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Commons Chamber

Volume 884: debated on Wednesday 15 January 1975

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House Of Commons

Wednesday 15th January 1975

The House met at half-past Two o'clock


[Mr. SPEAKER in the Chair]

Private Business

Pier And Harbour Provisional Order (Fishguard And Goodwick Harbour) Bill

Read a Second time and committed.

Oral Answers To Questions




asked the Secretary of State for the Environment if he has any proposals to assist domestic ratepayers whose rates increase by more than 20 per cent. in 1974–75.

I take it that the hon. Member is referring to 1975–76. He was kind enough to ring my private office.

My right hon. Friend the Chancellor of the Exchequer announced in July our measures to help householders faced with rate increases of more than 20 per cent. in 1974–75. I have no plans to repeat those measures for 1975–76.

I am grateful to the Secretary of State for that answer. I apologise for not picking up the typographical error earlier. Since, last year, he said that he was providing a lifeline to the unfortunate ratepayer, may I ask, whether in view of his forecast of a 25 per cent. average increase this year, he will come back to the House if it transpires that the average rate increase throughout the country is in excess of that figure?

There is a major difference between this year and last year. Last year's original Conservative Government's rate support grant settlement provided local authorities with £3,430 million which paid for 60½per cent. of the reckonable expenditure. This year the Labour Government's rate support grant settlement has provided £5,430 million—£2,000 million extra—which will cover 66½per cent. of local government expenditure.

Will the right hon. Gentleman answer the question put to him by my hon. Friend? Does he stick to his forecast that rates will on average go up by only 25 per cent., or has he any modification? If the rates go up by more than that figure, will he come forward with extra help?

I have no modification to make of that forecast, which was based on an important condition that I have always underlined. The figure is good if, and only if, local authorities keep within the totals of expenditure agreed between them and Government. The point about another relief operation next year is that if this kind of relief were to become an annual event local authorities would be strongly encouraged to set their rates as high as they liked in the certain knowledge that the Government would bail out their domestic ratepayers.


asked the Secretary of State for the Environment what proposals he has for giving relief in 1975–76 to domestic and commercial ratepayers in areas of special difficulty.


asked the Secretary of State for the Environment if he will make proposals designed to ensure that no undue rate burden falls upon small shopkeepers.

The House has already approved my right hon. Friend's proposals under which our ratepayers, both domestic and non-domestic, in all areas, will benefit from the unprecedentedly generous rate of grant to be given for 1975–76 and the special increase which he has made in the grant for 1974–75.

Will the hon. Gentleman accept our congratulations that his party has now, through the evidence it has given or will be giving to the Layfield Committee, accepted the proposal which started on the Conservative side of the House that teachers' salaries should be paid by the Government? Would it not have made a great deal of difference and saved a great deal of time if, instead of criticising our proposal during the election, the Labour Party had accepted it?

It was not specifically that proposal to which we objected. It was the proposal put forward by the right hon. Member for Finchley (Mrs. Thatcher) to abolish the domestic rating system without any idea of what was going in its place.

Is the hon. Gentleman aware that in the part of Lancashire which includes my constituency serious fears have recently been expressed by responsible people like local councillors that the increase in the rates for 1975–76 is likely to be in the region of 80 per cent.? Is the hon. Gentleman further aware that a large part of my constituency is made up of farming land with a paucity of industrial development? The result is that any rates increase will fall largely upon domestic ratepayers and local shopkeepers who can ill afford such increases. Can the hon. Gentleman say—or, better still, do—something—[HON. MEMBERS: "Too long."]—to assuage the anxieties of these people and give them some assurance of future solvency?

All areas, including the constituency of the hon. and learned Gentleman, benefit considerably from the increase the Government have given in this year's rate support grant. If the hon. and learned Gentleman is arguing in favour of agricultural derating because his is an agricultural area and there is a heavy burden on the domestic ratepayer, perhaps he will submit that view to the Layfield Committee.

Will my hon. Friend accept my congratulations and those of the ratepayers of Sandwell metropolitan borough for the generosity of the 1975 rate support grant? Can he also find a few words of sympathy for the ratepayers of the Midlands generally following the increase of 40 per cent. in the water rate for 1975–76 which, together with an increase of 60 per cent. in the current year—[HON. MEMBERS: "Too long."]— means a total increase of 100 per cent. since the creation of the—

This makes a total increase of 100 per cent. since the creation of the Severn-Trent Regional Water Authority—another body created following the reorganisation of local government by the Conservative Party.

The West Midlands area did very badly last year, even when in his "rough justice" speech my right hon. Friend changed the amount of grant to the West Midlands—Sandwell particularly. This year I am delighted to say that the area has done much better. There are problems with regard to water, particularly water from Wales, which my hon. Friend's constituency receives, and this matter is currently being looked at by my right hon. Friend.

Housing Land


asked the Secretary of State for the Environment if he will invite local authorities to designate land specifically for system-built low-cost housing.

I will consider this suggestion in the light of the review of low-cost housing.

Is the Minister aware that many local authorities are sitting on colossal land banks and are behaving like misers with this valuable asset? By securing the release of this land the Government would be seen to be tackling the housing crisis and helping the housing problem this year.

I am probing several instances of local authority-held land which could be brought into housing programmes more quickly. I should welcome any information from the hon. Gentleman in support of his general statement, and should be glad to probe the possibility of bringing the land more quickly into housing use.

Will the Minister also look at the question of holiday camps changing over to self-catering establishments? Purpose built chalets of 500 ft. super with two or three bedrooms could be used for permanent occupation if the present planning restrictions were removed. Some chalets are allowed to be occupied for 364 days but others require a break of up to 11 weeks.

That situation and its implications fall to be dealt with by the working party which we have set up under the chairmanship of my hon. Friend the Under-Secretary of State to look into a variety of questions concerned with mobile residential sites. Any information and ideas on these matters will be welcomed by the working party.

Transport Expenditure


asked the Secretary of State for the Environment what principles he applies in deciding the level and distribution of local transport expenditure for transport supplementary grant in each county for 1975–76.

The matters I took into account are explained in the decision letter sent to all counties. I have sent a copy to the hon. Member and arranged for copies to be placed in the Library.

In view of the sparsity of public transport in rural areas such as Cornwall, does not the Minister agree that there is a need for the Government to introduce measures designed to widen the whole basis of the transport supplementary grant support so that a more flexible local transport system can be evolved?

It is open to all county councils to make grants to maintain rural transport. Unfortunately many of them have not done so. Those that have done so receive an allocation for that purpose under the transport supplementary grant arrangements. I agree that the structure of the TSG is far from satisfactory, but I am bound by the statutory provision enacted by the Conservatives when they were in government.

Will the Minister confirm that TSGs should not be used to subsidise fares?

The hon. Gentleman should know, perhaps even better than I because he was there when this was worked out, that the moneys are paid to the local authorities, which have great discretion in spending that money. It is entirely a matter for the local authority how the TSG is spent.

Roads (Construction And Repair)


asked the Secretary of State for the Environment if he will seek powers to assume responsibility for all road construction and repair including secondary roads which are at present the responsibility of county councils.

Is the right hon. Gentleman satisfied that the stringent priorities which the economic situation compel for the national road programme are applied also to the maintenance and improvement of secondary roads? Is he aware that there are many instances where men, materials and money for road building are being applied to relatively minor roads when they might much more usefully be applied to long overdue major road programmes, such as the A55 running through my constituency?

Central responsibility for the maintenance of all roads would not necessarily lead to more money being made available. If, as the hon. Gentleman argues, the central Government were responsible for the maintenance of the 210,000 miles of roads in the country, that would be contrary to the generally accepted proposition that local authorities should have more powers of decision in transport matters, which differ so markedly from one area to another.

Is my right hon. Friend aware that where he is responsible for road construction he also has a duty to maintain the existing network of footpaths? Is he further aware that in my constituency there is grave disquiet about the effect of the Ripley bypass project on local footpaths? Will he undertake to investigate speedily the cogent arguments put forward on this subject by my constituent, Mr. Turner?

I confess that I do not have with me a clear indication of my hon. Friend's constituent's views, but I will refresh my memory on the matter and write to my hon. Friend.

Freight (Carriage)


asked the Secretary of State for the Environment how he intends to implement his policy of transferring freight from road to rail.

I have initiated discussions between British Rail and about 100 of the country's largest firms to encourage greater use of rail. There will also be grants under Section 8 of the Railways Act 1974 towards the provision of private sidings.

Do the Government intend to implement the quantity licensing provisions of the Transport Act 1968? If they do not intend to use those provisions, will they amend the Act by removing them?

Those provisions cannot be brought into effect without regulations being made. The hon. Gentleman will realise that several years have elapsed since the 1968 Act was passed and that no steps were taken to that end when there was rather less parliamentary business than there is this Session.

That answer is not satisfactory. In my area certain rail services were closed down at a time when my right hon. Friend was encouraging companies to transfer traffic from road to rail. The only way to get an efficient integrated transport policy is to implement the quantity licensing provisions in the 1968 Act.

I am aware of the difficulties to which my hon. Friend refers, and which have a bearing in my constituency as well as in his. I have had discussions with the National Freight Corporation, Freightliners and hon. Members on this subject. That situation would not be remedied by the implementation of quantity licensing.

Will the right hon. Gentleman also consider the possibility of transferring a certain amount of freight to the canals, where construction costs are very much cheaper than they are for road or rail?

I should certainly welcome every opportunity to put freight on to waterways where that can be done with reasonable economy.

Although we have been great supporters of the internal combustion engine, will my right hon. Friend ask his right hon. Friend the Secretary of State for Industry to review the enormous sums which are currently being invested on capital account in the railways and consider whether it is necessary to increase the number of trains on inter-city services, many of which are running half empty, and to invest a further £100 million in the advanced passenger train so that we can get from A to B 30 minutes faster?

It is right that the railways should be encouraged to continue their work on the advanced passenger train, and I have authorised some prototypes. In my discussions with the Railways Board, however, I stressed that we are also concerned with commuter, freight and other rail aspects. I will convey my hon. Friend's view to the Chairman of the Railways Board. They are his responsibility and not that of my right hon. Friend the Secretary of State for Industry.

Development Land


asked the Secretary of State for the Environment whether he will now abandon the proposals for taking development land into community ownership in view of the fact that local authorities have submitted to him the opinion that the proposals will delay house building.

