a direct provider, concentrating its effort on filling gaps in the market. It will also continue to play a central role in the promotion of inward investment and, through its capital programmes, will support local authorities' strategic development plans.
  A number of other agencies have achieved notable successes. The Cardiff Bay Development Corporation has been mentioned. I do not want to go into the question of the opera house. I am a great fan of Welsh Opera. As part of its tour it visits Southampton which is close to where I live. I am also a great fan of Welsh rugby—except perhaps next Saturday. I do not wish to try to judge between the rival claims on the Millennium Commission.
  The Development Board for Rural Wales was praised by the noble Lord, Lord Geraint. Other agencies and partnerships were mentioned. My noble friend Lord Aberdare mentioned the Cynon Valley business partnership. I believe that between them the multifarious agencies of national and local government and the local partnerships between them and industry have been one of the great successes of the Welsh economy and one of the reasons why that economy has shown such good performance over the past 20 years.
  Tourism is one of the main industries of Wales. It is an old industry which now accounts for 9 per cent. of the Welsh labour force. It is a growing industry but not at any great speed. It is growing at about 5 per cent. a year. However, for a long time it will be one of the foundations of the Welsh economy. My noble friend Lord St. Davids says that it needs fresh emphasis and has to go up market. The noble Lord, Lord Williams, says that its activities are seasonable; perhaps that illustrates one of its main problems.
  The Wales Tourist Board and the Government will continue to give the tourist industry all the support that they can. The 1999 Rugby World Cup will obviously be a major tourism opportunity, but it is even more importantly one of the best opportunities that we shall get for promoting Wales's image. In the light of that unrivalled opportunity, the Wales Tourist Board has launched a major new —2.5 million marketing campaign to promote the image of Wales, and its budget has been increased by more than 30 per cent. over the past five years.
  Much mention has been made of the new councils which come into full existence on 1st April. Many noble Lords are concerned that the new councils should be

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  resourced adequately. That is the Government's concern also. Overall, authorities' spending will be 3.1 per cent. more in 1996–97 than in 1995–96. The support they will be receiving from the Welsh Office will be increased by 2.2 per cent. That reflects the Secretary of State's view that local authorities should raise more of their own resources. The Secretary of State announced yesterday a further £15.9 million for the authorities to limit council tax increases in some areas. That is further evidence of the Government's concern that this should be a successful transition from one set of authorities to another.
  I do not want to stray into the areas of disagreement on economic policy which exist between us and the parties opposite. They are well known and would be out of place in a debate which has shown how much we all value Wales as part of Great Britain and how much we all share in the celebration of its economic success and hope that that will be continued for many years to come.
  8.51 p.m.
  Viscount St. Davids: My Lords, I never cease to be amazed at how diverse in debate my fellow countrymen can be on a single subject. Tonight's debate has much of importance for my right honourable friend the Secretary of State to ponder. I hope that my noble friend Lord Lucas will ensure that a copy of Hansard will follow him home for the weekend.
  It remains for me to thank all noble Lords who have taken part in the debate; the noble Baroness, Lady White, for promising me another Christmas so soon after the last; and my noble friend Lord Lucas for winding up a debate which may, at times, have seemed strangely foreign to him. I beg leave to withdraw the Motion for Papers.
  Motion for Papers, by leave, withdrawn.

  Party Wall Bill [H.L.]
  8.52 p.m.
  The Earl of Lytton: My Lords, I beg to move that the Bill be now read a second time.
  As this is a maiden voyage in sponsoring a Bill in your Lordships' House, I would merely ask for your Lordships' customary indulgence towards the novice. Noble Lords may be aware that I am a chartered surveyor in private practice, and therefore it will be of no surprise that I have some small professional involvement in the matter of party walls and thus a contingent pecuniary interest to declare in the matter of the Bill by virtue of my profession.
  Before I go any further there are a number of people to whom I must express my thanks: the Department of the Environment Building Regulations Division which flagged a number of technical points and which has been of great value in fine tuning some of the thoughts on the Bill; the Building Regulations Advisory Committee which scrutinised early drafts, without which the form of the Bill would not be in its present state; the Royal Institution of Chartered Surveyors for its help and
  1536
  support; the working party of professional people who scrutinised all sorts of detail; and, last but not least, that philanthropic gathering of party wall surveyors known as the Pyramus and Thisbe Club, named after the characters in Shakespeare's A Midsummer-Night's Dream who met through a chink in the party wall.