No, Sir. No local authorities have submitted to me the opinion that the implementation of my proposals will delay house building.

Has the right hon. Gentleman seen the reported opinions of the Greater London Council, among other local authorities, and the views of a wide variety of respected commentators who have expressed this worry? Is he aware that the White Paper is already delaying the forward housing programme because of its effect on land acquisition and on planning by builders which is necessary if they are to have a continuous programme?

I have seen the reported views of the Greater London Council on this matter and perhaps I could quote the council's actual views as stated on 12th December. The council said that it

"welcomes the objective of providing the opportunity through land ownership for more positive planning in housing as in other forms of development".
On the more general part of the hon. Gentleman's supplementary question, he greatly underestimates the extreme care taken in these proposals not to introduce measures or arrangements which would affect the house building programme. That remains an absolutely firm objective of the Government.

Will my right hon. Friend confirm that last weekend the representatives of 600 local authorities took exactly the opposite view from that expressed by the hon. Member for Hove (Mr. Sainsbury) and that their anxiety was in the opposite direction—namely, that public acquisition powers should be obtained by them more quickly and not less quickly?

My hon. Friend is quite right in his account of the conference which we both had the pleasure of attending. He is also right to say that from many quarters the criticism is the opposite one—namely, that in the transitional period we have made concessions to private builders to protect the house building programme which go too far. Personally I do not think they have gone too far, but nevertheless it is right to bear in mind that there is also that opposite criticism.

Will the Secretary of State say what additional recruitment will have to be made by local authorities in town planning, valuation and legal departments to implement these proposals? What estimates has he made of the additional rate burden which will fall on the nation because of such recruitment and the additional office accommodation that will be required?

There will, of course, have to be additional recruitment, as we have made clear, though I cannot put a quantitative figure on it. This necessity is one of the reasons for our having made transitional provisions in the White Paper proposals.

As for the second part of the hon. Gentleman's supplementary question, I wish to underline what I have said on many occasions—namely that, taking a reasonably long-term view, these proposals will not cost the community something but will be of enormous financial benefit to the community.

Ports (Nationalisation)


asked the Secretary of State for the Environment if he can now say when he intends to introduce legislation to nationalise the ports; and if he will make a statement.

Which of the ports now run by public bodies does the Minister hold up as examples of efficiency, good labour relations and quick turn-round? Is he aiming to try to make Felixstowe as efficient as Liverpool? Will he ensure that before he does anything he will undertake full consultations with those who are now working in ports operated by free enterprise compaines?

I am having consultations on a general rather than a selective basis. Those who represent workers in Felixstowe will be included in the consultations, along with those who represent workers elsewhere. If the hon. Gentleman took the trouble to look at Southampton as an example of a publicly owned port—and I can think of other examples—he might take a different view. But perhaps this is not a suitable occasion on which to conduct a Second Reading debate on a Bill which necessarily is not yet ready.

Will my right hon. Friend bear in mind that the British Transport Docks Board has a long history of remarkable success? As a result of recommendations made over many years to ensure accountability to the public in respect of nationalisation, should we not project this example? Does my right hon. Friend agree that the process should be undertaken in such a way that the maximum amount of discussion will be brought to an end at a reasonably early stage to enable nationalisation of the ports to be brought about in the national interest?

I endorse my hon. Friend's view about the operation of the British Transport Docks Board and the other publicly owned ports. I have always made it clear that, if I am to have the wide consultations that I deem necessary, it will not be practicable to introduce a measure this Session. Furthermore, the House will appreciate that in any event the Government have a rather full programme in the present Session.

Will the Minister undertake to leave well alone one port in particular—that is, the municipally owned port of Boston in my constitutency, which is and has for years been free from industrial trouble and is growing in importance to port users?

In my original consultation letter in August I made clear what was intended. The final phase will arise after consultations are carried out. Where a port is municipally owned, we do not intend to bring about any change of ownership.

Will my right hon. Friend bear two matters in mind? First, does he appreciate that it will require little effort to introduce legislation of this sort, because in a previous Parliament similar legislation passed all its stages in this House and was defeated in the Lords, and then came the General Election and we had to start the process all over again? Secondly, will he bear in mind that all workers in the docks are in favour of complete nationalisation of ports?

I am afraid that the matter is not as simple as my hon. Friend suggests, because in 1970 the proposal was to take into public ownership only those ports handling a tonnage of more than 5 million tons per annum. Because of developments since that date, we believe that it is now essential to bring into a form of public ownership all commercial ports and cargo-handling activities. The ports legislation in 1970 was complicated enough, and our proposed legislation will be much more complicated.

Motorway Programme


asked the Secretary of State for the Environment if he will announce the motorway projects that are now to be abandoned; and if he will introduce measures to end blight in those areas affected.

The programme has already been reduced substantially and I have no plans to cut it further at present. Priority will continue to be given to schemes which will take heavy traffic out of towns and villages. I am very conscious of the problems of blight and everything possible is being done to minimise them.

Will my right hon. Friend accept my congratulations on abandoning the Aire Valley motorway scheme? Will he also accept that many of my constituents in the Stockbridge area of Keighley hope that his new proposals will end blight in the area? Now that the scheme has been abandoned, will the Department put back on the market houses and property which it has bought so that areas which have been blighted can gain confidence?

I am grateful for my hon. Friend's kind words. In this office one gets all too few commendations. It is right in the present situation that the road scheme in my hon. Friend's constituency should be an all-purpose scheme and not a motorway. However, such a decision will take several months since we must work out a detailed line, although we are moving as quickly as possible. When there is no need to protect a line because of a change of policy, we would not wish to maintain properties which we have had to acquire. I shall be glad to discuss with my colleagues whether such properties should be sold or retained as part of the local authority housing stock.

Is the right hon. Gentleman aware that a year has elapsed since a public inquiry took place on the Archway Road widening scheme in my constituency and that despite numerous requests for a determination by the Department of the Environment none has been forthcoming? Is he also aware that major problems of personal hardship will now arise as a result of blight because of delays and the running down of the district and that there is mounting public anger? Will he give an assurance that we shall be given a decision one way or the other by the end of the month?

A great deal of blight occurs as a result of public participation exercises and is an inevitable consequence, although of course it is desirable that there should be the maximum public participation. However, if the public are given the choice of four or five routes and additionally are invited to suggest other alternatives, blight is bound to be caused while a scheme is being considered. I will certainly look at this particular scheme. If I made a decision within a year, it would be much faster than any such decisions by the previous Government, as I had occasion to point out from time to time.

As the Government are rightly looking for economies in public expenditure, and as motorways represent one of the few forms of expenditure to which there is a great deal of public opposition, would it not be wise for the Government in present circumstances at least to postpone all new motorway schemes until the economic situation has improved?

I think my right hon. Friend is unaware that the trunk road and motorway programme is now running at about 40 per cent. below what was forecast two years ago and that similarly local authority expenditure on roads is about 40 per cent. below what was forecast. It would be wrong to give the impression that we should not continue with the road building programme, because in many instances the economic and environmental benefits from those roads are considerable. Indeed, to implement all the requests that I receive in a month from my hon. Friends would take my allocation for a year.

Railways (Reopened Lines)


asked the Secretary of State for the Environment how many railway lines have been reopened in each of the past five years; and how many proposals he is currently considering.

Two in 1970, one in 1972, three in 1973 and one in 1974 were authorised for reopening as light railways. In addition the Railways Board reopened their Peterborough-Spalding line in 1971. There are two other current proposals.

Does my right hon. Friend agree that that is a sad record in view of the considerable need to improve public transport? Does he accept that if urgently required railway lines, such as the Walsall-Cannock-Rugeley line, are to stand any chance of being reopened, we cannot depend on local authorities or British Rail but that there must be additional Government money? Does he agree with many hon. Members on this side of the House, who do not accept the cry to reduce public expenditure, that there is an urgent need for a considerable injection of Government capital into British Rail?

I note my hon. Friend's views about there being no need to reduce public expenditure. Unfortunately I have to work out my programme from instructions which come from my right hon. Friends who think that there is a need to reduce public expenditure. I have every sympathy with my hon. Friend's interest. This kind of proposal must come from the local authorities and/or the Railways Board. Under the Railways Act, which we enacted last Session, I shall be required to find between £300 million and £400 million for revenue support for the railways under the new system.

Is the Mid-Hants railway, the so-called "Watercress line", one of the two proposals currently under consideration?

I am not sure whether that question should be addressed to my right hon. Friend the Minister for Agriculture, Fisheries and Food. The two proposals which are currently under consideration are the Taunton-Minehead and Sheringham-Weybourne lines.

In view of the need, even at this late date, to try to repair some of the vandalism of the Beeching era, may I ask whether my right hon. Friend agrees that it is a mistake for British Rail in any area to sell off assets, to demolish station buildings or to remove the track bed or embankments of railways closed in the past which may very likely need to be reopened in the near future?

It is difficult to make a blanket statement. My hon. Friend says that it is a question of whether they are likely to be reopened, and that is the kernel of the argument. It must remain largely a matter for British Rail. I accept the great importance of British Rail, but I am rightly under strong pressure to do even more than we have been able to do to support road passenger public transport as well.

In view of the further closures which are being announced by British Rail—for instance the Bridport-Maiden Newton line, which is now to be closed in May, and the Alton to Holtwhistle line at the same time—will the Minister take action to ensure that the lines do not close, particularly in view of the problems facing people in rural areas anyway?

In the summer I cancelled the proposed closure of a considerable number of lines, but on economic considerations I did not feel justified in continuing the subsidy on the Holtwhistle line. Perhaps the hon. Gentleman will let me know about the other line. I am not at the moment aware of the current position on that one, because closure proposals emanate from British Rail.

Public Transport Services


asked the Secretary of State for the Environment what effect he expects the increases in petrol prices to have on demand for public transport services.

Does the Minister accept that the brevity and ineptness of his reply will cause widespread dismay to users of public transport throughout the country? Rural services are already in disarray and inadequate for their purpose. We have a situation where we understand—

May I ask the Minister to review the system of public passenger transport licensing to satisfy himself that we are making the fullest possible use of all the resources available?

I am surprised that the hon. Gentleman should think that the words I uttered a few minutes ago should already have caused widespread concern thoroughout the country. That depicts that the state of our communication is rather better than I had believed. I accept that the inadequate provision of public transport is a serious matter and I shall be pleased to do anything I can to remedy the situation. However, I stress that even when more power is given to local authorities to determine these matters and to make grants to the National Bus Company or to subsidise services and so on—we did not contest the principle—all too frequently they are unwilling to do this. Therefore, it is not wholly a central Government matter. Apart from finding money, which I find a problem these days, if I can help the hon. Gentleman's constituency perhaps he will let me know.

Does my right hon. Friend agree that the only logic in having a 25 per cent. rate of VAT on petrol is to reduce the consumption of petrol, and that he ought to be going much further in his cuts in the motorways programme so that existing scarce resources can be bolstered by the additional money for public transport services?

I hope that the package of fuel measures announced by my right hon. Friend will have the effect of substantially curtaining the demand for petrol. Indeed, my right hon. Friend and I were criticised because our measures did not go far enough. We are reforecasting the traffic requirements for the road programme in the light of the expected decline in mileage, particularly of private cars.

Does the Minister accept that the threatened increase of 50 per cent. in bus fares, due to wage demands on the public bus companies, will curtail the demand for public transport?

The hon. Gentleman has the advantage of me. I do not know about a 50 per cent. increase in bus fares. Certainly this would not be general. I accept that increases in fares have a bearing on demand. The most crucial thing is for public transport, wherever possible, to improve the reliability of the service. That has a greater bearing on attracting people from private cars to public transport than the level of fares.

Gipsy Sites


asked the Secretary of State for the Environment what plans he has in connection with the number of authorised sites for gipsies and other travelling people in England and Wales.

As already announced, my Department has appointed an advisory officer whose main task will be to assist local authorities to tackle this problem. There will be discussions as soon as possible with all the local authorities in the main problem areas.

Does not my hon. Friend agree that it is appalling that there are still not enough authorised sites to provide for the existing gipsy and travelling population? In these circumstances, does he not accept that there is an urgent need for legislation to compel local authorities which are not yet providing sites to act, so that the gipsies do not continue to be harassed and the authorities which are playing their part are not forced to do the work also of those authorities which are not?

I agree that this is a problem. There are now 117 official sites in England and Wales accommodating 1,700 families, but well over 3,000 families have still to be accommodated. I do not know whether legislation is the answer. There is legislation already, and I would remind local authorities that the Act places a statutory duty upon them.

Is the hon. Gentleman aware that in the long term gipsy problems will not be solved except in an atmosphere of good will on the part of the gipsies and of the communities in whose areas gipsy problems exist, and that judging from my constituency this will not be achieved by the bulldozing methods available under the statutory powers of the Caravan Sites Act? Is the hon. Gentleman having advice from his newly-appointed advisory officer on these problems?

Yes, that was one of the main reasons for his appointment. We hope that he will bring to the attention of authorities the best practices of other authorities and that he will have the support and respect of the gipsy population and of local authorities.

In view of the serious neglect by many county councils of their duties under Section 6 of the Act, does my hon. Friend consider that he should now himself, without further legislation, use his power of direction under Section 9?

We consider the use of that power from time to time but we much prefer local authorities to tackle this problem on their own, rather than risk what the hon. Member for Ludlow (Mr. More) mentioned, with the Department intervening and creating even greater disharmony with the local authorities concerned.

Is the Minister aware that one of the biggest sources of anxiety is that some authorities play their Fart and provide the places, but neighbouring authorities do not and thereby put greater strain on the good authorities? Is his adviser a gipsy, as it were, or a civil servant, as it were?

The adviser is certainly a civil servant; I have no idea of his racial origin. What the hon. Gentleman mentions is one of the things that the adviser will be doing, pressing on local authorities which are not providing sites and which are in problem areas just how unfair they are being to neighbouring authorities.

M16 Motorway


asked the Secretary of State for the Environment when he expects the public inquiry into the routing of the M16 to be completed; and what is the programme of its construction.

The public inquiry into objections to the proposed route of the M16 between the A10 and the A12 is unlikely to be completed for several months. Subject to the satisfactory completion of the statutory processes and the availability of funds, work on this length of the motorway could begin in mid-1977, with completion two years later.

Has the Minister received any complaints concerning the conduct of the public inquiry? Should any such complaints be addressed to him or to the inspector?

I think that there have been complaints, but the conduct of the inquiry is in the hands of the inspector. I believe that one or two objectors were talking of applying to the High Court, but so far as I know they have not followed that up.

Is my right hon. Friend convinced that the public inquiry is legal in every respect? Certain objections have been made in this locality, where there are strong objections to the motorway itself, that the inquiry was not being conducted in a fully legal manner.

I am advised that the statutory requirements were met in all respects, but if the relevant schemes for this length of the motorway are eventually made there will then be an opportunity for anyone who wishes to do so to challenge their validity in the courts on the grounds that they are ultra vires or that the law has not been complied with.

National Housing Finance Agency


asked the Secretary of State for the Environment if it is still the Government's policy to create a National Housing Finance Agency; what its functions will be in relation to first-time house buyers; and what its relationship to the building societies movement will be.

I would refer the hon. Member to the reply given to the hon. Member for Melton (Mr. Latham) on 2nd December 1974.—[Vol. 882, c. 388.]

In view of the continuing recession in house building, as evidenced by the latest figures, would it not be a particularly good idea to get the market moving at what I might call the bottom end? Would not the provision of preferential mortgages for first-time buyers be a real step in that direction? Finally, how long after the General Election promise of the Labour Party to assist these people will we have to wait for it to be realised?

This Government have already given enormous assistance through the £500 million loan to the building societies, as a result of which mortgage lending is now running at a monthly rate about double what it was before the loan. However, I agree with the hon. Gentleman that it is crucial to get the market moving at the lower end. That is why, on top of the £500 million loan and despite the much healthier flow of mortgage finance now as compared with a few months ago, I am discussing with the building societies and the builders what additional steps we might take to achieve the end in view.

Does my right hon. Friend recognise the truth of the old Lancashire saying "There's nowt so safe as houses"? Will he therefore propose to the building societies that they grant 100 per cent. loans, as many local authorities already do? This would do more than anything else to get the private house market moving.

I take my hon. Friend's point, which has been much discussed. However, having studied the question of what are the real limitations on the lower end of the market, I have become more and more convinced that it is not the lack of 100 per cent. mortgages, it is not the 11 per cent. interest rate or the size of the deposit, but is the general state of uncertainty created by the world economic situation. If people cannot see in what sort of job or position they are likely to be a year from now, they are reluctant to take on the risk of buying a house.

Rate Support Grant (Dorset)


asked the Secretary of State for the Environment whether he can now say what rate support grant for 1975 will be available to the Dorset County Council.

Complete details of the factors to be used in the grant calculations are not yet available. However, an estimate based on provisional information indicates that Dorset County Council's 1975–76 entitlement to the needs element of the rate support grant will be in the region of £24·2 million. In addition the county precept attracts indirectly some benefit from the resources element.

To help both domestic and commercial ratepayers, will the Minister take further action to reduce local authority expenditure, in particular by transferring to central Government the full cost of teachers' salaries? Will he also call a halt to unnecessary expenditure on road development, much of which is causing widespread anxiety and upheaval in my constituency?

The first part of the hon. Member's question relates to a subject which is being considered by the Layfield Committee, but of course that will not I can only emphasise again the provisions affect next year's rate. As for expenditure, of the circular issued on 23rd December, to which my right hon. Friend has referred today, which urges on all local authorities the essential need to contain their expenditure this year to inescapable commitments.

Was the Secretary of State for Education and Science speaking on behalf of the whole Government when he said that it would be a retrograde step to transfer teachers' salaries in the way my hon. Friend suggested? If so, will the Minister take it from us that we strongly disagree with his right hon. Friend?

As I said, this is being considered by the Layfield Committee. Certainly it would not be considered for this year.

Lorry Parks


asked the Secretary of State for the Environment what proposals he has for establishing a network of lorry parks.

I am considering what more can be done to bring about the establishment of a network of lorry parks following a recent meeting in my Department of those concerned.

Does the Minister agree that it was always an urgent necessity to have more lorry parks but that it has now become all the more urgent because of his recently announced decision to curtail motorways and other major roads, which means that lorries will continue to use unsuitable streets and will have to be parked at night in residential areas? Will he therefore try to get a move on in establishing this important chain of lorry parks?

I agree that it is desirable to make progress on the national network, but there have been initial difficulties in getting suitable sites. More recently there have been doubts whether such a scheme could be commercially viable. As regards parking in residential streets, I remind the hon. Gentleman that local authorities have extensive powers. I understand that within his constituency the local authorities concerned, Enfield and the GLC, are looking at various schemes.

Is my right hon. Friend aware that, far from providing new sites, there is an attempt on the part of many local authorities to curtail existing lorry parks? They are turning them over to private residential car parks and forbidding the parking of lorries. There is hardly any point in introducing restrictions on drivers' hours if one makes them drive longer distances to find somewhere to park for the night.

If my hon. Friend will let me know of any particular difficulties, I will see what I can do. I stress, however, that local authorities are entitled to make decisions for themselves in matters within their jurisdiction, and this would appear to be such a category.

House Purchase (First-Time Buyers)


asked the Secretary of State for the Environment what progress he has made in his discussions with the building society representatives concerning new initiatives to help young people to buy their first homes.

My right hon. Friend hopes to make a statement very shortly about the discussions he has had with building societies and builders about the present unsatisfactory situation in private house building, including the position of first-time buyers.

Does my hon. Friend agree that in place of that statement it might be better to produce a White Paper so that the House may have an opportunity for a debate? Will the statement or a White Paper include reference to the provision of timber-frame buildings—about which I made representations to my hon. Friend a little while ago—because there are hon. Members on both sides of the House who, having seen such houses, appreciate that they have many advantages, not least the cost advantage?

The point my hon. Friend raises will not fall to be dealt with in the statement to which I have referred, but I hope that soon afterwards we shall be sending out circular advice which would cover that particular point about building construction. I shall consider with my right hon. Friend the suggestion about incorporating any ideas we have on these matters in a White Paper, though I think that it would be better to await the contents of the statement before we pursue that idea further.