  I have a client in Sussex in a case that received recent media attention. She would have been saved 10 years' anxiety, and there would have been a saving of tens of thousands of pounds in costs but for the fact that there is a legislative void. There are other cases which I can supply to any noble Lord who is interested which illustrate the problems that arise. They represent but the tip of an iceberg.
  Party walls have a long and cherished history, but in this country the watershed was undoubtedly the Great Fire of London, followed by the London Rebuilding Act 1667. There were further Acts and some consolidation under the London Building Act 1894. Changes continued, and there was a further London Building Act 1930. That again was amended in 1939 under the London Building Acts (Amendment) Act. It is those two 1930s Acts which form the current basis upon which party wall surveyors act in Inner London.
  There are thousands of cases a year, and very few unresolved disputes, even to a third party surveyor and even fewer to a court of law, and usually on some other complication. That is a remarkable success rate.
  Outside Inner London the general law on party walls is derived from the Law of Property Act 1925. Briefly, that means that an owner can do anything to his own half of a party wall, and therein lies the problem. Owners carry out works that affect shared structures without reference to their neighbours, but, crucially, that legislation confers no rights to do essential remedial works such as underpinning, or to upgrade deficient structures if the neighbour objects.
  The Bill will have no effect on title. The wall owned by one party or another is not a party wall, nor does it cut across provisions for easements contained in title. It is not designed to affect common law rights of support or conflict with other statutory requirements. But it will not resolve other human failings: dogs, children, trees and personal animosity. All those are things which no legislation can hope to overcome.
  The aims of the Bill are to extend the tried and tested provisions of the London Building Acts to England and Wales. It rests upon a principle of voluntary agreement between parties wherever possible; it provides for notice to be given where works are proposed; there is an opportunity to respond and comment; it sets out to protect existing structures; there is a clear liability for damage and making good; there is provision for the resolution of disputes, other than by going to law; it sets out how costs of works and fees arising from them shall be dealt with; and clarifies the extent of rights over common structures, including floors—that is, floors between different units of occupation. So the Bill is a safety net and not a fiery hoop.
  There have been inevitable changes to adapt local legislation to national purposes. There has been a need to rectify an awkward legal precedent to do with party

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  walls used by only one owner, and it sets out to remedy an anomaly relating to differential treatment of floor structures. Finally, there are improved failsafe mechanisms within the Bill. Otherwise, it is very much as the 1930 and 1939 Acts are at present.
  I turn to the detail. Clause 1 covers proposed works adjacent to a legal party boundary, known in the Bill as the line of junction, which is not already built upon. A building owner who is proposing works serves notice on the neighbour who is known as the adjoining owner. Those owners can agree that the new wall shall be a party wall. They can agree its position, and the Bill provides for the manner in which the expense of building the wall, and its subsequent maintenance, is to be defrayed according to use. But, if there is disagreement, the building owner may only carry out the work at his own expense and on his own land. He must still serve a notice if he wishes to construct up to the line of junction. But he will have certain additional rights, subject to Clause 1(6), to install the necessary minimum projecting footings and foundations under the land surface of the adjoining owner where that is necessary, and subject to safeguards.
  Clause 2 applies where the line of junction is already built upon by the forming of a boundary wall, or the external wall of the building, or, indeed, the party wall between buildings. Clause 2(2) specifies certain rights of the building over. Prior notice of the works is mandatory, but I would like to dwell on a few of those particular rights that warrant special attention. As regards subsection (2)(b), I would point out that it is usually a matter of strengthening rather than demolishing or reconstructing a party wall. But if more drastic action is necessary, the Bill allows for this in the interests of both parties.
  Subsection (d)(iii) provides that all damage to adjoining premises must be made good. This invariably triggers the practice of preparing an agreed record of condition. Subsection (h) provides for the removal of any overhanging portions of the adjoining owner's property to enable a vertical party wall to be erected. That is not as draconian as it sounds, as there may be title to the overhang but, if not, the building owner may still have to make good and compensate the adjoining owner. More typically, the projecting eaves of an adjoining owner's building can be cut away subject to making good.
  Subsection (1) removes an anomalous precedent. It allows the reduction in height of an existing party wall or party fence wall to the extent that it exists primarily for one owner's benefit, but only to the extent that it is not required for any purpose other than a boundary wall. So if a neighbour's building or outhouse uses the wall for support, the wall cannot be reduced in height below that required for that structure. Other rights relate to the insertion of damp-proof courses dealing with chimney breasts and other projections and dealing with structures which are inherently deficient or do not accord with statutory requirements.
  Clause 3 deals with the form and content of initial notices. At subsection (3)(a) it is provided that a building owner can do any Clause 2 work with the
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  adjoining owner's consent. So obtaining consent obviates the need for any further procedures under the Bill. Subsection (3)(b) provides that if the works arise as a result of a statutory notice served on the building owner, there is no need to serve a party structure notice at all; he may proceed to deal with the works as required.
  Clause 4 governs the service of counter-notice by an adjoining owner. He may require the work to he done differently or in a manner which mitigates adverse effects on his property. A building owner must take the requirements on hoard unless they are felt to be unnecessary, injurious to him or otherwise to cause difficulty. In that case the matter is in dispute and is resolved under the disputes process.
  Clause 5 contains the general provisions that if matters are not settled between the parties a dispute is deemed to have arisen.
  Clause 6 covers excavation and construction within specified distances of an adjoining owner's property. These works are regulated by depth, by proximity and by reference to a notional 45" plane extending outwards and downwards from existing foundations. The purpose is to protect existing structures. This clause also sets timescales for dealing with the works, so the building owner must proceed with despatch or start the process again.
  Clause 7 provides for compensation of an adjoining owner for any loss or damage arising out of the works. At subsection (3) the building owner must take proper precautions to protect adjoining land, buildings and people by means such as shoring up and protection from falling debris.
  Clause 8 relates to powers of entry. If the procedures have been followed, an adjoining owner may not unreasonably deny access. Entry may be forced, but subject to safeguards.
  Clause 9 protects existing easements, including easements of light. Clause 10 deals with the resolution of disputes. In this particular instance both parties can agree on the appointment of one surveyor. That is a step to be recommended most strongly, particularly for householders carrying out small works. Alternatively, the parties may each appoint a surveyor. These in turn will nominate a third surveyor who is called in to adjudicate only in the few instances of sustained disagreement. Between them they will produce an agreement or award. Normally a party wall surveyor or third surveyor cannot be removed, but the Bill provides for instances where surveyors are unwilling or unable to act.
  The duty of party wall surveyors is quasi-arbitral. Once appointed they have a duty to act properly in the interests of both parties as statutory surveyors, which is a most important safeguard. Experience indicates that the great majority of disputed cases are dealt with by agreement between surveyors. The building owner generally meets the cost of the adjoining owner's surveyor. But that is not a licence to charge excessive fees and there are generally prior agreements on charges. Safeguards are provided where a party to the dispute neglects to appoint a surveyor, in which case the

  1539
  other party may appoint one on his behalf. There is a fallback power whereby the local authority makes the appointment of a third surveyor on application of one surveyor if there is a breakdown in the normal procedures.
  Clause 11 provides for the payment of cost for the works generally by the building owner who is proposing to carry the works out but also in proportion to the use to which each party puts the wall. Additional subsequent use of a new or altered party wall may trigger the liability for a further contribution. Clauses 12, 13 and 14 refer to securities for expenses, accounting procedures for costs of works and settlements of accounts respectively.
  There is deliberately no means of summary enforcement as it is felt that this could fetter the jurisdiction of the courts. Most owners and adjoining owners in experience thus far discharge their obligations voluntarily. The normal county court procedures remain for cases where they do not. An unappealed party wall award would be strong prima facie evidence that it was reasonable. Experience shows that there are very few complications in this area.
  Clause 15 governs the service of notices. Importantly, if an adjoining owner fails to respond to the initial notice the dispute procedures come into play as a failsafe mechanism. Therefore in future there will be no presumption of agreement by default.
  Clause 16 is self-explanatory and refers to offences and fines, while Clause 17 refers to Crown exemptions. This currently repeats the existing London Building Acts, but my inquiries continue as to whether the Crown wishes to be exempt.
  Clause 18 covers definitions. There is a change in this Bill from the current London Building Acts to make all horizontal structures between flats and maisonettes party structures covered by the Bill, regardless of whether they have separate or communal access. I apologise for paraphrasing in the interests of brevity what is a slightly more complicated issue. The term "surveyor" means anybody acting on behalf of the building owner and adjoining owner or appointed to settle disputes. It could be an architect or solicitor. It could even be a lay person with no technical qualifications.
  Clause 19 and Schedule 2 govern repeals. I think that they are self-explanatory.