Will the statement include any reference to policies to help the homeless, the figures for which have doubled under the present Government's housing legislation?

I find myself at a loss for words to deal with the last point in that question. I had better ignore it because it was so ridiculously inaccurate. The question of tackling aspects of homelessness is being studied very vigorously. I suspect that it is being studied a good deal more vigorously than was the case under the previous administration.

Will the Minister, in any further discussions, urge building society representatives to explain to young couples that, whichever of them takes the mortgage, it is perfectly in order for the ownership to be in the joint names of both husband and wife?

I should hope that it would not be necessary for me or my right hon. Friend to have to explain that to the building societies. I believe that a growing number of building society mortgages are issued on the basis of joint ownership. This is an increasing practice, which is certainly to be welcomed.

Does the Minister recognise that his astonishment is not good enough? He must know that the Rent Act 1974 has made the situation in many of our big cities very much worse, increased the number of homeless and dried up the supply of furnished accommodation. Will the statement deal with this?

With great respect to the hon. Gentleman, it would be far better if instead of making general statements of that kind, either in the House or elsewhere, he would submit actual material to the Department—for which I have certainly called—in order that we may monitor the position and take appropriate action. We have not received evidence to suggest that the Rent Act 1974 has produced the effects to which reference has been made. It was only a matter of days from the enactment of that legislation that propaganda was being put out to this effect, before anyone could possibly have been able to establish evidence. I suggest that all those now making noises on the Opposition side of the House should submit evidence to the Department so that we can take appropriate action. So far, not one of them has done so.

May I agree with the earlier remarks of my right hon. Friend the Secretary of State and say that it is the factor of uncertainty that dissuades a number of first-time buyers from entering the market? Believing as I do that they have more confidence in borrowing from local authorities, may I ask whether my hon. Friend will increase the limit in respect of reference to his Department for local authority purchases of houses from £250,000 to £500,000? Will he also review the whole procedure of the purchase of houses by local authorities so that it may be streamlined and quickened and so that vacant properties may be made available to first-time buyers from local authorities?

It will be the position shortly that we shall have to review the operation of Circular 70/74 under which there has been this encouragement and provision for local authorities to expand their house purchase practices. It is certainly true that there are many empty properties in stress areas that remain un-purchased by local authorities or houseing associations, and there is considerable scope in that direction to bring them into housing use. I shall take note of my hon. Friend's suggestion that we should increase the ceiling limit on particular purchases, though I must say that under the circular there has been a considerable expansion of capital expenditure in this field, to a level which I believe will be sustained during the coming financial year.

Invalid Tricycles


asked the Secretary of State for the Environment if he will now remove the exemptions which have been granted to exclude motor invalid tricycles from the safety requirements of the Motor Vehicles (Construction and Use) Regulations, in view of their high rate of injury accidents in comparison to small four-wheeled cars; and if he will make a statement.

No, Sir. Motor invalid tricycles are subject to all the provisions of the Motor Vehicles (Construction and Use) Regulations except the requirement to fit a speedometer in the case of tricycles weighing less than 5 cwt., and the provisions about collapsible steering columns in the case of tricycles steered by a tiller.

Does not the Minister agree that all the evidence, and even the latest report from his research laboratory, points to the inherent danger of three-wheeled vehicles? When will the Government carry out the first stages of the plan recommended by Baroness Sharp to phase out tricycles and introduce four-wheeled vehicles?

With respect, that is a rather different question. The question of policy on these vehicles is one for my right hon. Friend the Secretary of State for Social Services. It could not be met by any change in the Motor Vehicles (Construction and Use) Regulations.

The Minister will accept that the three-wheeled vehicles are not subject to the MOT test, as other vehicles are. Will he also accept that there is evidence that those who use these vehicles away from urban centres where they can be readily serviced are landing the taxpayer, let alone themselves, with very large bills as compared with the cost of the possible provision of standard four-wheeled minis with hand controls?

I am aware, though it is not a matter for me, that there is a preference for four-wheeled rather than three-wheeled vehicles. The vehicles which are maintained by the Department of Health and Social Security are not subject to the MOT test, because that would be a total waste of resources. But where they are privately owned and not maintained by that Department, like any other vehicle they are subject to the test.

Improvement Grants


asked the Secretary of State for the Environment whether he will now consider extending home improvement grants to include the installation of insulation schemes.

The Housing Act 1974 requires as a condition of issue of an improvement grant that a property must conform to prescribed standards of insulation. Grant is not available specially for this purpose but the cost of insulation should pay for itself through savings on fuel.

Does the Minister accept that this should be a matter for the Department of Energy as well and that if we are to have a comprehensive energy conservation policy it makes sense to encourage people to save fuel by insulating their homes more effectively?

I certainly accept the general point that the hon. Gentleman has put forward. All that we are doing in this matter, not only in connection with improvement grants policy but in other respects too, is being done in very close consultation indeed with the Department of Energy. There is an interdepartmental advisory committee on this very aspect as well as others connected with it.

Is it not time that the Government stopped talking about this and got on with it, in view of the fact that our insulation standards are about the worst in Europe? The urgent need to save energy could be partly satisfied by giving discretionary improvement grants for existing homes.

I do not accept that it is necessary to pay out public money for the purpose, but I accept that there is a need to increase insulation standards in this country. This has been advocated for a long time, but it is the present Government who have taken action to improve insulation standards.

Burmah Oil Company

With permission, Mr. Speaker, I should like to make a Statement.

Just before Christmas the Burmah Oil Company approached the Government and the Bank of England about its difficulties in meeting in full the technical requirements of certain loan agreements, due to a fall in income and the contraction of the market value of its assets. Burmah is a major British company with widespread international interests and an important involvement in the North Sea. We want to avoid any delay in developing the major fields of Ninian and Thistle.

Following consultation between the Treasury, my Department and the bank, it was therefore agreed that the bank would provide temporary financial support to enable the company to renegotiate its loan commitments and rationalise its activities, secured by the transfer of Burmah's unpledged holdings of the stock of BP and Shell to the bank. The bank offered its guarantee in support of certain substantial dollar borrowings for 12 months in the full expectation that it would be able to withdraw at the end of this period and leave the company to stand on its own.

The bank proposed to rely for its protection primarily on security taken from the group, which the bank judged to be adequate. The Government considered it right to guarantee the bank against any possibility of loss. I shall be seeking the approval of Parliament as necessary.

In return, Burmah confirmed its firm intention to proceed fully and as quickly as possible with the development of the Ninian and Thistle fields. It also undertook, in consideration for the support to be provided by the bank and the Government, to transfer to the Government, when required, 51 per cent. of its interest in commercial oilfields on the Continental Shelf. The precise terms of the participation will be negotiated between my Department and the company.

Discussions are continuing with the many interested parties. Some modification of the arrangements which I have described may well be needed. The bank will continue to act in close consultation with the Government; I shall keep the House informed.

While the whole House will have greeted with dismay the circumstances which forced this famous Scottish-based company to seek help from the authorities, we on this side of the House felt some sense of relief that it fell into the hands of the bank and not into the hands of the Secretary of State for Industry.

While, clearly, we must wait for Sir Ronald Leach's report of the details, will the right hon. Gentleman confirm that the immediate cause was the fall in the Stock Market values of Burmah's holdings in BP and Shell, as a result of which the company found itself in technical breach—[HON. MEMBERS: "No."]—I am quoting the Secretary of State's own words—found itself in technical breach of its loan obligations? Is it the Government's view that no question of insolvency arises here—in other words, that there is no question of the Government finding themselves in a Beagle situation?

Secondly, the Burmah company has deposited its holding of over 20 per cent. of the equity of BP with the bank as security. Will the right hon. Gentleman assure the House that these shares remain Burmah's property and that there is no question of the Government taking the shares into public ownership?

Thirdly, it is clear that Burmah has been forced to cede 51 per cent. of its North Sea interest under duress. Can the Minister give a categorical assurance that the terms offered to Burmah will be no less favourable than those which will be offered to other companies? Will he explain what those terms are? Can he clarify the very opaque and obscure statement made by his right hon. Friend the Chancellor of the Duchy of Lancaster before the weekend? Is it not clear that on the taxation and participation front, because the Government have been meddling in matters that they do not understand, their North Sea oil policy is rapidly slithering into total shambles?

The Government did not seek the difficulties which Burmah is experiencing and we take no satisfaction from the situation. It has nothing to do with the Government's North Sea oil policies. The problems of Burmah were due to the fall in the value of assets, and one of the main difficulties which the company had was the tanker, operations. The question of the BP shareholding is still a matter for consideration, and I do not rule out the possibility of the Government acquiring it from the bank, but further thought must be given to that.

Is my right hon. Friend aware that one of the chief contributions to the situation was mismanagement by Burmah, particularly in the Signal operation and not so much the tanker operations? Is my right hon. Friend aware also that the remarks made by the right hon. Member for Wanstead and Woodford (Mr. Jenkin) are no contribution to solving the problems of Burmah and that they are merely an exercise in petty party politics?

I very much agree with my hon. Friend that that contribution from the right hon. Gentleman does not help the Burmah situation at all. There have been management problems. It is widely recognised that there will be management changes. The managing director has already resigned, and the director of the tanker operations has also gone. I am absolutely certain that further management changes will be announced, and, I hope, announced shortly.

Is the right hon. Gentleman aware that the difficulties which this company has met have come about largely as a result of following the advice of many politicians 10 years ago to do the sort of things in management which were done, and that it showed enterprise not wisely but too well?

Is the right hon. Gentleman also aware that the problems derive immediately from the collapse of the Stock Market and the collapse in confidence in the North Sea as collateral for borrowing, which has nothing to do with the Government's policy but has a great deal to do with the escalating costs of getting the oil ashore? What will the Government do to get the oil out of the North Sea and to provide investment? We shall not be able to borrow it. Even the last Conservative Government could not print money on this scale.

The fact that we could move to assist in these circumstances is assisting the North Sea oil policy. It may well be that the development in the Thistle and Ninian fields might not have gone ahead, but, as a result of the support which the company is now receiving and the back-up guarantee which is being given, it will be possible for work to be pressed ahead in the Ninian and Thistle fields. Far from harming our North Sea oil policy and objectives, the Government are assisting them.

Has my right hon. Friend noticed the tactful reticence of the Scottish National Party on this matter? Does not this situation prove once and for all that winning oil from these inhospitable waters does not provide any kind of dripping roast in the form of extra benefits for Scots?

I am loath to get involved in an argument about Scottish nationalism, whether it assists in this situation or whether the Scottish National Party is reluctant to comment. I can tell my hon. Friend that it is the Government's intention to press forward as soon as possible with North Sea oil development and that we are being sucessful.

Will the Minister explain what he means by saying that the profitability of the Burmah Oil Company will be the same with 49 per cent. participation as though it had 100 per cent. ownership? As the Bank of England has the right to sell 21·7 per cent. investment, in what circumstances will the Labour Government purchase it?

It is far too early to speculate on the BP shareholding which the bank now holds. It is possible for the Government to acquire the shareholding of BP, but it is not yet decided whether that should be done. I do not rule it out, but we need to see how the situation develops in the weeks and months ahead.

Is my right hon. Friend aware that the Burmah Company, whose head offices are in my constituency, in the course of its public statements has made no statement that Government interference has had anything to do with the present collapse? Indeed, it accepts that it has overstretched its operations, and that is why it needs Government assistance, which is very much welcomed in my constituency.

May I ask two questions? First, does it make sound sense for the company to be required to get rid of its assets in North America? Secondly, has my right hon. Friend had any discussions with the Burmah Oil Company about the protection of the jobs of its employees, particularly those in my constituency?

I understand that no significant redundancies are planned for the Burmah operations in the United Kingdom. As for the North American assets, both Burmah and the Bank of England are convinced that certain slimming-down operations will have to take place. Some of the North American assets will have to be disposed of, and I think that is wise.

Is the Secretary of State convinced that after this operation sufficient capital will be available to Burmah fully to develop both the Ninian and the Thistle fields? Is he aware that because of the traditional Scottish connection with Burmah many Scottish pension funds, which are already in a shaky situation, have heavy investments in the company? Will he therefore say what he considers to be the outlook for the profitability and the shares of the company?

The company hopes in due course after the slimming-down operation and after the disposal of some of its North American assets to operate successfully. There is no question about that; the company is confident that it can do that. However, I shall keep the House informed as necessary. I think I have already answered the question of the present hope for the Ninian and Thistle fields. Finance will be made available and the operations there will go ahead as speedily as possible.

As it is obvious that the position of Burmah is due very largely to gambles that did not come off and to generally bad management, will my right hon. Friend say in respect of one of the least successful of its management operations—the negotiations over the loan with the Chase Manhattan Bank—how much of the British taxpayers' money will actually find its way across the Atlantic to that bank?

It is much too early to answer in any detail the question my hon. Friend posed. There is the guarantee which the bank has offered on the $650 million loans, and the precise nature of any sterling banking facilities have yet to be agreed.

Will the Minister accept, notwithstanding oil company propaganda to the contrary, that there still is a tremendous profit to be made out of North Sea oil and that it is advantageous to the community that there is a degree of public participation in it? Will he accept support from the Scottish National Party for the Government's action in the sense that the Government are following the policy towards public participation that we blazed several years ago?

I have only just noticed that, if it is the case. I remember one famous occasion during the "short Parliament", if I may call it that, between February and October last year when we had a major debate on public ownership and participation and the hon. Member and his colleagues followed the Conservatives into the Lobby. I very much agree with the hon. Member this far—that North Sea oil is still an extremely profitable operation, and most of the oil companies recognise that.

Aircraft Industry

I will with permission, Mr. Speaker, make a statement on public ownership of the aircraft industry.

It was announced in the Queen's Speech that legislation would be introduced this Session to bring the aircraft industry into public ownership, as part of our general industrial strategy. Our proposals are set out in detail in a consultative document published today. I am placing copies in the Library of the House and in the Vote Office. I plan to complete these consultations as soon as possible and introduce a Bill in good time for passage this Session.

We propose to vest in a new Aircraft Corporation the shares of any company in Great Britain which carries on the business of developing or manufacturing complete aircraft or guided weapons—but not including helicopters—the turnover of which, as shown in the accounts of its last financial year ending before 29th October 1974, together with that of its subsidiaries, exceeds £20 million. The companies which fall in this category are:
  • The British Aircraft Corporation Ltd.
  • Hawker Siddeley Aviation Ltd.
  • Hawker Siddeley Dynamics Ltd.
Together these companies account for about 80 per cent. of employment and turnover in the airframe and guided weapons sector.

The Aircraft Corporation will be operating in a highly competitive international environment. It should be able to adapt both its policies and its organisation quickly in response to changing circumstances and subject to the approval of the Secretary of State be able to diversify into other activities where its capacities and skills can be advantageously employed.

The powers of the Secretary of State will be the minimum needed to secure Government influence over the main strategies of the corporation and to protect the public investment in it. Experience with other nationalised industries has shown that statutory provisions, however carefully drawn in the first instance, can sometimes prove unexpectedly rigid. We therefore intend to provide that the powers and duties of the corporation and the powers of the Secretary of State may be capable of amendment by statutory instrument subject to affirmative resolution in both Houses of Parliament. This will introduce an important new element of flexibility into the statutory arrangements governing relations with a nationalised industry.

The Government believe that the proposals set out in the consultative document provide the basis for a successful and efficient aircraft industry and will command the support of those who work in it.

Does the Secretary of State recognise that this statement has been eagerly awaited and will be widely welcomed by the competitors of our industry throughout the world? Will he tell the House how much the proposals will cost and what the form of compensation will be? Will he also say where he sees the new organisation fitting into the development of the European aerospace industry? Finally, does he realise that the distorted priorities of this statement will do much to reinforce the view that his Department is now a major aggravator of the economic and industrial crisis facing this country?

It comes oddly from a Government that first bankrupted the jewel of the British aero-engine industry—[Interruption.] and then nationalised it—[HON. MEMBERS: "It was you."]—who did more damage—[Interruption.] The right hon. Gentleman bankrupted—

On a point of order, Mr. Speaker. Is the Secretary of State in order in making statements which he knows to be totally untrue?

It ill befits the hon. Gentleman and the Leader of the Opposition, who first bankrupted and then nationalised Rolls-Royce—

—to comment on a policy of the kind I have put forward today. The right hon. Gentleman—

On a point of order, Mr. Speaker. I distinctly heard the hon. Member for Stretford (Mr. Churchill) call out, "He is a liar".

Order. If the House will be a little quieter, I might be able to hear the hon. Member's point of order. Will he please repeat what he said?

Will the hon. Member withdraw that comment? [HON. MEMBERS: "No".] Order. That is not an expression that I am permitted to allow. Will the hon. Member withdraw it?

May I withdraw that remark and say that the right hon. Gentleman was guilty of a terminological inexactitude?

It saves time, when an hon. Member has used an unparliamentary term, if it is withdrawn without qualification.

On a point of order, Mr. Speaker. I distinctly heard the hon. Member for Henley (Mr. Heseltine) refer to my right hon. Friend as a liar. I would ask that that statement should be withdrawn.

Further to that point of order. On mature reflection I believe that my hon. Friend the Member for Stretford (Mr. Churchill) used a more accurate terminology, and I withdraw my original remark.

I wish to raise what I consider to be an important point about the conduct of affairs in the House. These difficulties arise because the Secretary of State, in particular, constantly makes statements in the Chamber which everybody knows bear no resemblance to the truth. If the level of debate is always to be lowered in that way, such incidents are unavoidable.

It would be in the interests of the House if both questions and statements were less provocative.

Order. It is in order to say that an industry has been bankrupted by a Government action. It may be correct or incorrect. It is certainly not out of order.

I apologise for continuing this with a further point of order. Would you arrange, Mr. Speaker, for all hon. Members on the Opposition benches who believe that the Secretary of State was at least inaccurate to rise?

Compensation provision will be fair. As to the hon. Gentleman's question about Europe, he knows as well as I do that the industry has collaborative arrangernents—I think nearly a thousand in all—not only with European manufacturers but with United States and other manufacturers. We intend international collaboration to continue and to be encouraged.

Is my right hon. Friend aware that those of our constituents who already have experience in the publicly-owned aero-engine industry will welcome his statement, although I think that they would all be somewhat bemused by the extraordinary scenes that followed it? In view of what my right hon. Friend said about the new public corporation being allowed to diversify, may I ask him how he sees the rôle of Hawker Siddeley within that corporation, as the firm has already diversified very far out of aviation as we understand it?

I shall do my best to answer. I confirm that Rolls-Royce in public ownership has done very well and has enjoyed the confidence of the people who work in it. My statement described the companies falling within the category I have described—BAC, Hawker Siddeley Aviation and Hawker Siddeley Dynamics. It will be open to the new corporation to diversify into areas which are capable of utilising the skill and ability of the people in the corporation, subject to the Secretary of State's approval.

Why has the Secretary of State not told the workers in the British aircraft industry that the people whom he is approaching to run his new national corporation are the very people at present managing the industry? Is not the exercise one in old-time politics, copied from Karl Marx once again, to nationalise the means of production, distribution and exchange, which is out of date and irrelevant for such a modern industry?

We advocated public ownership fully in two elections in 1974, and were assisted in our work of explaining the policy by Conservative Members, who contributed notably to seeing that everyone knew what our policy for the aircraft industry was. I should like to put on record my gratitude to the Leader of the Opposition, Aims of Industry and others who guaranteed that the policy was widely understood. It commanded wide support among those who work in the industry. It is a better way than nationalisation via a process of bankruptcy. It is not true that appointments have been made to the new Aircraft Corporation, nor does the speculation about appointments that might be made to an organising committee bear any resemblance to the truth.

Can my right hon. Friend give the House any hope of saving the HS 146 from being scuttled? It is the only viable civil aircraft we have to offer for the 1980s. If it is not saved, my right hon. Friend may find when he takes over Hawker Siddeley that there is nothing to take over.

I made a clear statement about the position at the time. Since I last reported to the House, there has been a tripartite meeting of the management of Hawker Siddeley, the unions concerned and myself. These meetings are continuing to discuss the future of the project. I made it quite clear that my statement about not being able to provide 100 per cent. funding at the time did not constitute a cancellation. The organising committee of the new Aircraft Corporation, which, under normal practice, would be set up in an early stage of legislation, will be able to take the project on board to consider as part of its corporate strategy.