  I shall need to move a number of amendments in Committee to remedy a certain number of textual errors and omissions. I shall deal with those at the appropriate time. The effect of the Bill is to assume agreement. It is intended to provide a system which is cost-effective and which offers the cheapest option before it is necessary to move on to more expensive procedures. There are important safeguards and rights for both neighbouring owners. The Bill creates a situation which is more clearly identifiable as a process and which is freer from risk than the rather capricious process of going to litigation.
  I hope that it will be seen that the Bill is worth while and uncontroversial. I hope that it will be seen as something which will encourage good order and create
  1540
  a framework for dealing with disputes. It will reduce risk and be preferable to the litigation of the sort in which my client, and the other cases that have come to my attention, were involved. The Bill dovetails in with the Access to Neighbouring Land Act. I am satisfied that there is no conflict with that. Statutory consents such as planning, listed buildings and building regulations will be unaffected. They will continue to apply as before. However, the Bill will create businesslike relations between neighbours in respect of shared structures, based on established procedures with an excellent track record thus far. I believe that the Bill has industry-wide support and I commend it to the House.
  Moved, That the Bill be now read a second time.—(The Earl of Lytton.)
  9.9 p.m.
  The Earl of Kinnoull: My Lords, I congratulate the noble Earl, Lord Lytton, on introducing his Bill. He did so with his customary skill and clarity in what is a very technical subject. Given the short list of speakers, I have a feeling that only the brave are taking part. I saw no hint of the noble Earl's so-called "novice" approach. Indeed, his performance was the reverse of that. He showed the same robustness and depth of knowledge of the subject that I well recall from his interventions during the passage of the Environment Bill.
  I welcome the Bill. It is timely. In fact, it is long overdue; some may say that it is 300 years overdue. The Bill has great merit in helping those with party wall claims to settle issues that lie close to their hearts; namely, their property.
  At this stage I must declare an interest as a practising surveyor also, but not with the same sharp-end experience as the noble Earl. In fact, this is not a subject with which I have tangled professionally. I leave it to more skilled colleagues.
  I was fascinated by the noble Earl's introduction, as I am sure were other noble Lords, and by his historical references to the long background of party wall claims legislation, and the wisdom of those forebears in London who saw the need for such legislation and guidance. Indeed, the first Mayor of London in 1189 and the Great Fire of London in 1666 were milestones, as I understand it, leading to the current legislation of the London Building Acts, and especially to the legislation of 1939 and 1984. Those provisions applied exclusively to London owners and gave them a procedure of orderly regulations which I believe has worked well in recent times in terms of avoiding untold litigation.
  I am sure that awareness of those procedures has been helped by the excellent green book on party wall procedures which was published by a splendid organisation called the Pyramus and Thisbe Club. The noble Earl paid that club a tribute, to which I should like to add because I know that that club of professionals has done tremendous work. I pay a particular tribute to its chairman, John Anstey, who, like other colleagues, has been active in helping to draft the Bill.
  The question that has crossed my mind—I am sure that it will have occurred to other noble Lords—is why for all these years the rest of us living outside London

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  have been denied the benefits of the London Building Acts. There have certainly been many cases outside London to justify the introduction of provisions such as those contained in this Bill, but we have suffered from a lack of procedures for adjoining owners. One has to remember that disagreement on party wall claims can lead to disputes out of all proportion to the issues involved. Sadly, we have become a very litigious society and it is therefore important that the law should be as clear-cut as possible.
  As the noble Earl said, the Bill largely comprises hones drawn from the tried and trusted London Building Acts. I understand that some modifications have been made, given the benefit of experience of those Acts. Perhaps the most important feature, as the noble Earl stated, is the statutory requirement of the notice procedures by the building owner to the adjoining owner, and thence the choice of agreement direct between owner to owner or with the help of their respective surveyors; or, indeed, perhaps a single surveyor.
  There are two matters which concern me in that context. First, there is the definition of "surveyor" in Clause 18. I fully understand and accept that the word "surveyor" is very much a generic term, as the noble Earl said. I also fully understand that it does not have the meaning of surveyor as we know it—a chartered surveyor, or whatever. Basically, it means a competent or a relevant professional person. However, it does not say that in the Bill. I find that very surprising when we think of the seriousness of the subject. The Bill simply refers to a "person". That person could be either competent or incompetent. I hope that the noble Earl will look at that point in Committee.
  The second matter concerns the authority of the third surveyor. As I understand it, the third surveyor, to all intents and purposes, acts as an arbitrator. He is appointed at the same time as the two surveyors for either side. That is all good, sensible and effective in its simplicity. But, of course, as we know—and, indeed, as the noble Earl said—when the third surveyor is given his award the case does not end at that point. His award can be referred to court, not just on a point of law but on any ground. The award can be overturned and all the good and fair procedures which have taken place are lost, with the accompanying abortive costs incurred. The litigants then face expensive litigation in the courts. I understand what the noble Earl referred to, but I hope, again, that we can discuss the matter in Committee.
  Under Clause 7, which deals with compensation, there appears to be no provision for building owners to pay compensation within a certain stated time, or, indeed, any reference to enforcing a settlement. I expect that I have missed something or there are perhaps some subtle and simple actions that an aggrieved adjoining owner can take. However, I hope the noble Earl will he able to deal with that point either this evening or at a later stage.
  The Bill is limited to England and Wales. Of course, one understands the position in Scotland which has its separate laws. I gather that in Scotland the term used is "mutual wall issues" and that they are almost invariably
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  settled within the title deeds of the property. However, I wonder why Northern Ireland has been excluded from the legislation. Perhaps the noble Earl will also deal with that point.
  My final point relates to Schedule 1 and the level of fines. Again, I am merely asking for information as to how the level of fines has been arrived at. I should also like to know whether the reference to "each day" means each working day. All those questions are for elucidation and in no way dim my enthusiasm for the benefit that the Bill will undoubtedly bring. However, knowing the scarcity of time in another place, it is most important that the Bill should leave this House in its final approved state. I am sure that the noble Earl will ensure that that will happen in Committee. I congratulate the noble Earl once again and wish his Bill a safe passage through both Houses.
  9.17 p.m.
  Lord Dubs: My Lords, I should also like to congratulate the noble Earl. If this is the first time that he has presented a Private Member's Bill, it was not obvious from the way in which he produced it and, indeed, introduced it. We have before us a very complex measure. I am sure that I cannot pretend to understand all the details and the significance of the legislation. But certainly the noble Earl's expertise shows through in the form in which the Bill appears before the House.
  I should also like to thank the noble Earl for the assistance that he has given me. Indeed, he has gone out of his way to give me background information. He has supplied me with a copy of the green book from the Pyramus and Thisbe Club on party walls and has generally made himself as helpful as possible to ensure that, if I had any questions, I should be able to put them to him. If I include one or two questions in my speech, it is because I think that they are more appropriate for resolution in Committee.
  In keeping with the tradition of most Private Member's Bills, there is no party-political view on the matter. Therefore, the comments that I am about to make are personal and I can assure the House that I shall be brief. I should like to give the Bill a warm welcome. I believe that it would establish a most important principle and I hope that it will be successful in achieving the aims intended; that is to say, that the good legislation that prevails at present in inner London or the old LCC area, together with some improvements to the Bill, will apply to the whole of England and Wales.
  I know that disputes between neighbours can he extremely painful. Disputes over party wall matters must be desperately frustrating, if one is outside inner London, as they cause so much agony, so much conflict and so much heartache to people who innocently find themselves in such difficult situations. I am grateful to the noble Earl because this Bill will remedy what I consider to he a wrong which has persisted for a long time. The Bill will provide a better way of resolving these matters relating to party walls in a way which is, incidentally, much more economical for the people concerned. That is an enormous boon for people. Many of the people who will benefit are not aware of that

  1543
  because they have not yet become involved in a dispute involving party walls. Therefore in a sense the Bill will benefit people who may not know of that benefit; that is, if it passes through both Houses.
  Like other noble Lords, I, too, wonder why this situation has persisted for so long. If, indeed, inner London has, as it were, led the way—I do not know the history of the matter as regards why inner London had better legislation regarding party walls—I cannot for the life of me understand why the rest of the country has not caught up. That is a puzzle and perhaps the answer to it will become clearer. Incidentally, one of the delightful things about the book on party walls from the Pyramus and Thisbe Club is the clear way in which it explains the legislation. I do not think I have ever come across such a clear explanation of legislation. Will government departments please copy that? I do not expect government spokesmen to make adverse comments about existing legislation, as the book does, or about the limitations of that legislation, but I must repeat that the book is a model of clarity. It would be nice if government departments were to consider the book to determine how they can emulate this clear approach to explaining legislation.