What percentage of the total output of the three companies has been in the form of public contracts, either for the British Government or other Governments in recent years? What has been the level of public financial assistance to the companies?

In the consultative document the figures are given since 1966, but I can give the House the figures of public money that has, in one form or another, gone into the aircraft industry since 1964. Government support to the airframe sector for civil projects has been £350 million. Government expenditure on military research and development has been £450 million, and Government military procurement has been £1,100 million. Sales to the United Kingdom home civil market, mainly public sector purchases, have been £700 million. I think that it is reasonable to argue that in one way and another the relationship between the taxpayer and the British aircraft industry has been close. Under the arrangements I propose, we hope to be able to get it on a better basis.

What does the right hon. Gentleman expect will be the effect of the decision he has announced upon Short Brothers, Belfast? Will he ensure that the operations of that company are in no way prejudiced?

I assure the right hon. Gentleman that they are not prejudiced. We have seen Shorts in the context of the Northern Ireland economy. As the right hon. Gentleman will know, there is a big public stake in Shorts. Nothing I have said affects that position.

Against the background of the hollow indignation from the Opposition, I assure my right hon. Friend that his announcement has the support of this side of the House and is warmly welcomed. What arrangements will he introduce to carry out the other part of Labour's programme of public ownership, that of introducing workers' participation and control, as an example to the rest of industry?

My hon. Friend will find special reference to that matter in paragraph 11 of the consultative document, but in view of the importance of what he said I should like to read the following sentence:

"Industrial democracy should … develop organically from the views and proposals put forward by the management, workers and trade unions concerned."
The Government will consider, in the light of present consultations with all the parties in the industry, how the process can best be encouraged. I should like to take this opportunity of making clear that what are being brought into the public sector are some of the finest skills this country has produced, largely financed by public money. If there were more concern with those who make and design aircraft and manage the aircraft corporations, and less with the interests which the Conservative Party has espoused, we should make more sense of this and other industries.

Will the right hon Gentleman tell us what effects nationalisation of the airframe industry as he outlines will have on employment prospects in the industry?

There is no direct connection in the sense in which it might be interpreted. Clearly everyone in the industry and others know—I have made this clear in all the speeches that I have made to aircraft workers—that in the end an industry must survive on its market. There are at present problems concerning the world market although we believe that it will recover. The fuel crisis is especially affecting the aircraft market. I believe that the general effect will be to boost confidence in exactly the same way as it was possible for Rolls-Royce to go ahead with the—524 engine recently in circumstances that, in my judgment, would not have been possible if it had had to rely upon market financing.

Is my right hon. Friend aware that his statement will be welcomed by Hawker Siddeley Aviation in Hatfield and in other constituencies? Does he realise that they would welcome even more a positive statement of faith in the civil airframe industry, particularly design staff, technology and resources in human terms, to which my right hon. Friend has referred, by a more definite commitment on the HS 146 project. It is the only new civil aviation project that we have. I think that workers in my constituency would like me to point out that they are very concerned about the Government putting off a decision until the Aircraft Corporation is formed. That is a delay which will lose markets. They would rather have an answer on the project now.

I appreciate what my hon. Friend has said. Along with other Members from both sides of the House she has argued her case with great fluency over the past few months. She will also recognise that I set up the tri-partite meeting, and that we are now able to anticipate the establishment of an organising committee which will be able to consider the matter in a different context. We have been as good as our word. That is a matter that my hon. Friend could properly take back to her constituents who work for Hawker Siddeley. I am well aware of the welcome that my statement will receive in the industry. It has been my privilege to work out this policy with those representing the workers in the industry. There is no doubt that my statement will receive a warm welcome from them.

As the right hon. Gentleman has constantly mentioned Rolls- Royce, will he now acknowledge once and for all that Rolls-Royce went into liquidation because it was unable to carry out the terms of the contract on the RB-211 engine? The contract was negotiated under the right hon. Gentleman's authority as a Minister and under his personal persuasion. That is what drove Rolls-Royce into liquidation. The plain fact is that to put the whole of the aircraft industry into similar hands will have similar disastrous consequences.

The right hon. Gentleman has produced no justification for the policy which he has put forward today. He has less than 40 per cent. of the votes of the British people in support of it. The skills of the people in the British aircraft industry and the design teams were built up not by any Government but by private enterprise. It was private enterprise that was responsible for the establishment of the people to whom he is now paying tribute.

Lastly, does the right hon. Gentleman recognise that the measures that he has put forward will be opposed by my right hon. and hon. Friends by means of all the parliamentary procedures under our control?

The right hon. Gentleman has questioned our mandate. Will he please draw the attention of the House to the reference in his 1970 manifesto about his desire to bring Rolls-Royce into public ownership? He had no mandate for that. He campaigned vigorously against public ownership. Then, as he knows very well, within a few months of coming to power his own Government confirmed the RB-211 contract. The right hon. Member for Knutsford (Mr. Davies), who was then the Minister responsible, made a statement in the House in 1970 confirming that the project would go ahead and announcing a tranche of money. When Rolls-Royce went bankrupt the right hon. Gentleman addressed a meeting of Young Conservatives the following day. He said that this was the lesson that we must all learn. When the final compensation terms were announced it was clear that Rolls-Royce need never have gone into bankruptcy. The right hon. Gentleman inflicted very serious and unnecessary damage on the British aero-engine industry. He also endangered the reputation of Britain as a partner with Lockheed and others in the United States.

Once again the Minister has come forward with both untruths and half truths. The plain fact is that Rolls-Royce was liable to damages up to £400 million. The company knew that, and it is a public fact. That was why it was driven into liquidation by the contract made under the right hon. Gentleman's ministership. What we had to do was to try to rescue Rolls-Royce from the right hon. Gentleman's sins. The plain fact was that the company's liabilities were of such a scale that it could not be rescued from the disaster.

The right hon. Gentleman should consult the record. He will find that in July 1970, after the Labour Government left office, the chairman of Rolls-Royce made it clear at the annual meeting that in his judgment there were no problems regarding the funding of the RB-211. That judgment was confirmed in October by the Minister responsible when he came forward with a further tranche. As the right hon. Gentleman says, his Government chose bankruptcy so as to default on obligations confirmed by the Cabinet only some months earlier. That did great damage, and needless damage, to the reputation of the British aircraft industry. I ask the right hon. Gentleman to withdraw what he said.

On a point of order, Mr. Speaker. By way of comment on previous angry scenes and on what the right hon. Gentleman has just said, I point out that I happen to be wearing the mourning tie that was issued to mark the bankruptcy of the Beagle Aircraft Company, for which the right hon. Gentleman bears sole responsibility.

Order. The kind of tie that a Member wears has nothing to do with the Chair. Mr. Radice.

Industrial Democracy

4.7 p.m.

I beg to move,

That leave be given to bring in a Bill to amend the Companies Act 1967 and to make further provision, in regard to companies and nationalised industries, for trade union representation on supervisory boards.
What I and my supporters are seeking to do is to give legislative form to the pledges on industrial democracy made in Labour Party manifestos at both the 1974 elections. I believe that there is now a considerable body of support for an extension of industrial democracy amongst workers and their representatives at shop floor level, amongst national trade unions and in the TUC itself. The ideas behind the Bill are largely drawn from the TUC's report to last year's congress.

I believe that there is a growing recognition that it is no longer enough to negotiate wages and conditions and to leave the rest to management. Decisions on closures, mergers, the location of plant and the whole shape of future corporate strategy are so important that they largely determine the living standards and working conditions of most employees. No wonder that workers and their representatives are now demanding a say in management.

Workers and their representatives want more control over the key decisions that affect their working lives, and they are asking for action by the present Government. There was no mention of industrial democracy in the Queen's Speech, and it is because of that omission that I and my supporters, who are from many wings and sections of the Parliamentary Labour Party, are bringing the Bill before the House.

Perhaps the most important and most immediately realisable objective of the Bill is to ensure that 50 per cent. of the members of the boards of nationalised industries are employed representatives elected through trade union machinery. At the moment there are trade unionists on the boards of nationalised industries, but they are there in their own right and not as representatives. We believe that if this Bill becomes law it will be possible to move very quickly in the public sector.

However, in the private sector the situation is far more complicated. The Bill would first change the Companies Act 1967 so that the directors of a company would be legally obliged to take account of the interests and the point of view of employees. It would also change company structure, initially only for those companies employing more than 2,000 workers, by setting up a two-tier board system with a supreme supervisory board over a smaller executive body. Over half the members of the supervisory board would be employee representatives elected through trade union machinery. The supervisory board would have the final say on such major questions as large-scale investment, closures and mergers, plant location, redeployment, the appointment of the executive board, and so on. It would be right for employees in the private sector to be able to choose whether they wanted a two-tier board system and their own representatives on the supervisory boards.

In non-union firms the choice would be supervised by the Conciliation and Arbitration Service. In organised firms it would be conducted through trade union machinery. A non-mandatory system in the private sector, such as I have just described, would, I believe, satisfy those trade unions which expressed reservations at last year's TUC conference, including the AUEW and the National Union of General and Municipal Workers, of which I am a sponsored Member of Parliament.

The possibility of choice would go a long way towards satisfying those who, though in favour of industrial democracy, believe that it would be wrong to impose any one system. We do not believe, as some fear, that employee representation on boards would lead to the emasculation of the trade union movement. On the contrary, the effect of the proposals contained in the Bill, such as employee-directors as representatives, the 50 per cent. parity representation, the election through trade union machinery, is to extend collective bargaining into the boardroom, the only difference from normal bargaining being that employee-directors would be putting forward their side of the argument in a wider context and would be concerned with the higher level of decision making.

I understand that the CBI is hostile to the ideas on which this Bill is based. No doubt the CBI view has influenced the attitude of the major Opposition party, although only a year ago the Conservative Government promised in the Queen's Speech a White Paper on industrial democracy.

I should like to make it clear that efficient, up-to-date management will have nothing to fear from this Bill. It will have to justify its actions not by reference to a sterile, out-dated managerial prerogative but in terms of relevance and effectiveness. Only managements living in the past will have to change, and rightly so.

To those who claim that only management has the right to manage, we say that workers who play such an essential part in the success of an enterprise should have a right to their say. Of those who argue that only managers have the necessary skills, we ask "Why is management so eager to promote shop stewards and to attract trade union officials to join their ranks?" To those who fear trade union independence, we point out that normal collective bargaining already involves participation. What is at stake is not the principle but the form of the participation.