  I have two specific questions to put at this stage. They do not concern any changes that the noble Earl has made to the existing law. However, he has not made changes in two respects. It seems to me that he has made a number of sensible changes to the London Building Acts in drafting his Bill and therefore I believe it is right to ask, first, why he has not made the two changes to which I have referred. One of them concerns a point which has bothered me for some time. It may not be totally appropriate to this Bill but I shall ask the question anyway.
  Clause 8 gives rights of entry. As I understand it, one of those rights of entry is the right to erect scaffolding on adjoining premises in order to carry out work. I am worried that unless scaffolding is safeguarded at night it could provide easy access for burglars. That point may be covered by other legislation, but all too often I have seen buildings which are an invitation to burglars because there is such easy access to the scaffolding enabling anyone to climb up it at night and enter the buildings. I would not like any property I might own to be made so vulnerable to burglars through the erection of scaffolding. Is there any way in which one could incorporate safeguards so as to ensure that when scaffolding is left at night it is left in a condition which is as burglar proof as possible?
  Up until last June I worked for the Refugee Council and the building where I worked suffered a number of break-ins. The burglars had entered by means of scaffolding that was erected at the junction of our building and the adjoining building. The burglars got up onto the roof and climbed in. However, this is as great a danger for private buildings.
  My other question concerns exemptions from the Bill. This is a substantial point. There is a list of types of buildings which will be exempt from the provisions of this Bill. I note that the types of building appear to be identical to those mentioned in earlier legislation.
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  However, I cannot understand why all these types of buildings should he exempt. It seems to me that every government building—I assume that that includes DSS offices and the like—throughout England and Wales is exempt. The British Museum is exempt and any Metropolitan Police building is exempt. Presumably the buildings belonging to other police forces are not exempt as they would technically be under the jurisdiction of local authorities. The buildings of the Inner Temple and the other Inns of Court are exempt, as are several others.
  I do not understand why that should be the case. If I happened to have a house adjacent to a police station, a DSS office, or a government department, although that is less likely, I would like to feel that if a party wall issue arose I had the same rights as if my neighbour were another private individual. I wonder whether we can clarify that point. I believe that we could delete the exemptions, unless there is some good reason why we should not.
  Having said that, I welcome the Bill. It represents an enormous improvement for people in England and Wales. I hope that it will have a speedy and effective passage through both Houses.
  9.25 p.m.
  Lord Lucas: My Lords, I have listened with great interest to the debate this evening in this House, and in particular to the most informative and accomplished introduction by the noble Earl, Lord Lytton. I am grateful to him for a most lucid description of what is undeniably a rather extensive Bill, at least by the standards of Private Members' Bills.
  As we have heard, the proposed Bill has origins dating back to the Great Fire of London. The Bill is firmly based on provisions in the London Building Act 1939, and, if enacted, would bring legislation that has been in use in London since that time into the law applicable in England and Wales. On the face of it, it would certainly seem to be beneficial to have in place a clear system defining the rights of all interested parties in matters concerning party walls.
  We agree that the Bill does indeed provide a clear mechanism by which those who wish to carry out building work on a party wall are obliged to give notice of the proposed work to the adjoining owner, and to seek his consent. Any measure which seeks to reduce conflicts is to be welcomed. We also note that, should a dispute arise, the Bill clearly sets out the way in which such differences should be resolved.
  As to the detail of the Bill, it makes provision for the rights of different owners concerning the construction of a new wall along the boundary of adjoining properties, and also details the rights of owners with regard to existing party walls. We are encouraged that reassurance is given to the adjoining owner with regard to making good any damage to his property.
  With regard to the service of notices and counter notices, we note that the provisions of the Bill do not preclude immediate compliance with any notice served under statutory provisions regarding dangerous structures.

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  We see that the provisions of the Bill also extend to cases where there is excavation or construction within defined distances from an adjacent property. Further, the provisions seek to protect adjacent owners or occupiers from unnecessary inconvenience resulting from the exercise of any right conferred by the Bill, and make provision for compensation for any loss or damage arising.
  We see that the provisions include, subject to the service of appropriate notice, a right of entry to adjoining property where necessary. It is noted that existing easements are also safeguarded.
  We note with interest the detailed provisions for the resolution of disputes. We recognise that, although there are provisions for the appointment of up to three surveyors for the resolution of any dispute, the term "surveyor" is given a very wide interpretation in the Bill. We are glad that the Bill is not restrictive in this matter.
  It is appreciated that the handling of matters of expenses, and their security, are considered in the Bill together with procedures for accounts and their settlement.
  We note that there are detailed provisions as to the service of notices, a matter pivotal to the Bill.
  We appreciate the noble Earl's comments as to the provisions with regard to exemption for the Crown, and shall be happy to discuss that further with him. I hope that that gives some comfort to the noble Lord, Lord Dubs.
  We are broadly supportive of the principles embodied in the Bill, but we are aware that, as the noble Earl, Lord Lytton, indicated, the Bill needs some improvement in order to make it acceptable to all. I have listened with great interest to the debate today and to my noble friend Lord Kinnoull and the noble Lord, Lord Dubs, and we shall pay close attention to what is said in the forthcoming Committee stage.
  9.29 p.m.
  The Earl of Lytton: My Lords, I am most grateful to all noble Lords who have spoken this evening, in particular for their kind words and general welcome to the Bill.
  The noble Earl, Lord Kinnoull, kindly gave me notice of the queries that he was likely to raise; and I am grateful for that. He pointed, appropriately, to the fact that many disputes between adjacent owners are out of all proportion to the issues. That is the problem which the Bill attempts to address.
  The definition of a surveyor has been given a certain amount of thought. The difficulty is to provide a test of competence in the Bill. I particularly note what the Minister said about the advantages of the provision being open. I am certainly prepared to consider the matter again. However, it raises problems which may not be easily overcome.
  As regards the competence of third surveyors, the difficulties are that there is no arbitration agreement in the Bill. So far as I am aware—I stand to be corrected on the point—there is no way of statutorily enforcing an
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  arbitration agreement through a Private Bill. Inevitably, there is no way of preventing people from having arguments if they are determined to do so because they dislike their neighbour. It is a fact of life. However, I shall consider the issue to see whether anything can he done, although I am a little doubtful.
  On the timescale, as I understand it, the noble Earl referred to payments of costs, expenses and compensation. That is a perfectly legitimate point. It may well be that the provision should he tightened up so it is beyond doubt that payment will he made within a reasonable time.
  I have already covered the point about enforcement and the difficulties about fettering the courts.
  As regards the exclusion of Northern Ireland, I am in some difficulty in answering that. I had understood that at one stage the Northern Ireland Office was considering introducing some measure of its own. It was not felt appropriate to extend the measure to Northern Ireland, but, again, I am happy to consider the matter again.
  On the level of fines, as I understand it, the current practice is to set a fine at a standard rate for the offence. The Bill provides for a daily fine for continuing the offence. I do not totally understand the import of the working day as opposed to the non-working day in terms of the daily accrual of that daily element. Again, I am happy to consider the matter and write to the noble Earl with some further thoughts.
  The noble Lord, Lord Dubs, said some kind words about the Bill; I am grateful to him. He referred to changes that may be required and in particular to scaffolding under the rights of entry provision. All I say in defence of that is that, if an award is properly made, the security of scaffolding should be one of the issues considered by the surveyors on making the award. Obviously that consideration would he paramount in an urban environment where there was a high security risk. Therefore I hope that the issue would be covered by the best possible practice being applied in relation to the perceived risk. I realise that that may not be an entirely satisfactory response to the noble Lord, but I believe that it is probably the answer.
  Exemptions for various bodies, departments, Inns of Court and so on were considered at an earlier stage. I believe that the Bill offers advantages and that the various bodies would welcome being included since it provides a code enabling them to deal with matters which perhaps might otherwise be more difficult. There may have been a natural reluctance to tread on toes by introducing a measure of that kind from existing legislation, although it is local legislation. I plead that in mitigation. But again I am happy to consider that issue.
  I am grateful to the Minister for his comments. He referred to the reduction in conflicts. That must be the nub of the Bill. It is intended to reduce friction and take the heat out of contentious issues. Where parties are able to agree, they can and will agree and nothing in the Bill will prevent them doing so. But where issues arc destined to be contentious it will provide a mechanism for dealing with them.

  1547
  I cannot say why it has taken so long to apply the legislation to the rest of England and Wales, but I believe that there are particularly difficult cases which arise in the country generally. It is a worthwhile Bill and on that basis I commend it to the House.
  1548
  On Question, Bill read a second time, and committed to a Committee of the Whole House.
  House adjourned at twenty-five minutes before ten o'clock.