The Industrial Democracy Bill is the natural follow-up to the Trade Union and Labour Relations Act and to the proposed Employment Protection Bill. If the Government will commit themselves quickly to their own Bill, we shall be delighted to withdraw this Bill at a later stage. However, in the absence of that commitment, I ask leave of the House to bring in this Bill.

4.15 p.m.

Order. Unnecessary as it may seem, I am obliged to ask the hon. Member whether he is seeking to oppose the Bill?

Yes, Mr. Deputy Speaker. As you have already stated, it is my intention to suggest that leave be not given to bring in the Bill.

The hon. Member for Chester-le-Street (Mr. Radice) has made his intention clear before today. In a recent newspaper article, I read a report saying that his purpose was to force the Government to make clear their position. The report continued:
"Supporters of the Bill believe that the Secretary for Employment, Mr. Foot, is in favour of legislation, but that the Secretary for Industry, Mr. Benn the other Minister most affected, is much cooler."
I do not believe that the House is the right place in which to smoke out the controversial and difficult figures on the Treasury Bench who are at loggerheads, nor do I believe that the House is in any mood to digest any more legislation. We have had a veritable avalanche of Bills already. We have just heard that we are to have another Bill, concerning aviation. In his statement about that, the Secretary of State for Industry went out of his way to say that industrial democracy should develop organically and should not be legislated upon. The conflicts in the Labour Party should not be resolved in the House of Commons, especially when we have already plenty to do to supervise the legislation which has been produced by a profligate administration who are spending our money faster than they should.

Starting with the substance of the Bill, the hon. Gentleman surprised me by making a speech on the subject without once mentioning the words "industrial efficiency". He must agree that we face in our industrial history a period of grave crisis, that we have clear illiquidity in many companies, that we are not as competitive in the world as we should be, that we are losing our share of the market, and that imports are often cheaper than home-produced goods. He must be aware that we have a very serious situation, due, if I may now be more controversial, to our failure to use modern machinery and to make sufficient investments in that modern machinery to increase productivity per man.

Will the hon. Gentleman's proposals be more likely to increase our industrial efficiency and the use of machinery and research than if those proposals are not put into effect? When I hear him speaking about the rights of employees, the rights of trade unions and what people would like to see happen, I am, to say the least, suspicious. So often I have heard the demands of trade unions, repeated this afternoon by the Secretary of State for Industry and by the hon. Gentleman, to the effect that trade unions should have control over whether certain plants should close down when they become out of date and inefficient, whether new machinery should be manned properly or over-manned, and whether the major strategic industrial decisions should be taken by those who are responsible for the proper husbanding of the capital resources employed or by those who are responsible for the working of the machinery.

It is the natural and proper job of a trade union to force the maximum out of the employers and to cause the minimum of disturbance to their members. Naturally, they fight to preserve many jobs and to preserve old-fashioned techniques which affect employment in industry. I have every sympathy with them and with those who are displaced by modern techniques. However, if the hon. Gentleman is seriously suggesting that we should now set up a system whereby half the members serving on the supervisory boards in private industry and the nationalised boards should be the directly appointed representatives of those same trade unions, he is making a plea for greater industrial inefficiency.

This is a matter that the trade unions have yet to prove. They have yet to prove that they can rid our industry of over-manning, restrictive practices and encumbrances upon the use of the most modern techniques and of the minimum number of people to work modern machinery. For them to seek to go into this kind of industrial democracy before they have proved that is to seek to retard still further our recovery as an industrial nation.

The hon. Member for Chester-le-Street was at least honest about what he wanted his Bill to do. He wanted a two-tier board system for companies with more than 2,000 employees, and he wanted half the supervisory board composed of workers who were appointed by the relevant trade unions. "Elected" is a word which I did not hear during the hon. Gentleman's remarks. If he meant that, I am at least encouraged to hear it. But if we are to have a system of this kind, why should not we have the workers themselves in the plant or industry elect the directors? Why does it have to be the trade unions which are in command of this? It puts the trade unions in a very difficult position. The trade unions exist to further the interests of the work force. If the trade unions are to appoint directors, how can they decide "Yes, we are sorry, but this plant must be closed, and this machine must be manned by only two men rather than six."? How can trade unions be put in a position where they have two duties, the one contrary to the other?

This is one reason why the hon. Member for Chester-le-Street has got into trouble with his own trade union, the National Union of General and Municipal Workers. According to the same newspaper article,
"The AUEW and the NUGMW have expressed on this score objections"
to what the hon. Gentleman proposes. It is, of course, quite wrong to mix up the function of a trade union, which is to protect and increase the wages of the work force, with that of management, which is to earn those wages by the proper stewardship of capital.

If we take the examples that we have in the nationalised industries, especially in the British Steel Corporation where something along these lines has been tried, the evidence is not that it leads to greater mobility of labour and greater efficiency in the use of capital resources. The evidence is that more and more people find it a convenient way of earning a perpetual living, ignoring industrial logic and the need for change.

Division No. 52.]


[4.23 p.m.

Allaun, FrankBrown, Hugh D. (Provan)Cryer, Bob
Archer, PeterBrown, Robert C. (Newcastle W)Cunningham, Dr J. (Whiteh)
Atkins, Ronald (Preston N)Buchan, NormanDalyell, Tam
Atkinson, NormanBuchanan, RichardDavidson, Arthur
Bagier, Gordon A. T.Butler, Mrs Joyce (Wood Green)Davies, Ifor (Gower)
Barnett, Guy (Greenwich)Callaghan, Jim (Middleton & P)Deakins, Eric
Barnett, Rt Hon JoelCampbell, IanDelargy, Hugh
Bates, AlfCanavan, DennisDempsey, James
Bean, R. E.Carmichael, NeilDoig, Peter
Beith, A. J.Carter, RayDormand, J. D.
Bennett, Andrew (Stockport N)Carter-Jones, LewisDouglas-Mann, Bruce
Bidwell, SydneyCartwright, JohnDuffy, A. E. P.
Biggs-Davison, JohnClemitson, IvorDunlop, John
Bishop, E. S.Cocks, Michael (Bristol S)Dunwoody, Mrs Gwyneth
Blenkinsop, ArthurCohen, StanleyEadle, Alex
Booth, AlbertColeman, DonaldEdelman, Maurice
Boothroyd, Miss BettyColquhoun, Mrs MaureenEdge, Geoff
Bottomley, Rt Hon ArthurCook, Robin F. (Edin C)Edwards, Robert (Wolv SE)
Boyden, James (Bish Auck)Cox, Thomas (Tooting)Ellis, John (Brigg & Scun)
Bradley, TomCraigen, J. M. (Maryhill)Ellis, Tom (Wrexham)
Broughton, Sir AlfredCronin, JohnEnglish, Michael

In our industry we need a more adventurous spirit from managers, trade unions and work people. It is a spirit which involves moving from one industry to another as one grows and another declines. It involves manning machines to the minimum required, as was done during the three-day working week without much drop in production. It is a spirit which will not shackle our industry in the strait jacket of procedures such as those proposed by the hon. Member for Chester-le-Street.

It is very important to bring together the entire work force of the country, along with management, in the activities of their firms or their nationalised industries. I support entirely that part of the hon. Gentleman's objective. But, like the Secretary of State for Industry, I believe that it is better done organically. It is better left to each concern to evolve the way that it can do it best, be it through works councils, worker directors, some form of participation, or even perhaps the two-tier board system. For us to seek to lay further burdens on already hard-pressed management by legislating some firm pattern in matters like this would retard and eventually stop industrial development itself.

I ask the House to deny leave to the hon. Member for Chester-le-Street to bring in his Bill.

Question put pursuant to Standing Order No. 13 ( Motions for leave to bring in Bills and nomination of Select Committees at commencement of Public Business):—

The House divided: Ayes 250, Noes 124.

Ennals, DavidLamborn, HarryRooker, J. W.
Evans, Gwynfor (Carmarthen)Lamond, JamesRoper, John
Evans, Ioan (Aberdare)Leadbitter, TedRoss, Stephen (Isle of Wight)
Evans, John (Newton)Lewis, Arthur (Newham N)Ross, Rt Hon W. (Kilmarnock)
Ewing, Harry (Stirling)Lewis, Ron (Carlisle)Rowlands, Ted
Fernyhough, Rt Hon E.Lipton, MarcusSedgemore, Brian
Fitch, Alan (Wigan)Litterick, TomSelby, Harry
Fitt, Gerard (Belfast W)Loyden, EddieShaw, Arnold (Ilford South)
Flannery, MartinLuard, EvanSheldon, Robert (Ashton-u-Lyne)
Fletcher, Raymond (Ilkeston)Lyon, Alexander (York)Silverman, Julius
Fletcher, Ted (Darlington)Lyons, Edward (Bradford W)Skinner, Dennis
Forrester, JohnMabon, Dr J. DicksonSmall, William
Fowler, Gerald (The Wrekin)McCartney, HughSmith, John (N Lanarkshire)
Freeson, ReginaldMcElhone, FrankSnape, Peter
Freud, ClementMacFarquhar, RoderickSpearing, Nigel
Garrett, John (Norwich S)Mackenzie, GregorSpriggs, Leslie
Garrett, W. E. (Wallsend)McMillan, Tom (Glasgow C)Stallard, A. W.
George, BruceMadden, MaxSteel, David (Roxburgh)
Gilbert, Dr JohnMagee, BryanStewart, Rt Hn M. (Fulham)
Ginsburg, DavidMahon, SimonStoddart, David
Golding, JohnMarks, KennethStott, Roger
Gould, BryanMarquand, DavidStrang, Gavin
Gourlay, HarryMarshall, Dr Edmund (Goole)Summerskill, Hon Dr Shirley
Graham, TedMarshall, Jim (Leicester S)Swain, Thomas
Grant, George (Morpeth)Meacher, MichaelTaylor, Mrs Ann (Bolton W)
Grant, John (Islington C)Mellish, Rt Hon RobertThomas, Dafydd (Merioneth)
Grimond, Rt Hon J.Mendelson, JohnThomas, Ron (Bristol NW)
Grocott, BruceMikardo, IanThorne, Stan (Preston South)
Hamilton, James (Bothwell)Millan, BruceTierney, Sydney
Hamilton, W. W. (Central Fife)Miller, Dr M. S. (E Kilbride)Tinn, James
Hamling, WilliamMiller, Mrs Millie (Ilford N)Tomlinson, John
Hardy, PeterMitchell, R. C. (Soton, Itchen)Torney, Tom
Harper JosephMolloy, WilliamTuck, Raphael
Harrison, Walter (Wakefield)Moonman, EricUrwin, T. W.
Hatton, FrankMorris, Alfred (Wythenshawe)Varley, Rt Hon Eric G.
Hayman, Mrs HeleneMorris, Charles R. (Openshaw)Wainwright, Edwin (Dearne V)
Hooley, FrankMorris, Rt Hon J. (Aberavon)Wainwright, Richard (Colne V)
Hooson, EmlynMulley, Rt Hon FrederickWalden, Brian (B'ham, L'dyw'd)
Horam, JohnMurray, Ronald KingWalker, Terry (Kingswood)
Howells, Geraint (Cardigan)Newens, StanleyWatkins, David
Hoyle, Douglas (Nelson)Noble, MikeWatkinson, John
Huckfield, LesOakes, GordonWeetch, Ken
Hughes, Rt Hon C. (Anglesey)Orbach, MauriceWeitzman, David
Hughes, Mark (Durham)Orme, Rt Hon StanleyWellbeloved, James
Hughes, Robert (Aberdeen N)Ovenden, JohnWhite, Frank R. (Bury)
Hughes, Roy (Newport)Owen, Dr DavidWhite, James (Pollok)
Hunter, AdamPadley, WalterWhitehead, Phillip
Irvine, Rt Hon Sir A. (Edge Hill)Pardoe, JohnWhitlock, William
Jackson, Miss Margaret (Lincoln)Park, GeorgeWigley, Dafydd
Janner, GrevilleParker, JohnWilley, Rt Hon Frederick
Jay, Rt Hon DouglasParry, RobertWilliams, Alan Lee (Hornch'ch)
Jenkins, Hugh (Putney)Pavitt, LaurieWilliams, W. T. (Warrington)
John, BrynmorPeart, Rt Hon FredWilson, Alexander (Hamilton)
Johnson, James (Hull West)Phipps, Dr ColinWilson, William (Coventry SE)
Johnson, Walter (Derby S)Prescott, JohnWise, Mrs Audrey
Jones, Alec (Rhondda)Price, William (Rugby)Woodall, Alec
Jones, Barry (East Flint)Radice, GilesWoof, Robert
Jones, Dan (Burnley)Rees, Rt Hon Merlyn (Leeds S)Wrigglesworth, Ian
Kaufman, GeraldRichardson, Miss JoYoung, David (Bolton E)
Kelley, RichardRoberts, Albert (Normanton)
Kerr, RussellRoberts, Gwilym (Cannock)TELLERS FOR THE AYES:
Kilroy-Silk, RobertRobertson, John (Paisley)Mr. Ernest G. Perry and
Kinnock NeilRoderick, CaerwynMr. James Sillars.
Lambie, DavidRodgers, George (Chorley)


Adley, RobertCockcroft, JohnGrieve, Percy
Alison, MichaelDodsworth, GeoffreyGrist, Ian
Baker, KennethDrayson, BurnabyHall, Sir John
Banks, RobertDurant, TonyHamilton, Michael (Salisbury)
Bennett, Dr Reginald (Fareham)Edwards, Nicholas (Pembroke)Hannam, John
Benyon, W.Elliott, Sir WilliamHarvie Anderson, Rt Hon Miss
Berry, Hon AnthonyFinsberg, GeoffreyHawkins, Paul
Biffen, JohnFookes, Miss JanetHordern, Peter
Body, RichardFox, MarcusIrving, Charles (Cheltenham)
Boscawen, Hon RobertFraser, Rt Hon H. (Stafford & St)Jenkin, Rt Hon P. (Wanst'd & W'df'd)
Bowden, A. (Brighton, Kemptown)Gardiner, George (Reigate)Kellett-Bowman, Mrs Elaine
Boyson, Dr Rhodes (Brent)Gilmour, Rt Hon Ian (Chesham)Kimball, Marcus
Brown, Sir Edward (Bath)Godber, Rt Hon JosephKing, Tom (Bridgwater)
Budgen, NickGoodhart, PhilipKnight, Mrs Jill
Burden, F. A.Goodhew, VictorLamont, Norman
Carlisle, MarkGow, Ian (Eastbourne)Lane, David
Churchill, W. S.Gower, Sir Raymond (Barry)Lawrence, Ivan

Le Merchant, SpencerOsborn, JohnSpeed, Keith
Lester, Jim (Beeston)Page, Rt Hon R. Graham (Crosby)Spence, John
Lewis, Kenneth (Rutland)Parkinson, CecilSpicer, Jim (W Dorset)
Lloyd, IanPattie, GeoffreySpicer, Michael (S Worcester)
McAdden, Sir StephenPeyton, Rt Hon JohnStainton, Keith
McCrindle, RobertPink, R. BonnerStanbrook, Ivor
Macfarlane, NeilPowell, Rt Hon J. EnochStanley, John
McNair-Wilson, P. (New Forest)Pym, Rt Hon FrancisSteen, Anthony (Wavertree)
Marten, NeilRaison, TimothyStokes, John
Mates, MichaelRathbone, TimStradling Thomas, J.
Mather, CarolRees, Peter (Dover & Deal)Thomas, Rt Hon P. (Hendon S)
Maude, AngusRees-Davies, W. R.Townsend, Cyril D.
Mawby, RayRenton, Rt Hon Sir D. (Hunts)Wakeham, John
Meyer, Sir AnthonyRidsdale, JulianWalters, Dennis
Miller, Hal (Bromsgrove)Roberts, Michael (Cardiff NW)Warren, Kenneth
Mills, PeterRodgers, Sir John (Sevenoaks)Weatherill, Bernard
Mitchell, David (Basingstoke)Rossl Hugh (Hornsey)Wells, John
Montgomery, FergusRost, Peter (SE Derbyshire)Wiggin, Jerry
Morgan-Giles, Rear-AdmiralRoyle, Sir AnthonyWinterton, Nicholas
Morris, Michael (Northampton S)Scott, NicholasYounger, Hon George
Morrison, Charles (Devizes)Shaw, Giles (Pudsey)
Morrison, Peter (Chester)Shepherd, Colin
Neave, AireyShersby, MichaelTELLERS FOR THE NOES:
Nelson, AnthonySims, RogerMr. Patrick Cormack and
Neubert, MichaelSinclair, Sir GeorgeMr. Nicholas Ridley.
Onslow, CranleySkeet, T. H. H.

Question accordingly agreed to.

Bill ordered to be brought in by Mr. Giles Radice, Mr. Jack Ashley, Mr. T. W. Urwin, Mr. Neil Kinnock, Mr. John Horam, Mr. Phillip Whitehead, Mr. James Sillars, Dr. John A. Cunningham, Mr. David Watkins, Mr. A. E. P. Duffy, Mr. Jeffrey Rooker, and Mr. Michael English.

Industrial Democracy

Mr. Giles Radice accordingly presented a Bill to amend the Companies Act 1967 and to make further provision, in regard to companies and nationalised industries, for trade union representation on supervisory boards: and the same was read the First time; and ordered to be read a Second time upon Friday 28th February and to be printed. [Bill 60.]

Orders Of The Day

Finance Bill

Clauses 5, 14, 16, 17, 33 and 49 referred to in the Order of the House [17th December 1974].

Considered in Committee.

[Mr. GEORGE THOMAS in the Chair]

Clause 5

Income Tax: Alteration Of Additional Rates For 1974–75

4.32 p.m.

I beg to move, in page 3, line 33, to leave out from 'the' to the end of line 39 and insert

'addition after paragraph (b) of the following provision, that is to say—'.
With it may I discuss the linking amendment, No. 8, in page 4, line 2, leave out '10' and insert '15'.

The story behind these amendments will be very familiar to some Members of the Committee, but for those who may not have followed all its aspects, it is worth while going over some of the story again—and a very shoddy story it is. I should like to take the Committee back to the night of 16th July when an amendment moved by, I believe, the hon. Member for Cornwall, North (Mr. Pardoe) was carried after a rather desultory debate by 16 votes. That amendment rejected proposals by the then minority Government to change the threshold for the investment income surcharge from £2,000 to £1,000, or down to £1,500 for those over 65.

Although it was desultory debate, it was rather significant because it contained a chilling phrase of the Chief Secretary that he regarded the people concerned and affected by the amendment—and we are talking here for the most part of elderly people, not necessarily retired but getting on, who have saved up and are living on a savings and investment income considerably lower than the average wage in Britain today—as the "lowest priority". That brought home to some of my hon. Friends on this side of the Committee just exactly what were the views of the Chief Secretary and his colleagues on priorities and their view of the kind of people we believe needed to be helped.

The House and Parliament at that time rejected the proposals of the Government but on 12th November, after a General Election, the Chancellor of the Exchequer came forward again and announced that he wished to reverse the matter and to go back to his original proposals of 26th March last year and that he intended to do so retrospectively. He did not, of course, say it in that way. He offered no arguments whatever.

If hon. Members will turn to the Chancellor's Budget Statement of 12th November 1974 they will see that he said
"I intend to restore the proposal I made in my first Budget to bring down the starting point of the investment income surcharge from £2.000 to £1,000, or £l.500 for the over 65s. The House rejected that proposal in the summer"
—the Chancellor admitted it quite frankly—
"but I believe that it will now recognise that the burden of personal tax should fall that much more heavily on investment income than on income which is earned by current effort."—[Official Report, 12th November 1974; Vol. 881, c. 274.]
Whether or not one agrees with that sentiment, and I do not, that has nothing to do with what the Chancellor is proposing. It is just possible to argue that if the Government elected on 10th October 1974 wish in 1975 to attack elderly couples living on sums which are below the average weekly wage in this country they have some right to do so. I do not believe in the doctrine of the mandate but I suppose that an argument of that kind could be produced. What the Government have no right to do is to legislate into the past and overturn the clear decision of a previous Parliament on this matter. We regard this as an unpleasant piece of political horse trading which we shall oppose